Madrid, September 24, 2018. In the first semester of the year, ADVEO obtained a negative net result of €18.3m due essentially to the lack of stock availability, linked to the refinancing process, as explained in the last 2 quarters. Results continue hampered by this issue, a circumstance that will be solved gradually, starting with the liquidity injection of €20 million via additional loan obtained from the financial entities.
On the other side, the company has agreed a sale option for its warehouse in Tres Cantos (Madrid) for €22 million.
In parallel, Staples Solutions B.V. has made a non-binding offer to the financial entities for the acquisition of the whole financial debt of the Company, in order to capitalize it. Such a transaction would imply the elimination of the Financial Debt, which would definitively solve the structural debt problem that the Company was dragging, and contribute to build a multichannel, leading group in Europe in the workspace solutions area.
On the results, revenue in the semester fell by 21.3% due to the lack of stock availability which penalized primarily the German and Spanish subsidiaries, that carries an inherent fall of 24.3% of Gross Margin.
As a consequence, EBITDA in 1S reached €2m, 72% less. Despite this severe situation, the continuous reduction of structural costs -€12.7m after the actions undertaken in Germany, France and Spain- has enabled ADVEO to maintain an EBITDA level in accordance with the budget.
Despite the difficulties due to the lack of stock, last quarter the company has made considerable progress in its the Strategic Plan 2017-2020. Thus, at the end of June ADVEO celebrated the European Partner Event 2018 in Paris. The event involved the presentation of the Group news regarding the new organizational and business model to approximately 100 distributors. In this same event Calipage new image was presented, which will be implemented progressively in the second half of the year.
On the other hand, ADVEO has continued progressing in the implementation of a new technological platform to adapt the business model to the current reality of the market and increase efficiency and competitiveness. In the last quarter, ERP in the French subsidiary has successfully gone live, and it joins the ones already implemented in Italy, Germany, Corporate Headquarters, and Shared Services Center.
In addition, ADVEO has launched a new demand management model (Sales & Operations Planning) to coordinate sales, logistics and procurement areas. This will allow the company to have better working capital levels.
Working capital during first semester, due partly to a lack of commercial credit, reached €57.2m, 20% less than in the same period last year. Net financial debt reached €146.7m, 2 less than in December but 9 million more than in the first semester 2017.