IFCO continues growth path in Q3 2010
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IFCO Systems N.V. /
IFCO continues growth path in Q3 2010
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Amsterdam, Netherlands, November 11, 2010
IFCO's currency adjusted group revenues and operational profitability (EBITDA)
both continued to grow in Q3 2010 and YTD 2010 as compared to Q3 2009 and YTD
2009. IFCO's currency adjusted group revenues grew by 12.0% to US $200.2 million
in Q3 2010 compared to Q3 2009 and in YTD 2010 by 9.6% to US $583.8 million.
Currency adjusted EBITDA increased by 8.6% to US $37.1 million in Q3 2010
compared to Q3 2009 and in YTD 2010 by 19.6% to US $105.0 million. EBITDA growth
rate and EBITDA margin development in Q3 2010 was negatively affected by items
that impacted SG&A, COS and other income development in Q3 2009 as described
below. Eliminating these effects, EBITDA in Q3 2010 would have improved by
15.8% and EBITDA margin from 17.9% in Q3 2009 to 18.5% in Q3 2010. LTM Q3 2010
currency adjusted EBITDA reached a record level of US $141.9 million in IFCO's
history.
RPC Management Services delivered significant gains in currency adjusted
revenues (Q3 2010 by 20.5%, YTD 2010 by 18.8%), gross profit (Q3 2010 by 39.5%,
YTD 2010 by 31.8%) and EBITDA (Q3 2010 by 12.1%, YTD 2010 by 21.1%) in Q3 2010
and YTD 2010 as compared to Q3 2009 and YTD 2009. In the Pallet Management
Services business segment revenues grew by 1.8% in Q3 2010 compared to Q3 2009
while gross profit decreased by 0.8% and EBITDA declined by 5.3% compared to Q3
2009. YTD 2010 gross profit grew by 9.2% and EBITDA by 13.9% of Pallet
Management Services business segment with stable revenues compared to YTD 2009.
RPC Management Services' currency adjusted revenues showed continuous growth in
recent quarters (Q1 2010 17.3%, Q2 2010 18.3% and Q3 2010 20.5%), resulting from
a combination of organic volume growth in our European RPC business as well as
strong and sustainable growth in our RPC US business. Our European business
benefited from higher usage and increased penetration of our current customer
base as well as winning new retailers in certain markets, like Spar in Austria
for previous quarters and Carrefour in France for future quarters. Also our
efforts to develop the business in East Europe showed good progress and
supported the overall positive volume development in Europe. We recently signed
an agreement with MERCATOR in Slovenia. Growth in our RPC US business has
accelerated even further due to increasing RPC penetration in our existing
customer base and a steady flow of new retailers adopting the RPC model. RPC
South America's growth momentum continued to develop.
Revenues in Pallet Management Services were nearly unchanged in recent quarters,
however grew slightly in Q3 2010 compared to Q3 2009 and came in close to
previous year levels for YTD 2010. Although the market pricing environment
remained below 2009 levels, the negative sequential trends flattened out, with
Q3 2010 average pallet pricing at the same average levels as Q1 and Q2 2010.
Year-over-year pallet sale volumes grew for the first time during 2010 in Q3, as
our efforts to recover volumes have been successful. Service related revenues
showed a good growth momentum and continued to increase as a percentage of total
revenues.
Gross profit margin on a group level increased in Q3 2010 by 2.5 percentage
points to 21.9% (YTD 2010, grew 2.5 percentage points to 21.8%). RPC Management
Services' gross profit margin grew from 23.8% in Q3 2009 to 27.9% in Q3 2010.
Gross profit margin in our European RPC business benefited from higher per trip
revenues because of changes in the mixture of rented RPCs, under proportional
growth of per unit cost of goods sold and relative lower depreciation. Gross
profit margin in the RPC US business decreased slightly as a result of
marginally lower prices, as well as higher freight costs resulting from higher
fuel prices, a higher rate of expedited RPC pool movements in order to meet the
increasing customer demand and general cost increases in the US truckload and
intermodal carrier market. All regions continue to benefit from the scale
effects of the growing business on fixed costs. Gross profit margin in the
Pallet Management Services business slightly decreased to 13.3% from 13.6% in Q3
2009. Gains related to the continued lower cost of pallet cores, greater direct
labor productivity, and improved fixed cost leverage were more than offset by
the effect of lower customer prices, higher common carrier spend to move
inventories between locations to meet customer demand, higher year-over-year
fuel prices, and lower margins in our Custom Crating division.
