HighCo: Half-Year 2023 Results
Aix-en-Provence, 13 September 2023
(6 p.m.)
HIGHCO: H1 2023 BUSINESS ACTIVITY,
EARNINGS AND PROFITABILITY IN LINE WITH
EXPECTATIONS; ADJUSTED GUIDANCE FOR
2023
H1 2023 business volumes in line with
expectations
- H1 2023 gross
profit of €38.43 m, up 0.3% on a reported basis and LFL1.
- Growth in digital
businesses (H1 up 3.4% LFL) and decline in offline businesses (H1
down 5.5% LFL).
- Slight business
growth in France (H1 up 0.6% LFL) and less significant decline in
International business (H1 down 1.7% LFL).
Slight increase in first-half
results
- Headline PBIT2 of
€10 m, up slightly by 0.4%.
- Operating margin2
of 26%, stable.
- Operating income
of €9.52 M, up 1.7%.
- Adjusted
attributable net income3 of €6.32 m, up 6.9%.
- Adjusted earnings
per share (EPS)3 of €0.31, up 9%.
Financial position remains
strong
- Operating cash
flow of €7.48 m (excluding IFRS 16), stable (down
€0.08 m).
- Net cash4
excluding operating working capital of €14.58 m at
30 June 2023, representing a decrease of €4.47 m compared
to 31 December 2022.
Adjusted guidance for
2023
- Gross
profit revised from “stable” to “slight decrease”.
-
Operating margin revised from “stable” to “slight increase”.
- Increase
in adjusted earnings per share.
(€ m) |
H1 2023 |
H1 2022 |
H1 2023/H1 2022Change |
Gross profit |
38.43 |
38.31 |
+0.3% |
Headline PBIT2 |
10.00 |
9.97 |
+0.4% |
Operating margin2
(%) |
26.0% |
26.0% |
- |
Operational income |
9.52 |
9.36 |
+1.7% |
Attributable net income |
6.34 |
5.91 |
+7.4% |
Adjusted attributable net
income3 |
6.32 |
5.91 |
+6.9% |
Adjusted earnings per share3
(in €) |
0.31 |
0.29 |
+9.0% |
Operating cash flow (excluding IFRS 16) |
7.48 |
7.56 |
(€0.08 m) |
Net cash4 excluding
operating working capital |
14.58 |
19.055 |
(€4.47 m) |
1 Like for like: Based on a comparable scope and
at constant exchange rates (i.e. applying the average exchange rate
over the period to data from the compared period).2 Headline PBIT:
Profit before interest, tax and restructuring costs. Operating
margin: Headline PBIT/Gross profit.3 Adjusted attributable net
income: Attributable net income excluding other operating income
and expenses (H1 2023: income of €0.03 m; H1 2022:
virtually none) and excluding the net after-tax income from assets
held for sale and discontinued operations (no impact); adjusted
earnings per share based on an average number of shares of
20,084,698 at 30 June 2023 and of 20,471,028 at 30 June
2022.4 Net cash (or net cash surplus): Cash and cash equivalents
less gross current and non-current financial debt at the end of the
period.5 At 31 December 2022.
Didier Chabassieu, Chairman of the Management
Board, stated, “HighCo posted a first half of the year in line with
expectations both in terms of business activity and profitability.
The French retail market is currently impacted by inflation, which
remains at record-high levels for food products, and by exceptional
M&A activity. In these unprecedented circumstances, the Group,
building on its sound financial structure and the expertise of its
staff, continues to support brands and retailers in accelerating
the transformation of retail.”
FINANCIAL PERFORMANCE IN H1
2023
H1 2023 business volumes in line with
expectations
As expected, HighCo posted business
growth of 0.3% for H1 2023, with gross profit of
€38.43 m.
With growth of 3.4% over the first half of the
year, Digital benefited especially from the strength of SMS and
push notification activities (up 24% in volume). The share of
digital businesses in the Group’s total gross profit increased from
65.3% in H1 2022 to 67.3% in H1 2023.
