Ladies and gentlemen, good morning. Thank you for coming to the presentation of our consolidated results as of 30th June 2018. We have Baptiste Janiaud, our administrative and financial officer with us, who will set forth the main information to be gleaned from our good results. Since we are working on the solidity of our balance sheet, the positive effects of our recent refinancing on our development prospects. As far as I'm concerned, I would like to underscore the quality of our half year results, and say a few words on 2018, the outlook, and the outlook beyond 2018. First of all, let me point out that earnings have been up sharply on June 30th, 2018. The net result is up by 150% net income as compared with the previous year.
That's the result of sustained growth, 10% up for the contributed revenue, but it's also the result of an improvement in our operating margins with EBE up 21% and up more than 52% in COI when compared to the first half 2017. That operational performance goes hand in hand with the strengthening of our balance sheet. Financial debt has gone down, and the gearing as of 30th June 2018 is back down to three times the EBE. That was the objective that I announced at the beginning of the year. That is three times EBITDA. That good performance, as well as the operating results, can be seen on our two perimeters, France and international. Particularly internationally, the strong growth in our activity and even stronger growth in operating results are the result of our new subsidiaries in Latin America and Solarca in Spain.
I'm particularly pleased those subsidiaries, bought out only a year ago, have revealed their potential as early as 2018. Of course, I fully trust that we will pursue that international development, which for us is a major component of our total development. In the course of the first half 2018, Séché Environnement has taken advantage of very promising markets in France. At the same time, we've strengthened our activities on our international markets. In France, in particular, the group benefited from significant volume effects. This volume growth is a result of a good conjuncture, which has also benefited industrial production. It's basically our processing activities, incineration, and storage that have benefited from that. Over the half year, all our activities are up. I mentioned processing, reuse, recycling have also enjoyed strong levels of activity.
First of all, when it comes to hazardous waste with Speichim and Valls Química , our specialized subsidiaries, and also activities in reuse of waste for energy. Our group has benefited from the ramp-up of our recent investments, particularly new energy production capacities in La Gavotte in Guadeloupe, and especially the CSR unit at Changé in the department of Mayenne. At the same time, our service activities have also confirmed their dynamism, particularly in decontamination. Internationally, as I said, growth was borne by our recent acquisitions. In Latin America, we invested in Peru and in Chile in order to enhance the storage capacities for hazardous waste. This has made it possible for us to address the new industrial customers in those two countries.
In the rest of the world, where we're present in the industrial service markets through Solarca in particular, activity was particularly strong, particularly when compared with the first half year 2017, which was relatively low for that branch. This was also helped out by the favorable activities mix, which contributed to the strong rise in operating margins. Baptiste will speak about those elements in his presentation, but the improvement of our operating margins strengthened our cash generation. At the same time as we announced our industrial development investments were limited when compared with the first half of 2017. Free cash was strengthened, and we've concretized our debt, lowering our debt as of this half year. Baptiste will give you more information on those positive impacts on our balance sheet. After the first half 2018, we are stronger. As I've said, the economic situation was particularly favorable.
We benefited from a volume and activity mix effects were very positive for the first half year. In the second half, we are expecting a more stable economic environment, which should lead to performance results as well as our operational results that are comparable to the first half year. We are confident that we will reach our annual goals, first of all, in terms of growth. It should even be a bit higher than what we announced at the beginning of the year, and also in terms of operating results. We are also considering the medium term with confidence. Our financial situation is more solid and will continue to become more solid in the future.
The refinancing carried out in early July will make it possible for us to benefit from increased cash and better rates in order to finance our development projects via internal or external growth, organic or external. We are on a good growth and profitability trajectory, such as we presented in our recent Investor Day. That is to say, organic growth, which should make it possible to have a contributed revenue between EUR 550 million and EUR 600 million by 2020, and EBITDA in 2020 of around 20% of our contributed revenue, not counting external growth. Those are the few messages that I wanted to deliver by way of an introduction. Let me now hand it over to Baptiste, who will give you further detail on the financial performance for the first half year. He will speak about, of course, the current year as well.
