Dufry on course for improved 2021
Dufry reported its turnover for Q1 of 2021was CHF 460.3 million (US$512.25 million) with organic growth of -73.9% compared to 2019. Turnover was CHF 1,438.7 million (US$1601.09 million) in the same period in 2020 and versus CHF 1,882.6 million (US$2095.09 million) for the same period in 2019.
Organic growth Q1 2021 was -66.7% vs Q1 2020, and -73.9% versus Q1 2019.
Like-for-like performance was -68.3% vs 2020, with ongoing travel reductions.
New concessions produced a positive 1.6%, though the translational FX effect in the period was negative at -1.3%, mainly as a result of USD devaluation, the currency in which most of turnover was generated in Q1 2021.
The company has continued with strong savings measures and cash generation, which is putting it in a good position as recovery continues throughout 2021. Dufry reports a strong liquidity position of CHF 2,213.7 million (US$2463.56 million).
Dufry is projected to achieve CHF 530-670 million (US$590 to US$746 million) savings compared to 2019, and hassigned MAG reliefs for 2021 of approximately CHF 300 million (US$333.86 million).
The company’s cash consumption was better than expected in Q1 2021, reaching CHF 219.3 million (US$244 million).
Positive signs noted by the company in a recent conference on its financial state include the restarting of travel, especially in association with vaccinations and travel protocols, with the US, Central America and the Caribbean as particular high points.
Approximately 60% of Dufry stores are now open, with nearly 70% of sales capacity. Given the state of international travel, duty paid remains an especially important part of Dufry’s sales. In kind, the company introduced “The Americas” segment, with centralized logistics platform, regional operations and decision-making processes.
Refinancing has helped to reduce Dufry’s debt load substantially with no relevant maturities before 2024, and an extension of covenants holiday for another 12 months
During this quarter in partnership the company opened the strategically important duty-free operation inHainan.
Julián Díaz, CEO of Dufry Group, commented: “We are seeing encouraging signs for resuming travel trends and shop re-openings in the regions that have most progressed with vaccination campaigns and have establishedcross-border travel protocols accompanied by clear procedures and necessary documentation for travelers. Customer behavior indicates continued demand for travel and travel retail, and we are well positioned toaccelerate sales with further re- openings. The close relationship with our landlords, suppliers, employees and shareholders continues to be a valuable support during the recovery. We are confirming the scenarios we have laidout for 2021, and are confident that we can achieve the targeted cost savings for the year.
“As part of the re-organization and the streamlining of our processes, we have now merged our North, Central and South America businesses into one reporting segment to reflect the decision- making process for the region. This step has been facilitated by the completed Hudson re- integration as well as the alignment of our operationsand logistic platforms.
“Over the last weeks, we have successfully executed the refinancing of all relevant maturities until 2024 at attractive terms by applying a diversified product mix of convertible bonds, senior notes and bank debt. Thisallowed us to reduce our net debt position while securing additional liquidity, which currently stands at CHF 2,213.7 million. In addition, we achieved an extension of the covenant holiday by another twelve months with the next testing now due in September 2022, and an increased threshold for both September and December 2022.
“The further strengthened financial profile adds to the significant achievements realized in 2020 with respect to the implementation of recurring cost savings of CHF 400 million, tight cash flow management and several financialinitiatives to safeguard liquidity. We currently see progress on the re-openings in the US and Central America, and on plans communicated by authorities globally for collaboration on cross-border travel. The new organizationalsetup and strong liquidity position allows us to drive the recovery, while also engaging in strategic partnerships andopportunities to accelerate growth.”