PRESS RELEASE
Épernay, 17 December 2007
Our business is spraying!
Exel increases its profitability Current Operating Profit for 2006-2007 up by + 22.4%
Consolidated IFRS In millions of Euros Sales Added value EBITDA Current Operating Profit Operating Profit Profit before tax Net profit Operating Cash-flow
2005/2006 276.7 111.1 29.0 24.6 26.3 25.5 16.8 13.8
2006/2007 296.0 119.6 32.6 30.1 30.5 30.0 20.2 23.4
Change + 7.0% + 7.7% + 12.4% + 22.4% + 16.1% + 18.0% + 20.3 % + 69.5 %
EXEL Industries has improved its performance for the fifth year in succession. Its current operating profit is up by +22.4% to 30.2 M€. It now represents 10.2% of the group’s consolidated sale, as against only 8.9% one year earlier. These good results, which were achieved in an uneven climate (fall in sales over the first semester) and a weak dollar, show once more how the group is able to improve its profitability.
Analysis of annual results
Over the financial year ending on 31 August 2007, the EXEL Industries group achieved consolidated sales of 296.0 M€, up by +7.0% compared with the previous financial year. After a drop of -1.8% over the first semester, the second part of the financial year was very
dynamic, due in particular to a strong increase of activity both in Plant and in Material Protection. Thanks to the growth in its activity and the efforts that had already been undertaken to reduce its costs, the group is now showing an increased Current Operating Profit of +22.4%. Despite the fall in the dollar in relation to the euro (a loss on exchange rate of 1.7 M€), the Net Profit emerges as up by + 20.3 % at 20.2 M€ (of which 0.4 M€ represents non-recurrent profits). Over this same period, Equity has grown to reach 139.0 M€ on 31/08/2007. It now represents almost 58% of the total balance sheet. The Working Capital Requirement stands at 20% of sales, as against 21% one year previously. As for cash position, net of all financial debts, these stand at 46.8 M€ as against 32.3 M€ a year ago, representing an increase of 14.5 M€ (+ 45%), this despite net investments of 5.0 M€ (acquisition of Moreau, the Vermorel factory in Romania, launch of new products).
Development of activity by market
Materials Protection Over the financial year 2006-07, the sales in Materials Protection has increased by +6.1%, reaching 139.2 M€. Profit margins are also improving thanks, in particular, to good performances from Sames, following on the company’s repositioning and the reorganization that was carried out in the course of the previous financial year. Thanks to launch of new innovative and more competitive products, EXEL Industries was able to take advantage of the investments undertaken by its industrial customers to limit their costs, reduce their emissions of volatile organic compounds and set up new factories in areas where the demand is strongly increasing (emerging countries). In addition, the fact that export markets in Asia and Europe behaved favorably has more than compensated for the wait-and-see attitude of North American markets (weakness of the dollar in relation to the euro and slowdown in the US economy). Plant Protection Development of our activity in Plant Protection has been a matter of sharp contrasts during this financial year. After a drop of -6.1% in sales for the first semester, activity picked up strongly in the second semester (increase in sales of +21.6% to 87.6 M€). This new situation, which has had a positive impact on the development of the Current Operating Profit of the group, arises from the convergence of several very positive factors: The pick-up in investments in the agricultural field, encouraged by high cereal prices and the need to increase farming yields in order to meet the increased demand for agricultural produce. A proportion of such investments naturally goes towards the purchase of new sprayers, which are still the farm’s principal tool for increasing yields.
Equipping farmers in Eastern European countries wishing to modernize their farms and to make them more competitive. This growth potential, that was identified some years ago, has enabled EXEL Industries to build up an appropriate development strategy for these markets and to begin to harvest the first fruits from them. Over the 2006-2007 financial year, this was particularly evident in the increase of +39% in export sales achieved in Plant Protection. The need for new sprayers that are ever more environment-friendly has been encouraged by such initiatives as the “Grenelle de l’environnement” and by new regulations such as the Law on Water and the Decree on the Use of Pesticides. This is why EXEL Industries regularly renews its ranges and why it has set respect for the environment as its priority research and development aim. The financial year 2006-07 has therefore enabled the EXEL Industries group to consolidate its leading position and to build up its strength both financially (through improvement in profitability and in its financial structure) and industrially, with the acquisition of Moreau, the successful recovery of Sames, the international development of the Plant Protection, the renewal of its product ranges and innovation (12 new patents lodged in the course of the financial year).
About EXEL Industries: www.exel-industries.com A world-class specialist in precision sprayers for agriculture and industry, EXEL Industries employs, since Hardi’s integration, nearly 2,800 people in 20 countries. In fiscal year 06/07, the group reported sales of €296 million, i.e. a 7.0% increase, and operating profit of €30.5 million, i.e., 10.3% of sales. ISIN code FR0004527638, Euronext Paris, Compartment B, NextPrime, Indices SBF 250, CAC Mid&Small 190, Small 90.
YOUR CONTACTS Patrick Ballu Chairman and CEO Tel.: +33 3 26 51 52 55 Julien Perez Analyst/Investor Relations Tel.: +33 3 26 51 18 84