Strong Resilience and Solidity of the Group
in the Face of the Crisis
Regulatory News:
Groupe SEB (Paris:SK):
Consolidated financial results (€m)
2019
2020
Change
2019/2020
Sales
7,354
6,940
-5.6%
-3.8% LFL
Operating Result from Activity
(ORfA)
740
605
-18.2%
-4.8% LFL
Operating profit
621
503
-18.9%
Profit attributable to owners of the
parent
380
301
-20.9%
Net debt at 12/31
1,997*
1,518*
-€479m
Proposed dividend per share
€2.26
€2.14**
* incl. IFRS 16 impact of €334m and €339m respectively in 2019
and 2020 % calculated on non-rounded figures ** dividend proposed
to the Annual Shareholders’ general meeting of May 19, 2021 (after
free allocation of 1 new share per 10 existing)
Statement by T. de La Tour d’Artaise, Chairman and CEO of
Groupe SEB:
“The Group successfully adapted to the global pandemic by
leaning on its committed teams, to whom I would like to present my
warmest thanks. In the current difficult context, our very
satisfying results demonstrate the resilience of our model.
This year more than ever has shown consumers’ enthusiasm for
home cooking. Faithful to its corporate mission, the Group brings
consumers durable, high-quality and repairable products meeting all
their needs, while developing at the same time its range of
services and contents. Our strength also lies in our multi-channel
distribution model, combining physical retail sales, e-commerce,
and social media.
With restrictions still in place, our Consumer business remains
sustained at the start of this year and we anticipate our
Professional business to gradually return to normal, potentially as
of the second half of the year. As such, we are confident in the
fact that the Group should return to organic sales growth and
higher Operating Result from Activity in 2021.”
SALES
In the difficult and uncertain environment caused by the
COVID-19 crisis, Groupe SEB posted full-year 2020 turnover of
€6,940m, down 5.6% including a limited organic decrease of 3.8%, a
currency effect of -€219m (-3.0%) and a scope effect (mainly
StoreBound, acquired in July 2020) of +€81m (+1.2%).
The resilience of annual sales stems from the Consumer business,
which ended the year practically stable on a like-for-like basis
(-0.5%), the rebound in the second half (+7.8% LFL) having largely
made up for the decline at end-June (-10.6% LFL). Indeed, the
positive trend in household consumption, particularly in products
for the home, and a sharp ramp-up in online sales as of the initial
lockdowns, offset in part the substantial contraction in in-store
sales (mandatory closures and/or decreased footfall).
Professional revenue fell 30.7% LFL in 2020, impacted by
extremely low business activity in the hospitality and catering
sectors from the second quarter onwards. This situation led our
customers to suspend, postpone or reduce their investments in
equipment (coffee machines) and significantly limited maintenance
interventions.
OPERATING RESULT FROM ACTIVITY (ORfA)
The Group posted Operating Result from Activity (ORfA) of
€605m in 2020. Though down 18.2% from 2019, ORfA was
better than expected thanks to stronger than anticipated sales in
the fourth quarter. Negatively impacted by currency effects (-€109m
versus -€5m in 2019), ORfA included a scope effect of €9m, owing
primarily to the consolidation of StoreBound.
As such, 2020 ORfA at constant exchange rates and scope stands
at €705m, down 4.8%, with the following components:
- A volume effect of -€126m owing to the contraction in business
activity, particularly Professional;
- A price-mix effect of +€60m, reflecting an overall less
promotional small domestic equipment market, continued upgrading of
offer in numerous countries, and price increases made to offset the
depreciation of some currencies;
- A €9m decrease in the cost of sales, purchasing and
productivity gains having exceeded the industrial under-absorption
in the first half and inflation;
- Practically stable investments (-€1m) in growth drivers
(innovation, operational marketing and advertising), maintained at
around 10% of turnover with strong catch-up at the end of the
year;
- A €23m decrease in sales, marketing and administrative
expenses, stemming from both the aid received in some countries in
respect of short-time work (notably France and Germany) and a
reduction in costs.
