Albéa Beauty Holdings S.A.

Transcription

1 Condensed unaudited interim consolidated financial statements for the periods ended September 30, 2015 and September 30, 2014

2 CONSOLIDATED INCOME STATEMENTS Third quarter Nine Month Period Continuing operations: ended September 30, ended September 30, ended September 30, ended September 30, Note Revenue Cost of sales 5.2 ( ) ( ) ( ) ( ) Gross profit Selling and administrative expenses 5.3 (40 444) (46 191) ( ) ( ) Restructuring and project costs 5.4 (5 160) (7 072) (13 415) (20 737) Impairment charges (11) (108) 56 (85) Other income / (expense) 5.5 (5 766) (4 190) (12 974) (11 641) Operating profit Financial income Financial expense (16 714) (47 510) (87 623) (96 470) Financial result 5.6 (12 875) (47 510) (82 059) (96 258) - - Share of profit of associates Profit (loss) from continuing operations before income taxes (505) (33 934) (40 164) (49 312) Income tax expense (4 452) 697 (11 726) (5 703) Profit (loss) from continuing operations (4 957) (33 237) (51 890) (55 015) - - Loss for the period (4 957) (33 237) (51 890) (55 015) - - Attributable to: - - Owners of the parent (4 957) (33 238) (51 890) (55 018) Non-controlling interests Basic and diluted earnings per share (in USD) 5.7 (17,44) (116,96) (182,61) (193,61) The notes are an integral part of these condensed interim consolidated financial statements 1

3 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Loss for the period (51 890) (55 015) Other comprehensive income: Items that will not be reclassified to profit or loss Actuarial gains/(losses) on post-employment benefit plans (10 434) Tax effects (584) Items that will not be reclassified to profit or loss (9 180) Items that may be reclassified to profit or loss Net change in foreign currency translation adjustments Items that may be reclassified to profit or loss Total other comprehensive income for the period, net of tax Total comprehensive income for the period (29 963) (26 251) Attributable to: i) Owners of the parent (29 963) (26 255) ii) Non-controlling interests - 4 The notes are an integral part of these condensed interim consolidated financial statements. 2

4 CONSOLIDATED BALANCE SHEETS - ASSETS At September 30, At December 31, Note Non-current assets Goodwill Intangible assets Property, plant and equipment Deferred tax assets Investments in associates Other financial assets Total non-current assets Current assets Inventories Trade and other receivables Cash and cash equivalents Assets held for sale Total current assets Total assets The notes are an integral part of these condensed interim consolidated financial statements. 3

5 CONSOLIDATED BALANCE SHEETS - EQUITY AND LIABILITIES At September 30, At December 31, Note Equity Capital stock Additional paid-in capital Retained earnings and other components of equity (59 885) (7 995) Other comprehensive income (6 798) Equity excluding non-controlling interests (29 406) Non-controlling interests - - Total equity (29 406) Non-current liabilities Borrowings Deferred tax liabilities Pensions and other post-employment benefit obligations Other long-term employee benefit obligations Termination benefits Non-current provisions Other non-current financial liabilities Total non-current liabilities Current liabilities Borrowings Other current financial liabilities Trade and other payables Income taxes payable Current provisions Total current liabilities Total liabilities Total equity and liabilities The notes are an integral part of these condensed interim consolidated financial statements. 4

