Financière de l'ODet : First half 2020 results

FINANCIERE DE L'ODET                                                                                                                                                         PRESS RELEASE

First half 2020 results July 31, 2020 

Good half-year 2020 results for all business linesdespite the pandemic

Adjusted operating income (EBITA(1)): €943 milion, +3%

Net income : €750 million, +43%

      Of which Groupe share : €84 million, +9%

  • Revenue: €11,612 million, -1%.
  • EBITDA: €1,550 million, +10%
  • Adjusted operating income (EBITA (1)) €943 million, +3%:
·Bolloré Transportation & Logistics €303 million -2%
·Communications (Vivendi): €735 million +2%
·Electricity storage and systems   -€67 million, +18%
  • Net income: €750 million, up by 43% and net income, Group share of €84 million, an increase of +9%. This does not include the gain on the sale of 10% of the share capital of UMG on March 31, 2020, on the basis of an enterprise value of €30 billion for 100% of UMG. The sale was recognized in equity in the amount of €2.8 billion.
  • Net debt: €7,533 million, down by €1,248 million compared to December 31, 2019 (of which Financière de l’Odet, excluding Vivendi: €4,476 million, down -€241 million)

Improved gearing: 30% compared to 37% at the end of 2019 and continued high liquidity of €8.2 billion (of which €2.8 billion for Financière de l’Odet)

 

First half 2020 results

Finanacière de l’Odet's Board of Directors approved the financial statements for the first half of 2020 at its meeting of July 31, 2020.

First-half 2020 revenue was €11,612 million, a decrease of 4% at constant scope and exchange rates (-1% on a reported basis), with:

  • Transportation and Logistics down 2%: 
    • Bolloré Logistics: up 6%, benefiting from the strong performance in air transport which fully absorbed the slight drop in maritime transport;
    • Bolloré Africa Logistics: -13% due to the contraction of logistics activities and the impact of the end of the Douala terminal (DIT) concession in Cameroon. 
  • Oil logistics: down 19%, primarily due to the drop in oil prices; 
  • Communications: down 2%, despite growth at UMG (+4%) which did not fully offset the decline in the other activities; 
  • Electricity Storage and Systems: -8%, notably as a result of the decline in industrial activities in Brittany and at IER, which were impacted by the shutdown. 

Revenue was down 1% in reported data, reflecting €263 million in changes in the scope of consolidation (consolidation of Editis and of M7 by Vivendi and exit of Bolloré Ports France and Wifirst) and €37 million in foreign exchange impacts (primarily due to the rise in the dollar).Adjusted operating income (EBITA (2)) was €943 million, up 3% (-1%) at constant scope and exchange rates):

  • Transportation and Logistics: down 6% as a result of the end of the Douala terminal concession (DIT) in Cameroon and the decline in logistics business in Africa, partially offset by the good performance of freight forwarding, primarily in air, and of maritime terminals; 
  • Oil logistics: up 43% benefiting from higher earnings in distribution and storage; 
  • Communications (Vivendi): up 2% thanks to the excellent performance of UMG and of the Canal+ group; 
  • Electricity Storage and Systems: a €14 million improvement as a result of the impact of the exceptional impairment decided in 2019 as part of the strategic redeployment of batteries, buses and stationary activities.

Financial income was €444 million, compared with €39 million in the first half of 2019. It consists mainly of €449 million for the revaluation of Spotify and Tencent Music securities (compared to €155 million in the first half of 2019).

The share of net income of non-operating companies accounted for using the equity method was -€91 million compared to -€10 million in the first half of 2019. It consists of:

  • An impact of -€160 million on Mediobanca, corresponding to the drop in market price, offset by financial income of +€109 million corresponding to the hedges placed on the securities;
  • +€64 million from Telecom Italia, including the effect of the partial sale of Inwit.

After taking into account a tax expense of €353 million (compared to -€235 million in the first half of 2019), consolidated net income was €750 million, compared with €526 million in the first half of 2019. Net income, Group share was €84 million compared with €77 million in the first half of 2019.

Net debt was €7,533 million compared to €8,781 million on December 31, 2019, down by €1,248 million, of which -€241 million for Bolloré, excluding Vivendi.

