PRIM controls the overall impact of Covid-19 in 2020 and reaches revenues of over €147 million, in line with the previous year

The Prim Group closed the 2020 financial year with a turnover of €147.3 million (-2.43%), very much in line with the €150.9 million seen the previous year and above the revised forecast made as a result of Covid-19, with the pandemic having a unique impact on the income statement for the second quarter.

During the final six months of the year, the Company recovered its growth with significant increases in its revenues, EBITDA and operating profit, compared to the setbacks experienced in the second quarter of the year, which was hit hardest by Covid-19. At the end of the year, the Group’s operating profit stood at €13.9 million, while EBITDA reached €19.8 million, representing a limited reduction of 8.54% and 1.56% respectively, compared to the decreases of 31.7% and 30.1% seen at the end of the first half of the year.

Net profit amounted to €6.9 million, a reduction of 38% compared to 2019. This profit was affected by the inclusion of a €6 million financial expense corresponding to specific currency hedging values with said hedging values not being accounted at the time, meaning they were recorded at the market value as of 31 December 2020. Throughout the 2021 financial year, this expense may be offset by the variation of the market value of these hedging values and the use of these for the purchase of inventories in dollars. Without this accounting factor, net profit would have fallen by only 11% in a year that was severely affected by the pandemic, which Prim has managed to control in terms of revenues, EBITDA and the profit from its regular activities.

Following the declaration of the State of Alarm, any hospital activity not related to Covid essentially came to a pause which affected the entire sector. However, certain strategic decisions adopted by the Company meant that there was a recovery in its commercial activity from May and June onwards, with improved revenues and profits.

These decisions were related to the strengthening of the company’s financial position and not furloughing the workforce, which meant that any commercial actions could be quickly implemented following the lifting of the State of Alarm. Along with these measures, good risk management and payment collections, together with a reduction of investments that were not related to digitalisation or the upgrading of equipment have all resulted in a strong adaptation to the situation caused by the pandemic.

In the Management Report for the second half of the year, approved by the Board of Directors, the company acknowledges that there are still uncertainties regarding the evolution of the virus and its effect on society, the country’s economy and the Group’s businesses. However, it stresses that in the medium and long term the pandemic should not have a significant impact on the Company’s future economic projections once the national economy has fully recovered.

With this in mind, Prim will stick to its multi-year Strategic Plan, and it considers that its wide variety of products, sales channels and markets in which it has a presence mean that, in addition to financial strength, it holds a favourable position over its competitors to better weather the crisis and to take advantage of existing growth opportunities.

The aforementioned half-yearly report includes the measures that the Company has implemented to combat the negative effects of COVID-19 and to protect its stakeholders, employees, customers, suppliers, subcontractors and society as a whole.

These actions include the strengthening of its cash reserves, the financial support offered to private customers and suppliers to help with the continuity of their services, job protection, and its participation in the corporate solidarity chain that has been implemented in Spain with the donation of equipment and the provision of both facilities and qualified technical and human resources to hospitals.

These actions have not had a negative impact on the Group’s financial situation, nor have they damaged its intangible assets. In a year severely affected by the Covid-19 crisis, Prim has managed to increase its financial solvency, improve its liquidity, avoid staff layoffs and distribute dividends amounting to €0.44 gross per share, of which €0.11 corresponds to the interim dividend for the 2020 financial year.

During the second half of 2020, there was also a generational change of the chairmanship and the succession plan for the management structures was implemented. This resulted in the appointment of a managing director with extensive international experience and an in-depth knowledge of the sector in the shape of Fernando Oliveros.

Following the closing of the financial year, and as a sign of its financial strength and confidence in an overall recovery, Prim approved the implementation of a buy-back programme of treasury shares amounting to €3 million for subsequent amortisation.

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