Bathroom Newsletter August 2011

Transcription

1 Bathroom Newsletter August 2011 International Market Strategy Topics BRG News Sweden Germany BAUHAUS Starts Online Business HORNBACH First Quarter Results Germany BAYWA Denies Rumours On Possible Acquisition Germany PRAKTIKER Opens Import Office In Hong Kong Ukraine Founders Of NOVA LINIA Exiting The Business UK HOMEFORM Administration Makes 557 Staff Redundant UK WOLSELEY Sells Two Businesses To SAINT GOBAIN Bulgaria IDEAL STANDARD-VIDIMA To Boost Production In 2011 International strategic market research and consultancy on building product and related markets

2 1 BAUHAUS SWEDEN Starts Online Business 1 st July 2011 Since spring 2011 BAUHAUS, the German DIY chain, has been represented in Sweden by an online shop. Insiders give various reasons for this move: all the main competitors in Sweden have an online shop, so that the pressure to open one was great. Previously, residents in the Northern part of Sweden could hardly be reached, because the 15 existing branches are located chiefly in the Southern part of the country; appreciable sales were being achieved online in Sweden. BAUHAUS Germany are also considering the introduction of an online shop, although appreciable sales are being achieved on the home market, especially in the stores themselves. The company also publishes a product catalogue of more than 1,100 pages complete with ordering options. Source: DIY Global 2 HORNBACH First Quarter Results 1 st July 2011 The HORNBACH GROUP (HORNBACH HOLDING AG GROUP) has begun the 2011/2012 financial year on a successful note. Driven by a substantial year-on-year rise in demand from HORNBACH customers, consolidated sales for the first three months of the financial year (1st March to 31st May 2011) rose by 11.1% to million (previous year: million). Earnings showed significantly disproportionate growth compared with sales. The Group's operating earnings thus increased by 33.1% to 79.3 million (previous year: 59.6 million). Net income for the period increased by 30.6% to 49.4 million (previous year: 37.8 million). The Group's sales and earnings performance was shaped by its largest operating subgroup, HORNBACH-BAUMARKT AG. Here, sales at the 92 DIY megastores and garden centers in Germany, grew by 10.7% to million in the first quarter of 2011/2012 (previous year: million). On a like-for-like basis and net of currency items, sales at the DIY megastores and garden centres improved by 7.7%. Including currency items, even like-for-like sales grew by 9.4%. The subgroup's EBIT surged by 35.5% to 67.2 million (previous year: 49.6 million). HORNBACH operated a total of 134 DIY megastores and garden centres across Europe with total sales areas of around 1,531,000 m² as of 31st May According to Albrecht Hornbach, Chairman of the Board of Management of HORNBACH HOLDING AG, renovation and construction markets had a revival, especially in Germany. Due to the pleasing economic climate and favorable weather conditions, the underlying business framework was even better than in spring 2010.

3 Germany contributed the greatest sales momentum in the first quarter. On a likefor-like basis, i.e. excluding sales at stores newly opened in the past twelve months, sales here grew by 11.9%. During the period under report, HORNBACH thus outperformed the German DIY sector average by more than seven percentage points. In other European countries, i.e. in the eight countries outside Germany where HORNBACH operates, the 42 international HORNBACH stores increased their unadjusted sales, including sales at one store newly opened in the Czech Republic (Plzen) at the end of May 2011, by 10.1% to million (previous year: million). Like-for-like sales grew by 2.3%, and by 6.2% including currency items. Here, a slight decline in like-for-like and currency-adjusted sales in Eastern Europe was offset by sales growth, at very pleasing levels in some cases, in West European regions. First-quarter sales at the HORNBACH BAUSTOFF UNION GMBH subgroup, a regional builders' merchant player, also showed marked growth, rising by 15.8% to 54 million (previous year: 46.7 million). Source: Euroinvestor 3 BAYWA Denies Rumours On Possible Acquisition 5 th July 2011 BAYWA AG, based in Munich (Germany), denies the rumours circulating within the stock exchange on BAYWA s alleged intentions to acquire DIY chain PRAKTIKER. PRAKTIKER s shares moved up by two percentage points, those of BAYWA moved downwards. According to BAYWA, the rumours have no foundation as the company has no interest in an acquisition. BAYWA has indeed reported that it seeks a strategic perspective for the building segment including construction material and DIY markets. This could include co-operations or joint ventures, but a solution with PRAKTIKER is not on the cards. Source: DIY Online 4 PRAKTIKER Opens Import Office In Hong Kong 6 th July 2011 The import office of PRAKTIKER AG started work in Hong Kong at the beginning of July after a setting-up phase of about 15 months. It functions as a procurement organisation trading under the name of PRAKTIKER GROUP BUYING HK LTD (PGB) and is taking on the sourcing of goods specifically from East Asia and other non-european countries as an independent purchasing agency. In the past responsibility for sourcing goods from East Asia for the entire PRAKTIKER GROUP lay with METRO GROUP BUYING (MGB), also based in Hong Kong, but the

