PRESS RELEASE
Strong start to the year; 2024 outlook confirmed
Q1 2024 Key figures1
- Revenue of
EUR 1,439.5 million in the first quarter of 2024, up 2.5% year-on-year and up 8.0% organically - Strong organic growth from Industry +16.3%, Certification +13.7%, Marine & Offshore +13.6%, compared to the first quarter of 2023; growth of +6.1% for Consumer Products Services, +3.6% for Buildings & Infrastructure and +3.2% for Agri-food & Commodities
- The scope effect was a positive 0.1%, reflecting bolt-on acquisitions offset by a small disposal
- The currency impact was negative by 5.6% mainly due to the depreciation of some emerging countries’ currencies against the euro
Q1 2024 Highlights
- New strategy LEAP | 28, announced on
March 20, 2024 , to deliver a step change in growth and performance, built around three pillars: Focused Portfolio, Performance-led execution and Evolved People model - Strong growth in every region (
Americas ,Middle East ,Africa ,Asia-Pacific andEurope ), outperforming many underlying markets - Growth momentum maintained for sustainability services – both transition services and Green Objects - across the entire portfolio
- In line with the LEAP | 28 strategy, the Consumer Products Services business line completed the acquisition of three bolt-on companies in South and North-East Asia, expanding the Group’s portfolio into new sectors and diversifying its geographical coverage, adding an annualized revenue of c. EUR 20 million
- To execute the share buyback program announced in March at the Capital Markets Day, an acquisition of c. 0.8% of the Group’s own shares on
April 5, 2024 , was completed under the Wendel placement - Assignment of the first long-term credit rating of
Bureau Veritas with a A3 rating from Moody’s, with “stable” outlook, which reflects the Group’s strong financial structure and competitive advantage - New recognition of Bureau Veritas’ CSR commitment by several non-financial rating agencies, including a first ranking in Sustainalytics.
Bureau Veritas also joins the United Nations Global Compact.
2024 Outlook confirmed
Leveraging a healthy and growing sales pipeline, high customer demand for ‘new economy services’ and strong underlying market growth,
- Mid-to-high single-digit organic revenue growth;
- Improvement in adjusted operating margin at constant exchange rates;
- Strong cash flow, with a cash conversion2 above 90%.
The Group expects H2 organic revenue growth above H1 given stronger comparables in Q2.
“In the first quarter of the year, we launched our LEAP I 28 strategy both internally and to our investors. Our commitment to sustainable organic growth, active portfolio management through M&A and yearly margin improvement is in line with our ambition to deliver double-digit shareholder returns.
We have started our strategy execution and
In addition, I am pleased to announce the first long-term credit rating of
Looking ahead, we confirm our outlook for 2024.”
Q1 2024 KEY REVENUE FIGURES
GROWTH | ||||||||
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |||
Marine & Offshore | 122.1 | 113.1 | +8.0% | +13.6% | - | (5.6)% | ||
297.3 | 302.7 | (1.8)% | +3.2% | - | (5.0)% | |||
Industry | 295.6 | 295.3 | +0.1% | +16.3% | (2.5)% | (13.7)% | ||
Buildings & Infrastructure | 441.0 | 431.6 | +2.2% | +3.6% | - | (1.4)% | ||
Certification | 117.4 | 106.9 | +9.8% | +13.7% | - | (3.9)% | ||
Consumer Products | 166.1 | 154.9 | +7.2% | +6.1% | +5.4% | (4.3)% | ||
1,439.5 | 1,404.5 | +2.5% | +8.0% | +0.1% | (5.6)% |
Revenue in the first quarter of 2024 amounted to
This is reflected as follows by business:
- More than a third of the portfolio delivered double-digit organic revenue growth in the quarter, benefiting from increasing decarbonization trends and energy transition for Marine & Offshore, and Industry. The rising demand for Sustainability and ESG-driven services are seen in the growth momentum of Certification.
- An eighth of the portfolio delivered mid-to-high single-digit organic revenue growth (up 6.1%). The growth in the Consumer Products Services activities was led by most geographies. The business benefited from the organic growth coming from recent acquisitions as the Group executes its strategy of geography, sector, and services diversification in this market.
