In the light of the strong business growth in the first nine months of the year and the higher level of orders on hand, the Mettlach-based group has confirmed its revenue and profit growth forecasts for the full year 2022.
Despite the global economic impact of the ongoing war in Ukraine and the decline in consumer purchasing power due to the high level of inflation, Villeroy & Boch reported positive third-quarter revenue growth of 1.3% to €238 million. This result, combined with the sharp acceleration in the first half of the year, enabled the Mettlach, Germany-based group to achieve revenue of €728.3 million in the first nine months of 2022, 6.4% up on the same period in 2021.
EBIT also rose to €64.3 million as of 30 September 2022 (up 9.7% over the first nine months of 2021), mainly due to higher revenues, while orders on hand increased by €6.5 million year-on-year to €171.7 million. The Bathroom & Wellness Division accounted for €140.9 million of this figure, while the remaining €30.8 million was attributable to the Dining & Lifestyle Division. In the light of these good results, the Management Board of Villeroy & Boch is confident that it will be able to achieve its forecasts for revenue, earnings and the operating return on net assets for 2022 as a whole.
Strong growth across all divisions
The Bathroom & Wellness Division generated revenue of €506.3 million in the first nine months of 2022, up 6.0% on the previous year, thanks to revenue growth in all business areas. Ceramic sanitaryware saw a significant increase in revenue of €23.3 million or 8.0%, with new products proving particularly successful in the German market. Substantial revenue growth was also achieved in the Chinese market, especially in the project business. Despite the additional cost burden resulting from the sharp rise in material and energy prices, the division closed the first nine months of 2022 with an EBIT of €53.9 million (up 7.4% on the €50.2 million in the same period the previous year).
The Dining & Lifestyle Division generated revenue of €219.5 million in the first nine months of 2022 (+7.3%), with encouraging revenue growth recorded in all regions. EBIT also increased, reaching €12.6 million (+8.6%). The division’s sales channels saw heterogeneous development. Revenue at its own retail stores (+€8.8 million) and with retail outlet partners (+€6.8 million) increased substantially compared to the previous year. This is consistent with the trend observed in many other industries, with demand shifting back from e-commerce to physical retail following the lifting of pandemic restrictions. Accordingly, e-commerce revenue declined compared with the extraordinarily strong prior year figure (-€9.4 million) but remains significantly above the pre-pandemic result and thus continues to be at a high level.
The hospitality business saw particularly strong growth (+€9.3 million) on the back of a pronounced focus on the high-end segment.
Increase in investments
The Group made investments of €18.6 million in the first nine months of 2022 compared to €11.9 million to 30 September 2021. The Bathroom & Wellness Division accounted for €11.6 million, mainly for the glazing lines at the sanitaryware plants in Hungary and Romania, new pressure casting machines in Hungary and new bathtub moulds in Belgium.
Investments in the Dining & Lifestyle Division (€7 million) mainly related to maintenance and modernisation of the production facilities in Merzig and Torgau. The Mettlach 2.0 project was also continued.