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Van de Velde NV

Earnings Release Aug 28, 2015

4020_rns_2015-08-28_08ee912b-6640-4a46-8174-428bb48eff15.pdf

Earnings Release

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28.08.2015 - PRESS RELEASE INTERIM RESULTS 2015

  • CONSOLIDATED TURNOVER RISES BY 8.2%.
  • REBITDA INCREASES BY 11.0%.
  • RECURRING NET PROFIT INCREASES.
  • LIQUIDITY AND SOLVENCY POSITION REMAINS VERY STRONG.
  • THE BOARD OF DIRECTORS DECIDES TO DISTRIBUTE AN INTERIM DIVIDEND OF €1.35 PER SHARE IN AUTUMN 2015.

TURNOVER DEVELOPMENTS FIRST HALF-YEAR

Consolidated turnover at Van de Velde in the first half of 2015 rose by 6.0% (from € 107.0m to € 113.4m).

On a like-for-like basis (including comparable deliveries) consolidated turnover was up 8.2%. This turnover growth consists of the following components:

  • 8.3% growth in wholesale turnover. Growth has continued in all areas: lingerie, beachwear and stayers. In addition, pre-orders for the second half of the year are higher than the same period the previous year.
  • A fall in retail turnover at Intimacy by 4.7% (10.3% on a like-for-like basis) in local currency. Due to the strengthening of the American dollar against the euro, retail turnover in euro was up 17.1%.
  • In Europe retail turnover rose on a like-for-like basis (excluding store closures) by 4.3%.

RECURRING EBITDA ('REBITDA') HIGHEST EVER FIRST HALF-YEAR

REBITDA for the first half year increased by 6.3%, from € 34.2m to € 36.4m. On a comparable basis (including comparable deliveries), consolidated REBITDA rose by 11.0%, from € 32.3m to € 35.9m. The primary reasons for this rise were the following:

  • A rise in wholesale turnover.
  • An increase in gross margin primarily due to a positive price and currency effect.
  • Increases in fixed costs are mainly related to sales-driving costs (such as marketing and customer programs).
  • REBITDA in the retail business is in line with the same period in the previous year.

IMPAIRMENT OF GOODWILL AND INTANGIBLE ASSETS WITH INDEFINITE USEFUL LIFE

In the first half of 2014, an impairment charge of € 16.3m was recorded in relation to the goodwill and the intangible assets of Intimacy. There are no impairment charges in the first half of 2015.

FINANCIAL RESULT

The financial result was lower than in the same period last year. This is related to lower interest income as well as negative unrealised exchange losses as a result of the weaker euro.

SHARE OF RESULTS OF ASSOCIATES

The share of results of associates (based on the equity method) was primarily driven by the contribution by Top Form. The contribution by Top Form was based on equity movements up to and including 30 June 2015. Top Form posted profit of HK\$ 35.9m for fiscal year 2015 (1 July 2014-30 June 2015) versus profit of HK\$ 39.3m the previous year. The first half of Top Form's fiscal year 2015 (1 July 2014-31 December 2014) was recognised in Van de Velde's 2014 year-end figures (reported profit of HK\$ 17.1m).

INCOME TAXES AND PROFIT FOR THE PERIOD

Income taxes were lower compared with the same period last year.

The group profit rose from € 5.0m to € 22.0m (+342.0%). The recurring group profit (excluding the non-recurring impairment charge related to Intimacy) rose from € 21.3m to € 22.0m (+3.2%) and the recurring profit per share rose from € 1.60 to € 1.65.

The Board of Directors today approved, based on the powers invested in it by the articles of association, the payment of the interim dividend of € 1.35 per share. After payment of 25% tax, this represents a net dividend of € 1.01 per share.

This dividend will be allocated to the shares with rights that are not suspended. The shares with rights that are suspended are the 5,000 treasury shares bought back under an option programme. The number of shares with dividend rights has accordingly been reduced from 13,322,480 to 13,317,480.

The dividend for registered shares and dematerialised shares will be paid out on 19 November 2015.

Financial calendar with regard to the interim dividend:

  • Ex-coupon date: 17 November 2015
  • Record date: 18 November 2015
  • Payment date: 19 November 2015.

CASH POSITION AND SOLVENCY/LIQUIDITY

At half-year the cash position was € 22.6m (versus € 28.2m last year).

Solvency (share of equity in total equity and liabilities) of Van de Velde Group remained very high (80.6%). The current assets represented 3.4 times the value of the current liabilities, an indication of strong liquidity. Furthermore, the Group is primarily self-financed.

PROSPECTS

In wholesale, pre-orders for autumn/winter 2015 are higher than the previous year. This rise is naturally lower than in the first half year because of the absence of the swimwear factor. However, Van de Velde expects a rise in wholesale over the whole year 2015.

Intimacy is rebranded as Rigby & Peller as from 15 September. As well as having a stronger tradition in Lingerie Styling, this is Van de Velde's international brand. At the same time, an

"extreme customer centricity" programme will be implemented to improve service to consumers. Finally, a new leader will be appointed for the USA.

Van de Velde also expects a rise in REBITDA for 2015 on a comparable basis. On an annual basis, this rise will in terms of percentage be lower than the 11% reported at half-year.

INTERIM FINANCIAL REPORT

The interim financial report (including regulated information and the report of the statutory auditor on the half-year information) can be accessed by following this link.

A number of key figures are presented below and explained more fully in the financial report:

Financial key figures
Profit and loss statement (in € m) 30.06.2015 30.06.2014
Turnover 113.4 107.0
Recurring EBITDA (operating profit plus depreciation) 36.4 34.2
Recurring EBIT or operating profit 32.4 30.6
Profit before taxes 31.6 14.8
Profit for the period 22.0 5.0
Recurring profit for the period (excluding impairment) 22.0 21.3
Balance sheet (in € m) 30.06.2015 31.12.2014
Fixed assets 70.6 68.0
Current assets 89.7 91.9
Total assets 160.3 159.9
Shareholders' equity 129.1 134.0
Non-controlling interest 0.7 0.7
Non-current liabilities 4.5 4.6
Current liabilities 26.0 20.6
Total equity and liabilities 160.3 159.9
Key figures in € per share 30.06.2015 30.06.2014
Basic earnings per share 1.65 0.37
Recurring basic earnings per share 1.65 1.60

CONTACTS

For more information, contact:

Van de Velde NV – Lageweg 4 – 9260 Schellebelle – 09 365 21 00 www.vandevelde.eu

EBVBA 4F, always represented by Ignace Van Doorselaere Stefaan Vandamme Chief Executive Officer Chief Financial Officer

VAN DE VELDE

Van de Velde NV is a leading player in the luxury and fashionable women's lingerie sector. Van de Velde is convinced of a long-term strategy based on developing and expanding brands around the Lingerie Styling concept (fit, style and fashion), especially in Europe and North America.

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