EQS-News: HORNBACH Group delivers strong Q1 2024/25 results increasing earnings per share y-o-y by 44% – full-year outlook confirmed unchanged

HORNBACH Group delivers strong Q1 2024/25 results increasing earnings per share y-o-y by 44% – full-year outlook confirmed unchanged

• Consolidated net sales increased by 1.8% in Q1 2024/25 due to favorable weather conditions counterbalancing effects of the ongoing challenging consumer environment
• Adjusted consolidated operating earnings (EBIT) increased by 33.8% to EUR 146.4 million due to normalized gross margin and cost discipline
• Full-year outlook confirmed unchanged in light of still subdued customer sentiment: Net full-year sales expected slightly above 2023/24, adjusted EBIT projected to be at the same level or slightly above 2023/24

 
Table 1: Key figures HORNBACH Holding AG & Co. KGaA Group

¹⁾ Excluding currency items; including BODENHAUS and online sales
²⁾ Adjusted to exclude non-operating income and expenses
Rounding up or down may lead to discrepancies between percentages and totals. Percentage figures calculated on basis of EUR 000s.
 

Bornheim (Palatinate), Germany, June 25, 2024.

The HORNBACH Group (HORNBACH Holding AG & Co. KGaA Group; ISIN: DE0006083405) reported strong figures for Q1 2024/25 (March 1, 2024 to May 31, 2024). Consolidated net sales increased by 1.8% to EUR 1,805.7 million as good weather in March and April partly outweighed the continued effects of customer caution regarding big-ticket and discretionary categories. Adjusted EBIT was up significantly y-o-y by 33.8% to EUR 146.4 million based on improved top line in March and April, an improved gross margin and ongoing cost discipline. Accordingly, earnings per share in Q1 2024/25 increased to EUR 5.96 from EUR 4.15 in the previous year. For FY 2024/25 HORNBACH continues to expect sales slightly above the previous year’s level (EUR 6,161 million) as well as an adjusted EBIT at or slightly above the level of the 2023/24 financial year (EUR 254.2 million).

“Warmer weather across Continental Europe in March and April as well as the strong commitment of our colleagues positively impacted customer engagement and sales in the first quarter, particularly our sales of plants and gardening products. Our earnings, as expected, significantly improved compared to last year’s quarter which was affected by cold and rainy spring weather. However, we remain a bit cautious as we need to evaluate customer appetite for renovation projects over summer, also in light of international sporting events we have in Europe in the next months,” commented Erich Harsch, CEO of HORNBACH Baumarkt AG.

Albrecht Hornbach, CEO of HORNBACH Management AG added: “We should see a positive impact on our business as inflation and interest rates continue to fall and consumer sentiment lightens up. The improving macroeconomic conditions, however, are not yet translating into higher spending, especially with regard to big-ticket, long-term projects. Therefore, we keep our guidance unchanged for the time being.”

At HORNBACH Baumarkt AG, the largest operating subgroup, net sales increased by 2.6% to EUR 1,711.4 million (Q1 2023/24: EUR 1,667.6 million). On a like-for-like basis and exchange rate adjusted, sales increased by 2.5% in Q1 2024/25 (Q1 2023/24: -3.2%). As of May 31, 2024, the subgroup operated a total of 171 DIY megastores with garden centers and online shops in nine European countries.

Net sales in Germany saw slightly stronger recovery

In Germany, net sales of HORNBACH Baumarkt subgroup increased by 2.8% to EUR 831.2 million in the first quarter (Q1 2023/24: EUR 808.5 million). Like-for-like sales were up 2.9% (2023/24: -5.7%). Net sales outside of Germany grew by 2.4% to EUR 880.1 million (Q1 2023/24: EUR 859.2 million). On a like-for-like basis and exchange rate adjusted, sales in Other European Countries increased by 2.1% (Q1 2023/24: -0.8%). The international share of sales of HORNBACH Baumarkt AG subgroup stood at 51.4% (Q1 2023/24: 51.5%).

Online sales (including Click & Collect) accounted for 12.4% of HORNBACH Baumarkt’s total sales in Q1 2024/25 (Q1 2023/24: 13.3%), remaining well above pre-Covid levels. Compared with the previous year’s quarter, online sales declined by 4.0% to EUR 212.6 million in Q1 2024/25.

