Boulogne-Billancourt (France), July 29th
2020 – Vallourec, a world leader in premium tubular
solutions, today announces its results for the second quarter and
first half of 2020. The consolidated financial information was
presented by Vallourec’s Management Board to its Supervisory Board
on July 28th 2020.
Q2 results: impacted by unprecedented O&G market
situation in North America, while Vallourec’s results in other
regions show strong resilience
- Revenue of €843 million, down 22% year-on-year, mainly driven
by lower Oil & Gas
- EBITDA at €43 million, versus €102 million in Q2 2019, the
decline being essentially located in North America, while other
regions show solid resilience
- Free cash flow consumption of (€77) million versus €16 million
in Q2 2019, including higher restructuring and financial
charges
- Net income of (€493) million includes impairment charges
recorded for (€441) million versus (€21) million in Q2 2019,
reflecting mainly changes in discount rates, and in the long term
market growth assumptions in O&G North America
|
Balance sheet, liquidity and refinancing
- Net debt at €2,326 versus €2,267 million at end of Q1 2020.
Liquidity position at €1,543 million, versus €1,779 at the end of
Q1 2020
- The Group announced on February 19, 2020 its intention to
launch a capital increase of 800 million euros combined with a new
credit line of €800 million.
This operation was adopted by the Shareholders meeting on April 6,
2020. However due to new environment and adverse market conditions
linked to Covid crisis, these refinancing operations were not
carried out. Vallourec continues discussions, in particular with
its reference shareholders and its banks, in order to define a new
refinancing plan, taking into account the consequences of the Covid
and oil markets crises on its activity and allowing it to deal with
its upcoming maturities and rebalance its financial structure |
Continued commercial momentum
- Frame-agreement with Petrobras extended by two years, until
mid-2023, reaffirming our historic partnership
- Large awards in Africa and Middle East for deliveries in
2021
|
Leading ESG performance
- Part of CDP Climate “A list” since 2019 (i.e. among the 2% best
performing companies worldwide)
- Carbon emission targets compliance with Paris agreement
provisions approved by the Scientific Based Target initiative
(SBTi) in June 2020. First O&G company to obtain this
recognition
|
2020 Outlook confirmed
- Outlook supported by resilience levers despite the sharp drop
in North America onshore activity and Industry markets:
- Brazil: offshore activity to accelerate in H2
- Sustained activity from our highly profitable iron ore
mine
- EA-MEA: strong deliveries of high alloys tubes
- Extensive cost cutting actions across the Group
- Full adaptation of variable costs (including direct labor)
- Acceleration of the savings in H2, confirming the full year
target of €130 million savings announced in Q1 2020, o/w €51
million achieved in H1
- Free cash flow targeted positive in H2, including a significant
release of working capital
|
Key figures
H1 2020 |
H1 2019 |
Change |
In € million |
Q2 2020 |
Q2 2019 |
Change |
872 |
1,176 |
-25.9% |
Production shipped (k tons) |
422 |
605 |
-30.2% |
1,696 |
2,109 |
-19.6% |
Revenue |
843 |
1,084 |
-22.2% |
111 |
169 |
-€58m |
EBITDA |
43 |
102 |
-€59m |
6.5% |
8.0% |
-1.5p.p. |
(as a % of revenue) |
5.1% |
9.4% |
-4.3p.p. |
(514) |
(18) |
-€496m |
Operating income (loss) |
(485) |
1 |
-€486m |
(567) |
(167) |
-€400m |
Net income, Group share |
(493) |
(77) |
-€416m |
(258) |
(143) |
-€115m |
Free cash-flow |
(77) |
16 |
-€93m |
2,326 |
2,111 |
+€215m |
Net debt |
2,326 |
2,111 |
+€215m |
Edouard Guinotte, Chairman of the
Management Board, declared:
“As anticipated, the Covid-19 crisis and the
associated drop in oil price significantly impacted our activity in
the second quarter. Oil & Gas onshore in the US was by far the
most affected as well as Industry markets. This was partially
offset by our deliveries of high alloy products in EA-MEA,
sustained output from our iron ore mine, and Oil & Gas activity
in Brazil. In this adverse environment, while our utmost priority
remained to ensure the health and safety of our teams, we kept a
relentless focus on adaptation, cost savings and cash management,
which enabled us to contain cash consumption during the
quarter.
In such market conditions, the commercial
momentum initiated in 2019 continued and translated into a solid
hit ratio on most of our product lines. In Brazil, we signed the
extension of our long-term contract with Petrobras demonstrating
the quality of the products and services offered by Vallourec. We
were also awarded large orders in Middle East and Africa.
