Accell Group’s indoor/outdoor strategy and its decision to keep stock available for reorders had positive effects on its turnover for the first half of this year, which grew by 10 percent on an organic basis and by 14 percent after acquisitions, reaching €275 million.

Because of warm weather through most of Europe during the period, its sales of fitness equipment grew by only 3 percent to €19.2 million, while instead the demand for bicycles increased. Sales of bicycles and parts in fact jumped by 15 percent to €256.3 million for the 6-month period. In terms of volume, bike deliveries rose to 561,000 from 540,000, and their average price went up. Higher sales were recorded in the Netherlands, Belgium, Germany, Austria and Denmark, but they declined in France as Mercier stopped selling to hypermarkets.

Mercier’s French production has been reduced and integrated into the assembly activities of Lapierre. Mercier supplies cheaper bikes to JC Decaux, which develops cycling projects for French cities. It supplies many of those being used in one such project launched in Paris last July 15, but they are largely produced at Accell’s plant in Hungary, whose capacity was doubled early this year.

In Germany, the group combined the back office activities of Winora and Hercules, but is keeping their sales organizations separate. Total sales grew by 20 percent in Germany to €62.1 million during the period. In the USA, Accell’s newly acquired company, Seattle Bike Supply (SBS), recorded good progress and started a bicycle range for adults.

Thanks to lower personnel costs and stability in marketing expenses, which remained at around 3 percent of revenues, the group improved its operating profit to €25;471;000 from €17,547,000 in the year-ago period. Net profit from ordinary activities grew by 52 percent to €16,060,000, but a provision or a fine due to be imposed by Dutch anti-trust authorities depressed it to €11,450,000.

 

 

The fine relates to an old case of price fixing. Last July 18, a Dutch court of appeals reduced the original fine assessed against Accell from €11.5 million to €4.6 million. Nevertheless, Accell says it is considering an appeal at a higher court as it continues to feel guilty in the case. Excluding the provision, the management is budgeting a 35 percent increase in earnings for the full year.