Half-Year Financial Results 2019
Moderate organic growth, selling prices holding up well
Ongoing deployment of new strategic plan Change to Win
Paris, July 23, 2019
- Net revenues at €1,412 million in H1 2019 (+7.2% versus H1 2018), driven by moderate organic growth, a positive scope effect and a positive forex impact (US dollar driven)
- Organic growth(1) up 1.3% in H1 2019 and roughly stable in Q2 2019: lower flooring activity compared to a buoyant Q2 2018, double digit growth in Sports
- Selling price increases offsetting persistent purchasing costs inflation
- H1 2019 adjusted EBITDA(2) before IFRS 16 at €112 million or 7.9% of revenues, a decrease of 90bps versus H1 2018 mainly due to unfavorable product mix and a one-time inventory write-off
- Positive free cash flow in H1 2019 and stable leverage at 2.9x Adjusted EBITDA pro forma at the end of June notwithstanding structural seasonality of H1
- Several refinancing transactions completed in H1 2019 to extend debt maturity and reduce cost of financing; solid take up of the scrip dividend option (elected by 80% of shareholders)
- New strategic plan, Change to Win, currently being shared and implemented across the Group; restructuring initiatives well on track to start delivering in H2 2019
- Group’s focus remains on improving profitability and deleveraging for full year 2019
(1) Organic growth is the revenue growth on a like-for-like basis, i.e. at constant scope of consolidation and exchange rates, and therefore only reflects changes in volumes, prices and the product mix (note that in the CIS segment, price increases implemented to offset currency fluctuations are not included in organic growth). See the definition of alternative performance indicators at the end of this press release.
(2) Adjusted EBITDA: adjustments include expenses such as those relating to restructuring, acquisitions and share-based payments. See the definition of alternative performance indicators at the end of this press release.
Commenting on these results, CEO Fabrice Barthélemy said:
“After a strong first quarter, we recorded a mixed performance in the second quarter. This did not come as a surprise as we had a less favorable comparison basis and confirms that we are facing tougher market conditions than in 2018. The environment is clearly not going to provide any tailwind: we will durably improve our profitability thanks to our strategy announced in June. 2019 is a transitional year as we start to implement the first initiatives of our new strategy announced in June. We are reducing our cost base, simplifying our processes and focusing our organization on the needs of our customers. We reduced our debt notwithstanding the seasonality of the first half and also improved our financial structure. I am pleased to see that our teams are fully committed on the strategic priorities of our Change to Win plan and I am confident in our capacity to improve our profitability while building sustainable growth. ”