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Agfa-Gevaert publishes its second quarter 2016 results

Thursday, August 25, 2016

Press release from the issuing company

Mortsel, Belgium - Agfa-Gevaert today announced its second quarter 2016 results.  

"In the second quarter, our efficiency measures continued to contribute to the improvement of our profitability. Also helped by positive raw material effects, we brought our gross profit margin to the highest level in more than five years. Our recurring EBITDA margin improved to 12.1% of revenue in the second quarter and to 10.1% after six months. This clearly shows that we took a step towards reaching the 10% target we set for the full year. The very solid net profit is another point of satisfaction. We now expect the top line decline rate to slow down in the second half of the year," said Christian Reinaudo, President and CEO of the Agfa-Gevaert Group.

Agfa-Gevaert Group - second quarter 2016

in million Euro

Q2 2015

Q2 2016

% change

Revenue

691

645

-6.7%

Gross profit (*)

229

230

0.4%

% of revenue

33.1%

35.7%

 

Recurring EBITDA (*)

72

78

8.3%

% of revenue

10.4%

12.1%

 

Recurring EBIT (*)

56

64

14.3%

% of revenue

8.1%

9.9%

 

Result from operating activities

48

74

54.2%

Result for the period 

25

40

60.0%

Net cash from (used in) operating activities

(1)

8

 

(*) before restructuring and non-recurring items 

Notwithstanding the good performance of the growth engines, the Agfa-Gevaert Group's revenue decreased by 6.7% (4.1% excluding currency rates) to 645 million Euro. The classic film products continued to decline in all business groups. The lower top line of the Agfa HealthCare business group is largely contributable to the hardcopy business, where sales were exceptionally high in the second quarter of 2015. 

Due to targeted efficiency measures and positive raw material effects (mainly in the Agfa Graphics business group), the Group was able to improve its gross profit margin by 2.6 percentage points to 35.7% of revenue, thus reaching the highest level since the second quarter of 2010.   

As a percentage of revenue, Selling and General Administration expenses amounted to 20.0%. 

R&D expenses amounted to 35 million Euro, or 5.4% of revenue. 

Recurring EBITDA (the sum of Graphics, HealthCare, Specialty Products and the unallocated portion) improved strongly from 10.4% of revenue in the second quarter of 2015 to 12.1%. Recurring EBIT improved from 8.1% of revenue to 9.9%. 

Restructuring and non-recurring items resulted in an income of 10 million Euro, versus an expense of 8 million Euro in the second quarter of 2015. This was mainly due to the sale of the properties of the Korean manufacturing site, which was closed in 2015. 

Mainly due to the decision to mothball the operations in Venezuela, the net finance costs increased from 14 million Euro in the second quarter of 2015 to 21 million Euro. This decision led to a one-off reclassification from translation reserve to profit and loss for an amount of 7.5 million Euro. This reclassification did not have any cash flow or equity impact.  

Income tax expenses amounted to 13 million Euro, versus 9 million Euro in the previous year. 

As a result of the elements mentioned above, the Agfa-Gevaert Group posted a very strong net profit of 40 million Euro, a 60% increase versus the second quarter of 2015.

 

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