Elis: H1 2023 results
Very solid H1
2023 results
Record revenue,
significant profitability
improvement, further
deleveraging
Full-year 2023
profitability objectives raised
Very solid results despite inflation
and
continuing
geopolitical uncertainties
- Revenue of
€2,101.3m (+17.8% of which +15.2% organic)
- Adjusted EBITDA
margin up +90bps to 33.2% of revenue
- Adjusted EBIT
margin up +200bps to 15.1% of revenue
- Net income up
+158.3% to €138.8m
- Headline net income
up +33.3% to €197.7m
- Headline net income
per share up +25.5% at €0.78 (on a fully diluted basis)
- Free cash flow
(after lease payments) at €16.9m, in line with the usual
seasonality of the first half
- Financial leverage
ratio down to 2.4x as of June 30, 2023
Strong revenue growth:
commercial achievements in Workwear, good pricing momentum to
offset cost inflation and
satisfactory activity in Hospitality
- Record level of new
Workwear contracts signed in the first half, driven by Elis’ many
commercial initiatives
- Good activity in
Hospitality, especially in France
- Very favorable
pricing momentum across all our markets, driven by the
carry-forward effect of the adjustments implemented throughout 2022
and those put in place since January 1, 2023
Improvement in EBITDA margin driven
by operating leverage,
productivity gains and neutral balance of
inflationary impacts
- Strong improvement
of adjusted EBITDA margin in Southern Europe, Latin America and
France, notably due to the activity rebound in Hospitality
- Further
productivity gains with marked improvement on the logistics side
and on energy consumption
- Pricing effect is
c. +11% in H1 ; the increase in our cost base is c. +10%
- Highly selective
approach on new bids and contract renewals, sometimes leading to
contract losses
Further deployment of
our CSR strategy
- Improvement of
Elis’ extra-financial ratings, rewarding the Group’s CSR
strategy
- Elis will present
its climate plan during an event on September 4, 2023, along with
an update on current trading
2023
profitability objectives
raised
- 2023 full-year
organic revenue growth now expected at c. +12% (previously expected
between +11% and +13%)
- 2023 adjusted
EBITDA margin now expected up c. +70bps yoy (previously expected at
c. +50bps yoy)
- 2023 adjusted EBIT
now expected above €660m (previously expected above €650m)
- 2023 headline net
income now expected above €410m (previously expected above
€405m)
- 2023 headline net
income per share still expected above €1.65 on a fully diluted
basis (up at least +13% yoy)
- 2023 free cash flow
(after lease payments) still expected above €260m (up at least +16%
yoy)
- Financial leverage
ratio at December 31, 2023 still expected at c. 2.1x
Saint-Cloud,
July 26,
2023 – Elis, an international
multi-service provider, offering textile, hygiene and facility
services solutions, which is present in Europe and Latin America,
today announces its 2023 half-year financial results. The accounts
have been approved by the Management Board and examined by the
Supervisory Board today. They have been subject to a limited review
by the Company’s auditors.
Commenting on the announcement, Xavier
Martiré, CEO of Elis, said:
“Our H1 2023 results are very satisfactory. Elis
recorded revenue growth of 17.8% at 2.1 billion euros, and its main
financial indicators - EBITDA margin, EBIT margin and earnings per
share - improved significantly.
Organic revenue growth was up 15.2% in the first
half, driven by a price effect of around 11%, reflecting the
adjustments negotiated since the beginning of 2022 to offset cost
inflation.
Sales momentum was also strong in all our
geographies. Our offers, which address the increasing needs of our
clients for hygiene, traceability and for a more secure supply
chain, continue to be a resounding success, and we achieved a
record number of new contracts in Workwear in the first half.
Finally, activity in Hospitality was well oriented in H1.
M&A activity was subdued in H1, but the
Group’s appetite remains intact, and we intend to continue our
selective acquisition strategy. We are very pleased with the
excellent performance of our Mexican asset that has been integrated
since July 2022 and whose results are sharply above initial
expectations.
On the industrial side, further optimization of
production processes in all geographies led to significant
productivity gains in H1, especially for workshop costs, logistics
and resource consumption.
Top line momentum, the neutral balance of
inflationary impacts and operational enhancements drove the marked
improvement of our H1 financials: EBITDA margin increased 90bps,
EBIT margin increased 200bps and net income per share increased by
more than 25% on a fully diluted basis. The Group also continued
its deleveraging trajectory, with a financial leverage ratio of
2.4x at June 30, 2023.
This good first-half performance allows us to
raise the Group’s profitability objectives for the full year: we
now expect 2023 EBITDA margin to be up c. 70bps and 2023 EBIT to be
above 660 million euros. Deleveraging will continue, with the
financial leverage ratio expected at c. 2.1x at December 31, 2023,
which should quickly make the Group eligible for investment grade
rating consideration.
In the first half, Elis also continued its
initiatives related to the circular economy and the recycling of
its textiles. The Group is also defining its climate strategy and
will announce its emission reduction targets, aligned with the
Paris Agreement, on September 4, 2023.
