Earnings Release • Feb 13, 2019
Earnings Release
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PARIS, FEBRUARY 13, 2019
"In 2018, Imerys continued to deliver revenue growth, increased net income from current operations in line with its guidance and generated a solid net current free operating cash flow. We have divested the Roofing activity, the last remaining building materials business in the portfolio, and implemented decisive actions to address adverse market changes in some of our operations. Imerys is entering 2019 with a stronger balance sheet, an improved growth profile as a world leader in specialty minerals and a new, more customer focused organization. Considering a still volatile and uncertain market environment, the Group will continue to sustain its performance by giving priority to cost and cash management in 2019."
On February 13, 2019, Imerys' Board of Directors examined the definitive financial statements for 2018. These will be submitted for approval to the Shareholders' General Meeting on May 10, 2019. The consolidated financial statements have been audited and the related certification report will be published once the Management Report prepared by the Board of Directors has undergone its final review and the procedures required to file the Registration Document have been completed. All financial data included in this press release are presented excluding the Roofing division in 2017 and 2018, unless otherwise specified.
| Consolidated results (€ millions) | 2017 | 2018 | Change |
|---|---|---|---|
| Revenue | 4,299.0 | 4,590.0 | + 6.8 % |
| Current operating income5 | 551.2 | 562.1 | + 2.0 % |
| Current operating margin | 12.8% | 12.2% | - 0.6 pt |
| Net income from current operations, Group share | 335.1 | 356.8 | + 6.5 % |
| Net income, Group share | 368.2 | 559.6 | + 52.0 % |
| Net current free operating cash flow | 293.8 | 285.8 | - 2.7% |
| Net financial debt | 2,246.4 | 1,297.4 | - 42.2% |
| Net income from current operations, Group share, per share6 | 4.24 | 4.50 | + 6.2 % |
| Proposed dividend per share | 2.075 | 2.150 | + 3.6 % |
1 Throughout this press release, "current" means " before other operating income and expenses", as defined in the notes to the financial statements relating to the consolidated income statement.
2 As a reminder, on October 31, 2018, the Group published an objective to increase 2018 net income from current operations by close to + 7% year on year, assuming no further change in market conditions and including external growth.
3 Net current free operating cash flow: current EBITDA after notional tax, changes in working capital requirement and paid capital expenditure.
4 Proposal made by the Board of Directors and submitted for approval at the Shareholders' General Meeting held on May 10, 2019.
5 Operating income as presented in the Group's financial statements, including other income and operating expenses and excluding income from discontinued activities, amounted to income of €499.1 million in 2017 and an expense of -€89.4 million in 2018.
6 In 2018 the weighted average number of outstanding shares reached 79,238,417 in 2018 compared with 79,015,367 in 2017.
In 2018, Imerys has continued to reshape its business portfolio to reposition itself as a specialty minerals company and to improve its growth profile:
The Group has also made the following strategic decisions:
On December 1, 2018, the Group put in place a new structure, with less layers of management, that is simpler and more customer focused, organized around two segments and grouping five newly created business areas, to focus on Imerys' core markets. The General Managers of the five business areas will report directly to the Chief Executive Officer:
This new organization will enable us to achieve our full organic growth potential and to further improve our competitive position for sustained value creation.
To mirror this new structure, a new Executive Committee has been appointed.
Certain subsidiaries of the Group, which operate its talc business in North America, are among the defendants in the actions brought before several U.S. federal and state courts by multiple plaintiffs. In these matters, the plaintiffs assert claims based on the alleged hazards related to the use of talc in certain products. Most of this litigation relates to sales made prior to Imerys's 2011 acquisition of its Talc business.
After evaluating a range of possible options, the three talc subsidiaries of Imerys – Imerys Talc America, Imerys Talc Vermont, and Imerys Talc Canada – representing the whole North American talc business of the Group are voluntarily seeking the protection of Chapter 11, a special legal process under U.S. law. This process allows these subsidiaries to safeguard their long-term business interests while working towards a permanent resolution of their historic talc-related liabilities. The Chapter 11 filing will not adversely affect the business operations, employees or customers of the Group, which will continue to operate as usual and honor all its obligations to stakeholders.
While taking this action, the Group continues to believe that the U.S. talc-related litigation is without merit, as the safety of talc has been confirmed by dozens of peer-reviewed studies and multiple regulatory and scientific bodies. The filing subsidiaries' decision was prompted by the actual and projected increase of defense and settlement costs over the next few years. Such increase follows heightened media coverage of U.S. cosmetic talc-related lawsuits and the growing reluctance by the filing entities' insurers and third-party contractual indemnitors to provide coverage against these increases without new and lengthy litigation by the filing subsidiaries to secure their rights.
The process initiated by the filing subsidiaries immediately suspends all outstanding U.S. talc litigation against the filing entities and avoids the overwhelming projected defense costs associated with the specific nature of the U.S judicial system's handling of product liability claims. This process will enable the filing subsidiaries to resolve current and future claims related to past sales of talc in the U.S. through a plan of reorganization to be negotiated with representatives of existing and future claimants in the coming months.