6 CONSOLIDATED STATEMENTS OF CASH FLOWS Third quarter Nine month Period Loss for the period (4 957) (33 237) (51 890) (55 015) Adjustments for : Share of profit of associates (73) (235) (425) (454) Income tax expense recognized in profit or loss (697) Net finance costs Depreciation and amortization Use of government grant (1) 11 (2 400) (1 593) (6 649) Net (gain)/loss on disposal of assets 92 (43) Movements in working capital (2) (6 431) (21 562) Movements in working capital - inventories (13) (10 592) Movements in working capital - receivables (13 596) (18 926) Movements in working capital - payables (11 305) (30 495) Change in provisions (404) (8 370) Income taxes paid (5 623) (4 015) (8 145) (11 819) Cash flow from operating activities Acquisitions of assets (15 448) (19 883) (45 484) (69 413) Loans (advances)/repayments (3) (47) 367 (94) Disposal of assets Acquisition of subsidiary, net of cash acquired (78) 1 (93) 261 Dividend received from associates Other Cash flow used in investing activities (14 943) (4 045) (44 708) (48 158) Cash flow from operating and investing activities Loans issued (4) (2 821) Factoring (8 586) (7 449) (34 334) Repayment of loans (3 202) (5 398) (14 685) (13 441) Interest paid (2 122) (2 060) (30 993) (33 382) PECS redemption (classified in Equity) 70 - (864) (479) Cash flow from (used in) financing activities (16 661) (10 356) (20 644) (18 250) Net increase / (decrease) in cash and cash equivalents (11 202) (9 590) Cash and cash equivalents at beginning of the period Exchange gains/(losses) (1 645) (2 541) (4 739) (2 643) Cash and cash equivalents at end of the period (1) Use of government grant is related to the Chinese government grant and reflects the portion recorded through the income statement as an income to offset expenses incurred during the period. This non-cash income is excluded from the cash flows from operating activities. (2) Movement in working capital is positively impacted by working capital initiatives (see note 6.8) (3) At end of September 2014 : Albéa received a lump sum of USD 4,6 million in cash as a total payment for all amounts that remained due by Rose HPC Bidco L.L.C. (4) September 2015 : On February 11, 2015, Albéa issued a fungible add-on to the existing bond in one tranche of euros 45 million maturing on November 1, 2019) (see note 3) The notes are an integral part of the condensed interim consolidated financial statements. 5

7 CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) Free cash flow vs Cash flow from operating and investing activities Third quarter Nine month Period Period ended September 30, Period ended September 30, Cash flow from operating and investing activities Finance lease additions (991) (6 571) Interest paid (2 122) (30 993) Other (974) (3 750) Free cash Flow The line other includes mainly realized forex losses for USD 1.7 million and PEC redemption for USD 0.9 million. 6

8 CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Attributable to owners of the parent Capital stock Additional paid-in capital Retained earnings Unrealized Cumulative gains translation (losses) adjustments Total Non controlling interest Total equity At December 31, (5 032) (36 365) Loss for the period - - (70 541) - - (70 541) 4 (70 537) Other comprehensive income (11 754) Total comprehensive income - - (70 541) (11 754) (35 786) 4 (35 782) Proceeds from shares issued PECS redemption - (948) (948) - (948) Acquisition of NCI in Albéa Packaging Zhongshan Co Ltd - - (262) - (156) (418) (76) (494) Other At December 31, (7 995) (16 786) Loss for the period - - (51 890) - - (51 890) - (51 890) Other comprehensive income Total comprehensive income - - (51 890) (29 963) - (29 963) PECS redemption - (864) (864) - (864) At September 30, (59 885) (12 395) (29 406) - (29 406) The notes are an integral part of the condensed interim consolidated financial statements. In nine month period ended September 30, 2015, Preferred Equity Certificate were redeemed for USD 1.7 million (impact of USD 0.91 million in Borrowings and USD 0.86 million in Equity). 7

9 Notes to the condensed interim consolidated financial statements Condensed interim consolidated financial statements Consolidated Balance Sheet Consolidated income statements Note 6 Notes to the balance sheet Consolidated statements of comprehensive income Note 6.1 Goodwill Consolidated balance sheets - assets Note 6.2 Intangible assets and Property, plant Consolidated balance sheets - equity and liabilities and equipment Consolidated statements of cash flows Note 6.3 Other financial assets Consolidated statements of changes in equity Note 6.4 Inventories Note 6.5 Trade and other receivables Note 6.6 Cash and cash equivalents General information Note 6.7 Capital stock Note 6.8 Borrowings Note 1 General information Note 6.9 Pensions and other LT benefits obligations Note 2 Accounting policies Note 6.10 Provisions Note 3 Other information Note 6.11 Other financial liabilities Note 4 Segment reporting Note 6.12 Trade and other payables Note 6.13 Assets held for sales Consolidated Income Statement Additional disclosures Note 5 Notes to the income statement Note 7 Related parties Note 5.1 Revenue Note 8 Subsequent events Note 5.2 Note 5.3 Note 5.4 Note 5.5 Note 5.6 Note 5.7 Cost of sales Selling and administrative expenses Restructuring and project costs Other income/(expense) Net finance costs Earnings per share 8

