+5.4% increase in revenue Sales volumes
return to their 2019 level Growth in adjusted EBITDA to €678
million (+8.4%) Reduction in CO2 emissions in line with CSR
objectives
Regulatory News:
Verallia (Paris:VRLA):
Highlights
- Increase in revenue of +5.4% to €2.674 billion (+6.8% at
constant exchange rates and scope)(1) compared to 2020
- Growth in adjusted EBITDA to €678 million in 2021, from
€626 million in 2020 (+8.4%)
- Improvement in adjusted EBITDA margin to 25.4% in 2021
compared to 24.7% in 2020 (+68 bps vs 2020)
- Net income(2) at €249 million compared to €210 million
in 2020 (+19% vs 2020) and earnings per share(2) of
€2.01
- Reduction in net debt leverage to 1.9x 2021 adjusted
EBITDA, against 2.0x as of 31 Dec. 2020
- Reduction in Scope 1 & 2 CO2 emissions of -3.6% vs
2020 and external cullet usage(3) rate of 55% (+3.4
points vs 2020) in 2021
- Proposal to pay a dividend per share of €1.05(4)
(1) Growth in revenue at constant exchange rates and scope
excluding Argentina of +5.0% in 2021 compared to 2020. (2) Net
income for 2021 includes an amortisation expense for customer
relationships recognised upon the acquisition of Saint-Gobain's
packaging business in 2015, of €43 million and €0.36 per share (net
of taxes). By not taking this expense into account, net income
would be €292 million and €2.37 per share. This expense was €43
million and €0.37 per share in 2020. (3) Recycled glass. (4)
Subject to the approval of the Annual General Shareholders' Meeting
which will take place on 11 May 2022.
"Verallia publishes its 2021 results, which are in line with its
forecasts. Annual sales volumes returned to their 2019 pre-crisis
level, as the Group took advantage of the momentum of the glass
market thanks to the quality of its products and its excellent
flexibility. In addition, thanks to the operating leverage related
to the increase in volumes and improved operational efficiency
(Performance Action Plan - PAP), adjusted EBITDA showed signs of
solid growth despite the highly inflationary environment of the
second half of the year. After paying dividends and significant
share buybacks, the Group continued to reduce its financial
leverage. In addition, Verallia is well in line with the CO2
emission reduction and cullet usage targets it released when
issuing Sustainability-linked bonds (SLB). I would like to give a
warm welcome to Patrice Lucas, future Chief Executive Officer, who
I will be delighted to work alongside leading the Group as
Chairman", commented Michel Giannuzzi, Chairman and CEO of
Verallia.
Revenue
Revenue breakdown by region
In € million
2021
2020
% Change
Of which is organic growth
(i)
Southern and Western Europe
1,832.2
1,744.5
+5.0%
+5.1%
Northern and Eastern Europe
537.6
554.4
-3.0%
-1.8%
Latin America
304.2
237.0
+28.3%
+39.3%
Group Total
2,674.0
2,535.9
+5.4%
+6.8%
(i) Revenue growth at constant exchange rates and scope. Revenue
growth at constant exchange rates is calculated by applying the
average exchange rates of the comparative period to revenue for the
current period of each Group entity, expressed in its reporting
currency. The growth in revenue at constant exchange rates and
scope excluding Argentina was up +5.0% in 2021 compared to
2020.
Revenue in 2021 totalled €2.674 billion, a strong 5.4%
increase on a reported basis compared to last year. The impact
of exchange rates was -1.3% in 2021 (-€33 million),
primarily concentrated in the first half of the year. It was in
large part linked to the depreciation of the Argentine peso and the
Brazilian real and, to a lesser extent, the Russian rouble. In the
fourth quarter, the impact of exchange rates was positive at +2.2%
(+€13 million).
At constant exchange rates and scope, revenue grew
+6.8% over the year (and +5.0% excluding Argentina), with an
acceleration in the fourth quarter leading to organic growth of
+10.2% (and +9.4% excluding Argentina). After a volatile 2020,
which formed an extremely variable basis for comparison from one
quarter to another, Group sales volumes in 2021 recorded growth,
returning to their 2019 pre-Covid level.
All product categories recorded increased sales over the year,
with the exception of non-alcoholic beverages and food jars. Those
two categories experienced strong momentum in 2020, thanks to the
specific context of various lockdowns, and still showed growth in
the fourth quarter of 2021. Sparkling wine and spirits rebounded
sharply over the year as exports to Asia and the United States
picked up.
An increase in sales prices in Latin America and a good product
mix over the year at Group level also contributed to the growth in
revenue.
