A 43% increase in sales and an increase in profitability after the insurance compensation of € 10 million for the fire incident in Romania, Frigoglass SA announced for the last quarter.
In detail, in the main data of the fourth quarter of 2021, the listed company states the following:
43 Sales increase by 43% compared to last year as a result of the continuous recovery of demand in both sectors as well as the low comparative base
-Record sales in the Glass sector with an increase, on a neutral exchange rate, 55% compared to last year and 65% compared to pre-pandemic levels in the fourth quarter of 2019, due to increased demand and price adjustments
▪ Reduction of the EBITDA margin as a result of increased raw material and transport costs, the less favorable energy mix in Nigeria and the devaluation of the Nair, offsetting the benefits of increased sales volume and prices
▪ Enhancement of profitability after the insurance compensation of € 10 million for the fire incident in Romania, with an equal cash inflow in February 2022
▪ Charge of Free Cash Flows from the accumulation of stock in Russia and Romania in order to cover the continuing growth of demand in the first quarter of 2022
▪ The reopening of the plant in Romania is expected in early 2023. We focus on issuing the required permits
Νωση Deterioration of supply chain challenges as a result of the Russia-Ukraine conflict in late February, affecting our activities in Russia
Rig Frigoglass closely monitors the Russia-Ukraine conflict and the ever-evolving sanctions and takes steps, as far as possible, to limit the impact on its Russian subsidiary
“Despite the limitations in the production of the Professional Refrigeration sector and the high costs in the second half of the year, we achieved double-digit sales growth and strengthening of the EBITDA margin in 2021”, commented the CEO of Frigoglass, Nikos Mamoulis and added: “Although we are optimistic “Continuing positive demand trends in early 2022, we expect the recent conflict between Russia and Ukraine and the ever-evolving sanctions to affect our performance this year.”
Overview of Results
As expected, sales recovery continued in the fourth quarter in both sectors. After the successive improvement of the consumption of beverages and soft drinks during the year, as a result of the lifting of the restrictive measures in the channels of direct consumption and the low comparative base, our customers increased their investments in professional refrigerators. The successful launch of new products earlier in the year, which aim to support our customers in Europe in the post-pandemic period, combined with the increase in market shares in Africa and Asia, mainly due to the successful implementation of our customer-centric marketing strategy, boosted sales volumes in the quarter. As a result, sales in the Commercial Refrigeration sector recorded an increase to the low of 40% as well as a significant recovery approaching the pre-pandemic levels of 2019. The continuing increase in sales volume in the Glass sector, combined with price increase initiatives, led in record sales in the quarter. Overall, sales amounted to € 91.0 million, an increase of 43.3% compared to last year and a middle single-digit decline compared to the fourth quarter of 2019. Gross profit (excluding depreciation) amounted to € 15, 5 million remaining at about the same level compared to the fourth quarter last year. Gross profit margin fell to 17.0% from 24.2% in the fourth quarter of 2020, mainly reflecting the less favorable energy mix due to Nigeria gas outages, the Nair devaluation and rising raw material costs, and transport. These factors more than offset the benefits of increased sales volume and price adjustments.
Operating expenses (excluding depreciation) increased by 7.3% to € 9.8 million. Operating expenses as a percentage of sales improved by approximately 360 basis points to 10.7%, as a result of the increase in sales compared to last year.
Therefore, Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) increased by 12.3% to € 7.3 million, with the corresponding margin decreasing by 220 basis points to 8.0%. Operating profit (EBIT) amounted to € 2.5 million, an increase of 34.8% compared to last year, which partly reflects impairment expenses in the fourth quarter of last year. Financial costs amounted to € 8.0 million compared to € 2.8 million last year, as a result of the highest foreign exchange gains in the fourth quarter of 2020 due to the significant devaluation of the Nigerian Niger and the recent appreciation of the South African Rand. The ongoing discussions with the insurance companies resulted in a compensation agreement of € 42.0 million for material damage caused by the fire incident at our factory in Romania in June 2021. Consequently, in December 2021 it was recognized in Balance Sheet insurance compensation of € 10.0 million, with an equal cash inflow in February 2022. The one-off compensation more than offset the costs associated with the write-off of € 0.5 million and the costs of € 1.3 million. related to the temporary closure of the production unit in Romania. Income tax expenses amounted to € 4.1 million compared to € 5.3 million in the fourth quarter of 2020. Net losses amounted to € 1.9 million, compared to € 8.8 million last year.
Adjusted free cash flows amounted to € 10.6 million in 2021, compared to € 18.0 million last year. Free cash flows were affected by rising trade receivables due to strong sales recovery in the fourth quarter as well as the accumulation of stocks to ensure the availability of raw materials in both industries and finished products in the Professional Refrigeration sector to meet demand. first quarter of 2022. Adjusted net debt amounted to € 256.8 million in 2021, compared to € 255.6 million in 2020, positively affected by the payment of insurance compensation of € 15.0 million. In December 2021, our cash and cash equivalents amounted to € 79.2 million, compared to € 70.2 million in 2020.
See the full announcement in the right column Related Files
Source: Capital
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