Zignago Vetro S.p.A. PRESS RELEASE Board of Directors of Zignago Vetro S.p.A. approves 2014 results Zignago Vetro Group revenue growth in 2014 to Euro 302 million (up 3.3%); export revenues amount to Euro 115.2 million (up 2.9%), 38.1% of total revenues. EBITDA of Euro 65.8 million (21.8% margin) impacted by major scheduled actions on a number of kilns. Operating Profit of Euro 38.2 million (12.7% margin). Cash generation, before investments, rises to Euro 71.3 million (+62.1%). Net debt of Euro 107.7 million (+1.9%). Dividend proposed: Euro 0.20 per share, with a pay-out of approx. 73%. Zignago Vetro Group Highlights (*) 2014 2013 Cge.% (in Euro millions) (in Euro millions) Revenues 302.0 292.3 + 3.3% EBITDA 65.8 67.0-1.8% EBIT 36.9 40.6-9.2% Operating Profit 38.2 41.4-7.6% Profit before taxes 35.0 38.6-9.3% Group Net Profit 23.8 26.1-8.8% Capital expenditure 53.9 36.6 Free cash flow (after investments) 17.4 7.4 (before investments) 71.3 44.0 31.12.2014 31.12.2013 (in Euro millions) (in Euro millions) Financial debt (198.9) (145.2) Liquidity 91.2 39.4 Net financial debt (107.7) (105.8) (*) The figures (and the subsequent comments refer to the consolidated figures) are based on the management view of the Group business, which provides for the proportional consolidation of the 1
joint venture, in continuity with the accounting policies adopted until December 31, 2013. Following the entry into force of the new IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures the accounting policies changed for the consolidation of the joint ventures of the Zignago Vetro Group. In particular, from January 1, 2014 the joint ventures in Vetri Speciali SpA and in Vetreco Srl, may no longer be consolidated under the proportional method but must be recognised at equity. The income statement, the comprehensive income statement, the balance sheet and the cash flows of the Zignago Vetro Group at December 31, 2014, prepared according to international accounting standards in force from January 1, 2014, in addition to the restated figures at December 31, 2013, are reported respectively at attachments 3, 4, 5 and 6 of the present press release. Fossalta di Portogruaro, March 13, 2015 The Board of Directors of Zignago Vetro S.p.A., a company listed on the STAR segment of the Italian Stock Exchange in a meeting held today chaired by Franco Grisan, approved the 2014 Consolidated Financial Statements and the 2014 Statutory Financial Statements, which will be submitted for the approval of the Shareholders AGM. The Zignago Vetro Group companies produce high quality glass containers for the Food and Beverage, Cosmetics and Perfumery industries and Speciality Glass bottles for wines and spirits, for the domestic and international markets. Zignago Vetro Group operating performance In 2014, the European Food and Beverage hollow glass market showed signs of recovery following the recovery of final consumptions in a number of countries in particular Germany. Such signs were evident also in Italy, although to a contained extent and uneven among the various market segments. Perfumery market demand appears to have strengthened and a greater confidence is apparent among sector enterprises. The Cosmetics sector remains more sluggish however. Consolidated revenues in 2014 amounted to Euro 302 million compared to Euro 292.3 million in the previous year (+3.3%). Export revenues in 2014 totaled Euro 115.2 million (+2,9% on Euro 111.9 million in 2013), comprising 38.1% of the total (38.3% in 2013). Consolidated Ebitda in 2014 was Euro 65.8 million, compared to Euro 67 million in 2013, representing a 21.8% revenue margin (22.9% in 2013). The result was impacted by major scheduled actions on a number of kilns. Consolidated Ebit amounted to Euro 36.9 million, from Euro 40.6 million in 2013, with a revenue margin of 12.2% compared to 13.9%. The consolidated Operating profit was Euro 38.2 million, compared to Euro 41.4 million in 2013, a 12.7% revenue margin (14.2% in 2013). The Consolidated Profit before taxes in 2014 totaled Euro 35 million, compared to Euro 38.6 million in 2013, a 11.6% revenue margin (13.2% in 2013). The consolidated Net profit in 2014 was Euro 23.8 million, compared to Euro 26.1 million in 2013. The net profit margin on revenues was 7.9% (8.9% in 2013). 2
