Europlasma 2011 Consolidated Half Year ResultsBy Europlasma, PRNE
Wednesday, October 5, 2011
BORDEAUX, France, October 6, 2011 -
Europlasma’s Board of Directors met on 5 October 2011 under the chairmanship of Pierre Catlin and authorised the release of the consolidated accounts for the first half of 2011.
Turnover of EUR25.8m, +60% vs 30/06/10, with an increase in the majority of
Operating income of -EUR2.3m, -30% vs 30/06/10, affected by non-recurring
Net income, group share of -EUR2.6m, -101% vs 30/06/10, reflecting the
operating result and the negative share of income in the equity-accounted
Net investments of EUR10.2m compared with a net disinvestment of EUR0.4m at
30/06/10 linked to the development of the renewable energy production sector.
Net debt of -EUR0.6m compared with a net cash of EUR2.5m at 30/06/10, the
Group having self-financed significant investments in the period, and zero
debt ratio , the debt of the Group not being significant.
Commenting on these figures, Didier Pineau, the Managing Director, indicated:
«This first half year has been affected by non recurrent events, especially on Inertam; our first half usually do not reflect the whole year performance, as previously seen in the past years, due to turnover seasonality for most of our activities.And this year, the good news arrived after HY1 closing date, for instance SHARP contract successful completion with the attached bonus. The Board has also reviewed the 2011 full year landing and is positive about a clear recovery for the Group in HY2 2011. The Group confirms the high growth of 50% in turnover for full year 2011»
Activity and results
In thousand euros (EUR '000) 30/06/2011 30/06/2010 Change Turnover 25,760 16,117 9,643 60% EBITDA (529) (380) (150) (39%) Operating income (2,329) (1,791) (537) (30%) Ordinary income (2,325) (1,955) (370) (19%) Net income, group share (2,634) (1,312) (1,322) (101%) Earnings per share (in euros per share) (0.168) (0.114) (0.054) (48%)
The consolidated turnover totals €25,760 thousand, i.e. an organic growth of 60% compared to 30 June 2010.
Europlasma’s historical activity “Study and engineering, torches and processes” represented 3% of the consolidated turnover in HY1 2011 (compared to 8% in HY1 2010). Detailed engineering for the KNPP contract signed in 2010 with Iberdrola and Belgoprocess for the supply of a vitrification unit for low-level radioactive waste (Bulgaria) has been sent to the client.
The renewable energy production business generated a turnover of €5,707 thousand, representing 22% of the Group’s turnover in HY1 2011 (compared with 0% in HY1 2010). This revenue is linked to the construction of the first energy production factory at Morcenx which started on 1 December 2010 and of which the project management was entrusted to CHO Power SAS.
In parallel, the Group invoiced Synergy for the first feasibility study relating to the supply of several gasification units to the United States and ensured the monitoring of the development of pipeline projects.
The business of air and gas cleaningsolutions contributed by 63% to the consolidated turnover of HY1 2011, with revenues which total €16,308 thousand, compared with €10,619 thousand in HY1 2010. Activity in the first half of the year was dynamic with the focal point being the implementation of the Air Liquide contract for the supply of two gas treatment lines to the factory manufacturing 3SUN photovoltaic panels at Catane (Italy).
The business for the hazardous waste destruction contributed by 23% to the Group’s turnover with €3,151 thousand generated at 30/06/2011 compared with €4,177 thousand at 30/06/2010. The use of a new type of refractory in the furnace did not produce the expected result and affected production. Therefore, 1,769 tons have been treated at 30/06/2011 compared with 2,576 tons the previous year. However, the commercial business was very buoyant all throughout the first half of the year and the amount of waste arriving reached a new record, an increase of 15% over the previous year. This good commercial performance allowed for an increase in the production planning for the second half of the year.
The EBITDA show a deficit of -€0.5m compared with a deficit of -€0.4m at 30/06/2010. The operational performance of the Group during H1 2011 was affected by non-recurring negative factors. In particular:
- in January 2011, the renewable energy production sector reported fees that were paid to external advisors which helped the Group to close the financing for the construction of the first CHO factory at Morcenx;
- the performance of the hazardous waste destruction suffered the consequences of a reduction in production caused by using the new type of refractory. The melting furnace has since been completely reconditioned, but the negative consequences resulting from the unexpected shut-down could not be made up during HY1.
