Fnac Darty: 2024 Half-Year Results
HALF-YEAR RESULTS 2024
Ivry-sur-Seine – France, July 24, 2024, 5:45 p.m. CET
Q2 2024: return to growth in all
geographies
H1 2024 results in line with expectations, stable vs H1
2023
Envisaged acquisition of Unieuro, Italian leader in
Consumer electronics and Domestic appliances
2024 annual outlook confirmed
FINANCIAL PERFORMANCE
- Q2 2024 revenue of €1.6
billion, up +2.1% on a reported basis and up +0.8% on a
like-for-like basis1
- H1 2024 revenue of €3.4
billion, up +1.4% on a reported basis and up +0.1% on a
like-for-like basis1
- Gross margin rate at 31%,
up +10 bps excluding dilutive
impacts2
- Current operating income
stable compared with the first half of 2023, reflecting
tight control of the gross margin and costs
ENVISAGED ACQUISITION OF UNIEURO:
CONSOLIDATION OF EUROPEAN LEADERSHIP OF SPECIALIZED RETAIL IN
EUROPE3
- A #1 position in Italy that
consolidates the group's presence in Western and Southern
Europe
- A mixed
public tender offer4
to be jointly filed by Fnac Darty and Ruby Equity
Investment5
- Offer
description: €9.0 in cash and 0.10 in Fnac Darty shares, valuing
Unieuro at €12.0 per
share6
- Creation of a Group with
over €10 billion in revenue and nearly 30,000
employees7
-
Projected synergies of over €20
million8, mostly from
improving buying terms
- EPS accretion above 10%
from 2025, including synergies
- Closing expected in Q4
2024
RECOGNITION OF THE GROUP'S CSR
COMMITMENTS: MOODY'S ESG RATING UP 4 POINTS TO 65/100, RANKED #2 OF
THE SPECIALIZED RETAIL SECTOR
2024 ANNUAL OUTLOOK
CONFIRMED
Enrique Martinez, Chief Executive Officer of Fnac Darty,
stated:
“In an economic and geopolitical context that remains
uncertain, we remain mobilized to achieve our objectives and
confirm our annual outlook. Indeed, our Group has shown solid
resilience over the first half of the year, despite a lacklustre
environment for the retail sector. This performance was made
possible by high-quality operational execution and the commitment
of our teams to strict cost control. We also posted a solid gross
margin, supported by the relevance of our service-oriented business
model.
We are delighted to have announced last week
our plan to acquire Unieuro, the leading Italian distributor of
Consumer electronic products and Domestic appliances, an operation
which would enable us to play a key role in the consolidation of
the European retail market.
On the eve opening of the Paris Olympic and
Paralympic Games, we are excited to see the culmination of our
commitment as a partner to this great celebration of sport and its
values.”
H1 2024 KEY FIGURES
|
Period ended June 30 |
|
(€ million) |
2023 |
2024 |
Change |
|
Revenue |
3,344 |
3,390 |
+1.4% |
|
Change on like-for-like basis9 |
|
|
+0.1% |
|
Gross margin |
1,039 |
1,050 |
11 |
|
As a % of revenue |
31.1% |
31.0% |
(10) bps |
|
Current EBITDA10 |
143 |
146 |
3 |
|
Current operating income |
(35) |
(36) |
(1) |
|
As a % of revenue |
(1.1)% |
(1.1)% |
|
|
Net income from continuing operations, Group
share |
(163) |
(75) |
88 |
|
Net income from discontinued operations, Group share |
29 |
2 |
|
|
Free cash-flow from operations, excluding IFRS
16 |
(660) |
(673) |
(13) |
|
In Q2 2024, Group revenue
amounted to €1,596 million, up +2.1% on a reported basis and +0.8%
on a like-for-like basis1 from the previous year.
In H1 2024, Group revenue
amounted €3,390 million, up +1.4% on a reported basis and +0.1% on
a like-for-like basis1 from the first half of 2023.
In the first half of the year, Group performance
is historically affected by the seasonal nature of the business,
for which the main part of the earnings and of the free cash-flow
from operations is recorded during the second half of the year.
