Consolidated sales: €196.1m (up 7.5% at
constant exchange rates)
Net income Group share: €15.1m (7.7% of
sales)
Regulatory News:
At its meeting on July 29, 2020, the Vetoquinol S.A.
(Paris:VETO) Board of Directors reviewed the Group results and
approved the first half 2020 financial statements. The auditors
have completed their audit of the financial statements and will
shortly issue their report thereon.
Vetoquinol H1 2020 sales amounted to €196.1 million, up from
€183.8 million in H1 2019, up 6.7% as reported and up 6.2%
like-for-like. Changes in exchange rates had a negative impact
of 0.8% on business in the first half, mainly due to the BRICS
currencies and more specifically the sharp decline in the Brazilian
real, partly offset by the US dollar.
H1 2020 KEY FIGURES
Total sales €196.1m +7.5%
at constant exchange rates
Total Essentials sales
€99.2m +10.7% at constant exchange rates
EBIT before depreciation of
acquired assets €28.0m
Net income - Group share
€15.1m (up €2.1m)
Net cash €91.3m
Sales growth in the first half of 2020 was driven by
Essentials products, which posted organic growth
of10.7%. Essentials products accounted for 50.6% of
Vetoquinol’s sales in the first half of 2020, up from 49.4% in H1
2019.
Sales of companion animal products came to €114.0 million and
accounted for 58.1% of total Vetoquinol sales, up 6.8% at constant
exchange rates. Sales of livestock products came to €82.1 million,
up 8.5% at constant exchange rates. The purchase of Clarion
Biociencias in Brazil on April 15, 2019 contributed €2.5m to H1
2020 growth.
At constant exchange rates, all of the Vetoquinol Group’s
strategic territories posted growth in the first half: the Americas
recorded an increase of 6.5%, while growth of 4.6% in Europe was
mainly driven by France and Spain. Asia-Pacific and export
territories posted growth of 18.7%, driven by the launch of
Essential Boarbetter® in China, offset by a decline in sales in
India due to the challenges presented by the health crisis.
The Vetoquinol Group posted Q2 2020 sales of €92.7m, stable
compared to the reported figure Q2 2019, with organic growth of
1.9%. Europe and the Americas fell 3.3% and 9.5% respectively, as
reported. Sales in Brazil and the US also declined in the second
quarter, reflecting the impact of Covid-19. Asia-Pacific remains on
an upward trajectory, posting solid growth of 31.7% driven by
export markets and China.
The gross margin on purchases came to 72.2%, up 2.8
percentage points compared to H1 2019 (69.4%) due to an increase in
production in the first half of 2020 compared to usual levels, and
a favorable 2019 comparison reference.
External expenses fell €2.5m, primarily due to a decrease in
costs relating to Covid-19 (reduction in marketing and advertising
costs, travel expenses, etc.). Personnel expenses rose 6.5% (€4m),
due to a change in consolidation scope (creation of a subsidiary in
New Zealand and acquisition of Clarion in Brazil), an increase in
wages and the provision for profit-sharing and incentive
schemes.
EBIT before depreciation of acquired assets, a new Vetoquinol
Group performance indicator, amounted to €28.0m in the first
half of 2020, up from €19.2m in the same period in 2019, resulting
in a 4 points increase.
Depreciation of acquired assets amounted to €3.7m, compared to
€1.3m in H1 2019. H1 2020 depreciation includes a €2.2m
depreciation charge as from April 15, 2019 on fixed assets, a
consequence of the purchase price allocation of Clarion.
Vetoquinol Group’s EBIT rose to €24.4m, up from
€17.9m in H1 2019.
In H1 2020, Vetoquinol recorded a net € 1.4m non-recurring
expenses related to goodwill impairment of the FarmVet Systems CGU
(€2.2m), partially offset by a reduction in liabilities owed to
minority shareholders, (non-recurring income of €0.8m).
The apparent tax rate was 33.8% (vs 27.6% in H1 2019) due to the
negative effects recorded in the first half of 2020, primarily due
to an adjustment on India tax carried forward losses, and a
reversal of FarmVet Systems deferred tax assets as well as country
mix effect. The increase of this tax rate combined with the growth
of the EBIT before tax triggers an additional €2.7m income tax
charge.
Vetoquinol posted an €11.8m increase in EBITDA
year-on-year in the first half at €38.0m, resulting from the
increase in sales and gross margin, as well as a reduction in
expenses during Covid-19. H1 2020 EBITDA expressed as a percentage
of sales amounted to 19.4% versus 14.3% in H1 2019.
After non-recurring expenses, Vetoquinol net income amounted
to €15.1m, up from €13.0m in H1 2019.
Total Group net cash stood at €91.3m at June 30, 2020.