Turning to H2 2020, we don’t expect material
improvement in the US or in Industry markets. However, we will
continue to benefit from our levers of resilience. Over the second
half, our backlog of high alloy products in EA-MEA will continue to
support our deliveries of premium OCTG. In Brazil, we should also
continue to benefit from stable volumes and prices of iron ore
while high-end deliveries for offshore will accelerate.
We will also pursue our internal efforts and
expect to reap the benefits of our adaptation and cost savings
measures, we will continue to enforce tight working capital
management and strict capex discipline. As a result, we target a
positive free cash flow in the second half.
I am confident in our ability to get through
this unprecedented crisis notably thanks to the impressive and
untiring commitment demonstrated by our teams.”
I – A REINFORCED RESILIENCE ENHANCED BY
ADAPTATION MEASURES TO FACE AN UNPRECEDENTED CRISIS
The unprecedented fall in oil demand caused by
Covid-19 (c.-20% in Q2 yoy) was not immediately offset by supply
restrictions from OPEC+ and non OPEC+. This led to a fall in oil
price and sharp cuts in capex from operators (c -50% in 2020 in US
onshore, -25% for IOCs/listed companies, less for NOCs).
After its drop in Q2, oil demand is now
rebounding (even if a full recovery will take time) and the reduced
supply is there to stay longer (OPEC+ supply cuts until April
2022). According to IEA, the oil market is expecting to be
undersupplied as from H2 2020, allowing to start reducing
inventories accumulated in H1 2020.
In order to face this unprecedented
crisis and in addition to a restored competitiveness thanks to the
successful implementation of its Transformation Plan, Vallourec
launched extensive costs cutting in order to achieve €130m gross
savings in 2020 on top of the full adaptation of variable
costs.
In North America, the workforce reduction of
more than 1/3 (more than 900 positions) across all plants as well
as support functions is effective since May 2020.
€51 million of gross savings were already
achieved in H1.
The Group benefits from solid areas of
resilience such as in EA-MEA where our diversified customer base
and our restored competitiveness allow the confirmation of the
commercial momentum initiated in 2019. Brazil still shows a growing
offshore activity in 2020, with Petrobras and IOCs having confirmed
their focus on highly prolific pre-salt projects. Finally, the mine
activity remains highly profitable with resilient iron ore prices
and expected output slightly higher than in 2019.
II - CONSOLIDATED REVENUE BY
MARKET
H1 2020 |
H1 2019 |
Change |
At constant exchange rates |
In € million |
Q2 2020 |
Q2 2019 |
Change |
At constant exchange rates |
1,198 |
1,525 |
-21.4% |
-19.8% |
Oil & Gas, Petrochemicals |
585 |
787 |
-25.6% |
-22.7% |
393 |
482 |
-18.5% |
-7.9% |
Industry & Other |
200 |
246 |
-18.6% |
-3.6% |
105 |
102 |
2.6% |
4.3% |
Power Generation |
57 |
52 |
11.2% |
13.4% |
1,696 |
2,109 |
-19.6% |
-15.9% |
Total |
843 |
1,084 |
-22.2% |
-16.7% |
Over the second quarter of 2020,
Vallourec recorded revenue of €843 million, down 22% compared with
the second quarter of 2019 (-17% at constant exchange
rates) with:
- a major volume impact of -30% mainly driven by Oil & Gas in
North America and EA-MEA
- a positive price/mix effect of +14% reflecting a better
price/mix in Oil & Gas in EA-MEA and South America, despite
lower prices in North America
- a currency conversion effect of -6% mainly related to
EUR/BRL.
Over the first half 2020, revenue
totaled €1,696 million, down 20% versus the first half
2019 (-16% at constant exchange rate). Volume effect was
-26%, price/mix effect +10% and currency conversion effect -4%.
Oil & Gas, Petrochemicals (69% of Q2 2020
consolidated revenue)
Oil & Gas revenue reached
€518 million in Q2 2020, a (€205) million
decrease or -28% year-on-year (-26% at constant
exchange rates), reflecting lower revenue from North
America and EA-MEA.
- In North America, Oil & Gas revenue
decrease was driven by lower deliveries due to the unprecedented
decrease in rig count, as well as to lower prices.
- In EA-MEA, Oil & Gas revenue decrease
reflected lower shipments, partially offset by a better price-mix
related notably to high alloy deliveries.
- In South America, Oil & Gas revenue strong
increase reflected a pick-up in offshore deliveries as well as
better price-mix, despite unfavorable currency conversion
effect.
Over the first half 2020,
Oil & Gas revenue totaled €1,070 million,
a (€325) million decrease or -23%
year-on-year (-22% at constant exchange rates).