Although significant, the impact of today's decision of the North American talc subsidiaries and the anticipated terms of their plan of reorganization is not expected to materially affect Imerys's overall financial situation, profitability, and cash generative business profile. For the year ended December 31, 2018, these subsidiaries, which will as from today no longer be included within the scope of consolidation of the Group, recorded €143 million in revenue, €25 million in EBITDA and €16 million in current operating income, which represented approximately 3% of the same Group's consolidated figures. The estimated net financial impact of the overall process initiated today amounts to €250 million has been provisioned in the Group's full-year 2018 consolidated financial statements, in addition to €17 million of costs incurred during the year.
The North American talc filing subsidiaries' announcement is available at: www.ITArestructuring.com.
At its meeting on February 13, 2019, Imerys' Board of Directors agreed the draft resolutions that will be submitted for approval by the Shareholders' General Meeting on May 10, 2019. They include in particular the re-appointment Odile Desforges, Lucile Ribot and Ian Gallienne as directors for a three-year period, as their terms of office are due to expire.
At the Shareholders' General Meeting of May 10, 2019, the Board of Directors will propose a dividend of €2.150 per share, up 3.6% compared with the dividend paid in 2018, representing a total estimated payout of €171 million equal to 48% of net income from current operations, Group's share. This proposal reflects the Board's confidence in the Group's fundamentals and development prospects. The dividend is expected to be paid out from May 22, 2019.
Imerys is entering 2019 with:
In a context that has remained challenging since the beginning of 2019 and a high basis of comparison, the Group will continue to sustain its performance by giving priority to cost reduction and cash flow generation.
| Unaudited quarterly data (€ millions) |
2017 Revenue |
2018 Revenue |
Change | Organic growth7 |
Volumes | Price-mix |
|---|---|---|---|---|---|---|
| First quarter | 1,034.1 | 1,129.6 | + 9.2% | + 4.7% | + 1.5% | + 3.2% |
| Second quarter | 1,030.5 | 1,180.9 | + 14.6% | + 6.0% | + 1.7% | + 4.3% |
| Third quarter | 1,102.7 | 1,153.9 | + 4.6% | + 3.1% | - 0.9% | + 4.0% |
| Fourth quarter | 1,131.5 | 1,125.6 | -0.5% | + 0.3% | - 2.9% | + 3.3% |
| Year | 4,299.0 | 4,590.0 | + 6.8% | + 3.4% | - 0.2% | + 3.7% |
Revenue in 2018 totalled €4,590.0 million, up + 6.8% compared with 2017. This increase reflects organic growth of 3.4%, driven in particular by a positive price-mix effect in all business groups (3.7%), in a context of rising inflation of input costs. In addition to a high basis of comparison, volumes were impacted by a slowdown in industrial markets (abrasives, foundry, paints & coatings, and plastics) in the second half of the year, particularly in the fourth quarter.
Revenue was also boosted by a positive perimeter effect of €290.4 million (6.8%), which included in particular €250.0 million from Kerneos (acquired in July 2017), as well as significantly negative exchange rate effect representing €147.1 million euros (3.4%).
| Unaudited quarterly data (€ millions) | 2017 | 2018 | Change |
|---|---|---|---|
| First quarter | 122.8 | 129.6 | + 5.6% |
| Operating margin | 11.9% | 11.5% | - 0.4 point |
| Second quarter | 140.7 | 154.2 | + 9.6% |
| Operating margin | 13.6% | 13.1% | - 0.5 point |
| Third quarter | 145.4 | 140.9 | -3.1% |
| Operating margin | 13.2% | 12.2% | -1.0 point |
| Fourth quarter | 142.4 | 137.5 | -3.4% |
| Operating margin | 12.6% | 12.2% | -0.4 point |
| Year | 551.2 | 562.1 | + 2.0% |
| Operating margin | 12.8% | 12.2% | -0.6 point |
7 Organic growth: growth at comparable perimeter and exchange rates, or "like-for-like"
Current operating income totaled €562.1 million in 2018, up 2.0% compared with 2017 at 12.2% operating margin. This performance benefitted from a positive price-mix effect of €146.4 million, largely offsetting the increase in variable costs (€111.8 million, due mainly to raw materials and energy).
The contribution of recent acquisitions rose to €32.5 million, driven by Kerneos in particular, more than compensating the negative impact of lower sales volumes (€5.4 million) and unfavorable exchange rates (€21.9 million), particularly in the first half of the year.
The €45 million increase in fixed costs and overheads over the full year (up 2.7%) was contained in the fourth quarter (down 0.5%) as a result of the decisions made to withdraw from the ceramic proppants business and mothball the natural graphite operations in Namibia.
Net income from current operations, Group share increased 6.5% to €356.8 million (€334.9 million in 2017).
It includes an improvement in financial result from - €78.4 million in 2017 to - €60.2 million in 2018, thanks to Imerys' optimization of financial costs (1.8% average interest rate) and asset liability management. The current income tax expense of €145.2 million (€136.9 million in 2017) corresponds to an effective tax rate of 28.9%, which remained stable compared with 2017.
Net income from current operations, Group share, per share grew up 6.2% to €4.50.
