Earnings Release • Feb 14, 2013
Earnings Release
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Imerys' Board of Directors, meeting on February 13, 2013, under the chairmanship of Gilles Michel, examined the definitive financial statements for 2012. These will be submitted for approval at the Shareholders' General Meeting to be held on April 25, 2013.
| Consolidated results (€ millions) |
2012 | 2011 | % current change |
|---|---|---|---|
| Revenue | 3,884.8 | 3,674.8 | + 5.7% |
| Current operating income (2) | 490.1 | 487.0 | + 0.6% |
| Operating margin | 12.6% | 13.3% | - 0.7 point |
| Net income from current operations, Group's share (3) | 310.2 | 303.1 | + 2.3% |
| Net income, Group's share | 300.8 | 282.0 | n.a. |
| Financing Paid capital expenditure Current free operating cash flow (4) Shareholders' equity Net financial debt |
257.1 286.7 2,274.5 874.8 |
227.4 264.9 2,210.9 1,031.1 |
+ 13.1% + 8.2% + 2.9% - 15.2% |
| Data per share (euros) Net income from current operations, Group's share (3)(5) Proposed dividend |
€4.13 €1.55 |
€4.03 €1.50 |
+ 2.5% + 3.3% |
| Headcount as of December, 31 | 16,026 | 16,187 |
«In 2012, Imerys achieved its growth target in net income from current operations and strengthened its financial structure. The Group was reactive to adapt to market conditions and integrated Luzenac Group a year ahead of schedule. In parallel, the first stages of the 2012-2016 plan were launched: step up of Research & Development programs, increase in growth capital expenditure, further geographic and sector diversification. Imerys is thus entering 2013 with a greater resilience to fluctuating economic conditions and a sound balance sheet. With the caution and selectiveness imposed by an increasingly uncertain economic environment, the Group will continue to implement its strategy of development, innovation and long-term value-creating acquisitions.»
1 Throughout the present press release, "Comparable change" means at comparable Group structure and exchange rates.
2 Throughout the present press release, "Current operating income" means operating income before other operating revenue and expenses.
3 Group share of net income before other operating revenue and expenses, net.
4 Current free operating cash flow: EBITDA after deduction of notional tax, changes in working capital and paid capital expenditure.
5 The weighed average number of outstanding shares was 75,165,743 in 2012 compared with 75,272,854 in 2011.
The economic environment has become even more contrasted from one geographic zone to another, since mid-2011. While a certain dynamism returned in the United States and more particularly so in the second half of 2012, several European countries slowed down significantly. Emerging markets continued to progress, albeit at a more moderate pace.
Trends on the Group's markets varied considerably across sectors and regions. Demand for investment goods (notably machine tools, etc.), consumer durables (automotive, etc.) and housing stagnated or even declined in Europe, as shown in lower steel production and in housing starts. Demand from those markets remained however dynamic in North America. Fast-moving consumer goods held out well once again, including in Europe. Growth remained firm for several of the Group's specialty applications (mobile energy, technical ceramics, etc.).
After falling against the dollar for several quarters, the euro picked up in late 2012. Overall trends in external costs (rising prices of raw materials and some energies, etc.) were unchanged from 2011.
In 2012, Imerys continued to develop its portfolio of activities through the following operations:
The Group also received, on December 12, 2012, a binding acquisition offer from the Bouyer Leroux group for its Imerys Structure activity.
The consolidated financial statements for the year ended December 31, 2012 were closed by the Board of Directors at its meeting on February 13, 2013. No significant event is to be reported between the closing date and that of the Board of Directors.
The Group's 2012 results reflected its ability to adapt to changing economic conditions, with the uncertainties of recent months continuing into early 2013. Consequently, Imerys will continue to implement targeted measures to adapt to market conditions. Thanks to its robust fundamentals and financial structure, Imerys will cautiously and selectively continue to implement its growth strategy based on innovation, geographical expansion and long term value-creating acquisitions.
At its meeting of February 13, 2013, Imerys' Board of Directors approved the draft resolutions which will be submitted at the Shareholders' General Meeting on April 25, 2013. They provide in particular for: the renewal of terms of office as Directors of Mrs. Fatine Layt, Mr. Ian Gallienne, Mr. Robert Peugeot, Mr. Olivier Pirotte and Mr. Amaury de Seze; the ratification of the co-option of Mrs. Marion Guillou; the appointment as new Director of Mrs. Marie-Françoise Walbaum. On this occasion, the Board has warmly thanked Mr. Jacques Drijard, whose term will expire for statutory reasons as well as Mr. Jean Monville and Mr Pierre-Jean Sivignon, who did not seek the renewal of their term of office, for their precious contribution to the works of the Board and its Committees.
