Verallia SAS · EURONEXT:VRLA
Verallia SAS — Verallia — Q1 2020 Earnings Presentation
24 slides from Verallia SAS's earnings presentation, Apr 28, 2020
Slide 1: Q1 2020 Results
Q1 2020 Results April 28th, 2020
Slide 2: Agenda
Q1 2020 Results 1. Financial highlights and key initiatives 2. Financial results 3. Cash performance 4. Conclusion and outlook Verallia Q1 2020 Results 28/04/2020 2
Slide 3: Q1 2020 financial highlights
Q1 2020 financial highlights Good start of the year with limited impact from the COVID-19 epidemic Revenue - Reported revenue at €645m, up +1.9% vs. Q1 2019 - Sustained organic growth of +4.0% (+2.0% excluding Argentina) vs. Q1 2019 Adjusted EBITDA - Up 6.5% at €151m (+9.6% at constant exchang
Slide 4: Group activity update on COVID-19 and short term priorities
Group activity update on COVID-19 and short term priorities Crisis Management with 3 clear immediate priorities: 1. Preserve our employees’ health and safety 2. Ensure business continuity to serve our customers 3. Protect our financial strength Verallia: united and responsible 1. Unprecedented s
Slide 5: Priority 1: Preserve our employees' health and safety
Priority 1: PRESERVE OUR EMPLOYEES’ HEALTH AND SAFETY In all sites, measures to guarantee employees health and safety are stricter than public authorities’ guidelines: Remote work swiftly and widely rolled out whenever possible Social distancing Adoption of strict hygienic measures Employee
Slide 6: Priority 2: Ensure business continuity to serve our customers
Priority 2: ENSURE BUSINESS CONTINUITY TO SERVE OUR CUSTOMERS Business continuity and continuous production: - VRLA activity has been considered as essential worldwide all production sites serving clients - Decentralized management agility: Crisis cells and business continuity plans by plant / c
Slide 7: Priority 3: Protect our financial strength
Priority 3: PROTECT OUR FINANCIAL STRENGTH Solid balance sheet and liquidity, as at March 31, 2020 - Continuous deleveraging ability to 2.5x LTM adjusted EBITDA, well below maximum leverage covenant at 5x - €528m available liquidity(*) - Healthy debt maturity profile: no significant debt maturitie
Slide 8: Verallia: United and responsible - initiatives of solidarity
Verallia: United and responsible unprecedent initiatives of solidarity AT GROUP LEVEL LOCAL DONATIONS LOCAL SERVICES Michel Giannuzzi, Verallia’s Hospital equipment Germany and Spain: CEO renouncing his 2020 restrooms and showers for Hydroalcoholic gels truckdrivers variable compensation r
Slide 9: Chile: Start-up of new furnace reconstruction in Q1 2020
CHILE: Start-up of new furnace reconstruction in Q1 2020 Circa $40m investment: Complete furnace reconstruction, factory upgrade and addition of a production line at the Rosario site in Chile Increase of capacity set to generate additional annual production of around 50 kT, primarily for the win
Slide 10: Furnace of the Future: glass industry decarbonization initiative
FURNACE OF THE FUTURE: GLASS INDUSTRY COLLABORATIVE INITIATIVE IN ITS DECARBONIZATION JOURNEY Common initiative under the framework of the FEVE(*) to build first large-scale hybrid oxy-fuel furnace running on 80% electricity Glass is currently -30% lighter 70% less energy-intensive emits 50% less CO
Slide 11: Financial results
Q1 2020 Results 1.Financial highlights and key initiatives 2. Financial results 3. Cash performance 4. Conclusion and outlook Verallia Q1 2020 Results 28/04/2020 11
Slide 12: Sustained organic growth
Sustained organic growth Activity decreasing despite slight volume growth because of France Reported revenue (in €m) - SWE: dynamic demand, particularly for food jars and beer. Positive growth Reported Growth: +1.9% in Italy and Iberia. France: decline Organic Growth*: +4.0% intensified mid-March
