Delticom “well prepared” for second-half following Q2 growth
Although Delticom reports the summer tyre trade in Europe has so far “lagged behind expectations”, the company behind mytytres.co.uk and some of Europe’s other best-known online tyre retail portals increased its year-on-year revenues and earnings during the second quarter of 2011. April was admittedly described as being a comparatively weak month for Delticom, yet the company says it managed to offset this with positive figures in May. The following month delivered a noticeable year-on-year increase in tyre sales, Delticom added.
During the second quarter, Delticom generated revenues of 112.9 million euros, up 9.72 per cent on the second quarter of 2010 – a quarter Delticom describes as a “strong base” to grow from. As a result, year to date revenues amounted to 198.3 million euros by the end of June 2011, a rise of 11.8 per cent on the previous year. Revenues for the company’s E-Commerce division increase 12.0 per cent year-on-year in the first half of 2011 to 190.1 million euros while Wholesale division revenues grew 7.3 per cent to 8.2 million euros. During this period, other operating income decreased 7.7 per cent to 3.1 million euros.
In the first six months of 2011 Delticom’s gross profit grew 10.8 per cent year-on-year to 56.9 million euros. The company refers to the Pan-European demand situation as having been “challenging”, yet notes it largely passed on purchase price increases to its customers. Consequently, Delticom’s second quarter gross profit came in flat year-on-year at 29.0 per cent. For the first half of the year the gross profit margin decreased only slightly, from 28.4 per cent to 28.3 per cent.
Last year’s second quarter earnings before interest and taxes (EBIT) rose +43.9% to 10.9 million euros. Nevertheless, against the backdrop of a stable gross profit margin, EBIT for the second quarter of this year increased 19.6 per cent year-on-year to 13.0 million euros. This translated to a quarterly EBIT margin of 11.5 per cent, up from 10.6 per cent in the second quarter of 2010. EBIT for the first half came in at 19.1 million euros, a year-on-year increase of 14.4 per cent, while the EBIT margin of 9.7 per cent was 0.3 per cent higher than a year earlier.
Delticom states it is “well prepared” for the coming quarters: “Our new warehouse has allowed us to stock up for the upcoming months more aggressively than originally envisioned,” stated Delticom CFO Frank Schuhardt. “Compared to last year, we are now in a better position to offer our customers attractively priced tyres throughout the entire winter.” Even though 2010 gave the company what it calls a strong base, management expects both sales volume and revenues to increase in the fourth quarter, assuming normal winter weather conditions. “We remain on track,” Schuhardt added. “Our plans call for around 10 per cent revenue growth in 2011 and an EBIT margin of around one percentage point lower than in 2010.”