By region, revenue for 2021 can be broken down as follows:
- Southern and Western Europe saw
revenue grow by +5.0% on a reported basis and by +5.1% at constant
exchange rates and scope. The region took full advantage of new
production capacities in the second half of the year. All product
categories were up for the year, except food jars. Still wine and
spirits recorded strong growth, after a difficult year in 2020.
Sparkling wine has recovered well: the champagne market indeed
achieved a record year in 2021, recording higher activity than in
2019, while prosecco continues to be popular in Italy and for
exports. Beer is also doing well in all countries. Sales prices
remained stable in the region.
- In Northern and Eastern Europe,
revenue on a reported basis decreased by -3.0% and by -1.8% at
constant exchange rates and scope. Exchange rate variations had a
negative impact of -1.2%, as a result of the depreciation of the
Russian rouble. The decrease in revenue was concentrated in the
first half of the year, with an increase in sales in the region in
the second half of the year, which was particularly pronounced in
sparkling wine and spirits. Sales prices also remained stable over
the year.
- In Latin America, the Group reaped
the benefits of having increased capacity in 2020. Revenue shows a
strong reported increase of +28.3% and +39.3% organic growth.
Annual revenue grew in all product categories except food jars. In
addition, previous increases in selling prices in the region –
particularly in Argentina in response to local hyperinflation –
also contributed to the strong growth in revenue. Sales volumes, on
the other hand, fell slightly in Argentina in the second half of
the year, impacted by a fire in the third quarter which temporarily
disrupted customer supply over the six-month period.
Adjusted EBITDA
Breakdown of adjusted EBITDA by region
In € million
2021
2020
Southern and Western Europe
Adjusted EBITDA (i)
452.8
419.1
Adjusted EBITDA margin
24.7%
24.0%
Northern and Eastern Europe
Adjusted EBITDA (i)
117.0
126.4
Adjusted EBITDA margin
21.8%
22.8%
Latin America
Adjusted EBITDA (i)
108.2
80.1
Adjusted EBITDA margin
35.6%
33.8%
Group Total
Adjusted EBITDA (i)
678.1
625.7
Adjusted EBITDA margin
25.4%
24.7%
(i) Adjusted EBITDA is calculated on the basis of operating
profit adjusted for depreciation, amortisation and impairment,
restructuring costs, acquisition and M&A costs,
hyperinflationary effects, management share ownership plans,
subsidiary disposal‐related effects and contingencies, plant
closure costs and other items.
Adjusted EBITDA increased by +8.4% in 2021 (and +10.2% at
constant exchange rates and scope) to €678 million. The
unfavourable effect of exchange rates, concentrated in the
first half of the year, reached -€11 million in 2021 and is mainly
attributable to the depreciation of Latin American currencies as
well as the depreciation of the Russian rouble.
Activity improved over the year thanks to higher sales volumes
as well as a decrease in destocking compared to last year, which
more than offset the additional fixed costs related to the start-up
of two new furnaces (in Spain and Italy) in H1. The inventory level
reached at the end of December was still lower than expected, due
to the very high activity level at the end of the year.
Verallia generated a slightly positive inflation spread1
at Group level thanks to a strong product mix effect and despite
the very sharp rise in the cost of energy, transportation and
packaging. However, the inflation spread is negative in Europe,
where sales prices have remained stable compared to 2020, thus not
offsetting the strong increase in certain costs. On the other hand,
inflation spread remains positive in Latin America thanks to
dynamic sales price increases in the region.
The net reduction in cash production costs (PAP) once again
strongly contributed to the improvement in EBITDA of €40 million
(i.e. 2.4% of cash production costs).
The adjusted EBITDA margin increased to 25.4% from
24.7% in 2020.
By region, adjusted EBITDA for 2021 breaks down as follows:
- Southern and Western Europe
reported an adjusted EBITDA of €453 million (vs €419 million in
2020) and a margin of 24.7% compared to 24.0%. Higher sales volumes
and a positive product mix drove the increase in EBITDA. However,
the inflation spread turned negative in the second half of the year
due to the sharp rise in certain costs. Ultimately, the region's
industrial performance was also good, despite the difficulties
encountered by France at the start of the year due to social
movements linked to the transformation plan, which affected
production.
- In Northern and Eastern Europe,
adjusted EBITDA was €117 million (vs €126 million in 2020),
decreasing its margin to 21.8%, compared to 22.8%. This decline is
mainly attributable to the negative inflation spread linked to the
sharp rise in factor costs, as well as to the slight decline in
volumes in the first half the year. In addition, the region's
industrial performance is in line with the cost reduction
objective.
