Earnings Release • May 14, 2020
Earnings Release
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| • | GROUP OVERVIEW | Pag. 3 |
|---|---|---|
| • | KEY FINANCIALS Q1 2020 | Pag. 8 |
| • | OUTLOOK | Pag. 15 |
| • | APPENDIX | Pag. 17 |
This document (the Document) was prepared by ORSERO S.p.A. (Company) only for the purposes of presenting the Company.
The information contained herein may not be complete and exhaustive and no guarantee can be given as to its accuracy.
This Document was drafted on the basis of data and information of the Company and/or in the public domain, and on parameters and assumptions determined in good faith by the Company. However, these parameters and assumptions are not the only ones that could have been selected for the purpose of preparing this Document, therefore the application of additional parameters and assumptions, or the existence of different market conditions, could lead, in good faith, to analyses and assessments that may differ, in whole or in part, from those contained herein.
The information and/or the assessments contained herein have not been subjected to verification by independent experts, and are subject to changes and/or updates. The Company undertakes no obligation to give prior or subsequent communication in the event that any such changes and additions may become necessary or appropriate.
No information contained in this Document can or shall be considered a guarantee or an indication of future operating, financial and equity results of the Company.
To the extent permitted by applicable law, the Company and its corporate officers, managers, employees, and consultants do not make any declaration or guarantee and do not assume any obligation, either express or implied, or responsibility as to the accuracy, sufficiency, completeness and update of any information contained in the Document nor in respect of any errors, omissions, inaccuracies or negligence herein.
This Document is provided merely for information and indicative purposes and does not constitute in any way a proposal to enter into any contract nor a public offering of financial products, nor advice or a recommendation to buy or sell any financial products.
You are the exclusive addressee of this Document which as such cannot be delivered nor disclosed to any third parties nor reproduced, in whole or in part, without the prior authorization of the Company.
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(*)
ORSERO Group among the leader in Mediterranean Europe for the import and distribution of fresh fruit and vegetables active since the 1940.
The Group's Business model is based on two pillars which are also the main Business Sectors: the IMPORT & DISTRIBUTION of a vast array of fresh produce and the SHIPPING of bananas and pineapples using its own ships from Central America to Southern Europe.
Furthermore there is the Service/Holding Sector that provides centralized strategies and corporate services (finance, M&A, ICT, marketing) to both sectors.
The Group generates consolidated sales of one billion €, of which ~ 93% by the Import & Distribution segment.
.
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Sourcing from the world's best production areas to offer a wide and diversified array of fresh produce, thanks to the long-term relationship with industry-leading overseas and local growers/suppliers.
Logistic efficiency also thanks to our owned "Cala Rosse" reefer fleet for bananas and pineapples.
Quality control on product throughout the supply chain
Cool storage network scattered in Southern Europe.
Distinctive expertise at ripening banana and repacking fresh produce.
Deep know-how in fresh-cut and ready-to-eat fresh fruit
Widespread daily distribution and bespoke solutions for retailers and consumers.
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Beginning of our fruit distribution business in Italy.
Development of distribution and import of exotic fruits and counter season fruits.
Investments in the distribution sector in Italy, France, Portugal and Greece. Beginning of the shipping business.
Launch of F.lli Orsero own brand for extra Premium Fruit, as the expression of the tradition and passion of a great family-run company.
Refocusing on the Group's core business. Organisational review and management reinforcement.
Through the merger with Glenalta Food, listing of Orsero shares on the AIM Italia. Full integration of JV's in Spain and Italy: Hermanos Fernández López, Fruttital Firenze and Galandi.
expansion in the distribution sector with the acquisition of Sevimpor. Strengthening of Fresh-cut operation: widening of Florence cutting centre.
Further expansion in the Fresh Cut, opening of 3 new centres inItaly: Molfetta (BA), Verona and Cagliari. Acquisition of 100% of Fruttica Group and of remaining 75% of Fruttital Cagliari. Orsero Shares admitted to trading on the MTA, STAR Segment.