Zignago Vetro Group balance sheet and financial position Group capital expenditures in 2014 totaled Euro 53.9 million (Euro 36.6 million in 2013). The Group generated free cash flow in the year, after investments, of Euro 17.4 million (Euro 7.4 million in 2013) - before investments amounting to Euro 71.3 million (Euro 44 million in 2013). Group net financial debt at December 31, 2014 was Euro 107.7 million compared to Euro 105.8 million at December 31, 2013, after the distribution of dividends to Shareholders of Euro 19 million and capital expenditure of Euro 35,4 million. Group liquidity at December 31, 2014 was Euro 91.2 million, compared to Euro 39.4 million at December 31, 2013. The increase principally relates to the funding operations concluded at the end of year ahead of the investments programmed for 2015, confirming the full availability of the lending institutions to finance Group industrial initiatives. Financial statements of the Parent Company Zignago Vetro S.p.A. The Board of Directors meeting held today also approved the Financial Statements of the parent company Zignago Vetro S.p.A.. Revenues totaled Euro 161.7 million, against Euro 161.9 million in 2013. The net profit totaled Euro 18.1 million, compared to Euro 22.1 million in 2013. Group capital expenditure in 2014 amounted to Euro 45.4 million (Euro 21.2 million in 2013). Shareholders equity at December 31, 2014 was Euro 89.9 million compared to Euro 91 million at December 31, 2013. The net debt at year-end amounted to Euro 48.9 million, compared to Euro 35.2 million at the end of 2013. During the year, the Company paid dividends of Euro 19 million (73% pay-out). Outlook and subsequent events The signs of a market recovery which gradually emerged during 2014 and those apparent in the initial months of 2015 point towards a more sustained recovery in the year. *********************** 3
The Board of Directors, based on the available information and taking account of the parameters established by the Self-Governance Code and the Stock Exchange Regulation Instructions, consider the Directors Lino Benassi, Ferdinando Businaro, Daniela Manzoni Suppiej, Chiara Mio, Manuela Romei Pasetti, Maurizio Sobrero and Giovanni Tamburi to qualify as independent. The Board of Statutory Auditors verified the correct application of the assessment criteria and procedures adopted by the Board to evaluate the independence of its members. Declaration *********************** The Executive Responsible for the preparation of the corporate and accounting documents, Mr. Roberto Celot, declares in accordance with Article 154 bis, paragraph 2, of the Consolidated Finance Act, that the accounting information contained in the present press release corresponds to the underlying accounting documents, records and accounting entries. Dividend proposed The Board of Directors proposes to the Shareholders AGM to distribute a dividend of Euro 0.20 for each of the 86,578,610 shares in circulation. The dividend pay-out is therefore Euro 17.3 million, approximately 73% of the consolidated net profit. Coupon No. 9, with ex-date of May 11, 2014 and record date of May 12, 2014, has a payment date of May 13, 2015. *********************** TREASURY SHARES The Board of Directors approved the proposal to be presented at the next Shareholders AGM for the authorisation to purchase and utilise treasury shares, with prior revocation, where not utilised, of the previous motion of April 28, 2014. This authorisation, similar to the terms of the previous motion, has the objective of allowing flexibility for the Company when opportunities arise. The proposal