Unibel : Results 2020
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Press
Release Suresnes
— March 19, 2021 8.45am |
UnibelAnnual financial
information2020 Results
Company shows strong resilience in
pandemic-related crisis and strengthens its CSR
commitmentsTransformation continues
apace
- Robust financial performance:
- €242 million operating profit, up 15.7%, 86bps
operating margin increase to 7.0%.
- Consolidated net profit up 23.1%.
- €382 million operating cash flow, up €79
million.
- Transformation plan well under way to strengthen
position as a major player in healthy snacking:
- Organic sales growth buoyed by positive momentum across
all core brands, resumed growth for Bel in France and USA, and
MOM's ongoing positive trajectory.
- Product-offering diversification accelerated in the
plant-based food sector, notably with All in Foods
acquisition.
- Cost-cutting plan successfully completed.
- Strong innovations pipeline on tap for the
future.
- 1st quarter 2021: unilateral promise to purchase assets
comprising the Leerdammer brand signed with
Lactalis.
- CSR commitments strengthened:
- New and ambitious biodiversity policy
implemented.
- New sustainable dairy farming practices agreement
reached with APBO.
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Amounts are stated in millions of euros and
rounded off to the nearest million. Ratios and variances are
calculated based on underlying amounts and are not rounded.
At its March 18, 2021 meeting, the Board
approved the consolidated financial statements for the year ended
December 31, 2020. At this meeting, the independent auditors
reported having completed their audit of said financial statements
and that their report was forthcoming.
Antoine Fievet, Bel Group Chairman and Chief
Executive Officer and a Unibel board director, said: "The crisis we
experienced in 2020 was unprecedented at many levels, first and
foremost on a human level, but also hitting our business. Our
highest priority throughout the year was to protect our ecosystem
and our employees in particular. Because we executed a fast and
agile adaptation plan at the outset of the crisis, we were able to
ensure the continuity of the food supply chain under controlled
health conditions and preserve the strength of our financial
structure. Once again, I want to thank our employees for their
exemplary mobilization, which led us to today's robust performance.
The crisis showed how important it is for companies to develop new
sustainable growth models that create value for all in the medium
term. This is something we have believed for many years. It's a
belief that guides our actions, and one that in 2020 led to
charitable initiatives to help the most vulnerable and
disadvantaged confront the crisis. Despite a still uncertain
environment, we believe our responsible business model is right,
and we remain confident in Bel's ability to continue its
transformation on behalf of a more sustainable and responsible
future for food."
Key figures
€m |
2020 |
2019 |
% change |
Sales |
3,456 |
3,403 |
+1.6% |
Underlying operating profit |
260 |
235 |
+11% |
Operating profit |
242 |
209 |
+15.7% |
Operating margin |
7.0% |
6.1% |
+86bps |
Net financial items |
(29) |
(33) |
12.0% |
Consolidated net profit - Group share |
92 |
75 |
+23.1% |
|
|
|
|
Operating cash flow |
382 |
303 |
+79 |
Management, adaptation and solidarity during the Covid
19-related crisis
Since Covid 19 began, Unibel Group immediately
established an action plan to ensure the health and safety of all
its stakeholders, enable the continuation of vital operations under
exemplary health measures and limit the financial impact of the
crisis, while maintaining financial liquidity.
The group's strong ability to adapt led to the
agile and efficient deployment of operational measures aimed at
optimizing inventory management and ensuring product deliveries
against a backdrop of fluctuating demand. The execution of the
cost-reduction plan, coupled with an in-depth review of operating
expenses at all levels of the business, the streamlining of fixed
costs and optimization of investments, helped maintain
profitability, while curbing non-recurring costs. At December 31,
2020, the group had a strong net cash position, bolstered by a
recent bond issue, with more than €595 million in cash and cash
equivalents and €820 million in untapped credit lines.
