HighCo: 2021 annual earnings
Aix-en-Provence, 22 March 2022
(6.00 p.m.)
HIGHCO POSTS EXCELLENT RESULTS FOR
2021: RETURN TO BUSINESS GROWTH, SHARP RISE IN
PROFITABILITY (>20%) AND STRONG INCREASE IN PROPOSED
DIVIDEND
Return to business growth
- Full-year 2021
gross profit of €76.52 M, up 3.2% on a reported basis and
LFL1.
Strong growth in results and
profitability
- Adjusted headline
PBIT2 of €15.54 M, for a strong rise of 27.6%.
- Adjusted operating
margin2 of 20.3%, with a sharp increase of 390 basis
points.
- Adjusted
attributable net income3 of €8.71 M, for a sharp rise of
50.9%.
Strong cash
generation
-
Operating cash flow of €15.33 M (excluding IFRS 16), up
€2.33 M or 17.9%.
- Net cash
excluding operating working capital of €17.92 M at 31 December
2021, representing an increase of €4.5 M compared to 31
December 2020.
High
shareholder returns
- Dividend
of €0.32 per share to be proposed at the AGM in May 2022, for
a sharp 18.5% increase.
- Proposal
to cancel around 8% of treasury shares.
2022 Guidance
- Slight
business growth and increase in adjusted operating margin of 50
basis points.
-
Continued investment in the startup studio HighCo Venturi;
acquisitions and/or investments.
(€ M) |
2021 |
2020 |
2021/2020 Change |
Gross profit |
76.52 |
74.16 |
+3.2% |
Adjusted headline
PBIT2 |
15.54 |
12.18 |
+27.6% |
Adjusted operating
margin2 (%) |
20.3% |
16.4% |
+390
bps |
Recurring operating income |
14.82 |
12.18 |
+21.7% |
Attributable net income |
11.19 |
4.27 |
+161.9% |
Adjusted attributable net
income3 |
8.71 |
5.77 |
+50.9% |
Adjusted earnings per share3 (in €) |
0.42 |
0.28 |
+51.4% |
Net cash4 excluding
operating working capital |
17.92 |
13.42 |
+4.50
M€ |
Operating cash flow (excluding IFRS 16) |
15.33 |
13.00 |
+17.9% |
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).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 attributable net income: Attributable
net income excluding the net after-tax impact of performance share
plans (2021: no impact; 2020: income of €0.56 M), excluding
other operating income and expenses (2021: income of €2.46 M;
2020: no impact) and excluding net income or loss from assets held
for sale and discontinued operations (2021: income of €0.02 M;
2020: loss of €2.06 M); adjusted earnings per share based on
an average number of shares of 20,677,545 at 31 December 2021
and of 20,738,470 at 31 December 2020.4 Net cash (or net cash
surplus): Cash and cash equivalents less gross current and
non-current financial debt.
Didier Chabassieu, Chairman of the Management Board, stated,
“After two years of operating in a complex environment, I’m proud
of the work accomplished by our teams, which has enabled us to post
a very good financial performance in 2021. The Group registered a
return to growth (up 3.2%) driven by the growth in its digital
businesses (two-thirds of gross profit), especially Mobile
activities (up 6.8%). This growth comes with a significant rise in
headline PBIT and profitability. These very good results have led
HighCo to propose high shareholder returns and continue investing
in innovation. HighCo confirms its goal: being the key partner for
brands and retailers and leading by example in accelerating the
transformation of retail.”
2021 FINANCIAL PERFORMANCE
Return to business growth
The Group’s gross profit grew 3.2% to
€76.52 M for FY 2021.
This business growth was mainly driven by:
- Digital, up 2.6%,
which now accounts for more than two-thirds of business, especially
with the strong performance of
Mobile businesses (up 6.8%);
- Good performance in offline
businesses (up 4.5%), benefiting from a favourable comparison
base.
Broken down by region, France posted
gross profit of €66.45 M, up 3.3% in 2021,
representing 86.8% of the Group’s gross profit for the full year
2021. Driven by Mobile (up 7.2%), digital
businesses grew 2.4%, and their share represented 67.4% of gross
profit. Thanks to an extremely favourable comparison base, mainly
in Q2 (up 25.3%) offline businesses grew 5.1% for the financial
year.
International business also grew, 2.3%
to €10.07 M, accounting for 13.2% of the Group’s
gross profit. This business growth came both from Belgium
(up 2.1%) and from other countries (up 4.3%). Digital grew
3.3% for FY 2021 and accounted for 63.1% of gross profit.
Strong growth in results and
profitability
Business growth, combined with sound cost
control, led to a sharp 27.6% rise in adjusted headline
PBIT compared with 2020, at €15.54 M in
2021, with:
- A strong 34.1%
increase in adjusted headline PBIT in France to €13.42 M
(2020: €10.01 M);
- Virtually stable
adjusted headline PBIT for International businesses, at
€2.12 M (2020: €2.18 M).
