Quadient SA - Quadient reports solid revenue growth in Q4 2022 and an improved current EBIT margin of 15.2% in H2 2022. Organic growth in current EBIT expected at c.10% in 2023.
27/03/2023 16:58
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Quadient reports solid revenue growth in Q4 2022 and an improved current EBIT
margin of 15.2% in H2 2022. Organic growth in current EBIT expected at c.10%
in 2023.
Key highlights
*
* Consolidated sales of €1,081 million, up +5.6% on a reported basis and up
1.4% organically0F(1)
* Full-year subscription-related revenue up 3.1% on an organic basis,
representing 69% of total revenue
* Strong Q4 revenues at +3.1% organically, with all three Solutions and all
geographies posting organic growth
* Current EBIT1F(2) of €150 million up 2.2% on a reported basis and down
4.8% organically(3). Current EBIT(2) margin stable y-o-y at 14.3%, excluding
the €5 million negative impact of IFRIC accounting change, supported by a
strong improvement in H2 at 16.1% excluding IFRIC
* Net attributable income of €13 million, impacted by €70 million of
non-cash one-off items, mostly from impairment of goodwill and real estate
write-offs
* Robust free cash flow2F(4) of €70 million despite the higher level of
financing of leased equipment for customers vs. 2021
* Net debt reduced to €722 million as of 31 January 2023, leading to a
lower leverage at 1.8x excluding leasing4F(5)
* Group successful evolution translates into simplified reporting with the
publication of current EBIT(2) by Solution
* Proposed dividend of €0.60 per share, up 9%
y-o-y in respect of the fiscal year 2022
*
FY 2023 guidance confirms the 2021-23 financial outlook
* 2023 organic revenue growth expected at c.3% compared to FY 2022. For the
period 2021-23, the expected organic CAGR in revenue is confirmed at a minimum
of 3%.
* 2023 current EBIT(2) organic(3) growth expected at c.10%, confirming the
mid-term outlook of a minimum mid-single-digit organic CAGR(6) in current
EBIT(2) for the period 2021-23.
Paris, 27 March 2023,
Quadient S.A. (Euronext Paris: QDT), a leader in business solutions for
meaningful customer connections through digital and physical channels,
announces today its 2022 fourth-quarter consolidated sales and full-year
results (period ended on 31 January 2023). The full-year 2022 results were
approved by the Board of Directors during a meeting held on Friday
24 March 2023.
Geoffrey Godet, Chief Executive Officer of Quadient S.A., stated: “As we
continue to make progress in the execution of our Back to Growth strategy,
this year’s results benefited from a strong finish, demonstrating
Quadient’s ability to reposition itself on core markets and geographies,
adapt its business to a recurring subscription model while investing in
solutions recognized for their leadership. This year, we posted a moderate but
positive annual organic revenue growth, with a particularly robust Q4 across
all solutions, while the operating profitability showed a marked improvement
in H2 vs H1. Our cloud Software Solution performed strongly with a more than
20% record organic growth in Annual Recurring Revenue, driving double-digit
organic growth in subscription-related revenue. With the transition from
license sales to SaaS subscription nearly completed, this revenue growth is
now reflected in an improving profitability trend, as already seen in the
second part of the year. Mail-Related Solutions achieved a stunning
performance in posting organic growth for the second consecutive year, while
succeeding to maintain a high level of profitability. In addition,
Mail-Related Solutions delivered strong hardware sales levels and benefitted
from record cross sell between Quadient’s mailing equipment customers and
its Software Solutions. Finally, Parcel Locker Solutions showed attractive
growth in our European geographies while the overall performance was impacted
by a high comparison basis in Q1 as well as delays in retail and residential
projects in the US.
Two years into the second phase of our strategic plan, we have reached a
turning point in the evolution of the Group with the divestments of the
remaining non-core activities, leading to the end of the Additional Operations
segment and the simplification of our financial reporting. We continue to
leverage our unique state-of-the-art software and smart hardware platform to
drive the synergistic development of the entire Group and achieve our
medium-term ambitions. Our integrated and subscription-based business model is
proving very resilient in the current macro context and our ability to
cross-sell and upsell our comprehensive product range to our more than 440,000
enterprises and SMB customers makes the Group uniquely positioned to continue
to grow its top line while also delivering improved profitability.”
A SOLID Q4 PERFORMANCE DRIVES 1.4% ORGANIC REVENUE GROWTH IN FY 2022
Group sales stood at €1,081 million in FY 2022, a 1.4% organic growth
compared to FY 2021 and a 5.6% increase on a reported basis. The variation
includes a positive currency impact of +6.2% or €64 million and a negative
scope effect of (2.1)% or €(21) million. The changes of scope are related
to the acquisition of Beanworks in March 2021, the divestment of Automated
Packaging Systems in July 2021 as well as the more recent divestments of the
Graphic activities in the Nordics and the Shipping business in France (both in
June 2022).
Segment reporting evolution and accounting changes
The sale of the Graphics activities in the Nordics and of the Shipping
business in France have completed the reshaping of the Additional Operations
portfolio. The remaining activities in the Additional Operations segment were
mostly related to Mail-Related Solutions and Parcel Locker Solutions
activities in non-core geographies, which are now being integrated into the
existing Solutions activities starting at the FY 2022 reporting.
