Accell Group scores double-digit growth in both sales and net profit

Accell Group reported sales of €573.8 million in the first half of the year, up by 13 percent over the same period in 2014. Growth was largely driven by higher sales of electric bicycles, which now represent 34 percent of its turnover, and sports bicycles in the higher segment of the market. The Dutch group recorded net profit of €31.9 million excluding non-recurring items, representing a 21 percent increase. The first half of 2014 included non-recurring income of € 1.2 million, which means the increase in net profit including non-recurring items was of 16 percent. Operating profit of €49.1 million was up by 29 percent compared with the same period in 2014, and translated into an operating margin (Ebit) of 8.6 percent versus 7.5 percent in the first half of 2014. The only disappointing news came from the Netherlands, Accell Group's home market and the company's biggest sales territory, where bike sales in the first half dropped by 3 percent in value and the number of bikes sold declined by 5 percent.

By business segment, the group saw the bicycles segment book a turnover of € 432.7 million, up by 14 percent against the first half of 2014. The segment result was of €46.3 million as compared to €37.2 million in the same period of last year. Parts & accessories booked sales of €141.1 million against €118.5 million in last year's first half, with a segment result of €10.3 million, up from €7.8 in the first half of 2014.

In the bicycles segment, the total number of bicycles sold came in at 985,000, as compared to 1,018,999 in the first half of 2014. The average sales price increased by 16 percent to €439, due to the greater proportion of electric bicycles and more expensive sports bicycles in the turnover. Sales of electric bikes increased by 20 percent, primarily due to strong growth in Germany. Sales of traditional bicycles were up by 4 percent. For sports bikes, the turnover increased by 8 percent.

In the Netherlands, Accell Group completed in the first half the merger of the production of bicycles for Batavus and Sparta in Heerenveen, where the group has its headquarters. Accell Group tops the market of electric bikes in the country with the brands Batavus, Koga and Sparta. In Germany, bicycle sales increased by 22 percent compared with the first half of 2014. Growth in the German market was largely due to solid sales of Haibike performance e-bikes. Sports bicycles in the higher segment also continued to perform well, with sales growth driven among others by solid sales of Ghost bikes.

In the rest of Europe, the increase in bicycle sales was largely driven by Haibike's growth, with France, Belgium, Switzerland, Austria and the U.K. as the key countries. In Italy and Scandinavia sales also grew on the back of higher sales of electric bicycles.

In North America, bicycle sales under the Diamondback brand increased due to deliveries to multi-sports chains. The newly-introduced German brand Ghost also made a solid contribution to turnover growth in North America in this sales channel. Sales of Raleigh bikes to specialist retailers declined, partly due to competition from internet sales. Sales of electric bicycles, which were introduced in North America this year, were higher, but this segment is still modest in the region. Accell Group said it will be adjusting its North American sales organization. The focus for the Raleigh brand will be on renewed brand positioning.

As for other countries, about half of the bicycle sales outside of Europe was realized in Turkey, where the turnover grew in the first half of the year. The remaining sales took place largely in Asia and Australia.

In the segment of bicycle parts and accessories, where sales came in 19 percent higher, Accell Group's own brands, including XLC, Raleigh and Diamondback, saw continued growth and were up by 17 percent compared with last year's first half. Of the turnover growth in this segment, 11 percent came from the acquisition of Comet (Spain) and Denmark-based Cycle Service Nordic (CSN).

The group said the outlook for the second half of 2015 is for continued growth, with an expected increase of both result and turnover.