Elis: Full-year 2023 results
Elis delivers a record financial
performance in 2023
Numerous industrial and commercial
successes
Acceleration of Group
deleveraging
Elis’ 2023 operational and financial
performance confirms the relevance of the Group’s strategy and its
business model
- Revenue of
€4,309.4m (+12.8%, of which +11.8% organic)
- Adjusted EBITDA up
+17.1% to €1,474.8m (margin up +130bps at 34.2%)
- Adjusted EBIT up
+25.6% to €683.1m (margin up +160bps at 15.9%)
- Headline net income
per share up +22.4% to €1.86 (+18.4% at €1.70 on a fully diluted
basis)
- Pre-tax ROCE up
+230bps to 13.9%
- Free cash flow up
+35.0% to €303.6m
- Financial leverage
ratio at 2.0x at December 31, 2023, vs. 2.5x at December 31,
2022
- Long-term credit
rating upgraded to “BBB-“ Investment Grade by S&P Global
Ratings
Numerous commercial successes in
workwear and good pricing momentum
- Further outsourcing
trend in workwear: new contract signings in 2023 are up c. +14%
yoy
- Satisfactory
activity in our four end-markets
- Very favorable
pricing momentum in all our markets on the back of adjustments
implemented to offset inflation: price effect was c. +9% over the
year, in line with inflation of our cost base
- Strong pricing
discipline for tenders or contract renewals, resulting in a
moderate increase in churn
Improvement of profitability indicators,
record free cash flow and acceleration of Group
deleveraging
- Improvement of
industrial performance and significant productivity gains,
especially on logistics and energy consumption
- All geographies
delivered higher 2023 adjusted EBITDA margin, above 30%
- Record 2023 free
cash flow and acceleration of Group deleveraging: financial
leverage ratio down 0.5x at December 31, 2023 to 2.0x
- Proposed cash
dividend of €0.43 per share for the 2023 financial year, up c. +5%
compared to the 2022 dividend
Acceleration of the deployment of CSR
strategy
- Improvement of
Elis’ non-financial ratings, rewarding its CSR strategy
- Climate roadmap
presented in September 2023 with 2030 targets in line with The
Paris Agreement and validated by SBTi
- Good progress
towards Group’s 2025 objectives and towards emission reduction
(scopes 1, 2 and 3)
- Group DNA at the
heart of its “raison d’être”: “To deliver circular services at work
for hygiene, well-being and protection – everywhere, every day, in
a sustainable way.”
2024 outlook: Another year of profitable
growth for Elis; further Group deleveraging
- Full-year organic
revenue growth expected at c. +5%
- Adjusted EBITDA
margin expected up close to 35%
- Adjusted EBIT
margin expected stable yoy at c. 16%
- Headline net income
per share expected above €1.75 on a fully diluted basis
- Free cash flow
expected at c. €340m
- Financial leverage
ratio as of December 31, 2024 expected down 0.2x compared to
December 31, 2023
Saint-Cloud, 7 March 2024 –
Elis, the global leader in circular services at work, today
announces its 2023 full-year results. The accounts have been
approved by the Management Board and examined by the Supervisory
Board on March 6, 2024. They have been audited and the auditors
issued a report without any qualification.
Commenting on the announcement, Xavier
Martiré, Chairman of the Management Board of Elis,
said:
“In 2023, Elis delivered a record level for
almost all its financial aggregates.
In a context still marked by strong inflation,
revenue growth largely benefited from price adjustments implemented
to offset the increase of our cost base.
Commercial momentum was strong, especially in
workwear, where the outsourcing trend is moving ahead in many
industries. From an industrial standpoint, further optimization of
production processes in all geographies led to significant
productivity gains over the year, notably regarding logistics and
resource consumption.
These operational achievements led to
outstanding financial results, with a strong increase in revenue
along with improved EBITDA margin and EBIT margin and higher
headline net income. Free cash flow was up + 35% and reached a
record level of 304 million euros, enabling the acceleration of the
Group’s deleveraging: the financial leverage ratio improved 0.5x,
to 2.0x at December 31, 2023.
These excellent results enable us to propose at
the next shareholders’ meeting the payment of a dividend in cash of
0.43 euros per share, up c. +5% year on year.
We entered 2024 with confidence: visibility is
good, both in terms of revenue and costs. 2024 should therefore be
another year of profitable growth for Elis, with organic revenue
growth expected at c. +5% along with further improvement of EBITDA
margin, headline net income per share and free cash flow.
Elis has also decided to invest for the future
by significantly strengthening its salesforce. In all geographies,
sales teams are being expanded to accelerate the Group’s services
deployment and support further growth.
In 2023, Elis continued its initiatives linked
to the circular economy and the recycling of its textiles. In
September 2023, the Group announced ambitious targets to reduce its
emissions, aligned with the objectives of the Paris Agreement.
Finally, M&A activity should be
significantly more intense in 2024 than it was last year; we
anticipate a noticeable recovery of acquisitions of small or
mid-size targets. The attractive multiples paid for these
acquisitions and Elis’ proven track record in quickly generating
synergies will enable us to also continue deleveraging the Group:
we anticipate a -0.2x decrease of the financial leverage ratio in
2024.
The great resilience that Elis demonstrated
through the various recent crises, its operational know-how, its
strengthened organic growth and its model based on the principles
of the circular economy are major assets that will enable the Group
to continue to assert its leadership in all the countries in which
it operates.”