- In Latin America, adjusted EBITDA
amounted to €108 million (vs €80 million in 2020), achieving a
margin of 35.6% compared to 33.8%. This excellent performance is
due to the increase in sales volumes in a highly dynamic market,
combined with a positive inflation spread and solid industrial
performance. Additionally, in the first half of the year, Brazil
benefited from the decision of the Brazilian Federal Supreme Court
on the Tax on Commerce and Services (ICMS), the positive impact of
which was offset by a fire in Argentina in the third quarter.
The increase in net income to €249 million (and
€2.01 per share) is mainly due to the improvement in adjusted
EBITDA, which more than offset the increase in financial expenses
and income tax. Net income for 2021 includes, as it does every
year, an amortisation expense for customer relationships,
recognised upon the acquisition of Saint-Gobain's packaging
business in 2015, of €43 million et €0.36 per share (net of taxes).
By not taking this expense into account, net income would be
€292 million and €2.37 per share. This expense was €43 million
and €0.37 per share in 2020.
The capital expenditure recorded amounted to €256
million (i.e. 9.6% of total revenue), compared to €251 million
in 2020. These investments consist of €218 million of recurring
investments (compared with €203 million in 2020) and €38 million of
strategic investments (vs €47 million in 2020) mainly for the
building of a new furnace in Brazil on the Jacutinga site and the
CO2 emissions reduction capex.
The operating cash flow2 came in much higher at €502
million, compared to €442 million in 2020, thanks to the growth
in adjusted EBITDA as well as a sharp drop in the working capital
requirement. Indeed, in terms of the number of days of sales
compared to the end of December 2020, inventory remained at a very
low level given the strong activity, while late payments remain
extremely low.
Free cash-flow3 totalled €329 million, up compared
to 2020.
Very solid balance sheet
Verallia improved its net debt ratio in 2021. At the end of
December 2021, Verallia's net debt totalled €1.268 billion,
after three buyback operations by the Group of its own shares (€221
million) and the payment of €114 million in dividends in July. The
debt ratio was 1.9x 2021 adjusted EBITDA, compared with 2.0x
at the end of December 2020.
Finally, in order to diversify its funding sources and in line
with its ESG strategy unveiled in 2021, Verallia successfully
placed two issues of "Sustainability-Linked" bonds:
- for a total of €500 million with a 7-year
maturity and an annual coupon of 1.625% on 14 May 2021, - for a
total of €500 million with a 10-year maturity and an annual coupon
of 1.875% on 10 November 2021.
With two Sustainability-Linked bond issues in less than a year,
Verallia demonstrates that its creditworthiness is regarded very
favourably by investors, bolstered by its leadership in terms of
sustainable development in the glass packaging sector in
Europe.
The Group still had significant liquidity4 of €844
million as of 31 December 2021.
Share buyback
In 2021, Verallia participated in three accelerated private
placements carried out by Apollo in the gradual sale of its
remaining stake in the Group.
Verallia thus acquired 2.1 million shares for €60 million on 5
March 2021. These shares have been kept and are used to cover
employee share ownership programmes (the sixth of which ended on 24
June 2021) and Group performance share plans. On 9 June 2021,
Verallia bought back 1.6 million shares for €49 million. These
shares were cancelled on 24 June 2021. Finally, on 3 November 2021,
Verallia bought back circa 3.7 million shares for €112 million.
These shares were kept.
As a result of these three transactions, Verallia now holds
5,517,943 of its own shares, i.e. 4.51% of its capital.
Sustainable development
indicators
Verallia's "Scope 1 and 2" CO2 emissions totalled 2,833
kt CO2 for the year 2021, a decrease of -3.6% compared to
2020 emissions, which totalled 2,941 kt CO2. Verallia is therefore
in line with its trajectory for reducing its "Scope 1 and 2" CO2
emissions by 46% in absolute terms by 2030 (reference year
2019)5.
In addition, the external cullet usage rate6 reached
55.0% in 2021, compared to 51.6% in 2020: a significant
improvement of 3.4 points.
Changes in governance
During their meeting of 6 December 2021, taking note of Mr
Michel Giannuzzi's desire to see evolve his responsibilities within
the Group and with a view to applying best governance practices,
the Board of Directors decided to separate the functions of
Chairman of the Board of Directors and Chief Executive Officer,
with effect from the close of the Annual General Shareholders'
Meeting of 11 May 2022. Mr Michel Giannuzzi will remain Chairman of
the Board of Directors and Mr Patrice Lucas will be appointed Chief
Executive Officer and Board member on May 11, 2022.
Mr Patrice Lucas joined Verallia on 1 February 2022 as Deputy
Chief Executive Officer.
In addition to the appointment of Mr. Patrice Lucas as Board
member, will also be submitted to the vote at the General Meeting
of Shareholders of May 11, 2022, the appointment of Mr. Didier
Debrosse as independent Board member and the appointment of a
member representing the employees shareholders.
