Verallia expects a significant impact of the Covid-19 crisis on its activities in the second quarter of 2020, resulting in a sizeable drop in sales volumes.

However, the scale and complexity of this unprecedented health crisis, together with the uncertainties associated with the end of such a crisis, have not enabled the group to precisely quantify the impact on customers and its activities for 2020.

In order to address this situation, Verallia is implementing measures to vary costs, to follow very accurately cash and supply chain and proactively manage all investments.

Recurring investments will be maintained at around 8% of annual consolidated revenue, which will be lower than expected, thus leading to an absolute amount of recurring investments lower than forecast.

The building of two strategic investments (construction of a new furnace with two production lines at the Villa Poma site in Italy and at the Azuqueca site in Spain) will be completed by the end of the year and their start-up will take place depending on market needs.

In the first quarter of 2020, Verallia recorded a revenue of €645 million, compared to €633 million in the first quarter of 2019, an increase of 1.9% on a reported basis.

In southern and western Europe, demand levels remained dynamic, particularly for food jars and beer bottles. Italy and Iberia posted positive growth over the quarter.

At the beginning of the quarter, activities in France were affected by national strikes related to pension reform and by a decline in demand from customers exporting to China. This decline became more pronounced from mid-March onwards due to Covid-19 impact.

The northern and eastern Europe region was driven by the food jars and mineral water markets, with Germany, Ukraine and Russia showing positive organic growth. In Latin America, all countries reported positive growth for the quarter, although the situation took a downturn from mid-March, particularly in Brazil.

www.verallia.com