Meanwhile, offline businesses fell 5.5% over the
first half of the year.
In France, gross profit rose slightly,
by 0.6%, to €33.4 m in H1 2023. In the first
half of the year, France accounted for 86.9% of the Group’s total
gross profit. Digital businesses grew 4.6% over the first
six months of 2023, and their share increased
significantly to 68.5% of gross profit. Accounting for more than
one-quarter of business in France, Mobile activities remained
stable over the first half of the year (down 0.5%), against a
challenging 2022 comparative base (up 19.7% in H1 2022).
Offline businesses fell 7% in France in H1 2023.
International business fell 1.7% in
H1 2023 to €5.03 m and accounted for 13.1% of
the Group’s gross profit. Down 4.5%, the share of Digital in
International businesses represented 59.3% of gross profit. In
Belgium, as anticipated, gross profit fell
slightly by 2.5%. After several years of decline, the traditional
promotion management business grew in Q2.Business in Other
countries (Spain and Italy) continues to
hold up (up 3.1% against a comparative base of 33.1% in
H1 2022) and accounts for 2% of the Group’s gross profit.
Slight increase in first-half
results
Slight business growth combined with sound cost
control resulted in headline PBIT of €10 m for
H1 2023, up slightly by 0.4%, both in France (up 0.4%
to €8.89 m) and in International business (up 0.4% to
€1.11 m).
Operating margin in
H1 2023 (headline PBIT/gross profit) remained
stable at 26%.
After deducting restructuring costs
(H1 2023: €0.51 m, H1 2022: €0.6 m),
recurring operating income came out at
€9.49 m, up slightly by 1.4% (H1 2022:
€9.36 m).
Operating income in H1 2023
amounted to €9.52 m, for a slight increase of
1.7%.
Financial income totalled €0.36 m, up by
€0.53 m, mainly due to income from cash.
The tax expense stood at €2.71 m in
H1 2023 (H1 2022: expense of €2.49 m). The effective
tax rate rose by 50 basis points to come out at 27.6% for the
period.
Adjusted attributable net income rose by
6.9% to €6.32 m (H1 2022: €5.91 m). The
reported figure also increased by 7.4% to €6.34 m
(H1 2022: €5.91 m).
The Group recorded adjusted EPS of €0.31
in H1 2023, up 9% compared to H1 2022 (€0.29 per
share).
Financial position remains
strong
Cash flow amounted to €9 m, a slight
decrease of €0.15 m from H1 2022. Excluding the impact of
IFRS 16 – Leases, cash flow amounted to €7.48 m,
virtually stable compared with H1 2022 (down
€0.08 m).
Net cash at 30 June 2023 amounted to
€47.91 m, down €22.09 m since 31 December 2022.
Excluding operating working capital (€33.33 m at 30 June
2023), net cash came to €14.58 m,
down €4.47 m from 31 December 2022,
mainly due to high shareholder returns (dividend payout and share
buybacks) totalling €10.97 m in the first half.
H1 2023 HIGHLIGHTS
In the first half of 2023, unprecedented changes
took place on the market for large French food
retailers:
- Inflation, which remains
particularly high for food products (up 11.1% year on year
according to the INSEE), is shrinking the purchasing power of
French consumers. Households have adapted their spending habits,
and in 18 months, the consumption of food items has plummeted
by 12% (INSEE – 2023).
- Large food retailers have started a
price war, which has benefited two chains in particular: E.Leclerc
and Lidl.
- The market is consolidating, with
Carrefour’s recent takeover of the Cora and Match chains.
- Casino group is restructuring as
part of a reshuffle in its share ownership structure and its debt
refinancing plan.
- The market is moving towards
concentration. The top two retail groups in France (E.Leclerc and
Carrefour) are on their way to accounting for half of the
market.
In these unprecedented circumstances, HighCo
supports its clients, brands and retailers on all sales
channels.
