Highco:Half-year results 2021
Aix-en-Provence, 25 August 2021
(6.00 p.m.)
HIGHCO: RETURN TO
BUSINESS GROWTH IN H1 2021 AND STRONG GROWTH
IN HALF-YEAR EARNINGS;
2021 GUIDANCE OF
OPERATING MARGIN REVISED UPWARDS (FROM >17% TO
>19%)
Return to business growth in H1
2021
- Q2 2021 gross
profit of €19.21 M, up 8.1% on a reported basis and LFL1.
- H1 2021 gross
profit of €37.8 M, up 5.1% on a reported basis and LFL1.
- Business growth in
France (H1 up 4.9% LFL) and in International business (H1 up 5.9%
LFL).
- Digital businesses
grew slightly (H1 up 1.5% LFL) with a very favourable comparative
base for offline businesses (H1 up 12.2% LFL).
Earnings and profitability showing
strong growth
- Adjusted headline
PBIT2 of €9.5 M, up 24.1%.
- Adjusted operating
margin2 of 25.1%, with a sharp increase of 380 basis
points.
- Adjusted
attributable net income4 of €5.87 M, with a sharp rise of
38.5%.
Financial position remains
strong
-
Operating cash flow of €9.57 M, up 15.1%.
- Net cash
excluding operating working capital of €11.14 M at 30 June
2021, down €2.29 M compared to 31 December 2020.
2021 Guidance
- Slight organic
growth in H2 2021 gross profit.
- Adjusted operating
margin2 revised with a significant increase from more than 17% to
more than 19%.
(€ M) |
H1 2021 |
H1 2020 restated |
H1 2021/ H1 2020
restatedChange |
Gross profit |
37.80 |
35.98 |
+5.1% |
Adjusted headline PBIT2 |
9.50 |
7.65 |
+24.1% |
Adjusted operating margin2
(%) |
25.1% |
21.3% |
+380 bp |
Adjusted recurring operating income3 |
9.28 |
7.48 |
+24.2% |
Recurring operating income |
9.28 |
8.26 |
+12.5% |
Attributable net income |
5.89 |
4.13 |
+42.6% |
Adjusted attributable net
income4 |
5.87 |
4.24 |
+38.5% |
Adjusted earnings per share4 (in €) |
0.28 |
0.20 |
+38.0% |
Net cash5 excluding operating working capital |
11.14 |
13.426 |
(€2.29 M) |
Operating cash flow |
9.57 |
8.31 |
+15.1% |
1 Like for like: Based on a comparable scope and
at constant exchange rates (i.e. applying the average exchange rate
over the period to data from the compared period).Furthermore, in
application of IFRS 5 – Non-current Assets Held for Sale and
Discontinued Operations, Shelf Service businesses were reported as
discontinued operations as of the fourth quarter of 2020. For
reasons of consistency, the data reported for H1 2020 has been
restated to account for the impact of Shelf Service. As a result,
like-for-like data is equal to restated data in H1 2020.2 Adjusted
headline profit before interest and tax: Recurring operating income
before restructuring costs and excluding the impact of performance
share plans. Adjusted operating margin: Adjusted headline
PBIT/Gross profit.3 Adjusted recurring operating income: Recurring
operating income excluding the impact of performance share plans.4
Adjusted attributable net income: Attributable net income excluding
the net after-tax impact of performance share plans (H1 2021:
none; H1 2020: income of €0.56 M) and excluding net
income or loss from assets held for sale and discontinued
operations (H1 2021: income of €0.02 M; H1 2020:
loss of €0.67 M); adjusted earnings per share based on an
average number of shares of 20,751,387 at 30 June 21 and of
20,679,528 at 30 June 2020.5 Net cash (or net cash surplus):
Cash and cash equivalents less gross current and non-current
financial debt.6 At 31 December 2020.
Didier Chabassieu, Chairman of the Management
Board, stated,
“Thanks to a return to business growth and sound
cost control, HighCo posted strong growth in half-year earnings.
This good performance enables the Group to continue
accelerating its innovation strategy driven by its startup studio
HighCo Venturi. Thanks to all its projects, the Group aims to
become a leader in the shift towards digital promotions.”
