EBITDA and adjusted EBITDA
Six months ended Six months ended
30 June 2021 30 June 2020
Adjusted Adjusted Reported
EBITDA Adjusted EBITDA Adjusted currency
(In EUR million or %) margin^(1) EBITDA margin^(1) EBITDA change
EMEA^(2) 32.2% 38.4 31.6% 122.1
Europe^(2) 33.2% 78.8
MEA^(2) 32.2% 32.4
APAC 27.4% 90.6 29.0% 91.4 (0.8%)
Americas 28.6% 49.8 23.0% 34.8 43.0%
Group Functions^(3) (25.9) (32.6)
Total 27.3% 264.1 25.1% 215.7 22.4%
^(1) Adjusted EBITDA divided by revenue from transactions with external customers.
^(2) Two months' adjusted EBITDA for EMEA in 2021, four months' adjusted EBITDA for Europe and MEA in 2021.
^(3) Group Functions include activities that are supportive to the Group business.
Adjusted EBITDA increased to EUR264.1 million in the first half of 2021, including the consolidation of earnings from the Middle East and Africa business since March. The adjusted EBITDA margin compared with the first half of 2020 was significantly higher at 27.3%. The margin benefited from operating leverage and from lower raw material costs due to hedge contracts entered into during 2020. These more than offset the impact of higher spot prices for aluminium and polymers. SG&A costs were also lower compared with the first half of 2020.
Reported EBITDA increased to EUR283.5 million from EUR213.9 million in the first half of 2020.
Net income and adjusted net income
Adjusted net income increased to EUR109.6 million from EUR79.6 million in H1 2020. The increase primarily reflects the improvement in adjusted EBITDA, which was partly offset by additional depreciation and amortisation as a result of the Middle East and Africa acquisition.
Net income was EUR92.0 million compared with EUR10.0 million in H1 2020. The increase in net income in 2021 reflected impacts of the acquisition accounting, which are non-cash, the non-recurrence of foreign exchange losses in 2020 and a positive contribution from the revaluation of commodity derivatives. These were partly offset by non-cash expenses of EUR22.4 million related to the sale of the mill in New Zealand and the closure of a production plant in Australia.
Gross capital expenditure was EUR113.0 million in the first half of 2021 (H1 2020: EUR100.2 million). The increase was due to higher investment in filling machines. Net capital expenditure, after deduction of upfront cash received from customers, was EUR68.0 million (7.0% of revenue) compared with EUR80.2 million (9.3% of revenue) in H1 2020.
Free cash flow
Six months Six months
30 June 30 June
(In EUR million) 2021 2020
Net cash from operating activities 150.5 127.9
Dividends received from joint ventures - 7.1
Acquisition of PP&E and intangible assets (113.0) (100.2)
Payment of lease liabilities (12.5) (6.7)
Free cash flow 25.0 28.1
Net cash from operating activities increased versus H1 2020 and includes operating cash flow from the consolidation of the Middle East business. This was partly offset by the absence of dividends from the Middle East joint ventures. Free cash flow also reflected higher capex and lease payments. The Group's cash generation is weighted towards the second half of the year due to the seasonality of the business.
At the end of February, SIG paid EUR167.0 million to the Obeikan Investment Group (OIG), representing the cash component of the consideration for OIG's 50% share in the Middle East joint ventures. The Company also assumed EUR36.1 million of net indebtedness (excluding lease liabilities) from the Middle East joint ventures.
A dividend of CHF 0.42 per share was paid out of capital contribution reserves on 28 April 2021, equating to a total distribution of approximately EUR128.1 million. Net leverage at end-June 2021 was unchanged compared with end-June 2020 and reflects the seasonality of cash flow.
As of As of As of
30 June 30 June 31 Dec.
(In EUR million) 2021 2020 2020
Gross total debt 1,828.4 1,609.8 1,697.0
Cash and cash equivalents^(1) 152.0 159.9 355.1
Net total debt 1,676.4 1,449.9 1,341.9
Total net leverage ratio (last twelve months)^(2) 2.9x 2.9x 2.7x
^(1) Includes restricted cash. ^(2) Net total debt divided by LTM adjusted EBITDA. LTM adjusted EBITDA for 2021 includes the LTM adjusted EBITDA of the acquired joint ventures and deducts the dividend SIG received from the joint ventures in the LTM period. ^
Full year outlook
For the full year, the Company expects core revenue growth on a like-for-like basis of 4-6% at constant currency. Whereas earlier in the year growth was expected to be in the lower half of this range, the strong first half performance opens up the possibility of growth in the upper half of the range. The outturn will, however, depend on the evolution of COVID-19 related uncertainties in the second half.
Assuming no major deterioration in exchange rates, the adjusted EBITDA margin is expected to be within the 27-28% range. Net capital expenditure is forecast to be within the targeted 8-10% of revenue range in 2021 and mid-term.
Interim financial statements for the first half of 2021 are available for download at https://www.sig.biz/investors/ en/performance/historical-financial-statements.
Jennifer Gough +41 52 543 1229 Director Investor Relations SIG Combibloc Group AG Neuhausen am Rheinfall, Switzerland firstname.lastname@example.org
Lemongrass Communications Andreas Hildenbrand +41 44 202 5238 email@example.com
About SIG SIG is a leading systems and solutions provider for aseptic carton packaging. We work in partnership with our customers to bring food and beverage products to consumers around the world in a safe, sustainable and affordable way. Our unique technology and outstanding innovation capacity enable us to provide our customers with end-to-end solutions for differentiated products, smarter factories and connected packs, all to address the ever-changing needs of consumers. Sustainability is integral to our business and we are going Way Beyond Good to create a net positive food packaging system.
Founded in 1853, SIG is headquartered in Neuhausen, Switzerland. The skills and experience of our approximately 5,900 employees worldwide enable us to respond quickly and effectively to the needs of our customers in over 60 countries. In 2020, SIG produced 38 billion carton packs and generated EUR1.8 billion in revenue. SIG has an AA ESG rating by MSCI, an 18.8 (low risk) score by Sustainalytics and a Platinum CSR rating by EcoVadis. For more information, visit www.sig.biz.
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