LUXEMBOURG, July 25, 2019 /PRNewswire/ -- Ardagh Group S.A.
(NYSE: ARD) today announced its results for the second quarter
ended June 30, 2019.
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June 30,
2019
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June 30,
2018
|
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Change
|
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Change
CCY
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($m except per
share data)
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|
Revenue
|
|
2,268
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2,347
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(3%)
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1%
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Adjusted EBITDA
1
|
|
395
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|
392
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|
1%
|
|
5%
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Adjusted EBITDA
margin
|
|
17.4%
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|
16.7%
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|
70 bps
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Earnings per
share
|
|
0.29
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0.25
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16%
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|
21%
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Adjusted earnings per
share 1
|
|
0.48
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0.51
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(6%)
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(4%)
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Profit for the
period
|
|
69
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|
58
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Adjusted free cash
flow 1
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(50)
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43
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Dividend per share
declared 2
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0.14
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0.14
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Paul Coulson, Chairman and Chief
Executive, said "Our second quarter performance was in line with
our expectations, led by strong performances in our Metal Packaging
Americas and Glass Packaging Europe divisions. The recently
announced combination of our Metal Packaging Food & Specialty
business with Exal to form Trivium Packaging, a new global leader
in metal packaging owned by Ontario Teachers' and Ardagh, is an
important strategic step for the Group."
- Revenue of $2,268 million
increased by 1% on a constant currency basis;
- Adjusted EBITDA of $395 million
increased by 5% at constant exchange rates;
- Earnings per share for the quarter of $0.29, an increase of 16%;
- Adjusted earnings per share of $0.48 (2018: $0.51);
- Adjusted EBITDA growth in three of four segments, led by Metal
Packaging Americas and Glass Packaging Europe. Cost reductions
offset lower volumes in Glass Packaging North America, while Metal
Packaging Europe was impacted by increased input costs;
- Global beverage can volume growth of 1% with volume/mix growth
of 6%;
- Metal Packaging Food & Specialty ("Food & Specialty")
to combine with Exal Corporation to form Trivium Packaging
("Trivium"), a new global leader in metal packaging jointly owned
with Ontario Teachers'. Ardagh will hold a 43% stake in Trivium and
will receive cash proceeds of $2,500
million, to be used for debt reduction at Ardagh Group S.A.
The transaction is expected to close in the fourth quarter of
2019;
- Full year 2019 outlook3 re-iterated, with third
quarter Adjusted EBITDA of $410-$420
million
Summary Financial Information
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Three months ended
June 30,
|
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Six months ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
(in $ millions,
except EPS, ratios and percentages)
|
Revenue
|
|
2,268
|
|
2,347
|
|
4,488
|
|
4,571
|
Profit for the
period
|
|
69
|
|
58
|
|
82
|
|
43
|
Adjusted profit for
the period 4
|
|
114
|
|
120
|
|
197
|
|
199
|
Adjusted EBITDA
4
|
|
395
|
|
392
|
|
758
|
|
740
|
Adjusted EBITDA
margin
|
|
17.4%
|
|
16.7%
|
|
16.9%
|
|
16.2%
|
Earnings per
share
|
|
0.29
|
|
0.25
|
|
0.35
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|
0.18
|
Adjusted earnings per
share 4
|
|
0.48
|
|
0.51
|
|
0.83
|
|
0.84
|
|
|
|
|
|
|
|
|
|
Cash generated from
operations
|
|
268
|
|
338
|
|
358
|
|
332
|
Operating cash flow
4
|
|
101
|
|
204
|
|
(15)
|
|
55
|
Adjusted free cash
flow 4
|
|
(50)
|
|
43
|
|
(263)
|
|
(199)
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|
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At June
30,
|
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At December
31,
|
|
|
2019
|
|
2018
|
|
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$m
|
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$m
|
Net debt
5
|
|
8,190
|
|
7,462
|
Cash and available
liquidity
|
|
876
|
|
1,170
|
Net debt to LTM Pro
Forma EBITDA *
|
|
5.3x
|
|
N/A
|
Supplemental Pro
Forma Non-GAAP Information
* Net debt to LTM Pro
Forma EBITDA has been presented as Supplemental Pro Forma Non-GAAP
information in order to reflect the impact of IFRS 16, Leases,
following its adoption effective January 1, 2019, for the six
months ended December 31, 2018. The LTM Adjusted EBITDA on a
reported basis, excluding the effects of IFRS 16 for the six months
ended December 31, 2018 was $1,496 million and the corresponding
net debt to LTM Adjusted EBITDA was 5.5x (December 31, 2018:
5.0x).
