Operating net income SnowWorld 1 st six months increase to 4.0 million

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1 Press release 28 May 2014 Expected increase operating net income for the financial year 2013/2014 Operating net income SnowWorld 1 st six months increase to 4.0 million Keypoints - The number of ski passes sold first six months (October 2013 March 2014) increased by 2% - Net sales first six months 18.4 million and gross margin 16.6 million - Increase of the net operating income by to 4.0 million - Strong balance improvement; group equity increases with 150% - Guarantee capital increased to 24.4% - Expectation for the financial year 2013/2014: higher operating net income Successful 1 st half-year SnowWorld has had a successful 1 st half-year. Ski pass sales increased by 2% in the first six months of the financial year (1 October March 2014). Despite slightly higher operating expenses related to the stock exchange listing, operating net income increased by 4% to 4.0 million. For SnowWorld, the first six months of the financial year are by far the most important of the year. SnowWorld generates over 70% of its annual turnover in the first six months of the year. The performance for this period therefore lays a very strong foundation for the results for the full financial year. 1 st six months: EBITDA 8.3 million At 18.4 million, net sales for the first half-year increased marginally compared to the first six months of last year. Gross profit increased marginally too, by 0.5%, to 16.3 million. The increase in operating gross profit was mainly caused by a higher margin on the ski activities. The number of ski passes sold increased by 2%. Partly because of the listing of SnowWorld, operating expenses increased slightly, causing the operating EBITDA for the first half-year to decrease by 2% to 8.3 million, compared to that in the first six months of the previous year. EBIT increased with 3%. Strong balance improvement The reverse takeover and the proceeds from the issuance of new shares, after deducting one-off costs for these two transactions, and the result achieved in the first six months led to SnowWorld being able to strengthen its equity to 10 million. Which results in an increase of group equity with more than 150%. Partly because of this, the guarantee capital increased by 31 March 2014 to 24.4%, where the interest-bearing debt decreased by 8.3 million to 36.9 million. Prospects: higher net operating income for the financial year 2013/2014 In the context of its growth strategy, SnowWorld took further steps in the development of the proposed new branches in Paris and Barcelona, and the extension of the third slope in Zoetermeer. The zoning plan procedures have been put in motion for all three projects. SnowWorld expects to see a higher operating net income for the full financial year compared to last year. In this prospect one-offs related to the listing are not taken into account.

2 For more information on this press release or additional information, please contact: Koos Hendriks (CEO), +31 (0) or Wim Moerman (CFO), +31 (0) or SnowWorld Profile SnowWorld N.V. is a listed company based in Zoetermeer. With its two indoor ski facilities in the Netherlands, SnowWorld is one of the world s leading companies in this sector. Since its establishment in 1996 by Mr J.H.M. Hendriks, SnowWorld has experienced rapid growth. In connection with SnowWorld s strategy of further rolling out its proven, successful concept in Europe, SnowWorld went public in

3 Key points 1 st six months (1 October 2013 to 31 March 2014) General - SnowWorld was listed through a reverse takeover as of 10 December Issue of new shares on 19 February 2014 to the sum of 6 million - Collapse of previously announced takeover of SnowPlanet in Spaarnwoude - Further development new construction projects Financial - The number of ski passes sold increased by 2% - Net sales ( 18.4 million) and gross margin ( 16.6 million) for the first six months are almost identical to the first six months of the previous financial year - Partly because of higher operating expenses related to stock exchange listing, operating EBITDA decreased by 2% to 8.3 million - Increase of the net operating income by 4% to 4.0 million - Net non-recurring charge related to reverse takeover and issuance of 1.9 million ( 0.3 million cash out). Of this, 1.3 million was charged to the result for the current financial year - Guarantee capital increased to 24.4% - Interest-bearing debt decreased by 8.3 million to 36.9 million Overall development With its two indoor ski facilities in the Netherlands, SnowWorld is one of the world s leading companies in this sector. Since its establishment in 1996 by Mr J.H.M. Hendriks, SnowWorld has experienced rapid growth. SnowWorld has concrete plans to continue this growth in the coming years as well. The company s growth strategy is based on three cornerstones, namely: - Development of existing activities - New developments - Acquisition and consultancy activities In response to the possible funding of its growth strategy, SnowWorld acquired access to capital markets in the past six months. As a result of the reverse takeover of Fornix Biosciences N.V., SnowWorld has been listed on the Amsterdam Stock Exchange since 10 December To improve its balance sheet ratios, SnowWorld then issued new shares on 19 February 2014, to the sum of 6 million. This further strengthened the company s equity capital. SnowWorld is working with its team of consultants to further the development of its new construction projects. On 16 December 2013, the Zoetermeer municipal council approved the further development of SnowWorld s plan to extend its third ski slope in Zoetermeer to 300 meters. To this end, the preliminary draft zoning plan and building permit are currently being elaborated. The procedures for adopting these will be established in the coming months. Procedures for changing the zoning plans for the proposed two new SnowWorld branches in Paris and Barcelona are currently underway. SnowWorld expects to be able to apply for the building permits for both projects this year still. The architects are working in close consultation with SnowWorld on the development of both concepts. SnowWorld is regularly offered indoor ski resorts in Europe to take over. Each time, SnowWorld looks whether the ski resort could fit in the SnowWorld concept and whether it could be profitable for the group. During the past six months, SnowWorld examined the potential acquisition of SnowPlanet in Spaarnwoude. Based on this study, 3

