Press release
Belfort, February 16, 2012
LISI REPORTS SIGNIFICANT IMPROVEMENT IN RESULTS FOR 2011
Sales revenue increase 19.1% to €925 M
Strong organic growth: +13.8%
Dynamic performance from the Aerospace Division in Europe
Solid results for the Automotive Division
Return to profitability confirmed
EBIT: €76.6 M (+ 54.9 %)
Further improvement in operating margin: 8.3% (+1.9
points)
Financial structure still very solid after acquisitions in
2010 and 2011
Positive free cash flow: €6.4 M, after a 28% increase in
capital expenditures
Rise in average ROCE: 13.3 % (+3.3 points before corporate
tax) Further increase in the dividend: up 24% to €1.30 per
share Good general outlook, supported by numerous
projects
Belfort, February 16, 2012 - LISI's Board of Directors,
chaired by Chairman Gilles Kohler, reviewed the final
accounts for the financial year ending December 31, 2011.
They will be submitted for approval at the General Meeting on
April 26, 2012.
12 months ending December 31, 2011 2010 Change
Key elements of the income statement
Sales revenue €M 925.1 776.7 + 19.1% EBITDA €M 122.1 95.7 +
27.6% EBITDA margin % 13.2 12.3 + 0.9 pts EBIT €M 76.6 49.5 +
54.9% Current operating margin % 8.3 6.4 + 1.9 pts Earnings
attributable to holders of company equity €M 58.2 32.9 +
76.8% Net earnings per share € 5.61 3.19 + 75.9%
Key elements of the cash flow statements
Operating cash flow €M 95.3 79.5 + 19.9% Net CAPEX €M - 64.9
- 50.6 + 28.2 % Free cash flow (FCF) €M 6.4 54.8 - 88.3%
Key elements of the financial structure
Net debt €M 102.6 17.5 n.a.
Ratio of net debt to equity 18.9% 3.6% + 15.3 pts
Sales revenue increase 19.1% to €925 M
The significant increase in the LISI group's sales in
2011 can be explained as follows:
- the dynamism of the Aerospace Division in Europe and the
acquisition of the Creuzet group, consisting of Creuzet
Aéronautique and Indraero Siren, which generated €58.9 M,
from which LISI AEROSPACE benefited (€407.6 M, +44.7%),
- the solid performance of the Automotive Division (€446.3 M,
being + 11.2%),
1
- the contribution of LISI MEDICAL (€74.0 M) particularly due
to its "Orthopaedics" branch, which more than
compensated up for the disposal of LISI COSMETICS, which was
sold in April 2011 (2010 sales: €52.8 M).
At constant scope and exchange rates, organic growth was
13.8%, compared to 3.5% in 2010. It gradually slowed down
during the year, before being boosted by external growth with
the integration of the Creuzet group; this acquisition alone
accounted for approximately 12% of instantaneous growth in
the second half of the year.
LISI Consolidated | Of which LISI AEROSPACE | Of which LISI AUTOMOTIVE | Of which LISI MEDICAL | |
Q1 | +23.7% | +16.3% | +28.4% | +297.0% |
Q2 | +11.5% | +16.7% | +10.2% | +246.4% |
Q3 | +25.4% | +69.9% | +9.1% | +51.3% |
Q4 | +16.8% | +77.5% | -1.4% | -22.7% |
2011 | +19.1% | +44.7% | +11.2% | +73.3% |
The Group continued its policy of strengthening and building
its positions in its strategic markets initiated in 2010 with
a fundamental redefinition of its scope of activity and an
ambitious capital expenditure program. It thus renewed more
than a quarter of its portfolio of activities in 15
months.
The Group's activities are now more evenly balanced:
LISI AEROSPACE accounts for 44% of consolidated sales, LISI
AUTOMOTIVE for 48% and LISI MEDICAL for 8%.
Return to profitability confirmed
LISI AEROSPACE Fasteners was the main contributor to the
improvement in the results, after a substantial decline in
2010, along with LISI MEDICAL, to a lesser extent. LISI
AUTOMOTIVE reported a slight downturn despite an increase in
activity (up €45 M). All of the management indicators have
therefore improved, despite the disposal of LISI
COSMETICS.