Amid the exceptional circumstances of 2020, the Group generated
over 80% of its Operating Result from Activity in the second half,
against a backdrop of worsened exchange rates. This performance can
be attributed to the recovery in the Consumer business and the
remarkable mobilization of all the teams.
OPERATING PROFIT AND NET PROFIT
Groupe SEB reported operating profit of €503m in 2020, versus
€621m in 2019. The total includes a non-discretionary and
discretionary employee profit-sharing expense of €24m, compared
with €35m in 2019, the decrease reflecting the downturn in the
results of French entities. It also comprises other operating
income and expense of -€78m (-€82m in 2019). Two-thirds of these
expenses resulted from the finalization of the restructuring of
WMF’s Consumer business, as well as from a reorganization of the
Professional business, strongly impacted by the drop of activity in
the hospitality and catering sectors. The remainder of these
expenses came from several items relating to structure resizing,
acquisition/disposal costs or write-downs of assets.
Financial result came out at -€61m, the same as in 2019. It
notably comprised an external debt cost of €40m (close to that in
2019), including an IFRS 16-related expense of €12.5m.
In these conditions, profit attributable to owners of the parent
amounted to €301m, compared with €380m in 2019. This comes after a
tax charge of €94m, representing an effective tax rate of 21.2% in
2020 (23.5% in 2019) and non-controlling interests of €48m,
practically similar to the amount of 2019, the slight decrease in
Supor results being offset by the inclusion of the minority
interests of StoreBound.
BALANCE SHEET
At December 31, 2020, consolidated equity totaled €2,735m, up
€107m on end-2019.
At December 31, 2020, net debt amounted to €1,518m (of which
€339m in IFRS 16 debt), versus €1,997m a year earlier, showing a
decrease of €479m. The substantial reduction in debt mainly stemmed
from a considerable improvement in the working capital requirement
(WCR), which totaled €848m, down €367m on 2019 and representing
12.2% of sales. In addition to the continued structural
optimization efforts led for more than 10 years, this new and
significant drop in the WCR also resulted from cyclical favorable
seasonality effects in 2020, including:
- strong collections of customer receivables at the end of the
year;
- delayed purchases of some products and services (for example,
investments in growth drivers);
- the positive impact of the downturn in Professional business on
the Customers item.
This very low WCR/sales level thus stands as an exception and
should not be extrapolated for 2021.
At December 31, 2020, the Group’s net debt/consolidated equity
ratio was 56% (compared with 76% at end-2019) and 43% excluding
IFRS 16. The net debt/Adjusted EBITDA ratio came out at 1.8x, and
1.6x excluding the IFRS 16 effect.
FREE ALLOCATION OF SHARES
In order to earn the loyalty of its shareholders, Groupe SEB is
proceeding with a free allocation of shares to their benefit.
Meeting on February 23, 2021, the Board of Directors, making use
of the authorization it has been given by the Combined Annual
Shareholders’ General Meeting of May 19, 2020 under the 19th
resolution, has decided to increase the share capital by €5,030,706
through the incorporation of reserves and/or retained earnings.
This will take the share capital from €50,307,064 to
€55,337,770.
The increase of share capital will be completed on March 3rd,
2021 through the creation of 5,030,706 new, entirely freed up
shares with a nominal value of €1. The shares will be freely
allocated to all shareholders registered on March 2nd, 2021, to the
tune of ONE new share per TEN existing shares. It is specified that
all shares making up the share capital, or 50,307,064 shares, will
carry the same allocation right of 1 new share per 10 existing
shares.
The attribution right will be detached on March 1st, 2021 on the
opening for trade of the Paris-Euronext stock exchange and will
lead to a corresponding adjustment of the share price. The new
shares will bear rights on January 1, 2020 and will be immediately
assimilated to existing shares. They will carry the same rights as
the original shares in terms of double voting rights and dividend
loyalty bonus. They will give right to a dividend in respect of
2020 financial year, paid in 2021.
