DGAP-News: Leifheit Aktiengesellschaft / Key word(s): Quarterly / Interim Statement/Quarter Results
Leifheit AG: Group turnover almost on a par with the previous year
- Strong growth in Germany despite unfavourable weather conditions
- Brand Business increases
- Volume Business down year on year
- Forecast 2018 slightly adjusted
Nassau, 15 May 2018 - The Leifheit Group concluded the first quarter of financial year 2018 with stable year-on-year turnover in spite of unfavourable weather conditions. Group turnover fell only just short of the previous year at EUR 62.2 million (previous year: EUR 62.5 million). Strong growth in Germany was not able to fully compensate for the decline in business in Central and Eastern Europe. Earnings before interest and taxes (EBIT) declined slightly by EUR 0.4 million to EUR 4.7 million (previous year: EUR 5.1 million).
Substantial growth in Germany business
Leifheit further expanded its position in Germany in the first quarter of 2018 despite the unfavourable weather conditions in March. Group turnover in Leifheit's domestic market grew by 4.9% to EUR 30.3 million (previous year: EUR 28.9 million) while the share of overall turnover attributed to Germany business increased to 48.7% (previous year: 46.2%). The company particularly benefited from product innovations such as the new Leifheit Regulus PowerVac 2in1 Cordless Vacuum Cleaner and Soehnle Connect products.
By contrast, the Group recorded a decline in turnover to EUR 31.9 million (previous year: EUR 33.6 million) in its international business. This was due to a lack of sales volumes in Central and Eastern Europe. In the first quarter of the previous year significant brand-building activities led to substantial growth in Eastern Europe. Similar programmes are planned for upcoming quarters.
Brand Business involving the Leifheit and Soehnle brands closed the first quarter of 2018 with a slight rise in turnover of 0.3% at EUR 52.8 million (previous year: EUR 52.7 million). Product innovations and the strong results in Germany and France contributed in particular to this growth trend. Significant turnover growth was recorded in the laundry care and wellbeing product categories. However, turnover in the cleaning and kitchen categories failed to match the previous year's figures.
In the smaller Volume Business, which is managed with a focus on profitability, turnover fell by 4.1% to EUR 9.4 million. Strong turnover growth in Germany was not able to fully compensate for the lack of sales volumes for Herby laundry care products in France. That being said, turnover involving Birambeau kitchen products in France and steam iron products in the laundry care category developed positively.
In the first quarter of 2018, the Leifheit Group posted EBIT of EUR 4.7 million (previous year: EUR 5.1 million). The EUR 0.4 million decline was due to a decline in gross profit caused by currency effects and increased material costs. Improvements in the areas of distribution costs and administrative costs were unable to fully compensate for this trend. The EBIT margin was down year on year at 7.5% (8.2%) and fell just short of the long-term target corridor of 8%. The Leifheit Group generated a net result for the period of EUR 3.1 million (previous year: EUR 3.4 million) in the first quarter of 2018.
"We once again expanded our position in our core market of Germany and therefore also our Brand Business in the first quarter of 2018, in spite of unfavourable weather conditions for our business in March," said Thomas Radke, Chairman of the Board of Management of Leifheit AG. "The reorganisation of the sales force in our Brand Business is already bearing fruit, while our product innovations are making an ever-increasing contribution to company turnover. Nevertheless our business in Central Europe and in specialty trade remained behind our expectations. We are getting on with implementing our amended 'Leifheit 2020' strategy to respond to changing market conditions and return to broader, sustainable growth."
2018 forecast slightly adjusted
For Business year 2018 the Group expects to generate a turnover growth slightly below the forecast of around 4% to 5%. After some weaknesses in March respectively in Central Europe, the Board of Management will analyse the further Business development very carefully and will concretise the turnover forecast for the half year reporting. EBIT for the financial year 2018 is expected to be at the lower end of the forecast of around EUR 17 million to EUR 18 million.
Additional information can be found in the quarterly statement for the period ending 31 March 2018, available at http://financial-reports.leifheit-group.com.
Leifheit AG, founded in 1959, is one of the leading European brand suppliers of household items. The company stands for high quality, innovative products with great utility and functional design in the sectors of cleaning, laundry care, kitchen goods and wellbeing. Leifheit and Soehnle are among the best-known brands in Germany. In addition to the Brand Business, Leifheit AG operates in the service-oriented Volume Business via its French subsidiaries Birambeau and Herby. The Leifheit Group and its international branches combined have around 1,100 employees. More information on Leifheit is available online at www.leifheit-group.com, www.leifheit.de, www.soehnle.de.
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15.05.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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