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Azelis H1 2022: Strong Momentum Drives 91% Adjusted EBITA Growth

·23-min read

ANTWERP, Belgium, August 09, 2022--(BUSINESS WIRE)--Regulatory News:

Azelis Group (Brussels:AZE):

H1 2022 Highlights

  • Revenue of EUR 2.0bn, representing year-on-year growth of 54.2%, of which 27.6% was organic. In Q2, revenue growth was 49.6%, with trends remaining strong across all regions.

  • Five acquisitions completed in H1, representing total full year revenue of over EUR 190m. Five more acquisitions representing additional total full year revenue of EUR 270m have been signed and expected to close in H2 2022.

  • Gross profit of EUR 488.6m represents year-on-year growth of 64.9%, of which 37.7% was organic.

  • Adjusted EBITA of EUR 242.6m represents a 90.7% increase and a 230 bp margin step-up. Conversion margin expanded by 673 bp compared to H1 2021, at 49.7%.

  • Net profit of EUR 141.7m represents a year-on-year increase of 198.0%, driven by the strong topline growth, positive margin developments and lower financial costs.

  • Free cash flow of EUR 139.2m shows an increase of 74.1%, despite continued investments in working capital to support strong growth.

  • Leverage ratio was reduced to 2.3x at the end of June 2022, compared to 5.4x at the end of June 2021, and 2.7x at the end of December 2021.

  • The Group expects to achieve full year 2022 adjusted EBITA in the range of EUR 410m-425m, versus the recently-upgraded consensus estimate of EUR 370m.

  • Tom Hallam has been appointed to the Board of Directors, and Chairman of the Audit and Risk Committee, succeeding Jürgen Buchsteiner, who is retiring from the Board after 4 years of service.

Azelis Group
(EUR m)

H1 2022

H1 2021

Reported
Change

Constant
Currency

Revenue

2,019.0

1,309.5

54.2%

49.9%

Gross Profit

488.6

296.4

64.9%

60.9%

Gross Profit Margin

24.2%

22.6%

157 bp

162 bp

Adjusted EBITDA1

255.0

136.4

86.9%

82.9%

Adjusted EBITDA Margin

12.6%

10.4%

221 bp

224 bp

Adjusted EBITA2

242.6

127.2

90.7%

86.7%

Adjusted EBITA Margin

12.0%

9.7%

230 bp

232 bp

Conversion Margin3

49.7%

42.9%

673 bp

672 bp

Net Profit

141.7

47.5

198.0%

193.5%

Earnings per share (EPS€)4

0.59

0.20

200.8%

193.1%

Operating Cash Flow

151.5

90.2

Free Cash Flow5

139.2

80.0

FCF Conversion ratio6

56.9%

62.4%

Net Working Capital / Revenue normalized for acquisitions7

15.4%

12.5%

Leverage Ratio

2.3

5.4

  1. Adjusted EBITA before depreciation of property, plant and equipment

  2. Operating profit or loss before amortization and impairment of intangible assets and excluding adjustments

  3. Adjusted EBITA / Gross profit

  4. Prior year adjusted for current number of shares

  5. Adjusted EBITDA less lease payments, plus changes in Net Working Capital, plus changes in other assets, liabilities and provisions, less net capital expenditures

  6. Free Cash Flow divided by Adjusted EBITDA less lease payments

  7. Net Working Capital/Revenue including those from acquisitions for the full period

Comment from Dr. Hans Joachim Müller, CEO: "I am pleased to present a strong set of H1 2022 results. In-line with our communication earlier in the year, the positive momentum in Q1 carried on to Q2, leading to revenue growth of 54% for the first half of the year. We delivered another set of record results, generating almost 28% organic growth and a trebling in net profit, whilst reducing our leverage. Despite the lingering macroeconomic uncertainty, we remain focused on strengthening our business with new or expanded principal mandates, value-enhancing acquisitions and investments in our digital and laboratory network. Based on the strong performance in H1 2022, as well as our confidence in the resilience of our business, we expect to exceed current consensus expectation and deliver adjusted EBITA in the range of EUR 410m-425m for the full year.