of the Board of Directors provides that the authorisation for the purchase of treasury shares is for a period of 18 months and that the price of the purchases may not be 20% above or below the Zignago Vetro share price recorded on the Stock Exchange in the trading day prior to each operation. The purchases of treasury shares will be made in compliance with the current regulations for listed companies and thus in accordance with Article 132 of Legislative Decree No. 58 of February 24, 1998 and subsequent amendments and Article 144 - bis of Consob Regulation No. 11971 of May 14, 1999 and subsequent amendments, and the Stock Exchange Regulations and any other regulation applicable including those of the EU Directive 2003/6 of January 28, 2003 and relative European Union and National legislation. The Shareholders AGM will also be requested to authorise the placement, of all or part and without time limit, even before the completion of purchases, of the treasury shares acquired; the shares may be sold on one or more occasions, even though an offer to the public and/or to the shareholders, on regulated Markets and/or non- 4
regulated Markets and/or outside the Market, as an institutional placement, a placement of warrants, or as consideration for acquisition or public exchange offers, at a price which may not be above or below 20% of the share price recorded on the Stock Exchange in the trading day prior to each operation. However, these price limits will not be applied where the transfer of shares is to employees, including management, executive directors, and consultants of Zignago Vetro and its subsidiaries in relation to incentive stock option plans. Pursuant to Article 2357, third paragraph, of the civil code, the maximum number of shares acquired may not be for a total nominal value, including the shares held by subsidiary companies, above 20% of the entire share capital. Within the share buy-back programme, at December 31, 2014, 1,421,390 treasury shares, corresponding to 1.615% of the share capital, taking account also of the number of treasury shares held and of the effect from the Scrip issue, had been acquired, as approved by the Shareholders' AGM of April 23, 2012. CHANGES TO COMPANY BY-LAWS The Board of Directors approved the proposal for submittal to the Extraordinary Session of the upcoming Shareholders AGM to amend Article 7 of the Company By-Laws and introduce Articles 7-bis, 7-ter and 7-quater, on the basis of the faculty recently introduced by Article 20, first paragraph of Legislative Decree No. 91 of June 24, 2014, enacted into Law No. 116 of August 11, 2014., permitting listed companies to enshrine increased voting rights into their By-Laws. Through the introduction of increased voting rights, the Italian legislature has displaced the traditional one share - one vote principle in order to incentivise medium to longterm investment, rewarding loyal shareholders through greater voting powers. The introduction of increased voting rights may serve the interests of the Company through developing the medium-long-term investment objectives, allowing shareholders who display proven loyalty to the Company (through maintaining their holding for a set period of time) to benefit from this particular right. SHAREHOLDERS AGM The Board of Directors today also called the Shareholders AGM, in Extraordinary and Ordinary Session, of Zignago Vetro S.p.A., to be held at Fossalta di Portogruaro (VE) in Via Ita Marzotto No. 8, for April 28, 2015 at the time of 11 AM in first call and for April 29, 2015, at the same time and location, in second call. *********************** This press release is available on the website: www.gruppozignagovetro.com For further information: Roberto Celot Chief Financial Officer & Investor Relations Manager Zignago Vetro S.p.A. 0421-246111 r.celot@zignagovetro.com 5