10 NOTE 1 GENERAL INFORMATION 1.1. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS These notes are an integral part of the condensed interim consolidated financial statements for the nine-month periods ended September 30, 2015 and September 30, GENERAL INFORMATION Albéa Beauty Holdings S.A. (the Company ) is domiciled in Luxembourg and registered in the Luxembourg Trade and Companies Registry (Registre du Commerce et des Sociétés de Luxembourg) under number B and is an affiliate of Sun Capital Partners V LP. The Company and the subsidiaries included in the scope of consolidation constitute Albéa Group ( Albéa ). The Group was created by Sun Capital after the acquisition of the Beauty Packaging business from Rio Tinto Alcan on July 2, The Group was created by Sun Capital after the acquisition of the Beauty Packaging business from Rio Tinto Alcan on July 2, On December 31, 2012, Albéa completed the acquisition 100% of Rexam Personal Care, a leading producer of dispensing systems and make-up packaging for the Cosmetics and Personal Care markets. Albéa Beauty Holdings S.A., the bond issuer, is held by Albéa S.A. via another holding company. These three entities except financing and holding activities did not carry out any operating activities in the period ended September 30, Albéa is one of the world s leading producers of plastic packaging products for the beauty and cosmetics industry, providing a wide range of solutions for the make-up, fragrance, skincare, personal and oral care markets. The operational headquarters of Albéa are located in Gennevilliers, France. Albéa employs about people and operates 38 manufacturing facilities in 14 different countries across Europe, the Americas and Asia. The consolidated financial statements are presented in thousands of US dollars and all values are rounded to the nearest thousand ( 000) except where otherwise indicated. 9

11 NOTE 2 ACCOUNTING POLICIES The accounting policies and practices applied are the same as those applied for the consolidated financial statements for the year ended December 31, STATEMENT OF COMPLIANCE Albéa s condensed interim consolidated financial statements are prepared in accordance with IAS 34 Interim Financial Reporting. They do not contain all the disclosures required for annual consolidated financial statements and should therefore be read in conjunction with the Group s annual consolidated financial statements for the year ended December 31, 2014, prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted for use in the European Union BASIS OF PREPARATION General principle The preparation of condensed interim financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying Albéa s accounting policies. The areas involving a higher degree of judgment or complexity or areas where assumptions and estimates are significant to the condensed interim consolidated financial statements are disclosed in Note The condensed interim consolidated financial statements have been prepared under the historical cost convention as modified by revaluation at fair value of the underlying assets and liabilities of acquired subsidiaries at the date when the control was achieved New standards, interpretations and amendments that may be applied early for financial years beginning on or after January 1, 2015 Amendments to IAS 1- Disclosure Initiative Amendments to IFRS 10, IFRS 12 and IAS 28 Investment Entities : applying the Consolidation Exception Amendments to IFRS 11 Accounting for Acquisitions of Interest in Joint Operations Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortization The Group is currently conducting analysis on the practical consequences of these new regulations and the effects of their implementation on the financial statements. 10

12 2.2. BASIS OF PREPARATION (CONTINUED) Standards, interpretations and amendments that may be applied early for financial years beginning on or after January 1, 2015 IFRS 9 Financial instruments; 1-2 Change in scope of consolidation IFRS 14 Regulatory Deferral Accounts IFRS 15 Revenue from Contracts with Customers Amendments to IAS 27 - Consolidated and Separate financial statements Accounting estimates and judgments The preparation of condensed interim consolidated financial statements requires management to exercise its judgment and make estimates and assumptions. These estimates and underlying assumptions are based on past experience and other factors considered reasonable under the circumstances. They serve as the basis for any judgment required for determining the carrying amounts of assets and liabilities when such amounts cannot be obtained directly from other sources. Actual amounts may differ from these estimates. The main sources of uncertainty relating to estimates used to prepare the condensed interim consolidated financial statements were the same as those described in the full year annual consolidated financial statements for the year ended December 31, 2014, with the exception of changes in estimates that are required in determining the provision for income taxes. 11