|
Financial
Performance Review
Bridge of 2018 to
2019 Revenue and Adjusted EBITDA
Three months ended
June 30, 2019
|
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Metal
Packaging
Europe
|
|
Metal
Packaging
Americas
|
|
Glass
Packaging
Europe
|
|
Glass
Packaging
North
America
|
|
Group
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Revenue
2018
|
|
929
|
|
541
|
|
419
|
|
458
|
|
2,347
|
Organic
|
|
9
|
|
8
|
|
21
|
|
(25)
|
|
13
|
FX
translation
|
|
(64)
|
|
—
|
|
(28)
|
|
—
|
|
(92)
|
Revenue
2019
|
|
874
|
|
549
|
|
412
|
|
433
|
|
2,268
|
|
|
|
|
|
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|
|
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|
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|
Metal
Packaging
Europe
|
|
Metal
Packaging
Americas
|
|
Glass
Packaging
Europe
|
|
Glass
Packaging
North
America
|
|
Group
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Adjusted EBITDA
2018
|
|
157
|
|
74
|
|
91
|
|
70
|
|
392
|
Organic
|
|
(15)
|
|
7
|
|
8
|
|
(5)
|
|
(5)
|
IFRS 16
|
|
8
|
|
2
|
|
6
|
|
8
|
|
24
|
FX
translation
|
|
(10)
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|
—
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|
(6)
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|
—
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|
(16)
|
Adjusted EBITDA
2019
|
|
140
|
|
83
|
|
99
|
|
73
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|
395
|
|
|
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|
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Adjusted EBITDA
2019 margin
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16.0%
|
|
15.1%
|
|
24.0%
|
|
16.9%
|
|
17.4%
|
Adjusted EBITDA
2018 margin
|
|
16.9%
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|
13.7%
|
|
21.7%
|
|
15.3%
|
|
16.7%
|
|
|
|
|
|
|
|
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|
Six months ended
June 30, 2019
|
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|
|
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|
|
|
|
|
|
|
Metal
Packaging
Europe
|
|
Metal
Packaging
Americas
|
|
Glass
Packaging
Europe
|
|
Glass
Packaging
North
America
|
|
Group
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Revenue
2018
|
|
1,814
|
|
1,070
|
|
816
|
|
871
|
|
4,571
|
Organic
|
|
52
|
|
18
|
|
42
|
|
(22)
|
|
90
|
FX
translation
|
|
(119)
|
|
—
|
|
(54)
|
|
—
|
|
(173)
|
Revenue
2019
|
|
1,747
|
|
1,088
|
|
804
|
|
849
|
|
4,488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Metal
Packaging
Europe
|
|
Metal
Packaging
Americas
|
|
Glass
Packaging
Europe
|
|
Glass
Packaging
North
America
|
|
Group
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Adjusted EBITDA
2018
|
|
291
|
|
137
|
|
171
|
|
141
|
|
740
|
Organic
|
|
(8)
|
|
8
|
|
14
|
|
(13)
|
|
1
|
IFRS 16
|
|
17
|
|
4
|
|
10
|
|
16
|
|
47
|
FX
translation
|
|
(19)
|
|
—
|
|
(11)
|
|
—
|
|
(30)
|
Adjusted EBITDA
2019
|
|
281
|
|
149
|
|
184
|
|
144
|
|
758
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
2019 margin
|
|
16.1%
|
|
13.7%
|
|
22.9%
|
|
17.0%
|
|
16.9%
|
Adjusted EBITDA
2018 margin
|
|
16.0%
|
|
12.8%
|
|
21.0%
|
|
16.2%
|
|
16.2%
|
Group
Revenue of $2,268 million
decreased by 3% in the three-month period ended June 30, 2019, compared with the same period last
year. On a constant currency basis, revenue increased by 1%, mainly
due to the pass through of increased input costs, partly offset by
lower volumes in Glass Packaging North America.
Second quarter Adjusted EBITDA of $395
million increased by 1% at actual exchange rates, compared
with the same period last year. On a constant currency basis,
Adjusted EBITDA increased by 5%, principally due to increased
selling prices, including for the pass through of higher input
costs, the impact of IFRS 16 of $24
million, and favorable volume/mix effects, partly offset by
higher other operating costs.
