HALF-YEAR FINANCIAL REPORT

HORNBACH Holding AG & Co. KGaA

Group

H1

2023/24

(MARCH 1 - AUGUST 31, 2023)

2

HORNBACH HOLDING AG & CO. KGAA GROUP HALF-YEARFINANCIAL REPORT 2023/24

HORNBACH HOLDING AG & CO. KGaA GROUP

Half-Year Financial Report 2023/24 (March 1 - August 31, 2023)

Key figures of the HORNBACH HOLDING AG & Co.

Q2

Q2

Change

6M

6M

Change

KGaA Group

(in € million, unless otherwise stated)

2023/24

2022/23

in %

2023/24

2022/23

in %

Net sales

1,667.9

1,649.9

1.1

3,441.3

3,463.3

(0.6)

of which: in Germany

859.8

864.2

(0.5)

1,771.2

1,822.4

(2.8)

of which: in other European countries

808.1

785.7

2.8

1,670.2

1,641.0

1.8

Like-for-like sales growth (DIY)1)

1.0%

(1.7)%

(1.3)%

1.9%

Gross margin as % of net sales

33.0%

33.2%

33.3%

33.7%

EBITDA

166.3

182.4

(8.8)

331.3

384.6

(13.8)

EBIT

92.1

127.4

(27.7)

202.0

275.9

(26.8)

Adjusted EBIT2)

111.9

129.1

(13.3)

221.3

277.4

(20.2)

Consolidated earnings before taxes

80.7

119.4

(32.4)

174.7

260.6

(32.9)

Consolidated net income3)

62.6

90.4

(30.8)

133.6

197.3

(32.3)

Basic/diluted earnings per share (€)

3.69

5.22

(29.3)

7.83

11.37

(31.1)

Capital expenditure (CAPEX)

40.5

61.9

(34.5)

91.7

114.2

(19.8)

Misc. key figures of the HORNBACH HOLDING AG & Co. KGaA Group

August 31, 2023

February 28, 2023

Change

(in € million, unless otherwise stated)

in %

Total assets

4,473.3

4,725.8

(5.3)

Shareholders' equity

1,973.8

1,897.1

4.0

Shareholders' equity as % of total assets

44.1%

40.1%

Number of employees4)

25,205

25,118

0.3

Rounding up or down may lead to discrepancies between percentages and totals. Calculation of percentage figures based on € 000s.

  1. Like-forlike sales net of currency items; includes sales at all stores that have been open for at least one year and online sales
  2. Adjusted to exclude non-operating income and expenses
  3. Including minority interests pursuant to IFRS
  4. Including passive employment relationships

Key sales and earnings figures stabilize in Q2

  • HORNBACH Group increases consolidated sales by 1.1% to € 1,667.9 million in second quarter (Q2) of 2023/24
    • Net sales at HORNBACH Baumarkt Subgroup: +1.9%
    • Net sales at HORNBACH Baustoff Union Subgroup: -9.4%
  • Due to subdued start to spring season on account of weather conditions, net sales of € 3,441.3 million in first half (H1) of 2023/24 fall slightly short of previous year's figure (-0.6%)
  • Adjusted operating earnings (EBIT) of € 111.9 million in Q2 (-13.3%) and € 221.3 million in H1 (-20.2%)
  • Full-yearguidance for 2023/24 adjusted on September 15, 2023: Net sales at or slightly below previous year's level and reduction of 10% to 25% in adjusted EBIT

HORNBACH HOLDING AG & CO. KGAA GROUP HALF-YEARFINANCIAL REPORT 2023/24

3

Despite ongoing high inflation and increased travel activity, customer demand for construction and home improvement products remained stable in the summer months. Higher customer footfall at stationary stores was countered by slightly lower average spends per customer. Consolidated sales grew by 1.1% in the second quarter (Q2) of 2023/24 (June 1 to August 31, 2023). Notwithstanding the subdued start to the spring season, in the first half (H1) the HORNBACH Group generated sales of

  • 3,441.3 million and thus almost matched the previous year's figure (2022/23: € 3,463.3 million). Sales at HORNBACH Baumarkt AG, the largest operating Subgroup, grew by 1.9% in Q2 and by 1.0% on a like-for-like basis net of currency items. Sales at the HORNBACH Baustoff Union Subgroup contracted by 9.4%, reflecting weak developments in Germany's construction industry.

The HORNBACH Group's operating earnings excluding non-operating earnings items (adjusted EBIT) decreased by 13.3% to

  • 111.9 million in Q2 2023/24 (2022/23: € 129.1 million). At € 221.3 million, adjusted EBIT in H1 2023/24 thus fell 20.2% short of the previous year's figure (2022/23: € 277.4 million). The adjusted EBIT margin amounted to 6.4% in H1 2023/24 (2022/23: 8.0%). Earnings per share stood at € 7.83 and were thus 31.1% lower than in the previous year (2022/23: € 11.37).