Merci, Joël. Thank you, Joël. I'm going to run through, as per usual, all the key figures, some information on CapEx, gross cash flow, the metric that we track very closely to manage the company, and then change in net debt. I'll run through all these aggregates in greater detail after that. As regards to the first half, as Joël said, we have revenue that is sharply up at EUR 277.6 million, sharply up 10% versus first half 2017. EBITDA, EUR 51.8 million, with a margin of 18.7% from operating income, sharply up versus 2017. Current Operating Income, EUR 20.7 million with an operating margin at 7.4%. Net income stands at EUR 9.2 million, also sharply up over last year.
CapEx that come in at EUR 22.5 million, and gross cash flow positive that serve to reduce our net debt, be it on the IFRS standards or the banking definition that serves for the debt covenants. I will first focus on level of activity. As Joël said, very positive overall dynamics across the first half that impacts directly on hazardous and non-hazardous waste. We have contributed revenue up EUR 25 million, plus EUR 15 million for non-hazardous waste, plus EUR 10.5 million on hazardous waste. For hazardous waste, we have a level of activity that is very dynamic across businesses, buoyed by a processing facility that is very dynamic with volume increases that are significant in France, and very positive momentum internationally, as Joël indicated, with storage activities in Chile and Peru that have come in well, and a service activity via Solarca delivering a very active first half.
For non-hazardous waste, we saw during the first half that we had a decontamination activity that was significant. We saw that also in the second half. Level of activity in the first half that is buoyed and driven by services, of course, driving storage activities, benefiting from a very significant volume effect. This growth is, of course, boosted by the ramp-up of our recovery solutions. The CSRs Changé versus the first half, which clearly impacts our activity. Focus by quarter, the key takeaway, we had a Q2 in terms of activity that was very sustained, affecting both hazardous and non-hazardous revenue. As regards the France international split, which is a split that we track regularly, you see that we have an international segment that continues to grow. To remind you, this share of international revenue was 5% in 2016, 9% in the H1 2017. We are at 11% H1 2018.
The no scope effect in moving from 9% to 11%, in spite of very positive momentum in France, we also have sustained growth internationally with revenue going from EUR 25 million to EUR 31.4 million. That is an increase of EUR 6 million, in other words, 30% at a constant exchange rate. This increase in activity comes essentially from the Solarca services, very dynamic first half, and also equally between storage in Latin America, Peru, Chile, and recovery with purification business in Spain that was very dynamic. Overall, we see hazardous waste activity internationally that is very positive in terms of dynamics and confirms our strategy of internationalization on hazardous waste. Second part is obviously Development France, with an increase in revenue of +8.2%.
About half of that is for storage, hazardous, non-hazardous waste, good recovery levels, and of course, with the ramp-up of the Changé RCU, and very good level of contamination activity. We saw that in the first half. That is replicated in H2. All in all, when we consider in terms of activity, treatment, recovery services, all our businesses contributed to positive growth in revenue in differing proportions. Treatment and services, very dynamic in the first half. A significant contribution of treatment on hazardous waste, and a significant contribution of decontamination activities in services for hazardous waste, driving treatment activities. These are very closely linked. In other words, when we decontaminate, we are obviously fueling treatment activity. After activity, an update on profitability regarding earnings. EBITDA at June 30th, 2017, came in at EUR 43 million. At the end of this first half, we are at EUR 51.8 million.
Gross margin is up EUR 8.7 million, split EUR 6 million for France, EUR 2.5 million international. There's noteworthy, very significant volume effect on treatment and services activity consistent with what we saw previously. Also to be noted, an increase in fixed costs. These are the representation costs and headcount costs that are up EUR 1.5 million. Another item of EUR 2 million, miscellaneous. The land tax has not increased. That impacts 2017/2018. That's a one-off of EUR 2 million and doesn't, of course, affect the profitability. Geographically, EBITDA EUR 46.5 million for France, with an EBITDA margin of 18.9%, sharply up in terms of geography, because 17.7% the H1 2017. In international, EBITDA at EUR 5.3 million with a margin of 17% of contributed revenue, driven by storage activities in Latin America, services in Spain, as I indicated. Moving down to current operating income.
