- Strong sales in emerging markets and the Equipment division
Charenton-le-Pont, France (October 22, 2010 - 6:30 a.m.) - Essilor
International, the world leader in ophthalmic optics, today announced its
consolidated revenue for the nine months ended September 30, 2010
Nine-month consolidated revenue
EUR millions 2010 2009 % Change % Change Contribution
(9 months) (9 months) (reported*) (like-for-like) from
Lenses and Optical
Instruments 2,685.0 2,396.5 +12.0% +2.5% +4.2%
Europe 1,047.1 989.4 +5.8% +0.8% +4.1%
North America 1,162.8 1,051.5 +10.6% +1.3% +3.8%
& Africa 333.6 259.7 +28.5% +8.4% +5.7%
Latin America 141.5 95.9 +47.5% +18.5% +5.5%
Equipment 91.6 71.9 +27.4% +10.6% +16.8%
Readers 127.2 - N/M N/M N/M
TOTAL 2,903.8 2,468.5 +17.6% +2.8% +9.7%
*Currency effect: +5.1%
Consolidated revenue for the first nine months of 2010 amounted to EUR2,903.8
million, up 17.6% compared with the prior-year period. On a like-for-like basis,
revenue rose by 2.8%, led by strong growth in sales in emerging markets and the
sharp recovery in the Equipment Division.
Changes in the scope of consolidation accounted for 9.7% of reported growth, of
which 3.1% for bolt-on acquisitions and 6.6% for strategic acquisitions (Signet
Armorlite and FGX International).
The 5.1% positive currency effect resulted mainly from the appreciation against
the euro of the US and Canadian dollars, the Brazilian real and, to a lesser
extent, the Australian dollar.
For the nine months ended September 30, Essilor reported 5.9% revenue growth
excluding the currency effect and strategic acquisitions, in line with its
Third quarter revenue up 21.4%
EUR millions Q3 2010 Q3 2009 % Change % Change Contribution
(reported*) (like-for- from
Lenses and Optical
Instruments 898.0 782.9 +14.7% +2.6% +4.4%
Europe 339.4 324.3 +4.7% -0.4% +4.0%
North America 386.4 333.4 +15.9% +1.8% +3.7%
& Africa 119.4 89.6 +48.3% +9.1% +7.4%
Latin America 52.8 35.6 +33.3% +21.7% +6.2%
Equipment 31.5 22.1 +42.1% +14.7% +27.5%
Readers 47.5 - N/M N/M N/M
TOTAL 977.0 805.1 +21.4% +3.0% +10.9%
*Currency effect: +7.5%
In the third quarter, consolidated revenue rose by 21.4% on a reported basis.
The 3% like-for-like increase confirms the upswing in demand observed during the
first half in a still uncertain business environment.
The impact of changes in the scope of consolidation added 10.9% to growth, of
which 2.9% from bolt-on acquisitions and 8% from strategic acquisitions.
Lastly, the decline in the euro against the Company's other billing currencies
had a 7.5% positive impact on third-quarter revenue.
Performance by region and by division was as follows:
- A still-fragile recovery in Europe, where the overall performance was affected
by weakness in the Instruments Division, due to a high basis of comparison. In
the corrective lens segment, sales continued to trend upwards in France while
demand improved in Germany, the United Kingdom and Poland. However, the
situation remained difficult in Spain and Italy.
- Gains in North America. In the United States, the new Varilux Comfort(r) New
Edition and Varilux Physio(r) EnhancedTM lenses were well received by
independent optometrists. Sales to optical chains were stable while demand for
polarized lenses remained strong.
- Ongoing sales growth in emerging markets in Asia. Demand continued to be
robust in India and China, as well as in the ASEAN countries where the product
mix improved. On the other hand, difficult market conditions persisted in Japan
- Very sharp growth in Latin America. In Brazil, the strategic development of
the premium and midrange segments generated an increase in unit sales and an
improvement in the product mix, with Crizal(r) lenses in particular making
significant gains. Growth was led by Argentina, where Essilor increased its
- Continued strong momentum for the Equipment division, which benefited from
firm demand for digital surfacing machines. The order backlog stabilized at a
- In line with forecasts, a satisfactory performance in the Readers division,
led by the success of new products.
Significant third-quarter events and other transactions
In the third quarter, Essilor made five new acquisitions, of which three in the
United States, one in the United Kingdom and one in India.
In addition to the previously announced transactions with Gulf States and PASCH
(Nikon-Essilor), Essilor of America forged a partnership with Reliable Optics, a
Brooklyn, New York-based prescription laboratory that generates approximately
$4.3 million in revenue.
In the UK, Essilor acquired an 80% stake in Leicester Optical, a prescription
and edging laboratory based in Rothley with sales of EUR 1.8 million.
In India, Essilor acquired a majority stake in GKB Optics Technologies, a
prescription laboratory based in New Delhi with annual revenue of EUR 0.8
Since the beginning of the year, Essilor has acquired 18 companies (excluding
Signet Armorlite and FGX International) representing additional full-year
revenue of approximately EUR92 million.
On October 15, Essilor announced an agreement with Kibbutz Shamir to acquire 50%
of Shamir Optical, an independent producer of ophthalmic lenses that reported
2009 revenue of $142 million. The transaction, which is subject to the approval
of Shamir Optical's shareholders and various regulatory authorities, is expected
to close in mid-2011.
Between July and September, Essilor purchased 1.63 million of its own shares on
the market, at a total cost of EUR78 million. Essilor also sold its
long-standing stake in Sperian Protection to Honeywell, generating net proceeds
of EUR132 million.
Combined with these transactions, cash flow generated during the period enabled
the Company to reduce its net debt from EUR638 million at June 30 to EUR332
million at the end of September.
In the context of a gradual recovery in the world economy, Essilor is continuing
to diligently deploy its growth strategy, based on new products, geographic
expansion, bolt-on acquisitions and gains in the mid-range segment. For the full
year, the Company confirms its objectives of revenue growth of 5% to 7%
excluding the currency effect and strategic acquisitions, and a stable
contribution margin excluding strategic acquisitions and changes in IFRS.
Appendix - Quarterly revenue data
EUR millions Q3 2010 Q2 2010 Q1 2010 Q3 2009 Q2 2009 Q1 2009
TOTAL 977.0 1,020.9 905.8 805.1 823.0 840.4
Europe 339.4 362.3 345.3 324.3 335.0 330.0
North America 386.4 400.8 375.7 333.4 345.7 372.5
Asia-Pacific 119.4 111.2 103.1 89.6 84.4 85.7
Latin America 52.8 48.8 39.9 35.6 32.5 27.8
Equipment 31.5 36.6 23.6 22.1 25.4 24.4
Readers 47.5 61.4 18.3 - - -
A conference call in French will be held today at 9:00 a.m. CEST.
The number to dial is: + 33 (0)1 70 99 42 67
The conference will be available for later listening at:
The world leader in ophthalmic optical products, Essilor International
researches, develops, manufactures and markets around the world a wide range of
lenses to improve and protect eyesight. Its flagship brands are Varilux(r),
Crizal(r), Essilor(r), Definity(r) and Xperio(TM).
Based in France, the Company reported consolidated revenue of more than EUR3.2
billion in 2009, with 34,700 employees and operations in 100 countries.
For more information, please visit www.essilor.com.