In line with its sustainability principles and
true to its values, Unibel Group also mobilized alongside its
employees in charitable activities to help its local communities
cope with the crisis. This involved the group making every effort
to maintain its milk collection activities in all dairy basins and
offered some suppliers targeted programs for faster payments under
favorable terms and conditions. In April 2020, it also donated an
entire day's production of The Laughing Cow cheese, representing
the equivalent of 20 million single-serving portions, to
healthcare providers and the most disadvantaged people. Lastly, in
France, the group joined the "Tous confinés, Tous engagés" (All
locked down, All committed), a government-backed platform
initiative that allows employees to carry out national emergency
missions identified by the French government or give away
skill-based services.
Transformation accelerated to become a leader in healthy
snacking
In June 2020, Unibel Group acquired 80% of All
in Foods, a French startup with reputed knowhow and specialization
in plant-based cheese and sauce alternatives sold under the Nature
& Moi brand. This M&A transaction is in line with its 2015
strategy to take on new businesses and so become a major player in
healthy snacking based on three complementary segments, namely
dairy, fruit and plant-based products.
Under its transformation programme, Unibel
completed its earlier announced cost-cutting plan successfully and
on time, and in so doing, generating €120 million in cost savings,
which primarily arose from optimizing purchases, marketing and
advertising spend and generating productivity gains and cutting
overhead costs. The group has ploughed a share of the savings back
into its business, as called for under the transformation plan.
Building on its strategic choices and proactive
policy throughout the year, Unibel Group was able to adapt its
product offering and continued to innovate to meet emerging
shopping trends and customer expectations around the world, such as
home cooking products and mass marketing organic and plant-based
food. For example, the group launched easily-spread and plant-based
versions of Boursin®, sold exclusively in the United States via
Amazon from October 2020. Unibel also launched numerous product
renewals, with new additive-free recipes under its plan to
strengthen its offering in the natural product space. Because
lockdown hit rollout of these new product innovations and led to
delays, the group currently has a sizeable future innovation
pipeline for all core brands that will enable it to break into new
high-growth market segments.
A reputed sustainable business model
In line with the long-term commitment to
champion healthier food epitomised in its "For All. For Good"
tagline, Unibel shared its strengthened beliefs and continued its
sustainability efforts in 2020. The group committed to promoting
biodiversity, establishing a dedicated policy with expert help from
WWF France to take biodiversity into account across its value
chain, from farm to table. It also joined the international Act for
Good initiative, whose mission is to protect, promote and restore
biodiversity.
Unibel also pledged to fight food waste
alongside Too Good To Go with The Laughing Cow® brand, in France in
March 2020 and in Portugal in December 2020. The group also sets up
innovative pilot efforts to develop responsible packaging, with the
goal of achieving 100% recyclable and/or biodegradable packaging by
2025. Seeking to guarantee consumers access to locally produced,
healthy and sustainable food, Bel Group and France's Bel West
Producers Association (APBO — Association des Producteurs de lait
Bel de l'Ouest) late 2020 signed a new agreement for 2021, marking
a continuation of the three-year joint venture. These commitments
constitute a secured business framework for all 800 APBO farmer
members and spell out the terms and conditions for continuing
ABPO-Bel's unique strategy based on more sustainable farming
practices.
Lastly, believing that business results and
corporate social responsibility performance are intrinsically
linked, and should be understood in tandem to create value for all,
Bel Group revamped its organization in October 2020, with a view to
bringing CSR and Finance within the same department under the
management of Frédéric Médard.
Robust financial performance
2020 Unibel consolidated sales came in at
€3,455.7 million, up 1.6% year-on-year - like-for-like sales up
2.8%, while currency losses reduced sales by 1.7%. Excluding
hyperinflation in Iran1, sales grew 3.2% versus 2019.
