MOLESKINE SPA 2015 Net Sales target of € 115 - 120 million confirmed on the back of fourth quarter
2014 momentumMilan, 5 February, 2015 - The Board of Directors of Moleskine S.p.A. ("Moleskine" or with its controlled companies the "Group" or the "Company") today has reviewed the preliminary consolidated net sales results for the full year 2014. The final draft of the financial statements will be approved by the Board of Directors at a meeting to be held on March 11, 2015.
Net Sales1 of € 98,7 million represents an increase of 13,1%2 at constant exchange rates vs. full year 2013 led by an expected accelerated perfomance in fourth quarter 2014 (+28% vs. fourth quarter 2013), driven by all geographies and distribution channels.
Arrigo Berni, Chief Executive Officer of Moleskine, commented:"In 2014 we delivered on the growth expectations we had set.
I believe this is particularly important, when we consider the challenges we had to face. On the one end, an unfavourable macroeconomic environment, particularly in EMEA. On the other, the complexities of dealing with the changes we made to a relevant part of our wholesale channel, where we seized on the opportunity to strengthen our distribution model in key markets.
The fact that we continued to grow despite these challenges speaks about the strength of our strategy, the dedication of our people and the multiple opportunities ahead.
The solid sales results we have seen in 2014 support our confidence that we can also deliver on profitability targets for the year. This, in turn, reinforces our belief that we will continue to deliver growth in the years ahead, aligned with our stated business plan ."
1 Net Sales are reported on an adjusted basis and are defined as Net Sales net of Net Sales from display, of exchange differences on sales and other Net Sales which are not directly related to the ordinary business
2 At constant exchange rates. See tables for growth rates on actual exchange rates
1
Moleskine sells its products (i) indirectly through a network of 76 distributors (''Wholesale'') which serve bookstores, department stores, specialty stores, stationery stores and museums ("Retailers"); (ii) through a mixed model, direct and indirect, to business customers (''B2B''),
iii) through website sales (''e-Commerce'') and (iv) through a growing network of Directly
Operated Stores ("Retail" or "DOS").
In thousands of Euro % % At Curr. FX At Const. FX
Wholesale 68.160 69,1% 63.087 72,5% 8,0% 7,7% B2B 18.421 18,7% 15.818 18,2% 16,5% 16,5% E-commerce 4.142 4,2% 3.680 4,2% 12,5% 12,6% Retail 7.949 8,1% 4.420 5,1% 79,9% 78,4%
During full year 2014 net sales growth was recorded across all channels as follows:
Net Sales in the Wholesale channel increased by +7,7% vs. full year 2013 with a particularly strong fourth quarter in all geographies in line with expectations. Total number of doors increased to ca. 26.500 at the end of 2014 (vs ca. 25.000 at the end of 2013) with 1.500 net additions and the network Ateliers increased to 188 (vs 155 at the end of 2013). In particular:
- EMEA grew by +1,6% vs. full year 2013 with in-line performances across the region, despite a difficult retail environment. Healthy performances in key countries such as the UK and France were partially offset by i) the situation in Russia linked to Ruble devaluation and ii) Germany reflecting the phase out of the previous distributor. This latter effect should now be accounted for and the benefits of the new distribution platform are expected to positively impact 2015 for the full twelve months.
- Americas grew by +17% vs. full year 2013 reflecting the change in distribution model which led to a more focused distribution platform in the US starting January 2014. Direct management of key accounts representing ca 50% of sales in the area delivered positive performances.
- APAC grew by +5,5% vs. full year 2013 led, as expected, by the strong fourth quarter results (+48,8% vs. fourth quarter 2013). This reflected mainly the launch of activities by new distributor in Japan and the healthy performances in South East Asia, mainly Australia and Korea.
