Ackermans & van Haaren NV: annual results 2007

 | Source: Ackermans & van Haaren Ackermans & van Haaren

  • AvH achieves a net profit of 241.4 million euros thanks to a strong increase (+43%) in the results of the participations
    • Dredging activities (DEME) achieve important growth in turnover and profit in a very active market
    • Real estate activities (Extensa and LRE) live up to expectations
    • Financial services: strong growth of assets under management, partly thanks to the acquisition by Bank Delen of Capfi,  and good commercial results for Bank J.Van Breda & C°
    • Private Equity: strong results in most of the participations
  • Increase (+20.87%) of gross dividend to 1.39 euros per share
The Board of Directors of Ackermans & van Haaren NV is pleased to announce that the consolidated net profit (part of the group) for the year 2007 amounts to 241.4 million euros, compared to the record profit over 2006 (influenced by the exceptional capital gain on the sale of Quick in an amount of 150.4 million euros)  of 307.6 million euros.



  


 


 


(*) based on the shares issued, adjusted for treasury shares in portfolio
 
 General comments on the figures
 
The AvH group achieved a consolidated net profit of 241.4 million euros in 2007 compared to the record result of 307.6 million euros in 2006.
 
This good result was achieved thanks to
  • strong profit contributions of the participations (183.2 million euros, being +42.8% compared to 2006), of which 10.8 million euros coming from the newly consolidated participations in Sipef and Henschel
  • capital gains within the Private Equity portfolio amounting to 18.1 million euros (mainly Corn.Van Loocke and UBF/EuroMedia) compared to 155.8 million euros in 2006 (mainly Quick)
  • good contribution from AvH & sub-holdings (9.4 million euros), partly due to 9.5 million euros capital gains on the sale of Agridec and KBC shares
  • the reversal of the largest part of the remaining GIB provisions (19.2 million euros)
  • other non-recurrent results including a capital gain of 5.5 million euros on the sale of Belfimas shares.
As of 31.12.2007, AvH's net cash position amounted to 363.6 million euros compared to 340.7 million euros as per the end of 2006. This position takes into account, on the one hand, the AvH investment portfolio (including Fortis and KBC shares) that was valued at 225.9 million euros (including unrealised capital gains of 130.4 million euros) as of 31.12.2007 (233.7 million euros as of 31.12.2006), liquidities and treasury shares amounting to 181.1 million euros and, on the other hand, the external financial debt, mainly in the form of commercial paper, amounting to 43.3 million euros. Furthermore, in the course of 2007, 248.2 million euros were invested and divestments took place in an amount of 37.9 million euros.
 
The following investments were made:
-154.0 million euros at the Private Equity level, of which
137.9 million euros of new investments (Distriplus, Spano, Iris, Manuchar);
16.1 million euros of follow-up investments (including Alural, UBF/EMG, Turbo's Hoet Group);
-94.2 million euros at the AvH-group level, of which
27.0 million euros of new investments (including Financière Duval, Rent-A-Port);
67.2 million euros of follow-up investments, of which 53.0 million euros for the capital increase by Finaxis in Bank Delen, in addition to increases in the participations in Sipef and Leasinvest Real Estate.
 
The (IFRS) consolidated net equity (part of the group) amounted to 1,580.1 million euros as of 31.12.2007 compared to 1,423.7 million euros as of 31.12.2006. The consolidated balance sheet total under IFRS increased to 4,888.0 million euros compared to 4,721.5 million euros as of 31.12.2006.
 
Comments relating to the most important group companies
 
CONTRACTING, DREDGING AND CONCESSIONS
Based on a continuously strong order book, DEME achieved a very high degree of activity with an almost full utilisation of the fleet.
The turnover in 2007 rose by 22% to 1,313.9 million euros (2006: 1,077.5 million euros) while operational cash flow (EBITDA) rose by 47% to 259.4 million euros (2006: 176.6 million euros) and net profits rose by 79% to 90.2 million euros (2006: 50.4 million euros).
These favourable developments in the results are due to excellent operational course of business and were hardly influenced by exceptional results. Notwithstanding a very active investment programme (460 million euros over 2005 - 2008), the net debt could be reduced to 362.4 million euros against a consolidated net equity of 410.6 million euros.
In the meantime, DEME has announced a new investment programme of approximately 500 million euros between now and 2011 in dredging ships and other maritime equipment that will provide DEME with a versatile, flexible and very competitive fleet.
The order book amounted to 1,811 million euros as of 31.12.07 (compared to 1,601 million euros as of 31.12.06) and is diversified across the different continents with new contracts, in amongst others France, Bulgaria, Russia, South Africa, Nigeria, Brazil, India, the United Arab Emirates, Australia and across the different specialities of the DEME group. Based on the existing order book and the new orders being tendered for, DEME expects to be able to achieve a growth in turnover and in operational profit for 2008.
 