Rights forming fractional shares shall not be tradeable, nor can
they be sold, and ownership of the related shares shall be fully or
partially maintained by SEB SA as shares held in treasury. SEB SA
will compensate the holders of the fractional shares in respect of
the amounts due at the latest thirty (30) days after the full
number of shares has been recorded in their accounts. The remainder
of potential rights forming fractional shares not maintained by SEB
SA will be sold.
New shares stemming from shares featuring separation of the
legal and beneficial ownership will maintain the same
structure:
- the new share shall be booked to the original account: as such,
it will be divided in the same way as existing shares;
- fractional amounts will, however, be allocated to the bare
owner only.
Transactions will be centralized by BNP Paribas Securities
Services – Grands Moulins de Pantin, 9 Rue du Débarcadère, 93500
Pantin.
This free share allocation will be the subject of a detailed
Euronext release as of today.
DIVIDEND
Meeting on February 23, 2021, the Board of Directors proposed
the distribution of a dividend of €2.14 per share* in respect of
the 2020 financial year.
As a reminder, in February 2020, the dividend initially proposed
in respect of full-year 2019 was €2.26 per share. It was then
reduced by 33% to €1.43, given the effects of the COVID-19 pandemic
and in line with the recommendations of AFEP (Association Française
des Entreprises Privées) at the time.
The proposal to return to a more normative level in the dividend
is based on the satisfactory 2020 performances thanks to the
Consumer business’ rebound in the second half of the year, as well
as on the Board’s trust in the Group’s continued profitable growth
over the long term.
Shareholders having held shares under the registered form for
more than two years will receive a loyalty bonus of 10%, taking the
total dividend to €2.35 per share (for holdings below 0.5% of the
capital for a given shareholder).
The coupon detachment date is set for May 25 and the dividend
will be paid on May 27, 2021.
OUTLOOK
Following an atypical year, Groupe SEB is confirming its trust
in its business model, which once again demonstrated its resilience
and solidity in the face of a major crisis.
The general environment at the start of 2021 is highly
uncertain. Despite the initiation of vaccination campaigns, health
conditions continue to be unstable, reflected in movement
restriction measures in many countries, notably in Europe, and
ongoing difficulties in the hospitality and catering sectors, still
severely impacted.
However, as in the second half of 2020, our Consumer business
activity is solid at the beginning of the year on a favorable
comparison basis. The momentum is based on firm demand, new
products launchings supported by strong advertising and marketing
activation and stepped-up e-commerce. A gradual return to normal of
the Professional business could materialize as of the second half
of the year.
Given the limited visibility on the coming months and the
seasonal nature of our business, we are not in a position to
specify our objectives for full-year 2021 at this stage. The
currency effects as well as the high price levels of raw materials
and freight are currently headwinds. Nevertheless, the Group is
well equipped and firmly on track to return to organic sales growth
and higher Operating Result from Activity in 2021.
In any case, the Group remains entirely mobilized and agile,
ready to adapt its systems and processes to health requirements and
to any measures implemented by the public authorities in all of its
countries.
*After free allocation of 1 new share per 10 existing
Groupe SEB's consolidated and company financial statements at
December 31, 2020 were approved by the Board of Directors on
February 23, 2021.
CONSOLIDATED INCOME STATEMENT
(€ million)
31/12/2020
31/12/2019
31/12/2018
Revenue
6,940.0
7,353.9
6,812.2
Operating expenses
(6,334.6)
(6,614.1)
(6,117.4)
OPERATING RESULT FROM ACTIVITY
605.4
739.8
694.8
Statutory and discretionary
profit-sharing*
(24.2)
(37.2)
(33.6)
RECURRING OPERATING PROFIT
581.2
702.6
661.2
Other operating income and expense
(77.9)
(82.1)
(35.6)
OPERATING PROFIT
503.3
620.5
625.6
Finance costs
(39.8)
(41.1)
(32.8)
Other financial income and expense
(21)
(19.6)
0.9
Share of profits of associates
PROFIT BEFORE TAX
442.5
559.8
593.7
Income tax
(93.8)
(131.5)
(131.2)
PROFIT FOR THE PERIOD
348.7
428.3
462.5
Non-controlling interests
(48.2)
(48.6)
(43.5)
PROFIT ATTRIBUTABLE TO SEB S.A.