Obviously, there's a change in COI that tracks the change in EBITDA because it goes from EUR 13.6 to EUR 20.7 million. There's a positive contribution France International. The differentiating element is the major impact on the H1 2018 on provisions for amortization due to volume increases in storage businesses. That de facto increases the amortization, and that has an impact on COI profit from operations on the right there. You can see that it's sharply up with an operating margin of 7% on contributed revenue in France and 10.6% from international contributed revenue. Moving down the income statement, down to net income from current operating income to operating income. Briefly, there's a difference of some EUR 2 million. That's primarily due to a provision booked as part of a customs control from EUR 1.8 million that we're challenging, and costs as part of the reorganization of the group.
That group reorg helping to boost productivity of our operations. Finance income stands at EUR 6.4 million, down versus H1 2017. This is due to a decrease in the cost of debt, 3.11% as against 3.38% H1 2017. We also note that this financial income doesn't take recent financing, because recent refinancing was closed in July, we just have the costs linked to the H1, that's before refinancing. This decrease has a real impact on the H1. We're expecting an increase in H2 linked to one-off non-recurring events. Since they were refinanced early, there'll be a one-off exceptional cost charge linked to the reversal, the write-back of all the costs that were amortized on the previous loan, and this will have an impact on the H2. Corporate tax is up EUR 1.5 million H1 2017. It stands at EUR 3.1 million in 2018.
This is primarily due to the increase in the tax base following improved operating margin. We have smaller numbers. Companies consolidated at equity, an increase, the contribution of EUR 0.3 million of Kanay linked to improved earnings from Kanay. That's a Peruvian company that we don't control, that is consolidated, accounted for by the equity method with posting improved earnings. Net income overall, that is sharply up given all these items coming in at EUR 9.2 million. Of course, automatically leads to an increase in our equity IFRS coming in at June 30th at EUR 245 million. As regards CapEx investments, we discussed this at length at the start of the year in terms of our targets. The target, the goal is to contain investments and EBITDA minus CapEx June 30th. We can say that overall we're on track.
We have CapEx that are down in the first half 2018 as against H1 2017, with, in particular, a significant decrease in development CapEx. This comes primarily from the end of the large CSR unit furnace at Changé, and we have EUR 23.4 million CapEx in line with the target set, affecting primarily storage capacity and maintenance CapEx for the incinerators. Given the message that we delivered at the start of the year demonstrates our flexibility on CapEx and primarily development CapEx, where it was achieved during the first half. Moving on to cash flow. We have gross cash flow, recurring operating cash flow that is up EUR 31.5 million H1 2017, EUR 39.5 million H1 2018. That's up essentially due to the increase in EBITDA. Gross cash flow, EUR 11.6 million. A change in WCR that's slightly negative to the tune of EUR 4 million.
That's due to a lag of receivables, collection data of receivables from local authorities. That's from the Strasbourg Séché Environnement contract, that WCR will probably be reversed in H2. On change in debt from gross cash flow to net debt, we see the net financial debt 31st 2017, EUR 325 million. It comes in at the end of June at EUR 318 million. This decrease is due to cash flow generation on the first half and shows that at steady state cruising speed, we can generate cash flow and reduce our debt. On the financial leverage, we have a 2018 target, which was at 3x, as we indicated during the presentation of the annual results 2017.
The goal, the target for 2018 was achieved in the first half end of June, with cash of EUR 46 million cash position, which is comfortable given our WCR cycle and our current debt.
Yes. Of course. On 30th of June, the banking covenants having to do with gearing and having to do with the leverage, as indicated in the presentation, will no longer be valid for the coming quarters, I'll come back to that point in the following slides. As of June 30th, the former covenants were still in force, that's why they were respected, that's why we're in advance with respect to our 2018 forecasts. Let me come back to refinancing that was closed in July 2018. All in all, that refinancing concerned EUR 420 million with the banking debt, along with criteria and the environmental impact of EUR 270 million. That is an amortizable loan maturing, EUR 70 million over five years. New lines of liquidity.
