With EBITA up by 144% and a faster pace of
deleveraging
Regulatory News:
Today, Elior Group (Paris:ELIOR) (Euronext Paris – ISIN: FR
0011950732), a world leader in catering and multiservices, is
releasing its unaudited results for the first half of the 2023-2024
fiscal year (six months ended March 31, 2024).
- Initial benefits from our strategy implemented since April
2023
- A more agile and efficient Group
- A return to profitability and growth momentum back on
track
- Robust business development, led by strong customer relations
and contract performance
- Costs streamlined
- Ongoing deleveraging
- Solid results for the first half of fiscal 2023-2024
- €3,123 million in consolidated revenue, representing 5.9%
organic growth
- A more-than twofold increase in adjusted EBITA to €100 million
from €41 million a year earlier; adjusted EBITA margin up 150 basis
points to 3.2%
- A positive €169 million in free cash flow versus a negative €15
million a year earlier
- A €137 million reduction in net debt during the period
- Leverage ratio (net debt/adjusted EBITDA) of 4.1x, i.e., below
the 5.25x set for the covenant test
Outlook for full-year 2023-2024
- Organic revenue growth between 4% and 5%
- Adjusted EBITA margin of at least 2.5%
- Leverage ratio (net debt/adjusted EBITDA) around 4.0x at
September 30, 2024
Commenting on these results, Daniel Derichebourg, Elior
Group’s Chairman and CEO, said:
“Against a backdrop of market uncertainty, Elior delivered a
solid performance in the first half of fiscal 2023-2024. We’ve
returned to operating profitability and have removed sources of
losses within several strategic contracts. Our business development
was robust and we won and renewed major contracts during the
period. We also continued to deleverage the Group. Our revenue and
organic growth are trending upwards, both overall and for our
businesses individually, as are our EBITDA and profit margin. These
are all signs that our recovery is continuing at a good pace, even
though there's still some way to go.
Our first-half 2023-2024 results are the outcome of the
structural changes we’ve been putting in place since April 2023
following the alliance between Elior and Derichebourg
Multiservices. The intense efforts we’ve made are beginning to pay
off and we plan to steadily and rigorously pursue them going
forward. In view of all of these factors, I have every confidence
in our ability to carry on down the path of profitable and
sustainable growth. I’d like to take this opportunity to thank all
of our teams for their hard work and all of our stakeholders – both
internal and external – for their unwavering support.”
Business Development
Several major contracts were won or renewed in the first half of
2023-2024, including with the following:
- In Contract Catering
- France: Dassault Aviation’s head office, the municipality of
Aubervilliers, l’École Nationale de Police de Oissel, and the
Sainte Croix Sainte Euverte Orléans group of schools
- United Kingdom: Leeds-Bradford international airport passenger
lounges and Leicestershire County Cricket Club
- Italy: BNL Aldobrandeschi
- Spain: Fundación La Caixa
- United States: The Thomas Jefferson Foundation Inc. and Pine
Bluff School
- India: Boeing India Private Limited and Autodesk India PVT.
Limited
- In Multiservices
- Facility: Disney Hotel and Edvance (EDF group)
- Health: Hôpital Ambroise Paré and Centre René Gauducheau
- Temporary Staffing: Le Saint group
- Aeronautics: new contracts with Airbus
- Energy & Urban: Batipart Immo and the municipality of
Argenteuil
Revenue
Consolidated revenue from continuing operations amounted to
€3,123 million in the first half of fiscal 2023-2024, compared
with €2,478 million for the year-earlier period. This 26.0%
increase reflects organic growth of 5.9%, a 0.7% negative currency
effect and a 20.8% positive impact from changes in scope of
consolidation, mainly due to the consolidation of Derichebourg
Multiservices (DMS) as from April 18, 2023.
On a like-for-like basis, revenue rose by 4.6%, including a
positive 1.0% volume effect and a favorable 3.6% price effect.