The strong performance was buoyed by an upward
trajectory in all core brands across all markets, demonstrating the
appeal of Unibel's continuously upgraded dairy offering. Results
were also marked by a return to sales growth in France and USA, the
two main markets, while the group’s footprint was further expanded
In China, a market with enormous potential, where the Foodservice
business turned in double-digit sales growth. Lastly, 2020 marked a
continuation of MOM's growth trajectory.
|
2020 |
|
2019 |
€m |
Sales |
Operating profit |
|
Sales |
Operating profit |
Mature Markets |
2,865 |
164 |
|
2,871 |
161 |
New
Territories* |
591 |
78 |
|
532 |
48 |
Total |
3,456 |
242 |
|
3,403 |
209 |
* New Territories encompass the MOM business
(Mont-Blanc, Materne), as well as markets in Sub-Saharan Africa and
China.
Operating profit came in at €242 million, a
15.7% increase that reflects improved gross margin, high
productivity throughout the year, world-class operations and
successful cost-cutting. Accordingly, operating margin advanced 86
basis points to 7.0%. Growth stemmed from improved operating
performance in both Mature Markets and New Territories.
Net financial items improved to a €29 million
net expense from a €33 million net expense in 2019, largely due to
lower net cost of debt. Consolidated net profit - Group share
amounted to €92.3 million, up 23.1% year-on-year. 2020
earnings per share amounted to €44.02, compared with €35.76 EPS in
2019. Operating cash flow advanced a robust €76 million during the
year to €382 million, buoyed by strong sales and optimized
inventory management.
At December 31, 2020, the Group reported a
strong and healthy balance sheet. At December 31, 2020, equity
totalled €1,908 million, up from €1,863 million at December 31,
2019. Net debt, including financial lease liabilities under IFRS
16, came to €516 million, down from €595 million at December
31, 2019. As part of efforts to actively manage debt, late June
2020 the group successfully issued a $150-million US Private
Placement (USPP) bond under French law. The issue, which matures in
November 2035, was aimed at diversifying group funding sources,
lengthening debt maturity and increasing Group debt exposure to the
US dollar, while taking advantage of low interest rates.
Accordingly, at December 31, 2020, the group had €595 million in
cash and cash equivalents, with just €70 million in outstanding NEU
CP commercial paper, and €820 million in untapped credit lines
maturing in 2023 and 2024, underscoring the group's strong
liquidity.
2021 Outlook
The start of 2021 is still overshadowed by
uncertainty due to the pandemic and geopolitical conflicts in the
Middle East and North Africa. While consumer demand for healthy and
green snacks remains intact around the world, currency volatility
and the unfavourable trends in raw material prices call for
caution. Against this backdrop, Unibel Group will remain focused on
improving operating results, exemplary financial management and
will continue to rely on its strong balance sheet. Subject to
changes in the pandemic and market sentiment, the group remains
confident in its ability to strengthen its market share in healthy
snacking, while continuing to innovate and boost the appeal of its
brands, while meeting new consumer trends in the dairy, fruit and
plant-based segments.
Exclusive negotiations between Bel and
Lactalis, following a signed unilateral promise to purchase assets
comprising Lamda Bel Group and Lactalis Group today
announced they have entered into exclusive negotiations having
signed a unilateral promise to purchase a business comprising Royal
Bel Lamda NL, Bel Italia, Bel Deutschland, the Lamda brand and all
its related rights, as well as Bel Shostka Ukraine that Lactalis
will take over. Said business will be transferred to Lactalis by
[S], a wholly owned Bel subsidiary, in exchange for
Lactalis’s 1,591,472 Bel shares (23.16% equity share). Following
the transaction, Lactalis would hold 0.90% equity stake in Bel.
