Bonduelle - 2019-2020 Annual results: Increasing revenue and
resilient profitability in an exceptional context
BONDUELLE
A French SCA (Partnership Limited by Shares) with
a capital of 56 942 095 EurosHead Office: La Woestyne 59173
Renescure, FranceRegistered under number: 447 250 044
(Dunkerque Commercial and Companies Register)
2019-2020 Annual
Results(July 1, 2019 - June 30, 2020)
Increasing revenue and resilient
profitability in an exceptional
context
- Annual revenue growth in line with initial objectives
- Profitability below target due to the health crisis
- Covid-19: contrasting situations and consequences depending on
technologies and distribution channels
- Solid balance sheet structure and financial ratios
- The controlling family shareholder, the directors and the
management of the company united in the Covid-19 crisis
On September 25, 2020, the Supervisory Board,
under the chairmanship of Martin Ducroquet, reviewed the statutory
and consolidated financial statements for FY 2019 - 2020 as
approved by the General Management and certified by the company's
statutory Auditors.
Significant Results
Consolidated Accounts(in €
millions) |
2019-2020 |
2018-2019 |
Variations |
Revenues |
2,854.9 |
2,777.1 |
+2.8% |
Current Operating Income |
108.7 |
123.7 |
-12.1% |
Net Result |
54.6 |
72.6 |
-24.8% |
The Bonduelle group is once again posting a
revenue growth in 2019-2020 despite an unprecedented health crisis
that had a contrasting impact on business in the second half of the
year, these circumstances adversely affecting the group's
profitability. Nevertheless, its performance and financial health
remain solid.This sanitary crisis has highlighted, as a major
player of the in the agri-food industry, the commitment of all the
group's employees to ensure the continuity of supply to the markets
as much as the values of solidarity that animate them. This
performance demonstrates the relevance of a diversified portfolio
of activities in terms of technologies, distribution channels,
geographies and long-term strategy.
Revenue
The Bonduelle Group's revenue for FY 2019-2020
(July 1, 2019 - June 30, 2020) stands at € 2,854.9 million, an
increase of +2.8% on reported figures and +1.4% on a like-for-like
basis(1).
Activity by Geographic
Region
Total Consolidated Revenue(in €
millions) |
2019-2020 |
2018-2019 |
VariationsReported figures |
VariationsLike for like
basis(1) |
Europe Zone |
1,299.5 |
1,297.- |
+0.2% |
+0.3% |
Non-Europe Zone |
1,555.3 |
1,480.1 |
+5.1% |
+2.3% |
Total |
2,854.9 |
2,777.1 |
+2.8% |
+1.4% |
Activity by Operating
Segment
Total Consolidated Revenue(in €
millions) |
2019-2020 |
2018-2019 |
VariationsReported figures |
VariationsLike for like
basis(1) |
Canned |
1,121.5 |
1,023.4 |
+9.6% |
+9.1% |
Frozen |
685.- |
657.9 |
+4.1% |
+2.2% |
Fresh Processed |
1,048.4 |
1,095.8 |
-4.3% |
-6.3% |
Total |
2,854.9 |
2,777.1 |
+2.8% |
+1.4% |
Europe ZoneThe Europe Zone,
representing 45.5% of the group's revenue over the FY, was stable
overall, at +0.2% on reported figures and +0.3% on like-for-like
basis(1).While the beginning of the financial year was marked by a
growth in canned and frozen branded products (Bonduelle and
Cassegrain), and a slight decline in the fresh operating segment,
the sanitary crisis linked to the Covid-19 pandemic has accentuated
this trend, with a drop in shelf traffic and an increase in home
consumption mainly benefiting the so-called long life products to
the detriment of the fresh products. The food service business
activity (commercial catering and social catering), which was
growing cumulatively at the end of February, was strongly impacted
by the lockdown measures, mainly in frozen and fresh foods.In an
environment marked by the Covid-19 pandemic, the strong performance
of the canned, fuelled by the group's brands, is not enough to
offset the difficulties observed in the fresh segment and the food
service business activity, still stricken, even if a slow but
gradual recovery is noticed at the very end of the period.