Net income, Group share, increased + 52.0% to reach €559.6 million in 2018 (€368.2 million in 2017). It takes into account:
| (in € millions) | 2017 | 2018 |
|---|---|---|
| Current EBITDA | 777.0 | 793.2 |
| Change in operating working capital requirement (WCR) | (13.1) | (25.3) |
| Paid capital expenditure | (319.4) | (333.0) |
| Other | 8.9 | 13.5 |
| Current free operating cash flow | 453.4 | 448.4 |
| Notional tax | (159.6) | (162.6) |
| Net current free operating cash flow | 293.8 | 285.8 |
| Financial expense (net of tax) | (57.0) | (31.8) |
| Other working capital requirement | 35.5 | 38.8 |
| Net current free cash flow | 272.3 | 292.8 |
Imerys generated a solid level of current free operating cash flow which amounted to €448.4 million before tax, representing a cash conversion of 57% of Group current EBITDA). Net current free operating cash flow totaled €285.8 million in 2018, mainly as a results of the following items:
| (€ millions) | 2017 | 2018 |
|---|---|---|
| Net debt at December 31 | 2,246.4 | 1,297.4 |
| Average net debt for the year | 1,873.2 | 2,102.0 |
| Shareholders' equity | 2,878.2 | 3,253.5 |
| Current EBITDA | 777.0 | 793.2 |
| Net debt / shareholders' equity | 78.1% | 39.9% |
| Net debt / current EBITDA* | 2.5 x | 1.6x |
* published current EBITDA
Net financial debt amounted to €1,297.4 million as of December 31, 2018, representing a €949.0 million decrease compared with December 31, 2017. As a result, the ratio between net financial debt and current EBITDA fell to 1.6x at December 31, 2018 (from 2.5x at December 31, 2017). This is mainly due to the disposal of the Roofing division, which generated cash flow of €823 million. It also takes into account a solid cash flow generation for the year and €167.8 million paid in dividend.
The Group's robust financial structure is rated Baa2 by Moody's and BBB by Standard & Poor's, with a stable outlook for both rating agencies.
At December 31, 2018, Imerys' bond financing amounted to €1,982 million with an average maturity of 6.5 years. The Group also had €1,330 million in bilateral credit lines. As a result, the Group's financial resources totaled €3,312 million with an average maturity of 5,0 years.
(28% of consolidated revenue in 2018)
| Unaudited quarterly data (€ millions) | 2017 | 2018 | Change | Organic |
|---|---|---|---|---|
| First quarter revenue | 321.6 | 319.7 | - 0.6% | + 4.9% |
| Second quarter revenue | 332.0 | 327.9 | - 12% | + 2.6% |
| Third quarter revenue | 338,7 | 327.7 | -3.2% | -1.2% |
| Fourth quarter revenue | 334.3 | 319.7 | - 4.4% | - 4.1% |
| Annual revenue | 1,326.6 | 1,295.0 | -2.4% | + 0.5 % |
| Current operating income | 141.1 | 123.2 | -12.7% | + 1.5 % |
| Operating margin | 10.6 % | 9.5 % | - 1.1 point | - |
Revenue generated by the Energy Solutions & Specialties business group totaled €1,295.0 million in 2018, down 2.4% on published data. This change includes a significant €49.1 million negative exchange rate effect (3.7%) and a net positive perimeter effect of €11.0 million (0.8%). This takes into account external growth operations completed in the Carbonates division (acquisition of Micronita in Brazil, in November 2017 and Vimal Microns in India, in February 2018, as well as disposal in August 2018 of a lime and limestone production business in Brazil, which generated €9 million of revenue in 2017) and in the Monolithic Refractories division (acquisition of Set Linings at end March 2017).
On a like-for-like basis, annual revenue of the business group was flat due to the softness seen in the industrial markets like foundry, petrochemicals, boilers and incinerators, which weighted on the Monolithic Refractories division in the fourth quarter. In China, the Group faced a slowdown in the lithium-ion battery market affecting its Graphite & Carbon division. The Carbonates division continued its development in a context of falling demand in the US construction market. In the fourth quarter, revenue decreased -4.1% on a like-for-like basis compared with the prior year.
Current operating income for the business group came to €123.2 million in 2018, resulting in an operating margin of 9.5%, partly due to the unfavorable exchange rate effect. However, the decision to withdraw from the ceramic proppants business (Oilfield Services division) and mothball underperforming natural graphite operations in Namibia, helped to improve the operating margin in the second half of 2018 to 10.2% compared with 8.8% in the first half.
(28% of consolidated revenue in 2018)
| Unaudited quarterly data (€ millions) | 2017 | 2018 | Change | Organic |
|---|---|---|---|---|
| First quarter revenue | 312.4 | 322.6 | + 3.3% | + 5.8% |
| Second quarter revenue | 317.0 | 333.9 | + 5.3% | + 5.3% |
| Third quarter revenue | 302.2 | 325.2 | + 7.6% | + 3.7% |
| Fourth quarter revenue | 305.5 | 316.5 | + 3.6 % | +0.4% |
| Annual revenue | 1,237.0 | 1,298.1 | + 4.9 % | + 3.8 % |
| Current operating income | 254.2 | 240.1 | -5.6% | + 1.7 % |
| Operating margin | 20.6 % | 18.5 % | -2.1 points | - |
Revenue for the Filtration & Performance Additives business group totaled €1,298.1 million in 2018, representing a year-on-year increase of 4.9%. It includes a €53.2 million positive perimeter effect (4.3%) in particular as a result of the acquisition of Regain Polymers (September 2017) and a €39.3 million negative exchange rate effect (3.2%).