4 SnowWorld concluded, among other things, that the acquisition wouldn t deliver the intended contribution to shareholder value, which is why SnowWorld decided against it. Financial development Financial business 1 st six months Result 1 st six months The consolidated results for the first half-year were as follows: (in thousands of Euros) result operating result 1 st half-year listing 1 st half-year 1 st half-year /2014 expenses 2013/ /2013 Net sales 18,435-18,435 18,370 Gross profit 16,262-16,262 16,188 EBITDA 6,874 1,416 8,290 8,450 Income from operations (EBIT) 5,125 1,416 6,541 6,353 Net income 2,665 1,349 4,014 3,854 For SnowWorld, the first six months of the financial year are by far the most important of the year. SnowWorld generates over 70% of its annual turnover in the first six months of the year. The performance for this period therefore lays a very strong foundation for the results for the full financial year. Application of the International Financial Reporting Standards has resulted in a cost item for the reverse takeover and issuance of the newly issued shares (above-mentioned listing expenses ) of 1.9 million. Of this, 1.3 million was allocated to the result; the remainder being deducted from the issue proceeds as direct change in equity. Of these total costs, 0.3 million is an actual cash outflow. At 18.4 million, net sales for the first half-year increased marginally compared to the first six months of last year. Gross profit increased marginally too, by 0.5%, to 16.3 million. The increase in operating gross profit was mainly caused by a higher margin on the ski activities. The number of ski passes sold increased by almost 2%, despite a weak start to the financial year. Gross profit on catering activities was slightly lower. This is partly related to the catering turnover related to the RED BULL Crashed Ice event in Landgraaf last year. 1 The comparative figures relate to consolidated figures of SnowWorld Leisure N.V. 4

5 Especially in Zoetermeer, fitness and wellness activities contributed particularly poorly to the result. Due to the higher gross profit on the ski and catering activities, gross profit increased by 2.2% in Zoetermeer. (in thousands of Euros) 1 st half-year 2013/ st half-year 2012/2013 difference net cost of gross net cost of gross gross sales sales profit sales sales profit profit Skiing 11, ,735 10, , % Catering 4,939 1,578 3,361 5,060 1,566 3, % Fitness % Hotels % Outdoor % Other % 18,435 2,173 16,262 18,370 2,182 16, % Zoetermeer 7, ,462 7, , % Landgraaf 11,017 1,217 9,800 11,103 1,234 9, % 18,435 2,173 16,262 18,370 2,182 16, % Because of lower income from sponsors this half-year, the total gross margin was slightly lower than last year. Partly because of the listing of SnowWorld, operating expenses increased slightly, causing the operating EBITDA for the first half-year to decrease by 2% to 8.3 million, compared to that in the first six months of the previous year. Due to lower depreciation and interest charges, the net operating income increased by 4% in the first half year to 4.0 million. 5