Metal Packaging Europe
Revenue of $874 million decreased
by 6% in the three-month period ended June
30, 2019, compared with the same period last year. On a
constant currency basis, revenue increased by 1%, principally due
to volume/mix growth and the pass through of higher input
costs. Adjusted EBITDA for the quarter of $140 million decreased by 11% at actual exchange
rates and 5% at constant currency rates, compared with the same
period last year. The reduction in Adjusted EBITDA principally
reflected higher input and other operating costs, as well as some
adverse weather impact on beverage can volumes, partly offset by
the $8 million impact of IFRS 16 and
favorable volume/mix effects.
Metal Packaging Americas
Revenue increased by 1% to $549 million in the second
quarter of 2019, compared with the same period last year. This was
principally due to favorable volume/mix effects of 4%, as growth in
beverage cans was partly offset by the impact of a plant closure in
food & specialty in late-2018, as well as the pass through of
lower input costs. Adjusted EBITDA of $83
million increased by 12% compared with the prior year,
principally reflecting favorable volume/mix effects and the impact
of IFRS 16, partly offset by higher operating costs.
Glass Packaging Europe
Revenue of $412 million decreased
by 2% at actual exchange rates and increased by 5% at constant
exchange rates, in the three-month period ended June 30, 2019, compared with the same period last
year. Revenue growth principally reflected favorable mix, increased
engineering activity and higher selling prices to recover increased
input costs. Adjusted EBITDA for the quarter of
$99 million increased by 16% at constant exchange rates,
compared with the same period last year, mainly due to favorable
mix effects, the impact of IFRS 16 and higher selling prices.
Glass Packaging North America
Revenue decreased by 5% to $433 million in the second
quarter, compared with the same period last year, principally
reflecting lower volume/mix. Adjusted EBITDA for the quarter of
$73 million increased by 4%, compared with the same period
last year, mainly due to cost savings from the Group's capacity
realignment initiatives, the impact of IFRS 16 and higher selling
prices to recover increased costs, partly offset by unfavorable
volume/mix.
Combination of Food & Specialty with Exal
On July 15, 2019, the Group
announced that it had entered into an agreement to combine its Food
& Specialty Metal Packaging business, operating as part of the
Metal Packaging Europe and Metal Packaging Americas segments, with
the business of Exal, a leading producer of aluminum containers, to
form Trivium, a global leader in metal packaging.
The combination of Food & Specialty with Exal, currently
controlled by Ontario Teachers' Pension Plan Board ("Ontario
Teachers"), will create one of the largest metal packaging
companies in the world. Trivium will be headquartered in
the Netherlands and will operate
57 production facilities, principally across Europe and the Americas, employing
approximately 7,800 people.
Trivium will serve a diverse range of leading multinational,
regional and local customers operating in a wide array of end
markets, including food, seafood, pet food, nutrition, beauty and
personal care, household care and premium beverages.
This complementary transaction will combine Food &
Specialty's leading presence in Europe and North
America, principally focused on tin-plate steel packaging,
with Exal's leadership in Americas aluminum aerosol packaging.
Trivium will produce an extensive and sustainable product range,
backed by dedicated research and development resources,
underpinning the businesses' reputation for customer service,
quality and innovation.
Upon completion of the transaction, Ardagh will hold
approximately a 43 per cent stake in Trivium, with 57 per cent
controlled by Ontario Teachers'. Ardagh will also receive
approximately $2,500 million in cash
proceeds.
Upon completion, Ardagh intends to use the $2,500 million in cash proceeds from this
transaction as follows:
a) Repay outstanding drawings
under Ardagh's current asset-backed loan facility (and permanently
reduce commitments) by $150
million;
b) Consider, based on the
circumstances around the time of the completion date, closing
derivative positions of approximately $5 to $10 million
in out-of-the-money swaps;
c) Exercise the optional
redemption provisions, at the applicable redemption premium, of
Ardagh's existing 4.625% Senior Secured Notes due 2023 and 4.125%
Senior Secured Notes due 2023, for total consideration of
approximately $1,550 million;
d) Undertake an excess proceeds
offer (as defined in the relevant indentures) of the 4.250% Senior
Secured Notes due 2022 and 2.750% Senior Secured Notes due 2024 at
par on a pro rata basis; and
e) To the extent any proceeds
remain, call Ardagh's existing 6.750% Senior Notes due 2024.
Completion of the transaction is subject to the satisfaction of
customary closing conditions, including receipt of regulatory
approvals and confirmation of the participation of certain Ardagh
European entities in the transaction, which remains subject to
works councils' consultation. Completion is also subject to closing
of the debt financing announced by Trivium on July 15, 2019 and subsequently priced on
July 19, 2019. The transaction is
expected to close in the fourth quarter of 2019.
