2008 yearly results, Latecoere Group
Release Date: 2009-03-24
Sustained growth in activity further bolstered by extraordinary items.
Extraordinary items aside, revenues for Latécoère Group at the end of 2008 came in at € 579.5 million, up 18.4% on 2007. At constant exchange rates, organic growth stood at 16.8%. The Group's extraordinary revenues for the period amounted to € 104.4 million and correspond to R&D work that is already complete (under initial contractual terms, payments were to be staggered). As a result, consolidated revenues totaled € 683.9 million
Operating profit impacted by the unfavorable drop in euro/dollar parity
Operating income stood at € 31.9 million (4.7% of consolidated revenue) for 2008, down € 7.2 million on 2007. Euro/dollar parity had a negative impact of € 9.6 million over the twelve months. The direct costs linked to the Zéphyr* project were partly offset by the extraordinary revenues booked for the year. Adjusted for these two extraordinary items, operating profit accounted for 5.8% of the Group's total revenues of € 579.5 million. * Takeover of the Airbus sites at Méaulte and St Nazaire.
Net income hit by realized and unrealized losses on hedging instruments
Latécoère's financial income for 2008 represented a net expense of € 41.9 million, consisting of a debt expense of € 23.3 million, a realized exchange rate loss of € 11.3 million and € 11.5 million in unrealized losses.
Latécoère Group's realized exchange rate loss of € 11.3 million primarily results from the fair value adjustments made between April and August. These adjustments were made to ensure an average euro/dollar parity of 1:1.35 for 2008 despite the slide in the US currency over the first eight months of the year and the expiry of the Group's successful longstanding hedges at the end of the first half. Unrealized income was particularly affected by the changes in the fair value of financial instruments carried out during the second half of the year in a bid to tie down the Group's exposure to US dollar risk from 2009-2011.
Net income loss of € 6.7 million in line with forecasts
Adjusted for the unrealized losses on hedging instruments, Latécoère Group's net income would be slightly positive.
Reduction in net debt: a resources plan safeguarded by covenants that are adapted to the Group's new forecasts
Net debt improved € 41 million to stand at € 336 million on December 31, 2008.
Bank borrowings were renegotiated and consolidated over the second half of the year, and the Group's resources plan subsequently aligned with Latécoère's medium-term financing requirements. The requirements factor in an increase in debt in 2009 which should then drop from 2010 onwards as the aeronautical programs for which the Group pre-financed the development are completed.
Outlook and targets
At December 31, 2008, Latécoère's backlog of orders, which only includes firm orders by aircraft manufacturers, amounted to € 2,012 million, up 10% on the end of 2007 and representing over three years of revenue New orders from AIRBUS at the start of 2009 represent a total € 350 million for Latécoère. The contracts signed involve each of the company's three business divisions and cover the design and manufacturing of electrical furnishings and tooling for the A350. Based on the latest output forecasts from manufacturers in January, the Group anticipates revenues of approximately € 530 million in 2009, down 9% on the € 579.5 million (excluding extraordinary items) booked for 2008. However, given the current market climate, Latécoère does not exclude the possibility of additional production downtime. In terms of its operations, the Group is to pursue its program of changes under the banner of "Défi 2011" whose aim is to eventually bring its operating margin back up to 10% (based on a euro/dollar parity of 1:1.30). In terms of its financials, Latécoère will seek to increase its equity and/or quasi-equity in order to complete the measures already taken to reduce the company's debt by 2010. In doing so, the Group will be better placed to take advantage of any opportunities that will enable it to cement its positioning as a first-rate partner to the world's leading aircraft manufacturers.
| Type: | NORMAL |
| Company: | Latecoere Group |
| Country: | France |
| Url: | http://www.actus-multimedia.com/latecoere/nwsen/_ec_0082.html |