V-ZUG HOLDING AG Improved results with stable sales development
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V-ZUG Holding AG / Key word(s): Half Year Results Zug, 21 July 2023
Consistent cost management in response to difficult market situation In the first half of 2023, V-ZUG generated net sales of CHF 298.2 million, 1.6 % lower than in the previous year’s period (H1 2022: CHF 303.0 million). Operating profit (EBIT) amounted to CHF 5.1 million (H1 2022: CHF 4.3 million). There were no more supply shortages in the first half of the year, however, purchase prices remained high. To address market-related declining volumes, additional measures to increase sales as well as cost-saving initiatives are being implemented. V-ZUG remains committed to its medium-term targets. Sales volumes under pressure – stable net sales Net sales of the V-ZUG Group decreased slightly by 1.6 % to CHF 298.2 million in the first half of 2023 (H1 2022: CHF 303.0 million; currency adjusted - 1.0 %). This development was due to lower volumes in Switzerland, sales growth in International Markets and effects from sales price increases. The restrained market development in Switzerland mainly affected new buildings and renovations, each accounting for around a third of appliance sales. Replacement investments, as well as customer service remained on a good level. Our customers’ inventories were still well stocked, which put further pressure on volumes. The performance of International Markets varied across regions. International Markets’ share of net sales in this period amounted to 20.4 % (H1 2022: 17.8%). Operating result improved With the help of sales price increases implemented in stages in the previous year and in February 2023, the company was able to counter the high purchase prices. EBIT increased to CHF 5.1 million (H1 2022: CHF 4.3 million); the EBIT margin was 1.7 % (H1 2022: 1.4 %). To improve profitability, various measures to increase sales and to reduce costs are being implemented: procurement costs are continuously being addressed, the number of temporary jobs reduced, vacancies only selectively filled, and recruitment activities by and large suspended. Projects have been reprioritised and expenditures cut back. V-ZUG adjusts its structural cost base successively to remain agile. Cash Flow from operating activities was CHF 17.9 million in the first half of 2023 (H1 2022: CHF -25.2 million) compared to previous year due to deviations within trade receivables and inventory. As in the previous year, cash flow from investing activities was mainly influenced by the site transformation; it amounted to CHF - 25.4 million (H1 2022 CHF - 24.0 million). Free cash flow was CHF -7.5 million (H1 2022: CHF - 49.2 million). As of 30 June 2023, the balance sheet remained strong with an equity ratio of 75.4 % (31 December 2022: 74.8 %) and cash and cash equivalents including securities of CHF 56.4 million (31 December 2022: CHF 64.5 million).
Attractive growth in International Markets In International Markets, V-ZUG’s total sales saw an increase of 13.0 % to CHF 60.8 million; sales development varied across regions. Order intake was affected to some extent by global uncertainties and cautious consumer behaviour. V-ZUG systematically invests in the growth of carefully selected international markets and metropolitan areas.
Special edition to mark Adora’s 65th anniversary The Adora washing machine was developed in 1958 with sustainability in mind and has been produced in Switzerland since 1959. Today’s production process is CO2-neutral. In terms of laundry performance, it is second to none. Thanks to using less water, energy and detergent, the appliance also washes in a resource-efficient way. To celebrate Adora’s anniversary, a special edition is being launched. Among other improvements, the AdoraWaschen V4000 OptiDos and AdoraTrocknen V4000 models are being enhanced with functional upgrades to provide additional fabric care benefits at unparalleled value for money.
Success through sustainability The company released its 2022 Sustainability Report on 29 March 2023. It provides comprehensive details of numerous accomplishments and initiatives. These include reducing carbon emissions, improving the energy-efficiency ratings of appliances and aligning the company’s operations with the circular economy, to name just a few. The next sustainability report will be included in the V-ZUG Annual Report 2023 and be released on 13 March 2024.
Key Figures
EBITDA: Operating result (EBIT) before depreciation, amortisation and impairment. Equity ratio: Proportion of a company’s assets is financed with equity. It is defined as equity expressed as a percentage of total equity and liabilities.
This ad hoc announcement is available at https://vzug.com/gb/en/investor-relations-news and the 2023 Half-Year Report at https://wwww.zug.com/gb/en/financial-reports.
Further information
Key dates
About the V-ZUG Group V-ZUG Holding AG is listed in the Swiss Reporting Standard of SIX Swiss Exchange in Zurich and represented in the Swiss Performance Index (SPI) (securities number 54 248 374, ISIN CH0542483745, ticker symbol VZUG).
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1685089 21-Jul-2023 CET/CEST