Physical stores, which remain
the main sales channel for food items, are faced with two key
challenges:
- bring real solutions to solve the
problem of purchasing power with impactful
promotions, and
- collect data to be
able to communicate with customers after the distribution of paper
flyers is phased out.
At points of sale, HighCo allows big
manufacturers such as P&G to create large-scale
promotional offers. The Group also supports retail
chains including E.Leclerc in developing promotional campaigns
designed to boost store revenue while collecting customer data.
Meanwhile, the Group continues to roll out its
mobile discount coupon solution. In addition to
the pharmacy network, which covers 14,000 connected locations,
the Group announces the first two chains that are currently working
on integrating this innovation into their check-out systems:
Franprix and Casino.
French e-commerce continues to
grow with revenue of €147 bn in 2022 (FEVAD – 2022), a 13.8%
increase from the previous year. The goal for online stores is to
create attractive promotional offers while developing high
value-added digital experiences.On this digital sales
channel, HighCo supports companies such as Mondelez in implementing
promotional offers that highlight its new products on Intermarché’s
click-and-collect website. Useradgents, a HighCo
Group subsidiary, also developed an immersive
universe on the retail website of its client Printemps to
boost sales and collect customer data.
ADJUSTED GUIDANCE FOR 2023
Based on its results reported for H1 2023
and forecast business activity in H2 2023, the Group has
adjusted its 2023 guidance as follows:
- Gross profit
revised from “stable” to “slight decrease” (2022
GP: €77.16 m);
- Operating margin
(headline PBIT/gross profit) revised from “stable” to
“slight increase” (2022 operating margin:
21%);
- Increase in adjusted
earnings per share (2022 adjusted EPS: €0.45).
The Group’s financial resources will mainly be
allocated to:
- Progress on the projects launched
by the startup studio HighCo Venturi (operating investments of
between €1 m and €2 m);
- Capital
expenditure of between €1 m and €2 m
(H1 2023: €1.04 m; 2022: €1.16 m);
- The share buyback programme, more
than €1.5 m (H1 2023: €1.42 m; 2022:
€1.68 m);
- Acceleration of its CSR
strategy.
A conference call with analysts will
take place on 14 September 2023 at 11:00 a.m. (CET).
The presentation will be available at the beginning of the meeting
on the Company’s website (www.highco.com) under Investors >
Financial Information > Financial analysts meetings.
About HighCo
As an expert marketing and
communication, HighCo supports brands and retailers in accelerating
the transformation of retail.Listed in compartment
C of Euronext Paris, and eligible for SME equity savings plans
(“PEA-PME”), HighCo has nearly
500 employees.HighCo has achieved a
Gold rating from EcoVadis, meaning that
the Group is ranked in the top 5% of companies in terms of CSR
performance and responsible purchasing.
Your contacts
Cécile
Collina-Hue Nicolas
CassarManaging
Director Press
Relations+33 1 77 75 65
06 +33
4 88 71 35
46comfi@highco.com n.cassar@highco.com
Upcoming events
Publication takes place after market
close.
Conference call on half-year earnings: Thursday,
14 September 2023 at 11 a.m.Q3 and 9-month YTD 2023 Gross
Profit: Wednesday, 18 October 2023Q4 2023 Gross Profit: Wednesday,
24 January 2024
HighCo is a component stock of the indices CAC®
Small (CACS), CAC® Mid&Small (CACMS), CAC® All-Tradable (CACT),
Euronext® Tech Croissance (FRTPR) and Enternext® PEA-PME 150
(ENPME).ISIN: FR0000054231 Reuters: HIGH.PA Bloomberg: HCO FP For
further financial information and press releases, go to
www.highco.com.
This English
translation is for the convenience of English-speaking readers.
Consequently, the translation may not be relied upon to sustain any
legal claim, nor should it be used as the basis of any legal
opinion. HighCo expressly disclaims all liability for any
inaccuracy herein.
- HighCo CP Résultats S1 2023_FR_VDEF_EN
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