1. HIGHLIGHTS FROM FIRST NINE MONTHS OF 2018:
- Sonae turnover increased 7% to 4,236 M€, with a growth of all business units
- Profitability improves, with Sonae underlying EBITDA rising 3.5%
- Sonae net income grew from 133 M€ to 200 M€
- Investment reached 480 M€
Ângelo Paupério, Sonae Co-CEO, states: "In the first nine months of 2018, Sonae continued to deliver a solid set of results across its portfolio of businesses. Consolidated turnover growth stood at 7% year-on-year, with positive contributions from all business units, and underlying EBITDA increased 3.5% to 233 million euros. Net income grew 50% to 200 million euros driven by a strong increase in indirect income.
In the third quarter, Sonae MC continues to be worth highlighting, both due to the strong turnover growth and to profitability stabilizing at benchmark levels. During this period, the reorganization of participations and restructuring of the new perimeter of this business unit was completed, achieving the objectives of autonomy and agility, and allowing it to operate with a governance model fully aligned with the best practices of listed companies. Unfortunately, Sonae chose in October to withdraw its intention to float Sonae MC, due to particularly adverse market conditions.
Equally relevant and also in this quarter, Sonae completed the 20% stake acquisition of Sonae Sierra, an important milestone to increase the international profile of the group by reinforcing its participation and influence over this leading player in the retail real estate sector. Notwithstanding this acquisition and the consolidation of Sonae Sierra’s balance sheet, Sonae continued to strengthen its capital structure and reduce its gearing levels.
” 2. CONSOLIDATED ANALYSISAll business units boost growth
From a statutory point of view, Sonae consolidated turnover increased 7.0% versus last year to 4,236 M€ fuelled by another good quarter (+7.7% of turnover growth) from all consolidating businesses.
Sonae EBITDA amounted to 270 M€ in 9M18, +1.7% y.o.y., benefiting from a 3.5% increase of the underlying EBITDA coupled with an even better evolution in equity method results, which grew 29.6% y.o.y. to 47 M€.
Indirect result reached 114 M€ in 9M18, with a highlight to a capital gain of 46 M€ in resulting from the acquisition of a further 20% stake in Sonae Sierra.
Net income group share jumped from 133 M€ to 200 M€ in 9M18, impacted by rise of sales and profitability as well as indirect results.
Investment amounted to 480 M€, relating to the 20% acquisition in Sonae Sierra and the fulfilment of store openings and refurbishment plan. Debt reduced by 144 M€ on a comparable basis
Sonae strengthened its financial performance, with net debt amounting 1.539 M€ at the end of 9M18, including the acquisition of 20% in Sonae Sierra for 256 M€ and the consolidation of the company’s net debt. Looking at pro-forma figures, i.e. including the full consolidation of Sonae Sierra’s net debt at the end of 9M17, Sonae net debt would have decreased 144 M€ (or 10.1%) y.o.y., to 1,283 M€.
Sonae’s average gearing at both book and market value stood at 0.6x, a slight decrease when compared to 3Q17, and the group’s capital structure was further reinforced and is now composed of 67% equity, a 4.0 p.p. (already with Sonae Sierra’s balance sheet fully consolidated) increase vs last year.
Moreover, Sonae was able to maintain a low average cost of debt outstanding (1.0% in the 9M18) with an average maturity profile of 3 years.Over 2,000 jobs created and 900 social institutions supported
Sales growth among the business units, in Portugal and abroad, has contributed to reinforce operational teams. Therefore, Sonae has created over 2,000 jobs during the last 12 months, having ended the first nine months of the year with over 45,000 employees.
Sonae also strengthened its commitment to the community, having supported about 900 solidarity institutions across Portugal, through material goods, skills and financial resources. Among the areas benefiting from Sonae's support were Social Solidarity, Culture, Education, Environmental Awareness and Health and Sport.