FINANCIAL PERFORMANCE IN H1
2021
Return to business growth in H1
2021
After a healthy Q1 2021 (up 2.2% like for
like), HighCo confirmed its return to growth in Q2 (up 8.1%
like for like).As a result, the
Group’s businesses grew 5.1% in
H1 2021 to €37.8 M.
Digital business, up 1.5% in
the first half of the year, was driven by Mobile activities (up
7.3%). Digital accounts for 64.3% of
HighCo’s total business. Offline
businesses benefited from a very favourable comparative base,
posting a strong recovery with growth of 12.2%.
Broken down by region, France posted
gross profit of €32.48 M, up 4.9% in H1 2021,
representing 85.9% of the Group’s gross profit for the first half
of 2021. Digital businesses grew slightly by 0.8% over the period,
and their share represented 64.7% of gross profit.
International business also grew 5.9% to
€5.32 M, accounting for 14.1% of the Group’s gross
profit. Gross margin in Belgium grew 6.3% to €4.75 M. Digital
business in the country rose 7.4% compared with H1 2020 on a
like-for-like basis, for a share of 57.5% in gross profit. Spain
and Italy are fully digital and showed growth of 2.7% to
€0.57 M.
Earnings and profitability showing
strong growth
Business growth, combined with sound cost
control, led to a sharp
24.1% rise in adjusted
headline PBIT compared with the figures for H1 2020
restated for the sale of HighCo Shelf Service, at
€9.5 M in H1 2021, with:
- A 25.4% increase
in adjusted headline PBIT in France to €8.03 M (H1 2020
restated: €6.4 M);
- Higher adjusted
headline PBIT for International businesses, up 17.5% to
€1.47 M (H1 2020 restated: €1.25 M).
Adjusted operating margin
(adjusted headline PBIT/gross profit) rose 380 basis
points compared with restated figures for H1 2020
(21.3%), and 770 basis points compared with the
reported figures for H1 2020 (17.4%), to
25.1%.
Growth in adjusted headline PBIT and stable
restructuring costs (H1 2021: €0.22 M; H1 2020 restated:
€0.18 M) led to a sharp
increase of 24.2% in adjusted recurring
operating income to €9.28 M (H1 2020 restated:
€7.48 M).
The tax expense remained stable at €2.72 M
in H1 2021 (H1 2020 restated: expense of €2.76 M). The
effective tax rate fell by more than 400 basis points to stand
at 29.8% for the period.
Adjusted attributable net income rose
significantly by 38.5% to €5.87 M (H1 2020
restated: €4.24 M). This led to reported attributable net
income of €5.89 M, also showing a strong increase of 42.6%
(H1 2020 reported: €4.13 M).
The Group reported adjusted half-year
EPS of €0.28, up significantly by 38% from the restated
figure for H1 2020.
Financial position remains
strong
Cash flow amounted to €9.57 M, up 15.1%
compared with the restated figure as at 30 June 2020.
Net cash at 30 June 2021 amounted to
€62.03 M, down €14.93 M compared with
31 December 2020. Excluding operating working capital
(€50.89 M at 30 June 2021), net cash came to
€11.14 M, down by
€2.29 M with
respect to 31 December 2020.
UPDATE ON CURRENT BUSINESS
ENVIRONMENT
Food retail continues to
evolveAfter 18 months since the beginning of the
health crisis, which has disrupted consumer and shopping habits, a
few major trends should be noted:
- Click & collect
continues to grow and currently accounts for nearly 10% of
the market1. Walk-up click & collect services have
emerged, providing consumers in urban areas with access to
a larger variety of products and prices similar to those practised
at hypermarkets.
- Quick commerce and dark
stores (small warehouses) have developed, guaranteeing
ultra-fast delivery across a limited urban geographical area.
Social media are revolutionising
retail
With 75%2 of the French population connected
every day, social media play an increasingly important role in the
daily lives of French people and in the marketing
strategies of brands and retailers:
- More than 30%3 of French people
have already bought an item via social media.