Non-Europe ZoneThe revenue of
the non-Europe zone, representing 54.5% of the group's revenue, was
up +5.1% on reported figures and +2.3% on like-for-like
basis(1).Prior to the Spring sanitary crisis, the non-Europe
business activity was buoyed by sustained growth in Eurasia, on the
one hand, thanks to innovations under the Bonduelle brand, and in
North America on the other hand, through capacities regained in the
long life business activity with the ramp-up of the packaging site
in Lebanon (Pennsylvania, USA), and comparison bases that have
become normalized for the fresh business (bagged salads, meal
solutions). In the 2nd and 3rd quarters, all three technologies
posted positive growth rates, with the sanitary crisis impacting
these areas later.In the context of the sanitary crisis, even
though long the life business activities have benefited from
precautionary purchases by consumers coupled then with a sustained
level of activity, the lockdown measures leading to the abrupt
shutdown of the food service business activities are weighing on
the growth of the revenue. In the United States, the fresh food
segment, which is oriented towards nomadic consumption habits
("bowls"), is particularly affected by the sanitary crisis and its
related lockdown measures, even if an upturn in consumption was
observed in June.
Operating Profitability
(in € million) |
2019-2020Reported figures |
2018-2019Reported figures |
VariationsReported figures |
VariationsLike for like
basis(1) |
Revenue |
2,854.9 |
2,777.1 |
+2.8% |
+1.4% |
Current Operating Profitability |
108.7 |
123.7 |
-12.1% |
-13.4% |
Current Operating Margin Rate |
3.8% |
4.5% |
-0.7bps |
-0.7bps |
For FY 2019-2020, the Bonduelle Group’s current
operating income stands at € 108.7 million compared to € 123.7
million the previous financial year, penalized by the Covid-19
global health crisis and whose impact on the group's profitability
is estimated between € 7 and € 10 million, explanatory factor for
the variance with the profitability target announced in October
2019.This impact mainly includes the additional costs generated by
the employee protection measures put in place (social distancing,
sanitation, equipment,...) resulting in lower productivity, losses
related to compliance with agricultural commitments, in particular
in costs, commitment bonuses paid to factory staff , partially
offset by savings (travel expenses, marketing in particular).Both
long-life (canned and frozen) and fresh ready-to-eat (bagged
salads, deli salads, salad bowls) activities were impacted by
additional costs in varying proportions. The long-life product
business segment was able to offset those additional costs thanks
to an increase in activity, particularly in Europe due to the share
of nationally branded products (Bonduelle, Cassegrain) in the
product portfolio compared to the Americas, where private label
sales predominate. On the other hand, the fresh ready-to-eat
business segment saw a decline in revenues in addition to
additional costs, leading to a deterioration in its profitability,
particularly in North America due to the relative size of this
segment in this region. Despite this context and the trend observed
in its profitability, the Group did not significantly reduce its
marketing investments compared to the previous year.After taking
into account non-recurring items (€ 6.8 million), mainly linked to
a health warning in the United States in the fresh food segment
that impacted the entire market in the first half of the year, the
Bonduelle Group's operating income amounts to € 101.9 million,
compared with € 115.8 million last financial year.
Net Result
The net financial expense stands at € 25.9
million against € 22.6 million last financial year. A variation of
€ 2.5 million explained by the application of IFRS 16 regulating
financial leases, and of € 2.4 million attributable to the negative
impact of exchange rates. Income tax expense, corresponding to
interests paid on the group's various financing arrangements, is
down by € 1.6 million. The group's average cost of financing,
already competitive at 2.15%, may be reduced further in the future,
thanks to the Neu CP program set up over the summer.The income tax
expense amounts to € 21.3 million against € 20.6 million last
financial year and represents an effective tax rate of 28.1%.After
taking into account the tax charge and financial income, the
Bonduelle Group's net income for FY 2019-2020 amounts to € 54.6
million, compared with € 72.6 million last financial year.