The market, although still depressed, showed the
first signs of recovery in the 2nd quarter. Against this
backdrop, Fnac Darty is once again demonstrating its ability to
outperform, thanks to its strategic decisions and resilience,
reflected in its tightly controlled margins. The Group thus
returned to growth in the 2nd quarter, in all the
geographical areas in which it operates.
In the first half-year, the gross margin
rate was 31.0%. Excluding the dilutive impact of the
franchise and changes in scope, it was up +10 basis points compared
with the first half of 2023, driven by services, offsetting the
adverse effects of the channel/product mix.
Operating expenses amounted to
€1,086 million. Excluding the impact of MediaMarkt Portugal
integration, they have slightly decreased compared to the first
half of 2023. The embedded effect of rising rents, the full-year
effect of the mandatory annual negotiation (Négociation
Annuelle Obligatoire – NAO) and the inflation observed on
other cost items have been offset by the decrease in energy costs
and the efficiency of performance plans implemented across all the
Group's divisions.
Current EBITDA amounted to €146
million (including €125 million related to the application of IFRS
16), stable compared with the first half of 2023.
Current operating income was
-€36 million in the first half of 2024, stable compared with the
first half of 2023, and a very slight improvement excluding the
integration of MediaMarkt Portugal and the launch of Weavenn.
Changes by distribution
channel
Over the first half of the year, in-store revenue increased, again
demonstrating the attractiveness of the points of sale. Online
business represented 21% of the Group’s sales, stable compared with
2023. Lastly, omnichannel sales remained one of the Group’s
strengths. Click & Collect is up to 51% (+1.9 points vs. H1
2023).
Changes by product
category
Consumer electronics returned to growth in the
first half, thanks to a particularly strong 2nd quarter.
The television business recorded very good results, driven by the
European Football Championship and customer appetite for larger
screens and advanced technologies (OLED). Telephony also registered
growth, driven by the attractiveness of new products incorporating
artificial intelligence. Computers again posted growth in the
second quarter, boosted by the beginnings of the re-equipment
cycle. These two categories are expected to fully benefit from the
launch of innovations from the second half-year. Editorial
products decreased, affected, as expected, by a very high
basis of comparison for gaming, which had benefited from a very
dense line-up in 2023. Books recorded a solid performance, mainly
due to the attraction of new reading trends.
Services continued to grow in all regions.
Diversification also performed strongly, thanks to
double-digit growth in toys and games, and in stationery. Lastly,
appliances were almost stable, driven by the
positive performance of small domestic appliances, while sales of
large appliances were down again, still affected by the low point
of the real estate market.
Changes by
region
Sales in France and Switzerland
returned to growth on a like-for-life basis11 (+0.7% in
the 2nd quarter and +0.1% in the first half of the
year). The scope effect mainly reflects the effect of the closure
of the last three Manor shop-in-shops in non-French speaking
Switzerland.
In the Iberian Peninsula, sales
returned to positive territory in the 2nd quarter (+2.2%
on a like-for-like basis1), pointing to an almost stable
first half-year (-0.4% on a like-for-like basis1). In
Spain, the return to growth seen since March continued. Portugal
benefited from the activity of the 10 MediaMarkt stores that have
been consolidated since October 1, 2023.
Business in the Belgium and
Luxembourg area grew slightly (on a like-for-like
basis1: +1.0% in the 2nd quarter and +0.4% in
the first half-year). Sales were boosted by marked growth in
services.
Other income statement items
Non-current items came in at
-€27 million for the half-year, mainly comprising
restructuring-related expenses for c.€11 million of which half
concern Nature et Découvertes and the fair value adjustments of
various IT projects for c. €15 million. Operating income was
therefore a loss of -€63 million over the half-year.
Net financial income was -€37
million, compared with -€44 million in the first half of 2023. The
change comes on one side from the increase in cost of net debt (€3
million) and on the other side from the increase in IFRS 16
expenses (€7 million) because of interest rate increase. The
remaining comes from a capital loss on the disposal of the Daphni
fund accounted in H1 2023.
After considering tax income of €27 million, net
income from continuing operations, Group share for the
first half of 2024 was down to -€75 million.
Financial structure
In the first half of 2024, free
cash-flow from operations, excluding IFRS 16, amounted to
-€673 million, compared with -€660 million in the first half of
2023. The change mainly reflected the integration of MediaMarkt’s
business in Portugal. Net operating investments was +€38 million,
due to asset disposals, notably a logistics warehouse.
