DGAP-News: Gigaset AG: Despite a fall in revenue Gigaset improves EBITDA
(firmenpresse) - DGAP-News: Gigaset AG / Key word(s): Quarter Results
Gigaset AG: Despite a fall in revenue Gigaset improves EBITDA
11.11.2013 / 08:01
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Despite a fall in revenue Gigaset improves EBITDA
- EBITDA from continuing operations in the third quarter: EUR3.8 million
(Q3/2012: EUR -8.5 million ).
- Consolidated revenue from continuing operations in the second quarter:
EUR76.6 million (Q3/2012: EUR90.4 million).
- Capital measures placed successfully. Proceeds of EUR42.9 million.
Prospect of further funds.
- Business Customers Business Unit almost doubles revenue compared with
the third quarter of 2012.
- CEO Charles Fränkl: 'Market trends in our core business remain
challenging, which underscores just how necessary the efficiency
program is. We are making quick and good progress with implementing it.
However, it's also clear that we have to push ahead more intensively
with the strategic restructuring we've initiated. We'll also have to
invest significantly in new business segments to enable us to grow
again in future.'
Munich, November 11, 2013. As forecast, Gigaset AG was able to
significantly improve its operating income (EBITDA) in continuing
operations in the third quarter by EUR12.3 million to EUR3.8 million. That
was attributable in particular to successful implementation of the
cost-cutting and efficiency program launched in 2012. It has enabled costs
to be reduced by EUR22.6 during the course of the year. The program is
expected to unfold its full effect and produce savings of EUR30 million in
2014.
Due to the sharply declining market in the company's core business and the
revenue that was obtained in the second quarter and so earlier than usual
as a result of the Sales Push Program, revenue from continuing operations
fell to EUR76.6 million. The program became necessary in order to adapt
cash inflow better to seasonal liquidity requirements in the summer months,
when revenue is weak.
Despite the difficult market climate, Gigaset was again able to grow its
market share in its core business. Its market share increased over the
previous year by 2 percent both in terms of units sold and revenue.
Gigaset's market share in Europe in terms of revenue rose from 34 percent
in the third quarter of 2012 to 35 percent in the third quarter of this
year. That means Gigaset has outperformed the market for more than six
quarters, is in its view a clear winner from the market's consolidation and
has further strengthened its market position in Europe. As a premium brand,
Gigaset was also able to achieve prices that were 23 percent above the
market average. However, the market as a whole remains under strong
pressure. It declined year on year by around 15 percent in terms of units
sold and by 17 percent in terms of revenue.
Gigaset CEO Charles Fränkl commented on the quarterly figures: 'Market
trends in our core business remain challenging, which underscores just how
necessary the efficiency program is. We are making quick and good progress
with implementing it. However, it's also clear that we have to push ahead
more intensively with the strategic restructuring we've initiated. We'll
also have to invest significantly in new business segments in future.'
Together with Goldin Fund Pte. Ltd., the strategic investor that has now
taken a stake in Gigaset, the company aims to penetrate the tablet and
smartphone market. According to observers, the tablet market is three times
larger and the smartphone market 15 times larger than that for DECT.
Unlike the market for cordless phones, the smartphone market grew by 14
percent, and the tablet market even surged by 60 percent, year on year in
the third quarter 2013. Gigaset will soon launch its first tablet
computers.
Gigaset AG's figures in the second quarter of 2013 (continuing
operations)1:
- Consolidated revenue: EUR76.6 million (Q3/2012: EUR90.4 million)
- EBITDA: EUR3.8 million (Q3/2012: EUR -8.5 million)
- EBITDA margin: 5.0 percent (Q3/2012: -9.4 percent)
- Consolidated net loss: EUR3.8 million (Q3/2012: EUR13.3 million)
- Free cash flow: EUR -9.9 million (Q3/2012: EUR -8.0 million)
The Gigaset Group's cash and cash equivalents at September 30, 2013, were
EUR17 million. The capital measures announced together with an investor
agreement with Goldin Pte. Ltd. on September 27, 2013, have generated gross
total proceeds of around EUR42.9 so far for Gigaset AG. On the basis of the
investor agreement, the Gigaset Group has also held out the prospect of
further funds to establish the new business segment for tablet computers,
smartphones and other mobile end-user devices.
Rigorous implementation and further development of the 'Gigaset 2015'
strategy
The company is implementing the 'Gigaset 2015' strategy rigorously and
successfully.
Home Networks - 'Gigaset elements'
After the safety starter kit of Gigaset elements, consisting of two
intelligent DECT ULE-based sensors - the door sensor 'door' and the motion
sensor 'motion' - as well as the base station 'base' and an app for
smartphones were shipped to selected customers back in July, sales via the
wide-ranging network of specialty retailers and online began in Germany.
The first step toward internationalization of the innovative smart home
solution was taken with the launch of Gigaset elements in France in
October. The distribution rate is now being expanded successively and sales
underpinned by a marketing campaign.
Gigaset has added the window sensor 'window' and the alarm siren 'siren' to
the portfolio for the system, which can be extended in a modular fashion.