The Board of Directors will propose to the Shareholders' General Meeting of April 25, 2013 an increase in dividend to €1.55 per share, i.e. a total amount of €116.8 million, which represents 37.6% of the Group's share of net income from current operations, in line with Imerys' historical payout ratio. The dividend would be paid from May 13, 2013.
| Revenue (€ millions) |
Change in revenue (% previous year) |
Comparable change in revenue (% previous year) |
of which Volume effect |
of which Price/Mix effect |
|
|---|---|---|---|---|---|
| 2010 | 3,346.7 | + 20.7% | + 15.0% | + 13.1% | + 1.9% |
| 2011 | 3,674.8 | + 9.8% | + 8.1% | + 3.7% | + 4.4% |
| 2012 | 3,884.8 | + 5.7% | - 2.1% | - 5.4% | + 3.3% |
| Non-audited quarterly data. | 2012 revenue (€ millions) |
2011 revenue (€ millions) |
Change in revenue (% previous year) |
Compar able change in revenue (% previous year) |
of which Volume effect |
of which Price/Mix effect |
|---|---|---|---|---|---|---|
| st quarter 1 |
974.4 | 882.7 | + 10.4% | + 0.2% | - 4.0% | + 4.2% |
| nd quarter 2 |
1,011.8 | 924.7 | + 9.4% | - 3.1% | - 6.3% | + 3.2% |
| st half 1 |
1,986.2 | 1,807.3 | + 9.9% | - 1.5% | - 5.2% | + 3.7% |
| rd quarter 3 |
984.0 | 942.9 | + 4.4% | - 2.8% | - 6.1% | + 3.3% |
| th quarter 4 |
914.6 | 924.6 | - 1.1% | - 2.7% | - 5.0% | + 2.3% |
| nd half 2 |
1,898.6 | 1,867.5 | + 1.7% | - 2.8% | - 5.6% | + 2.8% |
At €3,884.8 million, revenue increased + 5.7% in 2012 compared with 2011. It takes into account:
At comparable structure and exchange rates, revenue decreased - 2.1% compared with 2011.
Product price/mix, which was positive effect in every business group, improved further this year (+ €119.6 million). Sales of new products contribute to this trend, with more than €250 million in revenue achieved with products launched in the past five years (+ 25% vs. 2011).
From the second quarter of 2012, the Group's European activities relating to the construction and industrial equipment sectors were affected by the recession in this region. Some activities, such as Monolithic Refractories were not impacted until the middle of the third quarter. On the other hand, the divisions exposed to the US construction sector posted better performances. For the full year, the slump in sales volumes represents a - €197.8 million decrease in revenue.
In the fourth quarter of 2012, the change in volumes for the entire Group (- 5.0% vs. 4th quarter 2011) was comparable to the change observed in previous quarters. This trend takes into account the production stoppages that are usual towards the end of the year in downstream industries. Some of the stoppages continued into January.
| (€ millions) | Revenue 2012 | Revenue 2011 | % change 2012 vs. 2011 |
% consolidated revenue 2012 |
|---|---|---|---|---|
| Western Europe | 1,805.2 | 1,754.3 | + 2.9% | 46% |
| of which France | 614.5 | 624.3 | - 1.6% | 16% |
| United States / Canada | 836.6 | 724.1 | + 15.5% | 22% |
| Emerging countries | 1,034.3 | 998.3 | + 3.6% | 27% |
| Other (Japan/ Australia) | 208.7 | 198.1 | + 5.4% | 5% |
| Total | 3,884.8 | 3,674.8 | + 5.7% | 100% |
Imerys now achieves 54% of its consolidated revenue outside Western Europe, compared with 47% in 2008. In the European region, Northern Europe is the principal destination for sales, with exposure to Southern European countries (Portugal, Italy, Greece, Spain) remaining below 7%.
The change in sales by destination takes two important events into account:
Excluding change in Group structure and exchange rate effects, geographic trends illustrate the marked contrast between Europe, entering in a recession cycle, and robust sales in North America and emerging regions, with however lower growth in Brazil, India and China, the main emerging countries where the Group is operating.
| Non-audited quarterly data (€ millions) |
2012 | 2011 % change |
% comparable change |
|
|---|---|---|---|---|
| st quarter 1 |
126.8 | 116.4 | + 8.9% | - 0.7% |
| Operating margin | 13.0% | 13.2% | ||
| nd quarter 2 |
139.5 | 136.4 | + 2.2% | - 11.2% |
| Operating margin | 13.8% | 14.8% | ||
| st half 1 |
266.2 | 252.9 | + 5.3% | - 6.4% |
| Operating margin | 13.4% | 14.0% | ||
| rd quarter 3 |
122.6 | 129.0 | - 5.1% | - 14.9% |
| Operating margin | 12.5% | 13.7% | ||
| th quarter 4 |
101.3 | 105.2 | - 3.6% | - 0.7% |
| Operating margin | 11.1% | 11.4% | ||
| nd half 2 |
223.9 | 234.1 | - 4.4% | - 8.5% |
| Operating margin | 11.8% | 12.5% | ||
| Year | 490.1 | 487.0 | + 0.6% | - 7.4% |
| Operating margin | 12.6% | 13.3% |
Current operating income totaled €490.1 million for 2012, a + 0.6% increase that includes the following factors:
At comparable structure and exchange rates, the decrease in current operating income is due to lower sales volumes (- €102.5 million). The measures taken to adjust activity to lower demand enabled the Group to reduce fixed production costs and general expenses, without undermining either Research & Development or the launch of new projects (proppants for the oilfield industry). In total, fixed costs and general expenses decreased by - €11.3 million over the full year 2012.