4 service contract with MGB will be terminated on 31st December PRAKTIKER GROUP BUYING HK LTD is starting out with some 30 employees, though there should be around 70 when the final organisational stage is reached. Bernd Reissenweber, 55, is managing director and head of the import office. He previously worked for several years in Hong Kong as buying director of MGB. Source: DIY Global 5 Founders Of NOVA LINIA Exciting The Business 6 th July 2011 Oleg and Igor Shandar, the founders and minority stakeholders of NOVA LINIA, the DIY network for building materials, and who hold about 35% of the shares in the company, are negotiating their full exit from the business. At present, negotiations are being held with strategic and financial investors as they prepare to sell their shares. The Corporate Finance team of international financial services firm DELOITTE together with a team of GOLDEN GATE BUSINESS are acting as financial advisors for the planned transaction. NOVA LINIA has been one of the most successful business stories in Ukraine. Oleg and Igor Shandar started selling small packages of shares in At present, 65% of shares belong to DRAGON CAPITAL, an investment company, and EAST CAPITAL, an investment fund. NOVA LINIA currently has the second largest building materials network in Ukraine, currently operating 17 stores. NOVA LINIA s annual revenue exceeded $300 million in Source: Deloitte 6 HOMEFORM Administration Makes 557 Staff Redundant 7 th July 2011 A statement from DELOITTE said the company, which trades under the brands MOBEN KITCHENS, DOLPHIN BATHROOMS, SHARPS BEDROOMS and KITCHENS DIRECT, had "experienced significant difficulties due to the current economic climate, particularly in the kitchen and bathrooms market". HOMEFORM s other operations have been closed down, with the loss of 557 staff, although the administrators continue to market the brands for sale. 24 employees have been kept on while matters are finalised. HOMEFORM owner SUN EUROPEAN PARTNERS has bought back SHARPS BEDROOMS through a new company, SHARPS BEDROOMS LIMITED, safeguarding 627 jobs and ensuring customers who have paid a deposit for a

5 SHARPS bedroom will have those deposits honoured. As part of the transaction, 96 of HOMEFORM s 160 showrooms and concessions have been licensed to SHARPS BEDROOMS LIMITED, and the new business will be headquartered from the SHARPS factory at Bilston. Source: DIY Week 7 IDEAL STANDARD-VIDIMA To Boost Production In st July 2011 Bulgarian sanitary fittings and ceramics manufacturer IDEAL STANDARD-VIDIMA plans to increase its ceramic products output by 18% and to enhance productivity by 10% by the end of According to Vassil Kunev, Vice President of IDEAL STANDARD for Eastern Europe, this would involve a technological renovation of existing equipment rather than an entirely new investment. He said that the company plans no further investments in its Bulgarian unit this year and will focus on the development of its ceramics and fittings facilities. IDEAL STANDARD-VIDIMA, controlled by Belgium-based bathroom equipment manufacturer IDEAL STANDARD INTERNATIONAL, is in charge of the group's product supply and trade activities in Eastern Europe. The Bulgarian division currently employs more than 3000 people, while 80% of its production is sold abroad, with Western Europe and Russia being some of its major markets. Source: Sofia Echo 8 WOLSELEY To Sell Two Businesses To SAINT GOBAIN 25 th July 2011 Plumbing and heating products distributor WOLSELEY PLC agreed to sell its building materials distribution business in the UK, the BUILD CENTER, to French glass products company SAINT GOBAIN. WOLSELEY is also in exclusive negotiations with SAINT GOBAIN to sell BROSSETTE, its plumbing and heating distribution business in France. Total consideration for the two transactions is 310 million ( 354 million) in cash. WOLSELEY will receive a consideration of 145 million ( 165 million) on the disposal of BUILD CENTER. The BROSSETTE deal is expected to result in consideration of 165 million ( 188 million). The company said it will use the proceeds to pay off debt.

6 According to Ian Meakins, Chief Executive of WOLSELEY, these transactions were the last significant disposals planned following last year's strategic review. In the future, the group is going to focus investment in their strongest businesses in core markets including building materials and wood solutions in France and plumbing, heating, pipe, climate and associated businesses in the UK. In the fiscal year ended July 2010, BUILD CENTER generated revenue of 316 million ( 360 million) and trading profit of 1 million ( 1.1 million). In the 11 months ended 30 th June 2011, BUILD CENTER revenue was 294 million ( 335 million) and had a trading profit of 4 million ( 4.5 million). In the fiscal year 2010, BROSSETTE had revenues of 648 million ( 739 million) and a trading loss of 7 million ( 8 million). For the 11 months ended 30 th June 2011, revenue was 590 million ( 673 million) and had a trading profit of 5 million ( 5.7 million). WOLSELEY stated that the completion of the transactions may take several months. On 12 th July, WOLSELEY announced that it would sell its ELECTRIC CENTER business to EDMUNDSON ELECTRICAL, a distributor of electrical equipment to trade and industry in the UK. WOLSELEY plans to issue its fiscal 2011 results on 4 th October. Source: RTT News