I. 2023 annual results
Full-year 2023 reported growth breakdown
In millions of
euros |
2023 |
2022 |
Organic growth |
External growth |
FX |
Reported growth |
France |
1,311.6 |
1,185.0 |
+ 10.7% |
- |
- |
+10.7% |
Central Europe |
1,013.4 |
870.0 |
+15.1% |
+0.7% |
+0.7% |
+16.5% |
Scandinavia &
East. Eur. |
599.2 |
580.7 |
+8.5% |
+0.3% |
-5.5% |
+3.2% |
UK &
Ireland |
534.9 |
476.5 |
+14.0% |
- |
-1.8% |
+12.3% |
Latin America |
444.9 |
347.3 |
+10.4% |
+16.3% |
+1.3% |
+28.1% |
Southern
Europe |
379.2 |
330.5 |
+13.6% |
+1.1% |
- |
+14.7% |
Others |
26.1 |
30.8 |
-14.0% |
- |
-1.0% |
-15.0% |
Total |
4,309.4 |
3,820.9 |
+11.8% |
+1.8% |
-0.8% |
+12.8% |
« Others » includes Manufacturing Entities and
Holdings. Percentage change calculations are based on actual
figures.
2023 organic growth breakdown
|
Q1 |
Q2 |
H1 |
Q3 |
Q4 |
H2 |
France |
+15.8% |
+11.6% |
+13.5% |
+8.8% |
+7.4% |
+8.1% |
Central Europe |
+21.4% |
+16.7% |
+18.9% |
+12.3% |
+10.9% |
+11.6% |
Scandinavia &
East. Eur. |
+15.8% |
+7.4% |
+11.5% |
+5.0% |
+6.4% |
+5.7% |
UK &
Ireland |
+23.9% |
+13.9% |
+18.5% |
+11.6% |
+8.5% |
+10.1% |
Latin America |
+12.6% |
+9.5% |
+10.9% |
+10.9% |
+9.4% |
+10.1% |
Southern
Europe |
+24.7% |
+15.4% |
+19.4% |
+10.3% |
+7.1% |
+8.8% |
Others |
-15.4% |
+6.6% |
-4.4% |
-20.3% |
-22.5% |
-21.4% |
Total |
+18.3% |
+12.5% |
+15.2% |
+9.5% |
+8.1% |
+8.8% |
« Others » includes Manufacturing Entities and
Holdings. Percentage change calculations are based on actual
figures.
As announced on January 30, 2024, Elis delivered
record full-year 2023 revenue of 4,309.4 million euros, up +12.8%
year-on-year. It was driven by the adjustments implemented since
2022 to offset inflation, with a price effect of 9% on average in
2023, and by many commercial successes in workwear, where the
outsourcing trend continued, notably in Southern Europe and in
Latin America.
In France, revenue was up
+10.7% (entirely organic). Pricing dynamic was good, driven by the
adjustments implemented since 2022 to offset cost inflation. We
continued to record many contract wins in workwear and pest
control. However, we noticed a slight slowdown in the activity of
our small clients, notably for non-essential services. In
Hospitality, the comparable base was favorable in Q1. Activity then
remained stable compared to 2022.
In Central Europe, revenue was
up +16.5% (+15.1% on an organic basis). Commercial momentum was
satisfactory, notably in Germany and in the Netherlands, the
region’s main countries, where further outsourcing led to new
contract signings in workwear. Germany delivered organic revenue
growth of +c. 17%: most of our pricing adjustments negotiated in
2022 to offset strong inflation (mainly wages) were implemented at
the beginning of 2023. However, the Group’s pricing discipline led
to some contract losses in several countries, notably in Germany
(Healthcare).
In Scandinavia & Eastern
Europe, revenue was up +3.2% (+8.5% on an organic basis),
with an FX impact of -5.5%, mainly due to the evolution of the
Swedish Krona and the Norwegian Krone. Organic revenue growth was
driven by pricing adjustments and commercial dynamism in workwear
(including Cleanroom). Hospitality activity was satisfactory.
In the UK & Ireland,
revenue was up +12.3% (+14.0% on an organic basis), with a negative
FX impact of -1.8% year-on-year. The region’s pricing dynamic was
good. Healthcare activity remained very solid. In Industry and
Trade & Services, we recorded new contract signings thanks to
continuous commercial efforts, but client activity was impacted by
the deteriorating macro environment in the UK. Finally, our pricing
discipline led to some volume losses in Hospitality.
In Latin America, revenue was
up +28.1% (+10.4% on an organic basis). Acquisitions contributed
+16.3% to the growth in the region. Our Mexican acquisition,
consolidated since July 1, 2022, delivered double-digit organic
growth in H2. This acquisition significatively strengthens our
growth profile in the region. In addition, we saw further
outsourcing trends in all the countries of the region, and we
continued to record contract wins, notably in Healthcare. Contract
losses were very limited despite a pricing effect above the
inflation level throughout the year.
In Southern Europe, revenue was
up +14.7% (+13.6% on an organic basis), driven by good pricing
dynamic. In workwear, the outsourcing trend continued to be solid,
and we recorded many new contract signings, notably with
food-processing companies. Activity in Hospitality continued to
rebound and returned to pre-Covid levels. The acquisitions of
Gruppo Indaco in Italy and Levante in Spain create local platforms
to boost the development of pest control in the region. These
acquisitions contributed +1.1% to the region’s annual growth.