300.5
379.7
419.0
PROFIT ATTRIBUTABLE TO SEB S.A. PER
SHARE (in units)
Basic earnings per share
6.00
7.63
8.44
Diluted earnings per share
5.96
7.58
8.38
* including 2019 employee
share ownership plan expenses
CONSOLIDATED BALANCE SHEET
ASSETS (in €m)
31/12/2020
31/12/2019
31/12/2018
Goodwill
1,642.4
1,611.3
1,484.9
Other intangible assets
1,261.6
1,261.9
1,183.2
Property, plant and equipment
1,219.5
1,248.0
839.5
Investments in associates
-
-
-
Other investments
108.0
100.4
51.0
Other non-current financial assets
15.9
38.6
16.9
Deferred taxes
107.7
96.3
79.2
Other non-current assets
47.2
58.0
57.1
Long-term derivative instruments -
assets
17.9
3.4
2.5
NON-CURRENT ASSETS
4,420.2
4,417.9
3,714.3
Inventories
1,211.5
1,189.1
1,180.5
Trade receivables
965.4
1,159.7
1,087.2
Other receivables
160.6
175.1
144.7
Current tax assets
42.0
57.4
36.3
Short-term derivative instruments -
assets
36.2
20.5
40.1
Financial investments and other financial
assets
664.7
10.2
260.7
Cash and cash equivalents
1,769.4
785.5
612,7
CURRENT ASSETS
4,849.8
3,397.5
3,362.2
TOTAL ASSETS
9,270.0
7,815.4
7,076.5
LIABILITIES (in €m)
31/12/2020
31/12/2019
31/12/2018
Share capital
50.3
50.3
50.2
Reserves and retained earnings
2,436.8
2,395.1
2,130.2
Treasury stock
(19.6)
(52.8)
(82.4)
Equity attributable to owners of the
parent
2,467.5
2,392.6
2,098.0
Non-controlling interests
267.3
234.9
208.6
EQUITY
2,734.8
2,627.5
2,306.6
Deferred taxes
191.0
222.3
235.8
Employee benefit and other non-current
provisions
355.9
339.5
334.1
Long-term borrowings
2,285.8
2,301.8
1,857.9
Other non-current liabilities
52.0
55.2
45.8
Long-term derivative instruments -
liabilities
15.5
17.1
7.9
NON-CURRENT LIABILITIES
2,900.2
2,935.9
2,481.5
Employee benefit and other current
provisions
122.9
107.8
73.9
Trade payables
1,260.3
1,044.8
1,029.9
Other current liabilities
493.3
527.6
519.3
Current tax liabilities
35.9
74.1
52.6
Short-term derivative instruments -
liabilities
50.4
27.1
25.7
Short-term borrowings
1,672.2
470.6
587.0
CURRENT LIABILITIES
3,635.0
2,252.0
2,288.4
TOTAL EQUITY AND LIABILITIES
9,270.0
7,815.4
7,076.5
On a like-for-like basis (LFL) – Organic
The amounts and growth rates at constant exchange rates and
consolidation scope in a given year compared with the previous year
are calculated:
- using the average exchange rates of the previous year for the
period in consideration (year, half-year, quarter);
- on the basis of the scope of consolidation of the previous
year.
This calculation is made primarily for sales and Operating
Result from Activity.
Operating Result from Activity (ORfA)
Operating Result from Activity (ORfA) is Groupe SEB’s main
performance indicator. It corresponds to sales minus operating
costs, i.e. the cost of sales, innovation expenditure (R&D,
strategic marketing and design), advertising, operational marketing
as well as commercial and administrative costs. ORfA does not
include discretionary and nondiscretionary profit-sharing or other
non-recurring operating income and expense.
