Thursday 18 August 2022

IVS Group expected to exceed annual sales of 400 million EUR in 2017

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GRAND DUCHY OF LUXEMBOURG – The Board of Directors of IVS Group S.A. (Milan: IVS.MI), convened on November 28th, 2017, and chaired by Mr. Paolo Covre, examined and approved the Interim Consolidated Report as of September 30th, 2017, which shows a significant growth of IVS Group performances.


  • Consolidated Revenues: Eur 303.7 million, +12.6%, compared to September 30th, 2016.
  • Adjusted EBITDA1: Eur 68.7 million, +10.8% compared to September 30th, 2016, with an EBITDA margin on sales of 22.6% partially diluted for the effects of the acquisition in Spain.
  • Group Net Profit: +17.3% equal to Eur 14.0 million, after profits attributable to minorities of Eur 1.2 million and taxes for Eur 7.8 million.
  • Adjusted Net Profit +1.3% equal to Eur 16.5 million (from Eur 16.3 million at September 2016) after profits to minorities.
  • Completed in the first nine months 11 new acquisitions in Italy, Spain and Switzerland, with an enterprise value (“EV”) of around Eur 33.9 million. In particular, the acquisition of Grup Ibervending in Spain, with an EV of Eur 26.2 million is a very significant move for IVS Group, and a base for a growth strategy similar to that successfully realized in Italy.

Operating performance

In the first nine months of 2017 consolidated revenues reached Eur 303.7 million (of which Eur 280.1 million related to the core vending business), with an increase of 12.6% compared to Eur 269.8 million at September 30th, 2016 (of which Eur 248.3 million in vending).

Revenues in the vending business increased by 6.7% in Italy, by 89.6% in Spain, by 0.8% in France and by 549.4% in Switzerland. Almost stable the coins management business sales (Coin Service division -0.8% overall, +7% in the metal coins business).

The sales increase in the vending business in the first nine months comes principally from the consolidation of the acquisitions in Spain (Grup Ibervending, January 2017) and Switzerland (Demomatic, December 2016), from excellent results in the OCS-Office Coffee Service segment, supported by the Nespresso™ products, but also from the organic growth (like-for-like +2.5% in absolute and +2.6% working days adjusted), as an effect of volumes increase (around +0.9% and +1% working days adjusted) and the increase of average selling price per vend, +1.0% compared to first nine months 2016 (from Eur 46.44 cents to Eur 46.88 cents).

Average selling price increase is influenced by the increased weight of Spain, where average unit prices are lower. Like-for-like sales and volumes increased especially in Italy (+3.1% and +1.6% respectively) also thanks to the performance in the OCS, following the extended area of the distribution agreement with Nespresso Italiana, which allowed to change into positive the past trend in this market segment.

Confirming the previous trend, also in the third quarter IVS shows an acquisition rate of new clients (+1.7%) higher than the churn rate (clients lost -1.2%). The total number of vends in the first nine months of 2017 is equal to 597.5 million, +11.8% compared to 534.6 million of 2016.

During the first nine months of 2017 were completed 11 acquisition in Italy, Spain and Switzerland, with an Enterprise Value of around Eur 33.9 million, contributing to the group sales from the date of the acquisition, for Eur 23.3 million.

Adjusted EBITDA increased by 10.8% compared to the first nine months of 2016, from Eur 62.0 million to Eur 68.7 million (22.6% margin on sales). It should be noticed that the third quarter, with summer holidays, has less working days and volumes compared to the other quarters.

The ongoing efforts for integration of the acquired businesses will generate in the following 10-12 months the expected positive effects on the P&L accounts, in particular in Spain, which although already profitable, is still far from the levels of the rest of the group, therefore diluting its profitability.

Group Net Profit in the first nine months of 2017 is equal to Eur 14.0 million (after profits attributable to minorities of Eur 1.2 million) +17.3% compared to Eur 11.9 million as of September 2016 (after minorities of Eur 1.3 million). Net profit includes some costs and profits considered as exceptional, totalling Eur 2.5 million (net of related tax effects): amongst these, the most important, in the operating costs for Eur 3.3 million, is the provision for the Antitrust procedure already included in the first half 2017 report; other exceptional costs for Eur 2.1 million are principally related to acquisitions and other tax provisions. Are also present extraordinary financial profits related to the sale of ESP minority stake in France, which generated a capital gain of Eur 2.9 million.

The Net Profit Adjusted for the exceptional items is equal to Eur 16.5 million (after taxes and minorities), increased by 1.3% from Eur 16.3 million at September 2016. In the third quarter the taxes are affected by the application of new (worsened) rules and criteria on ACE (Italian tax incentives on growth) and by an higher taxable result. In the coming quarters, new tax rules concerning higher levels of tax deductible depreciation on capex applicable also to IVS could partially mitigate the expected increase of income taxes.

Net Financial Position (“NFP”), is equal to Eur -254.7 million (from Eur -225.6 million as of December 31st, 2016 and Eur -260.9 million at 30 June 2017), after payments for net investments and acquisitions in the first nine months of Eur 69.7 million (of which Eur 34.8 million for investment in fixed assets – including those related to newly acquired businesses and done in previous quarters – and Eur 34.9 million for acquisitions) and Eur 9.0 million for dividends. NFP includes the accruals for interests matured on bonds (paid of November 15th). The NFP is influenced also by the payments already made for the Antitrust fine, equal to approximately Eur 9.6 million in the first 9 months of 2017 (Eur 12.8 million in total). Finally, the group has Eur 10.2 million of VAT credit with the Italian tax authority, non included in financial credits and so excluded by the NFP.

Other significant events occurred after September 30th, 2017 and prospects for the full year

The first nine months of 2017 showed gradual recovery signals, which are expected to continue in the remaining part of the year. The start of the last quarter confirmed a recovery of consumptions also in the vending sector, linked to the increase of production and hours worked, although not homogeneous in all the Italian regions.

The development of the distribution agreement with Nespresso Italiana is progressing, with clear benefits on IVS expected volumes in the OCS market segment.

On these assumptions, it is expected that in 2017 the overall number of vends will exceed 800 million and the annual sales Eur 400 million, a significant result and a base for further growth in Italy and abroad.

IVS growth will remain based on new acquisitions, aimed at improving logistic efficiency and increase, also with additional technical investments, the service added value and quality, in a highly fragmented sector, with thousands of small and mid sized players all around continental Europe. In this context, the acquisition of Group Ibervending, whose integration is in progress, represents for IVS a platform for a growing density strategy in Spain, similar to that already reached in Italy.

This scenario is favourable to an aggregation process, driven also by the new tax rules applied to the vending sector.

Finally, the present low interest rates, coupled with IVS high cash-flow generation, will allow to reach further efficiency in financial costs and in the mix of resources raised on financial markets.

About IVS Group S.A.

IVS Group S.A. is the Italian leader and the second player in Europe in the business of automatic and semi-automatic vending machines for the supply of hot and cold drinks and snacks (vending).

The business is mainly carried out in Italy (82% of sales), France, Spain and Switzerland, with around 184,000 vending machines, a network of 80 branches and more than 2,600 employees. IVS Group serves more than 15,000 corporate clients and public entities, with approximately 800 million vends per year.

1 “Adjusted EBITDA’’: is equal to operating income, increased by depreciation, amortisation, write-downs, non-recurring costs and exceptional in nature

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