Finally, the Board of Directors having noted the resignation of
Mr. José Arozamena (independent Board member) and the election of
Mr. Xavier Massol (Board member representing the employees), the
composition of the Board’s committees is now the following:
- Audit
Committee: Ms Marie-José Donsion (Chairwoman), Brasil
Warrant Administração de Bens e Empresas S.A. (represented by Ms
Marcia Freitas) and Mr Pierre Vareille; - Compensation Committee: Ms Cécile Tandeau de
Marsac (Chairwoman), BW Gestão de Investimentos Ltda. (represented
by Mr João Salles), Mr Dieter Müller and Mr Pierre Vareille; -
Nomination Committee: Ms Cécile
Tandeau de Marsac (Chairwoman), BW Gestão de Investimentos Ltda.
(represented by Mr João Salles), Ms Virginie Hélias and Mr Pierre
Vareille; - Sustainable Development
Committee: Ms Virginie Hélias (Chairwoman), Bpifrance
Investissement (represented by Mr Sébastien Moynot), Mr Michel
Giannuzzi, Mr Xavier Massol and Mr Dieter Müller; and -
Strategic Committee: Mr Pierre
Vareille (Chairman), BW Gestão de Investimentos Ltda. (represented
by Mr João Salles) and Mr Michel Giannuzzi.
2021 dividend
During their meeting on 16 February 2022, the Verallia Board of
Directors decided to propose the payment of a dividend of €1.05 per
share in cash for the 2021 financial year. This amount will be
subject to approval of the Annual General Shareholders' meeting
which will take place on 11 May 2022.
2022 Outlook
Provided that the situation linked to the COVID‐19 pandemic does
stabilize, that the inflation in costs and the geopolitical context
do not deteriorate further, Verallia is expecting a sharp growth in
its annual revenue.
In the current environment of accelerating inflation since the
second half of 2021, Verallia anticipates a significant increase in
its production costs in 2022, of which energy is a major
factor.
Despite this highly inflationary climate, the Group is aiming
for an increase in adjusted EBITDA to a level above €700 million.
Adjusted EBITDA margin percentage will be mathematically reduced
due to the dilutive impact of the strong revenue growth.
Verallia is still implementing its ESG roadmap and reiterates
the ambitious financial and environmental objectives it announced
on 7 October 2021, which are recapped below.
Capital Markets Day on 7 October 2021
and confirmation of the medium-term objectives
released:
On 7 October, Verallia took a vital step in its ESG
strategy by setting new goals aligned with the objective
of limiting global warming to 1.5°C:
- 46% reduction in Scope 1 and 2 emissionsby 2030 in
absolute terms (base year 2019)7
- Scope 3 emissions maintained below 40% of total
emissions in 2030
- Net Zero in 2050 for Scope 1 and 2 emissions
The Group has also set new Medium-Term Financial Targets for
2022–2024:
2022–2023–2024
Assumptions
Organic Sales Growth8
+4-6% CAGR
- From ca half volume and half
price/mix
- Moderate inflation in raw
material and energy costs after 2022
Adj. EBITDA margin
28%-30% in 2024
- Positive price/cost spread
- Net PAP > 2% of production
cash cost (i.e. > €35m per annum)
Cum. Free Cash Flow9
ca €900m over 3 years
- Recurring and strategic Capex @
ca 10% of sales,
- Including CO2-related capex and
3 new furnaces by 2024
Earnings per Share
(excl. PPA10)
ca €3 in 2024
- Average cost of financing
(pre-tax) @ ca 2%
- Effective tax rate @ ca 27%
Shareholder Return
Policy
Dividend / share growth > 10%
per annum +
Accretive share buy-backs
- Net income growth > 10% per
annum
- Investment grade trajectory
(leverage < 2x)
The Verallia Group's consolidated financial statements for the
financial year ended 31 December 2021 were approved by the Board of
Directors on 16 February 2022. The consolidated financial
statements have been audited by the Statutory Auditors.
An analysts' conference call will be held on Thursday, 17
February 2022 at 9.00 am (CET) via an audio webcast service (live
and replay) and the results presentation will be available on
www.verallia.com.
Financial calendar
- 20 April 2022: financial results
for Q1 2022 – Press release after
market close and conference call/presentation the following
morning at 9.00 am CET.
- 11 May 2022: Annual General
Shareholders' Meeting.
- 27 July 2022: results for H1 2022
– Press release after market
close and conference call/presentation the following morning
at 9.00 am CET.
- 19 October 2022: financial results
for Q3 2022 – Press release after
market close and conference call/presentation the following
morning at 9.00 am CET.
