DIRECT ENERGIE Press release |
Paris, 27 September 2017
Half-year 2017 RESULTS
Solid performance once again
Acceleration of the commercial momentum
437,000 customer sites acquired
Revenue: €1,006.1 million (+16.5%)
Current operating income: €52.6 million (+20.1%)
Acquisition of Quadran in progress and on schedule
Today Direct Energie's Board of Directors approved the Group's consolidated financial statements for the first half of 2017. They were subject to a limited review by the auditors.
The first half of financial year 2017 sees a double-digit increase in revenue and current operating income supported by a strong commercial momentum and a solid performance of the production assets which validates the effectiveness of the vertical integration strategy. These elements enable to confirm the targets stated in the annual results.
Furthermore, in June, the Group announced a structuring acquisition project, Quadran, whose completion is progressing according to schedule.
Continued sales dynamic
| € m | H1 2017 | H1 2016 | Chg. |
| Revenue | 1,006.1 | 863.6 | +16.5% |
| Gross margin | 148.4 | 107.1 | +38.6% |
| EBITDA* | 69.7 | 59.3 | +17.5% |
| Current operating income | 52.6 | 43.8 | +20.1% |
* EBITDA = Current operating income restated for depreciation and amortisation and share-based payments (see Note 25.3 to the half-yearly consolidated financial statements).
The contribution by operating segments is detailed in Section 3 of the Interim Financial Report
In the first half of 2017, the Direct Energie Group reported revenue of €1,006.1 million, up by 16.5% compared to the first half of 2016. This increase is the result of a continuous commercial growth across all segments with a gross acquisition of 437,000 customer sites in France over the period compared to 376,000 in the first half of 2016.
At end-June 2017, the Group's customer portfolio in France reached 2.3 million sites, up 27% compared to the first half of 2016, and breaks down as follows:
| in thousands | 30 June 2017 | 30 June 2016 | Change |
| Residential | 1,926 | 1,481 | 30.0% |
| Non-residential | 385 | 344 | 11.9% |
| Total | 2,311 | 1,825 | 26.6% |
| in thousands | 30 June 2017 | 30 June 2016 | Change |
| Electricity | 1,789 | 1,433 | 24.8% |
| Gas | 522 | 392 | 33.2% |
| Total | 2,311 | 1,825 | 26.6% |
The ruling of the French State Council, considering illegal the regulated gas tariffs, brings closer the prospects of their termination which could also apply to those in electricity. The Group is in a position to take advantage of this decision and create a major growth driver.
Customer acquisitions in the first half of the year generated an increase in volumes delivered in France, both for electricity (8.1 TWh, or +14%) and for gas (3.8 TWh, or +30%).
The gross margin came to €148.4 million, up by 38.6% compared to the first half of 2016 benefiting from the increased energy volumes sold and the ramp-up in power generation. This includes the first time contribution of Marcinelle plant for €8.1 million.
Thanks to controlled personnel expenses, EBITDA amounts to €69.7 million (+17.5%) and current operating income to €52.6 million (+20.1%).
After taking into account the changes in fair value of the derivative financial instruments, mainly due to the physical delivery of underlying energy volumes, operating income came to €31.8 million, up 18%.
While the Group had a recognized a deferred tax income of €34.5 million over the first half 2016, a €(5.5) million deferred tax charge was booked over the period. This charge is mainly due to the utilization of tax losses carried forward recognized in previous periods. This change between the first half 2016 and the first half 2017, with no cash impact, alone explains the decrease in the net result to €17.0 million (52.4 M€ over the first half 2016).
A solid balance sheet
Shareholders' equity came to €203.1 million, compared to €217.5 million at 31 December 2016, mainly due to the change in fair value of the derivative hedging instruments (-€17.8 million), the annual dividend payment, and the implementation of the share buyback program.
| € m | 30/06/2017 | 31/12/2016 | ||
| Gross financial debt | 193.3 | 196.2 | ||
| Margin calls received in cash | 64.2 | 132.4 | ||
| Margin calls paid in cash | (5.5) | (3.2) | ||
| Gross cash and cash equivalents | (194.9) | (368.9) | ||
| Net financial debt | 57.1 | (43.6) |
The net financial debt stood at €57.2 million, compared to €(43.6) million at end-December 2016, mainly impacted by the seasonal and usual changes in WCR.
