Antalis : Results for the first half of 202023/09/2020 - PDF - 219.24 Ko

Press Release

Boulogne-Billancourt, 23 September 2020

Results for the first half of 2020

Decline in operational performance in the context of the Covid-19 pandemic

• Net sales of €817 million, down -23.3% on a like-for-like basis (-23.8% on a reported basis)
• Gross profit of €202 million, down -22.3% on a like-for-like basis (-22.6% on a reported basis); gross margin held up 0.3 points to 24.7%
• Contribution of Packaging and Visual Communication to total gross margin up +5 points to 44%
• EBITDA of €7 million, down -76.2% on a like-for-like basis (down -75.6% on a reported basis); EBITDA margin of 0.9% (-1.9 points)
• Net financial debt stable at €317 million

Financial data after application of IFRS 16

• EBITDA at €28 million
• Net loss of -€90 million, including €64 million of net non-recurring expenses
• Net financial debt at €425 million

Hervé Poncin, Chief Executive Officer of Antalis said: "In the first half of 2020, our group's operating performance was severely affected by the global economic crisis caused by the Covid-19pandemic in a European paper market that declined in volume by around -22%.As a result, group sales were down -23%on a like-for-likebasis with good resilience in all business sectors, with a gross margin rate at 24.7%. The Packaging business was proportionally more resilient and, together with Visual Communication, made a 44% contribution to Antalis' total gross margin. Against this backdrop, we significantly reduced our fixed and variable costs, in particular as part of government measures implemented to support businesses in all countries where this was possible. As a result, the EBITDA margin stood at 0.9%. All countries were able to continue to operate in compliance with the required health and safety measures thanks to the commitment of our employees."

Consolidated income statement

On 22 September 2020, Antalis' Board of Directors approved the financial statements for the first half of 2020.

		H1 2020		H1 2019		as reported		on a comparable			H1 2020		H1 2019
		before IFRS 16		before IFRS 16				basis(1)			after IFRS 16		after IFRS 16
(in € millions)
Sales		817.1		1,072.2			-23.8%			-23.3%			817.1		1,072.2
Gross margin		202.2		261.3			-22.6%			-22.3%			202.2		261.3
Gross margin rate (as % of sales)		24.7%		24.4%			+0.3 points			-			24.7%		24.3%
EBITDA		7.4		30.1			-75.6%			-76.2%			27.8		51.0
EBITDA margin (as % in sales)		0.9%		2.8%			-1.9 points						3.4%		4.8%
Current operating income		(4.1)		19.4			N/A			N/A			(1.4)		20.9
Current operating margin (as % of		-0.5%		1.8%			-2.3 points						-0.2%		1.9%
sales)
							Net income (loss) attributable to		(90.3)		(27.4)
							owners
							Diluted earnings (loss) per share	(1.28)		(0.39)
									(€)
							Average number of shares (after	70,497,095		70,511,313
							dilution)

1. Changes in comparable figures are restated without calendar FX and perimeter impacts.

The table below details the impact of the application of IFRS 16 on the main indicators in the financial statements for the first half of 2020:

				Depreciation of	Lease liabilities
(in € millions)	H1 2020 before		Cancellation of	right-of-use	and finance
IFRS 16		lease payments	assets	costs
Sales	817.1
Gross margin	202.2
Gross margin rate (% of sales)	24.7%
EBITDA	7.4		20.4	-	-
Margin in %	0.9%
Current operating income	(4.1)		20.4	(17.7)	-
Margin in %	-0.5%
Net income - group share	(89.0)		20.4	(17.7)	(4.0)
Net financial debt	316.5				108.7

H1 2020 after

IFRS 16 817.1

202.2

24.7%

27.8

3.4%

(1.4)

-0.2%

(90.3)

425.2

Antalis delivered sales of €817 million, down -23.3% on a like-for-like basis compared with the first half of 2019 (-23.8% on a reported basis). This decline mainly reflects lower volumes in Papers, exacerbated by the Covid-19 crisis, but also in Visual Communication and, to a lesser extent, in Packaging as a result of the pandemic. The change in sales attributable to foreign exchange was negligible over the period.

The group's gross margin amounted to €202 million, down -22.3% on a like-for-like basis (-22.6% on a reported basis). The gross margin rate was 24.7% as reported (+0.3 points). The contribution of Packaging and Visual Communication to Antalis' total gross margin continued to grow to reach 44%, rising by +5 points compared to 30 June 2019.

EBITDA amounted to €7 million, down -76.2% on a like-for-like basis (-75.6% on a reported basis) due to the sharp decline in activity. Antalis benefited from a significant reduction in both variable and fixed costs, notably as a result of government measures implemented to support businesses in many countries. The EBITDA margin came to 0.9% on a reported basis (-1.9 points).

