MR BRICOLAGE (EPA:ALMRB) - Mr.Bricolage: 2020 FULL-YEAR EARNINGS / Successful transition

Transparency directive : regulatory news

10/03/2021 18:00

2020 FULL-YEAR EARNINGS
Successful transition

Orléans, 10 March 2021, 6pm CET - Mr.Bricolage SA, which groups together local
independent home improvement and gardening stores, is reporting its
consolidated earnings for 2020, which were approved by the Board of Directors
during its meeting on 10 March 2021. 2020 was marked by strong growth in the
volume of business for the Group's networks (+11.5% on a total store basis and
+11.7% on a like-for-like store basis). In France, these performance levels
(+11.2% on a like- for-like store basis) clearly outperformed the market
(+4.8%(1)), reflected in an increase in turnover for the "Network Services"
business and a strong turnaround in operating margins. These results are based
primarily on the Group's realignment around its core business, driven by the
Rebond plan, and highlight the success of the strategy rolled out by the teams
over the last four years, in a buoyant market context in 2020.

"This year, we finalized our REBOND strategic plan, which was launched in 2016,
and we are coming through this health crisis period thanks to the agility of
our teams and our ongoing collective work. The results that we are presenting
today highlight the relevance of our roadmap and the effectiveness of the
sometimes-difficult decisions that we have taken in the last few years. Thanks
to our networks' growth and the dedication shown by our members to support the
Mr.Bricolage banner, the resizing of the Group has been able to move forward
while maintaining growth in our core business, Network Services. The REBOND
strategy was the right response to the issues identified in order to relaunch
the development of the Group and its networks supported by economic and
financial foundations that have been overhauled. In a buoyant home improvement
market, we have fully benefited from the optimization of our organization and
accelerated our return to profitable growth. During this complex period, I am
particularly proud of the work accomplished, made possible by the outstanding
mobilization of members-entrepreneurs across our network and our head office
staff, who have capitalized on their talents and skills to support the Group's
modernization. Today, we have all the assets needed to continue moving forward
together successfully around a shared strategic project and to further
strengthen our positioning as a leader for proximity on our market", confirms
Christophe Mistou, Mr.Bricolage Group CEO.

(1) "Home improvement superstore" index, December 2020: annual aggregate in
terms of value: +4.78%, in terms of volume: +3.81%.

I - KEY DEVELOPMENTS IN 2020

1. Solid business volume growth and network development

At 31 December 2020, the member and affiliate networks in France and other
countries comprised 854 stores, compared with 778 at end-December 2019.
Together, these stores represent a total volume of business of around
EUR2,195m, up 11.5% on a total store basis and 11.7% on a like-for-like store
basis. Over the year, the Group recorded a net balance of 76 new points of
sale, including nine for the Mr.Bricolage brand. Further strengthened in the
last few years through the REBOND plan, the networks are also benefiting from
the arrival of 64 new affiliates and three Les Briconautes brand stores. This
sustained development of member and affiliate points of sale, despite the
cautious approach linked to the health crisis, confirms the ambition to have
more than 1,000 points of sale by 2028.

In France, the Mr.Bricolage Group networks represented a total of 783 stores at
31 December 2020, up from 708 at 31 December 2019, with a net balance of 75 new
points of sale. Reflecting the combined impact of the REBOND strategy, the
increase in the number of stores that have been modernized ("4 pillars
concept"), and the strong level of consumer interest in renovating and
improving their homes, the volume of business for members and affiliates in
France came to EUR1,896m, outperforming the market by almost 7 points, up 11.2%
on a like-for-like store basis and 11.7% on a total store basis.

REBOND's international component has also delivered a range of benefits. With
71 stores in 10 countries outside of France, the international network is back
up to its scope from 2016, covering areas that are more consistent in terms of
the logistics organization or market potential. This is particularly true on
the African continent, where the brand, which was already present in four
countries, benefited from the opening of its first store with 1,019 sq.m in
Gabon (Port-Gentil) and its eighth store with 625 sq.m in Morocco (Casablanca).
Internationally, the Mr.Bricolage brand generated a business volume of
EUR294.5m, up 12.2% on a total store basis and 14.5% on a like-for-like store
basis.

