Cembre

The Board of Directors approved the Draft Financial Statements of Cembre S.p.A. and the Consolidated Financial Statements at December 31, 2018

CEMBRE (STAR): The Board proposes a €0.90 dividend per share (+12.5%)
Consolidated sales grew to €144.1 million (+8.6%)
Consolidated net profit amounted to €22.7 million

11/03/2019

(Brescia, 11th March 2019, h 02:16 pm)

  • Consolidated net financial position positive for €7.5 million
  • Tax benefit from application of Patent Box tax regime for 2018 amounting to €1.8 million
  • Shareholders’ Meeting called on April 18
  • Requisites for the independence of Independent Directors were assessed
  • Request to the Shareholders’ Meeting convened for April 18 to resolve on the proposal for an incentive plan pursuant to article 114-bis of Legislative Decree 58/1998 and to resolve on the request for authorization to purchase and dispose of own shares
 

 

(euro ‘000)

2018

Margin %

2017

Margin %

change

Revenues from consolidated sales

144,096

100

132,637

100

8.6%

Consolidated gross operating result

35,650

24.7

33,434

25.2

6.6%

Consolidated operating result

28,496

19.8

27,036

20.4

5.4%

Consolidated pre-tax result

28,365

19.7

26,575

20.0

6.7%

Consolidated net result

22,736

15.8

22,727

17.1

0.0%

Consolidated net financial position

7,531

 

20,232

 

 

 

Brescia, March 11, 2019 - The Board of Directors of Cembre S.p.A. – a STAR segment listed company and one of the largest European producers of electrical connectors and tools for their installation – approved at today’s meeting chaired by its Chairman and Managing Director Giovanni Rosani the Draft Statutory Accounts of Cembre S.p.A. and the Consolidated Financial Statements at December 31, 2018.

With regard to Corporate Governance, the Board, having acknowledged the representations made by Independent Directors and on the basis of independent information acquired, ascertained the possession of requisites for independence – pursuant to article 148, paragraph 3, of Legislative Decree 58/1998, as referred to by article 147-ter, paragraph 4 of Legislative Decree 58/1998 and article 3 of the Code of Conduct issued by the Corporate Governance Commitee – of said Independent Directors.

 

The Board of Directors of Cembre also resolved to propose to the Shareholders’ Meeting called on April 18, 2019 (April 19 on second call, if necessary), the distribution of a €0.90 dividend for each of the shares in circulation according to the following calendar: ex-dividend date May 6, 2019; record date May 7, 2019 and payment date May 8, 2019.

 

At the end of 2018, consolidated revenues amounted to €144.1 million, up 8.6% on €132.6 million at the end of 2017.

In 2018, Group sales in Italy amounted to €59.0 million, up 6.2% on the previous year; revenues in the rest of Europe increased by 15.3% to €62.6 million, while sales in non-European markets decreased by 1.4% to €22.4 million. A total of 41.0% of Group sales in 2018 were represented by Italy (as compared with 41.9% in 2017), 43.5% by the rest of Europe (41.0% in 2017), and the remaining 15.5% by the rest of the World (17.1% in 2017).

Consolidated revenues for 2018 benefited from the acquisition of the German company IKUMA KG which, in the relevant period (from 05.01.2018 to 12.31.2018), achieved a turnover of €5.2 million; without this contribution, the increase in consolidated sales would have been equal to 4.6%.

 

Consolidated gross operating profit amounted in 2018 to €35.7 million, representing a 24.7% margin on sales, up 6.6% on €33.4 million in 2017, when it represented a 25.2% margin on sales. The incidence of cost of sales decreased compared to 2017, from 33.1% to 32.6%, while the weight of services costs rose slightly, from 13.1% to 13.5%. On the other hand, the incidence of personnel costs decreased from 28.1% to 27.8%, despite the average workforce having grown from 689 units in 2017 (including 39 temporary workers) to 747 units in 2018 (including 58 temporary workers and 18 employees of IKUMA KG).

 

Consolidated operating profit for 2018 amounted to €28.5 million, representing a 19.8% margin on sales, up 5.4% on €27.0 million in 2017, when it represented a 20.4% margin on sales.

 

Consolidated profit before taxes amounted in 2018 to €28.4 million, representing a 19.7% margin on sales, up 6.7% on €26.6 million in 2017, when it represented a 20.0% margin on sales.

