ABO-Group Environment Annual Results 2021

ABO - Group

Ghent, 25 March 2022 – 18.30 CET – Press release / regulated information

2021 highlights

• ABO-GROUP again achieves record figures with a 28% growth in revenue to € 63.1 million

• EBITDA increases from € 7.5 to € 8.1 million

• Net financial debt remains low at € 9.3 million, despite acquisitions and investments

Outlook

• Further organic growth thanks to increasing awareness of PFAS issues, climate change and the circular economy

• Continued focus on external M&A opportunities, demonstrated by the first acquisition of 2022, being the soil department of the Dutch company Colsen

• Priority given to the development of expert teams in the different niches in our three domestic markets

Frank De Palmenaer, CEO of ABO-GROUP Environment: “In 2021, our Group demonstrated the strength of the DNA of ABO again, in particular the power to couple strong organic growth of the existing business with the complex but successful integration of the recent Geosonic, Geoplus, Subgeo and Asper acquisitions. The rebound of the operating margins in the second half of the year shows that the new activities are becoming well integrated. Together with the additional listing on Euronext Paris, we have already taken an 8% lead on the targeted growth path to € 100 million revenue in 2025.”

in € 000		2021		2020		% change
Revenue		63,068		49,352		27.8%
Total operating income		64,596		49,959		29.3%
EBITDA1		8,117		7,518		8.0%
Depreciation, amortization and provisions		-4,973		-4,478		11.1%
Operating profit		3,145		3,040		3.4%
Financial result		-552		-503		9.7%
Profit before tax		2,592		2,537		2.2%
Net profit		2,062		2,094		-1.5%
Total result		2,003		2,133		-6.1%
Earnings per share for the shareholders		0.19		0.20		-6.1%
Net cash flow from operating activities		6,778		8,689		-22.0%
Total equity		20,496		18,979		8.0%
Net financial debt		9,255		7,431		24.5%
Balance sheet total		65,602		57,002		15.1%

¹ EBITDA defined as operating profit before depreciation, amortization and provisions

2021 highlights

Strong 28% growth in revenue, both acquisitive and organic
In the course of 2021, ABO-GROUP revenue increased from € 49.4 to € 63.1 million, or by 28%, the strongest revenue growth ever. The acquisitions of Geosonic France, Geoplus, Subgeo and Asper represent 11% revenue growth, in addition to the organic growth of 17% of the existing activities in 2021.

In terms of the activities, both the Environment and the Geotechnology segments grew at virtually the same rate: the revenue of the Environment department increased by 24%, to an annual turnover of € 27.9 million (compared to € 22.4 million in 2020), while, thanks in part to the integration of Geosonic in France, Geotechnology achieved a growth of 31% and ended the year with a revenue of € 35.1 million (€ 26.8 million in 2020). With this, the share of the geotechnical activities increased from 54% to 56%.

The French operations confirmed their strong performance of the first half of the year and, with 53% of the revenue, now represent more than half of the Group. The overall 38% growth in revenue, from € 24.1 million in 2020 to € 33.2 million this year, was largely driven by the above-mentioned acquisitions, i.e. 21%, while the existing activities improved by 17%.

The geotechnical activities in Belgium continued their strong growth, and the Environment divisions benefited from the strongly increased demand, both in terms of PFAS and asbestos. The Translab subsidiary bridges both activities here, and has expanded its originally asbestos-focussed operations using environmentally-targeted laboratory tests. In addition to the 3% growth due to the contribution from the newly acquired Asper in July, this results in an organic growth of 17%, which led to an increase in the total revenue in Belgium from € 15.4 million to € 18.4 million in 2021.

The Dutch companies in the Group also confirmed their strong performance of the first half of the year, with a purely organic growth of 16%. Although the consultancy services were under pressure in an increasingly tight employment market, the environmental leg was the growth factor here, thanks to a large increase in field work.

EBITDA increases to € 8.1 million

The EBITDA amounted to € 8.1 million, an increase of € 559 thousand. After a margin decline in the first half of the year due to the integration costs of the French acquisitions, a clear recovery is now visible, with an EBITDA margin of 13.3% compared to the revenue in the second half of the year. The integration of the acquisitions is advancing well, and it is expected that they will be able to contribute positively to the profitability of the Group in 2022.