On a like-for-like basis. the business group's annual revenue grew 3.8% in 2018, supported by sustained demand in its markets, despite a slowdown in the second half of the year. The Metallurgy division benefitted from still supportive iron & steel markets meanwhile foundry demand in Europe was a bit slower. The Filtration division has continued its expansion into new segments like cosmetics and agriculture, in a context of high basis of comparison. The Performance Additives division continued to face a lack of visibility in the automotive market in Europe and in North America, and limited demand in the paints & coatings markets in Europe, and one of its plants is temporarily suspending deliveries for production issues . 8
The business group's current operating income totaled €240.1 million, leading to an operating margin of 18.5% (from 20.6% in 2017), due to a less favorable business mix in the second half.
8 Wollastonite plant in Willsboro, United States, with a total yearly revenue of €40 million, and serving mainly industrial applications such as paint and plastics.
(18% of consolidated revenue in 2018)
| Unaudited quarterly data (€ millions) | 2017 | 2018 | Change | Organic |
|---|---|---|---|---|
| First quarter revenue | 231.7 | 208.7 | - 9.9% | - 0.7% |
| Second quarter revenue | 224.4 | 214.6 | - 4.4% | + 3.7% |
| Third quarter revenue | 215.4 | 214.5 | - 0.4% | + 3.4% |
| Fourth quarter revenue | 211.9 | 216.3 | + 2.1% | + 4.0% |
| Annual revenue | 883.4 | 854.1 | - 3.3% | + 2.6% |
| Current operating income | 115.8 | 102.9 | -11.2% | - 2.6% |
| Operating margin | 13.1 % | 12.0 % | - 1.1 point | - |
Revenue for the Ceramic Materials business group totaled €854.1 million in 2018. The 3.3% year-on-year drop factors in a significant €42.8 million negative exchange rate effect (4.8%), in particular due to the Brazilian real.
On a like-for-like basis. annual revenue was up + 2.6% in 2018, with a good momentum in the fourth quarter. The Ceramics division maintained a positive trend, supported by strong construction markets in emerging countries.
The business group's current operating income totaled €102.9 million in 2018, resulting in an operating margin of 12.0%, due to the impact of weak paper markets in the Kaolin division.
(26% of consolidated revenue in 2018)
| Unaudited quarterly data (€ millions) | 2017 | 2018 | Change | Organic |
|---|---|---|---|---|
| First quarter revenue | 184.2 | 304.2 | + 65.1% | + 10.3% |
| Second quarter revenue | 171.5 | 329.8 | + 92.3% | + 22.6% |
| Third quarter revenue | 263.1 | 309.4 | + 17.6% | + 12.3% |
| Fourth quarter revenue | 296.2 | 293.7 | -0.8% | + 0.6% |
| Annual revenue | 915.0 | 1 237.0 | + 35.2 % | + 10.1 % |
| Current operating income | 111.5 | 152.5 | + 36.8 % | + 9.9 % |
| Operating margin | 12.2 % | 12.3 % | + 0.1 point | - |
Revenue for the High Resistance Minerals business group totaled €1,237.0 million in 2018. The 35.2% year-on-year reported increase in revenue factors in a significant €254.8 million positive perimeter effect (27.9%) relating to the integration of Kerneos, and to a lesser extent to Zhejiang in China in the Fused Minerals division. The negative exchange rate impact was substantial at €24.9 million (2.7%).
On a like-for-like basis, annual revenue increased 10.1% in 2018, boosted by a significant price mix to offset a strong increase in raw materials. In the fourth quarter, the Fused Minerals division faced a slowdown in industrial markets and a particularly high basis of comparison. In the Aluminates division, which includes Kerneos, the positive momentum in North America and Asia was slightly mitigated in Europe (Germany in particular).
The business group's current operating income rose 36.8% (9.9% like-for-like) to €152.5 million in 2018, as a result of the synergies from the integration of Kerneos and a firm price-mix effect offsetting a high inflation in raw materials.
| February 13, 2019 (post market) | Full Year 2018 Results |
|---|---|
| May 6, 2019 (post market) | Q1 2019 Results |
| May 10, 2019 | Shareholders' General Meeting |
| June 13, 2019 | Capital Market Day |
| July 29, 2019 (post market) | H1 2019 Results |
| October 29, 2019 (post market) | Q3 2019 Results |
The above dates are tentative and may be updated on the Group's website at www.imerys.com. in the Investors & Analysts/Financial Agenda section.
The press release is available from the Group's website www.imerys.com in the News section on the home page.
The presentation of the 2018 results will begin at 11am (GMT+1) on February 14 and will be streamed live on the Group's website.
The world's leading supplier of mineral-based specialty solutions for industry. with €4.6 billion in revenue and 18,000 employees in 2018. Imerys delivers high value-added, functional solutions to a great number of sectors, from processing industries to consumer goods. The Group draws on its understanding of applications, technological knowledge and expertise in material science to deliver solutions based on beneficiation of its mineral resources, synthetic minerals and formulations. These contribute essential properties to customers' products and their performance, including heat resistance, hardness, conductivity, opacity, durability, purity, lightness, filtration, absorption and water repellency. Imerys is determined to develop responsibly, in particular by fostering the emergence of environmentally-friendly products and processes.
