Trading Statement for 2012/2013: Slight growth in consolidated sales
Hornbach withstands macroeconomic headwind
Sales at Hornbach Group up 0.8% to Euro 3.23 billion / Like-for-like sales at DIY and garden stores in Germany match previous year’s figure / Recession in Europe deals a blow to confidence among DIY enthusiasts in second half of year / Builders’ merchant business improves sales by 2.9%
Neustadt/Weinstrasse, March 21, 2013. The Hornbach Group (Hornbach Holding AG Group) slightly exceeded the previous year’s sales in the 2012/2013 financial year. Consolidated sales for the period from March 1, 2012 to February 28, 2013 increased by 0.8% to Euro 3,229 million, thus meeting the company’s own forecast.
As expected, Hornbach felt the effects of the recession in Europe in the second half of the financial year, and in particular in the final quarter of 2012/2013. This was reflected above all in a downturn in like-for-like sales at Hornbach’s DIY megastores with garden centers outside Germany. Like-for-like sales at stores in Germany, by contrast, matched the previous year’s record figure in 2012/2013 and gained further market share. Including sales at stores newly opened, the Hornbach-Baumarkt-AG subgroup, which was operating 138 DIY megastores with garden centers in nine countries across Europe at the balance sheet date, increased its total (net) sales by 0.6% to Euro 3,020 million. In the 2012 ranking of German DIY store operators by sales, the subgroup thus moved up one place to third position. Across Europe, Hornbach is now the fifth-largest DIY player.
The weakening in the Group’s sales performance in line with expectations was mainly due to faltering macroeconomic developments across large parts of Europe on account of the debt crisis. Given rising tax charges, shrinking real-term incomes, growing unemployment and a widespread feeling of insecurity, private households in numerous European countries significantly cut back their consumption in the course of 2012. This situation was exacerbated by cutbacks in housing construction and the real estate sector, a development which also left its mark on the DIY business. The real estate sector in the Netherlands, for example, where the full tax deduction of mortgage interest will no longer be possible in future, is undergoing a severe crisis. By contrast, Germany’s economic performance and consumer confidence levels were comparatively robust in 2012.
“Against this backdrop, we are satisfied with our business performance in 2012/2013 – even more so given that the basis for comparison is the very strong previous year”, commented Albrecht Hornbach, Chairman of the Board of Management of Hornbach Holding AG, with regard to the preliminary figures. “Not only that, we had to absorb substantial base effects that lay outside our influence.” On the one hand, sales momentum in the 2012/2013 financial year was negatively affected by unfavorable weather conditions in the first and fourth quarters compared with the previous year. On the other hand, depending on the country in question there were up to four business days fewer than in the previous year.
Net sales at the DIY stores with garden centers in Germany increased by 0.7% to Euro 1,741 million in the 2012/2013 financial year (previous year: Euro 1,729 million). On a like-for-like basis, i.e. excluding sales at stores newly opened and closed in the past twelve months, Hornbach’s stores in Germany upheld the previous year’s excellent level. In the 2011/2012 financial year, the domestic stores had generated like-for-like sales growth of 5.8% - the highest figure since 1996. “Our German stores once again posted a rock solid performance. Our like-for-like sales were around one-and-a-half percentage points ahead of the competition in 2012. That enabled us to increase our market share in Germany from 9.2% to 9.3%”, commented Hornbach.
The Hornbach Baustoff Union GmbH subgroup rounded off the Group’s pleasing performance in its home market. The 25 builders’ merchant outlets in operation at the balance sheet date boosted their sales in the 2012/2013 financial year by 2.9% to Euro 207 million.
Outside Germany, Hornbach improved its sales, including sales at three stores newly opened, by 0.6% to Euro 1,279 million in the 2012/2013 financial year. At 42.4%, the international share of sales remained unchanged at the Hornbach-Baumarkt-AG subgroup. Unlike in the domestic business, the weak macroeconomic climate clearly left its mark on the performance of Hornbach’s international store network, reaching countries that had still reported sales growth one year earlier. Net of currency items, Hornbach’s like-for-like sales outside Germany declined by 3.2% in the 2012/2013 financial year (previous year: minus 1.0%). At the Group as a whole, like-for-like sales slipped by 1.4% (previous year: plus 2.8%).
Based on initial preliminary earnings figures, the operating earnings of the Hornbach Holding AG Group for 2012/2013 are expected to amount to around Euro 145 million (previous year: Euro 169 million). The Hornbach-Baumarkt-AG subgroup is expected to post EBIT of around Euro 100 million (previous year: Euro 128 million). Details of the earnings performance and the annual financial statements will be presented at the Annual Results Press Conference on May 28, 2013.
“The figures at home and abroad show we are mostly more robust than our competitors when the economy begins to falter”, commented Hornbach. “We are confident about the future, as there is substantial demand for construction and renovation work in the countries where we operate. In Germany, for example, many buildings will have to be renovated in coming years to improve their energy efficiency. Given our large range of quality products, specialist advice and project philosophy, we are better placed than others to benefit from this megatrend.“
|Preliminary key figures of Hornbach Holding AG Group |
Preliminary key figures of Hornbach Holding AG Group
|Net sales at overall Group||3,229||3,204||0.8|
|Net sales at Hornbach-Baumarkt-AG subgroup||3,020||3,001||0.6||-1.4|
|of which in Germany||1,741||1,729||0.7||0.0|
|of which in other European countries||1,279||1,272||0.6||-3.2|
|Net sales at Hornbach Baustoff Union GmbH subgroup||207||201||2.9|
|Number of DIY stores||207||134|
|Sales areas as per BHB (000 m²)||1,598||1,549|
|Average DIY store size (m²)||11,600||11,600|
*adjusted for currency items
Rounding up or down may lead to discrepancies between percentages and totals. Percentage figures calculated on basis of Euro 000s.
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