The tightness in the employment market remains an issue, however. In order to further support growth, the Group continues to actively search for competent profiles, while maintaining a continued focus on the training and education of existing employees. Rising salary costs due to the additional recruitment, both recent and expected indexations, as well as the short-term absorption of staff shortages through temporary employment agencies, will remain a focus of attention in the future.

Depreciations increased from € 4.5 to € 5.0 million. ABO-GROUP continues to invest in the renovation and expansion of its machinery in order to be able to respond adequately to the needs of its customers. Several new machines were purchased in 2021, including several drill and probing machines, as well as specialised laboratory equipment.

The financial result has slightly increased, in line with the increased debt level. In France, the Group could again rely on a R&D tax credit amounting to € 355 thousand (compared to € 270 thousand in 2020). The net profit remained stable at € 2.0 million (€ 0.19 per share).

Solid € 6.8 million operating cash flow and net debt of 1.1x EBITDA

The net cash flow from operating activities amounted to € 6.8 million (-22% compared to 2020), driven by the increase of the working capital requirements due to the strong growth in revenue. The trade receivables and other short-term assets increased by € 3.5 million, while the trade payables and other short-term liabilities increased by € 2.8 million, resulting in the operating capital increasing by € 730 thousand at the end of the year.

As a result of the recent acquisitions, as well as the investments in operating capital and fixed assets, the net financial debt increased by 25%, from € 7.4 million at the end of 2020 to € 9.3 million. With a ratio of 1.1x to the operating result before depreciation, the debt ratio remains very healthy and provides the Group with room to consider new acquisitions.

The balance sheet total increased from € 57.0 to € 65.6 million. On the assets side, this mainly reflects the recent acquisitions, as well as the above-mentioned increase in operating capital, while, on the liabilities side, the short and long-term debts increased. Total equity also increased further to € 20.5 million (compared to € 19.0 million at the end of 2020). The equity ratio settled at a healthy 31.2%.

The full consolidated income statement and balance sheet, the statement of changes in equity and the consolidated cash flow statement are shown below.

Outlook

2022 started with the momentum from 2021, with a first acquisition being an indicator of further growth ambitions

In 2022, ABO-GROUP is continuing with the momentum of 2021, with a strong commercial performance in the first months of the year. The order books of the various subsidiaries are well filled, and provide confidence for the rest of the year.

In addition, the Group was already able to announce its first acquisition in 2022, i.e. the acquisition of the soil activities of Colsen in Zeeland (the Netherlands) and, as always, is actively looking for other interesting targets that can further strengthen the Group’s product portfolio and geographic reach within its domestic markets. The Group considers it likely that additional announcements will follow.

The Board and the operating managements are convinced that the Group is on-track to achieve the targeted development that was outlined last year, with the aim of reaching the revenue cap of € 100 million by the end of 2025 at the latest. The strong organic growth figures in 2021 demonstrate that the Group has the capacity to expand its activities on its own. In combination with targeted acquisitions that tap into new markets, segments or skills, ABO-GROUP is well positioned to deliver the technical market leadership it is aiming for in its domestic markets.

Financial calendar

22/04/2022: Publication of the 2021 annual report and invitation to the General Meeting
25/05/2021: General Meeting
16/09/2021: Figures for the first half of 2022

Statement of the statutory auditor

The statutory auditor, EY Bedrijfsrevisoren BV, represented by Paul Eelen, has confirmed that the audit, which is substantially complete, has to date not revealed any material misstatement in the consolidated income statement, the consolidated statement of comprehensive income, the consolidated balance sheet, the consolidated statement of changes in equity or the consolidated statement of cash flow as included in this press release.

About the ABO-GROUP

ABO-GROUP is a specialised, listed engineering office focussing on geotechnology, environment and soil remediation. Through its Consultancy and Testing & Monitoring departments, ABO-GROUP operates in Belgium, the Netherlands and France, as well as internationally. ABO-GROUP guarantees its clients a sustainable solution. Please consult the ABO-GROUP website (www.abo-group.eu) for a more detailed description of the activities of the Group.

For more information:

Frank De Palmenaer
CEO ABO-Group Environment NV
frank.depalmenaer@abo-group.eu
T: +32 (0)9 242 88 66

Derbystraat 255, Maaltecenter Blok G, B-9051 Ghent (SDW), Belgium

This press release is available on our website www.abo-group.eu

Attachment

• ABO-Group Environment annual results 2021