JENSEN-GROUP N.V. — Interim / Quarterly Report 2016

Aug 18, 2016

Regulated information

JENSEN-GROUP Half-Year Results 2016

Consolidated, non-audited key figures

Income Statement 30/06/2016- 30/06/2015 Non-audited, consolidated key figures

			June 30, 2016 June 30, 2015	Change
	(million euro)	6M	6M
Revenue		164,4	150,6	9,2%
EBIT		13,9	13,5	2,6%
Cash flow (EBITDA) 1		15,3	16,9	-9,0%
Financial result		-0,8	-1,2	-37,4%
Profit before taxes		13,0	12,3	6,2%
Taxes		-3,4	-3,0	16,5%
Net income continuing operations		9,6	9,3	3,0%
Result from discontinued operations		-0,2	0,0	240,9%
Net income (Group share in the profit)		9,5	9,3	1,8%
Net cash flow 2		11,1	12,7	-12,7%

Balance sheet as of 30/06/2016- 31/12/2015 Non-audited, consolidated key figures

			June 30, 2016 Dec 31, 2015	Change
	(million euro)	6M	12M
Equity		92,5	87,1	6,2%
Net financial debt		9,9	0,1	13218,9%
Assets held for sale		0,5	0,5	-2,0%
Total assets		200,0	186,6	7,2%

Non-audited, consolidated key figures per share

	June 30, 2016 June 30, 2015		Change
(euro)	6M	6M
Cash flow (EBITDA) 1	1,96	2,16	-9,3%
Profit before taxes	1,67	1,57	6,4%
Profit after taxes continuing operations (EPS)	1,23	1,19	3,4%
Net cash flow 2	1,41	1,62	-13,0%
Equity (June 30, 2016 - December 31, 2015)	11,84	11,14	6,3%
Number of shares (end of period)	7.818.999	7.818.999
Number of shares (average)	7.818.999	7.818.999

1 EBITDA = earnings before interest, taxes, depreciation and amortization; This is operating profit plus depreciation and amounts written off on stocks, trade debtors, impairment losses and provisions for liabilities and charges.

²The net cash flow is the net income (Group share in the profit) excluding depreciation, amounts written off on stocks, trade debtors, impairment losses and provisions for liabilities and charges.

Interim Financial Information June 30, 2016

Financial review and highlights half-year results 2016

• Revenue of the first half-year of 2016 amounts to 164.4 million euro, a 9.2% increase compared to last year.
• Operating profit (EBIT) for the first six months amounts to 13.9 million euro, which is 2.6% higher than last year.
• Cash flow (EBITDA) for the first half-year amounts to 15.3 million euro, a 9.1% decrease compared to last year.
• Net profit from the continuing operations amounts to 9.6 million euro (Earnings per Share of 1.23 euro), an increase of 3% compared to last year.
• Net financial debt amounts to 9.9 million euro and increased by 9.8 million euro compared to December 2015.

Operating activities

• Revenue
• o Although the Group started from a slightly lower order backlog at the beginning of the year, the turnover was higher than in the first half of 2015.
• o At June 30, 2016 the order backlog increased by 34% compared to the backlog at June 30, 2015. Considering the finished goods and work in progress, production backlog is 47% higher than as at June 2015. Management estimates that approximately 26% of this production backlog relates to revenues in 2017 and later.
• EBIT
• o Consolidated EBIT increased from 13.5 million euro to 13.9 million euro (+2.6%) thanks to the higher activity level.
• o The intense competition on large projects and further investments in production capacity, sales force and product development in preparation for growth have held back further increases in profitability.

Report of the Board of Directors

Important developments of the first 6 months

Revenue is higher than the first half-year of 2015 (164.4 million euro compared to 150.6 million euro prior year) despite a slightly lower order backlog at the beginning of the year.

The operating profit increased by 2.6% compared to the last year. The intense competition on large projects and further investments in production capacity, sales force and product development in preparation for growth have held back further increases in profitability.

The financial result was 0.4 million euro higher than prior year due to lower currency losses.

All the items described above resulted in a 0.3 million euro increase in the Groups net income from continuing operations (from 9.3 million euro to 9.6 million euro).

On January 29, 2016 JENSEN-GROUP acquired an equity stake of 30% in TOLON GLOBAL MAKINA Sanyi Ve Tikaret Sirketi A.S., Turkey and agreed to acquire in total an additional 19% of the shares over the coming three years.