With a strategy that positions in-store footfall at the heart of the business
model and focuses in particular on click and collect (2h collection), the
online sales recorded are not representative of the commercial activity
generated thanks to the web, which is included in the volume of business for
stores in France, and which also takes into account the closure of the Le
Jardin de Catherine site at the end of 2019. With 95% of the Mr.Bricolage
stores connected to the e-commerce platform, and a 45% increase in the number
of unique visitors, the Group's web-to-store strategy proved its relevance to a
great extent in 2020, particularly during the lockdown periods when the digital
teams mobilized to support members and scale up the e-commerce platform in line
with the increase in traffic. Sales generated on the Mr.Bricolage.fr site
doubled and 2h collection orders quadrupled in 2020 compared with 2019. In-
depth work on the 360 Client Vision was also launched in 2020 and is continuing
to move forward.

Volume of business incl. taxes    Number of      31 Dec
EURM                               stores         2020

In-store sales                       854        2,190.1
- France(2)                          783        1,895.6
- International(3)                    71          294.5
Online sales(4)
(excluding click and collect)          -            4.6
Total                                854        2,194.8

Change on total    Change on like-for-
store basis         like store basis

+11.7%                   +11.7%
+11.7%                   +11.2%
+12.2%                   +14.5%
-45.9%                       NA
+11.5%                   +11.7%

(2) With 306 Mr.Bricolage brand stores, 107 Les Briconautes brand stores and
370 affiliate stores under independent brands.
(3) 71 Mr.Bricolage stores operating in 10 countries: Andorra (1), Belgium
(44), Bulgaria (11), Cyprus (1), Gabon (1), Ivory Coast (1), Macedonia (1),
Madagascar (1), Mauritius (2), Morocco (8).
(4) The "online sales" item includes home delivery sales and sales collected
from Mr. Bricolage stores (excluding click and collect).

2. Finalization of the plan to divest directly-owned stores and realignment
around the "Network Services" business

At 20 July 2020, the Group finalized its realignment around its core Network
Services business. This realignment was one of the core objectives from the
REBOND plan to restore the Group's financial position and focus exclusively on
services for its members and affiliates. 2020 is the first year to reflect the
Group's results with its new configuration.

Out of the Group's 65 directly-owned stores at 31 December 2018, 60 stores were
taken over, with 50 stores placed with Mr.Bricolage members who were already
part of the network and new entrepreneurs looking to join the banner. Only five
stores were closed. The takeover of stores by members- entrepreneurs is moving
forward under good conditions, in terms of both the integration of the teams
and positive changes in their performance indicators.

Alongside this realignment, a major transformation plan launched two years ago
is being rolled out to support head office staff, members and store teams with
the development of their activities and skills. Since the start of the second
half of the year, the work organization for head office staff has been subject
to an in-depth review and now offers more flexibility and independence for
staff to manage and carry out their day-to-day missions.

3. 4 pillars concept development and performance

Thanks to the solid performances rapidly achieved in the stores where it has
been deployed, the 4 pillars store concept (Collaboration, Delivery, Inventiv
Solutions and Home Fund) is attracting more and more members-entrepreneurs
across the Mr.Bricolage network who are choosing to implement it at their
points of sale. To date, despite the health crisis, 25 stores have deployed
this concept, which is fully aligned with the brand's positioning for
proximity: their sections are outperforming the same sections in stores that
have not been modernized. Building on these good results, around 30
modernization projects are planned for 2021.

4. Health crisis linked to the coronavirus

Throughout this year marked by the health crisis, the Mr.Bricolage Group
organized itself to adapt to its networks' needs and respond quickly to support
them with putting in place the measures required. Supported by the Group's very
regular communications on the legislative context and the latest health
guidelines, and by the continuity of the essential procurement, logistics and
support services, the Mr.Bricolage networks' stores benefited from their
proximity to respond to strong demand among consumers looking to improve their
homes.

This level of business reflects the work accomplished since the end of 2016 and
the mobilization shown by entrepreneurs across the networks. It also takes into
account non-recurring elements which benefited the Group's results this year:
use of furlough measures during the first lockdown for the majority of the head
office staff, widespread rollout of arrangements for staff to work from home
from spring (reducing overheads, travel, etc.) and deferral of part of the
marketing operations planned for the banner's 40th anniversary. The hoped-for
return to a more ordinary situation in 2021 should automatically be accompanied
by a normalization of operating expenditure. Especially as a new work
organization, rolled out since September 2020 for the long term, offers each
eligible head office employee flexible arrangements for organizing their
presence at the office as they wish(5).

