Hamburg-based Otto Group saw revenues rose 5.4% to €12.1bn in the financial year ended 29 February, with pre-tax earnings (EBT), up over four times the year before, reaching €187m compared to €44m a year earlier.
Some figures differed significantly from those contained in its preliminary results released on 31 March – when, perhaps surprisingly, it reported a lower growth rate of 4.3% based on higher turnover figures of €12.5bn for the year.
Other numbers were also amended, based on its latest set of results – for example, global e-commerce revenues rose at a steeper rate than previously expected, up 8.8% to €6.5bn for the year.
Its core domestic operations in Germany saw revenues surge 12.3% to €4.6bn – both top-line and the growth rate were higher than previously anticipated, indicating that the group won market share during the year, as it outperformed the overall German e-commerce sector (+12.1%; source: Ti).
The strategic initiatives previously announced by management, aimed at strengthening the core businesses, also comprised investment in digital transformation and new businesses as well as portfolio rationalisation measures, “were consistently and successfully implemented”.
Its annual results also contain key figures for underlying profits and net earnings, which were not disclosed at the end of March.
The multichannel retail division, by far its largest revenue driver, reported lower sales than previously announced at almost €9.6bn but a higher growth rate (+3.7% year-on-year). On a consolidated basis, its retail operations saw EBIT rise by 10.5% to €178m from €161m, and represented almost 70% of group EBIT, with an implied operating margin standing at 1.8%.
On cue, the service unit – which is dominated by the Hermes Group, the largest independent home delivery operator in Germany – reported a strong growth rate of 15.3% in revenues, up to €1.83bn from almost €1.6bn one year earlier. This was a lower growth rate than previously estimated, on higher revenues.
“This growth was once again driven mainly by Hermes’ business activities in Great Britain, although Hermes saw clear growth in Germany too,” it said.
Finally, the financial services segment, which is mainly driven by EOS, recorded a 5% growth rate, with revenues up to €678m from €646m.
Group EBIT rose to €259m from €187m one year earlier, while net income from continuing activities came in at €90m.
According to Otto, the “only clouds on the balance sheet were the disappointing revenue development and repeated high losses” at the 3Suisses mail-order business. The loss-making retail activities of the French 3SI Group are earmarked for sale, “which led to high one-off balance-sheet burdens”.
Chief executive Hans-Otto Schrader said, “With our strong core businesses, a focused company portfolio and targeted investments in technology, mobile commerce and new business models such as Collins and Otto Group Media, we have laid a sound foundation for sustainable, value-driven growth in the years to come.”
The group reiterated revenue growth of 4% this year, on a comparable basis, while it also targeted higher earnings.
Source: Transport Intelligence, June 13, 2016
Author: Alessandro Pasetti