13 2.2. BASIS OF PREPARATION (CONTINUED) Specific items concerning the preparation of interim financial statements For the purposes of preparing the Group s condensed interim consolidated financial statements, the following calculations and estimates are applied in addition to the recognition, measurement and presentation rules described in Note The current and deferred tax expense for the period is calculated by applying the estimated average annual tax rate for the current fiscal year to pre-tax income for the first six months of the year. The estimate average annual tax rate results from taxes on income accrued at the level of each entity of the group, using the tax rate that would be applicable to expected total annual profit or loss. - Expenses relating to pensions and other post-employment benefit obligations are estimated based on the prorata amount expected for the full year, except where specific events (such as a significant change in the discount rate) occur having a material impact on the consolidated financial statements, in which case adjustments are made. During the six-month period ended September 30, 2015, the discount rate increased from 1.55% to 2.08% with an negative impact of USD 5 million in other comprehensive income and USD 0.3 million in profit and loss for Germany and France Seasonality The Group s performance is not affected by significant cyclical factors. 12

14 NOTE 3 OTHER INFORMATION TAP ISSUE On February 11, 2015, Albéa issued a fungible add-on to the existing bond in one tranche of euros 45 million maturing on November 1, 2019 (same guarantors and security as for the initial issuance). 13

15 NOTE 4 SEGMENT REPORTING As described below, Albéa has two operating segments, and reports the corporate costs not allocated to either of these two segments in the Corporate category: Tubes: laminate and plastic tubes for the oral care and cosmetics industry and dispensing system for Tubes Cosmetic Rigid Plastic (CRP): skincare caps, lipstick, compacts, mascara, trading activities and dispending system for Fragrance and cosmetic Corporate: Holding & Corporate costs not allocated to the two operating segments Albéa also presents data based on three geographical market, consisting of its three main geographic markets: Europe, Americas (of which North America - includes US and Mexican activities - and South America) and Asian countries (of which China and South Asia). The Adjusted EBITDA is defined as operating profit before depreciation & amortization, restructuring costs and severance costs, non-recurring fees, shareholders management fees, separation costs from Rexam, acquisitions and integration costs, other compensation and termination benefits, unrealized foreign exchange gains [losses], gains [losses] on disposals, impairment, bargain purchase gain. Operating segments are reported in a manner which is consistent with the internal reporting provided to Chief Operating Decision Maker. The Chief Operating Decision Maker, who is responsible for allocating resources and assessing the performance of the operating segments, has been identified as the executive committee that assess performance and allocates resources. 14

16 ADJUSTED EBITDA BRIDGE Third Quarter Nine-month Period Operating Profit Depreciation/amortization Restructuring & project costs Others Adjusted EBITDA The detail of the others is the following : Third Quarter Nine-month Period SUN management fees Impairment (56) 85 Gains (losses) on disposals 92 (32) Unrealized foreign exchange gains (losses) on working capital (378) (382) Inventory step-up release (purchase price allocation) Other Others

17 4.1. SEGMENT REPORTING As at September 30, 2015 Third Quarter 2015 Nine month period TUBES CRP Corporate Consolidated TUBES CRP Corporate Consolidated Segment revenue Adjusted EBITDA Depreciation/amortization (6 334) (13 021) (537) (19 892) (19 329) (38 532) (1 700) (59 561) Restructuring and projects costs (606) (305) (4 250) (5 161) (1 685) (4 974) (6 756) (13 415) Others (1) (2 534) (3 644) (3 296) (7 221) (5 607) (4 268) Operating Profit (3 525) (2 841) Segment assets (2) Capital expenditure of the period (6 998) (8 247) (202) (15 447) (20 262) (24 833) (389) (45 484) (1) See Adjusted EBITDA Bridge. The Other for the corporate includes mainly management fees recharged to the other segments. (2) Segment assets are reconciled with the balance sheet as follows : At September 30, 2015 TUBES CRP Corporate Consolidated Non current assets (*) Inventories, net WC - Receivables WC - Payables ( ) ( ) (17 770) ( ) Segment assets (*) Intangibles & tangibles assets, net and goodwill 16