At end-June 2017 the available cash amounted to €192.3 million, and the Group had €245 million in undrawn financing lines.
Quadran, a structural acquisition that is being finalised
In June 2017, Direct Energie announced that it entered in exclusive negotiations with the intent to acquire the French and French overseas activities of Quadran, one of France's main renewable energy producers. This acquisition is part of Direct Energie's vertical integration strategy, which aims at confirming its position as a global integrated energy player with a diversified generation mix and a strategic position in energy supply.
The acquisition process is progressing as planned. The SPA, signed at the end of July, sets an acquisition price of €303 million, with an earn out of €113 million, which will be partly recognised at closing given the commissioning pace of new projects. The closing is scheduled during the fourth quarter of 2017. Thus, the contribution of Quadran to Direct Energie's 2017 results will be minor, and should generate an EBITDA of more than €60 million in 2018 (*).
(*) The estimated figures and targets regarding the Quadran Group are based on the information provided to Direct Energie by the Quadran Group, as adjusted on the basis of certain assumptions and estimates considered reliable by Direct Energie.
Financing for this acquisition is entirely finalised. In addition to a capital increase of €130 million that was carried out in July through a private placement, the Group secured a 5-year loan of €230 million in August. As part of this transaction, the Group also extended the maturity of a credit line and renewed other existing financing facilities. With contained indebtedness and appropriate financial flexibility, Direct Energie has the necessary resources to finance its growth and development.
2017 objectives confirmed
Based on the 2017 first half performance, and despite recent changes in tariffs that were lower than expected, Direct Energie confirms its annual targets for financial year 2017, namely:
- A customer base of 2.5 million sites;
- Revenue of €2,000 million based on average seasonal temperatures;
- Current operating income of €100 million based on average seasonal temperatures.
"The 2017 first half results allow us to confirm our annual targets. We will continue to build the energy operator of the 21st Century, customer orientated, and relying on a balanced presence both upstream and downstream. The acquisition (in progress) of Quadran, a major player in renewable energy, will fully contribute to this objective. All of Direct Energie's employees are working to meet the new challenges for growth, including the announced termination of the regulated tariffs for gas and electricity", explained Xavier Caitucoli, CEO of Direct Energie.
Next publication:
Revenue for 2017 third quarter on 7 November 2017 after the market close
ISIN code: FR0004191674 / Ticker symbol: DIREN / Euronext Paris, Compartment A
Publications: The Interim Financial Report, the half-year consolidated financial statements, along with the analyst meeting presentation, are available on the Group's website (www.direct-energie.com).
About Direct Energie
Third-largest French electricity and gas provider, the Direct Energie Group supplies, in France and Belgium (under the Poweo brand) more than 2.3 million residential and non-residential customer sites. As an integrated energy actor, Direct Energie produces power, supplies gas and electricity, and sells energy services to its customers. Direct Energie's success has been underpinned for more than 14 years by its technical expertise, excellent customer relationships and innovation capacity. In 2016, the Group generated consolidated revenues of €1,692.4 million and delivered 19.8 TWh of energy.