The end of the Additional Operations segment has led the Group to re-organise
its segment reporting based on an approach by Solution rather than the prior
approach by geographies. Consequently, the Group will now provide, in addition
to the revenue by Solution, the associated current EBIT((2)). Details of the
new reporting segments are being provided starting in FY 2022 and a pro forma
FY 2021 is also shown for comparison basis.
Aside from the simplification effort in segment reporting, the FY 2022 current
EBIT(2), both at the Group and at Solution levels, was impacted by the new
IFRIC accounting standard on Cloud Software investments. At Group level, the
FY 2022 negative impact on current EBIT(2) was €(5) million.
Consolidated sales and current EBIT(2) by Solution
Consolidated Sales
In € million FY 2022 FY 2021 pro forma ((a)) Change Organic change (1)
Intelligent Communication Automation 227 201 +12.8% +6.3%
Mail-Related Solutions 757 710 ((a)) +6.7% +0.1%
Parcel Locker Solutions 91 86 ((a)) +5.6% +0.4%
Other solutions divested in 2022 5 27 ((a)) (80.4)% +12.5%
Group total 1 , 081 1 , 024 +5.6% +1.4%
(a) Mail-Related Solutions and Parcel Locker Solutions now includes activities previously accounting for in Additional Operations.
Current EBIT((a)) and EBIT Margin ((a))
FY 2022 (Including new 2022 IFRIC) FY 2022 ( Ex cluding new 2022 IFRIC) FY 2021 pro forma ((b)) (no IFRIC impact)
In € million Current EBIT ((c)) EBIT Margin ((c)) Current EBIT ((c)) EBIT Margin ((c)) Current EBIT EBIT Margin
Intelligent Communication Automation (10) (4.5)% (9) (4.1)% (3) (1.6)%
Mail-Related Solutions 186 24.5% 189 25.0% 171 24.1%
Parcel Locker Solutions (25) (27.8)% (25) (27.4)% (19) (22.0)%
Other solutions divested in 2022 (0) (5.3)% (0) (5.3)% (2) (8.6)%
Group total 150 13.9% 15 5 14.3% 147 14.3%
(a) Before acquisition-related expenses
(b) Mail-Related Solutions and Parcel Locker Solutions now includes
activities previously accounting for in Additional Operations.
(c) 2022 current EBIT and EBIT margin were negatively impacted by the
€5 million negative impact from the new IFRIC accounting standard for cloud
computing
Intelligent Communication Automation
Sales from Intelligent Communication Automation were up 6.3% organically and
12.8% on a reported basis to €227 million. Subscription-related revenue
continues to grow at a double-digit rate closing the year on an 18.5% organic
growth. Q4 marked a further acceleration of the organic growth trend reaching
22.1% for the quarter. Record year for cross selling software modules to
Mail-Related Solutions customers and several large subscription deals
(>€1 million/year each) signed in 2022 have both contributed to this solid
performance. It is also worth highlighting the fast organic increase in
revenues delivered by Quadient’s Account Receivables and Account Payables
modules growing at over 50% for the FY 2022. Overall, demand for Quadient’s
cloud-based offering has remained strong throughout FY 2022 with each quarter
of the year posting a double-digit organic increase in subscription-related
revenue, which now accounts for 75% of Intelligent Communication Automation
total sales in 2022 compared to only 67% in FY 2021.
The share of SaaS customers reached 80% at the end of FY 2022, a further
increase compared to 76% in FY 2021, also highlighting the progress made in
the change in business model from license sales to a cloud-based offer. Annual
recurring revenue set a new record, reaching €187 million at the end of FY
2022, up from €145 million at the end of FY 2021, representing a 22%
organic increase(7). Annual recurring revenue is a forward-looking indicator
of future subscription-related organic growth, which is expected to further
accelerate in FY 2023.
With the strong increase in Subscription-related revenue, the weight of
license sales continues to decrease, now only representing 8% of total
Solution sales. License sales decreased by 37.6% organically in FY 2022
bringing the transformation of the business model close to completion. The
negative impact of this transition on the Solution growth should therefore be
more limited going forward. Professional services were slightly down
organically, by 5.4%, professional services revenue being directly linked to
the evolution in product mix.
Current EBIT(2) for Intelligent Communication Automation was negative at
€(10) million, leading to an EBIT margin(2) of (4.5)%. The operating
profitability of Intelligent Communication Automation was mainly impacted in
the first half of the year by the high inflation weighing on personnel costs,
a return to normalised marketing expenses post-Covid and additional costs
linked to the launch of new modules in selected European countries. The second
half of the year showed a marked improvement in current EBIT(2) with an EBIT
margin moving from (9.7)% in H1 to 0.2% in H2 thanks to the increase in
revenue and in gross margin as well as to a tight cost control, lower impact
from salary inflation and reduced travel expenses. Furthermore, the on-going
change in business model continues to impact the Solution profitability,
whereas H1 2022 was also impacted by a high comparison basis due to a large
license deal signed in Q2 2021.
Current EBIT(2) for the Solution is expected to improve in FY 2023 driven by
the rising profitability of the installed base, the contribution from the
phasing of the prices increases and the contribution from the growing revenue.
In addition, the negative impact from the change in business model should
continue to decline thanks to the lower weight of license sales in the revenue
mix.
