HOOFDDORP, The Netherlands, March 7, 2012 /PRNewswire-Asia/ -- CEVA Logistics, one of the world's leading non-asset based supply chain management companies, has reported record revenues and strong EBITDA growth for the year ended 31 December 2011. This robust performance was underpinned by the company's continuing drive to increase operational efficiency, add incremental business with key customers in target sectors and reduce costs.
In early 2012, the group completed a transformational equity and debt funded financing, which eliminated over euro850 million of debt, strengthened the balance sheet, and positioned CEVA well for future growth.
Highlights of the year
Commenting on the results, John Pattullo, CEO said: "2011 was a year of strong progress for CEVA. We improved our financial performance substantially in the first half year and have maintained top line performance in a more challenging economic environment in the second half. This was helped by the structural improvements we made through the year, our continued focus on cost and ongoing improvements in our operations. Our recent transformational financing has strengthened our balance sheet and positions us well for profitable growth in the future."
Year ended 31 December 2011
| Key Financials (euro millions) | Actual Exchange Rates | Constant Exchange Rates | |||
| 2010 | 2011 | Change | 2011 | Change | |
| Revenue | 6,847 | 6,895 | 0.7% | 7,047 | 2.9% |
| EBITDA before specific items (Note 1) | 292 | 321 | 9.9% | 330 | 13.0% |
| Note 1: EBITDA excludes the impact of specific items which are significant non-recurring items such as restructuring and certain legal expenses. | |||||
In the Full Year CEVA increased revenue by 1% to euro6,895 million. At constant exchange rates, revenue increased by 3%, driven by an 8% increase in Contract Logistics business and a 2% decrease in Freight Management business. The slower Freight Management revenue performance was partly due to a decline in transportation rates (resulting in lower revenue charged to customers), along with softer airfreight volumes.
EBITDA before specific items increased by 10% to euro321 million in 2011. CEVA estimate the flooding in Thailand had a net impact of approximately euro7 million. At constant exchange rates, there was 13% EBITDA growth (15% excluding the flood), driven by Contract Logistics volumes and strong margin improvement in Freight Management, partly due to the structural improvement programs. As a result, CEVA increased the EBITDA margin to 4.7% (2010: 4.3%). CEVA's management of working capital continues to be effective, with Net Working Capital at year end improving to euro(76) million (2010: euro(26) million).
As one of the market leading players in Thailand CEVA worked closely with customers to ensure their factories maintained the ability to produce at full capacity for as long as possible. CEVA integrated customers' IT servers into the network, and re-routed shipments or shipped straight from factory/warehouse. Through these prompt actions, CEVA helped maintain business for customers over this critical period. CEVA is now seeing a return to normality in Thai business.
Oceanfreight was one of the highlights of 2011. CEVA's continued strategic focus on this area delivered a 17% increase in total Ocean volumes. During the year, CEVA strengthened the Ocean team with several significant new hires, launched the Less-Than-Containerload service and expanded many of the existing Ocean services.
In 2011, CEVA increased the new business pipeline by over 17% and, in Freight Management particularly, CEVA has achieved an increasingly strong conversion rate of targets into new business wins. The retention rate for 2011 was over 90%. As a result, CEVA has achieved a more balanced sector portfolio. Wins were also spread across the globe, and CEVA now has over 40% of the business in high growth areas, such as Asia Pacific, Latin America, the Middle East and Africa.
On 1 February 2012, CEVA Group plc ("CEVA"), together with its parent CEVA Investments Limited ("CIL"), successfully completed a debt and equity funded financing. Through this transaction CEVA eliminated over euro500 million of CEVA indebtedness as well as euro355 million of CIL securities, materially reduced annual interest expense, significantly extended the debt maturity profile and improved credit ratings. This transaction has strengthened the balance sheet substantially, and positioned us well for future growth.
As CEVA heads into 2012, CEVA's team expects the economic uncertainty of the last few months to continue. CEVA believes that CEVA has identified and prioritized the right actions to continue to strengthen the business model, even with this external background, and build the market position so that CEVA outperforms the peer group in 2012.
CEVA - Making business flow
CEVA Logistics, one of the world's leading, non-asset based supply chain companies, designs and implements industry leading solutions for large and medium-size national and multinational companies. Approximately 51,000 employees are dedicated to delivering effective and robust supply chain solutions across a variety of sectors and CEVA applies its operational expertise to provide best-in-class services across its integrated network, with a presence in over 170 countries. For the year ending 31 December 2011, the Group reported revenues of euro6.9 billion. For more information, please visit www.cevalogistics.com.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT of 1995:
The statements included in this news release, and other statements that are not historical facts, may contain forward-looking statements. In addition to the assumptions specifically mentioned in the above paragraphs, there are a number of other factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, the actual effects of recent and future regulatory changes and technological developments, globalization, levels of spending in major economies, the economic downturn in Asia, Europe and the US, including the economic downturn in the automotive sector, levels of marketing and promotional expenditure, actions of competitors and joint venture partners, employee costs, future exchange and interest rates, changes in tax rates, unexpected costs of future business combinations or dispositions and other factors detailed in risk factors and elsewhere in CEVA most recent Annual Reports. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, is contained in the Company's annual and quarterly reports, available on the Company's website. Should one or more of these risks or uncertainties materialize or the consequences of such a development worsen, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those forecasted or expected. CEVA disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.
For more information contact:
CEVA Group Marketing & Communications
Rebecca Salt
+44-7795-314010
Rebecca.Salt@cevalogistics.com
