DJ HMS Group Reports Rub 6.7 billion EBITDA for FY 2021
HMS Group (HMSG) HMS Group Reports Rub 6.7 billion EBITDA for FY 2021 29-Apr-2022 / 13:16 MSK Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.
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HMS Group Reports Rub 6.7 billion EBITDA for FY 2021
Moscow, Russia - April 29, 2022 - HMS Hydraulic Machines & Systems Group Plc (the "HMS Group", or the "HMS", or the "Group") (LSE, MOEX: HMSG), the leading pump, oil & gas equipment and compressor manufacturer and provider of flow control solutions and related services in Russia and the CIS, today announces its financial results for the full year ended December 31, 2021.
Financial highlights FY 2021:
-- Revenue: Rub 57.2 bn (+23% yoy)
-- EBITDA[1]: Rub 6.7 bn (+36% yoy), EBITDA margin at 11.8%
-- Operating profit: Rub 3.8 bn (+116% yoy)
-- Profit for the period: Rub 1.2 bn
-- Total debt: Rub 22.7 bn (+2% yoy)
-- Net debt: Rub 13.9 bn (+18% yoy)
-- Net debt-to-EBITDA LTM ratio: 2.07x
Operational highlights FY 2021:
-- Order intake[2]: Rub 47.7 bn (-12% yoy)
-- Backlog[3]: Rub 42.3 bn (-22% yoy)
HMS GROUP PERFORMANCE
FY 2021 financial Results
-- Order intake was down to Rub 47.7 billion, by 12% yoy, compared with Rub 54.2 billion for FY 2020, mainlydue to less large contracts signed in the reporting period. All business segments grew except the compressors. Interms of contracts type, large contracts were down.
-- Backlog was Rub 42.3 billion, down by 22% yoy, compared with Rub 53.9 billion at the end of 2020, but inthe same time the company is working on a number of opportunities in 2022. In terms of contracts type, bothrecurring business and large contracts decreased.
-- Revenue grew to Rub 57.2 billion by 23% yoy, compared with Rub 46.5 billion for FY 2020, based on revenuegrowth in all business segments except the pumps.
-- EBITDA was Rub 6.7 billion, up by 36% yoy, implying EBITDA margin of 11.8%.
-- Revenue from large contracts grew 66% yoy, and revenue from recurring business was up by 5% yoy. EBITDAfrom large contracts increased 91% yoy, while EBITDA from recurring business declined 12% yoy.
-- Profit for the period was Rub 1.2 billion, compared with loss for the period at Rub 816 million for FY2020.
-- Free cash outflow was Rub 1.0 billion, compared with free cash inflow of Rub 3.0 billion for FY 2020, dueto the higher working capital requirements for execution of large contracts that are within the normal quarterlyvolatility.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Orders 47,680 54,205 -12% 10,846 5,951 82% Backlog 42,264 53,851 -22% 42,264 47,259 -11% Revenue 57,159 46,476 23% 16,038 15,326 5% EBITDA 6,723 4,947 36% 1,526 2,341 -35% EBITDA margin 11.8% 10.6% 9.5% 15.3% Profit for the year/period 1,241 (816) na 32 831 -96% Free cash flow (982) 2,958 na 3,491 231 1,414%
Expenses and Operating profit - Cost of sales was Rub 45.7 billion, up by 23% yoy, in line with revenue growth, compared with Rub 37.1billion for FY 2020, mainly due to the growth in materials and components costs (+26% yoy).
in millions of Rub 2021 2020 Change yoy Share of FY 2021 revenue Share of FY 2020 revenue Cost of sales 45,737 37,071 23% 80.0% 79.8% Materials and components 30,023 23,760 26% 52.5% 51.1% Labour costs incl Social taxes 7,673 6,906 11% 13.4% 14.9% Depreciation and amortization 2,087 2,122 -2% 3.7% 4.6% Construction and design [4] 3,643 2,557 42% 6.4% 5.5% Others 2,310 1,726 34% 4.0% 3.7% - Gross profit grew to Rub 11.4 billion, by 21% yoy, compared with Rub 9.4 billion for FY 2020. - SG&A expenses[5] were up 4% yoy.
Distribution & transportation expenses were down 9% yoy due to lower transportation costs (-28% yoy). As a share of revenue, distribution & transportation expenses declined to 3.1%, compared with 4.3% for FY 2020.