EBITDA reached €122.1 M, corresponding to 13.2% of sales and
an increase of 27.6%. The improvement in the EBIT is
particularly marked with €76.6 M (up 54.9%), due to reversals
of provisions (+ €2.3 M in
2011 against - €0.4 M in 2010), despite the increase in
depreciation (€47.7 M against €45.8 M in 2010). Strengthened
by LISI AEROSPACE's significant contribution compared to
the low point of 2010, the operating margin rose by 1.9
points in comparison to 2010.
The non-recurring costs in 2011 mainly consist of the capital
gain from the disposal of LISI COSMETICS of
+ €9.8 M, and a provision associated with the possible
disposal of assets in Germany of - €1.6 M. Financial expenses
rose to - €1.9 M due to additional debt associated with the
acquisition of the Creuzet group (Net debt of €102.6 M,
resulting in interest costs of €4.2 M) and exchange gains on
working capital (€1.5 M). Tax costs rose sharply, as a
result, among other things, of an increase in corporate tax
in France representing €1.6 M, and CVAE (tax on
companies' added value)1 of - €4.7 M (-
€3.4 M in 2010). The average apparent rate was 27.8% compared
to 30.9% in 2010. Consequently, net earnings reached the
historically high level of €58.2 M compared to €32.9 M in
2010, corresponding to an increase of 76.8%.
1 French business tax on added value
2
Net earnings per share in 2011 were €5.61 (€3.19 in 2010 and
€0.92 in 2009); excluding non-recurring items associated with
the disposal of LISI COSMETICS, earnings would be €4.66.
After returning to dividend growth in 2010, the Group will
propose for approval at the shareholders' General
Meeting to set the dividend at €xx per share for the
financial year of 2011, corresponding to an increase of xx%
compared to last year.
Financial structure still very solid after acquisitions in
2010 and 2011
2011 marked the completion of another stage in the ambitious
industrial equipment and structural investment program
launched in 2010 throughout the divisions: a total of €64.9 M
was paid out. This was mainly dedicated to improving
production and logistics facilities, to productivity and to
new products in all divisions.
Up by nearly 20% to €95.3 M, operating cash flow was slightly
above 10% of sales (10.3%). The Group has not only been able
to finance its capital expenditures program, but also the
increase in working capital requirements of €24.0 M (against
a decrease in 2010 of €25.9 M). The WCR was €243 M on
December 31,
2011, or 25% of sales, compared to €173 M in 2010 (21% of
sales). Measures taken in relation to organization and
productivity, and the implementation of improved logistics
were not enough to compensate for the impact of very strong
growth in the Aerospace Division and the sudden slowdown of
activity at LISI AUTOMOTIVE at the end of the year.
After taking all of these elements into account, the Free
Cash Flow remained positive, rising to €6.4 M (+
€54.8 M in 2010).
The acquisition of the Creuzet group, for a net amount of
€68.1 M, was financed by the proceeds of the disposal of LISI
COSMETICS and €75 M using the medium term credit lines
available to LISI.
At €102.6 M, net debt remains below 20% of equity capital
(18.9%). This represents 0.84 of the EBITDA, substantially
below the prudential ratios required by the banks.
Furthermore, available cash flow has virtually remained
stable, at €68 M on December 31, 2011, compared to €73 M on
December 31, 2010.
The capital employed increased from €561 M to €707 M, taking
into account the consolidation excess allocated to
acquisitions. The return on capital employed before tax
improved to 13.3% compared to 10% in 2010.
