MARCH 31, A European leader in the distribution of specialty steels. Euronext Paris Compartment B

Transcription

1 Activity report MARCH 31, 2017 A European leader in the distribution of specialty steels Euronext Paris Compartment B

2 Press release dated May 3, 2017 Q results > Sales 465 million (up 10% vs Q1 2016) > EBITDA 31.2 million > Net income (Group share) 15.3 million On May 3, 2017 the Board of Directors, chaired by Éric Jacquet, approved the consolidated financial statements for the three months ended March 31, m Q Q Sales Gross margin % of sales 26.2% 22.3% EBITDA % of sales 6.7% 2.1% Operating income before non-recurring items % of sales 5.8% 1.0% Operating income Net income / (loss) (Group share) 15.3 (1.1) 1 Adjusted for non-recurring items. The business review includes a definition of non-ifrs financial indicators and explains the methods used to calculate them. Press release dated may 3, 2017 Q results First quarter 2017 sales and earnings In a context of metal prices remaining at low levels, sales amounted to 465 million, up 10% compared to Q1 2016, including the following effects: Volumes sold: +1.5%, Price: +8.5%. The price effect compared to Q was +3.9%. The gross margin came to million (an increase of 27.7 million compared to Q1 2016), representing 26.2% of sales compared to 22.3% a year earlier. EBITDA amounted to 31.2 million (6.7% of sales), compared to 8.8 million in Q (2.1% of sales) while operating income before non-recurring items amounted to 26.9 million (5.8% of sales) up from 4.1 million a year earlier (1% of sales). Net income (Group share) amounted to 15.3 million (3.3% of sales). Financial position The Group generated operating cash flow of million during Q ( 23.6 million excluding factoring). At March 31, 2017, operating working capital amounted to 370 million, or 22.7% of sales, including inventories of 378 million, versus 23.4% at December 31, Q1 capital expenditure amounted to 4.1 million, mainly relating to new finishing capacity. At March 31, 2017 Group net debt stood at 170 million, compared to shareholders equity of 313 million, resulting in a net debt to equity ratio of 54.2% (69.2% at December 31, 2016). Dividend The Board of Directors will propose a dividend of 0.50 per share to the General Meeting of shareholders on June 30, 2017.

3 Q sales and earnings by division Stainless steel and wear-resistant quarto plates Stainless steel long products Engineering steels m Q Q Q Sales Change vs % 14.4% 5.1% Price effect 13.4% 14.3% 4.0% Volume effect 2.3% 0.1% 1.1% EBITDA % of sales 7.2% 7.7% 5.8% Operating income before non-recurring items % of sales 5.1% 7.5% 5.2% 1 Non-division activities contributed 0.6 million to Q EBITDA. 2 Adjusted for non-recurring items. The business review includes a definition of non-ifrs financial indicators and explains the methods used to calculate them. Press release dated may 3, 2017 Q results JACQUET Abraservice specializes in the distribution of stainless steel and wear-resistant quarto plates. JACQUET and Abraservice have separate sales networks. The division generates 76% of its business in Europe and 17% in North America. Sales amounted to 98.1 million compared to 84.8 million in Q1 2016, up 15.6% (volume effect +2.3%, price effect +13.4%). The gross margin rate rose 3 percentage points to 31.7%, while gross margin came to 31.1 million compared to 24.4 million in Q The division recorded EBITDA of 7.1 million (7.2% of sales), compared to 1.9 million a year earlier (2.3% of sales). STAPPERT specializes in the distribution of long stainless steel products in Europe. It generates 41% of its sales in Germany, the largest European market. IMS group specializes in the distribution of engineering steels, usually in the form of long products. This division has included the S+B Distribution network acquired from Schmoltz+Bickenbach in the second semester of This network has been renamed IMS group since January The division generates 49% of its sales in Germany, the largest European market. IMS group s sales amounted to million compared to 229 million a year earlier, up 5.1% (volume effect +1.1%, price effect +4.0%). The gross margin rate rose 4.4 percentage points to 24.9% of sales, while gross margin came to 60 million compared to 47.1 million in Q IMS group recorded EBITDA of 13.9 million (5.8% of sales), compared to 2.8 million (1.2% of sales) a year earlier. S+B Distribution s contribution to EBITDA was 5.7 million (4% of sales), compared to a 0.4 million loss in Q Sales amounted to million compared to million a year earlier, up 14.4% (volume effect +0.1%, price effect +14.3%). The gross margin rate rose 4.6 percentage points to 24.1%, while gross margin came to 30.5 million compared to 21.5 million in Q STAPPERT recorded EBITDA of 9.7 million (7.7% of sales), compared to 2.6 million in Q (2.4% of sales).