Currency adjusted group EBITDA increased in Q3 2010 by 8.6% to US $37.1 million
(YTD 2010, by 19.6% to US $105.0 million). EBITDA on a currency adjusted basis
in RPC Management Services increased in Q3 2010 by 12.1% to US $34.3 million
(YTD 2010, by 21.1% to US $92.3 million). RPC Management Services EBITDA margin
development in 2010 is continuing the positive trend (Q1 2010 26.5%, Q2
2010 28.8% and Q3 2010 29.1%). EBITDA in Pallet Management Services decreased by
5.3% to US $5.4 million in Q3 2010 (YTD 2010, by 13.9% to US $20.3 million).
EBITDA margin in Pallet Management Services grew in Q3 2010 to 6.5% from 7.0% in
Q3 2009.
EBITDA and EBITDA margin in Q3 2009 were positively affected by items that
impacted SG&A, COS and other income development in Q3 2009. Improved credit and
collection development in the prior year has resulted in reduced general
allowance for bad debt of US $1.6 million in Q3 2009. Additionally the Company
recorded the net effect of insurance reimbursement of US $0.8 million in Q3
2009. Eliminating these effects, EBITDA in Q3 2010 would have improved by 15.8%
and EBITDA margin from 17.9% in Q3 2009 to 18.5% in Q3 2010.
Currency adjusted EBIT increased by 10.4% to US $26.1 million in Q3 2010 (YTD
2010, by 26.8% to US $73.3 million). LTM Q3 2010 currency adjusted EBIT reached
a level of US $100.5 million.
Net profit significantly increased from US $7.6 million in Q3 2009 to US $11.1
million in Q3 2010 (YTD 2010 from US $4.9 million to US $18.1 million). The net
operational improvements and lower net interest costs were partially offset by a
higher deferred tax provision.
IFCO's cash flow from continuing operations, excluding the cash flow effect of
income tax payments and ICE related payments, significantly increased to US
$119.4 million in YTD 2010 from US $84.4 million in YTD 2009 as a result of
higher profit levels and improved working capital development. Working capital
especially improved through lower inventory levels and better accounts
receivable day sales outstanding.
Our capital expenditure levels increased by US $13.8 million, or 103.4%, to US
$27.2 million during Q3 2010 (YTD 2010, by 109.6% to US $80.0 million). The
realization of the planned growth in Europe and the US has led to continued
investments in our RPC pools in 2010.
ROCE from continuing operations, on a LTM basis, increased to 22.4% as of
September 30, 2010, compared to 19.0% as of year-end 2009 and compared to 17.5%
as of September 30, 2009. This positive development is the result of the
Company's increased profitability and continuous improved utilization of the RPC
pool leading to relative lower capex spending.
Our sources of liquidity currently include cash from operations, cash and cash
equivalents on hand, amounts available under our RCF and certain factoring
agreements. As of September 30, 2010, our liquidity declined to US $107.9
million compared to US $138.2 million as of December 31, 2009 and compared to US
$116.0 million (currency adjusted US $108.8 million) as of September 30, 2009.
Despite the growth driven higher capex in our RPC pools, ICE related payments,
the dividend payment made during Q2 2010 and the STECO vendor note payment, the
Company's currency adjusted liquidity has kept stable on prior year level, which
is the result of higher operational profitability and better working capital
management. We believe that these sources of liquidity are sufficient to finance
our future capital and operational requirements in accordance with our business
plans.
US $ in Q3 2010 Q3 2009 % Change YTD 2010 YTD % LTM Q3
thousands, ((1)) 2009 Change 2010
except per ((1))
share amounts
Revenues 200,197 186,634 7.3% 583,825 541,367 7.8% 778,384
Revenues 200,197 178,724 12.0% 583,825 532,540 9.6% 771,583
currency
adjusted
Gross profit 43,780 36,198 20.9% 127,292 104,610 21.7% 173,822
Gross profit 21.9% 19.4% 21.8% 19.3% 22.3%
margin
EBITDA 37,074 36,191 2.4% 104,979 90,262 16.3% 143,727
EBITDA 37,074 34,144 8.6% 104,979 87,807 19.6% 141,934
currency
adjusted
EBITDA margin 18.5% 19.4% 18.0% 16.7% 18.5%
EBIT 26,086 25,011 4.3% 73,328 59,570 23.1% 101,904
EBIT currency 26,086 23,624 10.4% 73,328 57,842 26.8% 100,526
adjusted
EBIT margin 13.0% 13.4% 12.6% 11.0% 13.1%
Net profit 11,066 7,618 45.3% 18,116 4,950 266.0% 33,120
Net profit per 0.22 0.14 49.3% 0.35 0.09 280.0% 0.65
share - basic
Net profit per 0.22 0.14 49.3% 0.35 0.09 277.5% 0.64
share -
diluted
Operating cash 54,868 51,359 6.8% 119,445 84,449 41.4% 170,338
flows from
continuing
operations
excl. ICE
Operating cash 52,944 50,264 5.3% 105,681 76,092 38.9% 154,147
flows from
continuing
operations
incl. ICE
Capital 27,163 13,356 103.4% 80,046 38,185 109.6% 99,936
expenditures
from
continuing
operations
Return on 22.4% 17.5%
capital
employed
(ROCE)
((1)) The Company has made changes according to IAS 8 leading to restated Q3
2009 and YTD 2009 Financial Statements. For more details we refer to our
quarterly report.
