Leifheit Aktiengesellschaft: Business development in the first half of 2022 impacted by challenging market conditions

Leifheit AG: Business development in the first half of 2022 impacted by challenging market conditions

• At EUR 136.3 million, Group turnover down on previous year’s record in the first six months of 2022 but still well above pre-coronavirus level
• Group EBIT of EUR 2.1 million in first half-year due to drastic increase in material and energy prices
• Forecast for 2022: strong decline in turnover in the single-digit percentage range, EBIT in the lower single-digit million range 

Nassau, 9 August 2022 – Leifheit AG (ISIN DE0006464506), one of the leading brand suppliers of household goods in Europe, generated Group turnover of EUR 136.3 million in the first half of 2022 despite numerous challenges in the market environment. Although this figure was 12.5% below the record value of EUR 155.8 million from the previous year, the company nevertheless achieved the second highest turnover in a first half-year and in a second quarter in the past 15 years on a like-for-like basis.

Earnings before interest and taxes (EBIT) in the first half of 2022 stood at EUR 2.1 million (previous year: EUR 13.6 million) and resulted mainly from the loss of contribution margins from the drop in turnover, as well as the drastic increase in material and energy prices, which could not be fully compensated for by sales price rises. Less taxes, this equalled a net result for the period of EUR 1.3 million in the first half of 2022 (previous year: EUR 9.5 million).

“The market conditions were anything but favourable for our company in the first six months,” says Henner Rinsche, Chairman of the Board of Management of Leifheit AG. “While the past two years were shaped mainly by the effects of the COVID-19 pandemic, other factors are increasingly having a significant influence on business development in 2022. Along with a continuous rise in production costs on account of the higher raw material and energy prices, the high inflationary pressure and uncertainty resulting from the Russia-Ukraine war are having a negative impact on consumer appetite. In light of these challenges and the ongoing bottlenecks in procurement markets, our focus is on safeguarding our ability to deliver through forward-looking inventory management and flexible production management. We also continue to focus on strict cost and resource management and are in continuous negotiation with our partners.”

In the Household segment, the Leifheit Group’s turnover decreased by 10.0% to a total of EUR 113.4 million in the first half of 2022 (previous year: EUR 125.9 million). The share of Group turnover accounted for by this segment amounted to 83.2% in the reporting period, compared to 80.8% in the previous year. In the Wellbeing segment, the Leifheit Group generated turnover of EUR 8.3 million (previous year: EUR 13.8 million), which corresponds to a significant decline of 40.0%. The share of Group turnover attributable to this segment decreased accordingly to 6.1% (previous year: 8.8%). The Private Label segment mainly distributes private-label brands through the French subsidiaries Birambeau and Herby. After strong growth in the same period of the previous year, turnover declined by 9.2% to EUR 14.6 million in the first half of 2022 (previous year: EUR 16.1 million).

“We expect to continue seeing extensive challenges for the Leifheit Group in the second half of 2022 as well. That won’t stop us from continuing the initiatives of our Scaling up Success strategy and seizing the opportunity to further promote the core qualities of our products,” Rinsche says in regard to the further implementation of the growth strategy in the current financial year. “We believe we stand to benefit from the trend towards more sustainable, energy-saving alternatives. In the face of rising energy prices, many households are currently looking for ways to reduce their electricity consumption and costs. Our durable laundry care products help them do just that. Switching from electronic dryers to drying racks like the Leifheit Pegasus and rotary dryers like the Linomatic saves electricity and money and helps reduce CO₂ emissions by around 150 kg per year compared to an electric dryer. Our ‘Stromsparer’, or ‘Electricity Savers’, campaign encourages consumers to switch to power-free laundry drying. We have also launched a new product in the kitchen category, the Leifheit Harmonic insulating jug, which allows consumers to actively save on money, electricity and packaging waste. The Harmonic combines high quality with modern design and keeps drinks hot for up to 24 hours at 65°C. A comparative test of various insulating jugs by ipi Institut für Produkt- und Marktforschung recently singled it out as ‘by far the best at preserving heat’.”

The Leifheit Group faces extremely high procurement costs and a deteriorating economic environment, along with inflation and consumer caution. In light of this, the Board of Management of Leifheit AG forecasts a strong year-on-year decline in Group turnover in the single-digit percentage range for the financial year 2022. It also expects earnings before interest and taxes (EBIT) in the lower single-digit million range.

Further information can be found in the financial report for the first half-year ending 30 June 2022, available at financial-reports.leifheit-group.com.

 
Electricity saver: Leifheit rotary dryer Linomatic 500

Leifheit Harmonic insulating jug - keeps drinks hot for up to 24 hours

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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 household brands – are known for high quality and great utility for consumers. Its French subsidiaries Birambeau and Herby are active in the service-oriented Private Label segment with a selected product range. In each segment, the company focuses on its core product categories of cleaning, laundry care, kitchen goods and wellbeing. The Leifheit Group employs some 1,100 people. More information on Leifheit is available online at www.leifheit-group.com, www.leifheit.de and www.soehnle.de.