More comprehensive information about Imerys may be obtained from its website (www.imerys.com) in the Regulated Information section, particularly in its Registration Document filed with the French financial markets authority (Autorité des marchés financiers, AMF) on March 20, 2018 under number D.18-0150 (also available from the AMF website. www.amf-france.org). Imerys draws investors' attention to Chapter 4. "Risk Factors and Internal Control" of its Registration Document.
Disclaimer: This document contains projections and other forward-looking statements. Investors should be aware 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.
The present document is a translation of the French language version provided solely for the convenience of English-speaking users. In all matters of interpretation, views or opinions expressed in the original language version of the document in French take precedence over the translation. Only the French language version is binding.
| Analysts/Investor Relations: | Press Contacts: |
|---|---|
| Vincent Gouley - + 33 (0)1 4955 6469 | Claire Garnier - + 33 (0)1 4955 6427 |
| [email protected] | Philémon Tassel - + 33 (0)6 3010 9611 |
| Q1 2017 | Q2 2017 | Q3 2017 | Q4 2017 | Q1 2018 | Q2 2018 | Q3 2018 | Q4 2018 | |
|---|---|---|---|---|---|---|---|---|
| Revenue by business group (€ millions) | ||||||||
| Energy Solutions & Specialties | 321.6 | 332.0 | 338.7 | 334.3 | 319.7 | 327.9 | 327.7 | 319.7 |
| Filtration & Performance | ||||||||
| Additives | 312.4 | 317.0 | 302.2 | 305.5 | 322.6 | 333.9 | 325.2 | 316.5 |
| Ceramic Materials | 231.7 | 224.4 | 215.4 | 211.9 | 208.7 | 214.6 | 214.5 | 216.3 |
| High Resistance Minerals | 184.2 | 171.5 | 263.1 | 296.2 | 304.2 | 329.8 | 309.4 | 293.7 |
| Holding & Eliminations | (15.8) | (14.4) | (16.7) | (16.4) | (25.6) | (25.3) | (22.9) | (20.6) |
| Group | 1,034.1 | 1,030.5 | 1,102.7 | 1,131.5 | 1,129.6 | 1,180.9 | 1,153.9 | 1,125.6 |
| Like-for-like revenue proforma growth | ||||||||
| Energy Solutions & Specialties | + 1.0% | + 0.7% | + 5.3% | + 9.0% | + 4.9% | + 2.6% | - 1.2% | - 4.1% |
| Filtration & Performance | ||||||||
| Additives | + 6.5% | + 4.0% | + 4.8% | + 6.1% | + 5.8% | + 5.3% | + 3.7% | + 0.4% |
| Ceramic Materials | - 4.5% | - 3.6% | - 1.2% | - 1.2% | - 0.7% | + 3.7% | + 3.4% | + 4.0% |
| High Resistance Minerals | + 14.6% | + 4.4% | + 10.7% | + 13.2% | + 10.3% | + 22.6% | + 12.3% | + 0.6% |
| Group | + 3.1% | + 1.4% | + 4.2% | + 6.3% | + 4.7% | + 6.0% | + 3.1% | + 0.3% |
| Current operating income (€ millions) | ||||||||
| Group | 122.8 | 140.7 | 145.4 | 142.4 | 129.6 | 154.2 | 140.9 | 137.5 |
| Operating margin | 11.9% | 13.6% | 13.2% | 12.6% | 11.5% | 13.1% | 12.2% | 12.2% |
| Revenue by geographical area (€m) |
2018 Revenue | Change (current basis) 2018 vs. 2017 |
% of 2018 revenue | % of 2017 revenue |
|---|---|---|---|---|
| Western Europe | 1,807.8 | + 7.7 % | 40% | 39 % |
| of which France | 250.7 | +10.7% | 5% | 5% |
| United States/ Canada | 1,118.5 | + 0.4 % | 24% | 26 % |
| Emerging countries | 1,432.9 | + 11.2 % | 31% | 30 % |
| Japan/ Australia | 230.8 | + 6.4 % | 5 % | 5 % |
| (€ millions) | 2017 | 2018 | change |
|---|---|---|---|
| Revenue | 4 299.0 | 4 590.0 | +6.8% |
| Current EBITDA | 777.0 | 793.2 | +2.1% |
| Current operating income | 551.2 | 562.1 | +2.0% |
| Financial income | (78.4) | (60.2) | -23.2% |
| Current tax | (136.9) | (145.2) | + 6.1% |
| Minorities | (0.9) | 0.1 | N/A |
| Net income from current operations. | |||
| Group share | 335.1 | 356.8 | +6.5% |
| Other operating income and charges, | |||
| net | (34.2) | (585.2) | N/A |
| Net income from discontinued | |||
| activities | 67.3 | 788.0 | N/A |
| Net income, Group share | 368.2 | 559.6 | +52.0% |
| (€ millions) | Q4 2017 | Q4 2018 | change |
|---|---|---|---|
| Revenue | 1,131.5 | 1,125.6 | -0.5% |
| Current EBITDA | 194.0 | 192.5 | -0.8% |
| Current operating income | 142.4 | 137.5 | -3.4% |
| Financial income | (15.9) | (11.0) | -30.7% |
| Current tax | (34.8) | (34.0) | -2.1% |
| Minorities | (0.4) | (1.6) | N/A |
| Net income from current operations, | |||
| Group share | 91.3 | 90.9 | -0.2% |
| Other operating income and charges, | |||
| net | (8.8) | (560.4) | N/A |
| Net income from discontinued | |||
| activities | 17.9 | 739.0 | N/A |
| Net income, Group share | 100.4 | 269.5 | N/A |
The term "on a comparable basis" means: "at comparable Group structure and exchange rates";
Restatement of the foreign exchange effect consists of calculating aggregates for the current year at the exchange rate of the previous year. The impact of exchange rate instruments qualifying as hedging instruments is taken into account in current data.