This is a very important element, EUR 200 million with a revolving credit line of EUR 150 million, which will serve our growth and our general needs. A redeemable term credit, which is there to refinance our private investment. That amounts to EUR 50 million. Those that will reach maturity in the coming years. That refinancing integrates the environmental impact criteria, which are likely to reduce the cost of bank debt. This is something which is important to keep in mind and which is new.
Bank bond issuance, which is unrated, mainly for the world of bond investors, and which also includes a bank placement of a total amount of EUR 150 million, an average maturity of 7 years, and an average coupon of 3.25% with a single covenant, which we will manage as of the next publication with a leverage of 3.95x EBITDA, which may be increased to 4.25x in the event of acquisitions. That doesn't mean that we're going to immediately go to 3.95x, because our objective is three, but it will give us more flexibility in case there was significant organic growth or external growth acquisitions. The point of this refinancing is, of course, to extend the debt maturity between the end of 2017 and after the refinancing. You can see that we have a schedule, which is more spread out, or up to 2024.
There's the bond issue that will be refinanced, we'll have more visibility on that with an increase of the average lifespan for 3.8 years at the end of 2017 and 6.4 average lifespan in July 2018. Average maturity, that is. The objective is to give us the means to finance our development. To take the group's development strategy and give it the proper financial resources. We have a liquidity line which is significant for EUR 150 million, which can be used if there ever was a WCR issue or a development issue. We could draw down for five years EUR 150 million, we've secured refinancing of the Euro PPs, which reach maturity in 2019 and 2021. That clearly aims at giving us the financial resources to develop and to secure the refinancing over the coming years.
We can say that as of today, the group no longer has any cash or liquidity problems and won't for the coming years. To give us greater flexibility in the case of external growth, that's a point which I've already made, which I won't come back to. Also to position our strategy as a player in sustainable development is very important. We need to integrate those criteria in our refinancing that can go through the concerned energy efficiency, biodiversity, as well as an external rating carried out by EthiFinance. That's an extra financial entity that takes account of social, environmental, and governance criteria. EthiFinance, that is.
Concerning our outlook for the second half of 2018, what we can see today and what we're presenting, you can see that there's a very positive message concerning the first half, because the first half was extremely promising, both in terms of our activity, and activity generates good results, good operating results, and a strong net result. This is assisted by a strong activity in France and internationally. The performance with storage in France and international services were extremely dynamic. A very favorable trend when it comes to activity mixed. Even if we can see that all of the tools contributed to our performance, we have an activity mix, which is very favorable in particular, and which contributes to improving operational profitability and EBITDA.
This helped us to bring down net debt, IFRS and bank debt, and to reach the objective of three times EBITDA, which is a financial objective that's ambitious. The second half should be similar. That is to say, we are expecting a good macroeconomic context, a stable context in France, as well as growth of our activities in Latin America. Let's not forget that we are in a world that's changing. There's increased volatility on the emerging markets. We saw this in the recent weeks, very strong volatility, even a depreciation of currencies in the emerging countries as a whole. In a geopolitical context and in a foreign exchange market context that are volatile, we have to take account of all that in our outlook.
An activity mix for the second half, while we're expecting dynamism in processing, particularly incineration, and greater contribution of the services to our French activities, our objective is to continue to drive our free cash flow and to master our development CapEx whilst maintaining our objective of a stable leverage around three times EBITDA. In more precise terms, we're expecting contributed revenue in the second half that's similar to that of the first half and EBITDA that's also comparable to the first half. This, of course, reassures us when it comes to our 2020 plan that we presented on Investor Day. As Joël said, we're expecting growth. Our profitability objective is still very clear, 20% EBITDA margin by 2020. We will maintain that objective, and we're expecting organic growth of between EUR 550 million and EUR 600 million. Let me now give the floor to Joël for outlook.
