FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: SODEXHO ALLIANCE SA
CENTRAL INDEX KEY: 0001169715
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741]
IRS NUMBER: 000000000
FISCAL YEAR END: 0831
FILING VALUES:
FORM TYPE: 6-K
SEC ACT: 1934 Act SEC
FILE NUMBER:
FILM NUMBER:
BUSINESS ADDRESS:
STREET 1: 3 AVENUE NEWTON
STREET 2: 78180 MONTIGNY-LE-BRETONNEUX
CITY: FRANCE
STATE:
ZIP: 00000
BUSINESS PHONE: 0113313085
6-K
FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
May 11, 2004
SODEXHO ALLIANCE SA
3, avenue Newton
78180 Montigny-le-Bretonneux
France
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
Contents: Fiscal 2003-2004 Half-Year Results
EXHIBIT LIST
Exhibit Description
99.1 Fiscal 2003-2004 Half-Year Results
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SODEXHO ALLIANCE SA
By: /s/ Sian Herbert-Jones
-------------------------------
Name: Sian Herbert-Jones
Title: Chief Financial Officer
Date: May 11, 2004
EX-99.1
Fiscal 2003-2004 Half-Year Results
Exhibit 99.1
Fiscal 2003-2004 Half-Year Results
Code EURONEXT: EXHO.PA / Code NYSE: SDX
This press release contains "forward-looking statements" within the meaning of
the United States Private Securities Litigation Reform Act of 1995. These
include, but are not limited to, statements regarding anticipated future events
and financial performance with respect to our operations. Forward-looking
statements can be identified by the fact that they do not relate strictly to
historical or current facts. They often include words like "believe," "expect,"
"anticipate," "estimated" , "project ", "plan", "pro forma," and "intend" or
future or conditional verbs such as "will," "would," or "may." Factors that
could cause actual results to differ materially from expected results include,
but are not limited to, those set forth in our Registration Statement on Form
20-F, as filed with the Securities and Exchange Commission (SEC), the
competitive environment in which we operate, changes in general economic
conditions and changes in the French, American and/or global financial and/or
capital markets. Forward-looking statements represent management 's views as of
the date they are made, and we assume no obligation to update any
forward-looking statements for actual events occurring after that date. You are
cautioned not to place undue reliance on our forward-looking statements.
Group net income increased by 12.7%
and by 24.3% excluding currency effects
Paris - May 6, 2004 - The Board of Directors of Sodexho Alliance (Euronext:
EXHO.PA / NYSE:SDX) met on May 4, 2004 under the chairmanship of Pierre Bellon
to examine the interim financial statements for the six months ended February
29, 2004.
Financial performance for the first half of 2003-2004
Six months Six months % change Currency % change
ended ended excluding effects
February 28, February 29, currency
2003 2004 effects
Revenues 6,198 5,890 +3.9% -8.4% -4.5%
EBITA 294 281 +4.0% -8.7% -4.7%
Group net
income 86 97 +24.3% -11.6% +12.7%
o The organic growth in revenues, at constant consolidation scope and excluding
currency effects, was 3.9%, compared to 2.9% for the prior comparable period.
o The euro's sharp appreciation against other currencies, notably the US dollar,
led to a translation effect in the consolidated accounts which reduced reported
revenues by 8.4%, EBITA by 8.7% and Group net income by 11.6%. However, unlike
exporting companies, our subsidiaries revenues and expenses are denominated in
the same currency. Consequently, currency fluctuations do not create operating
risk for Sodexho.
o Excluding currency effects:
o EBITA increased by 4%, which represents an EBITA margin of 4.8%
o Group net income after goodwill amortization increased by 24.3%.
Food and Management Services
North America
The organic growth in revenues in the first-half of 2003/2004 was 4.1%, as
compared to 3.3% for the prior comparable period. With organic growth rates of
5.8% in the Education segment and 4% in the Healthcare and Seniors segments, the
Sodexho teams continue to implement the development strategy of the Group -
client retention, increasing sales on existing sites and the conversion of
self-operated accounts. In the Business and Industry segment, revenues decreased
by 0.7%, mainly due to the impact of delocalizations and the absence, as of
today, of any sign of increased employment in large businesses. The Defense
segment benefited from one additional month of activity in the 55 sites for the
US Marine Corps as compared to the prior comparable period. From the beginning,
this contract has required great flexibility from our local teams to adapt to
the client's frequently changing needs.
During the first-half of 2003/2004, we achieved commercial successes such as
Novartis Research Center, Harley Davidson, the World Bank Conference Center, the
public schools of Saint-Louis, the University of Concordia (Wisconsin) and the
University of Tulsa (Oklahoma). In Canada, Sodexho signed the largest contract
ever in the public healthcare sector with the Vancouver Coastal Health and
Providence Authority. This 10-year contract valued at CAD 405 million (EUR 240
million) includes 22 hospital and retirement home sites.
EBITA was EUR 146 million, with an EBITA margin of 5.5% after taking into
account the additional amortization costs in connection with our investments in
information systems implemented during the prior fiscal year.
Continental Europe
Organic growth of revenues in the first-half of 2003/2004 was 3.3%, as compared
to 4.9% in the prior comparable period, mainly due to:
- a difficult economic environment in the Business and Industry segment in
France and in Northern Europe, and
- a more competitive market for public contracts in Scandinavia and in
Southern Europe.
In this environment, the Business and Industry segment achieved an organic
growth of 2.6%. The organic growth in the Education and Healthcare and Senior
segments was 3.6% and 4.9%, respectively.
A number of major contracts were signed during the first-half of 2003/2004, such
as Alcatel Space and Generali in France, Sambacy Group in Turkey and Gavle in
Sweden, the school systems of Frankfurt, Milan, Sienna and Budapest, the
University of Utrecht, 20 centers for the disabled in Fejer, Hungary and the
Fremap clinic in Spain.