On July 19, 2019, Trivium
Packaging Finance BV, a wholly-owned subsidiary of Trivium, priced
an offering of $2,850 million in
senior secured and senior notes, due 2026 and 2027 respectively, at
a blended interest rate of approximately 4.8% after swaps.
Organisational Changes
As part of its long-term succession planning, Ardagh Group is
making the following organisational changes:
Shaun Murphy will join Ardagh as
Chief Operating Officer on September 16,
2019, reporting to Paul
Coulson, Chairman and CEO. He will also join the board of
Ardagh. Shaun, who is aged 52, recently completed
a highly successful six-year term as Managing Partner of KPMG
in Ireland. KPMG
Ireland, which is the country's
largest professional services firm, employs over 3,000 people
serving a wide range of domestic and multinational clients with a
broad range of advisory services. Shaun has been a partner at KPMG
for almost 20 years and served as the Lead Director on KPMG's
Global Board from 2015 until earlier this year.
Johan Gorter has decided to
retire as CEO of Glass by the end of 2019. Following Johan's
retirement, Martin Petersson (CEO
Glass Europe) and Bertrand Paulet
(CEO Glass North America) will report to Shaun Murphy.
Following the recent agreement to combine Ardagh's Food and
Specialty business with Exal to form Trivium Packaging,
David Wall has decided to step down
as CEO of Ardagh's Metal Division by the end of 2019. Oliver Graham (CEO Metal Beverage
Europe/Brazil and Group Commercial
Director) and Claude Marbach (CEO
Metal Beverage North America) will then report to Shaun Murphy.
Earnings Webcast and Conference Call Details
Ardagh Group S.A. (NYSE: ARD) will hold its second quarter 2019
earnings webcast and conference call for investors at 3 p.m. BST (10 a.m.
ET) on July 25, 2019. Please
use the following webcast link to register for this call:
Webcast registration and access:
https://event.on24.com/wcc/r/2034962-1/B6EA3E16E08DF3D6A8A64873C2F3906F?partnerref=rss-events
Conference call dial in:
United States: +1855 85
70686
International: +44 33 3300 0804
Participant pin code: 63132553#
Slides and quarterly report
Supplemental slides to accompany this release are available at
http://www.ardaghgroup.com/investors.
Second quarter results for ARD Finance S.A., issuer of the
Senior Secured Toggle Notes due 2023, are available at
http://www.ardholdings-sa.com/.
About Ardagh Group
Ardagh Group is a global supplier of infinitely recyclable,
metal and glass packaging for the world's leading brands. Ardagh
operates more than 100 metal and glass production facilities in 22
countries across five continents, employing over 23,000 people with
sales of $9bn.
Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of Section 27A of the U.S. Securities Act and
Section 21E of the U.S. Securities Exchange Act of 1934, as
amended. Forward-looking statements are subject to known and
unknown risks and uncertainties, many of which may be beyond our
control. We caution you that the forward-looking information
presented in this press release is not a guarantee of future
events, and that actual events may differ materially from those
made in or suggested by the forward-looking information contained
in this press release. Any forward-looking information presented
herein is made only as of the date of this press release, and we do
not undertake any obligation to update or revise any
forward-looking information to reflect changes in assumptions, the
occurrence of unanticipated events, or otherwise.
Non-GAAP Financial Measures
This press release may contain certain consolidated financial
measures such as Adjusted EBITDA, LTM Pro Forma EBITDA, working
capital, operating cash flow, Adjusted free cash flow, net debt,
Adjusted profit/(loss), Adjusted earnings/(loss) per share, and
ratios relating thereto that are not calculated in accordance with
IFRS or US GAAP. Non-GAAP financial measures may be considered in
addition to GAAP financial information, but should not be used as
substitutes for the corresponding GAAP measures. The non-GAAP
financial measures used by Ardagh may differ from, and not be
comparable to, similarly titled measures used by other
companies.
Consolidated
Interim Financial Statements
Consolidated
Interim Income Statement for the three months ended June 30.
