Distributor ALSO predicts a significant rise in full year profits as it reports the first nine months of the 2016 financial year. While sales increased to €5.58bn compared to €5.48bn (+ 1.9%) in the same period last year, the company’s profit rose from €28.4m to €44.5m (+ 56.7%), which benefited among other things from fewer write-offs and the absence of one-time effects from the previous year. Earnings before taxes (EBT) reached €63.6m compared to €45.7m in the previous year (+ 39.2%).
"We are satisfied with these developments. The business is evolving as we had anticipated. We remain confident that our earnings in 2016 will surpass our earnings from the previous year," said Gustavo MöllerHergt, CEO. On account of significant increases for certain operational figures, the company has decided to release its earnings statement for the first nine months of the 2016 financial year, instead of on October 27, 2016 as originally planned.
While sales in the Central Europe segment fell slightly to €3.47bn from €3.61bn (-3.7%), earnings before taxes increased from €31.7m to €54.3m (+ 71.3%). The EBT margin increased from 0.9 to 1.6%. This improvement can be attributed to an enhanced ratio of business operations in the core market of Germany. “The management team has made a deliberate decision to prioritise high margins over some high-volume orders,” said Möller-Hergt.
Northern / Eastern Europe market segment Sales in the Northern / Eastern Europe market segment rose to €2.34bn from €2.02bn (+ 15.7%) in the previous year, with earnings before taxes falling to €10.4m from €22.5m in the same period (-53.8%). The EBT margin amounted to 0.4%, compared to 1.1% in the same period in 2015. As in the previous quarter, ongoing initial investments in Poland, Finland, and the Benelux countries continue to have a short-term negative impact on profitability. “From an operational point of view, our activities in these markets are satisfactory,” said Möller-Hergt.
The previous year’s figures for the segments have been adjusted to reflect the reallocation of ALSO International B.V. and the ALSO Nederland B.V. (Benelux) from the Central Europe to the Northern / Eastern Europe segment. The figures have been calculated on a comparable basis.
ALSO is expecting to increase the company’s profit in the full year 2016 significantly compared to the previous year.