Earnings Release • Jul 29, 2021
Earnings Release
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Paris, July 29, 2021, 6:00pm
Enhanced growth and profitability profile as a leading player in light and sustainable construction
"These first-half 2021 record results surpass even our second-half 2020 performance. This success reflects the profound positive changes in our organization from "Transform & Grow" – streamlined, agile and closely aligned with its customers – thanks to our extremely committed teams who have stepped up to the challenge across the globe in this unprecedented period. It also reflects structural changes in our markets, which should show an acceleration in growth over the coming years. With divestitures of €5.3 billion in sales either closed or signed since the end of 2018, the Group continues to optimize its profile. Saint-Gobain is now on a new growth and profitability trajectory and is affirming its position as a leading player in decarbonization solutions for construction and industry, thanks to its comprehensive range of integrated and light solutions providing customers with sustainability and performance.
Against this supportive backdrop, we are targeting a very strong increase in operating income over full-year 2021 to a new all-time high, and for second-half 2021 we are confident in the Group's ability to deliver like-for-like operating income close to the previous record of second-half 2020."
First-half consolidated sales were up 11.9% on first-half 2019 on a like-for-like basis (up 9.0% in the first quarter and 14.7% in the second). This acceleration in organic growth was supported by the Group's comprehensive range of solutions for sustainability and performance. It reflects market share gains and very good momentum across our segments, particularly renovation in Europe, and construction in the Americas and in Asia-Pacific. Overall, our main industrial markets continued their sequential improvement, excluding the automotive market in Europe.
Group volumes were up by 7.6% on first-half 2019 and the price increase accelerated to 4.3% (3.9% versus first-half 2020, of which 2.6% in the first quarter and 5.1% in the second) amid increased energy and raw material cost inflation.
On a reported basis, sales totaled €22,131 million, up 24.6% year-on-year and up 2.1% on firsthalf 2019. The 2.6% negative currency effect compared to first-half 2020 mainly reflects the depreciation of the US dollar, Brazilian real and other emerging country currencies.
Changes in Group structure had a negative 0.2% impact compared to first-half 2020, due to the ongoing optimization of the Group's profile, with total divestitures of €5.3 billion in sales either closed or signed since the end of 2018. The sale of the Pipe business in China was finalized on July 28, while closing of the transaction relating to the sale of Saint-Gobain's Distribution activities in the Netherlands is expected to occur on July 30, 2021.
In terms of acquisitions, the Group has integrated several companies on targeted fast-growing markets such as Brüggemann in turnkey modular timber construction solutions in Germany and Strikolith in exterior insulation systems in the Netherlands. Over the first six months of 2021, Continental Building Products (plasterboard in the US) generated USD 289 million in sales and USD 82 million in EBITDA (versus USD 50 million in first-half 2020), representing an EBITDA margin of 28.4% (20.8% in first-half 2020). Synergies exceeded USD 20 million in the first half of 2021.
Note that in light of the hyperinflationary environment in Argentina, this country which represents less than 1% of the Group's consolidated sales, is excluded from the like-for-like analysis.
Consolidated operating income hit a new record in first-half 2021, at €2,376 million (after €2,028 million in second-half 2020), a like-for-like rise of 53% on first-half 2019.
The Group's operating margin hit another all-time high of 10.7% in first-half 2021 (after a record 10.0% in second-half 2020), compared to 7.6% in first-half 2019.
Over the past 12 months, the Group's operating margin was 10.4% (versus 7.7% in 2018), significantly exceeding the objectives set out in "Transform & Grow", and benefiting from:
HPS sales were up by 2.0% on first-half 2019, benefiting from the improvement in our main industrial markets excluding European automotive. The operating margin was 13.5% versus 13.0% in first-half 2019 and 14.4% in first-half 2018, continuing its sequential improvement after 11.1% in second-half 2020.
Sales in Northern Europe progressed by 9.9% compared to first-half 2019 in a Region in which the UK was the only country to have been severely impacted by the coronavirus pandemic in first-half 2020. All countries in the Region reported growth, due in particular to households reallocating savings towards renovation spending. The operating margin for the Region came in at 7.9% versus 6.0% in first-half 2019, buoyed by good volume trends, an optimized business profile, structural cost reductions and post-coronavirus adaptation measures.
Nordic countries, which were up in first-half 2020, continued to deliver solid growth, particularly thanks to the success of our omnichannel digital strategy in a supportive renovation market. Germany enjoyed stronger momentum on dynamic construction markets, and notably in modular timber construction, other light and sustainable construction, and related construction chemicals applications. The UK saw an acceleration in growth in the period compared to first-half 2019, led by double-digit growth in the second quarter in sales to trade professionals via Distribution, which benefited from the network optimization carried out in 2019 and 2020. Eastern Europe reported robust growth.
Sales for the Southern Europe - Middle East & Africa Region enjoyed strong momentum, up 13.1% on first-half 2019, reflecting the Group's outperformance on flourishing renovation markets and households prioritizing spending on renovation. The operating margin for the Region came in at a record 9.1% (a clear sequential increase after 8.0% in second-half 2020), up from 5.0% in first-half 2019, thanks to the very good volume dynamic in the renovation market, productivity gains from our teams, and the impact of divestments and structural cost reductions.
