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LISLE-DABEAU, France–(BUSINESS WIRE)–Regulatory News:
Vicat (Paris:VCT):
Condensed income statement approved by the Board of Directors on 10 February 2023
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 3,642 |
| 3,123 |
| +16.6% |
| +19.7% | |
EBITDA* | 570 |
| 619 |
| 7.9% |
| 5.9% | |
Margin (%) | 15.7% |
| 19.8% |
|
|
|
| |
Recurring EBIT* | 284 |
| 360 |
| 21.0% |
| 19.0% | |
Margin (%) | 7.8% |
| 11.5% |
|
|
|
| |
Consolidated net income | 175 |
| 222 |
| 21.0% |
| 28.0% | |
Margin (%) | 4.8% |
| 7.1% |
|
|
|
| |
Net income, Group share | 156 |
| 204 |
| 23.6% |
| 29.5% | |
Cash flow from operations | 461 |
| 488 |
| 5,5% |
| 6.0% |
*Definitions in the appendix of this press release
Commenting on these figures, Guy Sidos, the Groups Chairman and CEO, said: In 2022, the Vicat Group demonstrated resilience amid tough conditions. Faced with an unfavourable basis of comparison as a result of the sharp post-Covid rebound in business trends during 2021, a very strong increase in energy costs and non-recurring industrial costs in the United States, France and India, we responded rapidly, raising our selling prices significantly across almost all the markets in which we operate to offset the impact of inflation.
We have made progress with our policy of lowering our greenhouse gas emissions by harnessing existing solutions and investing in technologies that will enable us to reach our new 2030 targets.
Disclaimer:
Further information about Vicat is available from its website (www.vicat.fr).
———————————————————————————————————————————–
The Group posted strong sales growth in 2022 driven by a significant rise in its selling prices. This performance reflected:
Overall, the Groups consolidated sales totalled 3,642 million, up from 3,123 million in 2021, representing a +19.7% increase at constant scope and exchange rates.
Consolidated sales rose +16.6% on a reported basis as a result of:
– a scope effect of 0.3% (negative impact of 10 million), largely resulting from the sale of the lightweight precast business in Switzerland, which was finalised on 30 June 2021;
– a negative currency effect of 2.7%, representing a negative impact of 86 million over the year owing to the depreciation in the euro against other currencies except for the Turkish lira and the Egyptian pound; and
– organic growth of +19.7% (+615 million) supported by increases in selling prices across all the regions.
The Groups operational sales totalled 4,149 million, up +16.6% on a reported basis and up +20.6% at constant scope and exchange rates. Each of the Groups businesses contributed to this positive trend. In the Cement business, sales (2,296 million) rose +24.1% at constant scope and exchange rates. In the Concrete & Aggregates business, operational sales (1,398 million) rose by +18.5% at constant scope and exchange rates. Lastly, sales in the Other Products and Services business (454 million) rose +11.1% at constant scope and exchange rates.
Vicats consolidated EBITDA came to 570 million in 2022, down 7.9% on a reported basis and down 5.9% at constant scope and exchange rates. The EBITDA margin was 15.6%, down 420 basis points. The trend in reported EBITDA reflects an unfavourable currency effect of 13 million and an organic decline of 36 million. Despite this unprecedented inflation in costs, operating profitability was again well above its 2020 level (557million).
At constant scope and exchange rates, the EBITDA decrease was primarily attributable to:
the operational upgrade in the first quarter of the Montalieu plant after two pandemic-blighted years;
the capacity increase at the Kalburgi Cement plant during the third quarter.
These three operations will have a highly positive impact on future levels of operating profitability.
Recurring EBIT came to 284 million, down from 360 million in 2021, representing a fall of 21.0% on a reported basis and of 19.1% at constant scope and exchange rates. The recurring EBIT margin on consolidated sales came to 7.8%, a decrease of 370 basis points.
Operating income came to 278 million, down 17.4% on a reported basis and down 14.6% at constant scope and exchange rates. This fall was mainly attributable to the contraction in operating profitability affecting both EBITDA and recurring EBIT.
Of this 20 million reduction in net financial income (expense) compared with 2021:
The macroeconomic and inflationary situation in Turkey meets the criteria set out under IAS 29 for application of the accounting arrangements for hyperinflationary economies. Under the standard, non-monetary items are restated based on the change in a general price index between the date those items were acquired and the end of the reference period to reflect their actual value at the balance sheet date translated at the year-end exchange rate. In Turkeys case, application of the standard has prompted:
Tax expense declined 24 million compared with 2021. The effective tax rate was 28.6%, below the 2021 rate of 29.2%.
