Interpump Group — Earnings Release 2020

Nov 10, 2020

Informazione Regolamentata n. 0159-91-2020		Data/Ora Ricezione 10 Novembre 2020 11:28:19	MTA - Star
Societa'	:	INTERPUMP GROUP
Identificativo Informazione Regolamentata	:	139001
Nome utilizzatore	:	INTERPUMPN03 - MIRABELLI
Tipologia	:	REGEM
Data/Ora Ricezione	:	10 Novembre 2020 11:28:19
Data/Ora Inizio Diffusione presunta	:	10 Novembre 2020 11:28:21
Oggetto	:	Consolidated results at 30/09/2020
Testo del comunicato

Vedi allegato.

PRESS RELEASE

INTERPUMP GROUP APPROVES THE CONSOLIDATED RESULTS AT 30 SEPTEMBER 2020: A QUARTER OF RECOVERY

Chairman Fulvio Montipò: "The third quarter registered a much-awaited improvement compared to the previous periods; in this quarter, Interpump improved the EBITDA margin, achieved a very good cash generation, and reduced net debt"

DATA FOR THE THIRD QUARTER OF 2020:

NET SALES: € 314.7 million (€ 322.9 mn in Q3 2019) EBITDA: € 76.0 million (€ 78.1 mn in Q3 2019)

EBITDA/SALES: 24.2% (24.2% in Q3 2019)

CONSOLIDATED NET PROFIT: € 39.5 million (€ 43.3 mn in Q3 2019)

DATA FOR THE FIRST NINE MONTHS OF 2020:

NET SALES: € 954.2 million (€ 1,026.1 mn in 9M 2019)

EBITDA: € 215.3 million (€ 240.3 mn in 9M 2019)

EBITDA/SALES: 22.6% (23.4% in 9M 2019)

CONSOLIDATED NET PROFIT: € 103.0 million (€135.5 mn in 9M 2019)

FREE CASH FLOW: € 148.6 million (€ 76.0 million in 9M 2019)

NET DEBT: € 310.7 million (€ 370.8 million at 31/12/2019)

(after € 28.2 mn dividends paid, € 48.4 mn disbursement for acquisitions and € 31.8 mn in purchases of treasury shares)

S. Ilario d'Enza, 10 November 2020 – The Board of Directors of Interpump Group S.p.A. met today and approved the consolidated Interim Report at 30/09/2020.

Q3 2020 RESULTS

Net Sales for the third quarter of 2020 totaled 314.7 million euro, a decrease of 2.5% from the 322.9 million euro in the corresponding period of 2019.

Sales by business sector and geographical area were as follows:

(€/000)

					Rest of
Q3 2020	Italy	Rest of Europe	North America	Pacific Area	the World	Total
Hydraulics Water-Jetting Total	38,836 8,085 46,921	74,948 38,943 113,891	49,958 30,866 80,824	30,238 14,832 45,070	21,293 6,702 27,995	215,273 99,428 314,701
Q3 2019 Hydraulics Water-Jetting Total	39,320 9,901 49,221	72,772 42,422 115,194	56,366 36,168 92,534	19,408 18,955 38,363	18,962 8,656 27,618	206,828 116,102 322,930

Organic growth, at unchanged perimeter and before the currency exchange, was -10.8% (-13.1% for Water-Jetting and -9.5% for Hydraulics)

EBITDA amounted to 76.0 million euro (24.2% of sales) compared to 78.1 million euro in the third quarter of 2019 (also 24.2% of sales)

Consolidated Net Profit for the third quarter of 2020 was 39.5 million euro, compared to 43.3 million euro for Q3 2019.

CONSOLIDATED RESULTS FOR THE FIRST NINE MONTHS OF 2020

Net Sales for the first nine months of 2020 totaled 954.2 million euro, a decrease of 7.0% from the 1,026.1 million euro in the corresponding period of 2019.