Adjusted EBITDA
In millions of
euros |
2023reported |
2022restated* |
Var. 23/22 |
|
H1 |
H2 |
Total |
H1 |
H2 |
Total |
H1 |
H2 |
Total |
France |
250.4 |
279.3 |
529.8 |
209.7 |
246.5 |
456.2 |
+19.4% |
+13.3% |
+16.1% |
As of % of
revenue |
39.0% |
41.5% |
40.3% |
37.0% |
39.6% |
38.4% |
+190bps |
+200bps |
+190bps |
Central Europe |
147.3 |
163.6 |
310.9 |
121.5 |
137.5 |
259.0 |
+21.2% |
+19.0% |
+20.0% |
As of % of
revenue |
29.5% |
31.6% |
30.5% |
29.4% |
29.8% |
29.6% |
= |
+180bps |
+90bps |
Scandinavia &
East. Eur. |
106.5 |
112.0 |
218.5 |
100.7 |
109.5 |
210.2 |
+5.7% |
+2.3% |
+3.9% |
As of % of
revenue |
35.5% |
37.5% |
36.5% |
35.9% |
36.4% |
36.2% |
-50bps |
+100bps |
+30bps |
UK &
Ireland |
76.5 |
87.9 |
164.4 |
67.4 |
75.8 |
143.2 |
+13.6% |
+15.9% |
+14.8% |
As of % of
revenue |
29.7% |
31.7% |
30.7% |
30.0% |
30.0% |
30.0% |
-30bps |
+160bps |
+70bps |
Latin America |
73.6 |
79.4 |
153.0 |
45.6 |
70.8 |
116.4 |
+61.1% |
+12.2% |
+31.4% |
As of % of
revenue |
34.4% |
34.4% |
34.4% |
32.4% |
34.3% |
33.5% |
+200bps |
+10bps |
+90bps |
Southern
Europe |
53.0 |
64.1 |
117.1 |
39.4 |
50.7 |
90.1 |
+34.6% |
+26.5% |
+30.0% |
As of % of
revenue |
29.4% |
32.1% |
30.8% |
26.2% |
28.1% |
27.2% |
+320bps |
+400bps |
+360bps |
Others |
(9.1) |
(9.8) |
(18.9) |
(7.9) |
(7.6) |
(15.5) |
-15.2% |
-28.6% |
-21.8% |
Total |
698.1 |
776.7 |
1,474.8 |
576.4 |
683.2 |
1,259.6 |
+21.1% |
+13.7% |
+17.1% |
As of % of
revenue |
33.2% |
35.2% |
34.2% |
32.3% |
33.5% |
33.0% |
+90bps |
+160bps |
+130bps |
* : Please refer to the « Restated
income statement for prior financial years » section of this
release. Margin rates and percentage change calculations are based
on actual figures.« Others » includes Manufacturing
Entities and Holdings.
In 2023, Group adjusted EBITDA was up + 17.1%
year-on-year to 1,474.8 million euros; adjusted EBITDA margin was
up +130bps.
In France, logistics savings
and the optimization of our industrial processes led to a +190bps
improvement in adjusted EBITDA margin, to 40.3%.
In Central Europe, adjusted
EBITDA margin was up +90bps compared to 2022, at 30.5%. The
progressive implementation of pricing adjustments as well as
productivity savings, notably in logistics, enabled to offset the
strong inflation in the region, especially in Germany.
In Scandinavia & Eastern
Europe, adjusted EBITDA margin was up +30bps compared to
2022, at 36.5%. Despite strong inflation and occasionally tough
pricing negotiations with clients from the public healthcare
sector, the optimization of logistics costs and energy consumption
led to margin improvement.
In the UK & Ireland,
adjusted EBITDA margin was up +70bps compared to 2022, at 30.7%, on
the back of good control of logistics costs and improved workshop
productivity.
In Latin America, adjusted
EBITDA margin was up +90bps compared to 2022, at 34.4%, driven by
the integration of the Mexican operations as well as productivity
savings in the region’s other countries.
In Southern Europe, strong
revenue increase and productivity savings led to a +360bps
improvement in adjusted EBITDA margin, at 30.8%.
From adjusted EBITDA to net income
In millions of
euros |
2023 reported |
2022restated* |
Var. 23/22 |
Adjusted
EBITDA |
1,474.8 |
1,259.6 |
+17.1% |
As of % of
revenue |
34.2% |
33.0% |
+130bps |
D&A |
(791.7) |
(715.9) |
|
Adjusted EBIT |
683.1 |
543.7 |
+25.6% |
As of % of
revenue |
15.9% |
14.2% |
+160bps |
Miscellaneous
financial items |
(1.6) |
(1.7) |
|
Expenses related to
share-based payments |
(31.1) |
(22.3) |
|
Amortization of
intangible assets recognized in a business combination |
(85.1) |
(82.9) |
|
Other operating
income and expenses |
(67.9) |
(9.0) |
|
Goodwill
impairment |
- |
(58.7) |
|
Operating
income |
497.5 |
369.0 |
+34.8% |
Net financial
income (expense) |
(124.6) |
(86.7) |
|
Tax |
(110.4) |
(79.7) |
|
Income from
continuing operations |
262.4 |
202.6 |
+29.5% |
Net income |
262.4 |
202.6 |
+29.5% |
Headline net
income1 |
433.4 |
351.3 |
+23.4% |
* : Please refer to the « Restated
income statement for prior financial years » section of this
release.1 : A reconciliation is provided in the « Net
income to headline to headline net income » section of this
release. Margin rates and percentage change calculations are based
on actual figures.
Adjusted EBIT and ROCE
In 2023, adjusted EBIT was up +25.6% compared to
2022, at 683.1 million euros. Adjusted EBIT margin was up +160bps
to 15.9%, supported by the limited evolution of D&A over the
year (c. +10.5%). 2023 is the last year to benefit from lower
D&A compared to normative levels, correlated with linen
investments that were also lower than normative level during the
pandemic (2020 and 2021).
Pre-tax ROCE, defined as adjusted EBIT divided
by capital employed at the beginning of the period, stood at 13.9%
in 2023, compared to 11.6% in 2022.
The calculation of capital employed is provided
in the “Capital employed” section of this release.
Operating income
The main items between adjusted EBIT and
Operating income are as follows:
- Expenses related to
share-based payments correspond to the requirements of the IFRS 2
accounting standard. They increased compared to 2022, at 31.1
million euros as a result of the share price increase over the last
3 years.
- Amortization of
intangible assets linked with past acquisitions are relatively
stable as it mostly results from the acquisition of Berendsen in
2017.
- Other operating
income and expenses strongly increased due to the reevaluation of
the earn-out of the acquisition in Mexico in 2022: the financial
outlook of the acquired group has been revised upwards twice (in H1
2023 and in H2 2023) given its performance.
Net financial result
In 2023, net financial result represented a
charge up 37.9 million euros. This change is due to the increase in
interest charges linked to the 2022 and 2023 refinancings with
interest rates higher than in the previous years (c. 20 million
euros), an accretion expense resulting from the earn-out of the
Mexican acquisition in 2022 (c. 12 million euros) and a negative FX
impact (c. 6 million euros).
