EQS Group-Ad-hoc: Airopack Technology Group AG / Key word(s): Annual Results
Airopack Technology Group AG: Airopack reports Financial Year 2018 results
and restates the consolidated financial statements for the first half of
2018
01-Jul-2019 / 23:50 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.
Ad-hoc release / Press Release
*Airopack reports Financial Year 2018 results and restates the consolidated
financial statements for the first half of 2018*
*- In 2018, net sales decreased by 12.1% to EUR 18.9 million*
*- EBITDA deteriorated by EUR 8.0 million compared to 2017 and came to EUR
-29.0 million*
*- Net loss of EUR 57.8 million related to lagging sales, high amount of
overhead including exceptional cost of EUR 3.0 million, and increased
investments in organisation and production capacity*
*- The H1 2018 financials as reported on 30 September 2018 are restated
after internal investigations of the financial statements and past
management practices as disclosed in the ad-hoc press release dated 16
January 2019 *
*- As of 18 March 2019, all operating activities of Airopack Technology
Group AG were carved out to the major lenders*
*- Airopack Technology Group AG under definitive composition moratorium
since 5 June 2019 as reported in the ad-hoc press release dated 6 June 2019*
*- The company's statutory auditor BDO has issued a disclaimer of opinion in
its audit letter on the consolidated accounts*
*Baar, 1 July 2019 - Airopack Technology Group AG ("Airopack"), today
announced its results for full year 2018. *
The net sales for the year 2018 decreased by 12.1% compared to the previous
year, totaling EUR 18.9 million. This is a direct result of the stagnating
sales of Airopack units. The operating results deteriorated sharply against
the 2017 results, with EBITDA decreasing by EUR 8.0 million. Lagging sales,
high level of overhead including exceptional cost of EUR 3.0 million and
investments in ramping up production capacity explain the negative EBITDA of
EUR -29.0 million. The capacity increase led to increased charges for
depreciation (2018: EUR -7.1 million), which, combined with the cost for
amortization (2018: EUR -14.4 million) and interest costs (2018: EUR -12.0
million), resulted in a net loss of EUR 57.8 million.
*Full Year - Key Figures*
in TEUR in TEUR
*2018* *2017*
*Consolidated income statement*
Net sales 18'885 21'484
EBITDA -28'963 -21'000
EBIT -53'420 -35'873
Net result -57'778 -40'098
Net result per share in EUR -2.90 -2.11
*Consolidated balance sheet*
Shareholders' equity -86'803 -23'211
Balance sheet total 141'677 127'588
The company's statutory auditor BDO has issued a disclaimer of opinion in
its audit letter on the consolidated accounts. A disclaimer of opinion means
that BDO cannot give an opinion on the annual accounts as a whole due to
lack of audit evidence (uncertainties during the audit) on one or more parts
of the annual accounts. This has possible significant impact on the annual
accounts 2018.
The full 2018 annual report is available for download on the Airopack
website (www.airopackgroup.com [1]) under the link - investor relations -
reports (www.airopackgroup.com/en/investor-relations/reports [2]).
*Events after closing date
Review of financial statements and past management practices*
The new management team under the lead of the Chairman of the Board of
Directors took over on 1 December 2018 and initiated an investigation and
review of Airopack's financial statements and past management practices. Due
to certain findings by this management team, Airopack retained
PricewaterhouseCoopers Ltd. ("PwC").
PwC found that revenues in 2018 had been overestimated by former management,
including the first half-year period. In addition, former management had
entered into previously undisclosed liabilities, such as buy-back
commitments towards customers.
PwC's work has identified and corroborated with the new management's view of
a range of financial misreporting by the former management team, including:
- Revenue recorded without valid purchase orders or similar requests from
customers
- Work in progress recorded without valid purchase orders
- Revenue recorded without recognising provisions for buy-back clauses or
discounts offered as part of negotiations
- Revenue recognised without reasonable assurance that payment would be made
by customers
The new Management therefore needed to consider the required accounting
entries to address these issues and also needed to take into account
additional financial implications of any adjustments made, in accordance
with Swiss GAAP FER, including: provisions, stock value write downs,
buy-back transportation costs, debtor write offs, foreign exchange risk and
tax implications.
*Data and security*
In addition to PwC's financial review, they have undertaken significant work
to investigate the IT environment, and provided new management with
recommendations on how to gain control of this environment and to secure the
company's electronic records.
PwC has secured 1,004 Gigabytes ("GB") of data, processed 131 GB and
reviewed 2,980 emails and other electronic documentation to provide evidence
to support the financial review, and to provide further information and
evidence for new management as they sought to understand and stabilise the
business.
