Wendel

Good morning to everybody. Thank you for joining us through Visio or being here in the room for this 2020, 2023 full year result of Vandel. Very happy to To be in front of you with David, we will present you the earnings of Vandel for the year 2023, an important year for Vandel. Benoit Adriault, our CFO, will be there also to present you the numbers. And after the presentation, we'll be happy to answer to any of the questions that you may have. Again, I'm very pleased to be with you. It has been, it's the first time, not I'm presenting the earnings, but the first full year earnings I'm presenting for Vandel. 2023, I think I have to move the slides. 2023 has been an exciting year and a year of a lot of action and transformation for Vandel. As you remember, when we last met for a live physical presentation like this one, it was in March 2023, where we presented the new strategy of Vendel. Since then, I think we've been very active in making sure that we can implement that strategy and implement. and start to transform Vendel. Obviously, everything has not been done. There's much more to be done. And you can trust the fact that the full Vendel team is very mobilized in order to achieve the goals and the ambitious goal that we've set to ourselves. What have we done in 2023? So let's look at it with three angles. First on the Principal investment, you know, we've presented the dual model where we have on one side investing the capital long term of Vandel and the other side, as you know, we're developing an asset management business. So let's focus first on the principal investment. We've been pretty active during the year with a significant turnover of our assets. We've made the acquisition of Scallion, which was announced recently. in July last year and since then closed and integrated Secalio throughout our organization. We've sold Constantia Flexible which was again announced during the summer and closed early January this year. and the Wendell Gross team has made four different investments in the year. Within our portfolio companies, Stahl has been active in both starting to, I mean, implementing the new strategy which is to shift the Stahl from a laser treatment company to a specialty coating company and I think the acquisition of ISG has been a very successful one and David will come back on how it has developed since then and Stahl also had made a special dividend to all his shareholders at the end of last year which ended up at 85 million dividends to uh, um, uh, whatever. Globally, the other point that we have to see in the principal investment is that the growth of our companies has been very solid during the year, 6.5% organic growth, and that is, I think, a great illustration of the quality of the business we've invested in, and the fact that we're, despite an environment which was not so easy in 2023, we're We're very happy about the growth trajectory and very optimistic for the future in our ability to deliver value through this investment. Obviously, we will continue deploying capital and having turnover on that, and the objective is to generate more growth and returns. We've set ambitious target in terms of returns on that segment, and we will make sure that we do achieve that. Second part of the year, and I think probably the most critical one in terms of change, has been the development of an asset management strategy and starting to build an asset management platform in private assets. We've said that as a key priority when we met in March. And I think we've been pretty active in looking to different opportunities and end up in the acquisition of IK Partners, which is a highly respected team. And we view that as really one of the best partners. team in Europe for the mid-cap private equity business and probably one of the most active also GP in that sector. As you know, IT is managing 12 billion of assets today. The transaction is not yet closed, and it's not because of any issue. I mean, all different issues have been solved. There's still a few administrative things to finish, and we should be closing it probably early Q2 of this year. And our judgment on the acquisition of IKEA, we're even more happy today than we were when we made the acquisition. I mean, it's a great team. The quality of the cultural fit with Vandel team has been great. And their ability to generate value for their customers, the LPs, I think is still important. significant DPI significant divestiture during the year they made recently a new investment as you've seen so this is really really very happy and and we're working on now and making additional additions to that first helping IK to grow which would be the number one priority but also additional to that Having new GPs that could complement our strategy, our objective, as we've said during the investor day, is to have fee-related earnings in 2027 that would be around 150 million euros. And we're, I think, well determined to achieve that goal by then. Now, all of that is as one objective, return to shareholders. We want to increase return to shareholders. And our objective as a holding company is really to make sure that we can return significant value to shareholders. One of the key elements of the return to shareholders of holding companies, obviously, is dividend policy. We've set out a new dividend policy which was referenced to the NAV in March, and we revised upwards the percentage of NAV that we want to distribute to our shareholders given the way we plan our ability to generate value through principal investment and the general flows of fees that we will generate from asset management. And so this policy is basically to say we're going to distribute at minimum 2.5% of the NAV, and we will grow that percentage progressively with the growth of the asset management to potentially 3.5% or higher, depending on the size of the asset management going forward. But if we go to 2027, probably 3.5% would be the right target to achieve there when we will have 150 million of fee-related earnings. So that 2.5% result in a 4 euro per share dividend this year, which is a 25% increase compared to last year, mostly driven not by the growth of NAV, hopefully not. In the future, that will be growth of NAV that will drive dividend growth together with the increase in percentage. But here, it's mostly the change of policy and the increase in percentage that is driving the growth of the dividend. But I think it's important