France's compelling performance drove the Region's growth, with market share gains and robust demand for renovation work which benefited the Group's energy efficiency solutions both manufactured and sold on a large scale thanks to the unrivalled presence of Saint-Gobain's Distribution network, our digital services for trade professionals and our intermediation platform for end-customers. The full impact of France's household stimulus package MaPrimeRénov' for home renovation contributed to the good overall dynamic, with more than 380,000 projects submitted in the first half. In terms of renovation of public buildings, the first effects of the stimulus plan should begin to be felt in late 2021 or early 2022. Spain advanced, particularly in light construction solutions and construction chemicals, despite the closure of a flat glass manufacturing plant in 2020 as part of the optimization of our industrial footprint. Italy continued to benefit from support for energy-efficient renovation in the form of tax credits, which helped accelerate growth. Benelux, which was relatively unaffected by the lockdown measures in first-half 2020, was also up. The acquisition of Strikolith in the Netherlands has enhanced the Group's offering in the fast-growing exterior insulation systems market. Middle East and African countries progressed very strongly.
After delivering an already strong performance with 15.7% growth in the second half of 2020, sales for the Americas were up 25.2% on first-half 2019 in very dynamic markets. The first-half performance also benefited from double-digit price increases. The operating margin for the Region came in at a record 17.0% versus 9.0% in first-half 2019, mainly supported by double-digit growth in volumes and by a clear positive raw material and energy price-cost spread.
The Asia-Pacific Region saw 16.2% organic growth versus first-half 2019, led by China and despite a challenging health situation in India. The operating margin for the Region came in at 11.2%, versus 9.5% in first-half 2019, driven by China and India, despite the challenging health context in the latter.
China reported very dynamic growth, which accelerated in the second quarter versus 2019 thanks to an upbeat market and to market share gains in construction solutions. India rebounded sharply compared to first-half 2020, when the pandemic had caused the country to come to a standstill, and was up slightly on first-half 2019 thanks to increased sales prices. After a good first-quarter 2021 with double-digit organic growth compared to pre-Covid levels, the second quarter was penalized by a deteriorating health situation. South-East Asia reported a very mixed picture in terms of recovery, buoyed by business growth in Vietnam where we continued to capture market share, but with most other countries still below 2019 levels.
A total of 1,000 initiatives have been logged since the launch of the internal Carbon Fund to engage all of the Group's employees on the road to carbon neutrality. First implemented in Northern Europe, it aims to accelerate the reduction of non-industrial CO2 emissions through the everyday actions of employees and targeted investments in sites. This Carbon Fund is based on Saint-Gobain's internal carbon price and converts part of the CO2 emissions reductions achieved into financing for projects which themselves seek to reduce the Group's carbon footprint, creating a virtuous circle.
The Group has recently increased its internal carbon prices to €50 per ton for investment decisions and to €150 per ton for R&D investments in disruptive technologies.
Saint-Gobain has also committed to supporting 1,000 complete energy renovation projects from employees eligible for France's new reinforced MaPrimeRénov' stimulus package.
Elsewhere, the Group has signed Power Purchase Agreements (PPA) which will enable it to achieve almost 40% of green electricity in 2021, double that in 2020. The latest PPA was signed in March for a capacity of 120 megawatts (MW) of a wind farm in the US. The renewable energy certificates related to this agreement represent 40% of the Group's CO2 emissions from electricity in the US.
Each year through to 2030, the Group will also dedicate a budget of €100 million to targeted capital expenditure and research and development to reduce its industrial CO2 emissions.
As part of this, Saint-Gobain is to invest in Fredrikstad in Norway to create the world's first carbonneutral plasterboard plant. This project will eliminate more than 20,000 tons of CO2 emissions per year and reduce the site's energy consumption. This investment is a tangible demonstration of Saint-Gobain's commitment to reduce its scope 1 and 2 emissions by 33% by 2030 compared to 2017, as part of its key target to become carbon neutral by 2050.
Lastly, the Group has recently decided to build a sixth flat glass production plant in India. The plant will enable Saint-Gobain to reduce CO2 emissions by 25% per square meter of flat glass, thanks in particular to heat recovery, the use of recycled cullet and solar panels.