EBITA was EUR 87 million with an EBITA margin of 4.6%. The first half results
reflected difficulties and subsequent reorganization in the meals delivery
activity in Education, in metropolitan Paris, which weighed temporarily on the
operating margin.
United Kingdom and Ireland
Revenues decreased by 7.2% due to the termination of loss-making contracts in
the Business and Industry and Healthcare segments during the prior comparable
period.
In recent months, two long-term contracts, each valued at 19 million euro
annually, were signed: the Colchester Garrison in the Defense segment and the
Havering Hospital in Healthcare.
EBITA was EUR 5 million, or an EBITA margin of 0.8%. These results do not
include EBITA profit of EUR 6 million earned by our British teams, for the Rugby
World Cup in Australia. EBITA margin increased from 0.6% to 1.6%.
The action plan begun 18 months ago to return the subsidiary to profitability is
well underway, and is focused on the following: better control over costs on
each site, the renegotiation or termination of unprofitable contracts, the
training and motivation of the teams, and reductions in overhead costs. Progress
made in this area is partially offset by increases in pension fund
contributions.
The team in the United Kingdom and Ireland, is reinforcing the action plans in
order to restore profitability to a level in line with that of the rest of the
Group.
Rest of the world
In Sodexho's other regions, organic growth was 21.5%, of which almost half
resulted from the hospitality package contract for the Rugby World Cup in
Australia. During the first half, we experienced commercial successes in the
Remote Sites segment with the signing of new contracts such as Chiyoda in the
Sakhalin Islands, the residential complex in Al Khor for Qatargas and the
extension of Shell Rabi in Gabon. The Food and Management Services activity
continues its development in China with the signature of contracts such as
Shanghai Automotive Industry Corporation and Saint Gobain. In Latin America,
growth accelerated as illustrated by numerous commercial successes such as
Siemens and Anglo-American in Brazil and Leonisa in Colombia, and margins are
improving.
EBITA was EUR 19 million with an EBITA margin of 3.4%.
Service Vouchers and Cards
Revenues in the Service Vouchers and Cards activity include client and affiliate
commissions and investment income. Although organic growth for this activity was
only 4.1% for the first half, issue volume of 2.5 billion euro represents an
approximate 10% increase as compared to the prior comparable period, excluding
currency effects.
The general decline in interest rates, notably in Latin America, and the labor
force reductions in businesses, mainly in Germany, have held back growth.
In Great Britain, revenues for the first half of the prior year included
exceptional billings to the Home Office pertaining to the shift from paper
vouchers to smart cards. This new system improves the reliability and the
security of the service while reducing the client's distribution costs.
New contracts continue to be signed, for example, the Aldi Group in Belgium, a
savings bank in Romania, Philip Morris and Unilever in Hungary, Adecco in France
and Ipostel in Venezuela.
EBITA was EUR 37 million with a margin of 29% as compared to 33% in the prior
comparable period. This change resulted mainly from lower interest rates on
financial investments.
Net financial expense
The net financial expense of EUR 65 million improved by EUR 17 million due to
the reduction in debt-related expenses.
Net exceptional expense
Net exceptional expense of EUR 11 million mainly includes:
o the provision recorded for the sale of the subsidiary Medcheque in Brazil
for EUR 6 million, and
o provisions totaling EUR 4 million related to stock options and losses on
treasury shares acquired in connection with existing stock option plans.
Income tax
The effective tax rate decreased from 41% for the first-half 2002/2003 to 35%
for the first-half 2003/2004, mainly as a result of realizing tax deductions on
items which were previously considered non-deductible.
Group net income
Group net income after amortization of goodwill was EUR 97 million, an increase
of 24.3% excluding currency effects.
Outlook
In November 2003, the Board of Directors fixed minimum objectives for 2003-2004.
Today, based on current information, we confirm :
- organic growth in revenues of at least 3.1%,
- EBITA of approximately EUR 550 million,
- Group net income, excluding exceptional items, of EUR 170 million.
These figures are based on the exchange rates used in the fiscal year
2002-2003 financial statements.
Based on current exchange rates, we estimate that the currency variations
will have a negative impact of around 7% to 8% on Group Net Income for the
fiscal year.
The Board of Directors has expressed its confidence in the Group's future
because Sodexho's strengths are numerous:
- Sodexho's values: service spirit, team spirit, and spirit of progress;
- Sodexho's mission: "Improve the quality of daily life", which gives
meaning to all of our team members;
- Sodexho's worldwide network and its presence in 76 countries;
- Sodexho's strong competitive positions;
- Sodexho's excellent financial model.
About Sodexho Alliance
Founded in Marseille in 1966 by Chairman and Chief Executive Officer Pierre
Bellon, Sodexho Alliance is the world's leading provider of food and management
services. With 308,000 employees on 23,900 sites in 76 countries, Sodexho
Alliance reported consolidated sales of 11.7 billion euros for the fiscal year
that ended on August 31, 2003. The Sodexho Alliance share has been listed since
1983 on the Euronext Paris Bourse, where its market value totals 3.7 billion
euro. The Sodexho Alliance share has been listed since April 3, 2002, on the New
York Stock Exchange.
Investor Relations : Jean-Jacques Vironda
Tel : + 33 (1) 30 85 72 03
Fax : + 33 (1) 30 85 51 81
E-mail : jeanjacques.vironda@sodexhoalliance.com
Press Relations : Jerome Chambin
Tel : + 33 (1) 30 85 74 18
Fax : + 33 (1) 30 85 52 32
E-mail : jerome.chambin @sodexhoalliance.com