The great resilience that Elis has demonstrated
through the various recent crises, its operational know-how, its
strengthened organic growth profile and its model based on the
principles of the circular economy are major assets that will
enable the Group to continue to assert its leadership in all the
countries in which it operates.”
I. 2023
half-year results
H1 2023
revenue
In millions of
euros |
Q1 |
2023Q2 |
H1 |
Q1 |
2022Q2 |
H1 |
Q1 |
Var.Q2 |
H1 |
France |
303.5 |
336.8 |
640.3 |
262.1 |
301.9 |
564.0 |
+15.8% |
+11.6% |
+13.5% |
Central Europe |
245.6 |
251.8 |
497.3 |
196.6 |
214.1 |
410.7 |
+24.9% |
+17.6% |
+21.1% |
Scandinavia &
East. Eur. |
153.3 |
146.8 |
300.1 |
135.3 |
145.0 |
280.2 |
+13.3% |
+1.3% |
+7.1% |
UK &
Ireland |
121.9 |
135.5 |
257.3 |
102.7 |
121.5 |
224.2 |
+18.7% |
+11.5% |
+14.8% |
Latin America |
102.4 |
111.3 |
213.7 |
64.2 |
76.8 |
141.0 |
+59.6% |
+44.9% |
+51.6% |
Southern
Europe |
81.3 |
98.7 |
179.9 |
65.2 |
85.1 |
150.3 |
+24.7% |
+16.0% |
+19.8% |
Others |
5.5 |
7.1 |
12.6 |
6.8 |
6.7 |
13.5 |
-19.1% |
+5.4% |
-6.9% |
Total |
1,013.4 |
1,087.9 |
2,101.3 |
832.8 |
951.0 |
1 783.8 |
+21.7% |
+14.4% |
+17.8% |
« Others » includes Manufacturing
Entities and
Holdings. Percentage
change calculations are based on actual figures.
H1 2023 revenue
breakdown
In millions of
euros |
H1 2023 |
H1 2022 |
Organic growth |
External growth |
FX |
Reported growth |
France |
640.3 |
564.0 |
+13.5% |
- |
- |
+13.5% |
Central Europe |
497.3 |
410.7 |
+18.9% |
+1.4% |
+0.7% |
+21.1% |
Scandinavia &
East. Eur. |
300.1 |
280.2 |
+11.5% |
+0.5% |
-4.9% |
+7.1% |
UK &
Ireland |
257.3 |
224.2 |
+18.5% |
- |
-3.7% |
+14.8% |
Latin America |
213.7 |
141.0 |
+10.9% |
+40.2% |
+0.5% |
+51.6% |
Southern
Europe |
179.9 |
150.3 |
+19.4% |
+0.3% |
- |
+19.8% |
Others |
12.6 |
13.5 |
-4.4% |
- |
-2.5% |
-6.9% |
Total |
2,101.3 |
1,783.8 |
+15.2% |
+3.6% |
-1.0% |
+17.8% |
« Others » includes Manufacturing
Entities and
Holdings. Percentage
change calculations are based on actual figures.
H1 2023 organic
revenue growth
|
Q1 2023 organic growth |
Q2 2023 organic growth |
H1 2023organic growth |
France |
+15.8% |
+11.6% |
+13.5% |
Central Europe |
+21.4% |
+16.7% |
+18.9% |
Scandinavia &
East. Eur. |
+15.8% |
+7.4% |
+11.5% |
UK &
Ireland |
+23.9% |
+13.9% |
+18.5% |
Latin America |
+12.6% |
+9.5% |
+10.9% |
Southern
Europe |
+24.7% |
+15.4% |
+19.4% |
Others |
-15.4% |
+6.6% |
-4.4% |
Total |
+18.3% |
+12.5% |
+15.2% |
« Others » includes Manufacturing
Entities and
Holdings. Percentage
change calculations are based on actual figures.
Q2 2023
revenue
In millions of
euros |
Q2 2023 |
Q2 2022 |
Organic growth |
External growth |
FX |
Reported growth |
France |
336.8 |
301.9 |
+11.6% |
- |
- |
+11.6% |
Central Europe |
251.8 |
214.1 |
+16.7% |
- |
+0.9% |
+17.6% |
Scandinavia &
East. Eur. |
146.8 |
145.0 |
+7.4% |
+0.3% |
-6.4% |
+1.3% |
UK &
Ireland |
135.5 |
121.5 |
+13.9% |
- |
-2.4% |
+11.5% |
Latin America |
111.3 |
76.8 |
+9.5% |
+38.0% |
-2.6% |
+44.9% |
Southern
Europe |
98.7 |
85.1 |
+15.4% |
+0.6% |
- |
+16.0% |
Others |
7.1 |
6.7 |
+6.6% |
- |
-1.2% |
+5.4% |
Total |
1,087.9 |
951.0 |
+12.5% |
+3.2% |
-1.3% |
+14.4% |
« Others » includes Manufacturing
Entities and
Holdings. Percentage
change calculations are based on actual figures.