For more information, visit our website www.direct-energie.com
Press contact:
Image Sept
Grégoire Lucas - glucas@image7.fr - Tel + 33 (0)1 53 70 74 94
Marie Artzner - martzner@image7.fr - Tel + 33 (0)1 53 70 74 31 or + 33 (0)6 75 74 31 73
CM CIC Market Solutions
Stéphanie Stahr - stephanie.stahr@cmcic.fr - Tel + 33 (0)1 53 48 80 57
Direct Energie
Mathieu Behar - mathieu.behar@direct-energie.com - Tel +33 (0)6 12 48 85 85
INCOME STATEMENT
| In thousands of euros | 30/06/2017 | 30/06/2016 | ||
| Revenue excluding Energy Management | 970,174 | 859,008 | ||
| Energy Management margin | 35,885 | 4,557 | ||
| Revenue from ordinary activities | 1,006,059 | 863,565 | ||
| Cost of sales | (857,648) | (756,490) | ||
| Gross margin | 148,412 | 107,075 | ||
| Personnel expenses | (19,251) | (17,167) | ||
| Other operational income and expenses | (60,861) | (31,506) | ||
| Depreciation and amortisation | (15,681) | (14,575) | ||
| Current operating income | 52,619 | 43,826 | ||
| Changes in fair value of Energy financial derivative instruments operational in nature | (20,800) | (16,781) | ||
| Disposals of non-current assets | 2 | (11) | ||
| Impairment of non-current assets | 0 | (112) | ||
| Income and expenses related to changes in scope of consolidation | - | - | ||
| Operating income | 31,820 | 26,923 | ||
| Cost of net debt | (6,207) | (5,237) | ||
| Other financial income and expenses | (293) | (138) | ||
| Financial income/(loss) | (6,500) | (5,375) | ||
| Corporate income tax | (8,503) | 30,533 | ||
| Share of net income from companies accounted for by the equity method | 135 | 332 | ||
| Net income from continuing operations | 16,953 | 52,414 | ||
| Net income from discontinued operations | - | - | ||
| Net income | 16,953 | 52,414 | ||
| of which Net income, Group share | 16,953 | 52,414 | ||
| Earnings per share (in euros) | 0.41 | 1.28 | ||
| Diluted earnings per share (in euros) | 0.39 | 1.21 |
Financial statements having undergone a limited review by the Statutory Auditors
BALANCE SHEET
| In thousands of euros | 30/06/2017 | 31/12/2016 | ||
| Intangible assets | 59,241 | 50,170 | ||
| Property, plant and equipment | 82,363 | 76,217 | ||
| Investments in associates | 1,648 | 1,434 | ||
| Non-current derivative financial instruments | 11,769 | 19,334 | ||
| Other non-current financial assets | 2,221 | 1,342 | ||
| Other non-current assets | 5,924 | 8,210 | ||
| Deferred tax assets | 57,554 | 66,467 | ||
| Non-current assets | 220,720 | 223,173 | ||
| Inventory | 42,696 | 38,458 | ||
| Trade receivables | 406,956 | 413,279 | ||
| Current derivative financial instruments | 53,972 | 137,084 | ||
| Other current financial assets | 21,390 | 18,364 | ||
| Other current assets | 37,492 | 30,263 | ||
| Cash and cash equivalents | 194,884 | 368,867 | ||
| Current assets | 757,389 | 1,006,314 | ||
| TOTAL ASSETS | 978,109 | 1,229,487 | ||
| Share capital and share premiums | 19,538 | 15,307 | ||
| Retained earnings and profit or loss | 196,706 | 188,769 | ||
| Treasury shares | (9,044) | (207) | ||
| Other comprehensive income | (4,134) | 13,630 | ||
| Shareholders' equity - Group share | 203,066 | 217,499 | ||
| TOTAL SHAREHOLDERS' EQUITY | 203,066 | 217,499 | ||
| Non-current provisions | 34,014 | 37,658 | ||
| Non-current derivative financial instruments | 20,568 | 17,311 | ||
| Other non-current financial liabilities | 183,736 | 182,843 | ||
| Other non-current liabilities | 5,349 | 4,759 | ||
| Deferred tax liabilities | 367 | 13,065 | ||
| Non-current liabilities | 244,033 | 255,637 | ||
| Current provisions | 14,944 | 14,169 | ||
| Trade payables | 158,751 | 242,602 | ||