the term "Net income from current operations" means the Group's share of income before other operating revenue and expenses, net;
the term "Net current free operating cash flow" means EBITDA after deduction of notional tax, changes in working capital requirement and paid capital expenditure and including subsidies, value of divested assets and miscellaneous (see change in net financial debt as an appendix to this press release);
| 2018 | 2017 | |||
|---|---|---|---|---|
| Discontinued | Discontinued | |||
| (€ millions) | operations(1) | operations(1) | ||
| Revenue | 4,590.0 | 229.2 | 4,299.0 | 299.4 |
| Current income and expenses | (4,027.9) | (153.1) | (3,747.7) | (202.6) |
| Raw materials and consumables used | (1,503.2) | (61.0) | (1,351.2) | (78.6) |
| External expenses | (1,267.8) | (39.7) | (1,205.1) | (46.5) |
| Staff expenses | (997.7) | (43.0) | (930.5) | (56.9) |
| Taxes and duties | (41.2) | (3.9) | (46.2) | (4.8) |
| Amortization, depreciation and impairment | (265.9) | (5.4) | (251.8) | (13.8) |
| Other current income and expenses | 47.9 | (0.1) | 37.2 | (2.0) |
| Current operating income | 562.1 | 76.1 | 551.2 | 96.9 |
| Other operating income and expenses | (651.5) | 738.8 | (52.2) | (1.4) |
| Gain (loss) from obtaining or losing control | 3.9 | 739.7 | (11.0) | - |
| Other non-recurring items | (655.4) | (0.9) | (41.2) | (1.4) |
| Operating income | (89.4) | 814.9 | 499.1 | 95.5 |
| Net financial debt expense | (42.0) | 0.0 | (46.4) | (0.0) |
| Income from securities | 4.9 | - | 10.2 | - |
| Gross financial debt expense | (46.9) | - | (56.6) | - |
| Other financial income and expenses | (18.2) | (0.4) | (31.9) | (0.8) |
| Other financial income | 285.4 | 0.1 | 212.1 | - |
| Other financial expenses | (303.6) | (0.5) | (244.0) | (0.8) |
| Financial income (loss) | (60.2) | (0.4) | (78.4) | (0.9) |
| Income tax | (89.0) | (26.5) | (118.9) | (27.3) |
| (1) Net income from discontinued operations |
788.0 | 788.0 | 67.3 | 67.3 |
| Net income | 549.4 | - | 369.1 | - |
| (2) Net income, Group share |
559.6 | - | 368.2 | - |
| Net income attributable to non-controlling interests | (10.2) | - | 0.9 | - |
| (1) Roofing division | , | , | , | |
| (2) Net income per share | ||||
| Basic net income per share (in €) 15 |
7.06 | 9.94 | 4.66 | 0.85 |
| Diluted net income per share (in €) 15 |
6.96 | 9.80 | 4.59 | 0.84 |
| (€ millions) | 2018 | 2017 |
|---|---|---|
| Non-current assets | 4,908.3 | 5,251.5 |
| Goodwill | 2,143.3 | 2,135.5 |
| Intangible assets | 277.6 | 305.5 |
| Mining assets | 503.7 | 592.6 |
| Property, plant and equipment | 1,662.1 | 1,896.0 |
| Joint ventures and associates | 112.8 | 115.5 |
| Other financial assets | 42.0 | 52.1 |
| Other receivables | 35.1 | 46.3 |
| Derivative financial assets | 19.3 | 22.5 |
| Deferred tax assets | 112.4 | 85.5 |
| Current assets | 2,685.6 | 2,216.5 |
| Inventories | 867.0 | 840.2 |
| Trade receivables | 656.6 | 676.1 |
| Other receivables | 296.9 | 302.4 |
| Derivative financial assets | 7.3 | 7.0 |
| (1) Other financial assets |
8.9 | 8.8 |
| (1) Cash and cash equivalents |
848.9 | 381.9 |
| Consolidated assets | 7,593.9 | 7,468.0 |
| Equity, Group share | , 3,217.2 |
2,827.6 |
| Capital | 159.0 | 159.2 |
| Premiums | 520.4 | 529.1 |
| Reserves | 1,978.2 | 1,771.0 |
| Net income, Group share | 559.6 | 368.3 |
| Equity attributable to non-controlling interests Equity |
36.4 3,253.6 |
50.6 2,878.2 |
| Non-current liabilities | 3,095.5 | 2,859.8 |
| Provisions for employee benefits | 290.0 | 321.3 |
| Other provisions | 666.8 | 394.6 |
| Borrowings and financial debt (1) |
1,995.9 | 1,986.3 |
| Other debts | 17.7 | 20.2 |
| Derivative financial liabilities | 0.4 | 2.7 |
| Deferred tax liabilities | 124.7 | 134.7 |
| Current liabilities | 1,244.8 | 1,729.9 |
| Other provisions | 23.7 | 27.1 |
| Trade payables | 557.3 | 510.9 |
| Income tax payable | 115.1 | 100.9 |
| Other debts | 358.9 | 417.2 |
| Derivative financial liabilities | 9.7 | 6.0 |
| (1) Borrowings and financial debt |
168.5 | 664.9 |
| (1) Bank overdrafts |
11.6 | 2.9 |
| Consolidated equity and liabilities | 7,593.9 | 7,468.0 |
| (1) Included in the calculation of net financial debt | 1,297.4 | 2,246.4 |
| 2018 | 2017 | |||
|---|---|---|---|---|
