BHS tabletop : records excellent figures for the financial year

Press release

2016 business year:

BHS tabletop AG records excellent figures for the financial year

Sales rise to €121 million / Higher operating income (EBIT) / Greater number of employees / Strategic range concept Playground for the trend-oriented food services industry / New annealing furnace: major investment in Schönwald

Selb, 6 March 2017. The publicly listed company BHS tabletop AG, global market leader in professional porcelain, remains on the road to success and continues to report profitable growth despite the extremely price-driven and global nature of its competition. During the past financial year, the company recorded a six per cent increase in revenue - from €114.2 million to €121.0 million. Adjusted for currency translation effects, the increase in revenue amounts to around eight per cent. EBIT rose from €2.8 million (2015) to €5.8 million during the same period. Adjusted for special effects based on the acquisition of the British subsidiary John Artis during each year, operating EBIT rose from €5.5. to €5.7 million.

Annual net profit, which was heavily influenced by the special effect mentioned, rose from €700,000 to €3.6 million.

The highly positive financial figures are based on successful export operations in over 120 countries, continued stable domestic demand and successful product innovations. As of 31 December 2016, BHS had 1,189 employees at its sites in Schönwald, Selb and Weiden, a significant increase on the previous year's figure of 1,154. In this respect, BHS sets itself apart from its competitors in an industry where employee numbers are on the decline.

Christian Strootmann, CEO of BHS: 'In 2016, we demonstrated once again that profitable porcelain production in Germany based on the highest quality standards can prevail against suppliers from low-wage countries. To do so, global service and logistics concepts and technologically sophisticated customer solutions are

required. This strategic alignment will enable BHS to position itself as a reliable tabletop specialist and solution provider. We want to expand on our leading position and respond to the needs of our customers to an even greater degree in the future.'

New Playground range concept for the trend-oriented food services industry Consequently, BHS tabletop AG has continued its strategic development from a porcelain producer to an innovation-driven supplier of holistic tabletop solutions in

all restaurant and catering segments. At the end of the year, the company launched Playground - an independent range based on attractive materials such as recycled leather placemats, glass, slate and wood, which can be excellently combined with the individual modern porcelain collections of the three brands Bauscher, Schönwald and Tafelstern. This is based on the idea that beautifully covered tables will present an entertaining way to establish creative presentations ('Playground'). As an independent range featuring exciting items and accessories, Playground is setting new innovations in the trend-oriented food services industry. 'We have seen that we need to offer solutions for rapidly changing market trends. Playground offers BHS additional sales opportunities,' says Christian Strootmann. 'Playground allows us to acquire new customers, which in turn helps us to market our hard porcelain products.'

Porcelain for Hollywood stars and for a wellness oasis in the Fichtelgebirge All three brands recorded excellent sales results again in 2016, with new clients of regional and global renown. Purity from Bauscher recently made its way to 16 exceptional residences on the Fregate Islands, part of the Seychelles. The exclusive islands are a popular residence of Hollywood stars.

Siebenquell GesundZeitResort offers a magical South Pacific feel in the midst of the Bavarian Fichtelgebirge. A superior four-star hotel offers the appropriate accommodation. Schönwald won the hotel catering contract here with its design line Allure. The Connect line was provided in the employee canteen.

The international sales team at Tafelstern won a special project, as the brand was chosen as the official partner of Four Seasons. The prestigious hotel chain opened two luxury hotels in Bogotá, marking the first Four Seasons hotels in Colombia.

Both hotels were outfitted with the classic line Marie Christine with special decor as well as with the Avantgarde and Coffeelings collections.

Successful American activities on the market

BHS took another successful step forward in its American operations in the past year. The American subsidiary BauscherHepp, Inc. and the sales cooperation with the American drinking-glass producer Libbey, which distributes the Schönwald brand in the US market through its distribution channels, have both developed positively. BHS thus recorded an 8.8 per cent increase in sales in the US market, rising from €15.9 million to €17.3 million.

In the United Kingdom, the Brexit discussions in the middle of last year led to significant market uncertainty, with the pound sterling going into decline. Consequently, overall revenue of the British subsidiary John Artis Ltd. was lower than in the previous year (€15 million compared to €16.8 million), wholly due to exchange rate effects. Adjusted for currency translation effects, Artis slightly increased its sales by 0.4 per cent compared to the previous year.

High investment: next major project adopted

BHS made investments of €5.2 million in its operating sites in Schönwald, Weiden and Selb in the last financial year. The commissioning of a combined heat and power system (CHP) in Schönwald represented a milestone in terms of energy efficiency. An additional adornment automation system was acquired in Weiden in 2016, adding handles to up to 15,000 cups every day. In conjunction with the subsidiary company Tools & Technologies, the plant was further developed to ensure that it meets the high production standards required.

BHS will again provide major investment in the current business year, with the acquisition of a new annealing furnace in Schönwald. BHS is estimating an investment of €4.5 million for this project alone. The existing annealing furnace will be replaced by a new one by the end of the year, shortening furnace time and using considerably less energy. The new annealing furnace is designed for a burning capacity of up to 13 million units per year.

The company is planning investments totalling €8.8 million in 2017.

Outlook: BHS remains cautiously confident

In light of the protectionist tendencies in the USA, the as yet unforeseeable consequences of Brexit and terrorist threats which continually impact travel patterns, forecasts are uncertain according to Christian Strootmann. 'The negative potential based on these geopolitical risks is high for the German economy as a whole. However, we feel that BHS has a very strong position and, in the case of stable conditions, we remain confident that we will continue to grow in 2017.'

For more information, please contact: Frank Schroedter, Engel & Zimmermann AG

Unternehmensberatung für Kommunikation, 82131 Gauting, Germany Tel.: [phone], Fax: [phone]

Email: [e-mail]