About Verallia – At Verallia, our purpose is to
re-imagine glass for a sustainable future. We want to redefine how
glass is produced, reused and recycled, to make it the world's most
sustainable packaging material. We are joining forces with our
customers, suppliers and other partners across the value chain to
develop beneficial and sustainable new solutions for all. With
around 10,000 employees and 32 glass production facilities in 11
countries, we are the European leader and the world's third-largest
producer of glass packaging for beverages and food products. We
offer innovative, customised and environmentally friendly solutions
to over 10,000 businesses worldwide. In 2021, Verallia produced
more than 16 billion glass bottles and jars and posted revenue of
€2.6 billion. Verallia is listed on compartment A of the regulated
market of Euronext Paris (Ticker: VRLA – ISIN: FR0013447729) and is
included in the following indices: SBF 120, CAC Mid 60, CAC Mid
& Small and CAC All-Tradable. For more information, visit
www.verallia.com
Follow us on LinkedIn, Twitter, Facebook and YouTube
Disclaimer
Certain information included in this press release does not
constitute historical data but constitutes forward-looking
statements. These forward-looking statements are based on current
beliefs, expectations and assumptions, including, without
limitation, assumptions regarding Verallia's present and future
business strategies and the economic environment in which Verallia
operates. They involve known and unknown risks, uncertainties and
other factors, which may cause actual performance and results to be
materially different from those expressed or implied by these
forward-looking statements. These risks and uncertainties include
those discussed and identified in Chapter 3 "Risk Factors" in the
Universal Registration Document approved by the AMF and available on the Company's website
(www.verallia.com) and the AMF's website (www.amf-france.org).
These forward-looking information and statements are no guarantee
of future performance.
This press release includes only summary information and does
not purport to be comprehensive.
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Verallia SA, as data controller, processes personal data for the
purpose of implementing and managing its internal and external
communication. This processing is based on legitimate interests.
The data collected (last name, first name, professional contact
details, profiles, relationship history) is essential for this
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Verallia SA ensures that the appropriate guarantees are obtained in
order to supervise these data transfers outside of the European
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right to restrict the processing of your data. To exercise one of
these rights, please contact the Group Financial Communication
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you may submit a complaint to CNIL (Commission nationale de
l'informatique et des libertés — French regulatory body).
APPENDICES
Key figures
In € million
2021
2020
Revenue
2,674.0
2,535.9
Reported growth
+5.4%
-1.9%
Organic growth
+6.8%
+2.1%
of which Southern and Western Europe
1,832.2
1,744.5
of which Northern and Eastern Europe
537.6
554.4
of which Latin America
304.2
237.0
Cost of sales
(2,042.4)
(1,968.2)
Selling, general and administrative
expenses
(173.9)
(160.8)
Acquisition-related items
(59.7)
(60.4)
Other operating revenue and expenses
(4.9)
(30.1)
Operating profit
393.1
316.4
Finance costs – net
(56.8)
(45.8)
Profit (loss) before tax
336.3
270.6
Income tax
(89.4)
(62.4)
Share of net profit (loss) of
associates
2.4
1.4
Net income (i)
249.3
209.6
Earnings per share (i)
€2.01
€1.67
Adjusted EBITDA (ii)
678.1
625.7
Group Margin
25.4%
24.7%
of which Southern and Western Europe
452.8
419.1
Southern and Western Europe margin
24.7%
24.0%
of which Northern and Eastern Europe
117.0
126.5
Northern and Eastern Europe margin
21.8%
22.8%
of which Latin America
108.2
80.1
Latin America margin
35.6%
33.8%
Net borrowings at end of period
1,268
1,279
Last 12 months adjusted EBITDA
678.1
625.7
Net debt/last 12 months adjusted
EBITDA
1.9x
2.0x
Total capex (iii)
256.3
250.5
Cash conversion (iv)
62.2%
60.0%
Change in operating working capital
80.5
67.0
Operating cash flow (v)
502.3
442.1
Free Cash-Flow (vi)
329.3
315.7
Strategic investments (vii)
38.1
47.1
Recurring investments (viii)
218.2
203.4
(i) Net income for 2021 includes an amortisation expense for
customer relationships recognised upon the acquisition of
Saint-Gobain's packaging business in 2015, of €43 million and €0.36
per share (net of taxes). By not taking this expense into account,
net income would be €292 million and €2.37 per share. This expense
was €43 million and €0.37 per share in 2020. (ii) Adjusted EBITDA
is calculated on the basis of operating profit adjusted for
depreciation, amortisation and impairment, restructuring costs,
acquisition and M&A costs, hyperinflationary effects,
management share ownership plans, subsidiary disposal-related
effects and contingencies, plant closure costs and other items.
