D’Ieteren’s results delight the market

“Agility, flexibility and accelerated transformations” allowed D’Ieteren (and Berlon especially) to increase its profit in a year of declining sales. These numbers boosted the share price.

Since October, the share price D’Ieteren

never stops climbing. From a low of 43.05 euros, the action traded on Monday at nearly 80 euros, a record. Analysts’ opinions on the stock were positive. Reading the 2020 figures for the Ixelles-based company confirms great resilience in the face of the pandemic. “In 2020, profit is up 11.2% (332.7 million euros in profits before taxes) while the turnover fell by 10.1% “, emphasizes Francis Deprez, CEO of D’Ieteren. This is better than the consensus of analysts (301.9 million euros).

1.35

euro

D’Ieteren’s dividend will be 1.35 euros this year against 1 euro paid last year.

The beautiful dynamic will not stop there according to the management which predicts that in 2021, its pre-tax profits will increase by another 25%. Incidentally, the dividend of D’Ieteren will be 1.35 euros this year against 1 euro last year, more than expected by analysts (1.10 euros)

D’Ieteren took advantage of the crisis to accelerate the transformation of its business. Belron remains the cash cow of the group with a profit of 365.6 million euros before tax. When D’Ieteren decided to sell 40% of Belron to CD&R for 987.7 million euros in 2017 (finalized in early 2018), its subsidiary was making only 62.4 million euros in pre-tax profits.

“Not a strategic mistake”

These 40% ceded represented over the 2018-2020 period at least € 250 million in beneficiary shares before taxes which escaped the D’Ieteren group. Should this be seen as a big strategic error? Not in the least according to Francis Deprez who believes that it is precisely this sale which set the dynamics in place at Belron to “trigger this new stage”.

D’Ieteren now owns 53.75% of Belron. The subsidiary represents 248.2 million euros in pre-tax profits on the 332.7 million D’Ieteren.

Belron’s “Fit for growth” plan was accelerated with the crisis. “What we wanted to do in 3 or 4 years, we did in a year”, rejoices the CEO. Despite lockdowns and work volumes down 13%, Belron recorded growth thanks to the recalibration of windshields for driver assistance systems. Belron totaled 1.1 million recalibrations in 2020, or 17% of treated windshields compared to 11% in 2019. Belron’s operating margin jumped from 9.8% in 2019 to 15% in 2020.

No more developing Belron’s know-how in other services such as home work or bodywork. Belron will focus on what she does best, glazing, calibration and the sale of additional products such as windshield wipers.

In the automobile (-11.5% of sales and -20% for profits before taxes), the importer of VW group brands in Belgium limits the breakage of a dramatic year for the sector (-21.5%) by increasing its market share from 22.7% to 23.6%. 2020 was a year of restructuring at D’Ieteren Auto, which separated 211 people (40 million euros in expenses). The lack of a salon shouldn’t feel too much in 2021, according to Deprez who “says he is very, very happy with the digital show”.


“With the crisis, prey has not become cheaper.”

Francis Deprez

CEO of D’Ieteren

Moleskine (-37.6% of sales) is the activity most affected by the pandemic with Moleskine stores and customers closed across the world in 2020 and corporate gifts at half mast. “We will focus on Moleskine’s star products. We expect sales to increase by 20% this year,” points out CFO Arnaud Laviolette. A new online sales site will be launched in the summer.

D’Ieteren has 1.45 billion in cash. The company was counting on acquisition opportunities with the crisis, but “the preys have not become cheaper”, regrets Deprez.

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