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| BANCA AKROS | Andrea Bonfà |
|---|---|
| BANCA IMI | Gabriele Berti |
| CFO SIM | Luca Arena |
| EQUITA SIM |
Emanuele Gallazzi |
| SPECIALIST | BANCA IMI |
|---|---|
| AUDITING COMPANY | KPMG |
RAFFAELLA ORSERO Deputy Chair and Chief executive Officer
MATTEO COLOMBINI Managing Director and Chief Financial Officer
(*) Shareholdings based on last Shareholders' Meeting deposits ( 30 April 2020). Total shares 17.682.500.
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BUSINESS
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This reorganization reflects the increasing interconnection between the banana and pineapple import business and the distribution business: 85% of the revenues relating to this business are developed through the Group's distribution network.
The new business segmentation will bring a simplification in the understanding of the BU data, reducing the amount of intra-segment revenues originated in the past from Simba and, thus, the elimination among Group's different BU's.
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| M€ | Q1 2020 | Q1 2019 | Total Change | ||
|---|---|---|---|---|---|
| Amount | % | ||||
| Net Sales | 240,9 | 223,2 | 17,7 | 7,9% | |
| Adjusted EBITDA |
9,5 | 6,8 | 2,7 | 38,8% | |
| Adjusted EBITDA Margin |
3,9% | 3,1% | +88bps | ||
| Adjusted EBIT |
3,3 | 1,1 | 2,2 191,8% | ||
| Adjusted Net Profit |
2,3 | ( 1,1) | 3,4 | ns | |
| Non-recurring items (net of tax) | ( 0,6) | ( 0,5) | Ns | ns | |
| Net Profit | 1,8 | ( 1,5) | ns | ns | |
| Adjusted EBITDA excl. IFRS 16(*) |
7,3 | 4,6 | 2,7 | 58,9% | |
| M€ | Q1 2020 | FY 2019 | Total Change Amount |
||
| Net Invested Capital |
284,1 | 277,8 | |||
| Total Equity | 149,7 | 150,9 | |||
| Net Financial Position | 134,4 | 126,9 | |||
| Net Financial Position Ex. IFRS 16(*) | 102,5 | 66,9 |
(*) Data excluding the effect of IFRS 16 adoption, consisting chiefly in the recognition of incremental Adjusted Ebitda of 2,22 M€ in Q1 2019 and 2,16 M€ in Q1 2020 and incremental NFP of 31,9 M€ in Q1 2020 and 60 M€ in FY 2019
(*) Pro-rata revenues of companies acquired in 2019, net of I/co eliminations. See detail in annex.
(**) Data excluding the effect of IFRS 16 adoption, consisting chiefly in the recognition of incremental Adjusted Ebitda of 2,22 M€ in Q1 2019 and 2,16 M€ in Q1 2020 and incremental NFP of 31,9 M€ in Q1 2020 and 60 M€ in FY 2019
Import & Distribution
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(**) 2017 Pro forma data take into account all the effects of the acquisition carried on during the year 2017. Limited to this purpose, the acquired companies have been assumed fully controlled from Jan. 1,2017.