H1 2023
adjusted
EBITDA
In millions of
euros |
H1 2023reported |
H1 2022restated1 |
Var. H1 2023 / H1 2022 |
France |
250.4 |
209.7 |
+19.4% |
As of % of
revenue |
39.0% |
37.0% |
+190bps |
Central Europe |
147.3 |
121.5 |
+21.2% |
As of % of
revenue |
29.5% |
29.4% |
= |
Scandinavia &
East. Eur. |
106.5 |
100.7 |
+5.7% |
As of % of
revenue |
35.5% |
35.9% |
-50bps |
UK &
Ireland |
76.5 |
67.4 |
+13.6% |
As of % of
revenue |
29.7% |
30.0% |
-30bps |
Latin America |
73.6 |
45.6 |
+61.1% |
As of % of
revenue |
34.4% |
32.4% |
+200bps |
Southern
Europe |
53.0 |
39.4 |
+34.6% |
As of % of
revenue |
29.4% |
26.2% |
+320bps |
Others |
(9.1) |
(7.9) |
+15.1% |
Total |
698.1 |
576.4 |
+21.1% |
As of % of
revenue |
33.2% |
32.3% |
+90bps |
1: A reconciliation is provided in the “Restated
income statement for prior financial years” section of this
release.Margin rates and percentage change calculations are based
on actual figures.
France
H1 revenue was up +13.5% (entirely organic). On
top of a favorable comparable base (Q1 2022 was still impacted by
the Omicron variant), activity in Hospitality was well oriented,
especially in Paris. Pricing dynamic was good and helped offset
cost inflation. We recorded many contract wins in Workwear and Pest
Control but our strong pricing discipline resulted in some losses
in the other segments.
Logistics productivity gains, as well as the
neutral balance of inflationary impacts, allowed an adjusted EBITDA
margin improvement of +190bps in the first half of 2023, to
39.0%.
Central Europe
The region’s revenue was up +21.1% (+18.9% on an
organic basis). In Germany, most price adjustments negotiated in
2022 to offset strong inflation (especially on wages) were
implemented at the beginning of 2023, in particular for our clients
in Healthcare. The country’s organic revenue growth exceeded +20%
in the first half. All other countries in the region delivered
organic growth of c. +15% or more, with similar pricing dynamics
and contract wins in Industry and Trade & Services, especially
in Poland and the Netherlands. As in France, the Group's pricing
discipline occasionally led to contract losses, notably in
Healthcare in Germany.
H1 2023 adjusted EBITDA margin was stable in the
first half compared to the same period last year, at 29.5%. The
gradual implementation of price adjustments, and productivity
gains, notably in logistics, offset the persistent high inflation
in the region, especially in Germany. Our energy costs are rising
in the geography, as 2022 volumes were hedged at prices below
today’s.
Scandinavia & Eastern Europe
Revenue was up +7.1% in the region (+11.5% on an
organic basis), driven by the strong pick-up in Hospitality,
especially in Sweden and Denmark (with a favorable comparable base
in Q1). Commercial momentum was very good in Workwear (including
Cleanroom).
Adjusted EBITDA margin was down -50bps compared
to H1 2022 at 35.5%. Inflation remains high, pricing negotiations
are often more difficult, particularly with public healthcare
clients, and the continuing recovery in Hospitality had a slightly
dilutive effect on margin in the region.
UK & Ireland
Revenue was up +14.8% in the region (+18.5% on
an organic basis). The Group recorded a good performance in
Hospitality, with a favorable comparable base in Q1. Pricing
momentum is very good in the region. We also signed new contracts
in Industry and Trade & Services thanks to strong commercial
initiatives. However, our client’s activity seems to be affected by
the deteriorating macro environment in the UK.
Adjusted EBITDA margin was down -30bps in the
first half compared to H1 2022, at 29.7%. UK margin was up, but
margin in Ireland was down as H1 2022 was boosted by the tail end
of pandemic-related subsidies. Restated for this one-off, the
region's margin was up.
Latin America
Revenue was up +51.6% in the region (+10.9% on
an organic basis). Inflation in the region continues to fall below
10% while the outsourcing trend continues. The acquisition of the
Mexican market leader, consolidated since July 1, 2022, contributed
significantly to the strong scope effect recorded in H1 (+40.2%).
Activity was very satisfactory in H1, with many new signings in
Workwear. FX was virtually neutral for the half-year (+0.5%).
Adjusted EBITDA margin was strongly up +200bps
in the first half compared to H1 2022 at 34.4%, driven by the
integration of the Mexican asset as well as productivity gains in
other countries.
Southern Europe
Revenue was up +19.8% in the region (+19.4% on
an organic basis). As expected, Hospitality benefited from a very
favorable comparable base and delivered significant growth. In
Workwear, commercial momentum and outsourcing trend continued.
Finally, the pricing level was satisfactory in the region.
Strong revenue growth and productivity gains led
to +320bps adjusted margin improvement in H1 2023, to 29.4%.
