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Piovan Interim / Quarterly Report 2024
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Interim / Quarterly Report
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CONSOLIDATED HALF-YEAR FINANCIAL REPORT
at June 30, 2024
Index
| GOVERNANCE OF PIOVAN S.P.A. 3 |
|---|
| PIOVAN GROUP 8 |
| GROUP OVERVIEW 13 |
| General economic overview 14 |
| Significant events in the first half of 2024 16 |
| Group performance overview 21 |
| Principal risks and uncertainties to which the Group is exposed 32 |
| Subsequent events after June 30, 2024 33 |
| Outlook 36 |
| Other information 38 |
| CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AS AT AND FOR THE SIX MONTHS ENDED JUNE 30, 2024 41 |
| Consolidated financial statements at June 30, 2024 42 |
| Notes to the consolidated financial statements 47 |
| Explanatory Notes to the consolidated statement of financial position 60 |
| Explanatory Notes to the Consolidated Statement of Profit and Loss 75 |
| Other information 81 |
| DECLARATION OF THE CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AT JUNE 30, 2024 89 |
| AUDITORS' REPORT ON THE CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AT JUNE 30, 2024 91 |
COMPANY INFORMATION OF THE PARENT COMPANY PIOVAN S.P.A.
Registered Office: Via delle Industrie 16 – 30036 S. Maria di Sala (Venice) Italy
Telephone: +39 041 5799111
Certified e-mail: [email protected]
E-mail: [email protected]
Website: www.piovan.com
Share capital: Euro 6,000,000 fully paid-in
Tax No.: 02307730289 VAT No.: 02700490275
Venice Economic & Administrative Registration No. 235320
GOVERNANCE OF PIOVAN S.P.A.
Piovan S.p.a. ("the Company" or "the Parent Company") is the parent company of the group of the same name and headquartered in Via delle Industrie 16, Santa Maria di Sala (Venice), Italy. The Company's Board of Directors and Board of Statutory Auditors are as follows.
Board of Directors
In office until April 29, 2024, date of the Shareholders' AGM for the approval of the 2023 Annual Accounts.
| Name | In charge |
|---|---|
| Nicola Piovan | Executive Chairman |
| Filippo Zuppichin | Chief Executive Officer |
| Marco Maria Fumagalli () (*) | Independent Director |
| Manuela Grattoni (*) | Independent Director |
| Mario Cesari (*) | Independent Director |
| Antonella Lillo (*) | Independent Director |
| Maurizio Bazzo (*) | Independent Director |
(*) Independent Director pursuant to Article 147-ter, paragraph 4 of the CFA and recommendation No. 7 of the Corporate Governance Code.
(**) Director appointed Lead Independent Director as per recommendation No. 13 of the Corporate Governance Code.
In office since April 29, 2024 until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
| Name | In charge |
|---|---|
| Nicola Piovan | Executive Chairman |
| Filippo Zuppichin | Chief Executive Officer |
| Marco Maria Fumagalli () (*) | Independent Director |
| Manuela Grattoni (*) | Independent Director |
| Alessandra Bianchi (*) | Independent Director |
| Mario Cesari (*) | Independent Director |
| Antonella Lillo (*) | Independent Director |
(*) Independent Director pursuant to Article 147-ter, paragraph 4 of the CFA and recommendation No. 7 of the Corporate Governance Code.
(**) Director appointed Lead Independent Director as per recommendation No. 13 of the Corporate Governance Code.
We note that on July 31, 2024, all members of the Board of Directors in office submitted formal resignations. The effectiveness of these resignations will be subject to and take effect from the date on which the appointment of the new Board members (appointed by the Company's Shareholders' Meeting as part of the completion of the acquisition of the controlling by Automation Systems S.p.A.) becomes effective. For further details, see the section "Subsequent events after June 30, 2024".
Board of Statutory Auditors
In office until April 29, 2024, date of the Shareholders' AGM for the approval of the 2023 Annual Accounts.
| Name | In charge |
|---|---|
| Carmen Pezzuto | Chairman |
| Luca Bassan | Statutory Auditor |
| Patrizia Santonocito | Statutory Auditor |
| Kristian Sartor | Alternate Auditor |
| Stefania Targa | Alternate Auditor |
In office since April 29, 2024 until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
| Name | In charge |
|---|---|
| Carmen Pezzuto | Chairman |
| Luca Bassan | Statutory Auditor |
| Diletta Selvaggia Elena Stendardi | Statutory Auditor |
| Stefania Targa | Alternate Auditor |
| Federica De Pieri | Alternate Auditor |
Control, Risks and Sustainability Committee
In office until April 29, 2024, date of the Shareholders' AGM for the approval of the 2023 Annual Accounts.
| Name | In charge |
|---|---|
| Antonella Lillo | Chairman |
| Marco Maria Fumagalli | |
| Mario Cesari |
In office since April 29, 2024 until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
| Name | In charge |
|---|---|
| Marco Maria Fumagalli | Chairman |
| Mario Cesari | |
| Manuela Grattoni |
Nomination and Remuneration Committee
In office until April 29, 2024, date of the Shareholders' AGM for the approval of the 2023 Annual Accounts.
| Name | In charge |
|---|---|
| Manuela Grattoni | Chairman |
| Marco Maria Fumagalli | |
| Antonella Lillo |
In office since April 29, 2024 until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
| Name | In charge |
|---|---|
| Manuela Grattoni | Chairman |
| Alessandra Bianchi | |
| Antonella Lillo |
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In office until April 29, 2024, date of the Shareholders' AGM for the approval of the 2023 Annual Accounts.
| Name | In charge |
|---|---|
| Marco Maria Fumagalli | Chairman |
| Manuela Grattoni | |
| Mario Cesari |
In office since April 29, 2024 until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
| Name | In charge |
|---|---|
| Antonella Lillo | Chairman |
| Marco Maria Fumagalli | |
| Mario Cesari |
Supervisory Board (Organismo di Vigilanza)
In office from August 2, 2021, to April 30, 2024
| Name | In charge |
|---|---|
| Patrizia Santonocito | Chairman |
| Giovanni Boldrin | |
| Chiara Zilio |
Ms. Santonocito resigned as the Chair of the Supervisory Board, effective April 30, 2024, for personal reasons. The Board of Directors - noting this decision - on May 14, 2024 appointed Ms. Diletta Stendardi to replace Ms. Santonocito. Following this appointment, the composition of the Supervisory Board changes, as presented in the table below.
In Office until August 1, 2024
| Name | In charge |
|---|---|
| Diletta Selvaggia Elena Stendardi | Chairman |
| Giovanni Boldrin | |
| Chiara Zilio |
Corporate Financial Reporting Officer
Giovanni Rigodanza, in office until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
Independent Audit Firm
Deloitte & Touche S.p.A., in office until the Shareholders' AGM for the approval of the 2026 Annual Accounts.
Significant shareholders
Based on the shareholders' register, through communications received in accordance with Article 120 of Legislative Decree No. 58/98 and other information available to the company, the shareholders of Piovan S.p.A. with voting rights greater than 5% at the approval date of the Interim Report at June 30, 2024 were:
| Declarant | Direct shareholder | % of ordinary share capital (*) |
% of voting share capital (**) |
% of ordinary share capital (***) |
% of voting share capital (****) |
|---|---|---|---|---|---|
| Nicola Piovan | Pentafin S.p.A. | 58,350 | 68,962 | 61,174 | 71,419 |
(*) Total No. ordinary shares: 53,600,000, including Piovan S.p.A. treasury shares equal to 2,474,475.
(**) Share capital expressed as number of votes as per Article 120, paragraph 1 of Legislative Decree No. 58 of February 24, 1998 ("CFA") including Piovan S.p.A. treasury shares.
(***) Total No. ordinary shares: 51,125,525, excluding the Piovan S.p.A. treasury shares.
(****) Share capital expressed as number of votes as per Article 120, paragraph 1 of Legislative Decree No. 58 of February 24, 1998 ("CFA"), excluding Piovan S.p.A. treasury shares.
PIOVAN GROUP
Piovan Group operates in Italy and internationally in the production of systems for the automation of production processes for the storage, transport and treatment of polymers, recycled plastics and bio-resins ("Technical Polymers"), automation systems for the storage and transport of food fluids and food and non-food powders ("Food Systems & Industrial Applications"), and technical assistance and marketing of spare parts and services ("Services"). The Group is a global leader in the Technical Polymers market in the design and production of plants and control systems for the automation of all phases of the polymers, recycled plastics and bio-resins production cycle. In particular, over recent years the Group has been particularly engaged in developing and producing systems to automate production processes for the circular economy for recycling and reusing plastic and for the production of plastics which are naturally compostable.
History
The Group began operating in the early 1930's, when Costante Piovan founded a small workshop in Padua specializing in precision mechanics and molds for the manufacture of metal sheets.
In 1964, Luigi Piovan began a process of market diversification, and the Group moved into auxiliary machinery for the plastics industry. It introduced the first granulator to the Italian market, and this was followed by the Convair dryer and the Convector feeder for injection molding machines. The Group is increasingly specialized in the design and production of automation systems for the storage, transport and treatment of polymers and plastic powders, and in 1969 moved its main production plant to Santa Maria di Sala (Venice).
Between 1970 and 1980, the Group expanded gradually in both geographical distribution establishing its first foreign subsidiary Piovan Germania in 1974 - and its range of products and technologies. This came to include a complete range of machines used in the automation process for the storage, transport and processing of polymers and plastic powders, laying the foundations for future worldwide leadership. During the same period, the Company also launched its first line of refrigerators, and introduced the market's first centralized system for granule feeding, dosing and dehumidification.
This was also a time of significant production growth within the Group, which, from a generalist foundation, soon began to develop specific expertise in the application of plastics to the packaging, automotive, consumer and construction markets. This laid the groundwork for future specializations in customer industrial processes, and the consequent ability to offer innovative solutions. Anticipating future market trends, the Company also developed its first plant supervision and control software, which guarantees constant monitoring of machine operativity.
During the 1990's, the Group continued to grow globally and to improve its technological and qualitative expertise, gaining ISO 9001 certification and expanding its commercial and production capacities in overseas markets by opening new subsidiaries.
In the early 90s Nicola Piovan, Luigi Piovan's son, joined the company. He has been Chief Executive Officer since 2002 and Sole Director from 2011 to 2018. The Group continued its international expansion and established production plants outside Italy, specifically in Brazil and China. Additional foreign subsidiaries were soon opened in Mexico, Great Britain, Austria, Hungary, the Czech Republic, India, Turkey, Thailand, and Vietnam.
This expansion aimed to guarantee customers a global presence, providing constant, highquality service "close to the customer", to ensure that the complex machinery being sold worked flawlessly. It also ensured commercial presence in every relevant geographical area, allowing the Group to anticipate new market trends. As a result, continuous technological evolution, proximity to customers, high-quality service and sales, along with a focus on employees and their professional and personal growth, now form part of the Group's DNA.
In recent years the Group has developed the first solutions for the processing of recycled plastics, enabling the construction of hundreds of plants in the coming years and the development of the Group's technological leadership.
2007 saw the launch of the first version of the Group's proprietary software "Winfactory". Since then a new version has been released annually, leading to the current version "Winfactory 4.0", which still represents one of the Group's advantages over its main competitors.
Continuous investment in hi-tech solutions and energy saving processes have also contributed to attracting worldwide leaders in packaging, construction, basic commodities, and the food and automotive industries.
Piovan S.p.A. became publicly listed on the Milan stock exchange, within the Star segment, on October 19, 2018.
In October 2020, Doteco S.p.A., an Italian leader globally in technology for the dosing of plastic film and synthetic fibers, along with its U.S. subsidiary Doteco, Inc., joined Piovan Group.
In January 2022, Piovan S.p.A. completed the acquisition of the entirety of the share capital in Sewickley Capital Inc., owner of 100% of IPEG Inc. – an industry leader in North America – thereby further strengthening its global leadership in this industry.
In February 2024, Piovan S.p.A. acquired 1% of the share capital of NuVu - an Indian company of which Piovan already indirectly holds 50% through the subsidiary Conair Pacific Equipment PTE Ltd - from the selling shareholders of NuVu. As a result of this transaction, Piovan Group will collectively hold a 51% stake in NuVu, acquiring a controlling interest in the company and consolidating it within the group beginning in February 2024.
Today the Group comprises a network of direct or indirect subsidiaries of Piovan S.p.A., with sites in Europe, the United States and Asia, both thanks to organic growth dynamics and to acquisitions. The strategic, managerial and operational direction of the Group, which as of June 30, 2024, comprises 43 companies, including 13 production companies with 14 plants and 30 commercial companies, is entrusted directly to Piovan S.p.A.
The global reach of Piovan Group's companies creates a major competitive advantage, providing customers across its various markets with a uniform level of service quality, in addition to an extremely broad and constantly developing range of products. This range is a core feature of the Group's commercial offering, both for the processes of automated storage, transport and treatment of polymers, recycled plastics and bio-resins to every final sector, and for the transport and treatment of food powders and creams, which has recently become an area of development within the Group's range, thanks to the subsidiaries Penta S.r.l. and FEA Process & Technologica Plants S.r.l. ("FEA").
On October 22, 2019, Italy's President, Sergio Mattarella, honored Nicola Piovan with the title of Cavaliere del Lavoro (Italian knighthood for accomplishments in industry). This important recognition testifies to the commitment the Piovan family has dedicated to growing the business for more than 50 years.
Piovan Group structure at June 30, 2024
12
GROUP OVERVIEW
General economic overview
Early 2024 saw a gradual improvement in the global economy, mainly thanks to the better-thanexpected resilience of the major global markets. Inflation continued to decline (although slowly) as a result of the more restrictive monetary policies adopted by the main central banks and the reduction in energy commodity prices from last year's peaks.
The International Monetary Fund's (IMF) latest update on global growth forecasts no substantial changes from the previous projections outlined in the April 2024 World Economic Outlook (WEO). Global growth expectations stand at 3.2% for 2024 and 3.3% for 2025 respectively. The underlying dynamics of these expectations, however, varied across the regions considered.
Growth estimates for the advanced economies have, in fact, been revised downward, decreasing to 2.6% in 2024 (0.1% lower than forecast in April 2024) and 1.9% in 2025.
In line with the April 2024 forecast, moderate growth of 0.9% is expected in the Eurozone in 2024 (driven by the positive H1 performance in services and exports) and growth of 1.5% in 2025. This trend is supported by real wage increases and greater investment resulting from the easing of financial conditions as monetary policy is gradually loosened this year. The manufacturing sector, however, is still weak, which will likely slow down the recovery, especially in countries such as Germany.
In the emerging markets and developing countries, however, growth forecasts have been revised upward, driven by trends in China and India. Growth in China is forecast at 5% for 2024, mainly due to the recovery of private consumption and exports. In 2025, GDP growth is expected to decelerate to 4.5% and to continue to decline over the medium term, dropping to 3.3% in 2029 as a result of reduced productivity growth. Growth forecasts for India have also been revised upward, hitting 7% in 2024.
Nominal wage growth remains strong - above inflation in some countries - reflecting the pay negotiations that concluded in early 2024. With regard to interest rate cuts, many central banks in emerging markets remain cautious, being chiefly aware of the potential weakening of their countries' currencies against the dollar.
Against this macroeconomic backdrop, countries will be required to persevere in restoring price stability and to deal with the consequences of the recent crisis by recovering the lost ground. In the short term, this will require a careful combination of measures. In countries where the risk of inflation is high, central banks should refrain from easing too abruptly and remain open to further tightening if necessary. By contrast, in countries where inflation appears to have stabilized (indicating a return to stable prices), monetary policy should be loosened gradually.
In this environment, Piovan Group continues to operate through an organizational structure based on subsidiaries with production sites on different continents and a global network providing technical and commercial assistance across all the areas in which the Group operates.
The Group's goal is to have a presence in all relevant markets and, in particular, to open or reinforce facilities in markets that are expected to see growth. It is for this reason that the group has, even in this challenging macroeconomic landscape, managed to increase market share in order to mitigate the overall risk and benefit from possible improvements in certain areas/sectors.
Significant events in the first half of 2024
New facility in China
During January 2024, the Chinese subsidiary Piovan Plastic Machinery began the relocation of its manufacturing operations to a temporary site, located at No. 63 Xiangyang Road, Suzhou National High-tech Industrial Development Zone. The transfer was completed in March 2024. This temporary solution, was necessary as a result of the expiration of the lease of the premises occupied until now, and pending the completion of the construction of the new plant, located in No. 369 Tayuan Road, Suzhou National High-tech Industrial Development Zone. Once the construction of the new plant is completed, currently scheduled for the second half of 2024, Piovan Plastic Machinery will move its operations to the permanent site. This move has caused delays in some shipments and thus of billing, which were initially expected in H1 2024, but will now be postponed to H2 2024.
Consolidation of Group brands and refrigeration activities
On January 31, 2024, the Piovan Group announced the start of a process to simplify its brand architecture, the purpose of which is to develop the Group and strengthen the sense of belonging of the constituent brands, while respecting their history and identity, and to present itself with a single strong identity on the international market. Specifically, the brands "Fdm", "Fea", "Penta", and "UnaDyn" as of the announcement date became "Piovan Fdm", "Piovan Fea", "Piovan Penta", and "Piovan UnaDyn". The "Conair", "Doteco", "Pelletron" and "Thermal Care" brands will add "PiovanGroup" as an integral part of their logos. In addition, Energys will operate as Piovan, Progema will merge into Piovan Penta, and Republic Machine into Conair.
Finally, as of the date of the announcement, Aquatech will begin operating under the Thermal Care brand as part of a broader strategic initiative in industrial and process refrigeration resulting from the integration of the activities and products of the two companies. The Group expects this consolidation to lead to the creation of a global player in the segment, with a highlyspread production capacity ranging from North America to Latin America and from Europe to Asia, alongside a comprehensive service structure which ensures a closeness to the customer in all countries in which it has a presence and operates. The integration of these business units will allow for R&D efficiencies and an expanded portfolio of products, solutions and services capable of serving a wide range of market sectors.
Acquisition of a controlling stake in Nu-Vu Conair Private Ltd
On February 6, 2024, Piovan S.p.A. and Nu-Vu Conair Private Ltd. ("NuVu") announced the signing of an agreement stipulating the purchase by Piovan S.p.A. of 1% of the share capital of NuVu, an Indian company of which Piovan already indirectly holds 50% through the subsidiary Conair Pacific Equipment PTE Ltd, from the selling shareholders of NuVu. The acquisition was completed on February 14, 2024, following the satisfaction of all conditions set out under the agreement, and Piovan Group currently holds a controlling stake of 51% in NuVu.
Nu-Vu Conair Pvt. Ltd. was a joint venture between NuVu Engineers, Ahmedabad, India and The Conair Group (part of the Piovan Group), Pennsylvania, USA. The joint venture began in 2007, and Nu-Vu Conair Pvt. Ltd. is currently one of the leading manufacturers of polymer processing automation systems in India. The company employs about 250 people and operates a manufacturing plant with a total area of about 150,000 sq. ft. (currently being expanded by an additional 80,000 sq. ft.) for the production of centralized vacuum conveying systems, drying systems, gravimetric dosing systems, chillers and mold temperature control units, crystallizers, conveyor belts, granulators and other polymer processing machinery. Based on the results for 2023, NuVu reported revenue of approximately Euro 20.0 million, with adjusted EBITDA of approximately Euro 3.6 million.
Based on the pro-forma aggregate results1 for 2023, the combined Group, including NuVu, generated revenue of over € 590.5 million, with EBITDA of approximately € 82.0 million. The Transaction was funded through available cash.
Piovan S.p.A. - Tax Audit
As part of the ordinary control planned activities to which large taxpayers are normally subject, Piovan S.p.A. was the subject of a tax audit carried out by the Guardia di Finanza ("GdF") in relation to FY from 2017 to 2022.
The tax audit commenced on May 2, 2023, and ended on December 12, 2023, with the issuance of a tax audit report (so called Processo Verbale di Constatazione – "PVC") relating to the FYs 2017–2021 and, subsequently, on January 30, 2024, with the issuance of a PVC related to FY 2022.
The findings formulated in the PVC refer almost exclusively to the tax profile of the economic relationships in place with the Group subsidiaries both in Italy and foreign. In particular, the main dispute relates to the alleged failure to charge back costs incurred by the Company considered partially expressive of activities performed in favor of other companies in the group.
Following issuance of the PVC, the Agenzia delle Entrate ("Tax Authority") notified the Company with an invitation to appear, pursuant to art. 5 of Legislative Decree 218/97, with reference to FY 2017, which was followed by separate requests from the Company to access the pre-hearing compromise procedure ("Procedura di accertamento con adesione") for the subsequent years from 2018 to 2022, which were accepted by the Tax Authority for the years 2018, 2019, 2020 and 2021 with separate invitations to appear. This was aimed at instituting an interaction with the Tax Authority following the PVC issued by the GdF.
In the context of the above interaction, the Company believes to effectively have demonstrated how the financial performance of the foreign distribution companies – all operating in countries with ordinary taxation– are objectively contained within the benchmark range, quantified
1 Aggregate data not subject to audit or limited review
through suitable market analyses (the validity of which was confirmed by the GdF itself, in its PVC) and indeed are positioned around the average of market values.
In March 2024, due to the approaching expiring of the assessment deadlines, Piovan S.p.A. has received a Verbale di Accertamento – ("Tax Assessment Notice") with respect to FY 2017, which substantially reflected the findings already included in the PVC received at the end of 2023. Subsequently, on May 20, 2024, the Company filed its own appeal against the Tax Assessment Notice for 2017 with a request for an interim suspension and a public hearing before the Court of Tax Justice of Venice (the "Court"). On July 26, 2024, the same Court accepted the request for precautionary suspension promoted by the Company in relation to the Tax Assessment Notice for FY 2017, recognizing, in the Company's favor the so called, "fumus boni iuris" on multiple grounds and suspending the payment of approximately €2.4 million requested by the authorities on a provisional basis pending judgment, without the need to present any bank guarantee. The hearing for the next discussion on the merits has been set for October 25, 2024.
The Company,
- In consideration of the state of progress of the interaction with Tax Authority,
- considering as illegitimate the claim raised in the context of the notices received, also in light of the valid legal and economic reasons supporting its own actions, which allow to classify as not probable and currently not quantifiable, the risk of losing in a possible tax dispute against one or more assessment notices that should incorporate the findings of the PVC, as occurred with reference to FY 2017,
- supported by the opinion of leading independent primary consultants engaged for this purpose,
confirms at present that it does not deem necessary to accrue any provision for liabilities potentially connected to the findings raised, this assessment is further strengthened taking into consideration the favorable outcome of the request for precautionary suspension in relation to the Tax Assessment Notice for FY 2017.
Condenso: finalist at plastic recycling awards europe
In the first quarter of 2024, the Group continued pursuing our strategy of growth through products and solutions dedicated to recycling and the circular economy. In this regard, it should be noted that Condenso, an innovative technology of the Piovan Group, has been selected as a finalist in the "Recycling Machinery Innovation of the Year" category of the prestigious "Plastics Recycling Awards Europe 2024", a PRSE (Plastics Recycling Show Europe) event. Condenso is a product designed to condense Volatile Organic Compounds (VOCs) that are created during the production process where post-consumer plastics are used. This machinery makes it possible to obtain cleaner post-consumer polymers, such that they can be used up to 100% in the final product, even for demanding applications such as food applications - PET bottles - significantly contributing to carbon footprint reduction and environmental protection. This product allows
for savings of nearly 20% in energy, a reduction in CO2 emissions, and thus the greater overall sustainability of recycling processes. Condenso promotes sustainability as it contributes to carbon footprint containment and environmental and end-consumer protection.