LISI AEROSPACE
• Performance has reflected the correct anticipation, in
2010, of a return to growth
• The significant impact of the Creuzet group on sales (+ €59
M), growth focused on Europe, contribution from the United
States again marginal
• Very favorable impact of the new A350 products and
"fastracks" on European activity and on the
operating margin
2011 2010 Change
Sales revenue (in €M) 407.6 281.6 +26.7%
At constant scope and exchange rates
Current operating margin 12.2% 6.8% + 5.4 pts Free cash flow
(€M) 22.7 16.5 + 6.1 M€ As a % of sales revenue 5.6%
5.9% n.a
3
LISI AUTOMOTIVE
New market shares captured
Results under pressure:
o impact of the sudden slowdown in orders in December, due to the lack of time to adjust
o increased use of subcontractors
Recovery of sites that are still under-performing in
progress
2011 2010 Change
Sales revenue (in €M) 446.3 401.3 +8.1%
At constant scope and exchange rates
Current operating margin 5.3% 6.2% - 1.0 pts Free cash flow
(€M) - 11.5 27.3 - 38.8 M€ As a % of sales revenue n.a
6.8% n.a
LISI MEDICAL
First contribution of LISI MEDICAL as a separate division
Impact of the end of the building of inventory on the
activity
Satisfactory contributions from LISI MEDICAL Orthopaedics and
Jeropa (United States)
2011 2010 Change
Sales revenue (in €M) 74.0 42.7 -16.8%
At constant scope and exchange rates
Current operating margin 7.4% 5.0% 2.4 pts
Free cash flow (€M) 4.1 - 5.0 + 9.1 M€
As a % of sales revenue 5.5% n.a n.a
Outlook: acceleration in the Aerospace Division, progress in the Automotive and Medical
Divisions
After a crisis year in 2010 for the Aerospace Division, and
the outstanding recovery of the Automotive Division,
performances in 2011 have fully validated the Group's
ambitious growth policy in terms of capital expenditure,
innovation and gaining market share.
These performances were achieved in a mixed economic
environment: it has been very positive for the aerospace
market, which has fully recovered in Europe, but a little
uncertain for the medical and automotive markets. While
remaining solid, the latter has slowed down in a volatile
context, with too much activity at the beginning of the
financial year, followed by a sudden contraction towards the
end of the year. Despite objectives generally being reached,
the consolidated operating margin is still not at the
normative level that the Group considers to be 10%.
The LISI Group has thus completed another step towards its
objective of a two-figure consolidated operating margin,
while at the same time maintaining a substantially positive
Free Cash Flow.
4
All of the divisions will be called upon to contribute:
• The Aerospace Division has the potential for significant
growth, mainly in the United States. The requirements of the
large 2012 - 2022 contract obtained from BOEING, the start of
the B787 and an increase in production rates should result in
a larger contribution from the American platform. The Creuzet
group's contribution over the next twelve months should
also be significant, given that Indraero Siren should improve
its performance.
• Several problems related to the Automotive Division's
activity should be eliminated, notably in Germany, and it
should benefit from investments and organizational
initiatives undertaken in 2011. The potential for the
operating margin to recover remains intact, so long as the
volatility of demand from LISI AUTOMOTIVE's large
customers does not disrupt the complex production line.
• The performances of the Medical Division's two
"Fasteners" sites (in Lyon and Escondido in the
United States) should see a significant improvement compared
to 2011, while the "Orthopaedics" plant (in Caen)
should develop a substantial volume of new products. 2012
will therefore be a key year in the consolidation of the LISI
MEDICAL division.
The Group has covered all of its financial repayments for
2012 and 2013 with cash, overdraft facilities or medium term
credit lines.
Supported by its experience and financial solidity, the LISI
Group is pursuing its policy of targeted, profitable growth.
Management and investment initiatives, aimed at completing
numerous projects currently in progress and strengthening the
Group's industrial excellence will be maintained.
The Group feels that the current outlook is generally
positive and does not see any downturns in its markets; as a
result, the Group should achieve, for the first time in its
history, sales in excess of €1 billion in 2012.
Contact
Emmanuel Viellard
Telephone: +33 (0)3 84 57 00 77
Email: emmanuel.viellard@lisi-group.com
Website: www.lisi-group.com
The next announcements will appear after close of trading on Euronext Paris
Q1 2012 financial information: April 26, 2012
General Meeting of Shareholders: April 26, 2012
H1 2012 results: July 26, 2012
Q3 2012 Financial Information: October 24, 2012
LISI shares are listed on the Eurolist compartment B market and are part of the CAC MID 100 - Next 150 index under the ISIN code: FR 0000050353. LISI is a worldwide leading manufacturer of fasteners and assembly components for the Aerospace, Automotive, and medical implants industries. LISI MEDICAL specializes in the subcontracting of implants for groups developing medical solutions.
