Following the sharp Argentinian peso devaluation of more than 50 percent on December 13, Verallia has reviewed its 2023 revenue outlook and it now believes that the conversion impact of its local turnover into EUR will prevent it from reaching its year-on-year consolidated revenue growth target of at least 20 percent in 2023.
The Group is indeed required to apply the IAS 29 “Hyperinflation” accounting rule to its Argentinian activities and thus has to convert its entire local income statement of the year into EUR in its 2023 accounts based on the period’s closing rate rather than the customary average rate.
The projected contribution of Argentina to the Group’s 2023 revenue is therefore reduced by half and this decline cannot be offset with only three weeks to go before year end, despite the now minor share – around 2 percent – of Argentina in the Group’s revenue.
Verallia confirms its 2023 adjusted EBITDA target of more than EUR 1.1 billion.