PRESS RELEASE

B&C Speakers S.p.A.

The Board of Directors approves the Interim Report on Operations at 30 September 2017
  • Consolidated revenues of Euro 29.65 million (+3.9% compared with Euro 28.53 million for the corresponding period in 2016)
  • Consolidated EBITDA of Euro 7.20 million (+0.5% compared with Euro 7.16 million for the corresponding period in 2016)
  • Group net profit equal to Euro 4.62 million (+14.75% compared with Euro 4.21 million for the corresponding period of 2016)
  • Group net financial position of Euro 1 million (a positive Euro 7 million at year-end 2016)
  • The Parent Company's order book was Euro 8.2 million at the end of third quarter period (at 30 September 2016 it was Euro 8.1 million).

BagnoaRipoli(Fi),14November2017- The Board of Directors of B&C Speakers S.p.A., one of the foremost international players in the design, manufacture, distribution and marketing of professional electro-acoustic transducers (loudspeakers), approved the Interim Report on Operations of the group for the first nine months of 2017, prepared in accordance with IFRS international accounting standards.

Revenues

Consolidated revenues in the first nine months of 2017 amounted to € 29.65 million, resulting in growth of 3.9% compared to the same period of 2016 when turnover stood at € 28.53 million.

The above growth was achieved thanks to good performance in the period just before summer when manufacturing and turnover levels were excellent.

In the table below, we show the breakdown by geographical area of the turnover achieved by the Group during the period under review compared with the same period of the previous year:

Revenues per geographic area

(values in Euro/thausand)

3 Q 2017 YTD %

3 Q 2016 YTD %

Difference

Difference %

Latin America

2,107,025

7.1%

1,591,061

5.6%

515,964

32.4%

Europe

13,790,217

46.5%

13,381,690

46.9%

408,527

3.1%

Italy

1,875,616

6.3%

2,430,126

8.5%

(554,510)

-22.8%

North America

5,440,394

18.3%

5,463,109

19.1%

(22,715)

-0.4%

Middle East & Africa

327,978

1.1%

189,680

0.7%

138,298

72.9%

Asia & Pacific

6,112,397

20.6%

5,478,134

19.2%

634,263

11.6%

Total

29,653,628

100.0%

28,533,800

100.0%

1,119,828

3.9%

During this period, the Group has significantly increased its presence in the Asian market (+11.6% with sales of € 6.1 million) and has achieved excellent performance in the South American market (+32.4% with sales of € 2.1 million), and in the European market (+3.1% with sales of € 13.7 million) which remains the most important market for the Group. Results were down in the Italian market compared to the first nine months of 2016 (-22.8% with sales of € 1.3 million). The North American market was substantially stable.

Revenues per geographic area Geographic Area

Europe Asia & Pacific North America

Italy Latin America Middle East & Africa

328

190

1,876

2,430

2,107

1,591

6,112

5,478

5,440

5,463

13,790

13,382

3 Q 2017 YTD 3 Q 2016 YTD

- 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000

Thousand of Euro Cost of sales

This category includes raw materials (purchasing, processing by third parties and changes in inventories), the cost of personnel directly involved in the production process, transport costs and the costs for commissions payable, customs duties and other direct costs of lesser importance.

Cost of sales during the first nine months of 2017 remained almost stable in terms of the proportion of revenues compared to the first nine months of 2016, rising from 57.97% to 58.20%.

Indirect personnel

Over the first nine months of 2017 cost of indirect labour increased slightly more than turnover, increasing their proportion of revenues (5.54% in the first nine months of 2017 against 5.42% in the same period last year).

Commercial expenses

This category refers to costs for commercial consultancy, advertising and marketing, travel and subsistence and other minor charges relating to the commercial sector.

Commercial expenses showed a slight increase compared to the first nine months of the previous year. Therefore, as a proportion of revenues they slightly increased from 2.09% in the first nine months of 2016 to 2.24% in the first nine months of 2017.

Administrative and General

General and administrative expenses increased by around € 230,000 compared to the first six months of the previous period, with a slightly increased impact on revenues which went from 9.77% in the first nine months of 2016 to 10.22% in the first nine months of 2017. The increase is principally due to the use of technical consulting aimed at improving manufacturing and operational procedures as well as investment associated with the new company division.

EBITDA and EBITDA margin

As a result of the trends illustrated above, EBITDA of the first nine months of 2017 amounted to 7.20 million euro, with an increase of 0.53% compared with the same period of 2016 (in which EBITDA amounted to 7.16 million euro).