The unaudited interim consolidated financial statements for first-half 2021 were subject to a limited review by the statutory auditors and adopted by the Board of Directors on July 29, 2021.
| % change | |||||
|---|---|---|---|---|---|
| in € million | H1 2019 | H1 2020 | H1 2021 | 2021/2019 | 2021/2020 |
| Sales | 21,677 | 17,764 | 22,131 | 2.1% | 24.6% |
| Operating income | 1,638 | 827 | 2,376 | 45.1% | 187.3% |
| Operating depreciation and amortization | 947 | 950 | 954 | 0.7% | 0.4% |
| Non-operating costs | -168 | -142 | -82 | 51.2% | 42.3% |
| EBITDA | 2,417 | 1,635 | 3,248 | 34.4% | 98.7% |
| Capital gains and losses on disposals, asset write-downs and impact of changes in Group structure |
-217 | -734 | -150 | 30.9% | 79.6% |
| Business income (loss) | 1,253 | -49 | 2,144 | 71.1% | n.s. |
| Net financial expense | -250 | -234 | -213 | 14.8% | 9.0% |
| Dividends received from investments | 28 | 34 | 0 | n.s. | n.s. |
| Income tax | -318 | -183 | -593 | -86.5% | -224.0% |
| Share in net income (loss) of associates | 1 | -1 | 2 | n.s. | n.s. |
| Net income (loss) before non-controlling interests |
714 | -433 | 1,340 | 87.7% | 409.5% |
| Non-controlling interests | 25 | 1 | 42 | 68.0% | n.s. |
| Net attributable income (loss) | 689 | -434 | 1,298 | 88.4% | 399.1% |
| Earnings (loss) per share2 (in €) |
1.27 | -0.81 | 2.45 | 92.9% | 402.5% |
| net income1 Recurring |
944 | 272 | 1,506 | 59.5% | 453.7% |
| Recurring earnings per share2 (in €) |
1.74 | 0.51 | 2.85 | 63.8% | 458.8% |
| EBITDA | 2,417 | 1,635 | 3,248 | 34.4% | 98.7% |
| Depreciation of right-of-use assets | -340 | -336 | -333 | 2.1% | 0.9% |
| Net financial expense | -250 | -234 | -213 | 14.8% | 9.0% |
| Income tax | -318 | -183 | -593 | -86.5% | -224.0% |
| Capital expenditure3 | -682 | -447 | -431 | -36.8% | -3.6% |
| o/w additional capacity investments | 220 | 155 | 121 | -45.0% | -21.9% |
| Changes in working capital requirement4 | -357 | 1,088 | 662 | 285.4% | -39.2% |
| Free cash flow5 | 690 | 1,678 | 2,461 | 256.7% | 46.7% |
| Free cash flow conversion6 | 33% | 129% | 84% | ||
| Lease investments | 353 | 409 | 285 | -19.3% | -30.3% |
| Investments in securities7 | 158 | 1,256 | 91 | -42.4% | -92.8% |
| Divestments | 227 | 2,434 | -79 | -134.8% | -103.2% |
| Consolidated net debt | 12,799 | 9,841 | 7,584 | -40.7% | -22.9% |
Recurring net income = net attributable income excluding capital gains and losses on disposals, asset write-downs and material non-recurring provisions
Calculated based on the weighted average number of shares outstanding (529,188,715 shares in 2021, versus 538,242,661 shares in 2020)
Capital expenditure = investments in tangible and intangible assets
Change in working capital requirement: over a 12-month period (see Appendix 4, bottom of "Consolidated cash flow statement")
Free cash flow = EBITDA less depreciation of right-of-use assets, plus net financial expense, plus income tax, less capital expenditure excluding additional capacity investments, plus change in working capital requirement over a 12-month period
Free cash flow conversion = free cash flow divided by EBITDA, less depreciation of right-of-use assets
Investments in securities: €91 million in first-half 2021, of which €80 million in controlled companies
EBITDA climbed 34.4% versus first-half 2019 to a record €3,248 million, while the EBITDA margin came in at an all-time high of 14.7%, up from 11.2% in first-half 2019.
Non-operating costs fell to €82 million versus €142 million in first-half 2020, with a significant drop in restructuring costs, as expected. The net balance of capital gains and losses on disposals, asset write-downs and the impacts of changes in Group structure represented an expense of €150 million (versus an expense of €734 million in first-half 2020), reflecting €97 million in asset write-downs and €53 million in disposal losses and impacts relating to changes in Group structure. Business income was €2,144 million versus a business loss of €49 million in the first half of 2020.
Net financial expense excluding dividends from investments improved, at €213 million versus €234 million in first-half 2020.
The tax rate on recurring net income was 24.8%, stable compared to first-half 2019. Income tax was €593 million, including an exceptional €105 million which relates to the deferred tax in the UK (liability method) owing to the rise in the corporate income tax rate from 19% to 25%.
Recurring net income hit an all-time high of €1,506 million (excluding capital gains and losses on disposals, asset write-downs and material non-recurring provisions), up from €272 million in first-half 2020 and €944 million in first-half 2019.
Net attributable income amounted to €1,298 million, compared to €689 million in first-half 2019.
Capital expenditure represented €431 million (€447 million in first-half 2020): the abnormally low figure is attributable to availability restrictions due to the coronavirus pandemic. Certain planned growth capex projects – in the Construction Industry and in façade and gypsum solutions in emerging countries (Mexico, India and China) – will be caught up in second-half 2021 and will round out the 13 new plants successfully opened over the past 12 months, mainly to reinforce our leadership on the fast-growing light construction markets in Asia, Africa and Latin America.
