Elis, an international multiservice provider, offering textile, hygiene and facility services solutions across 28 countries in Europe and Latin America, announced “very satisfying” 2019 full-year financial results. In a statement on 4 March, Elis CEO Xavier Martire revealed that revenue rose by 4.7% to reach a record €3.3bn, with organic growth attaining one of the highest-ever levels for the Group at +3.3%.
EBITDA margin (a measure of a company's operating profit as a percentage of its revenue) excluding IFRS (International Financial Reporting Standard) 16 remained solid at 31.5% of revenue. Net result and free cash-flow clearly improved.
Looking ahead to 2020, Martire said: “After a very good start of the year, we have been observing since last week the first impacts of the outbreak of the Covid-19 epidemic on our activity, with a decrease in orders from hospitality clients in Paris and in the South East of France.
“That said, Elis’ business model is robust: the nature of our contracts, the diversification of our client portfolio and the variety of our services make the Group very resilient in times of crisis. In case of a major activity slowdown, the resulting decrease in linen investment, as well as our ability to annualize working hours in our plants, thus to make our production costs variable, constitute natural buffers for cash generation and margins respectively.”
Reporting the 2019 results, Martire said: “The year 2019 was marked by high inflation in energy and labour costs, notably in Europe. In this context, Elis demonstrated its ability to pass on cost inflation in its prices, while improving its client retention rate.
"This key indicator, which measures the quality of our service and our commercial reactivity, improved in most of our regions, especially in France and in the workwear segment in the United Kingdom.
“We also continued to open the rental-cleaning activity in many countries, in particular in Brazil and Spain, countries with very high growth potential. This ability to develop our markets, combined with our multiservice strategy, offering additional services to our clients, represent significant drivers for value creation for the Group in the mid-to long-term.
“Our model is also virtuous from an environmental standpoint. The circular economy concept encourages maintenance, reuse and recycling, while Elis' know-how and processes made it possible to continue, in 2019, to optimize the consumption of water, energy and detergents, and reduce their environmental impact.
“Finally, the third and final part of the capex (capital expenditure) plan related to Berendsen was completed in 2019, in line with the initially anticipated amount and timeline. The Group also continued its targeted acquisition strategy while improving its leverage ratio. Cash generation, already higher than expected in 2019, should significantly increase this year.”