The EBITDA margin for the first nine months of 2017 was therefore equal to 24.27% of revenues, whilst it was 25.09% during the same period in 2016.

EBIT and EBIT margin

EBIT as of 30 September 2017 amounted to 6.6 million euro, an increase of 1.31% compared with the same period of 2016 (when the figure was 6.51 million euro). The EBIT margin was 22.26% of revenues (22.84% in the same period of 2016).

Group Net Result and Net Financial Position

The Group's net profit at the end of the first three quarters of 2017 amounted to Euro

  1. million and represents 16% of consolidated revenues (also up, by 14.8%, compared with the Euro 4.21 million of the corresponding period of 2016).

    There is a reduction in the tax rate due to the reduction of the IRES rate; this improvement will be further confirmed by the results of the not yet concluded "ruling" with Italian tax authorities for Patent Box fiscal break. The conclusion of the process should take place by the end of 2017 and will also cover profits from 2016 and 2015.

    The Group's financial stability remains adequate even if the Net Financial Position is lower in respect of 2016 year end, as of September 30thit is negative and amounts to Euro 1 million (at the end of 2016 it was positive by Euro 7.07 millions). The decrease is mainly due to the dividend, amounted at 10.9 million Euro, paid in May and to the taxes paid for 1.39 million Euro.

    The Group's reclassified Income Statement for the first nine months of 2017 is shown in the table below

    Economic trends - Group B&C Speakers

    (€ thousands)

    9 months

    2017

    9 months

    Incidence

    2016

    Incidence

    Revenues

    29,654

    100.00% 28,534

    100.0%

    Cost of sales

    (17,260)

    -58.20% (16,542)

    -58.0%

    Gross margin

    12,394

    41.80% 11,992

    42.0%

    Other revenues

    143

    0.48% 98

    0.3%

    Cost of indirect labour

    (1,644)

    -5.54% (1,546)

    -5.4%

    Commercial expenses

    (664)

    -2.24% (598)

    -2.1%

    General and administrative expenses

    (3,032)

    -10.22% (2,786)

    -9.8%

    Ebitda

    7,198

    24.27% 7,160

    25.1%

    Depreciation of tangible assets

    (576)

    -1.94% (568)

    -2.0%

    Amortization of intangible assets

    (21)

    -0.07% (19)

    -0.1%

    Writedowns

    0

    0.00% (57)

    -0.2%

    Earning before interest and taxes (Ebit)

    6,601

    22.26% 6,516

    22.8%

    Financial costs

    (351)

    -1.18% (204)

    -0.7%

    Financial income

    464

    1.56% 333

    1.2%

    Earning before taxes (Ebt)

    6,714

    22.64% 6,645

    23.3%

    Income taxes

    (1,991)

    -6.71% (2,289)

    -8.0%

    Profit for the year

    4,723

    15.93% 4,356

    15.3%

    Minority interest

    0

    0.00% 0

    0.0%

    Group Net Result

    4,723

    15.93% 4,356

    15.3%

    Other comprehensive result

    (100)

    -0.34% (147)

    -0.5%

    Total Comprehensive result

    4,623

    15.59% 4,209

    14.8%

    Significant events during the first nine months of 2017

    During the first nine months of 2017, the following significant events occurred:

    • The collection of new orders was again satisfactory. The order book on the date when the present report was prepared amounted to Euro 8.1 million andthetotalcollectionduringthefirstninemonthsoftheyearwasgreaterthanthesameperiodof2016by3%.

    • The Shareholders' Meeting held on the 26 April 2017 defined the issue of an ordinary dividend of Euro 0.40 per ordinary share in circulation at the ex- coupon date. In addition to the ordinary dividend, and in order to reward shareholders of the Company during the tenth year since listing, the Shareholders' Meeting defined the distribution of an extraordinary dividend of Euro 0.6 for each ordinary share in circulation at the coupon detachment date. The total value of the dividend issued was therefore Euro 10.9 million.

      Significant events occurring after 30 September 2017

      After the end of the third quarter of 2017 and up to the date of preparation of the Consolidated Interim Report, our attention was drawn to the following significant events:

    • On 02 October 2017, the Parent Company signed a binding agreement to buy

B&C Speakers S.p.A. published this content on 14 November 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 14 November 2017 16:04:02 UTC.

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