This reduction in tax derived primarily from the fall in the Groups taxable income and the new tax convention applicable in Senegal with retroactive effect from 1 January 2021, leading to a reduction in deferred tax liabilities.
Consolidated net income was 175 million, down 28.0% at constant scope and exchange rates and down 21.0% on a reported basis versus 2021.
Net income, Group share fell 29.5% at constant scope and exchange rates and 23.6% on a reported basis to 156 million.
Cash flow from operations came to 461 million, down 5.5% on a reported basis and down 6.0% at constant scope and exchange rates, reflecting the decrease in EBITDA generated over the year and the non-cash IAS 29 adjustments.
On the strength of these full-year 2022 results and given its confidence in the Groups ability to continue pursuing its development, the Board of Directors decided at its meeting on 10 February 2023 to propose the distribution of a dividend of 1.65 per share, at the Groups Annual General Meeting due to be held on 7 April 2023.
1. Income statement analysed by geographical region
1.1. Income statement, France
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 1,177 |
| 1,074 |
| +9.6% |
| +6.8% | |
EBITDA | 172 |
| 201 |
| 14.6% |
| 15.6% | |
Recurring EBIT | 75 |
| 118 |
| 36.2% |
| 36.7% |
The Groups sales in France moved higher in 2022, despite a small reduction in volumes from the record levels seen in 2021. Cement consumption held up at a high level, however. In a high-inflation environment, selling prices rose significantly across all the Groups activities.
EBITDA declined significantly during the period given the very clear increase in operating costs, particularly energy costs (up +55%), and an unfavourable basis for comparison in 2021.
1.2 Income statement for Europe (excluding France)
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 388 |
| 394 |
| 1.4% |
| +2.5% | |
EBITDA | 85 |
| 89 |
| 4.2% |
| 8.2% | |
Recurring EBIT | 51 |
| 55 |
| 7.9% |
| 14.6% |
Business trends in Europe (excluding France) were positive in 2022, supported by a still solid environment in Switzerland given an unfavourable basis of comparison, and a positive industry environment in Italy. The decline in sales on a reported basis reflects a scope effect resulting from the sale of the Creabeton precast business in Switzerland, which was finalised on 30 June 2021. EBITDA across the region as a whole declined 4.2% on a reported basis and 8.2% at constant scope and exchange rates as a result of the significant increase in energy costs in Switzerland, especially in electricity, which gained pace during the second half of 2022.
In Switzerland, the Groups consolidated sales were stable at constant scope and exchange rates (down 4.1% on a reported basis). EBITDA moved 11.4% lower at constant scope and exchange rates. The EBITDA margin on consolidated sales narrowed slightly to 22.4% from 23.2% in 2021.
In Italy, consolidated sales grew by +45.8%. Volumes rose and selling prices moved significantly higher throughout the period. EBITDA rose strongly over the year.
1.3 Income statement for the Americas
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 860 |
| 672 |
| +27.9% |
| +12.4% | |
EBITDA | 135 |
| 140 |
| 3.3% |
| 15.2% | |
Recurring EBIT | 72 |
| 84 |
| 13.7% |
| 24.5% |
Demand across the Americas region remained solid in the construction sector despite a high basis of comparison, especially in Brazil. The impact of the surge in energy prices and of the non-recurring costs linked to the start-up of the Ragland plants new kiln was offset only partially by the hike in selling prices. Consequently, EBITDA moved lower over the full year.
In the United States, the sector environment remained favourable. Second- and third-quarter performance was adversely affected by the start-up of the Ragland plants new kiln in Alabama, which temporarily reduced production capacity and deliveries in the region. Lastly, highly unfavourable weather conditions in the South-East region adversely affected performance at the end of the year. In spite of this non-recurring effect, consolidated sales totalled 581 million, up +6.6% at constant scope and exchange rates, supported by the strong performance in California. As a result, EBITDA totalled 88 million, down 19.0% at constant scope and exchange rates.
Construction of the Ragland plants new 5,000-tonne per day kiln line in Alabama is now complete. This installation has increased the plants capacity so it can meet the strong demand in the marketplace, substantially reduce production costs and actively help the Group to meet its CO2 emission reduction targets. Following a series of technical adjustments during the third quarter, the ramp-up of the new plant remained on track during the final quarter of the year.