Adjusted EBITDA
Adjusted EBITDA is equal to Operating Result from Activity minus
discretionary and non-discretionary profit-sharing, to which are
added operating depreciation and amortization.
Free cash flow
Free cash flow corresponds to adjusted EBTIDA, after considering
changes in operating working capital, recurring capital
expenditures (CAPEX), taxes and financial expenses, and other
non-operating items.
Net indebtedness
This term refers to all recurring and non-recurring financial
debt minus cash and cash equivalents, as well as derivative
instruments linked to Group financing. It also includes financial
debt from application of the IFRS 16 standard “Leases” in addition
to short-term investments with no risk of a substantial change in
value but with maturities of over three months.
Loyalty program (LP)
These programs, led by distribution retailers, consist in
offering promotional offers on a product category to loyal
consumers who have made a series of purchases within a short period
of time. These promotional programs allow distributors to boost
footfall in their stores and our consumers to access our products
at preferential prices.
This press release may contain certain forward-looking
statements regarding Groupe SEB’s activity, results and financial
situation. These forecasts are based on assumptions which seem
reasonable at this stage, but which depend on external factors
including trends in commodity prices, exchange rates, the economic
environment, demand in the Group’s large markets and the impact of
new product launches by competitors.
As a result of these uncertainties, Groupe SEB cannot be held
liable for potential variance on its current forecasts, which
result from unexpected events or unforeseeable developments.
The factors which could considerably influence Groupe SEB’s
economic and financial result are presented in the Annual Financial
Report and Universal Registration Document filed with the Autorité
des Marchés Financiers, the French financial markets authority. The
balance sheet and income statement included in this press release
are excerpted from financial statements consolidated as of December
31, 2020, examined by SEB SA’s Statutory Auditors and approved by
the Group’s Board of Directors, dated February 23, 2021.
Conference with management on February 25 at
2:30 p.m. CET
Please click on the following link to
access the live webcast
The webcast will also be available at
www.groupeseb.com on February 25 as of 8:00 p.m. CET
Access (audio only):
From France: +33 (0) 1 7037 7166- Password: SEB
EN From other countries: +44 (0) 33 0551 0200- Password: SEB EN
Next key dates - 2021
April 22 | after market closes
Q1 2021 sales and financial data
May 20 | 3:00 pm (Paris time)
Annual General Meeting
July 23 | before market opens
H1 2021 sales and results
October 26 | after market closes
9-month 2021 sales and financial
data
Find us on www.groupeseb.com
World reference in small domestic equipment, Groupe SEB operates
with a unique portfolio of 30 top brands including Tefal, Seb,
Rowenta, Moulinex, Krups, Lagostina, All-Clad, WMF, Emsa, Supor,
marketed through multi-format retailing. Selling more than 360
million products a year, it deploys a long-term strategy focused on
innovation, international development, competitiveness and client
service. Present in over 150 countries, Groupe SEB generated sales
of €6.9 billion in 2020 and has more than 34,000 employees
worldwide.
SEB SA
SEB SA - N° RCS 300 349 636 RCS LYON – with
a share capital of €55,337,770 – Intracommunity VAT: FR
12300349636
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Investor/Analyst Relations
Groupe SEB Financial Communication and IR Dept
Isabelle Posth Raphaël Hoffstetter
comfin@groupeseb.com
Tel: + 33 (0) 4 72 18 16 04
Media Relations
Groupe SEB Corporate Communication Dept
Cathy Pianon Anissa Djaadi
com@groupeseb.com
Tél. + 33 (0) 6 33 13 02 00 Tél. + 33 (0) 6 88 20 90 88
Image Sept Caroline Simon Claire Doligez Isabelle Dunoyer de
Segonzac
caroline.simon@image7.fr
cdoligez@image7.fr
isegonzac@image7.fr
Phone: + 33 (0) 1 53 70 74 70
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