Lacroix Group: First semester 2019-2020. Activity remains stable
and EBITDA resilient, despite the impact of the health crisis.
First semester 2019-2020Activity remains stable
and EBITDA resilient, despite the impact of the health crisis
LACROIX Group (LACR
- FR0000066607), an international technological equipment
manufacturer, presents its results for the first half of 2019-2020
(period from 1 October 2019 to 31 March 2020). These results have
undergone a limited review by the statutory auditors.
|
HY1 2018-2019 |
HY1 2019-2020 |
Revenue |
239.0 |
238.7 |
EBITDA (1) |
12.1 |
12.3 |
As % of revenue |
5.1% |
5.2% |
Operating profit |
8.1 |
6.3 |
As % of revenue |
3.4% |
2.6% |
Operating profit |
7.3 |
6.2 |
Net financial income |
(0.2) |
(0.5) |
Taxes and duties |
(1.8) |
(2.4) |
Net income - group
share |
5.2 |
2.9 |
(1) EBITDA corresponds to recurring
operating income plus depreciations on tangible and intangible
fixed assets (including, where applicable, on those recognised
under a business combination), and the IFRS 2 “share-based payment”
(non-cash) expense
A solid growth trajectory interrupted in
March
In respect of the first half-year 2019-2020 (1
October 2019 to 31 March 2020), LACROIX Group recorded turnover of
€238.7 M, remaining stable compared to the same period in financial
year 2018-2019. At constant scope, the business shows a downturn of
3.6%.
After an increase of 7.6% for the first quarter
and a growth trajectory superior to 6% for January-February, fully
in line with expectations, the health crisis has led to a
significant and rapid downturn in business from March onwards.
This impact is reflected in the evolution of
revenue for the second quarter, which is in decline by 7.5% in
comparison to the same period 2018-2019. The Group therefore
estimates business losses in relation to this exceptional crisis at
about €17 m by the end of March.
Over the semester, LACROIX Electronics records
turnover for €155.8 m, a drop of 4.3%. After growth at the start of
the period, reflecting the resumption of activity in Poland and the
return to normal operating conditions in Tunisia, the second
quarter shows a drop in turnover of 12.9%, integrating total or
partial site closures imposed by lockdown and lower order volumes,
particularly in the avionics and automotive sectors.
For LACROIX City, activity is holding up better
with half-year turnover slipping by 2.3% (-3.5% at a constant
scope) to €48.9, including a second quarter in decline by
3.2%.
Finally, for LACROIX Environment, half-year
turnover amounts to €33.9 m, an increase of 30.1% as a result
of the integration of SAE-IT Systems purchased in February 2019. At
constant scope, growth for this activity emerges at 1.6% for the
entire semester.
In response to this unprecedented situation,
rapid measures, as detailed in the communications of 25 March and
12 May 2020, were taken to protect staff safety and to ensure, as
much as possible, continuity of business for clients. Among these
measures, we recall the partial or complete closure of all the
Group’s industrial sites in France and abroad, in Tunisia.
Decisions were also made in order to secure
funding and limit the impact on cash flow: cost reduction efforts,
partial unemployment, deferral of social security contributions and
bank repayments.
All these measures were taken with a concern not
to sacrifice the Group’s ability to bounce back. The R&D work
plan has been upheld. And with regard to the Symbiose project for
the construction of a future electronics factory in France,
the timetable for opening in late 2021 remains valid.
Results automatically penalised by the
sharp downturn in activity
As expected, the sharp downturn in activity has
had an automatic effect on the results for the period.
EBITDA remains good at €12.3 M compared to €12.1
M in the first half-year 2018-2019, representing 5.2% of turnover,
and benefiting in particular from the first application of IFRS 16
on 31/03/2020.
Recurring operating income, on the other hand,
slipped to €6.3 M, against €8.1 M in the first half-year 2018-2019.
This development is logically explained by an expenses structure in
place to support the dynamic of growth suddenly interrupted by the
impact of the crisis on all activities. As such, despite the
initial effects of the measures taken in response to this
exceptional context (holidays, short-time working), staff costs
represent 27.2% of revenue for the half-year as opposed to 25.8%
for the same period in 2018-2019. In addition to proactive
organisational strengthening, the development of staff costs in the
half-year also reflects the integration of SAE-IT Systems teams
over six months, as opposed to two months in the first half-year
2018-2019 (€2.3 M) and the impact of the employee shareholding
scheme implemented in February 2020 (€0.5 M).
