- Business Wire -
Groupe SEB’s reported sales for the first six months of 2008 rose by a robust 14.8% to €1,413.5 million.
Groupe SEB’s reported sales for the first six months of 2008 rose by a robust 14.8% to €1,413.5 million.
This performance reflected the net effect of three factors:
* A change in the scope of consolidation with the full integration, as from 1 January, of China’s Supor, which contributed €140 million to first-half revenue.
* A €41 million negative currency effect, exceeding the prior-year period’s negative €23 million, due mainly to the ongoing decline in the dollar.
* 6.7% organic growth at constant exchange rates and scope of consolidation (i.e. excluding Supor).
(in € millions) H1 2007 H1 2008 % change
Current
exchange rates Constant exchange rates
France 260.2 285.6 + 9.8 + 9.8
Other Western European countries 307.6 316.1 + 2.8 + 4.7
North America 172.4 170.3 - 1.2 + 11.1
South America 120.0 125.9 + 4.9 + 3.7
Central Europe, CIS and other countries 270.0 288.5 + 6.8 + 9.4
Asia-Pacific 101.1 227.1 + 124.6 +132.7
TOTAL 1,231.3 1,413.5 + 14.8 + 18.1
Rounded figures Percentages based on exact figures
For the third year in a row, Groupe SEB had a very good first half, shaped by solid organic growth despite a more mixed second quarter marked by a slowdown in a few European countries. Revenue growth was led by an increase in sales volumes, a further improvement in the product mix and firm prices.
The vast majority of product families contributed to this very satisfactory performance, with Dolce Gusto, Silence Force, Quick Cup, bread makers and other 2007 flagship products continuing to successfully expand in international markets.
Sales by region
In France, in a market that generally held up well in spite of a slowdown in the middle of the second quarter, Groupe SEB enjoyed very strong sales growth of nearly 10% for the period. Reflecting greater sales volumes, an improved product mix for small appliances, and higher cookware prices, this performance was driven by product innovations. Flagship products continued to show the way, led by the Actifry fryer (which achieved the Group’s highest market share ever), Dolce Gusto, bread makers, the Silence Force vacuum cleaner and new-model steam generators. All of these products were backed by powerful advertising campaigns that helped to boost sales.
In other Western European countries, overall sales growth was satisfactory, even if performance was more mixed than in first-half 2007, when sales rose by 3.4% at constant exchange rates. In a tougher environment, retailers focused on drawing down inventory, which slowed the Group’s second-quarter sales throughout the region. The decline in sales was especially noticeable in Germany because of very strong prior-year comparatives. Revenue was also lower in the Netherlands and Italy, reflecting the lacklustre economic context in both countries. Sales continued to trend upwards in Austria, Switzerland, Greece, Portugal and Spain, despite a slowdown in this specific country late in the half. In the United Kingdom, despite a still-challenging market environment, the Group reported a sharp increase in revenue, led by such flagship products as Actifry, Dolce Gusto and Quick’N Hot.
In North America, the Group enjoyed a very good first half, with sales up 7.0% at constant scope of consolidation and exchange rates. In Mexico, business remained very strong, in a buoyant market. In Canada, however, sales declined despite a slight recovery in the second quarter. In the United States, in a sluggish consumer market, the Group saw a sharp recovery, with sales rising by 4.3% at constant exchange rates. Growth was led by a significant upswing at T-fal, which is benefiting fully from its repositioning in the more high-end cookware segment, while Mirro WearEver now effectively fills the entry-level niche. Although All-Clad was unable to make up for its slow start to the year during the second quarter, Rowenta pursued its growth, with steam generator sales continuing to rise, while Krups improved its situation.
In South America, unfavourable weather conditions had a very adverse effect on fan sales in the first quarter, curtailing growth in Brazil and Colombia. The impact of this phenomenon lessened with time, and the Group’s performance was generally more favourable in both countries during the second quarter. Despite the strong real and its impact on low-cost imports from Asia, the Group’s sales picked up considerably in Brazil, increasing by nearly 5% at constant exchange rates in the second quarter. This performance was underpinned by both Arno, which reported higher sales of washing machines, vacuum cleaners, steam irons and personal care appliances, and Panex, which strengthened its positions. Sales were also buoyed by strong demand in Venezuela and in Argentina, where the Group made further inroads.
In Central Europe, CIS and other countries (Turkey and other countries in the Middle East and Africa), the Group’s 9.1% organic growth reflects robust sales in markets that remain fundamentally sound, despite creeping inflation. Groupe SEB has operated in these countries for a long time, establishing solid positions based on well-known brands that represent key drivers of future growth. This is especially true in Turkey, where after a mixed performance in 2007 due to the political and economic environment, business was back on track in the first half. In Central Europe and Russia, the Group also continued to develop rapidly, despite a few one-time problems with some retailers. Sales however declined in Saudi Arabia, due to difficulties with the Group’s import agent. A solution should be found within the next few months and business is expected to rebound.
In the Asia-Pacific region (China, Southeast Asia, Japan, South Korea, Australia, etc.), the Group’s sales doubled in the first half, while organic growth (excluding Supor) amounted to 10.9%. In Japan first-half sales were up slightly despite the weak yen, which had an unfavourable impact on business in this country. This represented a very satisfactory performance given today’s currency environment and the price increases introduced by the Group. Sales remained very strong in South Korea in spite of the decline in the won and were also very robust in Australia, New Zealand and Malaysia. In China, the trend remained very positive as Supor’s first-half sales in its domestic market rose by 37%. The increase was in line with the company’s excellent past results and far above overall market growth, thanks in particular to very strong demand for small electrical appliances.
The world leader in small domestic equipment, Groupe SEB operates in more than 120 countries with a unique portfolio of top brands marketed through multi-format retailing. Selling some 170 million products a year, it deploys a long-term strategy focused on innovation, international development, competitiveness and service to clients. Groupe SEB has 19,500 employees worldwide.