A growing market for bike parts and accessories helped Accell Group to raise net sales for the six months to June 30 by 3.3 percent to €699.1 million, despite a drop in sales of finished bicycles due to supply and logistics problems. Order books for electric bikes remained strong, but their sales fell by 6 percent during the period due to critical component shortages caused by the Covid pandemic.
The owner of the Babboe, Batavus, Ghost, Haibike, Lapierre and Winora brands said lower discounts and higher prices resulted in a gross margin expansion of 2.5 percentage points to 30.1 percent. It also led to an increase of 2.1 percentage points in the operating margin (Ebit) to 8.7 percent. Net profit jumped by 54 percent to €44.2 million from €28.6 million in the year-ago period.
Sales of traditional bikes declined by 7 percent, while sales of cargo bikes came in 43 percent higher and represented 4 percent of total net sales. Total revenues from bicycles were off by 5 percent to €490.7 million. Revenues from parts and accessories rose by 29.3 percent to €208.3 million.
In Germany, Austria, Switzerland and Eastern Europe, the Dutch-based group’s sales slumped by 15.4 percent to €198.1 million as component shortages hit the sports segment, with only limited alternatives available for critical Winora parts. In Germany alone, sales were down by 10 percent to €205.3 million. Sales were relatively stable in the Benelux countries, down only 0.2 percent, as the company managed to source substitute supplies.
“Despite lockdowns and closed bike shops in various countries in the first four months of the year, demand for bikes and parts & accessories remained strong across Europe and segments,” said Accell’s CEO, Ton Anbeek.
In other regions, including France, the U.K., Ireland, the Nordics and other countries, bicycle sales rose by 7.9 percent, mainly driven by stronger sales in France and helped by a low first-half 2020 comparison due to lockdowns.
The working capital was up by almost a third to €390.1 million in the first half due to supply chain constraints after “exceptionally low” inventory levels due to higher demand for Accell’s products, combined with the parts shortages.
Looking forward, Anbeek said Accell was on track to deliver on its 2022 targets, backed by a strong bicycle market, the company’s strong portfolio and actions being taken in terms of supply, sales and operations planning.
He added that order books were “strong and well-filled” and expected that the traditional bike season would extend into the second half of 2021. “The electrification of the bicycle, cycling infrastructure investments, government fiscal incentives and subsidies will remain solid growth drivers for the years to come,” he said.
However, Anbeek cautioned that supply chain issues would continue and sales levels for bikes, parts and accessories “will be strongly dependent on the timely arrival of certain components, particularly from the Asia region where the spread of the Delta variant has been prompting new lockdowns recently.”
