Strauss Group reports fourth quarter 2015 results: 4.2% organic sales growth excluding foreign currency effects[1] and operating profit up 11.3%
In Israel, Strauss delivers quarterly sales growth surpassing market growth while continuing to cut prices
Group results continue to reflect a significant FX impact, particularly in Brazil and Russia, leading to a 6.1% drop in annual shekel-denominated sales[2]
PETACH TIKVA, Israel, March 21, 2016 /PRNewswire/ -- Gadi Lesin, President and Chief Executive Officer of Strauss Group (TASE: STRS), said today (March 21, 2016): "As a leading player in a number of significant international markets, we are impacted – positively and negatively – by world macroeconomic trends, and continue to evaluate our business on a long term perspective that has delivered substantial value to the Group over the past decade. Strauss continues to implement its global growth strategy and will continue to invest in innovation and efficiencies throughout the value chain, across the Group and its geographic markets."
Link to MD&A report
Link to Analyst Presentation
Link to Q4'15 conference call details
(1) Also excluding the impact of classification of costs following the introduction of the Food Law, as explained in the MD&A.
(2) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise.
2015 highlights(1)
- Organic sales growth, excluding foreign exchange effects, was 2.5%(2). Shekel sales were NIS 7.6 billion compared to NIS 8.1 billion in the corresponding period last year, and reflected NIS 635 million negative translation differences as a result of the continued strengthening of the NIS versus other functional currencies of the Group.
- Gross profit was NIS 2,829 million (37.0% of sales), down 9.3% compared to the corresponding period last year. Gross margins were down 1.3%.
- Operating profit (EBIT) was NIS 659 million (8.6% of sales), down 11.6% compared to the corresponding period last year. EBIT margins were down 0.6%.
- EPS for shareholders of the Company were NIS 2.73, down 21.4% compared to the corresponding period.
- Cash flows from operating activities totaled NIS 516 million, compared to NIS 561 million last year.
(1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise.
(2) Also excluding the impact of classification of costs following the introduction of the Food Law, as explained in the Board of Directors Report.
| Non GAAP Adjusted Figures (1) |
|||||
| Full Year |
|||||
| 2015 |
2014 |
Change |
Organic |
||
| Total Group Sales (NIS mm) |
7,642 |
8,140 |
-6.1% |
2.5% |
|
| Gross Profit (NIS mm) |
2,829 |
3,119 |
-9.3% |
||
| Gross Margins (%) |
37.0% |
38.3% |
-130 bps |
||
| EBITDA (NIS mm) |
891 |
964 |
-7.5% |
||
| EBITDA Margins (%) |
11.7% |
11.8% |
-10 bps |
||
| EBIT (NIS mm) |
659 |
746 |
-11.6% |
||
| EBIT Margins (%) |
8.6% |
9.2% |
-60 bps |
||
| Net Income Attributable to the Company's Shareholders (NIS mm) |
293 |
371 |
-21.1% |
||
| Net Income Margin Attributable to the Company's Shareholders (%) |
3.8% |
4.6% |
-80 bps |
||
| EPS (NIS) |
2.73 |
3.47 |
-21.4% |
||
| Operating Cash Flow (NIS mm) |
516 |
561 |
-8.0% |
||
| Capex (NIS mm) (2) |
(279) |
(564) |
-50.5% |
||
| Net debt (NIS mm) |
1,655 |
1,688 |
-2.0% |
||
| Net debt / annual EBITDA |
1.9x |
1.8x |
0.1x |
||
| (1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise. |
|||||
| (2) Investments include the acquisition of fixed assets and investment in intangibles and deferred expenses. |
|||||
| Note: Financial data were rounded to NIS millions. Percentages changes were calculated on the basis of the exact figures in NIS thousands. |
|||||
| Non GAAP Adjusted Figures (1) |
||||||||
| Full year 2015 |
||||||||
| Sales (NIS mm) |
Sales Growth vs. Last Year |
Organic Sales Growth excluding FX and Food Law |
EBIT (NIS mm) |
NIS Change in EBIT |
% Change in EBIT |
EBIT margins |
Change in EBIT margins vs. 2014 |
|
| Sales and EBIT by Operating Segments and Activities |
||||||||
| Strauss Israel: |
||||||||
| Health & Wellness |
1,898 |
-3.8% |
-1.8% |
188 |
(15) |
-7.6% |
9.9% |
-40 bps |
| Fun & Indulgence (2) |
968 |
-3.0% |
-0.7% |
93 |
(19) |
-16.8% |
9.6% |
-160 bps |
| Total Strauss Israel |
2,866 |
-3.6% |
-1.5% |
281 |
(34) |
-10.9% |
9.8% |
-80 bps |
| Strauss Coffee: |
||||||||
| Coffee Israel |
647 |
-6.1% |