The Group’s net financial debt
excluding IFRS 16 totaled €496 million on June 30, 2024.
The change in net financial debt between December 31 and June 30
was due to the seasonal nature of business, with net debt on
December 31 being structurally lower due to the high volume of
business recorded at the end of the year.
The Group recorded a net cash
position of €583 million on June 30, 2024. In addition,
the Group benefits from undrawn revolving credit facility and
Delayed Drawn Term Loan (DDTL) of €600 million, maturing in March
2028 (with two options to extend, in March 2029 and March
2030).
This strong liquidity position supports the
Group’s confidence in strategically allocating its resources in the
most opportune way (M&A, debt reduction, shareholder return,
etc.) while remaining attentive to its leverage ratio.
Furthermore, the Group is rated by the rating
agencies Standard & Poor’s, Scope Ratings and Moody’s, which
assigned ratings of BB+, BBB and BB+ respectively during 2023, with
a negative outlook (S&P and Scope) or a stable outlook (Fitch).
In July, following the announcement of the Unieuro acquisition
project, Fitch and S&P have confirmed their ratings.
For the fourth consecutive year, Fnac Darty paid
a dividend of €0.45 per share. This amount
represents a 39% payout ratio, calculated on the net income from
continuing operations, Group share – adjusted12. This is
in line with previous years and with the shareholder return policy
presented in the strategic plan Everyday. The dividend was paid on
July 5, 2024, totaling €12.5 million.
CONTINUED ROLL-OUT OF THE STRATEGIC
PLAN
The resilience of the 2024 half-year results continues to
demonstrate the power and singularity of the Group’s omnichannel
model, with the ambition of being, on a daily basis and
over the long term, the consumer's ally, helping them to be
sustainable in their consumption habits and daily household
tasks. Fnac Darty pursued its strategic roadmap throughout
the half-year.
Weavenn, the joint venture
created by Fnac Darty and CEVA Logistics, began
operating during the second quarter. The joint venture is expected
to generate revenue of €200 million and a double-digit operating
margin within five years.
Fnac Darty has obtained ISO 50001
certification, an international symbol of excellence in
energy management. This certification was mainly made possible by
the investments in LED lighting and the energy management tools
(building management system or BMS) rolled out in all integrated
stores in 2023.
Fnac Darty is rated 65/100 by V.E.
Moody’s Analytics, which is an increase of 4 points from
2022, ranking the Group as second in the specialized retail sector.
This performance once again highlights the environmental, social
and governance commitments of Fnac Darty, as pillars of the
strategic plan Everyday.
Lastly, the finalization date for the
disposal of the ticketing business to the CTS
Eventim group remains uncertain, as the required regulatory
approvals from the European and Swiss competition authorities have
not yet been obtained.
RECENT EVENT
The envisaged acquisition of Unieuro13 would create a
market leader in Consumer electronics, Domestic appliances,
Editorial products and Services in Southern and Western Europe,
with over €10 billion in revenue, 30,000 employees and more than
1,500 stores. The combined entity would hold #1 or #2 positions in
its main markets.
The combination offers a potential for
operational run-rate synergies projected at over €20 million before
taxes, primarily from improved buying terms and the integration of
private label activity. Unieuro would also benefit from Fnac
Darty‘s expertise in terms of operational efficiency. Further
synergies will be explored post transaction.
The Group anticipates an accretive impact on its
Earnings Per Share above 10% from 2025, including
run-rate synergies, as well as a positive impact on its current
operating income and free cash flow from operations.
The public offer would include for each Unieuro
share:
- €9.0 in cash; and
- 0.10 Fnac Darty newly issued
shares14.
This offer values Unieuro at €12.0 per
share2, representing a premium of 42% based on the spot
volume weighted average closing price as of July 15, 2024, and a
34% premium on the volume-weighted average closing price over the
last 3 months. This implies an equity value15 for
Unieuro of c.€249 million, of which Fnac Darty already owns 4.4% of
Unieuro’s share capital.
The offer would allow Unieuro’s shareholders to
cash in their stake and to become shareholders of the
combined entity, with an opportunity to benefit from value creation
potential.
