Vranken-Pommery Monopole First-Half 2008 Financial Results

Transcription

1 PRESS RELEASE - FOR IMMEDIATE RELEASE Vranken-Pommery Monopole First-Half 2008 Financial Results Consolidated revenue up 3.4% Result for the period: 4.9% improvement REIMS, SEPTEMBER 16, The Board of Directors of Vranken-Pommery Monopole met on September 15, 2008 to approve the Group s financial statements for the six months ended June 30, The meeting was chaired by Paul-François Vranken and attended by the company s auditors. Consolidated accounts (in millions of euros) H H1 2007* % change Full-year 2007 (adjusted) Consolidated revenue % Recurring operating profit % 50.4 Profit (loss) attributable to equity holders of the parent (1.9) (2.0) + 4.9% 17.8 * * Adjusted for the change in tax rate used to calculate deferred tax liabilities: negative impact of 476,000 versus 2007 reported profit, of which 119,000 attributable to minority interests "The worldwide champagne market held up well in the first half and we are satisfied with our sales growth," said Paul-François Vranken, Chairman and Chief Executive Officer. "During the period, we successfully pursued our strategy of improving the price mix and developing our international brands." 1/8

2 BUSINESS PERFORMANCE Analysis by product Champagne revenue for the first six months of 2008 was up 4.7% on the yearearlier period. The Group pursued its strategy of improving the product mix, with the international brands led by Vranken and Pommery enjoying 6.1% growth compared with firsthalf Sales of Heidsieck & Co Monopole and Champagne Charles Laffite, the Group s other two international brands, also remained firm over the period. The Port wine (Rozes) distribution network was extended in Northern Europe and port sales also grew rapidly in Portugal. In the distribution of Vins des Sables (Listel) and Vins de Provence (La Gordonne), the Group consolidated the positions acquired in early 2007 by repositioning the ranges. Analysis by region Export sales of Champagne were up 15.6% at current exchange rates, or by 18.2% excluding the currency effect. Business was strong in Europe, particularly in Belgium, Germany and Switzerland, while growth was also good in Japan. Despite the decline in the dollar against the euro, sales also increased in the United States, primarily due to the fact that Pommery distribution has been taken over by the American subsidiary. FINANCIAL INFORMATION Income statement Recurring operating profit rose 54.2% to 10.5 million in first-half 2008 from 6.8 million in the same period of Because of the highly seasonal nature of Champagne sales, it is impossible to identify a clear trend for full year profitability based on performance in the first six months alone. However, revenue growth and favorable changes in the product mix led to improved coverage of fixed costs during the period. Finance costs and other financial income and expense, net came to 13.0 million versus 9.9 million in first-half The increase was due to higher interest rates and to the cost of financing the final stage of the build-up in inventories that was necessary to enable the Group to continue to grow in a period of shortages. Loss attributable to equity holders of the parent improved slightly to 1.9 million in first-half 2008 from 2.0 million in the year-earlier period. 2/8

3 Net debt and financial position As previously mentioned, production needs to be kept in cellars for at least three years before it can be sold, in order to ensure consistently superior quality, and it is therefore necessary to arrange specific financing of these inventories. At June 30, 2008, net debt totaled 531 million compared with 481 million a year earlier, and was entirely secured by inventories which represented 101.7% of the outstanding balance versus 101.5%. The increase in net debt in first-half 2008 was due to the higher working capital requirement, which in turn reflected the build-up in inventories combined with an unusually pronounced seasonal downturn in sales, as well as a reduction in tax liabilities. The level of debt is expected to fall in the second half, partly as a result of the less abundant grape harvest in 2008 compared with Equity stood at million at June 30, 2008, attesting to the Group's stronger financial position. Dividend At the Annual General Meeting on June 11, 2008, shareholders approved a 2007 dividend of 1.35 per share, representing a total payout of 7 million. The dividend was payable on July 15, HIGHLIGHTS OF THE PERIOD On January 1, 2008, the marketing organization was revamped to create two distinct Prestige networks in France and the rest of Europe, one for Vranken and the other for Pommery. Their coexistence is making it possible to distribute the brands more widely and to expand each network s customer base. During the first half, the Group successfully prepared to take over distribution of its products in Italy and created a subsidiary there. OUTLOOK Champagne sales are highly seasonal, with the first half traditionally contributing around 30% of annual revenue compared with around 50% in the fourth quarter alone. However, based on the good level of first-half business and the orders booked for delivery in the second half, the Group remains confident that the current growth momentum will be maintained throughout the rest of the year. 3/8

