1st half-year results 2019
In the second-half of 2018, worldwide automotive production declined for the first time in 10 years (-4.4%); this decline steepened in the first-half of 2019 (-6.9%). In this context, in the first-half of 2019, Compagnie Plastic Omnium saw its revenue grow 20.7% and its results show good resilience thanks to cost savings plans carried out from the 4th quarter of 2018.
– Group revenue stood at €4,611 million, growing 20.7% at the new Group scope. Like-for-like, it was stable (+0.2%) and outperformed worldwide automotive production by 7.1 points, particularly in China and North America.
– The operating margin reached €281 million (6.6% of revenue), versus €324 million in the first-half of 2018 and €286 million in the second-half of 2018. It held up to the sharp decline and volatility of the market in China, Germany and the United Kingdom.
– After €64 million in additional depreciation on assets supporting future growth (excluding IFRS 16 impact), EBITDA increased by €54 million to reach €511 million.
– Net income, Group share, came in at €155 million and includes €25 million of restructuring costs.
– After €308 million in investments (7.2% of revenue), free cash-flow stood at €30 million. The second-half of 2019 will see lower investments which will represent, as announced, around 6% of revenue for full-year 2019.
– The financial structure is sound, with net debt of €1,021 million representing 46% of shareholders’ equity and 1.1x EBITDA, taking into account the application of IFRS 16 (+€234 million).
In expectation of an estimated 4.5% drop in worldwide automotive production for full-year 2019 (an estimated production of around 87 million vehicles in 2019 versus 91.3 million in 2018), Plastic Omnium strengthened its cost reduction plan.
In these market conditions, the Group is confirming outperformance from its businesses of at least 5 points in 2019 as well as free cash-flow generation of around €200 million. It now expects its operating income to decrease slightly compared to the €610 million achieved in 2018. 2019 EBITDA will show an increase compared to 2018 EBITDA.
Furthermore, on the basis of an independent valuation, Plastic Omnium expects to sell its commercial real estate assets to the real estate company Sofiparc, wholly-owned by Burelle SA which is also the holding company controlling Plastic Omnium. This transaction would enable the non-industrial real estate assets of Plastic Omnium to be rationalized and strengthen its financial structure.
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2019 First-Half results presentation2019 First-Half results report
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