Group's position at October 27, 2020
Interim financials at August 31, 2020
GROUP POSITION AT OCTOBER 27, 2020
THE "LET'S GO BEYOND!" STRATEGIC PLAN IS MOVING FORWARD IN LINE WITH ITS SCHEDULE
Presented on July 9, 2020, the "Let's Go Beyond!" plan is in its execution phase:
- Overhauling the House of Brands:
- Realignment of the product offering around 8 strong brands
- Rationalization which has already enabled the Group to reduce its investments by 30% in 2020 compared with 2019 (-€26m), while covering the same number of market segments
- Strong creation activity maintained: 18 new models presented this summer, with others currently being prepared, aimed at very promising segments, such as small motor catamarans or electric lake and river boats
Industrial strategy:
Implementation of the Boat Division's industrial strategy focused in particular on:
- Increasingly specialized production sites for each size and type of boat
- Accelerating development cycles
IN AN ADVERSE ENVIRONMENT, THE GROUP IS BENEFITING FROM ITS GLOBAL MULTI-SPECIALIST POSITIONING
- The exit from the lockdown enabled the Group to achieve better revenues than forecast for June-August 2020, for both the Boat business and Housing, thanks in particular to a sustained level of deliveries during the summer period and lower-than-expected order deferrals.
- Covering all recreational boat segments, the Group is benefiting from sales growth in the dayboating segment (motorboats up to 45 feet), partially offsetting the contraction in charter sales (mono and multihull sailing) and inboard motorboats.
HOWEVER, THE GROUP'S BUSINESS DURING THE LAST FOUR MONTHS OF 2020 WILL BE DOWN YEAR-ON-YEAR
OUTLOOK:
For the period from September to December 2020, revenues* are expected to be down 25% to 30% compared with the same period in 2019, linked primarily to the significant contraction in business for charter firms and invoicing for the Housing Division.
IMPACT OF STRONG SEASONALITY:
Taking into account the strong seasonality of its activities, the Group's EBITDA** and income from ordinary operations for the period from September to December are traditionally negative. The pro forma figures for this period in 2019 show -€8.1m of EBITDA and -€35.3m of income from ordinary operations, with revenues of €247.8m.
NON-CURRENT ITEMS:
- The non-current items relating to the "Let's Go Beyond!" plan and the industrial adaptation measures will primarily be recognized in the accounts at end-December 2020, factoring in the employee negotiations underway in France and Italy.
- At this stage, they are estimated at €75m to €90m, including:
- Asset writedowns, resulting from the product plan based on the "Let's Go Beyond!" strategic plan
- Costs for adapting production capacity and fixed costs in line with the expected changes in the markets post-Covid-19
5
THE GROUP HAS THEREFORE QUICKLY DEPLOYED THE MEASURES NEEDED TO ADAPT TO THIS ENVIRONMENT, IN LINE WITH ITS PREVIOUS ANNOUNCEMENTS
- Adjustment of production capacity in line with market developments for the Boat Division in each country:
- Hibernating, closing or selling 5 sites
- Transferring production to the other sites
- Deploying partial activity measures in France and Italy
- New innovative initiatives to respond to the cancellation of most shows
- Organizing private events and exclusive days (Monaco, Cannes/Mandelieu-la-Napoule, La Rochelle/Les Sables d'Olonne, Spain, Italy, UK, Germany, USA, etc.)
- Opening virtual shows (December 10-12, 2020) and creating new digital formats that are more immersive and interactive
- The Housing Division is safeguarding its production capacity with a view to capitalizing on the upturns on its domestic and international markets expected for 2022-2023
- Alongside this, direct and indirect fixed costs are being reduced for the Group's 2 business lines
- All of these adaptation measures, accompanied by partial activity measures, should make it possible to reduce the Group's costs by €45m to €65m on a full-year basis (including €25m to €35m of fixed costs)
OVERVIEW OF THE CONSOLIDATED ACCOUNTS AT AUGUST 31, 2020
INTERIM RESULTS FOR 12 MONTHS OF A 16-MONTH TRANSITION YEAR THAT WILL END ON DECEMBER 31, 2020
- Revenues* down -14% vs 2019, higher than forecast (guidance: -16% / -18%), supported by a dynamic end to the season for the dayboating segment (motorboats up to 45 feet) and a good level of execution for leisure home deliveries
- EBITDA** margin close to 10% (guidance >8%), thanks to the cost variabilization measures put in place from the first weeks of the lockdown
- Income from ordinary operations rate of 2.6%, also higher than forecast, starting to benefit from the investment rationalization plan
KEY FIGURES FOR EACH BUSINESS
| €M AT AUGUST 31 |
2019-20 |
2018-19 |
CHANGE
(reported
data) |
CHANGE
(constant
exchange
rates) |
| GROUP REVENUES |
1,149.2 |
1,336.2 |
-14% |
-14.3% |
-
Boats
-
Housing |
975.3
173.9 |
1,143.7
192.5 |
-14.7%
-9.7% |
-15.1%
-9.7% |
GROUP EBITDA*
%
EBITDA / revenues |
110.4
9.6% |
162
12.1% |
-31.9% |
-34% |
-
Boats
-
Housing |
94.3
16.1 |
144
18 |
-34.5%
-10.5% |
-36.9%
-10.6% |
GROUP INCOME FROM
ORDINARY OPERATIONS
% income from ordinary
operations / revenues |
30
2.6% |
82
6.1% |
-63.4% |
-67.5% |
-
Boats
* Adjusted 2018-19 EBITDA data
-
Housing |
19.3
10.7 |
68.9
13.1 |
-72%
-18.6% |
-76.8%
-18.7% |
EBITDA
Close to 10% maintained for both divisions.