- In addition, 20%3 of the French follow
influencers to benefit from their tips or from
promotions (60%4 in China).
- And 30%4 of French consumers say
they are interested in a programme format that has only recently
emerged in France: “live shopping”.
ACCELERATION OF HIGHCO’S INNOVATION
STRATEGY
Through its startup studio HighCo Venturi,
HighCo continues to invest with the goal of creating
five startups between now and
2025:
- Mobilising significant financial
and human resources, the Group aims to become a leader in
paperless promotions.
- With the help of the multi-skilled
team 100% dedicated to the HighCo Venturi Startup Studio, the ideas
sourced follow an established process to move through the
opportunity study, launch and acceleration phases.
Three projects have already been initiated,
benefiting from investment in OPEX over the full year of
more than €4 M, of which €2 M in H1 2021, with
nearly 40 employees mobilised.
The projects initiated are:
- Universal digital discount
coupons.
The startup HighCo Nifty develops technology
used for accelerated and secure coupon processing. Implementation
and use are smoother (storage on mobile devices, scan at check-out,
multi-retailer distribution across all channels, etc.)
Developed from a SaaS platform, HighCo
Coupon[AI] lets brands manage their customised activation strategy
independently and efficiently (generosity management, data
collection and activation, immediate reporting).
For consumers, the shopping experience is enhanced with
personalised coupons stored on their mobile device.
HighCo Flowcart is used to create promotional
campaigns on social media under a SaaS model. Campaigns are
measurable and can be activated on either a local level or
nationwide.
In line with the key market trends, especially
involving social media, other projects are also under
review at the startup studio.
Sources: 1 Online market share in sales of
consumer goods/self-service produce, as a % – LSA Expert, April
2021 / 2 Wearesocial Hootsuite infographic, moderator blog, January
2021 / 3 Barometer of new consumer trends – Wavestone, April 2021 /
4 Quantitative study conducted online for ALTAVIA Shopper mind –
OpinionWay, February 2021.
2021 GUIDANCE
With the strong growth in its half-year results,
the Group has revised its guidance for 2021 as follows:
- Slight growth in gross
profit in the second half (H2 2020 gross profit:
€38.19 M; FY 2020 gross profit: €74.16 M);
- Rise in adjusted operating
margin (adjusted headline PBIT/gross profit) revised
from more than 17% to more than 19% (2020 adjusted
operating margin: 16.4%).
A conference call with analysts will take place on 26 August
2021 at 11 a.m. (CET). The presentation will be available at
the beginning of the meeting on the Company’s website
(www.highco.com) under Investors > Financial Information >
Financial analysts meetings.
About HighCo
As an expert in data marketing and
communication, HighCo continuously innovates to work with brands
and retailers in meeting the retail challenges of
tomorrow.Listed in compartment C of Euronext
Paris, and eligible for SME equity savings plans (“PEA-PME”),
HighCo has nearly 600 employees and since 2010 has been
included in the Gaia Index, a selection of 70 responsible
Small and Mid Caps.
Your contacts
Cécile
Collina-Hue Cynthia
LeratManaging
Director Press
Relations+33 1 77 75 65
06 +33
1 77 75 65
16comfi@highco.com c.lerat@highco.com
Upcoming events
Publications take place after market
close.
Conference call on 2021 half-year earnings:
Thursday, 26 August 2021 (11.00 a.m. CET)Q3 and 9-month
YTD 2021 Gross Profit: Wednesday, 20 October 2021Q4 and FY
2021 Gross Profit: Wednesday, 19 January 2022
HighCo is a component stock of the indices CAC®
Small (CACS), CAC® Mid&Small (CACMS), CAC® All-Tradable (CACT),
Euronext® Tech Croissance (FRTPR) and Enternext® PEA-PME 150
(ENPME).ISIN: FR0000054231 Reuters: HIGH.PA Bloomberg: HCO FP For
further financial information and press releases, go to
www.highco.com.
This English
translation is for the convenience of English-speaking readers.
Consequently, the translation may not be relied upon to sustain any
legal claim, nor should it be used as the basis of any legal
opinion. HighCo expressly disclaims all liability for any
inaccuracy herein.
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