Equity totaled €25,138 million (€24,021 million as of December 31, 2019), up by €1,116 million as a result of the sale of 10% of the capital of UMG to Tencent (+€28 billion before expenses and taxes) and despite the negative impact of prices on securities (-€1.0 billion) and buybacks of Group securities (Vivendi and Blue Solutions). The ratio of net debt to equity (gearing) was 30%, compared with 37% at the end of 2019.

As of June 30, 2020, the Group’s liquidity position, including undrawn confirmed lines and liquid investments represented approximately €2.8 billion3 for Bolloré and €8.2 billion including Vivendi.

Group structure:    
  • Sale of 10% of UMG to a consortium led by Tencent 
    • Completion on March 31, 2020 of the sale of 10% of the share capital of UMG to a consortium led by Tencent, on the basis of an enterprise value of €30 billion for 100% of UMG;
    • The consortium led by Tencent has the option to acquire up to an additional 10% of the share capital of UMG until January 15, 2021, on the same valuation basis. 
  • Ongoing buyback of Vivendi shares 
    • Between January 1 and March 6, 2020, Vivendi bought back 23 million shares on the market for a total of €559 million, increasing the total number of shares acquired under the program authorized by the General Shareholders’ Meeting of April 15, 2019 to 131 million shares, i.e. 10% of share capital (as of the date of program implementation);
    • Since the General Shareholders’ Meeting of April 20, 2020, Vivendi has bought back 8.25 million additional shares for a total €160 million.
       
  • Shareholding in Lagardère 
    • As of July 10, Vivendi held 21% of the share capital and 16% of the voting rights of Lagardère SCA. 
  • Bolloré tender offer for Blue Solutions 
    • Finalization of the public tender for Blue Solutions for €17 per share, which took place from May 29 to July 8, 2020;
    • Mandatory squeeze-out on July 15, 2020: Bolloré now holds 100% of Blue Solutions' share capital;
    • The shares acquired are valued at €110 million.
        Health crisis   Although the impact has been greater for some countries and business lines, the Group has been resilient and has adapted to continue to service its customers, while reducing its costs to preserve its margins. The Transportation and Logistics businesses benefited from exceptional freight rates which partially offset the slowdown in normal flows. The communications businesses held up well thanks to music and pay-TV.   The Group is closely monitoring the current and potential consequences of the crisis. At this time, it is difficult to determine how it will impact the annual results. Businesses related to advertising and live entertainment may be more durably impacted than others. However, the Group remains confident about the resilience of its main business lines. It continues to do everything possible to ensure the continuity of its activities and to serve and entertain its customers and audiences, while complying with the instructions of the authorities of each country in which it has a presence.   A review of the value of assets with an indefinite life was completed. With respect to the performance of the CGUs during the first half of the year, the Group did not identify any indications of impairment requiring the implementation of full impairment tests. An analysis was carried out using sensitivity tests to assess their resilience.               ********                             Consolidated key figures for Financière de l’Odet  
 
 
(in millions of euros) 1st half 2020 1st half 2019 Change
Revenue 11,612 11,780 (1%)
EBITDA(1) 1,550 1,410 10%
Depreciation, amortization and provisions (607) (492) (23%)
Adjusted operating income (EBITA(1)) 943 918 3%
Amortization resulting from PPA(1) (194) (186) (4%)
Operating income 749 731 2%
  of which operating equity associates 4 6 (31%)
Financial income 444 39 NA
Share of net income of non-operatingcompanies accounted for under the equity method   (91)   (10)   NA
Taxes (353) (235) (50%)
Net income 750 526 43%
Net income, Group share 84 77 9%
Minorities 666 449 48%
       
