Dornbirn, Austria – The Zumtobel Group based in Dornbirn, Austria, has made a good start to the 2007/08 financial year with a successful first quarter. Group revenues rose 6.1% to EUR 323.1 million (Q1 2006/07: EUR 304.5 million), while adjusted EBIT increased 10.2% to EUR 33.3 million (PY: EUR 30.2 million). Both corporate divisions contributed to this positive development: while revenues in the luminaire sector moved ahead 4.0% to EUR 235.9 million (PY: EUR 226.8 million), the components sector continued its rapid progress, reporting a 10.1% increase in revenues to a total of EUR 105.0 million (PY: EUR 95.4 million). One particularly rewarding development was the growth of the Group’s LED business, which advanced 85% to EUR 8.6 million on the back of a major order.
“In the first quarter of 2007/08 we hit the targets we had set ourselves. Our revenue and earnings growth confirms that we are on the right track. And the marked positive development of business in our core European market enables us to look to the rest of the year with confidence,” said Zumtobel Group CEO Andreas Ludwig.
Strong growth in the core European market
A regional breakdown primarily reveals that business picked up speed significantly in the Group’s core European market, where sales were up 8.7% to EUR 262.9 million (PY: EUR 241.9 million). One major contributory factor here was a marked increase in revenues at Thorn in the UK.
Return on sales of over 10% targeted for 2007/08
Profitability also improved at the Zumtobel Group in Q1, as the EBIT margin rose from 9.9% to 10.3%. Here too, both divisions contributed. As a result, the Group is on track to achieve its full-year targets of a double-digit EBIT margin and revenue growth of between 5% and 6%. The Group’s balance sheet structure showed a further improvement, with the equity ratio moving ahead to 39%. The fall in net profit to EUR 25.1 million (PY: EUR 27.6 million) was due to non-recurring latent – and thus non-cash – tax proceeds in the first quarter of the previous year.
Milestones for further growth and enhanced profitability
In the course of the first quarter, the Group reported further milestone achievements in its efforts to boost profitability and open up new opportunities for growth. In respect of investments in the production sector, early in summer two luminaire plants in Australia were merged to form a single processoriented production facility. Then, early in September, construction work started on the new plant at Spennymoor in the UK, where production is scheduled to begin in the second half of 2008. To lay the foundations for further revenue growth, in the period under review the Group also made a smallerscale targeted acquisition in Hungary and increased its existing stake in a company in India.