General & administrative expenses were up to Rub 5.7 billion (+9% yoy) mainly due the growth in labour costs incl. social taxes (+15% yoy). As a share of revenue, general & administrative expenses were down to 10.0%, compared with 11.3% for FY 2020. - Operating profit was up to Rub 3.8 billion (+185% yoy), compared with Rub 1.3 billion for FY 2020.
in millions of Rub 2021 2020 Change yoy Share of FY 2021 revenue Share of FY 2020 revenue Gross profit 11,423 9,405 21% 20.0% 20.2% Distribution & transportation 1,799 1,986 -9% 3.1% 4.3% General & administrative 5,704 5,243 9% 10.0% 11.3% SG&A expenses 7,503 7,228 4% 13.1% 15.6% Other operating expenses 111 412 -73% 0.2% 0.9% Operating expenses ex. Cost of sales 7,614 7,641 0% 13.3% 16.4% Operating profit 3,809 1,338 185% 6.7% 2.9% Finance costs 1,976 1,926 3% 3.5% 4.1% - Finance costs increased to Rub 2.0 billion, up by 3% yoy, mainly due to a growth in interest expenses(+2% yoy) because of higher interest rates, compared with FY 2020. - Average interest rate grew to 9.91% p.a., compared with 8.00% p.a. last year. in millions of Rub 2021 2020 Change yoy Finance costs 1,976 1,926 3% Interest rate, average 9.91% 8.00% Interest rate Rub, average 10.03% 8.12%
BUSINESS SEGMENTS PERFORMANCE
Industrial pumps - Order intake was Rub 22.2 billion, up by 25% yoy, compared with Rub 17.8 billion for FY 2020, due to boththe large long-term contract signed in 2Q 2021 and a growth in recurring orders. - Backlog was Rub 20.9 billion, up 14% yoy, compared with Rub 18.2 billion at the end of FY 2020, based onlarge contracts and recurring business. - Revenue was down to Rub 20.0 billion (-2% yoy), compared with Rub 20.3 billion for FY 2020. - EBITDA was down 16% yoy to Rub 2.5 billion, compared with Rub 2.9 billion for FY 2020, due to lessrevenue generated by both recurring business and large contracts. EBITDA margin was 12.3%, compared with 14.5%during FY 2020.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Orders 22,245 17,773 25% 5,747 4,003 44% Backlog 20,851 18,227 14% 20,851 21,753 -4% Revenue 19,951 20,256 -2% 6,804 5,157 32% EBITDA 2,455 2,931 -16% 910 711 28% EBITDA margin 12.3% 14.5% 13.4% 13.8%
Oil and Gas equipment & projects (OGEP) - Order intake grew to Rub 17.9 billion, up by 32% yoy, compared with Rub 13.6 billion during FY 2020, dueto large contracts signed in the reporting period. - Backlog stayed almost unchanged at Rub 9.3 billion, supported by large contracts. - Revenue grew to Rub 18.4 billion, up by 63% yoy, compared with Rub 11.3 billion for FY 2020, due to largecontracts. - EBITDA increased to Rub 1.8 billion, up by 653% yoy, compared with Rub 241 million for FY 2020 mainly dueto a larger share of large contracts in the reporting period. EBITDA margin was 9.9%, compared with 2.1% for FY2020.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Orders 17,886 13,568 32% 2,511 1,348 86% Backlog 9,278 9,318 0% 9,278 11,697 -21% Revenue 18,425 11,284 63% 5,057 5,027 1% EBITDA 1,818 241 653% 425 575 -26% EBITDA margin 9.9% 2.1% 8.4% 11.4%
Compressors - Order intake declined to Rub 5.5 billion, down by 76% yoy, compared with Rub 22.6 billion for FY 2020,due to less large contracts signed in the reporting period. - Backlog was Rub 11.4 billion, down by 54% yoy, compared with Rub 24.8 billion at the end of 2020. - Revenue grew to Rub 19.9 billion, up by 33% yoy, compared with Rub 14.9 billion for FY 2020. - EBITDA increased to Rub 2.5 billion, up by 31% yoy, compared with Rub 1.9 billion for FY 2020. EBITDAmargin was down to 12.8%, compared with 13.0% for FY 2020.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Orders 5,533 22,617 -76% 2,570 581 342% Backlog 11,419 24,765 -54% 11,419 12,897 -11% Revenue 19,891 14,947 33% 4,634 5,330 -13% EBITDA 2,537 1,939 31% 488 1,071 -54% EBITDA margin 12.8% 13.0% 10.5% 20.1%