Free cash flow jumped 47% versus first-half 2020 to a record €2,461 million, or 11.1% of sales (9.4% of sales in first-half 2020 and 3.2% in first-half 2019), with a free cash flow conversion ratio of 84%, buoyed by an almost two-fold increase in EBITDA and very low levels of working capital requirement and capital expenditure. Operating working capital requirement came in at 25 days' sales at June 30, 2021, compared to 32 days at end-June 2020 (and 41 days at end-June 2019), with significant depletion of inventories in order to ensure the best service for our customers. Inventory levels should be built back up in the second half of 2021.
Investments in securities totaled €91 million (versus €1,256 million in first-half 2020, mainly reflecting the acquisition of Continental Building Products).
Divestments represented an outflow of €79 million (versus an inflow of €2,434 million in first-half 2020 mainly reflecting the sale of Sika shares) and mainly related to the sale of Lapeyre (outflow of €193 million), partly offset by other divestments (Distribution in Spain, advance payment for Pipe in China).
Net debt fell sharply to €7.6 billion at June 30, 2021, from €9.8 billion at end-June 2020, thanks to a sharp rise in free cash flow generation. Excluding IFRS 16, net debt fell to €4.5 billion at June 30, 2021, from €6.7 billion at end-June 2020. Net debt represents 39% of consolidated equity compared to 54% at June 30, 2020. The net debt to EBITDA ratio on a rolling 12-month basis was 1.3 (0.9 excluding IFRS 16) compared to 2.4 (2.0 excluding IFRS 16) at June 30, 2020.
In second-half 2021, against a higher comparison basis and in a macroeconomic and health environment which remains affected by uncertainties, the Group should continue to benefit from strong momentum in its main markets – especially renovation in Europe, as well as construction in the Americas and in Asia-Pacific – and from a solid operating performance. In this environment, and provided there is no new major impact relating to the coronavirus pandemic, Saint-Gobain expects the following trends for its segments:
For full-year 2021, the Group is now targeting a very strong increase in operating income to a new all-time high, with like-for-like operating income in second-half 2021 close to the previous record of second-half 2020.
The Group is ideally placed to assist the growing number of countries committing to carbonneutrality thanks to its light and sustainable construction solutions, which are crucial for achieving this ambition. It is supported by stimulus plans focused on the energy transition across the globe.
Saint-Gobain's structural medium and long-term outlook is robust thanks to its successful strategic and organizational choices, and to the development of a range of integrated solutions for each country and end market. The strategy of differentiation and innovation means that Saint-Gobain is ideally placed to provide its customers with solutions for sustainability and performance. This strategy is perfectly aligned with the Group's purpose of "Making the World a better Home".
| Analyst/Investor relations | Press relations | ||
|---|---|---|---|
| Vivien Dardel | +33 1 88 54 29 77 | Patricia Marie | +33 1 88 54 26 83 |
| Floriana Michalowska | +33 1 88 54 19 09 | Bénédicte Debusschere | +33 1 88 54 14 75 |
| Christelle Gannage | +33 1 88 54 15 49 | Susanne Trabitzsch | +33 1 88 54 27 96 |
- Indicators of organic growth and like-for-like changes in sales/operating income reflect the Group's underlying performance excluding the impact of:
changes in Group structure, by calculating indicators for the year under review based on the scope of consolidation of the previous half-year period (Group structure impact)
changes in foreign exchange rates, by calculating indicators for the year under review and those for the previous year based on identical foreign exchange rates for the previous half-year period (currency impact)
changes in applicable accounting policies
- EBITDA = operating income plus operating depreciation and amortization less non-operating costs
- Operating margin = operating income divided by sales
- Recurring net income = net attributable income excluding capital gains and losses on disposals, asset write-downs and material non-recurring provisions. - Free cash flow = EBITDA less depreciation of right-of-use assets, plus net financial expense, plus income tax, less capital expenditure excluding additional capacity investments, plus change in working capital requirement over a 12-month period
- Free cash flow conversion ratio = free cash flow divided by EBITDA less depreciation of right-of-use assets
- ESG = Environment, Social, Governance
All indicators contained in this press release (not defined above or in the footnotes) are explained in the notes to the financial statements in the interim financial report, available by clicking here: https://www.saint-gobain.com/en/finance/information-reglementee/half-yearlyfinancial-report
| EBITDA | Note 4 |
|---|---|
| Net debt | Note 9 |
| Non-operating costs | Note 4 |
| Operating income | Note 4 |
| Net financial expense | Note 9 |
| Recurring net income | Note 4 |
| Business income | Note 4 |
| Working capital requirement | Note 4 |
This press release contains forward-looking statements with respect to Saint-Gobain's financial condition, results, business, strategy, plans and outlook. Forward-looking statements are generally identified by the use of the words "expect", "anticipate", "believe", "intend", "estimate", "plan" and similar expressions. Although Saint-Gobain believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions as at the time of publishing this document, investors are cautioned that these statements are not guarantees of its future performance. Actual results may differ materially from the forward-looking statements as a result of a number of known and unknown risks, uncertainties and other factors, many of which are difficult to predict and are generally beyond the control of Saint-Gobain, including but not limited to the risks described in the "Risk Factors" section of Saint-Gobain's Universal Registration Document available on its website (www.saint-gobain.com). Accordingly, readers of this document are cautioned against relying on these forward-looking statements. These forward-looking statements are made as of the date of this document. Saint-Gobain disclaims any intention or obligation to complete, update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
This press release does not constitute any offer to purchase or exchange, nor any solicitation of an offer to sell or exchange securities of Saint-Gobain.