Adjusted EBITDA to net
income
In millions of
euros |
H1 2023 reported |
H1 2022 restated1 |
Var. |
Adjusted
EBITDA |
698.1 |
576.4 |
+21.1% |
As a % of
revenue |
33.2% |
32.3% |
+90bps |
D&A |
(381.7) |
(344.0) |
|
Adjusted EBIT |
316.4 |
232.4 |
+36.2% |
As a % of
revenue |
15.1% |
13.0% |
+200bps |
Current operating
income |
305.3 |
221.2 |
+38.0% |
Amortization of
intangible assets recognized in a business combination |
(41.3) |
(40.7) |
|
Goodwill
impairment |
- |
(58.7) |
|
Non-current
operating income and expenses |
(21.5) |
(1.2) |
|
Operating
income |
242.4 |
120.7 |
+100.8% |
Net financial
result |
(56.9) |
(28.9) |
|
Income tax |
(46.7) |
(38.0) |
|
Income from
continuing operations |
138.8 |
53.7 |
+158.3% |
Net income |
138.8 |
53.7 |
+158.3% |
1: A reconciliation is provided in the “Restated
income statement for prior financial years” section of this
release.Margin rates and percentage change calculations are based
on actual figures.
Adjusted EBIT
As a percentage of revenue, adjusted EBIT was up
+200bps in H1 2023, due to the decrease in linen capex in 2020 and
in 2021, and the inertia of industrial capex depreciation in
relation to inflation (its depreciation period being much longer
than linen), leading to a decrease in depreciation as a percentage
of sales in the first half (18.2% vs. 19.3% in H1 2022).
Operating income
The main items between EBIT and Operating income
are as follows:
- Expenses related to
free-share plans correspond to the requirements of the IFRS 2
accounting standard. They are stable in H1 2023 compared to H1
2022, at €10.3m,
- The amortization of
intangible assets recognized in a business combination is mainly
related to the goodwill allocation of Berendsen. In H1 2023, the
aggregate was stable compared to H1 2022,
- Non-current
operating expenses are increasing strongly, driven by the
revaluation of the earn-out related to the 2022 Mexican
acquisition. The financial outlook for the acquired group has been
revised upwards in light of its performance in H1 2023,
- As a reminder, the
Group booked a €58.7m goodwill impairment in Russia, on June 30,
2022, in accordance with accounting standards.
Net financial result
In H1 2023, net financial expense was €56.9m. It
is c. €28m higher compared to H1 2022, mainly due to a base effect
(high foreign exchange gains in H1 2022), the accretion of the
earn-out on the acquisition in Mexico in 2022, and interests on new
financings put in place in 2022.
Net income
Net income was up +158.3% at €138.8m in H1
2023, compared to €53.7m in H1 2022.
Net income to headline net income
In millions of
euros |
H1 2023 reported |
H1 2022 restated1 |
Var. |
Net income |
138.8 |
53.7 |
+158.3% |
Amortization of
intangible assets recognized in a business combination2 |
32.9 |
32.6 |
|
IFRS 2
expenses2 |
9.8 |
10.2 |
|
Goodwill
impairment |
- |
58.7 |
|
Exceptional foreign
exchange gains2 |
- |
(7.9) |
|
Non-current
operating income and expenses2 |
16.3 |
1.0 |
|
Headline net
income |
197,7 |
148.4 |
+33.3% |
Non-controlling
interests |
(0.0) |
0,0 |
|
Headline net income
attributable to owners of the parent (A) |
197.7 |
148.4 |
+33.2% |
Convertible related
interests (B) |
(8.1) |
(3.5) |
|
Share count – basic
(C) |
232.6 |
231.0 |
|
Share count – fully
diluted (D) |
263.4 |
245.1 |
|
Headline net income
per share (in euros): |
|
|
|
- basic,
attributable to owners of the parent = A/C |
0.85 |
0.64 |
+32.3% |
- diluted,
attributable to owners of the parent = (A-B)/C |
0.78 |
0.62 |
+25.5% |
1: A reconciliation is provided in the “Restated
income statement for prior financial years” section of this
release.2: Net of tax effect.
Headline net income was €197.7m in H1 2023, up
+33.3% compared to H1 2022 and headline net income per share was up
+25.5% at €0.78 (on a fully diluted basis).
Cash flow statement
In millions of
euros |
H1 2023 reported |
H1 2022 restated1 |
Adjusted
EBITDA |
698.1 |
576.4 |
Non-recurring items
and changes in provisions |
(6.8) |
(2.0) |
Acquisition and
disposal expenses |
(0.5) |
(1.7) |
Other |
(0.9) |
(0.8) |
Cash flow before
finance costs and tax |
689.9 |
571.9 |
Net capex |
(414.1) |
(320.9) |
Change in working
capital requirement |
(85.9) |
(81.6) |
Net interest
paid |
(63.7) |
(53.2) |
Tax paid |
(56.5) |
(50.8) |
Lease liabilities
payments - principal |
(52.9) |
(48.5) |
Free cash flow
(after lease liabilities payments) |
16.9 |
17.0 |
Acquisitions of
subsidiaries, net of cash acquired |
(61.7) |
(32.4) |
Changes arising
from obtaining or losing control of subsidiaries or other
entities |
(4.0) |
(1.8) |
Other cash flows
related to financing activities |
(4.0) |
0.9 |
Dividends and
distributions paid |
(61.7) |
(33.2) |
Equity increase
& treasury shares |
0.5 |
0.4 |
Other |
16.8 |
5.6 |
Net debt
variance |
(97.3) |
(43.5) |
|
June 30, 2023 |
December 31, 2022 |
Net financial
debt |
3,275.4 |
3,178.0 |
1: A reconciliation is provided in the “Restated
income statement for prior financial years” section of this
release.
