Regulatory News:

ORPEA SA (the "Company") (Paris:ORP) today announces its consolidated revenue for the 1st half of 2023.

While occupancy rates of retirement homes in France remained below expectations, the 2nd quarter of 2023 confirmed the trend observed in the 1st quarter of 2023, with growth of +11.1% vs. the same period last year. This is the result of an overall increase in occupancy rates, with the exception of France, an increase in installed capacity with the contribution of recently opened facilities, and the effects of price increases, which were particularly marked in Central Europe.

Overall, sales for the first half of 2023 totaled €2,539 million, corresponding to year-on-year growth of +10.7%, mostly organic.

As a reminder, and as indicated in the press release published on July 13th, the Company anticipates lower sales growth and a substantial lag in EBITDAR generation for the full year 2023, in the range of -15% to -20% compared with the EBITDAR forecast of €881 million set out in the November 2022 Updated Business Plan communicated to the market on May 12th, 2023 (i.e. EBITDAR 2023 of between €705 million and €750 million).

With regard to the financial restructuring process, the Company reminds that the Accelerated Safeguard Plan (“Plan de Sauvegarde Accélérée”), as approved by the Nanterre Specialized Commercial Court (link) on 24 July through a cross-class cram down, provides for the implementation of three capital increases, starting in the last quarter of 2023 and after the lifting of the last condition precedent1, which will result in a massive dilution for existing shareholders. After these operations, and in the absence of reinvestment, they would hold around 0.04% of the capital, with a theoretical share value of €0.02.

In €m

 

Quarterly figures

 

Half-year figures (30 June)

 

Q2 2022

Q2 2023

Change

o/w organic2

 

H1 2022

H1 2023

Change

o/w organic2

 

France Benelux UK Ireland

 

712

769

+8.0%

+4.6%

1,391

1,489

+7.0%

+5.2%

Central Europe

 

294

335

+14.0%

+13.3%

577

658

+13.9%

+12.9%

Eastern Europe

 

109

129

+18.7%

+18.9%

210

250

+19.2%

+19.3%

Iberian Peninsula and Latam

 

59

69

+18.4%

+17.7%

114

139

+21.4%

+19.7%

Other countries

 

0,9

1,8

ns

ns

1,9

3,6

ns

ns

Total revenue

 

1,175

1,305

11.1%

+8.8%

2,295

2,539

+10.7%

+9.1%

1. Q2 2023 revenue

Revenues reached €1,305 million in the 2nd quarter of 2023, a year-on-year increase of +11.1%, including organic growth of +8.8%.

Continuing from the 1st quarter of 2023, activity in the 2nd quarter is up in all geographical areas, thanks to average occupancy rates that are generally up and the contribution of facilities opened in the last 12 months.

2. H1 2023 revenue

For the first half of 2023, revenue amounted to €2,539 million, up +10.7% compared to the 1st half of 2022, of which +9.1% organically.

The overall level of activity in clinics both in France and internationally, as well as in retirement homes outside of France, is increasing. This evolution is illustrated at the global level, by an average occupancy rate up +136 bps compared to the 1st half of 2022, at 82.7%.

In the France Benelux UK Ireland area, revenue amounted to €1,489 million over the 1st semester, up +7.0% (including +5.2% on an organic basis) compared to the first half of the previous year.

In France, nursing home activity remains far from historical levels, with an average occupancy rate of 83.4% over the period as a whole, down on the same period last year (86.0%). Clinics (Medical and Rehabilitation Care, Mental Health), on the other hand, are experiencing an increase in activity levels, illustrating the diversity of activities and specialties developed within the facilities, in the various regions where the Group is active. Elsewhere in the region, Belgium benefited from the inclusion of 19 new facilities in its scope of consolidation, and business grew despite the closure of seven facilities in Brussels, while the Netherlands posted sustained growth thanks to the ramp-up of new facilities.

In Central Europe, sales rose by 13.9% (+12.9% organic) to €657 million over the half-year. Germany and Switzerland reported good activity momentum over the half-year, with occupancy rates up in both the retirement homes and clinics. In Germany, the good momentum also reflects the premium positioning on this market.

