Annual report 2016/17
The Group achieved total sales of DKK 1,849 million – on a par with the last financial year – and EBIT of DKK 44 million, which is double the figure for last year and in line with the outlook announced in August 2016. Net profit for the year and comprehensive income totalled DKK 29 million.
During 2016/17, Flügger stabilised delivery reliability and initiated a necessary consolidation and streamlining process. In Denmark and Sweden, sales declined by 1% and 3%, respectively. In Norway, the Group realised growth of 3%, while sales outside Scandinavia – primarily in Poland and China – grew by 9% overall.
The streamlining initiatives have had a positive impact on the consolidated balance sheet. Intangible assets and property, plant and equipment were reduced by DKK 56 million, and the Group’s inventories and receivables were reduced by DKK 21 and 22 million, respectively. In step with these reductions, the Group’s portfolio of securities and cash and cash equivalents increased by DKK 42 million to DKK 138 million, while the Group’s bank debt was reduced by DKK 54 million. DKK 45 million has been allocated for dividends, equivalent to DKK 15 per DKK 20 share.
In 2017/18, Flügger expects to see revenue on par with 2016/17, and an EBIT margin of 2-3%. We have a long-term goal of achieving revenue of DKK 2 billion in 2020/21, but are adjusting our expected EBIT margin from 8-10% to 6-8%. The downward adjustment is due to the expectation of intensifying competition, and increased investments as a result of the ongoing consolidation of the store network and production facilities.
Jimmi Mortensen, CEO of Flügger A/S, says:
“The 2016/17 financial year saw a number of changes at Flügger. We have adjusted our structure and launched initiatives to reduce the complexity of our organisation and the entire value chain, creating a more agile Flügger. The fight for market share has intensified. This means we have to be even better at offering our customers solutions that help them save time, while also ensuring a good result. We also have a strong focus on accessibility in terms of store locations, opening hours, product range and professional advice, and have initiated a process aimed at consolidating our network of stores across markets.”