-4.3% |
84 |
(17) |
-16.4% |
13.1% |
-160 bps |
| International Coffee (2) |
2,785 |
-11.2% |
12.4% |
184 |
(63) |
-25.5% |
6.6% |
-130 bps |
| Total Strauss Coffee |
3,432 |
-10.3% |
8.8% |
268 |
(80) |
-22.8% |
7.8% |
-130 bps |
| International Dips & Spreads: |
||||||||
| Sabra (50%) (2) |
711 |
10.4% |
1.7% |
94 |
3 |
3.8% |
13.2% |
-80 bps |
| Obela (50%) (2) |
41 |
4.4% |
16.5% |
(13) |
2 |
NM |
NM |
NM |
| Total International Dips & Spreads |
752 |
10.0% |
2.5% |
80 |
5 |
7.3% |
10.7% |
-30 bps |
| Other (2) |
592 |
-10.3% |
-9.9% |
30 |
22 |
288.6% |
5.0% |
+380 bps |
| Total Group |
7,642 |
-6.1% |
2.5% |
659 |
(87) |
-11.6% |
8.6% |
-60 bps |
| (1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise. |
||||||||
| (2) Fun & Indulgence figures include Strauss's 50% share in the salty snacks business. International Coffee figures include Strauss's 50% share in the Três Corações joint venture (3C) – Brazil – a company jointly held by the Group (50%) and by the local São Miguel Group (50%). International D&S figures reflect Strauss's 50% share in Sabra and Obela. Other Operations includes Strauss's share in Strauss Water China (50%) until June 30, 2015. |
||||||||
| Note: Financial data were rounded to NIS millions. Percentages changes were calculated on the basis of the exact figures in NIS thousands. |
||||||||
Q4 2015 highlights(1)
- Organic sales growth, excluding foreign exchange effects, was 4.2%(2). Shekel sales were NIS 1.9 billion compared to NIS 2.1 billion in the corresponding quarter last year, and reflected NIS 236 million negative translation differences as a result of the continued strengthening of the NIS versus other functional currencies of the Group.
- Gross profit was NIS 700 million (36.8% of sales), down 6.7% compared to the corresponding period last year. Gross margins were up 0.7%.
- Operating profit (EBIT) was NIS 158 million (8.3% of sales), up 11.3% compared to the corresponding quarter last year. EBIT margins were up 1.5%.
- EPS for shareholders of the company were NIS 0.69, down 12.4% compared to the corresponding period.
- Cash flows from operating activities totaled NIS 426 million, compared to NIS 287 million last year.
(1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise.
(2) Also excluding the impact of classification of costs following the introduction of the Food Law, as explained in the Board of Directors Report.
| Non GAAP Adjusted Figures (1) |
||||
| Q4 2015 |
||||
| 2015 |
2014 |
Change |
Organic |
|
| Total Group Sales (NIS mm) |
1,899 |
2,080 |
-8.7% |
4.2% |
| Gross Profit (NIS mm) |
700 |
750 |
-6.7% |
|
| Gross Margins (%) |
36.8% |
36.1% |
+70 bps |
|
| EBITDA (NIS mm) |
220 |
199 |
10.5% |
|
| EBITDA Margins (%) |
11.6% |
9.6% |
+200 bps |
|
| EBIT (NIS mm) |
158 |
143 |
11.3% |
|
| EBIT Margins (%) |
8.3% |
6.8% |
+150 bps |
|
| Net Income Attributable to the Company's Shareholders (NIS mm) |
74 |
84 |
-12.0% |
|
| Net Income Margin (Attributable to the Company's Shareholders) (%) |
3.9% |
4.0% |
-10 bps |
|
| EPS (NIS) |
0.69 |
0.78 |
-12.4% |
|
| Operating Cash Flow (NIS mm) |
426 |
287 |
48.4% |
|
| Capex (NIS mm) (2) |
(68) |
(109) |
-37.6% |
|
| Net debt (NIS mm) |
1,655 |
1,688 |
-2.0% |
|
| Net debt / annual EBITDA |
1.9x |
1.8x |
0.1x |
|
| (1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise. |
||||
| (2) Investments include the acquisition of fixed assets and investment in intangibles and deferred expenses. |
||||
| Note: Financial data were rounded to NIS millions. Percentages changes were calculated on the basis of the exact figures in NIS thousands. |
||||
| Non GAAP Adjusted Figures (1) |
||||||||
| Q4 2015 |
||||||||
| Sales (NIS mm) |
Sales Growth vs. Last Year |
Organic Sales Growth excluding FX and Food Law |
EBIT (NIS mm) |
NIS Change in EBIT |
% Change in EBIT |
EBIT margins |
Change in EBIT margins vs. 2014 |
|
| Sales and EBIT by Operating Segments and Activities |
||||||||
| Strauss Israel: |
||||||||
| Health & Wellness |
463 |
-0.2% |
2.1% |
47 |
3 |
5.8% |
10.1% |
+60 bps |
| Fun & Indulgence (2) |
225 |
3.1% |
5.2% |
12 |
(8) |
-38.1% |
5.5% |
-370 bps |
| Total Strauss Israel |
688 |
0.9% |
3.1% |
59 |
(5) |
-7.9% |
8.6% |
-80 bps |
| Strauss Coffee: |
||||||||
| Israel Coffee |
153 |
-9.2% |
-8.6% |
20 |
0 |
0.3% |
13.1% |