  June 30, 2020 December 31, 2019 Change (€ m)
Equity 25,138 24,021 1,116
  Of which Group share 3,697 3,814  
Net debt 7,533 8,781 (1,248)
Gearing (2) 30% 37%  
  1. See Glossary
  2. Gearing: ratio of net debt to equity
Change in revenue by business in the first half  
(in millions of euros) 1st half-year 1st half-year 1st half-year Reported Organic
  2020 2019 (1) 2019 growth   growth
Transportation and Logistics 2,856 2,916 2,974 (4%) (2%)
Oil logistics 1,046 1,286 1,278 (18%) (19%)
Communications 7,574 7,728 7,351 3% (2%)
Electricity Storage and Systems 122 133 160 (23%) (8%)
Other (Agricultural Assets, Holding companies) 13 17 17 (22%) (22%)
Total 11,612 12,080 11,780 (1%) (4%)

(1)      at constant scope and exchange rates

All amounts are expressed in millions of euros and rounded to the nearest decimal. As a result, the sum of the rounded amounts may differ slightly from the reported total.

Change in revenue per quarter  
(in millions of euros) 1st quarter 2nd quarter
  2020 2019 (1) 2019 2020 2019 (1) 2019
Transportation and Logistics 1,394 1,468 1,483 1,462  1,448 1,491
Oil logistics 631 669 665 415 617 613
Communications 3,868 3,706 3,458 3,706 4,022 3,893
Electricity Storage and Systems 65 63 75 58 71 85
Other (Agricultural Assets, Holding companies) 8 8 8 6 9 8
Total 5,966 5,914 5,690 5,646 6,166 6,090

  (1)      at constant scope and exchange rates

All amounts are expressed in millions of euros and rounded to the nearest decimal. As a result, the sum of the rounded amounts may differ slightly from the reported total.

Adjusted operating income by business (EBITA)  
(in millions of euros) 1st half-year 2020 1st half-year 2019  As reported Organic growth   
Bolloré Transportation & Logistics 303 309 (2%) (1%)  
  Transportation and logistics(1) 268 284 (6%) (5%)  
  Oil logistics 35 25 43% 42%  
Communications 735 718 2% (4%)  
Electricity Storage and Systems (67) (81) 18% 22%  
Other (Agricultural Assets, Holding Companies)(1) (28) (28) (1%) (1%)  
Bolloré Group EBITA 943 918 3% (1%)  

            (1)    Before Bolloré trademark fees             

A limited review of the 2020 consolidated financial statements was carried out and the certification report will be issued following approval of the half-year activity report.

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Comparability of financial statements

  • Change in the scope of consolidation
    • Editis has been consolidated by Vivendi since February 1, 2019
    • M7 has been consolidated by the Canal+ group since September 12, 2019
    • Sale of Bolloré Ports France and Wifirst in the second half of 2019 
  • Changes in the main currencies 

                    

  H1 2020   H1 2019 Change
USD 1.10 1.13 3%
GBP 0.87 0.87 (0%)
PLN 4.41 4.29 (3%)
JPY 119.21 124.29 4%
CNY 7.75 7.67 (1%)
ZAR 18.33 16.04 (14%)

 

 

Glossary

  • Organic growth: growth at constant scope and exchange rates.
  • Adjusted operating income (EBITA): operating income before amortization of intangible assets related to business combinations – PPA (purchase price allocation), impairment of goodwill and other intangible assets related to business combinations.
  • EBITDA: operating income before depreciation and amortization.
  • Net financial debt/Net cash position: sum of borrowings at amortized cost, less cash and cash equivalents, cash management financial assets and net derivative financial instruments (assets or liabilities) with an underlying net financial indebtedness, as well as cash deposits backed by borrowings.

The non-GAAP measures defined below should be considered in addition to, and not as a substitute for other GAAP measures of operating and financial performance, and Financière de l’Odet considers these to be relevant indicators of the Group's operational and financial performance. Furthermore, it should be noted that other companies may define and calculate these indicators differently. It is therefore possible that the indicators used by Financière de l’Odet cannot be directly compared with those of other companies.

The percentages changes indicated in this document are calculated in relation to the same period of the preceding fiscal year, unless otherwise stated. Due to rounding in this presentation, the sum of some data may not correspond exactly to the calculated total and the percentage may not correspond to the calculated variation.

1 See glossary

2 See glossary

3 excluding Vivendi.

Attachment

  • 2020-07-31-Odet -CP-résultats S1 2020 EN