In March 2016 JENSEN-GROUP opened a Sales and Service Center in Denmark. On July 1, 2016 JENSEN-GROUP took over the activities of its distributor in Norway.

Outlook for the remaining 6 months

At June 30, 2016 the order backlog increased by 34% compared to the backlog at June 30, 2015. Considering the finished goods and work in progress, production backlog is 47% higher than as at June 2015. Management estimates that approximately 26% of this production backlog relates to revenues in 2017 and later.

The intense competition on large projects and further investments in production capacity, sales force and product development in preparation for growth will continue to hold back further increases in profitability.

The most important risk factors remain rapid changes in demand, availability of financing to our customers, high exchange rate volatility and fluctuating raw material, energy and transport prices.

Important transactions with related parties

There were no important transactions with related parties.

Events after balance sheet date

There are no significant after balance sheet events.

Ghent, August 18, 2016

Raf Decaluwé Jesper M. Jensen Chairman of the Board of Directors Chief Executive Officer

Statement of the Responsible Persons

We hereby certify that, to the best of our knowledge, the condensed consolidated financial statements for the six months period ended June 30, 2016 which has been prepared in accordance with the IAS 34 "Interim Financial Reporting" as adopted by the European Union, gives a true and fair view of the assets, liabilities, financial position and profit or loss of the company and the entities included in the consolidation as a whole, and that the interim management report includes a fair review of the important events that have occurred during the first six months of the financial year and of the major transactions with the related parties, and their impact on the condensed consolidated financial statements, together with a description of the principal risks and uncertainties for the remaining six months of the financial year.

Ghent, August 18, 2016

Jesper M. Jensen Markus Schalch Chief Executive Officer Chief Financial Officer

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

	(in thousands of euro)	Notes	June 30 2016	December 31 2015
Total Non-Current Assets			43.603	39.520
Intangible assets			6.578	6.637
Property, plant and equipment			25.770	23.176
Share in equity of companies consolidated under equity method			2.254	0
Trade and other long term receivables			3.023	3.491
Deferred taxes			5.978	6.216
Total Current Assets			156.370	147.085
Advance payments			1.697	2.754
A. Trade debtors B. Other amounts receivable C. Gross amounts due from customers for contract work D. Derivative Financial Instruments Trade and other receivables			61.722 4.707 77.589 179 144.197	63.829 3.496 60.249 85 127.659
Cash and cash equivalents		4	10.025	16.212
Assets held for sale			451	460
TOTAL ASSETS			199.973	186.605

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(in thousands of euro) Notes	June 30 2016	December 31 2015
Equity attributable to equity holders	92.541	87.120
Share Capital	36.523	34.068
Other reserves	-3.930	-3.022
Retained earnings	59.948	56.074
Non Current Liabilities	30.053	26.465
Borrowings	15.147	11.359
Deferred income tax liabilities	174	142
Provisions for employee benefit obligations	14.301	14.445
Derivative financial instruments	431	519
Current Liabilities	77.379	73.020
Borrowings	4.734	4.927
Provisions for other liabilities and charges	11.561	12.162
A. Trade debts	23.045	15.850
B. Advances received for contract work	11.042	14.896
C. Remuneration and social security	13.629	11.621
D. Other amounts payable	1.771	2.319
E. Accrued expenses	7.648	6.096
F. Derivative financial instruments	260	232
Trade and other payables	57.395	51.014
Current income tax liabilities	3.689	4.917
TOTAL EQUITY AND LIABILITIES	199.973	186.605