Sales by business sector and geographical area were as follows:

(€/000)

9M 2020	Italy	Rest of Europe	North America	Pacific Area	Rest of the World	Total
Hydraulics Water-Jetting Total	118,689 26,238 144,927	229,474 114,229 343,703	161,053 98,201 259,254	82,686 43,804 126,490	52,983 26,880 79,863	644,885 309,352 954,237
9M 2019
Hydraulics	137,819	245,069	168,701	63,170	66,472	681,231
Water-Jetting	30,990	128,143	110,518	46,772	28,479	344,902
Total	168,809	373,212	279,219	109,942	94,951	1,026,133

Organic growth, at unchanged perimeter and before the currency exchange, was -16.2% (-19.3% in Hydraulics, -10.2% in Water-Jetting)

EBITDA amounted to 215.3 million euro (22.6% of sales) compared to 240.2 million euro in the first nine months of 2019 (23.4% of sales). The following table sets out EBITDA by business sector:

	9M 2020	% on	9M 2019	% on
	€/000	sales	€/000	sales	Change
Hydraulics	132,885	20.6%	144,598	21.2%	-8.1%
Water-Jetting	82,369	26.5%	95,687	27.6%	-13.9%
Total	215,254	22.6%	240,285	23.4%	-10.4%

Operating income (EBIT) was 148.5 million euro compared to 189.1 million euro in the first nine months of 2019.

Consolidated Net Profit for the first nine months of 2020 was 103.0 million euro (was 135.5 million euro in 9M 2019).

Net cash flow from operating activities was 182.5 million euro (195.3 million euro in the corresponding period of 2019). Free cash flow in the first nine months amounted to 148.6 million euro (76.0 million euro in the first nine months of 2019).

Net debt at 30 September 2020 was 310.7 million euro (370.8 million euro at 31 December 2019). In the first nine months of the year, 31.8 million euro were spent in treasury shares, while disbursments for acquisitions amounted to 48.4 million euro. Additionally, at the end of September the Group had commitments for the acquisition of stakes in subsidiaries for a total of 58.0 million euro (54.3 million euro at 31/12/2019).

Capital employed went from 1,480.2 million euro at 31 December 2019 to 1,478.1 million euro at 30 September 2020, due to the opposite effects of the reduction of net working capital, on one side, and the acquisition of Transtecno on the other. Non-annualized ROCE was 10.0% (13.7% in 9M 2019). Nonannualized ROE was 9.3% (14.2% in 9M 2019).

At 30 September 2020 Interpump Group S.p.A. had 1,770,006 treasury shares in its portfolio, representing 1.625% of total share capital, purchased at an average cost of € 26.171.

UPDATE ON COVID-19 PANDEMIC

The third quarter and the following weeks saw the continuation of the much-awaited increase trend in both sales and orders, which brought as a consequence the pickup of activity at all Group production sites.

Thanks also to strict compliance with safety provisions, both legal and corporate, Interpump's working environments can be considered to be at almost negligible risk of infection. The only fatal case of Covid-19 among the Group's 8,000+ employees, registered in the United States, has been traced back to a contagion occurred outside of the workplace.

Pursuant to Article 65-bis, paragraph 2 of Consob Deliberation 11971/1999 as modified and supplemented, the Interim Report at 30 September 2020 is available to the public at the Group's registered office and may be also be consulted on the "Financial Statements and Reports" page in the

"Investor relations" section of the Group's website www.interpumpgroup.it, as well on the repository.

S. Ilario d'Enza (RE), 10 November 2020 On behalf of the Board of Directors

Fulvio Montipò, Chairman

Carlo Banci, the manager responsible for drafting the company's accounting documents, declares - pursuant to the terms Article 154-bis, paragraph 2 of the Consolidated Financial Services Act - that the accounting disclosures in the present release correspond to the contents of the underlying documents, the accounting books and the accounting entries.