I would like to take this opportunity to welcome Tom Hallam, who has joined the Azelis Board of Directors, and will be chairing our Audit & Risk Committee. Tom’s track record in finance leadership and his breadth of industry experience will be invaluable to Azelis as we continue to grow our business and strengthen our global footprint. We thank Jürgen Buchsteiner for his service to the Board and the wider Azelis family and seeing the Group through its various growth milestones culminating in the IPO in 2021. The entire Azelis leadership team is excited for the opportunities and challenges ahead, and we remain committed to achieving our mission to become the reference innovation service provider in the specialty chemicals distribution industry."

  1. Combined annual revenue in 2021

  2. Company compiled average consensus estimate as of July 20, 2022 (includes estimates of 9 sell-side analysts)

RESULTS PRESENTATION BY MANAGEMENT

The management of Azelis invites you to a conference call and live webcast at 10:00 CET to discuss the operating trends and outlook for the remainder of the year. Please click here to view the webcast.

OPERATIONAL REVIEW

Azelis Headline Results
(EUR m)

H1 2022

H1 2021

F/X
Translation

M&A
Growth
Contribution

Organic
Growth

Total
Growth

EMEA

916.4

598.6

-1.3%

22.0%

32.3%

53.1%

Americas

762.9

528.5

9.8%

11.5%

23.0%

44.3%

Asia Pacific

339.7

182.4

6.3%

54.4%

25.6%

86.3%

Group Revenue

2,019.0

1,309.5

4.2%

22.3%

27.6%

54.2%

EMEA

224.6

144.4

-1.0%

17.3%

39.4%

55.6%

Americas

196.9

114.5

9.8%

24.3%

37.8%

71.9%

Asia Pacific

67.1

37.6

5.6%

42.2%

30.5%

78.4%

Group Gross Profit

488.6

296.4

4.0%

23.2%

37.7%

64.9%

Azelis delivered total revenue of EUR 2.0bn, representing growth of 54.2% compared to H1 2021 (+49.9% in constant currency), driven by continued strength in end market demand and benefits from the Group’s increasing scale. The positive trends in our business are reflected in organic growth of 27.6% generated by the Group’s businesses during the period. Revenue growth contribution from acquisitions was 22.3%, whilst FX represented a 4.2% revenue tailwind.

Demand remains strong in life sciences, with revenue growing 50.6% year-on-year, driven by continued growth in Food & Nutrition and Personal Care, as well as the ongoing recovery trends in Pharma. Likewise, positive demand and pricing trends supported a 59.9% revenue growth in industrial chemicals.

Azelis EMEA
(EUR m)

Q2 2022

Q2 2021

Reported
Change

H1 2022

H1 2021

Reported
Change

Constant
Currency

Revenue

465.9

301.4

54.6%

916.4

598.6

53.1%

54.4%

Gross Profit

113.0

73.2

54.3%

224.6

144.4

55.6%

56.6%

Gross Profit Margin

24.3%

24.3%

-4 bp

24.5%

24.1%

39 bp

33 bp

Adjusted EBITDA

62.6

35.2

77.8%

125.2

71.3

75.5%

77.3%

Adjusted EBITDA Margin

13.4%

11.7%

176 bp

13.7%

11.9%

174 bp

181 bp

Adjusted EBITA

59.9

33.0

81.3%

120.0

67.1

78.9%

80.8%

Adjusted EBITA Margin

12.9%

11.0%

190 bp

13.1%

11.2%

189 bp

196 bp

Conversion Margin

53.0%

45.1%

790 bp

53.4%

46.5%

697 bp

736 bp

EMEA revenue increased by 53.1% to EUR 916.4m in H1 2022, on organic growth of 32.3%, supported by sustained positive momentum in life sciences, as well as growth acceleration in industrial chemicals due to recent mandate gains. Revenue growth contribution from acquisitions was 22.0%, whilst FX translation was a 1.3% headwind during the period.

In January, Azelis completed the acquisition of Umongo, a leading specialty distributor active in L&MWF in South Africa. In March, the acquisition of WhitChem, a specialty distributor in CASE and R&PA in the UK was completed. In May, we closed the acquisition of Tunçkaya, a leading distributor of specialty food ingredients and additives in Turkey. These companies generated combined annual revenue of over EUR 125m in 2021.

Gross profit increased 55.6% year-on-year to EUR 224.6m in H1 2022, representing a 39 bp margin uplift, as we continue to successfully manage the ongoing price inflation in the industry with our price-through policy. Adjusted EBITA grew 78.9% to EUR 120.0m, resulting in a 189 bp margin expansion to 13.1%, and a 697 bp increase in conversion margin, reflecting the benefit of our scale in the region as well as continuous efficiency improvements.

