DGAP-News: Villeroy & Boch AG: Villeroy & Boch improves operating result by 8.0 %

In the first nine months of the 2017 financial year, the Villeroy & Boch Group increased its revenue by 1.7 % year-on-year on a constant currency basis, i.e. assuming unchanged exchange rates against the previous year. Revenue increased by 1.4 % in nominal terms to EUR 602.7 million.
Revenue in Germany was down slightly on the previous year at EUR 175.6 million (-0.7 %), while revenue outside Germany rose by 2.2 % to EUR 427.1 million.
Orders on hand amounted to EUR 119.9 million as at 30 September 2017, a significant increase of EUR 46.0 million as against 1 January 2017. Orders on hand in the Bathroom and Wellness Division reached another new record high of EUR 102.9 million.
 

Operating EBIT increased by EUR 1.8 million or 8.0 % to EUR 24.4 million in the first nine months of the financial year. Including the non-recurring income of EUR 0.1 million (previous year: EUR 1.2 million) generated from the real estate project in Gustavsberg (Sweden), EBIT totalled EUR 24.5 million (previous year: EUR 23.8 million).

At EUR 417.6 million, revenue in the Bathroom and Wellness Division in the first three quarters of 2017 was up 5.6 % on the same period of the previous year. Revenue increased by 6.0 % on a constant currency basis, with the main negative exchange rate effects resulting from the pound sterling and the Swedish krona. 
In Germany, the steady growth path recorded in recent years continued, thanks among other things to strong demand for bathroom furniture (+2.6 %). The outstanding revenue growth in China (+52.7 %) was driven by rising sales in all product segments. In the Gulf states, revenue increased by 46.1 % on the back of project business with hotels and restaurants. Significant revenue growth was also generated in Norway (+13.3 %) and Finland (+12.0 %). By contrast, revenue declined in France (-5.6 %) and the United Kingdom (-8.4 %). The latter was attributable to exchange rate effects, with revenue increasing by 0.9 % on a constant currency basis. 
The Tableware Division generated revenue of EUR 185.1 million in the 2017 financial year to date, down 7.1 % on the same period of the previous year. Revenue declined by 6.7 % on a constant currency basis, with the main negative exchange rate effects resulting from the development of the pound sterling in particular. 
Among other things, revenue development in the Tableware Division was affected by the ongoing strategy of focusing on higher-margin trade channels in particular while adopting a more cautious approach to discounts. Thanks to increased margins, however, the resulting downturn in revenue was reflected in EBIT only to a below-average extent.
In the core European markets, revenue declined in Germany (-7.8 %) and France (-4.0 %) in particular. In the United Kingdom, the weakness of the pound sterling meant that revenue fell by 6.8 % in nominal terms, whereas it increased by 1.8 % on a constant currency basis. Revenue fell by 7.2 % in the USA. Positive development was recorded in South Korea (+52.5 %) and the Gulf States (+10.9 %) in particular.

The Villeroy & Boch Group made investments totalling EUR 15.9 million in the first three quarters of 2017 (previous year: EUR 12.9 million). At EUR 12.4 million, three quarters of the investment volume related to the Bathroom and Wellness Division. Across both divisions, investments focused in particular on new production facilities and the optimisation of the logistics centres in Merzig and Losheim.

The Villeroy & Boch Group is anticipating an increase in consolidated revenue at the lower end of the forecast range of between 2 % and 3 % for the year as a whole. In terms of earnings, the Group is still expecting an increase of between 5 % and 10 % and is aiming for growth at the upper end of this range.