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	June 30	June 30
(in thousands of euro) Notes	2016	2015
Revenue 3	164.432	150.647
Total expenses	-150.634	-137.349
Other Income / ( Expense)	76	219
Operating profit before tax and finance (cost)/ income	13.874	13.517
	-773	-1.235
Net financial charges Share in result of associates and joint ventures accounted	-57	0
for using the equity method
Profit before tax	13.044	12.282
Income tax expense	-3.438	-2.952
Profit for the half-year from continuing operations	9.606	9.330
Result from discontinued operations	-150	-44
Consolidated profit for the half-year	9.456	9.286
Other comprehensive income:
Items that may be subsequently reclassed to Profit and Loss
Financial instruments	167	380
Currency translation differences	-979	2.415
Items that will not be reclassed to Profit and Loss
Actual gains/(losses) on Defined Benefit Plans	-66	-846
Tax on items taken directly on or transferred from equity	-30	140
TOTAL OTHER COMPREHENSIVE INCOME/(LOSS) FOR THE HALF-YEAR	-908	2.089
TOTAL COMPREHENSIVE INCOME FOR THE HALF-YEAR	8.548	11.375
Profit attributable to:
Equity holders of the company	9.456	9.286
Total comprehensive income attributable to:
Equity holders of the company	8.548	11.375
Basic and diluted earnings per share (in euro's)	1,21	1,19
Weighted average number of shares	7.818.999	7.818.999

	Capital	Share premium	Reclassificati on of Treasury	Total Share Capital	Translation differences	Hedging Reserves	Actuarial gains and losses on Defined	Total other Reserves	Retained earnings	Total Equity
In thousands of euro			shares				Benefit Plans
December 31, 2014	30.710	5.813	-2.455	34.068	2.003	-602	-7.013	-5.612	41.644	70.100
Result of the period	0	0	0	0	0	0	0	0	9.286	9.286
Other comprehensive income
Currency Translation Difference	0	0	0	0	2.415	0	0	2.415	0	2.415
Financial instruments	0	0	0	0	0	380	0	380	0	380
Defined Benefit Plans	0	0	0	0	0	0	-846	-846	0	-846
Tax on items taken directly to or transferred	0	0	0	0	0	-114	254	140		140
Total other comprehensive income/(loss)
for the half-year, net of tax	0	0	0	0	2.415	266	-592	2.089	0	2.089
Dividend paid out	0	0	0	0	0	0	0	0	-3.113	-3.113
Treasury Shares	0	0	0	0	0	0	0	0	0	0
June 30, 2015	30.710	5.813	-2.455	34.068	4.418	-336	-7.605	-3.523	47.817	78.362

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(In thousands of euro)	Capital	Share premium	Reclassificati on of Treasury shares	Total Share Capital	Translation differences	Hedging Reserves	Actuarial gains and losses on Defined Benefit Plans	Total other Reserves	Retained earnings	Total Equity
December 31, 2015	30.710	5.813	-2.455	34.068	4.244	-412	-6.854	-3.022	56.074	87.120
Result of the period	0	0	0	0	0	0	0	0	9.456	9.456
Other comprehensive income
Currency Translation Difference Financial instruments Defined Benefit Plans	0 0 0	0 0 0	0 0 0	0 0 0	-979 0 0	0 167 0	0 0 -66	-979 167 -66	0 0 0	-979 167 -66
Tax on items taken directly to or transferred	0	0	0	0	0	-50	20	-30	0	-30
Total other comprehensive income/(loss) for the half-year, net of tax	0	0	0	0	-979	117	-46	-908	0	-908
Dividend paid out	0	0	0	0	0	0	0	0	-3.127	-3.127
Treasury shares	0	0	2.455	2.455	0	0	0	0	-2.455	0
June 30, 2016	30.710	5.813	0	36.523	3.265	-295	-6.900	-3.930	59.948	92.541

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

(in thousands of euro) Notes	June 30 2016	June 30 2015
Cash flows from operating activities Changes in working capital	15.351 -8.817	16.198 -26.323
Corporate income tax paid	-4.666	-2.239
Net cash flow from operating activities - continuing operations	1.868	-12.364
Net cash flow from operating activities - discontinued operations	-141	-79
Net cash flow from operating activities - total	1.727	-12.443
Net cash flow from investment activities	-6.630	-4.701
Cash flow before financing	-4.903	-17.144
Net cash flow from financial activities	184	2.231
Net Change in cash and cash equivalents	-4.719	-14.913
Cash, cash equivalent and bank overdrafts at the beginning of the year	12.172	11.608
Exchange gains/(losses) on cash and bank overdrafts	-979	2.415
Cash, cash equivalent and bank overdrafts at the end of the period 4	6.474	-890

Notes to the condensed consolidated financial statements

Note 1 - Basis of Preparation

The JENSEN-GROUP (hereafter "The Group") is one of the major suppliers to the heavy-duty laundry industry. The Group markets its products and services under the JENSEN brand and is a leading supplier to the heavy-duty market. The product range varies from transportation and handling systems, tunnel washers, separators, feeders, ironers and folders to complete project management for fully-equipped and professionally managed industrial laundries. The JENSEN-GROUP has operations in 22 countries and distributes its products in more than 40 countries. Worldwide, the JENSEN-GROUP employs approximately 1,550 people.

