The French inspection and certification group Veritas recorded a net loss of 34.1 million euros in the first half, against a net profit of 171 million last year, penalized by a drop in turnover of 11 % due to the effects of the health crisis. First-half sales stood at 2.2 billion euros, down 8% organically (at constant scope and exchange rates), according to a group press release on Tuesday. But the decline was much more pronounced in the second quarter with sales (1.1 billion euros) down almost 16% organically (18.6% as reported), against a decline of -1.6% on first three months (-3% as published).
Director General Didier Michaud-Daniel, quoted in the press release, insisted on the “diversification strategy that allows for increased resilience“, Estimating that the turnover had”globally resisted the shock of the pandemic»Over the semester. According to the boss of Bureau Veritas, around 80% of the business portfolio posted “a good level of resistance“While 20% was”severely affected by containment measures“. Among the business segments that resisted, the Marine and Offshore division even recorded organic growth of more than 3%. The Agri-Food and Raw Materials, Building and Infrastructure, Industry sectors experienced an average organic decline limited to 6.6%.
Conversely, the Consumer Goods and Certification segments were severely affected by the closures due to Covid-19 with average sales drops of more than 21% (still at constant scope and exchange rates).
The decline in activity weighed on operating income, which fell to 59.6 million euros (against 331.7 million a year earlier). Over the first six months, the adjusted operating margin (excluding exceptional items), a performance indicator monitored by the group, fell to 9.8% (compared to 15.4% for the same period of 2019).
Faced with the crisis, in addition to cost reductions and cash flow protection, the group has launched a series of solutions to support companies in their resumption of activity, in particular to verify the compliance and relevance of their health procedures, safety and hygiene. This program, called “Restart your business with BV»Collected«a strong dynamic», Assured the group.
But in his outlook, Mr. Michaud-Daniel insisted on “the current uncertainty” and the “lack of visibility“. In this context, the group examined three scenarios for the rest of the year, ranging from a “slow and gradual recovery” to one “worsening pandemic“, Passing by a”sluggish recovery“. In all three cases, Bureau Veritas expects an adjusted operating margin “low double digit»In 2020 and a drop in turnover, which could go up to double digits in the worsening scenario in the second half of the year.
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