Sant'Ilario d'Enza (RE), 10 November 2020 Carlo Banci

Manager responsible for drafting the company's accounting documents

Media Relations: Investor Relations: Moccagatta Associati Luca Mirabelli Tel. 02 8645,1695 Tel. 0522-904433 segreteria@moccagatta.it lmirabelli@interpumpgroup.it

Consolidated Statement of financial position

(€/000)	30/09/2020	31/12/2019
ASSETS
Current assets
Cash and cash equivalents	290,254	233,784
Trade receivables	256,500	284,842
Inventories	393,193	408,443
Tax receivables	19,969	24,337
Other current assets	12,603	9,077
Total current assets	972,519	960,483
Non-current assets
Property, plant and equipment	478,674	484,358
Goodwill	541,654	508,670
Other intangible assets	44,483	32,527
Other financial assets	2,224	4,226
Tax receivables	902	1,590
Deferred tax assets	34,762	34,679
Other non-current assets	2,159	2,150
Total non-current assets	1,104,858	1,068,200
Total assets	2,077,377	2,028,683

(€/000)	30/09/2020	31/12/2019
LIABILITIES
Current liabilities
Trade payables	133,164	157,413
Payables to banks	11,280	22,076
Interest bearing financial payables (current portion)	166,807	195,110
Taxes payable	20,865	14,965
Other current liabilities	72,366	90,230
Provisions for risks and charges	4,403	4,055
Total current liabilities	408,885	483,849
Non-current liabilities
Interest-bearing financial payables	422,843	387,412
Liabilities for employee benefits	23,161	21,402
Deferred tax liabilities	43,864	42,154
Tax liabilities	133	125
Other non-current liabilities	58,601	35,610
Provisions for risks and charges	10,505	3,057
Total non-current liabilities	559,107	489,760
Total liabilities	967,992	973,609
SHAREHOLDERS' EQUITY
Share capital	55,696	55,460
Legal reserve	11,323	11,323
Share premium reserve	95,438	96,733
Remeasurement reserve for defined benefit plans	(7,358)	(7,358)
Translation reserve	(15,597)	7,735
Other reserves	959,991	885,446
Group shareholders' equity	1,099,493	1,049,339
Minority interests	9,892	5,735
Total shareholders' equity	1,109,385	1,055,074
Total shareholders' equity and liabilities	2,077,377	2,028,683

Consolidated income statement for the first nine months

(€/000)	2020	2019
Net sales	954,237	1,026,133
Cost of sales	(611,700)	(648,922)
Gross industrial margin	342,537	377,211
% of net sales	35.9%	36.8%
Other operating income	13,255	14,492
Distribution expenses	(84,970)	(91,563)
General and administrative expenses	(110,819)	(107,111)
Other operating costs	(11,519)	(3,965)
EBIT	148,484	189,064
% of net sales	15.6%	18.4%
Financial income	9,164	9,356
Financial charges	(17,253)	(10,941)
Equity method contribution	155	23
Profit for the period before taxes	140,550	187,502
Income taxes	(37,543)	(51,993)
Consolidated profit for the period	103,007	135,509
% of net sales	10.8%	13.2%
Attributable to:
Shareholders of Parent	101,443	134,575
Minority shareholders of subsidiaries	1,564	934
Consolidated profit for the period	103,007	135,509
EBITDA	215,254	240,285
% of net sales	22.6%	23.4%
Shareholders' equity	1,109,385	951,992
Net debt	310,676	382,895
Payables for purchase of shareholdings	58,021	40,376
Capital employed	1,478,082	1,375,263
Non-annualized ROCE	10.0%	13.7%
Non-annualized ROE	9.3%	14.2%
Basic earnings per share	0.946	1.280

Consolidated statement of comprehensive income for the first nine months

(€/000)	2020	2019
Consolidated profit for the first half-year (A)	103,007	135,509
Other comprehensive income which will subsequently be reclassified to consolidated profit or loss
Gains (losses) on translating the financial statements of foreign companies	(23,726)	14,872
Gains (losses) from companies accounted for using the equity method	(81)	20
Applicable taxes	-	-
Total other consolidated income (losses) which will
subsequently be reclassified to consolidated profit for the period, net of the tax effect (B)	(23,807)	14,892
Consolidated comprehensive income for the period (A)+(B)	79,200	150,401
Attributable to:
Shareholders of Parent	78,111	149,320
Minority shareholders of subsidiaries	1,089	1,081
Consolidated comprehensive income for the first half-year	79,200	150,401

