Avio

Earnings Release • Sep 13, 2018

Informazione Regolamentata n. 1771-31-2018		Data/Ora Ricezione 13 Settembre 2018 18:02:54	MTA - Star
Societa'	:	Avio Spa
Identificativo Informazione Regolamentata	:	108427
Nome utilizzatore	:	AVIONSS01 - Spaziani
Tipologia	:	1.2
Data/Ora Ricezione	:	13 Settembre 2018 18:02:54
Data/Ora Inizio Diffusione presunta	:	13 Settembre 2018 18:02:55
Oggetto	:	HY 2018 RESULTS
Testo del comunicato

Vedi allegato.

HALF YEAR 2018 RESULTS

AVIO: REVENUES, MARGINS AND BACKLOG GROWTH

• Revenues¹ : Euro 178.8 million (+20.3% on HY 2017)
• Reported EBITDA² : Euro 14.5 million (+29.5%)
• Reported EBIT² : Euro 7.7 million (+79.1%)
• Net Income² : Euro 6.2 million (Euro 1.7 million in HY 2017)
• Backlog of Euro 961.5 million (+34% on June 2017, +1% on December 2017)
• Distribution of dividends of Euro 10 million, equal to Euro 0.38 per share
• Net Financial Position: positive cash position of Euro 21.7 million (Euro 41.7 million at December 31, 2017)

Colleferro (Rome), September 13, 2018 – The Board of Directors of Avio S.p.A., an aerospace leader listed on the STAR segment of the Italian Stock Exchange, today reviewed and approved the HY 2018 results.

The Group reports HY 2018 revenues of Euro 178.8 million, up 20.3% on the same period of the previous year. The increase is primarily due to Vega launcher operations and the greater focus on development of the new P120C engine, shared by the next generation launchers Ariane 6 and Vega C.

Reported EBITDA of Euro 14.5 million² , up 29.5% on H1 2017, while reported EBIT of Euro 7.7 million² grew 79.1% on the previous year, in line with the Reported EBITDA performance.

The Net Financial Position at June 30 was a positive cash position of Euro 21.7 million (Euro 41.7 million at December 31, 2017), in line with normal cash flows operating cycle and taking into account the payment of dividends in May for Euro 10 million.

The Backlog also improved to Euro 961.5 million (+34% on June 2017 and +1% on December 2017), benefitting from new Ariane and Vega contracts for a total of approx. Euro 190 million.

"Our double-digit growth again continued in the first half of 2018, building on the Group's 2017 results - stated Giulio Ranzo, Chief Executive Officer of Avio".

"In the first half of the year - added Ranzo - we have continued to develop the new Vega C and Ariane

¹ Net of "pass-through" revenues.

² Includes the portion of the Research and Development tax credit matured in 2017, accruing to the first half of 2018, of Euro 1.2 million.

6 launchers (which will fly respectively in 2019-2020), while completing also the fire testing of the Zefiro 40 and P120C engines (respectively second stage of the Vega C and first common stage of the Vega C and Ariane 6). Meanwhile, we have signed further launch contracts with new international clients both for Vega-SSMS and for Vega C".

More specifically, the contract to launch Thailand's Earth Observation satellite (Theos 2) has been signed in the past few days, and the signing of the contract for a Satellite of the Korean Aerospace Research Institute is expected soon.

"Just a few weeks ago, Vega completed its twelfth consecutive successful flight. The world reliability record for space launchers is firmly ours – concluded Giulio Ranzo. The performances of the European Ariane and Vega launchers, the successful development of new technologies, the growing trust of new international customers, our expanding backlog – of almost Euro one billion – allow us to look to the future with great confidence".

The presentation summarizing the Half-Year results will be available in the Investor Relations section of www.avio.com to assist the call with financial analysts and investors scheduled for Friday, September 14 at 10.30 AM. The Half-Year Financial Report will be made available in Italian and in English in accordance with Law.

* * *

The Executive Officer for Financial Reporting, Alessandro Agosti, declares in accordance with paragraph 2, Article 154-bis of the Consolidated Finance Act that the accounting information in the present press release corresponds to the underlying accounting documents, records and entries.