Net income
Net income increased by 59.8 million euros, from
202.6 million euros in 2022 to 262.4 million euros in 2023 for the
reasons explained above.
Net income to headline net income
In millions of
euros |
2023 reported |
2022 restated* |
Var. 23/22 |
Net income |
262.4 |
202.6 |
+29.5% |
Amortization of
intangible assets recognized in a business combination1 |
65.0 |
63.4 |
|
Goodwill
impairment |
- |
58.7 |
|
IFRS 2
expense1 |
28.9 |
21.5 |
|
Accretion expense
linked to the earn-out of the Mexican acquisition |
12.4 |
- |
|
Accelerated
amortization of loans issuing costs1 |
- |
0.3 |
|
Exceptional gains /
losses linked to refinancing operations1 |
- |
(2.2) |
|
Non-current
operating income and expenses1 |
64.6 |
7.0 |
|
Headline net
income |
433.4 |
351.3 |
+23.4% |
Non-controlling
interests |
(0.0) |
0.0 |
|
Headline net income
attributable to owners of the parent (A) |
433.4 |
351.3 |
+23.4% |
Convertible related
interests (B) |
15.6 |
9.6 |
|
Headline net income
attributable to owners of the parent, adjusted for the dilution
effect |
449.0 |
360.9 |
+24.4% |
Share count – basic
(C) |
233.1 |
231.3 |
|
Share count – fully
diluted (D) |
263.5 |
250.8 |
|
Headline net income
per share (in euros): |
|
|
|
- basic,
attributable to owners of the parent = A/C |
1.86 |
1.52 |
+22.4% |
- diluted,
attributable to owners of the parent = (A-B)/C |
1.70 |
1.44 |
+18.4% |
* : Please refer to the “Restated income
statement for prior financial years” section of this
release.1 : Net of tax effect.
Headline net income was 433.4 million euros in
2023, up +23.4% compared to 2022. Headline net income per share was
up +22.4% to 1.86 euros (up +18.4% to 1.70 euros on a fully diluted
basis).
Cash flow statement
In millions of
euros |
2023 reported |
2022 restated* |
Adjusted
EBITDA |
1,474.8 |
1,259.6 |
Non-recurring items
and provision variance |
(13.7) |
(9.7) |
Acquisition and
cession fees |
(1.5) |
(4.4) |
Other |
(1.6) |
(1.7) |
Cash flows before
net financial costs and tax |
1,457.9 |
1,243.8 |
Net capex |
(820.8) |
(691.9) |
Change in working
capital requirement |
(5.9) |
(52.6) |
Net interest paid
(including interest on lease liabilities) |
(90.2) |
(72.9) |
Tax paid |
(126.4) |
(100.1) |
Lease liabilities
payments (principal) |
(111.0) |
(101.5) |
Free cash flow |
303.6 |
224.9 |
Acquisitions of
subsidiaries, net of cash
acquired |
(82.2) |
(221.7) |
Other change
arising from subsidiaries (gain or loss of
control) |
(4.4) |
(22.7) |
Other flows related
to financing
operations |
(1.4) |
(3.4) |
Dividends
paid |
(61.7) |
(33.2) |
Equity increase,
treasury
shares |
9.0 |
4.5 |
Other |
(10.5) |
17.4 |
Net financial debt
decrease (increase) |
152.5 |
(34.2) |
Net financial
debt |
3,025.5 |
3,178.0 |
* : A reconciliation is provided in the
“Restated income statement for prior financial years” section of
this release.
Net capex
In 2023, the Group’s net capex represented 19.0%
of revenue, compared to 18.1% in 2022, resulting from the
implementation of new contracts in workwear. In value, net capex
was up c. +128.8 million euros.
Change in working capital requirements
In 2023, change in working capital requirement
was slightly negative at –5.9 million euros compared to -52.6
million euros last year, mainly due to the decrease of central
linen inventories and the good cash collection at year-end: despite
an unfavorable calendar effect, the average payment time at
December 31, 2023 was 55 days.
Free cash flow
In 2023, the Group delivered free cash flow of
303.6 million euros, up +35.0% compared to 2022. It reflects the
improvement in EBITDA coupled with the favorable evolution of
working capital requirement.
Net financial debt
The Group’s net financial debt at December 31,
2023 stood at 3,025.5 million euros compared to 3,178.0 million
euros at December 31, 2022 and 3,275.4 million euros at June 30,
2023. The financial leverage ratio was 2.0x at December 31, 2023
compared to 2.5x at December 31, 2022.
In July, the Group signed a new US$200 million
USPP financing (US private placement) with a group of US investors
led by Metlife Investment Management. The new notes have a 12-year
maturity (July 2035) and will offer investors a 6.03% coupon in US
dollars. The notes have been swapped to euros for a total amount of
183 million euros and Elis will pay a final 5.21% coupon in
euros.
In addition, Elis received the first proceeds
from its securitization program, whose maximum amount is 200
million euros with a 3 year-maturity.
Payout for the 2022 financial year
At the next Annual General Meeting of
shareholders on 23 May 2024, the Supervisory Board will propose the
payment of a dividend per share of €0.43 for the 2023 financial
year. This amount represents a c. +5% increase compared to the
dividend paid for the 2022 financial year.
2024 outlook
2024 organic revenue growth is expected at c.
+5%, with a price increase below the 2023 level, as a result of the
slowdown in inflation.
Elis decided to reinforce its sales force for
the future. In all geographies, sales teams have been expanded to
accelerate the Group’s services deployment to support further
growth. It represents a yearly additional cost of 20 million euros.
Despite this, 2024 adjusted EBITDA margin is expected at close to
35%, resulting from new productivity savings to be realized over
the year and our energy supply contracts, whose conditions are
fixed for almost the entire 2024 volumes.