Adjusted operating margin
(adjusted headline PBIT/gross profit) rose substantially by
390 basis points to 20.3% compared with 16.4% for
2020.
Growth in adjusted headline PBIT and stable
restructuring costs (2021: €0.71 M; 2020: €0.78 M) led to
a sharp increase of 21.7% in recurring operating income to
€14.82 M (2020: €12.18 M).
Given other operating income of €2.46 M due
to the fair value remeasurement of the earn-out recognised as part
of the Useradgents acquisition in 2018, 2021 operating
income came to €17.28 M, rising sharply by 41.9%.
The tax expense remained stable at €4.29 M
in 2021 (2020: expense of €4.24 M). The effective tax rate
fell considerably by 660 basis points to stand at 29.6% for
the period.
Adjusted attributable net income rose
very sharply by 50.9% to €8.71 M (2020:
€5.77 M). This led to reported attributable net income of
€11.19 M, also showing a very strong increase of 161.9% (2020
reported: €4.27 M).
The Group recorded adjusted EPS of
€0.42, for very sharp growth of 51.4% compared with
2020.
Strong cash generation
Cash flow amounted to €18.48 M, up 13.6%
compared with the figure as at 31 December 2020.Excluding the
impact of IFRS 16 – Leases, cash flow amounted to
€15.33 M, up 17.9% compared with the figure as at 31
December 2020.
Net cash at 31 December 2021 amounted to
€73.71 M, down €3.25 M compared with 31 December
2020.Excluding operating working capital (€55.79 M at 31
December 2021), net cash came to €17.92 M, up by
€4.5 M with respect to 31 December 2020.
HIGH SHAREHOLDER RETURNS
Strong rise in dividends
With this healthy financial performance, at the
next General Meeting scheduled for 16 May 2022, a
dividend payment of €0.32 per share will be proposed, representing
a sharp 18.5% increase (€0.27 per share paid in 2021 for
2020).
Proposal to cancel around 8% of treasury
shares
HighCo announces that it plans to cancel
8% of its share capital by the end of June 2022, through
the cancellation of treasury shares (excluding liquidity
contract).
As part of its policy on shareholder returns,
and as it is approaching the legal 10% limit on treasury shares,
the Management Board presented to the Supervisory Board its plan to
reduce the share capital by at least 8%, through the cancellation
of treasury shares acquired under share buyback programmes. As
announced above, in 2021 the Group recorded strong growth in its
profitability and posted a sound financial position with a high net
cash surplus. These factors support the grounds for this
decision.
The Supervisory Board, which met today,
authorised the Management Board to proceed with the operation.
The Management Board intends to implement this
authorisation by the end of June 2022, subject to the
following conditions:
- vote in favour of a resolution
authorising the cancellation of treasury shares within legal limits
at the Annual General Meeting to be held on 16 May;
- AMF’s decision to grant the request
of WPP (majority shareholder holding 34% of HighCo’s share capital)
for an exemption from the requirement to file a public offering;
and
- that there will be no future legal
recourse to challenge this decision.
It should be noted that WPP will refrain from
voting on the resolution to cancel treasury shares that will be
submitted at the Annual General Meeting.
HIGHCO AND THE TRANSFORMATION OF RETAIL
With the growth in e-commerce, development of m-commerce and
social media, and the emergence of Web3, the retail industry
continues to transform. Consumers are massively shifting towards
these new shopping formats. By moving forward with its innovation
strategy, HighCo is developing new offers and solutions to be the
key partner of choice for brands and retailers in the
transformation of the retail industry.
- In-store retail
remains where consumers prefer to shop, especially for food
shopping. But the channel must reinvent itself to transform stores
into spaces of experience, facilitate transactions and provide
access to promotions. With two new startups,
HighCo invents smart coupons (HighCo Coupon[AI])
and develops universal mobile discount coupons to
deliver seamless access to brand generosity (HighCo Nifty).
- In 2022, food
e-commerce is expected to grow to nearly 10% of market
share5, with the emergence of a plethora of new businesses to cover
delivery needs. That is why HighCo supports retailers like Leclerc,
in adapting in-store events and promotions to online
channels, and Franprix, in developing
shopping apps including “quick commerce”
features.
- With 23% growth
since 20206 mobile retail accounts for 50%
of e-commerce worldwide7. The development
of e-commerce apps that HighCo develops for
brands, especially digitally native vertical brands (DNVB) such as
État Pur, to help them design direct-to-consumer strategies. HighCo
has also adapted its expertise in SMS communication to offer a new
mobile commerce solution: SMS payment. This
secure, easy solution enables public transport users in large
cities to buy their tickets via SMS.
- Social media have
now moved into the retail sphere. Studies predict that spending via
social media will triple by 2025, from $490 billion to
$1,200 billion, and account for 17% of e-commerce worldwide8.