Business development remained robust in the first half of
2023-2024, driving up revenue by 9%, having already added 10.3% to
the first-half 2022-2023 revenue figure.
Contract losses, excluding voluntary contract exits, reduced
revenue by 6.4%. On this basis, the revenue retention rate was
93.6% at March 31, 2024. Voluntary contract exits trimmed a further
1.3% from revenue. The overall revenue retention rate was therefore
92.3%, up 1 point on the 91.3% recorded at March 31, 2023.
Revenue by business segment
Contract Catering revenue totaled €2,293 million in the
first half of 2023-2024 versus €2,169 million in the same period of
2022-2023, representing year-on-year growth of 5.7%. This increase
breaks down as follows: 5.9% organic growth, a positive 0.6% impact
from changes in scope of consolidation stemming from the
acquisition of Cater to You in the United States, and a negative
0.8% currency effect.
Multiservices revenue jumped to €823 million from €302
million in the year-earlier period. This €521 million increase
reflects organic growth of 6.0% and a positive €503 million impact
from changes in scope of consolidation, arising on the first-time
consolidation of DMS.
The Corporate & Other segment, which includes the
Group’s “Ciel de Paris” and “Maison de l’Amérique Latine”
concession catering activities, generated €7 million in revenue in
first-half 2023-2024.
Pro forma revenue
On a pro forma basis, consolidated revenue was 5.3% higher than
the €2,965 million recorded for the first half of 2022-2023. Pro
forma revenue growth for Multiservices was 4.3%.
Adjusted EBITA and Other Income Statement Items
Consolidated adjusted EBITA from continuing operations came to
€100 million in the first half of 2023-2024, compared with €41
million for the same period of 2022-2023. Adjusted EBITA margin
widened by 150 basis points to 3.2% from 1.7%. The effect of price
increases more than offset the impact of inflation. Operational
efficiency gains – which amounted to €29 million, including €9
million in synergies achieved – also contributed to the improvement
in operating profitability.
In Contract Catering, adjusted EBITA came in at €91
million, versus €49 million a year earlier. Adjusted EBITA margin
was 4.0%, up 170 basis points from 2.3% in the same period of
2022-2023.
In Multiservices, adjusted EBITA was €16 million,
compared with a €2 million loss in the first half of 2022-2023.
Adjusted EBITA margin was 1.9%, representing a 270 basis-point
positive swing versus the negative 0.8% reported a year earlier,
before the consolidation of DMS.
For the Corporate & Other segment, adjusted EBITA
represented a €7 million loss, against a €6 million loss in the
same period of 2022-2023, reflecting the first-time consolidation
of DMS’ corporate structures.
Pro forma EBITA
On a pro forma basis, EBITA margin for the Group as a whole also
increased by 150 basis points from the 1.7% EBITA margin posted for
the first half of 2022-2023. The pro forma EBITA margin for
Multiservices widened by 70 basis point from 1.2% in the first half
of 2022-2023. The Corporate & Other segment saw a €2 million
improvement in pro forma adjusted EBITA compared with the first
half of 2022-2023, reflecting the cost savings already achieved for
the corporate structures.
Recurring operating profit from continuing operations
totaled €88 million in the first half of 2023-2024, compared with
€30 million a year earlier.
Non-recurring income and expenses represented a net
expense of €15 million, versus a net expense of €17 million in
first-half 2022-2023, and included €12 million in restructuring
costs.
The Group recorded a net financial expense of €52 million
for the six months ended March 31, 2024 compared with €35 million
in first-half 2022-2023, reflecting the increase in average debt
and interest rates, and, to a lesser extent, the interest expense
on DMS’ factoring program.
Income tax represented a €20 million charge versus a €3
million charge a year earlier. Current income tax expense amounted
to €14 million (including the CVAE tax charge in France) and
deferred tax expense was €6 million, mainly due to the profit
generated in France during the period.
In view of the above factors, the Group ended first-half
2023-2024 with €1 million in net profit for the period
attributable to owners of the parent, compared with a €23
million attributable net loss for the same period of 2022-2023.
