LISI (EPA:FII) - Q3 2019 Financial information
Transparency directive : regulatory news
23/10/2019 17:41
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FINANCIAL INFORMATIONQuaterly Consolidated Sales
In million euros
2019 445 441 412
2018 420 416 386 424
Q1 Q2 Q3 Q4
EBIT* & Net Profit in EURM
EBIT 157,5 171,4 135,6
Net Profit 107,0 108,0 92,1
2016 2017 2018
(1) The change on a like-for-like and constant exchange rate basis is
calculated by:
. Converting sales of companies whose accounts are denominated in foreign
currencies to the average rate of year N-1 or month M-1
. Converting sales invoiced in currencies other than the local currency to the
average rate of year N-1 or month M-1
. restated to reflect consolidation scope entries and exits to allow for
period-to-period comparison.
* After participation and profit-sharing expenses
The LISI Group posted sales of EUR 1.3 billion in the first nine months of
2019, up +6.3% versus the comparable 2018 period, with +5.7% organic growth in
Q3
> LISI AEROSPACE: +8.5% cumulative and +9.3% organic growth in Q3
o Accelerated demand for "Fasteners" in Europe and good momentum in North
America,
o "Structural Components" segment continuing to benefit from ramp-up of new
engine programs,
o Initial effects of lower Boeing B737-Max rates, offset by the dynamism of the
other segments in Q3,
o Favorable currency effect, especially the US dollar,
o Deconsolidation since July 1st of the two subsidiaries INDRAERO SIREN and
LISI AEROSPACE Creuzet Morocco whose main activities are sheet metal primary
parts and assembly of aerostructures.
> LISI AUTOMOTIVE: -4.0% cumulative and +0.6% organic growth in Q3
o Persisting weakness of European and global markets, in line with H1-2019,
o Return to organic growth with a more favorable base effect at the end of the
quarter,
o Continued market share gains in high value-added activities,
o Negotiations with AFF GROUPE for the sale of chassis screws and steering
pivots.
> LISI MEDICAL: +7.7% cumulative and +3.3% organic growth in Q3
o Accelerated growth in the minimally invasive surgery sector,
o Strong instability of business at the two small sites of the division.
In EURm Changes
On a like-for-like
and constant
exchange rate
2019 2018 2019 / 2018 basis(1)
Q1 445.0 419.5 + 6.1 % + 1.0 %
Q2 441.3 415.6 + 6.2 % + 1.6 %
Q3 411.9 386.3 + 6.6 % + 5.7 %
3rd quarter ended
September 30, 1,298.1 1,221.4 + 6.3 % + 3.9 %
At EUR 1.3 billion, consolidated sales for the first nine months of 2019 are up
by +6.3% and take into account the following elements:
> a favorable currency effect of +EUR 32.6 million (or +2.5% of sales),
> a scope effect of + EUR12.5m corresponding to:
* +EUR 28.9 million from the integration into LISI AUTOMOTIVE of the US
company Hi-Vol as of October 1, 2018,
* -EUR 3.4 million reflecting the disposal of the German company Beteo (LISI
AUTOMOTIVE) on December 31, 2018,
* -EUR 13.0 million from the deconsolidation of Indraero Siren and LISI
AEROSPACE Creuzet Morocco completed on June 30, 2019.
Sales in million euros
End of September
687,1 437,1 97,8 741,8 448,3 108,8
2018 2019 2018 2019 2018 2019
AEROSPACE AUTOMOTIVE MEDICAL
At constant scope and exchange rates, consolidated sales increased by +3.9%
over the first nine months of the year. The Group confirms the return to
positive organic growth since the beginning of the year (Q1 2019: +1.0%; Q2:
+1.6%; Q3: + 5.7%), driven by the LISI AEROSPACE and LISI MEDICAL divisions.
LISI AUTOMOTIVE began to benefit in Q3 from the development of new products and
a less adverse comparison base effect versus 2018.
COMMENTS BY DIVISION
LISI AEROSPACE (57 % of consolidated sales)
In EURm Changes
On a like-for-like
and constant
exchange rate
2019 2018 2019 / 2018 basis(1)
Q1 252.6 235.6 + 7.2 % + 3.0 %
Q2 254.4 230.1 + 10.6 % + 6.7 %
Q3 234.8 221.4 + 6.1 % + 9.3 %
3rd quarter ended
September 30, 741.8 687.1 + 8.0 % + 8.5 %
Markets remained buoyant in Q3 with aircraft manufacturers remaining confident
in their long-term growth prospects. In the short term, the uncertainties
related to the return of the Boeing B737-Max are still a major area of concern.
The consequences of the fall in production rates since March 2019 began to be
felt in Q3.
At EUR 234.8 million, the LISI AEROSPACE division's third quarter sales are up
+6.1% compared to the same period last year despite the deconsolidation of
INDRAERO SIREN and LISI AEROSPACE Creuzet Morocco since July 1, 2019, which
represents a decrease in sales of - EUR 13.0 million.
The "Europe Fasteners" segment benefits from the increase in single-aisle
production rates after several quarters of disruptions caused by the supply
chain adjustments. In North America, a sustained level of activity in non-
commercial aviation markets (business jets, defense, helicopters) continues to
offset the decline in B737-Max program rates.
Growth with Boeing is continuing, reflecting market share gains in recent years
and the contribution of new products. The "Structural Components" segment
benefits from the continued ramp-up of engine programs. The decrease in LEAP-1B
engine production rates for the Boeing B737-Max was partially offset by higher
LEAP-1A engine production rates.