4 Key financial information Results m Q Q Sales Gross margin % of sales 26.2% 22.3% EBITDA % of sales 6.7% 2.1% Operating income before non-recurring items % of sales 5.8% 1.0% Operating income Net income / (loss) (Group share) 15.3 (1.1) 1 Adjusted for non-recurring items. The business review includes a definition of non-ifrs financial indicators and explains the methods used to calculate them. Balance sheet m Goodwill Net non-current assets Press release dated may 3, 2017 Q results Net inventory Net trade receivables Other assets Cash Total assets Shareholders equity Provisions (including provisions for employee benefit obligations) Trade payables Borrowings Other liabilities Total equity and liabilities Cash flow m Operating cash flow before change in working capital Change in working capital 16.5 (2.2) Cash flow from operating activities Capital expenditure (4.1) (18.3) Asset disposals Dividends paid to shareholders of Jacquet Metal Service SA (9.5) Interest paid (2.6) (9.6) Other movements Change in net debt Net debt brought forward Net debt carried forward First half 2017 results: September 6, 2017 after close of trading Jacquet Metal Service is a European leader in the distribution of specialty steels. The Group operates and develops a portfolio of four brands: JACQUET (stainless steel quarto plates), STAPPERT (long stainless steel products), Abraservice (wear-resistant quarto plates) and IMS group (engineering steels). Jacquet Metal Service employs 3,317 people and has a network of 109 distribution centers across 26 countries spanning Europe, China and North America. Jacquet Metal Service Thierry Philippe - Chief financial officer comfi@jacquetmetals.com NewCap - Investors relation Emmanuel Huynh / Julien Perez Tel. : jacquetmetalservice@newcap.eu Compartment B ISIN : FR Reuters : JCQ.PA Bloomberg : JCQ FP

5 Activity report MARCH 31, 2017 The Group _ 02 1 A leading distributor of specialty steels 2 Brand management 3 Stock market information 4 Shareholder structure at March 31, Financial communication schedule _ 02 _ 03 _ 04 _ 04 _ 05 Activity report - March 31, 2017 _ 06 1 Group sales and earnings 2 Sales and earnings by division 3 Consolidated financial position _ 06 _ 08 _ 10

6 The group 1 A leading distributor of specialty steels > Sales 1.6 billion > Staff 3,317 > Distribution centers 109 > Countries of operation 26 Breakdown of sales * Outside Europe 2 % Overview of the group Other Europe 24 % Germany 40 % North America 4 % Spain 7 % Netherlands 7 % Italy 7 % France 9 % * Q data Jacquet Metal Service is a European leader in the distribution of specialty steels, and is also active in Asia and North America. 02

7 A global player World Europe Overview of the group 2 Brand management Jacquet Metal Service operates in high value-added niche markets and is a European leader in the distribution of specialty steels through its portfolio of four brands organized into three divisions, each of which targets specific customers and markets. Stainless steel and wearresistant quarto plates Stainless steel long products Engineering steels Each division is run by an operating manager, who is in charge of developing the relevant brand(s) in accordance with the strategic options and goals defined by the Group. Central functions, the negotiation of purchasing terms, financial and legal affairs, information technology, credit insurance and communications are managed by Jacquet Metal Service SA, in close collaboration with the specialists from each division. 03

8 3 Stock market information General features of shares and market capitalization source: Jacquet Metal Service > Main indices : CAC All Shares, CAC All-Tradable, CAC Basic Materials, CAC Mid & Small, CAC PME, CAC Small, Next 150 > Market : Euronext Paris - Compartment B > Listed on : Euronext Paris > Code or ticker : JCQ > ISIN code : FR > Reuters : JCQ.PA > Bloomberg : JCQ : FP Q Number of shares at end of period number of shares 24,028,438 24,028,438 Market capitalization at end of period , ,003 High in euros Low in euros Price at end of period in euros Overview of the group Average daily trading volume number of shares 27,941 23,718 source : Euronext The share price for Jacquet Metal Service ( JCQ ) as of March 31, 2017 was 22.58, up 14% compared to the closing price on December 31, The share price was on May 2, Jacquet Metal Service shares are followed by Société Générale SGCIB and Oddo Securities. 4 Shareholder structure at march 31, 2017 Breakdown of share capital Breakdown of voting rights Other 47.17% Éric Jacquet / JSA 40.32% Other 36.45% Éric Jacquet / JSA 54.02% Treasury shares 1.34% Concert R.W. Colburn 6.00% Moneta Asset Management 5.17% Treasury shares 1.02% Moneta Asset Management 3.94% Concert R.W. Colburn 4.57% Éric Jacquet and JSA (which is controlled by Éric Jacquet) held 40.32% of the share capital and 54.02% of the voting rights in the Company at March 31, The Group did not sell or buy any treasury stock (outside the scope of the liquidity agreement) during Q

