Leifheit Aktiengesellschaft: Leifheit AG continues upward trend in turnover and earnings in financial year 2021
/ Key word(s): Annual Report/Forecast
Leifheit AG continues upward trend in turnover and earnings in financial year 2021
Henner Rinsche, Chairman of the Board of Management of Leifheit AG, gave the following response to these results: "In 2021, we were able to build on our exceptionally good business performance from the previous year. We were able to systematically implement the initiatives within our Scaling up Success growth strategy with sustained impetus, which made a significant contribution to our success. This is reflected in the figures for the last two financial years. In 2020, Group turnover grew by 16% year on year, while earnings nearly doubled. In 2021, the Group once again increased turnover and earnings in spite of the challenges posed by the COVID-19 pandemic. However, one challenge will remain with us in 2022: the disruptions in the global supply chain have led to huge hikes in procurement prices, especially for commodities, freight and energy. This, along with negative currency effects, has had an impact on costs and caused a 2.7-percentage-point decline in our gross margin to 42.3%. On the other hand, we made targeted investments in consumer advertising for our Leifheit and Soehnle core brand products in the past year, thus creating the conditions for sustainable turnover growth and improvements in profitability."
In the Household segment, which is by far the largest and comprises the Leifheit brand as well as products in the cleaning, laundry care and kitchen goods categories, the Leifheit Group increased turnover substantially year on year by 8.3% to EUR 230.8 million (2020: EUR 213.1 million). As a result, the Household segment contributed 80.0% of Group turnover in 2021 (2020: 78.5%). The cleaning category in particular made a key contribution to the segment's strong growth thanks to a number of top-rated products, including the CLEAN TWIST Disc Mop Ergo and the CLEAN TWIST M Ergo flat mop, which both emerged as winners in product tests conducted by the German consumer magazine IMTEST. There is also a continued, pronounced need for hygiene in private households due to the ongoing COVID-19 pandemic, which supported a sustained increase in demand for cleaning products, especially for manual and electric floor cleaning products and the corresponding accessories.
In the significantly smaller Wellbeing segment with the Soehnle brand, turnover decreased slightly by 3.7% to EUR 25.5 million (2020: EUR 26.5 million). This equates to a 8.9% share in Group turnover (2020: 9.8%) and is due to the fact that the segment benefited particularly strongly from measures to combat the spread of the COVID-19 pandemic in financial year 2020. These effects are no longer present in 2021. By advertising Soehnle brand scales on TV for the first time and expanding marketing activities, the Leifheit Group achieved solid turnover growth in this product group despite more difficult general conditions and supply bottlenecks. Having previously jumped sharply, demand for air purifiers slowed considerably in financial year 2021. However, the company was able to maintain turnover of these products at a high level.
In the Private Label segment, the turnover of EUR 32.0 million generated by the French subsidiaries Birambeau and Herby in 2021 reached the previous year's level (2020: EUR 32.0 million). For a large proportion of the financial year, the segment benefited from the fact that important sales channels that were temporarily closed in 2020 remained open, despite new protective measures in the wake of the COVID-19 pandemic.
The Leifheit Group's capital structure remained solid in 2021. As at 31 December 2021, the company's liquidity reached EUR 38.1 million (2020: EUR 38.8 million). Equity rose marginally to EUR 111.3 million as at the reporting date (2020: EUR 100.4 million). With total assets declining slightly at the same time, the equity ratio was above the previous year's figure at 46.6% (2020: 43.7%). As in previous years, Leifheit had no liabilities to banks at the end of financial year 2021.
The Board of Management and the Supervisory Board will propose a constant dividend of EUR 1.05 per no-par-value bearer share for financial year 2021 to the Annual General Meeting on 25 May 2022, which will take place in virtual format due to the infection situation. After raising the dividend payment to EUR 1.05 per dividend-entitled share in 2021 despite uncertainty surrounding by the coronavirus pandemic, Leifheit is continuing its reliable dividend policy of previous years based on the good liquidity situation of the company.
"We are deeply concerned about the Russia-Ukraine war. Our thoughts are with the people affected and we hope that the conflict will end as soon as possible," says Henner Rinsche. "The economic repercussions in the current financial year on the Leifheit Group's business and on its financial position and results of operations are difficult to predict. We currently anticipate that the disruptions in the supply chains will continue to increase and - starting from an already high level - that energy and commodity prices as well as freight rates will continue to rise. At the same time, we must expect a negative impact on consumer demand in our target markets."
Due to the anticipated increasing cost burdens for the company, the Board of Management currently expects Group earnings before interest and taxes (EBIT) in business year 2022 to be significantly below the previous year's figure (2021: EUR 20.1 million). The Management board also expects a slight decline in Group turnover compared to the previous year's figure (2021: EUR 288.3 million).
The Management Board of Leifheit AG sees the company well positioned with the Scaling up Success strategy, even in the current crisis situation. The Leifheit and Soehnle brands offer essential everyday products, while the company is characterized by lean and efficient structures and has a solid financial basis.
The Leifheit Group's full annual report 2021 is available for download at www.leifheit-group.com/en/investor-relations/reports-and-presentations/.
29.03.2022 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
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