Steinhoff International Holdings N.V. : Steinhoff continues to see good sales momentum
31 August 2017
Steinhoff continues to see good sales momentum
Amsterdam, The Netherlands, 31 August 2017 - Steinhoff International Holdings N.V. ("Steinhoff") today announced its sales trading update for the nine months ended 30 June 2017.
Group sales increased by 48% to EUR14.9 billion for the nine months ended 30 June 2017 (9MFY17) compared to the nine months ending 30 June 2016 (9MFY16).
Organic revenue (excluding acquisitions) increased by 8%, led by good growth in the European and African regions.
Commenting on the results, Markus Jooste, CEO of Steinhoff, said: "We are pleased to report that the group's organic sales momentum, as well as the integration and sales development of the acquired businesses are progressing well. Once again the group's sales growth is underscored by the resilience of the low-price, value and discount market segments in challenging consumer environments as well as the diversity of the group's sales mix across various geographies."
During the nine months under review, the group generated 52% (EUR7.7 billion) of sales in Europe, 27% (EUR4 billion) in Africa, 15% (EUR2.2 billion) in the United States of America and 6% (EUR1 billion) in Australasia.
European sales comprised of 73% (EUR5.6 billion) in the household goods division and 27% (EUR2.1 billion) in the general merchandise division. The acquisition of Poundland in the United Kingdom became unconditional on 30 September 2016, and consequently the business added EUR1.3 billion revenue for the nine months ended 30 June 2017, contributing to the 25% growth experienced in the European region. Excluding acquisitions the group increased organic European revenue by 1%.
Despite a challenging consumer environment in South Africa, good like-for-like sales figures were recorded by all group retailers, contributing to the generation of EUR4 billion revenue in the African region. The 10% constant currency growth translated to a 26% increase in euro-reported numbers as a result of the 15% strengthening of the rand against the euro in the period under review. The general merchandise business division in South Africa increased like-for-like sales by 7.4% and continued to gain market share in this region. The household goods business segment reported stable revenue in constant currency while the automotive division increased constant currency sales by 5%, in a particularly challenging market.
In the United States of America, the Mattress Firm acquisition became unconditional in September 2016 and was part of the group for the entire nine months under review. The business delivered a satisfactory performance, generating $2.4 billion in sales, translating into EUR2.2 billion of euro-reported revenue in the nine months ending 30 June 2017.
The group accelerated the implementation of its long-term strategy in the United States of America, resulting in the rebranding and restructuring of 40% of its store estate. The group also exited the restrictive supply arrangement with Mattress Firm's previous biggest supplier in April 2017. As reported at interim stage, these actions created short-term disruption in the business.
The Australasian region increased organic (excluding acquisition) sales by 9% to EUR761 million, supported by a 6% strengthening in the Australian dollar. The Fantastic Furniture group reported a strong set of results and added EUR189 million revenue, contributing to the EUR950 million of total sales generated in this territory.
The separate listing of the Steinhoff Africa Retail assets (STAR) on the JSE Limited in September 2017 will create a diversified listed retail company of significant size and scale with its roots in Africa. STAR will house all Steinhoff's African retail assets (excluding the automotive division).
The separation of Steinhoff's emerging and developed market retail businesses is a natural progression and will allow investors wishing to access the African growth story to invest directly into STAR.
Steinhoff will continue to be a controlling shareholder in the company, while STAR will continue to leverage off Steinhoff's strategic, centralised sourcing, manufacturing and logistics expertise to maximise operating efficiencies across its retail operations.
The European household goods segment remains on track to deliver good operating profit growth for the twelve months ending 30 September 2017. Like-for-like sales in both Conforama and ERM returned to positive territory in July and August, following the traditionally slow third quarter under review.
In the United Kingdom, the furniture retail market is expected to remain challenging, while the resilience of the bedding retail market is expected to deliver modest growth.
The European and African general merchandise segments are expected to continue its current growth trajectory.
In the United States of America the disruption caused by the acceleration of the long-term strategic plan is now largely complete, with the business's focus returning to growth. Sales and margin in the US have continued to improve following the third quarter.
In Australia, the addition of Fantastic Furniture is proving highly complementary to the group's existing Asia Pacific household goods brands.
Additional information and the quarterly update are available in English via the following link: www.steinhoffinternational.com.
Additional information and the quarterly update are available in English on the company website using the following link: www.steinhoffinternational.com. If you would like to listen to the webcast at 15:00 CEST, the link is available on the company website.
Mariza Nel Investor Relations
Phone: +27 21 808 0711 Email: email@example.com
About Steinhoff International Holdings N.V.
Steinhoff is the world's third largest integrated household goods retailer by turnover, according to Möbelmarkt 2017, with more than 40 brands and 12 000 retail stores in more than 30 countries. Steinhoff retails, sources and manufactures household goods and general merchandise in Europe, the United Kingdom, the United States of America, Australasia and Africa. Retail operations are positioned towards price conscious (value) consumer segments, providing everyday products at affordable prices and serving customers at their convenience.
Our integrated retail divisions comprise:
- Household goods (furniture and homeware retail businesses)
- General merchandise focusing on clothing and footwear, accessories and homeware; and
- Automotive dealerships in South Africa which provide a broad range of new and pre-owned vehicles, parts, insurance, accessories and servicing.
Steinhoff employs approximately 130 000 employees and has a primary listing on the Frankfurt Stock Exchange and a secondary listing on the Johannesburg Stock Exchange with a current market capitalisation of approximately EUR17 billion.
Additional features:Document: http://n.eqs.com/c/fncls.ssp?u=UPUHWDGORUDocument title: Steinhoff Q3 2017
31.08.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.deLanguage: English
Company: Steinhoff International Holdings N.V. Herengracht 466 1017 CA Amsterdam
Netherlands Phone: +27218080700 Fax: +27218080800 E-mail: firstname.lastname@example.org Internet: www.steinhoffinternational.com ISIN: NL0011375019 WKN: A14XB9 Indices: MDAX Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange End of News DGAP News Service