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Group result January - June 2019

The full order book at the start of 2019 translated int very respectable sales growth of 7.5% in the first six months of 2019. Order intake continued to be strong which resulted in an order book that was 7.6% larger as of the end of July compared to twelve months ago. Sales of service and maintenance grew by 3.5% not matching the increase in product sales of 10.4%. The resulting change in the sales mix caused a slight decrease in the gross margin.EBITDA growth was 10.5% on a like-for-like basis, still more than growth of sales. The unadjusted EBITDA growth of 29.3% resulted from the implementation of IFRS 16 (leasing) and a pension cost credit.

Net cash (EUR 74.5 million) is considerably higher than 12 months ago (EUR 64.1 million) despite the first-time inclusion of EUR 14.2 million of leasing liabilities as financial debt due to implementation of IFRS 16 and the payment of a EUR 13.4 million dividend.

Based on the strong order intake of the recent months the expected sales growth of 4 to 5% could be surpassed on a full-year basis at constant exchange rates.

The transaction between the majority owners of agta record and ASSA ABLOY announced on 6 March 2019 is being reviewed by the relevant merger control authorities. ASSA ABLOY continues to expect the transaction to close in the 4th quarter 2019

in EUR million 2019 % 2018 % Change
Turnover 192.0 100.0 178.6 100.0 + 7.5%
Gross profit 141.0 73.4 132.7 74.3 + 6.2%
Personnel expenses 84.6 44.1 83.3 46.6 + 1.5%
Structure cost 25.3 13.2 25.4 14.2 - 0.5%
EBITDA 31.9 16.6 24.7 13.8 + 29.3%
Operating profit 23.9 12.4 18.3 10.2 + 30.8%
Financial result (0.9) - (1.1) - - 19.2%
Profit for the period 18.9 9.8 13.4 7.5 + 41.1%

 

Next media release
3rd quarter turnover on 24 October 2019 (after market closing)

Acceleration of sales growth to 7 % in first six months

Achieving 7.4 % sales growth in the first six months of 2019 (6.2 % at constant exchange rates), agta record almost doubled the sales growth rate compared to the first half of 2018. The Group is benefitting from various sales initiatives and the good reception of its products in many markets.
Order intake was stronger by 5.7 % in the first half of 2019 compared to 2018, adding to the already full order book.
The good topline performance is expected to benefit the operating margins of the first six months.
The transaction between the majority owners of agta record and ASSA ABLOY announced on 6 March 2019 is being reviewed by the relevant merger control authorities. The 4th quarter of 2019 remains the expected closing date of the transaction.

Half-year sales 2019 (January – June) – unaudited

In EUR million 2019 2018 Change
First half-year 192.1 178.8 +7.4 %
Theroef maintenance 78.3 75.6 +3.6 %
First half-year at constant exchange rates 189.8 178.8 +6.2 %

agta record excels with 11 % turnover growth in the first quarter

Turnover growth of the first three month of 2019 benefitted heavily from the strong order book at the beginning of the year (20% larger than 12 months ago). Order intake continued to grow at a high rate, registering 5.7% during the first quarter. The margins increased overproportionately due to the strong turnover growth.

Consolidated Sales (Jan. – Mar. 2019)

in EUR million 2019 2018 Change
Turnover 95.2 85.4 + 11.4 %
Thereof service & maintenance 38.9 36.7 + 5.8 %
Turnover excluding forex impact 94.0 85.4 + 10.0 %

 

 

Consolidated results 2018

agta record booked 2.3% turnover expansion in 2018 which corresponded to 3.7% growth at constant exchange rates. Due to the offer made by ASSA ABLOY to the indirect majority shareholders of agta record on 6 March 2019, extraordinary personnel expenses of EUR 8.9 million had to  be recorded in the 2018 accounts. Excluding this one-off charge, personnel cost would have grown by only 1.4% to EUR 168.7 million which would have resulted in EBITDA growth of 9.4% to EUR 59.6 million(corresponding to an EBITDA margin of 15.9%). The related pro forma net result is EUR 34.7 million, representing 5.5% growth. The unprecedented margins reflect reorganisations in France, the Netherlands, the United Kingdom and the United States.

The financial result suffered from the slight weakening of the Euro against the Swiss Franc.

The Board of Directors will propose a dividend of CHF 1.13 per share to the general meeting on 4 June 2019.

