Accell Group Profits Down 33% in 1999

AMSTERDAM, Netherlands (11 February 2000)--The Accell Group, Europe's third largest bicycle group, posted profits of NLG6.6 million (US$2.9mn) in 1999, a drop of 33% compared to the year before (1998: NLG9.6 million(US$4.2mn)). Over all sales were also down--from NLG329.8 million (US$145.1mn) in 1998 to NLG331.2 million (US$145.7mn) last year. According to Accell Group Managing Director RenÈ Takens, the group was hit particularly hard in the second half of the year. During a press conference in Amsterdam, he named the significant rise of the value of the Japanese yen and the earthquake in Taiwan as the main reasons for the poor performance.
"Aside from the infrastructural problems caused by the earthquake, people were emotional involved," said Takens. "Work came to a halt, and in a just-in-time situation the slightest kink affects the entire system." "I have been in the bicycle business for 14 years and I've never seen such a strong increase in just a few month's time," said Accell financial director Wino A. de Jong, referring to the yen's strong performance against the Dutch guilder. Many of the components used on Accell bikes are Japanese made.
Accell's Dutch companies--Batavus, Sparta, Koga and Hadee--consolidated their market positions last year and posted sales on par with 1998. However, sales in Germany came under pressure in 1999. Both Mercier and Lapierre, on the other hand, increased their sales further, despite the declining market situation. According to Takens, unit sales remained at the same level last year as in 1998, or approximately 700,000 units. Accell currently has a 30-35% share of the Dutch bicycle market. This includes all of its brand, including the recent acquisition of Dutch manufacturer Sparta. (JW)