- Half of the portfolio including Buildings & Infrastructure and
Agri-Food & Commodities achieved low single-digit organic revenue growth (up 3.6% and 3.2% respectively). The growth was driven by solid underlying trends.
By geography, activities in the
The scope effect was a positive 0.1%, reflecting bolt-on acquisitions realized in the past few quarters offset by the impact of a small disposal which was made in the third quarter of 2023.
Currency fluctuations had a negative impact of 5.6%, mainly due to the depreciation of some emerging countries’ currencies against the euro (in
SOLID FINANCIAL POSITION
At the end of
2024 SHARE BUYBACK PROGRAM
To execute the
In accordance with the purpose of the share buyback program approved by the Annual General Meeting, the shares bought back will be used for cancellation purposes and for any other purposes authorized by the Company’s shareholders at the Annual General Meeting of
A3 FIRST LONG-TERM CREDIT RATING BY MOODY’S
According to Moody’s, the A3 rating is primarily supported by the Group:
- Leading market position, protected by high barriers to entry, and by its well diversified business model;
- Long track record of positive organic growth through the cycle;
- Supportive long-term fundamentals of the TIC (Testing, Inspection and Certification) market;
- Conservative financial policies underpinned by large cash reserves and balanced capital allocation between Capex spending, acquisitions and shareholder distributions;
- Track record of solid free cash flow (FCF) generation and strong liquidity.
This long-term credit rating will help
FOCUSED PORTFOLIO
In line with the LEAP | 28 strategy of active portfolio management and in order to focus the portfolio on market leadership positions,
ANNUALIZED REVENUE | COUNTRY/ AREA | SIGNING DATE | FIELD OF EXPERTISE | ||
Consumer Products Services | |||||
Testing and certification services for Electrical and Electronics consumer products | |||||
Testing and certification services for Electrical and Electronics consumer products | |||||
Hi Physix Laboratory India Pvt. | Electrical and electronics products testing and certification services laboratory |
For more information, the press release is available by clicking here.
CORPORATE SOCIAL RESPONSIBILITY COMMITMENTS
Bureau Veritas joins the United Nations Global Compact
On
- Strong recognition by non-financial rating agencies
On
- Corporate Social Responsibility (CSR) key indicators
UNITED NATIONS’ SDGS | Q1 2024 | Q1 2023 | 2028 TARGET | |
ENVIRONMENT / NATURAL CAPITAL | ||||
CO2 emissions (scope 1 & 2, 1,000 tons)3 | #13 | 150 | 146 | 107 |
SOCIAL & HUMAN CAPITAL | ||||
Total Accident Rate (TAR)4 | #3 | 0.28 | 0.27 | 0.23 |
Gender balance in senior leadership (EC-II)5 | #5 | 28% | 30% | 36% |
Number of learning hours per employee (per year)6 | #8 | 2.8 | 4.2 | 40.0 |
GOVERNANCE | ||||
Proportion of employees trained to the Code of Ethics | #16 | 98.5% | 96.6% | 99.0% |
OPERATIONAL APPOINTMENTS
Khurram Majeed appointed Executive Vice- President, Commodities, Industry and Facilities,Middle East ,Caspian andAfrica
On
For more information, the press release is available by clicking here.
2024 OUTLOOK CONFIRMED
Leveraging a healthy and growing sales pipeline, high customer demand for ‘new economy services’ and strong underlying market growth,
- Mid-to-high single-digit organic revenue growth;
- Improvement in adjusted operating margin at constant exchange rates;
- Strong cash flow, with a cash conversion7 above 90%.
The Group expects H2 organic revenue growth above H1 given stronger comparables in Q2.