3 Net Sales by channel are reported on an adjusted basis excluding Net Sales from displays, income/loss from exchange rate and other Net
Sales. Also Net revenues are reported at constant exchange rates; see tables for growth rates on actual exchange rates
2
Net Sales in the B2B channel rose by 16,5% vs. full year 2013. Growth was very strong across all geographies as an increasingly proactive sales approach by our direct sales force delivered an increase in the average value of projects while we continued to expand the indirect distribution model. APAC (+54,8% vs. full year 2013) showed the strongest set of results driven by a large Korean project which more than offset the negative performace of Japan and Hong Kong, which were affected by the end of the distributor relationship in the Wholesale channel. In EMEA (+7,6% vs. full year 2013), strong growth in the last quarter in Germany and France was partially offset by more moderate growth in Italy and the UK due to large orders in the last quarter of 2013 which did not occur this year. The Americas grew by 12,8% vs full year 2013 as the region was able to continue to capitalize on the indirect distribution model now in place.
Net Sales in the e-Commerce channel showed 12,6% growth vs. full year 2013 driven by EMEA (+13,1% vs. full year 2013) and APAC (+82,5% vs. full year 2013) reflecting continued strong growth in China. Americas (+4% vs. full year 2013) recovered thanks to a very a strong fourth quarter (+27,8% vs. fourth quarter 2013) following first nine months impacted negatively by an unfavourable comparable base linked to the Evernote effect.
The Retail channel continued to grow across all geographies, reaching net sales of € 7,9 million in full year 2014, driven by planned perimeter expansion. In 2014 there were 22 openings and 11 closures, netting a total of 41 DOS at the end of 2014 (vs. 30 at the end of
2013). The closures were largely temporary stores which were used to validate specific shopping areas, in view of permanent openings.
The opening of 22 DOS in 2014 follows the opening of 23 DOS in 2013 thus confirming the sustainability of our opening plan at a pace of about 20 new stores per year. The Company will continue to invest in the organization to support healthy development of this strategic channel to Moleskine's long term growth.
Retail and e-commerce's contribution to FY14 Net Sales increased to 12% (vs. 9% in FY13) which is consistent with Moleskine's strategy to increase the weight on sales of direct to consumer channels.
In full year 2014 all geographies continued to contribute positively to Moleskine's revenue
growth:
In thousands of Euro % % At Curr. FX At Const. FX
EMEA 49.172 49,8% 45.978 52,8% 6,9% 6,3% AMERICAS 35.440 35,9% 30.184 34,7% 17,4% 17,4% APAC 14.060 14,2% 10.843 12,5% 29,7% 29,7%
4 Net Sales by geographical area are reported on an adjusted basis excluding Net Sales from displays, income/loss from exchange rate and other Net Sales. At constant exchange rates; see tables for growth rates on actual exchange rates
3
Net Sales in EMEA increased by +6,3% vs. full year 2013 at constant exchange rates driven by all channels despite a more cautious retail environment across the region.
Net Sales in Americas continued to deliver solid double digit growth and increased by 17,4%, compared to full year 2013 mainly driven by the strong operating performance of the new distribution platform in Wholesale.
Net Sales in APAC were up 29,7% compared to full year 2013 mainly driven by the start up of the new distributor in Japan, the direct retail roll-out on the Chinese Mainland and the establishment of a strong B2B business in the region.
During 2014, the Group continued to increase the depth of its product offering through the launch of novelties within the Paper, WTR ("Writing, Travelling & Reading") and Hybrid collections ("products bridging the analog and digital worlds").
In thousands of Euro
% %
Paper Collection 90.408 91,6% 80.829 92,9% WTR Collection 8.264 8,4% 6.176 7,1%
At Curr. FX
11,9%
33,8%
13,4%
In the Paper collection, the Group continued to innovate, launching, among others, new colour ranges and Limited Editions.
In 2014, WTR accounted for 8,4% of net sales, up from 7,1% last year driven by the strong growth in the direct to consumer channels but also improving performance in the Wholesale channel.
In 2014, the Company announced that it signed a multi-year licensing agreement in the mobile device accessories space. This will lead to a further increase in the product offering with a full line of Moleskine branded smartphone and tablet cases and PC sleeves, with distribution though the Company's direct channels and retail chains thus further raising the visibility and awareness of the Moleskine brand.
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The Company has reported results in line with expectations for 2014. On the back of these results and current trading the Company is confident it can deliver on top line expectations for the full year 2015 announced at the meeting of the Strategic Plan 2014-16 on 10th March
2014. The forescast for 2015 is to reach full year revenues between €115-120 million.
The Company anticipates a favourable foreign exchange environment in the year ahead and forecasts that a 10% strengthening of the US dollar against the Euro would increase the top line by ca. 4% and net profit by ca. 2%.