18 4.1. SEGMENT REPORTING (CONTINUED) As at September 30, 2014 Third Quarter 2014 Nine month period 2014 TUBES CRP Corporate Consolidated TUBES CRP Corporate Consolidated Segment revenue Adjusted EBITDA (519) (7 534) Depreciation/amortization (6 902) (12 535) (464) (19 901) (20 384) (35 286) (1 662) (57 332) Restructuring and projects costs (1 072) (3 566) (2 434) (7 072) (2 275) (11 360) (7 102) (20 737) Others (1) (1 314) (3 529) (1 573) (3 263) (9 951) (3 357) Operating Profit (147) (6 441) Capital expenditure of the period (5 651) (18 428) (19 883) (24 790) (42 422) (2 201) (69 413) (1) See Adjusted EBITDA Bridge. The Other for the corporate includes mainly management fees recharged to the other segments. (2) Segment assets are reconciled with the balance sheet as follows: At December 31, 2014 TUBES CRP Corporate Consolidated Non current assets (*) Inventories, net (2 978) WC - Receivables (2 646) WC - Payables ( ) ( ) (19 425) ( ) Segment assets (2 772) (*) Intangibles & tangibles assets, net and goodwill 17

19 4.2. GEOGRAPHICAL INFORMATION As at September 30, 2015 Third Quarter 2015 Nine month period Europe America Asia Corporate Consolidated Europe America Asia Corporate Consolidated Revenue (1) (1) Adjusted EBITDA (1 621) (2 946) Depreciation/amortization (7 633) (5 458) (3 244) (3 557) (19 892) (23 148) (16 419) (9 233) (10 761) (59 561) Restructuring and projects costs (772) 27 (167) (4 249) (5 161) (3 871) (618) (2 170) (6 756) (13 415) Others (1) (1 589) (2 726) (1 863) (3 297) (3 627) (4 898) (4 303) (4 269) Operating Profit (6 546) (11 904) Geographical assets (2) Capital expenditure of the period (5 471) (6 142) (3 631) (203) (15 447) (20 124) (16 606) (8 365) (389) (45 484) Of which : Third Quarter 2015 Nine month period America SALES Adjusted EBITDA SALES Adjusted EBITDA North America South America Total America Asia SALES Adjusted EBITDA SALES Adjusted EBITDA China South Asia Total Asia (1) See Adjusted EBITDA Bridge. (2) Geographical assets are reconciled with the balance sheet as follows: At September 30, 2015 Europe America Asia Corporate Consolidated Non current assets (*) Inventories, net WC - Receivables WC - Payables ( ) (85 117) (47 098) (17 771) ( ) Geographical assets (*) Intangibles & tangibles assets, net and goodwill 18

20 4.2. GEOGRAPHICAL INFORMATION (CONTINUED) As at September 30, 2014 Third Quarter 2014 Nine month 2014 Europe America Asia Corporate Consolidated Europe America Asia Corporate Consolidated Revenue Adjusted EBITDA (519) (7 535) Depreciation/amortization (9 443) (5 143) (1 829) (3 486) (19 901) (25 184) (15 977) (5 447) (10 724) (57 332) Restructuring and projects costs (3 464) (774) (402) (2 432) (7 072) (8 206) (2 740) (2 691) (7 100) (20 737) Others (1) (991) (2 734) (1 118) (1 573) (1 958) (4 913) (4 416) (3 357) Operating Profit (3 167) (17 429) Capital expenditure of the period (8 587) (5 726) (9 766) (19 883) (32 791) (19 589) (14 832) (2 201) (69 413) Of which : Third Quarter 2014 Nine month 2014 America SALES Adjusted EBITDA SALES Adjusted EBITDA North America South America Total America Asia SALES Adjusted EBITDA SALES Adjusted EBITDA China South Asia Total Asia (1) See Adjusted EBITDA Bridge. (2) Geographical assets are reconciled with the balance sheet as follows: (*) Intangibles & tangibles assets, net and goodwill 19