Mail-Related Solutions
Mail-Related Solutions sales reached €757 million in FY 2022, up 6.8% on a
reported basis and slightly up organically (+0.1%). Revenue from Mail-Related
Solutions now includes former Additional Operations Mail activities in
non-core geographies for €51m. This is the second consecutive year of
organic increase, a remarkable performance for Mail-Related Solutions as it
comes against a high comparison basis (a 1.8% organic growth in the FY 2021)
and while the second half of the year was impacted by supply chain disruption.
Looking at the geographic contributions, this outstanding performance was
mostly driven by organic growth from North America (both subscription-related
revenue and license & hardware sales), while the Main European countries
showed contrasted contributions.
The solid performance in hardware sales also continued with a 4.3% organic
increase in FY 2022, fuelled by a very strong Q4 at +9.1% organic growth.
Quadient’s strategy to renew its product offering is bearing fruits with an
increasing penetration of the new generation of products. The share of the
upgraded installed base is reaching 19.9% at the end of FY 2022, vs 11.7% at
the end of FY 2021. Placement of remanufactured mailing equipment is also
gathering pace with the remanufacturing level reaching 73% at the end of the
year, well ahead of the 50% level targeted by the Group for 2023.
Subscription-related revenues (69% of Mail-Related Solutions sales) recorded a
limited 1.7% decline in FY 2022. This solid performance is driven by both the
resilience of the installed base and the multi-year largely indexed contracts.
Current EBIT(2) for Mail-Related Solutions was €186 million for FY 2022
including a c.€(3) million negative impact from the new IFRIC accounting
standard for cloud computing. Current EBIT margin for FY 2022 was 24.5%. The
high profitability level of Mail-Related Solutions is even more remarkable
given the high inflationary environment as well as still high freight costs.
Record cross-selling of Intelligent Communication Software leading to
increased costs synergies, strong focus on costs control, continuous increase
in remanufacturing placements and the benefit from the indexation have all
contributed to this solid performance.
Current EBIT(2) for the Solution is expected to remain solid in FY 2023
supported by a tight focus on cost control, a positive outlook in North
America and further penetration of new generation mail equipment.
Parcel Locker Solutions
Parcel Locker Solutions sales increased by 5.6% to €91 million in FY 2022,
a 0.4% organic increase compared to FY 2021. FY 2022 revenue includes Lockers
activities in non-core geographies from the former Additional Operations
segment for €4 million.
License and hardware sales were down 12.6% organically in FY 2022 impacted, on
the one hand, by an unfavourable comparison basis linked to the final phase of
the deployment of a large North American retail contract in Q1 2021, and, on
the other hand, by the delays in retail and residential projects in the US.
Subscription-related revenues were up 10.0% organically supported by the
deployment of existing contracts, solid usage rate (standing at 64% at the end
of FY 2022) and the benefits from price increases on the installed base.
Subscription-related revenue stands at 59% of total revenue for Parcel Locker
Solutions.
The deployment of a new open network of lockers in the UK, launched in June
2022, is gathering momentum. DPD, DHL and Evri have all officially announced
that they will use the network for the delivery of their volumes, while a
fourth carrier has recently also joined the network. The targeted number of
installed lockers is set at 5,000, to be deployed in the coming years.
Quadient’s global installed locker base reached 18,000+ units at the end of
FY 2022.
Current EBIT(2) for Parcel Locker Solutions was negative at €(25) million
in 2022, with a current EBIT margin of (27.8)%. Current EBIT margin for the
existing installed base was 12.5% vs 11.3% a year ago. Profitability in 2022
has been impacted by several one-off factors, namely:
i) Increased costs associated with the development and the launch of new
products,
ii) Go-to-market and initial deployment costs associated with the new UK
open-network, and
iii) Delays in retail deals and residential installations in the US.
Profitability is expected to increase in FY 2023 supported by declining
freight costs, lower costs associated with product launches and the UK open
network as well as the rising profitability of the installed base and benefits
from the phasing of price increases.
Consolidated sales by geographies
In € million FY 2022 FY 2021 Pro forma Change Organic change (1)
North America 599 519 +15.4% +3.0%
Main European countries ((a)) 372 376 (1.0)% (1.4)%
International ((b)) 110 128 (14.7)% +3.6%
Group total 1,081 1,024 +5.6% +1.4%
(a) Including Austria, Benelux, France, Germany, Ireland, Italy, Switzerland, and the United Kingdom. (b) International includes the activities of In telligent Communication Automation , Mail-Related Solutions and Parcel Locker Solutions outside of North America and the Main European countries as well as divested other solutions previously recorded under Additional Operations .
Sales in North America (55% of Group sales) were up 3.0% organically to
€599 million and 15.4% on a reported basis. Solid hardware sales for
Mail-Related Solutions as well as a strong performance from Intelligent
Communication Automation were the main contributors to the growth in the
region. Penetration of Quadient’s cloud-based solutions continues to be well
supported by successful cross-selling with two-thirds of new Software
customers coming from the Mail customer base. Quadient’s Account Receivables
and Account Payables solutions also performed well in the region contributing
to the overall solid performance for the year. Parcel Locker Solutions,
however, suffered from both delays in the deployment of retail and residential
projects and from a high comparison basis with the completion of the roll-out
of a large retail contract in Q1 2021.
Main European countries (34% of Group sales) were marginally down by 1.4% on
an organic basis to €372 million. Performance has been contrasted by
countries and by Solution in this region. Mail-Related Solutions performed
well in terms of hardware sales in most European countries except for France.