For the Piovan Group, this is the second time in just a few years that it has achieved this prestigious milestone with its own patented technologies. This represents a further sign of the Group's strong innovative contribution and of the technology gap in the area of resin circularity and regeneration.
Payment of earnout related to the acquisition of the IPEG Group
On April 23, 2024, the Piovan Group settled the earnout established as part of the acquisition of the IPEG Group, for an amount of USD 21,802 thousand. It is recalled that this amount was immediately included in Financial liabilities and therefore already included in the calculation of the Group's net financial position. This amount corresponds to the maximum contractually stipulated value. For the payment of the earn-out, the Group utilized cash available for USD 10,000 thousand, and used USD 11,802 thousand from a loan in dollars stipulated by the parent company.
Shareholders' AGM of April 29, 2024
On April 29, 2024, the shareholders, at the AGM called to approve the 2023 Annual Accounts, also:
- approved the distribution of a dividend for Euro 13,803,891.75 (Euro 0.27 per share with profit rights, excluding the treasury shares of the Company).
- approved the purchase and disposal of treasury shares: the Shareholders' AGM conferred to the Board of Directors of the Company the authorization to purchase and make use of treasury shares with prior revocation of the previous authorization of the Shareholders' AGM of April 27, 2023, as detailed in the Directors' report published on the Company's website at www.piovan.com, in the Investors/Investor Relations/Shareholders' AGM section.
- appointed the new Board of Directors: with the conclusion of the mandate of the Board of Directors of the company, the Shareholders' AGM appointed the new Board of Directors, which shall remain in office for financial years 2024, 2025 and 2026, and whose number of members was set at 7, with the following composition:
- o Nicola Piovan Executive Chairman
- o Filippo Zuppichin Director
- o Marco Maria Fumagalli Independent Director
- o Manuela Grattoni Independent Director
- o Alessandra Bianchi Independent Director
- o Mario Cesari Independent Director
- o Antonella Lillo Independent Director
- appointed the new Board of Statutory Auditors: with the conclusion of the mandate also of the Board of Statutory Auditors of the company, the Shareholders' AGM appointed the new Board of Statutory Auditors, which shall remain in office for financial years 2024, 2025 and 2026.
The members of the Board of Statutory Auditors are:
- o Carmen Pezzuto Chairperson of the Board of Statutory Auditors
- o Luca Bassan Statutory Auditor
- o Diletta Selvaggia Elena Stendardi Statutory Auditor
- o Stefania Targa Alternate Auditor
- o Federica De Pieri Alternate Auditor
Group performance overview
Provided below are a number of metrics used in order to assess the Group's financial performance and standing. These metrics have been calculated as described in the 2023 Annual Report in the section "Alternative performance measures", with the exception of that outlined in the "Other information" section.
It should be noted that the income statement for the first half of 2024 includes the results of Nu-Vu Conair Pvt. Ltd. as of February 1, 2024, the date on which the acquisition of the control in NuVu was completed. In 2023, NuVu was considered a joint-venture and valued by the equity method. Therefore, 50% of the associate's H1 2023 result was included as a specific line item in the income statement.
| Changes | ||||||
|---|---|---|---|---|---|---|
| (amounts in €'000) | First half year 2024 (*) |
% on total revenues and other income |
First half year 2023 |
% on total revenues and other income |
2024 vs 2023 |
% |
| Revenues | 281,869 | 98.1% | 285,437 | 98.4% | (3,568) | (1.3%) |
| Other revenues and income | 5,583 | 1.9% | 4,695 | 1.6% | 888 | 18.9% |
| TOTAL REVENUE AND OTHER INCOME | 287,452 | 100.0% | 290,132 | 100.0% | (2,680) | (0.9%) |
| Adjusted EBITDA | 38,826 | 13.5% | 37,677 | 13.0% | 1,149 | 3.0% |
| EBITDA | 38,237 | 13.3% | 37,458 | 12.9% | 779 | 2.1% |
| OPERATING PROFIT | 30,624 | 10.7% | 30,572 | 10.5% | 52 | 0.2% |
| PROFIT BEFORE TAXES | 37,410 | 13.0% | 31,544 | 10.9% | 5,866 | 18.6% |
| Income taxes | 9,168 | 3.2% | 9,703 | 3.3% | (536) | (5.5%) |
| Adjusted NET PROFIT | 22,913 | 8.0% | 20,722 | 7.1% | 2,191 | 10.6% |
| NET PROFIT | 28,242 | 9.8% | 21,840 | 7.5% | 6,402 | 29.3% |
| Attributable to: | ||||||
| Owners of the parent | 27,618 | 9.6% | 22,610 | 7.8% | ||
| Non-controlling interests | 625 | 0.2% | (769) | (0.3%) | ||
| Basic earnings per share | 0.54 | 0.44 | ||||
| Diluted earnings per share | 0.53 | 0.44 | ||||
| Basic earnings per share - Adjusted | 0.44 | 0.42 | ||||
| Diluted earnings per share - Adjusted | 0.43 | 0.42 |
Economic performance of the Group
(*)NuVu has been included in the consolidation scope as of February 1, 2024.
Revenues
Piovan Group revenue in H1 2024 totaled Euro 281,869 thousand, a slight decrease on Euro 285,437 thousand in the first half of 2023 (-1.3%).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, H1 2024 revenues would have amounted to Euro 283,147 thousand, decreasing 0.8% on 2023.
At constant perimeter, excluding the revenues of NuVu, consolidated from February 1, 2024, H1 2024 Revenues would have amounted to Euro 273,906 thousand, decreasing 4.0% on H1 2023.
Revenues calculated at constant exchange rate (i.e. average exchange rate in H1 2023) would have increased by Euro 745 thousand to Euro 282,613 thousand, a reduction of 1% on the same period of 2023.
The exchange effect on revenue was mainly due to the fluctuations of the US dollar against the Euro and, to a lesser extent, to the Renminbi.
Revenues by market and geographical area
| €/000 | First half year 2024 (*) |
% | First half year 2023 |
% | Change | Change % |
|---|---|---|---|---|---|---|
| Technical Polymers | 214,012 | 75.9% | 223,531 | 78.3% | (9,519) | (4.3%) |
| Food & Industrial Application | 23,309 | 8.3% | 18,599 | 6.5% | 4,710 | 25.3% |
| Services | 44,548 | 15.8% | 43,307 | 15.2% | 1,241 | 2.9% |
| Revenues | 281,869 | 100.0% | 285,437 | 100.0% | (3,568) | (1.3%) |
The breakdown of revenue by market is as follows:
(*)NuVu has been included in the consolidation scope as of February 1, 2024.
Revenues by market in H1 2024 indicates:
- Technical Polymers systems revenue decreased by approximately 4.3%. The trend is an improvement on Q1 2024. In Q2, the Group recovered approximately 4% of revenues in this market. This reduction relates to the overall market, which from mid-2023, as a result of the relatively high interest rates, was generally weaker in most application sectors, with a greater impact on the consumer goods sector, which historically has been more cyclical, and construction.
As observed in Q1, recycling also declined, mainly in view of the European regulatory uncertainty, which led to a slowdown in order intake in the sector from the second half of 2023 until the completion of the legislation at the end of the first quarter of 2024.
By contrast, automotive sector revenues (approximately 10% of the total) are improving, and the fibers sector - which suffered a significant contraction in 2023 - is also recovering.
-
Food & Industrial Applications revenue however reports a 25.3% increase on H1 2023, reflecting the acceleration of development and production on a number of major projects. In particular, thanks to the intake of major project orders and the expansion of the customer base, the Food sector presents a historically high backlog, which is expected to translate into further improvements in the second half of the year.
-
the Services division reports a revenue increase of 2.9% on the same period of the previous year, maintaining the strong performances of 2023 and reflecting the benefits of the Group strategy focused on growing this segment.
The breakdown of revenues by geographical area is as follows:
| €/000 | First half year 2024 (*) |
% | First half year 2023 |
% | Change | Change % |
|---|---|---|---|---|---|---|
| EMEA | 93,227 | 33.1% | 94,127 | 33.0% | (900) | (1.0%) |
| ASIA | 32,622 | 11.6% | 32,637 | 11.4% | (15) | 0.0% |
| NORTH AMERICA | 147,455 | 52.3% | 148,814 | 52.1% | (1,359) | (0.9%) |
| SOUTH AMERICA | 8,565 | 3.0% | 9,859 | 3.5% | (1,294) | (13.1%) |
| Revenues | 281,869 | 100.0% | 285,437 | 100.0% | (3,568) | (1.3%) |
(*)NuVu has been included in the consolidation scope as of February 1, 2024.
Revenue reduced slightly across all geographical areas. There was a 1% decrease in EMEA, offsetting the decline reported in Q1 2024 (amounting to -10.6%). The business generally continues to see positive signals, with significantly increasing market share.
Revenue in North America decreased slightly on H1 2023, driven mainly by the performances of the Mexican subsidiaries and the strength of the automotive sector in this area.
The Asian market benefited from the consolidation of NuVu. On a like-for-like basis, a contraction is therefore reported due to the temporary transfer of the production plant in China, which resulted in the postponement of a number of shipments to the following quarter. The backlog in the region however remains satisfactory, and the Group expects the performance to partially recover in the second half of the year.
Finally, the South American market contracted 13.1% (-16.0% in Q1 2024), reflecting the general drop in demand.
Other revenues and income
Other revenue and income increased by approximately Euro 888 thousand on H1 2023.
Total revenues and other income
Piovan Group Total revenue and other income in H1 2024 totaled Euro 287,452 thousand, a slight reduction on Euro 290,132 thousand in the first half of 2023 (-0.9%).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, Total revenue and other income for H1 2024 would amount to Euro 288,752 thousand, decreasing 0.5% on the first half of 2023.
At constant perimeter, excluding the Total revenue and other income of NuVu, consolidated from February 1, 2024, Total revenue and other income for H1 2024 would amount to Euro 279,290 thousand, contracting 3.7% on the same period of the previous year.
Contribution margin
The contribution margin is calculated as the sum of: (+) Total revenue and income (-) Raw material purchases, components, goods and inventory changes and less variable production costs (external processing, transport costs, intermediation and commissions, as illustrated in Note [29] Services).
| €/000 | First half-year 2024 (*) |
First half year 2023 |
|---|---|---|
| Total revenues and other income | 287,452 | 290,132 |
| Costs of raw materials, components and goods and changes in inventories | 123,976 | 130,479 |
| Variable services expenses | 31,423 | 34,234 |
| Contribution margin | 132,053 | 125,419 |
| % on total revenues and other income | 45.9% | 43.2% |
(*)NuVu has been included in the consolidation scope as of February 1, 2024.
The contribution margin in the first half of 2024 was Euro 132,053 thousand, compared to Euro 125,419 thousand in 2023. The margin on total revenue and other income was 45.9% (43.2% in H1 2023 and 44.5% for the full year 2023).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, for 2024 the Piovan Group contribution margin would total Euro 132,523 thousand (+5.7% on the previous year).
At constant perimeter, excluding therefore the contribution of NuVu, this indicator totaled Euro 129,017 thousand (46.2% of total revenue and other income).
In 2023, the figure partly reflected the recognition of certain additional costs related to a contract in the Food Area for one of the subsidiaries.
Research and Development Costs
In the first half of 2024, the Piovan Group incurred research and development expenses amounting to Euro 11,185 thousand, 3.9% of Total revenue and other income (Euro 10,481 thousand in H1 2023, 3.6% of Total revenue and income. In H1 2024, Euro 10,433 thousand concerned personnel operating in R&D and engineering, entirely expensed to the statement of profit and loss, for the execution of complex and innovative projects (Euro 9,771 thousand in the first half of 2023). The scale of this commitment to investment in research and development is a clear demonstration of the Group's unwavering desire to position itself as a supplier of solutions, and not merely of machinery or systems. This desire has always set the Group apart and, over the years, has led to its position of market dominance. The Group is defined, in fact, by a range of products that are constantly being updated, thanks to research and development activity carried out in collaboration with its customers, an aspect which is of fundamental importance in the initial phase of the development of customer-specific solutions. The Group's competitive position is linked to constant improvement and investments in technology and processes.
EBITDA
EBITDA in H1 2024 totaled Euro 38,237 thousand, an increase of 2.1% compared to Euro 37,458 thousand in H1 2023 (13.3% margin vs. 12.9% in 2023 on Total revenue and other income).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, for 2024 Piovan Group EBITDA would total Euro 38,399 thousand (+2.5% on the previous year).
At constant perimeter, excluding therefore the contribution of NuVu, consolidated from February 1, 2024, the account for H1 2024 totaled Euro 36,893 thousand, slightly reducing by approximately 1.5% on the H1 2023. The EBITDA margin at like-for-like scope was 13.2%.
The improvement in EBITDA is due to the good margin on the orders executed in H1 and a reduction in raw material and service costs.
Adjusted EBITDA
This figure is calculated by excluding certain non-recurring items or non-core activities.
Adjusted EBITDA in H1 2024 totaled Euro 38,826 thousand, for a margin on total revenue and other income of 13.5% (+3.0% on H1 2023 Adj. EBITDA).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, Adjusted EBITDA in H1 2024 would have been Euro 38,988 thousand (+3.5% on H1 2023).
Adjusted EBITDA in H1 2024, excluding the contribution of NuVu, for a like-for-like comparison, comes to Euro 37,482 thousand, for a margin on total revenue of 13.4%, up on the Adj. EBITDA in H1 2023.
A reconciliation of EBITDA and adjusted EBITDA is shown in the table below:
| €/000 | First half-year 2024 |
First half year 2023 |
|---|---|---|
| EBITDA | 38,237 | 37,458 |
| Non-recurring items related to acquisitions, reorganisations and integration processes | 589 | 219 |
| Adj. EBITDA | 38,826 | 37,677 |
EBIT
EBIT in H1 2024 totaled Euro 30,624 thousand, up from Euro 30,572 thousand in H1 2023. The EBIT margin on total revenue and other income came to 10.7%, compared to 10.5% for the comparative period.
The EBIT result reflects the effects of the purchase price allocation ("PPA") of IPEG and the provisional PPA of NuVu, which led to the recognition of amortization of intangible assets of Euro 2,667 thousand in H1 2024 (Euro 1,953 thousand in H1 2023, which included the IPEG PPA only).
Excluding the effects of the PPA as described above, EBIT would have been Euro 33,291 thousand, for a margin on total revenues and other income of 11.6% (Euro 32,525 thousand in H1 2023 for a margin of 11.2% on total revenue and other income).
Recognizing the effect of the acquisition of NuVu retroactively to January 1, 2024, Adjusted EBIT in H1 2024 would have been Euro 30,786 thousand (+0.7% on H1 2023).
Excluding the contribution therefore of NuVu, consolidated from February 1, 2024, EBIT in H1 2024 amounted to Euro 30,072 thousand, slightly decreasing 1.6% on the previous year. As described above, EBIT reflects certain non-recurring costs incurred in the first half-year for activities related to integrating the Group, acquisition and reorganization process.
Profit for the period
The net profit in H1 2024 of Euro 28,242 thousand increased on Euro 21,840 thousand in H1 2023. The margin on total revenue and other income was 9.8% (7.5% in H1 2023).
Net profit in H1 2023 benefited from the gain on the sale of Toba PNC. In the first half of 2024, the Group benefited from income of Euro 6,393 thousand from the revaluation at fair value of the holding initially undertaken in NuVu (50%), which subsequently entered the consolidation scope.
Excluding the amortization relating to the IPEG PPA and the provisional NuVu PPA, in the amount of Euro 2,667 thousand (Euro 1,953 thousand in H1 2023, which included IPEG only), the related tax effect of Euro 572 thousand (Euro 436 thousand in H1 2023), net profit for the period would be Euro 30,337 thousand (Euro 23,357 thousand in H1 2023), for a margin on total revenue and other income of 10.6% (8.1% in H1 2023).
In the February-June 2024 period, NuVu reported a net profit of Euro 1,034 thousand, which reduces to Euro 499 thousand if including the PPA effects.
Adjusted profit for the period
This measure was introduced in 2024 and is calculated by excluding certain non-recurring items or non-core activities from the profit for the period.
The Adjusted Profit for H1 2024 totaled Euro 22,913 thousand, for a margin on total revenue and other income of 8.0%. This indicator in H1 2023 would have amounted to Euro 20,722 thousand, with a margin on total revenue and other income of 7.1%.
A reconciliation of the Profit and the Adjusted Profit is presented in the table below:
| €/000 | First half year 2024 |
First half year 2023 |
|---|---|---|
| NET PROFIT | 28,242 | 21,840 |
| Non-recurring expenses/incomes included in EBITDA | 589 | 219 |
| Income from acquisition of NuVu's control (revaluation at fair value of previously held interest) | (6,393) | - |
| NuVu consolidation's exchange effect | 475 | - |
| Income from the sale of Toba | - | (1,337) |
| ADJUSTED NET PROFIT | 22,913 | 20,722 |
Basic and diluted earnings per share
Basic and diluted earnings per share came to Euro 0.54 and Euro 0.53 respectively in H1 2024 (Euro 0.44 and Euro 0.44 respectively in H1 2023).
Adjusted earnings per share and adjusted diluted earnings per share were determined starting from the adjusted earnings, from which minority interests were subtracted, and dividing by the weighted average number of shares in circulation. For H1 2024, adjusted basic and adjusted diluted earnings per share came to Euro 0.44 and 0.43 respectively (both were 0.42 in H1 2023).
Financial performance of the Group
The financial structure of the Piovan Group as at June 30, 2024 is summarized below, compared with December 31, 2023, and where considered significant, with June 30, 2023.
Group net financial position
We present below the Net Financial Position (NFP) as required by the Consob Call for Attention No. 5/21 of April 29, 2021, which implements the EMSA Guidelines 32-382-1138 of March 4, 2021.
| €/000 | 30.06.2024 | 31.12.2023 | 30.06.2023 |
|---|---|---|---|
| A. Cash | 63,586 | 79,285 | 52,678 |
| B. Cash equivalents | 12,330 | 13,500 | 14,500 |
| C. Other current financial assets | - | 6,556 | 6,599 |
| D. Liquidity (A+B+C) | 75,916 | 99,341 | 73,777 |
| E. Current financial debt (including debt instruments, but excluding current portion of non-current financial debt) |
(5,674) | (23,906) | (23,747) |
| F. Current portion of non-current financial debt | (35,967) | (36,567) | (38,258) |
| G. Current financial indebtedness (E+F) | (41,641) | (60,473) | (62,005) |
| H. Net current financial indebtedness (G-D) | 34,275 | 38,868 | 11,772 |
| I. Non-current financial debt (excluding current portion and debt instruments) |
(90,350) | (94,121) | (112,022) |
| J. Debt instruments | - | - | - |
| K. Non-current trade and other payables | (816) | (2,500) | (2,328) |
| L. Non-current financial indebtedness (I+J+K) | (91,166) | (96,621) | (114,350) |
| M. Total net financial position (H+L) | (56,891) | (57,753) | (102,578) |
The following is information related to indirect debt and/or debt subject to conditions that are not reflected above but which is required by the ESMA document:
-
regarding provisions, see Note [18] – Employee benefit plans and Note [19] – Provisions for risks and charges, which include sums of this type;
-
regarding bank guarantees, see the section "Commitments and Risks" in the Notes;
- the Company has also recognized liabilities for options granted to non-controlling interests in the amount of Euro 26,174 thousand (see Note [20]);
- commitments related to lease agreements that are not recognized as liabilities in accordance with IFRS 16 total approximately Euro 4,402 thousand;
"Current financial debt (including debt instruments, but excluding the current portion of the non-current financial debt)" at December 31, 2023 included the fair value of the earnout of USD 21,802 thousand and corresponds to the maximum contractual value, which was settled at the end of April 2024, based on the contractual agreements. For the payment of the earn-out, cash available to the Group of USD 10,000 thousand was utilized, and for USD 11,802 thousand the loan in dollars utilized in April 2024 by the parent company.
The Group's net financial position at June 30, 2024 was a debt position of Euro 56,891 thousand (improving over the net debt position of Euro 102,578 thousand at June 30, 2023), and
improving compared to net debt of Euro 57,753 thousand at December 31, 2023, despite dividend payments of approximately Euro 13,804 thousand and investments of approx. Euro 5,483 thousand in H1 2024.
Excluding the effects of IFRS 16, the Group's net financial position at June 30, 2024 was a debt of Euro 38,468 thousand, compared to Euro 40,455 thousand at December 31, 2023, with a net cash generation of Euro 1,987 thousand.
Investments for the period totaled Euro 5,483 thousand (Euro 4,522 thousand in H1 2023 and Euro 9,721 thousand in 2023 as a whole).
Financial debt includes medium/long-term loans, mainly relating to the Parent Company and entirely in Euro, for Euro 111,069 thousand, of which Euro 35,967 thousand repayable within 12 months and the remaining Euro 75,102 thousand long-term.
These loans include:
- a loan signed in January 2022 to finalize the acquisition of the IPEG group, the residual value of which is Euro 75,000 thousand at June 30, 2024. This loan had an original value of Euro 100 million, a six-year term and an interest rate of 1.335%.
- a loan signed in April 2024 for USD 15,000 thousand (Euro 14,012 thousand), used partly for the earnout payment as explained in greater detail above. This loan matures at 63 months and is repayable in semi-annual instalments with a constant principal amount.
Both of these loans calls for the Group to meet a series of financial and non-financial covenants in line with market practice, particularly in relation to the debt-to-EBITDA and debt-to-equity ratios (as defined in the related agreement). These parameters are tested on a semi-annual basis. At June 30, 2024, Group performance was amply within the covenants.
Net invested capital
Net non-current assets represented by property, plant and equipment, right-of-use assets, intangible assets, equity investments, deferred tax assets and other non-current assets at June 30, 2024 amounted to Euro 236,962 thousand, increasing on December 31, 2023 (Euro 211,826 thousand), due to the effect of the NuVu PPA ( for further details make reference to paragraph "Acquisition of NuVu") and the investments made in H2, offset by depreciation in the period.
| €/000 | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Property, plant and equipment | 58,516 | 50,887 |
| Right of Use (IFRS 16 - Lease) | 17,760 | 16,715 |
| Intangible assets | 146,503 | 120,315 |
| Equity investments | 1,322 | 11,426 |
| Other non-current assets | 618 | 570 |
| Deferred tax assets | 12,243 | 11,913 |
| Net invested capital | 236,962 | 211,826 |
Investments
Total investments for the period under review came to Euro 5,483 thousand (Euro 4,522 thousand in H1 2023 and Euro 9,721 thousand in 2023). Non-recurring investments amounted to Euro 3,829 thousand (Euro 2,604 thousand in H1 2023 and Euro 5,419 thousand in 2023), or 1.3% of Total revenue and other income. These mainly concern: (i) investments for the construction of the new factory in China; (ii) a residual portion of the project to expand the production structure of the subsidiary FEA, initiated in 2023 and with completion scheduled for 2024; (iii) the investments in the construction of a new factory in India by NuVu, still working in progress.