Financial Situation
|
June 30, 2017 |
June 30, 2018 |
June 30, 2019 |
June 30, 2020Eclud. IFRS 16
Norm |
June 30, 2020Reported
figures |
Net debt (in millions of euro) |
661.6 |
617.4 |
654.7 |
631.- |
715.2 |
Gearing(2) |
1.09 |
0.95 |
0.90 |
0.89 |
1.- |
Leverage ratio(3) |
3.53x |
2.91x |
3.07x |
3.19 |
3.24 |
Despite the various acquisitions of activities
realized over the financial year (Soléal, Elementaree), the
Bonduelle Group posts a decrease in net debt, from € 654.7 million
at the end of the previous financial year to € 631.- million on
June 30, 2020, excluding the impact of the application of IFRS 16,
a debt leverage of 3.19x (compared to 3.07x the previous financial
year) and a gearing(2) still down to 0.89 compared to 0.90 the year
before.Once IFRS 16 is taken into account, the group's debt stands
at € 715.2 million and leverage at 3.2x. The average cost of debt
is down to 2.15% against 2.41% last financial year.
Significant events of the financial year and subsequent
events
The controlling family shareholder, the
directors and the management of the company united in the Covid-19
crisisIn accordance with the press release dated May 29,
2020, a 20% reduction in the group's usual pay-out ratios will be
proposed at the Annual Shareholders' Meeting on December 3, 2020
for the 2019-2020 financial year dividend. This project has
received the support of the Supervisory Board. The members of
Bonduelle SCA's Supervisory Board and Bonduelle SA's Board of
Directors decided to waive 20% of their directors' fees. The
Chairman and the members of the Executive Board, for their part,
reduced their fixed remuneration by 20% over the lockdown
period.These sums help finance the bonus for employees who have
never stopped working in the plant and have proudly committed
themselves, setting aside their legitimate concerns, to ensuring
access to food for all. The sums collected also make it possible to
compensate for the loss of salary of employees with the lowest
level of remuneration and to help employees facing difficult
medical situations.
Bonduelle, a founding member of the B
Movement BuildersInspired by the leadership of the global
Certified B Corporation community, the B Movement Builders is a
coalition of purpose-driven, multinational, publicly traded
companies with a vision of transforming the global economy to
support long-term value creation for all stakeholders. This
initiative is the first of its kind. Together, the founding
companies have a total turnover of approximately 60 billion US
dollars and 250,000 employees.The founding B Movement Builders are
the Bonduelle Group the steel maker Gerdau, the fragrance and
flavour company Givaudan, and the retailer Magalu, with Danone and
Natura&Co as mentors. Although the certification does not focus
on performance, companies wishing to join the B Movement Builders
undergo an initial screen for eligibility. Their ongoing efforts
will be overseen by the B Lab's independent Standards Advisory
Board. This approach is in line with the group's ambition to be a
company that is not the best in the world, but the best for the
world and its quest for B Corp certification by 2025.In this
context, the General Management will propose the inclusion of its
"raison d'être" in the articles of incorporation of Bonduelle SCA
at its Annual General Meeting on December 3, 2020.
Bonduelle optimizes its financing
through the implementation of a Neu CP program of € 300
million.In a logic of constant search for optimization of
its financing instruments, Bonduelle has set up a short-term
negotiable debt securities program (Neu CP) of € 300 million. The
inaugural issue was carried out on July 29, 2020 on particularly
competitive terms, highlighting once again the investors'
confidence in the group's financial strength.This program,
providing access to a new disintermediated and flexible short-term
financing resource, replaces the confirmed financing lines that
remain available to the group.