For Intelligent Communication Automation, penetration of the recently launched
Account Receivables and Account Payables modules have started to contribute to
the growth in the region but the decline in license sales due to the change in
business model continues to impact the overall growth. Parcel Locker Solutions
was the main contributor to growth in the region (+c.50% on an organic basis),
benefiting from the on-going deployment of the recently signed contracts most
notably in France.
The International segment (10% of Group sales) delivered a 3.6% organic
growth, to €110 million, mostly driven by the good dynamics of both
Intelligent Communication Automation and Parcel Locker Solutions.
Q4 2022 SALES
Consolidated sales stood at €288 million in the fourth quarter of 2022, up
5.5% on a reported basis and 3.1% on an organic basis compared to the fourth
quarter of 2021. A solid performance driven by all three Solutions and all
geographies, demonstrating an acceleration of the revenue growth trend through
the year.
In € million Q4 2022 Q4 2021 Pro forma Change Organic change (1)
Intelligent Communication Automation 61 54 +13.1% +9.0%
Mail-Related Solutions 202 193 +4.9% +0.9%
Parcel Locker Solutions 25 23 +9.6% +7.5%
Other solutions divested in 2022 0 4 (100)% (100)%
Group total 288 273 +5.5% +3.1%
Intelligent Communication Automation sales were strongly up with 9.0% organic
growth to €61 million after a slower Q3 2022, the Subscription-related
revenue showing the strongest organic growth of the year at +22.1%, more than
offsetting the decline in license sales.
Mail-Related Solutions sales continued to show strong resilience, reaching
€202 million, up by 0.9% on an organic basis benefiting from the reduction
of the backlog despite further supply chain issues.
Parcel Locker Solutions sales stood at €25 million in Q4 2022, with a +7.5%
organic growth compared to Q4 2021 thanks to the ongoing deployment of
existing contracts in France and the UK.
In € million Q4 2022 Q4 2021 Change Organic change (1)
North America 157 141 +10.9% +2.8%
Main European countries ((a)) 101 99 +2.3% +2.6%
International ((b)) 30 32 (8.2)% +5.8%
Group total 288 273 +5.5% +3.1%
(a) Including Austria, Benelux, France, Germany, Ireland, Italy, Switzerland, and the United Kingdom. (b) International includes the activities of Intelligent Communication Automation, Mail-Related Solutions and Parcel Locker Solutions outside of North America and the Main European countries.
North America posted 2.8% organic growth in the quarter, with a double-digit
growth in Intelligent Communication Automation and Mail-Related Solutions
posting positive organic growth.
Main European Countries posted a 2.6% organic growth, fuelled by a remarkable
performance of both Mail-Related Solutions and Parcel Locker Solutions, the
latter benefitting from the development of the recent contracts in France.
International grew +5.8% organically with all solutions contributing to the
growth.
REVIEW OF 2022 FULL-YEAR RESULTS
Simplified P&L
In € million FY 2022 (including IFRIC) FY 2021 (No IFRIC impact) Change
Sales 1,081 1,024 +5.6%
Gross profit 790 744 +6.2%
Gross margin 73.1% 72.6%
EBITDA 240 245 (2.0)%
EBITDA margin 22.2% 23.9%
Current operating income before acquisition-related expenses 150 147 +2.2%
Current operating income margin (before acquisition related expenses) 13.9% 14. 3 %
Current operating income 140 135 +3.5%
Optimization expenses and other operating income & expenses (73) (19) n.m.
Operating income 6 7 116 ( 42.6 ) %
Financial income/(expense) (36) (8) n.m.
Net attributable income 1 3 88 ( 8 4.9 )%
Earnings per share 0.29 2.32
Diluted earnings per share 0.29 2.17
Gross margin improved to 73.1% in FY 2022 compared to 72.6% in FY 2021. A
solid performance achieved in difficult conditions with the high inflation
level impacting all costs aspects and freight costs still at elevated levels.
Tight cost control as well as the positive business development and price
increases all contributed to this improvement in gross margin.
Current operating income before acquisition-related expenses increased to
€150 million in FY 2022 compared to €147 million in FY 2021, up 2.2% on
a reported basis and down 4.8% on an organic(3) basis. The current operating
income before acquisition-related expenses includes a €5 million negative
impact from the new IFRIC rule for cloud computing. Current operating margin
before acquisition-related expenses stood at 13.9% of sales in 2022 compared
to 14.3% in 2021. Excluding the negative IFRIC impact, the current operating
margin before acquisition-related expenses would have been stable year over
year at 14.3%. The Group’s operating profitability was impacted by higher
personnel costs, increased R&D, and go-to-market spendings. Investments into
scaling the network of parcel lockers with the launch of the UK open network
also weighed on profitability as well as the recent delays in retail and
residential lockers projects in the US. Price increases through the year, the
benefit of indexation for part of the Group’s installed base as well as
tight cost control helped mitigate these negative elements. As anticipated, H2
current EBIT margin showed a marked improvement versus H1 2022 level, at 16.1%
excluding IFRIC vs 12.5%. The solid H2 performance was driven by all three
Solutions with notably Intelligent Communication Automation showing strong
recovery while Mail-Related Solutions managed to further improve an already
high level of profitability.
