Elis Sa · EURONEXT:ELIS
Elis Sa — H1 2024 Earnings Presentation
39 slides from Elis Sa's earnings presentation, Jul 24, 2024
Slide 1: H1 2024 results
Pelis at work H1 2024 results July 24, 2024
Slide 2: Forward-looking statements disclaimer
This presentation may include data information and statements relating to estimates, future events, trends, plans, expectations, objectives, outlook and other forward-looking statements relating to the Group’s future business, financial condition, results of operations, performance and strategy as t
Slide 3: Agenda
H1 2024 business H1 2024 financial A responsible Upwards revision Q&A highlights highlights business of 2024 outlook
Slide 4: H1 2024 business highlights
H1 2024 business highlights
Slide 5: Solid financial and operational performance in H1 2024
Solid financial and operational performance in H1 2024 Continuous commercial momentum, Solid results in all our geographies further industrial and logistics optimization ≫ H1 2024 revenue at €2,246.7m, up +6.9% ≫ Well-oriented commercial activity, with new of which +5.5% on an organic basis contract
Slide 6: +6.9% topline growth in H1 driven by commercial momentum and pricing
+6.9% topline growth in H1 driven by good commercial momentum and sound pricing Volumes Pricing ≫ Strong commercial activity in Workwear with many new ≫ Good pricing dynamic in all our end-markets, driven by contracts signed adjustments to offset cost-base inflation ≫ Strong numbers in Central Europ
Slide 7: Many commercial successes in the first half
Many commercial successes in the first half, driven by ongoing outsourcing and the roll-out of Elis’ offer across our geographies Development of the pest Strong momentum in Roll-out of Elis’ services offer Hospitality and Healthcare control and cleanroom workwear continues to small clients still off
Slide 8: Churn is back to its normative c. 6% level
Churn is back to its normative c. 6% level Churn rate increased slightly in 2023… … but is now back to its normative level Over 2022-2023, Elis faced a strong inflationary environment Elis has very good commercial relationships with its clients that occasionally led to some volume losses ≫ In 2024,
Slide 9: France: Further margin improvement driven by operational efficiencies
France: Further margin improvement driven by operational efficiencies and operating leverage Good commercial developments despite external headwinds ≫ Dynamism remains good in Workwear, notably in Industry and in Trade & Services ≫ Hospitality activity impacted in Q2 by (i) poor weather in May and J
Slide 10: Potential political change in France should have no impact on the Group
Potential political change in France should have no impact on the Group The possible outcomes of a significant political shift in France are: 01 02 A material minimum wage increase An overall slowdown in the country’s activity that would result in an increase of our labor costs ➔Elis’ well diversifi
Slide 11: Central Europe: Good organic and margin performance
Central Europe: Good organic and margin performance, notably in Germany +7.7% organic revenue growth with new outsourcing and pricing driving performance ≫ Poland, Netherlands and Germany are well oriented on the back of good pricing dynamic and further development in Workwear (both standard and cle
Slide 12: Scandinavia & Eastern Europe: Sound growth and strong profitability
Scandinavia & Eastern Europe: Sound growth and strong profitability Good organic revenue growth in Sweden and Baltics; Denmark is more challenging ≫ Further outsourcing development drove solid performance in Sweden and in the Baltics ≫ Some volume losses in Denmark in a context of continuous pricing
Slide 13: UK & Ireland: Good topline momentum and productivity gains
UK & Ireland: Good topline momentum and further productivity gains +5.1% organic revenue growth driven by commercial dynamism and sound pricing ≫ The UK is well oriented with organic revenue growth of c. +6% ≫ Further commercial successes, notably in Healthcare and Workwear ≫ Subdued activity in Fla