Loss from recurring operations is at -€4 million compared to €19 million in the first half of 2019.

Antalis recorded net non-recurring charges of €64 million, including, in particular, an amount of €39 million in net asset impairment losses and, for most of the remainder, restructuring costs recorded in the first half of the year.

In view of the indications of impairment attributable to the sharp drop in the activity due to the global health crisis, the group has implemented a test of the book value of most of its assets at 30 June 2020. In the current exceptional context of uncertainty, the value in use of these assets was determined on the basis of the business plan used for the impairment tests carried out at the end of 2019, adjusted for observable effects on the business for the 2020 financial year and assumptions for a more or less gradual recovery depending on the geographical areas and markets in which Antalis operates. The main impairment loss then identified concerned the €25 million goodwill allocated to the group's activities in the United Kingdom, which was fully impaired in the first-half financial statements.

After taking into account the net impact of IFRS 16 (-€1 million), other financial expenses and tax, net profit was a loss of -€90 million (-€27 million during the first half of 2019).

Net financial debt excluding lease debt amounted to €317 million (€318 million at 30 June 2019).

As of the date of this press release, the limited review diligences have been carried out and the corresponding statutory auditors' report is in the process of being issued.

Key figures by geography

(in € millions)	H1 2020	H1 2019	as reported
Sales
Major European Geographies	415.0	552.6	-24.9%
- United Kingdom and Ireland	199.4	282.0	-29.3%
-	Germany and Austria	126.0	145.2	-13.2%
-	France	89.6	125.4	-28.5%
Rest of Europe	355.0	446.6	-20.5%
Rest of the World	47.0	73.0	-35.6%
Total	817.1	1072.2	-23.8%
EBITDA(1)
Major European Geographies	2.0	16.5	-87.9%
-	EBITDA margin	0.5%	3.0%	-2.5 points
Rest of Europe	7.3	11.6	-37.1%
-	EBITDA margin	2.1%	2.6%	-0.5 points
Rest of the World	(2.0)	2.0
-	EBITDA margin	-4.3%	2.7%	-7.0 points
Total	7.4	30.1	-75.6%

1. The EBITDA referred to in this press release does not take into account, unless otherwise indicated, the changes in methods introduced in 2019 by IFRS 16 on leases.

• Main European Geographies

The Main European Geographies generated sales of €415 million, down -24.9%.

Activity in the United Kingdom and Ireland declined with sales of €199 million, down -29.3% due to the Covid-19 pandemic and uncertainties related to Brexit accentuating economic difficulties. Sales in Germany and Austria amounted to €126 million, down -13.2%, this region having been proportionally less affected than other European countries by the Covid-19 crisis and benefiting from the positive effects of market consolidation in Germany. France, for its part, achieved a turnover of €90 million, down -28.5%, mainly reflecting the impact of the Covid-19 pandemic.

EBITDA for the Main European Geographies amounted to €2 million, down -87.9%. The EBITDA margin was 0.5% (-2.5 points).

• Rest of Europe

Net sales in the Rest of Europe zone amounted to €355 million, down -20.5%. Antalis suffered from the Covid-19 pandemic mainly in Southern Europe and to a lesser extent in Eastern and Northern Europe.

The Rest of Europe reported EBITDA of €7.3 million, down -37.1%. EBITDA margin was 2.1% (-0.5 points).

• Rest of the World

Net sales in the Rest of the World zone came to €47 million, down -35.6% mainly due to the strong spread of Covid-19, which began in January/February 2020 in Asia and a few weeks later in Latin America.

EBITDA for the Rest of the World amounted to -€2.0 million. The EBITDA margin represents -4.3% of sales.

Key figures by business sector

				Sales							Gross margin		Gross margin/Sales
(in € millions)		H1 2020		H1 2019	as reported	H1 2020		H1 2019		as reported			H1 2020		H1 2019		as reported
Papers		504.6		714.1		-29.3%			112.5		159.6		-29.5%			22.3%		22.3%		0.0 points
Packaging		229.2		254.2		-9.8%			65.6		71.7		-8.5%			28.6%		28.2%		+0.4 points
Visual Com.		83.2		103.9		-19.9%			24.1		30.0		-19.7%			29.0%		28.9%		+0.1 points
Total		817.1		1,072.2		-23.8%			202.2		261.3		-22.6%			24.7%		24.4%		0.3 points

• Papers

During the first half of 2020, the economic uncertainties strongly linked to the Covid-19 pandemic weighed on paper consumption, with a drop in production volumes of around -23% in Europe, adding downward pressure on sales prices.

The group's consolidated sales came to €505 million, down -29.3%. The gross margin amounted to €113 million, down -29.5%. The gross margin rate was 22.3%, unchanged from the first half of 2019.