Net capex
In H1 2023, the Group’s net capex were up c.
€93m vs H1 2022. As a percentage of revenue, they represented
19.7%, compared to 18.0% in the same period last year. The ratio
increase reflects the return to a normative seasonality of our
activity, with most investments made in the first half of the year
to prepare the season. As a reminder, in 2022, only 45% of
investments had been made in the first half of the year, due to
weak Hospitality activity and to supplier delays linked to the
disruption of the global supply chain.
Change in working capital requirement
In H1 2023, change in WCR was strongly negative
at c. -€86m, reflecting the impact of the strong activity pick-up
on trade receivables, and negative payables. The Group recorded
good cash collection ratios: average payment time was 54 days at
June 30, 2023, and 55 days as at June 30, 2022.
Free cash flow
In H1 2023, free cash flow (after lease
liabilities payments) was €16.9m, in line with the Group’s
normative cash generation seasonality and yearly target.
Net financial debt and
financing
The Group’s net financial debt as of June 30,
2023 stood at €3,275.4m compared to €3,178.0m at December 31, 2022
and €3,187.3m at June 30, 2022. The financial leverage ratio was
2.4x at June 30, 2023 compared to 2.5x at December 31, 2022 and
2.7x at June 30, 2022.
On July 20, 2023, the Group signed a new $200m
USPP financing with a group of US investors led by MetLife
Investment Management. The new notes have a 12-year maturity (July
2035) and will offer to investors a 6.03% coupon in US dollars.
Elis has swapped the notes into euros for a total amount of €183
million and will pay a 5.21% coupon in euros.
Payout for the 2022
financial year
The General Shareholders Meeting held on May 25,
2023 decided to offer each shareholder the option of receiving
dividend payments of €0.41 per share for the financial year 2022 in
cash or in new shares. The issue price of the new shares issued in
payment of the dividend was set at €16.39. At the end of the
option, 34.72% of the rights were exercised in favor of the payment
in shares. The amount of the dividend for the financial year 2022
paid in cash to shareholders who opted for payment in kind amounted
to €61.7m (excluding fees) and was paid in June.
II. 2023 profitability objectives
raised
- 2023 full-year
organic revenue growth now expected at c. +12% (previously expected
between +11% and +13%)
- 2023 adjusted
EBITDA margin now expected up c. +70bps yoy (previously expected at
c. +50bps yoy)
- 2023 adjusted EBIT
now expected above €660m (previously expected above €650m)
- 2023 headline net
income now expected above €410m (previously expected above
€405m)
- 2023 headline net
income per share still expected above €1.65 on a fully diluted
basis (up at least +13% yoy)
- 2023 free cash flow
(after lease payments) still expected above €260m (up at least +16%
yoy)
- Financial leverage
ratio at December 31, 2023 still expected at c. 2.1x
III. CSR developments
The circular economy at the heart of Elis’ business
model
Elis offers its clients products that are
maintained, repaired, reused, and reemployed to optimize their
usage and lifespan. The Group therefore selects its textile
products based on sustainability criteria, to ensure frequent
washing, and also operates repair workshops. Elis’ conviction is
that the circular economy model, which notably aims at reducing
consumption of natural resources by optimizing the lifespan of
products, is a sustainable solution to address today’s
environmental challenges.
The services offered by Elis are a sustainable
alternative to:
- Simple purchase or
use of products: by mutualizing them between several users or
clients, and by constantly looking at improving the industrial
processes linked to their washing. As an example, the use of
workwear operated by Elis leads to a 37% decrease of CO2 emissions
compared to workwear that is washed at home or in a standard
laundry, and to a 48% decrease of water consumption. (Source:
EY)
- Single use /
disposable products: by offering reusable products, which are
mostly maintained locally, hence supporting local employment and
local economic development. As an example, the use of reusable
surgical garments in care facilities leads to a decrease ranging
from 31% to 62% of CO2 emissions compared to disposable clothes.
(Source: Cleaner Environmental Systems)
These alternatives to a linear consumption
approach enable our clients to avoid CO2 emissions and contribute
to a reduction of their own emissions.
The Ellen MacArthur Foundation states that
“circular economy is necessary to reach Net Zero” and that “nearly
10 billion tons of CO2 (i.e., 20% of world emissions) could be
reduced thanks to the transition of our current model towards a
circular economy”.
(https://climate.ellenmacarthurfoundation.org)
Non-financial rating
In 2022, Sustainalytics improved Elis’s ESG
notation by 10pts at 14.8 (“low risk”). The Group was rated A- by
the CDP (Carbon Disclosure Project), a non-profit organization
which performs independent assessments on the basis of information
made available by companies on their strategy, risk &
opportunity management, climate goals, annual climate performance,
etc… This assessment places the Group in the “Leadership” category
and underlines its commitment and action in the area of climate
change.
