Jacquet Metal Service: Third Quarter 2015

  • Sales €378m (up 35.4% vs Q3 2014)
  • Adjusted EBITDA €9.4m
  • Net income (Group share) €48.7m

Integration of Schmolz+Bickenbach distribution

SAINT-PRIEST, France--()--Regulatory News:

Jacquet Metal Service (Paris:JCQ):

On November 12, 2015, the Board of Directors, chaired by Eric Jacquet, examined the unaudited consolidated financial statements for the nine months ended September 30, 2015.

           
€ millions Q3 2015 (1) Q3 2014 2015 9-month (1) 2014 9-month
Sales 378.0 279.2 1,000.8 856.8
Gross margin 78.2 69.4 228.7 212.2
% of sales 20.7% 24.9% 22.8% 24.8%
Adjusted EBITDA (2) 9.4 16.4 37.4 46.4
% of sales 2.5% 5.9% 3.7% 5.4%
Operating income before non-recurring items 3.7 12.5 24.4 34.5
% of sales 0.9% 4.5% 2.4% 4.0%
Operating income 52.7 12.5 73.3 34.6
Net income (Group share) 48.7 6.9 59.6 18.1

(1) Including the distribution business purchased from Schmolz+Bickenbach from July 22, 2015
(2) Adjusted for non-recurring items (non-IFRS financial indicators)

Third quarter 2015 sales and earnings

On July 22, 2015, via its IMS group division, the Group acquired certain Schmolz+Bickenbach group's distribution businesses, based mainly in Germany. The business generates annual sales of around €600 million. The new operations are consolidated in the Group financial statements from July 22, 2015.

Group third quarter sales including this acquisition amounted to €378.0 million, +35.4% higher than Q3 2014:

  • volume effect at constant consolidation: up 3.1%; all divisions increased their volumes distributed (Jacquet-Abraservice +9.9%, Stappert +0.2%, IMS group +2.1%),
  • change in consolidation: up 39.6%, mainly due to the Schmolz+Bickenbach distribution acquisition (sales of €104 million recorded between July 22 and September 30, 2015),
  • price effect: down 7.3%; the third quarter was marked by a decline in raw material prices that had a knock-on effect on sale prices.

The consolidated gross margin rate amounted to 20.7% of sales (22.9% at constant consolidation) versus 24.9% in Q3 2014.

EBITDA adjusted for non-recurring items came to €9.4 million (2.5% of sales) and operating income before non-recurring items amounted to €3.7 million.

Third quarter operating income amounted to €52.7 million, which includes non-recurring expenses of €8.5 million mainly related to the Schmolz+Bickenbach distribution acquisition. It includes a provisional €57 million badwill gain arising from first consolidation.

Third quarter net income (Group share) came to €48.7 million.

Acting in an environment characterized by low prices, the Group is focusing on continuously improving the operating efficiency of its divisions and, in particular, turning round the Schmolz+Bickenbach distribution companies currently generating insufficient results.

Sales and earnings for the period ended September 30, 2015

Sales for the nine months ended September 30, 2015 amounted to €1,000.8 million, up 16.8% versus the same period in 2014 (+17.9% volume effect, including a 3.4% volume increase at constant consolidation and consolidation changes of +14.5%; -1.1% price effect).

EBITDA adjusted for non-recurring items came to €37.4 million (3.7% of sales), operating income to €73.3 million and net income (Group share) was €59.6 million.

Proforma sales for the period ended September 30, 2015 (i.e. including Schmolz+Bickenbach distribution sales as from January 1, 2015) amounted to €1,330 million, generating adjusted EBITDA of €36.9 million.

Financial position at September 30, 2015

The Group consolidated balance sheet shows total assets of over €1 billion. Operating working capital amounted to €394 million, or 22% of sales.

Group net debt stood at €216.8 million compared to shareholders' equity of €302 million, resulting in a net debt to equity ratio of 72%.

On October 30, 2015 the Group, advised by Bayern LB, carried out a Schuldschein issue (private placement of debt securities under German law), which enabled it to raise €88 million (5-year bullet loan), mainly used to refinance the €48.6 million paid out for the acquisition of Schmolz+Bickenbach distribution.