 

Consolidated net profit for the year amounted to €22.7 million, representing a 15.8% margin on sales, stable compared to 2017, when it also amounted to €22.7 million and represented a 17.1% margin on sales. On December 22, 2017, Cembre S.p.A. had reached an agreement with Tax Authorities on the application of the Patent Box Regime, as a result of which a total tax benefit of €3.9 million had been recorded for the 2015, 2016 and 2017 financial years, while for 2018, €1.8 million was recorded. By eliminating the effect of the tax benefit related to the application of the Patent Box regime, the consolidated net result would have been equal to €20.9 million, corresponding to 14.5% of sales and would have increased by 11.2% compared to the net result for the previous year, which, after adjusting for the same tax benefit, would have amounted to €18.8 million.

 

In 2018, non-recurring costs related to the acquisition of IKUMA KG were incurred for €411 thousand; in 2017, similar costs were incurred for €52 thousand and non-recurring revenues of €502 thousand were realized, deriving from the sale of the property former office of Cembre Espana SLU. Eliminating the incidence of these non-recurring components, the following profit margins are obtained:

(euro ‘000)

2018

%

2017

%

Change

Revenues from sales and services

144,096

100.0%

132,637

100.0%

8.6%

Gross Operating Result

36,061

25.0%

32,984

24.9%

9.3%

Operating Result

28,907

20.1%

26,586

20.0%

8.7%

Pre-tax result

28,776

20.0%

26,125

19.7%

10.1%

 

The net financial position went from a surplus of €20.2 million at December 31, 2017 to a surplus of €7.5 million at December 31, 2018. In this regard, it is noted that the acquisition of IKUMA KG involved an outlay of €8.6 million and that, in 2018, dividends were paid for €13.4 million, higher than those paid in 2017 of €11.8 million.

 

Investments made in the period amounted to €17.8 million in tangible assets (€11.7 million in 2017) and €3.2 million in intangible assets (€1.1 million in 2017). Increases in intangible assets include €2.0 million relating to the value of the IKUMA KG customer list and €0.5 million related to the IKUMA KG brand value, deriving from the purchase value allocation of said company. In addition to the foregoing, with regard to investments, it is noted that Goodwill of €4.6 million was recorded as assets for the acquisition of IKUMA KG.

 

“In 2018, the Cembre Group reported consolidated revenues of €144.1 million, up 8.6% on the previous year. Consolidated net profit reached €22.7 million, remaining unchanged compared to 2017; however, eliminating the effect of the tax benefit related to the application of the Patent Box regime, the consolidated net result would have been equal to €20.9 million, up 11.2% compared to the net result of the previous year which, after adjusting for the same tax benefit, would have amounted to €18.8 million.

The turnover of the Cembre Group in the first two months of 2019 has increased by 8.2%. We trust that the Group’s turnover will continue to grow in 2019” - said CEO Giovanni Rosani.

“The Group has a solid financial position amounting at December 31, 2018 to a surplus of €7.5 million, remaining stable at February 28, 2019 at €8.7 million. A proposal for the distribution of a €0.90 dividend per share (the dividend paid for financial year 2017 amounted to €0.80). The proposed dividend corresponds to 66.2% of consolidated net profit” - continued G. Rosani.

 

In 2018, the parent company Cembre S.p.A. recorded sales revenues of €109.1 million, up 5.4% on the same period of 2017. The gross operating result went from €26.9 million to €29.4 million, up 9.5%. Instead, the operating result increased by 9.3%, from €21.2 million in 2017 to €23.2 million in 2018. The net profit of Cembre S.p.A. was €21.3 million, compared to €24.4 million in the previous year, a decrease of 13.0%. The net result for 2017 of Cembre S.p.A. had benefited from a positive tax component of €3.9 million, deriving from the application of the Patent Box regime for 2015, 2016 and 2017, while this benefit in 2018 was €1.8 million. Net of said tax benefit, net profit for 2018 would have amounted to €19.4 million, representing a 17.8% margin on sales and an 8.4% decrease on 2017, net of the same benefit. This decrease is also due to the fact that, in 2018, Cembre S.p.A. collected dividends from its subsidiaries for a total of €2.7 million, while in 2017 the dividends collected amounted to €5.3 million.

 

* * * *

 

Proposal to the Shareholders’ Meeting to adopt an incentive plan pursuant to art. 114-bis of Legislative Decree 58/1998 called “Carlo Rosani Prize for the 50th anniversary of the foundation of the Company”

 

The Board of Directors resolved to submit to the next Shareholders’ Meeting the adoption of an incentive plan pursuant to art. 114-bis of the TUF based on Cembre shares and intended for employees (or however holders of a comparable relationship pursuant to the legislation applicable from time to time) of Cembre and/or its subsidiaries that will be identified by the Board of Directors. The relative illustrative report and the annexed Information Document prepared pursuant to art. 84-bis of Consob Regulation no. 11971/1999 will be made available on the Cembre website www.cembre.com in accordance with the law.