Construction - Order intake equaled Rub 2.0 billion. Backlog was down to Rub 0.7 billion. - Revenue was up to Rub 898 million, compared with Rub 718 million for FY 2020. EBITDA was Rub 51 million,compared with Rub (63) million last year.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Orders 2,017 247 718% 17 19 -8% Backlog 716 1,541 -54% 716 911 -21% Revenue 898 718 25% 221 319 -31% EBITDA 51 (63) na 24 48 -50% EBITDA margin 5.7% -8.8% 10.9% 15.1% Working capital and Capital expenditures - Working capital increased to Rub 10.0 billion (+49% yoy), compared with Rub 6.8 billion at the end of2020. Working capital changes are within the normal quarterly volatility. - As a share of revenue, working capital was at 17.6% vs. 14.5% at the end of 2020. - Maintenance capex was Rub 1.4 billion, down by 1% yoy. in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Working capital 10,047 6,752 49% 10,047 13,390 -25% Working capital / Revenue LTM 17.6% 14.5% 17.6% 23.9% Maintenance capex 1,384 1,392 -1% 374 353 6% Acquisitions - - - -
DEBT POSITION - Total debt was up 2% yoy to Rub 22.7 billion, compared with Rub 22.2 billion at the end of 2020. - Net debt was Rub 13.9 billion (+18% yoy), compared with Rub 11.8 billion at the end of 2020. - Net debt to EBITDA LTM ratio was 2.07x, down from 2.39x at the end of 2020.
in millions of Rub 2021 2020 Change yoy 4Q 2021 3Q 2021 Change qoq Total debt 22,668 22,175 2% 22,668 22,642 0% Net debt 13,896 11,814 18% 13,896 16,771 -17% Net debt / EBITDA LTM 2.07 2.39 2.07 2.48
SIGNIFICANT EVENTS AFTER THE REPORTING DATE - On March 3, 2022, the London Stock Exchange has suspended the admission to trading of the Company's GDRs.
DEBT MANAGEMENT - In March 2022, based on the Federal Law - 71-FZ dated 26 March 2022, the Group fixed for the three monthsthe interest rates of its total Rub-denominated floating rate borrowing portfolio in amount of Rub 3.9 billion at12.5%, 13.5% and 16.5% per annum for the April, May and June 2022, respectively. - In April 2022, the Group signed preferential credit facility agreements in the total amount of Rub 4.9billion at 11% per annum with 1-year maturity for financing its operational needs. - As of April 1, 2022, HMS Group has only Rub 187 million to be repaid in 2022. - The average interest rate grew to 10.15% per annum as of April 1, 2022.
in millions of Rub 2022 2023 2024 2025 Debt to be repaid as of April 1, 2022 187 9,994 11,517 281
CONTRACTS - In February 2022, HMS Group announced the signing of Rub 7.0 billion contract to manufacture and deliveroil & gas equipment in 2023-2025. - In April 2022, HMS Group announced the signing of Rub 3.3 billion contract to manufacture and deliver gastransportation units in 2023-2024 to a gas condensate field located in Russia.
BUYBACK PROGRAM - After the reporting date, no GDRs have been purchased under the buyback program. The company holds257,960 of its GDRs in treasury (1.1% of its issued share capital).
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Contacts:
Investor Relations, ir@hms.ru
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HMS Group is the leading pump and compressor manufacturer, as well as provider of flow control solutions and related services to the oil and gas, nuclear and thermal power generation and water utilities sectors in Russia and the CIS. HMS Group's products are mission-critical elements of projects across a diverse range of industries. It has participated in a number of large-scale infrastructure projects in Russia, including providing pumps and modular equipment to the Vankor oil field and pumping stations on recent trunk pipelines projects linking Russia's core oil producing areas to export ports on the Pacific Ocean and Baltic Sea. HMS Group's global depositary receipts ("GDRs") are listed under the symbol "HMSG" on the London Stock Exchange and the Moscow Exchange.
Press Release Information Accuracy Disclaimer
Information published in press releases was accurate at the time of publication but may be superseded by subsequent releases or other information.