2024 adjusted EBIT margin is expected to be
stable yoy at c. 16%. The improvement of the adjusted EBITDA margin
should be offset by the D&A normalization as a percentage of
revenue (2023 was the last year to benefit from a lower level of
D&A than usual, linked to capex which was also at a lower level
during the pandemic).
2024 headline net income per share is expected
above 1.75 euros (on a fully diluted basis, notably taking into
account the potential dilutive effect of the OCEANE bonds issued in
September 2022).
2024 free cash flow is expected at c. 340
million euros, driven by EBITDA increase and further normalization
of working capital requirement.
The financial leverage ratio at December 31,
2024, is expected to decrease by c. -0.2x over 2024.
II. CSR developments
The circular economy at the heart of Elis’ business
model
Elis offers its clients products that are
maintained, repaired, reused, and reemployed to optimize their
usage and lifespan. The Group therefore selects its textile
products based on sustainability criteria, to ensure frequent
washing, and also operates repair workshops. Elis’ conviction is
that the circular economy model, which notably aims at reducing
consumption of natural resources by optimizing the lifespan of
products, is a sustainable solution to address today’s
environmental challenges.
The Ellen MacArthur Foundation states that the
circular economy can significantly contribute to reaching Net Zero
and that nearly 9 billion tons of CO2eq (i.e. 20% of world
emissions) could be reduced thanks to the transition of just some
key industries from the current model towards a circular
economy.
Non-financial rating
Rating agencies |
MSCI |
Ecovadis |
CDP |
Sustainalytics |
Ethifinance ESG Rating |
Scores |
A |
75/100Gold |
A-Climate change |
ASupplier Engagement Leaderboard |
Low risk |
75/100Gold |
The Group’s CSR performance has been recognized
by non-financial rating agencies:
- In 2023, the MSCI
rating agency improved Elis’ ESG rating to A from BBB. It rewards
the Group commitment regarding CSR and its continuous
improvements,
- In 2023, Elis
obtained a Gold medal for the EcoVadis questionnaire, maintaining
its score of 75/100. This award confirms Elis’ commitment to its
clients, partners and employees, and places the Group within the
best-assessed companies in its sector. Elis’ CSR strategy fulfills
EcoVadis’ assessment criteria, which are based on international
standards and 4 CSR themes (Environment, Social & Human Rights,
Ethics and Sustainable Purchasing). This medal places Elis within
the top 5% of the c. 100,000 companies assessed by EcoVadis,
- In its last
assessment, the Group was also rated A by the CDP (Carbon
Disclosure Project), a non-profit organization which performs
independent assessments on the basis of information provided by
companies on their strategy, performance and commitment of
stakeholders on climate goals. This assessment places the Group in
the “Leadership” category and underlines its commitment and action
in the area of climate change. Furthermore, the Group was also
rated A by the CDP Supplier Engagement Leaderboard, which places
Elis in the top 8% of companies assessed for their climate-friendly
actions across value chain,
- Sustainalytics
maintained the Group rating as “low risk” concerning CSR,
- Finally, Elis
improved its score with rating agency Ethifinance ESG Rating
(ex-Gaia), to 75 from 73 previously, maintaining its “Gold”
level.
Our climate commitment: ambitious 2030 climate
targets
On September 4, 2023, Elis unveiled its climate
roadmap and related 2030 targets, underscoring its commitment to
contributing to a low-carbon society.
Elis’ ambition is to achieve the following
targets by 2030:
- Reduce absolute
scopes 1 and 2 GHG emissions by 47.5% by 2030 from a 2019 base
year1;
- Reduce absolute
scope 3 GHG emissions from purchased goods and services, fuel and
energy related activities, upstream transportation and
distribution, employee commuting, and end-of-life treatment of sold
products by 28% within the same timeframe.
These targets have been approved by the Science
Based Targets initiative (SBTi), an international reference and a
partnership between the United Nations Global Compact, the World
Resources Institute (WRI), the Carbon Disclosure Project (CDP) and
the World Wildlife Fund for Nature (WWF). They are fully in line
with the objectives of the 2015 Paris Climate Agreements to
contribute to restrict global warming to less than 1.5°C compared
to pre-industrial levels on scopes 1 and 2, and well below 2°C on
scope 3.
These climate targets mark a new step in Elis’
sustainability strategy and climate actions. The Group has worked
for many years to reduce its energy consumption and CO2eq
emissions.
At end-2023, the Group reported a 14.6% decrease
of CO2eq emissions on scopes 1 & 2 and a 3.6% decrease on scope
3 compared to 2019.
In December 2023, these 2030 targets have been
integrated to the calculation of the margin of the Group’s
900-million-euro Sustainability-Linked Revolving Credit
Facility.
Group performance towards its 2025
commitments
The Group is making progress on all its
objectives in 2023, underlining the daily commitment of its
teams.
In addition, in the last Group satisfaction
survey, 84% of employees questioned considered that Elis is
committed on CSR topics.
Strategic pillars |
Our 2025 commitments and objectives |
2023 checkpoint |
Circularity and Exemplarity to reduce our impact on the
planet |
Improve thermal energy efficiency of its European plants by 35%
between 2010 and 2025 |
-28% |
Accelerate the transition of its logistics fleet and target 650
alternative logistics vehicles by 2025 |
355 alternative logistics vehicles (vs. 134 in 2020) |
Reduce water consumption per kg of linen delivered by 50% between
2010 and 2025 in its European laundries |
-46% |
Reuse or recycle 80% of end-of-life textiles within the Group in
2025 |
77% (Mexico excluded) |
Propose at least one collection with sustainable materials for each
product family |
58% |
Empower our employees and offer them a brighter
future |
Reduce by 50% the frequency rate of accidents for Group employees
between 2019 and 2025 |
-11.4% |
Reach 40% of women in executive or managerial positions by 2025
(42% by 2030) |
35% |
Extend the “Chevrons” program within the Group |
352 “Chevrons” (+52% vs. 2018) |
Make a positive impact on society |
Triple the impact of the Elis Foundation by 2025 |
5th class in September |
Have 95% of purchasing expenses with direct providers surveyed
through a CSR inquiry in the past 3 years |
94.8% |
III. Other information
Restated income statement for prior financial
years
The table below presents the adjustments made
retrospectively linked to business combination (IFRS 3) on the
previously-published income statement as of December 31, 2022.
