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Accell Had OK 2012, But Not on Home Market

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HEERENVEEN, The Netherlands – Total turnover was up 23% thanks to the Raleigh acquisition while organic turnover growth stood at 3%. At today’s press conference on its 2012 results it became clear that Accell Group NV had a reasonably OK 2012. But not on its home market Holland where the holding is possibly forced to dismiss employees.

Accell Had OK 2012, But Not on Home Market
With pride CEO Takens was able to show the United States in the company’s geographical turnover specification.

For the third consecutive year, Accell Group NV saw its results on the Dutch market deteriorate in 2012. Since the recession began in 2008 the worldwide operating bike holding is struggling on what is its biggest market. In 2009, the turnover of the Accell companies in the Netherlands reached € 236.7 million; 2012 sales totaled € 206 million, a decrease of 13% since 2009.

Unfavorable market conditions

On its home market, Accell saw turnover from bicycles fall by 7% in 2012 (compared with a total market drop of 13%). Turnover in bicycle parts & accessories was up 3%. The market conditions were unfavorable in 2012, due to hesitant consumer spending and poor weather conditions in the second quarter. In view of the market developments in the Netherlands, Accell Group will in the near future look at how it can further intensify the cooperation between its Dutch companies or combine the activities. Accell expects to be in a position to report on the progress and any impact this may have on employment before the end of the quarter.

17% drop in net operating result

Accell’s total turnover stood at € 772.5 million in 2012, from € 628.5 million in 2011. Next to the acquisition of Raleigh, this was thanked to the rising sales of electric and innovative sports bikes, especially in Germany. The net operating result for the full year 2012 came in at € 26.3 million, down 17% from the € 31.7 million reported in 2011. But in 2011 the net operating result was up big thanks to the €16 million in booked profit from the sale of the 26% shareholding in Derby Cycle AG.

E-bike continues to gain in popularity

Accell Group CEO René Takens: “2012 was largely dominated by the acquisition of Raleigh. This move meant we added brands to our portfolio that are known across the world, and also strengthened our position in the USA and the UK in particular. In 2012, bicycle sales in a number of European countries including the Netherlands came under pressure as a result of reduced consumer spending. The electric bicycle, however, continues to gain in popularity, both in the Netherlands and abroad, especially in Germany. The increased turnover in this segment means it now accounts for 32% of Accell Group’s total turnover in bicycles and that we are market leader in Europe.”

Biggest increase in turnover in Germany

Accell recorded the biggest increase in turnover in Germany. 8% in bike sales and 6% in P&A as the mood is here much more positive compared to other European countries. Total sales of electric bikes in the German market are now estimated at 350,000 – 400,000 annually.

111 million in US turnover

With pride CEO Takens was able to show the United States in the company’s geographical turnover specification. In 2012 the Accell companies in the US scored €111 million in turnover. Accell said on its activities in the US: “The market increased by approximately 6%. In addition to the healthy position of the Raleigh brand in the specialist retail sector, Diamondback has a strong position in specialist sports store chains. Accell Group has initiated the integration of the parts and accessories sales and distribution of Raleigh and SBS. The recently announced closure of the factory in Canada is going according to plan.”

Refinancing the company

At today’s press conference Accell also announced: “We have succeeded in the full refinancing of the company with a strong group of banks.” The refinancing package amounts €300 million. It also leaves Accell some €50 million extra which for the company, as its press release states: “To be well positioned for future growth following the Raleigh acquisition. Moreover, the new financing structure is more suited to the nature of our company.”

Outlook

On his expectation for this year; CEO Takens noted: “We expect the popularity of cycling, for both mobility and leisure purposes, to continue to grow in the coming years. Barring unforeseen circumstances, we expect an increase of turnover and net operating result in 2013. In addition to the organic growth in profit, further contributions will also come from synergies resulting from the cooperation between Accell Group companies and Raleigh.”

More in Bike Europe printed journal; March 2013.

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