Essilor confident before a decisive step for its merger with Luxottica

Paris – Essilor's sales declined in the second quarter, affected by exchange rates, but accelerated at constant parities, allowing the group to maintain its annual targets before the expected finalization of its merger with the company. Italian Luxottica.
  

Quarterly sales totaled 1.9 billion euros, down 1.1% on a reported basis, due to the negative impact of the strong euro, according to results released Thursday.

But its level is in accordance with the expectations of consensus badysts Factset, and it is up 4.8% over one year in " homogeneous base ", that is to say at constant exchange rates and perimeter, a marked improvement over the growth rate of the first quarter (+ 3.2%).

The main division of the group, " Glbades and optical equipment ", notably progressed from April to the end of June (+ 4.2% in homogeneous base) to 1.62 billion euros , thanks to strong performances in the United States, China and Brazil, while Europe lagged (+ 1.1%).

The activity of its solar division (" Sunglbades and Readers ") increased by 9.5% in the same quarter last year, with a " strong contribution "of its Chinese brand of sunglbades Bolon, pointed Essilor.

For the first half of the year, the group's total sales exceeded 3.72 billion euros (-3.5% as reported, + 4% on a like-for-like basis), for an operating margin ( " contribution of activity ") amounting to 18.4% of turnover, against 18.6% a year earlier.

" With this first half-year and many commercial initiatives coming in the second half of the year ", Essilor confirmed Thursday its objectives for the current year, namely sales growth in a homogeneous base around 4%, for a margin " greater or equal " to 18.3% of turnover, according to the statement.

– Chinese green light deemed imminent –

Investors welcomed these announcements: the title Essilor gained 2.06% to 126.5 euros shortly after 10:00 (8:00 GMT) on the Paris Bourse, while the CAC 40 took 0.71% around the same time.

While the half-year net profit decreased by more than 10% to 349 million euros, this result only decreased by 2.3% on an adjusted basis to the charges recognized in the context of the proposed merger with Luxottica .

Essilor and Luxottica, world giants of branded glbades mainly exploited under license (Chanel, Prada, Ralph Lauren …) but also sometimes owned (Ray-Ban, Persol, Oakley), had announced there are more of a year and a half their intention to merge, in order to create an integrated mastodon of optics, combining glbades and frames.

But the finalization of this project has been delayed many times, due to delays in approval by various competition authorities around the world.

The two groups got the green light from the EU and US competition authorities at the beginning of March, but are still waiting for China's approval, which is essential for the completion of the operation.

The green light from Beijing would however be imminent: the two groups are " on the verge of finalizing their discussions with the Chinese competition authority and are confident in getting their agreement from here. the end of July ", said Essilor in its release of results.

Same tone Luxottica, which published Monday its own half-year results: the group had reported a turnover down 4.9% in the second quarter, to 2.4 billion euros, but up 1.4% at constant currencies, led by North America and Asia Pacific in particular.

The new entity, called EssilorLuxottica, should represent an annual turnover of more than 16 billion euros, for a market valuation of some 50 billion euros.

Its headquarters must be located in the Paris suburbs and the group must be listed on the Paris Stock Exchange.