(AOF) – Wendel posted a revalued net asset, which measures the value of its asset portfolio, at December 31, 2022 of 7.456 billion euros, or 167.9 euros per share, down 9.2%. The investment company explains this decline by the fall in the equity markets in the value of listed assets. On the other hand, the value of unlisted assets increased by 10% over the year, on a like-for-like basis.
Turnover increased by 15.9% to 8.7 billion euros. It is up 10.7% organically. The contribution of adjusted consolidated subsidiaries was 791 million euros, up 15.5%.
Net income group share amounted to 656.3 million euros in 2022 compared to 1.047 billion euros in 2021.
” Wendel can now initiate a new stage in its development around strategic orientations that create value for all its shareholders. Our ambition is, firstly, to invest approximately 2 billion euros within 24 months, in companies in Europe and North America. Wendel will be an active and influential shareholder, working closely with its companies to accelerate their growth. This is particularly the case with Bureau Veritas, whose potential we are convinced”, added declared the chairman of the executive board, Laurent Mignon.
Before adding: “Furthermore, Wendel has decided to develop an asset management activity on behalf of third parties, relying on the legitimacy and competence of its teams. This new business, whose growth will take place over time , will represent a new source of value creation, alongside its activity as a long-term investor. Our objective is to offer our shareholders a double-digit TSR.”
The LTV ratio, equivalent to the debt ratio, was 5.8% as of December 31, 2022. Total liquidity amounted to 1.7 billion euros as of December 31, 2022, including 961 million in available cash and 750 million euros of credit line (undrawn).
An ordinary dividend of 3.20 euros per share for the 2022 financial year, up 6.7%, will be proposed to the General Meeting of June 15, 2023.
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Key points
– Investment company born in 1704 and European number one in private equity;
– Portfolio of €7.1 billion, split between listed companies -Bureau Veritas and Tarkett- for 27% of gross assets and unlisted holdings -Cromology, Stahl, Constantia Flexibles, CPI, etc.;
– Turnover of €7.5 billion split between Bureau Veritas for 61%, Constantin Flexibles for 20%, Stahl for 9% and Cromology for 8%, IHS being accounted for using the equity method (€1.2 million in revenue);
– Investments in equal shares between Europe, especially Germany, North America and emerging countries including Africa with Tsebo, Servcor, Compass and IHS and India with Creative Polypack;
– Business model:
– takeover of leading companies or a stake influencing strategy,
– breakdown of assets between direct holding and via the Oranje Nassau holding company,
– investment budget of 750 M per year and debt control at 2.5 M€ at most,
– double-digit average return rate, regular increase in distribution;
– Executive Board led from December 2 by Laurent Mignon and Supervisory Board of 11 members led by Nicolas von Hulst, the Wendel family holding 37.7% of the shares and 50.77% of the voting rights;
– Solid financial position with an LTV ratio of 6% and cash of €1.7 billion at the end of September, with debt at an average cost of 1.7% and with a maturity of 6.6 years.
Challenges
– Roadmap 2021-2024:
– portfolio of 7 to 10 companies with equity investments of 150 to 500 M€ and seizing development capital opportunities,
– increase of Wendel Lab to 5-10% of development capital,
– focus on Western Europe, particularly France, and the United States;
– Innovation strategy aimed at seizing the levers of value creation in digital,
– new management of “IT strategy and digital transformation”
– HR and ERP Finance IS deployments and reinforcement of cybersecurity,
– reinforcement of Wendel Lab, both in charge of investments in funds invested in digital and disruptive companies or directly in start-ups (€167 million in total commitments);
– CSR strategy “Being exemplary” activating 2 levers, behavior as a company and investment and portfolio management strategies, hence the integration of the company in the ESG indices:
– compensation of employees partially indexed to ESG criteria,
– integration of ESG criteria in the investment process -54% of revenues provided by services or products with social and environmental added value,
– eco-efficiency in the operational process in order to reduce the carbon footprint,
– launch of the 1st loan and the 1st syndicated loan with ESG criteria;
– Portfolio rotation in 2022: acquisition of the American ACAMS, world leader in the fight against money laundering, sale of Cromology for €869 million and €51 million committed to funds by Wendel Lab.
Challenges
– At the end of September, decline, reflecting that of the equity markets, in revalued net assets of €155.2, compared to the stock market price;
– Strong sensitivity to Bureau Veritas, 1st contributor to profits;
– Low exposure to Russia and Ukraine, around 1%;
– After a 20.9% growth in the turnover of the companies in the portfolio, at the end of June all posting growth in their turnover in the 1st half;
– Share buyback programs.