really to set out a clear policy that you can have clear visibility of what type of return we can make to our shareholders. In terms of capital management, we've, as you know, also announced that we were making a share buyback program. This is ongoing. We've done part of the 100 million that we've announced. And as I mentioned during the capital market day, share buyback is always a tool that we will use whenever we think it's appropriate. If we go into the financial highlight, I think first of all, and I've made it very quick comment on that, the sales of our companies has been very dynamic, 5.7% overall, which in fact has an underlying 6.4% organic growth, which I think, again, reflect well the quality of the different companies. We will go into the detail of each of them later, so I don't spoil this part. It has been also, we've seen strong margin across the board, which means that this translates into a significant increase of the contribution of this subsidiary, which is at 4.7% compared to last year. Our situation is to have a very strong financial flexibility. We have a huge amount of liquidity with 2.2 billion loan to value with pro forma of everything, which is pro forma of the sale of Constantia, pro forma of the purchase of IK performer of the potential investment we're going to make in in IK 10 that is under which is raised today by the IK team is below 10% and across our portfolio our companies still have low level of leverage so we have very significant financial flexibility which is important in this period because that give us opportunity, both to think about how investing well assets in principal investment, but also to deliver on our strategy to develop an asset management platform. NAV has been decreasing compared to last year. If we exclude the given distribution, it's 2.7 decline at 100, and it's set at 160.2 euro per share. Most of Well, all of the decline is linked to the decline in value of listed assets during the year. Berroir Veritas, for example, which is the one that weighed the most on our net asset value, had decreased by 7% over the year 2023. IHS 25 and Target 19. Apart from IHS, the performance of those companies since the beginning of the year has been totally the reverse, and you've seen that the performance, and we'll come to that, of Bureau Veritas has been highly regarded by the stock market. And we see a 17% increase in the share price of Bureau Veritas since the beginning of the year, which I think is is a good reflection of the quality of the business, and hopefully there will be more ahead after the Capital Market Day of Bureau Veritas, which is on March 20. That's a little bit what we can say about, you know, that the earnings by themselves and the net result, I mean, Benoit will go through the numbers. I'm not saying that the numbers doesn't reflect much, but I don't think it is the most important element of this earning. The most important is the change in NAV, the performance of the underlying companies, And our net result is significantly lower than last year. But last year, we had the sale of Chromology that was included in our earnings, which generated 590 million of capital gains. And capital gains, by definition, are not recurring. And, by the way, the fact that Constantia was sold on the 4th of January rather than on the 28th of December moved the capital gain on Constantia from one year to the other. So we will have the benefit of the capital gain of Constantia next year. Just an illustration that the net result by itself is highly volatile for holding companies. It's not representing the real value creation potential. Here I am. So as you see, the trend on dividend policy for euro per share is probably the most visible change of our strategy this year. And that will keep on going in the future. By the way, 26 million of share buyback. We're trying to do that in an organized manner so that it's well done. Our target is to buy at least 100 million euros. Here I am for this part. Maybe we will move now to the performance of the group companies and probably a very more important part. I start with Bureau Veritas and then I hand over to... To David, for the other companies, Bureau Veritas, as you may have seen the earnings, which were published a week ago, it's a significant growth of revenues, 3.8% published. But if you look to the organic revenue growth, it is 8.5%. And I think it's... Very important element, it shows that the tick business that has had some slow growth period since two years now has recovered significantly and we think that we're very optimistic with Hinda Garbi who's taken over the CEO position during the year 2023 on the perspective of growth of this business. This business has grown in most of its underlying business line. You see that the marine and offshore has had very, very big growth industry to certification. The one that has a little bit more suffered as being the consumer product, CPS, but they have well recovered in the fourth quarter, which I think is a good sign of where the market is heading. The margin of Bureau Veritas was established is the adjusted operating profit is up 3% and if you take it with a constant exchange rate it's an higher growth. The margin of AOP is 15.9%, and if you took that on constant margin, it would be 16.2%. So it means that compared to last year, it's a slight improvement of the margin, which I think is, again, a very encouraging sign altogether for the year to come. The debt situation of Bureau Veritas is no different from the other portfolio company. It is for the time being a low leverage, 0.9 times EBITDA as of December 31st, 2023, a slight decrease compared to last year, which gives a significant headroom in order to have an ambitious M&A program in the future. The dividend from Bureau Veritas stands at 0.83 euro per share, up 7.8% compared to last year, in line with the 65% payout ratio that was set last year. I don't go more in the outlook because I think Inda and her team made it very clear, but I think confidence in the future, meet to high single digital revenue growth, which is expected, another improvement in the adjusted operating costs. Margin is expected to end, which is very important, a very strong cash flow conversion, which is above 90%, and I think is one of the key ability to keep on investing in the future. So we're very optimistic on the future and the capacity of Bureau Veritas to deliver strong value going forward.

