DGAP-News: Villeroy & Boch AG / Key word(s): Quarter Results Villeroy & Boch AG: Villeroy & Boch kicks off 2014 financial year with strong revenue and earnings growth 22.04.2014 / 08:00 --------------------------------------------------------------------- Press Release Mettlach, 22 April 2014 Interim report on the first quarter of 2014 Villeroy & Boch kicks off 2014 financial year with strong revenue and earnings growth * Revenue for the first quarter up 5.1 % year-on-year at Euro 193.0 million * EBIT up 13.9 % year-on-year to Euro 8.2 million * Growth and earnings targets for 2014 as a whole confirmed Revenue development: +5.1 % year-on-year In the first three months of the 2014 financial year, the Villeroy & Boch Group generated net revenue of Euro 193.0 million, up Euro 9.3 million or 5.1 % on the same period of the previous year. Net revenue generated on the German market increased by 8.7 % year-on-year to Euro 59.0 million, while revenue outside Germany rose by 3.6 % to Euro 134.0 million (previous year: Euro 129.4 million). The economic recovery in the industrialised nations continued in the first quarter of 2014. Reflecting the trend in Germany, economic output is now also growing in a number of other euro zone countries on the back of increased private consumption. China and some emerging economies saw weaker development in the period under review, while economic performance in the USA was adversely affected by the unusually cold weather. Operating result (EBIT) improves by 13.9 % Operating earnings before interest and taxes (EBIT) amounted to Euro 8.2 million in the first three months of the current financial year, up Euro 1.0 million or 13.9 % on the same period of the previous year. Site development and property sale in Sweden continues The reorganisation and development of the Gustavsberg site in Sweden continued as planned. In the first quarter of 2014, expenses connected to the project had an adverse impact on earnings of Euro 0.6 million. EBIT adjusted for this extraordinary effect amounted to Euro 8.8 million, up 22.2 % on the previous year. Meanwhile, a further purchase agreement for the second tranche was signed on 2 April 2014. The corresponding revenue will be recognised in the second quarter. The total income from this real estate transaction is expected to amount to around Euro 17 million, of which Euro 7 million was already recognised in 2013. Development in the divisions In the first three months of 2014, the Bathroom and Wellness Division recorded revenue of Euro 123.8 million, up 5.8 % on the same period of the previous year (Euro +6.8 million). Germany enjoyed significant revenue growth (+8.7 %). This development was primarily driven by bathroom furniture, and in particular by the Sanipa brand. The division also recorded growth across all other product areas. Substantially higher revenue was also generated in Villeroy & Boch's important growth markets of China (+43.0 %) and Russia (+28.3 %), as well as in Eastern Europe (+17.6 %) and Sweden (+8.5 %). There was a downturn in revenue in the USA (-35.5 %), Italy (-21.7 %), Denmark (-15.1 %) and Mexico (-16.4 %) in particular. In the USA, this was primarily attributable to the disposal of the local second brand St. Thomas Creations in 2013. Negative revenue development in Mexico continued on the back of the difficult economic situation and a reluctance to invest due to the uncertainty affecting the local residential construction market. On the product side, Villeroy & Boch won major design awards in the Bathroom and Wellness Division, including the "red dot design award" for the "Architectura MetalRim" shower tubs and the "universal design award 2014" for the "Omnia Architectura" rimless DirectFlush WC. Also, Germany's most important trade fair for sanitation and craft trades, SHK, took place in Essen in March. Based on the response from customers, further positive revenue development is expected over the coming months. The Tableware Division generated revenue of Euro 69.2 million in the period from January to March 2014, up Euro 2.5 million or 3.7 % on the previous year. Germany was the main driver of this revenue growth (+7.6 %). An upward trend was also observed in a number of other countries, with the division recording significantly higher revenue in Poland (+20.9 %), Austria (+15.3 %) and Benelux (+8.0 %). The Tableware Division also enjoyed substantial revenue growth in the Middle East (+50.5 %), particularly in Saudi Arabia. Lower revenue was recorded in Australia (-15.5 %) and Italy (-8.9 %) in particular. The presentation of new products at the "Ambiente" trade fair in Frankfurt and other international trade fairs met with an extremely positive response. Good overall development is expected in light of the incoming orders that have already been placed for the 2014 Christmas collection. In terms of new products, the "Artesano Provençal", "La Classica" and "Anmut Flowers" collections have proved to be especially popular. This is also reflected in the initial orders and revenue that are being generated at present. In addition, activities in the division are concentrating on the further intensification of its range of gift items and gift sets. Outlook for the 2014 financial year "We are delighted with the positive start we have made to the new year - particularly because both of the divisions contributed to our revenue growth in Germany and our foreign markets alike," commented Frank Göring, CEO of Villeroy & Boch AG. Villeroy & Boch is still forecasting moderate economic growth for 2014 as a whole, although the as yet unforeseeable developments in Ukraine and the impact they will have are a cause for concern. Göring: "The imposition of further economic sanctions by the EU and the USA and the resulting backlash could have an adverse effect on revenue and earnings in our growth market of Russia as well as in Europe generally." The outlook for the 2014 financial year remains unchanged after the first quarter. "We are maintaining our forecast of growth in consolidated net income of between 3 % and 5 %. We expect to see above-average growth in operating earnings, i.e. an improvement of more than 5 % compared with the previous year," Göring confirmed. Please find the complete Interim Report as a PDF-file for download here: http://www.villeroyboch-group.com/en/investor-relations/reports.html Further inquiry note: Annette Engelke Head of Press & Public Relations Tel: (+49) 6864 81-1397 Fax: (+49) 6864 81-71331 Mail: [email protected] End of Corporate News --------------------------------------------------------------------- 22.04.2014 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: [email protected] Internet: www.villeroy-boch.de ISIN: DE0007657231 WKN: 765723 Indices: SDAX Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, Hamburg, München, Stuttgart End of News DGAP News-Service --------------------------------------------------------------------- 263836 22.04.2014