In millions of
euros |
2022 publié |
IFRS 3 |
2022retraité |
Revenue |
3,820.9 |
- |
3,820.9 |
Adjusted
EBITDA |
1,259.6 |
- |
1,259.6 |
D&A |
(715.9) |
- |
(715.9) |
Adjusted EBIT |
543.7 |
- |
543.7 |
Miscellaneous
financial items |
(1.7) |
- |
(1.7) |
Expenses related to
share-based payments |
(22.3) |
- |
(22.3) |
Amortization of
intangible assets recognized in a business combination |
(80.1) |
(2.8) |
(82.9) |
Other operating
income and expenses |
(9.0) |
- |
(9.0) |
Goodwill
impairment |
(58.7) |
- |
(58.7) |
Operating
income |
371.8 |
(2.8) |
369.0 |
Net financial
income (expense) |
(86.7) |
- |
(86.7) |
Tax |
(80.5) |
0.8 |
(79.7) |
Income from
continuing operations |
204.6 |
(2.0) |
202.6 |
Net income |
204.6 |
(2.0) |
202.6 |
Capital employed
The capital employed calculation excludes
intangible assets recognized in the Group’s last LBP for 1,537.0
million euros in 2023 and 1,537.7 million euros in 2022 (net of
deferred tax).
In millions of
euros |
As of January 1st, 2023 |
As of January 1st, 2022 |
TOTAL
ASSETS |
8,634.3 |
8,043.1 |
Employee benefit
assets |
(18.7) |
(51.8) |
Cash and cash
equivalents |
(286.1) |
(160.1) |
Intangible
assets recognized in the Group’s last LBO (net of deferred
tax) |
(1,537.0) |
(1,537.7) |
Subtotal
(I) |
6,792.4 |
6,293.4 |
TOTAL EQUITY AND
LIABILITIES |
8,634.3 |
8,043.1 |
EQUITY |
(3,212.3) |
(3,013.7) |
Employee benefit
liabilities |
(69.4) |
(105.9) |
Borrowings and
financial debts |
(3,034.9) |
(3,084.5) |
Bank overdrafts
and current borrowings |
(429.3) |
(219.5) |
Subtotal
(II) |
1,888.5 |
1,619.5 |
Capital employed
at the beginning of the period = (I)-(II) |
4,904.0 |
4,673.9 |
Financial definitions
- Organic growth in
the Group’s revenue is calculated excluding (i) the impacts of
changes in the scope of consolidation of “major acquisitions” and
“major disposals” (as defined in the Document de Base) in each of
the periods under comparison, as well as (ii) the impact of
exchange rate fluctuations.
- Adjusted EBITDA is
defined as adjusted EBIT before depreciation and amortization net
of the portion of grants transferred to income.
- Adjusted EBITDA
margin is defined as adjusted EBITDA divided by revenue.
- Adjusted EBIT is
defined as net income (loss) before net financial income (loss),
income tax, share in net income of equity accounted companies,
amortization of intangible assets recognized in a business
combination, goodwill impairment losses, other operating income and
expense, miscellaneous financial items (bank fees recognized in
operating income) and IFRS 2 expense (share-based payments).
- Adjusted EBIT
margin is defined as adjusted EBIT divided by revenue.
- Headline net result
corresponds to net income or loss excluding extraordinary items
which, due to their type and unusual nature, cannot be considered
as intrinsic to the Group’s current performance.
- Free cash flow is
defined as adjusted EBITDA less non-cash-items and changes in
working capital. purchases of linen, capital expenditures (net of
disposals), tax paid, financial interest paid and lease liabilities
payments.
- The financial
leverage ratio is the leverage ratio calculated for the purpose of
the financial covenant included in the banking agreement signed in
2021: Leverage ratio is equal to Net financial debt / adjusted
EBITDA, pro forma of acquisitions finalized during the last 12
months, and after synergies.
Geographical breakdown
- France
- Central Europe:
Austria, Belgium, Czech Republic, Germany, Hungary, Luxembourg,
Netherlands, Poland, Slovakia, Switzerland
- Scandinavia &
Eastern Europe: Denmark, Estonia, Finland, Latvia, Lithuania,
Norway, Russia, Sweden
- UK &
Ireland
- Latin America:
Brazil, Chile, Colombia, Mexico
- Southern Europe:
Italy, Portugal, Spain & Andorra
Presentation of 2023 full-year results (in
English)
Date: Thursday 7 March 2024 at 7:30 GMT (8:30 CET)
Speakers: Xavier Martiré, (Chairman of the Management Board) and
Louis Guyot (CFO)
Webcast link:https://edge.media-server.com/mmc/p/bdi8gh7n
Conference call & Q&A session
link:https://register.vevent.com/register/BI0ea1dfad5364461dadfcb67c0832b714
An investor presentation will be available at 7:00pm GMT (8:00pm
CET) at this
address:https://fr.elis.com/en/group/investor-relations/regulated-information
Disclaimer
This press release may include data information
and statements relating to estimates, future events, trends, plans,
expectations, objectives, outlook and other forward-looking
statements relating to the Group’s future business, financial
condition, results of operations, performance and strategy as they
relate to climate objectives, financial targets and other goals set
forth therein. Forward-looking statements are not statements of
historical fact and may contain the terms “may”, “will”, “should”,
“continue”, “aims”, “estimates”, “projects”, “believes”, “intends”,
“expects”, “plans”, “seeks” or “anticipates” or words of similar
meaning. In addition, the term “ambition” expresses an outcome
desired by the Group, it being specified that the means to be
deployed do not depend solely on the Group. Such forward-looking
information and statements have not been audited by the statutory
auditors. They are based on data, assumptions and estimates that
the Group considers as reasonable as of the date of this press
release and, by nature, involve known and unknown risks and
uncertainties. These data, assumptions and estimates may change or
be adjusted as a result of uncertainties, many of which are outside
the control of the Group, relating particularly to the economic,
financial, competitive, regulatory or tax environment or as a
result of other factors of which the Group is not aware on the date
of this press release. In addition, the materialization of certain
risks, especially those described in chapter 4 “Risk management and
internal control” of the Universal Registration Document for the
financial year ended December 31, 2022, which is available on
Elis’s website (www.elis.com), may have an impact on the Group’s
business, financial condition, results of operations, performance,
and strategy, notably with respect to these climate-related
objectives, financial objectives or other objectives included in
this press release. Therefore, the actual achievement of
climate-related objectives, financial targets and other goals set
forth in this press release may prove to be inaccurate in the
future or may differ materially from those expressed or implied in
such forward-looking statements. The Group makes no representation
and gives no warranty regarding the achievement of any climate
objectives, targets and other goals set forth in this press
release. Therefore, undue reliance should not be placed on such
information and statements.