Cash Flows, Debt and Liquidity
Free cash flow amounted to a positive €169 million, up
sharply on the negative €15 million recorded for first-half
2022-2023.
The net change in operating working capital represented a
strong cash inflow of €83 million, including a reversal of the €38
million temporary negative movement related to outstanding
securitized and factored receivables recorded at the end of the
2022-2023 fiscal year. On a normalized basis, i.e., after
neutralizing this €38 million positive reversal effect, free
cash flow would have totaled €131 million.
EBITDA rose sharply from €107 million in first-half
2022-2023 to €189 million in the first six months of 2023-2024.
Net capital expenditure increased by €11 million year on
year to €43 million from €32 million, reflecting the first-time
consolidation of DMS. As a percentage of revenue it represented
1.4%, up slightly on the 1.3% for first-half 2022-2023.
Net debt stood at €1,256 million at March 31, 2024,
versus €1,393 million at September 30, 2023.
The leverage ratio (net debt/adjusted EBITDA), as
calculated for the purpose of the test carried out by the Group’s
lenders, was 4.1x at March 31, 2024, i.e., below the 5.25x set in
the covenant.
The Group’s available liquidity totaled €342 million at
March 31, 2024, against €313 million at September 30, 2023, and
included €81 million in cash and cash equivalents, an undrawn €190
million under its €350 million revolving credit facility and €71
million in other available credit facilities.
Corporate Social Responsibility (CSR)
Highly aware of Elior's footprint and our responsibilities
towards our stakeholders, in the first half of 2023-2024 we
continued to work on defining the Group's new social and
environmental commitments with a view to publishing our
sustainability roadmap by the end of the fiscal year.
We completed our double materiality analysis during the period,
which enabled us to identify the Group’s strategic goals and
challenges regarding the social and environmental impacts that its
activities have on its stakeholders and the financial impacts that
social and environmental issues have on the Group.
This analysis will also enable the Group to comply with the EU
Corporate Sustainability Reporting Directive (CSRD) and therefore
publish its first sustainability report as early as the end of
fiscal 2023-2024.
Events After the Reporting Date
On April 30, 2024, the Group signed an agreement to acquire DCK
Catering, a school catering company based and operating in Hong
Kong. This acquisition will strengthen the Group’s positions in the
contract catering market in Asia.
With an operating presence in India since 2017, in 2023 when
Daniel Derichebourg arrived, the Group decided to accelerate its
expansion there through robust organic growth and bolt-on
acquisitions.
Outlook
The Group's activity remains well oriented in each of its two
businesses, and the upward trend in prices is expected to continue
to boost revenue for the rest of fiscal 2023-2024. During the
remainder of the year we intend to continue to win new business
while at the same time streamlining our portfolio of existing
contracts whose profitability levels are still considered
insufficient.
In view of the above factors and our solid results for the first
half of 2023-2024, we are standing by our previously announced
guidance for the full fiscal year, namely:
- Organic revenue growth between 4% and 5%
- Adjusted EBITA margin of at least 2.5%.
- Net debt/EBITDA ratio around 4.0x at September 30, 2024
We have set the following mid-term financial targets:
- €56 million in run-rate synergies by 2026 (compared with the
initially targeted €30 million)
- Net debt/adjusted EBITDA ratio below 3.0x at September 30,
2026
Presentation
The Group’s presentation of its results for the first half of
2023-2024 will take place on May 16, 2024, at 9:00 a.m. Paris
time and will be accessible by webcast and telephone.
Participants will be able to ask questions over the phone only.
The webcast will be accessible via the following link:
https://channel.royalcast.com/landingpage/eliorgroup/20240516_1/
The dial-in numbers for the conference call are as follows:
France: +33 (0) 1 7037 7166
United Kingdom: +44 (0) 33 0551 0200
United States: +1 786 697 3501
Access code: Elior Group; please log in at least 10 minutes
before the start of the presentation.