For further information, please visit www.saint-gobain.com.
| 2021-2020 | 2021-2019 | ||||||
|---|---|---|---|---|---|---|---|
| I. SALES | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on actual structure basis |
Change on a comparable stucture basis |
Like-for-like change |
Like-for-like change |
| High Performance Solutions | 3,862 | 3,102 | 3,679 | +18.6% | +18.5% | +23.6% | +2.0% |
| Northern Europe | 7,726 | 6,090 | 7,418 | +21.8% | +21.4% | +19.9% | +9.9% |
| Southern Europe - ME & Africa | 7,011 | 5,668 | 7,457 | +31.6% | +34.0% | +34.7% | +13.1% |
| Americas | 2,774 | 2,670 | 3,260 | +22.1% | +19.6% | +32.0% | +25.2% |
| Asia-Pacific | 895 | 655 | 875 | +33.6% | +33.5% | +40.3% | +16.2% |
| Internal sales and misc. | -591 | -421 | -558 | --- | --- | --- | --- |
| Group Total | 21,677 | 17,764 | 22,131 | +24.6% | +24.8% | +27.4% | +11.9% |
| Distribution (Europe) | 9,817 | 7,558 | 9,584 | +26.8% | +29.4% | +28.1% | +13.7% |
| II. OPERATING INCOME | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on an actual structure basis 2021-2020 |
H1 2019 (in % of sales) |
H1 2020 (in % of sales) |
H1 2021 (in % of sales) |
|---|---|---|---|---|---|---|---|
| High Performance Solutions | 502 | 231 | 496 | +114.7% | 13.0% | 7.4% | 13.5% |
| Northern Europe | 460 | 256 | 585 | +128.5% | 6.0% | 4.2% | 7.9% |
| Southern Europe - ME & Africa | 350 | 99 | 680 | +586.9% | 5.0% | 1.7% | 9.1% |
| Americas | 250 | 190 | 555 | +192.1% | 9.0% | 7.1% | 17.0% |
| Asia-Pacific | 85 | 46 | 98 | +113.0% | 9.5% | 7.0% | 11.2% |
| Misc. | -9 | 5 | -38 | n.s. | n.s. | n.s. | n.s. |
| Group Total | 1,638 | 827 | 2,376 | +187.3% | 7.6% | 4.7% | 10.7% |
| Distribution (Europe) | 349 | 137 | 638 | +365.7% | 3.6% | 1.8% | 6.7% |
| III. BUSINESS INCOME | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on an actual structure basis 2021-2020 |
H1 2019 (in % of sales) |
H1 2020 (in % of sales) |
H1 2021 (in % of sales) |
|---|---|---|---|---|---|---|---|
| High Performance Solutions | 458 | 160 | 414 | +158.8% | 11.9% | 5.2% | 11.3% |
| Northern Europe | 250 | -408 | 539 | +232.1% | 3.2% | -6.7% | 7.3% |
| Southern Europe - ME & Africa | 309 | 70 | 604 | +762.9% | 4.4% | 1.2% | 8.1% |
| Americas | 174 | 98 | 524 | +434.7% | 6.3% | 3.7% | 16.1% |
| Asia-Pacific | 81 | 42 | 95 | +126.2% | 9.1% | 6.4% | 10.9% |
| Misc. | -19 | -11 | -32 | n.s. | n.s. | n.s. | n.s. |
| Group Total | 1,253 | -49 | 2,144 | n.s. | 5.8% | -0.3% | 9.7% |
| IV. EBITDA | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on an actual structure basis 2021-2020 |
H1 2019 (in % of sales) |
H1 2020 (in % of sales) |
H1 2021 (in % of sales) |
|---|---|---|---|---|---|---|---|
| High Performance Solutions | 640 | 352 | 596 | +69.3% | 16.6% | 11.3% | 16.2% |
| Northern Europe | 738 | 507 | 897 | +76.9% | 9.6% | 8.3% | 12.1% |
| Southern Europe - ME & Africa | 610 | 368 | 954 | +159.2% | 8.7% | 6.5% | 12.8% |
| Americas | 296 | 298 | 672 | +125.5% | 10.7% | 11.2% | 20.6% |
| Asia-Pacific | 131 | 88 | 142 | +61.4% | 14.6% | 13.4% | 16.2% |
| Misc. | 2 | 22 | -13 | n.s. | n.s. | n.s. | n.s. |
| Group Total | 2,417 | 1,635 | 3,248 | +98.7% | 11.2% | 9.2% | 14.7% |
| V. FREE CASH FLOW | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on an actual structure basis 2021-2020 |
H1 2019 (in % of sales) |
H1 2020 (in % of sales) |
H1 2021 (in % of sales) |
|---|---|---|---|---|---|---|---|
| High Performance Solutions | 263 | 249 | 543 | +118.1% | 6.8% | 8.0% | 14.8% |
| Northern Europe | 204 | 679 | 539 | -20.6% | 2.6% | 11.1% | 7.3% |
| Southern Europe - ME & Africa | 221 | 308 | 675 | +119.2% | 3.2% | 5.4% | 9.1% |
| Americas | 25 | 372 | 567 | +52.4% | 0.9% | 13.9% | 17.4% |
| Asia-Pacific | 65 | 68 | 197 | +189.7% | 7.3% | 10.4% | 22.5% |
| Misc. | -88 | 2 | -60 | n.s. | n.s. | n.s. | n.s. |
