Derichebourg
confirms the resilience of its economic model
The Board meeting of May 22, 2019,
chaired by Mr. Daniel Derichebourg, approved the half-year
financial statements at March 31, 2019. During the meeting, the
Chairman and Chief Executive Officer noted the soundness of the
Group's economic model and the robustness of its results, despite
slowing economic growth and an environment beset by considerable
uncertainties. In this context, which reflects a decline in
financial performance by all players in the recycling industry, the
Group has managed to limit the negative effects thanks to
substantive work done on scaling its production facilities,
continued attention to unit margins and the level of inventories,
and to its dense territorial network, which ensures it has a
regular supply, and makes it possible to monetize specialized
facilities whose profitability is better than the average in the
business.
Revenue amounts
to 1.38 billion
Revenue for the first half of the
year amounted to €1.38 billion, a decrease by 5.7%. Revenue growth
for the Multiservices business did not offset the decline in the
Environmental Services business.
(in thousand tons) |
03/31/2019 |
03/31/2018 |
Change |
|
|
|
|
Ferrous metals |
1,737.9 |
1,912.8 |
-9.1% |
Non-ferrous metals |
268.0 |
271.7 |
-1.4% |
Total volumes |
2,005.9 |
2,184.5 |
-8.2% |
|
|
|
|
(in millions of euros) |
03/31/2019 |
03/31/2018 |
Change |
|
|
|
|
Ferrous metals |
448.5 |
511.7 |
-12.4% |
Non-ferrous metals |
342.1 |
382.4 |
-10.5% |
Services |
166.1 |
166.8 |
-0.4% |
Environmental Services revenue |
956.7 |
1,060.8 |
-9.8% |
Multiservices revenue |
418.7 |
397.4 |
5.4% |
Holding company revenue |
0.5 |
0.3 |
53.1% |
Total half-year revenue, Derichebourg
Group |
1,375.9 |
1,458.5 |
-5.7% |
Environmental
Services
Volumes of ferrous metals
processed were negatively impacted by:
-
a less favorable economic environment overall
than last year, reflected in particular in the decline in steel
production in Europe and a decline in selling prices;
-
a sharp fall in steel production in Turkey (-10%
as compared to the same period of the previous fiscal year due to
the country's economic crisis), this country having seldom
supported the world market for ferrous metals, with the exception
of the month of February;
-
The two-month shutdown over the winter of the
Carros (06) shredder due to difficulties in removing shredding
residues.
Volumes of non-ferrous metals have
been maintained, notably thanks to the increased strength of the
second aluminum refining unit at Prémery. Nevertheless, a
deterioration of business in the automotive sector has been
noticeable since last fall, which is pulling prices down. Stainless
steel waste is in significant decline (-25%), waste copper has
grown (+4.3%).
Revenue for Services has declined
slightly (-0.4%), because revenue from waste collection activities
in Italy has not been consolidated since February, following
divestiture on January 30, 2019.
Multiservices
Revenue for each of the four
segments of activity (Services, Industry, HR Sourcing Solution,
Urban Areas) have seen sustained growth. Overall, growth is at
5.4%.
Recurring EBITDA
[1], €93.4
million
Recurring EBITDA amounted to €93.4
million, down 7% compared to last year. It represents 6.8% of
revenue, a similar ratio to that of last year (6.9%).
In the Environmental Services
business, the lower volume of ferrous metals processed, and to a
lesser extent slightly lower unit margins for non-ferrous metals,
partially offset by a fall in expenses, essentially explain this
€4.6 million fall.
In the Multiservices business, the
apparent €1.2 million fall is explained by:
-
problems with contracts in the nuclear
engineering business, which is currently being shut down, and
contributed negatively (-€2.6 million);
-
the transition between the CICE (tax credit to
improve competitiveness) and the reduction in employer
contributions meant, for companies practicing deferred pay, a
one-time shortfall of €1.7 million.
After restating these two effects,
recurring EBITDA from the Multiservices business would be up and
represent 4.2% of revenue.
An operating
profit close to that of last year
Operating profit amounted to
€48.1 million, close to that of last year (€49.8 million).
The Multiservices business is
seeking to terminate a certain number of engineering contracts in
the nuclear sector, and recognized the remaining costs to be
incurred on these contracts, in an amount of €2.8 million.
Last year, non-current items
recorded the cost of two transactions to end litigation in Italy in
the amount of €10 million.
Consolidated net
income down 16.3%
After taking into account
financial expenses, corporate income tax and profit (loss) from
discontinued operations, consolidated net income amounted to €31.6
million, down 16.3% in comparison to the first half of last
year.
Outlook for the
second half of the fiscal year
In the Environmental Services
business, the Group notes that trade (China - USA) and geopolitical
tensions have been exacerbated rather than reduced. There appears
to be more downside (automotive sector, and European steel sector)
than upside in economic conditions. In the short term, the high
price of iron ore may serve to support that of ferrous metals.
Structural difficulties related to the evacuation of shredding
residue cannot be resolved in a few months, even if temporary
solutions have been found. The Group will continue to prove the
resilience of its business model, and its responsiveness. This
situation should make it possible for the Group to strengthen its
competitive position in its markets, where its leadership is
already on display. An investment policy that allows for constant
improvement of its online production facilities with an evolution
in sorting techniques and environmental constraints will continue.
This strategy, combined with a very solid financial structure and
the long-term strategic vision of its family shareholders, confers
the status of a structural consolidator, which will allow the
company to profit from this situation in order to make strategic
acquisitions when valuations in the sector become attractive
again.
In the Multiservice business,
revenue should grow moderately in the second half of the year, and
the second half will be better than the first in terms of income.
Catching up with the backlog recorded in the first half of the year
is foreseeable, all things being equal.