Financial calendar
November 20, 2024: full-year results for fiscal 2023-2024 –
pre-market press release and conference call
Appendices
Appendix 1: Revenue by business segment
Appendix 2: Revenue by geographic area
Appendix 3: Pro forma revenue by business segment
Appendix 4: Adjusted EBITA and adjusted EBITA margin by business
segment
Appendix 5: Pro forma adjusted EBITA and adjusted EBITA margin
by business segment
Appendix 6: Simplified cash flow statement
Appendix 7: Consolidated financial statements
Appendix 8: Definitions of alternative performance
indicators
About Elior Group
Founded in 1991, Elior Group is a world leader in contract
catering and multiservices, and a benchmark player in the business
& industry, local authority, education and health & welfare
markets. With strong positions in ten countries, the Group
generated €5.8 billion in pro forma revenue in fiscal 2022-2023.
Our 133,000 employees cater for 3.1 million people every day at
20,200 restaurants and points of sale on three continents.
The Group’s business model is built on both innovation and
social responsibility. Elior Group has been a member of the United
Nations Global Compact since 2004, reaching advanced level in
2015.
To find out more, visit www.eliorgroup.com/Follow Elior Group on
Twitter: @Elior_Group
Appendix 1: Revenue by business
segment
H1
2023-24
H1
2022-23
Organic
growth
Changes in
scope of consolidation
Currency
effect
Total year-on-year
change
(in € millions)
Contract Catering
2,293
2,169
5.9%
+0.6%
-0.8%
+5.7%
Multiservices
823
302
6.0%
+166.9%
0.0%
+172.9%
Sub-total
3,116
2,471
5.9%
+20.9%
-0.7%
+26.1%
Corporate & Other
7
7
1.9%
NM
NM
+1.9%
GROUP TOTAL
3,123
2,478
5.9%
+20.8%
-0.7%
+26.0%
NM: not material
Appendix 2: Revenue by geographic
area
H1
(in € millions)
2023-24
France
1,607
Europe (including the UK)
841
Rest of the world
675
GROUP TOTAL
3,123
H1
H2
12 months
(in € millions)
2022-23
2022-23
2022-23
France
1,112
1,428
2,540
Europe (including the UK)
719
704
1,423
Rest of the world
647
613
1,260
GROUP TOTAL
2,478
2,745
5,223
Appendix 3: Pro forma revenue by
business segment
Pro forma 2022-23
H1
H2
12 months
(in € millions)
2022-23
2022-23
2022-23
Contract Catering
2,169
1,982
4,151
Multiservices
789
804
1,593
Sub-total
2,958
2,786
5,744
Corporate & Other
7
9
16
GROUP TOTAL
2,965
2,795
5,760
Appendix 4: Adjusted EBITA and adjusted
EBITA margin by business segment
H1
Change in
adjusted EBITA
Adjusted EBITA margin
(in € millions)
2023-24
2022-23
2023-24
2022-23
Contract Catering
91
49
+42
4.0%
2.3%
Multiservices
16
(2)
+18
1.9%
-0.8%
Sub-total
107
47
+60
3.4%
1.9%
Corporate & Other
(7)
(6)
-1
NM
NM
GROUP TOTAL
100
41
+59
3.2%
1.7%
NM: not material
Appendix 5: Pro forma adjusted EBITA
and adjusted EBITA margin by business segment
Pro forma 2022-23
H1
H2
12 months
(in € millions)
Adjusted EBITA
Adjusted EBITA margin
Adjusted
EBITA
Adjusted EBITA margin
Adjusted EBITA
Adjusted EBITA margin
Contract Catering
49
2.3%
(2)
-0.1%
47
1.1%
Multiservices
9
1.2%
29
3.5%
38
2.3%
Sub-total
58
2.0%
27
1.0%
85
1.5%
Corporate & Other
(9)
NM
(8)
NM
(17)
NM
GROUP TOTAL
49
1.7%
19
0.7%
68
1.2%
NM: not material
Appendix 6: Simplified cash flow
statement
Six months ended
March 31
(in € millions)
2024
2023
EBITDA
189
107
Purchases of and proceeds from sale of
property, plant and equipment and intangible assets
(43)
(32)
Change in operating working capital
83
(45)
Share of profit of equity-accounted
investees
-
-
Non-recurring income and expenses
impacting cash
(13)
(15)
Other non-cash movements
(1)
2
Repayments of lease liabilities (IFRS
16)
(41)
(33)
Operating free cash flow
174
(16)
Tax recovered (paid)
(5)
1
Free cash flow
169
(15)
Appendix 7: Consolidated financial
statements
