COLAS (EPA:RE) - CP COLAS - 1st Quarter 2020 - English

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14/05/2020 07:30

PRESS RELEASE

PARIS 14/05/2020

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                          1st Quarter 2020 Results

* Order Backlog: EUR10.0 B, up 3% after restatement to reflect main
  acquisitions and divestments, and at constant exchange rates
* Revenue: EUR2.0 B (-14% and -10% at constant scope and exchange rates)
* Current operating profit: -EUR370 M (-EUR72 M)
* Net profit attributable to the Group: -EUR300 M (-EUR73 M)

The Board of Directors of Colas, chaired by Mr. Olivier Roussat, met on May 12,
2020 to examine the situation as of March 31, 2020 and outlook for the current
year.

Consolidated key figures

In millions of euros            Q1 2019  Q1 2020  Change   Change at constant
                                                           scope and exchange
                                                                  rates

Consolidated revenue             2,287    1,959    -14%           -10%
of which France                  1,353    1,024    -24%           -17%
of which International             934      935      =              =
Current operating profit          (298)    (370)   -72
Operating profit                  (298)    (370)   -72
Net profit attributable to
the Group                         (227)    (300)   -73
Net debt(a)                      1,068      944   -124

The consolidated financial statements for Q1 2020 have been prepared in
accordance with IFRS 16 applicable as of January 1, 2019.
(a) See definition in glossary page 6.

Impact of Covid-19 pandemic

Following the lockdown measures taken by the French government, all
construction sites and production sites in France were stopped as of March 17.
Activity also slowed sharply in Belgium and Switzerland during the second half
of March.

In many other countries, Colas was able to maintain a significant level of
business in March despite lockdowns. This was particularly true in the USA
where construction has been declared an "essential business" in many states.

Similarly, across most of Central Europe, Africa and Asia-Oceania, the Group
was able to conduct business in a very close to normal fashion throughout the
month of March.

The expansion of the Covid-19 pandemic prompted the Executive General
Management Committee to quickly roll out measures intended to protect the
health of Colas employees. Crisis teams have been meeting daily to closely
monitor the situation in each of the Group's locations. Dedicated communication
resources have been developed to ensure that employees are kept up to date on a
regular basis.

Changes in business segments

Following the roll out of a new organization as of January 1, 2020, the
business segments are now presented as follows:

- Roads Mainland France / French Overseas and Indian Ocean comprises Roads and
Safety-Signaling activities in Mainland France, in the French overseas
departments and regions and in the Indian Ocean;

- Roads EMEA (Europe - Middle East - Africa) covers Roads in Europe (excluding
France), the Middle East and Africa;

- Roads USA includes Roads in the United States;

- Roads Canada covers Roads in Canada;

- Roads Asia / Pacific includes Roads in Asia, Oceania and Latin America;

- Railways and other Activities comprises Railways and Water & Energy Transport
in France and around the world;

- The Parent Company includes the activities inherent to Colas' head office.

Seasonal nature of business activity

Due to the highly seasonal nature of most of the Group's businesses, operating
losses are recorded each year during the 1st quarter.

Order backlog

The order backlog at the end of March 2020 remained high at EUR10 billion, up
3% restated to reflect the main acquisitions and divestments and at constant
exchange rates. Backlog in Mainland France (EUR3.5 billion) is up 1%, restated
to reflect the main acquisitions and divestments, while backlog for
international and overseas units (EUR6.5 billion) rose 4%, restated to reflect
the main acquisitions and divestments and at constant exchange rates.

Revenue

Consolidated revenue for the 1st quarter of 2020 amounted to EUR2.0 billion,
down 14% compared to the 1st quarter of 2019 (-10% at constant scope and
exchange rates). Revenue in France totaled EUR1.0 billion (-24%, and -17% at
constant scope and exchange rates). In the international units, business has
remained stable, totaling EUR0.9 billion.

During the second half of March, the sudden slump in business activity as a
consequence of the Covid-19 pandemic led to a drop in revenue estimated at
around EUR260 million.

Roads:

Revenue for the 1st quarter 2020 totaled EUR1.7 billion, down 10% at constant
scope and exchange rates.

The drop is particularly noticeable in Mainland France / Overseas & IO, where a
17% decrease was recorded compared to Q1 2019 as the zone has been strongly
impacted by the consequences of the Covid-19 pandemic.

Business is up in the EMEA zone (+ 5% at constant scope and exchange rates) as
well as in the United States (+ 4% at constant scope and exchange rates). At
constant scope and exchange rates, revenue fell 8% in Canada and 10% in
Asia-Pacific.

Railways and other Activities:

After restating the sale of Smac, whose contribution to Q1 2019 revenue
amounted to EUR141 million, revenue in Railways and other Activities decreased
by 5% compared to Q1 2019.