Petrochemicals revenue was
€67 million in Q2 2020, up 6% year-on-year (+10%
at constant exchange rates) notably due to higher sales in Middle
East Asia and North America. Over the first half
2020, Petrochemicals revenue totaled €128 million, down 1%
year-on-year (+1% at constant exchange rates).
In Q2 2020, revenue for Oil & Gas
and Petrochemicals amounted to €585 million, down 26% compared with
Q2 2019 (-23% at constant exchange rates) due to lower
O&G volumes in North America and EA-MEA. Over the first
half 2020, revenue for Oil & Gas and Petrochemicals totaled
€1,198 million, down 21% compared with H1 2019 (-20% at
constant exchange rates).
Industry & Other (24% of Q2 2020 consolidated
revenue)
Industry & Other revenue
amounted to €200 million in Q2 2020, down 19% year-on-year (-4% at
constant exchange rates):
- In Europe, Industry revenue was down year on year reflecting
lower volumes and prices.
- In South America, Industry & Other revenue was down,
reflecting lower Automotive volumes and unfavorable currency
conversion effect, partially offset by higher volumes in Mechanical
Engineering.
- In Brazil, the increase in iron ore mine revenue reflected both
higher volumes sold (+18% compared to Q2 2019) and resilient
prices, despite an unfavorable conversion currency effect.
Over the first half 2020, Industry &
Other revenue totaled €393 million, down 19%
year-on-year (-8% at constant exchange rates) primarily as
a result of lower shipments as well as unfavorable conversion
currency effect.
Power Generation (7% of Q2 2020 consolidated
revenue)
Power Generation revenue
amounted to €57 million in Q2 2020, up 11% year-on-year (+13% at
constant exchange rates), as a result of timing of project
deliveries.
As a reminder, the closure of the Reisholz site in Germany,
dedicated to coal-fired conventional power plants, will be
effective in H2 2020.
For the first half 2020, revenue totaled €105
million, up 3% year-on-year (+4% at constant exchange rates).
III – CONSOLIDATED RESULTS ANALYSIS
Q2 2020 consolidated results analysis
In Q2 2020, EBITDA reached €43 million
(compared with €102 million in Q2 2019), with a margin at 5.1% of
revenue, as a result of:
- An industrial margin of €136 million, at 16.1% of revenue,
reflecting the lower activity in Oil & Gas notably in North
America and to a smaller extent in Industry, partially offset by i)
savings ii) positive contribution of high alloy deliveries in
EA-MEA and iii) higher mine contribution
- A 21% decrease in sales, general and administrative costs
(SG&A) at €83 million or 9.8% of revenues, reflecting our
adaptation plan
Operating result was negative at (€485)
million compared to €1 million in Q2 2019, notably
impacted by i) an impairment charge of the total amount of the CGUs
North America and Europe goodwills for (€337) million, ii) an
impairment charge for (€104) million related to tangible assets in
Europe. These impairment charges, which are entirely non cash, were
driven by an increase in discount rates for our North America and
European businesses and a downward revision of long term
perspectives in North America O&G, in the context of
difficulties to predict long term market conditions. And iii)
restructuring costs of (€22) million mainly related to the closure
of the Reisholz site in Germany and to Brazil.
Financial result was negative at (€80)
million, a (€19) million increase
compared to (€61) million in Q2 2019, reflecting higher financial
expenses.
Income tax amounted to (€10)
million mainly related to Brazil, compared to (€14)
million in Q2 2019.
This resulted in a net loss, Group
share, of (€493) million, compared to (€77) million in Q2
2019.
H1 2020 consolidated results analysis
In H1 2020, EBITDA reached €111 million,
a €58 million decrease year on year, at 6.5% of revenue,
including:
- An industrial margin of €297 million, down €84 million compared
with H1 2019, reflecting primarily lower activity in Oil & Gas
in North America and in Industry, partially offset by i) savings
ii) positive contribution of high alloy deliveries in EA-MEA and
iii) higher mine contribution.
- Sales, general and administrative costs (SG&A) down 13% at
€173 million, reflecting our adaptation plan, and representing
10.2% of revenue.
Operating result decreased by (€496)
million to a loss of (€514) million, reflecting mainly the
impairment charge recorded in Q2 2020. Higher “asset disposal,
restructuring costs and other” charges (increased by €35 million)
included restructuring provisions related to the closure of the
Reisholz site in Germany, the adaptation plan in North America and
Brazil. Lower depreciation of industrial assets was recorded.
Financial result was negative at (€115)
million, compared to (€122) million in H1 2019, reflecting
higher financial expenses being offset by other financial income,
including mainly the settlement of a dispute in Brazil for €24
million.
Income tax amounted to (€30)
million mainly related to Brazil.
