The Annual General Meeting of Valora Holding AG approves all proposals by the Board of Directors

At the Annual General Meeting (AGM) of Valora Holding AG in Basel today, the shareholders expressed their trust in the Board of Directors and Group Executive Management. The Annual General Meeting was held without the attendance in person of shareholders in accordance with Art. 6b of the “Ordinance 2 on the measures for combating the coronavirus (COVID-19)” (“Verordnung 2 über die Massnahmen zur Bekämpfung des Coronavirus (COVID-19)”) issued by the Federal Council (COVID-19 Ordinance 2). Shareholders were able to exercise their rights exclusively via the independent proxy. It represented 2,011,610 votes at the Annual General Meeting of Valora Holding AG.

All of the proposals made by the Board of Directors were accepted. The most important decisions related to the following:

The 2019 financial statements were approved. Moreover, the Annual General Meeting agreed to a waiver of the dividend for the 2019 financial year in view of the developments related to the coronavirus and therefore to carry forward the 2019 net profit. The shareholders thus support a prudent approach to the company's financial resources in the interests of Valora and all its stakeholders.

The Annual General Meeting also approved the renewal of the authorised capital of CHF 400,000.00 for a further two years. This will continue to enable Valora to quickly take advantage of investment and acquisition opportunities or to carry out capital increases to further optimise the capital structure. The proposed conditional capital increase was also approved. The additional conditional capital in the amount of CHF 400,000.00 will further increase the financial flexibility of the company and its Group companies. The conditional capital allows Valora to issue financial market instruments such as convertible bonds, thereby benefiting from attractive options to procure capital on the market.

The Annual General Meeting further approved the 2019 Remuneration Report in a consultative vote. In a binding vote, it also approved the total maximum remuneration for the Board of Directors for the period of office from the 2020 AGM until the 2021 AGM and for the members of Group Executive Management for the 2021 financial year.

All members of the Board of Directors standing for re-election were confirmed in their office: Franz Julen, Insa Klasing, Michael Kliger and Sascha Zahnd. Moreover, Franz Julen was re-elected as the Chairman of the Board of Directors. Markus Fiechter, Peter Ditsch and Cornelia Ritz Bossicard did not stand for re-election. Markus Bernhard, Dr Karin Schwab and Dr Suzanne Thoma were elected in their place as new members of the Board of Directors. Dr Suzanne Thoma will join the Nomination and Compensation Committee in addition to the current members Insa Klasing and Michael Kliger.

Franz Julen, Chairman of the Board of Directors, says: “I would like to thank the Annual General Meeting on behalf of the Board of Directors for their confidence in us and the support during what is a challenging time for everyone in view of the coronavirus. The Board of Directors is convinced that the waiver of the dividend in combination with the measures initiated at an operational level is compatible with and important to the company's long-term success. Our goal is to preserve the company's financial stability over the long term in order to quickly regain our old strength after the crisis together with our customers, employees, partners and shareholders. We have prepared ourselves for a process that will challenge us throughout 2020.”

The coronavirus crisis continues to put strain on business

The dynamic of developments associated with the coronavirus continues to significantly impact business performance at Valora Group. Following the incremental easing of the official orders to contain the virus, the foodvenience provider is now allowed to operate all its sales outlets. The official orders, however, have led to a sustained decline in customer frequency and revenue. As a result, just under 50% of the over 2,700 sales outlets currently have in some cases significantly reduced opening hours and about 5% remain closed for the time being. Orders in the B2B pretzel business remain subdued due to the sustained low demand in the out-of-home market, although they are recovering slowly.

Developments over the past few weeks thus continue to have a major impact on revenues, although slightly positive tendencies are now in evidence. While the retail network in the affected markets posted a fall in same-store revenue of around 20% in April over the previous year, it was about 10% in May. The decline in the food service network in May was about 60%, compared to about 70% in April. Sales for the B2B business were 60% down also in May compared to the previous year. The way in which this development will change in future still depends on how and when the easing of the respective lockdowns decreed by the various national authorities will impact customer frequency and on whether and how quickly customers' purchasing behaviour returns to normal.

Numerous measures implemented to reduce costs and secure liquidity

As communicated, the Executive Management of the Valora Group has implemented numerous measures to reduce the cost base and to proactively safeguard liquidity. These measures include suspending all investments in expansion and conversions and the agreement with key lessors to defer rental payments. Some rent reductions during the lockdown were also agreed. Furthermore, slightly more than half of the Valora employees are now on short-time working. Having covered the salary shortfalls from short-time working to 100% until the end of April and to 90% in May, Valora will no longer offer this compensation in June and July. This does not apply to Germany, where Valora will continue to compensate the proportionally higher lost earnings to 80% in June and July. Valora is developing solutions with its agency and franchise partners to secure economic viability for these self-employed entrepreneurs and their staff.

It is still too early to make reliable forecasts about future revenue and earnings development. However, Valora expects a pronounced negative effect on EBIT and net profit both for the first half-year and full-year 2020. The negative effects on free cash flow can most likely be largely offset by the investment stops and by waiving the dividend, meaning that net debt at year-end is expected to only increase slightly.