LEI: 254900DDFETNLASV8M53
HMS Hydraulic Machines & Systems Group plc
Consolidated Statement of Financial Position at 31 December 2021
(in thousands of Russian Roubles, unless otherwise stated)
31 31
December December
2021 2020
ASSETS
Non-current assets:
Property, plant and equipment 14,045,362 14,684,279
Other intangible assets 1,429,904 1,743,399
Goodwill 3,159,502 3,255,984
Right-of-use assets 414,861 183,211
Investments in associates 95,358 94,307
Deferred income tax assets 827,200 786,455
Other long-term assets 21,606 42,252
Investment property 140,598 176,833
Total non-current assets 20,134,391 20,966,720
Current assets:
Inventories 9,067,145 8,847,749
Trade and other receivables and other financial assets 17,050,792 15,598,766
Contract assets 9,718,947 6,201,354
Current income tax receivable 72,588 94,972
Cash and cash equivalents 8,771,642 10,360,588
Total current assets 44,681,114 41,103,429
TOTAL ASSETS 64,815,505 62,070,149
EQUITY AND LIABILITIES
EQUITY
Share capital 48,329 48,329
Share premium 3,523,535 3,523,535
Treasury shares (93,775) (33,055)
Other reserves 129,392 129,392
Currency translation reserve 566,766 646,427
Retained earnings 5,856,944 5,510,974
Equity attributable to the shareholders of the Company 10,031,191 9,825,602
Non-controlling interests 3,699,312 3,518,674
TOTAL EQUITY 13,730,503 13,344,276
LIABILITIES
Non-current liabilities:
Long-term borrowings 21,649,561 20,452,736
Deferred income tax liability 1,445,176 1,421,489
Retirement benefit obligations 612,140 646,213
Provisions for liabilities and charges 316,506 228,199
Lease liabilities 346,376 153,048
Other long-term payables 228,282 230,581
Total non-current liabilities 24,598,041 23,132,266
Current liabilities:
Trade and other payables 21,729,699 17,969,950
Contract liabilities 2,323,511 4,304,845
Short-term borrowings 611,966 1,548,574
Provisions for liabilities and charges 599,184 589,762
Retirement benefit obligations 73,582 77,859
Lease liabilities 59,928 20,440
Current income tax payable 240,953 134,080
Other taxes payable 848,138 948,097
Total current liabilities 26,486,961 25,593,607
TOTAL LIABILITIES 51,085,002 48,725,873
TOTAL EQUITY AND LIABILITIES 64,815,505 62,070,149
HMS Hydraulic Machines & Systems Group plc
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 31 December 2021
(in thousands of Russian Roubles, unless otherwise stated)
2021 2020
Revenue 57,159,315 46,476,487
Cost of sales (45,736,646) (37,071,430)
Gross profit 11,422,669 9,405,057
Distribution and transportation expenses (1,798,784) (1,985,928)
General and administrative expenses (5,704,013) (5,242,566)
Other operating expenses, net (110,916) (412,472)
Impairment of goodwill - (425,668)
Operating profit 3,808,956 1,338,423
Finance income 181,591 251,571
Finance costs (1,976,275) (1,926,310)
Share of results of associates (470) (161)
Profit/(loss) before income tax 2,013,802 (336,477)
Income tax expense (772,783) (479,814)
Profit/(loss) for the year 1,241,019 (816,291)
Profit/(loss) attributable to:
1,032,202
Shareholders of the Company (971,996)
Non-controlling interests 208,817 155,705
Profit/(loss) for the year 1,241,019 (816,291)
Other comprehensive (loss)/income:
Items that will not be subsequently reclassified to profit or loss
Remeasurement of post-employment benefit obligations 49,232 (5,321)
Items that may be reclassified subsequently to profit or loss
Currency translation differences (71,684) 693,105
Currency translation differences of associates 1,521 (21)
Other comprehensive (loss)/income for the year (20,931) 687,763
Total comprehensive income/(loss) for the year 1,220,088 (128,528)
Total comprehensive income/(loss) attributable to:
981,741 (288,238)
Shareholders of the Company
Non-controlling interests 238,347 159,710
Total comprehensive income/(loss) for the year 1,220,088 (128,528)
8.90 (8.50)
Basic and diluted profit/(loss) per ordinary share for profit/(loss)
attributable to the ordinary shareholders (RR per share)
HMS Hydraulic Machines & Systems Group plc
Consolidated Statement of Cash Flows for the year ended 31 December 2021
(in thousands of Russian Roubles, unless otherwise stated)
2021 2020
Cash flows from operating activities
Profit/(loss) before income tax 2,013,802 (336,477)
Adjustments for:
Depreciation and amortisation 2,424,217 2,451,191
Gain from disposal of property, plant and equipment and intangible assets (84,044) (1,821)
Finance income (181,591) (251,571)