(iii) Capex (capital expenditure) represents purchases of property,
plant and equipment and intangible assets necessary to maintain the
value of an asset and/or adapt to market demand or to environmental
and health and safety constraints, or to increase the Group’s
capacity. It excludes the purchase of securities. (iv) Cash
conversion represents adjusted EBITDA less capex, divided by
adjusted EBITDA. (v) Operating cash flow represents adjusted EBITDA
less capex, plus changes in operating working capital requirement
including changes in payables to fixed asset suppliers. (vi)
Defined as the Operating Cash Flow - Other operating impact -
Interest paid & other financing costs - Cash Tax. (vii)
Strategic investments represent the acquisitions of strategic
assets that significantly enhance the Group's capacity or its scope
(for example, the acquisition of plants or similar facilities,
greenfield or brownfield investments), including the building of
additional new furnaces. Since 2021, they also include the
investments related to the implementation of the plan to reduce CO2
emissions. (viii) Recurring investments represent acquisitions of
property, plant and equipment and intangible assets necessary to
maintain the value of an asset and/or adapt to market demands and
to environmental, health and safety requirements. It mainly
includes furnace renovation and maintenance of IS machines.
Change in revenue by type in € million
during 2021
In € million
Revenue 2020
2,535.9
Volumes
+67.6
Price/Mix
+103.8
Exchange rates
(33.3)
Revenue 2021
2,674.0
Change in adjusted EBITDA by type in €
million during 2021
In € million
2020 Adjusted EBITDA (i)
625.7
Activity contribution
+29.2
Spread price mix/costs
+4.1
Net productivity
+40.4
Exchange rates
(11.2)
Other
(10.1)
2021 Adjusted EBITDA (i)
678.1
(i) Adjusted EBITDA is calculated on the basis of operating
profit adjusted for depreciation, amortisation and impairment,
restructuring costs, acquisition and M&A costs,
hyperinflationary effects, management share ownership plans,
subsidiary disposal‐related effects and contingencies, plant
closure costs and other items.
Key figures for the fourth
quarter
In € million
Q4 2021
Q4 2020
Revenue
651.8
580.1
Reported growth
+12.4%
Organic growth
+10.2%
Adjusted EBITDA
150.5
151.3
Adjusted EBITDA margin
23.1%
26.1%
Reconciliation of operating profit to
adjusted EBITDA
In € million
2021
2020
Operating profit
393.1
316.4
Depreciation, amortisation and impairment
(i)
281.1
276.4
Restructuring costs (ii)
(2.7)
19.8
Acquisition costs and M&A
0.0
0.1
IAS 29 Hyperinflation (Argentina)
(iii)
(4.8)
2.9
Management share ownership plan and
associated costs
10.1
5.8
Other
1.3
4.3
Adjusted EBITDA
678.1
625.7
(i) Includes depreciation and amortisation of intangible assets
and property, plant and equipment, amortisation of intangible
assets acquired through business combinations and impairment of
property, plant and equipment, including those linked to the
transformation plan implemented in France in 2020.
(ii) Corresponds mainly to the transformation plan in
France.
(iii) The Group has applied IAS 29 (Hyperinflation) since
2018.
Reconciliation of Cash conversion to
adjusted EBITDA
In € million
2021
2020
Adjusted EBITDA
678.1
625.7
Capex
(256.3)
(250.5)
Cash flows (adjusted EBITDA –
Capex)
421.8
375.2
Cash conversion
62.2%
60.0%
Adjusted EBITDA and Cash conversion are alternative performance
indicators within the meaning of AMF position no. 2015-12.
Adjusted EBITDA and cash conversion are not standardised
accounting measures that meet a single, generally accepted
definition as per IFRS. They must not be considered as a substitute
for operating income and cash flow from operating activities which
are measures defined by IFRS, or as a measure of liquidity. Other
issuers may calculate adjusted EBITDA and Cash conversion
differently from the definition used by the Group.
IAS 29: Hyperinflation in
Argentina
Since 2018, the Group has applied IAS 29 in Argentina. The
adoption of this standard requires the restatement of non‐monetary
assets and liabilities and of the income statement to reflect
changes in purchasing power in the local currency. These
restatements may lead to a gain or loss on the net monetary
position included in the finance costs.
Financial items for the Argentinian subsidiary are converted
into euro using the closing exchange rate for the relevant
period.
In 2021, the net impact on revenue was +€14 million. The
hyperinflation impact has been excluded from Group adjusted EBITDA
as shown in the table "Reconciliation of operating profit to
adjusted EBITDA".
