Adhoc: Avolta AG: Avolta delivers another set of strong results across all KPIs in 9M and will cancel 4% of its share capital

Avolta AG / Key word(s): 9 Month figures
Avolta delivers another set of strong results across all KPIs in 9M and will cancel 4% of its share capital

31-Oct-2024 / 06:30 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 LR
The issuer is solely responsible for the content of this announcement.

---

AD HOC ANNOUNCEMENT PURSUANT TO ART. 53 LR

Avolta marks its 7^th consecutive quarter of strong growth in Q3, as it continues to successfully execute its Destination 2027 strategy. The company confirms its medium-term targets and will cancel approximately 6.1 million treasury shares (4% of issued share capital) in 2024 in line with its reinforced shareholder focused capital allocation policy.

HIGHLIGHTS:

• 9M reported turnover CHF 10,371 million, CORE turnover 10,172 million, organic growth +6.6%, like-for-like +6.8%, CORE EBITDA CHF 1,012 million, EBITDA margin 9.9%, EFCF CHF 445 million (+46% YoY)
  
• Q3 reported turnover CHF 3,908 million, CORE turnover CHF 3,830 million, organic growth +5.7%, like-for-like +5.9%, CORE EBITDA CHF 443 million, EBITDA margin 11.6%, EFCF CHF 232 million (+65% YoY)
  
• Avolta remains confident in delivering its outlook and confirms its Destination 2027 targets: growing the business organically and through bolt-on acquisitions, expanding profitability and cash generation with a target leverage of 1.5x to 2.0x
  
• The focus on shareholder value is reflected in Avolta's reinforced capital allocation policy, according to which we will return excess cash to shareholders via dividends and potential share buybacks over the coming years
  
• Consistent with this, Avolta announces that it will cancel approximately 6.1 million treasury shares (4% of issued share capital) in 2024
  
• Bank facility of EUR 2,400 million refinanced, extending the maturity profile and reducing financing costs

Xavier Rossinyol, CEO of Avolta, stated: "We are very pleased with our strong trading performance over the peak summer months which underscores our confidence in Avolta's outlook for 2024 and the years beyond in line with our Destination 2027 strategy.

Consistent with our strategy of traveler centricity, we have recently announced Club Avolta, a unique loyalty program available in all our locations worldwide.

Capitalizing on our global platform, we have a clear focus to grow the business organically expanding our profitability and cash generation, while targeting leverage of 1.5x to 2.0x. This focus on shareholder value is reflected in our reinforced capital allocation policy, according to which we will return excess cash to shareholders via dividends and potential share buybacks over the coming years. This starts with the cancellation of 4% of outstanding shares in 2024."

9M24 KEY FINANCIAL HIGHLIGHTS

9M consolidated turnover reached CHF 10,371 million with CORE turnover of CHF 10,172 million, up +6.6% on an organic basis. For Q3, CORE turnover grew +5.7% organic and +4.4% reported.

CORE Turnover Growth		9M 2024 vs 9M 2023		Q3 2024 vs Q3 2023
Like for Like		6.8%		5.9%
New concessions, net		-0.3%		-0.2%
Organic Growth		6.6%		5.7%
Change in Scope		3.5%		0.0%
Growth (CER)		10.0%		5.7%
FX Impact		-1.6%		-1.3%
Growth (AER)		8.4%		4.4%

Avolta's 9M CORE EBITDA came in at CHF 1,012 million with an EBITDA margin of 9.9%, +40bps YoY. For Q3, the EBITDA margin was 11.6%, up +60bps YoY driven by commercial performance and productivity increases.

9M EFCF amounted to CHF 445 million, with Q3 EFCF totalling CHF 232 million, +65% YoY and comfortably ahead of expectations.

The combined group's financial net debt stood at CHF 2,617 million as at end-September 2024, implying a leverage (net debt/CORE EBITDA) of 2.16x.

In October, Avolta refinanced its revolving credit facility (RCF), extending it by two years (through to 2029). Avolta anticipates interest expense savings of approximately CHF 10 million per annum.

9M24 KEY OPERATIONAL HIGHLIGHTS

Avolta's key strategic growth projects are advancing as planned. Strengthening its local partnership with Mass Transit Railway (MTR) in Hong Kong, the company has entered into an agreement to acquire 100% of Free Duty at an accretive multiple, extending its presence to six locations, reaching an additional 150 million travelers, and significantly expanding its footprint in Hong Kong. This regional acquisition, which is subject to customary conditions precedent to closing, accelerates the execution of Avolta's Destination 2027 strategy in the APAC region, driving continuous revenue growth with attractive margins.