Earnings per division

As of the third quarter 2015, the Jacquet Metal Service group has reorganized its financial communication on the basis of three divisions:

  • Jacquet-Abraservice: the two brands, specialized in the distribution of quarto plates respectively in stainless steel and wear-resistant steel, now form a single division under the same operating management, given that they offer opportunities for synergies in terms of procurement. This combination will not affect the sales networks, which will remain separate.
  • Stappert: division specialized in the distribution of long stainless steel products.
  • IMS group: division specialized in the distribution of engineering steels, mainly in the form of long products. This division now includes the Schmolz+Bickenbach distribution businesses.
 

Stainless steel and wear-

resistant quarto plates

  Long stainless steel

products

  Engineering

steels

 
     

JACQUET-

ABRASERVICE

STAPPERT

IMS GROUP

 
€ millions Q3 2015 (2) 2015

9-month (2)

Q3 2015 (2) 2015

9-month (2)

Q3 2015 (2) 2015

9-month (2)

Sales 79.8 261.6 109.1 345.9 189.8 395.0
Change vs. 2014 +7.2% +19.3% -6.6% -1.3% +118.4% +37.4%
Price effect -11.4% -0.4% -6.9% +0.7% -3.5% -3.3%
Volume effect +9.9% +10.5% +0.2% -2.1% +2.1% +4.5%
Changes in consolidation +8.7% +9.2% 0.0% 0.0% +119.8% +36.2%
Adjusted EBITDA (1)(3) 1.4 7.6 3.1 13.5 1.2 10.7
% of sales 1.8% 2.9% 2.9% 3.9% 0.6% 2.7%
Operating income before non-recurring items (0.5) 1.8 2,5 12,1 (1.3) 6,0
% of sales -0.7% 0,7% 2,2% 3,5% -0,7% 1,5%

(1) Non-brand operations (including Jacquet Metal Service SA) contributed €3.7 million to Q3 2015 adjusted EBITDA and €5.6 million to 2015 9-month adjusted EBITDA.
(2) Including the distribution business purchased from Schmolz+Bickenbach from July 22, 2015
(3) Adjusted for non-recurring items (non-IFRS financial indicators)

  • Jacquet-Abraservice

    Q3 2015 sales totaled €79.8 million, up 7.2% versus Q3 2014 (+18.6% volume effect, including a 9.9% volume increase at constant consolidation and consolidation changes of +8.7%; -11,4% price effect), while adjusted EBITDA came to €1.4 million. Third quarter earnings were impacted by falling prices and challenging market conditions in the United States.

    The division posted sales of €261.6 million for the nine months ended September 30, 2015, up 19.3% versus 2014 (+19.7% volume effect including consolidation changes of +10.5%; -0.4% price effect). Accordingly, Jacquet-Abraservice reported adjusted EBITDA of €7.6 million.
  • Stappert

    For the third quarter of 2015, the division posted sales of €109.1 million, down 6.6% from the same period in 2014 (+0.2% volume effect; -6.9% price effect), and adjusted EBITDA of €3.1 million. Quarterly earnings were impacted by falling prices.

    The division posted sales of €345.9 million for the nine months ended September 30, 2015, down 1.3% versus 2014 (-2.1% volume effect; +0.7% price effect). Adjusted EBITDA came to €13.5 million.
  • IMS group

    For the third quarter of 2015, sales amounted to €189.8 million, up 118.4% versus Q3 2014 (+121.9% volume effect, including a +2.1% volume increase at constant consolidation and consolidation changes of +119.8% resulting from the consolidation of Schmolz+Bickenbach distribution; -3.5% price effect). Accordingly, adjusted EBITDA came to €1.2 million, including a €1.4 million loss generated by Schmolz+Bickenbach distribution.

    The division posted sales of €395 million for the nine months ended September 30, 2015, up 37.4% versus 2014 (+40.7% volume effect including consolidation changes of +36.2%; -3.3% price effect). IMS group posted adjusted EBITDA of €10.7 million.

September 30, 2015 interim report available: www.jacquetmetalservice.com.

2015 Annual report: Thursday, March 10, 2016 after close of trading

Contacts

Jacquet Metal Service
Thierry Philippe
comfi@jacquetmetals.com
or
NewCap - Relations Investisseurs
Emmanuel Huynh/Julien Perez, +33 1 44 71 94 94
jacquetmetalservice@newcap.fr

Contacts

Jacquet Metal Service
Thierry Philippe
comfi@jacquetmetals.com
or
NewCap - Relations Investisseurs
Emmanuel Huynh/Julien Perez, +33 1 44 71 94 94
jacquetmetalservice@newcap.fr