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| ACTUAL Q1 2020 |
GUIDANCE FY 2020 |
ACTUAL FY 2019 |
|
|---|---|---|---|
| Net Sales | 241 M€ | 1.030/1.050 M€ | 1.006 |
| % chg. vs previus period |
+7,9% | +2,4%/+4,4% | |
| Adj. EBITDA excl. IFRS 16 | 7,3 M€ | 37,5/39,5 M€ | 28,9 |
| % chg. vs previus period |
+58,9% | +30%/+37% | |
| Adj. EBITDA | 9,5 M€ | 44,5/46,6 M€ | 38,7 |
| % chg. vs previus period |
+38,8% | +15%/+20% | |
| NFP excl. IFRS 16 | 102,5 M€ | 70/ 75 M€ | 66,9 M€ |
| NFP Reported | 134,4 M€ | 100/105 M€ | 126,9 M€ |
| The Group's strategy is to keep focusing on its core business, with particular regard to fresh fruit and vegetables, strengthening its competitive position in southern Europe, while maintaining a solid financial and asset structure. |
|---|
| In the coming years, the Import & Distribution BU revenue growth drivers will be: |
| - organic growth, which in turn is based on some development guidelines: |
| ‣ limited but steady increase of consumption of fresh Fruit and Vegetables, |
| ‣ consolidation of the European distribution market, |
| ‣ development of products with a greater level of "convenience"/ service such as fresh-cut fruit, portioned and prewashed fruit, exotic fruit and fresh smoothies. |
| - growth by external lines: |
| ‣ acquisitions in the distribution sector; |
| ‣ investment in companies specialized in market segments or high potential product lines, e.g. berries. |
| - reduction of the dependence on bananas, by increasing the weight of the other products. |
| - Import, to maintain the current position in green banana and pineapples, |
| ‣ search for attractive partnerships with growers |
| ‣ monitoring of EUR/USD exchange rate; |
| Medium-long term: increase from ~1% to ~10% the share of distribution sales from all new and added-value product families |
| Shipping, to preserve the value of the ship and trying to mitigate the exposure to the operational risks of this activity: |
| - execution of the mandatory maintenance cycles (Dry-dock), |
| - Reduction of fuel consumption, |
| - BAF Clause (freight rate adjustment on fluctuation of fuel costs) |
| IMO – MARPOL 2020(*), is effective from 1 Jan. 2020: |
This reorganization reflects the increasing interconnection between the banana and pineapple import business and the distribution business: 85% of the revenues relating to this business are developed through the Group's distribution network; in addition.
The new business segmentation will bring a simplification in the understanding of the BU data, reducing the amount of intra-segment revenues originated in the past from Simba and, thus, the elimination among Group's different BU's.
• the Service segment is residual and comprises the parent company Orsero (strategic coordination and promotion/marketing of "F.lli Orsero" brand) and some companies engaged in providing ancillary services (ICT and Customs clearance).
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Note: This slide is an illustrative and simplified company structure showing only the main operating subsidiaries/associates/joint ventures of Orsero Group. If not otherwise specified the companies are intended as wholly owned by the Group.
(1) Acquisition of 100% in Jan. 2019. Line-by-Line consolidation from 1 Jan 2019.
(2) Acquisition of 100% in Mar. 2019. Line-by-Line consolidation from 1 April 2019.
(3) Acquisition of 75% in Jul. 2019 (25% already owned by the Group). Line-by-Line consolidation from 1 July 2019.
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| • The buildings have a total area of approx. 34,200 square meters and are located in Milan, Verona, Rome and Molfetta (BA). |
Location | Total surface (sqm) |
Appraisal CBRE (K€) |
Purchasing Price (K€) |
Discount | ||||
|---|---|---|---|---|---|---|---|---|---|
| PROPERTIES | • The buildings are already deployed as logistic platform by Fruttital, |
Verona | 14.081 | ||||||
| DESCRIPTION | the main distributing company of Orsero Group, under a lease | Milano Roma |
5.880 6.188 |
23.430 | 17.020 | -27,4% | |||
| agreement (stipulated in 2015 and expiring in 2035) at an annual | Molfetta (BA) | 8.069 | |||||||
| rent of approx. € 2.1 million. | Total | 34.218 | |||||||
| Acquisition of 4 properties was finalized in January 2020 though Fruttital; • |
|||||||||
| Purchase price 17 M€, plus charges and taxes, paid at the sign off. • |
|||||||||
| TRANSACTION | This disbursement was financed, for an amount of € 15 million, through a ten-year mortgage loan and, for the remaining part, • with the Group's own resources deriving from the recently made sale of a non-instrumental and non-income building. |
||||||||
| CONDITIONS | The selling party, Nuova Beni Immobiliari S.r.l., is a related party of Orsero since its shareholders' are also shareholders of FIF • Holding. Given the size of the transaction, it is qualified as a "transaction of greater importance with related party". In this respect, an information document pursuant to art. 5 of Consob Regulation no. 17221/2010 is available to the public on the corporate website (www.orserogroup.it). |
||||||||
| The NFP including the effect of IFRS 16 will decrease by abt. 10 M€ • due to the difference between the "right of use" value of the properties (equal to approx. 27.5 M€) and the consideration |
M€ | Main | effects: | ||||||
| ECONOMIC | (indicated above) for the purchase of the properties. | IFRS 16 | NO IFRS 16 | Total | |||||
| • Adjusted Ebitda excl. IFRS16 will increase by 2,1 M€ but is neutral in respect to the Adjusted Ebitda including IFRS 16. |
effect | ||||||||
| AND FINANCIAL | Adjusted EBITDA |
-2,1 | +2,1 | = | |||||
| IMPACT | • Net result will benefit by abt. 0,8 M€ from the positive difference between the incremental costs connected to the ownership of the |
Net Financial Position | -27,5 | +17,7 | -9,8 | ||||
| Properties (property taxes, depreciation etc.) compared to the | Adjusted | EBITDA excl. IFRS 16 | +2,1 | +2,1 | |||||
| decrement of leases previously paid. | Net Financial Position Excl. IFRS 16 | +17,7 | +17,7 |
abt. 1 M€/year.