Financial performance

Current operating profit for the 1st quarter of 2020 stood at -EUR370 million,
down EUR72 million compared to Q1 2019. Business got off to a good start at the
beginning of the year but a sharp drop in business as of mid-March accentuated
1st quarter seasonal losses, particularly in France.

Despite measures to adapt and remain flexible, in particular the use of partial
furlough in France for 40% of manhours in March, the impact of the crisis on
current operating profit is estimated at around -EUR75 million (loss of current
operating profit margin and unavoidable costs).

The crisis has had no impact on the valuation of the Group's non-current assets
as of March 31, 2020.

Net profit attributable to the Group totaled -EUR300 million, compared to
-EUR227 million at the end of March 2019.

Net debt

Net debt at March 31, 2020 was EUR944 million, a EUR124-million improvement
compared to March 31, 2019. The Group has a solid balance sheet and high
liquidity ensured by confirmed credit lines without covenants.

Developments since March 31

In April, business was significantly reduced in France due to the ongoing
lockdown. Some countries, e.g., the United Kingdom or Ireland, which were not
very impacted in March, witnessed a drop in activity in April.

In France, quarry production has resumed gradually since mid-April, followed by
the construction business. Opening back up is only possible once the safety of
all employees is ensured, personal protective equipment is available, the
customer has agreed and all employees are on board and mobilized. Thus, by
mid-May, 85% of road construction sites have been relaunched in Mainland
France.

Our businesses are reopened without compromising the health and safety of all
participants on site. In France, Colas has rolled out its own protocols, with 4
guides for managers and 9 information posters.

Outlook

Uncertainty resulting from the health crisis and its impact on the Group led
the Board of Directors of Colas to suspend its revenue and current operating
profit margin targets for the year 2020, as announced on April 1.

Colas confirms that it is setting targets in 2020 to reduce its greenhouse gas
emissions in line with the Paris Agreement, and that it will be communicating
its action plan on how it will achieve them.

Despite the gradual easing of lockdown measures in many countries since the
beginning of May, the impact of the Covid-19 pandemic on Colas' business and
results should be stronger in the 2nd quarter.

However, it is still too early to formulate outlook for 2020 as a whole.

Colas (www.colas.com)

Colas, a subsidiary of the Bouygues Group, is a world leader whose mission is
to promote transport infrastructure solutions for sustainable mobility. With
57,000 employees in more than 50 countries on five continents, the Group
performs some 70,000 road construction and maintenance projects each year via
800 construction business units and 3,000 material production units.

In 2019, consolidated revenue at Colas totaled EUR13.7 billion (52% outside of
France). Net profit attributable to the Group amounted to EUR261 million.

For further information
Delphine Lombard (tel. : +33 6 60 07 76 17) /
Rémi Colin (tel.: +33 7 60 78 25 74) contact-presse@colas.fr
Jean-Paul Jorro (tel.: +33 1 47 61 74 23) /
Zorah Chaouche (tel.: +33 1 47 61 74 36) contact-investors@colas.fr

Condensed consolidated 1st quarter income statement

In millions of euros        2019     2020     Change

Revenue                    2,287    1,959      -14% (a)
Current operating profit    (298)    (370)     -72
Operating profit            (298)    (370)     -72
Net profit attributable to
the Group                   (227)    (300)     -73

(a) -10% at constant scope and exchange rates

Revenue at March 31 by business segment

In millions of euros         At            At
                        31/03/2019     31/03/2020   Change  Change constant
                                                           scope and exchange
                                                                 rates
Roads Mainland France/
Overseas, IO               1,148           953       -17%        -17%
Roads EMEA                   331           349        +6%         +5%
Roads United States          168           189       +12%         +4%
Roads Canada                  93            88        -6%         -8%
Roads Asia - Pacific         111           102        -8%        -10%
Total Roads                1,851         1,681        -9%        -10%
Railways and other
Activities                   431           277       -36%         -5%
Parent Company                 4             1        ns           ns
TOTAL                      2,287         1,959       -14%        -10%

Glossary

Order Backlog: the amount of work still to be done on projects for which a firm
order has been taken, i.e. the contract has been signed and has taken effect
(after notice to proceed has been issued and suspensory clauses have been
lifted).

Changes in revenue at constant scope and exchange rates:

- at constant exchange rates: change after translating foreign-currency sales
   for the current period at the exchange rates for the comparative period;
- at constant scope: change in revenue for the periods compared, adjusted as
   follows:
    . for acquisitions, by deducting from the current period those sales of
      the acquired entity that have no equivalent during the comparative
      period;
    . for divestments, by deducting from the comparative period those sales of
      the divested entity that have no equivalent during the current period.

Net surplus cash/(net debt): the aggregate of cash and cash equivalents,
overdrafts and short- term bank borrowings, non-current and current debt, and
financial instruments. Net surplus cash/(net debt) does not include non-current
and current lease obligations. A positive figure represents net surplus cash
and a negative figure represents net debt.

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COLAS (EPA:RE) - CP COLAS - 1st Quarter 2020 - English

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