The increase in variable costs (- €71.3 million), reflecting inflation in some raw materials, energy costs and freight was more than offset by a + €108.5 million price/mix effect.
6 Operating income, before other operating revenue and expenses.
7 Non-audited quarterly data.
8 Mainly the Talc activity.
The Group succeeded in maintaining a 12.6% operating margin, despite a steep decline in volumes, which affected the highest-contributing divisions, including Building Materials, Minerals for Refractories, Fused Minerals and Monolithic Refractories.
In the 4th quarter, operating margin amounted to 11.1% (11.4% in 2011), due to a seasonal effect due to traditional capacity closures at the end of the year in Western manufacturing chains.
Up + 2.3% from 2011, net income from current operations totaled €310.2 million, reflecting:
Growth in net income from current operations, therefore, is in line with the target announced by the Group on July 27, 2012, providing for a level at least comparable to the previous year.
The Group's share of net income, at €300.8 million, takes into account other revenue and expenses for an amount - €9.4 million net of tax of, essentially corresponding to:
9 Net income (loss), Group share, before other operating income and expense, net.
| (€ millions) | 2012 | 2011 |
|---|---|---|
| EBITDA | 659.8 | 686.0 |
| Change in operating working capital | 15.3 | (59.4) |
| Paid capital expenditure | (257.1) | (227.4) |
| Free current operating cash flow * | 286.7 | 264.9 |
| Paid financial expense (net of tax) | (42.4) | (37.3) |
| Other working capital items | 58.1 | (1.0) |
| Current free cash flow | 302.3 | 226.6 |
| * including subsidies, value of divested assets and miscellaneous | 4.4 | 5.3 |
As of December 31, 2012, operating working capital requirement represented 22.8% of annualized sales for the last quarter (vs. 23.7% as of December 31, 2011). This ratio benefits from the implementation of targeted inventory reduction measures and the significant improvement in the Talc activity's working capital requirement. It takes into account the factoring program(10) implemented in 2009, which represented €62 million as of December 31, 2012.
In 2012, the Group continued its development program, as announced, leading to an increase in booked capital expenditure (€266.6 million compared with €229.2 million in 2011, which was up + 35% from 2010). They represent 124% of depreciation expense (compared with 109% in 2011). Development capital projects totaled €115.6 million (+ €20 million vs. previous year) and were selected to support increasing demand in growing markets and regions. Most of these new production lines should come on stream in late 2013 and contribute to the Group's performances in 2014.
As previously stated, the other working capital items mainly reflect tax and social payables for which disbursement lags behind the accounting year. After taking into account paid interest expense and those other working capital items, current free cash flow totals €302.3 million, a + 33% increase.
10 Factoring contract signed on July 23, 2009 under which transferred receivables are deconsolidated, with the risks and benefits related to receivables transferred to the factor bank. €74 million in receivables was factored as on December 31, 2011.
| (€ millions) | December 31, 2012 | June 30, 2012 | December 31, 2011 |
|---|---|---|---|
| Paid dividends | (114.1) | (113.3) | (91.4) |
| Net debt, end of period | 874.8 | 1,039.8 | 1,031.1 |
| Average net debt of the period | 1,009.0 | n.a. | 966.0 |
| Shareholders' equity | 2,274.5 | 2,236.5 | 2,210.9 |
| EBITDA | 659.8 | 353.2 | 686.0 |
| Net debt / shareholders' equity | 38.5% | 46.5% | 46.6% |
| Net debt / EBITDA | 1.3x | 1.5x | 1.5x |
High current free cash flow generation and revenue from the sale of logistical and real estate assets enabled the Group to reduce its debt by more than €156 million, after payment of a €112.8 million dividend to its shareholders on May 9, 2012 (plus €1.3 million in dividends to minority shareholders of the Group's subsidiaries). As of December 31, 2012, the Group's consolidated net financial debt and its indebtedness ratios decreased significantly. At €874.8 million, net financial debt returned to its year-end 2010 level, less than two years after acquiring the Luzenac Group.
As regards financing, in the past 18 months, the Group has secured almost €600 million in additional bilateral credit facilities through to 2015-2016. Total financial resources have therefore been increased and diversified and their average maturity extended. As of December 31, 2012, Imerys' financial resources totaled €2.8 billion (of which €1.6 billion in available financial resources, excluding cash), with an average maturity of 2.9 years. Available financial resources are sufficient to cover 2013 repayments (US\$140 million dollar bond) and the end of the €750 million syndicated credit. Excluding repayments due in 2013, available financial resources total €0.8 billion with an average maturity of 4 years.
