The EXOR board of directors’ meeting, chaired by John Elkann, met today in Turin and approved the consolidated results for the nine months ended September 30, 2013.
At September 30, 2013 EXOR’s Net Asset Value (NAV) is €9,162 million and an increase of €1,542 million compared to December 31, 2012 (€7,620 million). The change in NAV compared with the MSCI World Index in Euro is presented below.
The EXOR Group closes the first nine months of 2013 with a profit of €1,743.4 million; the corresponding period of 2012 ended with a profit of €217.5 million. The increase of €1,525.9 million is principally due to higher net gains realized in the first nine months of 2013 of €1,510.5 million (of which €1,534 million relates to the sale of the entire investment in SGS) and lower net financial expenses of €19.9 million, offset in part by negative net other changes of €4.5 million.
Profit in the third quarter of 2013 is €71.6 million; the same period of 2012 ended with a profit of €49.2 million. The increase of €22.4 million primarily comes from lower net financial expenses of €11.4 million, the share of the higher profit of the investment holdings in the third quarter of 2013 of €6 million and positive net other changes of €5 million.
The consolidated equity attributable to the owners of the parent at September 30, 2013 amounts to €6,192.6 million, a net increase of €23.8 million compared to €6,168.8 million at year-end 2012.
At September 30, 2013 the consolidated net financial position of the Holdings System is a positive €1,290 million and a positive change of €1,815.9 million over the negative balance of €525.9 million at year-end 2012, mainly originating from the sale of the entire investment in SGS for proceeds of €2,003.7 million.
Investment in Almacantar
On July 5, 2013 EXOR S.A. made a payment of £19.2 million (€22.3 million) to Almacantar to settle the remaining amount due on the capital increase subscribed to in full in 2011 which had not yet been fully paid.
In order to ensure additional financial resources for new investments, on July 11, 2013 EXOR S.A. subscribed to a new capital increase for a total of £50 million (€57.9 million), with two payments made for a total of £23.8 million (€27.9 million). Following the capital increase, EXOR S.A. holds approximately 38.29% of Almacantar S.A. share capital.
Fiat Industrial and CNH Global merger
The deed for the merger of Fiat Industrial S.p.A. with and into CNH Industrial N.V. and the deed for the merger of CNH Global N.V. with and into CNH Industrial N.V. were executed on September 27 and 28, 2013, respectively, and the integration of these two companies was completed on September 29, 2013.
At closing, CNH Industrial issued 1,348,867,772 common shares allotted to Fiat Industrial and CNH Global shareholders on the basis of the established exchange ratios. On September 30, 2013 CNH Industrial N.V. common shares began trading on the New York Stock Exchange and the Mercato Telematico Azionario managed by Borsa Italiana S.p.A.
EXOR with its 366,927,900 Fiat Industrial ordinary shares received 366,927,900 CNH Industrial common shares and the same number of special voting shares. As of today’s date, EXOR directly thus holds, respectively, a 27.20% stake and 40.25% of the voting rights.
EXOR bond issue 2013-2020
On November 12, 2013 EXOR issued non-convertible bonds for €200 million with final maturity November 12, 2020 and an annual coupon of 3.375%, through a private placement to institutional investors.
EXOR repurchased a notional amount of €50 million of its outstanding 5.375% Notes (due 2017) and in aggregate, EXOR holds a notional amount of such Notes equal to ca. €57 million.
The following is a brief commentary on the performance of EXOR’s major unlisted investment: C&W Group. EXOR’s Interim Report at September 30, 2013 presents comments on the performance of all the principal subsidiaries and associates.
In the first nine months of 2013, C&W Group continued executing its long-term strategic plan of enhancing recurring revenue streams across geographies. The firm’s growth accelerated as the year-to-date period progressed as gross revenue in the third quarter increased 30% and Adjusted EBITDA increased 74%, as compared with the same period last year.
For the nine months ended September 30, 2013, gross revenue increased $272.6 million, or 19.6%, or 20.5% excluding the impact of foreign exchange, to $1,665.0 million, as compared with $1,392.4 million for the same period in the prior year. Net revenue increased $123.9 million, or 11.7%, or 12.8% excluding the impact of foreign exchange, to $1,180.2 million for the nine months ended September 30, 2013, as compared with $1,056.3 million for the prior year period. Net revenue increased by double digits across the Capital Markets, Valuation & Advisory (“V&A”) and Corporate Occupier & Investor Services (“CIS”) service lines. Capital Markets and CIS net revenue increased by double digits in all regions, including the Americas, EMEA and Asia Pacific.
Total operating expenses increased $59.1 million, or 9.5%, to $680.0 million for the first nine months of 2013, as compared with $620.9 million for the same period in the prior year, primarily due to increases in employment-related expenses, as well as other direct costs in line with Group’s revenue growth and strategic plan initiatives. Also included in operating expenses for the current year nine month period are certain acquisition and non-recurring reorganization-related charges of approximately $1.6 million, which are excluded from Adjusted EBITDA (Adjusted EBITDA removes the impact of acquisition-related charges of $2.5 million and non-recurring reorganization-related charges of $4.8 million).
At the operating level, C&W Group’s income rose $14.2 million to $20.5 million for the first nine months of 2013, as compared with $6.3 million in the prior year period. Adjusted EBITDA was $56.2 million for the current year-to-date period, representing an increase of 44.5% over EBITDA of $38.9 million for the prior year nine month period, which was not impacted by any acquisition or non-recurring reorganization-related charges. EBITDA as reported increased $10.0 million to $48.9 million in the first nine months of 2013, as compared with the first nine months of 2012.
Adjusted loss attributable to owners of the parent, which excludes the tax-affected impacts of certain acquisition and non-recurring reorganization-related charges, improved $17.2 million, or 100%, to break-even for the current nine month period, as compared with the loss attributable to owners of the parent of $17.2 million for the same period in the prior year which was not impacted by such charges. The loss attributable to owners of the parent as reported improved by $13.1 million, or 76.2%, to $4.1 million as compared with the prior year nine month period. The improvement in the loss attributable to owners of the parent as reported is due to the improvement in EBITDA, as well as a decrease in the income tax expense of $3.9 million to $8.7 million for the first nine months of 2013, as compared with an income tax expense of $12.6 million for the same period in the prior year.
C&W Group’s net financial position improved $2.4 million to a negative $85.0 million (principally debt in excess of cash) as of September 30, 2013, as compared with a negative $87.4 million as of December 31, 2012. The net financial position was a negative $123.3 million as of September 30, 2012.
EXOR S.p.A. expects to report a profit for the year 2013.
At the consolidated level, 2013 is expected to show a profit, taking into account also the capital gain realized on the sale of the investment in SGS.
The Interim Report at September 30, 2013 will be available from this date at the Company’s headquarters and on its website www.exor.com
The executive responsible for the preparation of EXOR S.p.A.’s financial reports, Enrico Vellano, declares, in accordance with article 154 bis, paragraph 2 of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the results documented in the books, accounting and other records.