Azelis Americas
(EUR m)

Q2 2022

Q2 2021

Reported
Change

H1 2022

H1 2021

Reported
Change

Constant
Currency

Revenue

396.4

284.8

39.2%

762.9

528.5

44.3%

34.6%

Gross Profit

104.0

62.5

66.2%

196.9

114.5

71.9%

62.1%

Gross Profit Margin

26.2%

22.0%

427 bp

25.8%

21.7%

414 bp

414 bp

Adjusted EBITDA

60.3

33.2

81.7%

111.8

60.1

85.9%

76.2%

Adjusted EBITDA Margin

15.2%

11.6%

355 bp

14.7%

11.4%

328 bp

378 bp

Adjusted EBITA

58.2

31.8

82.8%

107.9

57.5

87.6%

77.9%

Adjusted EBITA Margin

14.7%

11.2%

350 bp

14.1%

10.9%

326 bp

327 bp

Conversion Margin

56.0%

50.9%

508 bp

54.8%

50.2%

457 bp

461 bp

Revenue in the Americas was EUR 762.9m, representing year-on-year growth of 44.3%, of which 23.0% was organic. Our life science business continued to be driven by strong end-market demand, whilst industrial chemicals was supported by both demand and positive pricing trends. In the Americas, revenue growth contribution from acquisitions was 11.5%, while the recent strengthening of the USD resulted in a 9.8% FX translation growth contribution.

In June, Azelis signed an agreement to acquire ROCSA, a leading specialty chemical distributor in South America. The acquisition represents the Group's entry into South America, and is an important milestone in its expansion strategy in the region. In 2021, ROCSA generated revenue of EUR 98m.

Gross profit in the region grew by 71.9% to EUR 196.9m, resulting in a 414 bp gross margin expansion versus H1 2021. During the period, adjusted EBITA increased 87.6% to EUR 107.9m, translating to a 326 bp margin uplift driven largely by the strong growth in topline and gross profit. Our businesses in the Americas delivered a 54.8% conversion margin in H1 2022, representing a 457 bp improvement over the previous year.

Azelis Asia Pacific
(EUR m)

Q2 2022

Q2 2021

Reported
Change

H1 2022

H1 2021

Reported
Change

Constant
Currency

Revenue

181.4

111.5

62.7%

339.7

182.4

86.3%

80.0%

Gross Profit

35.6

22.8

56.1%

67.1

37.6

78.4%

72.8%

Gross Profit Margin

19.6%

20.5%

-83 bp

19.7%

20.6%

-88 bp

-74 bp

Adjusted EBITDA

16.5

9.9

66.8%

31.5

15.8

99.7%

94.2%

Adjusted EBITDA Margin

9.1%

8.9%

22 bp

9.3%

8.6%

62 bp

68 bp

Adjusted EBITA

15.1

8.9

69.8%

28.6

13.9

105.7%

100.1%

Adjusted EBITA Margin

8.3%

8.0%

35 bp

8.4%

7.6%

79 bp

85 bp

Conversion Margin

42.3%

38.9%

340 bp

42.7%

37.0%

567 bp

568 bp

APAC remains the fastest-growing region in the Group, with revenue increasing by 86.3% to EUR 339.7m in H1 2022. The growth was driven by continued strength in life sciences, as well as a significant expansion in the Group’s footprint in industrial chemicals in the region from recent acquisitions. Organic growth in the region remained strong at 25.6% as the impact of lockdowns in China was offset by the strong performance in the rest of the region. Acquisitions contributed 54.4% of revenue growth, whilst FX translation represented a 6.3% tailwind in H1 2022.

In February, we completed the acquisition of Catalite, a specialty distributor in the Personal and Home Care market segments, in Thailand. In May, we closed the acquisition of Chemo India, a local specialty distributor active in CASE and R&PA market segments. These companies generated combined annual revenue of EUR 65m in 2021.

Gross profit in the region grew 78.4% to EUR 67.1m in H1 2022, implying an 88bp margin contraction due mostly to negative mix effect from recent acquisitions, which are expected to deliver continuous margin improvement following integration into the Azelis network. The temporary gross margin dilution was offset by scale efficiencies, as reflected in adjusted EBITA growth of 105.7%, resulting in a 567 bp expansion in conversion margin to 42.7%.