| Current derivative financial instruments | 63,564 | 103,925 | ||
| Other current financial liabilities | 73,746 | 145,689 | ||
| Other current liabilities | 220,004 | 249,966 | ||
| Current liabilities | 531,010 | 756,351 | ||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 978,109 | 1,229,487 |
Financial statements having undergone a limited review by the Statutory Auditors
STATEMENT OF CHANGES IN EQUITY
| Share capital | Share premiums | Retained earnings and net income/(loss) | Treasury shares | Other comprehensive income | Shareholders' equity - Group share | |||||
| In thousands of euros | Changes in fair value | Other | ||||||||
| Shareholders' equity at 30/06/2016 | 4,122 | 8,071 | 116,751 | (52) | (87,512) | 0 | 41,380 | |||
| Shareholders' equity at 31/12/2016 | 4,150 | 11,157 | 188,769 | (207) | 13,630 | 0 | 217,499 | |||
| Net income | - | - | 16,953 | - | - | - | 16,953 | |||
| Other comprehensive income | - | - | - | - | (17,764) | - | (17,764) | |||
| Comprehensive income | - | - | 16,953 | - | (17,764) | - | (811) | |||
| Capital increase | - | - | - | - | - | - | - | |||
| Options exercised | 42 | 4,189 | - | - | - | - | 4,232 | |||
| Options | - | - | 1,359 | - | - | - | 1,359 | |||
| Treasury share purchases/sales | - | - | 33 | (8,837) | - | - | (8,805) | |||
| Dividends paid | - | - | (10,407) | - | - | - | (10,407) | |||
| Shareholders' equity at 30/06/2017 | 4,192 | 15,346 | 196,706 | (9,044) | (4,134) | 0 | 203,066 | |||
Financial statements having undergone a limited review by the Statutory Auditors
STATEMENT OF CASH FLOWS
| In thousands of euros | 30/06/2017 | 30/06/2016 | ||
| Consolidated net income | 16,953 | 52,414 | ||
| Tax expenses/income | 8,503 | (30,533) | ||
| Financial income/(loss) | 6,500 | 5,375 | ||
| Income before taxes and financial expenses | 31,955 | 27,255 | ||
| Depreciation and amortisation | 15,681 | 14,575 | ||
| Impairment | - | 112 | ||
| Provisions and depreciations | 4,731 | 31,446 | ||
| Effect of changes in consolidation scope and other gains and losses on disposals | (0) | 0 | ||
| Expenses related to share-based payments | 1,359 | 862 | ||
| Change in fair value of financial instruments | 26,482 | 16,781 | ||
| Other financial items with no cash impact | (294) | 11 | ||
| Share of income from affiliates | (135) | (332) | ||
| Items with no cash impact | 47,823 | 63,456 | ||
| Income tax paid | (4,213) | - | ||
| Change in working capital requirement | (122,509) | (4,248) | ||
| Net cash flow from operating activities | (46,944) | 86,463 | ||
| Acquisition of fixed assets | (30,519) | (16,502) | ||
| Disposals of fixed assets | 2 | - | ||
| Change in deposits and guarantees | (68,734) | 35,644 | ||
| Net change in loans granted by the company | (10,177) | 3,356 | ||
| Net cash flows from investing activities | (109,430) | 22,497 | ||
| Sums received from shareholders during capital increases | 4,232 | 3,190 | ||
| Treasury shares | (8,805) | 36 | ||
| Proceeds from borrowings | 2,159 | 117,494 | ||
| Repayment of borrowings | (1,104) | (60,870) | ||
| Interest paid | (2,391) | (2,975) | ||
| Interest received | 150 | 657 | ||
| Dividends paid | (10,407) | (8,242) | ||
| Net cash flows used in financing activities | (16,166) | 49,291 | ||
| Net change in cash and cash equivalents | (172,540) | 158,250 | ||
| Cash and cash equivalents at beginning of year | 364,837 | 31,993 | ||
| Cash and cash equivalents at end of year | 192,298 | 190,243 |
Financial statements having undergone a limited review by the Statutory Auditors
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Direct Energie via Globenewswire