6 Balance sheet as at 31 March 2014 The consolidated balance sheet at the end of March 2014 is as follows: (in thousands of Euros) 31 March 30 September Intangible assets 1,044 1,044 Property, plant and equipment 54,189 55,109 Financial assets Working capital -4,592-3,150 50,747 53,052 Long-term debt -40,967-49,199 Shareholders short-term receivables Current account bank / Cash and cash equivalents Group equity 9,955 3,913 As of 30 September 2013, the SnowWorld group consisted of SnowWorld Leisure N.V. and its wholly owned subsidiary SnowWorld International B.V. As a result of the reverse takeover on 10 December 2013, the SnowWorld group was extended to also include SnowWorld N.V. (formerly Fornix Biosciences NV) from that date. The consolidated balance sheet as of 31 March 2014 therefore also includes SnowWorld N.V. with its wholly owned participating interests SnowWorld Leisure N.V. and SnowWorld International B.V. The financial statements of SnowWorld Leisure N.V. as at 30 September 2013 have been prepared based on the statutory provisions of Title 9 of Book 2 of the Dutch Civil Code. In connection with the listing obtained by the reverse takeover, SnowWorld will be preparing its financial statements with effect from the financial year 2013/2014 in accordance with the International Financial Reporting Standards, as adopted for use in the European Union (EU- IFRS). The comparative figures in this press release were prepared based on these IFRS principles. These are derived from the prospectus dated 21 January 2014, which is available from the SnowWorld website. Solvency By adding the result to the reserves, the issue of 753,255 shares at an issue price of 8.0 per share on 19 February 2014, and the processing of the reverse takeover, shareholders equity increased from 3.9 million at 30 September 2013 to 10.0 million as at 31 March The solvency thus increased from 6.7% at 30 September 2013 to 17.2% at 31 March Taking into account the subordinated debt of former shareholders, the guarantee capital rose from 7.8% to 24.4%. It should be noted that the tangible fixed assets, mainly building and land, are valued at cost price, less straight-line depreciation. Solvency therefore takes no account of any hidden reserves, which are included in this valuation. 2 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 6

7 Working capital Working capital was significantly higher at the end of March 2014 (at the end of SnowWorld s high season) than at 30 September This is a normal seasonal pattern. Interest-bearing debt The reverse takeover, the issue of new shares, and the operating cash flow achieved over the past six months have caused the interest-bearing debt to decrease by 8.3 million from 45.3 million to 36.9 million. The interest-bearing debt is made up as follows: (in thousands of Euros) 31 March 30 September Long-term debt 40,967 49,199 Shareholders short-term receivables Current account bank / Cash and cash equivalents ,792 49,139 Less: interest rate swap liability -3,867-3,865 36,925 45,274 The share Until 10 December 2013, Fornix Biosciences N.V. had 8,047,688 shares with a nominal value of 0.15 in issue. Through a reverse split on 10 December 2013, this was reduced by a factor of 25 and became 321,908 shares with a nominal value of Through the issuance of 1,875,000 shares in connection with the reverse takeover of SnowWorld on 10 December 2013, and the share issue on 19 February 2014 (753,255), the number of shares outstanding as at 31 March 2014 was 2,950,163. Prior to the announcement of the reverse takeover by SnowWorld, the share price of Fornix Biosciences N.V. (adjusted for the reverse share split) amounted to 8 per share. This rate was also used by SnowWorld as issue price, both for the shares issued in connection with the reverse takeover and for the shares issued in the offering of 19 February On Monday, 31 March 2014, the closing price was Current major shareholders in the share capital of SnowWorld are J.H.M. Hendriks Beheermaatschappij B.V. with 68%, Value8 N.V. with 14%, and Mr J.P. Visser with 3.0%. Prospects SnowWorld s performance in the first six months lays a solid foundation for its results for the full financial year. After all, more than 70% of the annual turnover is achieved in this part of the financial year. The second half of SnowWorld s financial year is traditionally loss making. Based on its normal operations, SnowWorld expects an EBITDA similar to last year s ( 8.4 million) for the full financial year. While the snow conditions in the Alps over the coming months will have an important effect on the number of athletes that will come to train in Landgraaf this summer, the impact of this on the annual result will be 3 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 7

8 relatively limited. Because of the lower depreciation and interest expenses, the net income from operating activities is expected to finish higher than last year (at 1.7 million). In the short to medium term, SnowWorld expects to benefit from an improving economy and associated increasing consumer confidence. SnowWorld has agreed ratios with ABN AMRO Bank, at the level of SnowWorld Leisure N.V., within which use of the facility should remain. SnowWorld expects to be able to meet this as of 30 September Together with its advisers, SnowWorld will use the coming months to further develop its plans relating to its new developments. SnowWorld is also exploring the possibilities of funding said new developments. Before any funding for this is taken out, it will be submitted to the General Meeting of Shareholders. The development and financing of the projects is based on the principles that it should contribute to higher earnings per share and that any dilution from the issuance of new shares must be minimised. Board statement The financial statements included in this press release represent a true and fair view of the assets, liabilities, financial position and profit or loss for the period 1 October 2013 to 31 March 2014 of SnowWorld N.V. and the undertakings included in the consolidation taken as a whole. In so doing, the press release gives a true and fair view of the major events that have occurred over the period of 1 October 2013 to 31 March 2014 and their effect on the financial statements included in the press release, and a description of the principal risks and uncertainties in the remaining six months of the financial year and of the most important transactions with related parties. For more information on this press release or additional information, please contact: Koos Hendriks (CEO), +31 (0) or corporate@snowworld.com Wim Moerman (CFO), +31 (0) or corporate@snowworld.com SnowWorld Profile SnowWorld N.V. is a listed company based in Zoetermeer. With its two indoor ski facilities in the Netherlands, SnowWorld is one of the world s leading companies in this sector. Since its establishment in 1996 by Mr J.H.M. Hendriks, SnowWorld has experienced rapid growth. In connection with SnowWorld s strategy of further rolling out its proven, successful concept in Europe, SnowWorld went public in

