Economic crisis weighs heavily on TAKKT Group key figures
(Thomson Reuters ONE) - Adjustment of cost structures shows signs of successStuttgart, Germany, 30 July 2009. The global economic crisis hasresulted in a sharp decline in turnover for the TAKKT Group in thefirst half of 2009. As expected, the 24.3 percent decrease in salesrevenue in comparison to the same period last year also resulted in adrop in operational profitability. The EBITDA margin fell to 11.0percent. In view of the current level of demand, the management haslaunched the FOCUS and GROWTH programmes, which are designed tooptimise the allocation of resources within the Group and promotegrowth initiatives.Major events in 2009 * Adjusted for currency and acquisition effects, a 29.5 percent decline in turnover * Gross profit margin up; EBITDA margin of 11.0 percent * FOCUS and GROWTH programmes launched * Acquisition of the leading US mail order group for restaurant equipmentManagement opts for cost optimisation and targeted expansionThe TAKKT management has initiated two programmes of measures inresponse to the current crisis in demand. Namely FOCUS, which willreview the existing and potential value contribution of the Group'sactivities, and GROWTH, which will pool and prioritise growthinitiatives. One of the most significant FOCUS measures is thedecision to close down Topdeq's US-based activities by 31 December2009. The business has been unable to live up to the long-termbusiness volume and response rate expectations since it wasestablished in 2000, also due to the development of the US dollar. Asthe Management Board does not expect any change in the underlyingbusiness conditions for Topdeq in the USA in the medium to long term,the Topdeq division will henceforth focus on its profitable Europeanactivities.Meanwhile in the K + K America division, the number of warehouses forthe Plant Equipment Group will be reduced from four to three, asimproved shipping networks in the USA now mean that deliveries can bemade to the customers almost just as quickly and reliably from threeas from four locations.In KAISER + KRAFT EUROPA, the Estonian marketing approach is to beoverhauled, in view of the limited size of the market and the currenteconomic developments in the Baltic States. The customers there willin future be serviced by a marketing partnership with a localretailer, rather than by a TAKKT sales company. A similar businessmodel has been used successfully in Slovenia since 2007.These measures will be responsible for one-off expenses in the secondhalf-year 2009 of around EUR 1.5 million in 2009. The ManagementBoard nevertheless anticipates that these measures will make apositive earnings contribution of more than EUR 2 million per annumwith effect from 2010.As part of the GROWTH programme, the KAISER + KRAFT EUROPA divisionwill use additionally the brand name "certeo" to market office andbusiness equipment to business customers via the internet only. It isdue to be launched in Germany in October 2009 and plans for aEuropean roll-out are already in preparation.Furthermore, business dealings with customers in the service sectorare set to be expanded as part of GROWTH. "We have put our foodservice activities on a firm foundation thanks to the acquisition ofCentral Restaurant Products (Central) in April and the furtherexpansion of Hubert within Europe," explained Dr Felix A. Zimmermann,who succeeded Georg Gayer as CEO on 01 June 2009. Following thesuccessful launch of Hubert in Germany, the second most importantEuropean market, namely France, will now likewise be represented byits own sales company there from autumn 2009.Further initiatives within the FOCUS and GROWTH programmes arecurrently being reviewed in detail and the results will be announcedin due course. The Management Board intends to have completed all theFOCUS initiatives by the end of 2009.TAKKT Group hit by economic crisisThe TAKKT Group achieved turnover of EUR 358.3 (2008: 473.2) millionin the first half of 2009, representing a year-on-year decline of24.3 percent. Adjusted for acquisition and currency effects,consolidated turnover fell by 29.5 percent. Zimmermann commented onthe results of the first six months of the year as follows: "Thesignificant reluctance of our customers to make investments in thefirst half of the year can be interpreted as a sign of the ongoinguncertainty concerning the economic outlook. At present, we see nosigns of any sustainable economic recovery."The TAKKT Group's gross profit margin rose to 42.3 (41.9) percent.Adjusted for acquisition effects, the margin increased to 42.5percent thanks to improved purchase prices. As expected, EBITDA(earnings before interest, tax, depreciation and amortisation) fellas a result of the sharp decrease in business in the first sixmonths, from EUR 76.3 to 39.5 million, which amounts to an EBITDAmargin of 11.0 (16.1) percent. The drop in profits caused the cashflow to decrease from EUR 55.3 to 29.6 million, which resulted in acash flow margin of 8.3 percent.Turnover and income in the first and second quarters can only becompared to a limited extent. "A comparison of the first two quarters2009 is limited, mainly due to the lower number of working days inthe