JENSEN-GROUP N.V. (hereafter "The Company") is incorporated in Belgium. Its registered office is at Bijenstraat 6, 9051 Sint-Denijs-Westrem, Belgium.

The JENSEN-GROUP shares are quoted on the Euronext Stock Exchange.

This condensed consolidated interim financial information is for the first half-year ended June 30, 2016. These interim financial statements are prepared in accordance with IAS 34 "Interim Financial Reporting", as adopted by the EU. The accounting policies used in the preparation of the interim financial statements are consistent with those used in the annual financial statements for the year ended December 31, 2015.

This condensed consolidated interim financial information should be read in conjunction with the 2015 annual IFRS consolidated financial statements.

This condensed consolidated interim financial information has not been audited by the external auditor.

The policies have been consistently applied to all the periods presented.

Taxation is determined annually and, accordingly, the tax charge for the interim period involves making an estimate of the likely effective tax rate for the year. The calculation of the effective tax rate is based on an estimate of the tax charge or credit for the year

expressed as a percentage of the expected accounting profit or loss. This percentage is then applied to the interim result, and the tax is recognized rateably over the year as a whole.

This condensed consolidated interim financial information has been prepared in accordance with those IFRS standards and IFRIC interpretations issued and effective or issued and early adopted as at 30 June 2016 which have been adopted by the European Union, as follows:

The following interpretation and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2016:

• Amendment to IFRS 11 'Joint arrangements' on acquisition of an interest in a joint operation, effective for annual periods beginning on or after 1 January 2016.
• Amendment to IAS 16 'Property, plant and equipment' and IAS 38 'Intangible assets' on depreciation and amortisation, effective for annual periods beginning on or after 1 January 2016.
• Amendment to IAS 16 'Property, plant and equipment' and IAS 41 'Agriculture' on bearer plants, effective for annual periods beginning on or after 1 January 2016.
• Amendments to IAS 27 'Separate financial statements' on the equity method, effective for annual periods beginning on or after 1 January 2016.
• Amendments to IAS 1 'Presentation of financial statements', effective for annual periods beginning on or after 1 January 2016.
• Amendment to IAS 19, 'Employee benefits', on defined benefit plans (effective 1 July 2014 and endorsed for 1 Feb 2015).
• Annual improvements 2010-2012 (effective 1 July 2014 and endorsed for 1 Feb 2015). These amendments include changes from the 2010-12 cycle of the annual improvements project, that affect 7 standards: IFRS 2, 'Share-based payment', IFRS 3, 'Business Combinations', IFRS 8, 'Operating segments', IFRS 13, 'Fair value measurement', IAS 16, 'Property, plant and equipment', and IAS 38, 'Intangible assets', Consequential amendments to IFRS 9, 'Financial instruments', IAS 37, 'Provisions, contingent liabilities and contingent assets', and IAS 39, Financial instruments – Recognition and measurement'.
• Annual improvements 2012-2014 (effective and endorsed for 1 January 2016). These set of amendments impacts 4 standards: IFRS 5, 'Non-current assets held for sale and discontinued operations' regarding methods of disposal; IFRS 7, 'Financial instruments: Disclosures', (with consequential amendments to IFRS 1) regarding

servicing contracts; IAS 19, 'Employee benefits' regarding discount rates; IAS 34, 'Interim financial reporting' regarding disclosure of information.

The following interpretation and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2016 (however yet subjected to EU endorsement):

• Amendments to IFRS 10 'Consolidated financial statements', IFRS 12 'Disclosure of interests in other entities' and IAS 28, 'Investments in associates and joint ventures', effective for annual periods beginning on or after 1 January 2016.
• IFRS 14 'Regulatory deferral accounts', effective for annual periods beginning on or after 1 January 2016.