| Group Total | 690 | 1,678 | 2,461 | +46.7% | 3.2% | 9.4% | 11.1% |
| VI. CAPITAL EXPENDITURE | H1 2019 (in €m) |
H1 2020 (in €m) |
H1 2021 (in €m) |
Change on an actual structure basis 2021-2020 |
H1 2019 (in % of sales) |
H1 2020 (in % of sales) |
H1 2021 (in % of sales) |
|---|---|---|---|---|---|---|---|
| High Performance Solutions | 165 | 102 | 99 | -2.9% | 4.3% | 3.3% | 2.7% |
| Northern Europe | 169 | 116 | 117 | +0.9% | 2.2% | 1.9% | 1.6% |
| Southern Europe - ME & Africa | 150 | 79 | 96 | +21.5% | 2.1% | 1.4% | 1.3% |
| Americas | 122 | 96 | 79 | -17.7% | 4.4% | 3.6% | 2.4% |
| Asia-Pacific | 58 | 40 | 35 | -12.5% | 6.5% | 6.1% | 4.0% |
| Misc. | 18 | 14 | 5 | n.s. | n.s. | n.s. | n.s. |
| Group Total | 682 | 447 | 431 | -3.6% | 3.1% | 2.5% | 1.9% |
| 2021-2020 | 2021-2019 | ||||||
|---|---|---|---|---|---|---|---|
| SALES | Q2 2019 (in €m) |
Q2 2020 (in €m) |
Q2 2021 (in €m) |
Change on an actual structure basis |
Change on a comparable structure basis |
Like-for-like change |
Like-for-like change |
| High Performance Solutions | 1,969 | 1,390 | 1,868 | +34.4% | +34.7% | +38.3% | +1.4% |
| Northern Europe | 4,066 | 2,871 | 4,031 | +40.4% | +39.7% | +36.4% | +14.5% |
| Southern Europe - ME & Africa | 3,625 | 2,685 | 3,931 | +46.4% | +51.2% | +51.9% | +16.5% |
| Americas | 1,467 | 1,300 | 1,748 | +34.5% | +32.4% | +42.1% | +26.3% |
| Asia-Pacific | 469 | 318 | 458 | +44.0% | +43.7% | +49.2% | +16.9% |
| Internal sales and misc. | -297 | -163 | -284 | --- | --- | --- | --- |
| Group Total | 11,299 | 8,401 | 11,752 | +39.9% | +40.8% | +42.2% | +14.7% |
| Distribution (Europe) | 5,177 | 3,632 | 5,168 | +42.3% | +46.2% | +43.7% | +18.0% |
| in € million | Dec 31, 2020 | June 30, 2021 |
|---|---|---|
| Assets Goodwill Other intangible assets Property, plant and equipment Right-of-use assets Investments in equity-accounted companies Deferred tax assets Pension plan surpluses - assets Other non-current assets |
10,028 2,505 11,072 2,902 462 665 334 511 |
10,234 2,457 11,048 2,844 506 640 509 468 |
| Non-current assets | 28,479 | 28,706 |
| Inventories Trade accounts receivable Current tax receivable Other receivables Assets held for sale Cash and cash equivalents |
5,362 4,597 147 1,269 329 8,443 |
5,893 6,049 129 1,478 457 6,604 |
| Current assets | 20,147 | 20,610 |
| Total assets | 48,626 | 49,316 |
| Equity and Liabilities Shareholders' equity Non-controlling interests |
17,892 311 |
18,961 349 |
| Total equity | 18,203 | 19,310 |
| Non-current portion of long-term debt Non-current portion of long-term lease liabilities Provisions for pensions and other employee benefits Deferred tax liabilities Other non-current liabilities and provisions |
10,179 2,442 2,629 360 965 |
9,291 2,381 2,531 450 1,013 |
| Non-current liabilities | 16,575 | 15,666 |
| Current portion of long-term debt Current portion of long-term lease liabilities Current portion of other liabilities and provisions Trade accounts payable Current tax liabilities Other payables Liabilities held for sale Short-term debt and bank overdrafts |
1,846 656 361 5,897 175 3,911 501 501 |
1,220 665 387 6,753 235 4,184 265 631 |
| Current liabilities | 13,848 | 14,340 |
| Total equity and liabilities | 48,626 | 49,316 |
| in € million | H1 2020 | H1 2021 |
|---|---|---|
| Operating Income | 827 | 2,376 |
| Operating depreciation and amortization Non-operating costs |
950 (142) |
954 (82) |
| EBITDA | 1,635 | 3,248 |
| Depreciation of right-of-use assets Net financial expense |
(336) (234) |
(333) (213) |
| Income tax | (183) | (593) |
| Capital expenditure | (447) | (431) |
| o/w additional capacity investments | 155 | 121 |
| Changes in working capital requirement over a 12-month period | 1,088 | 662 |
| o/w changes in inventories | 444 | (294) |
| o/w changes in trade accounts receivable and payable, and other accounts receivable and payable | 571 | 798 |
