Leifheit Aktiengesellschaft: Leifheit continues sustained upward trend in 2016

P R E S S R E L E A S E

Leifheit continues sustained upward trend in 2016

- Turnover in Brand Business up by more than 4%

- EBIT rises to EUR 22.1 million

- Dividend increase to EUR 2.10 per share and special dividend of EUR 0.80 proposed

- Outlook for 2017: sustained turnover growth expected

Nassau, 29 March 2017 - The Leifheit Group continued its sustained upward trend and finished financial year 2016 with an increase in turnover and earnings (EBIT). Group turnover rose by 2.3% to EUR 237.1 million following EUR 231.8 million in the previous year. EBIT stood at EUR 22.1 million, compared to EUR 21.7 million in financial year 2015.

"Our 'Leifheit 2020' strategy already started bearing fruit in financial year 2015. Our upward trend continued in 2016. The consistent implementation of our strategy and the constant expansion of our product portfolio are having a sustained impact," says Thomas Radke, Chairman of the Board of Management of Leifheit AG.

Dynamic development continues in Brand Business

Turnover in Brand Business, which manages the Leifheit and Soehnle brands, reached EUR 195.8 million as at the end of the financial year, an increase of 4.1%. The continued positive development in Brand Business was attributable to strong demand for Leifheit-brand products, primarily in the category cleaning. As in the previous year, the double-digit growth in the e-commerce sales channel was a decisive factor in the development in Brand Business.

In line with expectations, turnover in the significantly smaller Volume Business was unable to match the previous year's growth and was down 5.7% year on year to EUR 41.3 million due to the base effect from the initial supply of a new retail customer in France in the second half of 2015 and the scheduled discontinuation of contract manufacturing for third parties. The postponement of Project Business, which was planned for the fourth quarter of 2016, also materialised.

Despite a considerable drop in foreign currency gains, the Leifheit Group is reporting a 2.2% rise in earnings before interest and taxes (EBIT) from EUR 21.7 million in 2015 to EUR 22.1 million. As in the previous year, the EBIT margin stood at 9.3%. Adjusted for foreign currency gains, EBIT increased by EUR 2.6 million, or 13,4%, to EUR 21.8 million; the adjusted EBIT margin gained roughly one percentage point, rising to 9.2%. Less taxes, the Leifheit Group's net result for the period climbed to EUR14.5 million following EUR 14.3 million in the previous year.

Leifheit reported Group liquidity of EUR 69.5 million as at 31 December 2016. The EUR 1.3 million rise in liquidity year on year was mainly due to cash flow from operating activities of EUR 21.8 million. Equity reached a high of EUR 104.6 million as at 31 December 2016 and therefore fell by EUR 2.1 million year on year. The main reason for the decline in equity was the special dividend of EUR 3.6 million, which was additionally distributed to shareholders in May 2016. As a result, the equity ratio stood at 43.7% as at the end of financial year 2016, having amounted to 44.9% as at the balance-sheet date in 2015.

"We are starting 2017 with a whole series of new, consumer-oriented products. They are the result of our innovation strategy and round out our established ranges to attract new target groups, tap into new markets and expand our market position," says Thomas Radke, Chairman of the Board of Management of Leifheit AG. "Our overarching goals remain to generate sustainable, organic growth, to attain high efficiency in the value chain and continually improve our operating result."

Capital increase to raise share liquidity planned

The Board of Management of Leifheit AG will propose to shareholders at the upcoming Annual General Meeting on 24 May 2017 a capital increase from the company's own funds at a ratio of 1:1. In doing so, the share capital is to be doubled from EUR 15 million to EUR 30 million by converting retained earnings. Every shareholder would therefore receive, without additional payment, one additional share (bonus share) for each Leifheit share held. The share of equity for every shareholder would remain unchanged. The measure will have no impact on the volume of the company's balance sheet equity. The new shares would be entitled to participate in profits from 1 January 2017.

"Not only did we succeed in remaining on course for growth last year, the Leifheit share also developed positively once again. The share price rose by more than 14% over the course of 2016. By way of the proposed capital increase, we intend to further increase the fungiblity of the share, making it even more attractive for current and new shareholders," says Dr Claus-O. Zacharias, CFO of Leifheit AG.

Dividend increase and special dividend proposed

Based on the positive business development, the Board of Management will also propose to the upcoming Annual General Meeting a further EUR 0.10 increase in the dividend to EUR 2.10 per share and in addition a special dividend of EUR 0.80. The dividend for financial year 2015 stood at EUR 2.00 plus a special dividend of EUR 0.75 per share.

Outlook for 2017: sustained turnover growth, earnings with one-off effects

The Board of Management of Leifheit AG continues to concentrate its efforts on the consistent implementation of the "Leifheit 2020" strategy, in particular by expanding Brand Business and tapping into new markets. Turnover growth of 3.5% to 4.5% is expected at Group level in 2017. In Brand Business, turnover is expected to increase by 4% to 5%. Turnover growth of 2% to 3% is planned in Volume Business, which is geared towards profitability.

With a view to strengthening future growth in Brand Business, the company intends to invest in the reorganisation of its sales structure in 2017. This will likely result in one-off effects that have already taken into account in the earnings forecast for the financial year 2017. Leifheit therefore expects earnings before interest and taxes (EBIT) in line with previous year.

Further information can be found in the Leifheit annual financial report 2016, which is available at financial-reports.leifheit-group.com.

About Leifheit

Leifheit AG, founded in 1959, is one of the leading European brand suppliers of household items. The company stands for high quality, innovative products with great utility and functional design in the sectors of cleaning, laundry care, kitchen goods and wellbeing. Leifheit and Soehnle are among the best-known brands in Germany. In addition to the Brand Business, Leifheit AG operates in the service-oriented Volume Business via its French subsidiaries Birambeau and Herby. The Leifheit Group and its international branches combined have around 1,000 employees. More information on Leifheit is available online at www.leifheit-group.com, www.leifheit.de, www.soehnle.de.