5. Transfer to Euronext Growth Paris

Following the General Meeting's approval on 22 January 2020, the Board of
Directors' decision on the same day and the Euronext Listing Board's approval
on 24 February 2020, Mr.Bricolage's ordinary shares were admitted to Euronext
Growth Paris on 24 March 2020 under the same ISIN (FR0004034320) and the same
ticker code (ALMRB).

(5) Each eligible head office employee can choose to work from home for 0 to 5
days per week (outside of COVID context): these arrangements were negotiated
with MBSA's employee representative bodies and were set out in the agreement
signed during the second half of 2020.

II - 2020 EARNINGS

The audited results were approved by the Board of Directors on 10 March 2021.
The statutory auditors' reports are currently being issued. The 2020 income
statement and the 2019 earnings reported previously have been restated, in
accordance with IFRS 5, to enable their comparison following the change in
scope linked to the discontinuation of the Retail business.

Condensed consolidated accounts      31 Dec 2020  31 Dec 2019  31 Dec 2019
(EURm)                                               Reported   Restated

Consolidated turnover*                     274.6     247.1       265.3
- Network Services                         274.6     213.9       265.3
- Retail (activity discontinued)               -      33.2           -
EBITDA                                      35.7      27.6        28.7
Current operating profit                    22.0      11.4        16.5
- Network Services                          22.0      16.5        16.5
- Retail (activity discontinued)               -      (5.1)          -
Other non-current operating income
and expenses                                (0.3)    (21.0)       (3.5)
Operating profit                            21.7      (9.6)       13.1
% of turnover                                7.9%     -3.9%        4.9%
Financial income (expense)                  (5.0)     (6.5)       (5.5)
Contribution from associates                 2.8       1.0         1.0
Corporate income tax                        (1.4)     (1.0)       (1.6)
Profit after tax from continuing
operations                                  18.0     (16.1)        7.0
Profit after tax from discontinued
operations                                  (0.3)    (10.3)      (33.4)
Profit (loss) for the period                17.7     (26.3)      (26.3)
- Group share                               17.6     (26.4)      (26.4)
- Minority interests                          NS        NS          NS

Turnover (EURm)             31 Dec 2020    31 Dec 2019  31 Dec 2019
                                             Reported     Restated
Network Services turnover        274.6        213.9        265.3
-   Sales of goods               191.8        145.3        190.4
-   Sales of services             82.8         68.7         74.9
Retail (activity discontinued)       -         33.2            -
Total consolidated turnover      274.6        247.1        265.3

Turnover

Consolidated turnover for 2020, now based exclusively on the Network Services
business, came to EUR274.6m, despite the contraction in sales to directly-owned
stores, achieving +3.5% growth compared with the restated data for 2019. This
increase was possible thanks to growth in the networks in general and
specifically:

- The increase in sales of goods linked to the networks' growth, including the
  previous directly- owned stores taken over by the network, the range changes,
  the development of the own-brand Inventiv, which is proving popular with
  customers, and the opening up of the warehouses to the Briconautes and
  affiliate points of sale;
- The growth in services linked to the increase in the volume of business and
  purchases for the networks' points of sale, particularly the commercial
  performance of the "4 pillars" stores.

Current operating profit / operating profit

For this final year of the REBOND plan, in line with the improvements recorded
since the plan to divest directly-owned stores was rolled out, the current
operating profit totaled EUR22.0m, with a current operating margin of 8.0%,
compared with 4.6% one year earlier (and 6.2% based on restated data). Taking
into account EUR(0.3)m of non-current operations, made up primarily of
non-recurring fees linked to the finalization of the divestment plan, the
operating profit represents EUR21.7m, giving an operating margin of 7.9%,
compared with a EUR(9.6)m loss for 2019. Based on the restated accounts for
2019, the Group's operating profit is up 66.2%.

The significant improvement in management balances, linked to the
discontinuation of the "Retail" business and the efforts made to adapt the
organization in line with its new dimension, was boosted by the effects of the
health crisis for around 2.5 to 3 points (primarily furlough measures in the
second and third quarters, deferral or cancellation of certain marketing costs,
virtualization of internal events). The resources freed up in this way have
consolidated the Group's ability to gradually reduce its debt, while continuing
to deploy resources to support the development of its members and networks.

