2017.23.2 - Mārupe

ALSO Group announces new medium-term revenue and profit targets

ALSO is once again reporting record earnings for fiscal year 2016. Group net profit climbed 32.3 percent year-over-year to EUR 83.2 million. In the same period, the Group’s revenues increased 2.5 percent to EUR 8.0 billion. The Supply business contributed EUR 6.2 billion to total revenues, compared to EUR 6.0 billion in the previous year. Revenues from the Solutions business remained constant at EUR 1.5 billion while revenues from the Services business increased from EUR 212 million to EUR 220 million year-over-year. “We are gradually expanding our business with a focus on sustainable profit growth,” said Gustavo Möller-Hergt, CEO of ALSO Holding AG (SIX: ALSN).

In the medium term, ALSO aims to generate between nine and twelve billion euros in revenues, including revenues from acquisitions. The company’s target for the share of Solutions in total revenues will remain between 20 and 30 percent; for the Services segment, the company is targeting a range between five and ten percent. Moreover, ALSO is targeting an EBITDA margin between 2.0 and 2.5 percent of sales in the medium term. For 2017, ALSO once again expects profit gains to outstrip revenue growth.

In fiscal year 2016, earnings before taxes (EBT) rose by 25.4 percent year-over-year to EUR 113.9 million (1.4 percent of revenues); this result was supported by operational improvements, the reduction of depreciations and the elimination of one-off charges. EBITDA rose by 4.3 percent to EUR 146.0 million.

Central Europe market segment

EBT improved by 43.5 percent to EUR 90.7 million. This increase can be traced back to the implementation of ALSO’s strategy in France and Germany. In the same period, revenues decreased by 2.0 percent to EUR 4,992 million. In Germany, the company turned down a few high-volume orders in the retail sector for the sake of higher profitability. This was compensated in part by revenue gains in France and by the growth of ALSO Switzerland.

Northern/Eastern Europe market segment

EBT results amounting to EUR 23.2 million (previous year: EUR 35.4 million) include the effects of startup investments in the new markets in Poland and the Benelux countries as well as in the new ultramodern warehouse in Finland. Revenues increased by 14.2 percent to EUR 3,337 million. The increase can be traced in large part to acquisitions in Poland and the expansion in the Benelux countries.

The figures have been adjusted to account for last fiscal year’s reassignment of business in the Netherlands from the Central Europe market segment to the Northern/Eastern Europe segment.

Employees

In 2016, ALSO had an average of 3,524 employees from 50 countries, 125 less than in the previous year. Expenditures for personnel amounted to EUR 209.4 million in 2016, which represents a decrease of 1.3 percent compared to the previous year.

Investments and Acquisitions

ALSO’s investments and acquisitions amounted to EUR 17.0 million, compared to EUR 25.1 million in the previous year. The company deployed approximately EUR 3.7 million for acquisitions in 2016. The majority of the resources were used to increase ALSO’s stake in Bachmann Mobile Kommunikation AG in Switzerland.

Distribution to shareholders

The Board of Directors received an earnings appropriation proposal with a dividend amounting to CHF 2.25 per share entitled to a dividend, compared to CHF 1.90 in the previous year. The Board of Directors has agreed to this proposal and will submit it to the Annual General Meeting for approval. The Board of Directors of ALSO Holding AG continues to pursue a stable dividend policy and aims to pay a dividend of 25 to 35 percent.

Outlook

In the medium term, ALSO is targeting between nine and twelve billion euros in revenues and an EBITDA margin between 2.0 and 2.5 percent. The company intends to meet these objectives through an optimization of its business models, organic growth and/or acquisitions. In 2017, new business opportunities will emerge for ALSO given changes in the competitive structure. The expected revenue gains for the full year should thus exceed the 1.4 percent market growth predicted by Gartner. ALSO once again expects Group net profit gains to outstrip revenue growth.

Direct link to the media release: http://www.also.com/goto/20170223en

Direct link to the Annual Report 2016: www.also.com/goto/report2016