Holding companies

Q2 2022

Q2 2021

Reported
Change

H1 2022

H1 2021

Reported
Change

Constant
Currency

Adjusted EBITA (EURm)

-6.6

-6.1

6.8%

-13.9

-11.3

23.3%

23.3%

As % of Group Revenues

-0.6%

-0.9%

25 bp

-0.7%

-0.9%

17 bp

-4 bp

Operating costs at the Group’s holding companies, relating to the Group’s non-operating entities as well as the head office in Belgium, were EUR 13.9m in H1 2022, compared to EUR 11.3m in the previous year. Relative to revenue, operating costs at the Group’s holding companies show a marginal improvement at constant currency.

OUTLOOK

Our strategy of driving growth is underpinned by a constantly strengthening lateral value chain, supported by continuous investments in innovation capabilities and digitalization, as well as a commitment to sustainability to create long-term value. In line with this, we are positive that we should be able to generate 8-10% of revenue growth and deliver 10-15 bps adjusted EBITA margin expansion per year in the medium-term.

Although uncertainty from ongoing supply chain disruptions as well as sustained inflation persist, the outlook for the remainder of 2022 remains positive for Azelis. Given the strong performance in the first half, the management expects to achieve adjusted EBITA in the range of EUR 410m-425m for the full year 2022.

FINANCIAL REVIEW

Azelis Group
(EUR m)

H1 2022

H1 2021

F/X
Translation

M&A
Growth
Contribution

Organic
Growth

Total
Growth

Revenue

2,019.0

1,309.5

4.2%

22.3%

27.6%

54.2%

Gross Profit

488.6

296.4

4.0%

23.2%

37.7%

64.9%

Azelis Group
(EUR m)

Q2 2022

Q2 2021

Reported
Change

H1 2022

H1 2021

Reported
Change

Constant
Currency

Life Sciences

615.8

430.1

43.2%

1,208.7

802.8

50.6%

46.8%

Industrial Chemicals

427.9

267.6

59.9%

810.4

506.7

59.9%

54.9%

Group Revenue

1,043.7

697.8

49.6%

2,019.0

1,309.5

54.2%

49.9%

Gross Profit

252.7

158.6

59.3%

488.6

296.4

64.9%

60.9%

Gross Profit Margin

24.2%

22.7%

147 bp

24.2%

22.6%

157 bp

162 bp

Adjusted EBITDA

133.0

72.4

83.8%

255.0

136.4

86.9%

82.9%

Adjusted EBITDA Margin

12.7%

10.4%

237 bp

12.6%

10.4%

221 bp

224 bp

Adjusted EBITA

126.6

67.6

87.3%

242.6

127.2

90.7%

86.7%

Adjusted EBITA Margin

12.1%

9.7%

244 bp

12.0%

9.7%

230 bp

232 bp

Conversion Margin

50.1%

42.6%

749 bp

49.7%

42.9%

673 bp

672 bp

Operating Profit

109.1

55.1

98.1%

211.8

104.7

102.2%

99.0%

Net Profit

70.4

23.4

201.1%

141.7

47.5

198.0%

193.5%

Revenue

Revenue increased 54.2% to EUR 2.0bn in H1 2022, supported by continued strong momentum across our businesses in all regions. Organic growth in Q2 was 23.3%, bringing organic growth for H1 2022 to 27.6%. Revenue growth from acquisitions was EUR 292m, representing topline growth contribution of 22.3% for the period. In addition, the Group benefitted from 4.2% of FX translation tailwind during the period.

Revenue in life sciences grew 50.6% in H1 2022 as demand remains strong in Food and Personal Care across all regions, and the recovery in Pharma has accelerated. Revenue in industrial chemicals increased 59.9%, driven by the Group’s expanding footprint in the segment through recent acquisitions, in addition to supportive demand especially in CASE and R&PA, and continued positive pricing environment.

Across our geographic markets, organic growth remained strong, with EMEA, Americas and APAC delivering 32.3%, 23.0% and 25.6% organic growth respectively.

Profitability

In H1 2022, gross profit increased by 64.9% to EUR 488.6m. The 157 bp gross margin expansion to 24.2% was supported by our continuing price management initiatives to offset the impact from the ongoing price inflation across the industry, as well as a net positive mix effect from recent acquisitions.