Net profit

Financial income and expenses came to EUR(5.0)m in 2020, impacted by a change
in the interest rate margin for the syndicated credit agreement set up in the
fourth quarter of 2019, offset by the absence of refinancing costs in 2020.
Following a EUR(1.4)m tax expense, the profit after tax from continuing
operations came to EUR18.0m, with a net margin of 6.6%. After factoring in the
profit after tax from discontinued operations for EUR(0.3)m, the net profit for
the year represents EUR17.7m, compared with EUR(26.3)m in 2019. The Group is
turning around its financial position. As expected, the new business model is
opening up the headroom needed to support the development of the networks and
pay down the debt.

Net debt

At end-2020, the Group used its drawdown capacity under the credit agreement
from 16 October 2019, with net financial debt of EUR76.8m, versus EUR78.6m at
end-2019. Following the peak linked to the seasonality of purchases during the
first half of the year, financial debt decreased by EUR1.8m in line with the
Group's expectations. The Group's cash position represents EUR39.2m, including
its use of the EUR3.0m overdraft line.

For reference, following the agreement with the banking partners to reschedule
the syndicated credit agreement signed on 16 October 2019, the maturity of all
of Mr.Bricolage SA's bank borrowings was deferred to December 2026 (instead of
December 2023 for the majority of the borrowings). With the exception of the
EUR40m revolving credit, repayable at maturity at end-December 2026, the
repayment schedule for debt will be very gradual from December 2022 and no
covenants will apply before mid- 2022.

III - OUTLOOK FOR 2021

Building on the very good results achieved in 2020, the Mr.Bricolage Group has
started 2021 with a stronger financial structure and a more effective
competitive positioning. The trends are still buoyant at the start of this
year, but the context continues to be marked by the health crisis. The
Mr.Bricolage Group is therefore not publishing financial objectives, while
taking into account a hoped-for return to a more ordinary situation in 2021,
which should automatically be accompanied by a normalization of operating
expenditure, benefiting marketing actions and initiatives to support the
development and competitiveness of the member and affiliate networks.

Looking ahead to this, the Group has set itself objectives to continue moving
forward with and further strengthen:
* The optimization of network services and the accelerated development of
  value-creating actions: renewing the product selection and pricing
  management tools, standardizing the information systems, maintaining
  marketing investments in the Inventiv brand and in-store footfall;

* The development of the network of branded and affiliate stores, in France and
  internationally, to achieve or even exceed the ambition for 1,000 points of
  sale by 2028;
* The deployment of the 4 pillars concept within the network, setting out the
  brand's unique positioning around proximity;
* The human transformation of the head office and networks to bring to life the
  ambition to be the leader for proximity, adapting its positionings and
  practices, capitalizing on the skills of all of its employees and developing
  its talents.

Financial diary

Mr.Bricolage's General Shareholders' Meeting will be held on 21 April 2021 from
10am at its head office, located at 1 rue Montaigne, La Chapelle Saint Mesmin
(45), France. In the current health context, the conditions for taking part in
the general meeting could evolve, if required. Shareholders are invited to
regularly consult the "General Meeting" section on the company's site
(https://mr- bricolage.com/actualites/infos-reglementees/) in order to keep
informed.

ABOUT THE MR.BRICOLAGE GROUP

The Mr.Bricolage Group, which develops the well-known banners Mr.Bricolage and
Les Briconautes, is the French specialist for local independent home
improvement retail. As of January 31st, 2021, the Group has 879 stores
operating under the banners or through affiliates, including 71 international
stores across ten countries. Mr.Bricolage SA is listed on Euronext Growth Paris
(ISIN: FR0004034320 - ALMRB).

Contacts

- Corporate press - Louise Chaulin, louise.chaulin@gmail.com,
  +33 (0)7 83 35 96 93
- Financial press and investors - Marie Calleux, mrbricolage@calyptus.net,
  +33 (0)1 53 65 68 68

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13/03/2024 18:00

MR BRICOLAGE (EPA:ALMRB) - Mr.Bricolage: 2020 FULL-YEAR EARNINGS / Successful transition

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