| €mn | 2004 | 2003 | Change |
| Sales |
355,5 |
339,8 |
+4,6 % |
| EBIT |
28,3 |
26,0 |
+8,7 % |
| as % of sales |
7,95% |
7,65% |
|
| Net financial expense |
(2,3) |
(2,2) |
|
| Exceptional items |
(1,3) |
(0,8) |
|
| Tax |
(7,9) |
(8,1) |
|
| Net income of fully consolidated companies |
16,7 |
14,9 |
+12,1% |
| Goodwill amortization |
(1,9) |
(1,7) |
|
| Minority interests |
(0,8) |
(0,4) |
|
| Net attributable profit |
14,0 |
12,8 |
+9,8% |
Strong growth by the Group's strategic businesses (sales excluding fittings: +13.7% and +9.7% at constant structure and exchange rates) once again fueled further gains in margins.
EBIT advanced 8.7% to €28.3 million. The Group EBIT margin in consequence continued to improve, increasing to 7.95%, (versus 7.65% in 2003 and 7.45% in 2002).
This trend reflects:
- Excellent performances by Global Services for Trade Shows, Exhibitions and Events with an EBIT margin of 6.9%,
- A sharp improvement in the margin for "Permanent and Semi-Permanent Installations" (formally "Fittings, Systems & Services") to 7.8% versus 5.9% in 2003.
- The increasing contribution of Venue and Event Management, accounting for 23% of net sales in 2004 with an EBIT margin of 10.8%.
In response to these developments, combined with the stability in net financial expense and exceptional items, net income of fully consolidated companies rose 12.1% to €16.7 million.
A solid balance sheet
Group cash flows surged 18% to €38.8 million. This in turn boosted operating cash flow by 12% to reach €34.8 million. Gearing (net financial debt/equity) was 37.5% compared with 36.0% at 2003 year-end.
This solid cash flow performance strengthens the Group's proactive strategy based on pursuing both internal growth and external growth opportunities. GL events will continue to focus on developing an integrated offering of turnkey value-added event industry services for organizers, companies and institutions.
The Group's healthy balance sheet enables it pursue its expansion into sectors offering attractive growth opportunities by:
- Developing a portfolio of venues and events and pursuing synergies with the Global Services business lines,
- Further strengthening the positions of Global Services in both France and international markets.
Positive outlook for 2005
Olivier Ginon, Chairman, declared: "GL events registered excellent performances in 2004 both in terms of growth and earnings. I would like to thank all members of the Group for their remarkable work, our customers for their confidence in GL events' expertise and our shareholders who reconfirmed their support through their positive response to our capital increase in July 2003.
Early 2005 has already been marked by major international successes in winning privatization bids for exhibition parks in Padua and Budapest. The Barcelona International Convention Center is also expected to register gains in volume in the year in progress.
On the basis of these trends, the Group anticipates another year of sustained growth in 2005. Our guidance for 2005 is sales exceeding €400 million accompanied by further improvements in margins."
Dividend
At the next General Meeting, the Board of Directors will ask shareholders to approve a dividend of €0.41 for the 2004 financial period representing an increase of 10.8% on the prior year.
Upcoming events:
Publication of 2005 first-quarter sales: 26 April 2005 (after the close of trading).
Publication of 2005 first-half sales: 27 July 2005 (after the close of trading).
Publication of 2005 first-half earnings and the impact of the adoption of IFRS: 6 September 2005 (after the close of trading).