The following new standards and amendments to standards have been issued, but are not mandatory for the first time for the financial year beginning 1 January 2016 and have not been endorsed by the European Union:

• IFRS 9 'Financial instruments', effective for annual periods beginning on or after 1 January 2018.
• IFRS 15 'Revenue from contracts with customers'.
• Amendments to IFRS 15, 'Revenue from contracts with customers' Clarifications (effective 1 January 2018).
• IFRS 16 'Leases'.
• Amendments to IAS 12,'Income taxes' on Recognition of deferred tax assets for unrealised losses (effective 1 January 2017).
• Amendments to IAS 7, Statement of cash flows (effective 1 January 2017).
• Amendments to IFRS 10, 'Consolidated financial statements' and IAS 28,'Investments in associates and joint ventures', for which the effective date still has to be determined.
• Amendments to IFRS 2: Classification and Measurement of Share-based Payment Transactions (issued on 20 June 2016 and effective on 1 January 2018).

The Group is currently assessing the impact of the new requirements.

This condensed consolidated interim financial information is prepared under the historical cost convention, as modified by the revaluation of available-for-sale financial assets, and financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

This condensed consolidated interim financial information is prepared on an accrual basis and on the assumption that the Group is a going concern and will continue in operation for the foreseeable future.

The preparation of the condensed consolidated interim financial information in accordance with IAS 34 requires management to make estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in the accounting policies.

Note 2 – Changes in accounting policies and other changes, and their impact on equity

There are no changes in the accounting policies compared with the accounting policies used in the preparation of the consolidated financial statements as per December 31, 2015.

Note 3 – Segment reporting

The total laundry industry can be split up into consumer, commercial and heavy-duty laundry. The JENSEN-GROUP entities serve end-customers in the Heavy Duty laundry segment. They follow the same process. The JENSEN-GROUP sells its products and services under the JENSEN brand through own sales and service companies and independent distributors worldwide. In this way the JENSEN-GROUP operates only in one single segment.

The following table presents revenue and non-current asset information based on the

Group's geographical areas:

		Europe + CIS		America		Middle East, Far East and Australia		TOTAL OPERATIONS
(in thousand of euro)	June 16	June 15	June 16	June 15	June 16	June 15	June 16	June 15
Revenue from external customers	91.654	88.841	41.238	33.771	31.540	28.035	164.432	150.647
Other segment information
Non-current assets	29.474	25.583	2.997	2.720	5.154	2.698	37.625	31.001

Note 4 - Cash flow statement

Cash, cash equivalent and bank overdrafts include the following for the purpose of the cash flow statement:

	June 30	June 30
(in thousands of euro)	2016	2015
Cash	10.025	8.872
Bank overdrafts	-3.551	-9.762
Cash, cash equivalent and bank overdrafts at the end of the period	6.474	-890

The net debt increased because of higher activity and the investments in capacity expansion.

Note 5 – Commitments and contingencies

There are no major changes compared to December 31, 2015.

Note 6 – Scope of consolidation

On January 29, 2016 JENSEN-GROUP acquired an equity stake of 30% in TOLON GLOBAL MAKINA Sanyi Ve Tikaret Sirketi A.S., Turkey. This participation is consolidated under the equity method.

On February 4, 2015, JENSEN-GROUP opened JENSEN Spain as it took over the business activities of their Spanish distributor Boaya S.L.

Note 7 - Related party transactions

The shareholders of the Group as per June 30, 2016 are:

JENSEN Invest:	53.6%
Free float:	46.4%

There are no significant changes in compensation of key management.

Note 8 – Acquisitions

On January 29, 2016 JENSEN-GROUP acquired an equity stake of 30% in TOLON GLOBAL MAKINA Sanyi Ve Tikaret Sirketi A.S., Turkey and agreed to acquire in total an additional 19% of the shares over the coming three years.

The table below gives an overview of the acquisition-date fair value of the total consideration transferred and the remaining amount of goodwill recognized for the acquisition:

	(in thousands of euro)		2016
Non current assets			3.399
Current assets			3.387
Non current liabilities		-	3.950
Net assets acquired			2.836
Group share in net assets acquired			851
Goodwill			1.458
Purchase price			2.309
Net cash out for acquisitions of subsidiaries			2.309

The fair value of the assets and liabilities acquired in the above transaction is determined on a provisional basis. Any adjustment to the provisional amounts will be recorded within twelve months of acquisition date.

The contract includes an earn out clause. Management is considering the value of the possible earn out.

Note 9 - Events after balance sheet date

There are no significant after balance sheet events.