Additional components and extensive solutions in the fields of energy,
climate and elderly care are planned in future.
Gigaset elements defines a new market and goes beyond currently existing
product categories. The safety starter kit addresses the issue of the sharp
increase in the burglary rate in Germany. Gigaset elements offers a
solution here that is easy to install, low-cost and so suitable for the
mass market.
Consumer Products - 'Gigaset'
Gigaset has continued the review of its non-European activities with the
aim of focusing on highly profitable markets. The company continued its
withdrawal from the unprofitable cordless phone business in Brazil. The
subsidiary responsible for the Middle East and Africa region was sold to
management there and merged with one of Gigaset's large customers.
As part of its announced product drive, Gigaset launched four new models
for various application areas in the third quarter, underscoring its role
as the forerunner in DECT cordless telephony.
Rollout of the Android-based SL930A full-touch phone in Germany means
customers can enjoy the benefits of a smartphone in addition to the
convenience of fixed-network telephony. The Android 4.0 interface permits
quick and easy access to the Google Play Store directly via the router.
More than 975,000 apps are available from Google Play. The SL930A is the
first step toward new and highly promising cloud-friendly products. The
range of Android-based systems will soon be expanded.
Rollout of the first products from the 'adjacent products' segment was
prepared by communication measures. Three baby phone variants in three
different price categories were presented as part of an Internet campaign.
With its new models, Gigaset offers high-quality baby phones for every need
and is applying its experience and expertise in integrating baby phones in
telephones to the field of standalone systems for the first time.
The consumer portal 'testsieger.de' awarded Gigaset the title 'Premium
Manufacturer 2012' in the category 'Telephones' as part of a large-scale
study at the start of the third quarter. The title 'Premium Manufacturer'
is only bestowed on companies with the very highest standards of quality
and whose products are tested regularly in trade publications and fare
above-average. Gigaset has now been awarded the 'Premium' seal of quality
in the 'Telephones' category for its constant and high-class achievements
in the past years.
Business Customers - 'Gigaset pro'
The Business Customer Business Unit with the Gigaset pro brand has further
established itself on the market in the third quarter. Revenue was grown
further and almost doubled year on year thanks to a portfolio tailored to
specific target groups and selective sales and marketing measures.
The range of products and services was also developed further in the third
quarter. Gigaset pro and AudioCodes have jointly created a solution that
enables Gigaset pro N720IP DECT multicell telephone systems to be used in
Microsoft Lync environments. It supports a wide range of features for
communication at enterprises. This solution now means that cordless calls
are possible anytime, anywhere - at the company and throughout its campus -
in Lync installations as well.
In September, the R630H pro was launched, a new business phone whose
ruggedness makes it suitable for companies with employees who work outside
traditional office rooms. The R630H is certified in accordance with
protection class IP65, i.e. is particularly dust- and splash-proof and has
the additional advantage of impact resistance.
In France, Gigaset pro was voted the best manufacturer of SIP-based
end-user devices in a survey of resellers.
Outlook confirmed
Gigaset AG sticks to the outlook it gave at its annual press conference on
March 28, 2013.
The measures required to ensure long-term growth were initiated in 2012. To
counter the continuing difficulties in the company's core market,
investments in establishing new, promising business segments and product
groups are required. Gigaset AG therefore expects from continuing
operations in the current fiscal year:
- A further decline in revenue in its core business in a high
single-digit to low double-digit percentage range.
- EDITBA to improve sharply year on year and presumably to be positive
again thanks to the positive impact expected from the efficiency
program
- A negative free cash flow in around the middle double-digit million
range due to the investments required
For 2014, Gigaset AG expects initial and significantly positive effects on
revenue, earnings and cash flow from establishment of the new business
segments. The company therefore assumes that its revenue from continuing
operations will grow and its EBITDA will improve further in the course of
2014.
http://blog.gigaset.com.
Gigaset AG, Munich, is an internationally operating company in the area of
communications technology. The Company is Europe's market leader in DECT
telephones. The premium supplier ranks second worldwide with around 1,400
employees and a market presence in around 70 countries.
Gigaset AG is listed on the Prime Standard of Deutsche Börse and so is
subject to the very highest requirements for transparency. Its shares are
traded on the Frankfurt Stock Exchange under the symbol 'GGS' (ISIN:
DE0005156004). DE0005156004.
Contact:
Gigaset AG
Stefan Zuber, Corporate Communications Kerstin Diebenbusch, Investor
Relations
Phone: +49 (0)89 444456-866 Phone: +49 (0)89 444456-937
E-mail: info.presse(at)gigaset.com ' E-mail: info(at)gigaset.com
End of Corporate News
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11.11.2013 Dissemination of a Corporate News, transmitted by DGAP - a
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The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Gigaset AG
Hofmannstraße 61
81379 München
Germany
Phone: +89444456937
Fax: +89444456930
E-mail: kerstin.diebenbusch(at)gigaset.com
Internet: www.gigaset.com
ISIN: DE0005156004
WKN: 515600
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, München,
Stuttgart
End of News DGAP News-Service
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238979 11.11.2013
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