+120 bps |
| International Coffee (2) |
722 |
-16.4% |
14.3% |
49 |
13 |
35.4% |
6.7% |
+250 bps |
| Total Strauss Coffee |
875 |
-15.3% |
9.4% |
69 |
13 |
23.1% |
7.8% |
+240 bps |
| International Dips & Spreads: |
||||||||
| Sabra (50%) (2) |
172 |
-3.6% |
-4.7% |
28 |
10 |
57.0% |
16.4% |
+630 bps |
| Obela (50%) (2) |
14 |
1.5% |
19.0% |
(0) |
0 |
NM |
NM |
NM |
| Total International Dips & Spreads |
187 |
-3.2% |
-3.2% |
28 |
10 |
61.4% |
15.0% |
+600 bps |
| Other (2) |
149 |
-13.3% |
-7.6% |
2 |
(3) |
-56.1% |
NM |
NM |
| Total Group |
1,899 |
-8.7% |
4.2% |
158 |
15 |
11.3% |
8.3% |
+150 bps |
| (1) Based on non-GAAP data, which include the proportionate consolidation of jointly-held partnerships (without implementation of IFRS 11) and do not include share-based payment, valuation of the balance of commodity hedging transactions as at end-of-period and other income and expenses, unless stated otherwise. |
||||||||
| (2) Fun & Indulgence figures include Strauss's 50% share in the salty snacks business. International Coffee figures include Strauss's 50% share in the Três Corações joint venture (3C) – Brazil – a company jointly held by the Group (50%) and by the local São Miguel Group (50%). International D&S figures reflect Strauss's 50% share in Sabra and Obela. |
||||||||
| Note: Financial data were rounded to NIS millions. Percentages changes were calculated on the basis of the exact figures in NIS thousands. The figures for total International D&S were calculated on the basis of the exact Sabra and Obela figures in NIS thousands. |
||||||||
| Appendix |
||
| Reconciliations of GAAP to Non GAAP Adjusted Figures |
||
| Full Year |
||
| 2015 |
2014 |
|
| GAAP sales |
5,183 |
5,415 |
| Add back JV sales (accounted for under the equity method) (1) |
2,459 |
2,725 |
| Non GAAP sales |
7,642 |
8,140 |
| GAAP EBIT |
585 |
545 |
| Minus: Share of profits of equity-accounted investees |
(198) |
(219) |
| Plus: JV EBIT (accounted for under the equity method) |
237 |
256 |
| Additional adjustments: |
||
| Share-based payment and liability plan |
15 |
21 |
| Loss (Profit) from accounting mark-to-market of commodity hedging transactions as at the end of period |
(22) |
22 |
| Other expenses, net |
42 |
121 |
| Non GAAP Adjusted EBIT according to management reports |
659 |
746 |
| Non GAAP financing expenses, net (including JVs) |
(126) |
(83) |
| Non GAAP taxes on income (including JVs) |
(153) |
(165) |
| Taxes on income in respect of the additional adjustments above |
5 |
(9) |
| Non GAAP income for the period |
385 |
489 |
| Attributable to the Company's shareholders |
293 |
371 |
| Attributable to Non controlling interests |
92 |
118 |
| Reconciliations of GAAP to Non GAAP Adjusted Figures |
||
| Q4 |
||
| 2015 |
2014 |
|
| GAAP sales |
1,302 |
1,364 |
| Add back JV sales (accounted for under the equity method) (1) |
597 |
716 |
| Non GAAP sales |
1,899 |
2,080 |
| GAAP EBIT |
156 |
52 |
| Minus: Share of profits of equity-accounted investees |
(64) |
(49) |
| Plus: JV EBIT (accounted for under the equity method) |
66 |
49 |
| Additional adjustments: |
||
| Share-based payment and liability plan |
3 |
5 |
| Loss from accounting mark-to-market of commodity hedging transactions as at the end of period |
(25) |
28 |
| Other expenses, net |
22 |
58 |
| Non GAAP Adjusted EBIT according to management reports |
158 |
143 |
| Non GAAP financing expenses, net (including JVs) |
(27) |
(13) |
| Non GAAP taxes on income (including JVs) |
(43) |
(6) |
| Taxes on income in respect of the additional adjustments above |
10 |
(14) |
| Non GAAP income for the period |
98 |
110 |
| Attributable to the Company's shareholders |
74 |
84 |
| Attributable to Non controlling interests |
24 |
26 |
| (1) Starting the third quarter, excluding sales of Haier Strauss Water JV in China, which are accounted for under the equity method in the Non GAAP figures. |
||
For further information please contact:
| Talia Sessler Investor Relations Director Strauss Group Ltd. 972-54-577-2195 972-3-675-2545
|
Osnat Golan VP Communications & Digital, Spokesperson Strauss Group Ltd. 972-52-828-8111 972-3-675-2281 Or Gil Messing External Communications Director Strauss Group Ltd. 972-54-252-5272
|
SOURCE Strauss Group
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