Profitability resilience
Integration of the two structuring
acquisitions
Strong synergies expected
- Good resistance of EBIT despite the particular context in
2020
- Integration of acquisitions perfectly in line with the
business plan
- Robust financial position to support the Group's development
ambitions
- Clearly defined synergy plan and ambitious targets
Regulatory News:
SergeFerrari Group (Paris:SEFER)(FR0011950682 -
SEFER) is a leading global supplier of innovative flexible
composite materials under the Serge Ferrari and Verseidag brands
and is listed on Euronext Paris – Compartment C.
On March 11, 2021 the Board of Directors approved the 2020
consolidated financial statements. The Statutory Auditors have
conducted a review of these consolidated financial statements.
Audited financial statements (reports currently under
preparation)
€m
2020
2019
Change
Change in
conso. scope
Revenues
195.3
189.0
+3.3%
+28.7
Adjusted EBITDA1
23.0
21.6
+6.5%
+1.7
EBIT
6.8
7.6
-11,3%
+0.3
Operating income
4.7
7.6
-41.8%
+0.3
Net income, Group share
0.5
4.8
Net cash/(debt)
(66.5)
3.7
Shareholders’ equity, Group share
94.9
96.7
Sébastien Ferrari, SergeFerrari Group Chairman and CEO,
commented: “The Group demonstrated its flexibility and
responsiveness in 2020 despite the brutal impact of adverse events:
besides the lockdown measures and forced shutdowns that affected
some of our customers, the Group also resolved the late 2019
industrial incident, which had left it without its main production
line for two months. The adaptive and cost-cutting measures
implemented from March 2020 onwards enabled the Group to maintain
profitability and focus on the initial integration processes for
F.I.T Industrial Co Ltd in Taiwan and Verseidag-Indutex GmbH in
Germany. Now that the sales forces have been merged and are already
operational, 2021 will see the completion of the industrial
integration of the various facilities. The synergies expected by
the Group, which will begin to have a material impact in 2022, will
further consolidate the Group’s leading position in its four
strategic markets.”
SergeFerrari Group profitability maintained
Refocused on its 4 strategic markets - Tensile Architecture,
Modular Structures, Solar Protection, and Furniture/Marine -
SergeFerrari Group posted 2020 revenues of €195.3 million, up 3.3%
at current consolidation scope and exchange rates. Revenues
excluding the impact of the F.I.T and Verseidag-Indutex
acquisitions were down 11% year on year. These annual variations
saw contrasting half-year trends, with sales down by over 21% in
the first half due to the two major events (La Tour du Pin incident
and first lockdown) which were effectively managed, allowing a
return to a more normal situation in the second half of the year.
This swift recovery in business demonstrates the Group’s capacity
for resilience and the responsiveness of its industrial
organization. The latter is also illustrated by the launch of a new
product, Agivir, an anti-virus membrane effective against COVID-19
and designed primarily for use in crowded public places.
Amid these heckled circumstances, the Group maintained its
strategic course by completing two transformative acquisitions with
the acquisition of a 55% stake in the capital of F.I.T, a Taiwanese
company that designs, manufactures and distributes high-tech
non-combustible materials, and the acquisition of
Verseidag-Indutex, world leader in PTFE glass materials, from
Jagenberg Group. These two operations will strengthen SergeFerrari
Group’s positioning on three of its priority markets, Tensile
Architecture (F.I.T and Verseidag), Modular Structures, and Solar
Protection (Verseidag).
Thanks to its flexible cost structure, SergeFerrari Group
managed to reduce the impact of external factors on profitability
by increasing operating leverage. Adjusted EBITDA was up 6.5% at
current consolidation scope and exchange rates and virtually flat
at constant consolidation scope and exchange rates. Operating
income was impacted by the integration expenses and costs of the
two acquisitions (€3.1 million) and amounted to €4.7 million versus
€7.6 million in 2019. The Group posted a positive net income (€0.5
million) despite the increase in cost of debt as a result of the
financing arrangements set up for the acquisitions and the
inclusion of these companies’ debt in the consolidated financial
statements, as well as an adverse currency effect from several
currencies (Turkish lira, Indian rupee, Brazilian real).