In the first half of 2012, Moody's confirmed the long-term credit rating (11) assigned to Imerys a year earlier, "Baa2" with a stable outlook. The short-term rating is "P-2", also with a stable outlook.
Imerys therefore has a very sound financial situation and flexibility to implement its development plan.
11 "Senior unsecured debt rating"
(30% of consolidated revenue)
| (€ millions) | 2012 | 2011 | Current change |
Comparable change |
|---|---|---|---|---|
| Revenue | 1,206.4 | 1,186.1 | + 1.7% | - 3.7% |
| Current operating income | 150.4 | 156.8 | - 4.1% | - 9.0% |
| Operating margin | 12.5% | 13.2% | ||
| Booked capital expenditure | 105.3 | 95.0 | + 10.8% | |
| As % of depreciation expense | 184% | 152% |
Markets for Minerals for Refractories and Fused Minerals (steel(12) , foundry, aluminum, cement, glass, etc.) evolved very differently. Driven by robust demand for capital goods and some consumer durables (machines tools, aerospace, automotive, electronics, etc.) in the United States, activity was conversely affected by the European economy's continued slowdown; in Asia, growth continued at a slow pace. After very high inflation in 2010 and 2011, zircon prices shrank mid 2012.
Graphite & Carbon businesses were boosted by the boom in mobile electronic devices.
The Minerals for Ceramics activity (sanitaryware, floor tiles, tableware) held out well, thanks to its gradual geographic deployment to Asia, the Middle East and South America.
The new proppant plant for shale gas and oil built in Andersonville (Georgia, United States) started in 2012, in a less favorable market environment, marked by a decrease in the total number of rigs operated after several years of increase.
After a 2011 characterized by the rebound in development capital expenditure (in particular with the proppant plant in Andersonville), new projects were initiated in 2012:
12 World steel production in 2012: + 1.2% vs. 2011 (Europe (27): - 4.7%; North America: + 2.5% - source World Steel Association)
Analysis of the + 1.7% rise in revenue to €1,206.4 million shows:
At comparable Group structure and exchange rates, revenue decreased - 3.7% compared with 2011, where demand had substantially increased (+ 12.2% growth at comparable structure and exchange rates). The contribution of proppants increased throughout the year, limiting the significant erosion in volumes, while the price/mix component remained positive.
At €150.4 million, current operating income takes into account the positive impact of foreign exchange (+ €7.0 million) and structure (+ €1.5 million), including the profit generated by Talc activities.
At comparable structure and exchange rates, the decrease in income due to the loss of contributing volumes was partly offset by the cost reduction plans carried out in each of the relevant activities. The US fused magnesia production unit was closed at the end of the year and production allocated among the business group's other operations in the country. At the same time, the business group continued to implement its development plan and financed the launch of its new proppant activity. The increase in the product price/mix component compensated for higher variable costs (rise in zirconium prices, which continued into the 1st half).
Finally, the joint venture The Quartz Corp SAS, consolidated by the equity method since 2011, did not generate income in 2012 (Imerys' share of income in 2011 was €4.3 million). Because of excess inventory throughout the photovoltaic industry, demand was very low in 2012 and production capacities were temporarily restructured.
Taking those items into account, the business group's operating margin held out well, at 12.5%.
(23% of consolidated revenue)
| (€ millions) | 2012 | 2011 | Current change |
Comparable change |
|---|---|---|---|---|
| Revenue | 900.3 | 719.7 | + 25.1% | + 3.9% |
| Current operating income | 112.5 | 83.4 | + 34.8% | + 0.4% |
| Operating margin | 12.5% | 11.6% | ||
| Booked capital expenditure | 50.4 | 36.7 | + 37.2% | |
| As % of depreciation expense | 89% | 77% |
The business group's end markets, particularly fast-moving consumer goods (food, health, etc.) and intermediate industries (plastic, rubber, filtration, catalysis, etc.) were driven by gradual rebound in the United States and by dynamic emerging countries. In Europe, the business group's greater exposure to fast-moving consumer goods since the integration of Talc limited the impact of a downturn in industrial equipment and construction. Furthermore, demand in Performance Minerals (talc, mica, etc.) benefitted from the growing use of lightweight, impactresistant plastic parts, which is helping to reduce vehicle weight as required in mature markets.
In 2012, the development capital projects launched in 2011 were completed and two new plants came on stream: the US production line for Celite Cynergy™, a proprietary filtration and stabilizing agent for edible liquids (Lompoc, California) and the Filmlink™ production unit on the Ipoh (Malaysia) site, which will serve the fastgrowing personal care market in Asia.
In the United Kingdom, consolidation of Goonvean's kaolin activities, which remains subject to the required administrative authorizations, will enhance the Group's high-purity reserves for performance and ceramic applications.