With no significant M&A activities in FY 2022, acquisition-related expenses
declined slightly to €10 million in FY 2022, compared to €12 million in
2021. Consequently, current operating income stood at €140 million in 2022
including the negative IFRIC impact, compared to €135 million in FY 2021.
Optimization costs and other operating expenses stood at €73 million in FY
2022, versus €19 million in FY 2021. In particular, this included:
i) Goodwill impairment for €48 million, resulting from the WACC
increase in UK, Ireland and DACHIT regions and tax rate increase in the UK
ii) Real estate write-offs linked to the optimisation of the office
footprint for a total amount of €16 million
Including these non-current items, operating income for FY 2022 was
€67 million, versus €116 million recorded in FY 2021.
Net attributable income
2022 net cost of debt was marginally up year-on-year at €27 million,
against €25 million in FY 2021. The increase is mainly due to the
refinancing of the ODIRNANE instrument, which was booked in equity, through
the emission of Schuldschein debt in November 2021.
The currency gains & losses and other financial items were a loss of
€9 million in 2022 versus a gain of €17 million in FY 2021. This is
partly due to a decrease of €5 million in the fair value of the investment
made by Quadient in private equity funds X’Ange 2 and Partech Entrepreneurs
while, in FY 2021, currency gains and other financial items benefited from the
€20 million increase in the fair value of these investments.
Overall, net financial result was a loss of €36 million in FY 2022 compared
to a loss of €8 million in FY 2021.
Income tax decreased to €16 million in FY 2022 versus €20 million in FY
2021. This is mainly due to the favourable impact of a tax loss carry forward
recognition, partly offset by an increase in the tax charge in the United
States.
The corporate tax rate stood at 54.8% in FY 2022 compared to 18.1% in FY 2021.
This high rate is mainly owing to the impairment of goodwill recorded this
year. Restated for this item, the corporate tax rate would be 21.4% and marks
a return to a more normal level.
Net attributable income after minority interest amounted to €13 million in
FY 2022 compared to €88 million in FY 2021.
Earnings per share(8) stood at €0.29 in FY 2022 compared to €2.32 in FY
2021.
Proposed dividend at €0.60 per share for the FY 2022, a 9% increase against
the FY 2021 dividend. The dividend is subject to approval by the Annual
General Meeting, scheduled for 16 June 2023, and will be paid in cash in one
instalment on 7 August 2023.
Cash flow generation
EBITDA9F(9) was €240 million in FY 2022 compared to €245 million in FY
2021. EBITDA margin decreased from 23.9% in FY 2021 to 22.2% in FY 2022.
Excluding the negative IFRIC impact, EBITDA margin for the FY 2022 would have
been 22.7%. The decline in EBITDA margin was mainly due to increased go to
market efforts to support the Group’s growth engines, product launches in
new geographies as well as the impact from salary inflation.
The change in working capital was negative by €38 million in FY 2022
compared to a net cash outflow of €8 million in FY 2021. The degradation in
working capital was primarily driven by the higher level of inventories at the
end of the year due to both supply chain disruptions for the Mail business and
delays in retail and residential projects for the Parcel Locker Solutions. The
slower collection of receivables compared to the exceptional level in FY 2021
(catch up impact post Covid-19 crisis) also impacted the working capital.
Lease receivables recorded a remarkable small decrease of only €8 million
in FY 2022 compared to a decrease of €39 million in FY 2021. This extremely
solid performance has been achieved thanks to the high level of hardware
placement for Mail-Related Solutions, which in turns slows the decline of the
leasing portfolio.
The leasing portfolio and other financing services is stable at
€595 million as of 31 January 2023, the same level as of 31 January 2022
helped by a positive currency impact. On an organic basis, this represents a
slower decrease of 1.4% at the end of FY 2022 compared to a decrease 6.4% at
the end of FY 2021. At the end of FY 2022, the default rate of the leasing
portfolio stood at around 1.6% compared to 1.7% at the end of FY 2021.
Interest and taxes paid decreased significantly to €35 million in FY 2022
versus €66 million in FY 2021. The lower amount paid in 2022 is mostly
explained by the reimbursement of the 2020 tax loss carry-back measures in the
US.
Capital expenditure remained stable in 2022 at €88 million. Development
capex was also stable at €36 million in 2022 (vs. €37 million in FY
2021) and was mostly spent on R&D investments for software developments and
Parcel lockers innovations. Rented equipment capex was slightly up
year-over-year at €30 million in FY 2022, compared to €29 million in FY
2021, thanks to the sustained level of Mail-Related Solutions hardware
placements, the on-going deployment of Parcel Locker Solutions contracts in
France and Japan as well as the start of the installation of the new UK open
network. The small increase in maintenance capex, to €13 million, was
mostly linked to software projects and IT equipment spendings. To be noted,
while previously capitalised, cloud computing investments are now expensed or
moved to prepaid expenses in line with the new IFRIC accounting standard for
an amount of €8 million.
Consequently, cash flow after capital expenditure for the year was down to
€70 million in FY 2022 compared to €104 million in FY 2021.
LEVERAGE AND LIQUIDITY POSITION
Net debt stood at €722 million as of 31 January 2023, an increase against
the €504 million of net financial debt recorded as of 31 January 2022 but
this represents a significant decrease versus the €769 million, comprising
the 2021 net financial debt plus the €265 million ODIRNANE facility
accounted for as equity. Therefore, the overall financial structure for the
Group has improved significantly in FY 2022 despite the increase in debt level
which is due to the repayment in full of the ODIRNANE instrument in June 2022.