Acquisition of a joint minority stake in
the Russian start-up ElementareeBonduelle announced on May
4, 2020 that it has participated in a funding round in partnership
with the Russian Direct Investment Fund (RDIF), the sovereign
wealth fund of the Russian Federation, and took a minority stake in
the capital of Elementaree, a company that manufactures and
delivers ready-to-cook meal kits, one of the leaders in the
fast-growing market for meal kits in the Moscow and St. Petersburg
conurbations. This operation, of a limited financial amount,
illustrates the Bonduelle Group's ambitions to be the world
reference in "well-living" through vegetable products, illustrated
here via direct marketing to consumers through innovative
channels.
Change in the shareholding structure for
the Soléal company (France)Established for more than 40
years in South-West of France, Bonduelle, a 48% shareholder of the
Soléal company, acquired in July 2019 most of the interests of the
Euralis, Maïsadour and Vivadour cooperatives held in the
company.The Soléal company includes 2 sweet corn and vegetable
processing plants located in the South-West of France (Labenne and
Bordères). Changes in the ownership of Soléal include some sourcing
commitments, will strengthen the long term partnership with
growers, and increase the competitiveness of the Bonduelle
Group.
Outlooks
The assessment of the group's performance in
terms of both growth and profitability will be intricately linked
to the evolution of the sanitary crisis and the economic and
consumer context. Based on the absence of a deterioration in the
health situation and a gradual recovery in the food service
business activity, the group has set an objective of sales growth
on a like-for-like basis(1) and a current operating margin rate
substantially equivalent to last year.In accordance with the
commitments made, the General Management will propose a dividend of
0.40 euro at the Annual General Meeting on December 3, 2020. During
this Annual General Meeting, the General Management will propose a
capital increase dedicated to its partner farmers in a logic of
sharing value creation.
(1) at constant currency exchange rate and scope
of consolidation basis. The revenues in foreign currency over the
given period are translated into the rate of exchange for the
comparable period. The impact of business acquisitions (or gain of
control) and divestments is restated as follows
- For businesses acquired (or gain of control) during the current
period, revenue generated since the acquisition date is excluded
from the organic growth calculation;
- For businesses acquired (or gain of control) during the prior
fiscal year, revenue generated during the current period up until
the first anniversary date of the acquisition is excluded;
- For businesses divested (or loss of control) during the prior
fiscal year, revenue generated in the comparative period of the
prior fiscal year until the divestment date is excluded;
- For businesses divested (or loss of control) during the current
fiscal year, revenue generated in the period commencing 12 months
before the divestment date up to the end of the comparative period
of the prior fiscal year is excluded.
(2) net financial debt / equity(3) net
financial debt / recurring EBITDA
Alternative performance indicators: the group
presents in its financial notices performance indicators not
defined by accounting standards. The main performance indicators
are detailed in the financial reports available on
www.bonduelle.com.
Next financial events:
- 2020-2021 1st Quarter Revenue:
November 5, 2020 (after stock exchange trading session)- Annual
General
Meeting:
December 3, 2020- 2020-2021 1st Half Year
Revenue:
February 1, 2021 (after stock exchange trading session)- 2020-2021
1st Half Year
Results:
February 26, 2021 (prior to stock exchange trading session)
Find the complete annual results and the
financial notices calendar on
www.bonduelle.com
About
Bonduelle
Bonduelle, a family
business, was established in 1853. Its mission is to be the world
reference in "well-living" through plant-based food. Prioritizing
innovation and long-term vision, the group is diversifying its
operations and geographical presence. Its vegetables, grown over
almost 120,000 hectares all over the world, are sold in 100
countries under various brand names and through various
distribution channels and technologies. An expert in agro-industry
with 56 industrial sites or owned agricultural production sites,
Bonduelle produces quality products by selecting the best crop
areas close to its customers.
Bonduelle is listed on
Euronext compartment BEuronext indices: CAC MID & SMALL - CAC
FOOD PRODUCERS - CAC ALL SHARESBonduelle is part of the Gaïa
non-financial performance index and employee shareholder index
(I.A.S.)Code ISIN : FR0000063935 - Code Reuters : BOND.PA - Code
Bloomberg : BON FP
Find out about the
group’s current events and news on Twitter @Bonduelle_Group, and
its financial news on @BonduelleCFO
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