Earnings Release • Oct 21, 2020
Earnings Release
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Kortrijk, Belgium, 21 October 2020, 7:30 am – Today Barco (Euronext: BAR; Reuters: BARBt.BR; Bloomberg: BAR BB) announced the results for the third quarter ended 30 September 2020.
The third quarter results continued to reflect varied demand dynamics associated with covid-19 across Barco's regions and divisions. Although orders and sales were significantly below last year, on a quarter-over-quarter basis, sales were essentially flat, and orders grew.
From a regional perspective, sales grew in EMEA markets and were flat in APAC, reflecting economic pick-up in several end markets. Sales declined in the Americas region where the pace of economic recovery in our end markets lags other regions.
Divisional results reflect early indications of economic recovery in the Entertainment and Enterprise divisions. Activity in Healthcare was weaker across all segments and most pronounced in the Americas region as customers reset delivery schedules based on hospital spending priorities.
Enterprise sales began to rebound in the third quarter as demonstrated by a solid pick-up for both the Control Rooms and the ClickShare segments. ClickShare sales continued to steadily improve in line with back-to-office trends and the need for solutions that enable hybrid workspaces. Six months after its launch, ClickShare Conference now accounts for 22% of the ClickShare business.
In Entertainment, both the Cinema and the V&H segments contributed to a modest 3% growth in divisional sales versus Q2 on new build activity for cinema in EMEA and with services rebounding as cinemas reopen.
P 1 / 5
Healthcare reported a slow third quarter, following a very strong first half. As a result, sales year-to-date for Healthcare are now flat. The weak 3Q was driven by short term postponement of investments by hospitals leading to deployment push-outs.
The company continues to execute its plan to align both its activity rate and spending with the impacts of the pandemic by resetting indirect cost levels, next to temporary measures and resource redeployments.
In parallel, the company continues to invest in strategic portfolio innovations and to strengthen commercial activities in selected markets and regions in order to further improve its competitive position.
"While total company topline for the 3rd quarter was flat with the 2nd quarter, we saw improvements in Enterprise and indications of economic recovery in EMEA and parts of APAC. Healthcare delivered a softer quarter, but its fundamentals remain solid. In Entertainment, although the global Cinema and Events segments are clearly riding a roller-coaster, Barco's longer-term growth opportunities remain unchanged. With Clickshare Conference, positive market receptivity is telling us we have the right product at the right time to enable hybrid workplaces, and we are continuing to invest in building awareness."
"At this point, it is clear that 2020 will prove to be an off-year for the Barco P&L. To put the company back on its path to reaching its long-term financial goals, we are resetting expense levels while continuing to invest in strategic growth initiatives," said Jan De Witte, CEO of Barco.
Taking into account the uncertainties associated with the second covid wave, both in terms of its impact on ongoing recovery rates in Europe and delayed recovery in the Americas region, management expects continuous pressure on topline performance.
Given lower volumes, unfavorable mix and continued investments in commercial and innovation strength, we expect a considerable decrease in full year EBITDA margin compared to the first half.
Barco will host a conference call with investors and analysts on 21 October 2020 at 9:00 a.m. CET (3:00 am EST), to discuss the third quarter results and to provide perspective on the current environment and how it is working to mitigate the impact.
Jan De Witte, CEO, Ann Desender, CFO and Carl Vanden Bussche, IRO, will host the call. An audio cast of this conference call will be available on the Company's website www.barco.com by 12:30 p.m. Brussels time (6:30 a.m. EST).
| (in millions of euro) | 3Q20 | Change vs 3Q19 3Q19 |
|||
|---|---|---|---|---|---|
| Order Intake | 157.6 | 275.6 | -42.8% | ||
| Order Intake quarter-over-quarter |
|||||
| (in millions of euro) | 3Q20 | 2Q20 | Change vs 2Q20 |
||
| Order Intake | 157.6 | 145.0 | +8.7% | ||
| Order Intake year-to-date |
|||||
| (in millions of euro) | YTD20 | YTD19 | Change vs YTD19 |
||
| Order intake | 556.3 | 809.4 | -31.3% | ||
| Order Book | |||||
| (in millions of euro) | 30 Sep 2020 |
30 Jun 2020 |
31 Mar 2020 |
31 Dec 2019 |
30 Sep 2019 |
| Order book | 299.1 | 317.2 | 341.8 | 322.3 | 359.1 |
| Sales | |||||
| Sales | |||||
| (in millions of euro) | 3Q20 | 3Q19 | Change vs 3Q19 |
||
| Sales | 167.4 | 266.9 | -37.3% | ||
| 1 year-over-year Sales per division |
|||||
| (in millions of euro) | 3Q20 | 3Q19 | Change vs 3Q19 |
||
| Entertainment | 58.0 | 120.3 | -51.8% | ||
| Enterprise | 50.0 | 77.6 | -35.6% | ||
| Healthcare | 59.3 | 69.0 | -14.0% | ||
| Group | 167.4 | 266.9 | -37.3% |
P 3 / 5 1 The projection activity related to virtual reality solutions has been transferred from the Enterprise division to the Entertainment division to further optimize the development and commercialization. With a sales contribution of less than 4 million euro per quarter, this transfer is not considered material, and therefore the 2019 financials are not restated.
| (in millions of euro) | 3Q20 | 2Q20 | Change vs 2Q20 |
|---|---|---|---|
| Entertainment | 58.0 | 56.5 | +2.7% |
| Enterprise | 50.0 | 45.6 | +9.6% |
| Healthcare | 59.3 | 69.4 | -14.5% |
| Group | 167.4 | 171.5 | -2.4% |
| (in millions of euro) | YTD20 | YTD19 | Change vs YTD19 |
|---|---|---|---|
| Entertainment | 214.2 | 314.8 | -32.0% |
| Enterprise | 162.9 | 251.5 | -35.2% |
| Healthcare | 197.6 | 197.0 | +0.3% |
| Group | 574.7 | 763.4 | -24.7% |
Financial Calendar
2H20 & FY20 Results Thursday 11 February 2021
The information given in this press release has not been reviewed by the statutory auditor.
This press release may contain forward-looking statements. Such statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Barco is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release in light of new information, future events or otherwise. Barco disclaims any liability for statements made or published by third parties and does not undertake any obligation to correct inaccurate data, information, conclusions or opinions published by third parties in relation to this or any other press release issued by Barco.
Barco designs technology to enable bright outcomes around the world. Seeing beyond the image, we develop visualization and collaboration solutions to help you work together, share insights, and wow audiences. Our focus is on three core markets: Enterprise (from meeting, classroom and control rooms to corporate spaces), Healthcare (from the radiology department to the operating room), and Entertainment (from movie theaters to live events and attractions). In 2019, we realized sales of 1.083 billion euro. We have a global team of 3,600 employees, whose passion for technology is captured in 400 granted patents. For more information, visit us on www.barco.com, follow us
on Twitter (@Barco), LinkedIn (Barco), YouTube (BarcoTV), or like us on Facebook (Barco).
© Copyright 2020 by Barco
Carl Vanden Bussche, VP Investor Relations +32 56 26 23 22 or [email protected]
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