9 5 Financial communication schedule > Shareholders General meeting : June 30, 2017 > Results for the six months ended June 30, 2017 : September 6, 2017 > Results for the nine months ended September 30, 2017 : November 15,2017 > 2017 Full year results : March 2018 Investors and shareholders may obtain complete financial information from the Company s website at : Investor relations > Jacquet Metal Service Thierry Philippe Chief Financial Officer comfi@jacquetmetals.com > NewCap Emmanuel Huynh / Julien Perez T jacquetmetalservice@newcap.eu Overview of the group 05

10 > Activity report March 31, Group sales and earnings The results for the three months ended March 31, 2017 are compared to the full-year results for 2016, which may be consulted in the 2016 Registration Document filed with the Autorité des Marchés Financiers (French market regulator or AMF) on April 4, 2017 (filing no. D ). 000 Q1,2017 Q1,2016 Sales 464, ,561 Gross margin 121,813 94,125 % of sales 26.2% 22.3% Operating expenses (93,631) (87,470) Net depreciation and amortization (5,130) (5,198) Group sales and earnings Net provisions 3,942 2,863 Gains / (losses) on disposals of non-current assets Non-recurring income and expenses Operating income 27,084 4,385 Net financial expense (2,599) (2,926) Income before tax 24,485 1,459 Corporate income tax (8,192) (2,004) Consolidated net income / (loss) 16,293 (545) Net income / (loss) (Group share) 15,285 (1,091) Earnings per share in circulation ( ) 0.64 (0.05) Operating income 27,084 4,385 Non-recurring items and gains / losses on disposals (228) (321) Operating income before non-recurring items 26,856 4,064 % of sales 5.8% 1.0% Net depreciation and amortization 5,130 5,198 Net provisions (3,942) (2,863) Non-recurring items 3,195 2,434 EBITDA 31,239 8,833 % of sales 6.7% 2.1% 06

11 Sales In a context of metal prices remaining at low levels, Q1 sales amounted to 465 million, up 10% compared to 2016, including the following effects: > Volumes sold: +1.5 %, > Price: +8.5%. The price effect compared to Q was +3.9%. m T T Sales Change vs % Price effect 8.5% Volume effect 1.5% Group sales and earnings The various effects are calculated as follows: > Volume effect = (Vn - Vn-1) Pn-1, where V = volumes and P = average sale price converted into euros at the average exchange rate; > Price effect = (Pn -Pn-1) Vn; > The exchange rate effect is included in the price effect. There was no significant impact in Q1-2017; > Change in consolidation / current year acquisitions and disposals > Acquisitions: change in consolidation corresponds to the contribution (volumes and sales) of the acquired entity since the acquisition date; Gross margin > Disposals: change in consolidation corresponds to the contribution (volumes and sales) made by the sold entity in the year preceding disposal from the date falling one year before the disposal date until the end of the previous year; > Change in consolidation/previous year acquisitions and disposals > Acquisitions: change in consolidation corresponds to the contribution (volumes and sales) of the acquired entity in the current year from January 1 until the anniversary of the acquisition; > Disposals: change in consolidation corresponds to the contribution (volumes and sales) of the sold entity from January 1 the previous year until the date of disposal. The gross margin came to million (an increase of 27.7 million compared to Q1 2016), representing 26.2% of sales compared to 22.3% a year earlier. m Q Q Sales Cost of goods sold (343.1) (328.4) Incl. purchases consumed (337.3) (328.3) Incl. inventory impairment (5.9) (0.1) Gross margin Gross margin rate 26.2% 22.3% Operating income Operating expenses before non-recurring items (including net depreciation, amortization and provisions) amounted to 95 million in Q1 2017, up from 90 million in Q1 2016: this 5 million variation is primarily due to an increase in variable expenses linked to the activity growth and the improvement in profitability. EBITDA amounted to 31.2 million (6.7% of sales), compared to 8.8 million in Q (2.1% of sales) while operating income before non-recurring items amounted to 26.9 million (5.8% of sales) compared to 4.1 million a year earlier (1% of sales). Q EBITDA is adjusted for non-recurring items ( 3.1 million) mainly composed of reversals of provisions linked to the S+B Distribution restructuring. 07