I'll give you the... Thank you. Good morning, everyone. Regarding Stahl, 2023 was... A solid year in a very tough environment. As you remember, high inflation, some supply chain disruption, and some muted demands in some end markets. Despite all those external forces, the year was solid. Organic growth was minus 8%, but partially offset by external growth. You do remember that in January, Steyr announced the acquisition of ISG for $205 million. and this acquisition was well integrated during the year. They're moving on a common ERP, and the synergies that we did anticipate are showing up. We are also seeing over the year in 2023 an improvement. H2 was better than H1, and definitely Q4 was better than Q3, which was better than Q2, which was better than Q1. So it gives us some hope for 2024. Regarding the margin, Stahl is showing some good price discipline, good fixed cost control as well. So you can see that the margin went up in 2023, despite the tough environment I mentioned. And again, ISG was perfectly integrated as well. In terms of leverage, despite the cash out of 205 million that I mentioned, and despite the 85 million of dividend that Vandel received, so 125 million paid by the company, Leverage is still under two times, 1.6 times, showing that Star continues to produce a massive amount of cash. It's a very cash-generative company with limited capex and limited working capital. And we were very pleased this year that Star received again a platinum rating from Ecovadis, which makes Star in the top 1% of the companies that Ecovadis is rating. So quite a performance. Scania is our, sorry, Scania, somehow I don't have the right order. So CPI, CPI had again a very good year. This is purely organic, as the company has not made an acquisition during the year, so above 15%. Across the board on almost every product and every geography, the performance has been very strong, especially in North America. The margin, as we mentioned, in 2022 was sort of uniquely high, above 50%. We said it at the time. The 49.6% is more where the company used to navigate. We had increased personal costs as the wages went up in the U.S. And we also had increased costs for venues and travel. On top of that, the company did invest quite substantially in terms of IT. We had a number of IT projects internally, trying to have better information, better data, and this had some impact on the margins as well. The leverage continued to go down, both because of the cash generation and the increase of the EBITDA, and today it stands at four times. So a very good year for CPI again. ACAMS has a strong EBITDA growth during 2023. The top line went up slightly below 5%. Remember that in 2022, one of ACAMS customers did pass a very strong order. And so it was a very high base in terms of computing the growth, excluding this very significant and unusual customer. The sales growth was more 8%. The booking up 10%, which gives probably a better view of the trajectory of the company. In terms of margin, you can see that the company has made some significant progress. This is the first year that the company is running as a standalone entity. The carve-out is now finished. There is no more TSA and links to the former parent company at TALEM. It is a fully standalone operating company as of now. In terms of leverage, we are slightly under six times today. The net debt was actually a bit up. We had a lot of one-off costs to implement this cutout. But thanks to the growth in terms of EBITDA, the leverage was maintained at below six times. A few comments on talent. We have recruited a new CEO. Neil started in early January. He's coming with a very significant experience and background from Thomson Reuters, where he did manage a very significant part of their business. And we expect this week a new CFO to join. We've been running with an interim CFO for quite some time now. And so the leadership is completely revamped at ACAMS. Scalion is the latest to join the family. As Laurent mentioned, we signed this investment pre-summer. We closed over the summer. It did continue to show a very strong trajectory and performance in terms of top line. You can see that Here, it did deliver a 15 plus percent organic growth, which is very, very strong. It is, to be fair, a market which is having some headwinds right now, and we can see some slowdown. Customers are trying to delay some of their projects. And so we need to adjust the cost base to this new environment. It takes a bit of time. You see the product being delayed and you have already hired people. So when there is a change in the pace of growth, usually it comes with the compression of margin. So even if we are showing