Hornbach Holding AG: Hornbach Group boosts sales by 4.3 percent to around Euro 3.4 billion

Trading Statement for 2013/2014:

Hornbach Group boosts sales by
4.3 percent to around Euro 3.4 billion

DIY megastores with garden centers achieve turnaround, posting like-for-like growth of 2.7 percent - Other European countries make up shortfall - Builders' merchant business increases sales by 4.1 percent

Neustadt/Weinstrasse, March 20, 2014.
Following a strong final push in the fourth quarter, the Hornbach Group (Hornbach Holding AG Group) increased its sales for the 2013/2014 financial year by 4.3 percent to Euro 3,369 million. Hornbach-Baumarkt-AG, the largest operating subgroup with 141 DIY megastores and garden centers in nine countries across Europe, improved its sales by 4.4 percent to Euro 3,152 million. After a poor start to the year due to weather conditions in the first quarter, Hornbach managed to significantly boost its growth rate compared with the previous financial year. Group-wide like-for-like sales net of currency items at DIY megastores with garden centers showed a turnaround, rising by 2.7 percent and thus contrasting with the 1.4 percent downturn reported for the previous year's period.

The increasing growth momentum seen in the course of the 2013/2014 financial year (March 1, 2013 to February 28, 2014) was driven in particular by the 92 Hornbach DIY megastores with garden centers in Germany. These boosted twelve-month domestic sales at the Hornbach-Baumarkt-AG subgroup by 5.0 percent to Euro 1,827 million. On a like-for-like basis, i.e. excluding stores newly opened or closed in the past twelve months, sales in Germany grew by 4.9 percent. The company thus expanded its domestic market share from 9.3 percent to 10.0 percent in 2013.

Germany: Significant growth in defiance of sector trend

"Following the spring freeze, that represents a very strong performance in Germany", commented Albrecht Hornbach, Chairman of the Board of Management of the Hornbach Holding AG parent company. "We generated substantial growth in the past year, and that despite the negative sector trend, and thus extended our head start over the sector in terms of like-for-like sales from one-and-a-half to around five percentage points." Hornbach attributes this above all to the company's consistent focus on project customers. Not only that, the company had successfully secured a share of the sales distributed among competitors from summer 2013 onwards in the wake of the Praktiker and Max Bahr insolvency.

Furthermore, the DIY business benefited from mild weather conditions. New construction and renovation projects witnessed virtually no winter break in the final quarter (December 2013 to February 2014). This factor also favored developments at the Hornbach Baustoff Union GmbH, whose 27 regional builders' merchants outlets improved their sales by 4.1 percent to Euro 216 million in 2013/2014.

Other European countries: Successful race to make up lost ground

Sales in other European countries also noticeably gained in momentum compared with the previous year. Including stores newly opened, DIY sales in the eight countries outside Germany grew by 3.5 percent to Euro 1,325 million. Given the stronger growth reported in Germany, the subgroup's international share of sales slipped from 42.4 percent to 42.0 percent. Over the financial year, Hornbach's international DIY megastores with garden centers made up for almost all of the weather-related shortfall seen in like-for-like sales net of currency items in the first quarter (twelve-month period: minus 0.1 percent).

According to company information, the end of the recession in Europe led to a gradual improvement in consumer confidence from spring 2013 onwards. "Consumers are once again willing to invest more cash in construction and DIY projects", remarked Albrecht Hornbach. Against this backdrop, the performance of the Hornbach stores in other European countries consistently improved from the second quarter of the financial year. "Compared with the previous year, we have seen an increase in the number of countries across our network reporting adjusted sales growth," added Hornbach.

Details of the earnings performance and the annual financial statements will be presented at the Annual Results Press Conference on May 27, 2014.
 

*adjusted for currency items
Rounding up or down may lead to discrepancies between percentages and totals. Percentage figures calculated on basis of Euro 000s.