The business group's revenue totaled €900.3 million in 2012. This + 25.1% increase takes into account:
At comparable structure and exchange rates, the rise in sales (+ 3.9%) results from a positive trend in the price/mix component and from resilient volumes. The Talc activity's growth and innovation potential on diversified markets (plastics & polymers, paint, paper, technical ceramics, beauty & health products) has been confirmed since its consolidation.
Current operating income, at €112.5 million, increased by + €29.1 million, of which + €19.7 million corresponding to Group structure effect and + €5.6 million to foreign exchange effect. At comparable structure and exchange rates, the increase was + 0.4%. The Talc activity is contributive, one year ahead of schedule. The product price/mix effect is firm. In that context, operating margin rose + 0.9 point to 12.5%.
(22% of consolidated revenue)
| (€ millions) | 2012 | 2011 | Current change |
Comparable change |
|---|---|---|---|---|
| Revenue | 859.4 | 796.4 | + 7.9% | - 2.0% |
| Current operating income | 85.6 | 83.2 | + 2.9% | - 4.2% |
| Operating margin | 10.0% | 10.4% | ||
| Booked capital expenditure | 81.6 | 68.7 | + 18.8% | |
| As % of depreciation expense | 118% | 102% |
In 2012, global production of printing and writing paper was close to 2011 volumes. Overall, strong emerging markets (+ 4.7%) offset the erosion in mature countries that has gathered pace since the end of 2011 (- 4.5%). The packaging segment continues to grow.
In addition to extensive overburden and maintenance operations in 2012, capital expenditure was primarily dedicated to the diversification of the business group's product range. Construction of a lime production facility began in 2012, with the view to leverage some of Imerys' calcium carbonate reserves in Brazil (Doresopolis, Minas Geiras). Lime is a mineral specialty used in various forms in the steel, paper, chemicals, environment, agriculture and construction sectors. In Malaysia, the extension of the Ipoh calcium carbonate plant was launched. In Japan, capacity was increased at the Miyagi plant, which was rebuilt after the tsunami, to meet higher demand from its main customer.
The + 7.9% increase in revenue to €859.4 million for 2012, takes into account:
At comparable structure and exchange rates, 2012 revenue decreased slightly (- 2.0%) year-on-year. The product price/mix trend was positive, but volumes shrank because of the exposure to mature regions that were affected by some North American and European customers' rationalization programs in 2011 and 2012.
Current operating income totaled €85.6 million in 2012 (+ €2.4 million) and results from:
At comparable structure and exchange rates, the decrease in current operating income is due to lower volumes. However, actions to reduce production and general expenses limited their impact. The price/mix effect offsets the increasing trend in variable costs (energy, freight). Current operating income also includes revenue from the disposal of real estate assets in Brazil (€4 million).
Taking this item into account, the business group's operating margin was 10% in 2012.
(25% of consolidated revenue)
| (€ millions) | 2012 | 2011 | Current change |
Comparable change |
|---|---|---|---|---|
| Revenue | 969.3 | 1,025.3 | - 5.5% | - 5.9% |
| Current operating income | 192.5 | 209.5 | - 8.1% | - 6.4% |
| Operating margin | 19.9% | 20.4% | ||
| Booked capital expenditure | 19.5 | 24.0 | - 18.9% | |
| As % of depreciation expense | 67% | 77% |
The Refractory Solutions activity (57% of Materials & Monolithics business group's total sales) was affected by lower industrial and steel production in Europe (- 4.7% vs. 2011, source World Steel Association), leading to further blast furnace closures. Other process industries (foundry, power generation, etc.) held out better overall. Trends remained positive on all segments in emerging zones. The project activity (plant modernization, capacity extension or new facility construction) was resilient in the first half.
In the construction sector in France, new single-family housing starts have been decreasing for over a year (- 17% in 2012 vs. 2011(13) ), in line with the trend in house sales. Greater resilience form the roofing renovation segment limited the fall in sales of clay roof tiles (estimated at - 9% for the entire industry in 2012 by the French roof tiles & bricks federation). In structure materials, brick sales lost -14% over that period according to the same source.
13 Source: Ministry of ecology, Sustainable Development and Energy.
In 2012, capital expenditure were mainly targeted at the maintenance of industrial assets, as well as the implementation of projects to reduce the Building Materials' energy footprint, including adjusting equipment to use biomass, recovering temperature, switching to gas and modernization of production lines.
In this more difficult context, the decrease in the business group's revenue (€969.3 million) is limited to - 5.5%, including a positive foreign exchange impact of + €4.8 million. At comparable Group structure and exchange rates, revenue shrank by - 5.9%. The price/mix product effect remained positive.