Outlook: As the financial crisis that unfolded in 2008 spread to the worldwide
economy up to today, IFCO experienced challenging economic climates in many of
its markets. While the economy in the United States remained in a weak but
slightly improved condition during Q2 2010, the European economy will recover
during 2010.
Accordingly, the European RPC Management Services business will continue to
leverage IFCO's leadership position and market experience to meet or exceed
overall market development. The Company plans to increase its sales initiatives
and to continue to expand its geographic presence in Western Europe, Central
Eastern Europe (CEE) and South America. Recent wins of new retailers, like
Carrefour in France, Spar in Austria and MERCATOR in Slovenia support IFCO's
expectations. In the United States, IFCO realized increases in the overall RPC
penetration among grocery food retailers and plans to grow in excess of this
market development. Based on the Company's solid RPC business model, IFCO
expects that the RPC Management Services businesses will continue to grow in
2010. IFCO's investments to support this growth will be carefully aligned with
its business development and are targeted to continually increase the return on
its invested capital.
IFCO's Pallet Management Services business has significantly been negatively
affected by the overall economic decline in the United States in 2009, primarily
as a result of pressure on prices from lower market demand. Nevertheless, IFCO
remains confident that the key competitive advantages of the Pallet Management
Services business - the breadth of service offerings, the national network and
the value proposition at a national and local level - have not changed and
should allow its Pallet Management Services segment to stabilize revenues and
increase profitability in 2010.
The Company believes that its current assessment of the markets and its business
development as described above should result in overall significant gains in
both revenues and operational profitability in 2010 as compared to 2009.
Financially, IFCO expects to be able to fund its capital, operational and debt
service requirements through its own operating cash flows.
For further explanations, please see IFCO's quarterly report, which will be
filed with the Deutsche Börse AG on or about November 11, 2010, and will be
available on the Company's website www.ifcosystems.com or www.ifcosystems.de.
The Company will hold a conference call on November 18, 2010. The details are
available on the Company's website.
This release contains forward-looking statements that reflect Management's
current view with respect to future events. All statements contained in this
release that are not clearly historical in nature or necessarily depend on
future events are forward-looking. The words "anticipate", "believe", "expect",
"estimate", "planned" and similar expressions are generally intended to identify
forward-looking statements. These statements are based on current expectations,
estimates and projections of the Management on currently available information.
Many factors could cause the actual results, performance or achievements to be
materially different from those that may be expressed or implied by such
statements. We do not assume any obligation to update the forward-looking
statements contained in this release.
Sabine Preiss
IFCO SYSTEMS N.V.
Tel: +49 89 744 91 316
Fax: +49 89 744 767 316
Email: Sabine.Preiss(at)ifco.de
Additional Information
IFCO is an international logistics service provider with more than 210 locations
worldwide. IFCO operates a pool of over 112 million Reusable Plastic Containers
(RPCs) globally, which are used primarily to transport fresh produce from
growers to leading grocery retailers. In the United States, IFCO also provides a
national network of pallet management services. IFCO is the market leader in
this industry with almost 200 million pallets sorted, repaired and recycled
annually.
WORLDWIDE RESPONSIBILITY is an IFCO initiative, under which IFCO not only
continues to assume its social and environmental responsibility but, working
with strong project partners, expands its sphere of responsible activities. With
the initiative's first social-engagement project, IFCO supports Food Banks
worldwide in their honorable effort to provide food to the needy through the
provision of reusable containers and by co-financing delivery vehicles.
[HUG#1461396]
--- End of Message ---
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Datum: 11.11.2010 - 10:23 Uhr
Sprache: Deutsch
News-ID 48675
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