DGAP-News: Ultrasonic AG / Key word(s): Quarter Results
Ultrasonic AG: Ultrasonic posts record performance in the third
quarter
06.11.2012 / 08:16
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Corporate News
Ultrasonic posts record performance in the third quarter
- Record sales of EUR 42.9 million and record earnings of EUR 9.1 million
in Q3 2012
- Group sales grew 24.9% to EUR 108.3 million in the first nine months
(9M 2011: EUR 86.7 million)
- Gross profit rose 24.8% to EUR 33.5 million in the first nine months
(9M 2011: EUR 26.8 million)
- Pre-tax profit (EBT) increased 23.1% to EUR 30.6 million in the first
nine months (9M 2011: EUR 24.9 million); EBT margin 28.3% (9M 2011:
28.7%)
- Net profit increased 22.7% to EUR 22.8 million in the first nine months
(9M 2011: EUR 18.6 million)
- Urban Footwear (including accessories) was the strongest division, with
growth of 65.0% in Q3 and 45.2% in the first nine months
- Guidance for 2012 confirmed and outlined in more detail
Cologne, 6 November 2012 - Provisional figures for Ultrasonic AG (Prime
Standard, ISIN DE000A1KREX3, US5), the German holding company of an
established Chinese manufacturer and supplier of high-quality branded urban
footwear products, show a clear rise in sales and earnings in the third
quarter of this year. As the Management Board had expected, for seasonal
reasons, based on sales and earnings the third quarter was the strongest so
far this year. This resulted in new sales and earnings records on both a
quarterly and a nine-month view. Sales revenues* were EUR 42.9 million in
the third quarter and EUR 108.3 million in the first nine months, a
year-on-year rise of almost 33% and 25% respectively. At the same time,
income after taxes increased by around 29% to EUR 9.1 million between July
and September and by nearly 23% to EUR 22.8 million in the first nine
months. Pleasingly, margins were either constant or, where the cost base
increased, only slipped slightly. The Urban footwear segment (including
accessories) grew 65.0% in the third quarter and made a significant
contribution to the increase in sales.
Management Board Chairman and CEO Qingyon Wu is satisfied with the
company's business performance. In his view, ULTRASONIC is well-positioned
for further growth: 'The third quarter showed that demand for our products
is still high in China. Although overall economic growth in China has
recently loss some momentum, annual growth in consumer spending was still
grew over 14% and we once again saw a strong rise in sales figures. Our
Urban footwear and Shoe soles segments, in particular, are geared to the
Chinese market. The positive performance of these segments in the past
quarter confirms our view that we have targeted the right trends. With our
investments we are continuing to target this market to realise our goal of
becoming the leading Chinese manufacturer of high-quality branded leisure
footwear.
Sales and earnings
Group sales grew 24.9% year-on-year in the first nine months, from EUR 86.7
million to EUR 108.3 million. Alongside currency effects (compared with the
previous year, the average exchange rate for the euro versus the Chinese
renminbi depreciated by around 12%), the main factors driving the increase
in sales were price increases and, above all, a significant rise in unit
sales in the Urban footwear segment in the third quarter.
The Urban footwear and Shoe soles segments reported an increase in volume
sales in the reporting period. 53% of the Urban footwear segment's sales
come from China, while Shoe soles generates all of its sales on the home
market. By contrast, there was a slight drop in volume sales in the highly
export-oriented Sandals and slippers segment. However, this was partially
offset by the sale of higher-margin products. The highest sales growth in
the reporting period was posted by Urban footwear (including accessories),
which lifted revenues by about 45.2% year-on-year and contributed EUR 40.3
million (37.2%) of Group sales. As in the previous quarter, the Urban
footwear segment was both the fastest growing segment and the main sales
generator. Within the Urban footwear segment (including accessories) sales
of the ULTRASONIC brand increased by around 43.2% year-on-year from EUR
15.0 million to EUR 21.4 million and accounted for 53.2% of segment sales
(9M 2011: 54.0%) and 19.8% of total sales (9M 2011: 17.3%). This segment's
OEM sales grew 47.6% from EUR 12.8 million in the first nine months of 2011
to EUR 18.9 million in the first nine months of 2012. In the Shoe soles
segment sales were 22.8% higher than in the prior-year period at EUR 35.0
million (9M 2011: EUR 28.5 million). In this segment, new machinery also
allows production of higher-quality products for which there is increasing
demand from major Chinese manufacturers of sports goods. These products
command higher prices and generate better margins. Sales revenues only
increased by 8.4% to EUR 32.9 million in the Sandals and slippers segment
(9M 2011: EUR 30.4 million).