Thank you, Baptiste, for those words of explanation. Therefore, we are on the road to selective and profitable growth as we have set forth for our medium-term prospects. Selective, that is an industrial investment policy which is well mastered and profitable with a view to a return on investment and enhanced flexibility. Therefore, we are confident that we will achieve our 2018 goals. In the second half, the macroeconomic environment should become stable when compared to the first half. At any rate, in France, we think that in that context of greater stability, our level of activity should remain solid in our main business lines on the second half of the year. Traditionally, as you've noted, I'm sure the second half has been more contributive than the first when it comes to revenue as well as COI.
This year, the good performance of the first half in our processing activities or treatment activities have led us to a more balanced view of our activities over both halves. We also think that the positive mix effects that occurred in the first half will not allow for greater improvement of our operational profitability. Therefore, we are expecting activity in the second half that will be comparable to the first half with operating COI, sorry, that will be comparable. As we announced at the beginning of the year, we will maintain our master investment policy in 2018. I can confirm that we are aiming at a leverage objective of around 3 times EBITDA by the end of the year. We are now opening the floor to questions and answers.
Since results are good in general, that means there are less questions. Don't be shy. Speak up. Baptiste is ready. Good morning. I have 2 questions, in fact, regarding Peru. There's the equity method, as you said, I think that's still the case, but they're still in the contributive revenue. They're still counted. I'd like to know what's going on there. That's the first question. Should I ask the second question? No, let me answer the first question. There are 2 companies in Peru, Tauris, which is globally integrated and therefore, which is part of EBITDA and contributive revenue, and there's Kanay, to which the equity method applies. So it's integrated de facto in our results, but by the equity method. With Kanay, there's an option to increase your shareholding, right? Right. But for the time being, it's still the equity method. I said before, it's still true.
That company should become part of our perimeter. We have an option to integrate it, but for the time being, we haven't used that option. I have a question that you spoke about deconsolidating factoring. I'd like to know whether you set up No, that was not factored into the analysis. On 31st December 2017, there were EUR 24 million in receivables, deconsolidated receivables. There's the same amount on 30th June 2018. That's a series of receivables to be invoiced. Thank you. Are there any other questions? Yes, at the back of the room. Good morning. You said that in the second half, there should be a financial result that should be higher, or that should be increased, at least on an exceptional basis. Can we have an idea as to that exceptional amount and what that means for the following years?
The effect of the second half, there will be a non-recurrent, exceptional impact amounting to about EUR 1.5 million. Now, when it comes to refinancing, not taking kind of exceptional events, what we would expect would be a cost, an increase in financing around 10 basis points between 2017 and 2018. Given the new refinancing of the over cost of bonds when compared to short-term debt. As compared to short-term debt. Any other questions? Is everything clear? Thank you very much.
One last question. This is Luca from [Abastie]. I can see that your finances have offered you to increase your debt ratio in the case of acquisitions. Are you referring to, or hinting at international acquisitions or what? Of course, we have an investment watch over all possible growth that we can achieve or assets that we can buy.
Very active watch when it comes to our international activities. We want such growth to be very selective. That is, we have to find, as we found in Chile and Peru, we have to find activities that are profitable, which would add value, to which we could add value, to which we could add our expertise, and which could be accretive when it comes to the results. Of course, the global regulatory and political environment has to be positive. This is something that we do. We keep watch on a recurrent or on a continuous basis. The difference today with respect to the past is that we have the means to carry out our strategy. That is, if we found assets that met the different political, economic criteria, and that could be accretive, and to which we could add value, we could take a more active attitude.
That is, such an investment would be more realistic today. We don't have anything to announce today. We are keeping an active watch over such opportunities on a continuous basis, more internationally than in France. The example of Peru and Chile are good examples today. That is to say, we acquired a company which we're growing, of hazardous waste, to which we're adding our expertise. The activities are there. Results are forthcoming, and Solarca in Spain, too, in a particular niche activity. That's a company that will help to fill out our range of industrial services. These were success stories. This is the sort of acquisition that we want to continue. Of course, they'll necessarily be small tuck-ins because we will then grow those activities by investing therein and by filling out the range of activities given the palette of activities that we can provide in France.
Any other questions? Well, ladies and gentlemen, thank you very much.