The ODIRNANE was repaid following the successful issuance of a €270
Schuldschein emission in November 2021. The Group has no significant debt
maturity before its €325 million 2.25% bond maturing in 2025.
The leverage ratio (net debt/EBITDA) improved slightly to 3.0x(5) as of 31
January 2023 versus 3.1x(5) as of 31 January 2022 (adjusted for the ODIRNANE).
Excluding leasing and adjusted for the ODIRNANE, the leverage ratio also
improved to 1.8x(5) as of 31 January 2023 vs 2.0x(5) at the end of FY 2021
(31 January 2022). The Group remains focused on reaching its leverage ratio
target of 1.75x(5) excluding leasing as of 31 January 2024.
As of 31 January 2023, the Group had a robust liquidity position of
€572 million, split between €172 million in cash and a €400 million
undrawn credit line, the latter maturing in 2024.
Shareholders’ equity stood at € 1,082 million as of 31 January 2023
compared to €1,359 million as of 31 January 2022. The gearing
ratio12(10)(10) went up to 66.7% as of 31 January 2023 from 37.1% as of 31
January 2022 due to the mechanical impact from the ODIRNANE reimbursement
(double impact from lower equities and higher debt).
OUTLOOK
FY 2023 guidance allows to confirm the 2021-2023 financial outlook
Revenue guidance
* Sales outlook is confirmed at minimum 3% organic sales CAGR over 2021-23
* FY 2023 organic sales growth is expected c.3%.
Current EBIT(2) guidance
* Current EBIT(2) outlook is confirmed at minimum mid-single digit organic(6)
current EBIT(2) CAGR over 2021-23
* FY 2023 organic growth in current EBIT(2) is expected at c.10%.
In terms of the organic revenue growth, FY 2023 is expected to benefit from
the positive trend in Annual Recurring Revenue for Intelligent Communication
Automation, which grew at +22% organically in FY 2022 and is expected to
translate into a similar level of subscription-related revenue growth in FY
2023. In addition, solid cross-selling and upselling dynamics should also
continue to drive growth in future bookings. As the weight of licenses sales
continues to decrease, growth for Intelligent Communication Automation is
expected to gradually move closer to the subscription-related revenue growth.
After two remarkable years of organic growth for Mail-Related Solutions,
driven by solid hardware placements and some benefits from price increases,
the outlook for FY 2023 is cautiously optimistic thanks to further benefits
from price increases and further upgrade of the installed base.
Parcel Locker Solutions should deliver strong organic growth in FY 2023
supported by the rising contribution of the larger installed base as well as
some catch up in installations in the US following the delays recorded in FY
2022 in the residential and retail sectors.
Turning to the current EBIT(2), the improvement in profitability is expected
to be driven by:
i) The rising profitability of the installed base for both the SaaS
activity and parcel lockers,
ii) Continued improvement in current EBIT((1) ) for Intelligent
Communication Automation as the transition to SaaS is almost completed,
significant increase in current EBIT(2) expected for Parcel Locker Solutions
driven by acceleration of locker placements, whilst Mail-Related Solutions
current EBIT(2) margin should remain high thanks to careful price control, and
iii) Lower freight costs.
However, salary inflation is expected to continue.
BUSINESS HIGHLIGHTS
Quadient launches Parcel Pending smart lockers in Ireland to support on-going
modernization of the residential property industry
On 8 November 2022, Quadient announced the launch of Parcel Pending by
Quadient in Ireland. By providing secure, self-service smart parcel lockers to
businesses across the country, together with a dedicated support center and
response and repair team, Quadient will help the Irish economy capitalize on
the property boom by simplifying parcel delivery and improving residents’
experience.
Esker and Quadient to Develop Electronic Invoicing Platform, to Partner with
French Government
On 21 November 2022, Esker and Quadient announced that their years-long
collaboration will take on a new dimension by partnering with the French
government’s upcoming Partner Dematerialization Platform (PDP).
Top 250 Ranking of French Software Companies Places Quadient Fifth in
‘Horizontal Publishers’ Category
On 25 November 2022, Quadient announced it has been ranked fifth in the EY and
Numeum 2022 Top 250 list of French software companies in the Horizontal
Publishers (cross-industry) category, as well as fifteenth in the overall
ranking.
Relais Colis Installs 200 to 300 Quadient Parcel Lockers in Carrefour Retail
Stores
On 1 December 2022, Quadient announced that Relais Colis, a key player in the
French out-of-home parcel delivery market, is installing 200 to 300 Quadient
smart lockers in Carrefour retail stores
Quadient Named an Approved Cloud Software Supplier on UK Government’s
Digital Marketplace
On 6 December 2022, Quadient announced it has been awarded a place on the UK
government’s new G Cloud 13 framework, managed by Crown Commercial Service
(CCS). G Cloud provides organizations, across both central government and the
wider public sector, with an online digital marketplace to procure cloud-based
software solutions.
Quadient Announces Fourth Carrier Joining its Smart Locker Open Network in the
UK
On 13 December 2022, Quadient announced that a fourth international carrier
has joined its open network of parcel lockers in the UK.
