Annual Results Announcement
MAY 3, 2023
ANNUAL RESULTS ANNOUNCEMENT 2022 2
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INDEX
01 | Message from the CEO | 03 | |||
02 | Main Activity Indicators | 05 | |||
03 | Relevant Facts | 06 | |||
Management Report | 07 | ||||
04 4.1 | Macroeconomic context | 07 | |||
4.2 | Sector framework | 10 | |||
4.3 | Consolidated performance | 12 | |||
4.4 | Business area performance | 15 | |||
4.5 | Outlook for 2023 | 23 | |||
05 | Consolidated Accounts | 25 | |||
06 | Additional information | 27 |
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01 Message of the CEO
The results achieved in 2022 were very positive and reinforce our optimism regarding the development of Inapa Group. This performance is the corollary of the strategy executed in recent years, which was marked by structural processes of acquisition and optimization that have implied an enormous dedication of our teams.
Turnover reached 1,212 million euros, corresponding to an increase of 26% compared to 2021, while the gross margin grew by 35% (plus 63 million euros), from 18.6% to 20.0% of sales.
Despite an increase in operating costs (induced by higher activity, rising inflation and by the end government supports obtained in the context of the Covid-19 period), efficiency measured as a percentage of sales increased significantly. Operating costs accounted for 15.3% of sales, corresponding to an improvement of 2.9pp compared to 2021. This variation reflects gains from reorganizations implemented in Germany, France and Spain.
The increase in gross margin, combined with the decrease in the weight of operating costs, led to a significant improvement in the recurring EBITDA which amounted to 86.9 million euros (more 55.4 million euros than in
2021). This improvement corresponds to an expressive evolution of the recurring EBITDA margin (vs sales) from 3.3% to 7.2%.
Net income reached 17.8 million euros (corresponding to an increase of 14.4 million euros compared to 2021), despite the increase in financial charges related with higher interest rates.
Regarding the balance sheet, I highlight that net debt decreased by 40.7 million euros compared to December 2021, to 221 million euros. As a consequence, the Net Debt/Re- EBITDA ratio declined to 2.5x (compared to 8.3x in 2021).
These results reinforce the confidence in our strategy and in the Groups' ability to meet the challenges we may face in the coming years. Particularly, considering that they were achieved in a highly demanding context marked by the post-Covid-19 challenges, the conflict in Ukraine, and by the limitations on paper availability related with the closure or suspension of several paper mills (at a time when demand was higher than supply).
The abovementioned effects led to a substantial increase in production costs and consequently to an increase in market
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prices. In the last quarter of 2022, there was a significant drop in paper demand, related to a generalized option, by the different players across the value chain, to reduce paper stock levels. This pattern was extended to the beginning of 2023.
In 2022, we continue our optimization activity by implementing new processes to reduce costs and create more flexible structures. We extended the use of the Group's new ERP (SAP S/4HANA) to Portugal and Spain. The implementation of the new ERP in the Group should be completed in 2023 in France and Turkey.
From a sustainable development point of view, besides having continued with investment and improvement actions, we have made significant progress, of which I highlight,
for example, the increase in the share of ecological papers in sales and the reduction of energy consumption, GHG emissions, waste generation, occupational accidents and diseases.
We have achieved a substantial part of the targets we set in relation to the United Nations Sustainable Development Goals (SDGs), and we have established new targets for 2023 and 2024.
I therefore believe that we have successfully started the implementation of the strategic guidelines defined for the 2022-2024 period. These lines follow the plan of the previous triennium and promote three pillars: efficiency, growth in the non-paper business and impact on sustainability.
Finally, I would like to express my gratitude to our employees, clients, suppliers, financial institutions, shareholders, and communities where we operate for the significant impact they have had on the development of our values, mission and performance. This contribution is crucial to the success of the Inapa Group.
Diogo Rezende
CEO of Inapa Group
ANNUAL RESULTS ANNOUNCEMENT 2022 5
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02 Main Activity Indicators
(Amounts in Million Euros, except when specified otherwise)
2022 | 2021 | 2020 | 2019 | VAR.22/21 | |
Tonnes ('000) | 714 | 841 | 913 | 887 | -15,1% |
Sales | 1 211,7 | 964,6 | 1015,5 | 1030,8 | 25,6% |
Gross margin | 242,7 | 179,3 | 185,5 | 178,4 | 35,4% |
Gross margin (%) | 20,0% | 18,6% | 18,3% | 17,3% | 1,4 pp |
Net Operating costs | 154,7 | 146,2 | 156,6 | 148,6 | 5,8% |
Operating Income | 30,5 | 28,8 | 23,6 | 24,8 | 5,9% |
Operating Costs | 185,2 | 175,0 | 180,2 | 173,4 | 5,8% |
Impairment of trade receivables | 1,1 | 1,6 | 1,5 | 1,5 | -34,4% |
Re-EBITDA | 86,9 | 31,5 | 27,4 | 28,3 | 176,3% |
Re-EBITDA (%) | 7,2% | 3,3% | 2,7% | 2,7% | 3,9 pp |
Non recurrent costs | 10,8 | 0,7 | 11,6 | 1,6 | 10,2 |
EBITDA | 76,1 | 30,8 | 15,8 | 26,7 | 147,0% |
EBITDA (%) | 6,3% | 3,2% | 1,6% | 2,6% | 3,1 pp |
EBIT | 52,8 | 15,5 | -2,7 | 10,8 | 241,1% |
EBIT (%) | 4,4% | 1,6% | -0,3% | 1,0% | 2,8 pp |
Financial Function | 16,0 | 14,2 | 15,5 | 15,7 | 13,0% |
EBT | 36,8 | 1,3 | -18,2 | -4,9 | 35,5 |
Income Tax | -19,1 | 2,0 | 2,8 | 0,8 | -21,0 |
Net income | 17,8 | 3,3 | -15,5 | -4,1 | 14,4 |
31/12/22 | 31/12/21 | 31/12/20 | 31/12/19 | VAR.22/21 | |
Net debt | 221,1 | 261,8 | 315,0 | 337,3 | -15,6% |
Net debt/Re-EBITDA | 2,5 x | 8,3 x | 11,5 x | 11,9 x | -5,8 x |
Net debt excluding Trade Finance | 202,9 | 241,8 | 258,7 | 248,4 | -16,1% |
Interest coverage | 5,4 x | 2,2 x | 1,8 x | 1,8 x | 3,2 x |
Working capital | 35,8 | 11,4 | 73,0 | 87,6 | 215,1% |
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Inapa - Investimentos, Participações e Gestão SA published this content on 04 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 May 2023 00:42:02 UTC.