Furthermore, the Group was also rated A by the
CDP Supplier Engagement Leaderboard which places Elis in the top 8%
of companies assessed for their climate-friendly actions across the
value chain.
Elis repeated its excellent performance in
EcoVadis questionnaire, maintaining its score of 75/100 in an
increasingly demanding CSR context. Elis obtained a Gold medal
placing it within the top 5% of the c. 100,000 companies assessed
by EcoVadis.
Finally, Elis improved its score with rating
agency Gaïa (75 vs 73 previously), maintaining its “Gold”
level.
Our climate
commitment
Conscious of the environmental challenges with
regard to climate change, Elis is committed to an approach to
reduce its emissions that is in line with the Paris Agreement to
contribute to keeping the increase in temperature below 1.5C°
compared to preindustrial levels1. The Group will thus present
climate objectives that are aligned with the methodology of the
Science Based Target initiative on September 4, 2023.
IV. Other information
Restated income statement for prior financial
years
The table below presents the adjustments made
retrospectively linked to business combinations (IFRS3) on the
previously published income statement as of June 30, 2022.
In millions of
euros |
H1 2022 reported |
IFRS 3 |
H1 2022restated |
Revenue |
1,783.8 |
- |
1,783.8 |
Adjusted
EBITDA |
576.4 |
- |
576.4 |
D&A |
(344.0) |
- |
(344.0) |
Adjusted EBIT |
232.4 |
- |
232.4 |
Current operating
income |
221.2 |
- |
221.2 |
Amortization of
intangible assets recognized in a business combination |
(40.4) |
(0.3) |
(40.7) |
Goodwill
impairment |
(58.7) |
- |
(58.7) |
Non-current
operating income and expenses |
(1.2) |
- |
(1.2) |
Operating
income |
121.0 |
(0.3) |
120.7 |
Net financial
result |
(28.9) |
- |
(28.9) |
Income tax |
(38.1) |
0.1 |
(38.0) |
Income from
continuing operations |
53.9 |
(0.2) |
53.7 |
Net income |
53.9 |
(0.2) |
53.7 |
Financial definitions
- Organic growth in
the Group’s revenue is calculated excluding (i) the impacts of
changes in the scope of consolidation of “major acquisitions” and
“major disposals” (as defined in the Document de Base) in each of
the periods under comparison, as well as (ii) the impact of
exchange rate fluctuations.
- Adjusted EBITDA is
defined as adjusted EBIT before depreciation and amortization net
of the portion of grants transferred to income.
- Adjusted EBITDA
margin is defined as adjusted EBITDA divided by revenue.
- Adjusted EBIT is
defined as net income (loss) before net financial income (loss),
income tax, share in net income of equity accounted companies,
amortization of intangible assets recognized in a business
combination, goodwill impairment losses, other operating income and
expense, miscellaneous financial items (bank fees recognized in
operating income) and IFRS 2 expense (share-based payments).
- Adjusted EBIT
margin is defined as adjusted EBIT divided by revenue.
- Headline net result
corresponds to net income or loss excluding extraordinary items
which, due to their type and unusual nature, cannot be considered
as intrinsic to the Group’s current performance.
- Free cash flow is
defined as adjusted EBITDA less non-cash-items and changes in
working capital, purchases of linen, capital expenditures (net of
disposals), tax paid, financial interest paid and lease liabilities
payments.
- The financial
leverage ratio is the leverage ratio calculated for the purpose of
the financial covenant included in the banking agreement signed in
2021: Leverage ratio is equal to Net financial debt / adjusted
EBITDA, pro forma of acquisitions finalized during the last 12
months, and after synergies.
Consolidated Financial
Statements
Condensed interim consolidated financial statements for H1 2023
will be available at this address:
https://fr.elis.com/fr/groupe/relations-investisseurs/information-reglementee
Geographical breakdown
- France
- Central Europe:
Germany, Austria, Belgium, Hungary, Luxembourg, Netherlands,
Poland, Czech Republic, Slovakia, Switzerland
- Scandinavia &
Eastern Europe: Denmark, Estonia, Finland, Latvia, Lithuania,
Norway, Russia, Sweden
- UK &
Ireland
- Latin America:
Brazil, Chile, Colombia, Mexico
- Southern Europe:
Spain & Andorra, Italy, Portugal
Presentation of Elis’ 2023
half-year results (in
English)
Date: July 26, 2023 at 5:15pm GMT (6:15pm CET)
Speakers: Xavier Martiré (CEO) and Louis Guyot (CFO)
Webcast link: https://edge.media-server.com/mmc/p/2qh66h4i
Conference call & Q&A session link:
https://register.vevent.com/register/BI23f2c5702cff4f51b5214fc8f288eec6
An investor presentation will be available at 4:50pm GMT (5:50pm
CET) at this
address:https://fr.elis.com/fr/groupe/relations-investisseurs/information-reglementee
Forward looking statements
This document may contain information related to
the Group’s outlook. Such outlook is based on data, assumptions and
estimates that the Group regarded as reasonable at the date of this
press release. Those data and assumptions may change or be adjusted
as a result of uncertainties relating particularly to the economic,
financial, competitive, regulatory or tax environment or as a
result of other factors of which the Group was not aware on the
date of this press release. Moreover, the materialization of
certain risks, especially those described in chapter 4 “Risk
management and internal control” of the Universal Registration
Document for the financial year ended December 31, 2022, which is
available on Elis’s website (www.elis.com), may have an impact on
the Group’s activities, financial position, results or outlook and
therefore lead to a difference between the actual figures and those
given or implied by the outlook presented in this document. Elis
undertakes no obligation to publicly update or revise the Group’s
outlook or any of the abovementioned data, assumptions, or
estimates, except as required by applicable laws and regulations.