This press release and the information included
therein were prepared on the basis of data made available to the
Group as of the date of this press release. Unless stated otherwise
in this press release, this press release and the information
included therein are accurate only as of such date. The Group
assumes no obligation to update or revise any of these
forward-looking statements, whether to reflect new information,
future events or circumstances or otherwise, except as required by
applicable laws and regulations.
This press release includes certain
non-financial metrics, as well as other non-financial data, all of
which are subject to measurement uncertainties resulting from
limitations inherent in the nature and the methods used to
determine them. These data generally have no standardized meaning
and may not be comparable to similarly labelled measures used by
other companies. The Group reserves the right to amend, adjust
and/or restate the data included in this press release, from time
to time, without notice and without explanation. The data included
in this press release may be further updated, amended, revised or
discontinued in subsequent publications, presentations and/or press
releases of Elis, depending on, among other things, the
availability, fairness, adequacy, accuracy, reasonableness or
completeness of the information, or changes in applicable
circumstances, including changes in applicable laws and
regulations.
This press release may include or refer to
information obtained from or established on the basis of various
third-party sources. Such information may not have been reviewed,
and/or independently verified, by the Group and the Group does not
approve or endorse such information by including them or referring
to them. Accordingly, the Group does not guarantee the fairness,
adequacy, accuracy, reasonableness or completeness of such
information, and no representation, warranty or undertaking,
express or implied, is made or responsibility or liability is
accepted by the Group as to the fairness, adequacy, accuracy,
reasonableness or completeness of such information, and the Group
shall not be obliged to update or revise such information.
The climate-related data and the climate-related
objectives included in this press release were neither audited nor
subject to a limited review by the statutory auditors of the
Group.
Next information
- Q1 2024 revenue:
Monday 6 May 2024 (after market)
- AGM: Thursday 23
May 2024 at 3:00 pm CET - Maison des Travaux Publics - 3, rue de
Berri - 75008 Paris
IV. Contact
Nicolas BuronDirector of Investor Relations,
Financing and TreasuryPhone: + 33 (0)1 75 49 98 30 -
nicolas.buron@elis.com
Charline LefaucheuxInvestor RelationsPhone: +
33 (0)1 75 49 98 15 - charline.lefaucheux@elis.com
Excerpt from condensed consolidated financial
statements
Consolidated income statement
(In millions of
euros) |
2023 |
2022 |
|
|
restated* |
Revenue |
4,309.4 |
3,820.9 |
Cost of linen,
equipment and other consumables |
(629.4) |
(575.0) |
Processing
costs |
(1,637.3) |
(1,491.3) |
Distribution
costs |
(626.6) |
(585.5) |
Gross margin |
1,416.1 |
1,169.1 |
Selling, general
and administrative expenses |
(763.6) |
(655.1) |
Net impairment on
trade and other receivables |
(2.1) |
5.7 |
Amortization of
intangible assets recognized in a business combination |
(85.1) |
(82.9) |
Other operating
income and expenses |
(67.9) |
(9.0) |
Goodwill
impairment |
0.0 |
(58.7) |
Operating income |
497.5 |
369.0 |
Net financial
income (expense) |
(124.6) |
(86.7) |
Income (loss) before tax |
372.9 |
282.3 |
Tax |
(110.4) |
(79.7) |
Income (loss) from continuing operations |
262.4 |
202.6 |
Income from
discontinued operation, net of tax |
0.0 |
0.0 |
Net income (loss) |
262.4 |
202.6 |
Attributable
to: |
|
|
- owners of the
parent |
262.5 |
202.6 |
- non-controlling
interests |
(0.0) |
0.0 |
Earnings (loss) per
share (EPS) (in euros): |
|
|
- basic,
attributable to owners of the parent |
€1.13 |
€0.88 |
- diluted,
attributable to owners of the parent |
€1.06 |
€0.85 |
Earnings (loss) per
share (EPS) from continuing operations (in euros): |
|
|
- basic,
attributable to owners of the parent |
€1.13 |
€0.88 |
- diluted, attributable to owners of the parent |
€1.06 |
€0.85 |
*: A
reconciliation is provided in the “Restated income statement for
prior financial years” section of this release. |
Consolidated statement of financial
position
Assets
(in millions of
euros) |
31/12/2023 |
31/12/2022 |
|
|
restated* |
Goodwill
impairment |
3,988.1 |
3,914.1 |
Intangible
assets |
695.1 |
763.4 |
Right-of-use
assets |
512.8 |
466.9 |
Property, plant
and equipment |
2,210.8 |
2,039.8 |
Other equity
investments |
0.1 |
0.1 |
Other
non-current assets |
66.5 |
79.2 |
Deferred tax
assets |
46.9 |
43.0 |
Employee benefit
assets |
12.3 |
18.7 |
Total
non-current assets |
7,532.5 |
7,325.2 |
Inventories |
185.6 |
195.2 |
Contract
assets |
51.9 |
45.5 |
Trade and other
receivables |
823.4 |
746.5 |
Current tax
assets |
24.5 |
18.2 |
Other
assets |
19.3 |
17.4 |
Cash and cash
equivalents |
665.1 |
286.1 |
Assets held for
sale |
0.0 |
0.2 |
Total current
assets |
1,769.7 |
1,309.1 |
Total assets |
9,302.2 |
8,634.3 |
*: A reconciliation is provided in the “Restated income
statement for prior financial years” section of this release.