Consolidated income statement
Six months ended
March 31
(in € millions)
2024
2023
Revenue
3,123
2,478
Purchase of raw materials and
consumables
(907)
(845)
Personnel costs
(1,675)
(1,255)
Share-based compensation expense
1
(3)
Other operating expenses
(293)
(223)
Taxes other than on income
(60)
(46)
Depreciation, amortization and provisions
for recurring operating items
(88)
(68)
Net amortization of intangible assets
recognized on consolidation
(13)
(8)
Recurring operating profit from
continuing operations
88
30
Share of profit of equity-accounted
investees
-
-
Recurring operating profit from
continuing operations including share of profit of equity-accounted
investees
88
30
Non-recurring income and expenses, net
(15)
(17)
Operating profit from continuing
operations including share of profit of equity-accounted
investees
73
13
Financial expenses
(61)
(39)
Financial income
9
4
Profit/(loss) from continuing
operations before income tax
21
(22)
Income tax
(20)
(3)
Net profit/(loss) for the period from
continuing operations
1
(25)
Net profit for the period from
discontinued operations
-
-
Net profit/(loss) for the
period
1
(25)
Attributable to:
Owners of the parent
1
(23)
Non-controlling interests
-
(2)
Six months ended
March 31,
(in €)
2024
2023
Earnings/(loss) per share
Earnings/(loss) per share – continuing
operations
Basic
-
(0.14)
Diluted
-
(0.14)
Earnings per share – discontinued
operations
Basic
-
-
Diluted
-
-
Total earnings/(loss) per share
Basic
-
(0.14)
Diluted
-
(0.14)
Consolidated balance sheet –
Assets
(in € millions)
At March 31, 2024
At September 30, 2023
Goodwill
1,670
1,680
Intangible assets
247
257
Property, plant and equipment
256
258
Right-of-use assets
196
216
Non-current financial assets
129
127
Fair value of derivative financial
instruments (*)
2
5
Deferred tax assets
82
84
Total non-current assets
2,582
2,627
Inventories
101
107
Trade and other receivables
953
975
Current income tax assets
13
12
Other current assets
75
67
Cash and cash equivalents (*)
81
45
Assets classified as held for sale
-
-
Total current assets
1,223
1,206
Total assets
3,805
3,833
(*) Included in the calculation of net
debt
Consolidated balance sheet – Equity and
liabilities
(in € millions)
At March 31, 2024
At September 30, 2023
Share capital
3
3
Reserves and retained earnings(1)
822
833
Translation reserve
2
11
Equity attributable to owners of the
parent
827
847
Non-controlling interests
-
(1)
Total equity
827
846
Long-term debt (*)
1,023
1,074
Long-term lease liabilities (*)
137
155
Fair value of derivative financial
instruments (*)
6
-
Provisions for pension and other
post-employment benefit obligations
80
74
Other long-term provisions
28
28
Other non-current liabilities
6
6
Total non-current liabilities
1,280
1,337
Trade and other payables
687
646
Due to suppliers of non-current assets
12
14
Accrued taxes and payroll costs
667
639
Current income tax liabilities
17
8
Short-term debt (*)
103
135
Short-term lease liabilities (*)
68
67
Short-term provisions
54
56
Contract liabilities
51
53
Other current liabilities
39
32
Liabilities classified as held for
sale
-
-
Total current liabilities
1,698
1,650
Total liabilities
2,978
2,987
Total equity and liabilities
3,805
3,833
Net debt
1,254
1,381
Net debt excluding fair value of
derivative financial instruments and debt issuance costs
1,256
1,393
(*) Included in the calculation of net
debt
Consolidated cash flow
statement
Six months ended
March 31
(in € millions)
2024
2023
Recurring operating profit including share
of profit of equity-accounted investees
88
30
Amortization and depreciation(1)
90
76
Provisions
11
1
EBITDA
189
107
Share of profit of equity-accounted
investees
-
-
Change in operating working capital
83
(45)