Reaching the outlook also implies success of the Group’s strategy.
As a result, the Group makes no representation and gives no
warranty regarding the achievement of any outlook set out
above.
Coming events
- Presentation of
climate objectives and current trading update
Date: September 4, 2023 at 4:45pm GMT (5:45pm
CET)
Speakers: Xavier Martiré (CEO), Louis Guyot
(CFO) and Claire Bottineau (CSR Director)
Webcast link:
https://edge.media-server.com/mmc/p/uwe9gw6w
Conference call contact number for Q&A:
- UK: +44 1 212818004
- US: +1 718 7058796
- France: +33 170918704
- Germany: +49 6917415712
- Spain: +34 917699498
- Italy: + 39 02 802 09 11
- Q3 2023 revenue:
October 26, 2023 (after market)
V. Contact
Nicolas BuronDirector of Investor Relations,
Financing & TreasuryPhone: +33 1 75 49 98 30 -
nicolas.buron@elis.com
Excerpt from condensed interim
consolidated
financial
statements
Interim consolidated income
statement
(in millions
of euros)(unaudited) |
06/30/2023 |
06/30/2022restated |
Revenue |
2,101.3 |
1,783.8 |
Cost of linen,
equipment and other consumables |
(308.0) |
(273.1) |
Processing
costs |
(809.3) |
(698.3) |
Distribution
costs |
(307.4) |
(276.4) |
Gross margin |
676.6 |
536.1 |
Selling,
general and administrative expenses |
(370.7) |
(319.1) |
Net impairment
on trade and other receivables |
(0.7) |
4.1 |
Operating income before amortization of intangible assets
recognized in a business combination, goodwill impairment and other
operating income and expenses |
305.3 |
221.2 |
Amortization
of intangible assets recognized in a business combination |
(41.3) |
(40.7) |
Goodwill
impairment |
- |
(58.7) |
Other
operating income and expenses |
(21.5) |
(1.2) |
Operating income |
242.4 |
120.7 |
Net financial
income (expense) |
(56.9) |
(28.9) |
Income (loss) before tax |
185.5 |
91.8 |
Tax |
(46.7) |
(38.0) |
Income from continuing operations |
138.8 |
53.7 |
Income from
discontinued operation, net of tax |
- |
- |
NET INCOME (LOSS) |
138.8 |
53.7 |
Attributable
to: |
|
|
- owners of
the parent |
138.8 |
53.7 |
-
non-controlling interests |
(0.0) |
0.0 |
Earnings
(loss) per share (EPS) (in euros): |
|
|
- basic,
attributable to owners of the parent |
€0.60 |
€0.23 |
- diluted,
attributable to owners of the parent |
€0.56 |
€0.23 |
Earnings
(loss) per share (EPS) from continuing operations (in euros): |
|
|
- basic,
attributable to owners of the parent |
€0.60 |
€0.23 |
- diluted, attributable to owners of the parent |
€0.56 |
€0.23 |
Interim consolidated statement of financial
position
Assets
(in millions of euros) |
06/30/2023 |
12/31/2022 |
(unaudited) |
|
restated |
Goodwill |
3,974.3 |
3,943.7 |
Intangible
assets |
682.3 |
721.5 |
Right-of-use
assets |
483.7 |
466.9 |
Property,
plant and equipment |
2,138.3 |
2,039.8 |
Other equity
investments |
0.1 |
0.1 |
Other
non-current assets |
74.4 |
79.2 |
Deferred tax
assets |
50.9 |
43.0 |
Employee
benefit assets |
8.0 |
18.7 |
TOTAL
NON-CURRENT ASSETS |
7,412.1 |
7,312.9 |
Inventories |
200.7 |
195.2 |
Contract
assets |
60.4 |
45.5 |
Trade and
other receivables |
839.3 |
748.0 |
Current tax
assets |
27.4 |
18.2 |
Other
assets |
23.4 |
17.4 |
Cash and cash
equivalents |
408.7 |
286.1 |
Assets held
for sale |
- |
0.2 |
TOTAL CURRENT
ASSETS |
1,559.9 |
1,310.6 |
TOTAL ASSETS |
8,972.0 |
8,623.6 |
Equity and
liabilities
(in millions of
euros) |
06/30/2023 |
12/31/2022 |
(unaudited) |
|
restated |
Share
capital |
232.7 |
230.1 |
Additional
paid-in capital |
2,471.2 |
2,440.9 |
Treasury share
reserve |
(1.2) |
(1.7) |
Other
reserves |
(301.5) |
(324.1) |
Retained
earnings (accumulated deficit) |
906.6 |
866.2 |
EQUITY