Adjusted EBITA grew 90.7% to EUR 242.6m. The 230 bp margin expansion was largely driven by strong topline growth and scale benefits, mitigating the impact from continuing supply chain pressures. The strong profit expansion drove a 673 bp expansion in the Group’s conversion margin to 49.7% in H1 2022.

Net financial expense in H1 2022 was EUR 21.1m, a 29.4% reduction compared to the previous year, due largely to a 34.3% reduction in interest expense from lower debt. Tax expense in H1 2022 was EUR 49m, implying an effective tax rate (ETR) of 25.7%, versus 37% in the previous year, as we progress towards a structure reflecting the Group’s actual tax exposure in geographies where we generate our profits.

Adjusted net profit for H1 2022 was EUR 141.7m, an increase of 194.8% compared to H1 2021. Earnings per share for the period is EUR 0.59, representing a year-on-year increase of 200.8%.

Azelis Group
(EUR m)

H1 2022

H1 2021

Operating Profit

211.8

104.7

Net Financial Expense

-21.1

-29.8

Financial Income

0.3

2.7

Interest Income

0.2

0.2

Other Financial Gains

0.1

0.0

Financial Expense

-21.4

-32.5

Interest Expense on Bank Loans and Overdrafts

-12.2

-26.3

Interest Lease Commitments

-1.6

-1.4

Accelerated Amortization of Transaction Costs due to IPO

0.0

0.0

Other Financial Cost

-7.5

-4.8

Profit Before Tax

190.7

74.9

Tax Expense

-49.0

-27.3

Net Profit

141.7

47.5

One-off Cash and Non-cash Charges due to IPO:

IPO Cost

0.0

0.5

Accelerated Amortization of Transaction Costs due to IPO

0.0

0.0

Adjusted Net Profit

141.7

48.1

Cash Flow and Financing

Net working capital to revenue normalized for acquisitions was 15.4% at the end of June 2022, compared to 15.3% at the end of December 2021 and 12.5% in the prior year. The elevated working capital intensity is due largely to the impact of new acquisitions that are not yet at Group level, as well as higher inventory to support the strong demand across our businesses. On our organic scope, NWC was 13.4% of revenue.

Despite the increase in working capital investments, the strong topline growth resulted in operating cash flow of EUR 151.5m in H1 2022, a 68.0% increase compared to the prior year. Capital expenditure increased 34.0% to EUR 8.5m, as the Group accelerated its investments in digital and IT infrastructure, and our laboratory network.

Free cash flow increased by 74.1% to EUR 139.2m, representing free cash flow conversion ratio of 56.9%, versus 62.4% in prior year. The decline in free cash flow conversion ratio was driven by the temporary increase in working capital investments to support the strong demand across our businesses.

At the end of June 2022, net debt was at EUR 990.8m and leverage ratio stood at 2.3x, versus 2.7x in December 2021, and 5.4x in June 2021. At the end of the period, the Group had liquidity of EUR 615.7m in both cash and unused revolving credit facility (RCF).

Azelis Group
(EUR m)

H1 2022

H1 2021

Operating Cash Flow

151.5

90.2

Free Cash Flow

139.2

80.0

FCF Conversion

56.9%

62.4%

Net Working Capital / Revenue normalized for acquisitions

15.4%

12.5%

Net Indebtedness

990.8

1,531.7

Net Leverage

2.3

5.4

Board appointment

Azelis has appointed Tom Hallam to the group’s board of directors effective August 2, 2022. Mr. Hallam will serve as a non-executive and independent director and chair of the audit and risk committee. He succeeds Jürgen Buchsteiner, who will be retiring from the Azelis board after four years of valuable contributions as a board member and particularly steering the audit and risk committee.

Mr. Hallam’s career spans over 30 years of experience in finance leadership roles. He is currently Chief Financial Officer at Givaudan, a global leader in Fragrance & Beauty and Taste & Wellbeing. He joined Givaudan in 2008 as Group Controller, with responsibility for financial reporting and compliance, strategic planning and management of Givaudan’s business development process. He was appointed Chief Financial Officer effective January 1, 2017. Mr. Hallam began his career in the UK working in various industries and positions. He moved to Switzerland in 1996 to join Serono in Geneva, where he held a number of positions of increasing responsibility including Financial Director for Manufacturing Operations, and in 2001 he was appointed Vice President, Corporate Finance. A UK and Swiss national, Mr. Hallam holds a degree in Accounting and Finance from the University of Manchester and is a member of the Chartered Institute of Management Accountants (CIMA).