LEAP | 28 STRATEGY
On
2024-2028 | |
GROWTH CAGR | High-single digit total revenue growth8 |
With: | Organic: mid-to-high single digit |
And: | M&A acceleration and portfolio high-grading |
MARGIN | Consistent adjusted operating margin improvement8 |
EPS CAGR8 + DIVIDEND YIELD | Double digit returns |
CASH | Strong cash conversion9: above 90% |
Over the period 2024-2028, the use of Free Cash Flow generated from the Group’s operations will be balanced between Capital Expenditure (Capex), Mergers & Acquisitions (M&A) and shareholder returns (dividend):
ASSUMPTIONS | |
CAPEX | Around 2.5-3.0% of Group revenue |
M&A | M&A acceleration |
DIVIDEND | Pay-out of 65% of Adjusted Net Profit |
LEVERAGE | Between 1.0x-2.0x by 2028 |
Q1 2024 BUSINESS REVIEW
MARINE & OFFSHORE
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 122.1 | 113.1 | +8.0% | +13.6% | - | (5.6)% |
The Marine & Offshore business delivered a strong 13.6% organic revenue increase in the first quarter of 2024 with the following trends:
- A solid double-digit increase in
New Construction (40% of divisional revenue), supported by a strong orderbook made of various types and sizes of vessels; - Core In-service activity (47% of divisional revenue) posted a double-digit growth, benefiting from a combination of price increases and volume growth due to the increase in the number of classed vessels and from the ageing of the fleet. At March end, the fleet classed by
Bureau Veritas comprised of 11,823 ships, representing 150.8 million of Gross Register Tonnage (GRT); - Services (13% of divisional revenue, including Offshore) recorded a mid-single-digit growth, and were driven by good commercial development of non-class services, including consulting services around ship energy efficiency.
New orders totaled 2.8 million gross tons at the end of
Sustainability achievements
During this first quarter of 2024,
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 297.3 | 302.7 | (1.8)% | +3.2% | - | (5.0)% |
The
The Oil & Petrochemicals segment (O&P, 32% of divisional revenue) recorded once again a mid-single-digit organic growth, despite the competitive nature of this business in some geographies such as
The Metals & Minerals segment (M&M, 31% of divisional revenue) achieved a stable performance in the first quarter. The Upstream business (which represents two-third of M&M) faced unfavorable comparables as customers remained cautious on investments in view of the current macro conditions. The activity however benefited from a very good momentum for precious metals such as gold and from the Group’s on-site laboratories strategy, with a new win in
In Q1 2024,
Government services (14% of the divisional revenue) delivered a slightly negative organic growth in the quarter due mainly to unfavorable comparables and temporary volume reductions from the ending of some contracts. These were partly offset by the good performance of Single Window contracts in some African countries. The pipeline of new opportunities remains solid.
Sustainability achievements
In the first quarter of 2024,
INDUSTRY
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 295.6 | 295.3 | +0.1% | +16.3% | (2.5)% | (13.7)% |
Industry continued to perform well in the first quarter of 2024 with an organic growth of 16.3%, with growth in most markets and geographies.
By market, Power & Utilities (12% of divisional revenue) growth was moderated by unfavorable comparables. Business declined in
In Oil & Gas (33% of divisional revenue), the activity remained buoyant, up double-digit organically in the quarter. Both Capex and Opex services strongly increased across most geographies as they continue to benefit from the conversion of a solid sales pipeline and a healthy backlog. The activity was particularly dynamic in the US,
Industry Products Certification (17% of divisional revenue) delivered high-single-digit organic revenue growth led by price increases and growing activity for Pressure & Welding, and Electromechanical & Advanced Technologies sub-segments. Growth was strong in the
Elsewhere, the Environmental Testing business (9% of divisional revenue) performed well, with the remediation works in
Sustainability achievements
In the first quarter of 2024, the Group was awarded a contract to deliver integrated QA/QC services for the construction of a 493 MW El Dorado Solar facility with TriGlobal Energy in the US. The Group was also selected for the renewables equipment supervision for a Chinese energy company.
BUILDINGS & INFRASTRUCTURE
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 441.0 | 431.6 | +2.2% | +3.6% | - | (1.4)% |
The Buildings & Infrastructure (B&I) business delivered an organic revenue growth of 3.6% in the first quarter, fueled by
During the period, the building-in service activity outperformed the construction-related activities.