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| Amounts in €/000 |
Q1 2020 Excl. IFRS 16* |
% | IFRS 16 Effect |
Q1 2020 Reported |
% | Q1 2019 Reported |
% | Reported 31/12/2019 |
% | Reported 31/12/2018 |
% |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Net sales | 240.946 100,0% | - | 240.946 100,0% | 223.218 100,0% | 1.005.718 100,0% | 952.756 | 100,0% | ||||
| - cost of goods sold |
(221.903) | -92,1% | 151 (221.752) | -92,0% | (205.745) | -92,2% | (927.927) | -92,3% | (874.801) | -91,8% | |
| Gross Profit | 19.042 | 7,9% | 151 | 19.194 | 8,0% | 17.473 | 7,8% | 77.792 | 7,7% | 77.956 | 8,2% |
| - overheads |
(16.670) | -6,9% | 24 (16.647) | -6,9% | (16.359) | -7,3% | (67.693) | -6,7% | (67.016) | -7,0% | |
| - other income and expenses |
(165) | -0,1% | 130 | (35) | 0,0% | (598) | -0,3% | (1.720) | -0,2% | 412 | 0,0% |
| Operating Result (Ebit) |
2.208 | 0,9% | 305 | 2.512 | 1,0% | 516 | 0,2% | 8.378 | 0,8% | 11.352 | 1,2% |
| - net financial items and exch. rate |
(239) | -0,1% | (251) | (490) | -0,2% | (1.086) | -0,5% | (4.623) | -0,5% | (2.461) | -0,3% |
| - net result from equity investments |
1 | 0,0% | 1 | 0,0% | 7 | 0,0% | 959 | 0,1% | 1.163 | 0,1% | |
| - Share of net profit of associated/JV |
17 | 0,0% | - | 17 | 0,0% | (48) | 0,0% | 751 | 0,1% | 1.187 | 0,1% |
| Profit before tax |
1.986 | 0,8% | 53 | 2.040 | 0,8% | (612) | -0,3% | 5.465 | 0,5% | 11.241 | 1,2% |
| - tax expenses |
(268) | -0,1% | - | (268) | -0,1% | (906) | -0,4% | (3.201) | -0,3% | (3.239) | -0,3% |
| Net profit | 1.718 | 0,7% | 53 | 1.772 | 0,7% | (1.518) | -0,7% | 2.264 | 0,2% | 8.002 | 0,8% |
| INCOME STATEMENT ADJUSTMENTS: | |||||||||||
| ADJUSTED EBITDA | 7.328 | 3,0% | 2.164 | 9.492 | 3,9% | 6.839 | 3,1% | 38.706 | 3,8% | 32.857 | 3,4% |
| D&A | (3.979) | -1,7% | (1.860) | (5.839) | -2,4% | (5.332) | -2,4% | (23.707) | -2,4% | (13.673) | -1,4% |
| Provisions | (367) | -0,2% | - | (367) | -0,2% | (381) | -0,2% | (2.046) | -0,2% | (1.706) | -0,2% |
| LTI Plan | - | 0,0% | - | - (*) |
0,0% | - | 0,0% | - | 0,0% | (2.142) | -0,2% |
| Non recurring Income |
2 | 0,0% | - | 2 | 0,0% | 0 | 0,0% | 820 | 0,1% | 279 | 0,0% |
| Non recurring Expenses |
(776) | -0,3% | - | (776) | -0,3% | (611) | -0,3% | (5.395) | -0,5% | (4.263) | -0,4% |
| Operating Result (Ebit) |
2.208 | 0,9% | 305 | 2.512 | 1,0% | 516 | 0,2% | 8.378 | 0,8% | 11.352 | 1,2% |
(*) Data excluding the effect of IFRS 16 adoption, consisting chiefly in the recognition of incremental Adjusted Ebitda of 2,22 M€ in Q1 2019 and 2,16 M€ in Q1 2020 and incremental NFP of 31,9 M€ in Q1 2020 and 60 M€ in FY 2019.