All the figures in the Consolidated Reclassified Income Statement and Balance Sheet (attachments 1 and 2) reported below were prepared on the basis of management s view which considers the proportional consolidation of joint ventures appropriate, in line with the approach taken until December 31, 2013. Following the entry into force of the new IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures the accounting policies changed for the consolidation of the joint ventures of the Zignago Vetro Group. In particular, from January 1, 2014 the joint ventures in Vetri Speciali SpA and Vetreco Srl may not be consolidated under the proportional method and should be recognised in the consolidated financial statements at equity. The balance sheet the income statement, the comprehensive income statement, the cash flows of the Zignago Vetro Group at December 31, 2014 and the statement of changes in equity, prepared according to international accounting standards in force from January 1, 2014, in addition to the restated figures for financial year 2013, are reported respectively at subsequent attachments 3, 4, 5, 6 and 7. Zignago Vetro Group Reclassified Consolidated Income Statement (unaudited) ATTACHMENT 1 (Management view based on IAS in force until December 31, 2013) 2014 2013 Change Euro thou. % Euro thou. % % Revenues 301,988 100.0% 292,284 100.0% 3.3% Changes in finished and semi-finished and products and work in progress 1,083 0.4% 5,318 1.8% n.a. Internal production of fixed assets 754 0.2% 844 0.3% n.a. Value of production 303,825 100.6% 298,446 102.1% 1.8% Cost of goods and services (169,893) (56.3%) (164,250) (56.2%) 3.4% Value added 133,932 44.4% 134,196 45.9% (0.2%) Labour costs (68,087) (22.5%) (67,166) (23.0%) 1.4% EBITDA 65,845 21.8% 67,030 22.9% (1.8%) Amortisation & Depreciation (27,838) (9.2%) (25,526) (8.7%) 9.1% Provisions (1,137) (0.4%) (876) (0.3%) 29.8% EBIT 36,870 12.2% 40,628 13.9% (9.2%) Net recurring non-operating income 1,360 0.5% 737 0.3% 84.5% O perating Profit 38,230 12.7% 41,365 14.2% (7.6%) Net financial charges (3,337) (1.1%) (2,625) (0.9%) 27.1% Net exchange gains/(losses) 114 (0.1%) (137) (0.0%) n.a. Profit before taxes 35,007 11.6% 38,603 13.2% (9.3%) Income taxes (11,169) (3.7%) (12,469) (4.3%) (10.4%) (tax-rate 2014: 31.9%) (tax-rate 2013: 32.3%) Group Net Profit 23,838 7.9% 26,134 8.9% (8.8%) 6
ATTACHMENT 2 Zignago Vetro Group Reclassified Consolidated Balance Sheet (unaudited) (Management view based on IAS in force until December 31, 2013) 31.12.2014 31.12.2013 Changes Euro thou. % Euro thou. % Euro thou. Trade receivables 61,677 62,907 (1,230) Other receivables 13,117 9,848 3,269 Inventories 68,708 68,110 598 Current non-financial payables (62,174) (57,817) (4,357) Payables on fixed assets (20,875) (7,009) (13,866) A) Working capital 60,453 25.0% 76,039 32.3% (15,586) Net tangible and intangible assets 150,131 128,655 21,476 Goodwill 40,687 40,708 (21) Other non-current assets and investments 7,723 3,750 3,973 Non-current provisions & non-financial payables (17,479) (13,752) (3,727) B) Net fixed capital 181,062 75.0% 159,361 67.7% 21,701 A+B= Net capital employed 241,515 100.0% 235,400 100.0% 6,115 Financed by: Current financial payables 111,676 113,016 (1,340) Cash and cash equivalents (91,158) (39,367) (51,791) Short-term net debt 20,518 8.5% 73,649 31.3% (53,131) Medium/long term debt 87,231 36.1% 32,132 13.6% 55,099 C) Net financial debt 107,749 44.6% 105,781 44.9% 1,968 Opening Shareholders' Equity 129,619 125,478 Dividends paid in the year (19,047) (21,645) Other net equity changes (644) (348) Group Net Profit 23,838 26,134 D) Closing shareholders equity 133,766 55.4% 129,619 55.1% 4,147 C+D = Total financial debt and shareholders equity 241,515 100.0% 235,400 100.0% 6,115 7