The Offer would be financed as follows:
- Fnac Darty and Ruby Equity
Investment16 plan to create a joint investment vehicle
(held respectively at 51% and 49%) that will hold the stake in
Unieuro. This company would be controlled and consolidated by Fnac
Darty Group.
- The cash component representing
c.75% of the offer amount, would be financed by Ruby Equity
Investment and Fnac Darty in the respective proportion of c.2/3 and
c.1/3.
- The equity component representing
c.25% of the offer amount would be financed by Fnac Darty through a
share issuance of approximately 2.0 million shares17,
within the limits of the current authorizations, and representing
around 6.6% of Fnac Darty’s share capital post transaction.
- The Group’s net debt increase would
be limited to around +€56 million18, allowing Fnac Darty
to protect its financial flexibility and pursue its capital
allocation policy.
The launch of the Public Tender should occur
after customary conditions related to Italian regulatory approvals
have been met. This transaction will be subject to review by the
relevant competition authorities.
Completion of the transaction is expected for the 4th quarter of
2024.
2024 OUTLOOK
Despite initial positive signs, market recovery
remains uncertain. The strength of the Everyday strategic plan, a
key factor in the Group's resilience, and the ramp-up of new
innovations should support the major sales events at the end of the
year, which remain crucial to full-year earnings.
The Group is therefore continuing to have a
cautious view of the economic and geopolitical context, and at this
stage it is on track for a Current Operating Income (COI)
for 2024 at least equal to that of 2023.
The Group reaffirms its objective of achieving a
cumulative free cash-flow from
operations19 of
approximately €500 million over the period 2021-2024
(i.e. €180 million in 2024).
*********
PRESENTATION OF THE 2024 HALF-YEAR
RESULTS
Enrique Martinez, Chief Executive
Officer, and Jean-Brieuc Le Tinier, Group Chief Financial
Officer, will host a virtual presentation of the results
in French, with simultaneous interpretation into English, on
Wednesday July 24, 2024 at 6:00 p.m. (CET); 5:00
p.m. (UK); 12:00 p.m. (East Coast USA).
To access the conference call, please
dial-in:
France: +33 1 70 91 87 04
UK Dial-in +44 1 212 81 80 04
USA Dial-in +1 718 705 87 96
The webcast will be available at this link.
You can listen to a recording of the presentation at any time,
in either French or English, via www.fnacdarty.com.
Fnac Darty will today also publish its French
half-year report on its website, under “Investors” section. It will
also be available on the Group’s website and on the AMF
website.
CONTACTS
ANALYSTS/INVESTORS
Domitille Vielle – Head of Investor Relations –
domitille.vielle@fnacdarty.com – +33 (0)6 03 86 05 02
Laura Parisot – Investor Relations Manager –
laura.parisot@fnacdarty.com – +33 (0)6 64 74 27 18
PRESS
Audrey Bouchard – Head of Media Relations and Reputation –
audrey.bouchard@fnacdarty.com – +33 (0)6 17 25 03 77
APPENDIX
The half-year financial statements approved by
the Board of Directors on July 24, 2024 have been subject to a
limited audit conducted by the statutory auditors.
The following tables contain individually
rounded data. The arithmetical calculations based on rounded data
may present some differences with the aggregates or subtotals
reported.