The Group's gross profit increased by EUR 6.6 million (24.8%) in the first
nine months to EUR 33.4 million (9M 2011: EUR 26.8 million). It therefore
rose by slightly less than sales. Higher raw material and personnel
expenses in the reporting period were largely passed on to customers
through price rises. The gross profit margin was 30.9%, and thus only
slightly below the year-back level of 31.0%.
In the Urban footwear segment (including accessories), gross profit rose
47.3%, considerably faster than sales, which were up 45.2%. The gross
profit margin therefore increased to 31.1% (9M 2011: 30.7%). This is
attributable to the sale of higher margin products and to higher selling
prices. The gross profit margin in the Shoe soles segment slipped to 30.8%,
down from 31.3% in the first nine months of 2011, due to price erosion on
many simple products. ULTRASONIC is countering this trend by successively
switching to new machinery that uses more complex production technology.
This enables it to increase production of higher margin and higher-priced
shoe soles. The gross profit margin in the Sandals and slippers segment was
unchanged at 30.8% at the end of the first nine months of 2012 (9M 2011:
30.8%). The drop in the gross profit margin in the Shoe soles segment was
almost entirely offset by the increase in the margin in the Urban footwear
segment (including accessories).
While marketing and selling expenses have risen roughly in line with sales
since last year, to EUR 1.1 million (9M 2011: EUR 0.9 million),
administrative expenses rose faster, increasing from EUR 1.1 million in the
first nine months of 2011 to EUR 1.8 million in the first nine months of
2012. This was mainly due to the new corporate structure and expenses for
Ultrasonic AG. As in the first nine months of 2011, the Group's financial
result was essentially balanced.
All other earnings indicators still show a clear improvement compared with
the previous year. EBITDA increased 22.1% year-on-year in the first nine
months of 2012, from EUR 25.9 million to EUR 31.6 million. Group EBIT
increased 22.7% year-on-year, from EUR 30.6 million to EUR 24.9 million.
The EBIT margin was therefore 28.2% (9M 2011: 28.8%). Earnings before taxes
(EBT) were EUR 30.6 million in the first nine months of this year, a rise
of 23.1% from the prior-year figure of EUR 24.9 million. The EBT margin was
28.3% (9M 2011: 28.7%). After taxes (income tax rate 25% since 2008) the
Group's net profit for the period was EUR 22.8 million, a year-on-year
increase of 22.7% (9M 2011: EUR 18.6 million). Earnings per share (basic
and diluted) were EUR 1.99 in the reporting period (9M 2011: EUR 1.72 per
share).
Outlook
The Management Board anticipates that the growth trend will continue in the
remainder of the year and that the company will meet its sales and earnings
targets. Based on present projections for its own business situation and
taking the economic situation into account, expects to report sales growth
of 20-25% in 2012, assuming around 12% depreciation of the euro versus
the renminbi. The forecast for the pre-tax margin (EBT relative to sales)
has now been defined as around 26-29%.
By embarking on investment to raise production capacity the ULTRASONIC
Group has paved the way for further planned expansion. The acquisition of
the new production complex near Xiamen, which was completed in October, is
a major step forward in the growth strategy announced by the company. The
investment plan for the period up to 2017, which is based entirely on funds
currently available, comprises expenditures of over EUR 50 million to
expand production plants and equipment. As a result of the acquisition,
from next year ULTRASONIC will be able to produce at least some products
for the Urban footwear segment in-house. The Management Board expects this
to prove beneficial for earnings. In addition, completion of all expansion
work will raise production capacity in the Shoe soles and Sandals and
slippers segments by a further 35-45%.
In parallel with the expansion of production capacity, the Group is driving
forward expansion of its distribution network. In the reporting period,
distributors registered rising demand for the UTLRASONIC brand of footwear.
In the first nine months of this year, 4 distributors joined the ULTRASONIC
distributor network, bringing the total number of distributors to 11 as of
30 September 2012. The network now covers 11 provinces and 1 district city.
The Management Board expects to see a steady rise in both the number of
distributors and the number of ULTRASONIC shops operated by them in the
coming months. At present, the number of ULTRASONIC brand stores is
expected to increase to 110 by year-end (30 September 2012: 97 shops).
The full interim report for the first nine months of 2012 will be published
on 28 November 2012 and will be available for download from the Investor
Relations/Publications section of the company's website at
www.ultrasonic-ag.de.
ULTRASONIC will present its preliminary figures for Q3 and the first nine
months 2012 at the German Equity Forum ('Eigenkapitalforum'), taking place
in Frankfurt/Germany from 12 November to 14 November in the Congress Center
of Messe Frankfurt's trade fair complex. ULTRASONIC will hold its
presentation on Tuesday, 13 November, at 4.30 p.m., Room London.