Reuters:GFII.PA Bloomberg:FII FP
5
LISI Group consolidated income statement
(In €'000) Notes 31/12/2011 31/12/2010
Pre-tax sales 925 095 776 689
Changes in stock, finished products and production in progress 25 668 3 699
Total production 950 763 780 388
Other revenues * 14 457 15 395
Total operating revenues 965 221 795 783
Consumption (275 698) (214 169) Other purchases and external charges (187 797) (160 810)
Value added 501 726 420 803
Taxes and duties ** (7 687) (6 459) Personnel expenses (including temporary employees) (371 952) (318 679)
EBITDA 122 087 95 665
Depreciation (47 718) (45 798) Net provisions 2 274 (399)
EBIT 76 643 49 467
Non-recurring operating expenses (2 931) (1 600) Non-recurring operating revenues 10 645 526
Operating profit 84 356 48 393Financing expenses and revenue on cash (4 401) (2 517)
Revenue on cash 658 430
Financing expenses (5 059) (2 947)
Other interest revenue and expenses 1 588 1 592
Other financial items 9 942 13 135
Other interest expenses (8 354) (11 543) Taxes (of which CVAE (Tax on Companies' Added Value)** (24 270) (14 704) Profit (loss) from assets held for sale 805
Profit (loss) for the period 58 078 32 764attributable as company shareholders' equity 58 225 32 924
Interest not granting control over the company (147) (161)
Earnings per share (in €) 5,61 3,19
Diluted earnings per share (in €) 5,61 3,19
(In €'000) 31/12/2011 31/12/2010
Profit (loss) for the period 58 078 32 764Other elements of overall earnings
Exchange rate spreads resulting from foreign business 4 008 12 324
Tax charge on other portions of global income - -
Other portions of global earnings, after taxes 4 008 12 324
Total overall income for the period 62 086 45 088attributable as company shareholders' equity 62 275 45 194
Interest not granting control over the company (189) (106)
LISI Group consolidated balance sheet
ASSETS(In €'000) Notes 31/12/2011 31/12/2010
LONG-TERM ASSETS
Goodwill 182 611 152 287
Other intangible assets 15 382 17 054
Tangible assets 326 872 278 815
Long-term financial assets 5 642 5 394
Deferred tax assets 23 596 16 146
Other long-term financial assets 24 63
Total long-term assets 554 127 469 759SHORT-TERM ASSETS
Inventories 238 879 177 096
Taxes - Claim on the state 915 1 198
Trade and other receivables 158 847 126 721
Other short-term financial assets 51 883 58 619
Cash and cash equivalents 45 675 22 261
Total short-term assets 496 199 385 896 TOTAL ASSETS 1 050 326 855 654 TOTAL EQUITY AND LIABILITIES(In €'000) Notes 31/12/2011 31/12/2010
SHAREHOLDERS' EQUITY
Capital stock 21 573 21 573
Additional paid-in capital 70 803 70 803
Treasury shares (15 461) (15 028) Consolidated reserves 401 231 379 651
Conversion reserves 1 658 (2 392) Other income and expenses recorded directly as shareholders' equity 3 025 1 933
Profit (loss) for the period 58 225 32 924
Total shareholders' equity - Group's share 541 053 489 463Minority interests 1 458 858
Total shareholders' equity 542 511 490 320LONG-TERM LIABILITIES
Long-term provisions 48 177 39 023
Long-term borrowings 136 408 72 647
Other long-term liabilities 5 725 5 830
Deferred tax liabilities 38 387 34 859
Total long-term liabilities 228 697 152 359SHORT-TERM LIABILITIES
Short-term provisions 14 737 15 232
Short-term borrowings* 63 788 25 709
Trade and other accounts payable 194 711 162 440
Taxes due 5 882 9 594
Total short-term liabilities 279 117 212 975 TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 1 050 325 855 654* of which banking facilities 29 565 7 923
LISI Group consolidated cash flow table
(In €'000 31/12/2011 31/12/2010
Operating activities
Net earnings 58 078 32 764
Elimination of net charges not affecting cash flows:
- Depreciation and non-recurrent financial provisions 47 665 43 823
- Changes in deferred taxes (241) (694)
- Income on disposals, provisions for liabilities and others (8 700) 5 249
Gross cash flow margin 96 801 81 142
Net changes in provisions provided by or used for current operations (1 503) (1 669)