In Brazil, consolidated sales totalled 279 million, up +27.3% at constant scope and exchange rates. Despite an unfavourable basis for comparison, higher interest rates and inflation in the country, volumes were stable in the Groups markets. The hike in prices has to date partially offset the surge in production costs. As a result, EBITDA declined 6.7% at constant scope and exchange rates to 47 million over the year.
1.4 Asia (India and Kazakhstan)
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 500 |
| 428 |
| +16.8 |
| +10.7% | |
EBITDA | 98 |
| 122 |
| 19.2% |
| 23.3% | |
Recurring EBIT | 64 |
| 88 |
| 27.0% |
| 30.6% |
Sales in India grew throughout the period, with consolidated sales rising to 433 million, up +12.8% at constant scope and exchange rates. This performance was driven by volume growth, supported in particular by public-sector demand. Amid very strong inflation, higher selling prices only partially made up for the very strong rise in energy costs. In addition, work on increasing capacity at the Kalburgi Cement plant amid high activity levels gave rise to non-recurring operating expenses.
As a result, EBITDA fell to 73 million, down 31.2% at constant scope and exchange rates versus its 2021 level.
Consolidated sales in Kazakhstan came to 67 million, down 1.0% at constant scope and exchange rates. This performance reflected a significant increase in selling prices, which almost entirely offset the contraction in volumes delivered during the period. Whats more, the higher selling prices made up for the impact of cost inflation. As a result, full-year EBITDA came to 26 million, up +12.5% at constant scope and exchange rates.
1.5 Mediterranean (Turkey and Egypt) income statement
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 374 |
| 228 |
| +63.8% |
| +170.7% | |
EBITDA | 44 |
| 3 |
| n.a |
| n.a | |
EBIT | 20 |
| 15 |
| n.a |
| n.a |
In the Mediterranean region, sales moved sharply higher in both countries amid a persistent lack of visibility. The key factor behind the increase was a large hike in selling prices, sparking a significant recovery in operating profitability.
In Turkey, the macroeconomic and sector environment was affected by the hyperinflation. Overall, consolidated sales totalled 258 million (versus 150 million in 2021), up +226.8% at constant scope and exchange rates.
EBITDA recorded a significant increase over the full year to 44 million, up from 13 million in 2021. As a result, the EBITDA margin on consolidated sales was 17.2% versus 8.5% in 2021.
In Egypt, consolidated sales totalled 116 million, up +62.3% at constant scope and exchange rates. Following the market regulation agreement between the Egyptian government and all producers that entered force in July 2021 and was renewed in August 2022, selling prices in the domestic market continued to improve, supported by an increase in demand in a market adversely affected by inflation and the currency devaluation. Overall, Egypt contributed a breakeven EBITDA performance in 2022, compared with a loss of close to 10 million in 2021.
1.6 Africa (Senegal, Mali, Mauritania) income statement
( million) | 2022 |
| 2021 |
| Change (reported) |
|
Change | |
Consolidated sales | 343 |
| 327 |
| +4.9% |
| +4.1% | |
EBITDA | 36 |
| 65 |
| 44.4% |
| 45.1% | |
EBIT | 2 |
| 30 |
| 93.1% |
| 94.4% |
In Africa, the market remained resilient despite the effects of inflation and the political crisis in Mali on the regions economy.
2. Changes in the Groups financial position at 31 December 2022
At 31 December 2022, the Groups financial structure remained solid, with a substantial equity base and net debt under control despite the higher working capital requirement. Consolidated equity totalled 2,863 million at that date, compared with 2,606 million at 31 December 2021.
Net debt totalled 1,567 million at 31 December 2022 compared with 1,318 million at 31 December 2021.
On this basis, the Groups leverage ratio stood at 2.75x (versus 2.13x at 31 December 2021) and its gearing at 54.7% (versus 50.6% at 31 December 2021) at 31 December 2022.
Medium- to long-term borrowings are subject to special clauses (covenants) requiring certain financial ratios to be met. Given the level of Groups net debt and balance sheet liquidity, the bank covenants do not pose a risk for the Groups financial position. At 31 December 2022, the Group was compliant with all financial ratios required by covenants included in financing agreements.
3. Capital expenditure and
Contacts
Investor relations contact:
Stéphane Bisseuil:
Tel + 33 (0)1 58 86 86 05
stephane.bisseuil@vicat.fr
Press contacts:
Karine Boistelle-Adnet
Tel +33 (0)4 74 27 58 04
karine.boistelleadnet@vicat.fr
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