 

Consolidated sales (1 January through 31 December 2018) 

in EUR million 2018 % 2017 % Change
Turnover 375.4 100.0 366.8 100.0 +2.3 %
Work in progress 2.2   (0.1)    
Gross margin 277.0 73.8 269.1 73.4 +3.0 %
Personnel expenses 177.6 47.3 166.4 45.3 +6.7 %
Structure cost 51.2 13.6 50.8 13.8 +0.8 %
EBITDA 50.8 13.5 54.5 14.9 -6.8 %
EBITDA adjusted* 59.6 15.9 54.5 14.9 +9.4 %
Profit for the period 37.8 10 40.9 11.1 -7.6 %
Financial result (2.6) - 1.7 - -
Net income 25.9 6.9 32.9 9 -21.3 %
Net income adjusted* 34.7 9.3 32.9 9 +5.5 %

* Not audited. Excludes extraordinary personnel expenses related to the offer made to the majority shareholders

 

Outlook for 2019

The Group started the year with an order book that was 20% higher on 1 January 2019 than 12 months earlier. In January and February order intake grew by 6.3%. Overall full-year turnover growth is expected to be 4 to 5% at constant exchange rates while EBITDA is expected to grow overproportionately.

 

3.4 % organic sales increase at constant exchange rates 2018 EBITDA expected to grow substantially

The 4th quarter saw a strong pick-up in order intake (EUR 100 million, +8.5 % year-onyear). In terms of sales, comparison with the prior year was impacted by a large project in the U.S. invoiced in the last quarter of 2017 and by various projects postponed to 2019. Consequently, the end of 2018 order book is 20 % higher than 12 months ago.

The agta record Group continues to expect 2018 EBITDA to be significantly higher than 2017

Consolidated sales (January 1 through December 31, 2018)

in EUR Million 2018 2017 Change
Total 12 months 374.4 367.0 + 2.0 %
12 months maintenance 154.7 146.8 + 5.4 %
12 months sales at constant exchange rates 379.3 367.0 + 3.4 %

 

Growth story continues

Turnover growth in the 3rd quarter has been less impacted by adverse exchange rates that in previous quarters. During the first nine months order intake advanced by 2.2% (4.2% at constant exchange rates). Maintenance and service turnover grew by 7.6% in the first nine months excluding the foreign exchange impact. The order book is 8% larger than 12 month ago.

The Group continues to expect full year turnover growth of 4 to 5% based on constant exchange rates. EBITDA is anticipated to increase much stronger than turnover.

Group Sales (1st January – 30th September) 

In EUR million 2018 2017 Change
Nine months 267.9 261.3 +2.5%
Maintenance and service 112.7 106.2 +6.1%
Total first nine months 272.9 261.3 +4.4%

First half-year results 2018

In the first half of 2018, consolidated total turnover grew 4.7% at constant exchange rates. Turnover of the higher margin maintenance and service business even grew 8.2% excluding exchange rate effects. The strong growth of the service and maintenance business contributed to the 90 basis points increase of the gross margin, which was also helped by pricing initiatives across the group and the compensation of raw material price increases by savings in the supply chain. The benefits of the reorganisations in France, the United Kingdom, the Netherlands and the United States allowed personnel cost to decrease slightly and structure cost stay constant, despite an expanding business.

The financial result is predominantly non-cash and driven by the impact exchange rate movements had on the cash positions in the Group.

2018 sales growth continues to be anticipated to be 3 to 4% based on constant exchange rates. 

The group confirms its expectation of sales growth of 4 – 5 % for the full year.

Group key figures (January – June)

In MEUR 2018 % 2017 % Change
Turnover 178.6 100.0 175.2 100.0 + 1.9 %
Gross profit 132.7 74.3 128.6 73.4 + 3.2 %
Personnel expenses 83.3 46.6 83.7 47.8  - 0.5 %
Structure cost 25.4 14.2 25.4 14.5    0.0 %
EBITA 24.7 13.8 20.2 11.5 + 22.3 %
EBIT 18.3 10.2 13.3 7.6 + 37.6 %
Financial result (1.1) -0.6 (0.0) (0.0) NM
Profit for the period 13.4 7.5 10.2 5.8 + 31.3 %

Strong growth of the service business — in the first half of 2018 total growth of 5.3% excluding forex effects

