The EXOR board of directors’ meeting, chaired by John Elkann, met today in Turin and approved the consolidated results to September 30, 2010.
At September 30, 2010, EXOR’s Net Asset Value (NAV) is € 6,624 million, increasing € 1,104 million compared to € 5,520 million at June 30, 2010, and € 3,656 million compared to € 2,968 million at March 1, 2009. The change in NAV compared to the MSCI World Index can be seen below.
The EXOR Group closes the first nine months of 2010 with a consolidated profit of € 56 million; the same period of 2009 ended with a consolidated loss of € 266.6 million. The positive change amounts to € 322.6 million and is due to better results reported by the investment holdings (+€ 271 million), higher net financial income (+€ 46.1 million) and other net changes (+€ 5.5 million).
In the third quarter of 2010, the consolidated profit is € 30.9 million; the corresponding period of 2009 closed with a loss of € 4.7 million. In this case, too, the positive change of € 35.6 million is attributable to better results reported by the investment holdings, (+€ 31.6 million), improved net financial income (expense) (+€ 2.4 million) and other net changes (+€ 1.6 million).
At September 30, 2010, the consolidated equity attributable to owners of the Parent is € 5,797.6 million, increasing by a net € 492.2 million compared to € 5,305.4 million at the end of 2009.
The consolidated net financial position of the Holdings System is positive for € 131 million, increasing € 79.4 million compared to the end of 2009 (+€ 51.6 million).
Investment with the Jardine Matheson Group and Rothschild
Under the agreement reached on June 9, 2010 (committing a maximum of $100 million) for private equity investments in India and China together with the Jardine Matheson Group and Rothschild, on September 30, 2010, EXOR S.A. has made a first investment of € 2.8 million.
Investment in NoCo B L.P.
As part of the commitments for the investment in the NoCo B L.P. limited partnership which groups a series of funds managed by Perella Weinberg Partners L.P., in the third quarter of 2010, EXOR S.A. invested $8.2 million (€ 6.1 million) in NoCo B L.P. and € 5 million in the Perella Weinberg Real Estate I fund. Moreover, EXOR S.A. obtained reimbursements from NoCo B L.P. for $1.3 million (€ 0.9 million). At September 30, 2010, the investment commitments in NoCo B and in the Perella Weinberg Real Estate I fund amounted to $38.9 million (€ 28.5 million) and € 17 million, respectively.
As provided in the DLMD debt restructuring agreement, on July 30, 2010, the entire debt payable to EXOR S.p.A. was extinguished against the transfer to EXOR S.p.A. of 790,190 Sequana shares (1.59% of capital stock) owned by DLMD. EXOR S.A. and DLMD now hold, respectively, 28.24% and 20.22% of Sequana’s capital.
Buyback of treasury stock
Under the treasury stock buyback Program approved by the board of directors on May 11, 2010, between July 1, and October 21, 2010, EXOR purchased 865,500 ordinary shares (0.54% of the class) at an average cost per share of € 16.09 and a total of €13.9 million, 1,745,484 preferred shares (2.27% of the class) at an average cost per share of € 11.59 and a total of € 20.2 million and also 135,058 savings shares (1.47% of the class) at an average cost per share of € 12.72 and a total of € 1.7 million. Taking into account this investment of € 35.8 million and those made in the preceding months, EXOR has basically reached the maximum disbursement of € 50 million established by the Program. Currently EXOR holds 4,109,500 ordinary shares (2.56% of the class), 10,239,784 preferred shares (13.33% of the class) and 421,695 savings shares (4.60% of the class).
Considering that all the listed investment holdings have already published their figures for the third quarter of 2010, the following is a brief commentary on the performance of EXOR’s principal unlisted investment holdings: C&W Group, Inc. and Alpitour. The EXOR Interim Financial Report at September 30, 2010, which will be posted on the corporate website www.exor.com, presents the comments on the performance of all the principal subsidiaries and associates.
C&W Group, Inc.
With the third-quarter 2010 performance, the Cushman & Wakefield Group recorded its fourth consecutive quarter of double-digit revenue growth. The Group’s revenue productivity combined with continued discipline on operating expenses resulted in an improvement in the Group profitability.
In the first nine months of 2010, gross revenues of the C&W Group, which include reimbursed managed properties and other costs, increased $150.4 million (+14.7%) to $1,175.2 million, as compared with $1,024.8 million for the first nine months of 2009. Commission and service fee revenues, which excludes reimbursed managed properties and other costs, increased $131.7 million (+16.9%) to $912.8 million in the nine months ended September 30, 2010, as compared with $781.1 million in the first nine months of 2009. C&W Group’s operating loss decreased $82.9 million (-88.4%) to a loss of $10.9 million in the first nine months of 2010, as compared with a loss of $93.8 million in the same period in 2009. The loss attributable to owners of the Parent decreased $60.0 million (-73.0%) to a loss of $22.2 million for the nine months ended September 30, 2010, as compared with $82.2 million in the same period in the prior year. These results led to improved cash flow and debt reduction, as reflected in the Group’s net financial position, which improved by $106.4 million (+41.1%) to a negative $152.3 million as of September 30, 2010, as compared with a negative $258.7 million as of September 30, 2009.
In the third quarter of 2010, gross revenues increased $54.6 million (+14.7%) to $425.5 million, as compared with $370.9 million in the third quarter of 2009. Commission and service fee revenues for the three months ended September 30, 2010 increased $45.0 million (+15.5%) to $334.8 million, as compared with $289.8 million for the same period in the prior year. At the operating income level, C&W Group recorded income of $14.2 million in the third quarter of 2010, as compared with $0.3 million in the third quarter of 2009. The income attributable to owners of the Parent increased $0.8 million to $2.4 million for the three months ended September 30, 2010, as compared with income of $1.6 million in the same period in the prior year.
The tourism sector, in the first nine months of fiscal year 2009/2010, is still suffering from a structural weakness in demand. Except for the positive results of New Year’s, the market trend is generally feeble and demand is down, compared to summer 2009, showcasing an increase in bookings close to the travel dates and a tendency towards low budget priced products, a sign of limited spending capabilities by the customer. Although demand is weak, Alpitour Group’s sales reported an improvement over the same period of the prior year. In fact, consolidated net sales in the first nine months of 2009/2010 increased 13.1% to € 766 million, compared to € 677.4 million in the corresponding period of last year.
The loss from ordinary operations is € 16.5 million against a loss of € 31.7 million reported in the same period of the previous year. Such result for the period was hurt by over € 4 million in customer reprotection costs and the loss of volumes caused by the closing of air space following the eruption of the volcano in Iceland. Without considering such effect, the loss from ordinary operations for the nine months to July 31, 2010 would have shown an improvement of more than € 19 million over the corresponding period of the prior year.
EXOR S.p.A. forecasts a profit for the year 2010.
At the consolidated level, the year 2010 should show a significant improvement in earnings which will largely depend upon the performance of the principal investment holdings.
The manager responsible for preparing the financial reports, Aldo Mazzia, declares, pursuant to article 154 bis,paragraph 2 of the Consolidated Law on Finance, that the accounting information contained in this press release corresponds to the results documented in the accounts, books, and records of the company.