2019
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
Three months ended
June 30, 2019
|
|
Three months ended
June 30, 2018
|
|
|
Before
|
|
|
|
|
|
|
Before
|
|
|
|
|
|
|
|
exceptional
|
|
Exceptional
|
|
|
|
|
exceptional
|
|
Exceptional
|
|
|
|
|
|
items
|
|
Items
|
|
Total
|
|
items
|
|
Items
|
|
Total
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Revenue
|
|
2,268
|
|
—
|
|
|
2,268
|
|
2,347
|
|
—
|
|
|
2,347
|
Cost of
sales
|
|
(1,896)
|
|
15
|
|
|
(1,881)
|
|
(1,968)
|
|
(17)
|
|
|
(1,985)
|
Gross
profit
|
|
372
|
|
15
|
|
|
387
|
|
379
|
|
(17)
|
|
|
362
|
Sales, general and
administration expenses
|
|
(103)
|
|
(19)
|
|
|
(122)
|
|
(99)
|
|
(4)
|
|
|
(103)
|
Intangible
amortization
|
|
(66)
|
|
—
|
|
|
(66)
|
|
(67)
|
|
—
|
|
|
(67)
|
Operating
profit
|
|
203
|
|
(4)
|
|
|
199
|
|
213
|
|
(21)
|
|
|
192
|
Net finance
expense
|
|
(111)
|
|
—
|
|
|
(111)
|
|
(103)
|
|
—
|
|
|
(103)
|
Profit before
tax
|
|
92
|
|
(4)
|
|
|
88
|
|
110
|
|
(21)
|
|
|
89
|
Income tax
charge
|
|
(29)
|
|
10
|
|
|
(19)
|
|
(34)
|
|
3
|
|
|
(31)
|
Profit for the
period
|
|
63
|
|
6
|
|
|
69
|
|
76
|
|
(18)
|
|
|
58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable
to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
holders
|
|
|
|
|
|
|
69
|
|
|
|
|
|
|
58
|
Non-controlling
interests
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
Profit for the
period
|
|
|
|
|
|
|
69
|
|
|
|
|
|
|
58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted earnings per share attributable to equity
holders
|
|
|
|
|
|
|
$0.29
|
|
|
|
|
|
|
$0.25
|
Consolidated
Interim Income Statement for the six months ended June 30.
2019
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
Six months ended
June 30, 2019
|
|
Six months ended
June 30, 2018
|
|
|
Before
|
|
|
|
|
|
|
Before
|
|
|
|
|
|
|
|
exceptional
|
|
Exceptional
|
|
|
|
|
exceptional
|
|
Exceptional
|
|
|
|
|
|
items
|
|
Items
|
|
Total
|
|
items
|
|
Items
|
|
Total
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Revenue
|
|
4,488
|
|
—
|
|
|
4,488
|
|
4,571
|
|
—
|
|
|
4,571
|
Cost of
sales
|
|
(3,765)
|
|
4
|
|
|
(3,761)
|
|
(3,840)
|
|
(65)
|
|
|
(3,905)
|
Gross
profit
|
|
723
|
|
4
|
|
|
727
|
|
731
|
|
(65)
|
|
|
666
|
Sales, general and
administration expenses
|
|
(219)
|
|
(21)
|
|
|
(240)
|
|
(217)
|
|
(10)
|
|
|
(227)
|
Intangible
amortization
|
|
(131)
|
|
—
|
|
|
(131)
|
|
(134)
|
|
—
|
|
|
(134)
|
Operating
profit
|
|
373
|
|
(17)
|
|
|
356
|
|
380
|
|
(75)
|
|
|
305
|
Net finance
expense
|
|
(246)
|
|
—
|
|
|
(246)
|
|
(229)
|
|
—
|
|
|
(229)
|
Profit before
tax
|
|
127
|
|
(17)
|
|
|
110
|
|
151
|
|
(75)
|
|
|
76
|
Income tax
charge
|
|
(41)
|
|
13
|
|
|
(28)
|
|
(48)
|
|
15
|
|
|
(33)
|
Profit for the
period
|
|
86
|
|
(4)
|
|
|
82
|
|
103
|
|
(60)
|
|
|
43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable
to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
holders
|
|
|
|
|
|
|
82
|
|
|
|
|
|
|
43
|
Non-controlling
interests
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
Profit for the
period
|
|
|
|
|
|
|
82
|
|
|
|
|
|
|
43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted earnings per share attributable to equity
holders
|
|
|
|
|
|
|
$0.35
|
|
|
|
|
|
|
$0.18
|
Consolidated
Interim Statement of Financial Position
|
|
|
Unaudited
|
|
Audited
|
|
At June
30,
|
|
At December
31,
|
|
2019
|
|
2018
|
|
$m
|
|
$m
|
|
|
|
|
Non-current
assets
|
|
|
|
Intangible
assets
|
3,475
