HIGHCO : Q4 2018 GROSS PROFIT
Paris, 23 January 2019 (6.00 p.m.)
2018: ANOTHER YEAR OF HEALTHY GROWTH FOR HIGHCO
(GROSS PROFIT UP 2.6% LFL)
Sixth consecutive year of growth with Digital representing a 53% share of total business
- Q4 20181 gross profit of €23.19 M, up 11.5% on a reported basis and 3.5% LFL2.
- FY 20181 gross profit of €87.57 M, up 6.5% on a reported basis and 2.6% LFL2.
- Further growth surge in digital businesses: Q4 up 12.2% LFL, FY 2018 up 9.2% LFL.
- Robust annual growth in France: Q4 up 0.3% LFL, FY 2018 up 4.4% LFL.
- Decline in Benelux despite a pick up in Q4: Q4 up 10.9% LFL, FY 2018 down 2.6% LFL.
Improved profitability for FY 2018 in line with guidance
- Rise in adjusted operating margin (adjusted headline PBIT/gross profit)3 of about 20 bp.
|Gross Profit (in € M)1||2018||2017 Reported||2017 LFL2|| 2018/2017 |
| 2018/2017 |
1 Data currently being audited.
2 Like for like: Based on a comparable scope (i.e. including Useradgents over six months in 2017 and 2018, as of 1 July) and at constant exchange rates (i.e. applying the average exchange rate over the period to data from the compared period).
3 Adjusted headline profit before interest and tax: Recurring operating income before restructuring costs and excluding the cost of performance share plans. Adjusted operating margin: Adjusted headline PBIT/Gross profit.
4 Net cash: Cash (asset) minus gross financial debt (liability).
Cécile Collina-Hue, Chairman of the Management Board, stated: "With a strong fourth quarter, still driven by Digital business, HighCo continued its growth trend for a sixth consecutive year, with gross profit up 2.6% like for like. Despite the current social climate and challenges raised by new regulations applicable to retail promotions - a measure taken following the French National Food Conference - we were able to draw on our complementary range of solutions and strengthened expertise in data marketing to lead our major customers through projects that will have a fundamental impact on their business. As such, HighCo has consolidated its position as a key market player and anticipates another year of growth."
FURTHER GROWTH SURGE IN DIGITAL BUSINESSES
Still driven by Digital, the Group posted strong business growth in Q4 2018, up 11.5% on a reported basis and 3.5% like for like to €23.19 M.
The Group's gross profit came to €87.57 M for FY 2018, up 6.5% on a reported basis and 2.6% like for like.
With business rising 12.2% like for like in Q4 2018, Digital posted a second consecutive quarter of double-digit growth (Q3 2018 up 13.4% like for like). The share of digital in total Group business continued to grow, up from the reported figure of 50.2% in Q4 2017 to 58.3% in Q4 2018. Offline businesses closed the fourth quarter down 6.7% on a like-for-like basis.
Digital businesses posted overall like-for-like growth of 9.2% in 2018, accounting for 52.9% of the Group's gross profit (47.8% on a reported basis in 2017). This strong growth is mainly due to the accelerated digitisation of Data businesses and the successful integration of Useradgents, an all-digital agency, in the second half of the year. Offline businesses showed a like-for-like decline of 3.8% over the year.
Revenue for FY 2018 came to €173.8 M.
ROBUST ANNUAL GROWTH IN FRANCE
France turned in gross profit of €16.93 M in Q4 2018, up 0.3% like for like, equal to 73% of the Group's gross profit. This growth should be considered in light of the significant business growth registered for the fourth quarter in previous years (4.1% like for like in Q4 2017; 11.3% like for like in Q4 2016).
Gross profit in France totalled €64.68 M for the full year 2018, up 4.4% like for like, driven by the positive performance of Drive to Store and sharp growth in Data businesses.
As for the Group as a whole, in France this growth is driven by the strong development of digital businesses, which grew 8.6% like for like, reaching a 67.2% share in the gross profit for the fourth quarter.
In 2018, digital businesses grew 9.2% like for like, and their share represented 59.8% of total business activity, while offline businesses fell 2.1% like for like over the year.
DECLINE IN BENELUX DESPITE A PICK UP IN Q4
International gross profit rose 13.4% on a like-for-like basis to €6.26 M in Q4 2018, i.e. 27% of the Group's gross profit, benefiting from a favourable comparative base (7.9% like-for-like decline in Q4 2017). In Benelux, gross profit increased 10.9% like for like in Q4 2018 to €5.93 M.
International gross profit stood at €22.9 M in 2018, down 1.9% like for like.
Despite a pick up in the fourth quarter, Benelux continued to decline overall, down 2.6% like for like, accounting for 24.9% of the Group's gross profit. The 7.3% growth in digital businesses over the year, representing 29.9% of gross profit for the region, did not offset the drop in the volume of paper coupons cleared and the decline in offline in-store media.
With a very strong performance in the second half of 2018, business in Southern Europe showed significant growth for FY 2018 (up 15.9% like for like), in both Spain and Italy. The region now accounts for 1.3% of the Group's gross profit.
IMPROVED PROFITABILITY FOR FY 2018 IN LINE WITH GUIDANCE
Based on the year-end closing in progress, HighCo confirms its 2018 guidance and expects a rise in adjusted operating margin3 of about 20 bp (2017 adjusted operating margin: 18.1%).
Estimated net cash4, including working capital resources from the Data businesses, totalled approximately €52 M at 31 December 2018 (€45.91 M at 31 December 2017).
The 2018 annual earnings will be released on 26 March after market close. A financial analysts' meeting is scheduled for Wednesday, 27 March at 2.30 p.m.
Since its creation, HighCo has placed innovation at the heart of its values, offering its clients - brands and retailers - Intelligent Marketing Solutions to influence shopper behaviour with the right deal, in the right place, at the right time and on the right channel.
Listed in compartment C of Euronext Paris, and eligible for the "long only" DSS, HighCo has more than 750 employees and since 2010 has been included in the Gaia Index, a selection of 70 responsible Small and Mid Caps.
Cécile Collina-Hue Cynthia Lerat
Chairman of the Management Board Press Relations
+33 1 77 75 65 06 +33 1 77 75 65 16
Publications take place after market close.
2018 Annual Earnings: Tuesday, 26 March 2019
SFAF financial analysts meeting: Wednesday, 27 March 2019 at 2:30 p.m. (8 rue de la Rochefoucauld - 75009 Paris)
Q1 2019 Gross Profit: Thursday, 18 April 2019
Q2 and H1 2019 Gross Profit: Wednesday, 17 July 2019
2019 Half-year Earnings: Wednesday, 28 August 2019
Conference call on 2019 half-year earnings: Thursday, 29 August 2019
Q3 and 9-month YTD 2019 Gross Profit: Wednesday, 16 October 2019
Q4 and FY 2019 Gross Profit: Wednesday, 22 January 2020
HighCo is a component stock of the indices CAC® Small (CACS), CAC® Mid&Small (CACMS) and CAC® All-Tradable (CACT).
Bloomberg: HCO FP
For further financial information and press releases, go to www.highco.com.