April 28, 2020 / 6:09 PM / a month ago

BRIEF-Tarkett Q1 Adjusted EBITDA Of 42.4 Million Euros

April 28 (Reuters) - TARKETT SA:

* RESILIENT ADJUSTED EBITDA IN Q1 2020 IN SPITE OF SLIGHTLY LOWER REVENUES - STRONG FOCUS ON COSTS REDUCTION AND CASH PRESERVATION IN THE WAKE OF THE COVID-19 CRISIS

* Q1 NET REVENUES DOWN -2.2% WITH A LIKE-FOR-LIKE CHANGE OF -2.9% VERSUS Q1 2019

* Q1 2020 ACTIVITY IMPACTED BY LOCKDOWN MEASURES AT END OF QUARTER, PARTICULARLY IN EUROPE; DEMAND IMPACTED IN ALL KEY REGIONS SINCE EARLY APRIL

* Q1 ADJUSTED EBITDA OF EUR 42.4 MILLION OR A 6.9% MARGIN, STABLE VERSUS LAST YEAR

* SUBSTANTIAL ADDITIONAL SET OF COST CUTTING MEASURES TO ADAPT TO REDUCED DEMAND IN Q2 2020 AND STRICT CASH MANAGEMENT TO PROTECT CASH-FLOWS

* SOLID LEVEL OF LIQUIDITY WITH EUR 650 MILLION IN CASH AND CONFIRMED CREDIT LINES AT END OF MARCH; ONGOING DISCUSSION WITH BANKS TO SET UP ADDITIONAL CREDIT LINES AND WAIVE FINANCIAL COVENANT

* ACTIVITY IN APRIL HAS SIGNIFICANTLY SLOWED DOWN AND SALES ARE EXPECTED TO BE DOWN AROUND -40% COMPARED TO APRIL 2019

* ADJUSTED EBITDA TO BE AFFECTED IN Q2 AND FY 2020 BY CURRENT SITUATION, LEVERAGE RATIO TARGET (NET DEBT TO ADJUSTED EBITDA BETWEEN 1.6X AND 2.6X AT END OF YEAR) SUSPENDED FOR 2020

* TEMPORARY LAY-OFFS AND REDUCTION IN WORKING TIME IN ALL LOCATIONS CONCERNED, INCLUDING FOR SUPPORT FUNCTIONS, IN ACCORDANCE WITH SCHEMES PROPOSED BY LOCAL GOVERNMENTS

* END-MARCH, GROUP CASH POSITION EUR 217 MILLION, AVAILABLE UNDRAWN CREDIT LINES ABOVE EUR 500 MILLION, OUT OF WHICH EUR 443 MILLION CONFIRMED

* GROSS DEBT BEFORE IFRS 16 AMOUNTED TO EUR 887 MILLION AT END OF MARCH (OUT OF WHICH EUR 2 MILLION TO REPAY BEFORE YEAR END)

* CHALLENGING CONTEXT DOES NOT PREVENT TARKETT FROM PURSUING STRATEGIC INITIATIVES TO DELIVER ON MID-TERM FINANCIAL OBJECTIVES BY 2022

* ACCURATE IMPACTS OF COVID-19 CRISIS CANNOT BE QUANTIFIED AT MOMENT FOR FIRST HALF NOR FOR FULL YEAR

* RAW MATERIAL PRICES WHICH STARTED DECREASING IN Q1 2020 ARE EXPECTED TO FURTHER DECLINE IN SECOND HALF

* COST SAVINGS ARE EXPECTED TO BE WELL ABOVE EUR 30 MILLION ANNUAL TARGET Source text for Eikon: Further company coverage: (Gdansk Newsroom)

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