|
|
3,601
|
Property, plant and
equipment
|
3,805
|
|
3,388
|
Derivative financial
instruments
|
19
|
|
11
|
Deferred tax
assets
|
262
|
|
254
|
Other non-current
assets
|
73
|
|
24
|
|
7,634
|
|
7,278
|
Current
assets
|
|
|
|
Inventories
|
1,382
|
|
1,284
|
Trade and other
receivables
|
1,238
|
|
1,053
|
Contract
asset
|
192
|
|
160
|
Derivative financial
instruments
|
15
|
|
9
|
Cash and cash
equivalents
|
374
|
|
530
|
|
3,201
|
|
3,036
|
TOTAL
ASSETS
|
10,835
|
|
10,314
|
|
|
|
|
Equity
attributable to owners of the parent
|
|
|
|
Issued
capital
|
23
|
|
23
|
Share
premium
|
1,292
|
|
1,292
|
Capital
contribution
|
485
|
|
485
|
Other
reserves
|
84
|
|
45
|
Retained
earnings
|
(3,447)
|
|
(3,355)
|
|
(1,563)
|
|
(1,510)
|
Non-controlling
interests
|
1
|
|
1
|
TOTAL
EQUITY
|
(1,562)
|
|
(1,509)
|
Non-current
liabilities
|
|
|
|
Borrowings
|
7,741
|
|
7,729
|
Lease
obligations
|
369
|
|
32
|
Employee benefit
obligations
|
984
|
|
957
|
Derivative financial
instruments
|
74
|
|
107
|
Deferred tax
liabilities
|
516
|
|
543
|
Provisions
|
35
|
|
38
|
|
9,719
|
|
9,406
|
Current
liabilities
|
|
|
|
Borrowings
|
329
|
|
114
|
Lease
obligations
|
73
|
|
4
|
Interest
payable
|
80
|
|
81
|
Derivative financial
instruments
|
18
|
|
38
|
Trade and other
payables
|
1,992
|
|
1,983
|
Income tax
payable
|
109
|
|
114
|
Provisions
|
77
|
|
83
|
|
2,678
|
|
2,417
|
TOTAL
LIABILITIES
|
12,397
|
|
11,823
|
TOTAL EQUITY and
LIABILITIES
|
10,835
|
|
10,314
|
Consolidated
Interim Statement of Cash Flows
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
Three months ended
ended June 30,
|
|
Six months ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Cash generated from
operations
|
|
268
|
|
338
|
|
358
|
|
332
|
Interest
paid
|
|
(129)
|
|
(139)
|
|
(210)
|
|
(207)
|
Income tax
paid
|
|
(22)
|
|
(22)
|
|
(38)
|
|
(47)
|
Net cash from
operating activities
|
|
117
|
|
177
|
|
110
|
|
78
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
Purchase of property,
plant and equipment
|
|
(150)
|
|
(143)
|
|
(335)
|
|
(306)
|
Purchase of software
and other intangibles
|
|
(7)
|
|
(10)
|
|
(16)
|
|
(15)
|
Proceeds from
disposal of property, plant and equipment
|
|
3
|
|
2
|
|
3
|
|
4
|
Net cash used
in investing activities
|
|
(154)
|
|
(151)
|
|
(348)
|
|
(317)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
Repayment of
borrowings
|
|
(1)
|
|
(1)
|
|
(3)
|
|
(2)
|
Proceeds from
borrowings
|
|
47
|
|
—
|
|
217
|
|
—
|
Dividends
paid
|
|
(33)
|
|
(33)
|
|
(66)
|
|
(66)
|
Consideration paid on
extinguishment of derivative financial instruments
|
|
—
|
|
—
|
|
(14)
|
|
—
|
Deferred debt issue
costs paid
|
|
—
|
|
(4)
|
|
(2)
|
|
(5)
|
Lease
payments
|
|
(25)
|
|
(1)
|
|
(46)
|
|
(2)
|
Net cash
(outflow)/inflow from financing activities
|
|
(12)
|
|
(39)
|
|
86
|
|
(75)
|
|
|
|
|
|
|
|
|
|
Net decrease in
cash and cash equivalents
|
|
(49)
|
|
(13)
|
|
(152)
|
|
(314)
|
Cash and cash
equivalents at the beginning of the period
|
|
416
|
|
493
|
|
530
|
|
784
|
Exchange
gains/(losses) on cash and cash equivalents
|
|
7
|
|
(15)
|
|
(4)
|
|
(5)
|
Cash and cash
equivalents at the end of the period
|
|
374
|
|
465
|
|
374
|
|
465
|
Financial assets
and liabilities
|
|
At June 30, 2019, the
Group's net debt and available liquidity was as follows:
|
|
|
|
|
|
Maximum
|
|
Final
|
|
|
|
|
|
|
|
|
|
|
|
|
amount
|
|
maturity
|
|
Facility
|
|
|
|
|
|
Undrawn
|
Facility
|
|
Currency
|
|
