Results 2015/16: Slight growth after challenging financial year

Sales topped DKK 1,850 million against DKK 1,833 million the year before, representing a 1% increase. The repercussions from the introduction of a new ERP system in the second half of the previous financial year impacted sales negatively in Q1 and Q2, and the management therefore decided to lower the sales forecast in the interim report published in December 2015. Operations were largely normalised in the second half, but it was not possible to make up for the losses in the first half as the second half is the group’s low season. The revised outlook was thus for sales of approx. DKK 1.8 billion and an EBIT of approx. DKK 25 million +/- DKK 5 million.

With revenue of DKK 1,850 million and an EBIT of DKK 21 million, the results for the year were thus in line with expectations. Sales growth of 4% in Denmark is satisfactory, while sales outside Scandinavia (primarily Poland and China) are up 10%, and Sweden is posting growth of 0.5%. In Norway, where the market is impacted by a weakening of demand and falling oil prices, sales dropped by 12%. Moreover, exchange rate developments are detracting from revenue in Danish kroner.

The outlook for FY 2016/17 is for revenue of DKK 1.9 billion and an EBIT of DKK 70 million.

Peter Røpke, CEO of Flügger A/S, says: 

“The 2015/16 financial year was a challenging one for Flügger, not least due to the time and money spent implementing a new ERP system. The problems have now been overcome, and the bill has been paid, but our results clearly reflect the fact that the exercise has cost us dearly. We are now looking forward to the next two quarters, which constitute our high season and thereby a chance to deliver positive results. Moreover, we have strengthened both the management and sales management teams in the various countries, and we expect this to have a positive impact on our business.”