12 Net financial income / (expense) Net financial expense in Q came to 2.6 million, compared to a 2.9 million expense in the same period last year. m Q Q Net cost of debt (1.7) (1.8) Other financial items (0.9) (1.2) Net financial expense (2.6) (2.9) Net income Net income (Group share) in Q amounted to 15.3 million. m Q Q Income before tax Corporate income tax (8.2) (2.0) Income tax rate (33.5%) (137.4%) Consolidated net income / (loss) 16.3 (0.5) Minority interests (1.0) (0.5) Net income / (loss) (Group share) 15.3 (1.1) Sales and earnings by division % of sales 3.3% (0.3%) 2 Sales and earnings by division Q operations and brand development JACQUET Abraservice STAPPERT IMS group Stainless steel and wearresistant quarto plates Stainless steel long products Engineering steels m Q Q Q Sales Change vs % 14.4% 5.1% Price effect 13.4% 14.3% 4.0% Volume effect 2.3% 0.1% 1.1% EBITDA % of sales 7.2% 7.7% 5.8% Operating income before non-recurring items % of sales 5.1% 7.5% 5.2% 1 Non-division activities contributed 0.6 million to Q EBITDA. 2 Adjusted for non-recurring items. The business review includes a definition of non-ifrs financial indicators and explains the methods used to calculate them. 08

13 JACQUET Abraservice Stainless steel and wear-resistant quarto plates This division comprises the JACQUET and Abraservice brands, specialized in the distribution of stainless steel and wear-resistant quarto plates, respectively. JACQUET and Abraservice have separate sales networks. The division generated 76% of its business in Europe and 17% in North America. The gross margin rate rose 3 percentage points to 31.7%, while the gross margin came to 31.1 million compared to 24.4 million in Q The division recorded quarterly EBITDA of 7.1 million (7.2% of sales), compared to 1.9 million a year earlier (2.3% of sales). Sales amounted to 98.1 million compared to 84.8 million in Q1 2016, up 15.6% (volume effect +2.3%, price effect +13.4%). m Q Q Sales Change vs % Price effect 13.4% Volume effect 2.3% Gross margin % of sales 31.7% 28.7% EBITDA % of sales 7.2% 2.3% Operating income / (loss) before non-recurring items 5.0 (0.1) % of sales 5.1% (0.1%) Consolidated financial position STAPPERT Stainless steel long products This division specializes in the distribution of long stainless steel products in Europe. It generated 41% of its sales in Germany, the largest European market. The gross margin rate rose 4.6 percentage points to 24.1%, while the gross margin came to 30.5 million compared to 21.5 million in Q Sales amounted to million compared to million a year earlier, up 14.4% (volume effect +0.1%, price effect +14.3%). STAPPERT recorded EBITDA of 9.7 million (7.7% of sales), compared to 2.6 million in Q (2.4% of sales). m Q Q Sales Change vs % Price effect 14.3% Volume effect 0.1% Gross margin % of sales 24.1% 19.5% EBITDA % of sales 7.7% 2.4% Operating income / (loss) before non-recurring items % of sales 7.5% 2.1% 09

14 IMS group Engineering steels IMS group specializes in the distribution of engineering steels, usually in the form of long products. This division has included the S+B Distribution network acquired from Schmoltz + Bickenbach in the second semester of This network has been renamed IMS group since January The division generated 49% of its sales in Germany, the largest European market. IMS group s sales amounted to million compared to 229 million a year earlier, up 5.1% (volume effect +1.1%, price effect +4.0%). The gross margin rate rose 4.4 percentage points to 24.9%, while gross margin came to 60 million compared to 47.1 million in Q IMS group recorded EBITDA of 13.9 million (5.8% of sales), compared to 2.8 million (1.2% of sales) a year earlier. S+B Distribution s contribution to EBITDA was 5.7 million (4% of sales), compared to a 0.4 million loss in Q m Q Q Sales Change vs % Price effect 4.0% Volume effect 1.1% Gross margin % of sales 24.9% 20.5% EBITDA % of sales 5.8% 1.2% Consolidated financial position Operating income / (loss) before non-recurring items % of sales 5.2% 0.4% 3 Consolidated financial position Summary balance sheet The summary balance sheet below sets out Jacquet Metal Service s consolidated financial position at March 31, 2017 and December 31, Goodwill 68,477 68,489 Net non-current assets 146, ,598 Net inventory 378, ,243 Net trade receivables 228, ,315 Other assets 92,109 91,707 Cash 61,851 72,951 Total assets 975, ,303 Shareholders equity 313, ,522 Provisions (including provisions for employee benefit obligations) 108, ,274 Trade payables 236, ,429 Borrowings 234, ,231 Other liabilities 82,236 61,847 Total equity and liabilities 975, ,303 10