Quadient Announces New Accounts Payable Automation Cloud Solution Integration
with Microsoft Dynamics Business Central
On 20 December 2022, Quadient announced a new partnership between its accounts
payable (AP) automation cloud solution and Microsoft Dynamics Business Central
(formerly known as MS Dynamics NAV) that will benefit users in North America,
UK, and Ireland.
Quadient Announces over $12m Subscription-based Software Services Contract
with Top 5 Global Health Insurance Company
On 4 January 2023, Quadient announced the largest contract for its Intelligent
Communication Automation (ICA) solutions, with the signature of a two-year
contract extension with one of the top 5 global healthcare insurance companies
based in the United States.
MTS Logistics Selects Quadient to Automate and Secure Over 3.5 million
Annual Healthcare Communications
On 18 January 2023, Quadient announced that MTS Logistics has selected
Quadient to support its expanding delivery and forwarding services for the
healthcare sector. MTS Logistics recently upgraded its facility and today
utilizes a complete suite of solutions from Quadient for the processing of
confidential mail, including two IS-6000 high-performance mailing systems, two
DS-200i connected folder inserters, mail integrity software AIMS (Automated
Insertion Management System) and Quadient’s software solution to automate
multi-channel customer communications.
Quadient Ranked Among Global 100 Most Sustainable Companies for Second Year in
a Row
On 20 January 2023, Quadient announced that it has been included in this
year’s Corporate Knights’ Global 100 ranking of the world’s most
sustainable companies. For the second year in a row, Quadient has been
recognized for its Corporate Social Responsibility (CSR) strategy, earning the
75(th) spot in the 19(th) annual ranking published by the international
sustainable business research organization.
POST-CLOSING EVENTS
Quadient Introduces iX-1 Postage Meter in U.S. for Small Business and Home
Offices
On 1 February 2023, Quadient announced the general availability in the U.S. of
the Quadient iX-1 postage meter, a compact yet powerful mailing system that
combines mail and parcel processing into one user-friendly solution designed
for the small office environment.
New Drop Box Facilitates Returns with Parcel Pending by
Quadient Lockers in UK; Evri to be the First Carrier to Use the
Technology
On 7 February 2023, Quadient introduced an additional feature for its Parcel
Pending by Quadient
(https://www.globenewswire.com/Tracker?data=c866kEz5zLBryl2jLVYfHFtjP2wBUUm2pcBxbZ9sPUfsP1N4UWNcp7SXciT2lXuitBdDNEv3q2MQONTYlaITVK6hL8BjEQ15S3-nFFAzRkq-enqnyOLJz9c2Jk0tZNUuM8yjZWnX2wCudSHGq1U1yx7hGG9CEEhNOOtgFb__ndzwcSebO6BV9fGab7WekHyZ) smart
lockers that enables shoppers to easily drop off parcels, with the added
ability to print shipping labels if needed.
Quadient Celebrates Milestone of 10,000 Smart Locker Units Installed in North
America and 18,000 Worldwide
On 28 February 2023, Quadient announced it has reached a significant milestone
with more than 10,000 parcel locker units in operation in the United States
and Canada and a total of 18,000 units globally.
Ferguson Selects Quadient’s Smart Lockers for Convenient, Secure Order
Pickup
On 13 March 2023, Quadient announced Ferguson, a leading distributor providing
expertise, solutions and products from infrastructure, plumbing and appliances
to HVAC1, fire, fabrication and more, has deployed Parcel Pending by Quadient
smart lockers, including the new line of oversized lockers, in direct response
to customer demand for a streamlined in-store pickup experience during and
outside of regular store hours. Ferguson operates over 1,500 locations in the
United States, serving all 50 states, many with same-day and next-day product
availability.
Quadient Accelerates Growth of Cloud-based Solutions in the Public Sector with
More than Twenty New Contracts Signed in 2022
On 15 March 2023, Quadient announced growth momentum for its Intelligent
Communication Automation solutions among public sector organizations across
major geographies. In the 2022 fiscal year that closed 31 January 2023, more
than 20 new public sector organizations selected Quadient’s cloud-based
solutions to manage critical multichannel communications, accounting for
nearly 10% of new contracts’ value and almost a tenfold increase over 2021.
To know more about Quadient’s newsflow, previous press releases are
available on our website at the following address:
https://invest.quadient.com/en-US/press-releases.
CONFERENCE CALL & WEBCAST
Quadient will host a conference call and webcast today at 6:00 pm Paris time
(5:00 pm London time).
To join the webcast, click on the following link: Webcast
(https://www.globenewswire.com/Tracker?data=ZyqwUd0LcSEMtDDK8MnGcOxR70plFlP4VJdiQ9icJTsEYQbfR-y1XSRSNX8-a7SwsCHggx6Khvajr8Q7RNGtNU1UnwnH7dEBh1f3ruG6HE9Oi19CRietLKFGMzRsavyxyGzsr7oGhrT3RHY1tW_JYw==).
To join the conference call, please use one of the following phone numbers:
▪ France: +33 (0) 1 70 37 71 66;
▪ United States: +1 786 697 3501;
▪ United Kingdom (standard international): +44 (0) 33 0551 0200.
Password: Quadient
A replay of the webcast will also be available on Quadient’s Investor
Relations website for 12 months.
CALENDAR
* 31 May 2023: Q1 2023 sales release (after close of trading on the Euronext
Paris regulated market).