Avolta launched Club Avolta in October, a pioneering loyalty program that brings together duty-free, duty-paid, convenience, F&B, brands, airports, airlines, hotels, and more across Avolta's 5,100 outlets worldwide.

REGIONAL PERFORMANCE Q3 2024

CORE Turnover (CHFm)		Q3 2024		Q3 2023		Growth vs 2023		FX Impact vs 2023		Organic Growth vs 2023
Europe, Middle East and Africa		2,156		2,002		7.7%		-0.7%		8.5%
North America		1,109		1,081		2.6%		-2.1%		4.7%
Latin America		392		422		-7.1%		-2.0%		-5.0%
Asia Pacific		143		135		5.9%		-2.3%		8.3%
Avolta Group		3,830		3,668		4.4%		-1.3%		5.7%
CORE Turnover (CHFm)		9M 2024		9M 2023		Growth vs 2023		FX Impact vs 2023		Organic Growth vs 2023
Europe, Middle East and Africa		5,268		4,747		11.0%		-1.1%		9.2%
North America		3,242		2,946		10.0%		-1.9%		6.1%
Latin America		1,159		1,198		-3.3%		-2.2%		-1.0%
Asia Pacific		425		420		1.3%		-3.3%		1.1%
Avolta Group		10,172		9,383		8.4%		-1.6%		6.6%

IFRS/CORE TURNOVER RECONCILIATION

Q3 2024 (CHFm)		Turnover IFRS		Fuel Sales Adjustments		Turnover CORE
Europe, Middle East and Africa		2,234		78		2,156
North America		1,109				1,109
Latin America		392				392
Asia Pacific		143				143
Avolta Group		3,908				3,830
9M 2024 (CHFm)		Turnover IFRS		Fuel Sales Adjustments		Turnover CORE
Europe, Middle East and Africa		5,466		198		5,268
North America		3,242				3,242
Latin America		1,159				1,159
Asia Pacific		425				425
Avolta Group		10,371				10,172

MEDIUM-TERM OUTLOOK

Avolta confirms its CORE turnover growth target of 5%-7% p.a. on average at constant exchange rates in line with its Destination 2027 strategy. Avolta is committed to deliver +20-40bps of CORE EBITDA margin improvement p.a. as it continues to increase its operational efficiency, and +100-150bps EFCF conversion, with a c. 4% CAPEX on CORE turnover p.a.

REINFORCED CAPITAL ALLOCATION POLICY

Capitalizing on its integrated and transformed platform and in line with its Destination 2027 strategy, Avolta has a clear focus to deliver organic growth, EBITDA margin expansion and higher EFCF conversion, and clear commitment to drive shareholder value.

Avolta continues to prioritize organic investment to drive growth. The company will continue to selectively consider value-accretive cash funded M&A opportunities, maintaining a high threshold for strategic and financial returns.

To maintain an efficient capital structure, Avolta's target is to operate with leverage of approximately 1.5x - 2.0x over the medium term, with flexibility to move up to 2.5x for business opportunities. Avolta's consistent strong operating cash generation and the progress being made with deleveraging means that there will be opportunities to return excess capital to shareholders by way of dividends and potential share buybacks.

Furthermore, supported by the company's strong balance sheet and financial performance, and in line with the Destination 2027 outlook, Avolta will cancel approximately 6.1 million treasury shares (4% of issued share capital) in 2024.

¹Without Argentinean effect, 9M Like-for-Like Growth vs 2023 would be 8.0%

For further information:

CONTACT

Rebecca McClellan	Cathy Jongens
Global Head Investor Relations	Director Corporate Communications
Phone: [phone]	Phone: [phone]
[e-mail]	[e-mail]

---

End of Inside Information

---

Language:	English
Company:	Avolta AG
	Brunngässlein 12
	4010 Basel
	Switzerland
Phone:	[phone]
E-mail:	[e-mail]
Internet:	https://www.avoltaworld.com/
ISIN:	CH0023405456
Listed:	SIX Swiss Exchange
EQS News ID:	2019539

End of Announcement	EQS News Service

---

2019539 31-Oct-2024 CET/CEST