Brussels – Sales at Recticel were largely unchanged between 2017 and 2018 at EUR 1.4bn. Adjusted EBITDA was down slightly at EUR 103.8 m.
Olivier Chapelle, CEO, said: ‘2018 has been a challenging year, in the context of very soft European furniture and bedding demand, and declining automotive demand. Strong cash generation has led to substantial debt reduction.’
Looking at the divisions, automotive sales grew by 3.8% year-on-year to EUR 363.9m in 2018. Currency effects reduced growth by 0.7%. Within the division, sales in the company’s seating segment grew by 0.7% to EUR 164m in 2018. The interiors segment grew by 6.6% to EUR 164.4m in the year.
Recitcel said: ‘During H2, 2018 the production volumes at most automotive OEMs substantially decreased.’
The new worldwide harmonised Light Vehicles Test Procedure emission test cycle is being rolled out and slowing things down. Trade tensions between China and the US also hit volumes in China and Europe.
An additional EUR 4m boosted adjusted EBITDA. This windfall came from an insurance settlement following a fire at the company’s plant in Most, Czech Republic.
Recticel used the annual results announcement to say that the sale of 75% of Proseat to jv partner Sekisui is worth EUR 21m.
Sales in the company’s flexible foam business were flat year to year, at EUR 621.5m. In this division, growth was led by the technical foams business, which expanded by 2.5%. This helped to offset a 3% fall in the furniture and mattress sector.
In addition, the division is being expanded: Wuxi, China and Tangiers, Morocco will host new converting sites. Adjusted EBITDA grew by 2.2% to EUR 41.5m.
In the rigid foams business, higher volumes could not compensate for price erosion, and sales were flat at EUR 271.2 m in 2018. Adjusted EBITDA was up 10% in 2018, compared with 2017. This is because of lower raw material prices and a better product mix, Recticel said.
The company added that it expects its new plant in Finland will ‘start to have a positive contribution to results’ from 2020.
Additionally, Recticel increased its stake in Turvac, a Slovenian maker of vacuum insulation panels, in the past year. The Belgian company now owns 72% of the firm. The company spent EUR 8m to buy the additional stake. This gives it access to know-how, and a production base in Sostanj, Slovenia.
Adjusted EBITDA in the company’s bedding division nose-dived by almost 55% between 2017 and 2018, to EUR 6.8m. Recticel is closing the production site in Hassfurt, Germany, which hit the numbers.
Sales ware flat at EUR 271m in 2018.
‘Low shop traffic, especially in Germany, amplified trading difficulties in the sector. There was a 15% fall in sales in the non-branded/private label products sector. The company hopes that a new range of Geltex 2.0 products will help boost sales in the future.
The company used the IFRS 15 accounting standard for its 2018 results.
|Recticel Combined Group Numbers 2018 (EUR m)|
|Notes: Numbers ignore intersegmental eliminations; Accounting standard changed to IFRS in 2018|