| Discontinued | Discontinued | |||
| (€ millions) | operations(1) | operations(1) | ||
| Current operating income | 562.1 | 76.1 | 551.2 | 96.9 |
| (2) Operating amortization, depreciation and impairment |
265.9 | 5.4 | 251.8 | 13.8 |
| Net change in operating provisions | (38.6) | (0.4) | (25.9) | 2.0 |
| Share in net income of joint ventures and associates | (1.7) | - | (6.0) | - |
| Dividends received from joint ventures and associates | 5.6 | - | 5.8 | - |
| Operating cash flow before taxes (current EBITDA) | 793.3 | 81.1 | 777.0 | 112.7 |
| (3) Notional tax on current operating income |
(162.6) | (26.6) | (159.6) | (28.0) |
| Current net operating cash flow | 630.7 | 54.5 | 617.4 | 84.7 |
| Capital expenditure (4) & (5) |
(333.0) | (9.9) | (319.4) | (21.4) |
| Intangible assets | (28.4) | (0.3) | (21.6) | (1.2) |
| Property, plant and equipment | (251.6) | (5.9) | (258.2) | (18.1) |
| (6) Overburden mining assets |
(55.9) | - | (58.0) | - |
| Debt on acquisitions | 2.9 | (3.7) | 18.4 | (2.2) |
| Carrying amount of current asset disposals | 13.5 | 0.8 | 8.9 | - |
| Change in operational working capital requirement | (25.4) | (0.1) | (13.1) | 1.4 |
| Inventories | (99.9) | 0.4 | (47.0) | (5.9) |
| Accounts receivable, advances and down payments received | 15.1 | (0.1) | (24.5) | 5.5 |
| Accounts payable, advances and down payments paid | 59.4 | (0.4) | 58.4 | 1.7 |
| Current free operating cash flow | 285.8 | 45.3 | 293.8 | 64.7 |
| (1) Roofing division | ||||
| (2) Operating amortization, depreciation and impairment | 265.9 | 5.4 | 251.8 | 13.8 |
| Net operating amortization and depreciation (Appendix 1 of the Consolidated Statement of Cash Flows) |
265.4 | - | 251.7 | - |
| Finance lease depreciation (Appendix 3 of the Consolidated Statement of Cash Flows) | (0.6) | - | (0.1) | - |
| (3) Effective tax rate on current operating income | 28.9 % | - | 28.9 % | - |
| (4) Capital expenditure | (333.0) | (9.9) | (319.4) | (21.4) |
| Acquisitions of intangible assets and property, plant and equipment (Consolidated Statement of Cash Flows) |
(332.9) | - | (319.3) | - |
| Finance lease acquisitions (Appendix 3 of the Consolidated Statement of Cash Flows) | - | - | 0.2 | - |
| (5) Recognized capital expenditure/asset depreciation ratio | 126.3 % | - | 134.1 % | - |
| The recognized capital expenditure/asset depreciation ratio is equal to capital | ||||
| expenditure (except for | ||||
| debt on acquisitions) divided by the increase in amortization and depreciation Increase in amortization and depreciation |
265.9 | - | 251.8 | - |
| (6) Overburden mining assets | (55.7) | - | (48.9) | - |
| Overburden mining assets – capital expenditure | (55.9) | - | (48.9) | - |
| Neutralization of activated restoration provisions | 0.2 | - | - | - |
| 2018 | 2017 | |||
|---|---|---|---|---|
| Discontinued | Discontinued | |||
| (€ millions) | operations(1) | operations(1) | ||
| Current free operating cash flow | 285.8 | 45.3 | 293.8 | 64.7 |
| Financial income (loss) | (60.2) | (0.5) | (78.4) | (0.9) |
| Financial impairment loss and unwinding of the discount | 10.9 | 0.2 | (1.3) | 0.2 |
| Income tax on financial income (loss) | 17.4 | 0.2 | 22.7 | 0.2 |
| Change in income tax debt | 16.5 | 1.7 | 2.0 | 3.0 |
| Change in deferred taxes on current operating income | 17.3 | 0.6 | 34.0 | (7.2) |
| Change in other items of working capital | (9.2) | 6.0 | (14.5) | (6.7) |
| Share-based payment expenses | 14.9 | 0.4 | 12.9 | 0.5 |
| Change in the fair value of operational hedge instruments | (0.7) | - | 2.1 | - |
| Change in dividends receivable from available-for-sale financial assets | 0.1 | - | (0.8) | - |
| Current free cash flow | 292.8 | 53.9 | 272.3 | 53.8 |
| Acquisitions | (23.2) | 0.0 | (1,056.9) | (3.2) |
| Acquisitions of shares in consolidated entities minus net debt acquired | (22.9) | - | (1,053.7) | (3.2) |
| Acquisitions of shares in consolidated entities from non-controlling interests | - | - | (0.2) | - |
| Acquisitions of available-for-sale financial assets | (0.3) | - | (3.0) | - |
| Disposals | 51.9 | 851.4 | 10.2 | 0.0 |
| Disposals of investments in consolidated entities minus net debt disposed | 42.2 | 851.4 | 4.8 | - |