As a result, net loss, Group share,
amounted to (€567) million, compared to (€167) million in
H1 2019.
IV - CASH FLOW & FINANCIAL
POSITION
Cash flow from operating
activitiesIn Q2 2020, cash flow from operating
activities reached (€65) million, compared to €39 million
in Q2 2019, reflecting mainly the lower EBITDA and higher financial
expenses and restructuring cash-out. In H1 2020, cash flow
from operating activities was negative at (€96) million
compared to €10 million in H1 2019, mainly due to the lower EBITDA
and to a lesser extent to higher restructuring cash-out and income
taxes paid.
Operating working capital
requirementOperating working capital requirement
decreased by €20 million in Q2 2020, versus an increase of
(€4) million in Q2 2019, as a result of activity decline. Net
working capital requirement increased to 115 days of sales,
compared to 108 days in Q2 2019, reflecting customer mix and fixed
inventories. In H1 2020, operating working capital
requirement increased by (€99) million versus an increase
of (€117) million in H1 2019.
CapexCapital
expenditure was (€32) million in Q2 2020, in line with
full year envelope, compared to (€19) million in Q2 2019, and was
(€63) million in H1 2020 compared to (€36) million in H1 2019.
Free cash flowAs a result,
in Q2 2020, free cash flow was negative at
(€77) million versus a generation of €16 million in Q2
2019. Free cash flow for H1 2020 was negative at (€258)
million, a decrease of €115 million compared with (€143)
million in H1 2019.
Asset disposals & other
items Asset disposals & other items amounted to €17
million in Q2 2020 and were mostly related to a positive currency
effect on net debt. For H1 2020, they amounted to (€38) million as
a result of negative currency effects on net debt and of the
repayment of leasing debts (IFRS16).
Net debt and liquidityAs at
June 30th 2020, net debt stood at €2,326 million, compared with
€2,267 million on March 31st 2020.As at June 30th 2020, lease debt
stood at €122 million, compared with €115 million on March 31st
2020.Cash as at June 30th 2020 amounted to €1,420 million, and €123
million of the €1,934 million committed bank facilities were
unused.
At the same date, long term debt amounted to
€1,746 million and short-term debt to €2,000 million, including €18
million of commercial paper and €1,811 million drawn from the
€1,934 million committed banking facilities, of which €100 million
maturing in July 2020 and €1,724 million in February 2021.
Based on June 30, 2020 financial results, the
banking covenant ratio, as defined in the banking contracts, would
be at 124%. As it is tested once a year on December 31st, according
to the contracts, this does not affect Vallourec's ability to draw
down its committed banking facilities in 2020.
V – REFINANCING PLAN
The Group announced on February 19, 2020 its
intention to launch a capital increase of 800 million euros
combined with a new credit line of €800 million.
This operation was adopted by the Shareholders
meeting on April 6, 2020. However due to new environment and
adverse market conditions linked to Covid crisis, these refinancing
operations were not carried out. Vallourec continues discussions,
in particular with its reference shareholders and its banks, in
order to define a new refinancing plan, taking into account the
consequences of the Covid and oil markets crises on its activity
and allowing it to deal with its upcoming maturities and rebalance
its financial structure.
VI – 2020 OUTLOOK
Outlook confirmed and supported by
resilience levers.
Oil & Gas
- In EA-MEA, Middle East and North Africa NOC’s
generally maintain sustained activity. Delayed projects mainly from
IOC’s are offset by strong deliveries of high alloys.
- In North America, after the sharp drop in
drilling activity of shale operators (rig count down 70% since
December 19), the rig count is expected to stabilize close to
current level and OCTG prices to remain at a low level.
- In Brazil, the number of drilled wells is
forecasted to increase. As anticipated, deliveries of premium OCTG
are planned to continue to accelerate in H2.
Industry & Other
- In Europe and Brazil, demand from Industry is
expected to continue being impacted by Covid-19 crisis.
- Volume of iron ore produced in Brazil is
expected to be slightly higher than in 2019, while iron ore prices
are so far staying at favourable levels.
Adaptation Measures
- Adjustment of working hours to the activity in each country
(short-time work, furlough,…)
- €130 million gross savings targeted in 2020 of which €51
million already achieved in H1 2020 (In addition to full adaptation
of variable costs, including direct labor).
- 2020 capex envelope reduced by 20% compared to initial
envelope, to c. €160 million.
- Working capital requirements reduction reflecting activity
decline, ongoing action plans and usual seasonality towards the end
of the year.
Free cash flow targeted positive in H2,
including a significant release of working capital.
