CFO'S statement

  • Introduction
  • Revenue
  • Other
  • Outlook


We remain on track to achieve our strategic objective of above market growth, with core revenue increasing by 5.2% at constant currency in 2019. We are maintaining best-in-class profitability while continuing to invest in innovation and to expand into new markets and categories. Our strong cash flow generation is enabling us to invest in the business while paying an attractive dividend and reducing net leverage. The high returns on our investments are illustrated by a post-tax return on capital employed of 22.8% in 2019.

“Our strong cash flow generation is enabling us to invest in the business while offering an attractive dividend to our shareholders.”

Samuel Sigrist

Chief Financial Officer

Key performance highlights

  • 1.77 bn

    Core revenue

    2018: €1.64bn

  • + 5.2 %

    Core revenue growth1

    2018: +6.4%

  • 7.5 %

    Reported core revenue growth

    2018: 3.4%

  • 485 m

    Adjusted EBITBA

    2018: €462m

  • 27.2 %

    Adjusted EBITDA margin

    2018: 27.5%

  • 22.8 %


    2018: 20.6%

  • 217 m

    Adjusted net income

    Reported: €107m

  • 0.68

    Adjusted EPS2

    EPS2 €0.33

  • 267 m

    Free cash flow

    Per share2 €0.83

1At constant currency.


Alternative performance measures

For definitions of alternative performance measures and their related reconciliations that are not included in this statement, please refer to the following link

Financial performance

Revenue evolution

Over the past ten years, we have diversified our geographic exposure. The share of third-party core revenue outside EMEA has increased from 28% in 2009 to 57% in 2019. Demographic trends, with urbanisation and rising disposable incomes, continue to drive demand for packaged food and beverages in Asia Pacific and Americas. Our geographic diversification in these segments has been underpinned by the expansion of our local production facilities.

Increased geographic core revenue diversity

  • Outside EMEA
  • EMEA

Revenue growth outside EMEA

Increased geographic core revenue diversity (€ millions)

Revenue by segment

In 2019, core revenue increased by 7.5% (5.2% on a constant currency basis) to reach €1,766.9 million (total revenue €1,783.9 million). Visy Cartons, consolidated from 29 November, contributed 20 basis points to the growth rate.

The difference between core revenue and total revenue is diminishing, with the phasing out of folding box board sales from our Whakatane Paper Mill largely complete. Whakatane is now primarily an internal supplier of liquid paper board.

All segments contributed to core revenue growth. EMEA constant currency growth of 2.8% reflects continued growth in the European business as filling machines placed with new customers start to ramp up. Markets in the Middle East and Africa improved with a pick-up in economic activity in several markets.

We saw revenue growth in APAC of 6.0% on a constant currency basis, driven primarily by China, Thailand and Indonesia. In China, we were able to participate in and contribute to expansion by one of our key customers. In Thailand, we saw successful new product launches by our customers and an expansion of their export market opportunities.

Strong growth in Mexico, with recent filler installations ramping up, and the deployment of new filling machines in Brazil contributed to constant currency growth of 9.7% in Americas.

SIG revenue split1

Fillers 6 %

Sleeves 87 %

Service 7 %

Fillers 6 %

Sleeves 87 %

Service 7 %

1Revenue split based on revenue generated through sale of system components and sleeves & closures for 2019.


Revenue growth was the main driver of the increase in adjusted EBITDA from €461.5 million in 2018 to €485.4 million in 2019. The negative foreign currency impacts experienced in 2018 were partially reversed, with a positive contribution from currencies of €15.5 million in 2019.

Raw material costs had a €4 million positive impact on adjusted EBITDA in 2019. We were able to negotiate lower prices with selected suppliers and to benefit from unhedged polymer volumes as commodity prices weakened. This more than offset year-over-year price increases in the hedged portion of our aluminium and polymer contracts.

The continued execution of operational excellence programmes in our production facilities led to significant production efficiency gains. These were partially offset by additional freight costs in Americas in the first half of 2019, resulting in a net benefit of €7 million.

SG&A increased by €21 million, primarily driven by the costs of being a public company, higher employee variable income provisions reflecting a stronger operating performance, and headcount increases in growth markets. R&D investments as a proportion of revenue were steady at approximately 3%.

Cash flow generation at our joint ventures in the Middle East accelerated during the year. In the fourth quarter we completed a refinancing which allowed us to benefit from this strong cash flow performance. As a result, the dividend distribution in the fourth quarter of 2019 was higher than expected. However, for the full year the dividend was €3 million lower than in 2018. This reduction is reflected in the adjusted EBITDA margin for EMEA, which was also affected by unfavourable mix effects in the first half of the year and by higher SG&A costs.

The adjusted EBITDA margin in APAC increased significantly to 33.5% in 2019, reflecting operating leverage and a positive currency effect. The adjusted EBITDA margin in Americas was lower at 25.5%, with a negative impact from the depreciation of the Brazilian Real. In addition, the USA was affected by high freight costs in the first half of the year due to a strike in Europe and by costs relating to the ramp up of combismile.

Adjusted EBITDA margin1

2019 2018
EMEA 32.1% 33.5%
APAC 33.5% 30.3%
Americas 25.5% 27.2%
SIG Group 27.2% 27.5%

1Adjusted EBITDA divided by revenue from transcations with external customers.


Net debt

The Group is financed by term loans at a cost of approximately 2.2% as of 31 December 2019. A net leverage improvement of 0.4 turns year on year was driven by adjusted EBITDA performance and by higher cash balances at the end of the year. The impact on net leverage of implementing the new IFRS lease accounting standard in 2019 was not material (€15.9 million).

  • 2.8 x


  • ~ 2.2 %

    Cost of debt

Net debt

(In € million) 2019 2018
Gross total debt 1,614.4 1,618.7
Cash and cash equivalents 261.0 157.1
Net total debt 1,353.4 1,461.6
Total net leverage ratio 2.8x 3.2x


To allow our shareholders to participate in the cash generative nature of our business, we have set a dividend payout target of 50 to 60% of adjusted net income. The dividend proposed for 2019 means that we will already move into this range.

  • + 52.9 %


  • CHF 0.38


At the Annual General Meeting to be held on 7 April 2020, the Board of Directors will propose a dividend payment for 2019 of CHF 0.38 per share, totalling CHF 121.6 million (equivalent to €112.1 million as per the exchange rate on 31 December 2019), payable out of the capital contribution reserve.

1Dividends reinvested.


For 2020, the Company expects core revenue growth at constant currency towards the lower end of a 6 to 8% range, including the full year consolidation of Visy Cartons. The adjusted EBITDA margin is expected to be towards the lower end of a 27 to 28% range, taking into account continued investments in geographic expansion and innovation and a lower level of profitability at Visy Cartons prior to the realisation of synergies.

As construction of the new plant in China proceeds, net capital expenditure is forecast to be at the upper end of the targeted 8 to 10% of revenue range. Free cash flow may therefore be somewhat lower than in 2019.

The Company maintains its medium-term guidance of core revenue growth of 4 to 6% at constant currency and an adjusted EBITDA margin of around 29%. Net capital expenditure should remain within 8 to 10% of revenue. The Company plans to maintain a dividend payout ratio of 50 to 60% of adjusted net income while reducing net leverage towards 2x.