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2020/07/29

H1 2020 results: Profitability preserved despite Q2 revenue drop. Financial leverage well contained at 2.8x

Q2 and Half Year 2020 Results

  • H1 2020 revenues down -12.4% at €1,237 million, following a -20.5% drop in Q2 revenues due to the Covid-19 spread and lockdown measures. Sequential improvement of sales over Q2;
  • €51 million of cost savings in H1 2020, including €29 million of Covid-19 measures;
  • Adjusted EBITDA at €106 million in H1 2020 with preserved margin at 8.6% versus 9.0% last year;
  • Net income impacted by -€54 million non-cash charge for impairment mainly related to assets in the hospitality segment;
  • Free cash-flow of -€76 million in H1 2020 in line with usual seasonality;
  • Leverage of 2.8x at end of June 2020 (pre IFRS16 as per our credit documentation). Available confirmed liquidity of €945 million;
  • Solid fundamentals to cope with uncertain economic conditions in H2 2020, confirmed Change to Win financial objectives for 2021 and 2022.

Paris, July 29, 2020: The Supervisory Board of Tarkett (Euronext Paris: FR0004188670 TKTT) met today and reviewed the Group’s consolidated results for the first half of 2020.

The Company uses alternative performance indicators (not defined by IFRS) described in details in appendix 1 (page 8 of press release):
 

€ million

H1 2020

H1 2019

Change

Net sales

Organic growth

1,237.0

 


1,412.3
 

 

-12.4%

-12.6%

Adjusted EBITDA

% net sales

106.3

8.6%

126.7

9.0%

-16.1%

-0.4pts

Result from operations (EBIT)

% net sales

-43.6

-3.5%

33.1

2.3%

-

Net profit attributable to owners of the Company

Fully diluted Earnings per share (€)

-64.9

-1.00

7.7

0.12

 

Free cash-flow

-75.9

41.5

 

Net Debt before IFRS 16 application

Net Debt to Adjusted EBITDA before IFRS16

630.8

2.8x

715.8

2.9x

-11.9%

 

Net Debt

728.0

810.0

-10.1%


Commenting on these results, CEO Fabrice Barthélemy said: “As anticipated, the second quarter has been significantly impacted by Covid-19, with lockdown measures implemented throughout most of our regions. While making safety our #1 priority and remaining fully engaged with customers, we managed to keep operations running and we rapidly launched numerous initiatives to flex our costs and prioritize our investments. Along with the exceptional dedication of our teams, this allowed us to maintain profitability, contain cash consumption and protect the financial structure. Although we saw some gradual improvements over the second quarter, we remain cautious about the second half of the year as some of our key regions, like North America, are still fighting the pandemic. ”

Download complete press release: EN - FR