Net trade capital and net working capital
| €/000 | 30.06.2024 | 31.12.2023 | 30.06.2023 |
|---|---|---|---|
| Trade receivables | 77,960 | 79,979 | 88,959 |
| Inventories | 86,270 | 85,341 | 88,653 |
| Contract assets for work in progress | 12,687 | 8,828 | 8,954 |
| Trade payables | (64,977) | (71,668) | (67,763) |
| Advance from customers | (30,668) | (37,445) | (36,019) |
| Contract liabilities for work in progress | (5,249) | (4,748) | (4,197) |
| Net trade capital | 76,023 | 60,287 | 78,587 |
| Tax receivables | 6,219 | 6,267 | 7,586 |
| Other current assets | 14,177 | 13,163 | 12,594 |
| Tax liabilities and social security contributions | (12,014) | (11,388) | (10,370) |
| Other current liabilities | (32,146) | (27,122) | (26,772) |
| Net working capital | 52,259 | 41,207 | 61,625 |
Net working capital for the period ended June 30, 2024, was as follows:
Net working capital increased on December 31, 2023. The increase is attributable for Euro 1,666 thousand to the consolidation of NuVu, while the remaining portion mainly relates to the progress of some significant projects recognized in their current state, the reduction in trade payables related to the timing of payments and the decrease in advances from customers, linked to the development of the order book.
Medium/long term liabilities
| €/000 | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Employee benefits plans | 5,519 | 5,635 |
| Provision for risks and charges | 5,432 | 5,486 |
| Other non-current liabilities | 816 | 2,500 |
| Deferred tax liabilities | 15,779 | 12,822 |
| Net non-current liabilities | 27,546 | 26,443 |
At June 30, 2024, medium/long-term liabilities increased, mainly due to the increase in deferred tax liabilities following the provisional NuVu PPA, netted by the reclassification from non-current to current of payables for employee incentive plans.
Cash conversion
The cash conversion index is calculated as EBITDA Adjusted last twelve months less recurring investments in the last twelve months as a percentage of EBITDA Adjusted last twelve months. For the first half of 2024, it was 95.0% (94.6% for the first half of 2023).
Principal risks and uncertainties to which the Group is exposed
The Group's activities are exposed to a series of financial and operating risks that could affect its equity and financial position, the result for the period and cash flows through the related impact on financial instruments in place.
Overall responsibility for the creation and supervision of the Group's financial and operating risk management system lies with the Board of Directors. The various organization units functionally responsible for the operational management of each type of risk report to the Board of Directors.
Under guidelines issued by the Board of Director and for each specific risk, these units define the tools and techniques to cover the risks and/or transfer them to third parties (insurance) and evaluate risks neither covered nor insured.
For an analysis on the risks to which the Group is exposed, reference should be made to the Annual Financial Report at December 31, 2023, as there have been no changes in the first semester 2024.
Subsequent events after June 30, 2024
Sale of the controlling interest in Piovan S.p.A. by Pentafin S.p.A.
On July 19, 2024, Automation Systems S.p.A. (the "Purchaser"), a company independently managed and whose share capital is indirectly owned by Investindustrial VIII SCSp ("Investindustrial VIII" or the "Fund VIII"), has entered into a sale and purchase agreement (the "Sale and Purchase Agreement") with Pentafin S.p.A. ("Pentafin"), for the purchase of a shareholding representing 58.35% of the share capital of Piovan, corresponding to 61.17% of the share capital of Piovan excluding n. 2,474,475 Treasury Shares.
The price per share bought and sold is Euro 14.00 (cum dividendo) and implies a market capitalization for the Company of approximately Euro 716 million. In particular, the "Sale and Purchase Agreement" provides that the Buyer purchases from Pentafin n. 31,275,541 ordinary shares of Piovan (the "Sale and Purchase Agreement"), therefore the overall consideration for the Sale and Purchase is equal to approximately €438 million, which will be paid by the Buyer to Pentafin in a single payment upon execution of the Sale and Purchase (the "Closing").
The Closing is subject to the conditions precedent of obtaining, by the end of the ninth month from July 19th 2024, the authorisations required by the competent antitrust authorities as well as the authorisations concerning the control on foreign investments (the so-called golden power).
It is expected that the conditions precedent may be fulfilled by October 15, 2024 and that the Closing of the Sale and Purchase may take place in the following weeks.
On July 19th 2024, Automation Systems Collective S.C.A., a company indirectly owned by Fund VIII, and Pentafin have entered into an investment agreement regulating, among other things, the re-investment commitments at the Closing by Pentafin in the holding company that indirectly holds 100% of the share capital of the Purchaser (the "Investment Agreement"). Under the terms of the Investment Agreement, it is provided that at the Closing: (i) Pentafin shall become the owner of an indirect shareholding in the Purchaser, representing 25% of the share capital; and (ii) the parties shall enter into a shareholders' agreement (the "Shareholders' Agreement") aimed at regulating, in accordance with market practice, the corporate governance of Piovan and the transfer of the relevant shareholdings. In particular, the Shareholders' Agreement provides, among other terms and conditions, that after the Closing, Mr. Nicola Piovan shall continue to serve as Executive Chairman of the Board of Directors and that Mr. Filippo Zuppichin be reappointed as Chief Executive Officer of the Company. An extract of the Shareholders' Agreement has been published on the Company's website as well as the competent press sources, in the manner prescribed by law.
Following the Closing, pursuant to section 106 of the Testo Unico della Finanza ("TUF"), the Purchaser shall be required to launch a mandatory tender offer for all of the remaining Piovan's shares at a price of Euro 14,00 per share (i.e. corresponding to the price of the Sale and Purchase), aimed at delisting Piovan's shares from Euronext Star Milan.
Furthermore, on July 19, 2024, the Purchaser has entered into a sale and purchase agreement with 7-Industries Holding B.V. for the purchase of no. 3,467,698 ordinary shares of Piovan, representing 6.47% of the share capital of Piovan, corresponding to 6.78% of the share capital excluding the n. 2,474,475 treasury shares. The price for each share purchased is equal to € 14,00 (i.e. at the same price of the Sale and Purchase with Pentafin). The closing of the sale and purchase with 7-Industries is subject to the execution of the Closing of the Sale and Purchase with Pentafin.
Share capital increase in Fea
On July 25, 2024, a shareholders' meeting of FEA was held to discuss the provisions pursuant to Article 2482-ter of the Civil Code. The shareholder's meeting promoted a capital increase designed to restore equilibrium to the company's balance sheet, covering past losses and reconstituting the share capital to levels that meet the legal limit. This capital increase was fully subscribed by Piovan S.p.A., which participated through a payment of Euro 3,500 thousand. As a result, Piovan S.p.A. holds 100% of the shares of FEA.
Piovan S.p.A. - Tax audit - outcome of the request for interim suspension
As described in the section Significant events in the first half of 2024, on July 26, 2024, the Court of Tax Justice of Venice accepted the request for precautionary suspension promoted by the Company in relation to the Tax Assessment Notice for FY 2017, recognizing, in the Company's favor the so called, "fumus boni iuris" (sufficient legal basis) on multiple grounds and suspending the payment requested by the authorities on a provisional basis pending judgment, without the need to present any bank guarantee. The hearing for the next discussion on the merits has been set for October 25, 2024.
Resignation of the Board of Directors, with effectiveness subject to the completion of the purchase and sale transaction between Automation Systems S.p.A. and Pentafin S.p.A. of the controlling interest in Piovan S.p.A.
On 31 July 2024, following the information provided to the market on 19 July 2024 regarding the operation described in the paragraph " Sale of the controlling interest holding in Piovan S.p.A. by Pentafin S.p.A.", the current members of the Company's Board of Directors - Nicola Piovan, Filippo Zuppichin, Marco Maria Fumagalli, Manuela Grattoni, Alessandra Bianchi, Mario Cesari and Antonella Lillo - have communicated their resignation, with effect from the execution of the Sale and Purchase operation described in the paragraph mentioned above. The purpose of the resignations is to allow the appointment of a new administrative body that reflects the future control structure of the Company. As communicated to the market on 19 July 2024 and 31 July 2024, following the execution of the transaction, Nicola Piovan and Filippo Zuppichin are expected to continue to hold the roles of Executive Chairman and Chief Executive Officer of the Company respectively.
The Board of Directors held today therefore gave a mandate to the Executive President to convene the Shareholders' Meeting at the times deemed appropriate. The call notice of the Shareholders' meeting and the related documentation will be published within the terms and according to the methods established by current legislation.
No other events subsequent to June 30, 2024 are reported.
Outlook
The Group confirms its focus on continuing on the strategic path undertaken and on boosting its contribution to the circular economy by developing products and solutions for the recycled value chain, increasing acquisitions, and working to achieve greater market share in the Food & Industrial Applications segment.
In terms of acquisition-led growth, in February 2024 the Group acquired 1% of NuVu Conair, thereby coming to hold 51% of the Indian company and acquiring control.
Piovan Group continues to remain interested in companies with products/technologies that can expand the value chain served by the Group, and we will continue to assess potential opportunities for acquisitions and external growth, both in the recycling and Food areas.
Furthermore, the integration of the IPEG Group continues, whose benefits are beginning to emerge in terms of the generation of commercial and cost synergies.
With regards to development in European legislation concerning the production and use of plastics, following months of uncertainty that have stifled the European polymer recycling market, the new regulations appear to be favorable both, where possible, to the reuse of items - but particularly to the recycling of plastics by setting ambitious targets for the coming years that should favor this segment.
It should also be noted that new regulations permitting the use of recycled plastic in food packaging are being approved in both India and China, supporting therefore the likely expansion of the Asian markets over the coming years.
These new regulations being approved in various countries represent an opportunity for Piovan Group. The Group, in fact, has over recent years developed technologies focused on the automation, processing and screening of recycled and compostable plastics, developing a strong leadership position also thanks to various patents related to the topic of recycling and thus achieving an advantageous position from a technological point of view. The Company currently estimates, including five months of NuVu, that in the preceding 12 months, approximately 25.6% of the automations sold in the packaging, fiber and recycling segments were utilized in order to make use of recycled material. Incentivizing the reuse of plastic items, although representing a minimal potential market share, can also give rise to significant investment in order to develop items whose technical complexity enables their reuse.
Since 2006, the Group has contributed to building of hundreds of plastic recycling plant and thousands of systems that make it possible to create new products out of recycled plastic.
Piovan is already engaged at various levels in the process of change and is committed to providing solutions to the market for a circular economy, particularly in researching and developing advanced innovative technologies - allowing customers to use recycled polymers and obtaining a quality product with low environmental impact, cutting CO2 emissions and the consumption of scarce resources.
In terms of organic growth, 2023 was again a record year both in terms of revenue and profitability growth.
Although the market has contracted substantially compared to the initial part of 2023, the performance in H1 2024, although declining slightly, is still very positive and reports good results - particularly in terms of profitability, benefiting from the increase in market share and the evergreater integration with the acquired companies.
In terms of order intake, Q1 2024 saw a continuation of the phase of market uncertainty already noticed in the final part of 2023, while Q2 2024 witnessed a significant recovery in order intake, which made it possible to close the gap reported for Q1 2024. This is despite the continuation of a macroeconomic and geopolitical environment which continues to reflect a general contraction in investment, as impacted by the ongoing Russia-Ukraine war, the recent rekindling of tensions in the Middle East, and particularly, the continued levels of high inflation that do not yet allow for an interest rate correction by the central banks.
Orders at June 30, 2024 are therefore up slightly on the same period of the previous year. The order backlog remains relatively stable against December 31, 2023 and is in any case above the Group's historic averages.
A Piovan Group strength has always been the fact that it can rely on a number of geographic areas and highly diversified sectors, with the Group in 2024 in fact intending to boost investment in the highest growth potential areas.
As noted in the section "Subsequent events after June 30, 2024", on July 19, 2024, a preliminary agreement was signed between Pentafin S.p.A. and Investindustrial for the disposal of the controlling holding of the Piovan Group.
Over the past few years, the Piovan Group has effectively consolidated its position as one of the leading global players in developing and producing manufacturing process automation systems. If the closing is achieved, it would begin a new chapter in the story of the Piovan Group, which will be written together with Investindustrial, a company with which it shares a vision, its values, and a focus on sustainability. In an ever-changing market environment, Investindustrial's expertise and resources will be crucial in continuing and accelerating growth for the benefit of all stakeholders. The chief objective will be to consolidate the Group's industry leadership and strengthen its international positioning, entering new markets and application segments.
Other information
Human resources
During the first half of 2024, the Group employed an average of 2,053 people, compared to 1,795 in the first half of 2023. The increase is mainly attributable to the inclusion of NuVu into the Group perimeter.
The distribution of operating personnel by category was as follows:
| First half-year 2024 | First half-year 2023 | ||||
|---|---|---|---|---|---|
| period end | average | period end | average | ||
| Executives | 77 | 78 | 42 | 41 | |
| Middle Managers | 143 | 139 | 116 | 115 | |
| White collars | 1,172 | 1,165 | 1,040 | 1,038 | |
| Blue collars | 663 | 672 | 595 | 602 | |
| Total | 2,055 | 2,053 | 1,793 | 1,795 |
Transactions with parent companies, subsidiaries and associated companies
There were numerous inter-company transactions carried out in the ordinary course of business and at normal market conditions.
Inter-company transactions are inherent in the organization structure of the Group. These relationships concern both commercial activities (subsidiaries of Piovan S.p.A. and established in various countries which distribute the products of the Group as agents or as distributors), and production activities (subsidiaries of Piovan S.p.A. which, producing certain types of systems, supplement the Piovan S.p.A. product range or offering the same range to clients selling or acquiring machines to or from Piovan S.p.A.), as well as participation in the national tax consolidation by the Italian companies Piovan S.p.A., Aquatech S.r.l. and Penta S.r.l. with the parent company Pentafin S.p.A.
There are also financial transactions between the companies belonging to the Group, which are also carried out in the normal course of business and at normal market conditions, while there are no transactions that can be considered atypical.
For further information, reference should be made to the comments in the Explanatory Notes to the Consolidated Financial Statements at paragraph "Other information".
Related party transactions
The "Regulation containing the provisions concerning related party transactions", adopted by Consob with motion No. 17221 of March 12, 2010, amended with motion No. 17389 of June 23, 2010 and Consob motion 21624 of December 10, 2022, enacted Article 2391-bis of the Civil Code.
On June 23, 2021, the Board of Directors passed a resolution to approve the revised RPT Policy in order to adapt it to the latest RPT Rules, as most recently amended.
The identification of transactions with related parties is undertaken in accordance with the afore-mentioned Consob regulation.
The company, in addition to the inter-company transactions commented upon above, also undertakes transactions with other related parties principally relating to persons that exercise administration and management functions in Piovan S.p.A., or entities controlled by such parties. These mainly concern commercial transactions and are carried out as part of the ordinary operations and at normal market conditions, as well as participation in the tax consolidation with the parent company Pentafin S.p.A.
Transactions with related parties are commented upon in the Other information section of the Explanatory Notes, to which reference should be made for further information.
Atypical and/or unusual transactions
There were no significant atypical and/or unusual transactions concerning the Parent Company Piovan S.p.A. or the Piovan Group in the first half of 2024.
Treasury shares or parent company shares in portfolio
Pursuant to Article 2428, paragraphs No. 2, No. 3 and No. 4 of the Civil Code, we report that the company holds at June 30, 2024 2,474,475 treasury shares, for a total value of Euro 3,012 thousand, recorded in the financial statements as a reduction of net equity under the account Treasury shares in portfolio reserve. No other company in the Group holds treasury shares or shares of the parent company.
With regard to shares issued, there are no limitations on voting rights, and no securities exist to which special control rights or special powers attach.
The environment and personnel
The Group carries out work with no potential negative impact on the region and the environment. It always, however, seeks to operate in accordance with best practices, working towards risk prevention and the reduction and minimization of its environmental impact. The Piovan Group also places great importance on the safety of its workers, and is committed to spreading the culture of safety within the Group and the various local organizations.
Off-balance sheet agreements
With regards to the information required by Article 2427, paragraph 1 No. 9 of the Civil Code, it is stated that the Group does not have Off-balance sheet agreements, with the exception of that indicated in the Explanatory Notes.
Group and consolidated tax procedure
The companies Piovan S.p.A., Penta S.r.l. and Aquatech S.r.l. as consolidated companies adhered to the Group taxation procedures in accordance with the option exercised by Pentafin S.p.A. as consolidating company for the three-year period 2024-2026, as per Articles 117 and 129 of the Presidential Decree 917/1986.
In preparing the financial statements of these companies, the effects of the transfer of the tax positions due to the consolidated tax accounts were taken into account; in particular, the subsequent accounts receivable from/payable to the consolidating company were recognized.
Alternative performance measures
In this Directors' Report, various alternative performance measures or intermediary earnings measures are presented in order to permit a better assessment of operating performance and financial position. These measures, however, are not identified as an accounting measure within IFRS and therefore the criterion for their determination may not be uniform with other groups or companies. Reference should be made to the "Annual Financial Report at December 31, 2023" which outlines the criteria used to construct these measures, with the exception of those illustrated below.
In 2024, it was decided to supplement the alternative performance measures monitored by the Group with the Adjusted Profit, which compared to the Group's Reported Profit is adjusted for non-core/one-off costs, which may include:
- a) costs for the restructuring and integration of consolidated companies and the offsetting of any provisions for restructuring and integration costs;
- b) disposal of non-current assets;
- disposals of assets related to discontinued operations;
- transaction costs, fees and expenses incurred by Group companies for negotiations of acquisitions in progress or completed in the period, including taxes, notary costs, and contract registration costs.
- c) other income/expenses related to changes in the consolidation scope.
CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AS AT AND FOR THE SIX MONTHS ENDED JUNE 30, 2024
Consolidated financial statements at June 30, 2024
Consolidated statement of financial position
(euro/thousand)
| ASSETS | Note | 30.06.2024 | of which related parties |
31.12.2023 | of which related parties |
|---|---|---|---|---|---|
| "Other information" |
"Other information" |
||||
| NON-CURRENT ASSETS | |||||
| Property, plant and equipment | Note 1 | 58,516 | 50,887 | ||
| Right of Use | Note 2 | 17,760 | 131 | 16,715 | 168 |
| Intangible assets | Note 3 | 146,503 | 120,315 | ||
| Equity investments | Note 4 | 1,322 | 11,426 | ||
| Other non-current assets | Note 5 | 618 | 570 | ||
| Deferred tax assets | Note 6 | 12,243 | 11,913 | ||
| TOTAL NON-CURRENT ASSETS | 236,962 | 211,826 | |||
| CURRENT ASSETS | |||||
| Inventories | Note 7 | 86,270 | 85,341 | ||
| Contract assets for work in progress | Note 8 | 12,687 | 8,828 | ||
| Trade receivables | Note 9 | 77,960 | 4 | 79,979 | 199 |
| Current financial assets | Note 10 | - | 6,556 | ||
| Tax receivables | Note 11 | 6,219 | 6,267 | ||
| Other current assets | Note 12 | 14,177 | 9 | 13,163 | 11 |
| Cash and cash equivalents | Note 13 | 75,916 | 92,785 | ||
| TOTAL CURRENT ASSETS | 273,229 | 292,919 | |||
| TOTAL ASSETS | 510,191 | 504,745 |
| LIABILITIES AND EQUITY | Note | 30.06.2024 | di cui parti correlate |
31.12.2023 di cui parti | correlate |
|---|---|---|---|---|---|
| EQUITY | |||||
| Share capital | Note 14 | 6,000 | 6,000 | ||
| Legal reserve | Note 14 | 1,200 | 1,200 | ||
| Reserve for own shares in portfolio | Note 14 | (3,012) | (2,489) | ||
| Translation reserve | Note 14 | 3,269 | 14 | ||
| Other Reserves and retained earnings | Note 14 | 124,561 | 114,612 | ||
| Net profit (loss) | Note 14 | 27,618 | 49,400 | ||
| Equity attributable to the owners of the parent | 159,636 | 168,737 | |||
| Equity attributable to non-controlling interests | Note 15 | 19,790 | 2,600 | ||
| TOTAL EQUITY | 179,426 | 171,337 | |||
| NON-CURRENT LIABILITIES | |||||
| Long-term loans | Note 17 | 75,102 | 79,624 | ||
| Non-current financial liabilities | Note 17 | 15,248 | 93 | 14,497 | 118 |
| Employee benefits plans | Note 18 | 5,519 | 5,635 | ||
| Provision for risks and charges | Note 19 | 5,432 | 5,486 | ||
| Non-current liabilities for options granted to non-controlling | Note 20 | 26,174 | - | ||
| interest | |||||
| Other non-current liabilities | Note 21 | 816 | - | 2,500 | 364 |
| Deferred tax liabilities | Note 6 | 15,779 | 12,822 | ||
| TOTAL NON-CURRENT LIABILITIES | 144,070 | 120,564 | |||
| CURRENT LIABILITIES | |||||
| Current portion of long-term loans | Note 17 | 35,967 | 36,567 | ||
| Current bank loans and borrowings | Note 17 | 1,589 | 666 | ||
| Current financial liabilities | Note 17 | 4,085 | 55 | 23,240 | 61 |
| Trade payables | Note 22 | 64,977 | 424 | 71,668 | 608 |
| Advance from customers | Note 23 | 30,668 | 4 | 37,445 | |
| Contract liabilities for work in progress | Note 8 | 5,249 | 4,748 | ||
| Current liabilities for options granted to non-controlling | |||||
| interests | Note 20 | - | - | ||
| Tax liabilities and social security contributions | Note 24 | 12,014 | 11,388 | ||
| Other current liabilities | Note 25 | 32,146 | 4,225 | 27,122 | 1,127 |
| TOTAL CURRENT LIABILITIES | 186,695 | 212,844 | |||
| TOTAL LIABILITIES | 330,765 | 333,408 | |||
| TOTAL LIABILITIES AND EQUITY | 510,191 | 504,745 |
Consolidated statement of profit and loss
| (euro/thousand) | |||||
|---|---|---|---|---|---|
| CONSOLIDATED STATEMENT OF PROFIT AND LOSS | Notes | 30.06.2024 | of which related parties |
30.06.2023 | of which related parties |
| "Other information" |
"Other information" |
||||
| Revenues | Note 26 | 281,869 | 41 | 285,437 | 21 |
| Other revenues and income | Note 27 | 5,583 | 4,695 | ||
| TOTAL REVENUES AND OTHER INCOME | 287,452 | 290,132 | |||
| Costs of raw materials, components and goods and changes in inventories |
Note 28 | 123,976 | 1,118 | 130,479 | 1,302 |
| Services | Note 29 | 53,695 | 729 | 53,905 | 717 |
| Personnel expenses | Note 30 | 69,816 | 807 | 65,989 | 552 |
| Other expenses | Note 31 | 1,728 | 2,301 | ||
| Amortisation and depreciation | Note 32 | 7,613 | 37 | 6,886 | 37 |
| TOTAL COSTS | 256,828 | 259,560 | |||
| OPERATING PROFIT | 30,624 | 30,572 | |||
| Financial income | Note 33 | 1,314 | 883 | ||
| Financial Expenses | Note 33 | (1,776) | (5) | (1,746) | (1) |
| Net exchange rate gain (losses) | Note 34 | 457 | (639) | ||
| Gains (losses) on liabilities for option granted to non controlling interests |
Note 35 | - | - | ||
| Profits (losses) from equity investments carried at equity | Note 36 | 6,792 | 1,136 | ||
| Profits (losses) from disposals | Note 37 | - | 1,337 | ||
| PROFIT BEFORE TAXES | 37,410 | 31,544 | |||
| Income taxes | Note 38 | 9,168 | 9,703 | ||
| NET PROFIT | 28,242 | 21,840 | |||
| ATTRIBUTABLE TO: | |||||
| Owners of the parent | 27,618 | 22,610 | |||
| Non-controlling interests | 625 | (769) | |||
| Earnings per share | |||||
| Basic earnings per share (in Euros) | Note 16 | 0.54 | 0.44 | ||
| Diluted earnings per share (in Euros) | Note 16 | 0.53 | 0.44 |
Consolidated statement of comprehensive income
| (euro/thousand) | ||
|---|---|---|
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | 30.06.2024 | 30.06.2023 |
| Net profit | 28,242 | 21,840 |
| Items that may be subsequently reclassified to profit or loss: | - | |
| - Exchange rate differences | 3,397 | (1,456) |
| Other items valued using the equity method | - | (127) |
| Items that may not be subsequently reclassified to profit or loss: | - | |
| - Actuarial gains (losses) on employee benefits net of the tax effect | - | - |
| - Actuarial gains on agents' termination benefits net of the tax effect | - | - |
| Total Comprehensive income | 31,639 | 20,257 |
| attributable to: | - | |
| - Owners of the parent | 31,014 | 21,154 |
| - Non-controlling interests | 625 | (769) |
Consolidated statement of cash flows
(euro/thousand)
| Consolidated Statement of Cash Flow | 30.06.2024 | of which related |
30.06.2023 | of which related |
|---|---|---|---|---|
| parties | parties | |||
| OPERATING ACTIVITES | - | - | - | |
| Net profit | 28,242 | - | 21,840 | - |
| Adjustments for: | - | - | - | - |
| Amortisation and depreciation | 7,613 | - | 6,886 | - |
| Provision | 1,104 | - | 1,976 | - |
| Net non-monetary financial (income) | 1,460 | - | 1,746 | - |
| Change in employee benefits liabilities | (179) | - | (138) | - |
| (Plus) or minus from disposal of fixed assets and investments | - | - | - | - |
| Unrealized currency exchange rate (gains) losses | 725 | - | 700 | - |
| Non-monetary changes related to liabilities for options granted to non controlling interests |
- | - | - | - |
| Investment equity valuation | (6,792) | (1,136) | ||
| Other non-monetary variations | 1,760 | - | (31) | - |
| Taxes | 9,168 | - | 9,703 | - |
| Cash flows from operating activities before changes in net working capital |
43,101 | - | 41,546 | - |
| (Increase)/decrease in trade receivables | 2,710 | 195 | (348) | 24 |
| (Increase)/decrease in inventories | 2,824 | - | (460) | - |
| (Increase)/decrease in conctract assets and liabilities for work in progress | (3,113) | - | (5,476) | - |
| (Increase)/decrease in other current assets | 67 | 2 | (1,657) | - |
| Increase/(decrease) in trade payables | (8,385) | (184) | (8,575) | (316) |
| Increase/(decrease) in advance from customers | (7,993) | 4 | (13,818) | - |
| Increase/(decrease) in other current liabilities | (3,380) | - | (1,542) | (282) |
| (Increase)/decrease in non-current assets | - | - | (33) | - |
| Increase/(decrease) in non-current liabilities | - | - | 127 | - |
| Income taxes paid | (5,740) | - | (7,383) | - |
| CASH FLOWS FROM OPERATING ACTIVITIES (A) | 20,091 | - | 2,381 | - |
| INVESTING ACTIVITIES | - | - | - | |
| Investments in property, plant and equipment | (4,966) | - | (3,742) | - |
| Disinvestments in property, plant and equipment | - | - | 196 | - |
| Investments in intangible assets | (517) | - | (780) | - |
| Disinvestments in intangible assets | - | - | - | - |
| Disinvestments/(investments) in financial assets | 6,556 | - | (0) | - |
| Disinvestments/(investments) in investments | - | - | 0 | - |
| Deferred price from the acquisition of controlling interest | - | - | - | - |
| Business combinations net of the acquired cash | 3,464 | - | - | - |
| CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES (B) | 4,538 | - | (4,326) | - |
| FINANCING ACTIVITIES | - | - | - | |
| Issuance of bank loans | 14,012 | - | 10,000 | - |
| Repayment of bank loans | (19,142) | - | (14,788) | - |
| Change in current bank loans and borrowings | 923 | - | (6,727) | - |
| Interests paid | (1,452) | (1,746) | ||
| Increase/(decrease) in other financial liabilities | (22,308) | (31) | (1,635) | (31) |
| Dividends paid | (13,804) | (10,206) | ||
| CASH FLOWS USED IN FINANCING ACTIVITIES (C) | (41,771) | - | (25,102) | - |
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (A ± B ± C) | (17,142) | - | (27,047) | - |
| EFFECT OF EXCHANGE RATE CHANGES ON BALANCE OF CASH HELD IN | 273 | - | (140) | - |
| FOREIGN CURRENCY CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD (E) |
92,785 | 94,365 | ||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (16,869) | - - |
(27,187) | - - |
| CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD (G=D+E+F) | 75,916 | - | 67,178 | - |
Statement of changes in consolidated shareholders' equity
(euro/thousand)
46
| Sha re l Ca ita p |
al Leg res erv e |
Tre asu ry sha res |
nsl ati Tra on res erv e |
Oth er res erv es and tai ned re nin ear gs |
fit for th Pro e y ear rib ble att uta to the of th ow ner e ent par |
rib ble Equ ity att uta the f th to ow ner s o e ent par |
ity Equ rib ble att uta to rol ling ont no n-c int sts ere |
TO TA L EQ UIT Y |
|
|---|---|---|---|---|---|---|---|---|---|
| lan Ba at J 1st 202 3 ce an uar y , |
6, 000 |
1, 200 |
( ) 2, 208 |
3, 953 |
89, 580 |
34, 588 |
133 111 , |
1, 818 |
134 930 , |
| All f p fit tio rio oca n o r ye ar pro |
- | - | - | - | 34, 588 |
( ) 34, 588 |
- | - | - |
| Dis trib uti of div ide nd on s |
- | - | - | - | ( ) 10, 206 |
- | ( ) 10, 206 |
- | ( ) 10, 206 |
| ive lan Inc ent p s |
- | - | ( ) 360 |
- | ( 4) |
- | ( ) 364 |
- | ( ) 364 |
| har Tre asu ry s es |
- | - | 79 | - | 268 | - | 346 | - | 346 |
| Ch e in lida tio ang co nso n a rea |
- | - | - | - | - | - | - | 1, 279 |
1, 279 |
| Tot al c hen siv e in om pre com e |
- | - | - | ( ) 1, 583 |
- | 22, 610 |
21, 027 |
( ) 769 |
20, 258 |
| Ba lan at J 30 th, 20 23 ce une |
6, 000 |
1, 200 |
( ) 2, 489 |
2, 370 |
114 225 , |
22, 610 |
143 914 , |
2, 328 |
146 242 , |
| Sha re ita l Ca p |
al Leg res erv e |
Tre asu ry sha res |
nsl ati Tra on res erv e |
Oth er res erv es and tai ned re nin ear gs |
fit for th Pro e y ear rib ble th att uta to e of th ow ner e ent par |
ity rib ble Equ att uta to the f th ow ner s o e ent par |
Equ ity rib ble att uta to rol ling ont no n-c int sts ere |
TO TA L E Q UIT Y |
|
|---|---|---|---|---|---|---|---|---|---|
| lan 1st 202 Ba at J 4 ce an uar y , |
6, 000 |
1, 200 |
( ) 2, 489 |
14 | 114 612 , |
49, 400 |
168 737 , |
2, 600 |
171 337 , |
| f p fit All tio rio oca n o r ye ar pro |
49, 400 |
( ) 49, 400 |
|||||||
| of Dis trib uti div ide nd on s |
( ) 13, 804 |
( ) 13, 804 |
( ) 167 |
( 1) 13, 97 |
|||||
| rch of har Pu tre ase asu ry s es |
( ) 523 |
( ) 156 |
( ) 679 |
( ) 679 |
|||||
| lan Inc ive ent p s |
683 | 683 | 683 | ||||||
| tio Put op ns |
( ) 26, 174 |
( ) 26, 174 |
( ) 26, 174 |
||||||
| Ch e in lida tio ang co nso n a rea |
16, 590 |
16, 590 |
|||||||
| al c hen siv e in Tot om pre com e |
3, 397 |
- | 27, 618 |
31, 014 |
625 | 31, 639 |
|||
| nsl ati olli Tra ntr on res erv e n on -co ng |
142 | 142 | 142 | ||||||
| int lloc ati st a ere on |
( ) |
- | ( ) |
- | |||||
| Ba lan at J 30 th, 20 24 ce une |
6, 000 |
1, 200 |
( ) 3, 012 |
3, 269 |
124 561 , |
27, 618 |
159 636 , |
19, 790 |
179 426 , |
Notes to the consolidated financial statements
Piovan S.p.A. ("the Company" or "the Parent Company"), the parent company of the group of the same name with registered office in Santa Maria di Sala (VE), via dell'Industria 16, is a jointstock company enrolled in the Venice Companies' Registration Office.
The shares of Piovan S.p.A. have been listed on the STAR segment of the MTA organized and managed by Borsa Italiana since October 19, 2018.
At June 30, 2024, of the Company's total share capital, in the amount of Euro 6,000,000, 58.35% was held by Pentafin S.p.A., while the remainder was distributed among private shareholders and in treasury shares.
The Company is the operative holding company of a group of companies engaged, in Italy and internationally (the "Group" or the "Piovan Group"), in the production of automation systems for the production processes for the storage, transport and treatment of polymers, recycled plastics and bio-resins ("Technical Polymers"), automation systems for the storage and transport of food fluids and food and non-food powders ("Food Systems & Industrial Applications") and technical assistance and marketing of spare parts and services ("Services"). The Group is a global leader in the Technical Polymers market in the design and production of plants and control systems for the automation of all phases of the polymers, recycled plastics and bio-resins production cycle. In particular, over recent years the Group has been particularly engaged in developing and producing systems to automate production processes for the circular economy for recycling and reusing plastic and for the production of plastics which are naturally compostable.
The technical solutions proposed by the Group, which permit the automation and streamlining of all the production and transformation process phases, include, for both the Technical Polymers and & Industrial Applications markets: (i) the design of machinery and engineering solutions; (ii) the production of plants and systems; and (iii) the installation at the customer's production facilities. In addition, the Group provides its customers with specific technical support from the preliminary design phase to the installation and start-up of the plant and machinery, ensuring ongoing support in order to guarantee optimal operation of the products installed.
The Group at June 30, 2024, comprised 43 companies located on 4 continents, of which 13 production companies, with 14 production facilities and 30 commercial and service companies.
The Periodic Financial Statements at June 30, 2024, have been prepared as per Article 154-ter of Legislative Decree No. 58/98 and subsequent amendments, in addition to the Consob's Issuers' Regulation.
Content, form and criteria for the preparation of the Condensed Half-Year Financial Statements at June 30, 2024.
The Condensed Consolidated Half-Year Financial Statements at June 30, 2024 were drawn up according to the measurement criteria set out by the IAS/IFRS endorsed by the European Union.
In summary, the Condensed Consolidated Half-Year Financial Statements have been prepared in accordance with IAS 34 "Interim Financial Reporting".
The Condensed Consolidated Half-Year Financial Statements at June 30, 2024 include the consolidated statement of financial position, the consolidated statement of profit and loss, the consolidated statement of comprehensive income, the statement of changes in consolidated equity, in addition to the consolidated statement of cash flow and these notes for the period between January 1, 2024 and June 30, 2024. Comparison is made with the statement of financial position at December 31, 2023 and with the statement of profit and loss and statement of comprehensive income, in addition to the statement of cash flow and the movements in equity, in the first half of 2023.
The Condensed Consolidated Half-Year Financial Statements at June 30, 2024 have been prepared on the basis of the historical cost convention, with the exception of derivative financial instruments which have been recognized at fair value as required by IFRS 9 - "Financial Instruments", and on a going-concern basis. The Group considers - also in view of its strong competitive positioning, its high profitability and the solidity of its balance sheet and financial position - that it operates as a going concern as per paragraphs 25 and 26 of IAS 1.
The "functional" and "presentation" currency of the Piovan Group, as defined by IAS 21, is the Euro.
The Condensed Consolidated Half-Year Financial Statements at June 30, 2024 have been prepared in thousands of Euro, which may result in rounding differences when individual line items are added together as the individual line items are calculated in Euro.
The preparation of the Condensed Consolidated Half-Year Financial Statements at June 30, 2024 in accordance with IAS/IFRS requires management to make estimates and assumptions which have an impact on the amounts reported in the financial statements and the relative notes; actual results may differ from the estimates made. Reference should be made to the Annual Consolidated Financial Report at December 31, 2023 with regards to the main areas requiring the use of estimates and assumptions.
Global conflicts
In early 2022, the outbreak of the war between Russia and Ukraine, and subsequently of the Israel-Palestine conflict, marked the start of a period of major global instability, both politically and economically. This climate, which continues to evolve, makes assessments of the impact of future scenarios on the Group's business and performance particularly complex.
The conflict is continuing to fuel major international humanitarian and social crises and is having major repercussions on the populations of these nations. Due to the international sanctions being used as a deterrent for some of the countries involved, we are also seeing a significant impact on trade and on their economies, which is exacerbating supply-chain issues.
The situation is constantly developing and the Company - also with the support of external consultants - is monitoring the situation and the international rules closely to assess any impact of the conflict on its operations. In fact, following the enactment of the eleventh sanctions package at the end of June 2023, the Group will no longer be able to operate in Russia.
The group however has only limited exposure in the areas impacted by the war (i.e. Ukraine, Russia, Belarus and the Israel-Palestine area) in either sales or purchases.
2023 also saw the reignition of strong tensions in the Middle East, where the Group operates albeit with very limited exposure. The situation is also evolving and is constantly being monitored in order to assess any direct and indirect impacts.
The order backlog at June 30, 2024 contracted on the previous year, although - at like-for-like scope - remaining relatively stable against the end of December 2023, and however above the Group's historic averages.
Consolidation scope and basis for preparation
These Consolidated Half-Year Financial Statements at June 30, 2024 include those of the Parent Company and its Italian and overseas subsidiaries.
Compared to December 31, 2023, the only change in the consolidation scope regards the first time consolidation of NuVu, following the purchase of 1% and the subsequent acquisition of control over the company by the Piovan Group, as outlined below.
"Other information" in the Explanatory Notes outlines the companies included in the consolidation scope at June 30, 2024.
The consolidation criteria adopted to prepare the Consolidated Financial Statements at June 30, 2024 are the same as those adopted and reported in the Annual Financial Report at December 31, 2023 in the paragraph "Consolidation principles and basis".
Acquisition of NuVu
On February 6, 2024, Piovan S.p.A. and Nu-Vu Conair Private Ltd. announced the signing of an agreement which stipulated the purchase by Piovan S.p.A. of 1% of the share capital of NuVu, an Indian company of which Piovan already indirectly holds 50% through the subsidiary Conair Pacific Equipment PTE Ltd, from the selling shareholders of NuVu. The acquisition was completed on February 14, 2024, following the satisfaction of all conditions set out under the agreement, and the Piovan Group currently holds a total stake of 51% in NuVu.
Nu-Vu Conair Pvt. Ltd. was a joint venture between NuVu Engineers, Ahmedabad, India and The Conair Group (part of the Piovan Group), Pennsylvania, USA. The joint venture began in 2007, and Nu-Vu Conair Pvt. Ltd. is currently one of the leading manufacturers of polymer processing automation systems in India. The company employs about 250 people and operates a manufacturing plant with a total area of about 150,000 sq. ft. (currently being expanded by an additional 80,000 sq. ft.) for the production of centralized vacuum conveying systems, drying systems, gravimetric dosing systems, chillers and mold temperature control units, crystallizers, conveyor belts, granulators and other polymer processing machinery.
This transaction was conducted with a view to: (i) further strengthening the Piovan Group's presence in Asia; (ii) consolidating the competitive position in India - one of the sector's fastest growing markets; (iii) localizing the Piovan Group's products in order to boost market penetration; (iv) supporting local Indian customers and global conglomerates investing in India; and (v) creating a HUB for field services in the region.
The consideration paid to purchase 1%, amounting to Euro 348 thousand, was determined based on a valuation prepared by an independent expert and was settled in full on the closing date.
The governance of the company is regulated by a shareholders' agreement which, among other provisions, includes among the rights of the Piovan Group, the right to decide on the company's "relevant activities".
The agreement with the selling shareholders, who as a result of the sale of 1% retained a 49% stake in the company, includes a Put/Call Option mechanism for third-party shareholders to exit in two tranches to be exercised between 2029 and 2032. Specifically, the contract stipulates:
- o a "First Put /Call Option", whereby the third-party shareholders can exercise a put option and Piovan S.p.A. can exercise a call option, of the shares held by the third-party shareholders, corresponding to 24.5% of NuVu's share capital, in the period between April 1, 2029 and November 30, 2029. Where not exercised, the right for both parties lapses.
- o a "Second Put /Call Option", whereby the third-party shareholders can exercise a put option and Piovan S.p.A. can exercise a call option, of the shares held by the third-party shareholders, corresponding to 24.5% of NuVu's share capital, in the period between April 1, 2032 and November 30, 2032. Where not exercised, the right for both parties lapses.
The sale price of the shares is determined on the exercise of the options, based on certain operating and financial parameters set out in the agreements between the parties.
In accordance with IAS 32 (paragraph 23), the liabilities were measured at fair value as of the transaction date, which is the present value of the sales price of the shares that will be determined when the options are exercised. The discount rate used was approximately 3.86%.
These options have been recognized under "liabilities for options granted to minority shareholders", as a balancing entry in Group equity, in view of the fact that the risks and benefits on the remaining 49% stake remain with the minority interests. The Group also continues to recognize the minority interests in the result for the year and in shareholders' equity until the put option is exercised.
Subsequent changes in the fair value of the liability are recognized in the statement of profit and loss.
The Piovan Group is considered to have gained control of NuVu on January 31, 2024 - the closest date to the closing. Therefore, the related results have been included on the consolidated financial statements as of that date.
Given that the assets and liabilities acquired represent a business, the transaction is considered to be a business combination as defined by IFRS 3. For this acquisition, it was chosen to apply the "Full goodwill method". This method provides for the recognition of the full amount of goodwill generated by the acquisition, also considering the portion attributable to minority interests. In this regard, minority interests are expressed at their full fair value, including also therefore the goodwill attributable to them.
The assets acquired and the liabilities assumed by Piovan as a result of this transaction are as follows:
| EUR/000 | Provisional Fair Value at acquisition date |
|---|---|
| ASSETS | |
| Property, plant and equipment | 4,668 |
| Intangible assets | 11,783 |
| - of which backlog and customer relationship |
11,779 |
| Other non-current assets | 25 |
| Deferred tax assets | 198 |
| Inventories | 3,767 |
| Trade receivables | 1,356 |
| Tax receivables | 6 |
| Other current assets | 208 |
| Cash and cash equivalents | 3,822 |
| TOTAL ASSETS | 25,834 |
| LIABILITIES | |
| Employee benefits plans | 65 |
| Provision for risks and charges | 190 |
| Deferred tax liabilities | 2,977 |
| Trade payables | 1,104 |
| Advances from costumers | 967 |
| Tax liabilities and social security contributions | 201 |
| Other current liabilities | 321 |
| TOTAL LIABILITIES | 5,826 |
| Fair value of net assets acquired | 20,008 |
The considerations made in the initial consolidation, as outlined in the "Periodic Financial Statements at March 31, 2024", had resulted in the provisional allocation to goodwill of the entire difference between the consideration paid, the assets acquired, and the liabilities assumed. These considerations were updated when preparing the Half-Year Financial Report at June 30, 2024, also on the basis of an analysis conducted by an independent expert. As allowed by IFRS 3, definitive recognition of the fair value of the assets and liabilities of the company acquired is to be completed within 12 months of the acquisition date. In the Condensed Consolidated Half-Year Financial Statements at June 30, 2024, the difference between the price paid and the assets acquired and the liabilities assumed was provisionally for INR 1,060,107 thousand (Euro 11,779 thousand) allocated to intangible assets of definite useful life (of which the customer list for Euro 11,381 thousand and the backlog for Euro 398 thousand, fully amortized at June 30, 2024), and to deferred taxes for INR 266,829 thousand (Euro 2,965 thousand). The difference between the price paid, the fair value of the assets acquired and the liabilities assumed was provisionally allocated for INR 1,246,421 thousand (Euro 13,849 thousand at the acquisition date) to Goodwill, calculated by measuring the minority interest shareholders' equity at fair value.
The purchase price allocation is not yet considered definitive, as allowed by IFRS 3, in consideration of the fact that certain information available at the acquisition date is still being analyzed.
Summary of the main accounting standards and policies
In preparing the Condensed Consolidated Half-Year Financial Statements at June 30, 2024, the same accounting standards and policies used to prepare the Consolidated Financial Statements at December 31, 2023 were adopted and to which reference should be made to the paragraph "Accounting policies". In addition, with regards to the accounting standards applicable from January 1, 2024, and indicated in the Annual financial report at December 31, 2023, no significant impacts were reported.
Changes in the main accounting standards applied and effects of the new standards
IFRS accounting standards, amendments and interpretations applicable to the Company and applied from January 1, 2024
-
On January 23, 2020, the IASB published an amendment entitled "Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Noncurrent" and on October 31, 2022 published an amendment entitled "Amendments to IAS 1 Presentation of Financial Statements: Non-Current Liabilities with Covenants". The purpose of the amendments is to clarify how to classify payables and other short or longterm liabilities. In addition, the amendments also improve the information that an entity must provide when its right to defer settlement of a liability for at least 12 months is subject to meeting certain parameters (i.e. covenants). The adoptions of these amendments do not have any effects on the Group consolidated financial statements.
-
On September 22, 2022, the IASB published an amendment entitled "Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback". The document requires the seller-lessee to measure the lease liability arising from a sale & leaseback transaction so as not to recognize income or losses relating to the retained right of use. The adoptions of these amendments do not have any effects on the Group consolidated financial statements.
- On May 25, 2023, the IASB published an amendment entitled "Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures: Supplier Finance Arrangements". The adoptions of these amendments do not have any effects on the Group consolidated financial statements.
IFRS standards, amendments and interpretations not yet endorsed by the European Union
- On May 30, 2024, the IASB published the document "Amendments to the Classification and Measurement of Financial Instruments—Amendments to IFRS 9 and IFRS 7″. This clarifies a number of problematic issues emerging from the post-implementation review of IFRS 9, including the accounting treatment of financial assets whose returns vary upon achievement of ESG objectives (i.e., green bonds). The amendments will be applicable to financial statements for periods beginning January 1, 2026. The Directors do not expect this amendment to have a significant impact on the Group consolidated financial statements.