4 INVESTOR CALENDAR Third-quarter revenue: October 23, 2008 Fourth-quarter revenue: January 22, 2009 ABOUT VRANKEN-POMMERY MONOPOLE Vranken-Pommery Monopole is one of the world's leading Champagne groups. Its balanced portfolio of brands spans the entire market, with Pommery Cuvée Louise, Vranken Demoiselle and Diamant, Pommery and Pop, Champagne Charles Lafitte and Heidsieck & Co Monopole champagnes. It is also present in premium port wines, with Rozès and São Pedro, and is positioned as a prime distributor of rosé wines, with Vins des Sables (Domaines Listel) and Vins de Provence (Château La Gordonne), which it markets worldwide. Vranken-Pommery Monopole had 2007 revenue of million. Taking into account the distribution of Listel products, business volume, net of marketing agreements, amounted to more than 350 million worth of value-added products. The Vranken-Pommery Monopole share is traded on the NYSE Euronext Paris stock exchange, Compartment B (VRAP; ISIN: FR ). CONTACTS Vranken-Pommery Monopole LT Value Paul Bamberger Nancy Levain Maryline Jarnoux-Sorin Sophie Accaoui Pascale Weitzmann Managing Director Investor Relations Media Relations Tel: Tel: Tel: pbamberger@vrankenpommery.fr nancy.levain@ltvalue.com maryline.jarnoux-sorin@ltvalue.com sophie.accaoui@ltvalue.com pascale.weitzmann@ltvalue.com 4/8

5 Appendices Vranken Pommery Monopole Consolidated Income Statement for First-Half IFRS (in thousands) First-half 2008 First-half 2007 Full-year 2007 (adjusted) Full-year 2007 (reported) Revenue Puchases used in production (57 418) (59 057) ( ) ( ) Personnel costs (17 207) (16 364) (34 891) (34 891) Other operating income Other operating expenses (301) (666) (2 042) (2 042) Taxes other than on income (1 709) (1 081) (2 748) (2 748) Reversals of depreciation, amortization and provisions; expense transfers Depreciation, amortization and provision expense (4 415) (4 522) (9 706) (9 706) Recurring operating profit Other income Other expenses (1 069) (503) (1 409) (1 409) Operating profit Financial income Finance costs and other financial expenses (15 446) (12 133) (27 042) (27 042) Profit (loss) before tax (2 715) (2 967) Income tax (expense) benefit** (9 390) (8 914) Profit (loss) for the period** (1 984) (1 988) Minority interests** (80) Profit (loss) attributable to equity holders of the parent** (1 904) (2 002) Basic earnings (loss) par share (in ) - 0,37 (0,38) 3,49 3,49 Diluted earnings (loss) par share (in ) - 0,37 (0,38) 3,49 3,49 * Including statutory and discretionary profit-sharing ** Adjusted for the change in tax rate used to calculate deferred tax liabilities: Negative impact of 476,000 versus 2007 reported profit, including 119,000 attributable to minority interests 5/8

6 Vranken Pommery Monopole Consolidated balance sheet at June 30, IFRS Assets (in thousands) At June 30, 2008 At June 30, 2007 (adjusted) At December 31, 2007 (adjusted) Goodwill - - Intangible assets Property, plant and equipment Other non-current assets Deferred tax assets Total non-current assets Inventories Trade receivables Other current assets Current financial assets Cash and cash equivalents Total current assets Total assets Equity and Liabilities (in thousands) At June 30, 2008 At June 30, 2007 (adjusted) At December 31, 2007 (adjusted) Share capital Reserves and share premium account* Profit/(loss) for the period* Equity attributable to equity holders of the parent* Minority interests* Total equity Long-term borrowings Employee benefit obligations Deferred tax liabilities* Total non-current liabilities Trade payables Short-term provisions Income taxes payable Other current liabilities Short-term borrowings Current financial liabilities Total current liabilities Total equity and liabilities * Adjustment of deferred tax liabilities on international brands - see Accounting policies 6/8

7 Consolidated balance sheet at June 30, IFRS (cont'd) Assets At June 30, 2008 At December 31, 2007 (in thousands) Adjusted Reported Adjusted Reported Goodwill Intangible assets Property, plant and equipment Other non-current assets Deferred tax assets Total non-current assets Inventories Trade receivables Other current assets Current financial assets Cash and cash equivalents Total current assets Total assets Equity and Liabilities At June 30, 2008 At December 31, 2007 (in thousands) Adjusted Reported Adjusted Reported Share capital Reserves and share premium account Profit/(loss) for the period Equity attributable to equity holders of the parent Minority interests Total equity Long-term borrowings Employee benefit obligations Deferred tax liabilities Total non-current liabilities Trade payables Short-term provisions Income taxes payable Other current liabilities Short-term borrowings Current financial liabilities Total current liabilities Total equity and liabilities /8

8 Vranken Pommery Monopole Statement of Changes in Net Debt First-Half 2008 IFRS in millions Net debt at December 31, 2007 (476,0) Cash flow 0,7 Capital expenditure, net (6,6) Change in working capital (44,0) 2007 dividend (7,0) Effect of applying IAS 32/IAS 39 2,2 Net debt at June 30, 2008 (530,7) 8/8