Growth of order intake reached 7.1 % compared to the same period last yeaFor the full year agta record continues to expect turnover growth of 3-4 % at constant exchange rates. The expectation of this above-market growth is based on the accelerationof order intake in the second quarter (7.4 % growth over the prior-year quarter excluding forex effects) especially in important countries such as France, the U.S., Switzerland and in the export to countries where agta record does not have a subsidiary.
EBITDA of the first half-year will grow significantly more than turnover as a result of strong growth of the service and maintenance business and productivity improvements in key countries such as France, the Netherlands und the U.K. where reorganisations and acquisitions took place in recent years.r which allows the group to confirm its 2017 goals for sales growth (4 – 5 % excluding acquisitions) and EBITDA, the latter expected to improve over-proportionately.

Half-year sales 2018 (January – June) – unaudited

In EUR million 2018 2017 Change
First half-year 178.8 174.3 + 2.6 %
First half-year at constant exchange rates 183.6 174.3  + 5.3 %
Thereof maintenace  75.6 71.1  + 6.3 %
At constant exchange rates 77.0 71.1  + 8.3 %

 

Consolidated results 2017

2017 was a great year for agta record on many levels, despite the significant impact of forex movements and restructuring projects in France, the U.K., the Netherlands and in the U.S.A.

Gross margin expanded by 0.7 percentage points to 73.3 % thanks to 1) higher sales of better margin products 2) increased sales at higher margin subsidiaries 3) strength regained in France and 4) savings in the supply chain. EBIT growth benefitted from subdued personal cost growth, but suffered from higher cost in logistics. The year-onyear comparison has to take into account the 2016 EUR 5.5 million impairment of goodwill related to Blasi GmbH.

The financial result of EUR 1.7 million (2016: EUR -1.4 million) was positively impacted by the weakness of the Swiss Franc against the Euro during the second half of 2017.

As of 31 December 2017 the debt-free balance sheet shows reinforced strength highlighted by cash of EUR 62 million and equity of EUR 240 million.

The dividend proposal of CHF 1.30 per share to the general meeting on 12 June 2018 represents a 30 % increase.

 

Group key figures (Jan. – Dec.)

in EUR million 2017 % 2016 % Variation
Turnover 367.0 100.0 351.9 100.0 +4.3 %
Gross margin 269.1 73.3 255.2 72.5 +5.5 %
Personnel expenses 166.4 45.3 160.7 45.7 +3.6 %
Structure cost 50.8 13.8 48 13.6 +5.8 %
EBITDA 54.5 14.9 48.3 13.7 +12.8 %
EBITA 45.9 12.5 40 11.4 +14.7 %
EBIT 40.9 11.1 29.7 8.4 +38 %
Financial result 1.7 - (1.4) - -
Profit of the period 32.9 9 21.8 6.2 +51.1 %

 

Group sales (Jan. - March)

in EUR million 2018 2017 Change
Turnover 85.4 84.4 +1.1 %
thereof maintenance 36.7 34.9 +5.3 %
Sales excluding forex impact 88.1 84.4 +4.3 %

 

Weakness of the U.S. dollar and the Swiss Franc negatively impacted revenue growth in the first quarter. Excluding foreign exchange movements, revenue of maintenance and service would have represented 7.6% growth.

2018 outlook
The Group is expected to benefit from a good economic environment and from the end of restructuring efforts, setting the stage to gain market share in France, the U.K. and the Netherlands. Growth of revenue in service and maintenance is anticipated to accelerate to 4 - 5 %, supporting overall organic revenue growth of 3 - 4 % excluding the impact of foreign exchange movements.

2017 annual report
Current and historical financial information is published online in the shareholders’ section of the Group website; http://www.record.group

2017 sales growth of more than 4 % to EUR 367 million in line with expectations

The maintenance and service business contributed with growth of more than 3 %, which happened on top of high growth in 2016, to overall sales grwoth and achieved sales of EUR 1468.8 million in 2017. The weakness of the British Pound and to a smaller extent of the Swiss Franc (especially towards the end of the year) reduced 2017 total sales by EUR 4.5 million.

