Business news : Accell Group Forecast Flat Profits on Higher Sales in 2013

Accell Group expects sales in the second half of 2013 to grow across all its product groups and major countries, the company announced ealry Tuesday, Nov. 19. Europe's largest bicycle maker said it expects higher total and organic sales in 2013 compared to 2012 in a market it described as "stable or slightly decreasing." Operating profit, excluding restructuring charges, is expected to come in at approximately the same level as report in 2012.

“Developments in recent months show that the bicycle season has not really picked up in full following the bad conditions during spring, despite good weather in the summer months in most countries," said Accell Group CEO René Takens. “Therefore, there is no material impact of sales catching up and more products were sold at a discount at the end of the season than anticipated. Meanwhile, inventory levels have again normalized.

“As our dealers are also encountering the effects of a difficult season, less bicycles of the new model year are currently sold in pre-season sales; dealers are frequently moving orders to the spring,” Takens continued. “Nevertheless, Accell Group’s turnover will also increase in the second half of the year, which also demonstrates that even during slow economic times the underlying long term trends of more consumer interest for mobility, health and sports are structural. We expect turnover to increase organically in the full year 2013 compared to 2012 while margins will be lower. On an annual basis, operating profit is expected to come in at approximately the same level as in 2012.”

Accell’s sales of electric bikes and innovative sport bikes continue to develop well, while pressure on sales of traditional bikes has eased. The new bicycles collections for 2014, presented in September 2013, have been well received by the majority of dealers. Accell Group has introduced several innovations for electric bikes and sports bikes which are being received well in the market, as for example the different versions of the speed pedelecs (till 45 km/h) and the introduction of the electric SpartaMet.

Given the outlined developments and the current market outlook Accell Group expects a higher sales for the full year 2013 whereby the added value will be at a relative lower level mainly as a result of granted discounts. Operating costs as a percentage of turnover is at a similar level compared to 2012. Operating profit excluding restructuring charges is expected to come in at approximately the same level compared to 2012.

North American reorganization on track

The second half of the year will include a number of exceptional items regarding the earlier announced and deployed reorganizations for the Netherlands and North America this year. The reorganizations are on track. During the course of 2014 the integration of the bicycle production of Batavus and Sparta in the Netherlands will be completed. The production of bicycles in Canada ended in June, 2013 and by year end Accell’s U.S. businesses will be integrated. The related restructuring costs for the Netherlands and North America amount to a total of net €3.0 million in the second half of the year.

Net profit for the full year 2013 is expected to be below the level of last year due to higher financing costs, relative higher taxes and the earlier mentioned reorganization charges for the Netherlands and North America.

Accell has restored inventory levels to their 2012 levels through discounts and planning adjustments. Trade receivables had decreased as a result of lower than expected sales, while trade credits are lower due to lower production planning. The total trade working capital has decreased compared to 2012.

Taking into account the customary effects related to the development of the seasonal sales, no significant changes occurred in recent months regarding the financial structure of Accell Group. The seasonal nature of the activities generally results in a substantially lower profit in the second half of the year compared to the first half year.

About Accell Group : 

Based in The Netherlands, Accell Group focuses on the mid-range and higher segments of the market for bicycles, bicycle parts and accessories and fitness equipment. The company has leading positions in the Netherlands, Belgium, Germany, Italy, France, Finland, Turkey, the United Kingdom and the United States. In Europe Accell Group is market leader in the bicycle market in terms of revenue. Accell Group’s best known brands are Batavus (NL), Sparta (NL), Koga (NL), Loekie (NL), Ghost (Ger), Haibike (Ger), Hercules (Ger), Winora (Ger), Raleigh and Diamondback (UK, US, Canada), Lapierre (Fr), Tunturi (Fi), Atala (IT), Redline (US) and XLC (international).

By press release

More news about accell group ? Use the search engine at the right top.