While contract-linked capex in some segments was difficult to stop and IT spend was maintained in line with the plan, the capex to sales ratio was up +20 bps in Business & Administrations at 1.6% and +10 bps in Healthcare at 0.8%, and down -130 bps in Education at 1%. Capex to sales was 9.1% in Benefi ts & Rewards as investments were maintained. As previously announced, this rate is expected to increase over the next few years to around 2.5%, as retention and development improve in Education and Sports & Leisure, the two biggest segments in terms of capex, and spend progresses on the new food model.
Free cash flow for the full year reached 72 million euro, with the second half inflow more than covering the first half outflow.
Having paused all M&A activity from March due to the Covid-19 crisis, net acquisitions and disposals of subsidiaries was negligible for the year.
The dividend payment of 425 million euro, approved by the Annual General Meeting on January 21, 2020 and paid on February 3, 2020, well before the Covid-19 crisis arrived, reflected the +5.5% increase in the dividend per share.
After taking into account Other changes, principally linked to currency impacts and consolidation scope changes, consolidated net debt increased during the year by 655 million euro to 1,868 million euro at August 31, 2020.
Fiscal 2020 was a year of integration for the large number of acquisitions signed in 2019. However, from the onset of the pandemic, M&A activity was put on pause in order to protect the financial structure of the Group. Some investments were nevertheless signed during the period reflecting the need to invest in the evolving food model.
| (in millions of euro) | AUGUST 31, 2020
|
AUGUST 31, 2019
|
|
(in millions of euro) | AUGUST 31, 2020
|
AUGUST 31, 2019
|
|---|---|---|---|---|---|---|
|
Non-current assets |
Non-current assets AUGUST 31, 2020 9,730 |
Non-current assets AUGUST 31, 2019 9,455 |
Non-current assets
|
Shareholders’ equity
|
Non-current assets (in millions of euro)2,758 |
Non-current assets AUGUST 31, 2020 4,456 |
| Current assets excluding cash
|
Current assets excluding cash AUGUST 31, 2020 4,493 |
Current assets excluding cash AUGUST 31, 2019 5,111 |
Current assets excluding cash
|
Non-controlling interests
|
Current assets excluding cash (in millions of euro) 15 |
Current assets excluding cash AUGUST 31, 2020 42 |
| Restricted cash Benefits & Rewards
|
Restricted cash Benefits & Rewards AUGUST 31, 2020 770 |
Restricted cash Benefits & Rewards AUGUST 31, 2019 678 |
Restricted cash Benefits & Rewards
|
Non-current liabilities
|
Restricted cash Benefits & Rewards (in millions of euro) 6,834 |
Restricted cash Benefits & Rewards AUGUST 31, 2020 4,722 |
| Financial assets Benefits & Rewards
|
Financial assets Benefits & Rewards AUGUST 31, 2020 333 |
Financial assets Benefits & Rewards AUGUST 31, 2019 442 |
Financial assets Benefits & Rewards
|
Current liabilities
|
Financial assets Benefits & Rewards (in millions of euro) 7,745 |
Financial assets Benefits & Rewards AUGUST 31, 2020 8,247 |
| Cash
|
Cash AUGUST 31, 2020 2,027 |
Cash AUGUST 31, 2019 1,781 |
Cash
|
Cash (in millions of euro)
|
Cash AUGUST 31, 2020
|
Cash AUGUST 31, 2019
|
| TOTAL ASSETS |
TOTAL ASSETS AUGUST 31, 2020 17,353 |
TOTAL ASSETS AUGUST 31, 2019 17,467 |
TOTAL ASSETS
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
TOTAL ASSETS (in millions of euro) 17,353 |
TOTAL ASSETS AUGUST 31, 2020 17,467 |
| Gross debt AUGUST 31, 2020
|
Gross debt AUGUST 31, 2019
|
Gross debt |
Gross debt
4,992 |
Gross debt (in millions of euro) 4,079 |
||
| Net debt AUGUST 31, 2020
|
Net debt |
Net debt AUGUST 31, 2019 1,868 |
Net debt
1,213 |
|||
| Gearing AUGUST 31, 2020
|
Gearing |
Gearing AUGUST 31, 2019 67 % |
Gearing
27 % |
|||
| Net debt ratio AUGUST 31, 2020
|
Net debt ratio |
Net debt ratio AUGUST 31, 2019 2,1 |
Net debt ratio
0,8 |
|||
The decrease in shareholders’ equity was due to several factors: the currency translation adjustment due to the weakness of some currencies such as the U.S. dollar and the Brazilian real, the revaluation of some fi nancial assets under IFRS 9, the fi rst time adoption of IFRIC 23, the reported net loss and the payment of the Fiscal 2019 dividend.
As of August 31, 2020, net debt was 1,868 million euro, representing a gearing of 67%, and a net debt ratio of 2.1. This compares to 50% and 1.3 respectively as at February 29, 2020 and 27% and 0.8 as of August 31, 2019.
As soon as the Covid-19 crisis emerged in Europe, cash was very strictly controlled, second half investments were pushed back and means to increase liquidity were identified. In April, the Group issued 1.5 billion euro of bonds at an average rate of just below 1% and a maturity split in two tranches, of which 700 million euro maturing in April 2025 and 800 million euro in April 2029.
Given the extent of the crisis, and in order to maintain its independence of action, Sodexo decided in June to reimburse the USPP of 1.4 billion euro, thus resolving the issue of the covenant thresholds which were limiting the Group’s capacity to restructure and continue to invest in the future. As a result, the Group has no more covenants on its debt. To maintain a high level of liquidity, a further 1 billion euro was raised in the bond market in July at an average rate of less than 0.8%, maturing half and half in January 2024 and July 2028.
As at the end of Fiscal 2020, Operating cash totaled 3,124 million euro, including 770 million euro of restricted cash and 333 million euro of financial assets of Benefits & Rewards Services and net of overdraft s of 6 million euro. The share of operating cash related to Benefi ts & Rewards Services is 2,082 million euro. With this operating cash and client receivables of 1,274 million euro, compared to voucher liabilities