- On May 9, 2024, the IASB published a new standard IFRS 19 Subsidiaries without Public Accountability: Disclosures. The new standard introduces some simplifications in the disclosures required by other IAS-IFRS standards. The standard will be effective from January 1, 2027, although advance application is permitted. The Directors do not expect this amendment to have a significant impact on the Group consolidated financial statements.
- On April 9, 2024, the IASB published a new standard IFRS 18 Presentation and Disclosure in Financial Statements - which will replace IAS 1 Presentation of Financial Statements. The new standard seeks to improve the presentation of key financial statement formats and introduces important changes to the income statement format. Specifically, the new standard requires that:
- o Revenues and expenses are classified into three new categories (operating section, investment section, and financial section), in addition to the tax and discontinued operations categories already in the income statement;
- o Two new sub-totals are presented: operating income and earnings before interest and taxes (i.e., EBIT).
The new standard also:
- o Requires more information on the performance indicators defined by management;
- o Introduces new criteria for aggregation and disaggregation of information; and,
- o introduces a number of changes to the format of the cash flow statement, including a requirement that operating income is used as the starting point for the presentation of the cash flow statement prepared using the indirect method and that certain classification options are eliminated for some existing items (such as interest paid, interest received, dividends paid and dividends received).
The standard will be effective from January 1, 2027, although advance application is permitted. The Directors are currently assessing the possible effects of introduction of this new standard on the Group's consolidated financial statements.
- On 15 August 2023, the IASB published an amendment entitled "Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability." The amendment will be applicable from 1 January 2025, although advance application is permitted. The Directors do not expect this amendment to have a significant impact on the Group consolidated financial statements.
- On January 30, 2014, the IASB published IFRS 14 Regulatory Deferral Accounts which permits only those adopting IFRS for the first time to continue to recognize amounts concerning Rate Regulation Activities according to the previous accounting standards adopted. As the Company/Group is a first-time adopter, this standard is not applicable.
Translation of accounts in foreign currencies
The receivables and payables originally expressed in foreign currencies are converted into Euro at the exchange rate of the relative transactions. The differences arising on the collection of receivables and settlement of payables in foreign currencies are recorded in the statement of profit and loss.
Revenues and income, costs and charges related to currency transactions are recorded at the exchange rate at the transaction date.
At the end of the period the assets and liabilities measured in foreign currencies, with the exception of non-current non-monetary assets (which maintain the carrying value of the transaction date) are recorded at the exchange rates at the reporting date and the relative gains or losses on exchange are recorded in the statement of profit and loss.
The main exchange rates (currency for 1 Euro) used to translate the financial statements in currencies other than the Euro for the periods ended June 30, 2024, December 31, 2023 and June 30, 2023 (comparative data) are summarized below:
| Currency | Average rate | Closing rate | ||||
|---|---|---|---|---|---|---|
| 30.06.2024 | 30.06.2023 | 30.06.2024 | 31.12.2023 | |||
| BRL | Brazilian Real | 5.49 | 5.48 | 5.89 | 5.36 | |
| CAD | Canadian Dollar | 1.47 | 1.46 | 1.47 | 1.46 | |
| CZK | Czech Koruna | 25.02 | 23.68 | 25.03 | 24.72 | |
| CNY | Yuan Renminbi | 7.80 | 7.49 | 7.77 | 7.85 | |
| GBP | Pound Sterling | 0.85 | 0.88 | 0.85 | 0.87 | |
| HUF | Forint | 389.92 | 380.71 | 395.10 | 382.80 | |
| MXN | Mexican Peso | 18.52 | 19.66 | 19.57 | 18.72 | |
| SGD | Singapore Dollar | 1.46 | 1.44 | 1.45 | 1.46 | |
| USD | US Dollar | 1.08 | 1.08 | 1.07 | 1.11 | |
| THB | Baht | 39.12 | 36.97 | 39.32 | 37.97 | |
| INR | Indian Rupee | 89.98 | 88.88 | 89.25 | 91.90 | |
| TRY | Turkish Lira | 34.25 | 21.54 | 35.19 | 32.65 | |
| AED | UAE Dirham | 3.97 | 3.97 | 3.93 | 4.06 | |
| JPY | Yen | 164.50 | 145.75 | 171.94 | 156.33 | |
| VND | Dong | 26,981.50 | 25,434.33 | 27,250.00 | 26,808.00 | |
| MAD | Dirham Marocco | 10.83 | 11.02 | 10.66 | 10.93 | |
| KRW | Won sud | 1,460.41 | 1,401.54 | 1,474.86 | 1,433.66 | |
| TWD | Taiwan Dollar | 34.48 | 0.00 | 34.80 | 33.87 | |
| IDR | Indonesian Rupee | 17,207.01 | 16,274.92 | 17,487.21 | 17,079.71 |
Utilization of estimates
When preparing these Condensed Consolidated Half-Year Financial Statements, the Directors had to apply accounting policies and methods which, in some circumstances, are based on difficult, subjective evaluations, or on past experience or on assumptions that are, periodically, considered reasonable and realistic depending on the specific circumstances. The application of these estimates and assumptions impact upon the amounts reported in the financial statements, in addition to the disclosure.
The final outcome of the valuations for which the above estimates and assumptions were used may differ from those reported in the financial statements because of the uncertainty that characterizes the assumptions and the conditions on which the estimates are based.
The items that, given their nature, have provided for greater recourse by the Directors to the use of estimates and for which a change in the conditions underlying the assumptions used may have an impact on the consolidated financial statements are as follows:
- Liabilities for put options granted to non-controlling interests: the conditions under which these liabilities exist and their valuation, depending on the contractual provisions, may be based on future forecasts relating to economic and financial parameters and are therefore inherently uncertain;
- Impairment test on goodwill: this test is used to assess the recoverability of goodwill allocated to cash generating units. The allocation of goodwill to cash generating units and the determination of its value in use requires the use of estimates that depend on factors that may change over time. The Group tests goodwill for impairment at least once a year. For the purposes of this test, the recoverable value generated by the cash generating units (CGU's) was determined as the value in use using the "discounted cash
flows" method. The Piovan Group conducted impairment testing at December 31, 2023, on goodwill, reviewing the forward-looking data for the CGUs, considering the most updated available information. For the half-year financial report at June 30, 2024, the Directors, did not find elements that would require an updated impairment test.
• Potential liabilities connected to tax assessment: the assessment carried out by the Directors and described in paragraph "Significant events in the first half of 2024", are based on actual circumstances. In case events were to occur that would substantially change the current circumstances, these assessments could change resulting in an update by the Directors in the approach currently adopted linked to this potential liability.
Segment information
IFRS 8 requires that disclosures regarding operating segments be prepared in such a way as to provide the information necessary to assess the nature and effects on the financial statements of business activities and operating environments. This is done based on internal reporting and operating activities that generate revenues and costs, whose results are reviewed periodically by the chief operating decision maker in order to make decisions about resources to be allocated and to assess performance; operating segments were not identified other than the Group as a whole.
The disclosures also required for entities that have a single segment to report on products sold and services provided and geographical areas are provided in note [26].
Information on risks and financial instruments
The accounting policies applied in the preparation of the Half-Year Financial Report at June 30, 2024 for financial instruments are described in the "Accounting policies" section of the Annual Financial Report at December 31, 2023.
Group operations are exposed to a series of financial risks which may impact the balance sheet/financial position, the result and the cash flows, through the relative impact on financial instrument transactions.
There were no changes compared to that indicated in the Annual Financial Report at December 31, 2023 regarding the risks to which the Group is exposed and their management. In particular, in early 2022, the outbreak of the war between Russia and Ukraine, and subsequently of the Israel-Palestine conflict, marked the start of a period of major global instability, both politically and economically. This climate, which continues to evolve, makes assessments of the impact of future scenarios on the Group's business and performance particularly complex.
The conflict is continuing to fuel major international humanitarian and social crises and is having major repercussions on the populations of these nations. Due to the international sanctions being used as a deterrent for some of the countries involved, we are also seeing a significant impact on trade and on their economies, which is exacerbating supply-chain issues.
The situation is constantly developing and the Company - also with the support of external consultants - is monitoring the situation and the international rules closely to assess any impact of the conflict on its operations. In fact, following the enactment of the eleventh sanctions package at the end of June 2023, the Group will no longer be able to operate in Russia.
The group however has only limited exposure in the areas impacted by the war (i.e. Ukraine, Russia, Belarus and the Israel-Palestine area) in either sales or purchases.
2023 also saw the reignition of strong tensions in the Middle East, where the Group operates albeit with very limited exposure. The situation is also evolving and is constantly being monitored in order to assess any direct and indirect impacts.
These developments, which are extraordinary in nature and extent, have had and continue to have, direct and indirect repercussions on economic activity giving rise to an environment of general uncertainty and whose evolution and effects are unforeseeable. This macroeconomic landscape may also have inevitable repercussions on the other risks identified in the Annual Financial Report at December 31, 2023.
In terms of currency risk, the exposure of assets, liabilities, revenues and pre-tax profits in foreign currencies is outlined below.
The following table summarizes the exposure relating to foreign currency assets and liabilities while showing the most important currencies for each year:
| 31.12.2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (€/000) | EUR | USD | CNY | BRL | MXN | THB | GBP | CAD | INR | Other cu. | Total |
| Total assets | 187,317 | 252,291 | 16,979 | 11,354 | 14,656 | 5,605 | 4,727 | 4,390 | 1,806 | 5,620 | 504,745 |
| Total liabilities | 171,086 | 127,253 | 7,408 | 6,042 | 8,825 | 3,642 | 3,832 | 2,169 | 334 | 2,819 | 333,408 |
| 30.06.2024 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (€/000) | EUR | USD | CNY | BRL | MXN | THB | GBP | CAD | INR | Other cu. | Total |
| Total assets | 196,965 | 211,457 | 19,110 | 9,182 | 14,260 | 4,829 | 2,754 | 3,107 | 42,897 | 5,311 | 509,872 |
| Total liabilities | 232,651 | 62,531 | 9,395 | 3,221 | 8,767 | 1,589 | 3,157 | 432 | 6,591 | 2,112 | 330,446 |
The table below provides a sensitivity analysis of revenues to the risk arising from the translation into euros of revenues generated in currencies other than the euro, for changes of around + /- 10% compared with the average exchange rate for the period:
| 30.06.2024 | 30.06.2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| Revenues | FX in LC | Current Forex in € |
Forex +10% |
Forex - 10% |
FX in LC | Current Forex in € |
Forex +10% |
Forex - 10% |
| EUR - Euro | 107,411 | 107,415 | 107,411 | 107,411 | 106,115 | 106,115 | 106,115 | 106,115 |
| USD - Dollaro USA | 156,574 | 144,762 | 131,652 | 160,908 | 163,243 | 150,941 | 137,270 | 167,774 |
| CNY - Renminbi | 57,766 | 7,405 | 6,732 | 8,228 | 74,114 | 9,895 | 8,996 | 10,995 |
| BRL - Real | 26,716 | 4,862 | 4,420 | 5,403 | 26,483 | 4,830 | 4,391 | 5,366 |
| GBP - Sterlina Inglese | 2,531 | 2,961 | 2,692 | 3,290 | 3,286 | 3,748 | 3,408 | 4,165 |
| THB - Bath | 53,248 | 1,361 | 1,237 | 1,512 | 49,667 | 1,344 | 1,221 | 1,493 |
| TRY - Lira Turca | 15,241 | 445 | 405 | 494 | 8,795 | 408 | 371 | 454 |
| INR - Rupia Indiana | 755,039 | 8,391 | 7,628 | 9,324 | 59,625 | 671 | 610 | 745 |
| JPY - Yen Giapponese | 6,631 | 40 | 37 | 45 | 2,623 | 18 | 16 | 20 |
| CAD - Dollaro Canadese | - | - | - | - | - | - | - | - |
| MXN - Peso Messicano | 37,599 | 2,030 | 1,846 | 2,256 | 70,326 | 3,584 | 3,253 | 3,976 |
| AED - Dirham Emirati Arabi | 239 | 60 | 55 | 67 | 316 | 80 | 72 | 88 |
| VND - Dong Vietnamita | 15,549,796 | 576 | 524 | 640 | 10,165,735 | 400 | 363 | 444 |
| HUF - Fiorino Ungherese | 9,799 | 25 | 23 | 28 | 12,134 | 32 | 29 | 35 |
| CZK - Corona Ceca | 5,374 | 215 | 195 | 239 | 4,916 | 208 | 189 | 231 |
| KRW - Won Sudcoreano | 16,860 | 12 | 10 | 13 | - | - | - | - |
| MAD - Dirham Marocchino | 160 | 15 | 13 | 16 | 88 | 8 | 7 | 9 |
| TWD - Nuovo Dollaro Taiwanese | 43,912 | 1,274 | 1,158 | 1,415 | 104,205 | 3,154 | 2,868 | 3,505 |
| IDR - Rupia Indonesiana | 334,846 | 19 | 18 | 22 | - | - | - | - |
| TOTAL | 281,869 | 266,056 | 301,310 | 285,436 | 269,178 | 305,415 |
The table below provides a sensitivity analysis of the pre-tax profit to the risk arising from the translation of financial statements denominated in currencies other than the euro, for changes of around + /- 10% compared with the average exchange rate for the period.
| 30.06.2024 | 30.06.2023 | ||||||
|---|---|---|---|---|---|---|---|
| Result before taxes | Current Forex in € |
Forex +10% | Forex - 10% |
Current Forex in € |
Forex +10% | Forex - 10% |
|
| EUR - Euro | 21,789 | 21,789 | 21,789 | 13,788 | 13,788 | 13,788 | |
| USD - US Dollar | 11,067 | 10,061 | 12,297 | 14,045 | 12,768 | 15,606 | |
| CNY - Renminbi | (932) | (847) | (1,036) | 904 | 822 | 1,005 | |
| BRL – Real | 446 | 405 | 496 | 748 | 680 | 831 | |
| GBP - Pound sterling | 111 | 101 | 123 | 424 | 386 | 471 | |
| THB – Bath | 370 | 336 | 411 | 278 | 253 | 309 | |
| TRY - Turkish lira | 304 | 276 | 338 | 69 | 62 | 76 | |
| INR - Indian rupee | 890 | 809 | 989 | 272 | 247 | 302 | |
| JPY - Japanese yen | 63 | 57 | 70 | (72) | (66) | (81) | |
| CAD - Canadian dollar | 872 | 793 | 969 | 471 | 428 | 524 | |
| MXN - Mexican peso | 2,216 | 2,015 | 2,462 | 324 | 294 | 360 | |
| AED - United Arab Emirates dirham | 217 | 197 | 241 | 107 | 97 | 119 | |
| VND - Vietnamese Dong | 19 | 17 | 21 | 33 | 30 | 37 | |
| HUF - Hungarian forint | 20 | 18 | 22 | (22) | (20) | (25) | |
| KRW - South Corean Won | (111) | (101) | (123) | ||||
| MAD - Dirham | 40 | 36 | 44 | 48 | 44 | 54 | |
| CSK - Czech Koruna | 90 | 82 | 100 | 161 | 147 | 179 | |
| TWD - New Taiwan Dollar | 15 | 14 | 17 | ||||
| IDR - Indonesian rupiah | (76) | (69) | (84) | (33) | (30) | (37) | |
| TOTAL | 37,410 | 35,989 | 39,145 | 31,544 | 29,929 | 33,517 |
With regard to the market risk related to interest rates, the following table shows an analysis of the sensitivity of interest expense to the risk arising from fluctuations in interest rates on floating rate loans, assuming an increase / decrease of 1% and 2% in interest rates.
| Interest expense on variable rate loans (€'000) |
Interest expenses |
+1.00% | +2.00% | -1.00% | -2.00% | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| 30.06.2024 | 597 | 706 | 821 | 476 | 361 | |||||
| Interest expense on variable rate loans | Interest | +0.25% | +0.50% | -0.25% | -0.50% | |||||
| (€'000) | expenses | |||||||||
| 30.06.2023 | 324 | 471 | 580 | 252 | 142 |
Explanatory Notes to the consolidated statement of financial position
[1] Property, plant and equipment
They amount to Euro 58,516 thousand at June 30, 2024 (Euro 50,887 thousand at December 31, 2023). They are composed as shown in the following table, which also present the changes in H1 2024.
| Category | 31.12.2023 | Change in conso. area |
Invest. | Dispos als |
Translati on reserve |
Reclass | Depr. | 30.06.2024 | |
|---|---|---|---|---|---|---|---|---|---|
| Histor. cost | 48,167 | 3,223 | 26 | - | 462 | 98 | - | 51.976 | |
| Land and buildings |
Depr. fund | (15,918) | (178) | - | 0 | (233) | - | (682) | (17.010) |
| Total | 32,249 | 3,045 | 26 | 0 | 230 | 98 | (682) | 34.966 | |
| Histor. cost | 25,783 | 956 | 354 | (22) | 161 | 75 | - | 27.308 | |
| Plant and machinery |
Depr. fund | (16,228) | (440) | - | 21 | (147) | - | (683) | (17.477) |
| Total | 9,555 | 517 | 354 | (1) | 13 | 75 | (683) - (172) (172) (12) (775) (787) - - - (2,323) |
9.831 | |
| Industrial and | Histor. cost | 6,583 | 28 | 137 | (43) | 3 | - | 6.708 | |
| commer. | Depr. fund | (5,839) | (13) | - | 43 | (1) | - | (5.983) | |
| equipment | Total | 743 | 14 | 137 | (0) | 2 | - | 725 | |
| Histor. cost | 28,932 | 447 | 379 | (100) | 348 | 97 | 30.091 | ||
| Other assets | Depr. fund | (24,695) | (290) | - | 124 | (305) | 91 | (25.850) | |
| Total | 4,237 | 156 | 379 | 24 | 44 | 188 | 4.241 | ||
| Assets under | Histor. cost | 4,102 | 935 | 4,070 | - | 34 | (388) | 8.752 | |
| constr. and | Depr. fund | - | - | - | - | - | - | - | |
| advances | Total | 4,102 | 935 | 4,070 | - | 34 | (388) | 8.752 | |
| Total | 50.887 | 4,668 | 4,966 | 24 | 322 | (27) | 58,516 |
Capital expenditures in H1 2024 totaled Euro 4,966 thousand, of which non-recurring totaling Euro 3,829 thousand and mainly relating for Euro 1,216 thousand to the subsidiary FEA S.r.l. as part of the production area expansion, for Euro 1,829 thousand to the subsidiary Piovan Industrial Automation, related to the construction work on the new building in China, and for Euro 785 thousand to Nu-Vu Conair Pvt. Ltd. mainly related to the construction of the new factory in India.
The table below provides a geographical area breakdown of tangible assets:
| Property, plant and equipment | 30.06.2024 | 31.12.2023 |
|---|---|---|
| EMEA | 34,671 | 34,354 |
| - of which Italy | 33,780 | 33,354 |
| NORTH AMERICA | 11,648 | 11,644 |
| - of which the United States of America | 11,435 | 11,560 |
| ASIA | 11,015 | 3,589 |
| SOUTH AMERICA | 1,182 | 1,299 |
| Total | 58,516 | 50,887 |
At June 30, 2024, property, plant and equipment are not burdened by mortgages or liens.
They are adequately covered against the risk of loss and/or damage through insurance policies with leading insurance companies.
Finally, no borrowing costs directly attributable to the acquisition, production or construction of tangible assets have been capitalized.
[2] Right-of-use
Right-of-use assets at June 30, 2024, of Euro 17,760 thousand increased on Euro 16,715 thousand at December 31, 2023.
The increases in the item "Buildings" relate mainly to the recognition of a new lease for an office by Piovan Czech Republic and the expansion of space rented from the subsidiary FDM Gmbh and the extension of the current lease. The increases in "Other assets" relate to new or renewed vehicle rental contracts for Piovan UK, Piovan GmbH and Piovan France.
| Category | 31.12.2023 | Additions | Disposals | Translation reserve |
Depr. | 30.06.2024 | |
|---|---|---|---|---|---|---|---|
| Histor. cost | 23,156 | 3,289 | (2,308) | 332 | - | 24.470 | |
| Land and | Depr. fund | (8,434) | - | 1,041 | (105) | (1,488) | (8.986) |
| buildings | Total | 14,722 | 3,289 | (1,267) | 227 | (1,488) | 15.484 |
| Histor. cost | 0 | - | - | - | - | 0 | |
| Plant and | Depr. fund | 0 | - | - | - | - | 0 |
| machinery | Total | 0 | - | - | - | - | 0 |
| Industrial and | Histor. cost | - | - | - | - | - | - |
| commercial | Depr. fund | - | - | - | - | - | - |
| equipment | Total | - | - | - | - | - | - |
| Histor. cost | 3,717 | 754 | (24) | 2 | - | 4.450 | |
| Other assets | Depr. fund | (1,724) | - | 19 | 3 | (470) | (2.173) |
| Total | 1,993 | 754 | (5) | 5 | (470) | 2.277 | |
| Total | 16.715 | 4,044 | (1,272) | 231 | (1,958) | 17,760 |
Below is a table with the changes in the year for each class of Right-of-Use:
The Right-of-use broken down by geographical area is presented below:
| Right of use | 30.06.2024 | 31.12.2023 |
|---|---|---|
| EMEA | 10,227 | 8,891 |
| - di cui Italia | 4,418 | 4,767 |
| NORTH AMERICA | 7,090 | 7,745 |
| - di cui Stati Uniti | 6,771 | 7,387 |
| ASIA | 443 | 79 |
| SOUTH AMERICA | 0 | 0 |
| Totale | 17,760 | 16,715 |
[3] Intangible assets
They amount to Euro 146,503 thousand at June 30, 2024, compared to Euro 120,315 thousand at December 31, 2023. The breakdown of the movements are as follows:
| Category | 31.12.2023 | Change in conso area |
Invest. | Transl. reserve |
Reclass. | Depr. | 30.06.2024 |
|---|---|---|---|---|---|---|---|
| Goodwill | 61,863 | 13,849 | - | 1,522 | - | - | 77,234 |
| Industrial patent and intellectual property rights |
627 | - | 52 | 12 | 4 | (139) | 556 |
| Concessions, licences, trademarks and similar rights |
6,391 | 4 | 91 | 174 | - | (298) | 6,362 |
| Other intangible assets | 50,901 | 11,779 | - | 1,640 | 23 | (2,895) | 61,448 |
| Assets under constr. and advances |
533 | - | 374 | (4) | - | - | 903 |
| Total | 120,315 | 25,632 | 517 | 3,344 | 27 | (3,332) | 146,503 |
The changes in consolidated companies are due, as already described, to the addition of NuVu to the consolidation scope and the provisional purchase price allocation, which concerned both Goodwill and intangible assets of finite useful life (customer list e backlog).
