Einhell keeps dividend stable and announces promising outlook
In the past financial year 2023, Einhell Germany AG’s performance was satisfactory overall. Despite the difficult macroeconomic environment at the moment and the challenges in the global supply chain, the company can look back on a solid financial year. The Einhell Group reports consolidated revenue of EUR 971.5 million for financial year 2023 (previous year: EUR 1,032.5 million). In particular, the revenue performance was negatively impacted by exchange rate movements of several currencies. Adjusted for PPA effects (purchase price allocation) from the acquisition of the Canadian and Thai subsidiaries, consolidated net profit totalled EUR 77.4 million. The margin before taxes and PPA is 8.0 percent.
Positive cash flow and dividend distribution
As the leading supplier of DIY and garden tools, the Einhell Group’s cash flow has developed very positively over the past financial year. As a result, the cash flow from operating activities amounted to EUR 211.7 million. Net liabilities to banks (bank liabilities less bank deposits) were reduced to just under EUR 10 million despite the acquisition of companies in Thailand and Vietnam. Even though earnings have declined slightly, the company is keeping its dividend at a stable level: the Board of Directors and the Supervisory Board will propose a dividend of EUR 10.82 million to the Annual General Meeting. This corresponds to a dividend of EUR 2.90 per preference share and EUR 2.84 per ordinary share.
Expansion of the supply chain
Driven by the experience of the past few years, Einhell Germany AG will significantly widen its supply chain in future in order to further diversify its sourcing strategies. In financial year 2023, Einhell already expanded its sourcing activities with the takeover of the Vietnamese subsidiary. Over the next few years, the company will work with its strategic partners to establish a supplier industrial park in Vietnam. Another building block in supply chain management is Einhell’s own battery production. “Our group-wide goal is to produce one million batteries this year. And we will also kick off our own battery production in Eastern Europe in 2024,“ says Einhell CEO Andreas Kroiss.
Strengthening the brand
As in previous years, the company continues to focus on strengthening the Einhell brand, which is to be established and expanded internationally. This is significantly aided by co-operations with strong partners with an international presence such as the Mercedes-AMG PETRONAS F1 Team and FC Bayern Munich. In addition to conventional TV campaigns running in several countries around the world, the company plans to significantly increase its social media presence to boost its appeal to younger audiences. “We have the clear aim to grow our social media community into one of the largest in the DIY industry,” says Andreas Kroiss.
Continued international expansion
In June 2023, Einhell Germany AG acquired 66.67 percent of shares in the Thai company Surazinsano Co., Ltd. In addition, it acquired the minority interests in its subsidiaries in Poland and South Africa. In order to be able to reach its medium-term revenue targets, Einhell will continue to expand its international distribution network in the coming years. As part of its international expansion strategy, Einhell is also extending its existing distribution network to the US. To this end, the Board of Directors has already started discussions with suitable takeover partners. “We are convinced that the USA is a particularly interesting market for our product segment,” says Einhell CEO Andreas Kroiss.
Optimistic outlook
“Despite a difficult economic climate, we managed to significantly improve our market position and gain market share in the past financial year. Thanks to our forward-looking strategy and our successful Power X-Change platform, we look to the future with optimism,” adds the Einhell CEO. “Our strong market presence will enable us to continue to generate stable revenues in the markets in which Einhell is already active.” Based on these assumptions, Einhell Germany AG is planning organic revenue growth of around 6.0 percent and a pre-tax margin of around 7.5 to 8.0 percent for the financial year 2024.
About Einhell Germany AG
Einhell is a leading manufacturer of state-of-the-art tools and devices for the house and garden and will be celebrating its 60th anniversary in 2024. From its headquarters in Landau/Isar (Bavaria), the internationally successful company has continuously expanded its innovative rechargeable battery platform Power X-Change and is now the market leader in the area of cordless tools and garden devices. For many years Einhell has set new standards in terms of endurance, performance, and safety. Einhell customers appreciate the freedom of cordless operation for all their DIY projects, as well as the excellent value for money that Einhell products represent and the first-class customer service offered by the company.