Slide 14: Latin America: Strong organic performance and EBITDA margin
Latin America: Strong organic performance and EBITDA margin close to 35% Good organic momentum across the region; Mexico posted another +10% performance in H1 ≫ Good commercial momentum, especially driven by Healthcare ≫ Inflation below 5% in the region results in price increases similar to Europe’s
Slide 15: Southern Europe: Very strong margin improvement
Southern Europe: Very strong margin improvement driven by productivity gains +6.6% organic revenue growth in the region ≫ Outsourcing trend continues with new contract wins in Workwear ≫ Solid activity in Hospitality in Portugal and Spain +250bps margin improvement driven by good energy purchasing c
Slide 16: Moderna acquisition improves Elis' footprint in the Netherlands
Moderna acquisition significantly improves Elis’ footprint in the Netherlands Revenue breakdown by activity Moderna is a Dutch player with c. €50m revenue, a diversified product mix and national coverage 9% ≫ This acquisition complements Elis’ existing network in the Netherlands, especially in the b
Slide 17: The capacity of Moderna's plant enables nationwide coverage
The capacity of Moderna’s plant enables nationwide coverage A great industrial asset Bolsward ≫ 1 main plant in Hardenberg and 2 distribution centers located in Helmond and Zaandam enable national coverage ≫ c. 400 people in the Hardenberg plant Hoogeveen ≫ Capacity of c. 250 tons of Flat Linen per
Slide 18: Elis enters the Malaysian Cleanroom market
Elis enters the Malaysian Cleanroom market Acquisition of Wonway, closed on July 1st 2024 Revenue breakdown by activity ≫ A 200-employee, family-owned business founded in 1984 ≫ Clients are essentially international groups operating in semiconductors, medical devices and chemicals ≫ National coverag
Slide 19: H1 2024 financial highlights
H1 2024 financial highlights
Slide 20: Elis offers a highly diversified and well-balanced profile
Elis offers a highly diversified and well-balanced profile H1 2024 revenue breakdown By activity By market By geography Southern Europe Trade & Services Industry France Workwear Latin America 9% 37% 18% 27% 10% 30% UK & Ireland 12% 46% 30% 17% 25% 14% 25% Hygiene Scandinavia Central Flat Linen & Wel
Slide 21: +6.9% revenue growth in H1, with EBITDA margin at 34.5%
+6.9% revenue growth in H1, with EBITDA margin at 34.5%, up +120bps H1 2024 organic revenue growth and reported revenue growth evolution by geography +12.0% +8.7% +7.7% +7.2% +7.5% +8.7% +6.9% +6.6% +5.5% +5.1% +3.6% +3.6% +4.2% +3.1% France Central Scandinavia UK & Latin Southern Group organic Euro
Slide 22: +120bps EBITDA margin improvement; EBIT at 15.3% in H1 2024
+120bps EBITDA margin improvement; EBIT at 15.3% in H1 2024 (In €m) H1 2024 H1 20231 % change Revenue 2,246.7 2,101.3 +6.9% Adjusted EBITDA 774.3 698.1 +10.9% As a % of revenue 34.5% 33.2% +120bps Normalization of D&A to sales at 19.2% (low 18.2% in H1 D&A (430.6) (381.7) 2023 reflecting lower linen
Slide 23: H1 2024 fully diluted headline net income per share up +1.6%
H1 2024 fully diluted headline net income per share up +1.6% at €0.83, in line with the full-year guidance of above €1.75 (c +4% yoy) (In €m) H1 2024 H1 20231 % change Net income 119.1 138.6 -14.1% Amortization of intangible assets recognized in a business combination 41.8 41.3 IFRS 2 expense 12.5 1
Slide 24: H1 free cash flow up c. +€39m in the first half
H1 free cash flow up c. +€39m in the first half (In €m) H1 2024 H1 2023 Adjusted EBITDA 774.3 698.1 Adjustment of (gains) and losses on disposal of fixed assets and change in provisions 2.0 1.2 Monetary non-recurring items included in Operating income and expense (11.5) (6.7) IFRS 2 expense (social
Slide 25: A well-diversified debt profile and well-spread maturities
A well-diversified debt profile and well-spread maturities Well-diversified financing Debt highlights Euro bonds ≫ Successful issuance of a new €400m bond at 3.75% maturing in April 2030 (at the best possible market conditions seen over the first half) USPP ≫ The Group still aims for a reduction of