At constant scope and exchange rates, sales are up +9.3% in the quarter and
+8.5% in the first nine months of the year.
From an operational point of view, the division is in line with objectives,
thanks in particular to the increase in volumes and measures to improve
industrial productivity.
% Sales Variation per division / N-1
LISI AUTOMOTIVE (35 % of consolidated sales)
In EURm Changes
On a like-for-like
and constant
exchange rate
2019 2018 2019 / 2018 basis(1)
Q1 156.0 153.9 + 1.4 % - 5.1 %
Q2 151.2 152.1 - 0.6 % - 6.7 %
Q3 141.2 131.1 + 7.7 % + 0.6 %
3rd quarter ended
September 30, 448.3 437.1 + 2.6 % - 4.0 %
Developments in the global automotive market remain broadly in line with the
trends observed since Q4 2018 and show no signs of recovery in the short term.
The level of global sales thus stands at -2.7% for the quarter, down -5.6% over
the first nine months of the year. The Chinese market continues to decline
(-6.3% in Q3, or -10.3% over nine months). Europe is doing better (Q3 2019:
+2.2%, - 1.6% over nine months) with a base effect that became favorable from
September (entry into force of the WLTP standards on September 1, 2018).
At EUR 141.2 million, third quarter sales of the LISI AUTOMOTIVE division is up
+7.7% compared to the same period of the previous fiscal year thanks in
particular to the integration of the American company Hi-Vol since October 2018
(+EUR 9.6 million in Q3). The disposal of the German company Beteo on December
31, 2018 represents a decrease in sales of - EUR 1.2 million. At constant scope
and exchange rates, sales are back in positive territory in the quarter and are
up +0.6%.
Over the first nine months of the year, sales were down -4.0%, compared to a
fall in global production of -8.0% over the period. The scope effect of
Hi-Vol's consolidation and the divestment of Beteo was +EUR 25.5 million. The
division thus confirms gains in market share, particularly in high value-added
markets such as "Safety Mechanical Components" and "Clipped Solutions".
In terms of operations, the LISI AUTOMOTIVE division continues to adapt its
cost structure to lower activity levels in still difficult market conditions.
LISI MEDICAL (8 % of consolidated sales)
In EURm Changes
On a like-for-like
and constant
exchange rate
2019 2018 2019 / 2018 basis(1)
Q1 36.6 30.2 + 21.2 % + 16.6 %
Q2 36.0 33.6 + 7.1 % + 4.2 %
Q3 36.2 34.0 + 6.7 % + 3.3 %
3rd quarter ended
September 30, 108.8 97.8 + 11.3 % + 7.7 %
Market developments in the short term remain in line with the trends observed
over the last five years (+ 4.0%). The concentration movement continues both
for contractors and their suppliers.
At EUR 36.2 million, sales for the quarter were up +6.7% compared to the same
period last year. The division benefited from the ramp-up of new products in
the area of minimally invasive surgery (LISI MEDICAL Remmele) and a favorable
currency effect.
At constant scope and exchange rates cumulative sales are up +3.3% with an
unfavorable base effect compared to Q3 2018 (+9.3%). The volatility of the LISI
MEDICAL division's sales is particularly affecting the two small sites of
Escondido (United States) and Neyron (France). On the other hand, the situation
is very clearly stabilizing at LISI MEDICAL Remmele (United States), which is
seeing acceleration in growth in minimally invasive surgery.
From an operational point of view, the division has difficulty generating the
targeted level of margin.
OUTLOOK AND COMMENTS ON THE FINANCIAL IMPACT OF BUSINESS
LISI AEROSPACE
Long-term growth prospects for the global aerospace market remain strong.
Short-term uncertainty remains regarding the date and conditions for returning
the Boeing 737-Max to service. The impact on LISI AEROSPACE division's sales is
estimated at between EUR 15 and EUR 20 million in 2019, assuming stable
production rates are maintained. The strong momentum of LISI AEROSPACE's
various activities should nonetheless offset this impact, as well as the impact
of the disposals of Indraero-Siren and LISI AEROSPACE Creuzet Morocco.
LISI AUTOMOTIVE
The Automotive division will benefit from a favorable base comparison effect in
Q4, but the market environment will remain difficult. Efforts will remain
focused on cost reduction plans and execution of the strategy aiming at
changing the product portfolio mix. The successful implementation of the
ramp-up of new products in the "Safety Mechanical Components" and "Clipped
Solutions" segments is expected to accelerate this transformation, as well as
the divestment of chassis fasteners and steering pivots segments upon
completion on the negotiations initiated with AFF Groupe in Q3.
LISI MEDICAL
The main challenges facing the division include controlling the ramp-up of new
products at LISI MEDICAL Remmele and adapting the cost structure in the
division's two small sites. Positive relations with LISI MEDICAL's major
customers reinforce the current strategic choices.
LISI CONSOLIDE
The Group's annual consolidated outlook should be a natural extension of the
first half. Aerospace performance is expected to largely offset the specific
situation of the automotive market in 2019 as well as the production imbalance
between the LISI MEDICAL division's sites.
The Group thus confirms its annual objectives of posting largely positive
organic growth, exceeding its financial performance of 2018 and generating
excellent Free Cash Flow(1).
CONTACT
Emmanuel VIELLARD
CEO
Mail: emmanuel.viellard@lisi-group.com
Tel : +33 3 84 57 00 77 - Website: www.lisi-group.com
(1) Free Cash Flow: cash flow from operations minus net capital expenditures
and changes in working capital requirements
TRADING AGREEMENT: ODDO BHF CORPORATE - +33 (0)1 44 51 86 80
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