Ideal Standard International S.A. Reports 2016 Preliminary Results

  • Ideal Standard Group achieves sales growth of 7.1% at constant currency and EBITDA increases by 14%
  • Issue of €75m Series AAA Notes to support the company’s growth ambitions
  • Graham Oldroyd joins Ideal Standard International N.V.’s Board of Directors as Chairman

Ideal Standard International S.A., the leading manufacturer of residential, commercial and healthcare bathroom solutions, announces its preliminary (unaudited) results for the year ended 31 December 2016 and the issue of additional Series AAA Notes to implement its long-term growth strategy.

Financial Highlights

 

31 Dec 16

€m

(unaudited)

31 Dec 15

€m

(audited)

Change

%

Revenues

                         739.0

                  726.0

               + 1.8%

Gross Profit

                         251.4

                  237.9

               + 5.6%

Adjusted EBITDA

                           81.2

                    71.2

               + 14.0%

EBITDA margin                                                                 11.0%                               9.8%                     +1.2pts

  • The strong revenue growth of 7.1% in constant currency was partially offset by an unfavourable foreign exchange impact of 5.3%. Total revenues increased by €13.0m, or 1.8%, to €739.0m in the year ended 31 December 2016.

−       European Revenues grew in constant currency by 5.8% mainly driven by volume growth across our main markets, partially offset by unfavourable currency effects. After foreign exchange impacts European revenue increased by 2.7%.

−       Revenue in the Middle East North Africa Region (MENA) grew by 13.9% mainly driven by increased volume in Egypt, whereas revenue in the Gulf region remained broadly flat despite the macro-economic and political challenges in the region. After the significant foreign exchange impact MENA revenue decreases by 2.8%.

  • Adjusted EBITDA increased by €10m, or 14% to €81.2m. This performance is mainly driven by good sales volume growth and the benefits from productivity measures partially offset by foreign exchange effects.

−       European adjusted EBITDA increased by 15.3% to €51.0m (2015: € 44.2m) driven by higher sales volumes in our key markets; the benefits of productivity gains and procurement savings; partially offset by SG&A investments and the negative impact from foreign exchange evolution.

−       Adjusted EBITDA in MENA grew by 12.6% to €30.4m (2015: €27.0m) mainly driven by improvement of manufacturing performance, higher volume sales in Egypt, pricing performance, and profitable sales in the Gulf region.

€75m Series AAA Notes issuance & RCF Maturity extension

The company announces it has completed the issuance of €75m in aggregate principal amount of Series AAA notes. The issuance resulted in cash proceeds that will be used to fund the company’s long-term strategy, including significant capacity and technology investments to drive future growth.

In addition, Ideal Standard also informs that the maturity of its Revolving Credit Facility (RCF) has been extended to March 2018, in agreement with the company’s financial institutions Goldman Sachs and Deutsche Bank.

Graham Oldroyd appointed Chairman of the Board of Directors

With the additional financing successfully completed, Ideal Standard can now fully focus on implementing its long-term growth strategy and continuing to build the organization for future success.

Within this framework, the company is pleased to announce that Mr. Graham Oldroyd has been appointed as Chairman of Ideal Standard International N.V.’s Board of Directors effective as from February 22nd.

Mr. Oldroyd is a highly experienced Non-Executive Chairman / Non-Executive Director across a wide range of sectors and geographies. With more than 23 years in private equity, Mr. Oldroyd has a strong background in strategic development, organization-wide operational excellence and performance improvements.

The former Chairman, Mr. Nedim Cen, will continue to contribute to the company’s development as Chairman of the Board of the Group’s holding companies in Luxembourg as well as a Non-Executive Director in the Board of Ideal Standard International N.V.

Commenting on the 2016 results Torsten Tuerling, the Group’s Chief Executive Officer Torsten Tuerling, stated:

“I am very pleased with the performance of our company in 2016. As visible in our preliminary financial results, we made very good progress in the implementation of our long-term strategy, despite significant currency headwinds. We are well on our way towards our objective of becoming the leading provider of residential, commercial and healthcare bathroom solutions.”

“We are also grateful for the trust that our investors put into the success of our long-term strategy. The secured additional funding will allow us to step up investments and enhance the value created through our strategy.”

“Finally, I am delighted to welcome Graham Oldroyd as our Chairman of the Board. Mr. Oldroyd has an invaluable experience in developing companies to their full potential. I am looking forward to closely work together with Graham as we continue to implement our value creation strategy. At the same time, I would like to thank Nedim Cen for his great support in the last year that helped us to develop and fund our new long-term strategy.”

Enquiries:

Ideal Standard International
+32 (0) 2800 4800
investor.relations@idealstandard.com

Zubair Javeed     – Chief Financial Officer
Sven Voet            – Corporate Communications

About Ideal Standard International

Ideal Standard International is a privately-owned company manufacturing bathroom ceramics, taps & fittings, fixtures and accessories providing innovative solutions for the residential, commercial and healthcare sectors. It operates across a portfolio of brands, among them industry leading brands Ideal Standard, Armitage Shanks, Porcher, Sottini, Ceramica Dolomite, or Vidima. The Group is headquartered in Brussels, Belgium and operates in over 30 countries and regions employing almost 9,500 people and works with world class designers to develop innovative products using the latest technologies.

About the Series AAA Notes

The Series AAA – tranche super priority PIK senior secured notes due 2018 (the “Series AAA Notes”), were purchased by certain holders of the Company’s existing Series A and Series B Notes.

The Series AAA Notes were issued pursuant to the Company’s existing senior secured notes indenture, dated as of June 4, 2014, as amended (the “Indenture”). With respect to proceeds of any enforcement of collateral, the Series AAA Notes will rank behind the obligations under the Senior Revolving Credit Facility Agreement and certain hedging obligations, but in priority to obligations under the other Notes.

This announcement is for informational purposes only, and does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of an offer to purchase or subscribe for, any securities of Ideal Standard International S.A. or any of its affiliates. This announcement is not for distribution or release in or into any jurisdiction in which offers or sales would be prohibited by applicable law.

The Series AAA Notes have not been and will not be approved or recommended by any U.S. federal, state or foreign jurisdiction or regulatory authority. The Series AAA Notes were offered and sold, (a) in the United States, only to “qualified institutional buyers” (as that term is defined in Rule 144A under the U.S. Securities Act) and (b) outside of the United States, only to holders that are not “U.S. persons” (as that term is defined in Rule 902 under the U.S. Securities Act) in reliance on Regulation S under the U.S. Securities Act.