The HORNBACH Baustoff Union GmbH (HBU) subgroup continued to be affected by the ongoing weakness in the German construction industry and recorded sales of EUR 95.7 million in the first quarter (Q1 2023/24: EUR 105.4 million). The subgroup currently operates 38 builders’ merchant outlets in south-western Germany and in France close to the German border.

Earnings significantly improved compared to last year’s Q1

The adjusted EBIT of HORNBACH Group increased by 33.8% to EUR 146.4 million (Q1 2023/24: EUR 109.4 million) based on a more favorable spring season compared to the previous year. As such, the adjusted EBIT margin in Q1 2024/25 improved to 8.1% (Q1 2023/24: 6.2%). Gross margin came in at 35.4% (Q1 2023/24: 33.6%) as it continued to benefit from normalized core commodity prices as well as good weather in March and April, leading to a  healthier product mix. While operating costs were affected by higher wages, overall costs increased slower than sales due to the Group’s ongoing focus on cost discipline.

Adjusted EBIT in the HORNBACH Baumarkt subgroup increased by 40.1% to EUR 135.2 million (Q1 2023/24: EUR 96.5 million). HORNBACH Baustoff Union subgroup reported adjusted EBIT of EUR 2.0 million (Q1 2023/24: EUR 2.8 million) and HORNBACH Immobilien subgroup recorded EUR 15.9 million (Q1 2023/24: EUR 16.3 million).

Earnings per HORNBACH Holding share increased to EUR 5.96 (Q1 2023/24: EUR 4.15).

HORNBACH confirms cautious outlook for 2024/25

Based on a weaker start into Q2 in June and in light of still subdued customer sentiment, HORNBACH confirms the outlook given on May 22, 2024. The Group continues to expect net sales in the financial year 2024/25 slightly above⁶⁾ the previous year’s level (EUR 6,161 million) and adjusted EBIT at or slightly above⁶⁾ the level of the 2023/24 financial year (EUR 254.2 million) with gross margins stabilizing at the current higher levels.

As outlined on May 22, 2024, despite continued cost discipline, further cost increases are inevitable, which will largely result from salary adjustments following the high inflation rates in the previous year.

Table 2: Miscellaneous key figures HORNBACH Holding AG & Co. KGaA Group

³⁾ Of which 169 HORNBACH DIY stores with garden centers and two BODENHAUS outlets
⁴⁾ Sales area BHB: Closed building (warm or cold): 100%; covered open space (cold): 50 %; building material drive-in (cold): 50 %; non-covered open space (cold): 25 %.
⁵⁾ Number of employees including passive employees
⁶⁾ Guidance nomenclature:
Sales “at previous year's level” = -1% to +1% | “slight” = +/- 2% to +/- 5% | “significant” = changes of more than 6%.
Adj. EBIT “at previous year's level” = -5% to +5% | “slight” = +/- 5% to +/- 12% | “significant" = > +/- 12%.

Note
The Quarterly Statement of the HORNBACH Holding AG & Co. KGaA Group for Q1 2024/25 is available online at: www.hornbach-holding.de.

The analyst and investor update call is scheduled for 8:30 AM CEST today (English). A live broadcast is accessible via the following link: https://channel.royalcast.com/landingpage/hornbach/20240625_1/
 

About HORNBACH Group

HORNBACH Group is an independent, family-run retail group under the umbrella of HORNBACH Holding AG & Co. KGaA, which is listed on the Frankfurt Stock Exchange and represented in the SDAX. The largest subsidiary, HORNBACH Baumarkt AG, operates 171 DIY megastores with garden centers (incl. specialist stores) and online shops in nine European countries. The Group also includes HORNBACH Baustoff Union, a regional builders' merchant company with 38 locations in southwestern Germany and France, as well as HORNBACH Immobilien AG, which develops retail real estate for the Group. In the financial year 2023/24 (reporting date: February 29, 2024), the HORNBACH Group generated net sales of EUR 6.2 billion, making it one of the five largest DIY and garden retail companies in Europe. The Group has a workforce of around 25,000 employees.

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