AUSTRIA - The Egger Group, a world leader in the production of wood based panels, with headquarters in St. Johann in Tirol (Austria) was able to use to its advantage the overall economic situation during the first half of the business year 2018-2019 (on 31 October 2018).
It closed with a consolidated turnover of EUR 1.43 billion and an adjusted operative result (EBITDA) of EUR 231.4 million. The outlook for the second half-year is also optimistic.
“In the last six months we were able to use the overall positive economic situation to our advantage. We utilized the capacities of our 18 modern plants and reached these satisfactory turnovers and results together with our now 9,600 employees”, says Thomas Leissing, Head of Finances/Administration/Logistics and spokesperson of the Egger Group Management, on the day the balance sheet is published.
The turnover of the Egger Group for the first half-year 2018/19 was able to reach EUR 1,432.0 million and exceed by 8.2% the previous year’s level. The adjusted EBITDA (result before interest, taxes and depreciation; revaluation in Argentina acc. to IAS 29/inflation balance not taken into account) increased by 4.0 % to EUR 231.4 million. The adjusted EBITDA margin of 16.2% (previous year: 16.8%) is still at a good level.
The largest turnover increase was registered by Egger in the furniture and interior design product segment (Egger Decorative Products). The sales in this segment has grown in all relevant geographic markets as compared to the previous year, and reached a total of EUR 1,222.6 million (+3.8 %). When it comes to flooring (Egger Flooring Products), the market situation remains difficult throughout Europe. Nevertheless, the volumes from the Gagarin (RU) plant increased, particularly on the Russian market. This means the division sales increased to EUR 225.3 million (4.7 %), which corresponds to 14.1% of the total turnover. Egger reports for the first time in its half-year balance sheet the newly created segment “Others”. It includes Group functions, the sawmill in Brilon (DE), and currently the Argentinian plant in Concordia acquired in 2017. This segment has a turnover of EUR 151.1 million and currently contributes 9.4% to the Group turnover.
“These solid results are the basis for further growth: Over recent months, the Egger Group continued its growth investments in almost all plants, including additional finishing capacities or logistics optimizations. This is currently particularly visible in Egger’s 19th plant location in Biskupiec, Poland. Over the past year and a half, we have built there Europe’s most modern wood-based materials plant. The construction and assembly works are now largely completed. We hope to be able to start production in the next few weeks,” says Walter Schiegl, Head of Technology/Production Egger Group. On the other hand, Egger is still only at the beginning of construction in Lexington, North Carolina (US). The ground-breaking ceremony for the production facilities of this greenfield project took place in early November.
For the second half-year, Egger is expecting a stable development in all European markets and Russia. The outlook for the largest product segment, Furniture and Interior Design, is stable across all locations. Ulrich Bühler, Head of Sales/Marketing Egger Group, thinks the challenge for Egger will be the still relatively new market environment in South America: “Primarily the high level of inflation and the currency fall of the Argentinian Peso are challenging. Our objective in this regard is to expand the hitherto regionally restricted sales of this location to other regions of North and South America. We are happy we were able to fully integrate our new Concordia plant into all Group processes.”