(Euro thousands) Zignago Vetro Group Consolidated Balance Sheet (unaudited) ATTACHMENT 3 Restated (*) at Restated (*) at 31.12.2014 31.12.2013 01.01.2013 ASSETS Non-curre nt asse ts Property, plant & equipment 119.158 95.728 89.297 Goodwill 720 741 755 Intangible assets 121 193 226 Investments valued at equity 55.782 51.588 49.147 Equity investments 386 386 384 Other non-current assets 3.845 192 83 Deferred tax assets 2.934 2.580 2.239 Total non-curre nt asse ts 182.946 151.408 142.131 Current assets Inventories 58.034 55.753 51.110 T rade receivables 48.097 50.007 51.711 Other current assets 6.706 3.050 3.731 T ax receivables 3.617 4.511 2.898 Cash and cash equivalents 89.779 39.272 44.382 Total curre nt asse ts 206.233 152.593 153.832 TO TAL ASSETS 389.179 304.001 295.963 SHAREHOLDERS' EQUITY AND LIABILITIES SHAREHO LDERS EQ UITY Share capital 8.800 8.800 8.800 Reserves 35.521 35.521 35.361 Acquisition of treasury shares (5.027) (5.027) (5.027) Retained earnings and profit 96.276 91.495 87.172 Other net equity accounts (1.804) (1.170) (828) TO TAL GRO UP SHARE. EQ UITY 133.766 129.619 125.478 MINO RITY INTEREST SHARE. EQ UITY --- - --- TO TAL SHAREHO LDERS EQ UITY 133.766 129.619 125.478 LIABILITIES Non-curre nt liabilitie s Provisions for risks and charges 3.176 2.547 2.207 Post-employ. benefits 5.015 4.839 4.720 Medium/long term loans 79.276 17.565 20.536 Other non-current liabilities 3.195 - --- Deferred tax liabilities 2.879 3.178 3.359 Total non-curre nt liabilitie s 93.541 28.129 30.822 Current liabilities Bank payables and current portion medium/long term loans 92.734 94.761 82.678 T rade payables and other 53.658 37.154 41.960 Other current liabilities 15.303 13.934 14.103 Current income taxes 177 404 922 Total curre nt liabilitie s 161.872 146.253 139.663 TO TAL LIABILITIES 255.413 174.382 170.485 TO TAL SHARE. EQ UITY AND LIABILITIES 389.179 304.001 295.963 Figures restated in accordance with requirements of IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures. 8
Zignago Vetro Group Consolidated Income Statement (unaudited) ATTACHMENT 4 Restated (*) 2014 2013 (Euro thousands) Revenues 231,544 228,216 Raw material, ancillary, consumables and goods (56,843) (48,774) Service costs (75,690) (78,517) Labour costs (53,895) (53,171) Amortisation & Depreciation (23,166) (20,938) Other operating costs (3,013) (3,302) Other operating income 1,324 1,453 Investments valued at equity 11,763 10,543 O perating Profit 32,024 35,510 Financial income 767 961 Financial charges (3,166) (2,721) Net exchange gains/(losses) 106 (134) Profit before taxes 29,731 33,616 Income taxes (5,893) (7,482) Net Profit 23,838 26,134 Minority interest profit/(loss) --- --- Group Net Profit 23,838 26,134 Earnings per share: Basic earnings (and diluted) per share 0.280 0.300 (*) Figures restated in accordance with requirements of IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures. 9
ATTACHMENT 5 Zignago Vetro Group Consolidated Comprehensive Income Statement (unaudited) 2014 Restated (*) 2013 (Euro thousands) Net Profit 23,838 26,134 Other comprehensive income statement items subsequently to be reclassified to the net profit/(loss) for the year T ranslation difference (404) (220) (404) (220) Total other comprehensive income statement items subsequently to be reclassified to the net profit/(loss) for the year (404) (220) Other comprehensive income statement items not subsequently to be reclassified to the net profit/(loss) for the year Actuarial gains/(losses) on defined benefit plans (318) (169) Tax effect 88 47 (230) (122) Total other comprehensive income statement items not subsequently to be reclassified to the net profit/(loss) for the year (230) (122) Total other comprehensive income statement items, net of taxes (634) (342) Total comprehensive net profit 23,204 25,792 Attributable to: Group 23,204 25,792 Minority interests --- --- 23,204 25,792 (*) Figures restated in accordance with requirements of IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures. 10