Profitability is expected to increase overproportionately and according to plan, with additional improvement potential in France and the UK. The restructuring efforts of the past and additinal benefits from the supply chain contributed to margin increases in 2017

 

in EUR Million 2017 2016 Change
Total 12 months 367.1 351.9 + 4,3 %
12 months sales at constant exchange rates 371.6 351.9 + 5.6 %

 

Consolidated third quarter sales 2017

Order intake grew by 5.4% versus prior year during the first 9 months of 2017.

Assuming a stable Euro versus Swiss Franc rate, the Group is conforming full-year sales growth expectations of 4-5% despite the negative impact of the British Pound which reduced sales growth of the first 9 monts by one percentage point. Profitability is anticipated to increase by a higher rate than sales as a result of savings in purchasing and the first beneftis from the restructuring in France.

Group Sales (1st January – 30th September) – unaudited

In EUR million 2017 2016 Change
First half year 175.5 166.6 + 5.3 %
Third quarter 85.8 84.3 + 1.8 %
Total first nine months 261.3 250.9 + 4.1 %
Sales at constant exchange rates 263.8 250.9 + 5.1 %

Group result January - June 2019

The full order book at the start of 2019 translated int very respectable sales growth of 7.5% in the first six months of 2019. Order intake continued to be strong which resulted in an order book that was 7.6% larger as of the end of July compared to twelve months ago. Sales of service and maintenance grew by 3.5% not matching the increase in product sales of 10.4%. The resulting change in the sales mix caused a slight decrease in the gross margin.EBITDA growth was 10.5% on a like-for-like basis, still more than growth of sales. The unadjusted EBITDA growth of 29.3% resulted from the implementation of IFRS 16 (leasing) and a pension cost credit.

Net cash (EUR 74.5 million) is considerably higher than 12 months ago (EUR 64.1 million) despite the first-time inclusion of EUR 14.2 million of leasing liabilities as financial debt due to implementation of IFRS 16 and the payment of a EUR 13.4 million dividend.

Based on the strong order intake of the recent months the expected sales growth of 4 to 5% could be surpassed on a full-year basis at constant exchange rates.

The transaction between the majority owners of agta record and ASSA ABLOY announced on 6 March 2019 is being reviewed by the relevant merger control authorities. ASSA ABLOY continues to expect the transaction to close in the 4th quarter 2019

in EUR million 2019 % 2018 % Change
Turnover 192.0 100.0 178.6 100.0 + 7.5%
Gross profit 141.0 73.4 132.7 74.3 + 6.2%
Personnel expenses 84.6 44.1 83.3 46.6 + 1.5%
Structure cost 25.3 13.2 25.4 14.2 - 0.5%
EBITDA 31.9 16.6 24.7 13.8 + 29.3%
Operating profit 23.9 12.4 18.3 10.2 + 30.8%
Financial result (0.9) - (1.1) - - 19.2%
Profit for the period 18.9 9.8 13.4 7.5 + 41.1%

 

Next media release
3rd quarter turnover on 24 October 2019 (after market closing)

First half-year results 2017 – improved profitability

The gross margin increased considerably, benefitting from reduced production costs in France, savings on sourced components and higher production volumes at agtatec.

Growth of personnel costs surpassed sales growth despite steady improvements in France. The higher personnel expenses are also partly due to the integration of HPDS in the U.K.

During the second half of 2017, restructuring costs should remain minimal in France and the U.K. while the focus of the integration of record UK and HPDS will switch to the achievement of synergies and efficiency gains. The pressure on the gross margin from the weakened British Pound should diminish in the second half of 2017.

The group confirms its expectation of sales growth of 4 – 5 % for the full year.

Group key figures (January – June)

In MEUR 30.06.2017 % 30.06.2016 % Change
Turnover 175.5 100.0 166.6 100.0 + 5.3 %
Gross profit 128.6 73.3 119.7 71.8 + 7.4 %
Personnel expenses 83.7 47.7 78.1 46.9 + 7.2 %
Structure cost 25.4 14.5 24.3 14.6 + 4.5 %
EBITA 20.2 11.5 18.0 10.8 + 12.2 %
EBIT 13.3 7.6 11.6 7.0 + 14.7 %
Financial result (0.0) (0.8) (0.5)
Profit for the period 10.2 5.8 8.4 5.0 + 21.4 %

Half-Year Financial Report

The complete half-year financial report 2017 is published online in the shareholders’ section of the Group website: shareholders.agta-record.com.