REVENUE BY OPERATING SEGMENT
|
|
|
|
|
|
(€
million) |
Q2 2024
|
Change compared with Q2 2023 |
|
|
Reported |
At comparable scope and at constant exchange rates |
Like-for-like basis –
LFL (20) |
|
France and
Switzerland |
1,305.2 |
+0.4% |
+0.4% |
+0.7% |
|
Iberian
Peninsula |
164.7 |
+19.9% |
+19.9% |
+2.2% |
|
Belgium and
Luxembourg |
126.5 |
+0.5% |
+0.5% |
+1.0% |
|
Group |
1,596.4 |
+2.1% |
+2.1% |
+0.8% |
|
|
|
|
|
|
|
(€ million) |
H1 2024
|
Change compared with H1 2023 |
|
|
Reported |
At comparable scope and at constant exchange rates |
Like-for-like basis – LFL1 |
|
France and
Switzerland |
2,760.7 |
-0.2% |
-0.3% |
+0.1% |
|
Iberian
Peninsula |
343.6 |
+17.6% |
+17.6% |
-0.4% |
|
Belgium and
Luxembourg |
285.4 |
-0.1% |
-0.1% |
+0.4% |
|
Group |
3,389.7 |
+1.4% |
+1.3% |
+0.1% |
|
CURRENT OPERATING INCOME BY OPERATING
SEGMENT
|
|
|
|
|
|
(€ million) |
H1 2023 |
As a % of revenue |
H1 2024 |
As a % of revenue |
|
France and
Switzerland |
(27.7) |
(1.0)% |
(28.0) |
(1.0)% |
|
Iberian
Peninsula |
(6.8) |
(2.3)% |
(5.1) |
(1.5)% |
|
Belgium and
Luxembourg |
(1.0) |
(0.4)% |
(3.0) |
(1.0)% |
|
Group |
(35.5) |
(1.1)% |
(36.1) |
(1.1)% |
|
SUMMARY INCOME STATEMENT
|
Period ended June 30 |
|
|
|
(€ million) |
2023 |
2024 |
Change |
|
|
|
|
|
|
Revenue |
3,344 |
3,390 |
+1.4% |
|
Gross margin |
1,039 |
1,050 |
+1.1% |
|
As a % of revenue |
31.1% |
31.0% |
(0.1) bps |
|
Total costs |
(1,075) |
(1,086) |
+1.0% |
|
As a % of revenue |
32.1% |
32.0% |
(0.1) bps |
|
Current operating income |
(35) |
(36) |
(1) |
|
Products and non-current operating income and expense |
(100) |
(27) |
|
|
Operating income |
(136) |
(63) |
+73 |
|
Net financial expense |
(44) |
(37) |
|
|
Income tax |
19 |
27 |
|
|
Net income from continuing operations for the
period |
(161) |
(72) |
|
|
Net income from continuing operations for the period, Group
share |
(163) |
(75) |
+88 |
|
Net income from discontinued operations |
29 |
2 |
|
|
Consolidated net income, Group share |
(134) |
(73) |
|
|
|
|
|
|
|
Current EBITDA21 |
143 |
146 |
+3 |
|
As a % of revenue |
4.3% |
4.3% |
|
|
Current EBITDA excluding IFRS 16 |
14 |
21 |
+7 |
|
FREE CASH-FLOW FROM OPERATIONS
|
Period ended June 30 |
|
(€ million) |
2023 |
2024 |
|
|
|
|
|
|
|
Cash flow before tax, dividends and interest |
131 |
140 |
|
|
IFRS 16 impact |
(129) |
(140) |
|
|
Cash flow before tax, dividends and interest, excluding
IFRS 16 |
2 |
0 |
|
|
Change in working capital requirement, excluding IFRS 16 |
(635) |
(696) |
|
|
Income tax paid |
36 |
(15) |
|
|
Net cash flows from operating activities, excluding
IFRS 16 |
(597) |
(711) |
|
|
Net cash flows from operating investing
activities |
(63) |
38 |
|
|
Free cash-flow from operations, excluding
IFRS 16 |
(660) |
(673) |
|
|
BALANCE SHEET
|
|
|
|
Assets (€ million) |
December 31, 2023 |
June 30, 2024 |
|
Goodwill |
1,680 |
1,680 |
|
Intangible assets |
566 |
560 |
|
Property, plant and equipment |
544 |
465 |
|
Rights of use relating to lease agreements |
1,105 |
1,125 |
|
Investments in associates |
1 |
1 |
|
Non-current financial assets |
22 |
26 |
|
Deferred tax assets |
63 |
