Refresco Gerber reports solid 2015 results and delivers on strategic goals

Transcription

1 Press release March 10, 2016 Refresco Gerber reports solid 2015 results and delivers on strategic goals Key indicators: Volume in full year 2015 increased 2.1% to 6,095.5 million liters (FY 2014: 5,968.9 million liters). Co-Packing volumes grew by 8.8% and amounts to 19.1% of total volumes. Gross profit margin per liter in euro cents amounted to 14.2 euro cents (FY 2014: 14.2 euro cents). Adjusted EBITDA increased 3.8% to million (FY 2014: million). Highlights: Revenue at 2,016.4 million in 2015 compared to 2,036.9 million in 2014, a decrease of 1%, due to passing more favourable input prices on to customers. On a reported basis net profit amounted to 41.8 million (FY 2014: 38.7 million). Net profit, adjusted for one-off items, amounted to 77.8 million compared to 46.7 million last year. Adjusted EPS amounted to 97.8 euro cents compared to euro cents in With a net debt of million at the end of December 2015, net debt ratio, based on adjusted EBITDA, amounted to 2.1. Refresco Gerber acquires the PepsiCo bottling facility in Hamburg, Germany, including 10 year co-packing agreement. Transaction is expected to close in Q Key figures: (x 1 million euro unless stated otherwise) un-audited audited Sales in liters (millions of liters) 1, , , ,968.9 Revenue , ,036.9 Gross profit margin per liter (euro cents) Adjusted EBITDA IPO related (and other one-time) costs (1.4) (3.8) (26.3) (13.6) Operating profit Adjusted operating profit Exceptional financing costs - - (21.9) - Net profit / (loss) Adjusted net profit / (loss) EPS (euro cents) pro forma Adjusted EPS 3 (euro cents) pro forma Net debt ratio (net debt/ltm adjusted EBITDA) CEO Hans Roelofs: Looking back on 2015 I am pleased to confirm that we have delivered in line with our outlook to grow volumes faster than the market. We additionally report a slightly better than foreseen gross profit margin per liter and end the year with a strong cash position. Revenue declined slightly due to the passing on of more favourable input prices to our customers, a dynamic that we have highlighted in previous quarters. On strategy, we took significant steps in pursuit of our goals. We successfully completed our IPO and refinancing while continuing to grow our business and maintain our margins. We continued investing in new bottling lines and new warehousing facilities, enhancing our manufacturing and supply chain capabilities, especially in the growth category of 1 EPS Q and FY 2014 on a pro-forma basis. 2 Adjusted EBITDA and adjusted net profit are not a measure of our financial performance under IFRS. We apply adjusted EBITDA and adjusted net profit to exclude the effects of certain exceptional charges that we believe are not indicative of our underlying operating performance. Such adjustments relate primarily to substantial one-off restructurings, costs relating to acquisitions or disposals, refinancing and IPO relating costs. 3 Adjusted EPS has been calculated based upon adjusted net profit, which excludes the costs related to the IPO, exceptional financing costs, restructuring costs and relating tax effect. The number of issued shares has been determined on 81.2 million for Q2,Q3 and Q For Q this number was determined on a pro forma basis of 74.3million shares. FY 2015 the number of shares was determined on a pro forma basis of 79.5 million. For all calculations in 2014 the number of shares has been determined on a pro forma basis of 74.3 million. Press release 1