15 Working capital At March 31, 2017, operating working capital amounted to 370 million, representing 22.7% of sales, including inventories of 378 million, versus 23.4% at December 31, Variation Net inventory 378, ,243 Days sales outstanding Net trade receivables 228, ,315 Days sales outstanding Trade payables (236,937) (176,429) Days payable outstanding Net operating working capital 369, ,129 (1,247) % of sales % 23.4% Other receivables or payables excluding taxes and financial items (39,161) (24,059) Working capital excluding taxes and financial items 330, ,070 Changes in consolidation and other 128 Working capital before taxes and financial items and adjusted for other changes 330, ,198 (16,477) % of sales % 21.9% 1 Rolling 12 months Consolidated financial position Group inventories amounted to million at March 31, 2017 compared to million at December 31, Inventory levels reduced from 142 to 137 days sales at March 31, Trade receivables amounted to million at March 31, 2017, with an average customer payment term that remained stable compared to December 31, 2016 (around 46 days sales, excluding the impact of receivables assigned without recourse). The Group had assigned trade receivables amounting to 50 million at March 31, 2017 without recourse, compared to 31.8 million at December 31, This increase was mainly due to the increase in sales compared to Q (up 95 million). Trade payables amounted to million at March 31, 2017, with an average supplier payment term (around 52 days purchases) that remained stable compared to December 31, Net debt At March 31, 2017 Group net debt amounted to million, compared to shareholders equity of 313 million, resulting in a net debt to equity ratio of 54.2% (69.2% at December 31, 2016) Borrowings 234, ,231 Cash, cash equivalents and other 65,008 75,969 Net debt 169, ,262 Debt to equity ratio 54.2% 69.2% 11

16 Financing The Group had 554 million in lines of credit at March 31, 2017, 42% of which had been used: m Authorized at Mar. 31, 2017 Used at Mar. 31, 2017 % used Jacquet Metal Service SA financing % Syndicated revolving loan % Schuldscheindarlehen (private placement of debt instruments under German law) % Lines of credit % Subsidiary financing % Lines of credit % Factoring % Asset financing (term / revolving loans and leasing) % Total % Consolidated financial position In addition to the financing shown in the table above, at March 31, 2017 the Group also had 65 million of non-recourse receivable credit lines, 50.0 million of which had been used. Financing covenants primarily apply to the syndicated revolving loan and the German private placement (Schuldscheindarlehen) contracted by Jacquet Metal Service SA in These covenants mainly correspond to commitments that must be complied with at Group level. The main terms of the syndicated revolving loan are as follows: > Date of signature: July 16, 2015 > Maturity: July 16, 2018 > Amount: 125 million (unused) > Guarantee: None > Change of control clause: JSA must hold at least 40% of Jacquet Metal Service SA's share capital and voting rights. > Main covenants for 2017: > Net debt less than 275 million at June 30 and less than 250 million at December 31, or leverage less than 2.0 > Annual capital expenditure less than 30 million; > Debt to equity ratio less than 1. The main terms of the Schuldscheindarlehen are as follows: > Date of signature: October 30, 2015 > Maturity: October 30, 2020 > Amount: 88 million (fully used) > Guarantee: None > Change of control clause: JSA must hold at least 40% of Jacquet Metal Service SA's share capital and voting rights. > Main covenant: > Debt to equity ratio less than 1. The Group is in compliance with its financing covenants. 12

17 Cash flow Operating cash flow before change in working capital 25,088 45,353 Change in working capital 16,477 (2,234) Cash flow from operating activities 41,565 43,119 Capital expenditure (4,058) (18,262) Asset disposals 529 1,166 Dividends paid to shareholders of Jacquet Metal Service SA (9,460) Interest paid (2,598) (9,616) Other movements 94 1,321 Change in net debt 35,532 8,268 Net debt brought forward 205, ,530 Net debt carried forward 169, ,262 The Group generated operating cash flow of 41.6 million during Q ( 23.6 million excluding factoring). At March 31, 2017, operating working capital amounted to 370 million, representing 22.7% of sales, including inventories of 378 million, versus 23.4% at December 31, Capital expenditure for the quarter amounted to 4.1 million, mainly relating to new finishing capacity. Consolidated financial position Dividend The Board of Directors will propose a dividend of 0.50 per share to the General Meeting of shareholders on June 30, Events subsequent to the financial closing None. 13