Intertrust launches EUR 500 million senior unsecured notes offering

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Overig advies 05/11/2018 10:54
Amsterdam, the Netherlands - 5 November 2018 - Intertrust N.V. ("Intertrust" or "Company") [Euronext: INTER], a leading global provider of expert administrative services to clients operating and investing in the international business environment, announces the launch today of an offering (the "Offering") of senior unsecured notes (the "Notes") by its subsidiary Intertrust Group B.V. (the "Issuer").

The Issuer intends to use the proceeds from the Offering, if completed, together with borrowings under a new facilities agreement, for the refinancing of its current debt facilities and to pay costs, fees and expenses incurred in connection with this transaction. The new facilities agreement includes a USD 200 million term loan facility, GBP 100 million term loan facility and multicurrency revolving credit facility of EUR 150 million. The new facilities agreement is contingent upon successful completion of the Offering.

Application has been made for the Notes to be listed on the Official List of the Luxembourg Stock Exchange and to trading on the Euro MTF market of the Luxembourg Stock Exchange.

In relation to the launch of the Offering, Intertrust has prepared 9M 2018 interim statements which are available on our website.

Interim Management Board report
Intertrust N.V. (the "Company") and its subsidiaries (together referred to as the "Group") is a leading global provider of expert administrative services to clients operating and investing in the international business environment. The Company has approximately 2,500 FTEs working in its offices across all continents.
Full year 2018 outlook
Intertrust management confirms its outlook for the full year 2018:
• Underlying revenue growth of at least 3% year-on-year.
• Adjusted EBITA margin of at least 37%.
• Capex around 2% of revenue.
• EffectLve tax rate of approximately 18%.
• Dividend policy 40-50% of adjusted net income.

Medium term guidance
At Capital Markets Day (20 September 2018) we have presented the following medium term guidance:
• Underlying revenue growth of 3 - 5% year-on-year.
• Adjusted EBITA margin growing to more than 38% by 2021, from at least 36% in 2019, reflectLnJ three near-term
- Investment in cost efficLenc\ measures
- Investment in business development and new solutions
- Mix impact from slower growth in the Netherlands and higher growth in ROW.
• Capex expected to be around 2% of revenue.
• EffectLve tax rate of around 19%.
• Dividend policy at least 40% of adjusted net income.
• Target leverage of around 3.0x.
Financial review for the nine-month period ended 30 September 2018
In the first nine months of 2018, the Group generated revenue of EUR 363.4 million, which is EUR 5.6 million higher compared with EUR 357.8 million in the same period of 2017, or 3.6% on an underlying basis. Adjusted EBITA margin was 37.4% for the first nine months of 2018, compared to 37.5% adjusted EBITA margin for the same period in 2017.

The revenue growth was mainly driven by Luxembourg and Rest of the World. On an underlying basis, revenue in the first nine month of 2018 was more or less stable year-on-year in the Netherlands, Jersey and Americas. The impact of exchange rate variances, mostly arising from USD exchange rate fluctuatLon, resulted in 3.6% higher revenue in EUR compared to the same period last year.

Staff expenses
Salaries and wages increased by EUR 4.1 million year-on-year to EUR 164.6 million for the first nine months ending 30 September 2018. On an underlying basis, staff expenses increased by EUR 5.2 million or 3.3%. The increase is largely driven by increased headcount.

Rental and other operating expenses
Rental and operating expenses remained stable year-on-year.

Depreciation and amortisation
Depreciation and amortisation charges remained fairly constant at EUR 39.1 million for the first nine months of 2018,
consisting of amortisation of brand and customer relationship of EUR 30.8 million, software and other intangible amortisation of EUR 4.3 million and depreciation of EUR 4.0 million.

Operating result
Driven by higher sales and slightly lower costs, the 3rofit from operating activities in the first nine months of 2018 decreased
by EUR 0.2 million, or -0.2%, to EUR 94.6 million.

Financial result
The financLal result decreased by EUR 3.2 million year-on-year, to EUR 21.4 million negative for the first nine months of 2018 from EUR 18.2 million negative. This decrease is mainly due to a foreign exchange gain offset in the first nine month
of 2017 resulting from intercompany loans. Most of the intercompany currency exposures were eliminated towards the end of 2017 resulting in a sLJnLficantl\ lower revaluation result.
The breakdown of the financLal result of EUR 21.4 million negative (EUR 18.2 million negaitve for the nine months ended
30 September 2017) was as follows:
• Bank interest of EUR 17.9 million (2017: EUR 17.1 million);
• Amortisation of financLnJ fees EUR 2.7 million (2017: EUR 3.4 million);
• Net foreign exchange losses of EUR 0.1 million (2017 net foreign exchange gains of EUR 2.6 million);
• Net change in fair value of derivatives of EUR 0.2 million loss (2017: EUR 0.3 million gain);
• Other costs of EUR 0.5 million (2017: EUR 0.6 million).

Income taxes
The income tax expense decreased by EUR 4.5 million to EUR 13.2 million, resulting in an effectLve tax rate of 18.0% (the first nine months of 2017: 23.1%). In the first nine months ended 30 September 2017 tax expenses included one-off income tax expenses, amongs others, of EUR 5.4 million related to pre-IPO period (2012-2015). Eliminating those items the effectLve tax rate in the first nine months of 2017 was similar to the same period in 2018.

Cash flow
In the first nine months of 2018, operating cash flow increased by EUR 6.9 million, or 6.4% compared to the same period of
2017. Main increase relates to higher cash collection from accounts receivable. Cash used in investing activities decreased
from EUR 12.1 million in the first nine month of 2017 to EUR 9.3 million in the same period in 2018 driven by lower capex
as well as lower cash spent on acquisitions. Cash flow used in financLnJ activities of EUR 85.2 million comprises mainly of
the purchase of treasury shares amounting to EUR 37.0 million, interest and other finance expenses of EUR 18.6 million and
dividend paid in June 2018 amounting to EUR 29.4 million.

Share cancellation
As of 25 September 2018 the number of outstanding shares amounted to 89,755,202 shares following the cancellation of 2,244,190 shares. This has resulted in EUR 1.3 million decrease in share capital and EUR 34.5 million in retained earnings
compared to year end 2017.

Related party transactions
For related party transactions, please refer to note 15 of our interim financLal report.

Principal risks and uncertainties of the first nine months of 2018
In the Annual Report 2017, we described the key business risks and uncertainties which we are aware of, and which could
have a material adverse effect on our financLal position and results.
We have assessed the risks for the first nine months of 2018 and believe that the risk categories and risk factors LdentLfied are in line with those presented in the Annual Report 2017. Those are deemed incorporated and repeated in this report by reference. Other risks not known to us, or currently regarded not to be material, could later turn out to have an adverse
material impact on our business, objectives, revenues, income, assets, liquidity or capital resources.

Responsibility statement
With reference to the statement within the meaning of article 5:25d (2c) of the Financial Supervision Act, the Management Board hereby declares that, to the best of their knowledge:
• the interim financLal statements prepared in accordance with IAS 34, “Interim Financial Reporting”, give a true and fair
view of the assets, liabilities, financLal position, profit or loss of the company and the undertakings included in the
consolidation taken as a whole; and
• the interim Management Board report gives a fair review of the information required pursuant to section 5:25d(8)/(9) of
the Financial Supervision Act.
Amsterdam, 31 October 2018
The Management Board

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