In the first quarter of 2022, the holding company had a turnover of RON44.5 million and a net result of RON0.2 million. However, the company said this comparison is not relevant against the backdrop of more acquisitions carried out lately.
“As the acquisitions made by Roca Industry during 2022 took place starting with March (so none of these have performance included in the Q1 2022 consolidated financial results), and considering the favourable context of the building materials industry in the first quarter of 2022, the comparability of Q1 2022 and Q1 2023 consolidated results does not give a true picture of reality”, the report reads.
Roca Industry are o capitalizare bursieră de 155 mil. lei iar în 2023 acțiunile au scăzut cu 18%. Spre comparație indicele principal BET a urcat cu 4,15% iar BETAeRO cu 8,3%.
“Even though the consolidated turnover incresed by 84% in Q1/2023 vs Q1/2022, the higher operating expenses caused the EBITDA at consolidated level to be in total amount of RON 3.1 million (with a margin of 4% of turnover). The transactions carried out during 2022 that led to the consolidation of the holding also generated an increase in depreciation and amortization expenses following the recognition of the goodwill from the acquisitions, as well as financial expenses as a result of the increase in bank interest and the new credit facilities required by the companies in the group (including LBOs – leveraged buyout) negatively influenced the net result. Thus, the recorded consolidated net loss was RON5.5 million”, the report also shows.
Ioan-Adrian Bindea, general manager of Roca Industry, said: “We will continue the level of investment because what has brought us this far will not take us any further, where we are aiming, and our objective to have at least 8 companies in our portoflio remains valid. As I have mentioned on every occasion, we are in a long-term construct that brings value to shareholders over time. To maximize value, achieve our goals and support Romania’s reindustrialization by growing regional champions, we are already working towards the goal of being admitted to trading on the main market of the Bucharest Stock Exchange.”
Roca Industry is the holding company that manages the companies in the Group, without having operational or production activity of its own. At the end of March 2023, the Holding held stakes in six productive companies, Bico, Evolor (former Sarcom), Eco Euro Doors (EED) and Dial Harsova (Dial) directly, as well as in Terra and Europlas Lux – indirectly, through Bico, and controlled two investment vehicles (SPVs – Doorsrock4 and Nativerock1).
Four of the six companies were acquired during 2022, at different times (Terra in March, EED in May, Dial in September and Europlas in October), the direct or indirect holdings of Roca Industry in these companies being distinct (Evolor – ex Sarcom – 100%, Bico – 70%, Terra – 70% (in which Bico holds 100% of the share capital), EED – 100%, Dial – 100%, Europlas – 35% (in which Bico holds 50% of the share capital). For a more accurate picture of reality and as no new acquisitions were finalized between January and March 2023, the company’s management presents the group’s results in two forms: consolidated results and cumulated results.
In the first quarter of 2023, Roca Industry achieved a consolidated EBITDA of RON3.1 million, mainly generated from the activity carried out by Evolor, former Sarcom (EBITDA RON2.1 million), EED (EBITDA RON1.3 million), Terra (EBITDA RON0.8 million) and Dial (EBITDA RON0.4 million).
The holding company, Bico and the SPVs set up for the purpose of financing the acquisitions (Doorsrock4 and Nativerock1) generated a cumulative negative EBITDA of RON1.5 million, mainly representing the operating expenses of the holding company as well as other expenses from the current activity carried out by the companies.
“Consolidated EBITDA in Q1/2023 of RON3.1 million was 23% lower compared to Q1/2022, mainly due to the decrease in EBITDA achieved by Bico in the first three months of 2023 (RON -0.2 million in Q1/2023 vs. RON4.3 million in Q1/2022), as a result of the application of a policy of diminishing the inventories, i.e. selling finished products obtained at a high cost during 2022. This policy comes in the context that, after a short period of economic imbalances felt in the market during which raw materials recorded high prices, they had a downward trend that continues as of the date of this report. Thus, companies that produced during that atypical period were not able to incorporate the full cost of production into the price of the products sold. Also, the result obtained from the operating activity is influenced by the seasonality of the market in which the company operates, so according to industry statistics, the first and fourth quarters generate lower sales”, in line with the report.