Jul 22, 2013 - Emmen
ALSO Group: Strong result in the first half of 2013
Total net sales of the Group were 6.0 percent higher than those of the previous year. The Central Europe Market Segment compensated for the decline in the Northern/Eastern Europe Market Segment. Group net profit dropped from 19.9 million euros to 16.3 million euros. “Although the current market environment remains challenging, we reaffirm our goals for 2013 with our continuing efforts to increase profitability via improved processes and new services. This will enable us to further optimize our cost-efficiency and consistently take advantage of opportunities for profitable growth,” explained Gustavo Möller-Hergt.
Sound result in the second quarter of 2013
In the second quarter of 2013, Group net profit amounted to 5.6 million euros (previous year: 6.3 million euros), corresponding to a decline of 0.7 million euros. This was due primarily to non-recurring special costs for the restructuring in Finland in the amount of 1.4 million euros. Adjusted for this effect, the results for the second quarter would be above the level of the previous year.
IT Market
According to the market research institute CONTEXT, the IT distribution market declined in terms of value in the second quarter of 2013 by 4 percent compared to the previous year in the regions relevant to ALSO. The markets grew slightly in Austria and France, while those in Switzerland, Germany and particularly in Finland shrank drastically in terms of value. In Finland the demand for PCs declined again in the second quarter of 2013 and was significantly below the comparable period of the previous year at -15 percent. According to market research data from Electronics Wholesalers (Finland), the Consumer Electronic market also declined markedly by -16 percent in the first five months of the year under review.
Central Europe Market Segment
The Central Europe Market Segment posted net sales growth of 11 percent over the previous year: net sales rose to 2,280.5 million euros. Profit before tax (EBT) rose from 21.2 million euros to 27.9 million euros. In the first six months, the EBT margin increased up to 1.2 percent, well over the same period in the previous year. The continuing strong demand in the mobility segment (smartphones and tablets) also made a positive contribution to the result.
Northern/Eastern Europe Market Segment
In a difficult economic environment, ALSO achieved net sales of 759.7 million euros, down by 6 percent from the previous year. The decline is due primarily to the high proportion of retail sales. Profit before tax (EBT) dropped from 7.2 million euros to -1.4 million euros, while the EBT margin fell from 0.9 percent to -0.2 percent. The results in the Northern/Eastern Europe market segment were pressured by special costs of 1.4 million euros in conjunction with the restructuring in Finland. Due to the continuing market weakness and intense competition, the ALSO Group Management reacted early and adapted the cost structure of ALSO Finland both with regard to personnel as well as non-personnel costs to the lower business volume. Consequently, insufficiently profitable business activities were discontinued in May 2013 and the number of employees reduced by 75. At the same time, the introduction of SAP in mid-2012 was accompanied by potentials for increasing productivity. The effect of the savings will more than compensate for the restructuring costs in the second half of 2013.
Outlook for 2013
Overall, based on the restructuring measures introduced at an early stage in Finland, the focus on financial management and a strong fourth quarter expected with the holiday business, ALSO anticipates – excluding unforeseen circumstances – an overall result slightly below the level of the previous year. For the full fiscal year 2013, ALSO expects an EBITDA of 100 to 110 million euros, which – all other things being equal – should correspond to a Group net profit of between 38 and 45 million euros.
