Accell’s sales are boosted by e-bikes and North America

In reporting its financial results for the past year, René Takens, chief executive of Accell Group, indicated that it may use the €20 million earned from last month's sale of Hercules to ZEG for other acquisitions. it will actively seek potential acquisitions that are a good fit with its profile and brand portfolio, while continuing to optimize cooperation among its current brands.

The Dutch bike group saw its turnover increase by 10 percent to €849 million in 2013, driven by strong demand for e-bikes in Europe and sales growth in the North American market. The increase was lower than expected, the company said, due to lower consumer spending and unfavorable cold weather in the spring, although revenues were higher compared with 2012 in virtually all markets.

Net profit came in at €19 million, down from €23.3 million in 2012, due to one-off reorganization costs in the Netherlands and North America as well as higher financing charges and higher tax charges. Accell Group owns an array of brands internationally including Raleigh, Seattle Bike Supply, Diamondback, Winora, Sparta, Batavus and others.

The number of bikes sold increased by 14.3 percent to 1,835,000, but the average price fell from €345 in 2012 to €336 in 2013 due to the acquisition of Raleigh, which sells a higher proportion of bikes in the mid-market segment, and higher discounts in the second half of 2013. Sales of e-bikes rose by 23 percent and accounted for 35 percent of the group's total bicycle sales in 2013, compared with 32 percent in 2012. Turnover in traditional bikes was up 7 percent. Sales of sports bikes grew by 6 percent.

In the Netherlands, turnover from bicycle sales increased by 3 percent in value while volumes fell by 3 percent. The group has begun the process of integrating Sparta's bicycle production facility in Apeldoorn and the Batavus production facility in Heerenveen into the Heerenveen location, which will be completed in 2014.

In Germany, sales were up 6 percent to €202 million, largely driven by an increase in e-bike sales, very popular in the country. The sale of Hercules, whose profit margins have been shrinking will enable the company to concentrate more clearly on its other brands in Germany. In the rest of Europe, sales were up 16 percent to €270 million.

In North America, the group's sales increased substantially, in particular in the multisport channel, an important sales channel for the group. North America accounted for €129 million in revenues in 2013, up 16 percent from the prior year. Sales of e-bikes in the region were up, though the company acknowledged that this remains a relatively small market in that part of the world. Sales of bicycle parts and accessories declined and the company began to phase out the sale of electric mini scooters.

Accell has dramatically increased its presence in North America since its 2012 acquisition of the Raleigh and Diamondback brands. In the U.S., Accell Group companies have intensified cooperation and will continue the process of combining their operations to form a single company. The closure of the production facility in Canada has been completed and from 2014, the Canadian operations will focus on sales under the Raleigh brand to specialist bicycle dealers.

Outside Europe and North America, the group recorded turnover growth in Turkey and the Far East. The global licensing income from the Raleigh brand increased slightly, in line with expectations.

For 2014, Accell Group is looking at further sales growth, as longterm trends suggest that cycling will remain highly popular in the years to come, for mobility purposes as well as recreational and sports purposes. Sales of e-bikes are expected to continue to grow.