Leifheit Aktiengesellschaft: Leifheit AG releases report for financial year 2019

Leifheit AG releases report for financial year 2019

• Group turnover in 2019 amounts to EUR 234.0 million, Group EBIT of EUR 9.9 million at upper end of forecast range
• AGM postponed due to corona crisis; dividend of EUR 0.55 per share proposed
• Focus on increased consumer advertising in selected markets
• Forecast 2020: Turnover growth of around 8%, EBIT between EUR 9.5 million to EUR 10.0 million (before effects of Corona crisis)

Nassau, Germany, 25 March 2020 - Leifheit AG, one of the leading brand suppliers of household products in Europe, today published its final results for the financial year 2019. In the past financial year, the Leifheit Group achieved a turnover of EUR 234.0 million, a slight year-on-year decrease (2018: EUR 234.2 million). In the domestic market of Germany, turnover declined slightly. By contrast, the Leifheit Group was able to record significant turnover growth in Eastern Europe and in non-European markets. Group EBIT stood at EUR 9.9 million in the reporting period and thereby at the upper end of the original forecast range of EUR 9 million to EUR 10 million. After deduction of taxes of EUR 2.6 million (2018: EUR 3.5 million), Leifheit achieved a net result for the period of EUR 5.8 million (2018: EUR 8.4 million).

Henner Rinsche, Chairman of the Management Board of Leifheit AG: "During the financial year 2019 we launched key strategic initiatives that we intend to continue systematically this year. In particular, we successfully tested TV campaigns on a small scale last year and launched a major TV campaign in our domestic market of Germany at the beginning of the year to reach even more consumers with our award-winning products. At the same time, our priority is to further improve cost structures along the entire value chain."

In what is by far the largest segment, Household, turnover rose from EUR 180.4 million in the previous year to EUR 182.0 million in 2019. The segment, which consists of the Leifheit brand, accounted for 77.8% of Group turnover. In the laundry care product category, Leifheit achieved significant turnover growth with drying products, thanks also to the positive effects of the trial TV campaigns conducted in Austria and the Czech Republic. This helped compensate for the decline in sales in the ironing and kitchen sectors.

In the considerably smaller Wellbeing segment, which comprises the Soehnle brand with its range of scales, health products and air treatment products, turnover remained stable at EUR 19.8 million (2018: EUR 19.9 million). The segment's turnover development was bolstered by the new range of kitchen scales.

In the Private Label segment, the Group with its French subsidiaries Birambeau and Herby recorded a turnover of EUR 32.2 million (2018: EUR 33.9 million). This development can be attributed especially to the ongoing weakness of individual trading partners in France. At the same time the segment showed strong growth in Central Europe and the UK, which slowed the overall decline in turnover slightly.

In implementing its growth strategy, Leifheit can continue to build on a solid capital structure. As of 31 December 2019, Leifheit achieved a Group liquidity of EUR 50.3 million. Equity stood at EUR 96.2 million as of 31 December 2019, a decrease of EUR 5.6 million compared to the previous year's balance sheet date. Accordingly, the equity ratio stood at 44.8% at the end of financial year 2019 (2018: 45.9%).

In view of the corona crisis the Management Board decided to postpone the Annual General Meeting scheduled for 20 May 2020 to a later date. The postponement of the AGM also results in a delay of the AGM's resolution on the dividend proposal for the 2019 financial year and the payment of the dividend. Despite the significant uncertainties about the possible effects of the corona crisis, the Management Board of Leifheit AG will propose a dividend of EUR 0.55 per eligible share to the AGM, thus continuing its shareholder-oriented dividend policy.

For the 2020 financial year, the Management Board anticipates a turnover growth of around 8%, with all three segments expected to contribute to growth. The strategy is centred on the expansion of the core business especially with the Leifheit brand, which the company aims to drive forward with effective TV campaigns. Leifheit will use the gross profit generated as a result of the planned growth to strengthen consumer advertising. As a result, the Board of Management expects EBIT of around EUR 9.5 million to EUR 10.0 million, or roughly on par with the 2019 figure.

Henner Rinsche, CEO of Leifheit AG, says: "In 2020, we will continue to focus on expanding our business with the Leifheit and Soehnle brands. That will entail the promotion of consumer communication for our high-margin, European-made core products. We will also be expanding the trade distribution of our products. The spread of the coronavirus will have a significant negative impact on the economy. We made the forecast for the 2020 financial year before possible effects of the corona crisis. However, considering the dynamic developments of the corona pandemic, we are currently unable to estimate its impact on Leifheit's further business development. Leifheit got off to a good start in the 2020 financial year, particularly with the Household segment."

The complete annual financial report 2019 of the Leifheit Group can be downloaded 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 Leifheit Group divides its operating business into the Household, Wellbeing and Private Label segments. Leifheit and Soehnle products - two of Germany's best-known brands - are known for high quality and great utility for consumers. Its French subsidiaries Birambeau and Herby are also active in the service-oriented Private Label segment with a selected product range. In each segment, the company focuses on its core areas of expertise in the product categories of cleaning, laundry care, kitchen goods and wellbeing. The Leifheit Group employs some 1,100 people and operates 15 locations and branches of its own around the world. Leifheit AG shares have been listed on the regulated market (Prime Standard) of the Frankfurt Stock Exchange since 1984. More information on Leifheit is available online at www.leifheit-group.com, www.leifheit.de and www.soehnle.de.