The Materials & Monolithics business group's current operating income is €192.5 million (including a - €3.2 million foreign exchange effect). At comparable Group structure and exchange rates, current operating income decreased by - 6.4%. The price/mix effect covers inflation in some refractory raw materials and, to a lesser extent, energy. The business group's operating margin was maintained, at 19.9%, thanks to the efforts achieved in both activities to adjust production levels and reduce fixed costs and general expenses. The Monolithic Refractories plant in Köping (Sweden) was closed under that program and its production transferred to the Höganäs site.
On December 12, 2012, the Group also announced that it had received a binding acquisition offer from the Bouyer Leroux group for its activity Imerys Structure (wall and partition blocks, chimney blocks) at an enterprise value close to one year's revenue. Completion of the transaction remains subject in particular to consultation with personnel representation bodies and to the required administrative authorizations being obtained. Closing could take place in the first half of 2013.
| April 25 | Shareholders' General Meeting – 1st quarter 2013 results |
|---|---|
| July 30 | 1st half 2013 results |
| October 30 | 3rd quarter 2013 results |
These dates are given for information only and may be updated on the Group's website www.imerys.com under Finance / Financial Agenda.
The press release is available from the Group's website www.imerys.com and can be accessed from the home page in the News section.
Imerys is holding a presentation meeting today at 10:30am (CET) at "Maison des Arts & Métiers" (9 bis avenue d'Iéna, 75116 Paris) to comment on the 2012 results. This conference will be webcast live on the Group's website.
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The world leader in mineral-based specialty solutions for industry, Imerys transforms a unique range of minerals to deliver essential functions (heat resistance, mechanical strength, conductivity, coverage, barrier effect, etc.) that are essential to its customers' products and manufacturing processes.
Whether mineral components, functional additives, process enablers or finished products, Imerys' solutions contribute to the quality of a great number of applications in consumer goods, industrial equipment or construction. Combining expertise, creativity and attentiveness to customers' needs, the Group's international teams constantly identify new applications and develop high value-added solutions under a determined approach to responsible development. These strengths enable Imerys to develop through a sound, profitable business model.
_______________________________________________________________________________________________________________________________________
More comprehensive information about Imerys may be obtained from its Internet website (www.imerys.com) under Regulated Information, particularly in its Registration Document filed with Autorité des marchés financiers on March 22, 2012 under number D.12-0193 (also available from the Autorité des marchés financiers website, www.amf-france.org). Imerys draws the attention of investors to chapter 4, "Risk Factors", of its Registration Document.
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Warning on projections and forward-looking statements: This document contains projections and other forward-looking statements. Investors are cautioned that such projections and forward-looking statements are subject to various risks and uncertainties (many of which are difficult to predict and generally beyond the control of Imerys) that could cause actual results and developments to differ materially from those expressed or implied.
| Analyst/Investor Relations: | Press Contacts: |
|---|---|
| Pascale Arnaud +33 (0)1 4955 6401 | Pascale Arnaud +33 (0)1 4955 6401 |
| [email protected] | Raphaël Leclerc +33 (0)6 7316 8806 |
| Change in consolidated revenue | % current change |
% Group structure effect |
% foreign exchange effect |
% comparable change (15) |
|---|---|---|---|---|
| Imerys Group | + 5.7% | + 5.2% | + 2.6% | - 2.1% |
| Comparable(2) quarterly change 2012 vs. 2011 | Q1 12 | Q2 12 | Q3 12 | Q4 12 |
|---|---|---|---|---|
| + 0.2% | - 3.1% | - 2.8% | - 2.7% | |
| 2011 vs. 2010 (reminder) | Q1 11 | Q2 11 | Q3 11 | Q4 11 |
| Quarterly change | Q4 2012 | Q4 2011 | Current change |
Comparable change(2) |
|---|---|---|---|---|
| Minerals for Ceramics, Refractories, Abrasives & Foundry |
281.0 | 294.9 | - 4.7% | - 7.6% |
| Performance & Filtration Minerals | 214.3 | 217.6 | - 1.5% | + 4.4% |
| Pigments for Paper & Packaging | 211.4 | 188.6 | + 12.1% | + 2.4% |
| Materials & Monolithics | 215.9 | 235.6 | - 8.4% | - 8.7% |
| Revenue after holding companies & eliminations |
914.6 | 924.6 | - 1.1% | - 2.7% |
| Quarterly change | Q1 12 | Q2 12 | H1 12 | Q3 12 |
|---|---|---|---|---|
| Imerys Group – current change | + 10.4% | + 9.4% | + 9.9% | + 4.4% |
| Imerys Group – comparable change(15) of which: | + 0.2% | - 3.1% | - 1.5% | - 2.8% |
| Minerals for Ceramics, Refractories, Abrasives & Foundry |
+ 0.9% | - 6.2% | - 2.8% | - 1.4% |
| Performance & Filtration Minerals | + 5.7% | + 3.5% | + 4.6% | + 2.4% |
| Pigments for Paper & Packaging | - 3.8% | - 2.4% | - 3.1% | - 3.8% |
| Materials & Monolithics | - 0.5% | - 5.4% | - 3.0% | - 9.2% |
14 Non-audited quarterly information.
15 Change at comparable structure and exchange rates
* Reprocessing the foreign exchange effect consists of calculating aggregates for the current year at the exchange rate for the previous year.