The table below provides a geographical area breakdown of intangible assets:
| Intangible Assets | 30.06.2024 | 31.12.2023 |
|---|---|---|
| EMEA | 21,030 | 21,115 |
| - of which Italy | 20,613 | 21,115 |
| NORTH AMERICA | 99,963 | 98,929 |
| - of which the United States of America | 99,963 | 98,929 |
| ASIA | 25,272 | 25 |
| SOUTH AMERICA | 239 | 247 |
| Total | 146,503 | 120,315 |
Goodwill at June 30, 2024 amounted to Euro 77,234 thousand, compared to Euro 61,863 thousand at December 31, 2023.
| Goodwill | 31.12.2023 | Change in consolidation area |
Change in translation reserve |
30.06.2024 |
|---|---|---|---|---|
| UnaDyn | 3,388 | - | 109 | 3,497 |
| Food | 2,146 | - | - | 2,146 |
| Energys | - | - | - | - |
| Doteco | 15,695 | - | - | 15,695 |
| Conair | 28,289 | - | 899 | 29,188 |
| Pelletron | 5,032 | - | 162 | 5,194 |
| Thermal Care | 7,305 | - | 235 | 7,540 |
| NuVu | - | 13,849 | 117 | 13,966 |
| Other | 8 | - | - | 8 |
| Totale | 61.863 | 13,849- | 1,522 | 77,234 |
The increase in value on the previous year mainly relates to the provisional allocation concerning the recent acquisition of NuVu. The difference between the price paid and the assets acquired and the liabilities assumed was provisionally for INR 1,060,107 thousand (Euro 11,779 thousand at the acquisition date) to intangible assets of finite useful life (of which customer list for Euro 11,381 thousand and backlog for Euro 398 thousand, fully amortized at June 30, 2024), to deferred taxes for INR 266,829 thousand (Euro 2,965 thousand at the acquisition date). The difference between the price paid, the fair value of the assets acquired and the liabilities assumed was provisionally in allocated for INR 1,246,421 thousand (Euro 13,849 thousand at the acquisition date) to goodwill, calculated by measuring the minority interest shareholders' equity at fair value, according to the full goodwill method that the Company decided to adopt.
The purchase price allocation is not yet considered definitive, as allowed by IFRS 3, in consideration of the fact that certain information available at the acquisition date is still being analyzed.
In addition to goodwill, the figure includes the intangible assets recognized following the acquisition of the IPEG group, particularly in the form of know-how for a residual Euro 9,830 thousand, customer relationships for a residual Euro 38,580 thousand, trademarks for a residual Euro 5,928 thousand, and goodwill for Euro 41,922 thousand.
The goodwill mainly refers to the acquisition:
- the US subsidiary Universal Dynamics Inc. ("Unadyn CGU") in 2008;
- the acquisition of Penta S.r.l. at the end of 2014, in Progema S.r.l. in 2006 and in FEA in 2019, "Food CGU";
- Doteco S.p.A. in 2020, "Doteco CGU";
- of the IPEG group in 2022, divided into three CGU: "Conair", "Pelletron", "Thermal Care";
- of NuVu, whose closing took place at the beginning of February 2024.
The amount of tax deductible goodwill totals Euro 1,332 thousand and is attributable to the IPEG group.
No facts or events have been identified that would require updated impairment testing compared to the testing conducted for the accounts at December 31, 2023, which reported very high levels of coverage.
[4] Equity investments
They amount to Euro 1,322 thousand at June 30, 2024, compared to Euro 11,426 thousand at December 31, 2023. The decrease on December 31, 2023 is due to the elimination of the equity investment in NuVu now fully consolidated following the acquisition of control achieved in the first half-year. This transaction has implied the preliminary evaluation at fair value, determined with regard to the value recognized to third-party shareholders as part of the transaction itself, of the previously held share, equal to 50%. The related income, equal to Euro 6,393 thousand, was recognized in the income statement for the half-year under the item "Profit (losses) from equity investments carried at equity" (Note [37]).
Details of the movements in these equity investments are as follows:
| Company | Registered office | % | 31.12.2023 | Equity val. |
Other mov. |
Transl. reserve |
30.06.2024 |
|---|---|---|---|---|---|---|---|
| CMG S.p.A. | Budrio (BO) | 20% | 344 | 165 | - | - | 509 |
| Penta Auto Feeding India Ltd | Mumbai (India) | 50% | 75 | 234 | - | 3 | 312 |
| Nu-Vu Conair Pvt. Ltd. | Ahmedabad (India) | 50% | 10,529 | 6,393 | (16,914) | (8) | - |
| Total | 10,948 | 6,792 | (16,914) | (5) | 821 | ||
| Affinity | 472 | - | - | 15 | 487 | ||
| Toba PNC | 10% | - | - | - | - | - | |
| Other | 6 | - | - | 8 | 14 | ||
| Total | 478 | - | - | 23 | 501 | ||
| Total Equity investments | 11,426 | 6,792 | (16,914) | 18 | 1,322 |
Equity investments in associates and joint ventures as indicated in the table above have been measured at equity. Other equity investments have been measured at fair value through profit or loss. Following the sale of the 41% stake in Toba PNC in 2023, the Group continued to hold a minority interest of 10%. The value of the investment was fully written down.
[5] Other non-current assets
At June 30, 2024, these amounted to Euro 618 thousand, compared to Euro 570 thousand at December 31, 2023; they mainly refer to various security deposits paid by Group companies on utilities and lease contracts for buildings where Group companies have their headquarters.
[6] Deferred tax assets and liabilities
Deferred tax assets amounted to Euro 12,243 thousand at June 30, 2024, compared to Euro 11,913 thousand at December 31, 2023.
Deferred tax liabilities amounted to Euro 15,779 thousand at June 30, 2024, compared to Euro 12,822 thousand at December 31, 2023. The Group has set aside deferred tax assets and liabilities on temporary differences between book values and tax values.
In particular, deferred tax assets and liabilities derive from the accrual of taxes on future costs or benefits with respect to the year in question, mainly as a result of increased taxes generated from the non-deductibility of losses on receivables, write-downs of equity investments, directors' fees not yet paid, and other amortization and depreciation deductible in subsequent years and provisions for risks.
Taxation has been calculated on the basis of the rates in force when the temporary differences will reverse in the various countries where the Group operates.
The deferred tax liabilities mainly related to the deferred taxes on the gains on the purchase price allocation of the IPEG group, in the amount of Euro 12,172 thousand at June 30, 2024 and deferred taxes relating to the provisional allocation of NuVu amounting to Euro 2,808 thousand as at June 30, 2024.
The movement in deferred tax assets and deferred tax liabilities are reported below:
| 31.12.2023 | Change in consolidation area |
Increase/(Decrease) in income statement |
Change in Currency translation reserve |
30.06.2024 | |
|---|---|---|---|---|---|
| Deferred tax asset | 11,913 | - | (149) | 479 | 12,243 |
| Deferred tax liability | (12,822) | (2,965) | 574 | (566) | (15,779) |
| Totale | (909) | (2,965) | 425 | (87) | (3,536) |
[7] Inventories
At June 30, 2024, they amounted to Euro 86,270 thousand, compared to Euro 85,341 thousand at December 31, 2023; the breakdown is shown below:
| Inventories | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Raw materials | 44,798 | 43,358 |
| Semi-finished products | 25,694 | 23,979 |
| Finished goods | 28,290 | 29,984 |
| Progress payments | 3,234 | 3,235 |
| Allowance for inventory write-down | (15,746) | (15.215) |
| Inventories | 86,270 | 85,341 |
Inventories increased on December 31, 2023, mainly due to the consolidation of NuVu, whose inventory contributed Euro 3,378 thousand at June 30, 2024. Net of this effect, inventories are slightly reduced, thanks to better inventory management, if compared with amounts at December 31, 2023, and are consistent with provisioning needs and business trends.
[8] Contract assets and contract liabilities for work-in-progress
At June 30, 2024, the item Assets for contract work-in-progress amounted to Euro 12,687 thousand, compared with Euro 8,828 thousand at December 31, 2023.
Liabilities for contract work-in-progress amounted to Euro 5,249 thousand at June 30, 2024, compared with Euro 4,748 thousand at December 31, 2023.
The following table shows the amount due from customers net of the relative advance payments (included under Assets for contract work-in-progress), and the amount due to customers, net of the relative advance payments (included under Liabilities for contract work-in-progress):
| Contract assets for work in progress | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Measurement of contracts in progress (costs incurred added to profits recognized) | 36,103 | 20,539 |
| Progress payments received | (23,416) | (11,710) |
| Amounts due from customers | 12,687 | 8,828 |
| Contract liabilities for work in progress | 30.06.2024 | 31.12.2023 |
| Measurement of contracts in progress (costs incurred added to profits recognized) | 10,567 | 24,318 |
| Progress payments received | (15,816) | (29,066) |
[9] Trade receivables
They amounted to Euro 77,960 thousand at June 30, 2024, compared to Euro 79,979 thousand at December 31, 2023. This item, which represents the exposure to third parties, is broken down as follows:
| Trade receivables | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Gross trade receivables | 84,012 | 85,655 |
| Provision for bad debt | (6,051) | (5,675) |
| Trade receivables | 77,960 | 79,979 |
The value of receivables slightly decreased on December 31, 2023, in line with the Group's collection policies.
Write-downs are made on the basis of a careful analysis of past due accounts of customers in financial difficulties and clients with whom legal action has been initiated, in addition to estimated expected losses on receivables by management. The estimate considers past experience for similar receivables, current and historic amounts overdue, losses incurred, receipts, monitoring of the credit quality and projections on economic and market conditions, with the information known at the reporting date.
The annual provision is included under Other operating costs.
The following table shows the value of receivables at June 30, 2024, compared to the previous year, by maturity bracket and the relevant portion of the doubtful debts provision.
| Receivables and bad debt Reserve | 30.06.2024 | 31.12.2023 | ||
|---|---|---|---|---|
| Receivables | Bad Debt Reserve | Receivables | Bad Debt Reserve | |
| Receivables due to expire | 47,519 | (711) | 56,599 | (377) |
| Receivables overdue whitin 30 days | 20,098 | (248) | 9,777 | (498) |
| Receivables overdue between 1 and 12 months | 12,889 | (1,586) | 15,763 | (1,334) |
| Receivables overdue over 12 months | 3,506 | (3,506) | 3,515 | (3,466) |
| Total | 84,012 | (6,051) | 85,654 | (5,675) |
Receivables by geographical area are as follows:
| €/000 | 30.06.2024 | 31.12.2023 |
|---|---|---|
| EMEA | 34,328 | 31,489 |
| of which Italy | 15,985 | 15,421 |
| North America | 29,707 | 35,307 |
| ASIA | 1,345 | 8,942 |
| SOUTH AMERICA | 12,580 | 4,241 |
| Receivables | 77,960 | 79,979 |
The provision for bad debt reports the following movements in the period:
| Provision for bad debt | ||
|---|---|---|
| 31.12.2023 | 5,675 | |
| Release | (372) | |
| Accruals | 726 | |
| Utilisations | (84) | |
| Change in consolidation area | 76 | |
| Exchange rate differences | 31 | |
| 30.06.2024 | 6,051 |
[10] Current financial assets
They amounted to Euro 6,556 thousand at December 31, 2023 and included bonds purchased in order to invest available financial resources. These instruments matured in the first quarter of 2024 and therefore the value of this account reduced to zero.
[11] Tax receivables
They amounted to Euro 6,219 thousand at June 30, 2024, compared to Euro 6,267 thousand at December 31, 2023. VAT receivables mainly refer to the parent company Piovan S.p.A. and the subsidiaries Penta S.r.l. and Fea.
| Tax receivables | 30.06.2024 | 31.12.2023 |
|---|---|---|
| VAT receivables | 1,853 | 2,983 |
| Other current tax assets | 4,366 | 3,284 |
| Tax receivables | 6,219 | 6,267 |
[12] Other current assets
They amounted to Euro 14,177 thousand at June 30, 2024, compared to Euro 13,163 thousand at December 31, 2023. A breakdown follows:
| Other current assets | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Advances to suppliers | 10,614 | 9,009 |
| Prepayments and accrued expenses | 2,415 | 2,596 |
| Other receivables | 1,063 | 1,558 |
| Other current assets | 14,177 | 13,163 |
[13] Cash and cash equivalents
They amount overall to Euro 75,916 thousand at June 30, 2024, compared to Euro 92,785 thousand at December 31, 2023.
| Cash and cash equivalents | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Current accounts and post office deposits | 63,513 | 79,246 |
| Cash equivalent | 12,330 | 13,500 |
| Cash | 73 | 39 |
| Cash and cash equivalents | 75,916 | 92,785 |
Current accounts and postal deposits are classified as current assets, as highly liquid and convertible into cash with an exchange rate risk that is considered not significant.
The "Cash equivalents" account includes a time deposit that can be divested rapidly.
For further information on the movements to cash and cash equivalents, reference should be made to the Statement of Cash Flows.
[14] Equity attributable to the owners of the Parent
Equity is made up as follows:
| Equity attributable to the owners of the parent | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Share capital | 6,000 | 6,000 |
| Legal reserve | 1,200 | 1,200 |
| Reserve for own shares in portfolio | (3,012) | (2,489) |
| Translation reserve | 3,269 | 14 |
| Other Reserves and retained earnings | 124,561 | 114,612 |
| Net profit (loss) | 27,618 | 49,400 |
| Equity attributable to the owners of the parent | 159,636 | 168,737 |
The Company's share capital approved, subscribed and paid-in amounted to Euro 6,000,000, divided into 53,600,000 ordinary shares with no par value.
Therefore, the Company and the Group as at June 30, 2024 hold 2,474,475 treasury shares, equal to 4.62% of the share capital of Piovan S.p.A., directly through Piovan S.p.A. with a value of Euro 3,012 thousand at June 30, 2024. The change from the previous year is related to the assignment of treasury shares in January 2024 in relation to the second cycle of the 2021-2023 Performance Shares Plan. For this cycle, 161,113 shares were assigned to the beneficiaries of the plan, of which 68,049 were simultaneously withheld by the Company in order to meet the beneficiaries' fiscal obligations, in the form of a substitute tax, related to this assignment.
It should be noted that, with reference to the 2020–2022 Performance Shares Plan, for the third cycle, certain executives of the Parent Company were granted the right to receive shares in Piovan S.p.A., which on vesting number 165,178, based on achieving the plan's targets, with vesting in 2024. The total value is Euro 582 thousand, whereas the amounts vested at June 30, 2024 totaled Euro 477 thousand. These shares will vest permanently at the end of the vesting period if the executive still has an employment relationship with the Company.
In addition, on April 24, 2023, the Shareholders' AGM approved the new stock grant plan for ordinary company shares, called the "2023-2025 Long Term Incentive Plan" (the "Plan"). The Plan is divided into three cycles (the first relating to the 2023- 2025 vesting period, the second relating to the 2024-2026 vesting period, and the third relating to the 2025-2027 vesting period) and provides for the allotment of ordinary shares of Piovan S.p.A. for each cycle. With reference to the first and second cycle, the rights were granted to managers of Piovan S.p.A., but also of its subsidiaries, and the number of rights at maturity was estimated at approximately 351,450. The total value of the first and second cycles is Euro 3,472 thousand, whereas the amounts vested at June 30, 2024 totaled Euro 1,055 thousand. These shares will vest permanently at the end of the vesting period if the executive still has an employment relationship with the Company.
The Translation reserve includes exchange rate differences arising from the translation of the opening equity of foreign companies included in the consolidation scope at the
exchange rates prevailing at the end of the period and from the translation of their net income at the average exchange rates for the period.
The item Other reserves and retained earnings mainly includes the other profit and capital reserves of the Parent Company, in addition to the consolidated profit for previous years and the effects of adjustments resulting from the adoption of international accounting standards.
[15] Equity attributable to non-controlling interests
Equity attributable to non-controlling interests at June 30, 2024 amounted to Euro 19,790 thousand, compared to Euro 2,600 thousand at December 31, 2023. The account includes the share of the non-controlling interests in the subsidiaries. FDM GmbH, FEA and NuVu.
The changes compared to December 31, 2023 were as follows:
- the change to the consolidation scope following the full consolidation of NuVu;
- the result of the subsidiaries FDM Gmbh, FEA and NuVu attributable to minority interests and amounting to a profit of Euro 625 thousand.
[16] Basic and diluted earnings per share
At June 30, 2024, the shares in circulation numbered 53,600,000 and the treasury shares held by Piovan S.p.A. amounted to 2,474,475.
Earnings per share was calculated by dividing the net profit attributable to the shareholders of the Parent Company by the weighted average number of ordinary shares in circulation during the reporting period. As mentioned in relation to the Group's equity, ordinary shares were repurchased in H1 2024. In addition, it should be noted that in the context of the 2020 - 2022 Performance Shares Plan and the 2023 - 2025 Long Term Incentive Plan, there are ordinary shares that could be assigned at the end of the vesting period, drawing on treasury shares in the portfolio and which could have a diluting effect.
The calculation of the basic earnings per share is as follows:
| Basic Earnings per share | 30.06.2024 | 30.06.2023 |
|---|---|---|
| Net Profit Attributable to Owners of the Parent (in thousands of Euros) | 27,618 | 22,610 |
| Weighted average number of ordinary shares (in thousands of units) | 51,110 | 51,024 |
| Basic earnings per share (in Euros) | 0.54 | 0.44 |
Diluted earning per share is the following:
| Diluted Earnings per share | 30.06.2024 | 30.06.2023 |
|---|---|---|
| Net Profit Attributable to Owners of the Parent (in thousands of Euros) | 27,618 | 22,610 |
| Weighted average number of ordinary shares (in thousands of units) | 51,732 | 51,428 |
| Diluted earnings per share (in Euros) | 0.53 | 0.44 |
[17] Current and non-current financial liabilities
The account is broken down as follows:
| Current financial liabilities | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Short-term bank borrowings | 1,589 | 666 |
| Current portion of long-term loans | 35,967 | 36,567 |
| Other loans and borrowings | 4,085 | 23,240 |
| Current financial liabilities | 41,641 | 60,473 |
| Non-current financial liabilities | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Medium to long-term bank loans | 75,102 | 79,624 |
| Other loans and borrowings | 15,248 | 14,497 |
| Non-current financial liabilities | 90,350 | 94,121 |
"Other current financial payables" decreased significantly following the settlement of the earnout, which was paid in April 2024, as further described in the section "Financial performance of the Group"
A breakdown by contract is provided below of "Medium to long-term bank loans" and the "Current portion of medium to long-term loans" at June 30, 2024, and December 31, 2023, as well as the main features of the bank loans by maturity:
| 30.06.2024 | 31.12.2023 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Curr. | Original amount |
Maturity | Interest rate |
Terms | Outstan ding |
Current | Non current |
Outstan ding |
Current | Non current |
| EUR | 7,000 | 03/05/2024 | Fixed | 0.54% | - | - | - | 883 | 883 | - |
| EUR | 5,000 | 05/02/2025 | Variable | Euribor 6m+0.65% | 1,000 | 1,000 | - | 1,500 | 1,000 | 500 |
| EUR | 7,000 | 07/04/2024 | Variable | Euribor 6m+0.85% | - | - | - | 875 | 875 | - |
| EUR | 20,000 | 14/10/2025 | Fixed | 0.67% | 6,000 | 4,000 | 2,000 | 8,000 | 4,000 | 4,000 |
| EUR | 4,125 | 23/12/2028 | Variable | Euribor 6m+0.6% | 2,652 | 589 | 2,063 | 2,946 | 589 | 2,357 |
| EUR | 10,000 | 22/11/2024 | Fixed | 0.25% | 1,672 | 1,672 | - | 3,342 | 3,342 | - |
| EUR | 100,000 | 21/01/2028 | Fixed | 1.34% | 75,000 | 20,000 | 55,000 | 85,000 | 20,000 | 65,000 |
| EUR | 10,000 | 20/06/2025 | Variable | Euribor 6m+0.80% | 3,458 | 3,458 | - | 5,127 | 3,377 | 1,749 |
| EUR | 10,000 | 15/05/2027 | Variable | Euribor 6m+0.75% | 7,500 | 2,500 | 5,000 | 8,750 | 2,500 | 6,250 |
| USD | 15,000 | 20/06/2029 | Fixed | SOFR 6m+1.1% | 14,012 | 2,748 | 11,264 | - | - | - |
| Total banks loan | 111,294 | 35,967 | 75,327 | 116,423 | 36,567 | 79,856 | ||||
| EUR | 741 | 30/06/2031 | Fixed | 0.18% | 658 | 93 | 564 | 704 | 93 | 611 |
| Other | 658 | 93 | 564 | 704 | 93 | 611 | ||||
| Total | 111,952 | 36,060 | 75,891 | 117,127 | 36,660 | 80,467 |
Loans are recognized at amortized cost and include arrangement expenses of Euro 225 thousand recognized as a reduction to the residual debt (Euro 232 thousand at December 31, 2023). Financial liabilities changed during the period as follows:
| Current fincial liabilities | Non current fincial liabilities | |||||||
|---|---|---|---|---|---|---|---|---|
| €/000 | S/T bank borrowing s |
Current portion of L/T loans |
Oth. loans and borrowing s |
Total current financial liabilities |
L/T term bank loans |
Oth. loans and borrowing s |
Total non current financial liabilities |
|
| 31.12.2023 | 666 | 36,567 | 23,240 | 60,473 | 79,624 | 14,497 | 94,121 | |
| Disbursements/(Refunds) | 923 | (16,386) | (22,309) | (37,772) | 11,264 | 11,264 | ||
| Change in translation reserve | 687 | 687 | 201 | 201 | ||||
| Increase/(decrease) for lease | 376 | 376 | 2,395 | 2,395 | ||||
| Reclass. from non current to current | 15,787 | 1,845 | 17,632 | (15,786) | (1,845) | (17,631) | ||
| Other | 245 | 245 | - | |||||
| 30.06.2024 | 1,589 | 35,967 | 4,085 | 41,641 | 75,102 | 15,248 | 90,350 |
As required by IFRS 7, the following table show cash flows relating to the Group's financial liabilities by maturity.
| 30.06.2024 | Total | Total flows | Within 1 year | From 2 to 5 years |
Over 5 years |
|---|---|---|---|---|---|
| Medium to long-term bank loans | 75,102 | 78,341 | 0 | 78,341 | 0 |
| Other loans and borrowings | 15,248 | 15,248 | 15,248 | ||
| Non-current financial liabilities | 90,350 | 93,589 | 0 | 93,589 | 0 |
| Short-term bank borrowings | 35,967 | 38,340 | 38,340 | ||
| Current portion of long-term loans | 1,589 | 1,589 | 1,589 | ||
| Loans for leases | 4,085 | 4,085 | 4,085 | ||
| Other loans and borrowings | 41,641 | 44,015 | 44,015 | ||
| Current financial liabilities | 75,102 | 78,341 | 0 | 78,341 | 0 |
[18] Employee benefits plans
They amount overall to Euro 5,519 thousand at June 30, 2024, compared to Euro 5,635 thousand at December 31, 2023.
The item mainly includes the liabilities for the Post-employment benefit provision recorded in the companies of the Group qualifying as defined benefit plans according to IAS 19 and thus subject to actuarial calculation.