RENT-A-PORT (AvH 45%) was incorporated in December 2006 by 2 former DEME executives as a port consultancy company.
In its first year of operations, RAP carried out studies primarily in West African countries and further developed its activities in Vietnam.
 
ALGEMENE AANNEMINGEN VAN LAERE achieved a decent result in a very competitive market (3.2 million euros vs. 4.3 million euros in 2006). Despite a difficult start in 2007, the order book was replenished to a sound level (187 million euros as of 31.12.07) with contracts in Luxembourg, Diegem, Courtrai, Beveren and Antwerp.
Van Laere wants to further concentrate on a number of specific niches and, also wants to operate more often in collaboration with other construction companies or financial groups within the context of "design, build & finance" projects, some of which in the form of a PPS.
 
N.M.P saw a significant increase in its result (6.3 million euros vs. 2.4 million euros in 2006) thanks to an exceptional capital gain. The current operational results were in line with previous years, thanks to the portfolio of long-term contracts.
 
REAL ESTATE AND RELATED SERVICES
The contribution of real estate activities remained relatively steady with a result of 27.1 million euros.
 
EXTENSA (AvH 100%, real estate development) again realised a strong result of 15.2 million euros (compared to 18.8 million euros in 2006) due to, on the one hand, the capital gains of 10.1 million euros on the sale of its participation in the first retail park in Romania (Targu Mures) and 5.75 million euros of positive changes in the fair value of Tour & Taxis and, on the other hand, 3.3 million euros from the sale of land.
 
Meanwhile, Extensa continues working on the development of the Tour & Taxis site in Brussels for which, in 2007, a building request was submitted, and of the Cloche d'Or site in Luxembourg, the master plan of which must be approved in 2008.
Joint ventures in Slovakia, Romania and Turkey should contribute further to the group result during the course of 2008. New permits are also expected within the land portfolio for the period 2008 - 2012 which should contribute to the recurrence of the results.
 
The real estate investment trust LEASINVEST REAL ESTATE (AvH: 30.01%) realised a net result of 33.4 million euros over the calendar year 2007 (compared to 29.5 million euros in 2006). This increase is explained by 11.9 million euros of positive changes in fair value within the real estate portfolio and capital gains of 5.8 million euros on the sale of 3 buildings in Belgium and 1 building in Luxembourg.
The fair value of the real estate portfolio amounted to 441.1 million euros as of 31.12.07 and incorporates a total surface area of 263,716 m², of which 70% is situated in Belgium and 30% in Luxembourg.
The quality of the portfolio is illustrated by the excellent occupancy rate of 97.74% and a rental yield of 7.21%.
 
COBELGUARD (AvH 40%) realised again strong growth in 2007 with an increase in turnover of 35% to 40.2 million euros and an increase in operational profit of 45% to 2.4 million euros. Cobelguard realised a number of commercial successes and continues to work on the development of new regions and services.
 
FINANCIERE DUVAL, in which AvH acquired a stake of almost 21% in March 2007, realised an increase of turnover of 22% to 261.3 million euros, and of its current operational result of 62% to 20.2 million euros. Development activities as well as the holiday parks operations (Odalys, NR 2 in France with 80,000 beds) and elderly homes (Residalya, 1,000 beds) contributed to this.
 
FINANCIAL SERVICES
BANK DELEN achieved noticeably strong growth in its assets under management in a very fluctuating stock market climate to 12,126 million euros (compared to 8,416 million euros as of 31.12.06), of which 2,747 million euros originated from the acquisition, in July 2007, of the Brussels based assets manager "Capital & Finance". This represents a net in-flow for Bank Delen which amounts to nearly twice the average of previous years. Thanks to this strong growth, the gross operational income was over 100 million euros (108.4 million euros) for the first time and the net profits rose by 22.4% to 36.7 million euros (30 million euros for 2006).
Notwithstanding the increase in personnel, the cost/income ratio remained stable at a very competitive 44.6%. The consolidated net equity of Bank Delen amounted to 246.0 million euros as of 31.12.07 (compared to 148.7 million euros as of 31.12.06), of which 60 million euros originated from the capital increase at the occasion of the acquisition of Capfi.
At the beginning of 2008, Bank Delen was nominated "Best Private Bank" in Belgium by Euromoney for the second consecutive  time.
Despite a great deal of turbulence in the financial markets, Bank Delen hopes that the growth in assets under management over the last years and the integration of a complete financial year of Capfi will contribute to an increase of the recurrence and growth of the results.
 