65 |
|
Other non-current assets |
0 |
0 |
|
Non-current assets |
3,981 |
3,922 |
|
Inventories |
1,158 |
1,158 |
|
Trade receivables |
189 |
121 |
|
Tax receivables due |
8 |
44 |
|
Other current financial assets |
22 |
24 |
|
Other current assets |
536 |
390 |
|
Cash and cash equivalents |
1,121 |
583 |
|
Current assets |
3,034 |
2,319 |
|
Assets held for sale |
0 |
0 |
|
Total assets |
7,015 |
6,242 |
|
|
|
|
|
|
|
|
|
Liabilities
(€ million) |
December 31, 2023 |
June 30, 2024 |
|
Share capital |
28 |
28 |
|
Equity-related reserves |
987 |
987 |
|
Translation reserves |
(6) |
(6) |
|
Other reserves |
513 |
434 |
|
Shareholders’ equity, Group share |
1,522 |
1,442 |
|
Shareholders’ equity – Share attributable to non-controlling
interests |
17 |
16 |
|
Shareholders’ equity |
1,539 |
1,459 |
|
Long-term borrowings and financial debt |
604 |
806 |
|
Long-term leasing debt |
898 |
941 |
|
Provisions for pensions and other equivalent benefits |
167 |
164 |
|
Other non-current liabilities |
9 |
7 |
|
Deferred tax liabilities |
199 |
165 |
|
Non-current liabilities |
1,876 |
2,083 |
|
Short-term borrowings and financial debt |
319 |
272 |
|
Short-term leasing debt |
246 |
243 |
|
Other current financial liabilities |
9 |
14 |
|
Trade payables |
2,153 |
1,444 |
|
Provisions |
115 |
113 |
|
Tax payables due |
1 |
0 |
|
Other current liabilities |
758 |
615 |
|
Current liabilities |
3,600 |
2,701 |
|
Payables relating to assets held for sale |
0 |
0 |
|
Total liabilities |
7,015 |
6,242 |
|
STORE NETWORK
|
Dec. 31, 2023 |
Opening |
Closure |
June 30, 2024 |
|
France and Switzerland* |
838 |
11 |
9 |
840 |
|
Traditional Fnac |
96 |
0 |
0 |
96 |
|
Suburban Fnac |
17 |
0 |
0 |
17 |
|
Travel Fnac |
37 |
4 |
1 |
40 |
|
Proximity Fnac |
82 |
1 |
0 |
83 |
|
Connect Fnac |
7 |
0 |
1 |
6 |
|
Darty |
492 |
5 |
6 |
491 |
|
Fnac/Darty France |
1 |
0 |
0 |
1 |
|
Nature & Découvertes** |
106 |
1 |
1 |
106 |
|
Of which
franchised stores |
431 |
10 |
7 |
434 |
|
|
|
|
|
|
|
Iberian Peninsula |
88 |
0 |
3 |
85 |
|
Traditional Fnac |
53 |
0 |
1 |
52 |
|
Travel Fnac |
4 |
0 |
1 |
3 |
|
Proximity Fnac |
18 |
0 |
0 |
18 |
|
Connect Fnac |
3 |
0 |
1 |
2 |
|
MediaMarkt Portugal |
10 |
0 |
0 |
10 |
|
Of which
franchised stores |
6 |
0 |
1 |
5 |
|
|
|
|
|
|
|
Belgium and Luxembourg |
84 |
2 |
2 |
84 |
|
Traditional Fnac*** |
12 |
2 |
1 |
13 |
|
Proximity Fnac |
1 |
0 |
0 |
1 |
|
Darty (Vanden Borre) |
71 |
0 |
1 |
70 |
|
|
|
|
|
|
|
Fnac Darty Group |
1,010 |
13 |
14 |
1,009 |
|
Traditional Fnac |
161 |
2 |
2 |
161 |
|
Suburban Fnac |
17 |
0 |
0 |
17 |
|
Travel Fnac |
41 |
4 |
2 |
43 |
|
Proximity Fnac |
101 |
1 |
0 |
102 |
|
Connect Fnac |
10 |
0 |
2 |
8 |
|
Darty/Vanden Borre |
563 |
5 |
7 |
561 |
|
Fnac/Darty |
1 |
0 |
0 |
1 |
|
MediaMarkt |
10 |
0 |
0 |
10 |
|
Nature & Découvertes |
106 |
1 |
1 |
106 |
|
Of which
franchised stores |
437 |
10 |
8 |
439 |
|
* Including 13 Fnac stores abroad: 3 in Qatar, 3
in Tunisia, 2 in Senegal, 2 in Ivory Coast, 1 in Congo, 1 in
Cameroon, 1 in Saudi Arabia and 3 Darty stores abroad in Tunisia;
and including 18 stores in the French overseas territories.