Treasury shares
cancellation
The Board of Directors also
exercised the delegation granted by the Extraordinary General
Meeting of February 5th 2019, and
cancelled 4,481,291 treasury shares representing 2.73% of the share
capital. The company's share capital now comprises 159,397,489
shares.
INCOME
STATEMENT
In
millions of euros |
03/31/2019 |
03/31/2018 |
Change |
|
|
|
|
Revenue |
1,375.9 |
1,458.5 |
(5.7%) |
of which Environmental Services |
956.7 |
1,060.8 |
(9.8%) |
of which Multiservices |
418.7 |
397.4 |
5.4% |
|
|
|
|
Recurring EBITDA |
93.4 |
100.5 |
(7.0%) |
of which Environmental Services |
83.9 |
88.5 |
(5.2%) |
of which Multiservices |
13.5 |
14.7 |
(8.3%) |
|
|
|
|
Recurring operating profit |
50.9 |
61.0 |
(16.6%) |
of which Environmental Services |
48.0 |
55.5 |
(13.5%) |
of which Multiservices |
8.0 |
9.7 |
(17.1%) |
|
|
|
|
Net non-current items |
(2.8) |
(11.3) |
|
|
|
|
|
Operating Profit |
48.1 |
49.8 |
(3.3%) |
|
|
|
|
Net financial expenses |
(5.2) |
(5.3) |
|
Other financial items |
(1.2) |
0.1 |
|
|
|
|
|
Profit before tax |
41.7 |
44.5 |
(6.3%) |
|
|
|
|
Income tax |
(10.9) |
(10.9) |
|
Income from associates |
0.8 |
0.7 |
|
Income from discontinued or held-for-sale activities |
|
3.4 |
|
Net profit (loss) attributable to non-controlling
interests |
(1.1) |
(0.6) |
|
|
|
|
|
Net profit (loss) attributable to
shareholders |
30.5 |
37.1 |
(18.0%) |
BALANCE
SHEET
(in millions of euros) |
03/31/2019 |
09/30/2018 |
Variation (%) |
Goodwill |
220.0 |
217.9 |
|
Intangible assets |
7.5 |
6.2 |
|
Property, plant and equipment |
507.9 |
480.9 |
|
Financial assets |
14.9 |
10.5 |
|
Equity interests in associates and joint ventures |
17.5 |
17.1 |
|
Deferred taxes |
25.9 |
22.0 |
|
Total non-current assets |
793.7 |
754.6 |
5.2% |
Inventories |
76.3 |
76.7 |
|
Trade receivables |
301.2 |
286.6 |
|
Tax receivables |
3.1 |
11.4 |
|
Other assets |
63.6 |
82.7 |
|
Financial assets |
13.4 |
13.8 |
|
Cash and cash equivalents |
131.5 |
145.6 |
|
Total current assets |
589.1 |
616.9 |
(4.5%) |
Total non-current assets and groups of assets held for
sale |
|
41.4 |
|
Total assets |
1,382.8 |
1,412.9 |
(2.1%) |
|
|
|
|
|
|
|
|
(in millions of euros) |
03/31/2019 |
09/30/2018 |
Variation (%) |
Group shareholders' equity |
500.7 |
507.9 |
|
Non-controlling interests |
4.3 |
3.8 |
|
Total shareholders' equity |
505.0 |
511.7 |
(1.3%) |
Loans and financial debts |
157.6 |
156.2 |
|
Provisions for pensions and similar benefits |
42.8 |
42.6 |
|
Other provisions |
23.7 |
25.3 |
|
Deferred taxes |
16.4 |
17.5 |
|
Other liabilities |
1.7 |
1.7 |
|
Total non-current liabilities |
242.1 |
243.4 |
(0.5%) |
Loans and financial debts |
82.5 |
84.5 |
|
Provisions |
7.4 |
4.8 |
|
Trade payables |
283.1 |
281.2 |
|
Tax payables |
14.7 |
3.3 |
|
Other liabilities |
246.3 |
255.0 |
|
Financial instruments |
1.8 |
1.1 |
|
Total current liabilities |
635.8 |
629.9 |
0.9% |
Total liabilities related to a group of assets held for
sale |
|
27.9 |
|
Total liabilities |
1,382.8 |
1,412.9 |
(2.1%) |
Passage of net
financial debt from September 30, 2018 to March 31, 2019
Net financial debt at September 30,
2018 |
95.1 |
Recurring EBITDA |
(93.4) |
Net
financial expenses |
5.2 |
Corporate income taxes |
(3.2) |
Change
in working capital requirement |
8.6 |
Tangible and intangible capital investments |
59.7 |
Own
shares |
16.9 |
Dividends |
22.4 |
Acquisitions |
4.2 |
Disposals of companies |
(8.2) |
Other |
1.2 |
Net financial debt at March 31,
2019 |
108.5 |
About Derichebourg
The Derichebourg
Group is a major player working for companies and local authorities
on an international scale. It offers a comprehensive and integrated
range of services in two complementary business segments:
environmental services (recycling, recovery, collection of
household waste, urban cleaning, management of waste reception
centers, etc.) and business services (cleaning, energy, interim,
aeronautics, etc.). The Group is present today in 15 countries, on
3 continents, and has some 39,400 employees worldwide. In 2018, the
Derichebourg Group's revenue amounted to €2.9 billion. For more
information: www.derichebourg.com
ISIN code: FR0000053381 -
DBG
[1] Recurring
EBITDA = Recurring operating profit (loss) + net depreciation and
amortization on tangible and intangible assets
Recurring operating profit (loss) = Operating
profit (loss) +/- non-recurring items
Results of the first half of
2018-2019
This
announcement is distributed by West Corporation on behalf of West
Corporation clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: DERICHEBOURG via Globenewswire
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