The Company adopts a policy aimed at matching purchases and sales in the same currency, mainly US dollar, thereby mitigating the risk of fluctuations in exchange rates (so-called natural hedging).
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Unaudited data
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Statement by the manager responsible for the preparation of the Company's financial documents
The manager responsible for the preparation of the Company's financial documents, Mr. Alessandro Strati, hereby declares, in accordance with paragraph 2 article 154 bis of the "Testo Unico della Finanza", that the accounting information contained in this press release
corresponds to the accounting results, registers and records.
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This press release may contain "forward-looking statements", which includes all statements
that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations,
projections and provisional data concerning future events and are subject to a number of
uncertainties and other factors, many of which are outside the control of the Group. There are a variety of factors that may cause actual results and performance to be materially different
from the explicit or implicit contents of any forward-looking statements and thus, such forward-looking statements are not a reliable indicator of future performance. Moleskine
undertakes no obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise, except as may be required by applicable law. The information and opinions contained in this press release are provided
as at the date hereof and are subject to change without notice. Moreover, reference to past
performance of the Company or the Group shall not be taken as an indication of future performance.
This press release contains certain non-IFRS alternative financial indicators which the Company's management uses as supplemental indicators to monitor the economic, financial and operating performance of the Group.
Such indicators are not recognized as measures of financial performance or liquidity under IFRS, do not have any standardized meanings prescribed by IFRS and therefore may not be comparable to the calculation of similar measures used by other companies, and should not be viewed as alternatives to measures of financial performance calculated in accordance with
IFRS. Therefore, investors should not place undue reliance on such data and information.
In addition, this press release includes certain ''Adjusted'' financial and operating indicators
and other measures, which have been adjusted to reflect extraordinary events, non-recurring
transactions and activities which are not directly related to the Group's ordinary business. Such "Adjusted" information has been included to allow a better comparison of financial information across the periods; however, it should be noted that such information are not recognized as measures of financial performance or liquidity under IFRS and/or do not constitute an indication of the historical performance of the Company or the Group. Therefore, investors should not place undue reliance on such data and information.
Olga Bologna
+39 0200680599
ir@moleskine.com
FTI Consulting
Matt Dixon / Harry Staight
+44 (0)20 7831 3113 moleskine@fticonsulting.com
Moleskine® was created as a brand in 1997, bringing back to life the legendary notebook used by artists and thinkers over the past two centuries: among them Vincent van Gogh, Pablo Picasso, Ernest Hemingway, and Bruce Chatwin. A trusted and handy travel companion, the nameless black notebook held invaluable sketches, notes, stories, and ideas that would one day become famous paintings or the pages of beloved books. Today, the name Moleskine encompasses a family of objects: notebooks, diaries, journals, bags, writing instrum ents and reading accessories, dedicated to our mobile identity. Indispensable companions to the creative professions and the imagination of our times, they are intimately tied to the digital world. Since 1 January 2007, Moleskine has also become the name of the company which owns the worldwide trademark rights for the brand. Moleskine develops, markets and sells a variety of tools for the creative class and others that provide open platforms for creativity and communication, contributing to the expansion and dissemination of culture and knowledge. The company grew out of the experience of Modo&Modo, a small Milanese publisher that in 1997 created the Moleskine® trademark. In the fall of
2006, Modo&Modo was purchased by SGCapital Europe, now Syntegra Capital, with the objective of fully developing the potential of the
Moleskine brand. Since April 2013 Moleskine is listed at the Borsa Italiana, the Italian stock exchange.
Moleskine is a creative company enjoying continuing growth. It has about 200 employees and a vast network of partners and consultants. Its home office is in Milan, Italy. Moleskine Group includes Moleskine America, Inc. (established in 2008) and Moleskine Asia Ltd (2011), and has full control over Moleskine Shanghai and Moleskine Singapore, Moleskine France (2013) and Moleskine Germany (2013). All subsidiaries are wholly-owned.
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