Financial information at December 31, 2020
The Recylex Group (Euronext Paris: FR0000120388
- RX) is today reporting its sales for the financial year to
December 31, 2020.
Following the filing for insolvency proceedings
under the German law1 on May 14, 2020 by the companies previously
forming the German sub-group, Recylex S.A. definitively lost
control of these entities2, which were consequently fully
deconsolidated as of that date. The published consolidated sales at
December 31, 2020 therefore include the sales generated by these
entities only up to the date of their deconsolidation.
In order to enable comparison with the 2020
figures, the Recylex Group's consolidated revenue for the year
ended December 31, 2019 is also presented in "Pro forma" data, by
restating the revenue of the German entities over the same period
as for the year 2020.
In million of euros |
At December 31, 2020 |
At December 31, 2019 |
At December 31, 2019 |
Change on a published basis (%) |
Change on a pro forma basis (%) |
Lead |
98.9 |
196.4 |
100.2 |
-50% |
-1% |
Zinc |
20.6 |
80.8 |
28.5 |
-74% |
-28% |
Special metals |
5.5 |
16.4 |
5.8 |
-66% |
-5% |
Plastic |
8.9 |
12.1 |
13.9 |
-26% |
-36% |
Total by segment |
133.9 |
305.7 |
148.4 |
-56% |
-10% |
Discontinued operations 3 |
(20.0) |
(68.3) |
(28.0) |
-71% |
-29% |
Consolidated revenues |
113.9 |
237.4 |
120,4 |
-52% |
-5% |
IFRS data, figures unaudited.
Sebastian Rudow, Chairman and Chief
Executive Officer of Recylex S.A, commented:
“The fourth quarter of 2020 was shaped by the
effects of the SARS-CoV-2 pandemic. Lead and zinc prices were
significantly lower than in the same period of the previous year
and the availability of used lead acid batteries was partially
restricted. These events had an impact on our industrial
performance and our ability to deliver. In addition, Recylex S.A.'s
main customer, Weser-Metall GmbH, is still under an insolvency
proceeding. We expect the German insolvency administration to sell
the ongoing business operations in the first half of 2021. However,
this will not necessarily place Recylex S.A. in a financially
stable situation, especially as discussions with the EU Commission
regarding the fine imposed in 2017 are still ongoing and are
expected to last several months. In the context of the
deconsolidation of the former German subgroup, the Recylex Group
has drastically downsized and this fine greatly exceeds its
financial capacities. After negotiations, Glencore International AG
has granted Recylex S.A. a new deferral of its claims, which should
give sufficient time to continue the discussions with the European
Commission to examine possible solutions. In this context, Recylex
S.A. shares are suspended until Recylex is in a position to
communicate reliably on its going concern outlook. In addition to
strengthening our financial situation, the priority remains on
securing new customers and improving our operations.”
- Trend in metal prices at December 31, 2020 (in
euros)
In euros per ton |
Average at December 31, 2020 |
Average at December 31, 2019 |
Change (%) |
Lead price |
1,598 |
1,787 |
-11% |
Zinc price |
1,979 |
2,274 |
-13% |
€/$ exchange rate |
1.1412 |
1.1195 |
2% |
Source: London Metal Exchange.
The average lead price for 2020 was €1,598, down
11% compared to the average for 2019. Between January 2, 2020 and
December 31, 2020, lead prices fell by 6%. During 2020, the lead
price remained below the price observed in 2019, but recovered in
the last quarter of 2020.
The average zinc price for 2020 was €1,979, down
13% compared to the 2019 average. During the first quarter of 2020,
the evolution of the zinc price was marked by a sharp fall, with
the price reaching its annual low point at €1,639 on March 25,
2020. The price trend was then quite volatile in the second quarter
of 2020, but picked up again in the third and fourth quarter of
2020.
The average €/$ exchange rate in 2020 was 2%
higher than that of 2019, at 1.1412.
- Breakdown of consolidated sales at December
31, 2020 relative to December 31, 2019
Consolidated sales at December 31, 2020 amounted
to €113.9 million compared to consolidated sales of €237.4 million
at December 31, 2019 (€120.4 million on a comparable consolidation
scope basis).
2.1 Lead segment
Sales for the year ended in December 31, 2020
totaled €98.9 million, down 50% compared to December 31, 2019 on
reported basis due to the deconsolidation of the German entities.
The evolution of sales on a comparable consolidation scope (pro
forma basis) was nearly stable at -1%. During 2020, Recylex S.A.
recycled approximately 61,000 tonnes of used lead-acid batteries, a
volume that was virtually stable compared to the same period in
2019. Recylex S.A. continues to supply materials to Weser-Metall
GmbH, with prepayments given its ongoing insolvency procedure.