2 Aseptic PET. Our efforts to grow Co-Packing relative to Private Label also paid off with an 8.8% increase over the full year. Finally, I was pleased to announce on February 24, 2016 our intention to acquire PepsiCo s bottling facility in Germany. This latest acquisition in our buy and build strategy includes a 10 year Co-Packing agreement which will accelerate our Co-Packing business in Germany and strengthen our customer portfolio in this important region. For 2016, we expect an organic volume growth compared to 2015 in the low to mid-single digits and gross profit margin per liter to be marginally lower compared to Group volume and revenue development Total volume for the quarter was 1,375.6 million liters compared with 1,387.1 million liters in Q Volumes in November and December partly offset the soft start in October On a full year basis, we recorded a volume of 6,095.5 million liters compared to 5,968.9 million liters in The increase in volume of 2.1% compared to last year was slightly ahead of the total soft drinks market growth in Western Europe 4 and Poland 4. Excluding Holding revenue, we generated million revenue in the fourth quarter compared to million in Q For the full year, total revenues, due to lower input prices which are passed on to our customers, decreased by 1% from 2,036.9 million in 2014 to 2,016.4 million in The average revenue per liter came down slightly in the year under review. Volume and revenue by location of sales In the fourth quarter of 2015 volumes in the Benelux, Germany and France were lower compared to the same period in the previous year, while volumes in Iberia, Italy, North East Europe and the UK increased on a quarter by quarter basis. Revenues in the quarter decreased in the Benelux, Germany and France while we reported an increase in revenues in Iberia, Italy, North East Europe and the UK. On a full year basis, Benelux reported a decline in volume compared to 2014 which is partly explained by the retail market conditions which remained challenging. In Germany and France volumes were slightly down compared to 2014 due to product mix effects, while in Italy and Iberia volumes strongly increased. In Italy volumes were driven by the roll out of new contract wins in Co-Packing, slightly offset by lower Private Label volumes. Volume growth in Iberia was primarily explained by a significant increase of Private Label volumes compared to last year. Both regions, Italy and Iberia, benefited in 2015 from improved economic conditions and the more favourable weather conditions compared to last year. North East Europe reported strong volume increase compared to 2014 as a result of favourable weather conditions and the related product mix. Volumes in the UK decreased in 2015 mainly due to a softening of the retail market. On the other hand, revenues in the UK increased compared to last year as a result of a more favourable product mix and positive currency effects. Volume (in million liters) Benelux , ,058.4 Germany , ,484.5 France Iberia Italy North East Europe UK Total volume 1, , , , Source: Initial Canadean Quarterly Beverage Trackers Press release 2

3 Revenue by location of sales (x1 million euro) un-audited audited Benelux Germany France Iberia Italy North East Europe UK Total revenue regions , ,008.9 Holding Total revenue , ,036.9 Development Co-Packing and Private Label volumes Co-Packing, the business channel consisting of the bottling activities for A-brand owners, increased by 3.2% compared to the fourth quarter in 2014 and increased significantly by 8.8% on a full year basis. As a result Co- Packing, as a percentage of total volumes, increased to 19.1% (2014: 17.9%). Our volumes in the Private Label channel, which comprises the bottling activities for retailers, decreased by 1.7% in the fourth quarter and increased marginally by 0.7% on a full year basis, compared to the respective periods last year. Refresco Gerber s strategy is to increase Co-Packing as a percentage of total volumes in the future. The developments in 2015 supported this increased focus on Co-Packing. Margin development Gross profit margin per liter for the fourth quarter of 2015 ended higher than expected amounting to 14.8 euro cents (Q4 2014: 14.9 euro cents). Gross profit margin for the full year was 14.2 euro cents (FY 2014: 14.2 euro cents). Although prices of raw materials started to increase in the third quarter of 2015, the gross margin per liter for the full year was slightly better than foreseen. Favourable purchasing conditions, currency impact and product mix effects were important drivers of this result. Results of operations Total operating costs for the quarter were million, which is 14.7 million lower than the same quarter last year (Q4 2014: million). On a full year basis, total operating costs amounted to million compared with million in The increase was driven by IPO related costs, higher start-up costs of new production lines - partly offset by a decrease in depreciation, amortization and impairment- currency effects and a one-off gain in employee benefits expenses. For the quarter, adjusted operating profit was 27.2 million compared to 24.5 million in the fourth quarter of Reported operating profit was 31.9 million (Q4 2014: 20.7 million). On a full year basis, adjusted operating profit was million compared to million in Reported operating profit in 2015 amounted to million (FY 2014: million). Reconciliation of operating profit to adjusted EBITDA Adjusted EBITDA in the fourth quarter of 2015 amounted to 47.8 million in line with the same period last year (Q4 2014: 48.3 million). Adjusted EBITDA for the full year 2015 totalled million, an increase of 3.8%, compared to million in Holding revenue relates to the sale of packaging and raw materials to the divested Waibstadt manufacturing site which has been concluded by the end of July Press release 3