* * *

Avio is a leading international group engaged in the construction and development of space launchers and solid and liquid propulsion systems for space travel. The experience and know-how built up over more than 50 years puts Avio at the cutting-edge of the space launcher sector, solid, liquid and cryogenic propulsion and tactical propulsion. Avio operates in Italy, France and France Guyana with 5 facilities, employing approx. 850 highly-qualified personnel, of which approx. 30% involved in research and development. Avio is a prime contractor for the Vega programme and a subcontractor for the Ariane programme, both financed by the European Space Agency ("ESA"), placing Italy among the limited number of countries capable of producing a complete spacecraft.

For further information

Investor Relations Contacts Investor.relations@avio.com Media Contacts - Avio Communications Department giuseppe.coccon@avio.com; francesco.delorenzo@avio.com Rossella.conte@avio.com

CONSOLIDATED BALANCE SHEET	June 30, 2018	December 31, 2017
(in Euro)
ASSETS
Non-current assets
Property, plant & equipment	70,669,054	71,852,360
Investment property	2,808,236	2,832,219
Goodwill	61,005,397	61,005,397
Intangible assets with definite life	118,372,902	117,577,280
Investments	5,034,420	6,346,612
Non-current financial assets	7,440,000	7,440,000
Deferred tax assets	75,527,895	76,546,723
Other non-current assets	66,241,000	65,521,105
Total non-current assets	407,098,905	409,121,695
Current assets
Inventories and advances to suppliers	117,038,090	125,789,247
Contract work-in-progress	205,076,884	111,236,680
Trade receivables	4,640,605	8,507,533
Cash and cash equivalents	73,509,159	107,033,059
Current tax receivables	67,839,236	72,230,694
Other current assets	12,601,757	8,663,659
Total current assets	480,705,730	433,460,873
Assets held-for-sale and Discontinued Operations	-	-
	-	-
TOTAL ASSETS	887,804,635	842,582,567

AVIO GROUP CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEET	June 30, 2018	December 31, 2017
(in Euro)
EQUITY
Share capital	90,964,212	90,964,212
Share premium reserve	144,255,918	163,897,217
Other reserves	14,487,640	(4,682,849)
Retained earnings	8,996,515	3,611,315
Group net profit for the period	5,947,648	18,360,625
Total Group Equity	264,651,933	272,150,519
Equity attributable to non-controlling interests	11,512,456	10,054,880
TOTAL SHAREHOLDERS' EQUITY	276,164,389	282,205,399
LIABILITIES
Non-current liabilities
Non-current financial liabilities	40,000,000	40,000,000
Employee benefit provisions	11,122,941	10,906,705
Provisions for risks and charges	7,640,281	7,788,960
Other non-current liabilities	122,995,905	116,269,657
Total non-current liabilities	181,759,127	174,965,322
Current liabilities
Current financial liabilities	11,749,221	25,259,221
Current portion of non-current financial payables	60,000	60,000
Provisions for risks and charges	6,904,448	8,550,872
Trade payables	111,904,255	89,441,365
Advances from clients for contract work-in-progress	276,173,989	242,518,981
Current income tax liabilities	2,040,444	1,981,723
Other current liabilities	21,048,762	17,599,685
Total current liabilities	429,881,119	385,411,847
TOTAL LIABILITIES	611,640,246	560,377,169
Liabilities available-for-sale and discontinued operations	-	-
	-	-
TOTAL LIABILITIES AND EQUITY	887,804,635	842,582,567