| o/w changes in tax receivable and payable | 73 | 158 |
| Free cash flow | 1,678 | 2,461 |
| Changes in deferred taxes and provisions for other liabilities and charges | 42 | 155 |
| Additional capacity investments | (155) | (121) |
| Increase (decrease) in amounts due to suppliers of fixed assets | (191) | (129) |
| Cancellation of WCR over a 12-month period from FCF calculation | (1,088) | (662) |
| Changes in working capital requirement end of period: | (483) | (969) |
| o/w changes in inventories | 129 | (575) |
| o/w changes in trade accounts receivable and payable, and other accounts receivable and payable | (596) | (483) |
| o/w changes in tax receivable and payable | (16) | 89 |
| Depreciation of right-of-use assets | 336 | 333 |
| Purchases of right-of-use assets | (409) | (285) |
| Other operating cash items | (12) | 10 |
| Net cash from operating activities after additional capacity investments and IFRS16 | (282) | 793 |
| Acquisitions of shares in controlled companies | (1,188) | (80) |
| Debt acquired | (108) | 4 |
| Acquisitions of other investments | (52) | (11) |
| Financial investments | (1,348) | (87) |
| Disposals of property, plant and equipment and intangible assets | 89 | 69 |
| Disposals of shares in controlled companies, net of net debt divested | (49) | (164) |
| Disposals of other investments | 2,388 | 2 |
| (Increase) decrease in amounts receivable on sales of fixed assets | 6 | 14 |
| Divestments | 2,434 | (79) |
| Increase (decrease) in investment-related liabilities | 0 | 20 |
| (Increase) decrease in loans and deposits | (24) | 76 |
| Net cash from (used in) financial investments and divestments activities | 1,062 | (70) |
| Issues of capital stock | 0 | 199 |
| (Increase) decrease in treasury stock | (184) | (448) |
| Dividends paid | 0 | (698) |
| Capital increases in non-controlling interests | 2 | 2 |
| Changes in investment-related liabilities following the exercice of put options of minority interests | (5) | (5) |
| Acquisitions of minority interests without gain of control | (15) | 0 |
| Dividends paid to non-controlling interests | (33) | (19) |
| Change in dividends payable | 15 | 1 |
| Net cash from (used in) financing activities | (220) | (968) |
| Net effect of exchange rate changes on net debt | 136 | (29) |
| Net effect of changes in fair value on net debt | (4) | (42) |
| Net debt classified as assets and liabilities held for sale | 0 | (69) |
| Impact of remeasurements of lease liabilities | (42) | (18) |
| Increase (decrease) in net debt | 650 | (403) |
| Net debt excluding lease liabilities at beginning of period | (7,274) | (4,083) |
| Lease liabilities at beginning of period Net debt at beginning of period |
(3,217) (10,491) |
(3,098) (7,181) |
| Net debt excluding lease liabilities at end of period | (6,651) | (4,538) |
| Lease liabilities at end of period | (3,190) | (3,046) |
| Net debt at end of period | (9,841) | (7,584) |
| a. Change in WCR - H1 Year N-1 | (1,493) | (483) |
| b. Change in WCR - H2 Year N-1 | 1,571 | 1,631 |
| Change in WCR - Year N-1 = a. + b. | 78 | 1,148 |
| c. Change in WCR - H1 Year N | (483) | (969) |
| Change in WCR from June 30, N-1 to June 30, N = b. + c. | 1,088 | 662 |
Comments
| Amount and structure of net debt | €bn | |
|---|---|---|
| Gross debt excluding lease liabilities Lease liabilities Cash & cash equivalents Net debt |
11.1 3.1 -6.6 7.6 |
At end-June 2021, 90% of gross debt excluding lease liabilities was at fixed interest rates and its average cost was 2% |
| Breakdown of gross debt excluding lease liabilities | 11.1 | |
|---|---|---|
| Bond debt and perpetual notes | 9.7 | |
| March 2022 | 0.9 | |
| October 2022 | 0.1 | |
| April 2023 | 0.7 | |
| September 2023 | 0.5 | |
| December 2023 | 0.4 | |