BANK J.VAN BREDA & C° realised a strong commercial performance in 2007. The assets invested by clients grew by 624 million euros (+ 15% to 4,701 million euros) and the loan portfolio increased by 17% (to 1,755 million euros). The volume of off balance-sheet investments grew by 16% to 2,802 million euros both in the areas of asset management (+17%) and life insurance investments (+19%).
 
This record growth could, however, not compensate for the decrease in profits due to the unfavourable interest climate. The net consolidated result amounted to 22.4 million euros, against 24.4 million euros in 2006 (-8%). In the first half of the year, the profit decreased by 17%. However, in the second half of the year, profits grew +3% compared to the second half of 2006.
The bank's investment portfolio was not in any way affected by the crisis in the financial markets. The amounts written off on the loan portfolio remain at a very low level (0.13% of the average loan portfolio). The portfolio of inland shipping clients acquired from the Ethias Bank was integrated successfully.
 
Notwithstanding the considerable investment in strengthening the commercial organisation, the cost/income ratio remained stable at 58%. As of 31.12.07, the net equity amounted to 207 million euros, representing a solvency ratio of 11.8%. Despite the fact that for 2008 the interest climate outlook is again unfavourable, it is expected that the interest income will increase slightly. Unless there would be unexpected negative evolutions in the market interest rates or in the provisions for credit losses, Bank J.Van Breda & C° is hopeful that its strong commercial positioning will enable it, in 2008, to accelerate the growth in profits which began in the second half of 2007.
 
Other participations
As a result of the shareholders agreement which was concluded early 2007 with the family Bracht, the participation in SIPEF in 2007 was consolidated for 18.80%.  In November 2007, this participation has been increased up to 19.55%. Thanks to the higher palm oil prices, turnover increased by 28% to 209.5 millions USD. These higher prices, together with an efficient cost control, resulted in more than a doubling of the net profit of 22.1 millions USD (2006) to 48.1 millions USD (2007).  Meanwhile, Sipef continues to work on the extension of its rubber and oil palm plantations in Indonesia and Papua-New Guinea.
 
HENSCHEL, in which AvH holds 50%, is consolidated for the first time, due to the increase in its size. Henschel produces telescopic arms and other accessories for cranes, as well as loading platforms of light trucks. The company, with locations in Belgium and Poland, achieved a consolidated turnover of 62.7 million euros (-2% compared to 2006 (fiscal year 15 months)) and a net profit of 8.5 million euros (+25% compared to 2006 (fiscal year 15 months)).
 
PRIVATE EQUITY
The current contribution of "Private Equity" achieved a substantial increase in 2007 of 75% to 47.2 million euros (2006: 26.9 million euros), including a capital gain of 7.6 million euros on the sale of 617,676 shares Telenet.
Within the Private Equity-portfolio, capital gains of 18.1 million euros (AvH part) were also achieved, of which 3.1 million euros were on the sale of the stake in Corn. Van Loocke and 14.9 million euros on the contribution of UBF to the new EuroMediaGroup.
 
A few remarkable performances within the portfolio:
  • ATENOR (Sofinim 12.01%) realised a very strong year with a net profit of 35.4 million euros thanks to the profit on 2 projects in Luxembourg (Président-Pixel).
  • HERTEL (Sofinim 36%) realised an increase in turnover of 28% to 671.0 million euros and an increase in net profits of 136% to 22.0 million euros due to a good operational course of business in all its departments.
  • OLEON (Sofinim 37.07%) realised a net profit of 23.0 million euros and a turnover of 416.4 million euros, despite the fire that hit the factory in Ertvelde in January 2007. This result includes of course the damages that were paid by the insurer.
  • SPANO INVEST (Sofinim 72.92%) realised an important first contribution thanks to a net profit of 17.2 million euros on a turnover of 270.7 million euros, based primarily on a strong first half of the year in 2007.
  • TURBO'S HOET GROUP (Sofinim 50%) contributed for the first time for an entire year and realised a strong increase in turnover (+25% to 317.9 million euros) and a net profit (+79% to 11.4 million euros) thanks to the high degree of investment in the truck sector. In 2007, Turbo's Hoet Group has managed to extend significantly its activities in renting trucks and sale of trucks and parts in Bulgaria and Russia.
  • In 2007, GROUPE FLO (GIB 46.7%) opened 20 Hippos, 5 brasseries and 3 tabla-pizza restaurants, and now has a total of 184 restaurants. With this, Groupe Flo realised a turnover of 380 million euros (+9% vs. 2006: 348.5 million euros) and a net profit of 19.0 million euros.
  • With the merger of UBF (Sofinim 47.3%) with the French group Euromédia Télévision, the new EuroMediaGroup (EMG) was created. This way, EMG has become the European market leader in television facilities with a turnover (pro forma 2007) of 268.2 million euros and an EBITDA of 49.7 million euros. EMG can offer to its clients 80 studios, a fleet of 45 mobile Outside Broadcast trucks (of which 16 in HD), 93 postproduction units and 83 ENG units. Sofinim has a 22% participation in EMG, along with Bolloré, Allianz Capital Partners and the family Barry.
Within Private Equity, Sofinim and GIB had an active investment year in which 154 million euros were invested and 29.3 million euros were divested:
 