Equity and liabilities
(In millions of
euros) |
31/12/2023 |
31/12/2022 |
|
|
restated* |
Share
capital |
234.0 |
230.1 |
Additional
paid-in capital |
2,477.7 |
2,440.9 |
Treasury share
reserve |
(0.7) |
(1.7) |
Other
reserves |
(289.1) |
(324.1) |
Retained
earnings |
1,053.8 |
866.2 |
Equity
attributable to owners of the parent |
3,475.7 |
3,211.5 |
Non-controlling interests |
0.7 |
0.8 |
Total
equity |
3,476.4 |
3,212.3 |
Provisions |
94.0 |
91.8 |
Employee benefit
liabilities |
90.7 |
69.4 |
Borrowings and
financial debt |
2,717.5 |
3,034.9 |
Deferred tax
liabilities |
293.6 |
308.9 |
Lease
liabilities |
430.0 |
390.3 |
Other
non-current liabilities |
57.9 |
69.5 |
Total
non-current liabilities |
3,683.6 |
3,964.7 |
Current
provisions |
17.1 |
10.4 |
Current tax
liabilities |
24.2 |
24.0 |
Trade and other
payables |
404.8 |
364.8 |
Contract
liabilities |
83.7 |
81.3 |
Current lease
liabilities |
107.4 |
95.2 |
Other
liabilities |
531.9 |
452.4 |
Bank overdrafts
and current borrowings |
973.1 |
429.3 |
Liabilities
directly associated with assets held for sale |
0.0 |
0.0 |
Total current
liabilities |
2,142.2 |
1,457.3 |
Total equity and liabilities |
9,302.2 |
8,634.3 |
*: A reconciliation is provided in the “Restated income
statement for prior financial years” section of this release.
Consolidated statement of cash flows
(in millions of
euros) |
2023 |
2022restated* |
Net income (loss) |
262.4 |
202.6 |
Tax |
110.4 |
79.7 |
Net financial
income (expense) |
124.6 |
86.7 |
Goodwill
impairment |
0.0 |
58.7 |
Share-based
payments |
22.9 |
20.3 |
Depreciation,
amortization and provisions |
885.3 |
793.6 |
Portion of
grants transferred to income |
(0.5) |
(0.7) |
Net gains and
losses on disposal of property, plant and equipment and intangible
assets |
4.3 |
5.4 |
Adjustment to
consideration payable to the vendor and other cash items |
48.4 |
(2.5) |
Cash flows before finance costs and tax |
1,457.9 |
1,243.8 |
Change in
inventories |
12.3 |
(50.0) |
Change in trade
and other receivables and contract assets |
(66.6) |
(119.3) |
Change in other
assets |
(1.4) |
0.3 |
Change in trade
and other payables |
1.7 |
82.2 |
Change in
contract liabilities and other liabilities |
52.5 |
35.7 |
Other
changes |
(0.9) |
(2.2) |
Employee
benefits |
(3.5) |
0.7 |
Tax paid |
(126.4) |
(100.1) |
Net cash from operating activities |
1,325.7 |
1,091.2 |
Acquisition of
intangible assets |
(26.8) |
(26.5) |
Proceeds from
sale of intangible assets |
0.1 |
0.0 |
Acquisition of
property, plant and equipment |
(797.1) |
(673.3) |
Proceeds from
sale of property, plant and equipment |
2.8 |
7.4 |
Acquisition of
subsidiaries, net of cash acquired |
(82.2) |
(221.7) |
Proceeds from
disposal of subsidiaries, net of cash transferred |
0.0 |
(0.0) |
Changes in
loans and advances |
0.5 |
1.1 |
Dividends
earned |
(0.0) |
0.0 |
Investment grants |
0.3 |
0.5 |
Net cash from investing activities |
(902.4) |
(912.5) |
Capital
increase |
7.9 |
4.6 |
Treasury
shares |
1.2 |
(0.1) |
Dividends
paid |
(61.7) |
(33.2) |
Proceeds from
new borrowings |
1,194.8 |
1,244.0 |
Repayments of
borrowings |
(985.9) |
(1,091.2) |
Lease liability
payments - principal |
(111.0) |
(101.5) |
Net interest
paid (including interest on lease liabilities) |
(90.2) |
(72.9) |
Other cash flows related to financing activities |
(1.4) |
(3.4) |
Net cash from financing activities |
(46.4) |
(53.7) |
Net increase (decrease) in cash and cash
equivalents |
376.8 |
125.0 |
Cash and cash
equivalents at beginning of period |
286.1 |
160.1 |
Effect of changes in foreign exchange rates on cash and cash
equivalents |
1.8 |
1.0 |
Cash and cash equivalents at end of period |
664.7 |
286.1 |
*: A reconciliation is provided in the “Restated income
statement for prior financial years” section of this release.
1 The target boundary includes land-related
emissions and removals from bioenergy. scope 2 emissions targets
are market-based.Scope 1 (direct emissions) is mainly associated
with consumption of gas, fuel, etc. Scope 2 (indirect emissions) is
associated with consumption of electrical energy or steam; Scope 3
(other indirect emissions) is associated with emission from other
areas: purchases, upstream transport, employee travel, etc.
- Elis - Full-year 2023 results - Press release
Elis (TG:7EL)
Historical Stock Chart
From Jun 2024 to Jul 2024
Elis (TG:7EL)
Historical Stock Chart
From Jul 2023 to Jul 2024