| Non-recurring disposals of intangible assets and property plant and equipment | 9.7 | - | 5.4 | - |
| Transaction costs | (5.4) | (16.7) | (19.3) | - |
| Changes in the estimated contingent consideration of the seller | (0.8) | - | 9.5 | - |
| Cash flow from other operating income and expenses | (46.6) | (3.3) | (11.3) | (2.3) |
| Dividends paid to shareholders and non-controlling interests | (104.9) | (62.9) | 86.5 | (236.1) |
| Financing requirement | 163.8 | 822.4 | (709.0) | (187.7) |
| Transactions on equity | 2.5 | - | (0.5) | - |
| Net change in financial assets | (7.1) | 0.1 | (4.2) | - |
| Cash flow of assets held for sale | 822.5 | 822.5 | (187.7) | (187.7) |
| Change in net financial debt | 981.7 | - | (901.3) | - |
(1) Roofing division
| (€ millions) | 2018 | 2017 |
|---|---|---|
| Current operating income | 562.1 | 551.2 |
| Financial income (loss) | (60.2) | (78.4) |
| Income tax on current operating income and financial income (loss) | (145.2) | (136.9) |
| Share of non-controlling interests in current operating income and financial income (loss) | 0.1 | (0.9) |
| Net income from current operations, Group share | 356.8 | 335.1 |
| Other operating income and expenses – gross | (651.5) | (52.2) |
| Income tax on other operating income and expenses | 56.2 | 18.0 |
| Share of non-controlling interests in other operating income and expenses | 10.1 | - |
| Net income from discontinued operations (1) |
788.0 | 67.3 |
| Net income, Group share | 559.6 | 368.2 |
(1) Roofing division
| (€ millions) | 2018 | 2017 |
|---|---|---|
| Cash flow from operating activities | 615.7 | 621.5 |
| Of which cash flow from discontinued operations (1) |
59.7 | 73.0 |
| Cash flow from current operations | 847.2 | 836.1 |
| Interest paid | (46.1) | (76.8) |
| Income tax on current operating income (expense) and financial income (loss) | (135.7) | (132.9) |
| Dividends received from available-for-sale financial assets | 0.1 | (0.8) |
| Cash flow from other operating income and expenses | (49.8) | (4.1) |
| Cash flow from investing activities | 378.4 | (639.6) |
| Of which cash flow from discontinued operations (1) |
676.1 | (20.4) |
| Acquisitions of intangible assets and property, plant and equipment | (342.8) | (340.7) |
| Acquisitions of shares in consolidated entities, net of acquired cash | (23.7) | (311.9) |
| Transaction costs | (22.1) | (19.3) |
| Changes in the estimated contingent consideration of the seller | (0.8) | 0.0 |
| Acquisitions of available-for-sale financial assets | (0.1) | (3.2) |
| Disposals of intangible assets and property, plant and equipment | 26.8 | 19.7 |
| Disposals of shares in consolidated entities, net of disposed cash | 743.2 | 5.1 |
| Net change in financial assets | (7.2) | 0.1 |
| Interest income | 5.1 | 10.6 |
| Cash flow from financing activities | (529.2) | (380.1) |
| (1) Of which cash flow from discontinued operations |
(29.9) | (51.9) |
| Capital increase and decrease in cash | (6.9) | 2.1 |
| Disposals (acquisitions) of treasury shares | 9.4 | (2.6) |
| Dividends paid to shareholders | (164.6) | (148.2) |
| Dividends paid to non-controlling interests | (3.2) | (1.4) |
| Acquisitions of shares in consolidated entities from non-controlling interests | - | (0.2) |
| Loans issued | 5.6 | 604.2 |
| Repayment of borrowings | (32.7) | (1 136.9) |
| Net change in other debts | (336.8) | 302.9 |
| Change in cash and cash equivalents | 464.9 | (398.2) |
(1) Roofing division
| (€ millions) | 2018 | 2017 |
|---|---|---|
| Cash and cash equivalents at January 1 | 379.0 | 798.1 |
| Change in cash and cash equivalents | 464.9 | (398.1) |
| Impact of currency fluctuations | (6.6) | (21.0) |
| (2) Cash and cash equivalents at December 31 |
837.3 | 379.0 |
| Cash | 509.1 | 289.7 |
| Cash equivalents | 339.8 | 92.2 |
| Bank overdrafts | (11.6) | (2.9) |
(2) At December 31, 2018, "Cash and cash equivalents at December 31" included a restricted balance of €7.1 million (€1.9 million at December 31, 2017) not available for Imerys SA and its subsidiaries, of which €5.6 million (€1.3 million at December 31, 2017) due to legal restrictions or foreign exchange controls and €1.5 million (€0.6 million at December 31, 2017) due to statutory requirements.
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