Consolidated income statement for the third quarter

(€/000)	2020	2019
Net sales	314,701	322,930
Cost of sales	(200,050)	(202,335)
Gross industrial margin	114,651	120,595
% of net sales	36.4%	37.3%
Other operating income	4,391	4,368
Distribution expenses	(26,169)	(28,716)
General and administrative expenses	(35,087)	(34,659)
Other operating costs	(1,269)	(805)
EBIT	56,517	60,783
% of net sales	18.0%	18.8%
Financial income	2,300	3,196
Financial charges	(5,341)	(3,779)
Equity method contribution	42	26
Profit for the period before taxes	53,518	60,226
Income taxes	(13,979)	(16,930)
Consolidated profit for the period	39,539	43,296
% of net sales	12.6%	13.4%
Attributable to:
Shareholders of Parent	38,926	43,064
Minority shareholders of subsidiaries	613	232
Consolidated profit for the period	39,539	43,296
EBITDA	76,004	78,109
% of net sales	24.2%	24.2%
Shareholders' equity	1,109,385	951,992
Net debt	310,676	382,895
Payables for purchase of shareholdings	58,021	40,376
Capital employed	1,478,082	1,375,263
Non-annualized ROCE	3.8%	4.4%
Non-annualized ROE	3.6%	4.5%
Basic earnings per share	0.363	0.411

Consolidated statement of comprehensive income for the third quarter

(€/000)	2020	2019
Consolidated profit for the second quarter (A)	39,539	43,296
Other comprehensive income which will subsequently be reclassified to consolidated profit or loss
Gains (losses) on translating the financial statements of foreign companies	(14,661)	12,186
Gains (losses) from companies accounted for using the equity method	(19)	2
Applicable taxes	-	-
Total other consolidated income (losses) which will
subsequently be reclassified to consolidated profit for the period, net of the tax effect (B)	(14,680)	12,188
Consolidated comprehensive income for the period (A)+(B)	24,859	55,484
Attributable to:
Shareholders of Parent	24,424	55,229
Minority shareholders of subsidiaries	435	255
Consolidated comprehensive income for the second quarter	24,859	55,484

Consolidated cash flow statement for the first nine months

(€/000)	2020	2019
Cash flows from operating activities
Profit before taxes	140,550	187,502
Adjustments for non-cash items:
Losses (gains) on the sale of fixed assets	(2,018)	(2,028)
Amortization and depreciation	58,364	50,341
Costs recognized in the income statement relative to stock options that do not involve monetary outflows for the Group	2,460	1,761
Losses (profits) from investments	(155)	(23)
Net change in risk provisions and allocations to employee benefit provisions	7,690	(89)
Expenditures for tangible assets to be leased	(3,566)	(4,450)
Proceeds from the disposal of leased tangible assets	4,187	6,702
Net financial charges (revenues)	8,089	1,585
	215,601	241,301
(Increase) decrease in trade receivables and other current assets	34,058	(9,009)
(Increase) decrease in inventories	17,815	(18,552)
Increase (decrease) in trade payables and other current liabilities	(27,973)	(26,156)
Interest paid	(3,658)	(4,178)
Realized exchange differences	(2,475)	799
Taxes paid	(26,937)	(42,660)
Net cash from operating activities	206,431	141,545
Cash flows from investing activities
Payments for the purchase of investments net of cash received	(39,092)	(26,413)
Capital expenditure on property, plant and equipment	(44,052)	(54,305)
Proceeds from the sale of tangible fixed assets	1,198	1,155
Increase in intangible assets	(2,876)	(1,974)
Financial income received	829	706
Other	877	217
Net cash (used in) investing activities	(83,116)	(80,614)
Cash flows from financing activities
Disbursements (repayments) of loans	7,160	49,485
Dividends paid	(28,185)	(23,752)
Disbursements for purchase of treasury shares	(31,847)	(48,764)
Proceeds from the sale of treasury shares to stock option beneficiaries	14,278	3,436
Repayment (grant) of leases to subsidiaries not consolidated line-by-line	-	(384)
Change in other financial assets	21	(48)
Payment of finance lease installments (principal)	(13,764)	(12,538)
Net cash generated by (used in) financing activities	(52,337)	(32,565)
Net increase (decrease) in cash and cash equivalents	70,978	28,366