 

* * * *

 

Request of the Board of Directors to the Shareholders’ Meeting of an authorization to purchase own shares

 

At today’s meeting, the Board of Directors resolved to submit to the upcoming Shareholders’ Meeting a request to be authorized to purchase own shares after the authorization granted by the Shareholders’ Meeting of April 26, 2018 has been revoked with reference to the unexercised part. The request aims at providing the Company with strategic investment opportunities to any end allowed by current regulations, including those contemplated under article 5 of EU Regulation 596/2014 (Market Abuse Regulation, MAR) and in the procedures contemplated under article 13, MAR, as well as, where necessary, for the provision of own shares to be allocated to the beneficiaries of the incentive plan pursuant to art. 114-bis of the TUF called “Carlo Rosani Prize for the 50th anniversary of the foundation of the Company”, which will be submitted to the next Shareholders’ Meeting.

The authorization to purchase own shares is requested for a period of 18 months from the date of the Shareholders’ Meeting and is intended for the purchase of Cembre ordinary shares of par value €0.52, up to a the maximum limit established by current regulations for a consideration that shall not exceed the higher between the price at which the last independent transaction was concluded and the last independent bid price in the market in which the purchase is carried out. For any single purchase, such price per share shall in any case not be more than 20% lower or higher than the closing price registered by Cembre shares on the previous trading day.

The authorization to sell own shares is requested without a time limit; the Board resolved to propose that the provision can take place, among other things, by means of provision thereof in favor of the beneficiaries of the incentive plan pursuant to art. 114-bis of Legislative Decree 58/1998 called “Carlo Rosani Prize for the 50th anniversary of the foundation of the Company”, under the terms, conditions and methods provided therein and, in particular, at the price of €10 per share.

At the date of the present press release, Cembre holds 280,041 own shares, representing 1.647% of the share capital of the Company.

 

* * * *

 

Cembre designs, manufactures and distributes electrical connectors and cable accessories.It enjoys a leadership position in Italy and significant market shares in the rest of Europe. It is also the world’s largest producer of connector installation tools (mechanical, pneumatic and hydraulic) and tools for cable shearing. The products it has developed for connection to the rail and for other railway applications are used by the main companies in this sector round the world.

Cembre owes its success to an insistence on innovative, high-quality products, a broad and thorough collection, and an extensive distribution network both in Italy and abroad.

Founded in Brescia in 1969, the Cembre Group is now a full-fledged international force. Along with the parent company in Brescia it has six subsidiaries: five trading companies (2 in Germany, 1 in France, Spain and the United States) and one manufacturing and trading subsidiary (Cembre Ltd., in Birmingham, U.K.), for a total workforce of 729 as of December 31, 2018. Since 1990, its products have been certified by Lloyd’s Register Quality Assurance for the design and production of accessories for cables, electrical connectors and tools for their installation.

Cembre has been listed on the Italian Stock Exchange since December 15, 1997, and on the STAR section since September 24, 2001.

 

Contacts: Claudio Bornati (Cembre S.p.A.) 030/36921    claudio.bornati@cembre.com

 

Further information is available at Cembre’s institutional website www.cembre.com in the Investor Relations section.

 

The manager responsible for preparing the Company’s financial reports, Claudio Bornati, declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the document results, books and accounting records.

Attachments - 2018 Financial Statements:

  • Consolidated Balance Sheet
  • Consolidated Comprehensive Income Statement
  • Consolidated Statement of Cash Flows
  • Balance Sheet of parent company Cembre S.p.A.
  • Comprehensive Income Statement of parent company Cembre S.p.A.
  • Statement of Cash Flows of parent company Cembre S.p.A.

 

At the date of the present press release the auditing of the financial statements has not yet been completed.

 

In the present document use is made of “alternative performance indicators” which are not provided for under European IFRS, and whose significance and content are illustrated below (in line with Recommendation CESR/05-178b published on November 3, 2005):

Gross Operating Result (EBITDA): defined as the difference between sales revenues and costs for materials, of services received, and the net balance of operating income and charges. It represents the profit achieved before amortization, financial flows and taxes.

Operating Result (EBIT): defined as the difference between the Gross Operating Result and the value of amortization/impairment. It represents the profit before financial flows and taxes.

Net Financial Position: it represents the algebraic sum of cash and cash equivalents, financial receivables and current and non-current financial debt.

 

 

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Anmerkungen und rechtliche Informationen

Cembre Via Serenissima, 9 - 25135 Brescia - ITALY
© Copyright 2019 Cembre S.p.A.

CODICE FISCALE – P.IVA: 00541390175
ISCRIZIONE AL REGISTRO DELLE IMPRESE: n. 00541390175 Brescia
CAPITALE SOCIALE: € 8.840.000 i.v.