In parallel, the traditional activity of the air and gas treatment sector relied on contracts signed during previous periods, and, therefore, its margin was still affected by the effects of the financial crisis. The progressive return to pre-financial crisis margins is confirmed by new incoming orders.
The operating income totals -€2.3m, compared with -€2.0m at 30/06/2010. Net appropriations to amortisations and depreciations increased from -€1.4m at 30/06/2010 to -€1.8m at 30/06/2011. This increase is a result of a reduction in write-backs of -€0.3m and an increase in appropriations of €0.1m. The Group did not record significant depreciation on assets for the period.
The net result (group share) saw a loss of €2.6m compared with a loss of €1.3m in H1 2010.
The share of profits in the equity-accounted companies amounts to a loss of €0.2m compared with €0.0m at 30/06/2010. This share of losses is linked to the equity-accounted company CHO Morcenx of which the factory is in the process of being constructed and is still not active. The percentage held by the Group in CHO Morcenx increased from 4% at 31/12/2010 to 25% at 30/06/2011 after reaching the set targets.
Appropriations for goodwill amortisation increased by €0.1m which essentially corresponds to the amortisation of goodwill reported during the period with the increase in the Group’s shareholding in CHO Morcenx. See comments below about the balance sheet.
The share of minority interests in the net result amounts to a loss of €0.3m compared with a loss of €0.5m at 30/06/2010.
Cash flows and balance sheet
In thousand euros (TEUR) 30/06/2011 31/12/2010 Change Fixed assets 45,479 38,332 7,147 19% Current assets 22,432 20,142 2,290 11% Marketable securities and cash at bank 12,175 14,466 (2,291) (16)% Total equity - Group share 36,133 38,829 (2,696) (7)% Minority interest 3,503 3,865 (362) (9)% Other equity and provisions 1,078 1,813 (735) (41)% Financial liabilities * 12,792 12,016 776 6% Payables and deferred income 26,580 16,416 10,163 62% Net (debt)/cash (618) 2,450 (3,067) (125)% Gearing ratio - Net debt / (net debt + equity) 0.0 (0.1) 0.1 (125)% Ratio net debt / EBITDA 1.2 (6.5) 7.6 (118)% Cash generated from operations before changes in working capital (255) (28) (227) 797% Net (investments)/disinvestments (10,222) 353 (10,565)(2997)%
* Financial liabilities have been impacted by a 784 K€ presentation adjustment from other equity. At 31/12/2010, financial liabilities and other equity amounted to 12 800 K€ and, at 30/06/2011, to 12 792 K€.
The total balance sheet amounts to €80.1m compared with €72.9m at 31/12/2010, i.e. an increase of €7.1m or +10%.
Within the balance sheet assets, this increase essentially relates to fixed assets. The main items concerned are the following:
- net goodwill +€3.9m, i.e. +33%; the significant change results mainly from the recognition of a gross goodwill increase of €4.6m in the holding share within the equity-accounted company CHO Morcenx following the exerce of two successive tranches of share warrants during HY1 2011 for an almost-zero strike price;
- long-term investments +€1.5m, i.e. +18%; this net change is broken down by an increase of €7.5m in deposits and guarantees integrally linked to the guarantees offered on the EPC contract for CHO Morcenx and a decrease of €6.0m in long-term investments corresponding to the value of 2 tranches of share warrants in CHO Morcenx exercised during the period;
- investments in associates +€1.3m, i.e. +644%; the increase, above all, results from the holding percentage increase in CHO Morcenx which rose from 4% at 31/12/2010 to 25% at 30/06/2011, generating +€1.5m as the result of the change in scope of consolidation.
Within balance sheet equity and liabilities, the increase essentially focuses on trade creditors and other operating payables which have increased from €4.9m, i.e. +74%, and €5.2m, i.e. +54% respectively. These changes, linked to the strong growth of the business, are partly offset by the decrease in consolidated equity by some €3m.
The Group’s net debt which amounts to €0.6m is not significant. In effect, the Group did not require external financing for the significant investments within the business sector for renewable energy production done in this half of the year. These net investments of €10.2m were therefore financed thanks to the increases of capital in summer 2010 and to positive net flows generated by the business in HY1.
