net turnover up by 6% at € 1.05 billion, on the back of strong growth in e-bikes and e-MTBs for sports and recreation in particular;
operating result excluding exceptional income and expenses came in 5% higher at € 65.9 million;
net profit, at € 32.3 million, was at the same level as in 2015; earnings and proposed dividend1per share came in at € 1.26 and € 0.72 respectively. This represents a pay-out ratio of 57%;
working capital decreases to 29.2% of turnover;
the ROCE increases to 12.2%;
refined strategy, with new objectives for the medium term; with a clear focus on consumers and profitable growth in e-mobility, (e-)bike sports and recreation;
the group financing arrangement was extended and expanded with a renewed five-year facility of
€ 375 million in total. This provides continuity of the financing at improved terms.
KEY FIGURES(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Net turnover | 1,048 | 986 | +6.3% |
Added value | 30.0% | 31.7% | |
Operating result excluding one-off gains and charges | 65.9 | 62.5 | +5.4% |
EBIT-margin | 6.3% | 6.3% | |
Net profit | 32.3 | 32.3 | +0.0% |
Working capital | 29.2% | 34.2% | |
Free cash flow | 61.3 | (31.2) | |
ROCE | 12.2% | 11.0% |
1 Optional dividend subject to the approval of the General Meeting of Shareholders to be held on 25 April 2017
René Takens, CEO Accell Group: "We reached a milestone in 2016. For the first time in its history, Accell Group realised turnover in excess of € 1 billion. One of the main drivers of this turnover record was the constantly growing contribution from e-bikes and bikes in the higher segment of the market in particular. We are clearly benefitting from our leading position in the field of e-bikes, which recorded turnover growth of 33% and now represents 41% of our total turnover. Turnover in e-performance bikes increased by 70% in the year under review. Germany is the biggest driver behind the turnover growth. We are also seeing an increase in turnover from e-bikes in North America. There too we are market leader with our brands, including Haibike, in what is still a limited market with a large number of suppliers. The position of the Raleigh brand among specialist retailers in North America continued to decline in 2016, and we have therefore decided to distribute the brand via multiple channels. Consumers can now buy our products both via specialist retailers and online. Turnover in bicycle parts and accessories in Europe remains stable, and our own XLC brand is constantly gaining ground.
Our profit was impacted by lower margins on the sales of older bicycle collections, the fact that we did not charge on higher currency exchange rates and two major bankruptcies of multi-sports chains in North America. We see these bankruptcies as confirmation of changes in how consumers are choosing to shop. This change in behaviour played a key role in our decision to refine our strategy, in which we are focussing firmly on consumers. We will use an omni-channel approach to market our products and services in a way that forms the best possible fit with the purchasing preferences of individual consumers.
Working capital decreased significantly and we are seeing the benefits of a more centrally-managed supply chain on this front. We expect to be able to further reduce our working capital in the coming years.
Cycling will continue to be popular for mobility purposes, recreational and sports use in the years ahead. We expect to be able to maintain our lead thanks to our high-quality products, plus we expect to be able to add innovations to make cycling for various purposes even more attractive. Based on these trends, we expect to see a continued increase in turnover and operational results in 2017, barring unforeseen circumstances."
GROUP PERFORMANCE(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Net turnover | 1,048 | 986 | +6.3% |
Added value | 314.8 | 313.0 | +0.6% |
As a % of turnover | 30.0% | 31.7% |
The added value (net turnover less material costs and inbound transport costs) came in at 30.0%. The absolute value was 0.6% higher at € 314.8 million. The changed sales mix and a different geographical distribution of turnover had an impact on the added value. The added value was also negatively impacted by higher dealer discounts and the fact that we did not fully charge on higher materials prices (due among other things to unfavourable currency exchange rates) to customers.
(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Staff costs | 121.8 | 122.9 | -0.9% |
As a % of turnover | 11.6% | 12.5% | |
Other operating costs | 122.3 | 122.8 | -0.4% |
As a % of turnover | 11.7% | 12.5% |
The decline in the number of bicycles sold and the effects of reorganisations resulted in a drop in staff costs. Staff costs as a percentage of turnover declined to 11.6%, from 12.5%. The operating costs also dropped; as a percentage of turnover, other operating costs fell to 11.7%, from 12.5%. The decline in other operating costs was partly due to a lower sales volume and was realised despite higher marketing and consultancy costs. The higher consultancy costs were largely related to organisational changes in the supply chain and external support for the refinement of the group strategy. In 2016, Accell Group invested in a more integrated management approach. As part of that drive, Accell Group strengthened the competencies at group level in areas such as Supply Chain, Marketing, HR and Finance.
The increase in turnover and (relative) decline in costs led to an increase in operating result (excluding one-off charges) of 5% to € 65.9 million. One-off charges in 2016 related to North America and resulted from the bankruptcies of two major sports chain and the effects of the sale of our parts & accessories activities, including the associated reorganisation and the buy-out of pension obligations. The combined one-off charges came in at € 5.5 million in 2016 (2015: € 4.0 million, as a result of the Taiwan incident).
(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Financial expenses (net) | 8.3 | 9.1 | -8.8% |
Taxes | 20.4 | 16.2 | +25.6% |
Tax rate | 38.7% | 33.5% | |
Net profit | 32.3 | 32.3 | 0.0% |
(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Net turnover | 785.5 | 719.0 | +9.3% |
Segment result | 56.4 | 56.5 | -0.3% |
The changed sales mix and a change in the geographical distribution, as well as more cut-price sales and the one-off charges in North America all had a negative impact on the segment result.
Parts & accessories(in € million unless otherwise stated) | 2016 | 2015 | Δ |
Net turnover | 262.6 | 267.4 | -1.8% |
Segment result | 17.5 | 15.6 | +12.0% |
The segment result of these trading activities increased by 12% to €17.5 million on the back of good results in all European countries where we are active. The greater contribution from our own XLC brand (in Europe) to overall turnover also had a positive impact on the higher segment result, thanks to the more effective utilisation of procurement benefits.
Accell Groep NV published this content on 10 March 2017 and is solely responsible for the information contained herein.
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