Information and Forward-Looking Statements
This press release contains forward-looking
statements. These statements include financial forecasts and
estimates as well as assumptions on which they are based,
statements related to projects, objectives and expectations
concerning future operations, products and services or future
performance. Although Vallourec’s management believes that these
forward-looking statements are reasonable, Vallourec cannot
guarantee their accuracy or completeness and these forward-looking
statements are subject to numerous risks and uncertainties that are
difficult to foresee and generally beyond Vallourec’s control,
which may mean that the actual results and developments may differ
significantly from those expressed, induced or forecasted in the
statements. These risks include those developed or identified in
the public documents filed by Vallourec with the AMF, including
those listed in the “Risk Factors” section of the Universal
Registration Document filed with the AMF on March 20th 2020.
Cautionary Statement
This press release does not, and shall not, in
any circumstances constitute a public offering or an invitation to
the public in connection with any offer.
No communication and no information in respect
of this transaction may be distributed to the public in any
jurisdiction where a registration or approval is required. No steps
have been or will be taken in any jurisdiction (other than France)
where such steps would be required. The issue, the subscription for
or the purchase of Vallourec’s shares may be subject to
specific legal or regulatory restrictions in certain jurisdictions.
Vallourec assumes no responsibility for any violation of any such
restrictions by any person.
This announcement is not a prospectus within the
meaning of Regulation (EU) 2017/1129 of the European Parliament and
the Council of June 14, 2017 (as amended or superseded, the
“Prospectus Regulation”). No securities offering will be opened to
the public in France before the delivery of the visa on a
prospectus prepared in compliance with the Prospectus Regulation,
as approved by the AMF.
In France, an offer of securities to the public
may only be made pursuant to a prospectus approved by the AMF. With
respect to the member States of the European Economic Area (each, a
“relevant member State”), other than France, no action has been
undertaken or will be undertaken to make an offer to the public of
the shares requiring a publication of a prospectus in any
relevant member State. Consequently, the securities cannot be
offered and will not be offered in any member State (other than
France), except in accordance with the exemptions set out in
Article 1(4) of the Prospectus Regulation, or in the other case
which does not require the publication by Vallourec of a prospectus
pursuant to the Prospectus Regulation and/or applicable regulation
in the member States.
This press release does not constitute an offer
of the securities to the public in the United Kingdom. The
distribution of this press release is not made, and has not been
approved, by an authorized person (“authorized person”) within the
meaning of Article 21(1) of the Financial Services and Markets Act
2000. As a consequence, this press release is directed only at (x)
persons who (i) are outside the United Kingdom, (ii) have
professional experience in matters relating to investments falling
within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005, as amended (the “Order”), or
(iii) are high net worth entities falling within Article 49(2) of
the Order and (y) any other persons to whom it may otherwise
lawfully be communicated (all such persons together being referred
to as “Relevant Persons”). The securities are directed only at
Relevant Persons and no invitation, offer or agreements to
subscribe, purchase or acquire the securities may be proposed or
made other than with Relevant Persons. Any person other than a
Relevant Person may not act or rely on this document or any
provision thereof. This press release is not a prospectus which has
been approved by the Financial Conduct Authority or any other
United Kingdom regulatory authority for the purposes of Section 85
of the Financial Services and Markets Act 2000.
This press release does not constitute or form a
part of any offer or solicitation to purchase or subscribe for
securities in the United States. Vallourec shares may not be sold
in the United States absent registration or an exemption from
registration under the U.S. Securities Act of 1933, as
amended. Vallourec does not intend to register in the United States
any portion of the offering mentioned in this press
release or to conduct a public offering of the shares in the
United States.
The distribution of this press release in
certain countries may constitute a breach of applicable law. The
information contained in this press release does not constitute an
offer of securities for sale in the United States, Canada,
Australia or Japan.
Presentation of Q2 & H1 2020 results
Analyst conference call / audio webcast at 6:30
pm (Paris time) to be held in English.
- To listen to the audio webcast:
https://channel.royalcast.com/webcast/vallourec-en/20200729_1/
- To participate in the conference call, please dial (password to
use is “Vallourec”):
- +44 (0) 20 3003 2666 (UK)
- +33 (0) 1 7099 4740 (France)
- +1 212 999
6659
(USA)
- Audio webcast replay and slides will be available on the
website at:
https://www.vallourec.com/en/investors
About Vallourec
Vallourec is a world leader in premium tubular
solutions for the energy markets and for demanding industrial
applications such as oil & gas wells in harsh environments, new
generation power plants, challenging architectural projects, and
high-performance mechanical equipment. Vallourec’s pioneering
spirit and cutting edge R&D open new technological frontiers.
With close to 19,000 dedicated and passionate employees in more
than 20 countries, Vallourec works hand-in-hand with its customers
to offer more than just tubes: Vallourec delivers innovative, safe,
competitive and smart tubular solutions, to make every project
possible.