Including Mr. Hallam, Azelis’ board of directors is comprised of eight directors, four of whom are non-executive and independent.

Post closing event

The Group completed the acquisition of ROCSA Colombia SA on the 1st of July, 2022.

APPENDIX

All figures and tables contained in this appendix have been extracted from Azelis' unaudited condensed consolidated interim financial statements for the first six months of 2022, which have been prepared in accordance with IAS 34 Interim Financial Reporting, as adopted by the European Union.

The statutory auditor, PwC Bedrijfsrevisoren BV / Reviseurs d’Entreprises SRL, represented by Peter Van den Eynde, has reviewed these condensed consolidated interim financial statements and concluded that based on the review, nothing has come to the attention that causes them to believe that the condensed consolidated interim financial information is not prepared, in all material respects, in accordance with IAS 34, as adopted by the European Union.

For the condensed consolidated interim financial statements for the first six months of 2022 and the review report of the statutory auditor we refer to Azelis' website.

Jan-June
2022

Jan-June
2021

(in thousands of €)

Revenue

2,019,049

1,309,459

Other operating income

8,734

4,390

Total income

2,027,783

1,313,849

Costs for goods and consumables

-1,539,192

-1,017,468

Gross profit

488,591

296,381

Employee benefits expenses

-143,122

-104,951

External services and other expenses

-93,246

-60,250

Depreciation of property, plant and equipment

-12,363

-9,217

Amortization & impairment of intangible assets

-28,087

-17,222

Operating profit / loss (-)

211,773

104,741

Financial income

316

2,697

Financial expenses

-21,395

-32,542

Net financial expense

-21,079

-29,845

Profit / loss (-) before tax

190,694

74,896

Income tax income / expense (-)

-48,999

-27,349

Net profit / loss (-) for the period from continuing operations

141,695

47,547

Attributable to:

Equity holders of the parent

138,814

46,157

Non-controlling interests

2,881

1,390

Net profit / loss (-) for the period

141,695

47,547

in Euro's

in Euro's

Basic earnings per share

0.59

0.20

Diluted earnings per share

0.59

0.20

30 June
2022

31
December
2021

(in thousands of €)

Assets

Goodwill

1,981,613

1,803,266

Intangible assets

1,085,243

1,004,258

Property, plant and equipment

57,086

53,008

Right of Use assets

81,107

65,582

Investments in associates

176

180

Other financial assets

752

1,355

Deferred tax assets

13,155

10,482

Total non-current assets

3,219,132

2,938,131

Inventories

610,973

467,473

Trade and other receivables

568,682

428,950

Income tax receivables

8,376

4,432

Other financial assets

4,486

1,522

Cash and cash equivalents

385,679

141,293

Total current assets

1,578,196

1,043,670

Total assets

4,797,328

3,981,801

Equity

Share capital

5,680,000

5,680,000

Reserves

-3,531,291

-3,617,020

Retained earnings

181,354

96,817

Unappropriated result

138,814

67,756

Issued capital and reserves attributable to owners of the parent

2,468,877

2,227,553

Non-controlling interests

44,603

23,792

Total equity

2,513,480

2,251,345

Loans and borrowings

1,173,150

840,030

Lease obligations

66,772

54,078

Employee benefit obligations

9,505

8,822

Provisions

4,990

4,127

Other non-current liabilities

46,151

9,655

Deferred tax liabilities

159,814

135,315

Total non-current liabilities

1,460,382

1,052,027

Bank overdrafts

27,416

40,524

Loans and borrowings

90,573

62,604

Lease obligations

17,775

15,200

Provisions

2,917

1,981

Income tax payables

28,467

17,046

Trade and other payables

656,318

541,074

Total current liabilities

823,466

678,429

Total liabilities

2,283,848

1,730,456

Total equity and liabilities

4,797,328

3,981,801

Jan-June
2022

Jan-June
2021

(in thousands of €)

Cash flows from operating activities

Net profit / loss (-) for the period

141,695

47,547

Adjustments for:

Depreciation, amortisation and impairment expenses

40,450

26,439

Net financial expense

21,079

29,845

Cost of share-based payment

248

-

Income tax income / expense

48,999

27,349

Change in inventories

-82,286

-27,213

Change in trade and other receivables and other investments

-79,737

-74,862

Change in trade and other payables

59,294

60,439

Change in provisions

1,752

608

Cash flow from operating activities

151,494

90,152

Income tax paid

-38,807

-21,303

Interest paid

-16,647

-29,125

Net cash flow from operating activities

96,040

39,724

Cash flow from investing activities

Acquisition of property, plant and equipment and intangible assets

-8,463

-6,315

Acquisition of subsidiaries, net of cash acquired

-171,841

-460,372

Net cash flow from investing activities

-180,304

-466,687

Cash flows from financing activities

Payments of lease obligation

-10,403

-8,190

Proceeds from shareholders for issue of equity

-

50,000

Dividend payment to shareholders of the Group

-5,686

-

Purchase of treasury shares

-2,999

-

Proceeds from loans and borrowings

403,285

363,098

Repayments of loans and borrowings

-39,332

-27,213

Other cash flows from financing activities

-3,139

-2,475

Net cash flow from financing activities

341,726

375,220

Net (decrease) increase in cash and cash equivalents

257,462

-51,743

Effect of exchange rate fluctuations on cash held

32

-798

Cash and cash equivalents minus Bank overdraft at beginning of the period

100,769

139,693

Cash and cash equivalents minus Bank overdraft at 30 June

358,263

87,152

NOTES AND DISCLAIMER

Azelis is a leading global innovation service provider in the specialty chemical and food ingredients industry present in 57 countries across the globe with +3,000 employees. Our knowledgeable teams of industry, market and technical experts are each dedicated to a specific market within Life Sciences and Industrial Chemicals. We offer a lateral value chain of complementary products to more than +51,000 customers, supported by +2,300 principal relationships, creating a turnover of €2.8 billion (2021). Azelis Group NV is listed on Euronext Brussels under ticker AZE.

Across our extensive network of more than 60 application laboratories, our award-winning staff help develop formulations and provide technical guidance throughout the customers’ product development process. We combine a global market reach with a local footprint to offer a reliable, integrated and unique digital service to local customers and attractive business opportunities to principals. EcoVadis Platinum rated, Azelis is a leader in sustainability. We believe in building and nurturing solid, honest and transparent relationships with our people and partners.

Impact through ideas. Innovation through formulation.

This announcement may contain statement relevant to Azelis Group NV (the "Company") and/or its affiliated companies (collectively "Azelis" or the "Azelis Group") which are not historical facts and are hereby identified as "forward-looking statements". Such forward looking statements, include, without limitation, those relating to the future business prospects, revenue, working capital, liquidity, capital needs, interest costs and income, in each case relating to the Azelis Group.

The forward-looking statements and estimates contained herein represent the judgement of and are based on the information available to the Company’s management as of the date of this announcement. They involve a number of known and unknown risks, uncertainties and other factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by the forward looking statements.

These forward-looking statements should not be considered as guarantees for future performance of the Azelis Group and should, therefore, be considered in light of various important factors that could cause actual results to differ materially from estimates or projections contained in the forward looking statements. These include without limitation economic and business cycles, the terms and conditions of the Azelis’ financing arrangements, foreign currency rate fluctuations, competition in Azelis’ key markets, acquisitions or disposals of businesses or assets and trends in Azelis’ principal industries or economies.

The foregoing list of important factors is not exhaustive. When considering forward looking statements, careful consideration should be given to the foregoing factors and other uncertainties and events, as well as factors described in any other document published by the Company with the Belgian Financial Services and Markets Authority ("FSMA") or on the Azelis website (www.azelis.com/investor-relations) from time to time, including the prospectus related to the admission to trading of the securities of Azelis Group NV on the regulated market of Euronext Brussels dated 14 September 2021. No undue reliance should be placed on such forward looking statements which are relevant only as of the date of this announcement. Except as required by the FSMA, Euronext or otherwise in accordance with applicable law, the Company undertakes no obligation to update publicly or revise any forward looking statements, whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220808005362/en/

Contacts

CONTACT INFORMATION
Azelis Investor Relations
T: +32 3 613 01 27
E: investor-relations@azelis.com