21 NOTE 5 NOTES TO THE INCOME STATEMENT 5.1. REVENUE Revenue represents sales of goods deriving from Albéa s main activities, net of value added tax (VAT). The breakdown of revenue by segment and by geography is presented in Note COST OF SALES Third quarter Nine Month Period Employee benefit expenses - COGS (72 500) (82 214) ( ) ( ) Depreciation production assets - COGS (15 412) (15 281) (45 706) (43 678) Other expenses ( ) ( ) ( ) ( ) Total cost of sales ( ) ( ) ( ) ( ) Other expenses can be broken down as follows: Third quarter Nine Month Period Raw materials and components (resins, film, inks, purchase for resale, etc.) ( ) ( ) ( ) ( ) Other production consumables, energy and utilities (12 913) (15 014) (38 926) (44 811) Freight out costs (7 466) (8 016) (22 375) (25 670) Other costs (repairs, maintenance, services, etc.) (38 846) (42 374) ( ) ( ) Total other expenses (from Costs of sales) ( ) ( ) ( ) ( ) 20

22 5.3 SELLING AND ADMINISTRATIVE EXPENSES Third quarter Nine Month Period Employee benefit expenses - SAE (26 374) (27 346) (78 093) (88 730) Depreciation and amortization - SAE (1 274) (1 291) (3 911) (3 880) Other expenses - SAE (12 796) (17 554) (41 184) (54 873) Total selling and administrative expenses (40 444) (46 191) ( ) ( ) Other expenses for the period ended September 30, 2015 include mainly : - External costs (mainly operational consulting and advisory fees): IT costs (USD 6.5 million), Finance USD (5.2 million) and Human Resources (USD 3.4 million) - Selling cost for USD (5.2 million) - Rental costs for USD (2.7 million) 5.4. RESTRUCTURING AND PROJECT COSTS Third Quarter Nine Month Period Allowances / reversal of Restructuring provisions (non cash) (272) (1 438) (1 795) (2 902) Other costs for the year - Restructuring (4 888) (5 634) (11 620) (17 835) Total restructuring and project costs (5 160) (7 072) (13 415) (20 737) For the period ended September 30, 2015, the main components of restructuring and projects net costs were as follows: - USD (5.5) million, severance costs - USD (3.3) million, non-recurring and non-core business fees - USD (4.6) million, other cost linked to non-recurring projects At 30 September 2014, the main components of restructuring and projects net costs are as follows: - USD (5.7) million, project costs linked to footprint optimization - USD (3.2) million, severance costs - USD (4.2) million, integration/separation costs from Rexam - USD (4.1) million, capital structure change costs (mainly fees) - USD (3.5) million, other non-operational costs 21

23 5.5. OTHER INCOME (EXPENSE) Third quarter Nine Month Period Sun management fees (1 061) (1 028) (3 178) (2 887) Intangible assets depreciation (*) (3 094) (3 094) (9 283) (9 283) Gains (losses) on disposals (92) 32 (1 415) (605) Unrealized forex gains (losses) on working capital (2 078) (339) Other - OIE Total other income/(expense) (5 766) (4 190) (12 974) (11 641) (*) See note 3.1 in the Group s annual consolidated financial statements for the year ended December 31,

