First Quarter 2021 Results
Q1 2021 results: net revenues decrease in line with Group’s expectations, purchasing cost inflation weighing on profitability.
First Quarter 2021 Results:
- Net revenues down -8.5% with a like-for-like change of -3.8% versus Q1 2020, reflecting a slow recovery in commercial segments, partially offset by the continued rebound of residential;
- Adjusted EBITDA of €34.0 million or a 6.1 % margin, down versus last year as a result of lower revenues and higher purchasing costs at the end of the quarter;
- Supply shortages and additional raw material and freight price increases leading to higher purchasing costs in Q1;
- Purchasing costs inflation now estimated at €100 million for 2021 - Additional selling price increases being implemented in response with a target to offset around 50%;
- Strong achievements in cost flexing and structural savings (€24.1 million, o/w €14.7 million of structural cost savings); cost reduction on track to outreach €30 million in 2021;
- Solid financial structure with net debt post IFRS 16 at €536.8 million at the end of March, or 2.0x LTM Adjusted EBITDA;
- Given the acceleration of purchasing cost inflation and low visibility confirmed in workplace and hospitality, the timing of the 2022 profitability mid-term objective (Adjusted EBITDA margin above 12%) should be delayed by at least one year.
Paris, April 23, 2021: The Supervisory Board of Tarkett (Euronext Paris: FR0004188670 TKTT) met on the 23d of April and reviewed the Group’s consolidated results for the first quarter 2021.
The Company uses alternative performance indicators (not defined by IFRS) described in detail in appendix 1 (page 5):
Commenting on these results, CEO Fabrice Barthélemy said: “The start of the year is challenging but in line with our expectations, as some commercial segments are still penalized by the lack of visibility. We are also dealing with steep purchasing cost inflation combined with supply disruptions. Given this challenging environment, we are focused on increasing our selling prices and implementing our cost reduction plans. We also pursue the strategic initiatives of our Change to Win roadmap, making significant progress in our transformation journey. However, the pandemic impact on demand is generating some short term headwinds and we remain cautious on the pace of recovery.”
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