Financial structure
In € million
Nominal amount or max. amount
drawable
Nominal rate
Final maturity
31 Dec. 2021
Sustainability-Linked Bond – May 2021
(i)
500.0
May 2028
1.625%
502.2
Sustainability-Linked Bond – November 2021
(i)
500.0
Nov. 2031
1.875%
492.9
Term Loan A - TLA (i)
500.0
October 2024
Euribor+1.25%
497.4
Revolving Credit Facility RCF1
500.0
October 2024
Euribor+0.85%
-
Neu CP (i)
400.0
150.2
Other debt (ii)
120.4
Total borrowings
1,763.0
Cash
(494.6)
Net Debt
1,268.4
(i) Including accrued interest. (ii) o/w IFRS16 leasing
(€47.3m), local debts (€57.5m), factoring recourse (€17.7m).
Consolidated income
statement
In € million
2021
2020
Revenue
2,674.0
2,535.9
Cost of sales
(2,042.4)
(1,968.2)
Selling, general and administrative
expenses
(173.9)
(160.8)
Acquisition-related items
(59.7)
(60.4)
Other operating revenue and expenses
(4.9)
(30.1)
Operating profit
393.1
316.4
Finance costs – net
(56.8)
(45.8)
Profit (loss) before tax
336.3
270.6
Income tax
(89.4)
(62.4)
Share of net profit (loss) of
associates
2.4
1.4
Net income (i)
249.3
209.6
Attributable to shareholders of the
Company
242.6
202.1
Attributable to non-controlling
interests
6.7
7.5
Basic earnings per share (in €)
2.01
1.67
Diluted earnings per share (in
€)
2.01
1.67
(i) Net income for 2021 includes an amortisation expense for
customer relationships recognised upon the acquisition of
Saint-Gobain's packaging business in 2015, of €43 million and €0.36
per share (net of taxes). By not taking this expense into account,
net income would be €292 million and €2.37 per share. This expense
was €43 million and €0.37 per share in 2020.
Consolidated balance
sheet
In € million
31 Dec. 2021
31 Dec. 2020
ASSETS
Goodwill
530.2
529.7
Other intangible assets
372.2
430.9
Property, plant and equipment
1,351.1
1,288.5
Investments in associates
5.1
2.0
Deferred tax
64.7
27.1
Other non-current assets
152.1
30.8
Non-current assets
2,475.4
2,309.0
Current portion of non-current assets and
financial assets
1.3
-
Inventories
404.3
386.9
Trade receivables and other current
assets
440.1
158.7
Current tax receivables
1.2
5.0
Cash and cash equivalents
494.6
476.2
Current assets
1,341.5
1,026.8
Total Assets
3,816.9
3,335.8
LIABILITIES
Share capital
413.3
416.7
Consolidated reserves
333.1
121.6
Equity attributable to
shareholders
746.4
538.3
Non-controlling interests
53.3
39.5
Equity
799.7
577.8
Non-current financial liabilities and
derivatives
1,569.0
1,569.1
Provisions for pensions and other employee
benefits
117.5
134.0
Deferred tax
263.8
146.0
Provisions and other non-current financial
liabilities
21.3
24.1
Non-current liabilities
1,971.6
1,873.2
Current financial liabilities and
derivatives
197.2
185.7
Current portion of provisions and other
non-current financial liabilities
39.5
59.8
Trade payables
521.4
367.5
Current tax liabilities
23.6
21.8
Other current liabilities
263.9
250.0
Current liabilities
1,045.6
884.8
Total Equity and Liabilities
3,816.9
3,335.8
Consolidated cash flow
statement
In € million
2021
2020
Net income
249.3
209.6
Depreciation, amortisation and impairment
of assets
281.1
276.4
Interest expense on financial
liabilities
32.0
35.4
Change in inventories
(16.9)
55.3
Change in trade receivables, trade
payables & other receivables & payables
107.2
15.8
Current tax expense
107.9
73.0
Taxes paid
(91.4)
(60.2)
Changes in deferred taxes and
provisions
(46.8)
(4.5)
Other
19.1
8.8
Net cash flows from operating
activities
641.5
609.6
Acquisition of property, plant and
equipment and intangible assets
(256.3)
(250.5)
Increase (decrease) in debt on fixed
assets
(10.7)
2.8
Other
(4.5)
1.3
Net cash flows from (used in) investing
activities
(271.5)
(246.4)
Capital increase (reduction)
15.7
20.1
Dividends paid
(114.2)
(13.1)
Increase (decrease) in treasury stock
(221.1)
-
Transactions with shareholders
(319.6)
7.0
Transactions with non-controlling
interests
(1.5)
(2.2)
Increase (reduction) in bank overdrafts
and other short-term borrowings
2.9
(40.9)
Increase in long-term debt
1,039.1
207.0
Reduction in long-term debt
(1,041.0)
(228.5)
Financial interest paid
(31.4)
(31.6)
Change in gross debt
(30.4)
(94.0)
Net cash flows from (used in) financing
activities
(351.5)
(89.2)
Increase (reduction) in cash and cash
equivalents
18.5
274.0
Impact of changes in foreign exchange
rates on cash and cash equivalents
0.0
(17.1)
Opening cash and cash
equivalents
476.2
219.2
Closing cash and cash
equivalents
494.6
476.2
GLOSSARY
Activity category: corresponds to
the sum of the change in volumes plus or minus the net change in
inventories.