Excluding 14 Fnac shop-in-shops opened in Manor stores.
** including Nature & Découvertes subsidiaries managed from
France: 4 stores in Belgium, 1 store in Luxembourg, 7 franchises in
Switzerland, 1 franchise in Portugal and 5 franchises in the French
overseas territories.
*** Including one store in Luxembourg, which is managed from
Belgium.
DEFINITIONS OF ALTERNATIVE PERFORMANCE
INDICATORS
Indicator title |
Indicator definition |
Other non-current operating income and
expenses |
“Other non-current operating income and expense” reflects the
unusual and material items for the consolidated entity that could
disrupt tracking of the Group’s economic performance and that are
excluded from the current operating income:
- restructuring
costs and costs relating to staff adjustment measures.
- impairment on
capitalized assets identified primarily in the context of
impairment tests on cash-generating units (CGU) and goodwill.
- gains or
losses linked to changes in the scope of consolidation (acquisition
or disposal); and
- major
disputes that do not arise from the Group’s operating
activities.
|
Current EBITDA |
Current operating income before depreciation, amortization and
provisions on fixed operating assets that are recognized as
recurring operating income.
Current EBITDA is not an indicator stipulated by IFRS and does not
appear in the Group consolidated financial statements. Current
EBITDA has no standard definition and, therefore, the definition
used by the Group may not match the definition of this term used by
other companies. The application of IFRS 16 significantly changes
the Group’s current EBITDA.
Current EBITDA excluding IFRS 16 is used in the context of the
applicable financial covenants under the Loan Agreement. |
Current EBITDA excl. IFRS 16 |
Current EBITDA including rental expenses within the scope of IFRS
16, used in connection with the financial covenants applicable
under the Loan Agreement. |
Free cash-flow from operations |
This financial indicator measures the net cash flows linked to
operating activities and the net cash flows from operational
investments (defined as acquisitions and disposals of property,
plant and equipment and intangible assets, and the change in trade
payables for non- current assets). The application of IFRS 16
significantly changes the Group’s free cash-flow from
operations. |
Free cash-flow from operations, excl. IFRS 16 |
Free cash flow from operations including impacts relating to rents
within the scope of IFRS 16 |
Revenue |
The Group’s “real” revenue (or income from ordinary activities)
corresponds to its reported revenue. The Group uses the notions of
change in revenue detailed below. |
Net financial income excl. IFRS 16 |
Financial result minus financial interest on leasing debt
|
Net financial debt |
Net financial debt consists of gross debt including accrued
interest not yet due as defined by the French National Accounting
Council’s recommendation No. 2013-03 on November 7, 2013, minus
gross cash and cash equivalents. The application of IFRS 16
significantly changes the Group’s net financial debt. |
Net financial debt excl. IFRS 16 |
Net financial debt less leasing debt
|
Operating income |
The total operating income of Fnac Darty includes all the income
and costs directly related to Group operations, whether the income
and expense are recurrent or whether they result from one-off
operations or decisions. |
Current Operating Income |
Fnac Darty uses current operating income as the main management
balance. This is defi ned as the difference between the total
operating income and the “Other non-current operating income and
expense.” Current operating income is an intermediate line item
intended to facilitate the understanding of the entity’s operating
performance and that can be used as a way to estimate recurring
performance. This indicator is presented in a manner that is
consistent and stable over the long term in order to ensure the
continuity and relevance of financial information. |
Net cash |
Net cash consists of gross cash and cash equivalents, minus gross
debt including accrued interest not yet due as defined by the
French National Accounting Council’s recommendation No. 2013-03 on
November 7, 2013. The application of IFRS 16 significantly changes
the Group’s net cash. |
Net cash excl. IFRS 16 |
Net cash excluding leasing debt |
Change in revenue at a constant exchange rate
|
Change in revenue at a constant exchange rate means that the impact
of changes in exchange rates has been excluded. The exchange rate
impact is eliminated by recalculating sales for period N-1 using
the exchange rates used for period N. |
Change in revenue at a comparable scope of
consolidation |
Change in revenue at a comparable scope of consolidation means that
the impact of changes in the scope of consolidation is corrected so
as to exclude the modifications (acquisition, disposal of
subsidiary). Revenue of subsidiaries acquired or sold since
January 1 of period N-1 are, therefore, excluded when
calculating the change (in the event of a significant variation at
Group level).