second quarter as well as a change in the way in which cataloguesare recorded in the balance sheet, which has caused an unequaldistribution of advertising expenses," explained CFO Dr FlorianFunck. Irrespective of this, the measures to adapt capacityutilisation and costs to the economic situation were furtherintensified in the second quarter, which is for example shown byclear reduction in personnel expenses excluding the acquisition.KAISER + KRAFT EUROPA records sharp drop in turnoverThe turnover of the biggest and most profitable division, KAISER +KRAFT EUROPA, fell by 33.1 percent to EUR 189.6 (283.2) million inthe first half of the year. EBITDA was down from EUR 63.8 to 32.0million and the EBITDA margin fell to 16.9 (22.5) percent, primarilyas a result of reduced capacity utilisation and a drop in advertisingefficiency. Turnover developed negatively across the board. Thehardest hit regions were those that had been developing exceptionallywell in previous years, such as Eastern Europe.Topdeq business remains weakTopdeq, the specialist for design-oriented office equipment, suffereda further significant fall in turnover of 30.7 percent down to EUR29.4 (42.4) million in the first half-year. This downward trend wasmost pronounced in the US market. Adjusted for the positive currencyeffects of the Swiss franc and the US dollar, the organic drop inturnover was 32.1 percent. EBITDA fell to EUR -0.9 (2.9) million,resulting in an EBITDA margin of -3.1 (6.8) percent. Profitabilitywas stifled both by the decline in advertising efficiency due to theeconomic climate and by reduced capacity utilisation of the mailorder infrastructure.K + K America strengthens its position with Central takeoverOf the three business divisions, K + K America fared the best in thefirst half of 2009, with a decline in turnover of 17.9 percent to USD185.8 (226.2) million. The initial consolidation of Central had apositive effect on turnover. But even when adjusted for the effectsof this acquisition, the division still developed slightly betterthan the rest of the Group with a minus of just 24.3 percent, thanksto its more diverse customer structure and broader product portfolio.When translated into the reporting currency of the euro, turnoverfell by a mere 5.6 percent to EUR 139.6 (147.9) million. EBITDA fellfrom EUR 14.8 to 12.1 million and the EBITDA margin was 8.7 (10.0)percent. Central's higher operational profitability had a slightlypositive effect on the division's margin. Disregarding Central, K + KAmerica had an EBITDA margin of 8.4 percent.2009 turnover forecast revised - profitability scenarios confirmedAs a result of the business development in the first half-year, theManagement Board has revised the range of its turnover forecast, fromthe original 15 to 25 percent drop in organic turnover to a fall of20 to 25 percent. It has also confirmed the profitability scenariowhich foresees that, even with a decline in organic turnover of about25 percent, operational profitability before extraordinary effectswould only be just under ten percent.Conference callWe invite you to directly address the Management Board with yourquestions. We will be hosting a conference call for this purpose at15:00 (CEST) on 30 July 2009, during which we will be open toquestions. To take part, please dial the following number: +49 7119659-9628 (access code: 779134#).IFRS figures for the TAKKT Group at the end of Q2 2009in EUR million Change Change Q2 2009 Q2 2008 in % H1 2009 H1 2008 in %Turnover TAKKT Group 171.9 232.7 -26.1 358.3 473.2 -24.3Organic growth -33.8 -29.5 KAISER + KRAFT 85.7 140.7 -39.1 189.6 283.2 -33,1 EUROPA Topdeq 13.0 20.1 -35.3 29.4 42.4 -30,7 K + K America (?) 73.3 72.2 1.5 139.6 147.9 -5,6 K + K America ($) 99.5 112.9 -11.9 185.8 226.2 -17,9EBITDA 12.6 33.2 -62.0 39.5 76.3 -48.2EBITDA margin 7.3 14.3 11.0 16.1EBIT 7.7 29.3 -73.7 30.5 68.8 -55.7EBIT margin 4.5 12.6 8.5 14.5Profit before tax 6.1 28.2 -78.4 27.5 65.9 -58.3Profit before tax 3.5 12.1 7.7 13.9marginCash flow 9.9 24.8 -60.1 29.6 55.3 -46.5Cash flow margin 5.8 10.7 8.3 11.7In order to make a valid comparison with the prior year, the prioryear's figures were restated under the revised IFRS regulations foradvertising expenditure.Short profile of TAKKT AGTAKKT is the leading B2B mail order specialist for business equipmentin Europe and North America. The Group is represented with its brandsin more than 25 countries. The product range of the TAKKTsubsidiaries comprises over 160,000 items from the areas business andwarehouse equipment, classical and design-oriented office furnitureand accessories, as well as equipment for retailers, the food serviceindustry and the hotel market.The TAKKT Group employs some 2,000 staff, has 3 million customersworldwide and distributes more than 60 million catalogues andmailings per year.TAKKT AG is listed on the SDAX and was admitted to Deutsche Boerse'sPrime Standard on 01 January 2003.Contact:Dr Felix A. Zimmermann, CEOTel. +49 711 3465-8201Dr Florian Funck, CFOTel. +49 711 3465-8207Email: investor(at)takkt.dehttp://hugin.info/131631/R/1331441/315032.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 30.07.2009 - 07:30 Uhr
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