Solid growth in order intake – Confirmation of 2017 goals

Growth of order intake reached 7.1 % compared to the same period last year which allows the group to confirm its 2017 goals for sales growth (4 – 5 % excluding acquisitions) and EBITDA, the latter expected to improve over-proportionately.

Sales first half-year (1st January – 30th June) – non audited

In EUR million 2017 2016 Change
First quarter 84.5 77.8 + 8.6 %
Second quarter 89.8 89.5 + 0.3 %
Total first half-year 174.3 167.3 + 4.2 %
Thereof maintenance 71.1 68.9 + 3.2 %
at constant exchange rates 175.3 167.3 + 4.8 %


While the first quarter of 2017 includes 3.5 % growth in sales acquired via the HPDS transaction in the U.K. (consolidated since April 2016), the second quarter was impacted by fewer working days, the weakness of the British Pound and an increase in work-in-progress.

The full result of the first half-year is expected to benefit from better gross margins and tight management of structure cost.

The brighter economic outlook and the end of the restructuring efforts in the French and U.K. operations are anticipated to support the profitability of the second half-year.

First quarter sales 2017: Very good start for order intake and sales

Sales growth is mainly due to a good performance of record France (+ 12.5 %) and record UK (+ 29.7 %).

Order intake is up 12.3 %, almost all group subsidiaries reporting satisfying growth.

The decline of the British Pound and the end of reorganisation in France will affect the first half year results.

Overall turnover growth of the Group is anticipated to be 4 ––5 % while EBITDA should grow overproportionately in 2017.

Group Sales (Jan. – Mar.)

in EUR million 2017 2016 Change
Total Sales 84.5 77.8 + 8.5 %
Thereof service & maintenance 34.9 32.7 + 6.6 %
At previous year exchange rates 84.9 78.4 + 9.0 %

Summarised consolidated results 2016

Several non-recurring items had an important impact on the 2016 results: The new production and logistics concept implemented in France in 2016 reduced EBITA by an estimated EUR 5.0 million. The weakness of the Pound Sterling after the Brexit decision negatively impacted EBITA by EUR 0.7 million. The integration of High Performance Door Solutions Ltd. acquired in April 2016 cost EUR 0.8 million. The overproportionate increase of personnel cost was predominantly due to the overstaffing and temporary personnel related to the restructuring in France.

EBITDA and EBITA increased slightly despite these one-time effects benefiting from turnover growth in the product (+?10 % at constant exchange rates, + 3.5 % excluding acquisitions) and service business (+ 9.5 %).

The gross margin was slightly higher than in 2015, despite the negative impacts from the restructuring in France and the weakness of the Pound Sterling.

EBIT declined as a result of the EUR 5.5 million impairment of the goodwill of the product house BLASI GmbH.

The financial result of 2016 was driven by the weakness of Pound Sterling.

The balance sheet of the Group remains very solid, highlighted by liquidity of EUR 50 million and equity of EUR 230 million.

A payment of CHF 1.00 per share (2015: 0.93) for the year 2016 will be proposed to the Annual General Meeting on 7 June 2017.

Group key figures (Jan. – Dec.) – audited

in EUR million 2016 % 2015 % Change
Turnover 351.9 100.0 325.5 100.0 + 8.1 %
Revenue 255.2 72.5 235.2 72.3 + 8.5 %
Personnel expenses 160.7 45.7 144.2 44.3 + 11.4 %
Structure cost 56.3 16.0 53.5 16.4 + 5.3 %
EBITDA 48.3 13.7 46.8 14.4 + 3.1 %
EBITA 40.0 11.4 39.2 12.0 + 2.1 %
EBIT 29.7 8.4 34.9 10.7 – 15.1 %
Financial result – 1.4 – 0.3 – 2.0 – 0.6 + 30.8 %
Profit of the period 21.8 6.2 25.3 7.8 – 14.0 %

Perspectives of 2017

Given the elections in France and the continuing Brexit impact, turnover growth expectations for the business in France and the U.K. are guarded. The lack of non-recurring costs could translate into profitability improvements in the French und U.K. businesses. The business in the Netherlands is also expected to contribute to profitability growth after the integration of the 2015 acquisition of Imtech Toegangstechniek is achieved. Overall turnover growth of the Group is anticipated to be 4 – 5 % while EBITDA should grow overproportionately in 2017.

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