(€/000)	2020	2019
Net increase (decrease) in cash and cash equivalents	70,978	28,366
Translation differences for cash held by non-EU companies	(3,760)	1,229
Opening cash and cash equivalents of companies consolidated on a line-by-line basis for the first time	48	(34)
Cash and cash equivalents at the beginning of the period	211,708	96,736
Cash and cash equivalents at the end of the period	278,974	126,927

Cash and cash equivalents consist of the following:

	30/09/2020 €/000	31/12/2019 €/000
Cash and cash equivalents as per the consolidated statement of financial position	290,254	233,784
Bank payables (overdrafts and subject to collection advances)	(11,280)	(22,076)
Cash and cash equivalents as per the consolidated cash flow statement	278,974	211,708

Consolidated statement of changes in shareholders' equity

	Share capital	Legal reserve	Share premium reserve	Remeasure ment reserve for defined benefit plans	Translation reserve	Other reserves	Group shareholders' equity	Non controlling interests	Total
At 1 January 2019	54,842	11,323	71,229	(5,965)	3,142	729,373	863,944	4,961	868,905
Recognition in income statement of fair value of stock options granted and exercisable	-	-	1,761	-	-	-	1,761	-	1,761
Purchase of treasury shares	(945)	-	(47,819)	-	-	-	(48,764)	-	(48,764)
Transfer of treasury shares to stock option beneficiaries	155	-	3,281	-	-	-	3,436	-	3,436
Dividends paid	-	-	-	-	-	(23,200)	(23,200)	(547)	(23,747)
Comprehensive income (loss) for first nine months of 2019	-	-	-	-	14,745	134,575	149,320	1,081	150,401
At 30 September 2019	54,052	11,323	28,452	(5,965)	17,887	840,748	946,497	5,495	951,992
Recognition in income statement of fair value of stock options granted and exercisable	-	-	824	-	-	-	824	-	824
Transfer of treasury shares to stock option beneficiaries	16	-	371	-	-	-	387	-	387
Transfer of treasury shares as payment for equity investments	1,976	-	96,731	-	-	-	98,707	-	98,707
Purchase of treasury shares	(584)	-	(29,645)	-	-	-	(30,229)	-	(30,229)
Dividends distributed	-	-	-	-	-	-	-	(128)	(128)
Dividends resolved (third parties)	-	-	-	-	-	-	-	(99)	(99)
Reggiana Riduttori minorities	-	-	-	-	-	-	-	175	175
Purchase of residual share of subsidiaries	-	-	-	-	-	103	103	(153)	(50)
Comprehensive income (loss) for the fourth quarter of 2019	-	-	-	(1,393)	(10,152)	44,595	33,050	445	33,495
At 31 December 2019	55,460	11,323	96,733	(7,358)	7,735	885,446	1,049,339	5,735	1,055,074
Recognition in income statement of fair value of stock options granted and exercisable	-	-	2,460	-	-	-	2,460	-	2,460
Purchase of treasury shares	(594)	-	(31,253)	-	-	-	(31,847)	-	(31,847)
Transfer of treasury shares to stock option beneficiaries	576	-	13,702	-	-	-	14,278	-	14,278
Transfer of treasury shares as payment for equity investments	254	-	13,796	-	-	-	14,050	-	14,050
Minorities of subsidiaries consolidated for the first time	-	-	-	-	-	-	-	4,283	4,283
Dividends paid	-	-	-	-	-	(26,898)	(26,898)	(1,215)	(28,113)
Comprehensive income (loss) for first nine month of 2020	-	-	-	-	(23,332)	101,443	78,111	1,089	79,200
At 30 September 2020	55,696	11,323	95,438	(7,358)	(15,597)	959,991	1,099,493	9,892	1,109,385