Consolidated sales for the fourth quarter of
2020 totaled €13.0 million, down 74% on a reported basis, again
mainly due to the deconsolidation of the activities of the former
subsidiaries Weser-Metall GmbH and Harz-Metall GmbH, and down 12%
on a comparable basis (pro forma), mainly due to a lower lead price
than in the fourth quarter of 2020.
The business outlook for the used lead-acid
batteries recycling activity - which has now become the Group's
core business - will be highly dependent on the continued activity
of Weser-Metall GmbH and the continued supply of secondary
materials to the Weser-Metall GmbH smelter by Recylex S.A.
Weser-Metall GmbH - which represents the Company's virtually main
customer to date - is now a company outside the Recylex Group and
in an insolvency proceeding4.
While the objective remains to remain a key
supplier to Weser-Metall GmbH in the future, subject to the
uncertain development of this procedure, which is expected to take
several months and of its business model, Recylex S.A. is actively
pursuing its development of other business opportunities.
2.2 Zinc segment
Consolidated sales reached €20.6 million at
December 31, 2020, down 74% compared to December 31, 2019 on a
reported basis due to the deconsolidation of the German entities1
and the sharp fall in the zinc price over the period. Consolidated
sales at December 31, 2020 on a comparable basis (pro forma) were
down 28% compared with the same period in 2019, mainly due to the
sharp fall in zinc prices combined with the deterioration in
commercial conditions.
It should be noted that following the
deconsolidation of the German entities in the context of their
insolvency proceedings under the German law, the Zinc segment
comprises now only the 50% participation in Recytech S.A., whose
sales are not included in the consolidated sales under IFRS, the
company being accounted for using the equity method in the Group's
consolidated financial statements. In the fourth quarter of 2020,
the segment therefore did not record any sales.
2.3 Special Metals segment
Sales reached €5.5 million at December 31, 2020,
down 66% compared to December 31, 2019 on a reported basis and down
5% on a comparable basis (pro forma).
It should be noted that following the
deconsolidation of PPM Pure Metals GmbH given its insolvency
proceedings under the German law, the Special Metals segment no
longer exists within the scope of the Recylex Group's activities.
As a result, the segment did not record any sales in the fourth
quarter of 2020.
2.4 Plastic segment
Sales reached €8.9 million at December 31, 2020,
down 26% compared to December 31, 2019 on a reported basis.
Although the fourth quarter of 2020 showed some
signs of a revitalization in demand, C2P S.A.S.'s activity in
France was penalized by a very sharp slowdown in global demand for
recycled polypropylene throughout 2020, particularly in the
automotive sector weakened by the effects of the SARS-CoV-2
pandemic.
In the fourth quarter of 2020, sales totaled
€2.8 million, down 4%.
It should be noted that following the
deconsolidation of C2P GmbH as part of the insolvency proceedings
under German law, the Plastics segment now consists solely of the
activities of C2P S.A.S. in France.
- Update on the financial
situation
At December 31, 2020, the Group's net debt (new
scope of consolidation1 and excluding IFRS 16 lease debt) amounted
to €44.5 million (€51.1 million for gross debt) and consisted
mainly of:
- The €16.0 million loan from Glencore International AG to
Recylex S.A. in 2014 and capitalized and accrued interest of €1.2
million over the period;
- The outstanding balance of the fine imposed on the Group in
2017 by the European Commission in the amount of €24.7
million;
- Rescheduled liabilities from the continuation plan (finalized
in 2015) and the amount of the claw back clause, for a total of
€9.2 million.
In this context, Recylex S.A.'s ability to
continue its operations as a going concern depends on the
fulfilment of several structuring assumptions5. These assumptions
relate not only to the continuation of business with Weser-Metall
GmbH, but also to the restructuring of Recylex S.A.'s financial and
non-financial debt so that the cost of short and medium-term debt
in the future is compatible with the new and smaller scope of
consolidation as well as future cash generation.
As part of this financial restructuring Recylex
S.A.
- Obtained from Glencore International AG a waiver – under
certain conditions - until January 31, 2022 of its right to
terminate immediately the loan and related accrued interest of
€17.2 million euros and an extension to the same date of maturities
due in the amount of €2.5 million under the claw back clause;
- Solicited from the European Union the temporary suspension of
the fine payment plan and the adjustment of the amount and payment
schedule;
- Obtained on January 15, 2021 from the competent authorities the
postponement of the date of completion of the rehabilitation works
until December 31, 2024.
The trading of the Recylex S.A. ordinary shares
remains suspended until Recylex S.A. is in a position to reliably
communicate on its situation and its capacity to pursue its
activities.
- Forecasted financial agenda
Recylex will keep investors informed of
developments in ongoing discussions with its creditors, including
the European Commission.