* Reprocessing Group structure to allow for newly consolidated entities consists of:
- for entities entering the structure in the current year, withdrawing the contribution of the acquisition from the aggregates for the current year
- for entities entering the structure in the previous year, withdrawing the contribution of the acquisition from January 1 of the current year to the last day of the month in the current year when the acquisition was completed the previous year.
* Reprocessing of entities leaving the Group structure consists of:
- for entities leaving the structure in the current year, withdrawing the departing entity's contributions from the aggregates for the previous year as from the 1st day of the month of divestment
- for entities leaving the structure in the previous year, withdrawing the departing entity's contributions from the aggregates for the previous year.
| Sales by business group | 2012 | 2011 |
|---|---|---|
| Minerals for Ceramics, Refractories, Abrasives & Foundry | 30% | 32% |
| Performance & Filtration Minerals | 23% | 19% |
| Pigments for Paper & Packaging | 22% | 21% |
| Materials & Monolithics | 25% | 28% |
| Total | 100% | 100% |
| (€ millions) | Q4 2012 | Q4 2011 | Change | H2 2012 | H2 2011 | Change |
|---|---|---|---|---|---|---|
| Revenue | 914.6 | 924.7 | - 1.1 % | 1 898.6 | 1 867.5 | + 1.7 % |
| Current operating income(16) | 101.3 | 105.2 | - 3.5 % | 223.9 | 234.1 | - 4.4 % |
| Current financial income | (13.4) | (11.5) | (24.7) | (26.9) | ||
| Current taxes | (24.4) | (27.5) | (54.4) | (59.4) | ||
| Minority interests | 0.7 | (1.0) | (0.2) | (1.8) | ||
| Net income from current operations(17) |
64.3 | 65.2 | - 1.4 % | 144.6 | 146.0 | - 1.0% |
| Other revenue and expenses, net | (3.3) | (13.7) | (5.7) | (19.0) | ||
| Net income(17) | 61.0 | 51.5 | n.a. | 138.9 | 127.1 | n.a. |
16 Operating income before other operating revenue and expenses.
17 Group's share.
The Board of Directors met on February 13, 2013 to close the financial statements for 2011. Audit procedures have been carried out and the audit reports are being issued.
| (€ millions) | 2012 | 2011 |
|---|---|---|
| Revenue | 3,884.8 | 3,674.8 |
| Current income and expenses | (3,394.7) | (3,187.8) |
| Raw materials and consumables used | (1,377.0) | (1,294.5) |
| External expenses | (1,010.5) | (940.9) |
| Staff expenses | (788.8) | (695.1) |
| Taxes and duties | (51.6) | (45.1) |
| Amortization, depreciation and impairment losses | (214.7) | (210.9) |
| Other current income and expenses | 44.5 | (11.6) |
| Share in net income of joint ventures and associates | 3.4 | 10.3 |
| Current operating income | 490.1 | 487.0 |
| Other operating income and expenses | (9.4) | (23.1) |
| Gain or loss from obtaining or losing control | (8.9) | 7.8 |
| Other non-recurring items | (0.5) | (30.9) |
| Operating income | 480.7 | 463.9 |
| Net financial debt expense | (57.2) | (56.1) |
| Income from securities | 2.0 | 3.0 |
| Gross financial debt expense | (59.2) | (59.1) |
| Other financial income and expenses | (1.5) | (1.1) |
| Other financial income | 134.4 | 178.7 |
| Other financial expenses | (135.9) | (179.8) |
| Financial income (loss) | (58.7) | (57.2) |
| Income taxes | (119.5) | (121.2) |
| Net income | 302.5 | 285.5 |
| Net income, Group share (1) & (2) | 300.8 | 282.0 |
| Net income, share of non-controlling interests | 1.7 | 3.5 |
| (1) Net income per share Basic net income per share (in €) |
4.00 | 3.75 |
| Diluted net income per share (in €) | 3.97 | 3.71 |
|---|---|---|
| (2) Net income from current operations, Group share | 310.2 | 303.1 |
| Basic net income from current operations per share (in €) | 4.13 | 4.03 |
| Diluted net income from current operations per share (in €) | 4.09 | 3.99 |
| Other net operating income and expenses, Group share | (9.4) | (21.1) |
| (€ millions) | 2012 | 2011 |
|---|---|---|
| Non-current assets | 3,212.1 | 3,210.0 |
| Goodwill | 1,003.0 | 1,019.7 |
| Intangible assets | 48.0 | 37.7 |
| Mining assets | 493.4 | 502.9 |
| Property, plant and equipment | 1,408.2 | 1,384.1 |
| Joint ventures and associates | 82.9 | 82.4 |