24 5.6. NET FINANCE COSTS Third quarter Nine Month Period Breakdown of Financial result Cost of net debt (15 808) (47 124) (85 669) (83 200) Interest costs on net debt (15 710) (15 928) (47 418) (46 890) Amortized costs (786) (776) (2 659) (2 271) Realized foreign exchange losses on net debt (675) 387 (1 754) (1 939) Unrealized foreign exchange losses on net debt (30 807) (33 838) (32 100) Other financial expense (906) (386) (1 954) (13 270) Impairment of the loan granted to Rose HPC Bidco LLC (10 772) Interest costs on pensions (407) (624) (1 290) (2 086) Actuarial losses on other benefit obligations (448) Other financial expense (499) 238 (664) 36 Financial expense (16 714) (47 510) (87 623) (96 470) Other financial income Actuarial gains on other benefit obligations Unrealized foreign exchange gains on net debt Other financial income Financial income Net finance costs (12 875) (47 510) (82 059) (96 258) Interest costs on net debt are mainly due to the Bonds USD 41.7 million. The unrealized foreign exchange losses on the net debt as at 30 September 2015 are also linked to the Bonds (USD 28.5 million) and losses on Brazilian borrowing for a total of USD 33.8 million. This is a non-cash item linked to the translation of USD bonds held by a subsidiary whose functional and reporting currency is euro. Other financial income at the end of September USD 5,2 million is mainly due to non-cash hedge fair value variation for USD 4.1 million on Brazilian swap on borrowing. This income is compensated by unrealized foreign exchange losses on net debt EARNINGS PER SHARE Third quarter Nine Month Period Number of shares: Weighted average number of ordinary shares in issue Net profit: Net profit attribuable to owners of the group (in thousands of USD) (4 957) (33 238) (51 890) (55 015) Basic and diluted earnings per share (in USD) (17,44) (116,97) (182,61) (193,61) 23

25 NOTE 6 NOTES TO THE BALANCE SHEET 6.1. GOODWILL At September 30, At December 31, Betts (1) Rexam PC (2) Goodwill (1) The change in the Betts goodwill amount is entirely due to an exchange rate variation 6.2. INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT Intangible assets Land Buildings Machinery and Equipment Other Construction tangible in progress assets Property, Plant and Equipment At December 31, Additions under finance lease Other additions Disposals and write-offs 5 (10) (50) (2 226) (39) 387 (1 938) Depreciation and amortization (10 967) (425) (8 560) (37 256) (1 764) 73 (47 932) Impairment charges Transfers in(out) from contructions in progress (1 239) (19 433) Foreign exchange difference and other (586) (828) (8 144) (20 872) (446) (8 609) (38 899) At September 30, OTHER FINANCIAL ASSETS It includes mainly deposits, employee loans and non-consolidated investments. At September 30, At December 31, Deposits Employee loans (from French "1% logement") Other non-current assets Total other financial assets

26 6.4. INVENTORIES At September 30, At December 31, Work in Progress Finished goods Raw Materials Provision / Impairment on Inventories (15 736) (17 679) Total inventories The amounts shown above include provisions and the elimination of the intercompany margin in finished goods inventory for Albéa entities TRADE AND OTHER RECEIVABLES At September 30, At December 31, Trade receivables, gross Less : impairment (2 864) (3 094) Trade receivables, net Operating Working Capital - assets Non-operating Working Capital - assets Other debtors Total Trade receivables and other debtors Due to their short-term maturities, the fair value of Trade receivables and other is close to its carrying amount. None of Albéa s trade receivables is interest bearing CASH AND CASH EQUIVALENTS Cash and cash equivalents comprise cash in bank accounts and on hand, short-term deposits held on call with banks and highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value, less bank overdrafts that are repayable on demand. Bank overdrafts are included in current borrowings. At September 30, At December 31, Cash in bank accounts and on hand Short-term bank deposits and investments Cash and cash equivalents Less: Bank overdrafts repayable on demand (1 824) (6 037) Net Cash and cash equivalents Net cash and cash equivalents include USD 26.5 million of cash from some subsidiaries which is not immediately available at group level. 25

