Leifheit Aktiengesellschaft: Group turnover on par with previous year


Corporate News

DGAP-News: Leifheit Aktiengesellschaft / Key word(s): Quarterly / Interim Statement/9-month figures

14.11.2018 / 08:34
The issuer is solely responsible for the content of this announcement.

Leifheit AG: Group turnover on par with previous year

  • Group EBIT of EUR 8.7 million following 11.3 million in previous year
  • Turnover and earnings forecast for 2018 lowered
  • Optimisation of distribution activities and product development launched
  • Improvement of E-commerce processes and activities initiated
  • International Group structures expanded

Nassau, 14 November 2018 - Leifheit AG, one of the leading European brand suppliers of household items, achieved Group turnover of EUR 177.0 million in the first nine months of the current financial year, which was nearly on par with the previous year's figure of EUR 177.5 million. Following EUR 11.3 million in the previous year, earnings before interest and taxes (EBIT) stood at EUR 8.7 million in the first nine months of 2018. The Board of Management is working hard to implement far-reaching strategic measures in order to create the conditions for sustainable turnover growth and improved profitability.

Thanks to moderate growth in Brand and Volume Business, Leifheit succeeded in increasing Group turnover in its domestic market of Germany by 0.4% to EUR 77.6 million (previous year: EUR 77.2 million). The German market therefore accounted for 43.8% of total turnover (previous year: 43.5%). In foreign markets, the Leifheit Group recorded a slight drop in turnover of 0.8% to EUR 99.4 million (previous year: EUR 100.3 million). As a result, the foreign share stood at 56.2% (previous year: 56.5%). In the Central Europe region, turnover grew by 0.9% to EUR 75.2 million in the first three quarters of 2018 following EUR 74.6 million in the same period in the previous year. In Eastern Europe, however, the Leifheit Group recorded a slight drop in turnover of 1.1% to EUR 19.1 million (previous year: EUR 19.3 million). Strong growth in Poland and Romania was unable to fully compensate for declines in Slovakia and Hungary, where turnover was influenced by targeted brand expansion activities in the same period in 2017.

In the first nine months of 2018, the company generated turnover of EUR 150.3 million in the strategic core of the Leifheit Group's business, Brand Business, which features the Leifheit and Soehnle brands. This figure corresponds to an increase of 0.5% compared to the previous year's figure of EUR 149.6 million. By posting significant increases, the cleaning and wellbeing product categories contributed to turnover growth. The market for electrical appliances for cleaning glass surfaces, however, saw increasing saturation. The kitchen and laundry care sectors also recorded a decline in demand.

In Volume Business, the significantly smaller segment of the Leifheit Group, the company recorded a 4.3% decline in turnover to EUR 26.7 million in the reporting period (previous year: EUR 27.9 million). In this segment, the company generated solid turnover growth domestically and posted slight gains in the core market of France as well, which was offset by a substantial decline in Austria as well as a drop in turnover at the Herby subsidiary and in Project Business in the US. By contrast, kitchen products brought turnover growth to Birambeau in France.

The main reason for the decline in EBIT from EUR 11.3 million in the previous year to EUR 8.7 million was the lower gross profit on account of currency effects, price increases for materials and sales deductions, as well as expenses related to Board of Management changes. These factors were offset by significantly lower distribution and administrative costs as well as an improved foreign currency result. However, neither factor was able to fully compensate for the decline in gross profit. The net result for the period fell accordingly to EUR 5.5 million (previous year: EUR 7.4 million).

Ivo Huhmann, a member of the Board of Management and the Chief Financial Officer of Leifheit AG, says: "We are currently focusing on the implementation of key strategic measures. Leifheit is an established company, with solid financial footing and strong brands. Nonetheless, we need to make many important targeted adjustments within the Leifheit Group so as to advance and enhance our business model. One focal point is making the processes behind our sales and distribution channels more efficient and doing a more consistent job of seizing the potential offered by e-commerce. At the same time, we will encourage consumer-relevant innovations and improvements to the existing product range in the year ahead. We will also continue expanding our international structures by way of the newly founded distribution company in China and brand-building activities in selected Eastern European markets. Furthermore, we have introduced measures to improve processes and optimise the entire value chain."

In the light of the development of turnover as at 30 September 2018 in connection with the dismissal of the chairman from the Board, the Board of Management of Leifheit AG again adjusted the earnings and turnover forecast for the current financial year on 15 October 2018. As announced on that day Leifheit now expects turnover to be approximately on par with the previous year in financial year 2018 (previous year: EUR 236.8 million). Until recently, the forecast had been for growth of 2.5% to 3.5%. Leifheit expects slight growth in Brand Business. In Volume Business, the smaller and more volatile segment, the company expects turnover to be down slightly on the level seen in 2017. The Board of Management of Leifheit AG is now forecasting earnings before interest and taxes (EBIT) of EUR 13 million to EUR 14 million for financial year 2018.

Additional information can be found in the quarterly statement for the period ending 30 September 2018, available at http://financial-reports.leifheit-group.com.

About Leifheit

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.

Leifheit AG
D-56377 Nassau
+49 2604 977218

14.11.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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