In H1 2013, those of Hartmann's European markets that were affected by price adjustments in 2012 continued to stabilise, and the North American business generated both revenue growth and operating profit growth. Hartmann initiated processes to enhance production efficiency in Europe and to expand its existing production capacity in North America. Cash flows remained strong in the first six months of the year. Hartmann retains its full-year guidance for revenue of DKK 1.5-1.6 billion and a profit margin of 7.5-9.5%.
CFO and interim CEO Marianne Rørslev Bock on Hartmann's performance in H1 2013:
"We are still pursuing our strategy of improving Hartmann's competitive edge and preparing the business for further growth. During the first half year, we have worked diligently to increase profitability in Europe, where stabilisation has continued following a volatile 2012. With a strengthening of the European business and the expansion of our capacity in North America, Hartmann will have a solid foundation for further growth."
Marianne Rørslev Bock on Hartmann's outlook:
"Based on developments in the first half year and the stabilisation in Europe, we retain our guidance of revenue of DKK 1.5-1.6 billion and a profit margin of 7.5-9.5% in 2013."
Highlights
- For H1 2013, revenue was DKK 793 million (2012: DKK 769 million) and operating profit* DKK 65 million (2012: DKK 62 million), equal to a profit margin* of 8.2% (2012: 8.1%). For Q2 2013, revenue was DKK 370 million (2012: DKK 358 million), and operating profit was DKK 21 million (2012: DKK 17 million), equal to a profit margin of 5.7% (2012: 4.7%).
- Cash flows from operating and investing activities grew to a net cash inflow of DKK 66 million for H1 2013 (2012: a net cash inflow of DKK 52 million) and a net cash inflow of DKK 30 million for Q2 2013 (2012: a net cash inflow of DKK 10 million). Return on invested capital fell to 12.1% (2012: 18.2%) due to special items.
- Hartmann's European markets continued to stabilise relative to H2 2012. Revenue for H1 2013 was DKK 647 million (2012: DKK 639 million), and operating profit was DKK 44 million (2012: DKK 45 million), equal to a profit margin of 6.9% (2012: 7.0%). For Q2 2013, revenue was DKK 296 million (2012: DKK 295 million), and operating profit was DKK 10 million (2012: DKK 9 million), equal to a profit margin of 3.5% (2012: 2.9%).Despite the positive trends, performance remained unsatisfactory.
- In North America, revenue grew to DKK 146 million in H1 2013 (2012: DKK 130 million), and operating profit was DKK 33 million (2012: DKK 31 million), equal to a profit margin of 22.9% (2012: 23.5%). For Q2 2013, revenue was DKK 74 million (2012: DKK 63 million), and operating profit grew to DKK 18 million (2012: DKK 15 million), equal to a profit margin of 24.0% (2012: 23.5%).
- The expansion of Hartmann's existing production capacity in North America was initiated in the second quarter of the year and is progressing to plan. The investment is expected to be fully implemented in 2014.
- Special items amounted to DKK 39 million in H1 2013 (2012: DKK 0 million) as a result of the closure of Hartmann's manufacturing facility in Finland and a severance payment to former CEO Michael Rohde Pedersen. The closure of the Finnish manufacturing facility is progressing to plan and is expected to contribute DKK 10 million to operating profit annually. The effect is expected to be fully reflected from 2014, while the effect will be limited in 2013. The Board of Directors has initiated the process of recruiting a new CEO, and CFO Marianne Rørslev Bock will temporarily be in charge of the day-to-day management.
- Hartmann retains its full-year guidance of revenue of DKK 1.5-1.6 billion and a profit margin of 7.5-9.5%.
* References to operating profit refer to operating profit before special items, and references to profit margin refer to profit margin before special items.
For additional information, please contact:
Marianne Rørslev Bock
CFO and interim CEO
Tel.: (+45) 45 97 00 57
