Scandinavian Tobacco Group A/S - Interim report, 1 January-30 September 2019
14 November 2019 - 6:00PM
Scandinavian Tobacco Group A/S - Interim report, 1 January-30
September 2019
Company Announcement No.12 2019
Copenhagen,14 November 2019 Scandinavian Tobacco Group A/S -
Interim report, 1 January-30 September 2019 Scandinavian
Tobacco Group delivers organic EBITDA growth of 5.4% and strong
cash flow in the third quarter of 2019 Q3 2019
Highlights
- Net sales of DKK 1,846 million (DKK 1,887 million). Organic
growth -4.5%
- EBITDA before special items of DKK 446 million (DKK 398
million). Organic growth 5.4%
- EBITDA margin before special items was 24.2% (21.1%). Excluding
IFRS 16, the margin improved by 1.9% points
- Free cash flow before acquisitions of DKK 503 million (DKK 327
million)
- Earnings Per Share (EPS) of DKK 1.7 (DKK 2.2). EPS adjusted for
special items of DKK 2.6 (DKK 2.4)
- Agreement of the terms and conditions for the acquisition of
Royal Agio Cigars
In the third quarter of 2019, Scandinavian Tobacco Group A/S
delivered net sales of DKK 1,846 million and EBITDA before special
items of DKK 446 million. The quarter delivered positive organic
growth in EBITDA of 5.4% with EBITDA margins (excluding IFRS 16)
improving by 1.9% driven by Region Smoking Tobacco &
Accessories and North America Branded. Organic growth in net sales
was negative by 4.5% driven by all divisions. In the first nine
months of 2019, the Group reported negative organic net sales
growth of 2.4% and organic EBITDA growth of 5.8%, generating a free
cash flow before acquisitions of DKK 819 million (DKK 464 million)
and an EPS of DKK 4.7 (DKK 5.1). EPS adjusted for special items
were DKK 5.9 (DKK 5.4). CEO of Scandinavian Tobacco Group Niels
Frederiksen says: “In the third quarter of the year we deliver
organic EBITDA growth of 5.4%, continued margin improvements and a
strong free cash flow despite a disappointing development in
organic net sales. This follows better than expected progress from
our transformational program Fuelling the Growth and continued cash
flow focus across our business. During the quarter we were also
able to announce our intention to acquire Royal Agio Cigars; a
significant step in support of our ambition to become the
undisputed leader in cigars and pipe tobacco.”
Financial guidance for 2019The full-year guidance for
free cash flow is revised up and is now about 1 billion from
previously >750 million. Special items are expected to be about
DKK 200 million. The revised expectation includes transaction costs
from the Royal Agio Cigars acquisition of about DKK 20 million,
costs for the closure of Scandinavian Tobacco Group Lane Ltd.’s
facility in the US of up to DKK 120 million and lower than
previously anticipated costs relating to the Fuelling the Growth
program. The guidance for organic growth in EBITDA is
unchanged.
- >5% organic growth in EBITDA
- Special items of about DKK 200 million
- Free cash flow before acquisitions about 1 billion (previous
>DKK 750 million)
In the fourth quarter of 2019, we expect that the development in
organic net sales will remain weak.
Conference Call and Webcast A conference call and webcast
will be held on 14 November 2019 at 10:00 AM CET. Presentation
materials will be available online approximately one hour before
the webcast on investor.st-group.com. Dial-in details: Denmark:
+45 3272 8042 The
UK: +44 (0)
844 571 8892 The US:
+1 631 510 7495
Passcode: 3155398
https://edge.media-server.com/mmc/p/duuim98j For further
information, please contact: Investors: Torben Sand, Head of
Investor Relations, phone: +45 5084 7222 or
torben.sand@st-group.com Media: Simon Mehl Augustesen, Director of
Group Communications, phone: +45 5084 7211 or
simon.augustesen@st-group.com