INCOME FROM ORDINARY OPERATIONS – BOAT DIVISION
Over 2% maintained, thanks to the adaptation measures rolled out since the start of H2.
INCOME FROM ORDINARY OPERATIONS – HOUSING DIVISION
Over 6% maintained, thanks to the sustained level of deliveries in the 4th quarter.
REVENUES AT END-AUGUST 2020 – BOAT DIVISION
|
|
2019-20 |
2018-19 |
Change |
|
| €m |
|
|
|
Reported
data |
Constant
exchange
rates |
JUN
AUG |
BOATS |
352.1 |
385.5 |
-8.7% |
-8.5% |
|
Europe |
209.9 |
189.2 |
+10.9% |
+10.9% |
|
Americas |
95.9 |
127.6 |
-24.8% |
-24.3% |
|
Other regions |
36.7 |
41.3 |
-11% |
-10.9% |
|
Fleets |
9.6 |
27.4 |
-65% |
-64.8% |
12
MONTHS |
BOATS |
975.3 |
1,143.7 |
-14.7% |
-15.1% |
|
Europe |
502.8 |
588.6 |
-14.6% |
-14.6% |
|
Americas |
250.7 |
326.9 |
-23.3% |
-24.5% |
|
Other regions |
83.2 |
99.1 |
-16% |
-16.1% |
|
Fleets |
138.6 |
129.1 |
+7.4% |
+7.3% |
FLEETS
7% growth over 12 months following an excellent first half, affected by a high number of deferrals in the second half of the year.
EUROPE
15% contraction at end-August, with 10% growth for the last quarter, marked by a strong upturn in demand for outboard boats.
NORTH AND CENTRAL AMERICA
Down -23% at end-August, focused on the American brands (-40%).
SAILING / MOTOR BREAKDOWN
First-half growth with fleet sales for charter clients, increasing the sailing percentage by 3 points, up to 49% vs 51% for motor.
REVENUES AT END-AUGUST 2020 – HOUSING DIVISION
| €m |
|
|
|
Change |
|
|
2019-20 |
2018-19 |
Reported
data |
JUN
AUG |
HOUSING |
28.4 |
20.7 |
+37.2% |
|
France |
21.3 |
16.4 |
+30.2% |
|
Export |
7.1 |
4.4 |
+63.5% |
12
MONTHS |
HOUSING |
173.9 |
192.5 |
-9.7% |
|
France |
142.9 |
159.5 |
-10.4% |
|
Export |
31 |
33 |
-6.3% |
FRANCE
The shipment plan's effective execution in the 4th quarter made it possible to catch up on deliveries that were not able to go ahead in the 3rd quarter due to the Covid-19 crisis, without however offsetting deferred or cancelled orders.
EXPORT
Good resilience for export sales (-6%), supported by progress with sales for Northern Europe.
BREAKDOWN OF INCOME FROM ORDINARY OPERATIONS AT END-AUGUST 2019-20
€53.6M IMPACT FOR THE COVID-19 CRISIS ON INCOME FROM ORDINARY OPERATIONS:
- Contraction in business (-€67.4m) for the Boat Division (-€60m excluding American brands) and Housing (-€7.4m)
- Remaining cost of the partial activity measures rolled out (-€9.6m)
- Measures deployed to reduce indirect costs (+€8.7m)
- Impact on profit-sharing and incentive plans (+€14.8m)
SLIGHT IMPROVEMENT IN INCOME FROM ORDINARY OPERATIONS EXCLUDING COVID-19 (+€1.6M):
- Increase in depreciation (-€2m), concentrated over the first half of the year, then stabilized in the second half
- Non-recurring items from the first half of the year(-€4.2m) offset in the second half (+€4.3m)
- Favorable change in the foreign exchange effect (+€3.3m)
CASH POSITION
NET CASH POSITION – End of period
€90M OF FREE CASH FLOW AT END-AUGUST (vs -€6.5M IN 2018-19):
- Income from ordinary operations of €30m
- Inventory reduction for €40m
- Scaling back of investments by €26.5m vs 2019
- Improvement in working capital requirements by €12m, resulting from the strong level of shipments at the end of the season
€156M OF NET CASH
- €58m improvement vs August 31, 2019
- Including a +€9m technical increase in financial debt, resulting from the recognition of leases under financial liabilities with the transition to IFRS 16
FEBRUARY 25, 2020
- 2019-20 full-year revenues (16 months)
- Press release followed by a conference call
MARCH 17, 2020
- 2019-20 full-year earnings (16 months)
- Press release followed by a conference call
FINANCIAL GLOSSARY
AT CONSTANT EXCHANGE RATES Change calculated based on figures for the interim period from September 1, 2019 to August 31, 2020 converted at the exchange rate for FY 2018-19.
REVENUES In connection with changes to its commercial processes launched during the first half of 2020, Groupe Beneteau has changed the invoicing date for boats produced in Europe, previously based on when boats were made available at the yard, while invoices are now issued on the date when boats are shipped to dealer clients, consistent with the recognition of revenues. This change is effective at the end of the interim period at August 31, 2020.
- EBITDA Earnings before interest, taxes, depreciation and amortization, and IFRS 2 and IAS 19 adjustments following IFRS GAAP, i.e. income from ordinary operations restated for allocation / reversal of provisions for liabilities and charges, depreciation charges and IFRS GAAP (IFRS 2 and IAS 19).
- FREE CASH FLOW Cash generated by the company during the reporting period before dividend payments, changes in treasury stock and the impact of changes in scope.
- NET CASH Cash and cash equivalents after deducting financial debt and borrowings, excluding financial debt with floor plan-related financing organizations.
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