In Eastern Europe, sales rose by 19.2% to €250 million over the half-year, benefiting from a marked increase in the occupancy rate of facilities opened over the past 12 months.

In the Iberian Peninsula and Latin America region, sales came to €139 million for the first half, up 21.4%, mainly on an organic basis, reflecting a marked increase in occupancy rates in Spain, the region's main contributor.

Average occupancy rate by geographical areas

Average occupancy rate

 

Quarterly figures

Half-year figures

 

Q2 2022

Q2 2023

Change

H1 2022

H1 2023

Change

France Benelux UK Ireland

 

83.4%

82.5%

(91)bps

84.2%

83.1%

(105)bps

Central Europe

 

79.4%

82.0%

+268bps

78.7%

81.8%

+304bps

Eastern Europe

 

81.9%

85.8%

+387bps

81.4%

84.6%

+323bps

Iberian Peninsula and Latam

 

75.3%

81.8%

+647bps

74.8%

82.5%

+766bps

Other countries

 

ns

ns

ns

ns

ns

ns

Total group

 

81.2%

82.4%

+118bps

81.3%

82.7%

+136bps

3. Update on the ash and debt position at June 30th, 2023

The Group's cash position at June 30, 2023 is estimated at €527 million (unaudited figure), in line with expectations, for a net financial debt of €9,328 million (including accrued interest of €184 million; unaudited figure and excluding other IFRS adjustments).

Over the 2nd half of 2023, liquidity requirements until the completion of the Accelerated Safeguard Plan will be covered by additional financing arranged by the Group's main banking partners. In particular, tranche D1B of €200 million should be drawn down by early August 2023, all conditions precedent having been met.

About ORPEA

ORPEA is a leading global player, expert in providing care for all types of frailty. The Group operates in 21 countries and covers three core businesses: care for the elderly (nursing homes, assisted living facilities, homecare and services), post-acute and rehabilitation care and mental health care (specialized clinics). It has more than 76,000 employees and welcomes more than 267,000 patients and residents each year.

https://www.orpea-group.com/en

ORPEA is listed on Euronext Paris (ISIN: FR0000184798) and is a member of the SBF 120, MSCI Small Cap Europe and CAC Mid 60 indices.

Disclaimer - forward-looking information

This press release contains forward-looking statements that involve risks and uncertainties, including those included or incorporated by reference, regarding the Group's future growth and profitability that could cause actual results to differ materially from those indicated in the forward-looking statements. These risks and uncertainties relate to factors that the Company cannot control or accurately estimate, such as future market conditions. The forward-looking statements in this press release constitute expectations of future events and should be treated as such. Actual events or results may differ from those described in this document due to a number of risks or uncertainties described in the Company's 2022 Universal Registration Document, which is available on the Company's website and on the AMF website (www.amf-france.org).

---

1 The final condition precedent is the purging of appeals lodged against the waiver of the Caisse des Dépôts-led consortium's obligation to launch a takeover bid for ORPEA shares, granted on May 26, 2023.The decision by the Paris Court of Appeal is expected in the 4 quarter of 2023.

2 Organic growth of Group revenue reflects the following factors: 1. The year-on-year change in the revenue of existing facilities as a result of changes in their occupancy rates and per diem rates; 2. The year-on-year change in the revenue of redeveloped facilities or those where capacity has been increased in the current or year-earlier period; 3. Revenue generated in the current period by facilities created during the year or year-earlier period, and 4. the change in revenue of recently acquired facilities by comparison with the previous equivalent period

Investor Relations ORPEA Benoit Lesieur Investor Relations Director b.lesieur@orpea.net

Toll-free number for shareholders : 0 805 480 480

Investor Relations NewCap Dusan Oresansky Tel: 01 44 71 94 94 ORPEA@newcap.eu

Press Relations ORPEA Isabelle Herrier-Naufle Press Relations Director Tel: 07 70 29 53 74 i.herrier-naufle@orpea.net

Image7 Charlotte Le Barbier // Laurence Heilbronn 06 78 37 27 60 - 06 89 87 61 37 clebarbier@image7.fr lheilbronn@image7.fr

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