Vetoquinol is backed by a sound financial structure to further
its growth strategy and has the funds to pursue its targets for
acquisitions and development, as well as to face the impact of the
Covid-19 health crisis. The Vetoquinol Group was free of financial
debt as of June 30, 2020.
Covid-19
The Group has ensured its staff stay healthy and safe, while
delivering on its production, distribution and service commitments.
The Vetoquinol Group has also introduced a number of measures as
issued by the World Health Organization and governments in
countries where it operates.
The Group will continue to keep its stakeholders regularly
informed of how Covid-19 developments impact its business.
Acquisition of Profender® and Drontal®
The acquisition in Europe and the United Kingdom of these two
de-wormers for cats and dogs is expected to be finalized on Monday
August 3, following the acquisition of Bayer’s animal health
division by Elanco Animal Health.
Vetoquinol CEO Matthieu Frechin said: “The performances recorded
in the first half of 2020 reflect the merits of our development
strategy, which is based on a balance between our strategic
territories and concentrating our efforts on our portfolio of
Essentials products. Since the lockdown at the start of the year,
our top priority has been to ensure the health and safety of our
staff. Our teams are hard at work supporting our vet and breeder
customers, ensuring that the most hygienic conditions possible are
in place wherever we operate. This unprecedented health crisis has
also highlighted the agility and flexibility of our laboratory. Our
portfolio of Essentials products, solid financial structure and
expert teams are what will ensure we overcome this challenging
period. Finally, we are delighted to be finalizing the acquisition
of Profender® and Drontal® next week, which is entirely in line
with our strategy.”
The analyst presentation is scheduled for Thursday, July 30,
2020 and its recording will be available on the Company’s
website.
Next update: Q3 2020 sales, October 15, 2020 after market
close
About Vetoquinol
Vetoquinol is a leading global animal health company that
supplies drugs and non-medicinal products for the livestock (cattle
and pigs) and pet (dogs and cats) markets.
As an independent pure player, Vetoquinol designs, develops and
sells veterinary drugs and non-medicinal products in Europe, the
Americas and the Asia Pacific region.
Since its foundation in 1933, Vetoquinol has pursued a strategy
combining innovation with geographical diversification. The Group's
hybrid growth is driven by the reinforcement of its product
portfolio coupled with acquisitions in high potential growth
markets. At June 30th 2020, Vetoquinol employs 2,401 people.
Vetoquinol has been listed on Euronext Paris since 2006 (symbol:
VETO).
For further information, go to: www.vetoquinol.com.
ANNEX
Summary income statement
€m
06/30/2020
06/30/2019
Change
Total sales
of which Essentials
196.1
99.2
183.8
89.9
+6.7%
+10.3%
EBIT before depreciation of assets arising
from acquisitions
% of total sales
28.0
14.3%
19.2
10.4%
+46.1%
Net income Group share
% of total sales
15.1
7.7%
13.0
7.1%
+15.8%
EBITDA
% of total sales
38.0
19.4%
26.2
14.3%
+44.9%
Calculation of EBITDA
€m
06/30/2020
06/30/2019
Net income before equity method
14.8
12.8
Income tax expense
7.6
4.9
Net financial income/(expense)
0.5
0.3
Provisions recorded under non-recurring
operating income and expenses
2.1
(0.2)
Provisions and write-backs
0.3
(0.3)
Depreciation
10.2
6.7
Depreciation - IFRS
2.4
2.1
EBITDA
38.0
26.2
ALTERNATIVE PERFORMANCE INDICATORS
Vetoquinol Group management considers that these indicators,
which are not defined by IFRS, provide additional information that
is relevant for shareholders seeking to analyze underlying trends
and Group performance and financial position. They are used by
management for performance analysis.
Essentials products: The products referred to as
“Essentials” comprise veterinary drugs and non-medical products
sold by the Vetoquinol Group. They are existing or potential
market-leading products designed to meet the daily requirements of
vets in the companion animal or livestock sector. They are intended
for sale worldwide and their scale effect improves their economic
performance.
Constant exchange rates: Application of the previous
period’s exchange rates to the current financial year, all other
things remaining equal.
Like-for-like growth: Year-on-year sales growth in terms
of volume and/or price at constant exchange rates.
EBIT before depreciation of assets arising from
acquisitions: This KPI isolates the non-cash impact of
amortization charges which result from merger and acquisitions
operations.
Net cash: Cash and cash equivalents less bank overdrafts
and borrowings, pursuant to IFRS 16.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200730005743/en/
VETOQUINOL Investor
Relations Fanny Toillon Tel.: +33 (0)3 84 62 59 88
relations.investisseurs@vetoquinol.com
KEIMA Communication Investor and
Media Relations Emmanuel Dovergne Tel.: +33 (0)1 56 43 44 63
emmanuel.dovergne@keima.fr
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