18.07.2013 DE0007657231
DGAP-News: Villeroy & Boch AG: Earnings targets for 2013 as a whole confirmed; revenue increase anticipated at lower end of corridor (+3 %)

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DGAP-News: Villeroy & Boch AG / Key word(s): Half Year Results Villeroy & Boch AG: Earnings targets for 2013 as a whole confirmed; revenue increase anticipated at lower end of corridor (+3 %) 18.07.2013 / 08:00 --------------------------------------------------------------------- Press Release Mettlach, 18 July 2013 Villeroy & Boch: Interim Report on the Second Quarter of 2013 Earnings targets for 2013 as a whole confirmed; revenue increase anticipated at lower end of corridor (+3 %) * Revenue for the first six months down 1 % year-on-year at EUR359.8 million * EBIT at prior-year level of EUR11.9 million, consolidated earnings improve by 13 % * Agreement for sale of Gustavsberg property (Sweden) signed in June 2013 Revenue down slightly on previous year The Villeroy & Boch Group generated net revenue of EUR359.8 million in the first half of 2013, down 0.9 % on the previous year's figure of EUR363.2 million. Net revenue on the German market was up 6.2 % year-on-year at EUR103.3 million. Revenue generated outside Germany amounted to EUR256.5 million (previous year: EUR265.9 million). The global economy saw inconsistent development in the first half of 2013. While there was a slight upturn in Asia, the United States and Germany, economic development in the euro zone markets that are important to Villeroy & Boch continued to deteriorate as a result of the unresolved sovereign debt crisis and the associated uncertainty concerning the financial policy of the countries affected. In Central Europe, the impact of adverse weather conditions also led to a slump in construction activity and a further slowdown in employment. EBIT stable, consolidated earnings improved The Villeroy & Boch Group reported earnings before interest and taxes (EBIT) of EUR11.9 million as at the end of the first half of the year, the same as in the prior-year period. Consolidated earnings improved from EUR4.5 million to EUR5.1 million (up 13.3 %). Agreement signed for sale of Gustavsberg property (Sweden) The agreement for the sale of the Gustavsberg property (Sweden) was signed in June 2013. The property will be sold in several tranches subject to the legal approval of the development plan required for the construction of residential units by the Swedish investor Ikano Bostad. In accordance with the terms of the contract, revenue is expected to be recognised in the 2013 and 2014 financial years. The total income may amount to up to EUR17 million. The recognition of the first instalment is expected in the fourth quarter of this year. Development in the divisions The Bathroom and Wellness Division generated revenue of EUR234.0 million in the first half of 2013, down 4.6 % or EUR11.3 million on the same period of the previous year. This development was primarily due to the impact of the euro zone financial crisis and the sustained winter weather in Europe and Russia. The latter factor had an adverse effect on the construction industry in terms of both new building and renovation activity. Examples include the downturn in revenue in Russia (-29.0 %) and the Netherlands (-15.4 %). By contrast, Sweden saw positive revenue development (+13.4 %), while revenue performance in Germany was stable with growth of 0.7 %. Factors including the higher level of taxation on the sale of property led to a slowdown in project business in China, resulting in a downturn in revenue of 14.8 %. The establishment of a dedicated warehouse in China is planned in order to help the development of retail business in the country. Meanwhile, Australia enjoyed encouraging revenue performance (+28.7 %). In North America, the establishment of a distribution network for the sales partnership with TOTO USA developed according to plan. The downturn in revenue in the US (-43.8 %) was primarily attributable to the sale of the St. Thomas Creation brand. The lower level of revenue in Mexico (-28.8 %) was largely due to the targeted withdrawal from low-margin local project business in the previous year. The Tableware Division generated revenue of EUR125.8 million in the reporting period from January to June 2013, and was therefore up EUR7.9 million or 6.7 % on the previous year. This positive development was driven in particular by the revenue growth of 18 % in Germany. Reasons for this included the good performance of new products such as 'Mariefleur Gris' and 'Cooking Elements', the successful intensification of promotional and impulse business, and the opening of additional retail stores. Outside Germany, the markets of Eastern Europe (+24.3 %), Russia (+22.2 %), Switzerland (+12.6 %), Austria (+10.4 %) and the UK (+6.8 %) saw particularly strong revenue growth. The downturns in the first quarter of the current year were more than offset in Italy (+1.6 %) and almost offset in Spain (-0.7 %) in the second quarter. Lower revenue was recorded in Australia (-4.0 %) and France (-2.7 %). Investments The Villeroy & Boch Group invested EUR4.2 million in the first six months of the 2013 financial year (previous year: EUR11.2 million). EUR2.9 million or 69 % of this related to the Bathroom and Wellness Division. We expect investments for 2013 as a whole to amount to EUR26 million as a result of postponements. Outlook for the 2013 financial year 'The fact is that given our ambitious targets, we cannot be satisfied with our revenue performance. However, we had planned in advance that the first six months would be affected by the difficult economic environment. Our performance is therefore in line with our expectations, albeit at the lower end of the range,' said Frank Göring, CEO of Villeroy & Boch AG. 'We are still assuming that revenue will be up for 2013 as a whole. However, this growth will be at the lower end of our previously forecast corridor, namely 3 %. In operative EBIT we are still projecting an increase that will be significantly above our forecast revenue growth, i.e. more than 5 %,' emphasised Göring. The revenue and earnings targets will be achieved with continued intensive investments in high-growth markets (particularly in Asia) and sales measures in the saturated markets of Europe. The rationalisation of production and in workflows and structures in the areas of administration, logistics and sales will also continue. Please find the complete Interim Report as a PDF-file for download here: http://www.villeroy-boch.com/en/gb/home/the-company/investor-relations/rep orts.html Further inquiry note: Almut Kellermeyer Head of Presse & Public Relations Tel: +49(0)6864 81-1397 Fax: +49(0)6864 81-21397 Mail: presse@villeroy-boch.com End of Corporate News --------------------------------------------------------------------- 18.07.2013 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: Villeroy & Boch AG Saaruferstraße 1-3 66693 Mettlach Germany Phone: +49 (0)6864 81-0 E-mail: information@villeroy-boch.com Internet: www.villeroy-boch.de ISIN: DE0007657231 WKN: 765723 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 221728 18.07.2013

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