Listed on Euronext in Paris (ISIN code:
FR0013506730, Ticker VK) and eligible for the Deferred Settlement
System (SRD), Vallourec is included in the following indices: SBF
120 and Next 150.
In the United States, Vallourec has established
a sponsored Level 1 American Depositary Receipt (ADR) program (ISIN
code: US92023R2094, Ticker: VLOWY). Parity between ADR and a
Vallourec ordinary share has been set at 5:1.
Calendar
|
|
November 18th 2020 |
Release of third quarter and nine-month 2020 results |
For further information, please
contact:
Investor
relations Jérôme FribouletTel: +33 (0)1 49 09 39
77Investor.relations@vallourec.com |
Press relations Héloïse Rothenbühler Tél: +33 (0)1
41 03 77
50 heloise.rothenbuhler@vallourec.com
|
Individual shareholdersToll Free Number
(from France): 0 805 65 10 10 actionnaires@vallourec.com
|
|
|
|
|
Appendices
Due to rounding, numbers presented throughout this and other
documents may not add up precisely to the totals provided and
percentages may not precisely reflect the absolute figures.
Documents accompanying this release:
- Sales volume
- Forex
- Revenue by geographic region
- Revenue by market
- Summary consolidated income statement
- Summary consolidated balance sheet
- Banking covenant
- Free cash flow
- Cash flow statement
- Definitions of non-GAAP financial data
Sales volume
In
thousands of tons |
2020 |
2019 |
Change |
Q1 |
450 |
571 |
-21.2% |
Q2 |
422 |
605 |
-30.2% |
Q3 |
|
595 |
|
Q4 |
|
520 |
|
Total |
- |
2,291 |
|
Forex
Average
exchange rate |
|
H1 2020 |
H1 2019 |
EUR /
USD |
|
1.10 |
1.13 |
EUR /
BRL |
|
5.41 |
4.34 |
USD /
BRL |
|
4.92 |
3.84 |
Revenue by geographic region
In €
million |
H1 2020 |
As % of revenue |
H1 2019 |
As % of revenue |
Change |
Q2 2020 |
As % of revenue |
Q2 2019 |
As % of revenue |
Change |
Europe |
266 |
15.7% |
311 |
14.7% |
-14.4% |
126 |
14.9% |
157 |
14.5% |
-20.0% |
North
America (Nafta) |
482 |
28.4% |
668 |
31.7% |
-27.9% |
211 |
25.1% |
330 |
30.4% |
-35.9% |
South
America |
323 |
19.1% |
329 |
15.6% |
-1.9% |
172 |
20.4% |
162 |
15.0% |
5.9% |
Asia and
Middle East |
467 |
27.5% |
549 |
26.1% |
-15.1% |
241 |
28.6% |
303 |
27.9% |
-20.4% |
Rest of
the world |
158 |
9.3% |
252 |
11.9% |
-37.1% |
93 |
11.0% |
132 |
12.2% |
-29.6% |
Total |
1,696 |
100% |
2,109 |
100% |
-19.6% |
843 |
100% |
1,084 |
100% |
-22.2% |
Revenue by market
H1 2020 |
As % of revenue |
H1 2019 |
As % of revenue |
Change |
In € million |
Q2 2020 |
As % of revenue |
T2 2019 |
As % of revenue |
Variation |
1,070 |
63.1% |
1,395 |
66.2% |
-23.3% |
Oil & Gas |
518 |
61.5% |
724 |
66.8% |
-28.4% |
128 |
7.5% |
130 |
6.2% |
-1.5% |
Petrochemicals |
67 |
8.0% |
63 |
5.8% |
6.4% |
1,198 |
70.6% |
1,525 |
72.3% |
-21.4% |
Oil & Gas, Petrochemicals |
585 |
69.5% |
787 |
72.6% |
-25.6% |
153 |
9.0% |
202 |
9.6% |
-23.9% |
Mechanicals |
74 |
8.8% |
88 |
8.2% |
-15.8% |
27 |
1.6% |
63 |
3.0% |
-57.3% |
Automotive |
9 |
1.1% |
32 |
3.0% |
-70.6% |
212 |
12.5% |
217 |
10.3% |
-2.2% |
Construction & Other |
116 |
13.8% |
125 |
11.5% |
-7.2% |
393 |
23.2% |
482 |
22.9% |
-18.5% |
Industry & Other |
200 |
23.7% |
245 |
22.7% |
-18.6% |
105 |
6.2% |
102 |
4.8% |
2.6% |
Power Generation |
57 |
6.8% |
52 |
4.8% |
11.2% |
1,696 |
100% |
2,109 |
100% |
-19.6% |
Total |
843 |
100% |
1,084 |
100% |
-22.2% |
Summary consolidated income statement
H1 2020 |
H1 2019 |
Change |
In € million |
Q2 2020 |
Q2 2019 |
Change |
1,696 |
2,109 |
-19.6% |
Revenue |
843 |
1,084 |
-22.2% |
(1,399) |
(1,728) |
-19.0% |
Cost of sales |
(707) |