Slide 13: Growth in adjusted EBITDA and margin expansion
Growth in adjusted EBITDA and margin expansion Adjusted EBITDA (in €m) Adjusted EBITDA margin Q1 2019 Q1 2020 Reported Growth: +6.5% 22.4% 23.5% +103 bps Organic Growth*: +9.6% 7.9 (4.3) At constant exchange rates & (2.0) 151 scope, adjusted EBITDA increased by 9.6%, driven by Verallia’s 3 pillars
Slide 14: Cash performance
Q1 2020 Results 1.Financial highlights and key initiatives 2. Financial results 3. Cash performance 4. Conclusion and outlook Verallia Q1 2020 Results 28/04/2020 14
Slide 15: Continuous deleveraging capabilities
Continuous deleveraging capabilities In € million 31/03/2019(*) 31/03/2020 Net Debt 1,790.7 1,574.1 LTM Adjusted EBITDA 580.6(**) 624.5 Net Debt / LTM Adjusted EBITDA 3.1x 2.5x 2.5x ratio of net debt over LTM adjusted EBITDA as at March 31, 2020: - Net debt at €1,574.1 million - Q1 2020 LTM Adjust
Slide 16: Strong balance sheet underpinning Verallia's resilience
Strong balance sheet underpinning Verallia’s resilience Nominal amount or Final In € million maximum amount Nominal rate March 31, 2020 maturity drawable Term Loan A 1,500.0 Euribor +1.75% 07/10/2024 1,491.4 Revolving Credit Facility 500.0 Euribor +1.35% 07/10/2024 200.0 Commercial Papers Neu CP 400
Slide 17: Conclusion and outlook
Q1 2020 Results 1. Financial highlights and key initiatives 2. Financial results 3. Cash performance 4. Conclusion and outlook Verallia Q1 2020 Results 28/04/2020 17
Slide 18: Conclusion and outlook
Conclusion and outlook • Sustained organic growth of +4.0% Solid Q1 • Improved adjusted EBITDA margin to 23.5% (+103 bps vs. Q1 2019) • Deleveraging to 2.5x LTM adjusted EBITDA (-0.1x vs. end of Dec 2019) • Uncertain macro-environment leading to 2020 guidance withdrawal • Continuous adaptation measu
Slide 19: Appendices
Q1 2020 Results Appendices Verallia Q1 2020 Results 28/04/2020 19
Slide 20: Glossary
Glossary Organic growth: corresponds to revenue growth at constant exchange rates and scope. Revenue growth at constant exchange rates is calculated by applying the average exchange rates of the comparative period to revenue for the current period of each Group entity, expressed in its reporting c
Slide 21: Key figures in Q1
Key figures in Q1 In € million Q1 2020 Q1 2019 Revenue 644.8 632.9 Reported growth +1.9% Organic growth +4.0% Adjusted EBITDA 151.3 142.0 Adjusted EBITDA margin 23.5% 22.4% Net debt as of 31 March (i) 1,574.1 1,790.7 Last twelve months adjusted EBITDA (ii) 624.5 580.6 Net debt / last twelve months a
Slide 22: Reconciliation of operating profit to adjusted EBITDA
Reconciliation of operating profit to adjusted EBITDA In € million Q1 2020 Q1 2019 Operating profit 79.5 65.5 Depreciation and amortisation (i) 70.0 69.3 Restructuring costs 0.5 0.8 Acquisition, M&A 0.0 0.1 IAS 29 Hyperinflation (Argentina) (ii) 0.2 0.2 Management share ownership plan and associated
Slide 23: IAS 29: Hyperinflation in Argentina
IAS 29: Hyperinflation in Argentina Since the second half of 2018, the Group has applied IAS 29 in Argentina. The adoption of IAS 29 requires the restatement of non-monetary assets and liabilities and of the income statement to reflect changes in purchasing power in the local currency, leading to a
Slide 24: Disclaimer
Disclaimer Certain information included in this presentation are not historical facts but are forward-looking statements. These forward-looking statements are based on current beliefs, expectations and assumptions, including, without limitation, assumptions regarding present and future business stra