| March 2024 | 0.7 | |
| June 2024 | 0.1 | |
| November 2024 | 0.4 | (GBP 0.3bn) |
| March 2025 | 0.8 | |
| March 2026 | 0.8 | |
| After 2026 | 4.4 | |
| Other long-term debt | 0.5 | (including €0.3bn long-term securitization) |
| Short-term debt | 0.9 | (excluding bonds) |
| Negotiable European Commercial Paper (NEU CP) | 0.0 | Maximum amount of issuance program: €4bn |
| Securitization | 0.5 | USD securitization and current portion of EUR securitization |
| Local debt and accrued interest | 0.4 | Frequent rollover; many different sources of financing |
| Credit lines, cash & cash equivalents | 10.6 | |
|---|---|---|
| Cash and cash equivalents Back-up credit-lines |
6.6 4.0 |
See breakdown below |
Breakdown of back-up credit lines and short term line 4.0
All lines are confirmed and undrawn, with no Material Adverse Change (MAC) clause
| Expiry | Covenants | ||
|---|---|---|---|
| Syndicated line: | €2.5bn | December 2024 | None |
| Syndicated line: | €1.5bn | December 2024 | None |
| H1 2021, in % of total | Like-for-like change 2021-2020 |
Like-for-like change 2021-2019 |
% Group |
|---|---|---|---|
| High Performance Solutions | +23.6% | +2.0% | 16.4% |
| Mobility | +31.2% | -3.3% | 6.3% |
| Other industries | +19.3% | +5.5% | 10.1% |
| Northern Europe | +19.9% | +9.9% | 32.6% |
| Nordics | +7.8% | +11.8% | 13.3% |
| United Kingdom - Ireland | +46.7% | +6.2% | 10.2% |
| Germany - Austria | +14.3% | +6.8% | 3.3% |
| Southern Europe - ME & Africa | +34.7% | +13.1% | 32.8% |
| France | +37.2% | +14.4% | 25.4% |
| Spain - Italy | +30.3% | +5.5% | 3.5% |
| Americas | +32.0% | +25.2% | 14.5% |
| North America | +26.1% | +19.9% | 10.5% |
| Latin America | +50.1% | +37.1% | 4.0% |
| Asia-Pacific | +40.3% | +16.2% | 3.7% |
| Group Total | +27.4% | +11.9% | 100% |
| Q2 2021, in % of total | Like-for-like change 2021-2020 |
Like-for-like change 2021-2019 |
% Group |
|---|---|---|---|
| High Performance Solutions | +38.3% | +1.4% | 15.7% |
| Mobility | +64.6% | -5.4% | 5.9% |
| Other industries | +26.6% | +5.8% | 9.8% |
| Northern Europe | +36.4% | +14.5% | 33.4% |
| Nordics | +13.1% | +16.7% | 13.8% |
| United Kingdom - Ireland | +109.9% | +12.4% | 10.5% |
| Germany - Austria | +26.3% | +9.0% | 3.3% |
| Southern Europe - ME & Africa | +51.9% | +16.5% | 32.6% |
| France | +54.6% | +17.9% | 25.3% |
| Spain - Italy | +50.5% | +8.6% | 3.5% |
| Americas | +42.1% | +26.3% | 14.6% |
| North America | +34.3% | +20.2% | 10.7% |
| Latin America | +72.0% | +41.2% | 3.9% |
| Asia-Pacific | +49.2% | +16.9% | 3.7% |
| Group Total | +42.2% | +14.7% | 100% |
| 2021-2020 | 2021-2019 | |||||
|---|---|---|---|---|---|---|
| H1 2021 | Like-for-like change |
Prices | Volumes | Like-for-like change |
Prices | Volumes |
| High Performance Solutions | +23.6% | -0.3% | +23.9% | +2.0% | +0.2% | +1.8% |
| Northern Europe | +19.9% | +3.7% | +16.2% | +9.9% | +3.7% | +6.2% |
| Southern Europe - ME & Africa | +34.7% | +2.9% | +31.8% | +13.1% | +3.9% | +9.2% |
| Americas | +32.0% | +10.6% | +21.4% | +25.2% | +10.3% | +14.9% |
| Asia-Pacific | +40.3% | +3.7% | +36.6% | +16.2% | +2.4% | +13.8% |
| Group Total | +27.4% | +3.9% | +23.5% | +11.9% | +4.3% | +7.6% |
| 2021-2020 | 2021-2019 | |||||
|---|---|---|---|---|---|---|
| Q2 2021 | Like-for-like change |
Prices | Volumes | Like-for-like change |
Prices | Volumes |
| High Performance Solutions | +38.3% | -1.0% | +39.3% | +1.4% | -1.3% | +2.7% |
| Northern Europe | +36.4% | +5.0% | +31.4% | +14.5% | +5.2% | +9.3% |
| Southern Europe - ME & Africa | +51.9% | +3.9% | +48.0% | +16.5% | +4.9% | +11.6% |
| Americas | +42.1% | +13.7% | +28.4% | +26.3% | +12.9% | +13.4% |
| Asia-Pacific | +49.2% | +4.7% | +44.5% | +16.9% | +3.4% | +13.5% |
| Group Total | +42.2% | +5.1% | +37.1% | +14.7% | +5.3% | +9.4% |
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