Operating cash flow 95 299 79 474
Income tax expense (revenue) 24 511 15 279
Elimination of net borrowing costs 4 009 2 525
Effect of changes in inventory on cash (33 562) (9 870) Effect of changes in accounts receivable and accounts payable 13 203 23 954
Net cash provided by or used for operations before tax 103 459 111 367
Taxes paid (28 138) (3 453)
Cash provided by or used for operations (A) 75 321 107 914
Investment activities
Acquisition of consolidated companies (100 001) (42 026)
Cash acquired 5 569 1 502
Acquisition of tangible and intangible assets (65 182) (51 974)
Acquisition of financial assets (0)
Change in granted loans and advances (150) 476
Investment subsidies received
Dividends received 2
Total cash used for investment activities (159 765) (92 016)
Disposed cash (6 476)
Disposal of consolidated companies 31 920
Transfer of tangible and intangible assets 277 1 359
Disposal of financial assets 22 5
Total cash from disposals 25 742 1 364
Cash provided by or used for investment activities (B) (134 022) (90 653) Financing activities
Capital increase 1 404
Net disposal (acquisition) of treasury shares
Dividends paid to shareholders of the Group (10 913) (7 216)
Dividends paid to minority interests of consolidated companies
Total cash from equity operations (10 913) (5 812)
Issue of long-term loans 87 914 10 912
Issue of short-term loans 229 79
Repayment of long-term loans (2 062) (3 436) Repayment of short-term loans (18 520) (20 576) Net interest expense paid (4 052) (2 593) Total cash from operations on loans and other financial liabilities 63 509 (15 614)
Cash provided by or used for financing activities (C) 52 596 (21 426)
Effect of change in foreign exchange rates (D) 122 4 686
Effect of adjustments in treasury shares (D) 1 018 1 434
Changes in net cash (A+B+C+D) (4 965) 1 954
Cash at January 1st (E) 72 957 71 003
Cash at year end (A+B+C+D+E) 67 992 72 957
Other short-term financial assets 51 883 58 619
Cash and cash equivalents 45 675 22 261
Short-term banking facilities (29 565) (7 923)
Closing cash position 67 993 72 957
Change in LISI Group consolidated shareholders' equity
(In €'000) Capital stock
Capital-linked premiums (Note 7.3)
Treasury shares
Consolidated reserves
Conversion reserves
Other income and expenses recorded directly as shareholders' equity
Profit for the period, group share
Group's share of shareholders' equity
Minority interests
Total shareholders
' equity
Shareholders' equity at January 1, 2010 21 508 69 853 (16 264) 378 745 (14 662) 2 159 9 422 450 764 -125 450 639
Profit (loss) for the period N (a) 32 924 32 924 -161 32 763
Translation differential (b) 12 270 12 270 54 12 324
Payments in shares (c) 789 232 1 021 1 021
Capital increase 65 950 1 015 389 1 404
Restatements of treasury shares (d) 1 236 627 1 864 1 864
Appropriation of N-1 earnings 9 422 (9 422)
Various (*) -1 086 (1 086) (1 086) Change in scope
Dividends distributed (7 216) (7 216) (7 216)
Reclassification (174) (527) (701) 701
Impact of deferred tax liabilities relative to CVAE (Tax on Companies' Added Value) (e)** (1 391) (1 391) (1 391)
Shareholders' equity at December 31, 2010 21 573 70 803 (15 202) 379 825 (2 392) 1 933 32 924 489 463 858 490 320
789 12 270 859 32 924 46 843
Profit (loss) for the period N (a) 58 225 58 225 (147) 58 078
Translation differential (b) 4 050 4 050 (42) 4 008
Payments in shares (c) 979 979 979
Capital increase
Restatements of treasury shares (d) (259) 113 (146) (146) Appropriation of N-1 earnings 32 924 (32 924) 0 0
Change in methods *** (1 428) (1 428) (1 428) Change in scope **** 789 789
Dividends distributed (10 913) (10 913) (10 913) Restatements of financial instruments (f) ***** 1 277 1 277 1 278
Various (e) (454) (454) (454)
Shareholders' equity at December 31, 2011 21 573 70 803 (15 461) 401 231 1 658 3 025 58 225 541 054 1 458 542 512
including total revenues and expenses posted for the period (a) +
(b) + ( c) + (d) + ( e) 4 050 1 092 58 225 63 367
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