(AOF) – In the first half, Derichebourg generated net profit attributable to shareholders of the consolidating entity of 117.8 million euros, up 60%. Current EBITDA reached €250.6 million, up 45.2%. “An improvement in unit margins in the Recycling activity, partially offset by increases in costs (energy and fuels in particular), and the contribution of Ecore explain most of this increase”, specifies the company.
The Derichebourg group’s pro forma current EBITDA over 12 rolling months amounts to 559 million euros. This figure does not take into account the effect of the disposals of assets to come within the framework of the commitments made before the European Commission.
Consolidated sales amounted to 2.5 billion euros, up 54%. This increase is mainly due to the Environmental Services division (+70%).
The volume of scrap marketed increased by 19.9%. This increase is explained by the consolidation of Ecore volumes. Excluding this contribution, the volumes handled by the group are down around 10%.
This decrease in underlying volumes is mainly explained by the decline in automotive production in a context of lack of semiconductors.
“In the short term, the current economic situation brings uncertainties about growth, because of the geopolitical events that have been taking place in Europe for 3 months. A slowdown in economic activity would temporarily impact the group’s results” warns the operator business and environmental services in its outlook.
In the Multiservices business, revenue should continue to grow thanks to good commercial momentum. The increase in profitability in the second half compared to last year will depend on the ability to pass on to customers, or to the cost base, the increase in wages. Aerospace-related activities should continue to improve.
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Key points
– Global operator of environmental services, created in 1956 under the name of Cie Française des Ferrailles;
– Turnover of €4.6 billion divided into 2 businesses: environmental services for 61% (collection and treatment of metals, aluminum and toxic waste) and multi-services (cleaning, industrial cleaning, public lighting, interim solutions and human relations);
– High weight of France (72% of revenues), followed by Europe (22%) and America (6%);
– Business model based on a dense network, vertical integration for the environment and, for multi-services, a digitized offer and integrated services;
– Capital locked by the Derichebourg family (41.5% of the capital and 57.8% of the voting rights), Daniel Derichebourg, Chief Executive Officer, chairing the 9-member Board of Directors;
– Financial strength with a net debt of €196 million against €703 million in equity.
Challenges
– Growth strategy: environmental services: consolidate the leading position in metals and increase the share of non-ferrous metals to 20-25%, deployment of the collection offer to local authorities, expected synergies of 21 M € from the integration of Ecore -€1.3 billion in sales, 78 sites in Europe with a recovery ratio of 80%, of which 98% for battery components;
– Innovation strategy not detailed by the company and integrated into environmental issues;
– Environmental strategy 2018/22 “concretely responsible”: reduction of emissions by 2 levers: recycling of metal waste and energy by the recovery of shredding residues and agreement to deliver 19 MW of load shedding capacity with Total Flex, carbon offsetting, renewal of the transport fleet, use of StartMC&Alert Gasoil technologies and use of river transport (23.6% for raw materials) and rail (8%), deployment of recycling plants for automobiles and large household appliances, launch of a “green loan”;
– Benefits of the partnership with Saur in water-related services to local authorities;
– Balance between the 2 activities: short cycles in the environment, with strong price variations, and long cycles secured by multi-year contracts in multi-services;
– Continuation of establishments, strengthened in France and abroad – Germany, ie €11 million in additional revenue.
Challenges
– Market driven by interest in raw materials from recycling and by outsourcing to Multiservices customers;
– Double impact of the rise in raw material prices: favorable on scrap metal prices, negative in terms of collection of volumes due to the drop in automobile production;
– After strong growth in operating profitability, confidence for the 2021/2022 financial year ended September 30;
– Resumption of the dividend service, of €0.32, i.e. a distribution rate of 30%.
Business services: road transport faced with a labor shortage
A report published by Dares (Direction de l’Animation de la recherche, des Etudes et des Statistiques) in October 2020 pointed out that truck drivers were among the thirty most stressed professions in France in 2019. This tension is not fallout and could even increase in the coming years. According to the OTRE (Organization of European Road Carriers), the needs could reach 100,000 jobs in the next five years. The phenomenon, which was lessened during successive confinements, reappeared with the resumption of activity. It is partly linked to a lack of image and unattractive remuneration. Unfortunately the recent negotiations between the social partners to revalue the minima of branch did not succeed.