Compared to the actuarial assumptions outlined in the Explanatory Notes to the Consolidated Financial Report at December 31, 2023, no developments occurred which would require an update to the actuarial calculation and to the underlying assumptions.
| Defined Benefit Plan | 30.06.2024 |
|---|---|
| Opening balance | 5,527 |
| Accrual | 972 |
| Employee benefits paid | (512) |
| Transfer to pension funds and INPS treasury | (643) |
| Translation changes | 2 |
| Interest cost | - |
| Actuarial reserve change | - |
| Change in area | 65 |
| Closing balance | 5,411 |
[19] Provision for risks and charges
The provision for risks and charges at June 30, 2024 amounted to Euro 5,432 thousand, compared to Euro 5,486 thousand at December 31, 2023. The composition and the movements of the item are shown in the following table:
| Provisions for risks and charges | 31.12.2023 | Change in conso area |
Accruals | Releases/ Utilizations |
Change trans. reserve |
30.06.2024 |
|---|---|---|---|---|---|---|
| Provision for legal and tax risks | 706 | - | - | - | 20 | 726 |
| Provision for product warranties | 3,015 | 192 | 47 | (49) | 76 | 3,281 |
| Provision for agents' termination benefits |
212 | - | 81 | (30) | - | 263 |
| Pension provision | 57 | - | 3 | - | - | 60 |
| Other provisions for risks | 1,497 | - | - | (390) | (4) | 1,103 |
| Provisions for risks and charges | 5,486 | 192 | 131 | (469) | 92 | 5,432 |
The provision for risks and charges at June 30, 2024 is substantially in line with the value at December 31, 2023.
The provision for legal and tax risks at June 30, 2024 mainly includes a provision set aside by the US subsidiary for a total amount of USD 420 thousand (Euro 392 thousand) against a potential liability linked to indirect taxation in various states.
The Provision for product warranty was set up to cover estimated warranty service charges to be incurred in the future, calculated on the basis of historical costs and expected costs relating to the machines and plants sold and still within the initial warranty period.
The provision for agents' termination benefits represents the estimated liability resulting from the application of current legislation and contractual clauses regarding the termination of agency relationships.
The item other risk provisions includes:
- o an estimate of the charges necessary for the relocation of Piovan Plastic Machinery to the new plant;
- o a provision for the remainder that represents the best estimate of the costs needed to fulfil existing commercial contracts (net of related economic benefits).
As outlined in greater detail in the Directors' Report, the parent company decided not to make any provision against the potential liabilities arising from the findings of the tax audit undertaken in 2023 in relation to fiscal years 2017-2022. In this regard, also on the basis of the opinion of the appointed leading independent consultants, the risk of loss is considered as not probable and of an un-estimable amount.
[20] Non-current and current liabilities for options granted to non-controlling interests
At June 30, 2024, these liabilities amounted Euro 26,174 thousand and were fully classified to non-current liabilities. This amount recognized upon the acquisition of control of Nu-Vu Conair Pvt. Ltd. includes the valuation of Put Options granted to NuVu's minority shareholders.
The contractual agreements with the selling shareholders, who as a result of the sale of 1% retained a 49% stake in the company, include a Put/Call Option mechanism for third-party shareholders to exit in two tranches to be exercised between 2029 and 2032. Specifically, the contract stipulates:
- o a "First Put /Call Option", whereby the third-party shareholders can exercise a put option and Piovan S.p.A. can exercise a call option, of the shares held by the third-party shareholders, corresponding to 24.5% of NuVu's share capital, in the period between April 1, 2029 and November 30, 2029. Where not exercised, the right for both parties lapses.
- o a "Second Put /Call Option", whereby the third-party shareholders can exercise a put option and Piovan S.p.A. can exercise a call option, of the shares held by the third-party
shareholders, corresponding to 24.5% of NuVu's share capital, in the period between April 1, 2032 and November 30, 2032. Where not exercised, the right for both parties lapses.
The sale price of the shares is determined on the exercise of the options, based on certain operating and financial parameters set out in the agreements between the parties.
In accordance with IAS 32 (paragraph 23), the liabilities were measured at fair value as of the transaction date, which is the present value of the sales price of the shares that will be determined when the options are exercised. The discount rate used was approximately 3.86%.
These options have been recognized as a balancing entry in Group equity, in view of the fact that the risks and benefits on the remaining 49% stake remain with the minority interests. The Group also continues to recognize the minority interests in the result for the year and in shareholders' equity until the put option is exercised.
Subsequent changes in the fair value of the liability are recognized in the statement of profit and loss.
The book value of the liabilities for put options described above represent the best estimate, at each reference date, of their present value. It should be noted that the conditions on the basis of which these liabilities exist, as well as their valuation made in accordance with contractual provisions, are based on estimated future forecasts of economic and financial parameters, therefore the above estimates and assumptions may differ from the historical figures reported in the financial statements due to the inherent uncertainty that characterizes the assumptions and conditions on which these estimates are based.
With regard to the subsidiary FDM, the minority shareholder of the latter holds a put option on its share (33.33%). This option has not been measured as it is subordinate to actions that the Parent Company must implement and therefore under the control of the latter.
[21] Other non-current liabilities
At June 30, 2024, these amounted to Euro 816 thousand compared to Euro 2,500 thousand at December 31, 2023, and are represented by non-current tax payables of the subsidiaries Piovan Do Brasil and Piovan Plastic Machinery. At December 31, 2023, payables to staff included incentive plans to staff reclassified under other current liabilities.
| €/000 | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Payables to employees | (0) | 1,759 |
| Tax payables | 816 | 741 |
| Other non current liabilities | 816 | 2,500 |
[22] Trade payables
They amounted to Euro 64,977 thousand at June 30, 2024, compared to Euro 71,668 thousand at December 31, 2023. The movement in this item to June 30, 2024 mainly derives from the reduction in the timing of payments.
[23] Advances from customers
At June 30, 2024, Advances from customers amounted to Euro 30,668 thousand, compared to Euro 37,445 thousand at December 31, 2023. This item refers to advances received by customers and relating to contracts where performance obligations are met at a point in time.
[24] Tax liabilities and social security contributions
They amount to Euro 12,014 thousand at June 30, 2024, compared to Euro 11,388 thousand at December 31, 2023. The account is broken down as follows:
| €/000 | 30.06.2024 | 31.12.2023 | |
|---|---|---|---|
| Social security contributions | 3,825 | 4,372 | |
| VAT liabilities | 2,190 | 2,954 | |
| Tax withholdings for employees | 2,105 | 1,910 | |
| Income tax liabilities (IRES and IRAP) | 3,894 | 2,152 | |
| Tax liabilities and social security contributions | 12,014 | 11,388 |
[25] Other current liabilities
They amounted to Euro 32,146 thousand at June 30, 2024, compared to Euro 27,122 thousand at December 31, 2023. The account is broken down as follows:
| €/000 | 30.06.2024 | 31.12.2023 |
|---|---|---|
| Payables to employees | 21,397 | 18,428 |
| Payables to parent company | 2,895 | 410 |
| Accrued income and deferred expense | 4,527 | 4,386 |
| Other payables | 3,327 | 3,898 |
| Other current liabilities | 32,146 | 27,122 |
Employee payables refer to wages and salaries and accruals for vacation and leave accrued, in addition to the current portion of monetary incentive plans. Payables to parent companies refer to the parent company Piovan S.p.A. and the subsidiaries Penta S.r.l. and Aquatech S.r.l. and concern estimated current taxes based on the performance for the period in accordance with the tax consolidation contract in place with the parent company, Pentafin S.p.A. Accruals and deferred income include accrued expenses for the period and deferred income related to future periods.
Explanatory Notes to the Consolidated Statement of Profit and Loss
With regards to all statement of profit and loss items, the first half of 2024, whose figures are presented for comparative purposes, only include operations for 5 months of NuVu.
[26] Revenues
Revenues amounted to Euro 281,869 thousand in H1 2024, compared to Euro 285,437 thousand in H1 2023, a decrease of 1.3%. Revenues are shown net of discounts and rebates.
In order to provide adequate disclosure a breakdown of revenues by market and region is provided below. This breakdown is the analysis regularly monitored by Group Management.
The breakdown of revenue by market is as follows:
| €/000 | First half year 2024 (*) |
% | First half year 2023 |
% | Change | Change % |
|---|---|---|---|---|---|---|
| Technical Polymers | 214,012 | 75.9% | 223,531 | 78.3% | (9,519) | (4.3%) |
| Food & Industrial Application | 23,309 | 8.3% | 18,599 | 6.5% | 4,710 | 25.3% |
| Services | 44,548 | 15.8% | 43,307 | 15.2% | 1,241 | 2.9% |
| Revenue | 281,869 | 100.0% | 285,437 | 100.0% | (3,568) | (1.3%) |
(*)NuVu has been included in the consolidation scope as of February 1, 2024.
Part of the revenue of the Technical Polymers Systems and the Food and Industrial Applications Systems markets derive from contracts with customers where the performance obligations, as well as the recognition of the related revenues, are met over time, as described in the section "Accounting policies" of the Annual Financial Report at December 31, 2023. The above revenue category totaled Euro 20,104 thousand for the first six months of 2024 (Euro 14 million in H1 2023). This revenue mainly relates to the subsidiaries Penta S.r.l., FEA S.r.l. and Pelletron Corp., part of the IPEG Group.
| €/000 | First half year 2024 (*) |
% | First half year 2023 |
% | Change | Change % |
|---|---|---|---|---|---|---|
| EMEA | 93,227 | 33.1% | 94,127 | 33.0% | (900) | (1.0%) |
| ASIA | 32,622 | 11.6% | 32,637 | 11.4% | (15) | 0.0% |
| NORTH AMERICA | 147,455 | 52.3% | 148,814 | 52.1% | (1,359) | (0.9%) |
| SOUTH AMERICA | 8,565 | 3.0% | 9,859 | 3.5% | (1,294) | (13.1%) |
| Revenue | 281,869 | 100.0% | 285,437 | 100.0% | (3,568) | (1.3%) |
The breakdown of revenue by geographical area is as follows:
(*) NuVu has been included in the consolidation scope as of February 1, 2024.
Revenues in EMEA include revenue in Italy which amounted to Euro 22,570 thousand in the first six months of 2024 and Euro 26,906 thousand in the first six months of the previous year.
For further information, reference should be made to the "Group operating performance" section.
[27] Other Revenues and Income
Other revenues amounts to Euro 5,583 thousand, increasing Euro 888 thousand compared to the first six months of 2023 and which break down as follows:
| €/000 | First half-year 2024 | First half-year 2023 |
|---|---|---|
| Accessory transport services for sales | 3,939 | 3,280 |
| Machinery leases | 24 | 28 |
| Grants | 4 | 417 |
| Contingency | 651 | 472 |
| Gains for disposal of tangible and intangible assets | 117 | 33 |
| Insurance compensation | 2 | 3 |
| Agency commissions | 37 | 18 |
| Increase in fixed assets for internal works | 3 | - |
| Other | 806 | 444 |
| Other revenues and income | 5,583 | 4,695 |
Accessory transport services for sales mainly refers to revenues from transport ancillary services related to sales transactions with customers.
Machinery leases refers to income from the rental of assets produced internally generally for demonstration purposes or for the time until delivery of the system ordered by the customer.
Grants related to income are mainly represented by grants for research and development of Piovan S.p.A.
Other Revenues mainly includes recharges and penalties applied to customers.
[28] Costs of raw materials, components, goods and changes in inventories
This item amounted to Euro 123,976 thousand in the first six months of 2024, compared to Euro 130,479 thousand in the first six months of the previous year. This item is broken down as follows:
| €/000 | First half-year 2024 | First half-year 2023 |
|---|---|---|
| Costs of raw materials, components and goods | 124,811 | 121,530 |
| Costs of consumables | 4,533 | 6,280 |
| Change in raw materials and goods | (6,779) | 1,336 |
| Change in finished goods and semi-finished products | 1.410 | 1,333 |
| Costs of raw materials, components and goods and changes in inventories | 123,976 | 130,479 |
The account decreased compared to the first half of the previous year by approximately 5%. This accounted for 45.0% of Total revenue and income in the first half of 2023 and 43.1% in the first half of 2024.
[29] Services
Services amounted to Euro 53,695 thousand in the first half of 2024, compared with Euro 53,905 thousand in 2023.
| €/000 | First half-year 2024 | First half-year 2023 |
|---|---|---|
| Outsourcing | 15,898 | 17,848 |
| Transport | 8,089 | 7,822 |
| Business trips and travel | 4,062 | 3,476 |
| Agency commissions | 7,436 | 8,563 |
| Fees to directors, statutory auditors and independent auditors | 1,190 | 1,085 |
| Consultancies | 3,195 | 3,036 |
| Maintenance and repairs | 2,954 | 2,331 |
| Marketing and advertising | 2,898 | 2,046 |
| Utilities | 1,316 | 1,408 |
| Insurance | 1,274 | 609 |
| Telephone and connections | 514 | 494 |
| Other costs for services | 2,667 | 3,550 |
| Rental expenses | 1,320 | 875 |
| Leases | 79 | 88 |
| Hires | 803 | 674 |
| Services | 53,695 | 53,905 |
| of which non-recurring | 589 | 219 |
| Costs for services excluding non-recurring services | 53,106 | 53,686 |
The item is substantially in line with the first half of the previous year. This accounted for 18.6% of Total revenue and income in the first half of 2023 and 18.7% in the first half of 2024.
The main cost accounts also from an industrial process viewpoint refer to:
- outsourcing costs amounting to Euro 15,898 thousand in the first half of 2024 (29.6% of total Service costs) determined by the production methods of the Group, which concentrates internally processing and high value added and core activities. In H1 2023, this item amounted to Euro 17,848 thousand (33.1% of total Service Costs). This change relates to the a different product mix and sales trends in North America compared to other countries.
- transport costs on purchases and sales, which totaled Euro 8,089 thousand in H1 2024, equal to 15.1% of service costs, compared to 14.5% in H1 2023. The change was due to different mix of sales conditions;
- business trips and travel relating to both commercial activities and customer relations, and travel to customers' production sites to carry out installation and start-up and customer assistance;
- commission costs, which totaled Euro 7,436 thousand in H1 2024, equal to 13.8% of service costs, compared to 15.9% in H1 2023. The change is due to the movement in sales volumes and a different sales mix.
Rent, lease and similar costs include costs related to rental agreements that do not meet the characteristics for the application of IFRS 16.
[30] Personnel expenses
Personnel expenses amounted to Euro 69,816 thousand, compared with Euro 65,989 thousand in the first half of 2023. A breakdown of personnel expenses is provided below:
| €/000 | First half year 2024 |
First half year 2023 |
|---|---|---|
| Wages and salaries | 53,857 | 51,523 |
| Social security contributions | 13,726 | 9,614 |
| Costs for defined benefit plans | 1,022 | 891 |
| Other expenses | 1,211 | 3,961 |
| Personnel expenses | 69,816 | 65,989 |
The item increased on the first half of the previous year by approximately 5.8%. The increase is partly due to the inclusion of NuVu in the scope of consolidation and mainly to increases in national collective bargaining agreements in Italy, besides to the share of bonuses and incentive plans for the year.
This accounted for 24.3% of Total revenue and income in the first half of 2023 and 22.7% in the first half of 2024, recording a small improvement.
The breakdown of the workforce compared to H1 2023 is presented below:
| First half-year 2024 | First half-year 2023 | |||
|---|---|---|---|---|
| period end | average | period end | average | |
| Executives | 77 | 78 | 42 | 41 |
| Middle Managers | 143 | 139 | 116 | 115 |
| White collars | 1,172 | 1,165 | 1,040 | 1,038 |
| Blue collars | 663 | 672 | 595 | 602 |
| Total | 2,055 | 2,053 | 1,793 | 1,795 |
[31] Other expenses
This item amounted to Euro 1,728 thousand, compared with Euro 2,301 thousand in the previous year. This item is broken down as follows:
| €/000 | First half year 2024 |
First half year 2023 |
|---|---|---|
| Other taxes and duties | 611 | 527 |
| Losses from the sale of tangible fixed assets | - | - |
| Bad debt provision | 385 | 386 |
| Entertainment costs | 194 | 185 |
| Provision for legal and tax risks | (81) | 191 |
| Provision for product warranty | 47 | 360 |
| Provision for additional client expenses | 74 | 9 |
| Other | 498 | 643 |
| Other expenses | 1,728 | 2,301 |
Other taxes and duties mainly includes indirect taxes on property and local taxes related to operations in the various countries and in particular with regard to the newly acquired group in the United States, to the parent company in Italy, and to the other shareholdings in Brazil and in the United States.
[32] Amortizations and depreciation
This item amounted to Euro 7,613 thousand, compared with Euro 6,886 thousand in the previous year. This item is broken down as follows:
| €/000 | First half-year 2024 |
First half-year 2023 |
|---|---|---|
| Amortisation | 3,332 | 2,610 |
| Depreciation | 2,323 | 2,204 |
| Right of use depreciation | 1,958 | 2,072 |
| Depreciation & amortisation | 7,613 | 6,886 |
The amount increased in first half of 2024 because the amortization of intangibles recognized provisionally for NuVu PPA (customer list and backlog) for 714 thousand euro.
[33] Financial income and expenses
The account presented net expenses of Euro 462 thousand in H1 2024, compared to net expenses of Euro 863 thousand in H1 2023. This item is broken down as follows:
| €/000 | First half-year 2024 |
First half-year 2023 |
|---|---|---|
| Interest income | 1,091 | 482 |
| Income on financial assets | 152 | 136 |
| Other financial income | 71 | 265 |
| Financial income | 1,314 | 883 |
| Bank interest expenses | 1,263 | 1,143 |
| Other interest expenses | 196 | 246 |
| Other financial expenses | 317 | 357 |
| Financial expense | 1,776 | 1,746 |
| Net financial income (charges) | (462) | (863) |
Financial income is mainly attributable to the Parent Company, Ipeg Inc. and NuVu, and includes interest income on deposits and on bonds, which increased compared to H1 2023 as a result of more effective management of liquidity.
[34] Net exchange rate gains/(losses)
The item reports a net gain of Euro 457 thousand in H1 2024, compared to a net loss of Euro 639 thousand in H1 2023. This item is broken down as follows:
| €/000 | First half year 2024 |
First half year 2023 |
|---|---|---|
| Exchange rate gains | 2,929 | 4,070 |
| Exchange rate losses | (2,472) | (4,709) |
| Net exchange rate gain (losses) | 457 | (639) |
Unrealized foreign exchange gains included under Foreign exchange gains amounted to Euro 2,008 thousand in first six months 2024 (68.5% of foreign exchange gains for the period) and
Euro 2,914 thousand in the first six months of 2023 (71.6% of foreign exchange gains for the period).
Unrealized foreign exchange losses included under Foreign exchange losses amounted to Euro 1,310 thousand in the first six months of 2024 (53.0% of foreign exchange losses for the period) and Euro 3,614 thousand in the first six months of 2023 (76.8% of foreign exchange losses for the period).
The change on H1 2023 is mainly attributable to the IPEG group and to Piovan do Brasil, as well as to the trends in the US dollar and Brazilian real against the Euro.
[35] Gains/(losses) on liabilities for option granted to non-controlling interests
There are no updates regarding the assessment made at the initial subscription and first consolidation of NuVu. For further details, reference should be made to Note [20].
The liabilities for option granted to non-controlling interests refer, as at 30 June 2024, uniquely to the put options of NuVu's third-party shareholders, as better described in note [20]. With reference to this liability, there were no movements in the period between February and June 2024 regarding the assessment performed at the initial recognition.
[36] Profits/(Losses) from equity investments carried at equity
The item reports a net gain of Euro 6,792 thousand in H1 2024 (Euro 1,136 thousand in H1 2023), and mainly includes the revaluation at fair value of the holding initially held in NuVu (50%), which subsequently entered the consolidation scope. Reference should be made to note [4] for further information.
[37] Profits/(losses) from disposals
In 2023, this included the income attributable to the Group from the sale of the investment in Toba PNC and consequent loss of a controlling interest.
[38] Income Taxes
This item amounted to Euro 9,168 thousand in the first six months of 2024 compared to Euro 9,703 thousand in the first six months of 2023. Income taxes have been determined taking into account the best estimate of the average annual tax rate expected for the whole year.
| €/000 | First half-year 2024 |
First half-year 2023 |
|---|---|---|
| Current tax liabilities | 9,701 | 9,557 |
| Deferred/advance taxes | (425) | (70) |
| Previous years' taxes | (109) | 217 |
| Income taxes | 9,168 | 9,703 |
Other information
Non-recurring items
Consob Communication no. DEM/6064293 of July 28, 2006 requires information on significant events and transactions whose occurrence is non-recurring or on transactions or events that do not occur frequently in the normal course of business.
Non-recurring income relates to non-exceptional income items.
IN H1 2024 and H1 2023, the following non-recurring expenses and income were identified.
| €/000 | First half year 2023 |
|
|---|---|---|
| Non-recurring items related to acquisitions, reorganisations and integration processes | (589) | (198) |
| Income from the sale of Toba | - | 1,337 |
| Income from acquisition of NuVu's control (revaluation at fair value of previously held interest) | 6,393 | - |
| Exchange effect of NuVu acquisition | (475) | - |
| Non-recurring expenses related to Chinese plant | (21) | |
| Total | 5,329 | 1,118 |
Incentive Plans
On May 12, 2020, the Shareholders' AGM of the Parent Company approved three medium/longterm incentive plans, which aim to retain and incentivize those beneficiaries who are key players in achieving the Group's objectives. This will align the remuneration of these beneficiaries with increases in value and return on shareholder investment.
The first plan, called the "2020-2022 Performance Shares Plan", stipulates that the beneficiaries are identified from among the Executive Directors, excluding the Executive Chairperson, and the Senior Executives at the Piovan Group companies, providing for the free allocation of Piovan S.p.A. shares already held by the Company. The first cycle of this first plan came to a close in 2022, and in January 2023, 93,255 shares, representing all of the shares planned, were assigned to plan participants.
The second, called the "2020-2022 Long-Term Monetary Incentive Plan", establishes that the beneficiaries are identified from among the Executives and employees or collaborators at the Piovan Group's companies, providing for monetary incentives. The plans commenced from their approval by the Shareholders' AGM and conclude on December 31, 2022, comprising three rolling cycles (vesting periods), each of three years, with the last period concluding in 2024. The vesting periods concern periods on the conclusion of which the shares of the company, or a monetary incentive, shall be granted or issued to beneficiaries, on verification of the achievement for each cycle of the performance objectives linked to the Group's sales volumes and consolidated EBITDA by the Board of Directors and within the limits and according to the means indicated in the respective regulations and disclosure documents. The first cycle of this second plan came to a close in 2022, and the amounts due will be paid in 2023.
The third plan, called the "2020-2022 Phantom Stock Option Plan", is for the Executive Directors and Senior Executives at Piovan Group's companies. This is a long-term plan divided into three cycles (also known as "Vesting Periods"), each lasting three years. The Vesting Periods are the periods at the end of which it is possible to request payment of the incentive. The duration of the Phantom Stock Option Plan, therefore, is from the date of the plan's approval by the Ordinary Shareholders' AGM until the date the incentive is paid. This will be in 2025, while the last Vesting Period will end on December 31, 2024. The first cycle of this third plan came to a close in 2022, and the amounts due will be paid in 2023.