Group financial position secured through financing
strategy
To finance these acquisitions and refinance existing loans
maturing in July 2021 in addition to Verseidag-Indutex debt,
SergeFerrari Group has contracted new medium to long-term financing
arrangements for a total of €105 million, €64.5 million of which
has already been drawn. The Group issued a new €30 million Euro PP
bond to replace the Euro PP 2015 issue, repaid in advance, plus
bank loans totaling €75 million. Loans confirmed but not drawn as
of December 31, 2020 will allow the Group to refund its
acquisitions while maintaining the financial resources necessary
for its investments and general requirements in strict compliance
with its covenants2.
New Group commercial and industrial synergy plan and
outlook
SergeFerrari Group, in order to take full advantage of the
Verseidag and F.I.T acquisitions, is rolling out a synergy plan
focused on two main areas:
- Activating sales leverage and spreading newly acquired
expertise among the Group’s offerings;
- Industrial optimization.
Activating sales leverage means increasing the efficiency of
marketing expenditure so that margins rise faster than costs.
Deployment of the F.I.T and Verseidag product offerings will be
boosted by the SergeFerrari network. As such, under the supervision
of the regional manager, each sales agent will be responsible for a
double brand portfolio.
Meanwhile, the Group plans to step up its industrial
transformation in order to streamline production resources and
implement a satisfactory production plan across all locations. For
example, the Eglisau plant in Switzerland will refocus on its main
area of expertise by readjusting its capacities to transfer a part
of its operations to Krefeld in Germany able to integrate them
without additional investment.
As a result of these measures, SergeFerrari Group intends to
generate significant commercial and industrial synergies net of
implementation costs by 2024, representing around 3% of current
sales including Verseidag and F.I.T in a full year.
Over the medium term, capitalizing on the successful refocus on
the four core markets, SergeFerrari Group is targeting
consolidated revenues of €300 million. In view of the
synergy plan, increased operating leverage and continued tight cost
control, the Group also aims to achieve earnings growth higher
than revenue growth.
Annual General Meeting
At the General Meeting scheduled for May 19, 2021, the Group
will request shareholder for the whole of 2020 earnings to be
posted to reserves and that no dividend will be paid in respect of
the year.
Calendar
- Publication of Q1 2021 revenues on
Tuesday, April 27, 2021 after market close - Annual General
Meeting: Wednesday, May 19, 2021 at 5:00pm CET
ABOUT THE SERGE FERRARI GROUP
The Serge Ferrari Group designs, develops, and manufactures
innovative composite materials for lightweight architectural and
outdoor applications in a global market estimated by the Company at
around €6 billion. The unique characteristics of these products
make them ideal for technical applications in three fields:
architecture, specialties for industry professionals, and composite
membranes for the consumer market. Its main competitive advantage
is based on the implementation of differentiating proprietary
technologies and know-how. Marketing its products under two brands,
Serge Ferrari and Verseidag, the Serge Ferrari Group is a leading
global supplier of composite materials for Tensile Architecture,
Modular Structures and Solar Protection. The Group has
manufacturing facilities in France, Switzerland, Germany, Italy and
Asia. Serge Ferrari operates in 80 countries via subsidiaries,
sales offices and a worldwide network of over 100 independent
distributors.
In 2020, Serge Ferrari posted consolidated revenues of €195.3
million, over 80% of which was generated outside France. The
SergeFerrari Group share is listed on Euronext Paris – Compartment
C (ISIN: FR0011950682). The SergeFerrari Group share is eligible
for the French PEA-PME and FCPI investment schemes.
www.sergeferrari.com
___________________________________ 1 Adjusted EBITDA =
Operating income + change in depreciation, amortization and
provisions + CVAE 2 The net debt covenant is calculated excluding
the impact of IFRS 16 and amounts to €34.3m for the year
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210311005804/en/
Serge Ferrari Philippe Brun Chief Financial
Officer Arnaud Mengin Investor Relations
investor@sergeferrari.com
NewCap Investor Relations – Financial
communication Théo Martin / Louis Tilquin Tel: +33(0) 1 44 71
94 94 sferrari@newcap.eu
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