ATTRIBUTABLE TO OWNERS OF THE PARENT |
3,307.8 |
3,211.5 |
NON-CONTROLLING INTERESTS |
0.8 |
0.8 |
TOTAL
EQUITY |
3,308.6 |
3,212.2 |
Provisions |
91.2 |
91.8 |
Employee benefit
liabilities |
68.3 |
69.4 |
Borrowings and
financial debt |
2,536.1 |
3,034.9 |
Deferred tax
liabilities |
295.3 |
297.0 |
Lease
liabilities |
406.2 |
390.3 |
Other
non-current liabilities |
41.4 |
69.6 |
TOTAL
NON-CURRENT LIABILITIES |
3,438.5 |
3,952.9 |
Current
provisions |
10.3 |
10.4 |
Current tax
liabilities |
27.2 |
24.0 |
Trade and other
payables |
353.6 |
364.9 |
Contract
liabilities |
84.8 |
81.4 |
Current lease
liabilities |
99.9 |
95.2 |
Other
liabilities |
501.0 |
453.4 |
Bank overdrafts
and current borrowings |
1,148.0 |
429.3 |
Liabilities
directly associated with assets held for sale |
- |
- |
TOTAL CURRENT
LIABILITIES |
2,224.8 |
1,458.4 |
TOTAL EQUITY AND LIABILITIES |
8,972.0 |
8,623.6 |
Interim consolidated statement of
cash flows
(in millions of
euros)(unaudited) |
06/30/2023 |
06/30/2022restated |
Consolidated net income (loss) |
138.8 |
53.7 |
Tax |
46.7 |
38.0 |
Net financial
income (expense) |
56.9 |
28.9 |
Goodwill
impairment |
- |
58.7 |
Share-based
payments |
8.4 |
9.8 |
Depreciation,
amortization and provisions |
422.4 |
383.8 |
Portion of
grants transferred to income |
(0.3) |
(0.3) |
Net gains and
losses on disposal of property, plant and equipment and intangible
assets |
1.0 |
1.1 |
Other |
15.9 |
(1.8) |
CASH FLOWS BEFORE FINANCE COSTS AND TAX |
689.9 |
571.9 |
Change in
inventories |
(2.8) |
(24.5) |
Change in
trade and other receivables and contract assets |
(93.4) |
(118.6) |
Change in
other assets |
(4.4) |
(3.1) |
Change in
trade and other payables |
(30.2) |
33.9 |
Change in
contract and other liabilities |
49.5 |
30.8 |
Other
changes |
(1.9) |
(1.0) |
Employee
benefits |
(2.7) |
0.9 |
Tax paid |
(56.5) |
(50.8) |
NET CASH FROM OPERATING ACTIVITIES |
547.5 |
439.6 |
Acquisition of
intangible assets |
(13.4) |
(11.0) |
Proceeds from
disposal of intangible assets |
(0.0) |
- |
Acquisition of
property, plant and equipment |
(402.9) |
(315.7) |
Proceeds from
disposal of property, plant and equipment |
2.0 |
5.6 |
Acquisition of
subsidiaries, net of cash acquired |
(61.7) |
(32,4) |
Proceeds from
disposal of subsidiaries, net of cash transferred |
- |
- |
Changes in
loans and advances |
0.2 |
0.6 |
Dividends
earned |
- |
- |
Investment grants |
0.2 |
0.3 |
NET CASH FROM INVESTING ACTIVITIES |
(475.6) |
(352,7) |
Capital
increase |
0.0 |
(0.0) |
Treasury
shares |
0.5 |
0.4 |
Dividends and
distributions paid |
|
|
- to owners of
the parent |
(61.7) |
(33.2) |
- to
non-controlling interests |
- |
- |
Change in
borrowings (a) |
223.7 |
485.7 |
- Proceeds
from new borrowings |
624.2 |
739.6 |
- Repayments
of borrowings |
(400.5) |
(254.0) |
Lease
liability payments - principal |
(52.9) |
(48.5) |
Net interest
paid (including interest on lease liabilities) |
(63.7) |
(53.2) |
Other cash flows related to financing activities |
(4.0) |
0.9 |
NET CASH FROM FINANCING ACTIVITIES |
41.9 |
352,1 |
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS |
113.8 |
439.0 |
Cash and cash
equivalents at beginning of period |
286.1 |
160.1 |
Effect of changes in foreign exchange rates on cash and cash
equivalents |
3.8 |
6.8 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
403.6 |
605.8 |
(a) Net change
in credit lines |
|
|
1 Reduction in line with the 1.5°C target for direct (Scope 1)
and indirect (Scope 2) emissions, and the well below 2°C target for
other indirect emissions (Scope 3).
- 20230726 - Elis - H1 2023 results
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