Villeroy & Boch: Bathroom and Wellness division continues to drive growth in 2018
The German group posted revenue of 853.1 million euros (+2%) and 7.6% growth in EBIT. The Bathroom and Wellness division performed strongly while the Tableware division saw a decline.
Villeroy & Boch (Mettlach, Germany), one of the most important international groups in the ceramic sanitaryware and tableware sectors, posted consolidated revenue of 853.1 million euros in the 2018 financial year (up 2% on 2017 or 2.8% on a constant currency basis) along with a 7.6% improvement in EBIT to 53.6 million euros.
These positive results were driven by the Bathroom and Wellness division, which generated more than two-thirds of the group’s revenues (584.3 million euros, up 4.7% from 2017 or 7.3% on a constant currency basis), offsetting the contraction in the Tableware segment (down 4.4% to 266.2 million euros).
The Bathroom and Wellness division’s sales in the domestic European market remained almost unchanged with respect to 2017 at 453.7 million euros (+0.4%). The UK experienced a decline in revenue partly as a result of the weakness of the pound (-7.3%), whereas Southern Europe enjoyed an outstanding revenue performance (+7.6%) and revenue in Germany continued to rise (+1.3%). Demand was much stronger outside Europe, where revenue increased by 22.8% overall to 130.1 million euros. The Asia-Pacific region again achieved strong growth (+33.4%), passing the 100-million-euro mark for the first time. China contributed greatly to this with a 31.5% surge in revenue.
The decline in revenue in the Tableware division was influenced by a range of factors, including the transition towards new distribution models in various markets, changes in the pricing and discount policy and optimisation of the store network. Revenue in Europe declined by 4.7% but increased in the US by 3.7% on a constant currency basis (-0.4% in nominal terms). Intensified e-commerce sales and marketing activities increased online revenue by 9.2% across all markets, with e-commerce activities now accounting for around 17% of the Tableware Division’s total revenue.
Investments in property, plant and equipment and intangible assets amounted to 43.6 million euros in the past financial year. The Bathroom and Wellness Division accounted for the majority of these investments (37.7 million euros or 86.5%), focusing on the acquisition of new production facilities for ceramic sanitaryware plants in Germany and abroad. The remaining 5.9 million euros was invested in new production facilities for the Tableware Division and optimisation of its retail network.
For the current year, Villeroy & Boch’s CEO Frank Göring expects to see growth of between 3% and 5% in consolidated revenue and EBIT.