_Sodexo is a société anonyme (a form of limited liability company) domiciled in France, with its headquarters located in Issy-les-Moulineaux.
Sodexo’s consolidated financial statements for the fiscal year ended August 31, 2020 were approved by the Board of Directors on October 28, 2020 and will be submitted to the Annual Shareholders’ Meeting on January 12, 2021.
The numbers shown in the tables were prepared in thousands of euro and are presented in millions of euro (unless otherwise indicated).
The Covid-19 health crisis worsened during the second half, impacting activities in all regions in which the Group is operating. To limit the spread of Covid-19, officially designated as a pandemic by the World Health Organization on March 11, 2020, different measures have gradually been implemented in many countries, requiring site closures and cancellation or postponements of events.
Since the start of the crisis, the Group has implemented a set of actions in order to ensure business continuity and protect its employees and consumers, in compliance with the Group Health and Security policy and in application of the directives and guidelines of health organizations and local authorities. Due to the evolving situation, the Group is closely monitoring the situation and is mobilized to ensure business continuity and results through:
However, the intensification of the Covid-19 health crisis during the second half of Fiscal 2020 has strongly impacted the Group’s financial results and performance. During Fiscal 2020, consolidated revenue was 19,321 million euro, a decrease of 12%(see note 4.1).
With sufficient cash flows provided by operating activities for investments and acquisitions, the Group’s financial situation remains solid. As mentioned in note 1.2 “Financing Operations”, the Group issued two bonds during the second half of Fiscal 2020 for 2.5 billion euro. A portion was used to redeem the full outstanding balance of the U.S. Private Placement, extending the average debt maturity from 5.2 years as of August 31, 2019 to 5.7 years as of August 31, 2020.
In addition, as mentioned in note 12.4.3.1, the Group has access to credit facilities that can be utilized at any time as needed for 1.9 billion euro (the confirmed credit facilities are unutilized as of August 31, 2020). Furthermore, with an operating cash of 3.1 billion euro, the Group has access to 5.1 billion euro of liquidity as of August 31, 2020.
Therefore, as of the date the consolidated financial statements were approved by the Board of Directors, the Group considers there is no risk of going concern.
The Group's activities were strongly impacted by many site closures, a decrease in foot traffic on sites and cancellation or postponement of many events during the second half of Fiscal 2020.
Consequently, the Group performed an in-depth review of the performance of its assets. For those assets where a decline in value was indicated, an impairment test was performed. In addition, the Group has updated the underlying cash flow projection assumptions for all of the segments used for the annual goodwill impairment test. The impairment test methodology is disclosed in note 6 “Goodwill, other intangible and tangible assets”.
The results of the impairment tests performed on this basis led the Group to recognize an impairment charge of 249 million euro in other operating income and expenses in Fiscal 2020, mainly related to the Sports & Leisure and Education segment .
As a continuation of the rigorous measures put in place at the beginning of the pandemic, and in anticipation of the end of government aids in several countries, the Group has decided to proactively take action to reinforce its agility to adapt to the new environment and seize new market opportunities. These measures resulted in the recognition during the second half of restructuring costs of 158 million euro, in addition to the expenses recognized during the first half, the total amount of restructuring and right-sizing costs recognized in Other operating income and expenses was 191 million euro (see. note 4.2.2 “Other operating income and expenses”).