Financial information as of March 31, 2020:
Thursday, April 29, 2021 (after the close of trading).
***
APPENDICES
Quarterly evolution of metal prices averages
In euros per ton |
First quarter 2020 |
Second quarter 2020 |
Third quarter 2020 |
Fourth quarter 2020 |
First quarter 2019 |
Second quarter 2019 |
Third quarter 2019 |
Fourth quarter 2019 |
Lead |
1,675 |
1,518 |
1,603 |
1,594 |
1,793 |
1,677 |
1,824 |
1,847 |
Zinc |
1,930 |
1,780 |
1,997 |
2,203 |
2,380 |
2,459 |
2,112 |
2,157 |
Source : London Metal Exchange.
Consolidated sales by quarter and segment
In million of euros |
First quarter 2020 |
Second quarter 2020 |
Third quarter 2020 |
Fourth quarter 2020 |
First quarter 2019 |
Second quarter 2019 |
Third quarter 2019 |
Fourth quarter 2019 |
Lead |
54.0 |
18.1 |
13.9 |
13.0 |
45.8 |
48.3 |
52.8 |
49.4 |
Zinc |
16.7 |
4.0 |
0.0 |
0 |
21.8 |
21.6 |
20.3 |
17.1 |
Special Metals |
4.3 |
1.2 |
0.0 |
0 |
4.6 |
4.5 |
3.9 |
3.5 |
Plastics |
2.9 |
0.8 |
2.2 |
2.8 |
3.6 |
3.3 |
2.4 |
2.9 |
Total |
77.9 |
24.1 |
16.1 |
15.8 |
75.8 |
77.7 |
79.4 |
72.8 |
IFRS data, unaudited figures.
Recylex S.A.’s sales
In million of euros |
At December 31,
2020 |
At December 31,
2019 |
Change (%) |
Lead segment |
50.2 |
60.8 |
-17% |
Services to Group companies |
0.9 |
2.7 |
-66% |
Total sales |
51.1 |
63.5 |
-20% |
IFRS data, unaudited figures.
***
1 See press releases of May 14, 2020, May 20,
2020, June 18, 2020 and October 26, 2020.
2 For more information: Weser-Metall GmbH,
Harz-Metall GmbH, Norzinco GmbH and PPM Pure Metals GmbH as well as
Recylex GmbH, C2P Germany GmbH and Recylex
Grundstücksverwaltungsgesellschaft mbH.
3 During the 2019 financial year, the Group has
begun a process of disposing of non-strategic assets relating to
Norzinco GmbH and PPM Pure-Metals GmbH. The disposal procedures
initiated by the Group continued during the first half of 2020 and
were halted with the filing for insolvency proceedings at the level
of these two entities on May 14, 2020 without the disposals being
finalized. Until the date of loss of control leading to their
deconsolidation, the Group applied the provisions of IFRS 5 for
entities classified as discontinued operations at December 31,
2019, namely Norzinco GmbH and PPM Pure-Metals. See Note 5.7 to the
condensed consolidated financial statements at June 30, 2020.
4 See in particular the press releases of
September 23, 2020 and October 26, 2020 and Note 1 B. " Recylex
S.A.’s financial position and going concern status" to the
condensed consolidated financial statements at June 30, 2020.
5 See Note 1 B. "Recylex S.A.’s financial
position and going concern status", Note 1 E. "Description and
management of the main risks and uncertainties" and Note 2.3 "Going
concern " to the condensed consolidated financial statements at
June 30, 2020.
***
Disclaimer: This press release
may contain forward-looking statements that do not constitute
forecasts regarding results or any other performance indicator, but
rather trends or targets. These statements are by their nature
subject to risks and uncertainties as described in the Company’s
annual report available on its website (www.recylex.fr). Further
information about Recylex is available from its website
(www.recylex.fr).
The summary document of the proceedings
concerning Metaleurop Nord S.A.S. and Recylex S.A. is available on
the Finance section of the Recylex Group website.
This press release is a non-official translation
into English of the press release of the same date issued in French
language and is provided solely for the convenience of
English-speaking users. This press release should be read in
conjunction with and construed in accordance with French law.
***
Raw materials from urban mines
The Recylex Group is a European specialist in
the recycling of lead, zinc and polypropylene.
For more information about the Recylex
Group: www.recylex.eu
***
Press & Investor contact: T +33 (0)158 47 29 91 |
E info@recylex.eu
Recylex S.A. | Registered office: 6 place de la Madeleine |
75008 Paris | France
Administrative office: 79 rue Jean-Jacques Rousseau | 92158
Suresnes Cedex | France
- Recylex S.A. - Financial Information at December 31, 2020