4 (x1 million euro) un-audited audited Operating profit Depreciation, amortization and impairment costs EBITDA Merger and restructuring costs IPO related costs (0.3) Restructuring costs Refinancing related costs Pension plan amendment (6.9) - (6.9) - Sales of fixed assets - - (0.3) - Total one-off costs (4.7) Adjusted EBITDA Finance result As a result of the refinancing in June 2015 interest expenses decreased 66.7% to 4.0 million in the fourth quarter of 2015 compared to 12.1 million in the same quarter in For the full year 2015 total interest expenses amounted to 28.4 million in 2015 compared to 49.6 million in (x1 million euro) un-audited audited Q Q Q Q Interest expenses (4.0) (12.1) (28.4) (49.6) Refinancing costs - - (21.9) - Interest receivables Net finance result (4.0) (12.0) (49.9) (49.4) Reconciliation of net profit to adjusted net profit Reported net profit for the fourth quarter of 2015 amounted to 24.6 million compared to a reported net profit of 4.8 million in the same period last year. Adjusted net profit for the quarter was 18.8 million compared to 7.1 million in the fourth quarter of For the full year, reported net profit amounted to 41.8 million in 2015 compared to a reported net profit of 38.7 million in Adjusted net profit on a full year basis was 77.8 million in 2015 compared to an adjusted net profit of 46.7 million in The tax effect of 11.6 million relating to the one-offs includes a oneoff tax gain of 2.4 million. (x1 million euro unless stated otherwise) un-audited audited Net profit / (loss) Non-controlling interest - (0.4) 0.4 (0.1) Profit attributable to shareholders Result of discontinued business - (0.2) - (2.2) Restructuring costs IPO related costs (0.3) Refinancing related costs Pension plan amendment (6.9) - (6.9) - Merger and acquisition costs Sales of fixed assets - - (0.3) - Impairment assets Tax effect (2.1) (0.9) (11.6) (3.3) Total one-off costs (5.8) Adjusted net profit / (loss) Press release 4