Post balance sheet events and trends for the year-end 2011
Post balance sheet events
The Board of Directors of October 5th 2011 has decided the IFRS transition for FY 2011. The Group consolidated financial statements will be presented according to International Financial Reporting Standards for the first time for the year ending December 31st 2011.
Study and engineering, torches and processes
The scheduled order of spare parts as part of the KNPP contract was received. In addition, the client has asked for the subsequent payments to be deferred for one year. An amendment to take this one-year period into account within the execution of the contract is currently being negotiated.
Production of renewable energy
The Synergy Group ordered a new feasibility study which aims to set the construction price for an energy production installation in the United States. An order for an EPC contract is currently being negotiated.
Air and gas cleaning solutions
The Group successfully concluded the Air Liquide contract with the industrial commission of two gas treatment lines. As such, the Group has been granted an exceptional bonus which will be recorded in the second half of the year.
Destruction of hazardous waste
The public organisation “Réseau Ferré de France” (RFF) has made an order for the treatment of approximately 500 tons of asbestos waste. EDF has also ordered the recycling of around 400 tons coming from the site deconstruction of the Albi factory. Other orders on the same scale are being negotiated with other French and foreign companies.
Trends for 2011
The target growth of 50% of consolidated turnover is confirmed. This confirmation is, in particular, based on:
- the expected cumulative progress by about 90% of the EPC contract for the CHO factory at Morcenx;
- the continued commercial success of treating asbestos waste and optimising the production planning in HY2 and
- reporting the bonus linked to the satisfactory conclusion of the Air Liquide contract.
In view of the aforementioned elements, the results for the second half of 2011 will reflect a significant improvement compared to the performance of the first half of the year.
Next financial publication: 2011 Annual consolidated results - mid-April 2012
Europlasma is a French Group operating in the clean technologies and renewable energy production industries. Founded in 1992 to apply its proprietary plasma torch technology to hazardous waste destruction, it is now built on the following four business units:
- Europlasma is a world-wide supplier of plasma heating systems and related applications
- Inertam is the global specialist in the destruction and recycling of asbestos and hazardous waste
- Europe Environnement is the European expert in industrial ventilation and gas cleaning systems.
- CHO Power is a producer of electricity from waste and biomass gasification.
www.europlasma.com [Alternext - NYSE Euronext Paris - Mnemo : ALEUP - Isin : FR0000044810]
This release contains provisional information and statements based on the best estimates of the Management at the date of their publication. This information is, by nature, subject to risks and uncertainties which are difficult to predict and generally outside of the Group’s field of action. These risks include the risks listed in the Group’s reference document available on its website www.europlasma.com.
Consequently, the future performance of the Group may differ significantly from the provisional data communicated and the Group can make no commitment to the achievement of these provisional elements.
BALANCE SHEET (TEUR) 30/06/2011 31/12/2010 Goodwill 15,552 11,673 Intangible assets 2,208 2,325 Tangible assets 16,682 16,078 Financial investments 9,533 8,053 Investments in associates 1,505 202 Total Fixed Assets 45,479 38,332 Inventories 2,433 1,830 Trade receivables and related accounts 13,947 13,014 Other receivables and prepayments 6,052 5,298 Marketable securities 2,418 2,676 Cash at bank 9,757 11,790 Total Assets 80,085 72,940 Share capital 15,656 15,285 Share premium 34,658 34,670 Translation reserve 45 71 Other reserves (11,583) (11,978) Net income of the financial year (2,634) 781 Others (9) 0 Total Equity - Group share 36,133 38,829 Minority interest 3,503 3,865 Total Equity - Consolidated 39,636 42,694 Other equity 0 784 Provisions 1,078 1,029 Financial liabilities 12,792 12,016 Trade payables and related accounts 11,610 6,680 Other payables and deferred income 14,970 9,736 Total Equity and liabilities 80,085 72,940