here an improvement of margin during 2023, Recently, we saw compression of margin due to this slowdown. So very good performance, but as it is slightly slowing, it comes with some pressure as well. In terms of leverage, we are slightly under six banks. That does include the payment of a small acquisition, Dulin in Spain. It's a small group of consultants for cybersecurity for the banking industry. We are very pleased to sign. This is the first acquisition under our ownership, and the integration is going very well. In terms of talent, again, some changes at Scalion. There is a new CFO who joined. Nathalie is coming from Atos. She used to be the former CFO of Atos, and we hope that she will do some significant improvement at Scalion over the coming months. We are working hand-to-hand with the management to deliver a value creation plan. There is a clear roadmap to create value with the company, and it's really in the new DNA of the firm to run this plan. And we are very, very pleased the way that both teams at Canyon and Vanell are working together. Verdel Gross, as Laurent mentioned, we made over the last 12 months four acquisitions, four investments, minority investments. IntelliWeb, Brigade, Preligence, and Echemia, all B2B software companies, exactly in the sweet spot that we are looking for, high growth, between 10 and 30 million of run rate, and a path to profitability for each of them. It's very early innings for those investments, but very promising. As you can see, we have already 180 million invested in funds, which combined with those four investments make a commitment of 235 million in Vendelgross. And now, Benoit, for the financial results. Thank you.

Bonjour à tous. Good morning, everybody. The consolidated sales for 2023 reached 7.1 billion euros. It is 5.7% above last year and 6.4% organically. And the contribution of the portfolio companies to the net income group share is €362.1 million, increasing by 5.9%. Both reflect the very good results that Laurent and David have just presented. After deducting the financing, operating expenses and tax of Vendel, that has decreased under the effect of lower net interest expenses. deducting some restructuring costs and M&A costs in the portfolio companies and the entry from the goodwill allocation. The net income group share is 142.4 million euros. Last year, We had the disposal of Chromology with a capital gain that was 590 million euros. So we had a net income group share that was 656 million euros. The capital gain on Constancia Flexible will be booked in 2024 because the closing was early January. Concerning the NAV, so we have slightly adjusted our methodology to make it in line with the IPAVE guidelines that are the standards, the valuation standards for the private equity industry. We still use the share price for listed companies. We still use multiples of the listed peers for unlisted companies, but we have changed the way we consider the acquisition of a listed company when there is a significant difference between the acquisition multiples and the listed multiples. The impact is 1.4% positive from this adjustment on the NEV at the end of 2023. that is 160.2 euro per share or 7.1 billion. This displays a disappointing discount to our share price. If we look to the change over the year 2023, And if we adjust the dividend that has been paid in June, the NAV has decreased by 2.7% despite the good growth of the unlisted assets. At the end of 2023, the share price of Puro Veritas was €22.2 per share. Today, it's roughly €27 per share. That makes a big difference. For our development, we need a strong financial structure. So you can see here a description of the financial structure of Vendel. We have a low average coupon of our bond debt, that is 2.4%. We have a quite long average maturity that is 4.6 years with maturities between 2026 and 2034. We have ample liquidities. The 2.2 here is made of 1.3 of cash at the end of 2023, so it was before the 1.1. of net proceeds from Constantia and we also have a non-drone credit line that amounts to 875 million euros and that matures in 2027. But the main financial indicator for our financial structure is the loan-to-value ratio. It is 9.6% at the end of 2023 pro forma the disposal of Constantia and the acquisition of IK. It is well below the credit agency ceiling for our current credit rating that is BBB. So we have a very good financial structure to support our development. Moving to ESG, so we are very committed to improve the ESG profile of the group. You can see on this page that everything is improving. We have very good rating, and Christine and Glad will be very happy to answer your question concerning ESG.