| Available-for-sale financial assets | 4.5 | 4.8 |
| Other financial assets | 20.4 | 18.5 |
| Other receivables | 68.0 | 74.6 |
| Derivative financial assets | 9.6 | 12.7 |
| Deferred tax assets | 74.1 | 72.6 |
| Current assets | 1,619.6 | 1,746.4 |
| Inventories | 651.1 | 645.9 |
| Trade receivables | 513.8 | 526.9 |
| Other receivables | 134.3 | 141.0 |
| Derivative financial assets | 2.0 | 2.0 |
| Other financial assets | 57.8 | 6.4 |
| Cash and cash equivalents | 260.6 | 424.2 |
| Consolidated assets | 4,831.7 | 4,956.4 |
| Equity, Group share | 2,250.5 | 2,180.1 |
| Capital | 150.7 | 150.3 |
| Premiums | 326.2 | 319.6 |
| Reserves | 1,472.8 | 1,428.2 |
| Net income, Group share | 300.8 | 282.0 |
| Equity, share of non-controlling interests | 24.0 | 30.8 |
| Equity | 2,274.5 | 2,210.9 |
| Non-current liabilities | 1,681.5 | 1,641.2 |
| Employee benefits liabilities | 314.0 | 231.3 |
| Other provisions | 246.4 | 265.2 |
| Loans and financial debts | 1,011.0 | 1,028.4 |
| Other debts | 14.8 | 12.2 |
| Derivative financial liabilities | 3.4 | 9.1 |
| Deferred tax liabilities | 91.9 | 95.0 |
| Current liabilities | 875.7 | 1,104.3 |
| Other provisions | 15.7 | 19.2 |
| Trade payables | 375.2 | 360.0 |
| Income taxes payable | 21.4 | 9.7 |
| Other debts | 272.9 | 261.7 |
| Derivative financial liabilities | 3.7 | 19.0 |
| Loans and financial debts | 167.5 | 422.0 |
| Bank overdrafts | 19.3 | 12.7 |
| Consolidated equity and liabilities | 4,831.7 | 4,956.4 |
| (€ millions) | 2012 | 2011 |
|---|---|---|
| Cash flow from operating activities | 474.5 | 447.4 |
| Cash flow generated by current operations | 663.9 | 638.7 |
| Interests paid | (59.9) | (49.6) |
| Income taxes on current operating income and financial income (loss) | (74.2) | (124.9) |
| Dividends received from available-for-sale financial assets | (0.6) | 0.6 |
| Cash flow generated by other operating income and expenses | (54.7) | (17.4) |
| Cash flow from investing activities | (211.2) | (421.7) |
| Acquisitions of intangible assets and property, plant and equipment | (257.0) | (227.0) |
| Acquisitions of investments in consolidated entities after deduction of cash acquired | (38.9) | (239.2) |
| Acquisitions of available-for-sale financial assets | - | (0.6) |
| Disposals of intangible assets and property, plant and equipment | 86.2 | 8.3 |
| Disposals of investments in consolidated entities after deduction of cash disposed of | - | 33.0 |
| Disposals of available-for-sale financial assets | 0.2 | 0.9 |
| Net change in financial assets | (3.2) | 0.7 |
| Paid-in interests | 1.5 | 2.2 |
| Cash flow from financing activities | (430.5) | 37.4 |
| Capital increases | 7.9 | 5.4 |
| Disposals (acquisitions) of treasury shares | (7.1) | (27.0) |
| Dividends paid to shareholders | (112.8) | (90.6) |
| Dividends paid to non-controlling interests | (1.3) | (0.8) |
| Acquisitions of investments in consolidated entities from non-controlling interests | (4.7) | (1.3) |
| Loan issues | 1.0 | 117.3 |
| Loan repayments | (280.3) | (2.4) |
| Net change in other debts | (33.2) | 36.8 |
| Change in cash and cash equivalents | (167.2) | 63.1 |
| (€ millions) | 2012 | 2011 |
|---|---|---|
| Opening cash and cash equivalents | 411.5 | 347.4 |
| Change in cash and cash equivalents | (167.2) | 63.1 |
| Impact of changes due to exchange rate fluctuations | (3.0) | 1.0 |
| Closing cash and cash equivalents | 241.3 | 411.5 |
| Cash (1) | 260.6 | 216.5 |
| Cash equivalents (2) | - | 207.7 |
| Bank overdrafts | (19.3) | (12.7) |
(1) As of December 31, 2012, cash comprises a balance of €6.9 million (€7.2 million as of December 31, 2011) not available for Imerys SA and its subsidiaries, of which €1.8 million (€2.3 million as of December 31, 2011) with respect to foreign exchange control legislations and €5.1 million (€4.9 million as of December 31, 2011) with respect to statutory requirements.
(2) Cash equivalents are investments with a maturity below three months, indexed on a monetary market rate and that may be disposed of at any time.
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