Total Group revenue up nearly 13 per cent and a significant improvement in cash position
PARIS, 2016-May-30 — /EPR Retail News/ — Darty plc today announces fourth quarter trading for the period 1 February 2016 to 30 April 2016, based on unaudited management accounts.
Summary
- Continued market outperformance in France with like-for-like sales up 16.0 per cent, aided by vision switchover in April
- Positive like-for-like sales in Belgium for the fourth consecutive quarter
- ‘Confiance 4.0’ plan delivering strong results in terms of growth initiatives and multi-channel development
- Continued focus on working capital resulted in average net debt for the quarter reducing by over €140 million compared to the same quarter last year. Net debt at the end of the year was €115 million lower than last year at €108.8 million
Q4 revenue change (3 months to 30 April)
| Total** | Like-for-like* | |
| France | 16.2% | 16.0% |
| Belgium and the Netherlands | 0.3% | (0.9)% |
| Total | 12.8% | 12.0% |
*excluding Mistergooddeal.com
**including Mistergooddeal.com
Régis Schultz, Chief Executive, commented:
“We saw an exceptional sales performance in France during the quarter as our service credentials made us the reference retailer for customer advice on the television switchover. As a result, we continued to outperform the market in France with Darty’s like-for-like sales up 16 per cent and Belgium delivered a fourth successive quarter of positive like-for-like sales.
“Our ‘Confiance 4.0’ plan is delivering positive results through our multi-channel and franchise growth, cost initiatives and a significantly improving cash position.”
Group
Total Group revenue was up 12.8 per cent and up 13.5 per cent excluding Mistergooddeal.com. Like-for- like sales increased by 12.0 per cent. Sales were particularly strong in vision driven by the switchover in France but we also saw positive sales in all other major product categories apart from multi-media, where the market remained weak.
Our web-generated sales continued to grow, up 14.4 per cent excluding Mistergooddeal.com, now representing over 16 per cent of total product sales. Underlying group gross margin was down around 160 basis points for the period with very strong vision sales resulting in a less favourable product mix. Mistergoodeal.com then had a negative impact of around 20 basis points and there was a dilutive impact of around 40 basis points from the franchise business.
France
Darty (excluding Mistergooddeal.com) continued to outperform the market, with total revenue up 17.2 per cent and like-for-like sales up 16.0 per cent driven by the vision switchover. The switchover impacted an estimated three million televisions, necessitating customers to either purchase a set top box or a new television. Darty was well prepared for this event, commencing a customer awareness programme towards the end of 2015 supported by dedicated technical assistants at its call centres. At the switchover deadline in early April, Darty sold over 8,000 set-top boxes, 3,000 HDMI cables and 800 new televisions every hour.
Darty’s web-generated sales grew over 17 per cent to represent close to 16 per cent of total product sales. This was driven by an over 50 per cent growth in click and collect sales.
Overall gross margin for France was down around 250 basis points, with underlying gross margin down around 190 basis points. We continued to grow the profitable franchise business with a further eight openings in the quarter to total 67 in France and opened an additional three overseas to total seven. The franchise operation had a dilutive impact of around 50 basis points on gross margin. Mistergooddeal.com had a negative impact of around 30 basis points on gross margin and whilst its revenue remains under pressure the business is at breakeven.
Belgium and the Netherlands
At Vanden Borre in Belgium and BCC in the Netherlands overall revenue was up 0.3 per cent and like-for- like sales were down 0.9 per cent. Web-generated sales continued to grow strongly, up nearly five per cent, to nearly 16 per cent of total product sales. Overall gross margin was down around 90 basis points.
Vanden Borre delivered a fourth successive quarter of positive like-for-like sales, with strong web sales, but continued to see some small gross margin pressure from competitive market conditions.
Gross margin was under pressure at BCC and whilst revenue was on an improving trend it continued to see some disruption from the warehouse IT system issues, adversely impacting profitability. A new system to resolve was implemented after the period end.
Financial position
Our cash enhancement programme delivered a further improvement in working capital with average net debt for the quarter reducing by over €140 million compared to the same quarter last year, resulting in the Group’s €225 million revolving credit facility being undrawn (30 April 2015: €40 million drawn). Year end net debt was down by €115 million at €108.8 million.
There will be a telephone conference call for analysts at 08.00 on 26 May 2016. Dial-in number: +44 (0) 20 3003 2666. A recording of this call will be made available after 10.00. Replay dial-in number: +44 (0) 20 8196 1998, Access Pin: 8973210#.
The Group will issue its Full Year Results on Thursday 16 June 2016.
Enquiries
Analysts
Darty plc
Simon Ward
+44 (0) 20 7269 1400
Media
UK
Finsbury
Jenny Davey
+44 (0) 20 7251 3801
France
Le Public Système
Ségolène de Saint Martin
+33 1 41 34 23 31
About Darty plc
Darty group is a leading multi-channel service led electrical retailer operating over 400 stores and websites in three European countries. It generated an annual turnover of over €3.5 billion in 2014/15 through its operations of Darty and Mistergooddeal.com in France, Vanden Borre in Belgium and BCC in the Netherlands. Its ordinary shares are listed with the UK Listing Authority and trade on the market for listed securities on the London Stock Exchange under the symbol DRTY.L. It is also listed on the NYSE Euronext Paris.
For further information, please visit the company’s website, www.dartygroup.com.
Certain statements made in this announcement are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from any expected future results in forward looking statements. Unless otherwise required by applicable laws, regulations or accounting standards, Darty plc does not undertake any obligation to update or revise any forward looking statements, whether as a result of new information, future developments or otherwise.
APPENDIX
Store numbers as at 30 April
| 2016 | 2015 | |
| France | 221 | 222 |
| Franchises* | 74 | 43 |
| Total France | 295 | 265 |
| Belgium and the Netherlands | 137 | 135 |
| Group Total | 432 | 400 |
*Includes 67 stores in France (2015:39) and 7 overseas (2015:4)