In the LACROIX Electronics activity, recurring
operating income comes to €1.9 M, as opposed to €4.3 M in the first
half-year 2018-2019. LACROIX City recorded a negative recurring
operating income of €2.4 M, against a loss of €2.0 M compared to
the same period in 2018-2019. Finally, despite the exceptional
context, LACROIX Environment continued its excellent performance,
with recurring operating income of around €8.6 M (25% of turnover)
compared to €6.7 M in the first half-year 2018-2019, an increase of
28.7%. This development benefits from the contribution of SAE-IT
Systems over 6 months (as opposed to 2 months in 2019) which
continues to show double-digit operating profitability.
In total, operating income comes to €6.3 M, as
opposed to €8.1 M in the first half-year 2018-2019. After
taking account of financial income and tax, the Group share of net
income stands at €2.9 M, against €5.2 M for the first half-year
2019.
New objectives for the financial
period
In response to the exceptional impact of the
crisis and reduced visibility, as of March the Group had suspended
its objectives for the current financial period, the final year of
its 2016-2020 strategic plan.
Since the gradual reopening of all its
industrial sites, the Group has observed encouraging signs of the
resumption of its activities. In this way, whereas turnover slipped
by more than 60% in the month of April, the decline in activity
amounted to - 40% in the month of May. In view of these factors,
and despite still significant uncertainties, a gradual improvement
in activity during the coming months can now be envisaged. The
return to a normalised situation is not however expected before the
end of 2020.
Under these conditions, the Group anticipates a
drop of around 10% in its revenue for the whole financial year,
with a recurring operating margin of over 2%.
Renewed confidence in the
future
Beyond the current financial period, LACROIX
Group holds renewed confidence in its ability to quickly regain its
performance trajectory.
This confidence is built upon strong
fundamentals and the benefits of the far-reaching transformation
initiated in recent years:
- Three activities central to the new technological needs of
industry and managers of critical infrastructure in roads, energy
and the environment.
- A solid and diverse client base.
- A strengthened competitive position and a significant portfolio
of onboard orders, with recent acquisitions of new clients and new
projects which will support future growth.
- A solid financial situation (€30 M cash at the end of March,
unused medium-term credit lines of €4.5 M) enabling us to get
through the crisis and to seize new acquisition opportunities in
the future, something which the Group has continued to actively
monitor. This situation has been further strengthened by obtaining
a loan guaranteed by the state (PGE) for an amount of €18.5 M,
concluded on 24 June.
Drawing on these strengths, all the teams at
LACROIX Group stand ready to work on a new strategic plan.
Proposal to change the closure date to
31 December
LACROIX Group will propose, at the Extraordinary
General Meeting on 28 August, a change of the closure date of its
financial year, bringing it from 30 September to 31 December. If
this proposal were to be approved, the current financial year would
therefore have an exceptional duration of 15 months, from 1 October
2019 to 31 December 2020.
Traditionally, the Group’s activity was
concentrated mainly on public clients who, at the time, could have
significant seasonality effects, making 31 December rather
unsuitable as the annual account closure date. The portfolio has
since changed greatly and an alignment of closure dates with key
clients would enable a higher quality of exchanges and budgetary
preparation. With regard to investors, this change would also
enable a better analysis of the Group’s performance compared to
comparable companies, and would facilitate legibility of the
timetable for communications and periodical announcements. Finally,
this modification would provide the Group with an additional
three-month post-COVID hold-off period in which to refine its
recovery prospects and consolidate preparation of the new 2020-2025
strategic plan, which would then be presented in April 2021.
ABOUT LACROIX Group
LACROIX Group is an international technological
equipment manufacturer, aiming to serve a connected and responsible
world with its technical and industrial excellence. As a
listed family-run SME, LACROIX Group combines the essential agility
required to innovate in an ever-changing technological sector with
the industrial capacity to produce robust, secure equipment and the
long-term vision to invest and build for the future.
LACROIX Group designs and manufactures
electronics equipment for its clients’ products, particularly in
the automotive, home-automation, avionics, industrial and
healthcare fields. LACROIX Group also provides safe, connected
equipment for the management of critical infrastructures such as
smart roads (street lighting, traffic signs, traffic management,
V2X) and the management and operation of water and energy
systems.
Drawing on its extensive experience and
expertise, the Group works with its customers and partners to build
the connection between the world of today and the world of
tomorrow. It helps them to build the industry of the future and to
make the most of the opportunities for innovation that surround
them, supplying them with the equipment for a smarter
world.
Contacts
LACROIX GroupCOO & Executive Vice-President
Finance Nicolas Bedouininfo@lacroix-group.comTel.:
+33 (0)2 40 92 58 56 |
ACTIFINPress relationsJennifer
Jullia jjullia@actifin.frTel.: +33 1 56 88 11
19 |
ACTIFINFinancial communicationStéphane
Ruizsruiz@actifin.frTel.: 01 56 88 11 15 |
- LXGroup_press_release_06302020
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