Regulated information, Leuven, 31 August 2018 (17.40 hrs CEST)
KBC Ancora recorded a profit of EUR 215.0 million in the financial year 2017/2018, equivalent to EUR 2.75 per share. This compares with a profit of EUR 843.2 million in the previous financial year - though that amount included a reversal of impairments to an amount of EUR 646.5 million. The full-year result was determined by the combination of dividend income from the participating interest in KBC Group (EUR 232.5 million), operating costs (EUR 2.5 million) and interest charges (EUR 15.2 million). The result in the second half of the financial year was EUR 146.2 million, or EUR 1.87 per share. KBC Ancora distributed an interim dividend of EUR 2.61 per-share on 7 June 2018 and, as announced earlier, will not pay a final dividend.
The Board of Directors of Almancora Société de gestion, statutory manager of KBC Ancora SCA, hereby announces the annual figures for the financial year ended 30 June 2018, subject to the approval of the General Meeting of KBC Ancora Shareholders to be held on 26 October 2018.
Abridged financial summaries and notes [1]
Results for the financial year
| Financialyear (x EUR 1,000) | 2017/2018 per share (in EUR) | Financialyear (x EUR 1,000) | 2016/2017 per share (in EUR) | |
| Income | 232,658 | 2.97 | 863,630 | 11.03 |
| Dividends from financial fixed assets | 232,549 | 2.97 | 217,046 | 2.77 |
| Reversal of impairments of financial fixed assets | 0 | 0.00 | 646,487 | 8.26 |
| Other income | 109 | 0.00 | 98 | 0.00 |
| Expenses | 17,610 | 0.22 | 20,423 | 0.26 |
| Cost of debt | 15,153 | 0.19 | 18,132 | 0.23 |
| Services and sundry goods | 2,456 | 0.03 | 2,290 | 0.03 |
| Other costs | 2 | 0.00 | 1 | 0.00 |
| Result after taxes | 215,048 | 2.75 | 843,208 | 10.77 |
| Number of shares in issue* | 78,301,314 | 78,301,314 |
* No instruments have been issued which could lead to dilution.
KBC Ancora recorded a profit of EUR 215.0 million in the financial year 2017/2018, compared with a profit of EUR 843.2 million in the previous financial year. A substantial reversal of impairments that had been applied to the participating interest in KBC Group was effected in the previous financial year, amounting to EUR 646.5 million. Without this reversal, KBC Ancora would have ended the financial year 2016/2017 with a profit of EUR 196.7 million. Income (EUR 232.7 million) principally comprised the dividend received on the participating interest in KBC Group (EUR 232.5 million). Expenses (EUR 17.6 million) consisted mainly of the usual operating costs (EUR 2.5 million) and interest charges (EUR 15.2 million).
Developments in the last six months of the financial year 2017/2018
Final dividend on participating interest in KBC Group
On publication of its annual results, KBC Group announced on 22 February 2018 that, following the payment of an interim dividend of EUR 1.00 per share in November 2017, it would be paying a final dividend of EUR 2.00 per share in respect of the financial year 2017. As a result, on 9 May 2018 KBC Ancora received dividends totalling EUR 155.0 million, taking the total dividend income from the participating interest in KBC Group for the full year 2017/2018 to EUR 232.5 million.
KBC Ancora interim dividend
On 7 June 2018 KBC Ancora distributed an interim dividend of EUR 2.61 gross per share to its shareholders, a total payout of EUR 204.4 million. As already announced, KBC Ancora will not pay a final dividend.
Participating interest in KBC Group, net debt position and net asset value
KBC Ancora did not buy or sell any KBC Group shares in the second half of the financial year 2017/2018, and holds 77,516,380 KBC Group shares.
The net asset value of the KBC Ancora share corresponds to 0.99 times the price of the KBC Group share, less the net debt [2] per share. KBC Ancora's net debt position as at 30 June 2018 stood at EUR 4.55 per share.
Based on the price of the KBC Group share on 30 June 2018 (EUR 66.12), the net asset value of one KBC Ancora share amounted to EUR 60.91, and the KBC Ancora share (EUR 45.92) was trading at a discount of 24.6% to its net asset value.
Based on the closing price of the KBC Group share on 30 August 2018 (EUR 61.16), the net asset value of one KBC Ancora share amounted to EUR 56.00, and the KBC Ancora share (EUR 43.86) was trading at a discount of 21.7% to the net asset value.
The following charts illustrate the movements in the price of the KBC Group and KBC Ancora shares and the discount of the KBC Ancora share to its net asset value.
| Trend in KBC Group and KBC Ancora share price (July 2017 - June 2018) | Trend in discount of KBC Ancora share to its net asset value (July 2017 - June 2018) |
Result for the second half of the financial year 2017/2018
| 2H FY (x EUR 1,000) | 2017/2018 per share (in EUR) | 2H FY (x EUR 1,000) | 2016/2017 per share (in EUR) | |
| Income | 155,063 | 1.98 | 786,063 | 10.04 |
| Dividends from financial fixed assets | 155,033 | 1.98 | 139,529 | 1.78 |
| Reversal of impairments of financial fixed assets | 0 | 0.00 | 646,487 | 8.26 |
| Other income | 30 | 0.00 | 47 | 0.00 |
| Expenses | 8,833 | 0.11 | 10,044 | 0.13 |
| Cost of debt | 7,576 | 0.10 | 8,857 | 0.11 |
| Services and sundry goods | 1,256 | 0.02 | 1,186 | 0.02 |
| Other costs | 1 | 0.00 | 1 | 0.00 |
| Result after taxes | 146,230 | 1.87 | 776,019 | 9.91 |
| Number of shares in issue* | 78,301,314 | 78,301,314 |
In the second half of the financial year KBC Ancora recorded a profit after tax of EUR 146.2 million. In the same period in the previous financial year, KBC Ancora recorded a profit of EUR 776.0 million, largely due to a substantial reversal (EUR 646.5 million) of impairments which had been applied to the participating interest in KBC Group. Without this reversal, KBC Ancora would have ended the second half of the financial year 2016/2017 with a profit of EUR 129.5 million.
