Egide: 2019 first half results
Bollène, September 27, 2019 – 7:00 am
(CET)Press release
2019 first half results
- H1 2019 sales: €14.9m (-8.5% YoY)
- Net income: -€1.85m impacted by a restructuring reserve
of €0.73m
- Strong rebound in order intake in H1: +23% YoY at
€18.8m
- Reorganization plan to improve operations in France
under implementation
The interim financial statements for the
six-month period ended June 30, 2019 have been approved by the
audit committee and the board of directors. The auditors performed
a review of these interim financial statements and their report
thereon was issued in accordance with the provisions of the
law.
Egide Group's consolidated EBITDA* for the
six-month period ended June 30, 2019 came at €0.19m, down €0.65m
YoY, impacted by the marked slowdown in H1 revenue (-8.5% YoY).
*Ebidta definition: includes EBE + variation in
inventory depreciation
FIRST-HALF RESULTS
€m - IFRS |
H1 2019 |
H1 2018 |
Revenue |
14.87 |
16.25 |
Gross operating surplus / (EBE) |
(0.15) |
0.84 |
Operating profit / (loss) |
(1.52) |
0.43 |
Net financial income (expense) |
(0.33) |
(0.22) |
Net income/(loss) |
(1.85) |
0.09 |
The sharp drop in sales of ceramic products
related to the weakness of both the thermal imaging and microwave
markets led to a 29% fall in Egide SA's sales and accounts for most
of the slowdown in the Group's revenue during the 1st half.
US revenues (Egide USA + Santier) are up +10%
(+2.5% at constant exchange rate) vs. H1-2018, even though market
environment was still difficult at Santier. USA HTCC ceramics sales
more than doubled in H1 (+119%) but from an insufficient basis to
offset the sharp drop in sales at Egide SA and the slowdown in
Santier at S1. Sales of Glass to Metal products at Egide USA also
recorded a good performance and supported Group sales in
H1-2019.
Egide recorded a strong rebound in its order
intake in H1, +23% YoY at €18.8m, which was driven by both the US
and European operations and should have positive implications for
revenues in the second half of the year.
The first application of IFRS 16 as of January
1, 2019 (relating to leases) resulted in the increase in
depreciation and amortization for €231k and in financial interests
for €103k. This was almost entirely offset by a decrease in rents
for €324k, with a positive impact on the computation of the EBITDA
under the new rules.
The pre-tax income for the first half of 2019
showed a loss of €1,851k compared to a profit of €217k in the first
half of 2018. Excluding the restructuring provision for €0.73m, the
pre-tax loss amounted to €1,121k.
The gains related to the translation of the
financial statements of subsidiaries denominated in dollars
compared to the end of 2018 had a positive impact of €56k on the
overall result, bringing the loss to €1,795k as of June 30,
2019.
CONSOLIDATED BALANCE SHEET HIGHLIGHTS AT
JUNE 30, 2019
ASSETS |
EQUITY & LIABILITIES |
Non-current assets |
11.60 |
Shareholders’ equity |
11.28 |
Inventory, trade and other receivables |
14.32 |
Financial debt and provisions |
12.81 |
Cash |
3.87 |
Trade and other payables |
5.70 |
TOTAL |
29.79 |
TOTAL |
29.79 |
IFRS 16 application resulted in an increase of
non-current assets by €2.95k corresponding to a right to use the
assets. It also resulted in an increase of liabilities of €2.84k
long term and €0.47k short term, corresponding to the actualized
rents to be paid until the end of the leases.
The acquisitions of property, plant and
equipment for the first half of the year amounted to €0.27m,
including €0.01m for Egide SA, €0.01m for Egide USA and €0.01m for
Santier. The right to use assets whose contracts started in the
first half of 2019 amounted to €0.08m. The working capital
requirement (inventories + trade receivables + other current assets
- trade payables - other current liabilities) was 105 days of
turnover, compared with 89 days at June 30, 2018. Other non-current
assets mainly represent taxes. reported in 2017 in US
subsidiaries.
Shareholders' equity amounts to €11.28m, or 38%
of the balance sheet total. Non-current provisions are related to
benefits to Egide SA staff (pensions, long-service awards,
seniority). The financial debts consist mainly of the bond loan,
the Santier loan, the Egide USA revolving loan, the Sofired loan
and the Egide SA debt.
KEY EVENTS OF THE FIRST HALF:
CAPITAL INCREASE &
EGIDE SA REORGANIZATION
Capital IncreaseAt the
beginning of June, Egide successfully completed a €2.6m capital
increase by issuing new shares. The transaction, carried out with
shareholders' preferential subscription rights, was oversubscribed
at 103.2% and raised a total of €2.6m. The objectives of this
operation were to allow the financing of industrial investments and
the reorganization of operations, in order to improve the
performance of the teams. particularly in France.
Egide SA reorganizationThe
reorganization of Egide SA consists in transferring the graphite
machining activity from Trappes to Bollène, as well as the
administrative services (purchasing, accounting and
marketing).Egide SA restructuring will cost approximately €730k,
which is provisioned as of June 30, 2019. The expected gains are
€580k in 2020 and €660k on a full year basis afterwards.
Almost all the restructuring costs relate to
redundancy payments to members of staff who decided not to move
from the Paris region to Vaucluse (South of France).
OUTLOOK
The group expects slight growth in 2019 despite
the tough H1.
The second half of the year will show continuous
growth of the US operations and a return to positive growth at
Egide SA despite a challenging market environment, especially in
Europe.
The reorganization of Egide SA launched at the
start of H2, is expected to be completed by the end of the year,
with most of its operational impact being felt from Q1 2020.
New product offerings in thermal battery
applications, oil exploration, RF/MW applications and light
amplification, sensors/MEMs will provide opportunities for revenue
growth in the coming years.Some technological developments are
under way such as Titanium brasing or 3D printing capabilities to
enable the group to develop relevant products in niche markets
identified as being profitable in the long term.
Jim Collins, Chairman and CEO, comments: “The
results of H1 2019, while disappointing, were expected as the
previously announced slowdown in the European thermal imaging
market came to fruition. These variations in revenue make the
decision to lower fixed costs at our French operation more
important, and as such, we are committed to complete our
reorganization in H2. On the bright side, bookings have improved,
resulting in an increase in firm order backlog.
Improved revenue performance, along with the decrease in fixed
costs, will improve our bottom-line performance moving
forward.”
FINANCIAL CALENDAR2019 Annual
Revenue: January 29, 2020 (after French market
closure)
* * * * *
To find out more about Egide:
www.egide-group.com
About EgideEgide is a group with
an international dimension, specialized in the manufacture of
hermetic packages and heat dissipation solutions for sensitive
electronic components. It operates in cutting edge markets with
strong technology barriers to entry in all critical industry
segments (Thermal Imaging, Optronics, High-Frequency, Power
Units…). Egide is the only pure player in this market niche with
manufacturing bases in France and the United States.
Egide’s eligibility for tax efficient
French innovation-focused mutual funds (FCPI) was renewed on May
14, 2018 its.
Egide is listed on Euronext Paris™- Segment C -
ISIN code: FR0000072373 – Reuters: EGID.PA – Bloomberg: GID
CONTACTS
EGIDE – Luc Ardon –
CFO - +33 4 90 30 35 94 – luc.ardon@fr.egide-group.com INBOUND
CAPITAL – Investor Relations – Frédéric Portier - +44 7802
533333 – fportier@inbound.capital FIN’EX TENSO – Press Relations -
Isabelle Aprile - +33 1 39 97 61 22 – i.aprile@finextenso.fr
- EGIDE-2019-half-year-results-PR09272019