drawable
|
|
date
|
|
type
|
|
Amount drawn
|
|
amount
|
|
|
|
|
Local
|
|
|
|
|
|
Local
|
|
$m
|
|
$m
|
|
|
|
|
currency
|
|
|
|
|
|
currency
|
|
|
|
|
|
|
|
|
m
|
|
|
|
|
|
m
|
|
|
|
|
2.750% Senior Secured
Notes
|
|
EUR
|
|
750
|
|
15-Mar-24
|
|
Bullet
|
|
750
|
|
853
|
|
—
|
4.625% Senior Secured
Notes
|
|
USD
|
|
1,000
|
|
15-May-23
|
|
Bullet
|
|
1,000
|
|
1,000
|
|
—
|
4.125% Senior Secured
Notes
|
|
EUR
|
|
440
|
|
15-May-23
|
|
Bullet
|
|
440
|
|
501
|
|
—
|
4.250% Senior Secured
Notes
|
|
USD
|
|
715
|
|
15-Sep-22
|
|
Bullet
|
|
715
|
|
715
|
|
—
|
4.750% Senior
Notes
|
|
GBP
|
|
400
|
|
15-Jul-27
|
|
Bullet
|
|
400
|
|
508
|
|
—
|
6.000% Senior
Notes
|
|
USD
|
|
1,700
|
|
15-Feb-25
|
|
Bullet
|
|
1,700
|
|
1,708
|
|
—
|
7.250% Senior
Notes
|
|
USD
|
|
1,650
|
|
15-May-24
|
|
Bullet
|
|
1,650
|
|
1,650
|
|
—
|
6.750% Senior
Notes
|
|
EUR
|
|
750
|
|
15-May-24
|
|
Bullet
|
|
750
|
|
853
|
|
—
|
Global Asset Based
Loan Facility
|
|
USD
|
|
818
|
|
07-Dec-22
|
|
Revolving
|
|
317
|
|
317
|
|
501
|
Lease
Obligations
|
|
USD/GBP/EUR
|
|
|
|
|
|
Amortizing
|
|
|
|
442
|
|
—
|
Other
borrowings/credit lines
|
|
EUR/USD
|
|
|
|
Rolling
|
|
Amortizing
|
|
|
|
12
|
|
1
|
Total borrowings /
undrawn facilities
|
|
|
|
|
|
|
|
|
|
|
|
8,559
|
|
502
|
Deferred debt issue
costs and bond premium
|
|
|
|
|
|
|
|
|
|
|
|
(47)
|
|
—
|
Net borrowings /
undrawn facilities
|
|
|
|
|
|
|
|
|
|
|
|
8,512
|
|
502
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
|
|
|
|
(374)
|
|
374
|
Derivative financial
instruments used to
hedge foreign currency and interest rate risk
|
|
|
|
|
|
|
|
|
|
|
|
52
|
|
—
|
Net debt /
available liquidity
|
|
|
|
|
|
|
|
|
|
|
|
8,190
|
|
876
|
Reconciliation of
profit for the period to Adjusted profit
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Profit for the
period
|
|
69
|
|
58
|
|
82
|
|
43
|
Total exceptional
items 6
|
|
4
|
|
21
|
|
17
|
|
75
|
Tax credit associated
with exceptional items
|
|
(10)
|
|
(3)
|
|
(13)
|
|
(15)
|
Intangible
amortization
|
|
66
|
|
67
|
|
131
|
|
134
|
Tax credit associated
with intangible amortization
|
|
(13)
|
|
(15)
|
|
(27)
|
|
(30)
|
(Gains)/loss on
derivative financial instruments
|
|
(2)
|
|
(8)
|
|
7
|
|
(8)
|
Adjusted profit
for the period
|
|
114
|
|
120
|
|
197
|
|
199
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares
|
|
236.36
|
|
236.35
|
|
236.36
|
|
236.35
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
0.29
|
|
0.25
|
|
0.35
|
|
0.18
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
per share
|
|
0.48
|
|
0.51
|
|
0.83
|
|
0.84
|
Reconciliation of
profit for the period to Adjusted EBITDA, cash generated from
operations,
operating cash flow and Adjusted free cash flow
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
$m
|
|
$m
|
|
$m
|
|
$m
|
Profit for the
period
|
|
69
|
|
58
|
|
82
|
|
43
|
Income tax
charge
|
|
19
|
|
31
|
|
28
|
|
33
|
Net finance
expense
|
|
111
|
|
103
|
|
246
|
|
229
|
Depreciation and
amortization
|
|
192
|
|
179
|
|
385
|
|
360
|
Exceptional operating
items
|
|
4
|
|
21
|
|
17
|
|
75
|
Adjusted
EBITDA
|
|
395
|
|
392
|
|
758
|
|
740
|
Movement in working
capital
|
|
(106)
|
|
(24)
|
|
(368)
|
|
(350)
|
Transaction-related,
start-up and other exceptional costs paid
|
|
(12)
|
|
(17)
|
|
(19)
|
|
(40)
|
Exceptional
restructuring paid
|
|
(9)
|
|
(13)
|
|
(13)
|
|
(18)
|
Cash generated
from operations
|
|
268
|
|
338
|
|
358
|
|
332
|
Transaction-related,