Non-recurring income and expenses
impacting cash
(13)
(15)
Interest and other financial expenses
paid
(48)
(32)
Tax recovered (paid)
(5)
1
Other non-cash movements
(1)
2
Net cash from operating activities –
continuing operations
205
18
Purchases of property, plant and equipment
and intangible assets
(46)
(35)
Proceeds from sale of property, plant and
equipment and intangible assets
3
3
Purchases of financial assets
(2)
(3)
Proceeds from sale of financial assets
1
-
Acquisitions of shares in consolidated
companies, net of cash acquired
(2)
-
Other cash flows from investing
activities
(1)
(1)
Net cash from/(used in) investing
activities – continuing operations
(47)
(36)
Proceeds from borrowings
14
51
Repayments of borrowings
(86)
(73)
Repayments of lease liabilities
(37)
(30)
Net cash from/(used in) financing
activities – continuing operations
(109)
(52)
Effect of exchange rate changes
3
(4)
Increase/(decrease) in net cash and
cash equivalents – continuing operations
52
(74)
Increase/(decrease) in net cash and
cash equivalents – discontinued operations
(1)
-
Net cash and cash equivalents at
beginning of period
(2)
59
Net cash and cash equivalents at end of
period
49
(15)
(1) Including amortization of advances on customer contracts
corresponding to €1 million in the six months ended March 31, 2023
and a non-material amount in the six months ended March 31, 2024
Appendix 8: Definitions of alternative performance
indicators
Organic growth in consolidated revenue: Growth in
consolidated revenue expressed as a percentage and adjusted for the
impact of (i) changes in exchange rates, using the calculation
method described in Chapter 4, Section 4.2 of the 2022-2023
Universal Registration Document, (ii) changes in accounting
policies, and (iii) changes in scope of consolidation.
Revenue retention rate: Based on the percentage of
revenue from the previous fiscal year, adjusted for the cumulative
year-on-year change in revenue attributable to contracts or sites
lost since the beginning of the previous fiscal year.
Adjusted EBITA: Recurring operating profit, including
share of profit of equity-accounted investees, adjusted for
share-based compensation (stock options and performance shares
granted by Group companies) and net amortization of intangible
assets recognized on consolidation.
The Group considers that this indicator best reflects the
operating performance of its businesses as it includes the
depreciation and amortization arising as a result of the capex
inherent to its business model. It is also the most commonly used
indicator in the industry and therefore enables meaningful
comparisons between the Group and its peers.
Adjusted EBITA margin: Adjusted EBITA as a percentage of
consolidated revenue.
Operating free cash flow: The sum of the following items
as defined in the 2022-2023 Universal Registration Document and
recorded either as individual line items or as the sum of several
individual line items in the consolidated cash flow statement:
- EBITDA;
- net capital expenditure (i.e., amounts paid as consideration
for property, plant and equipment and intangible assets used in
operations less the proceeds received from sales of these types of
assets);
- repayments of lease liabilities (IFRS 16);
- change in net operating working capital;
- share of profit of equity-accounted investees;
- non-recurring income and expenses impacting cash;
- other non-cash movements.
This indicator reflects cash generated by operations.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240515851628/en/
Press contact Silvine Thoma –
silvine.thoma@eliorgroup.com / +33 (0)6 80 87 05 54
Investor contact investor@eliorgroup.com
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