2020 Lamda and Bel Shostka Ukraine revenues were around
€500 million, of which €350 million branded products, with an
estimated operating profit of approximately €25
million. This asset sale is fully in line with the Bel
Group’s strategy launched in 2015, which aims to expand its
activities beyond cheese products to become a major player in
healthy snacking. After this deal, the group will have additional
options to ramp up the diversification strategy of its product
offering in its three complementary segments, and to develop its
activities in high-growth regional markets like Asia/Pacific and
North America. Meanwhile, Lactalis’s sale of its Bel shareholding
will allow the family shareholders to increase control and in so
doing, lock in the Group’s independent family business
status. Subject to and following completion of this
transaction, Bel intends to launch a share buyback offer on the
open market at €440 per share2 (cum dividend), thereby giving all
Bel minority shareholders an option to sell their holdings in
exchange for cash, if they wish. The share buyback offer would be
subject to a report by the independent expert appointed by the
company on the financial terms of the offer and the AMF's (Autorité
des marchés financiers) review procedure. After the buyback offer,
Upsilon will launch a public tender offer followed by a squeeze-out
at the same price as the share buyback offer. Completion of the
above asset sale is planned to occur by the end of summer 2021,
while the settlement and delivery of the public tender offer is
expected in the third quarter of 2021. Upon completion of said
public tender offers, Bel’s shares would be delisted. Unibel
Group reaffirms its commitment to maintain a healthy
and solid balance sheet.
Dividend for FY 2020
At its March 18, 2021 meeting, the Unibel Board
of Directors proposed a €11 per share dividend, which will go
ex-dividend on May 19th and paid on May 21st, 2021, after approval
by the Annual General Meeting convened for May 11th.
Unibel's financial performance indicators
The Group uses non-IFRS financial performance
indicators internally and for its external communication. These
non-IFRS indicators are defined below:
Organic growth corresponds to
reported sales growth, excluding impacts from foreign exchange
fluctuations and changes in the scope of consolidation, i.e. on a
constant structure and exchange rate basis and excluding inflation
in Iran. Since 2020, Iran's economy is deemed to be a
hyperinflation economy. Accordingly, inflation impacts, based on
the Consumer Price Index (CPI), were excluded when determining
organic growth. The organic growth rate is
calculated by applying the exchange rate for the prior year period
to the current year period.
Operating margin corresponds to
operating profit.Operating cash flow corresponds
to net cash flow generated by operating activities.
Net debt is described in note
5.4 to the summary consolidated financial statements. It consists
of long- and short-term borrowings, long- and short-term
right-of-use liabilities, and current used banking facilities, less
cash and cash equivalents.
This press release may contain forward-looking
statements. Such trend and/or target information should in no way
be regarded as earnings forecast data or performance indicators of
any kind. This information is by nature subject to risks and
uncertainties that may be beyond the Company's control. A detailed
description of these risks and uncertainties is provided in the
Company's Universal Registration Document, available at
(www.groupe-bel.com). More comprehensive information about the Bel
Group can be found in the "Regulatory Information" section of the
www.groupe-bel.com website.
About Unibel
Unibel, a heritage company is the holding
company of the Bel Group, a world leader in branded cheese and a
major player in the healthy snack market. Its portfolio of
differentiated and internationally recognized brands include such
products as The Laughing Cow®, Kiri®, Mini Babybel®, Leerdammer®,
Boursin®, Pom’Potes®, and GoGo squeeZ®, as well as some 20 local
brands. Together, these brands helped generate sales of €3.46
billion in 2020. Some 12,510 employees in some 30 subsidiaries
around the world contribute to deployment of the Group's mission to
champion healthier and responsible food for all. Bel products are
prepared at 33 production sites and distributed in nearly 120
countries.http://www.unibel.fr
1 Organic growth corresponds to reported sales
growth, excluding impacts from foreign exchange fluctuations and
changes in the scope of consolidation and excluding inflation in
Iran. Since 2020, Iran's economy is deemed to be a hyperinflation
economy. Accordingly, inflation impacts, based on the Consumer
Price Index (CPI), were excluded when determining organic
growth.
2 This price is indicative and will be finalized based on the
conclusions of an independent expert report
- Unibel-2020-résultats financiers-fr-V20-210318 EN
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