| Amounts in €/000 |
Q1 2020 No IFRS 16 |
IFRS 16 Effect |
Q1 2020 Reported |
31/12/2019 Reported |
|---|---|---|---|---|
| - goodwill |
46.828 | - | 46.828 | 46.828 |
| - other intangible assets |
5.251 | - | 5.251 | 5.145 |
| - tangible assets |
138.813 | 31.582 | 170.395 | 181.722 |
| - financial assets |
7.157 | - | 7.157 | 8.117 |
| - other fixed assets |
5.152 | - | 5.152 | 5.401 |
| - deferred tax assets |
9.744 | - | 9.744 | 9.122 |
| Non-Current Assets | 212.946 | 31.582 | 244.528 | 256.336 |
| - inventories |
43.411 | - | 43.411 | 36.634 |
| - trade receivables |
126.452 | - | 126.452 | 121.439 |
| - current tax receivables |
16.468 | - | 16.468 | 16.971 |
| - other current asset |
13.761 | - | 13.761 | 11.066 |
| - cash and cash equivalent |
39.049 | - | 39.049 | 56.562 |
| Current Assets |
239.142 | - | 239.142 | 242.672 |
| Assets held for sale |
- | - | - | - |
| TOTAL ASSETS | 452.088 | 31.582 | 483.670 | 499.008 |
| Amounts in €/000 |
Q1 2020 No IFRS 16 |
IFRS 16 Effect |
Q1 2020 Reported |
31/12/2019 Reported |
|---|---|---|---|---|
| - share capital |
69.163 | - | 69.163 | 69.163 |
| - reserves |
78.679 | (373) | 78.306 | 79.036 |
| - net result |
1.487 | 53 | 1.541 | 2.022 |
| Group Equity | 149.330 | (320) | 149.010 | 150.221 |
| Non-Controlling Interest |
703 | - | 703 | 710 |
| TOTAL SHAREHOLDERS' EQUITY | 150.033 | (320) | 149.713 | 150.931 |
| - non-current financial liabilities |
93.243 | 25.408 | 118.651 | 131.583 |
| - other non-current liabilities |
317 | - | 317 | 349 |
| - deferred tax liabilities |
5.290 | - | 5.290 | 5.216 |
| - provisions for risks and charges |
4.495 | - | 4.495 | 4.345 |
| - employees benefits liabilities |
9.494 | - | 9.494 | 9.422 |
| NON-CURRENT LIABILITIES | 112.839 | 25.408 | 138.248 | 150.915 |
| - current financial liabilities |
48.280 | 6.494 | 54.774 | 51.897 |
| - trade payables |
119.885 | - | 119.885 | 127.523 |
| - current tax and social security liabilities |
5.634 | - | 5.634 | 6.400 |
| - other current liabilities |
15.417 | - | 15.417 | 11.343 |
| CURRENT LIABILITIES | 189.215 | 6.494 | 195.709 | 197.162 |
| Liabilities held for sale | - | - | - | |
| TOTAL LIABILITIES AND EQUITY | 452.088 | 31.582 | 483.670 | 499.008 |
H2= second half (i.e. period 1/7/2019-31/12/2019
HFL = Hermanos Fernández López S.A.
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