* The figures for the nine months ended 30 September 2011 (9M 2011) concern
the Consolidated Interim Statements of China Ultrasonic Outdoorwear
Holdings Limited, Hong Kong, a 100% subsidiary of Ultrasonic AG, and are
shown for comparison purposes. The average exchange rate for 9M 2012 was
EUR 1 = CNY 8.1181.
<pre>
Financial Data*
Overview
Q3 Q3 9M 9M Change vs.
9M
in EUR thousands 2012 2011 2012 2011 in %
Sales 42,921 32,349 108,290 86,700 24.9%
thereof Urban
Footwear 15,850 9,456 39,273 26,650 47.4%
thereof Shoe soles 13,670 10,221 35,049 28,542 22.8%
thereof Sandals
& Slippers 12,930 12,236 32,945 30,406 8.3%
thereof Accessories 471 436 1,023 1,102 -7.2%
Gross profit 13,308 10,083 33,481 26,837 24.8%
EBITDA 12,620 9,740 31,615 25,886 22.1%
EBT 12,279 9,427 30,649 24,894 23.1%
EBT margin 28.6% 29.1% 28.3% 28.7%
Group net income 9,068 7,030 22,771 18,562 22.7%
Return on Sales 21.1% 21.7% 21.0% 21.4%
Earnings per share
in EUR 0.79 0.65 1.99 1.72 15.7%
30.09.2012 31.12.2011
Cash and bank 93,747 77,520 20.9%
balances
Equity Capital 115,972 93,562 23.9%
Equity ratio 80.9% 79.1%
</pre>
About Ultrasonic
The Cologne-based company Ultrasonic AG is the German holding company of
the Chinese ULTRASONIC Group, an established manufacturer and supplier of
high-quality branded urban footwear. With around 1,400 employees the Group
operates in three market segments, each of which contributes about a third
to the Group's revenue. ULTRASONIC produces sandals and slippers for the
upper price segment and is a long-term supplier of shoe soles for leading
manufacturers in the booming Chinese sport shoe industry, for example Anta,
Xtep and Unisuper. Moreover, the company has successfully established its
own 'Urban footwear' collection which is marketed under the ULTRASONIC
brand and is specifically designed to meet the needs and taste of China's
growing urban middle class. ULTRASONIC's branded urban footwear collection
is currently marketed in around 100 ULTRASONIC mono-label shops, which
achieve selling prices in a range from RMB 400 to RMB 1,200 per pair,
equivalent to approx. EUR 50 to EUR 140. Within the last three years
ULTRASONIC's business had a compound annual growth rate of more than 34.4
percent. In FY 2011, the company generated total revenues of EUR 119.4
million and achieved a net profit of EUR 24.9 million.
For further information about the company visit: www.ultrasonic-ag.de
Disclaimer:
This document is no offer for the purchase of securities in the United
States of America. Securities may only be sold or offered for sale with the
previous registration under the U.S. Securities Act of 1933 in the actual
valid version or without previous registration only pursuant to an
exemption. The shares of Ultrasonic AG (the 'Shares') have not been
registered under the U.S. Securities Act of 1933 in the actual valid
version and may not be sold or offered in the United States.
This document is only being distributed to and is only directed at (i)
persons who are outside the United Kingdom or (ii) to investment
professionals falling within Article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005 (the 'Order') or (iii)
high net worth entities, and other persons to whom it may lawfully be
communicated, falling within Article 49(2)(a) to (d) of the Order (all such
persons together being referred to as 'relevant persons'). The Shares,
which are referred to, are only available to relevant persons and any
invitation, offer or agreement to subscribe, purchase or otherwise acquire
such securities will be engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this document or any
of its contents.
Contact:
Ultrasonic AG
Chi Kwong Clifford Chan
Member of the Management Board and CFO
Email: clifford.chan@suoli.cc
Phone +86 1525 947 9902 (China)
Phone +852 966 227 40 (Hong Kong)
End of Corporate News
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06.11.2012 Dissemination of a Corporate News, transmitted by DGAP - a
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Language: English
Company: Ultrasonic AG
c/o BPG Beratungsund Prüfungsgesellschaft mbH,
Graf-Adolf-Platz 12
40213 Düsseldorf
Germany
Phone: +49 (0)211 172 980; +86 1525 947 9902 (China); +852 966
227 40 (Hong Kong)
Fax: +49 (0)211 172 9829
E-mail: clifford.chan@suoli.cc
Internet: www.ultrasonic-ag.de
ISIN: DE000A1KREX3
WKN: A1KREX
Indices: CDAX, Classic All Share, DAXsector All Consumer, DAXsector
Consumer, DAXsubsector All Clothing & Footwear,
DAXsubsector Clothing & Footwear, Prime All Share
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Stuttgart
End of News DGAP News-Service
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191555 06.11.2012
DGAP-News: Ultrasonic AG: Ultrasonic posts record performance in the third quarter
| Source: EQS Group AG