27 6.7. CAPITAL STOCK The capital of Albéa Beauty Holdings S.A. amounts to EUR BORROWINGS Changes in borrowings during the period: Asset Based Lending / Factoring PEC - Preferred Equity Bonds, net (1) Finance lease liabilities Other borrowings At December 31, New finance lease obligations Proceeds from loans other than lease obligations Repayment of loans - (910) - (6 553) (8 132) (15 595) Factoring (34 334) (34 334) Accrued interests Amortization of arrangement fees Proceeds from / (repayment of) bank overdrafts (3 729) (3 729) Acquisition / Divestitures Borrowings reclassified as liabilities held for sale Exchange differences (including Swap faire value) (3 116) - (17 986) (3 046) (8 023) (32 171) Other (103) - (1) - 13 (91) At september 30, Total (1) Bonds, net of amortized financing fees (USD 16,9 million) In the nine-month period ended September 30, 2015, Preferred Equity Certificate were redeemed for USD 0.9 million. Asset Based Lending / Factoring : Transferred assets under these factoring arrangements are Trade receivables for the Credit Agricole Leasing Factoring / Eurofactor European arrangement and Hong-Kong arrangement, and Trade receivables and Inventories for the ABL US arrangement. In accordance with IAS 39.30, these transferred assets are not derecognized in the financial statements as Albéa is still considered as "continuing involved" in the recoverability of these assets. When risk and rewards attached to receivables are transferred, the assets are not anymore recognized (USD 52.3 million as at September 30, 2015 net of deposit). 26

28 6.8. BORROWINGS (CONTINUED) Net debt At September 30, At December 31, Asset Based Lending / Factoring PEC - Preferred Equity Certificates Bonds, net Finance lease liabilities Other (excluding bank facilities and bank overdraft) Borrowings excluding bank facilities and bank overdraft (A) Short-term bank deposits and investments Cash in bank accounts and on hand Bank facilities and bank overdraft (1 824) (6 037) Net Cash and cash equivalents (B) Net Debt (A) - (B) The maturity of the borrowings is the following: At September 30, 2015 Less than one year Between 1 and 3 years Between 3 and 5 years More than five years Asset Base Landing / Factoring PEC - Preferred Equity Certificates Bonds Finance lease liabilities Others Gross borrowings Less: Amortized financing fees (2 370) (9 407) (4 451) 0 (16 228) Borrowings Total 27

29 6.9. PENSIONS AND OTHER LONG-TERM EMPLOYEE BENEFITS OBLIGATIONS Pensions Other long-term employee benefit obligations Termination benefits At December 31, Current service costs Interest costs Benefits paid (1 326) (105) (202) (1 633) Change in exchange variation (5 216) (464) (149) (5 829) Actuarial gains and losses on benefit obligations (4 974) (303) - (5 277) At September 30, Total Net decrease of Pension provision is mainly due to the downward trend of discount rate in 2015 see above note

30 6.10. PROVISIONS (Excluding pension and OPEB) At December 31, 2014 Allowances Reversals of provisions used Reversals of provisions not used Foreign exchange impact Other At September 30, 2015 Restructuring (2 719) (604) (427) (530) Other provisions for risks and contingencies (724) (169) (284) Total Provisions (3 443) (773) (711) (448) of which current - Provision of which non current - Provision The provision for restructuring mainly includes restructuring plan launches in several sites. Provisions for litigation and claims were recognized for all litigations (commercial, employee, and tax-related) identified at September 30, OTHER FINANCIAL LIABILITIES At September 30, 2015, the current and non-current liabilities includes mainly : USD 1.6 million (USD 1.1 current million and USD 0.6 million non-current) : remaining deferred revenue related to the Chinese government grant. USD 19.0 million have been reversed in profit and loss as a proceed on the buildings and USD 28.4 million have been used by Albéa to compensate the relocation expenditures incurred since TRADE AND OTHER PAYABLES At September 30, At December 31, Trade payables Other payables Employee payables Total Trade and other payables

31 6.13. ASSEST HELD FOR SALES At September 2015, it s includes only buildings in France in Menehould for USD 1.3 million, same as last year, variation is only due to foreign exchange. NOTE 7 RELATED PARTIES Related parties transactions include : - The PEC and CPEC Debt component issued in 2010 and 2012 and associated interest cost with entities controlled by Sun Capital (see note 6.10 borrowings and other financial liabilities in the Group s annual consolidated financial statements for the year ended December 31, 2014); - Management fees invoiced by Sun Capital Partners Management V, LLC for an amount of USD 3.1 million. NOTE 8 SUBSEQUENT EVENTS To the best of management s knowledge, there is no significant event that occurred since September 30, 2015, which would materially impact the interim condensed consolidated financial statements. 30