Full-Year 2019 Results

Revenue up 4.5% like for like⁽¹⁾ for the target scope and recurring EBIT⁽¹⁾ for the target
scope⁽²⁾ up 5.6%⁽³⁾ to €361 million

Sharp rise in free cash flow generation⁽¹⁾ for the target scope: up 20% to €250 million (excluding changes in working capital), and by 13% to €278 million including changes in working capital

Proposed ordinary dividend stable at €1.30 per share

2020 recurring EBIT growth target: between 4% and 6%⁽⁴⁾, excluding the impact of the coronavirus

Action plan in progress at Lagardère Travel Retail to mitigate the impact of the coronavirus on 2020⁽⁵⁾

With the sale of Lagardère Sports and of numerous media assets, in 2019, the Lagardère group completed the bulk of its strategic refocusing plan.

In 2019, the Group continued to see strong growth in revenue and in recurring EBIT based on the target scope⁽²⁾, driven by impressive momentum at Lagardère Publishing and Lagardère Travel Retail as the two divisions took full advantage of the opportunities resulting from their diverse geographic and business profiles.

Free cash flow for the target scope (excluding changes in working capital) totalled €250 million, a rise of 20% year on year led by strong margin growth in the Group’s two businesses.

The Group also continued to develop its two pillars, with the acquisitions of Gigamic, Short Books and Blackrock Games at Lagardère Publishing, and of the International Duty Free group (IDF) at Lagardère Travel Retail. These acquisitions were mainly financed out of proceeds from the sale of media assets.

Continued growth momentum

• The target scope reported revenue of €6,936 million in 2019, up 4.5% like for like. This growth momentum was powered by a solid performance at Lagardère Travel Retail, which delivered 6.3% growth, and by a good year at Lagardère Publishing, which advanced by 2.8%.

Continued rise in recurring EBIT

• Recurring EBIT was 5.6% higher than in 2018, meeting the recurring EBIT target for the target scope as confirmed on 7 November 2019 (“Restated for the impact of IFRS 16 on concession agreements at Lagardère Travel Retail, at constant exchange rates and excluding Lagardère Travel Retail’s acquisitions of Hojeij Branded Foods (HBF) and International Duty Free (IDF)”).
• Recurring EBIT for the target scope came in at €361 million versus €310 million in 2018, buoyed by good performances from Lagardère Travel Retail and Lagardère Publishing, and by the consolidation of HBF.
• Profit before finance costs and tax was €411 million in 2019, compared with €451 million in 2018 which had included the one-off capital gain on the sale of the office building located in rue François 1^er (Paris, France).
• Profit for the period was €11 million, down from €199 million in 2018 owing to the adverse impact of discontinued operations. Restated for non-recurring/non-operating items, adjusted profit – Group share was €200 million, stable year on year.

Solid financial position

At end-December 2019, net debt stood at €1,461 million. The leverage ratio (net debt ⁽¹⁾/recurring EBITDA⁽¹⁾) at both end-2019 and end-2018 was 2.1.

Consolidated data

At 31 December 2019, Lagardère Sports is classified within “Assets held for sale and associated liabilities” in the consolidated balance sheet. In accordance with IFRS 5, the contribution of Lagardère Sports is presented as a single amount on the face of the 2019 consolidated income statement and consolidated statement of cash flows, within “Profit (loss) from discontinued operations” and “Net cash from (used in) discontinued operations”, respectively. Data for 2018 have been restated for the purposes of comparability.

¹ Alternative performance measure, see definition at the end of the press release.
² Lagardère Publishing, Lagardère Travel Retail, Lagardère News (Paris Match, Le Journal du Dimanche, Europe 1, Virgin Radio, RFM, the Elle brand licence), the Entertainment business, the Group Corporate function and the Lagardère Active Corporate function, whose costs are being wound down by 2020.
³ Restated for the impact of IFRS 16 on concession agreements at Lagardère Travel Retail, at constant exchange rates and excluding Lagardère Travel Retail’s acquisition of HBF and IDF.
⁴ At constant exchange rates, excluding the impact of Lagardère Travel Retail’s acquisition of IDF.
⁵ The adverse impact to date and action plans are described on page 10 in the “Outlook” section.