(871) |
-18.8% |
297 |
381 |
-22.0% |
Industrial Margin |
136 |
213 |
-36.2% |
17.5% |
18.1% |
-0.6p.p. |
(as a % of revenue) |
16.1% |
19.6% |
-3.5p.p. |
(173) |
(198) |
-12.6% |
Sales, general and administrative costs |
(83) |
(105) |
-21.0% |
(13) |
(14) |
na |
Others |
(10) |
(6) |
na |
111 |
169 |
-€58m |
EBITDA |
43 |
102 |
-€59m |
6.5% |
8.0% |
-1.5p.p. |
(as a % of revenue) |
5.1% |
9.4% |
-4.3p.p. |
(111) |
(126) |
-11.9% |
Depreciation of industrial assets |
(52) |
(60) |
-13.3% |
(27) |
(29) |
na |
Amortization and other depreciation |
(13) |
(14) |
na |
(441) |
(21) |
na |
Impairment of assets |
(441) |
(21) |
na |
(46) |
(11) |
na |
Asset disposals, restructuring costs and non-recurring items |
(22) |
(6) |
na |
(514) |
(18) |
-€496m |
Operating income (loss) |
(485) |
1 |
-€486m |
(115) |
(122) |
-5.7% |
Financial income/(loss) |
(80) |
(61) |
31.1% |
(629) |
(140) |
-€489m |
Pre-tax income (loss) |
(565) |
(60) |
-€505m |
(30) |
(22) |
na |
Income tax |
(10) |
(14) |
na |
(1) |
(1) |
na |
Share in net income/(loss) of equity affiliates |
- |
- |
na |
(660) |
(163) |
-€497m |
Net income |
(575) |
(74) |
-€501m |
(93) |
4 |
na |
Attributable to non-controlling interests |
(82) |
3 |
na |
(567) |
(167) |
-€400m |
Net income, Group share |
(493) |
(77) |
-€416m |
(49.6) |
(0.4) |
na |
Net earnings per share (in €) * |
(43.1) |
(0.2) |
na |
na = not applicable* H1 and Q2 2020 figures adjusted for new
number of shares following reverse stock split effective on May 25
2020
Summary consolidated balance sheet
In € million |
|
|
|
|
|
Assets |
6/30/2020 |
12/31/2019 |
Liabilities |
6/30/2020 |
12/31/2019 |
|
|
|
Equity -
Group share * |
561 |
1,467 |
|
|
|
Non-controlling interests |
386 |
513 |
Net
intangible assets |
58 |
63 |
Total equity |
947 |
1,980 |
Goodwill |
26 |
364 |
Shareholder loan |
16 |
21 |
Net
property, plant and equipment |
2,266 |
2,642 |
Bank
loans and other borrowings (A) |
1,746 |
1,747 |
Biological assets |
45 |
62 |
Lease
debt (D) |
95 |
104 |
Equity
affiliates |
128 |
129 |
Employee
benefit commitments |
220 |
228 |
Other
non-current assets |
110 |
132 |
Deferred
taxes |
10 |
9 |
Deferred
taxes |
207 |
249 |
Provisions and other long-term liabilities |
73 |
61 |
Total non-current assets |
2,840 |
3,641 |
Total non-current liabilities |
2,144 |
2,149 |
Inventories |
963 |
988 |
Provisions |
93 |
121 |
Trade and
other receivables |
600 |
638 |
Overdraft
and other short-term borrowings (B) |
2,000 |
2,077 |
Derivatives - assets |
11 |
7 |
Lease
debt (E) |
27 |
30 |
Other
current assets |
193 |
237 |
Trade
payables |
504 |
580 |
Cash and cash
equivalents (C) |
1,420 |
1,794 |
Derivatives - liabilities |
17 |
18 |
Other
current liabilities |
279 |
329 |
Total current assets |
3,187 |
3,664 |
Total current liabilities |
2,920 |
3,155 |
Total assets |
6,027 |
7,305 |
Total equity and liabilities |
6,027 |
7,305 |
|
|
|
|
|
|
* Net income (loss), Group share |
(567) |
(338) |
|
|
|
|
|
|
|
|
|
Net debt (A+B-C) |
2,326 |
2,031 |
|
|
|
|
|
|
|
|
|
Lease debt (D+E) |
122 |
134 |
|
|
|
Banking
covenant
As defined in the banking agreements, the
“banking covenant” ratio is the ratio of the Group’s consolidated
net debt including the “financial lease debt” and
the shareholder loan in Brazil to the Group’s equity, restated for
reserves of changes in fair value of financial instruments and
foreign currency translation reserve. This indebtedness ratio is
tested once a year on December 31st, and must be below a limit of
100% on this date.