CONSOLIDATED INCOME STATEMENT	H1 2018	H1 2017 (1)
(in Euro)
Revenues	202,004,928	101,287,263
Change in inventory of finished products, in progress and semi-finished	4,286,641	3,042,871
Other operating income	1,452,047	1,238,298
Consumption of raw materials	(64,882,242)	(32,209,358)
Service costs	(96,064,636)	(49,875,647)
Personnel expenses	(32,651,367)	(16,643,677)
Amortisation & Depreciation	(6,841,259)	(3,329,720)
Write-down and write-backs		-
Other operating costs	(4,983,914)	(1,264,493)
Effect valuation of investments under equity method - operating income/(charges)	1,767,620	259,026
Costs capitalised for internal works	3,576,441	754,775
EBIT	7,664,259	3,259,337
Financial income	590,413	653,645
Financial charges	(824,925)	(2,143,712)
NET FINANCIAL INCOME/(CHARGES)	(234,512)	(1,490,067)
Effect valuation of investments under equity method - financial income/(charges)
Other investment income/(charges)
INVESTMENT INCOME/(CHARGES)	-	-
PROFIT BEFORE TAXES AND DISCONTINUED OPERATIONS	7,429,747	1,769,270
Income taxes	(1,222,549)	575,014
PROFIT FROM CONTINUING OPERATIONS	6,207,198	2,344,284
NET PROFIT/(LOSS) FROM DISCONTINUED OPERATIONS	-	-
NET PROFIT FOR THE PERIOD	6,207,198	2,344,284
-- of which: Owners of the parent Non-controlling interests	5,947,648 259,549	2,060,107 284,177

(1) In consideration of the business combination on March 31, 2017 with Space 2 S.p.A., the amounts of Space 2 S.p.A. operations in the halfyear including Avio Group operations for the second quarter 2017 are reported. For a detailed analysis, reference should be made to the Director's Report.

CONSOLIDATED CASH FLOW STATEMENT

(Euro thousands)

		H1 2018	H1 2017 (1)
OPERATING ACTIVITIES Net profit for the period Adjustments for:		6,207	2,344
- Income taxes - (Income)/charges from equity investments		1,223 (1,768)	(575) -
- Financial (Income)/Charges		235	1,490
- Amortisation & Depreciation		6,841	3,330
Dividends received from Europropulsion S.A.		3,080	2,460
Net change provisions for risks and charges Net change employee provisions		(1,795) 216	(8,855) (28)
Changes in:
- Inventories		8,751	3,893
- Contract work-in-progress & advances		(60,185)	(19,042)
- Trade receivables		3,867	1,642
- Trade payables - Other current & non-current assets		22,463 752	15,591 (9,476)
- Other current & non-current liabilities		8,901	(4,208)
Income taxes paid		(476)	(289)
Interest paid		(120)	(2,622)
Net liquidity generated/(employed) in operating activities	(A)	(1,807)	(14,346)
INVESTING ACTIVITIES
Investments in:
- Tangible assets and investment property		(1,635)	(4,905)
- Intangible assets with definite life		(4,795)	(733)
- Equity Investments
- Savings Bonds/Restricted Bank Deposits Disposal price of tangible, intangible & financial assets
Changes in consolidation scope
Avio Business combination
- Price paid			(84,871)
- Cash and cash equivalents of Avio Group acquired at March 31, 2017			111,140
Disposal price financial assets			152,978
Liquidity generated (employed) in investing activities	(B)	(6,430)	173,610
FINANCING ACTIVITIES Senior Term and Revolving Facilities Agreement Repayments			(63,360)
Centralised treasury effect with Europropulsion S.A. joint control company		(13,510)	(615)
Dividends paid by the parent Avio S.p.A.		(10,017)
Dividends paid by subsidiaries concerning minority shareholdings of the Avio Group Other changes to financial assets and liabilities		(1,760)	(1,920) (30,440)
Liquidity generated (employed) in financing activities	(C)	(25,287)	(96,335)
INCREASE/(DECREASE) IN NET CASH AND CASH EQUIVALENTS	(A)+(B)+(C)	(33,524)	62,930
NET CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		107,033	445
NET CASH AND CASH EQUIVALENTS AT END OF PERIOD		73,509	63,375

(1) In consideration of the business combination on March 31, 2017 with Space 2 S.p.A., the amounts of Space 2 S.p.A. operations in the halfyear including Avio Group operations for the second quarter 2017 are reported. For a detailed analysis, reference should be made to the Director's Report.