9 CONSOLIDATED BALANCE SHEET (before appropriation of results) A s s e t s (in thousands of Euros) 31 March September Non-current assets Intangible assets 1,044 1,044 Property, plant and equipment Land and buildings 50,107 51,231 Machinery and installations Other equipment 2,505 2,415 Prepayment and construction in progress 1,407 1,242 54,189 55,109 Financial assets Current assets Inventories Receivables Accounts receivable Shareholders short term receivables Taxes and social security receivable Other current and accrued receivables , Cash and cash equivalents Total assets 57,954 57,867 Unaudited 4 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 9

10 E q u i t y a n d l i a b i l i t i e s (in thousands of Euros) 31 March September Group equity (1) 9,955 3,913 Long term provisions Deferred tax liabilities - - Long-term debts Long-term debt from credit institutions 36,478 43,152 Shareholders loan 3, Other long-term debt ,850 44,530 Current liabilities Current portion of long term debt 117 4,669 Short-term debt from credit institutions Trade creditors 1,486 1,627 Shareholders current liabilities - - Taxes and social security payable 1, Other current and accrued liabilities 3,115 2,376 7,149 9,424 Total equity and liabilities 57,954 57,867 Unaudited 5 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 10

11 CONSOLIDATED STATEMENTS OF INCOME (in thousands of Euros) 1 st half-year 2013/ st half-year 2012/ Net sales 18,435 18,370 Cost of sales -2,173-2,182 Gross profit 16,262 16,188 Other operating income Gross margin 16,643 16,689 Wages and salaries 3,983 3,942 Social securities Depreciation and amortisation expenses 1,749 2,097 Other operating expenses 5,192 3,668 Total operating expenses 11,518 10,336 Income from operations 5,125 6,353 Financial income and expenses -1,176-1,215 Income before taxes 3,949 5,138 Income tax expense -1,284-1,284 Net income 2,665 3,854 Unaudited 6 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 11

12 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands of Euros) 1 st half-year 2013/ st half-year 2012/ Net income 2,665 3,854 Increase/decrease interest rate swap Total of direct changes in equity Total comprehensive income 2,663 4,700 Unaudited 7 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 12

13 CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of Euros) 1 st half-year 2013/ st half-year 2012/ Cash flows from operating activities Income from operations 5,125 6,353 Adjusted for: Depreciation and amortisation 1,749 2,097 Increase/decrease deferred taxes (excl. interest rate swap) Cost reverse acquisition (non cash items) 1,201 - Increase/decrease in working-capital: Increase/decrease in inventories Increase in receivables Increase/decrease current liabilities (excluding credit institutions) Cash generated from operations 8,308 8,583 Finance expenses -1,176-1,215 Paid income tax ,490-1,252 Net cash provided by operating activities 6,818 7,361 Cash flows from investing activities Purchase of intangible assets - - Sale/purchase of property, plant and equipment Net cash used for investing activities Cash flows from financing activities Income from shares issued 5,946 - Reverse takeover 1,232 - Vendor loan -5,000 - Increase long-term debts (excl. interest rate swap) -8,234-2,850 Net cash used for financing activities -6,056-2,850 Net increase/decrease in cash and cash equivalents -67 3,885 Unaudited 8 The comparative figures relate to the consolidated figures of SnowWorld Leisure N.V. 13

14 Group equity (1) The conduct of the individual items in the group equity is as follows: (in thousands of Euros) - Total Share Premium Revaluation Other Result for group capital reserve reserve reserve the period equity Balance as of 1 October ,523 10,034-2,899-10,455 1,710 3,913 Results for the period ,665 2,665 Results previous period ,710-1,710 - Reverse takeover ,474-2,474 Vendor loan , ,000 Income from share issue 2,825 3, ,026 Cost share issue Reconciliation share capital 2, , Cost stock options Increase revaluation interest rate swap Balance as of 31 March ,063 12,694-2,901-13,566 2,665 9,955 Unaudited 14