ATTACHMENT 6 Zignago Vetro Group Consolidated Cash Flow Statement (unaudited) Restated (*) (Euro thousands) 2014 2013 CASH FLOW FROM OPERATING ACTIVITIES: Profit before taxes 29.731 33.616 Adjustments to reconcile net profit with cash flow generated from operating activities: Amortisation & Depreciation 23.166 20.938 Losses/(gains) on disposal of property, plant & equipment (361) (185) Doubtful debt provision 123 (140) Net changes in post-employment benefits (174) (116) Net change in other provisions 628 341 Financial income and exchange gains (873) (961) Financial charges and exchange losses 3.299 2.855 Income taxes paid in the year (5.819) (10.108) Valuation of joint ventures at equity (11.763) (10.543) Dividends distributed by joint ventures valued at equity 7.496 8.050 Changes in operating assets and liabilities: Decrease/(increase) in trade receivables 1.787 1.844 Decrease/(increase) in other current assets (3.656) 681 Decrease/(increase) in inventories (2.281) (4.643) Increase/(decrease) in trade & other payables 2.112 (4.279) Increase/(decrease) in other current liabilities 1.369 (169) Other non-current assets and liabilities (458) (109) Total adjustments and changes 14.595 3.456 Net cash flow generated from operating activities (A) 44.326 37.072 CASH FLOW FROM INVESTING ACTIVITIES: Investments in intangible assets (54) (159) Investments in tangible assets (50.869) (31.616) Increase/(decrease) in fixed asset payables 14.392 (527) Investments (divestments) in financial assets --- (2) Sales price of property, plant and equipment 4.454 4.447 Net cash flow absorbed from investing activities (B) (32.077) (27.857) CASH FLOW FROM FINANCING ACTIVITIES: Interest paid in the year (3.107) (2.766) Interest received in the year 873 961 Net change in short-term bank borrowings (3.779) 12.132 New medium/long-term loans 74.001 3.500 Repayments of medium/long-term loans (10.538) (6.471) Dividends (19.047) (21.645) Net cash flow from financing activities Change in balance sheet accounts translation effect Net change in cash and cash equivalents (C) 38.403 (14.289) (D) (145) (36) (A+B+C+D) 50.507 (5.110) Cash available at beginning of the year 39.272 44.382 Cash available at end of the year 89.779 39.272 (*) Figures restated in accordance with requirements of IFRS 11 Joint Arrangements and IAS 28 Interests in associates and joint ventures. 11
Share capital Legal reserve Revaluation reserve Other reserves Capital paid-in Treasury shares Translation reserve Actuarial gains/(losses) on defined benefit plans Retained earnings Net Profit Total Group Consolidated Net Equity Total Minority interest Consolidated Net Equity Zignago Vetro Group Statement of Changes in Shareholders Equity (unaudited) ATTACHMENT 7 B a l. a t De c. 3 1, 2 0 12 8, 8 0 0 1, 6 0 0 2 7, 3 3 4 6, 2 7 0 15 7 (5, 0 2 7 ) (4 7 7 ) (3 5 1) 5 6, 2 8 9 3 0, 8 8 3 12 5, 4 7 8 --- Consolidate d ne t profit --- --- --- --- --- --- --- --- --- 26,134 26,134 --- Othe r profits/(losse s), ne t of tax e ffe c t --- --- --- --- --- --- (220) (122) --- --- (342) --- Tota l c ompre he nsive profit (loss) --- --- --- --- --- --- (220) (122) --- 26,134 25,792 --- Othe r a lloc a tions of the re sult --- 160 --- --- --- --- --- --- 30,723 (30,883) --- --- Divide nds --- --- --- --- --- --- --- --- (21,645) --- (21,645) --- Othe r ne t e quity c hange s --- --- --- --- --- --- --- --- (6) --- (6) --- B a l. a t De c. 3 1, 2 0 13 8, 8 0 0 1, 7 6 0 2 7, 3 3 4 6, 2 7 0 15 7 (5, 0 2 7 ) (6 9 7 ) (4 7 3 ) 6 5, 3 6 1 2 6, 13 4 12 9, 6 19 --- Consolidate d ne t profit --- --- --- --- --- --- --- --- --- 23,838 23,838 --- Othe r profits/(losse s), ne t of tax e ffe c t --- --- --- --- --- --- (404) (230) --- --- (634) --- Tota l c ompre he nsive profit (loss) --- --- --- --- --- --- (404) (230) --- 23,838 23,204 --- Othe r a lloc a tions of the re sult --- --- --- --- --- --- --- --- 26,134 (26,134) --- --- Divide nds --- --- --- --- --- --- --- --- (19,047) --- (19,047) --- Othe r ne t e quity c hange s --- --- --- --- --- --- --- --- (10) --- (10) --- B a l. a t De c. 3 1, 2 0 14 8, 8 0 0 1, 7 6 0 2 7, 3 3 4 6, 2 7 0 15 7 (5, 0 2 7 ) (1, 10 1) (7 0 3 ) 7 2, 4 3 8 2 3, 8 3 8 13 3, 7 6 6 --- 12