5 un-audited audited Pro forma no. of shares (x1 million) EPS (euro cents) pro forma Adjusted EPS profit/ (loss) pro forma (euro cents) Balance sheet and financial position Balance sheet total amounted to 1,641.1 million at the end of December 2015 compared to 1,643.1 million at yearend In June 2015 Refresco Gerber fully completed the refinancing of its existing Senior Secured Notes. A new (unsecured) term loan of million which will mature in April 2020 was arranged through an international bank syndicate. The syndicate loan agreement includes an undrawn Revolving Credit Facility of up to 150 million to finance general corporate purposes, including capital expenditure investments and acquisitions, and working capital purposes. The Company s total annual interest costs decreased significantly on an annual basis. The refinancing provides sufficient headroom for Refresco Gerber to execute its growth strategy of providing a high quality bottling platform to meet customer needs in each of the countries they operate and to have a pro-active approach towards consolidation. At year-end 2015, net debt amounted to million consisting of million in loans and borrowings and 95.7 million cash and cash equivalents, compared to a net debt of million at December 31, At December 31, 2015, net debt ratio, based on LTM adjusted EBITDA, amounted to 2.1 compared to a ratio of 2.8 at the end of December Capex spending for the fourth quarter was 29.0 million compared to 43.8 million in the same period last year. On a full year basis capex spending was 80.8 million in 2015 ( million), which is mainly attributable to investments in a new warehouse facility in Grünsfeld (Germany) and new bottling lines across the business to optimize our manufacturing capabilities. Working capital improved in the fourth quarter of 2015 to 43.1 million (Q4 2014: 55.8 million). Acquisition Refresco Gerber announced on February 24, 2016 that it has entered into an agreement to acquire the PepsiCo bottling facility in Hamburg, Germany. This transaction confirms our focus on expanding our co-packing business and fits Refresco Gerber s buy & build strategy, while further strengthening our footprint in the German soft drinks and fruit juices market. Included in the terms of agreement is a 10-year co-packing agreement with PepsiCo. The acquisition is subject to approval of German competition authority and it is anticipated that the acquisition will be completed during the second quarter of The parties have agreed not to announce the purchase price involved. Outlook We expect an organic volume growth for 2016 of low to mid-single digit levels compared to the full year 2015 volume (FY 2015: 6.1 billion liters). Due to slightly increasing input costs and product mix effects, we expect gross profit margin per liter for 2016 to come down marginally compared to the gross profit margin per liter over 2015 (14.2 euro cents). Dividend proposal The company applies a dividend policy that aims to pay out 35% to 50% of its annual adjusted net income 6. A proposal will be submitted to the General Meeting of Shareholders to declare a distribution of 0.34 per common share, in cash. Further details will be given in the agenda for the General Meeting of Shareholders, to be held on May 12, Supervisory board Following the recent reduction of Ferskur Holding 1 B.V. s (Stodir) shareholding in Refresco Gerber and in accordance with the Relationship Agreement, one of the two Ferskur Holding 1 B.V. nominated Supervisory Board members, Hilmar Thor Kristinsson, will resign at the end of Refresco Gerber s next Annual General Meeting of Shareholders, to be held on May 12, Refresco Gerber will propose to appoint Mrs. Inge Plochaet as a new member of its Supervisory Board at its next Annual General Meeting. Mrs. Inge Plochaet has over 25 years of experience in the beverages and FMCG sector having held various international senior management and director positions with AB Inbev. Further details will be included in the documentation for the Annual General Meeting, to be published on Refresco Gerber s website on March 31, Adjusted net income is defined as net profit excluding other exceptional costs/income and related tax effect. Press release 5

6 Analyst meeting and conference call Today, at 10:00 am CET, Refresco Gerber will host an analyst meeting to discuss the fourth quarter and full year 2015 results. The meeting will be held at Hilton, Apollolaan 138, Amsterdam. Members of the investment community can join the conference call at +31(0) (NL) or +44(0) (UK) using the conference ID (for all countries). The call will be audio cast live via the company s website: A replay of the presentation and Q&A will be available on our website by the end of the day. For further information, please contact: Marieke Palstra, telephone +31(0) marieke.palstra@refrescogerber.com Financial calendar 12 May 2016 Publication of first quarter results May 2016 Annual General Meeting of Shareholders About Refresco Gerber N.V. Refresco Gerber (Euronext: RFRG) is the leading European bottler of soft drinks and fruit juices for retailers and branded players with production in the Benelux, France, Germany, Spain, Italy, the UK, Poland and Finland. The company realized in 2015 full year volumes and revenue of circa 6.1 billion liters and circa 2.0 billion, respectively. Refresco Gerber offers an extensive range of product and packaging combinations from 100% fruit juices to carbonated soft drinks and mineral waters in carton, PET, Aseptic PET, cans and glass. Focused on innovation, Refresco Gerber continuously searches for new and alternative ways to improve the quality of its product and packaging combinations in line with consumer and customer demand, environmental responsibilities and market demand. Refresco Gerber is headquartered in Rotterdam, the Netherlands and employs circa 4,100 staff. Press release 6

7 The Tables section: Consolidated income statement Consolidated balance sheet Consolidated cash flow statement Press release 7