|
Change in revenue on a same-store basis |
The change in revenue on a same-store basis means that the impact
of directly owned store openings and closures is excluded. Revenue
from stores opened or closed since January 1 of period N-1 is,
therefore, excluded when calculating said change. |
THE APPLICATION OF THE IFRS 16 STANDARD
On January 13, 2016, the IASB published
IFRS 16 – Leases. IFRS 16 replaces the IAS 17
standard and its interpretations. This standard, which is mandatory
for annual periods beginning on or after January 1, 2019,
requires the recognition of an asset (the right of use) and a
liability (leasing debt) on the basis of discounted in-substance
fixed lease payments.
The Group has applied IFRS 16 since
January 1, 2019. In order to ensure the transition between
IAS 17 and IFRS 16, all lease and service agreements
falling within the scope of IFRS 16 have been analyzed.
To monitor its financial performance, the Group
publishes indicators that exclude the application of IFRS 16.
These indicators are current EBITDA excluding IFRS 16, free
cash-flow from operations excluding IFRS 16, and net financial
debt excluding IFRS 16.
Avec l’application de la norme IFRS 16 |
IFRS 16 adjustment |
Without application of IFRS 16 |
Current EBITDA |
Rent within the scope of IFRS 16
|
Current EBITDA excluding IFRS 16 |
Current operating income before net depreciation, amortization and
provisions on fixed operational assets recognized as current
operating income |
Current EBITDA including rental expenses within the scope of IFRS
16 |
Free cash-flow from operations |
Disbursement of rent within the scope of IFRS
16
|
Free cash-flow from operations
excluding IFRS 16 |
Net cash-flow from operating activities, less net operating
investments |
Free cash-flow from operations including cash impacts relating to
rent within the scope of application of IFRS 16 |
Net financial debt |
Leasing debt
|
Net financial debt
excluding IFRS 16 |
Gross financial debt less gross cash and cash equivalents |
Net financial debt excluding leasing debt |
Net financial income |
Financial interest on leasing debt |
Net financial income excluding financial interest on
leasing debt |
1 Like-for-like basis – LFL: excludes the effect of changes
in foreign exchange rates, changes in scope, and store openings and
closures
2 Dilutive impacts come from Franchise and MediaMarkt
integration
3 See Press release of July 16, 2024
4 Mixed Offer made of a cash branch for 75% and a share branch for
25%
5 Joint investment vehicle held at 51% by Fnac Darty and by 49% by
Ruby Equity Investment (an affiliate of Vesa Equity
Investment),
consolidated by Fnac Darty
6 Based on Fnac Darty closing share price of €30.20 as of July 15,
2024
7 Combination of public annual information made public by the 2
entities as of December 31, 2023 for Fnac Darty and as of February
28, 2024
for Unieuro
8 Run rate starting 2025
9 Like-for-like basis – LFL: excludes the
effect of changes in foreign exchange rates, changes in scope, and
store openings and closures.
10 Current EBITDA is defined as current operating income before net
depreciation, amortization and provisions on fixed operational
assets recognized as current operating income
11 Like-for-like basis – LFL: excludes the effect of changes
in foreign exchange rates, changes in scope, and store openings and
closures.
12 Corresponds to the current net income, Group share of continuing
operations and adjusted according to the provision relating to the
planned transaction with the French Competition Authority (€85
million) and brand impairments (€20 million)
13 See Press release of July 16, 2024
14 Corresponding to €3.02 based on latest Fnac Darty closing share
price of €30.20 as of July 15, 2024
15 Based on 20.7 million outstanding shares
16 An affiliate of VESA Equity investment
17 Based on Fnac Darty latest closing price of €30.20 as of July
15, 2024
18 Excluding transaction fees
19 Excluding IFRS 16.
20 Like-for-like basis – LFL: excludes the effect of
changes in foreign exchange rates, changes in scope, and store
openings and closures.
21 Current EBITDA: earnings (current operating
income) before interest, tax, depreciation, amortization, and
provisions on fixed operational assets.
- Fnac_Darty_PR_2024 H1_ENG_24 07 2024_FOR RELEASE
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