Organic growth: corresponds to
revenue growth at constant exchange rates and scope. Revenue growth
at constant exchange rates is calculated by applying the average
exchange rates of the comparative period to revenue for the current
period of each Group entity, expressed in its reporting
currency.
Adjusted EBITDA: This is a non-IFRS
financial measure. It is an indicator for monitoring the underlying
performance of businesses adjusted for certain expenses and/or
income which are non-recurring or liable to distort the company's
performance. Adjusted EBITDA is calculated on the basis of
operating profit adjusted for depreciation, amortisation and
impairment, restructuring costs, acquisition and M&A costs,
hyperinflationary effects, management share ownership plans,
subsidiary disposal-related effects and contingencies, plant
closure costs and other items.
Capex: Short for "capital
expenditure", this represents purchases of property, plant and
equipment and intangible assets necessary to maintain the value of
an asset and/or adapt to market demand or to environmental and
health and safety constraints, or to increase the Group's capacity.
It excludes the purchase of securities.
Recurring investments: Recurring
Capex represent acquisitions of property, plant and equipment and
intangible assets necessary to maintain the value of an asset
and/or adapt to market demand and to environmental, health and
safety constraints. It mainly includes furnace renovation and
maintenance of IS machines.
Strategic investments: Strategic
investments represent the acquisitions of strategic assets that
significantly enhance the Group's capacity or its scope (for
example, the acquisition of plants or similar facilities,
greenfield or brownfield investments), including the building of
additional new furnaces. Since 2021, they also include the
investments related to the implementation of the plan to reduce CO2
emissions.
Cash conversion: refers to the
ratio between cash flow and adjusted EBITDA. Cash flow refers to
adjusted EBITDA less Capex.
Free Cash-Flow: defined as the
Operating Cash Flow - Other operating impact - Interest paid &
other financing costs - Cash Tax.
The Southern and Western Europe
segment comprises production plants located in France, Spain,
Portugal and Italy. It is also designated by the abbreviation
"SWE".
The Northern and Eastern Europe
segment comprises production plants located in Germany, Russia,
Ukraine and Poland. It is also designated by the abbreviation
"NEE".
The Latin America segment comprises
production plants located in Brazil, Argentina and Chile.
Liquidity: calculated as the Cash +
Undrawn Revolving Credit Facilities – Outstanding Neu Commercial
Paper.
Amortisation of intangible assets acquired
through business combinations: Corresponds to the
amortisation of customer relations recognised upon the acquisition
of Saint-Gobain's packaging business in 2015 (initial gross value
of €740 million over a useful life of 12 years).
1 Spread represents the difference between (i) the increase in
sales prices and mix applied by the Group after passing the
increase in its production costs on to these prices, if required,
and (ii) the increase in its production costs. The spread is
positive when the increase in sales prices applied by the Group is
greater than the increase in its production costs. The increase in
production costs is recorded by the Group at constant production
volumes and before production gap and the impact of the Performance
Action Plan (PAP). 2 Operating cash flow represents adjusted EBITDA
less capex, plus changes in operating working capital requirement
including changes in payables to fixed asset suppliers. 3 Cash flow
from operating activities – Other operating impact – Financial
interest paid and other financing costs – Taxes paid. 4 Calculated
as the Cash + Undrawn Revolving Credit Facilities – Outstanding
Commercial Paper. 5 Target to be validated by the SBT initiative. 6
Recycled glass. 7 Target to be validated by the SBT initiative. 8
At constant FX and excluding changes in perimeter. 9 Defined as the
Operating Cash Flow - Other operating impact - Interest paid &
other financing costs - Cash Tax. 10 Earnings excl. amortization
expense for customer relations (PPA) recognized upon the
acquisition from Saint-Gobain, of ca €0.38 / share (net of
taxes).
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220216005943/en/
Verallia Investor Relations
contact Alexandra Baubigeat Boucheron –
alexandra.baubigeat-boucheron@verallia.com
Press contacts Julie
Bastien - julie.bastien@verallia.com Brunswick - Benoit
Grange, Hugues Boëton, Tristan Roquet Montegon -
verallia@brunswickgroup.com - +33 1 53 96 83 83
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