8 CONSOLIDATED INCOME STATEMENT Refresco Gerber NV (x 1 million euro unless stated otherwise) un-audited audited Revenue , ,036.9 Other income (0.1) (0.1) Raw materials and consumables used (267.4) (291.3) (1,148.3) (1,186.5) Gross Profit Margin Gross Profit Margin % 43.1% 41.5% 43.1% 41.7% Gross Profit Margin per liter (euro cents) Employee benefits expenses (48.0) (56.2) (221.7) (226.8) Depreciation, amortization and impairment costs (20.6) (23.8) (84.5) (87.8) Other operating expenses (102.6) (105.9) (451.9) (429.0) Operating costs (171.2) (185.9) (758.1) (743.6) Operating profit / (loss) Finance income Finance expense (4.0) (12.1) (50.3) (49.6) Net finance result (4.0) (12.0) (49.9) (49.4) Profit / (loss) before income tax Income tax (expense) / benefit (3.3) (4.1) (18.8) (20.9) Result discontinued operations Profit / (loss) Profit attributable to: Owners of the company Non-controlling interest (0.4) 0.1 Profit / (loss) Press release 8

9 CONSOLIDATED BALANCE SHEET Refresco Gerber NV (x 1 million euro) Audited December December ASSETS Non-current assets Property, plant & equipment Intangible assets Financial fixed assets Deferred tax Total non-current assets Current assets Inventories Derivative financial instruments Current income tax receivable Other current assets Cash and cash equivalents Total current assets Asset classified as held for sale Total assets 1, ,643.1 EQUITY & LIABILITIES Equity Share capital Share premium Reserves (71.1) (126.7) Profit / (loss) for the period Total Non-controlling interest Total equity Non-current liabilities Loans and borrowings Derivatives Provisions and deferred tax Total non-current liabilities Current liabilities Loans and borrowings Derivate financial instruments Trade and other payables Current income tax liabilities Provisions Total current liabilities Total equity and liabilities 1, ,634.1 Press release 9

10 CONSOLIDATED CASH FLOW STATEMENT Refresco Gerber NV (x 1 million euro) un-audited audited Cash flows from operating activities Profit / (loss) after tax including discontinued operations Adjustments for: Amortisation, depreciation and impairments Net change in fair value derivative financial instruments recognized in profit and loss and premiums paid - (0.4) 1.4 (4.1) Net finance costs (Gain) / loss on sale of property, plant and equipment and other investments (0.3) (0.7) Income tax expense / (benefit) Movements in provisions pensions and other provisions 6.1 (7.7) (0.1) (5.1) Pension plan amendment (8.0) - (8.0) - Cash flows from operating activities before changes in working capital and provisions Change in: Inventories (1.5) 15.7 (15.4) 14.9 Trade and other receivables (28.3) Trade and other payables (8.8) (37.4) (10.9) 41.5 Total change in working capital (9.0) (3.5) Interest received Interest paid (12.6) (17.5) (34.3) (48.1) Early repayment fee - - (13.3) - Income taxes paid (4.5) (2.4) (23.0) (11.0) Net cash generated from operating activities Cash flows from investing and acquisition activities Proceeds from sale of property, plant and equipment Purchase of property, plant and equipment (33.5) (20.1) (84.2) (59.1) Purchase of intangible assets (1.0) (0.6) (2.0) (0.9) Purchase / sale of other investments 0.1 (0.1) Net cash used in investing and acquisition activities (34.4) (20.5) (81.0) (38.6) Cash flows from financing activities Proceeds from loans and borrowings Repayment of loans and borrowings 4.7 (4.1) (665.5) (106.3) Proceeds of new issued shares Cost of new issued shares - - (3.9) - Net cash (used in) / from financing activities 4.7 (4.1) (50.3) (106.3) Translation adjustment (0.2) Movement in cash and cash equivalents (3.3) (10.9) (0.9) 11.0 Cash and cash equivalents at beginning Cash and cash equivalents at end Movement in cash and cash equivalents (3.3) (10.9) (0.9) 11.0 Press release 10