The
Growth in
The
Lastly, in the
Sustainability achievements
The Group continues to provide decarbonization solutions as asset owners transition towards a building sector aligned with long term goals of the Paris Agreement in 2015. In the first quarter, in
CERTIFICATION
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 117.4 | 106.9 | +9.8% | +13.7% | - | (3.9)% |
Once again, the Certification business posted a strong performance over the first quarter of 2024, recording a 13.7% growth on an organic basis. This was achieved through good volumes growth, owing to favorable market conditions, and robust price increases. All geographies grew organically, with the
QHSE & Specialized Schemes solutions (48% of the divisional revenue) grew high-single digit, thanks to the recertification cycle occurring this year for some standards. It supported the robust performance in QHSE solutions, especially in
Sustainability-related solutions & Digital (Cyber) certification activities (31% of divisional revenue) also grew double-digit on an organic basis, benefiting from the excellent traction around environmental and carbon services, food sustainability and increasing demand for cybersecurity assurance. In
Other solutions, including Training (21% of the divisional revenue) recorded a low-single-digit revenue contraction in Q1 2024, despite the excellent performance of its Spanish operations.
Sustainability achievements
In the first quarter of 2024,
In the US, the Group also delivered FSC (
CONSUMER PRODUCTS SERVICES
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Revenue | 166.1 | 154.9 | +7.2% | +6.1% | +5.4% | (4.3)% |
The Consumer Products Services division posted a 6.1% organic revenue performance over the first quarter of 2024, with varying geographical and service trends boosted by early seasons shipments.
Softlines, Hardlines & Toys (46% of divisional revenue) saw high-single digit organic growth in the first quarter of 2024, due to the end of destocking and early shipments, in response to logistics delays from the
Healthcare (including Beauty and Household) (9% of divisional revenue) delivered solid double-digit organic growth in Q1. This performance is driven by global accounts, especially for
Supply Chain & Sustainability services (14% of divisional revenue) recorded a very good double-digit performance accreditable to the restart of test activities and to the shipment growth.
Technology (31% of divisional revenue) saw a mid-single-digit contraction on the first quarter of 2024, affected by a global decrease in demand for electrical and mobility equipment.
The Group pursued its geographical diversification strategy to build resilience and unlock growth for the consumer Tech sub-segment in the first quarter of 2024. Realizing three acquisitions (
Sustainability achievements
During the first quarter of 2024,
PRESENTATION
- Q1 2024 revenue will be presented on
Thursday, April 25, 2024 , at6:00 p.m. (Paris time) - A video conference will be webcast live. Please connect to: Link to video conference
- The presentation slides will be available on: https://group.bureauveritas.com/investors/financial-information/financial-results
- All supporting documents will be available on the website
- Live dial-in numbers:
France : +33 (0)1 70 37 71 66UK : +44 (0) 33 0551 0200- US: +1 786 697 3501
- International: +44 (0) 33 0551 0200
- Password:
Bureau Veritas
2024 FINANCIAL CALENDAR
- Shareholder’s Meeting:
June 20, 2024 - H1 2024 Results:
July 26, 2024 (pre-market) - Q3 2024 Revenue:
October 23, 2024 (post market)
ABOUT
Created in 1828, Bureau Veritas’ 83,000 employees deliver services in 140 countries. The company’s technical experts support customers to address challenges in quality, health and safety, environmental protection, and sustainability.
For more information, visit www.bureauveritas.com, and follow us on LinkedIn and X/Twitter.