Income in the second half of the financial year (EUR 155.1 million) was determined principally by the final dividend of EUR 2.00 per share distributed by KBC Group in May 2018. This generated dividend income for KBC Ancora totalling EUR 155.0 million. Over the same period in the previous financial year, KBC Ancora received dividend income totalling EUR 139.5 million on its participating interest in KBC Group.
Expenses in the second half of the financial year (EUR 8.8 million) were determined chiefly by the following factors:
- Usual operating costs amounted to EUR 1.3 million, EUR 0.1 million more than in the same period in the previous financial year. Of this total, EUR 0.9 million relates to costs incurred within the cost-sharing agreement with Cera. Other costs consisted among other things of listing fees, fees for financial services and management costs.
- Costs associated with debt amounted to EUR 7.6 million, EUR 1.3 million less than in the same period in the previous financial year. This is explained by the reduction since May 2017 in the interest rate applying to the EUR 175 million debt maturing in 2019, as agreed when this debt was extended in 2015.
Balance sheet as at 30 June 2018
| (x EUR 1,000) | 30.06.2018 | 30.06.2017 | 30.06.2016 |
| BALANCE SHEET TOTAL | 3,108,930 | 3,098,303 | 2,441,801 |
| Assets | |||
| Fixed assets | 3,088,253 | 3,088,253 | 2,441,766 |
| Financial fixed assets | 3,088,253 | 3,088,253 | 2,441,766 |
| Current assets | 20,678 | 10,050 | 35 |
| Liabilities | |||
| Equity | 2,732,313 | 2,721,632 | 2,045,206 |
| Issued capital | 2,021,871 | 2,021,871 | 2,021,871 |
| Legal reserve | 59,445 | 48,693 | 7,541 |
| Unavailable reserves | 650,117 | 650,117 | 35,955 |
| Profit (loss) carried forward | 879 | 950 | -20,161 |
| Creditors | 376,617 | 376,671 | 396,595 |
| Amounts falling due after more than one year | 200,000 | 375,000 | 375,000 |
| Amounts falling due within one year | 175,186 | 239 | 19,883 |
| Accruals and deferrals | 1,431 | 1,432 | 1,712 |
Total assets stood at EUR 3.1 billion as at 30 June 2018.
The number of KBC Group shares in portfolio remained unchanged in the year under review. As at the balance sheet date, KBC Ancora had a total of 77,516,380 KBC Group shares in portfolio, The net book value of the KBC Group shares was unchanged, at EUR 39.84 per share. The price of the KBC Group share on the balance sheet date was EUR 66.12.
Amounts owed to creditors were virtually unchanged at EUR 376.6 million; EUR 375 million of this total comprised financial debt. Current assets rose by EUR 10.6 million.
After addition of the result carried forward from the previous financial year (EUR 1.0 million), the result available for appropriation amounted to EUR 216.0 million. The following appropriation of profit will be proposed to the General Meeting of Shareholders to be held on 26 October 2018:
- addition of EUR 10.8 million (5% of the profit for the financial year) to the legal reserve;
- a distributable profit of EUR 204.4 million. This amount was paid out on 7 June 2018 in the form of an interim dividend of EUR 2.61 per share;
- carry-forward of the balance of EUR 0.9 million, or EUR 0.01 per share, to the next financial year.
Notes on anticipated developments in the financial year 2018/2019
Costs within the cost-sharing agreement with Cera are expected to amount to approximately EUR 1.8 million. The total interest charge for the financial year 2018/2019 is estimated at approximately EUR 15.5 million. Other operating costs are likely to be around EUR 0.9 million.
During the Investor Event held in Ireland in June 2017, KBC Group reaffirmed its intention of aiming for a dividend payout ratio (including the coupon on the outstanding Additional Tier-1 instruments) of at least 50% of the consolidated profit. Barring exceptional or unforeseen circumstances, KBC Group will distribute an interim dividend of EUR 1.00 per share in November each year, followed by a final dividend after the Annual General Meeting of Shareholders. The interim dividend will serve as an advance payment on the total dividend. In its press release dated 9 August 2018, KBC Group announced that it would be paying an interim dividend of EUR 1.00 to its shareholders on 16 November 2018.
Information on the external audit of the annual accounting data
The auditor, KPMG Réviseurs d'entreprises, represented by Olivier Macq, has issued an unqualified opinion on the financial statements and has confirmed that the accounting data included in this press release contain no obvious inconsistencies compared with the financial statements.
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KBC Ancora is a listed company which holds 18.6% of the shares in KBC Group and which together with Cera, MRBB and the Other Permanent Shareholders is responsible for the shareholder stability and further development of the KBC group. As core shareholders of KBC Group, these parties have signed a shareholder agreement to this effect.
Financial calendar: 25 September 2018 Annual Report 2017/2018 available and convocation to Annual General Meeting of Shareholders 26 October 2018 Annual General Meeting of Shareholders 25 January 2019 Interim financial report (1H) 30 August 2019 Annual press release for the financial year 2018/2019
This press release is available in Dutch, French and English on the website www.kbcancora.be.
KBC Ancora Investor Relations & Press contact: Jan Bergmans Tel.: +32 (0)16 279672 E-mail: jan.bergmans@kbcancora.be or mailbox@kbcancora.be
[1] KBC Ancora's reporting is based on Belgian GAAP.
[2] Net debt is defined here as total liabilities less total assets excluding financial fixed assets.
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