Banking covenant (in € million) |
|
6/30/2020 |
12/31/2019 |
Net debt
(excluding financial lease debt) |
|
2,326 |
2,031 |
Financial
lease debt |
|
35 |
50 |
Net
debt |
|
2,361 |
2,081 |
Shareholder loan |
|
16 |
21 |
Restated
net debt (1) |
|
2,376 |
2,102 |
Equity |
|
947 |
1,980 |
Foreign
currency translation reserve - Group share (a) |
|
968 |
608 |
Reserves
- changes in fair value of financial instruments (a) |
|
4 |
(4) |
Equity
restated (2) |
|
1,919 |
2,584 |
Ratio of
banking covenant restated (1)/(2) |
|
124% |
81% |
(a) Including
minority interests. |
|
|
|
Free cash flow
H1 2020 |
H1 2019 |
Change |
In € million |
Q2 2020 |
Q2 2019 |
Change |
(96) |
10 |
-€106m |
Cash flow from operating activities (A) |
(65) |
39 |
-€104m |
(99) |
(117) |
+€18m |
Change in operating WCR [+ decrease, (increase)] (B) |
20 |
(4) |
+€24m |
(63) |
(36) |
-€27m |
Gross capital expenditure (C) |
(32) |
(19) |
-€13m |
(258) |
(143) |
-€115m |
Free cash flow (A)+(B)+(C) |
(77) |
16 |
-€93m |
Cash flow statement
H1 2020 |
H1 2019 |
In € million |
Q2 2020 |
Q2 2019 |
(96) |
10 |
Cash flow from operating activities |
(65) |
39 |
(99) |
(117) |
Change in operating WCR [+ decrease, (increase)] |
20 |
(4) |
(195) |
(107) |
Net cash flow from operating activities |
(45) |
35 |
(63) |
(36) |
Gross capital expenditure |
(32) |
(19) |
(38) |
31 |
Asset disposals & other items |
17 |
(2) |
(296) |
(112) |
Change in net debt [+ decrease, (increase)] |
(60) |
14 |
2,326 |
2,111 |
Financial net debt (end of period) |
2,326 |
2,111 |
Definitions of non-GAAP financial
data
Banking
covenant: as defined in the banking
agreements, the “banking covenant” ratio is the ratio of the
Group’s consolidated net debt including the “financial
lease debt” and the shareholder loan in Brazil to the Group’s
equity, restated for reserves of changes in fair value of financial
instruments and foreign currency translation reserve. This
indebtedness ratio is tested once a year on December 31st, and must
be below a limit of 100% on this date.
Data at constant exchange
rates: the data presented « at constant exchange
rates » is calculated by eliminating the translation effect
into euros for the revenue of the Group’s entities whose functional
currency is not the euro. The translation effect is eliminated by
applying Year N-1 exchange rates to Year N revenue of the
contemplated entities.
Free cash flow: Free cash-flow
(FCF) is defined as cash flow from operating activities minus gross
capital expenditure and plus/minus change in operating working
capital requirement.
Gross capital expenditure:
gross capital expenditure is defined as the sum of cash outflows
for acquisitions of property, plant and equipment and intangible
assets and cash outflows for acquisitions of biological assets.
Industrial margin: the
industrial margin is defined as the difference between revenue and
cost of sales (i.e. after allocation of industrial variable costs
and industrial fixed costs), before depreciation.
Lease debt: defined as the present value of
unavoidable future lease payments
Net debt: consolidated net debt
is defined as Bank loans and other borrowings plus Overdrafts and
other short-term borrowings minus Cash and cash equivalents. Net
debt excludes lease debt.
Net working capital
requirement: defined as working capital requirement net of
provisions for inventories and trade receivables; net working
capital requirement days are computed on an annualized quarterly
sales basis.
Operating working capital
requirement: includes working capital requirement as well
as other receivables and payables.
Working capital requirement:
defined as trade receivables plus inventories minus trade payables
(excluding provisions).
- Vallourec-press-release-H1-2020
Vallourec (EU:VK)
Gráfico Histórico do Ativo
De Mar 2024 até Abr 2024
Vallourec (EU:VK)
Gráfico Histórico do Ativo
De Abr 2023 até Abr 2024