Our information is certified with blockchain technology. Check that this press release is genuine at www.wiztrust.com. | ||||||
ANALYST/INVESTOR CONTACTS | MEDIA CONTACTS | |||||
+33 (0)1 55 24 76 09 | + 33 (0)6 69 79 84 88 | |||||
laurent.brunelle@bureauveritas.com | anette.rey@bureauveritas.com | |||||
+33 (0)1 55 24 77 80 | ||||||
colin.verbrugghe@bureauveritas.com | ||||||
+33 (0)1 55 24 76 19 karine.ansart@bureauveritas.com |
This press release (including the appendices) contains forward-looking statements, which are based on current plans and forecasts of Bureau Veritas’ management. Such forward-looking statements are by their nature subject to a number of important risk and uncertainty factors such as those described in the Universal Registration Document (“Document d’enregistrement universel”) filed by
APPENDIX 1: Q1 2024 REVENUE BY BUSINESS
IN | Q1 2024 | Q1 2023 | CHANGE | ORGANIC | CURRENCY | |
Marine & Offshore | 122.1 | 113.1 | +8.0% | +13.6% | - | (5.6)% |
297.3 | 302.7 | (1.8)% | +3.2% | - | (5.0)% | |
Industry | 295.6 | 295.3 | +0.1% | +16.3% | (2.5)% | (13.7)% |
Buildings & Infrastructure | 441.0 | 431.6 | +2.2% | +3.6% | - | (1.4)% |
Certification | 117.4 | 106.9 | +9.8% | +13.7% | - | (3.9)% |
Consumer Products | 166.1 | 154.9 | +7.2% | +6.1% | +5.4% | (4.3)% |
1,439.5 | 1,404.5 | +2.5% | +8.0% | +0.1% | (5.6)% |
APPENDIX 2: DEFINITION OF ALTERNATIVE PERFORMANCE INDICATORS AND RECONCILIATION WITH IFRS
The management process used by
GROWTH
Total revenue growth
The total revenue growth percentage measures changes in consolidated revenue between the previous year and the current year. Total revenue growth has three components:
- organic growth;
- impact of changes in the scope of consolidation (scope effect);
- impact of changes in exchange rates (currency effect).
Organic growth
The Group internally monitors and publishes “organic” revenue growth, which it considers to be more representative of the Group’s operating performance in each of its business sectors.
The main measure used to manage and track consolidated revenue growth is like-for-like, or organic growth. Determining organic growth enables the Group to monitor trends in its business excluding the impact of currency fluctuations, which are outside of Bureau Veritas’ control, as well as scope effects, which concern new businesses or businesses that no longer form part of the business portfolio. Organic growth is used to monitor the Group’s performance internally.
The Group also considers that separately presenting organic revenue generated by its businesses provides management and investors with useful information on trends in its industrial businesses, and enables a more direct comparison with other companies in its industry.
Organic revenue growth represents the percentage of revenue growth, presented at Group level and for each business, based on constant scope of consolidation and exchange rates over comparable periods:
- constant scope of consolidation: data are restated for the impact of changes in the scope of consolidation over a 12-month period;
- constant exchange rates: data for the current year are restated using exchange rates for the previous year.
Scope effect
To establish a meaningful comparison between reporting periods, the impact of changes in the scope of consolidation is determined:
- for acquisitions carried out in the current year: by deducting from revenue for the current year revenue generated by the acquired businesses in the current year;
- for acquisitions carried out in the previous year: by deducting from revenue for the current year revenue generated by the acquired businesses in the months in the previous year in which they were not consolidated;
- for disposals and divestments carried out in the current year: by deducting from revenue for the previous year revenue generated by the disposed and divested businesses in the previous year in the months of the current year in which they were not part of the Group;
- for disposals and divestments carried out in the previous year: by deducting from revenue for the previous year revenue generated by the disposed and divested businesses in the previous year prior to their disposal/divestment.
Currency effect
The currency effect is calculated by translating revenue for the current year at the exchange rates for the previous year.
1 Alternative performance indicators are presented, defined and reconciled with IFRS in appendix 2 of this press release.
2 (Net cash generated from operating activities – lease payments + corporate tax)/adjusted operating profit.
3 Indicator calculated over 12 rolling months.
4 TAR: Total Accident Rate (number of accidents with and without lost time x 200,000/number of hours worked).
5 Proportion of women from the Executive
6 Indicator calculated over a 3-month period compared to a 12-month period for 2028 target values.
7 (Net cash generated from operating activities – lease payments + corporate tax)/adjusted operating profit
8 At constant currency.
9 (Net cash generated from operating activities – lease payments + corporate tax)/adjusted operating profit.
Attachment
- 2024 04 25_Press Release_Q1 2024 Revenue_VDef
© OMX, source