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ABEO, a leading global supplier of sports and leisure equipment, has reviewed the current impact of the COVID-19 epidemic and the postponement of the Tokyo Olympic Games.
As a reminder, the ABEO Group is organised into different regions worldwide, with production units in Europe (France, Germany, Spain, Netherlands and UK), China, Canada, USA and New Zealand. This organisational structure helps the Group to provide locally based supply services to customers.
Against today's backdrop of the COVID-19 pandemic, ABEO has been applying all preventive sanitary measures to protect its employees' health, in liaison with the authorities in each country where the Group operates.
Lockdown measures have gradually become widespread throughout the world, affecting the business of many of ABEO's customers. Although equipment installation has mostly been put on hold for the time being, the Group's employees are constantly in touch with customers and partners to coordinate a return to operations as soon as possible.
In France and the UK, production has slowed or been progressively suspended as the demand was impacted by stringent containment measures. In contrast, in the other geographic areas where it operates, the Group continues to operate at more than half of its capacity, sometimes even at full capacity.
In China, industry is gradually resuming, more than two months after the crisis began.
In every country where it is possible, the Group has applied part-time work measures or partial unemployment schemes. Furthermore, all financial support offered by public authorities is currently under review, especially in France with the country's BPI public investment bank, to offset effects of the downturn and protect resources during this period.
Lastly, a work-from-home policy has been introduced for all eligible jobs in the Group and its subsidiaries.
Review of 2019/20 financial year
The first two months of Q4 2019/20 (1 January – 31 March 2020) was marked by a step-up in organic growth, which amounted to 5.5% for January and February combined, in line with short-term forecasts and the Group's medium-term goal.
For the 11-month period from 1 April 2019 to 29 February 2020, ABEO posted a 7.3% growth in business (1.3% organic growth), despite the impact of Cannice's repositioning in China, the slowdown in demand due to Brexit in the UK subsidiaries, and, above all, the level of business at its US subsidiary Fun Spot (slow conversion of open orders into revenues).
In March, the business momentum observed was then suddenly interrupted by today's extraordinary health crisis.
For the year 2019/20 (ended 31 March 2020), the Group's level of business will therefore probably be below forecasts and revenue is estimated to be around €235m (versus €230m for the previous year). Covid-19 will automatically affect the recurring EBITDA1 margin expected for March.
Because the crisis is a changing situation and will last for an unknown duration, it is currently difficult to quantify effects on business over the coming months of the 2020/21 financial year. To date, ABEO has not faced any cancellation of orders but has had to postpone a number of roll-outs due to movement restrictions and site closures.
In order to preserve its operating margins, ABEO has also implemented part-time work measures (partial unemployment or equivalent in other countries) and an external cost-reduction plan (marketing, projects, etc.)
The Group has many strengths and can count on a proven capacity to adapt quickly. This will enable it to get through the current crisis by taking the required measures to cut expenditure and to adjust capacities in order to support the resumption of normal business on its markets in due course.
Tokyo Olympic Games postponed
Given the current context, the 32nd Olympic Games in Tokyo have been postponed and rescheduled to take place from 23 July to 8 August 2021.
ABEO would like to underline that most of its equipment is already on site for the test events and that this competition does not directly contribute to the Group's business. The Group provides sports equipment and maintenance and, after the Games, takes back or resells the equipment.
For this global sports event, ABEO brands will be present as suppliers in three disciplines: Schelde Sports for basketball equipment, Spieth Gymnastics for artistic and rhythmic gymnastics equipment, and Entre-Prises for climbing structures. The Group therefore obtained all the contracts for which it was able to compete. This makes the Olympic Games a great showcase for ABEO's brands and expertise.
ABEO CEO Olivier Estèves said: “The new schedule for the Tokyo Olympic Games in 2021 will give world-class athletes the time they need for training and competitions. The Group's expertise – the perfect fit for highly demanding competitions, both in quality and installation – will be back in business in 2021.”
“Under the current circumstances, our priority is to ensure that all our employees stay healthy. I would like to highlight the capacity for adaptation shown by our staff over the recent period. Their dedication is what will enable us to bounce back. In over 60 years of existence, our family group has already gone through different crises and proved its ability to recover each time.”
18 May 2020 before start of trading 2019/20 annual revenue
Find out more at www.abeo-bourse.com
|ABEO is a major player in the sports and leisure market. The Group posted turnover of € 230.4 million for the year ended 31 March 2019, 77% of which was generated outside France, and has more than 1,700 employees.
ABEO is a designer, manufacturer and distributor of sports and leisure equipment. It also provides assistance in implementing projects to professional customers in the following sectors: specialised sports halls and clubs, leisure centres, education, local authorities, construction professionals, etc.
ABEO has a unique global offering, and operates in a wide variety of market segments, including gymnastics apparatus and landing mats, team sports equipment, physical education, climbing walls, leisure equipment and changing room fittings. The Group has a portfolio of strong brands which partner sports federations and are featured at major sporting events, including the Olympic Games.
ABEO (ISIN code: FR0013185857, ABEO) is listed on Euronext Paris – Compartment C.
For any questions relating to this press release or the ABEO Group, please contact ACTUS finance & communication
Investor relations – Corinne Puissant [email protected] Tel: +33 (0)1 53 67 36 77
Press relations – Serena Boni [email protected] Tel: +33 (0)4 72 18 04 92
1 Recurring operating income + depreciation of fixed assets