1. *Moratorium*
The major lenders did not waive the events of default under the Facilities
Agreement which were continuing since 31 January 2019. On this basis, on
Saturday, 9 February 2019, the major lenders accelerated the loans
outstanding under the Facilities Agreement. The acceleration notice included
a demand for repayment of the loans from Airopack under the guarantee given
by it. On 11 February 2019, Airopack was served with a notice that the major
lenders initiated steps to enforce the pledges and other security interests
granted by members of the Airopack Group. On 12 February 2019, the Cantonal
Court of Zug granted Airopack's request for a provisional composition
moratorium of an initial duration of two months and a provisional
administrator was appointed. This provisional composition moratorium was
extended for an additional two months on 10 April 2019 and on 5 June 2019,
the Cantonal Court of Zug granted a definitive composition moratorium for
four months until 14 October 2019 (may be extended) and a definitive
administrator was appointed.
2. *IPS B.V. carve-out*
The Dutch court granted permission for the enforcement of the pledge over
the shares in Airopack's indirect Dutch subsidiary I.P.S. B.V., as requested
by the major lenders on 8 March 2019. Subsequently, on 18 March 2019
Airopack Technology Group AG and its direct subsidiary I.P.S. Holding B.V.
were separated from the operating subsidiaries of Airopack Group. Based on
the valuation of the operating subsidiaries as approved by the Dutch court,
the pledgor I.P.S. Holding B.V. did not receive any proceeds from the
enforcement and guarantee liabilities remain outstanding towards the major
lenders by Airopack Technology Group AG and I.P.S. Holding B.V.
Due to the separation of the operating companies from Airopack, the chairman
of the Board of Directors of Airopack assumes all relevant management
responsibilities of the company. Jean-Baptiste Lucas remains CEO and Andre
de Oliveira remains COO of the operating companies that meanwhile have been
taken over by the major lender. Emmanuel Walter CFO ad interim, will resign
from the company after the finalization of the Annual Report 2018.
*Restatement of the consolidated financial statements for the first half of
2018*
Based on the report from the investigation performed by PwC, management has
analysed the consolidated financials for the first half of 2018, as reported
on 30 September 2018, and has come to the conclusion that the consolidated
financials need to be restated.
Operating income restated downwards by EUR 2.2 million as sales were
reported which were subject to buy-back clause, consignment stock
adjustments and adjustments due to revenues without customer orders that
were not taken into account (in the ad-hoc press release dated 16 January
2019 it was expected that revenues need to be adjusted downward in the range
of approx. EUR 4 million to EUR 5 million). The operating expenses have been
restated downwards by EUR 1.1 million, mainly related to a correction in
cost of sales related to the restatement of net sales.
The restatements have a negative impact on the reported EBITDA of EUR 1.2
million and a negative impact on the net result of EUR 2.8 million.
*Half- Year - Key Figures *
in TEUR in TEUR in TEUR
*HY
*HY 2018 1)* *HY 2018 1)* 2017*
*Restated *
*Unaudited*
*Consolidated income statement*
Operating Income 12'558 14'795 11'835
Operating expense -24'903 -25'959 -22'225
EBITDA -12'344 -11'164 -10'390
EBIT -22'498 -20'455 -17'712
Net result -26'309 -23'549 -19'533
Net result per share in EUR -1.32 -1.18 -1.06
*Consolidated cash flow* -6'453 -6'453 3'814
*Consolidated balance
sheet*
Cash and cash equivalents 793 793 12'157
Shareholders' equity -52'197 -46'696 -16'336
Balance sheet total 134'475 135'539 98'292
*Contacts:*
Airopack Technology Group AG
Antoine Kohler, Chairman
Blegistrasse 5/1 OG
CH-6340 Baar
TF: +41 41 768 50 50
www.airopackgroup.com [1]
For investors:
Airopack Technology Group AG
Martin Eberhard
martin.eberhard@rimesa.ch
TF: +41 79 209 77 50
For media:
Tolxdorff Eicher Kollektivgesellschaft
Daniel Eicher / Theresia Tolxdorff
partners@tolxdorffeicher.ch
TF: +41 44 718 25 25
*Disclaimer*
This Ad Hoc Release / Press Release may contain certain
forward-looking statements. In some cases forward looking
statements can be identified by the use of terms such as
"believes", "enables", "estimates", "anticipates", "projects",
"expects", "intends", "may", "will", "seeks" or "should" or
variations thereof, or by discussions of strategy, plans,
objectives, goals, future events or intentions. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances.
Actual outcomes and results may differ materially from any
outcomes or results expressed or implied by such forward-looking
statements. The success or achievement of various results,
targets and objectives is dependent upon a multitude of factors,
many of which are beyond the control of Airopack. No
representations are made as to the accuracy of such statements
or that such results, targets or objectives will be realized.
www.airopackgroup.com
End of ad hoc announcement
Language: English
Company: Airopack Technology Group AG
Blegistrasse 5
6340 Baar
Switzerland
Phone: +41 417663500
Fax: +41 417663509
E-mail: liebwin.vanlil@airopackgroup.com
Internet: www.airopackgroup.com
ISIN: CH0242606942
Listed: SIX Swiss Exchange
EQS News ID: 834259
End of Announcement EQS Group News Service
834259 01-Jul-2019 CET/CEST
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(END) Dow Jones Newswires
July 01, 2019 17:50 ET (21:50 GMT)