- 137.9 million euros of new investments. Apart from Spano Invest (see above), investments were made in:
  • IRIS (June 2007): participation of 6.12% acquired at the occasion of a capital increase of 10 million euros for which Sofinim subscribed in an amount of 5 million euros. Iris is an important European player in Optical Character Recognition (OCR), intelligent document recognition (IDR) and document management. For 2007 Iris expects an increase of turnover to 95 million euros (+16% compared to 2006).
  • MANUCHAR (June 2007): participation of 20%. Manuchar, historically a trading company, develops itself into a logistics player and distributor active in steel and chemicals, among other things, via a network of affiliates spread over 23 growth countries in Latin America, Africa, the Middle East and Asia. Manuchar realised a turnover of 571.7 million euros in 2007 for an operational result of 24.3 million euros and a net profit of 8.6 million euros.
  • DISTRIPLUS (July 2007), together with CNP, each for 50%. Distriplus encompasses the specialised retail chains CLUB (27 shops), Planet Parfum (71 shops) and Di (90 own shops and 40 franchises). In the second part of 2007 these chains realised a joint turnover of 130.2 million euros and an operational result of 3.1 million euros.
- 16.1 million euros follow-up investments, primarily in Alural, UBF/EMG and Turbo's Hoet Group
 
The adjusted net asset value of the Private Equity portfolio, including unrealised capital gains on the listed shares held by Sofinim and on Groupe Flo amounted to 478.7 million euros as of 31.12.2007 (compared to 631.5 million euros as of 31.12.2006, at that moment still including Quick for 211 million euros).
 
 
Prospects 2008
Except in case of unforeseen circumstances, the Board of Directors again expects a strong contribution to the group result of most of its participations.
 
Calendar 2008
15 April 2008                        annual report available online www.avh.be
26 May 2008                        annual shareholders'meeting and quarterly update Q1 2008
4 June 2008                         payment of dividend
28 August 2008                    announcement of the semestrial results 2008
6 March 2009                       announcement of the annual results 2008
 
Declaration by the Auditor
The auditor has confirmed that his review of the consolidated annual accounts has been completed and that no meaningful corrections have come to its attention that would require an adjustment to the accounting information included in this press release.
Antwerpen, March 6th 2008
 
Ernst & Young Bedrijfsrevisoren BCV
represented by
Patrick Rottiers                       Christel Weymeersch
Partner                                   Partner
 
 
Ackermans & van Haaren is a diversified group active in 4 key sectors: contracting, dredging and concessions (DEME, one of the largest dredging companies in the world - Algemene Aannemingen Van Laere, a leading contractor in Belgium), Real Estate and related services (Leasinvest Real Estate, a listed real-estate investment trust with real estate assets of approximately  450 million euros - Extensa, an important land and real estate developer focused on Belgium, Luxemburg and Central Eurospe), private banking (Bank Delen, one of the largest independent private asset managers in Belgium - Bank J.Van Breda & C°, niche bank for entrepreneurs and liberal professions) and private equity (Sofinim, one of the largest private equity providers in Belgium, and GIB).
The group concentrates on a limited number of strategic participations with an important potential for growth. Market capitalisation of AvH is approximately 2.2 billion euros. The AvH share has been included in the reference index BEL20 and the Private Equity NXT index of Eurosnext Brussels.
 
New website
All press releases issued by AvH and its most important group companies as well as the 'Investor Presentation' can also be consulted on the totally renewed AvH website: www.avh.be.
Anyone who is interested to receive the press releases via email has to register again to this website, under the 'News' section.
 
 
For further information please contact:
Luc Bertrand                                                               
CEO - President of the Executive Committee                
tel: +32.3.231.87.70                                                    
e-mail :  dirsec@avh.be                                    
 
Jan Suykens
Member of the Executive Committee
tel: +32.3.897.92.36
e-mail : dirsec@avh.be
 
 
Annex: see attached PDF

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