Finally, on April 24, 2023, the Shareholders' AGM approved the new stock grant plan for ordinary company shares, called the "2023-2025 Long Term Incentive Plan". This new plan is divided into three cycles (the first covering the 2023- 2025 vesting period, the second covering the 2024- 2026 vesting period, and the third covering the 2025-2027 vesting period). Beneficiaries of the plan are individually identified by the Board of Directors, upon the proposal of the Chairperson of the Board of Directors, and having heard the opinion of the Nomination and Remuneration Committee, as the Executive Directors (excluding the Executive Chairperson) and the Senior Executives (as formally identified), with additional beneficiaries identified by the Chairperson of the Board of Directors from among the employees and/or collaborators of the Company or Subsidiaries due to the strategic importance of the roles, as follows:
- by December 31, 2023 for the First Cycle;
- by December 31, 2024 for the Second Cycle;
- by December 31, 2025 for the Third Cycle;
The allocation of the Initial Rights will take place free of charge, with the relevant Beneficiaries not required to pay any consideration to the Company for such allocation.
Initial rights will be allocated based on performance rights (90%), linked to the achievement of certain Group targets, and retention rights (10%), linked to continued employment. Performance Rights may accrue in a range from 0 to approximately 120% of the Initial Rights. The Performance Goals for each Cycle are set by the Board of Directors, after consultation with the Nomination and Remuneration Committee, in accordance with the provisions of the Plan, and communicated to each Beneficiary, for the First Cycle, indicatively by June 30 of each year, and for each subsequent Plan Cycle indicatively by March 31 of the first year of that Plan Cycle. Performance targets are based on both "market conditions" and "non-market conditions". Furthermore, it is underlined that the Plan's goals include objectives related to ESG topics.
Classes of financial instruments and fair value hierarchy
With reference to the breakdown of financial assets and liabilities required by IFRS 7, there were no transfers between the fair value levels indicated in IFRS 13 and those reported in the Annual Financial Report at December 31, 2023, to which reference should be made for further information.
| 30.06.2024 | IFRS 9 categories | Book value |
Level 1 | Level 2 | Level 3 |
|---|---|---|---|---|---|
| Current accounts and post office deposits | Receivables and loans | 63,513 | 63,513 | ||
| Cash equivalent | Receivables and loans | 12,330 | 12,330 | ||
| Cash | Receivables and loans | 73 | 73 | ||
| Cash and cash equivalents | 75,916 | 75,916 | |||
| Trade receivables | Receivables and loans | 77,960 | 77,960 | ||
| Financial assets | |||||
| Total financial assets | 153,876 | 75,916 | 77,960 | ||
| Bank borrowings | Liabilities at amortised cost | 75,102 | 75,102 | ||
| Payables to other lenders | Liabilities at amortised cost | 15,248 | 15,248 | ||
| Non-current financial liabilities | 90,350 | 90,350 | |||
| Short-term bank loans | Liabilities at amortised cost | 1,589 | 1,589 | ||
| Short-term bank loans | Liabilities at amortised cost | 35,967 | 35,967 | ||
| Payables to other lenders | Liabilities at amortised cost | 4,085 | 4,085 | ||
| Current financial liabilities | 41,641 | 41,641 | |||
| Trade payables | Liabilities at amortised cost | 64,977 | 64,977 | ||
| Advances from customers | Liabilities at amortised cost | 30,668 | 30,668 | ||
| Liabilities for commitments and put options | Liabilities at fair value | 26,174 | 26,174 | ||
| Total financial liabilities | 253,810 | 131,991 | 121,819 |
| 31.12.2023 | IFRS 9 categories | Book value |
Level 1 | Level 2 | Level 3 |
|---|---|---|---|---|---|
| Current accounts and post office deposits | Receivables and loans | 79,246 | 79,246 | ||
| Cash equivalent | Receivables and loans | 13,500 | 13,500 | ||
| Cash | Receivables and loans | 39 | 39 | ||
| Cash and cash equivalents | 92,785 | 92,785 | |||
| Trade receivables | Receivables and loans | 79,979 | 79,979 | ||
| Financial assets | Receivables and loans | 6,556 | 6,556 | ||
| Total financial assets | 179,320 | 6,556 | 92,785 | 79,979 | |
| Bank borrowings | Liabilities at amortised cost | 79,624 | 79,624 | ||
| Payables to other lenders | Liabilities at amortised cost | 14,497 | 14,497 | ||
| Non-current financial liabilities | 94,121 | 94,121 | |||
| Short-term bank loans | Liabilities at amortised cost | 666 | 666 | ||
| Short-term bank loans | Liabilities at amortised cost | 36,567 | 36,567 | ||
| Payables to other lenders | Liabilities at amortised cost | 23,240 | 23,240 | ||
| Current financial liabilities | 60,473 | 60,473 | |||
| Trade payables | Liabilities at amortised cost | 71,668 | 71,668 | ||
| Advances from customers | Liabilities at amortised cost | 37,445 | 37,445 | ||
| Liabilities for commitments and put options | Liabilities at fair value | ||||
| Total financial liabilities | 263,707 | 154,594 | 109,113 |
Segment disclosure
IFRS 8 requires that disclosures regarding operating segments be prepared in such a way as to provide the information necessary to assess the nature and effects on the financial statements of business activities and operating environments. As indicated in the Annual Financial Report at December 31, 2023, this is done based on internal reporting and operating activities that generate revenues and costs, whose results are reviewed periodically by the chief operating decision-maker in order to make decisions about resources to be allocated and to assess performance; operating segments were not identified other than the Group as a whole.
The disclosures also required for entities that have a single segment to report on products sold and services provided and geographical areas are provided in note [26].
Related party transactions
During 2023 and 2024, the Group had commercial relations with some related parties of the Group.
In accordance with the provisions of IAS 24, the following entities are considered Related Parties: (a) companies that directly or indirectly through one or more intermediate companies, control, or are controlled or are under common control with the reporting entity; (b) associated companies; (c) natural persons who directly or indirectly have voting power in the reporting entity that gives them a dominant influence over the company and their immediate family members; (d) key management personnel, i.e. those who have the power and responsibility for planning, directing and controlling the activities of the reporting entity, including directors and officers of the company and the immediate family members of such persons; (e) companies in which any natural person described under (c) or (d) has, directly or indirectly, significant voting power, or over which such person has such power. Case (e) includes undertakings owned by the directors or major shareholders of the reporting entity and undertakings which have a manager with strategic responsibilities in common with the reporting entity. All transactions are regulated at market conditions for goods and services of equal quality.
| Tra ctio t 30 .06 .20 24 nsa ns a |
of Nat ctio tra ure nsa ns |
Pro ty per Pla nt & Equ ipe me nd nt a IFR S16 |
Cur t ren de tra eiv abl rec es |
Oth er t cur ren ets ass |
Adv anc es |
de pay Tra abl e |
t fina Cur ren l liab ncia iliti es |
Non - t fina cur ren l liab ncia iliti es |
Oth er non - t liab cur ren iliti es |
Oth er cur t liab ren iliti e s |
Rev enu es |
Exp ens es |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| tafi Pen n S .p.A |
Piov S.p .A. ent an par co mp any |
1 | 2.8 95 |
|||||||||
| CM G S .p.A |
ted Ass ocia co mp any |
424 | 10 | 1.1 18 |
||||||||
| Pen ta A Fe edi Ind ia L td. uto ng |
Sub sidi ary |
3 | 4 | 31 | ||||||||
| ola Nic Pio van |
Cha irm of t he of Piov S.p .A. and BoD an an Sol e sh hol der of tafi Pen n S .p.A are |
126 | 9 | 50 | 93 | 54 | 653 | |||||
| Filip Zup pic hin po |
Chi ef e ffic nd sha reh old f utiv xec e o er a er o Piov S.p .A. an |
5 | 5 | 1.2 24 |
835 | |||||||
| mb of B (ex esid Me oD t Pr ent ers cep and the O) CE |
Dire cto rs |
51 | 90 | |||||||||
| TOT ALE |
131 | 4 | 9 | 4 | 424 | 55 | 93 | 4.2 25 |
41 | 2.6 95 |
| ctio Tra t 31 .12 .20 23 nsa ns a |
of ctio Nat tra ure nsa ns |
Pro ty per Pla nt & ipe Equ me n d t an IFR S16 |
Cur t ren de tra abl eiv rec es |
Oth er t cur ren ets ass |
Adv anc es |
de pay Tra abl e |
Cur t fina ren l liab ncia iliti es |
Non nt fina -cu rre l liab ncia iliti es |
Oth er cur t liab ren iliti es |
Oth er n on- t liab cur ren iliti es |
Rev enu es |
Exp ens es |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Pen tafi n S .p.A |
Piov S.p .A. ent an par co mp any |
1 | 410 | |||||||||
| CM G S .p.A |
ted Ass ocia co mp any |
600 | 8 | 2,9 93 |
||||||||
| edi Ind td. Pen ta A Fe ia L uto ng |
Sub sidi ary |
72 | 8 | 36 | ||||||||
| Con air . Ltd Nu- Vu Pvt |
Sub sidi ary |
126 | 1,0 76 |
|||||||||
| ola Nic Pio van |
Cha of t he of and le irm BoD Piov S.p .A. So an an sha reh old f Pe fin S.p .A. nta er o |
157 | 11 | 50 | 118 | 57 | 1,30 6 |
|||||
| Filip Zup pic hin po |
Chi ef e ffic nd sha reh old f utiv xec e o er a er o Piov S.p .A. an |
11 | 11 | 605 | 364 | 1,6 50 |
||||||
| mb of B (ex esid Me oD t Pr ent ers cep and the O) CE |
Dire cto rs |
55 | 175 | |||||||||
| TOT AL |
168 | 199 | 11 | 608 | 61 | 118 | 1,1 27 |
364 | 1,1 20 |
6,1 23 |
| Tra ctio t 30 .06 .20 23 nsa ns a |
of Nat ctio tra ure nsa ns |
Pro ty per Pla nt & Equ ipe nt me and IFR S16 |
Cur t ren de tra eiv abl rec es |
Oth er t cur ren ets ass |
Adv anc es |
de pay Tra abl e |
t fina Cur ren l liab ncia iliti es |
Non nt fina -cu rre l liab ncia iliti es |
Oth er non - t liab cur ren iliti es |
Oth er cur t liab ren iliti es |
Rev enu es |
Exp ens es |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| tafi Pen n S .p.A |
Piov S.p .A. ent an par co mp any |
1 | 2,0 29 |
|||||||||
| CM G S .p.A |
ted Ass ocia co mp any |
6 | 446 | 8 | 1,30 2 |
|||||||
| edi Ind td. Pen ta A Fe ia L uto ng |
Sub sidi ary |
74 | 13 | |||||||||
| Nic ola Pio van |
Cha irm of t he of Piov S.p and So le BoD .A. an an sha reh old f Pe fin S.p .A. nta er o |
188 | 50 | 143 | 54 | 643 | ||||||
| Filip hin Zup pic po |
Chi ef e ffic nd sha reh old f utiv xec e o er a er o Piov S.p .A. an |
17 | 13 | 4 | 261 | 442 | 574 | |||||
| mb of B (ex esid Me oD t Pr ent ers cep and the O) CE |
Dire cto rs |
34 | 91 | |||||||||
| TOT AL |
205 | 81 | 446 | 63 | 148 | 261 | 2,5 59 |
21 | 2,6 09 |
85
Commitments and risks
At June 30, 2024, the Group provided guarantees to third parties as indicated below:
- Euro 11,328 thousand for guarantees in favor of third party customers against advances received for contract work-in-progress;
- Euro 10 thousand for guarantees in favor of third parties of the Parent Company Piovan S.p.A..
At June 30, 2024, the parent company Piovan S.p.A. provided financial guarantees in favor of credit institutions in the interest of subsidiaries for a total of Euro 30,453 thousand, out of which Euro 22,000 thousand are given to a credit institution on behalf of Pelletron Corp, which used Euro 6,190 thousand guaranteeing customers against advances received for contracts sales in progress.
In addition, commitments related to lease agreements that are not recognized as liabilities in accordance with IFRS 16 total approximately Euro 4,402 thousand.
Contingent liabilities and contingent assets
We are not aware of the existence of further disputes or proceedings that are likely to have significant repercussions on the Group's economic and financial situation besides what has already been stated in the note commenting on the item Provisions for risks and charges (Note [19]).
We are not aware of any contingent assets of significance to the Group's financial performance or standing.
Remuneration paid to Directors and Statutory Auditors
The remuneration of the Directors, Statutory Auditors and other Senior Executives for the first half of 2024 compared with the first half of 2023 is presented below:
| €/000 | First half-year 2024 | First half-year 2023 |
|---|---|---|
| Directors | 1.370 | 1.009 |
| Managers with strategic responsibilities | 964 | 524 |
| Statutory auditors | 28 | 28 |
List of investments included in the consolidated financial statements and other investments
The table below lists the companies in which the Parent Company has a direct or indirect interest, together with the disclosures required by law for the preparation of consolidated financial statements.
| Share capital at | Shares held | Consolid | |||||
|---|---|---|---|---|---|---|---|
| Company name | Registered office | Country | Currency | 30/06/2024 | % shareholding | Shareholder | ation |
| Parent: | Partner | method | |||||
| Piovan S.p.A. | Santa Maria di Sala | Italy | EUR | 6,000,000 | |||
| Equity investments in subsidiary companies: | |||||||
| Piovan India Private Ltd | Mumbai | India | INR | 350,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Plastics Machinery Ltd |
Suzhou (CN) | Cina | CNY | 5,088,441 | 100,00% | Piovan S.p.A. | Full |
| Piovan Do Brasil Ltda | Osasco (BRA) | Brasile | BRL | 11,947,356 | 100,00% | Piovan S.p.A. | Full |
| Piovan Mexico S. A. | Queretaro (MX) | Messico | MXN | 706,540 | 100,00% | Piovan S.p.A. | Full |
| Piovan Central Europe GmbH |
Brunn am Gebirge (A) | Austria | EUR | 35,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan UK Ltd | Bromsgrove (GB) | Regno Unito | GBP | 25,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Czech Republic s.r.o. |
Praga (CZ) | Repubblica Ceca | CZK | 200,000 | 100,00% | Piovan Central Europe GmbH (90%) Piovan S.p.A. (10%) |
Full |
| Piovan France Sas | Chemin du Pognat (F) | Francia | EUR | 1,226,800 | 100,00% | Piovan S.p.A. | Full |
| Universal Dynamics Inc. | Fredericksburg, Virginia (U.S. A.) | USA | USD | 3,500,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan GmbH | Garching (D) | Germania | EUR | 102,258 | 100,00% | Piovan S.p.A. | Full |
| Piovan Canada Ltd Piovan Asia Pacific Ltd |
Mississauga - Ontario (CAN) Bangkok (TH) |
Canada Tailandia |
CAD THB |
10 8,010,000 |
100,00% 100,00% |
Piovan S.p.A. Piovan S.p.A. |
Full Full |
| FDM GmbH | Troisdorf (DE) | Germania | EUR | 75,000 | 66,67% | Piovan S.p.A. | Full |
| Piovan Muhendslik Ltd | Beikoz (TR) | Turchia | TRY | 10,000 | 100,00% | Piovan S.p.A. | Full |
| Penta S.r.l. | Ferrara (IT) | Italia | EUR | 100,000 | 100,00% | Piovan S.p.A. | Full |
| Energys S.r.l. | Venezia (IT) | Italia | EUR | 10,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Japan Inc. | Kobe (J) | Giappone | JPY | 6,000,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Gulf FZE | Dubai (UAE) | Emirati Arabi | AED | 1,000,000 | 100,00% | Piovan S.p.A. | Full |
| Aquatech S.r.l. | Venezia (IT) | Italia | EUR | 40,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Vietnam Company Ltd |
Mai Chi Tho (Vietnam) | Vietnam | VND | 1,136,500,000 | 100,00% | Piovan S.p.A. | Full |
| Piovan Hungary Kft | Budapest | Ungheria | HUF | 3,000,000 | 100,00% | Piovan Central Europe GmbH |
Full |
| Piovan Maroc Sarl. AU | Kenitra | Marocco | MAD | 1,000,000 | 100,00% | Piovan S.p.A. | Full |
| FEA Process&Technological Plants S.r.l. |
Scarnafigi (CN) | Italia | EUR | 20,400 | 68,17% | Piovan S.p.A. | Full |
| CMG America Inc. | Clio | Michigan | USD | 70,000 | 100,00% | Piovan S.p.A. | Equity method |
| Doteco S.p.A. | Modena (IT) | Italia | EUR | 1,000,000 | 100,00% | Piovan S.p.A. | Full |
| Doteco INC | Dalton, Georgia (U.S.A.) | USA | USD | 75,000 | 100,00% | Doteco S.p.A. | Full |
| Piovan North America Llc | Delaware (USA) | USA | USD | 67,456,750 | 100,00% | Piovan S.p.A. | Full |
| IPEG Holdings Inc. | Delaware (USA) | USA | USD | 14,389,211 | 100,00% | Piovan North America Llc |
Full |
| IPEG Inc. | Franklin, Pennsylvania (USA) Pinconning, Michigan (USA) |
USA | USD | 4,501,645 | 100,00% | IPEG Holdings Inc. | Full |
| Republic Machine Inc. | Kentucky (USA) | USA | USD | 100 | 100,00% | IPEG Inc. | Full |
| Thermal Care Inc. | Illinois (USA) | USA | USD | 1,000 | 100,00% | IPEG Inc. | Full |
| Pelletron Corp. | Pennsylvania (USA) | USA | USD | 1,000 | 100,00% | IPEG Inc. | Full |
| Conair Mexicana S.A. de C.V. |
Guadalupe (Mexico) | Messico | MXN | 52,739,210 | 100,00% | IPEG Inc. | Full |
| International Plastics Equipement Group S.A. de C.V. |
Guadalupe (Mexico) | Messico | MXN | 50,000 | 100,00% | IPEG Inc. | Full |
| Pelletron Europe GmbH | Bodnegg (Germany) | Germania | EUR | 25,000 | 100,00% | IPEG Inc. | Full |
| Conair Pacific Equipement Pte Ltd |
(Singapore) | Singapore | SND | 10,000 | 100,00% | IPEG Inc. | Full |
| Conair Trading (Shangai) Co Ltd |
Shangai (China) | Cina | CNY | 0 | 100,00% | IPEG Inc. | Full |
| Conair Asia Pte Ltd | (Singapore) | Singapore | SND | 10,000 | 100,00% | IPEG Inc. | Full |
| Conair Asia Pte Ltd | Taiwan | Taiwan | TWD | 17,900,000 | 100,00% | IPEG Inc. | Full |
| Piovan Industrial Automation (Suzhou) Co., Ltd. |
Suzhou (Cina) | Cina | CNY | 40,000,000 | 100,00% | Piovan S.p.A. | Full |
| PT Piovan Technology Indonesia |
Giacarta (Indonesia) | Indonesia | ID | 1,000,100,000 | 99,00% 1,00% |
Piovan S.p.A. Aquatech S.r.l. |
Full |
| Piovan Korea | Seoul (Korea) | Corea | KRW | 300,000,000 | 100,00% | Piovan S.p.A. | Full |
| Nu-Vu Conair Pvt. Ltd. | Ahmedabad (India) | India | INR | 19,915,000 | 51,00% | IPEG Inc. | Equity |
| method | |||||||
| Equity investments in affiliated companies: | |||||||
| CMG S.p.A. | Budrio (BO) | Italia | EUR | 1,250,000 | 20,00% | Piovan S.p.A. | Equity method |
| Penta Auto Feeding India Ltd |
Navi Mumbai (India) | India | INR | 10,000,000 | 50,00% | Penta S.r.l. | Equity method |
Subsequent events after June 30, 2024
Please refer to what is more fully described in the paragraph "Group performance" for significant events that occurred after June 30, 2024.
Santa Maria di Sala (Venice), August 7, 2024
On behalf of the Board of Directors
Executive Chairman
Nicola Piovan
DECLARATION OF THE CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AT JUNE 30, 2024
Declaration as per Article 154-bis of Legs. Decree No. 58 of 24.02.1998 and Article 81-ter of Consob Regulation No. 11971 of May 14, 1999 and subsequent amendments and supplements
Santa Maria di Sala, August 7, 2024
The undersigned Filippo Zuppichin, Chief Executive Officer, and Giovanni Rigodanza, Executive Officer for Financial Reporting of Piovan S.p.A. declare, also in consideration of Article 154-bis, paragraphs 3 and 4, of Legislative Decree No. 58 of February 24, 1998:
- the accuracy of the information on company operations and
- the effective application
of the administrative and accounting procedures for the drawing up of the Consolidated Half-Year Financial Report for the first half of 2024.
No significant aspect emerged concerning the above.
It is also declared that the Consolidated Half-Year Financial Report at June 30, 2024:
- a) is drawn up in compliance with the applicable international accounting standards recognized by the European Union, in accordance with Regulation (EC) No. 1606/2002 of the European Parliament and the Council of July 19, 2002;
- b) correspond to the underlying accounting documents and records;
- c) provide a true and fair view of the financial position, financial performance and cash flow of the Issuer and of the other companies in the consolidation scope.
The Interim Directors' Report includes a reliable analysis on the performance and operating result as well as the situation of the issuer and of the companies included in the consolidation, together with a description of the principal risks and uncertainties to which they are exposed.
It also presents a reliable analysis of the significant transactions with related parties.
The Chief Executive Officer The Executive Officer for
Financial Reporting
Filippo Zuppichin Giovanni Rigodanza
AUDITORS' REPORT ON THE CONDENSED CONSOLIDATED HALF-YEAR FINANCIAL STATEMENTS AT JUNE 30, 2024
Deloitte & Touche S.p.A. Via Fratelli Bandiera, 3 31100 Treviso Italia
Tel: +39 0422 5875 Fax: +39 0422 587812 www.deloitte.it
REPORT ON REVIEW OF THE HALF-YEARLY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
To the Shareholders of Piovan S.p.A.
Introduction
We have reviewed the accompanying half-yearly condensed consolidated financial statements of Piovan S.p.A. and subsidiaries ("Piovan Group"), which comprise the consolidated statement of financial position as of June 30, 2024, consolidated statement of profit and loss, consolidated statement of comprehensive income, consolidated statement of cash flows and consolidated statement of changes in equity for the six month period then ended, and the related explanatory notes. The Directors are responsible for the preparation of the half-yearly condensed consolidated financial statements in accordance with the International Accounting Standard applicable to the interim financial reporting (IAS 34) as adopted by the European Union. Our responsibility is to express a conclusion on the halfyearly condensed consolidated financial statements based on our review.
Scope of Review
We conducted our review in accordance with the criteria recommended by the Italian Regulatory Commission for Companies and the Stock Exchange ("Consob") for the review of the half-yearly financial statements under Resolution n° 10867 of July 31, 1997. A review of half-yearly condensed consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (ISA Italia) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying half-yearly condensed consolidated financial statements of Piovan Group as at June 30, 2024 are not prepared, in all material respects, in accordance with the International Accounting Standard applicable to the interim financial reporting (IAS 34) as adopted by the European Union.
DELOITTE & TOUCHE S.p.A.
Signed by Barbara Moscardi Partner
Treviso, Italy August 7, 2024
This report has been translated into the English language solely for the convenience of international readers. Accordingly, only the original text in Italian language is authoritative.
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Piovan S.p.A. - Consolidated Half-Year Financial Report at June 30, 2024
PIOVAN S.p.A.
Via delle Industrie 16 – 30036 S. Maria di Sala VE - Italy