start-up and other exceptional costs paid
|
|
12
|
|
17
|
|
19
|
|
40
|
Capital expenditure
7
|
|
(154)
|
|
(151)
|
|
(348)
|
|
(317)
|
Lease payments due to
the adoption of IFRS 16
|
|
(25)
|
|
—
|
|
(44)
|
|
—
|
Operating cash
flow
|
|
101
|
|
204
|
|
(15)
|
|
55
|
Interest
|
|
(129)
|
|
(139)
|
|
(210)
|
|
(207)
|
Income tax
paid
|
|
(22)
|
|
(22)
|
|
(38)
|
|
(47)
|
Adjusted free cash
flow
|
|
(50)
|
|
43
|
|
(263)
|
|
(199)
|
1. A reconciliation
to the most comparable GAAP measures can be found at the back of
this release.
|
|
2. Payable on August
30, 2019 to shareholders of record on August 16, 2019.
|
|
3. 2019
Adjusted EBITDA of at least $1.5 billion, before divestment of Food
and Specialty to Trivium.
Pro Forma for divestment,
Adjusted EBITDA of at least $1.15 billion.
|
|
4. A reconciliation
to the most comparable GAAP measures can be found at the back of
this release.
|
|
5. Net debt is
comprised of net borrowings and derivative financial instruments
used to hedge foreign currency and interest rate risk, net of cash
and cash equivalents. Net borrowings at June 30, 2019 includes the
impact of IFRS 16 leases.
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6. Total exceptional
items before tax for the three months ended June 30, 2019 of $4
million include $7 million related to the Group's capacity
realignment programs comprising restructuring costs ($2 million),
property, plant and equipment impairment charges ($2 million) and
start-up related costs ($3 million). These costs were incurred in
Glass Packaging North America ($3 million) and Metal Packaging
Europe ($4 million). Total exceptional items for the three months
ended June 30, 2019 also include a $37 million pension service
credit recognized in Glass Packaging North America, $15 million
related to a provision for a court award and related interest, net
of the tax adjusted indemnity receivable in respect of the Group's
U.S. glass business legal matter and $19 million
transaction-related costs, primarily related to the combination of
the Group's Food & Specialty Metal Packaging business with the
business of Exal Corporation.
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Total exceptional
items before tax for the six months ended June 30, 2019 of $17
million include $18 million related to the Group's capacity
realignment programs comprising restructuring costs ($10 million),
property, plant and equipment impairment charges ($4 million) and
start-up related costs ($4 million). These costs were incurred in
Glass Packaging North America ($11 million) and Metal Packaging
Europe ($7 million). Total exceptional items for the six months
ended June 30, 2019 also include a $37 million pension service
credit recognized in Glass Packaging North America, $15 million
related to a provision for a court award and related interest, net
of the tax adjusted indemnity receivable in respect of the Group's
U.S. glass business legal matter and $21 million
transaction-related costs, primarily related to the combination of
the Group's Food & Specialty Metal Packaging business with the
business of Exal Corporation.
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7. Capital
expenditure for the three and six months ended June 30, 2019,
includes $17 million and $49 million respectively, relating to
spend on short payback projects.
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SOURCE Ardagh Group S.A.