HighCo helps brands such as Arkopharma to deploy their influence
strategy by bringing in influencers and creating
storytelling. Still nascent just a few years ago,
livestream shopping is used to boost sales (up to
35% of conversion rates9 vs. 1.5% on e-commerce) and showcase a
brand’s products, such as in the weekly livestream shopping events
that HighCo organises for Casino. Organising livestream events
requires comprehensive expertise that ranges from recruiting
influencers to broadcasting, storytelling, video production, and
moderating content.
- Lastly, the emergence of Web3 and
the metaverse enables brands and retailers to explore new forms of
virtual retail. For example, the Group worked with the department
store chain Printemps to create an immersive shop and non-fungible
token (NFT). Through its startup studio, HighCo is building a
comprehensive offering to support its partners in this new form of
retail: creating a collection of NFTs, buying lands in the
metaverse and building buildings, developing interfaces with
e-commerce to enable transactions, etc. These are the
first technical building blocks in shaping the future of
retail.
HIGHCO AND CSR
Since its creation in 1990, HighCo has made social and
employee-related issues a central focus in its development,
especially its strong involvement in regions where it operates.
Innovation is part of the Group’s DNA. Society and regulations have
accelerated awareness of the role companies can play on these
issues.
The Group therefore aims to lead by
example in terms of social and environmental
performance.
This goal addresses three main challenges:
- encourage employees to buy in to
the company purpose;
- attract new talent;
- meet growing expectations from our
clients.
HighCo also plans to continue
employee related and social actions
already in place, namely:
- maintaining the balance of women in
management (48% at end-2021);
- keeping the Platinum rating from
EcoVadis, meaning that the Group is ranked in the top 1% of
companies in terms of CSR performance and responsible
purchasing;
- developing the HighCo Fund for
Entrepreneurship (skills sponsorship and financial aid);
- organising entrepreneurial
sponsorship (two startup winners of the Frédéric Chevalier
Award).
5 Kantar Consumers Day – Le e-commerce devrait
dépasser 10% en 2023 sur les PGC-FLS – Dec. 2021.6 Fevad – Bilan du
e-commerce en France en 2021 – Feb. 2022.7 PayPlug Study – Mobile
trends and uses in 2021 – Jan. 2018 to May 2021.8 Accenture
Research, Social Commerce – 2021.9 Emarketing.fr – iResearch,
Gartner or Deloitte benchmarks – 2021.
2022 GUIDANCE
This guidance was established on information
available, in a complex and rapidly changing environment due to the
war in Ukraine and ongoing Covid-19 pandemic.As such, the Group
points out that it is not directly or indirectly active in the
regions in conflict and confirms that its business has not been
impacted as at end-February 2022.
Under these conditions, HighCo forecasts for
2022:
- Slight growth in gross
profit (2021 gross profit: €76.52M);
- A rise in adjusted
operating margin (adjusted headline PBIT/gross profit) of
50 basis points (2021 adjusted operating margin:
20.3%).
The Group’s financial resources will be
allocated to:
- Innovation with the startup studio
HighCo Venturi (operating investments of more than €4 M);
- Capital expenditure of between
€2 M and €3 M (€1.06 M in 2021);
- Acquisitions and investments;
- Shareholder returns with the
payment of a much higher dividend (about €6.6 M) and
continuation of the share buyback programme, which will involve
more than €1 M (€1.31 million in 2021).
ANNUAL GENERAL MEETING OF 16 MAY
2022
HighCo’s joint Annual General Meeting will be
held at the head office in Aix-en-Provence on 16 May 2022
at 10.30 a.m.
(CET).In the health context due to the Covid-19 pandemic,
the rules and conditions for attending this meeting may change
depending how the situation develops and in line with
regulations.
The Supervisory Board examined the financial
statements for the year ended 31 December 2021. At the time of
writing, the audit of the consolidated financial statements has
been carried out. The certification reports will be issued once the
required specific verifications have been finalised in order to
file the universal registration document.
A conference call with analysts will take place on 23
March 2022 at 11:00 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 more than 500 employees and has achieved Platinum
status from EcoVadis, meaning
that the Group is ranked in the top 1% of companies in terms of CSR
performance and responsible purchasing.
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 annual earnings:
Wednesday, 23 March 2022 – 11:00 amQ1 2022 Gross Profit:
Tuesday, 26 April 2022Q2 and H1 2022 Gross Profit: Thursday, 21
July 20222022 Half-year Earnings: Wednesday, 24 August
2022Conference call on 2022 half-year earnings: Thursday, 25 August
2022Q3 and 9-month YTD 2022 Gross Profit: Wednesday, 19
October 2022Q4 and FY 2022 Gross Profit: Wednesday, 25 January
2023
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.
- HighCo CP Résultats 2021_FR_VDEF_EN
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