Slide 26: Deleveraging trajectory on track: leverage at 2.06x
Deleveraging trajectory on track: Net financial leverage at 2.06x at June 30, 2024 Net debt and financial leverage ratio evolution between 2019 and 2023 3500 3.4 3,5 3400 3.0 3.0 3 3300 2.5 3200 2,5 2.0 2.1 3100 2 3000 1.8 2900 1,5 2800 1 2700 0,5 2600 2500 0 Dec 2019 Dec 2020 Dec 2021 Dec 2022 Dec
Slide 27: H1 2024 key financial takeaways
H1 2024 key financial takeaways Good top line Adjusted EBITDA margin Headline net income Free cash flow at €55m, dynamism, driven by and adjusted EBIT margin up +0.9% at €209m; up c. +€39m yoy and in commercial up +120bps and +20bps Headline net income line with our full-year momentum and pricing re
Slide 28: A responsible business
A responsible business
Slide 29: H1 2024 CSR highlights
H1 2024 CSR highlights New award for Elis Acceleration in fleet transition ≫ Elis received the "Special Mention" award for its ≫ Elis supported by ADEME for its alternative transition; transformation strategy at the Sustainable about 75 new electric heavy trucks and 45 biofuel trucks Transformation
Slide 30: Improvement in many CSR ratings
Improvement in many CSR ratings, rewarding Elis’ initiatives Moody’s Analytics significantly improved Elis’ rating from 50/100 to 61/100 Elis ranked A- by the CDP 75/100 score maintained. for its 3rd year of reporting; Gold level, positioning Elis within the Leadership Elis among the top 5% of categ
Slide 31: Upwards revision of 2024 outlook
Upwards revision of 2024 outlook
Slide 32: Elis' strategy relies on 4 pillars
Elis’ strategy relies on 4 pillars Development of sustainable services and promotion of the circular economy Industrial and Network 2 commercial expansion excellence 4 Consolidation of current positions 32
Slide 33: Proven business resilience over the years
Proven business resilience over the years Global Financial Crisis Covid-19 War in recession Ukraine 4 500 34.2% 40% 34.5% 33.6% 33.8% 33.0% 4 000 32.7% 32.2% 32.2% 31.7% 31.1% 31.7% 31.9% 32.1% 32.5% 32.3% 31.8% 32.7% 31.5% 30.9% 30.6% 31.5% 35% 30.5% 31.1% 3 500 30% 3 000 25% 2 500 20% 2 000 15% 1
Slide 34: Full-year organic growth and EBITDA margin objectives raised
Full-year organic growth and EBITDA margin objectives raised Organic revenue growth Adjusted EBITDA margin Adjusted EBIT margin now1 expected now2 expected still expected between 5.2% and 5.5% between 35.2% and 35.5% stable yoy at c. 16% ✓ Driven by churn improvement and ✓ Top line dynamism, further
Slide 35: Appendix
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Slide 36: Appendix: Restatement of H1 2023 figures
Appendix: Restatement of H1 2023 figures IFRS 3 “Business combinations” ▪ IFRS 3 requires previously published comparative periods to be retrospectively restated for business combinations (recognition of the final fair value of the assets acquired and the liabilities and contingent liabilities assum
Slide 37: Appendix: Reconciliation between Net financial result and Net interest paid
Appendix: Reconciliation between Net financial result and Net interest paid (in €m) P&L - Net financial result (in €m) Cash flow – Net interest paid Financial debt interests (cash) (70.0) Financial debt interests (cash) (70.0) Leasing debt interests (cash) (12.7) Leasing debt interests (cash) (12.7)
Slide 38: Appendix: Financial definitions
Appendix: Financial definitions ▪ Organic growth in the Group’s revenue is calculated excluding (i) the impacts of changes in the scope of consolidation of “major acquisitions” and “major disposals” (as defined in the Document de Base) in each of the periods under comparison, as well as (ii) the imp
Slide 39: Investor relations contacts
Nicolas Buron Charline Lefaucheux ELIS SA Director of Investor Relations, Financing & Treasury Investor Relations 5, boulevard Louis Loucheur Tel: +33 1 75 49 98 30 Tel: +33 1 75 49 98 15 92210 Saint-Cloud Mob: +33 6 83 77 66 74 Mob: +33 7 65 18 45 65 France Email: nicolas.buron@elis.com Email: char