Ad hoc notice in accordance with section 15 German Securities Trading Act (WpHG) - Leifheit AG significantly increases profitability
• 5.7 % growth in turnover in the first nine months of 2011
• Operating results outstrip turnover with 10.1 % growth
• Despite the downturn in the economic outlook, double-digit annual results expected
Nassau, 14 November 2011 - The Leifheit Group increased consolidated turnover in the first nine months of 2011 from € 156 million by 5.7 % to € 165 million. Over the same period, EBIT rose significantly faster, growing 10.1 % from € 6.4 million to € 7.1 million. The high EBIT growth is particularly satisfactory, as high commodity prices were still weighing heavily on results, particularly in the Volume Business segment. The result after tax rose 67.2 % from € 3.6 million to € 6.0 million.
Georg Thaller, Chairman of the Board of Management of Leifheit AG: “Leifheit was on track in the first nine months of the current financial year. The numbers show that we are consistently following our principle of profit before size. This is a central goal of our three-year growth programme, which started in January.”
Strong German economy reflected in turnover
The German market was the driver of the overall growth in consolidated turnover in the first nine months of 2011. The domestic share of sales rose from 43 % to 44 %. By contrast, there was a negative trend in several European markets and the overseas markets, as a result of significant deterioration in the overall economic situation. The positive trend in the German economy, compared to other countries, the stable labour market and the continuing willingness to buy of German consumers were all evident here.
Brand Business maintains stable growth
Leifheit’s business comprises the segments Brand Business (Leifheit, Dr Oetker Bakeware and Soehnle) and Volume Business (Birambeau, Herby and project business). As in the first two quarters, the Brand Business segment maintained stable growth in turnover. In the first nine months of 2011, Leifheit grew turnover in this segment by c. 5 % to € 129 million, from € 123 million in the comparable period in 2010. The share of Brand Business in consolidated turnover was more or less unchanged from the previous year at 78 %. While domestic turnover rose, developments in other regions varied widely in the period under review, depending on the local economic situation. In terms of the Leifheit Group’s various product categories, the areas of cleaning, laundry care and wellbeing were the drivers of growth in Brand Business. EBIT in Brand Business grew substantially as expected, rising from € 2.6 million to € 4.3 million.
Volume Business growing by c. 9 %
As in the previous year’s quarter, Volume Business showed strong growth, with turnover up by c. 9 % year-on-year at € 36 million. The segment’s share in consolidated turnover accordingly rose slightly from 21 % to 22 %. The main growth in Volume Business is in foreign business, mainly France and the US. However, growth in domestic turnover in the past nine months has also been extremely satisfactory, with particularly strong growth in the laundry care category. Despite the significant increase in turnover, EBIT in Volume Business lagged behind the previous year’s figure, falling from € 3.8 million to € 2.8 million. Besides one-off costs of closing down a production plant in Tunisia, results in Volume Business were hit particularly by increased commodity prices.
Forecast for full-year 2011 confirmed
With its focus on household products, the Leifheit Group is well positioned in the current economic environment to grow as planned. Leifheit is demonstrating its innovative strength with products such as the Soehnle “Relax” range with the new massage chairs, the “Page Evolution” kitchen scales (winners of the iF Product Design Award 2012) and the innovations in the area of steam ironing. These products were recently presented at the Berlin IFA, and were very warmly received by the trade, so that additional growth in turnover can be expected in these areas. In addition, the repositioning of the kitchen category as part of the renewed umbrella brand and product range strategy under the Three-Year Programme, should provide further stimulus from 2012.
Despite the global economic slowdown, Leifheit still expects growth in turnover of 3-5 % for full-year 2011. Looking at changes in raw materials prices in the past months, no further impact is currently expected on results in the fourth quarter. The adjustments in selling prices which Leifheit has been making since the third quarter of 2011 have also partly offset the increase in raw materials prices. Georg Thaller: “We expect double-digit EBIT in 2011, confirming our long-term growth course”.
Additional information is available in the interim report for the period ending 30 September 2011.