Zignago Vetro Group operating growth continues in H1 2016

The Board of Directors of Zignago Vetro S.p.A has approved and released the company’s 2016 Half Year Rep

Operating performance
In the first half of the year, Beverage and Food glass container demand in Italy and Europe continued to steadily develop, supported by finished product export demand and also by a contained recovery in domestic consumption.
The global Perfumery markets continued to expand, with divergent performances across the various regions. The Luxury segment of the Perfumery market continued to feature excess supply, against demand which – although improving – stemmed mainly from long-standing products and the use principally of flankers for new initiatives.
Demand in some Cosmetics sector segments slowed (in particular for nail varnish containers), impacted in part by socio-political conditions in a number of countries. However, positive signals emerged from some regions, including emerging economies, with a particular demand for high product quality. The skincare segment continued to grow.
Overall, in the first half of the year the Group improved revenues – driven by volume growth.
Results were impacted by a number of non-recurring events, some of which external to the company and particularly in Verreries Brosse following the repeated strikes called in France in response to the Government’s labour market reform initiatives.
Consolidated Revenues in H1 2016 amounted to Euro 166.5 million compared to Euro 160.6 million in the same period of the previous year (+3.7%). Export sales amounted to Euro 62.8 million (Euro 62 million in the first half of 2015; +1.3%), comprising 37.7% of revenues (38.6% in H1 2015).
Consolidated EBITDA in the first six months of 2016 was Euro 38.6 million, compared to Euro 37.3 million in H1 2015 (+3.6%). The EBITDA margin was 23.2% (23.2% also in H1 2015).
Consolidated EBIT in H1 2016 totalled Euro 21.2 million (compared to Euro 20.3 million in the first half of 2015, +4.3%), with a margin of 12.7%.
Consolidated operating profit was Euro 21.7 million, compared to Euro 21.3 million in H1 2015 (+2%) – a margin of 13% (13.2% in H1 2015).
The consolidated Net Profit in H1 2016 amounted to Euro 12.6 million, compared to Euro 13.2 million in H1 2015 (-4.3%) – a margin of 7.6% (8.2% in H1 2015).
Balance sheet and financial position
Group capital expenditure in the first half of 2016 amounted to Euro 20.9 million (Euro 29.8 million in H1 2015). Payments on fixed assets totalled Euro 20.9 million in H1 2016, compared to Euro 31.5 million in H1 2015.
The Group generated Free cash flow in H1 2016, before payments on fixed assets, of Euro 25.9 million (Euro 25.2 million in the first half of 2015; +2.8%). After payments on fixed assets, free cash flow of Euro 5 million was generated, compared to an absorption of Euro 4.6 million in H1 2015.
The Group net financial debt at June 30, 2016 was Euro 144.2 million, compared to Euro 129 million at December 31, 2015 (Euro 129.6 million at June 30, 2015). Group liquidity totalled Euro 79.2 million at June 30, 2016, compared to Euro 103.5 million at the end of 2015 and Euro 103.9 million at June 30, 2015. The decrease relates to capital expenditure carried out and ongoing. The funding operations carried out principally in the previous year – in support of the investment programme which will continue in 2016 – confirm the full availability of the lending institutions to finance Zignago Vetro Group industrial initiatives.
Based on the information available, demand in the sectors in which the Group operates is overall expected to remain at a good level, resulting in increased sales and margins.