TAKKT grows organically and through acquisitions

DGAP-News: TAKKT AG / Key word(s): 9-month figures/Quarter Results

2015-10-29 / 07:30

TAKKT grows organically and through acquisitions

- TAKKT grows organically by 4.6 percent in first nine months of 2015, reported turnover increases by 8.6 percent

- Gross profit margin at 42.6 (42.8) percent

- EBITDA margin increased to 15.0 (14.5) percent

- Earnings per share of EUR 0.94 (0.78)

- Acquired companies Post-Up Stand and BiGDUG make first contribution to turnover in reporting period

Stuttgart, Germany, October 29, 2015. In the first nine months of 2015, TAKKT continued on a profitable growth path. After a cautious start to 2015 in Europe, business picked up slightly during the course of the year. Strong development continued in North America. Organic growth slowed somewhat there in the third quarter as expected due to the strong basis of comparison of the previous year. In the nine-month period of 2015, consolidated turnover increased organically by 4.6 percent (i.e., adjusted for currency, acquisition and divestment effects).

TAKKT was able to increase consolidated turnover by 8.6 percent to EUR 788.6 (726.1) million in the first nine months of 2015. In the third quarter, reported consolidated turnover increased by 10.9 percent to EUR 282.7 (254.8) million; at the same time, TAKKT grew organically by 4.6 percent compared to the previous year's quarter.

Felix Zimmermann, CEO of TAKKT AG, comments on the figures: "We are pleased by the good growth in the first nine months of the year. Along with good organic growth, other drivers of this development were the acquisitions of Post-Up Stand and BiGDUG, which contributed to the Groupʼs consolidated turnover for the first time in the previous quarters. We are well on our way to achieving the target goals that we set for ourselves for the current year."

At 42.6 (42.8) percent, the gross profit margin of the TAKKT Group was slightly below the previous year's level. This decline was partly attributable to TAKKT AMERICA's higher share of consolidated turnover due to the fact that its companies earn a structurally lower gross profit margin. Another contributing factor was the currency rebates in Switzerland. On the other hand, the phase-out of Topdeq and the sale of the Plant Equipment Group (PEG) had a positive effect on the gross profit margin.

Earnings before interest, taxes, depreciation and amortization (EBITDA) of EUR 118.6 (105.2) million in the first nine months of 2015 represent an increase of 12.7 percent over the previous year, and the EBITDA margin of 15.0 (14.5) percent was also considerably higher compared to the previous year. Of note here is the one-off positive contribution to earnings of EUR 3.3 million, resulting from the deconsolidation of PEG. Without this one-off gain, the EBITDA margin would have come to 14.6 percent. The TAKKT cash flow (defined as profit for the period plus depreciation and amortization, impairment of non-current assets and deferred taxes affecting profit and loss) amounted to a considerably higher EUR 86.8 (75.0) million in the nine-month period.

TAKKT EUROPE: First-time consolidation of BiGDUG
Compared to the previous year's period, turnover for the TAKKT EUROPE segment saw organic growth of 0.1 percent in the first nine months of 2015. Reported turnover increased by 1.6 percent to EUR 390.8 (384.7) million. One reason for the rather restrained organic development was the general investment reluctance in the Swiss market caused by the strength of the Swiss franc versus the euro. Turnover in local currency declined significantly there, due also in part to currency rebates. The Packing Solutions Group (PSG) division recorded organic turnover growth in the low single-digit percentage range in the reporting period. Performance of the Business Equipment Group (BEG) division showed a slight decline in organic turnover partly due to the fact that it is strongly influenced by economic conditions. As of the third quarter of 2015, BiGDUG contributed to division turnover for the first time. In the third quarter, BiGDUG achieved mid-single-digit organic turnover growth compared to pro forma figures from the previous year's period. The segment's EBITDA decreased to EUR 69.2 (74.1) million and the EBITDA margin to 17.7 (19.3) percent.

TAKKT AMERICA: Strong development continues
Organic turnover growth of the TAKKT AMERICA segment in the reporting period was 10.4 percent. Even without PEG turnover, reported turnover in euros was still 16.5 percent above the previous year's period with EUR 398.0 (341.6) million, which was mainly attributable to the strength of the US dollar. Organic growth for the Specialties Group (SPG) division was in the high single-digit percentage range, whereby in particular the Group company Central performed very well. The Office Equipment Group (OEG) developed very favorably with clear double-digit growth, which was also due to the good volume of business with federal institutions during the reporting period. EBITDA for the segment increased to EUR 56.7 (39.0) million, and the EBITDA margin of 14.3 (11.4) percent represents a significant increase over the previous year's figure. However, the sale of the less profitable PEG business as well as the contribution of the Group company Post-Up Stand as of the second quarter of 2015 also need to be taken into account here. After adjusting for the one-time gain earned from the deconsolidation of PEG, the EBITDA margin for the segment would have been 13.4 percent.

Outlook: TAKKT refines annual forecast
Given the development of GDP volumes, as well as the market and industry indexes, TAKKT expects a stable development in Europe as well as continued good business performance in the US. The TAKKT Management Board believes that the most likely scenario for 2015 as set out in the 2014 annual report was confirmed in the reporting period. TAKKT CFO Claude Tomaszewski specifies the forecast for all of 2015: "For now, we anticipate a turnover growth of four to five percent. The EBITDA margin should be in the upper third of the target corridor of 12 to 15 percent, i.e., above the level of the previous year."

Conference call
We would like to invite you to address your questions to the Management Board. We will be hosting a conference call for this purpose at 3:00 p.m. (CET) on October 29, 2015. To take part, please dial the following number: +49 69 2222 3250 (access code: 779134#).

Financial calendar
TAKKT will publish the preliminary figures for the 2015 financial year on February 18, 2016.

IFRS figures for TAKKT Group for the first nine months of 2015:
(in EUR million)

Change in %  
Change in %
TAKKT Group turnover 282.7 254.8 10.9 788.6 726.1 8.6
Organic growth     4.6     4.6
TAKKT EUROPE 131.6 122.2 7.7 390.8 384.7 1.6
TAKKT AMERICA 151.1 132.6 14.0 398.0 341.6 16.5
EBITDA 40.2 36.2 10.9 118.6 105.2 12.7
EBITDA margin (%) 14.2 14.2   15.0 14.5  
EBIT 33.0 29.6 11.6 98.3 85.6 14.9
EBIT margin (%) 11.7 11.6   12.5 11.8  
Profit before tax 30.6 26.3 16.3 91.4 76.6 19.4
Pre-tax profit margin (%) 10.8 10.3   11.6 10.5  
TAKKT cash flow 27.7 24.4 13.5 86.8 75.0 15.7
TAKKT cash flow margin (%) 9.8 9.6   11.0 10.3  

TAKKT is the leading B2B direct marketing specialist for business equipment in Europe and North America. The Group is represented with its brands in more than 25 countries. The product range of the TAKKT subsidiaries comprises more than 200,000 products for the areas of plant and warehouse equipment, office furniture, transport packaging, display articles, equipment for retailers, the food service industry and the hotel market.

The TAKKT Group has over 2,000 employees and just under three million customers worldwide. The company is listed on the SDAX and Deutsche Börse Prime Standard.

Dr. Christian Warns Tel. +49 711 3465-8222
Giuseppe Palmieri Tel. +49 711 3465-8250

Email: investor@takkt.de

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