Finance costs 1,976,275 1,926,310
Change in retirement benefits obligations 36,821 82,075
Change in warranty provision 112,329 136,752
Change in expected credit losses allowances for financial assets and allowance for 50,299 104,002
impairment of non-financial assets
Change in allowance for obsolete inventories 146,044 10,598
Change in provision for legal claims 58,846 83,987
Share-based compensation 25,000 58,921
Foreign exchange (gain)/loss, net (76,165) 73,534
Amortisation of government grants (37,528) (36,048)
Impairment of taxes - 10,418
Impairment of goodwill - 425,668
Impairment of property, plant and equipment - 13,936
Change in provision for tax risks, other than income tax 15,667 9,898
Share of results of associates 470 161
Operating cash flows before working capital changes 6,480,442 4,761,534
Increase in inventories (325,574) (869,830)
(Increase)/decrease in trade and other receivables (1,281,589) 2,967,741
(Increase)/decrease in contract assets (3,506,361) 1,916,049
Increase/(decrease) in accounts payable and accrued liabilities 3,397,639 (3,361,448)
(Decrease)/increase in contract liabilities (1,947,373) 2,056,816
Decrease in taxes payable (101,761) (683,045)
Cash from operations 2,715,423 6,787,817
Income tax paid (644,282) (820,008)
Interest paid (1,952,685) (1,887,821)
Interest received 178,458 259,533
Net cash from operating activities 296,914 4,339,521
Cash flows from investing activities
Repayment of loans advanced 5,172 6,953
Loans advanced (39,879) (20,203)
Proceeds from sale of property, plant and equipment and intangible assets, net 140,659 55,948
Purchase of property, plant and equipment, net of VAT (1,075,212) (937,132)
Acquisition of intangible assets, net of VAT (309,217) (454,417)
Repayment of contingent consideration liability - (33,000)
Net cash used in investing activities (1,278,477) (1,381,851)
Cash flows from financing activities
Repayments of borrowings (13,534,754) (11,478,749)
Proceeds from borrowings 13,820,510 9,127,605
Proceeds from government grant - 28,092
Repayment of the lease liabilities principal (24,852) (35,905)
Buy back of issued shares (60,720) (1,705)
Dividends related to Long-term Incentive Program - (5,660)
Dividends paid to non-controlling shareholders of subsidiaries (56,909) (55,162)
Dividends paid to the shareholders of the Company (740,432) (391,942)
Net cash used in financing activities (597,157) (2,813,426)
Net (decrease)/increase in cash and cash equivalents (1,578,720) 144,244
Effect of exchange rate changes on cash and cash equivalents and effect of translation to (10,226) 296,076
presentation currency
Effect of changes in expected credit losses allowance for cash and cash equivalents - (31,850)
Cash and cash equivalents at the beginning of the year 10,360,588 9,952,118
Cash and cash equivalents at the end of the year 8,771,642 10,360,588
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[1] EBITDA is defined as operating profit/(loss) adjusted for other operating income/expenses, depreciation and amortisation, amortisation of government grants, impairment of assets, excess of fair value of net assets acquired over the cost of acquisition, defined benefits scheme expense and provisions (including provision for obsolete inventory, ECL allowance and provision for impairment of trade and other receivables and other financial assets, unused vacation allowance, warranty provision, provision for legal claims, tax provision and other provisions). This measurement basis, therefore, excludes the effects of a number of non-recurring income and expenses on the results of the operating segments.
[2] Order intake - Portfolio of contracts and orders signed for a period
[3] Backlog - Portfolio of uncompleted orders and contracts
[4] Construction and design and engineering services of subcontractors
[5] SG&A expenses - Selling, General and Administrative Expenses, compiled of distribution & transportation expenses plus general & administrative ones
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ISIN: US40425X4079 Category Code: ACS TIDM: HMSG LEI Code: 254900DDFETNLASV8M53 OAM Categories: 1.1. Annual financial and audit reports Sequence No.: 158691 EQS News ID: 1339849 End of Announcement EQS News Service =------------------------------------------------------------------------------------
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April 29, 2022 06:17 ET (10:17 GMT)