* 16 June 2023: Annual General Shareholders Meeting
About Quadient®
Quadient is the driving force behind the world’s most meaningful customer
experiences. By focusing on three key solution areas, Intelligent
Communication Automation, Parcel Locker Solutions and Mail-Related Solutions,
Quadient helps simplify the connection between people and what matters.
Quadient supports hundreds of thousands of customers worldwide in their quest
to create relevant, personalized connections and achieve customer experience
excellence. Quadient is listed in compartment B of Euronext Paris (QDT) and is
part of the CAC® Mid 60 and EnterNext® Tech 40 indices.
For more information about Quadient, visit https://invest.quadient.com/
Contacts
Catherine Hubert-Dorel , Quadient +33 (0)1 45 36 61 39 c.hubert-dorel@quadient.com financial-communication@quadient.com Caroline Baude, Quadient +33 (0)1 45 36 31 82 c.baude@quadient.com OPRG Financial Isabelle Laurent / Fabrice Baron +33 (0)1 53 32 61 51 /+33 (0)1 53 32 61 27 isabelle.laurent@oprgfinancial.fr fabrice.baron@oprgfinancial.fr
FULL-YEAR 2022
Consolidated income statement
In € million FY 2022 (period ended on 31 January 2023) FY 2021 (period ended on 31 January 2022)
Sales 1 , 081 1 , 024
Cost of sales (291) (280)
Gross margin 790 744
R&D expenses (57) (52)
Sales and marketing expenses (277) (256)
Administrative and general expenses (186) (175)
Service and support expenses (114) (109)
Employee profit-sharing and share-based payments (6) (5)
Current operating income before acquisition-related expenses 150 147
Acquisition-related expenses (10) (12)
Current operating income 140 135
Optimization expenses and other operating income & expenses (73) (19)
Operating income 6 7 116
Financial income/(expense) (36) (8)
Income before taxes 3 1 108
Income taxes (16) (20)
Share of results of associated companies 1 1
Net income 1 6 89
Minority interests 3 1
Net attributable income 1 3 88
Simplified consolidated balance sheet
Assets In € million 31 January 2023 31 January 2022
Goodwill 1,080 1,120
Intangible fixed assets 125 138
Tangible fixed assets 154 186
Other non-current financial assets 80 99
Leasing receivables 595 595
Other non-current receivables 6 6
Deferred tax assets 16 20
Inventories 86 73
Receivables 237 227
Other current assets 93 93
Cash and cash equivalents 172 487
Current financial instruments 3 2
TOTAL ASSETS 2 , 6 4 7 3 , 046
Liabilities In € million 31 January 2023 31 January 2022
Shareholders’ equity 1,082 1,359
Non-current provisions 13 19
Non-current financial debt 730 869
Current financial debt 114 57
Lease obligations 50 65
Other non-current liabilities 3 2
Deferred tax liabilities 136 158
Financial instruments 6 3
Trade payables 79 80
Deferred income 203 193
Other current liabilities 231 241
TOTAL LIABILITIES 2 , 6 4 7 3 , 046
Simplified cash flow statement
In €millions FY 2022 (period ended on 31 January 2023) FY 2021 (period ended on 31 January 2022)
EBITDA 240 245
Other elements (17) (18)
Cash flow before net cost of debt and income tax 223 227
Change in the working capital requirement (38) (8)
Net change in leasing receivables 8 39
Cash flow from operating activities 19 3 258
Interest and tax paid (35) (66)
Net cash flow from operating activities 1 58 192
Capital expenditure (88) (88)
Net cash flow after investing activities 70 104
Impact of changes in scope 3 (61)
Others 0 9
Net cash flow after acquisitions and disposals 73 52
Dividends paid (21) (17)
Change in debt and others (393) (53)
Net cash flow from financing activities (41 4 ) (70)
Cumulative translation adjustments on cash (3) (9)
Change in net cash position (34 4 ) (28)
1 FY 2022 sales are compared to FY 2021 sales, from which is deducted
revenue pro rata temporis from the APS business and production facility in the
Netherlands, Graphics activities in the Nordics and Shipping business in
France and to which is added revenue pro rata temporis from Beanworks, for a
consolidated amount of €(21) million, and are restated after a
€64 million positive currency impact over the period.
Q4 2022 sales are compared to Q4 2021 sales, from which is deducted revenue
pro rata temporis from the graphics activities in the Nordics and Shipping
business in France for a consolidated amount of €(4) million, and are
restated after a €10 million positive currency impact over the period.
2 Current operating income before acquisition-related expenses.
3Organic change excludes currency, scope and IFRIC impacts.
4 Cash flow after capital expenditure.
5 Including IFRS 16.
(6) Based on 2020 current operating income before acquisition-related expenses
excluding Parcel Pending’s earn-out reversal, i.e. €145 million, with a
scope effect resulting in a €140 million proforma. The organic growth
calculation excludes scope, forex and IFRIC impacts.
7 FY 2022 ARR benefited from a €10 million positive currency impact vs
January 2022
8 For the full year 2022, the average compounded number of shares is
33,927,065, and the fully diluted number of shares is 33,927,065.
(9) EBITDA = current operating income + provisions for depreciation of
tangible and intangible fixed assets.
10 Net debt / shareholders’ equity
Attachment
* PDF
(https://ml-eu.globenewswire.com/Resource/Download/4cdd0b8d-9e36-425c-b0c9-bc14c4b3aac8)