CONSOLIDATED INCOME STATEMENT (TEUR) 30/06/2011 30/06/2010 Turnover 25,760 16,117 Other operating revenues 2,868 802 Purchases consumed (22,280) (10,837) Employee benefit expensesl (6,309) (5,991) Other operating charges (132) (31) Taxes (436) (440) Net change in depreciation, amortisation and provisions (1,800) (1,412) Operating income (2,329) (1,791) Financial income 4 (164) Ordinary income of the integrated companies (2,325) (1,955) Extraordinary income 0 197 Income tax 78 389 Net income of the integrated companies (2,247) (1,370) Share of (loss)/profit of associates (175) 1 Goodwill amortisation (535) (447) Net income of the consolidated group (2,958) (1,815) Minority interest 323 503 Net income (group share) (2,634) (1,312) Basic earnings per share in EUR (0.168) (0.114) Number of shares 15,656,035 11,511,752 Diluted earnings per share in EUR (0.132) (0.076) Fully diluted 19,892,903 17,285,252
CONSOLIDATED CASH FLOW STATEMENT (TEUR) 30/06/2011 30/06/2010 Net income of the integrated companies (2,247) (1,370) Adjustments for depreciation and amortisation 1,890 1,727 Adjustments for deferred taxation 97 (123) Adjustments for (gains)/losses on disposal of fixed assets 6 (283) Other non-cash items 20 Total cash generated from operations before changes in working capital (255) (28) Dividends received from associates 0 0 Changes in working capital 7,435 (2,420) Net cash from operating activities 7,180 (2,448) Acquisition of fixed assets (1,885) (786) Proceeds from sale of fixed assets 10 (1,139) Impact of changes in the consolidation scope (10) 0 Net change in short- and mid-term investments -8,337 0 Net cash used in investing activities (10,222) 353 Dividends paid to minority shareholders 0 0 Proceeds from issue of share capital 0 2 Proceeds from investment grants 0 154 Proceeds from loans and borrowings 624 519 Repayment from loans and borrowings (536) (1,150) Net change in overdraft 0 1 Net cash from financing activities 87 (473) Translation differences (249) 11 Net change in cash and cash equivalents (3,204) (2,558) Cash and cash equivalent at opening date 13,205 13,917 Cash and cash equivalent at closing date 10,002 11,358
SEGMENT REPORTING (T€)
Study and engineering Renewable Holding and R&D torches and energy activities processes production Europlasma Europlasma Holding and R&D, SC Immobilière Plasma torch CHO Power and Gazéification activity CHO Morcenx 2011 2010 % 2011 2010 % 2011 2010 % Turnover 20 184 B 575 257 B 5707 6527 B Operating income -1404 -1970 B 220 -93 B 76 2558 B Tangible assets 2764 1344 106% 0 0 0% 0 0 0% Intangible assets 0 0 121% 129 168 -23% 1979 2027 -2% Goodwill 0 0 0% 0 0 0% 4462 0 0% Financial investments & investements in associates 0 0 0% 19 18 5% 10765 7944 36% Fixed assets 2764 1344 106% 148 186 -21% 17206 9970 73%
Hazardous waste Air and gas destruction cleaning solutions TOTAL FIG and Europe Inertam Environnement 2011 2010 % 2011 2 010 % 2011 2 010 % Turnover 3151 8982 B 16308 24885 B 25760 40 836 B Operating income -1076 208 B -145 -245 B -2329 458 B Tangible assets 5634 6127 -8% 8284 8607 -4% 16682 16 078 4% Intangible assets 27 35 -23% 73 95 -23% 2208 2 325 -5% Goodwill 3174 3288 -3% 7916 8385 -6% 15552 11 673 33% Financial investments & investements in associates 0 0 0% 254 294 -14% 11037 8 256 34% Fixed assets 8835 9450 -7% 16527 17382 -5% 45479 38 332 19%
A) Presentation adjustments on fixed assets have been made as at June 30th 2011 between the segments Hazardous Waste Destruction and Engineering and Plasma Torches. As at December 31st 2010, Hazardous waste destruction’s Tangibles should have been of TEUR 5 343 (instead of TEUR 6,127) and Engineering and Plasma Torches’ tangibles should have been of TEUR 2,127 (instead of TEUR 1,344).
B) Comparative data is shown at December 31st 2010.
Press and investor contacts
Didier PINEAU, Chief Executive Officer / Anne BORDERES in charge of
Estelle MOTHAY, Chief Financial Officer
Tags: Bordeaux, Europlasma, France, October 6