To account for the significant deterioration in the economic outlook for Germany and the EU, with prolonged inflation, rising interest rates, and persistently weak consumer sentiment, the guidance for the 2023/24 financial year was adjusted on Sep- tember 15, 2023. For the 2023/24 financial year, net sales are now expected to match or fall slightly short of the previous year's level (previously: at around the previous year's level). Adjusted EBIT is expected to fall -10% to -25% short of the figure of € 290.1 million reported for the 2022/23 financial year (previously: -5% to -15%).

Macroeconomic and Sector-Specific Framework

The macroeconomic climate in the first half of our 2023/24 financial year (March 1 to August 31, 2023) was shaped by inflation rates which, despite beginning to fall, remained high. The annual inflation rate in the euro area (HICP) stood at 5.2% in August 2023 (March: 6.9%), while inflation in the EU 27 countries amounted to 5.9% (March 2023: 8.3%). In Germany, the inflation rate (CPI) amounted to 6.1% in August (March: 7.4%). In most European countries, wage and salary growth has fallen short of inflation, leading to reduced purchasing power among private households. Due to payments of the inflation compensation premium and the raising of the minimum wage in the previous year, Germany witnessed slight real-term pay growth of 0.1% in the second quarter of the calendar year.

According to Eurostat, gross domestic product in the European Union (EU 27) grew year-on-year by 1.2% in Q1 of the 2023 calendar year and matched the previous year's level in Q2 2023. In Germany, GDP showed slight growth of 0.1% in Q1, but fell by

0.6% in Q2 2023. Price-adjusted private consumer spending in Germany decreased year-on-year by 1.2% in Q2 2023 (Q1 2023: +0.2%).

Output in the construction industry in the EU 27 rose year-on-year by 0.4% in Q1 2023 and fell by 0.2% in Q2. In Germany, output contracted year-on-year by 2.0% in Q1 2023 and showed a further reduction of 0.9% in Q2 2023. Residential building permits in Germany fell by 27.2% in the first half of 2023. The increased cost of construction and increasingly poor financing terms are still viewed as the main factors driving the reduction in the number of construction projects.

According to Eurostat, retail sales (excluding motor vehicle retail; in real terms) adjusted for calendar-related factors in the EU 27 fell by 2.5% in Q1 2023. In Q2 2023, the retail sector reported a further contraction of 2.2%. Internet and mail order sales in the EU 27 fell by 6.1% in Q1 2023 and by 2.5% in Q2 2023. Sales in the German retail sector showed a real-term reduction of 4.5% in the first half of the 2023 calendar year.

4

HORNBACH HOLDING AG & CO. KGAA GROUP HALF-YEARFINANCIAL REPORT 2023/24

GDP growth rates and inflation in countries in which HORNBACH operates

Source: Eurostat (calendar year figures)

Germany

Austria

Czech Republic

Luxembourg

Netherlands

Romania

Slovakia

Sweden

Switzerland

Euro area (EA 20)

EU 27

GDP change (%) on previous year's quarter

Q1 2023

Q2 2023

0.1(0.6)

1.9(1.1)

(0.1)

(1.0)

(0.4)

nn

1.9(0.3)

2.4

1.1

1.0

1.5

1.5(1.4)

1.5

0.5

1.4

0.1

1.2

0.0

Rate of inflation (%) based on HICP

March 2023

August 2023

7.8

6.4

9.2

7.5

16.510.1

2.9

3.5

4.5

3.4

12.2

9.3

14.8

9.6

8.1

4.5

2.7

1.9

6.9

5.2

8.3

5.9

Based on figures released by the GfK, German DIY stores and garden centers reported a nominal year-on-year reduction in aggregate gross sales of 2.3% to € 11.25 billion in the first half of the 2023 calendar year. On a like-for-like basis, i.e. excluding stores newly opened, closed, or subject to major conversion measures, sales in the sector also fell by 2.3% in the period from January to June 2023.

According to the GfK, gross sales at DIY stores and garden centers in the Netherlands grew by 7.9% in the first half of the 2023 calendar year. In Austria, sales at DIY stores and garden centers showed a slight decline of 1.4%, while the Czech Republic and Switzerland reported reductions of 3.7% and 4.2% respectively. No data is available for Luxembourg, Romania, Slovakia, or Swe- den.

Sales at DIY stores and garden centers in Germany (calendar year)

Source: GfK Total Store Report Deutschland

Gross sales (€ billion)

Nominal year-on-year change (%)

Like-for-likeyear-on-year change (%)

1st Quarter

2022

4.91

+42.4

+41.0

2nd Quarter

2022

6.60

+0.4

(0.2)

1st Half

2022

11.52

+14.9

+14.3

1st Quarter

2023

4.56

(7.2)

(7.0)

2nd Quarter

2023

6.69

1.4

1.2

1st Half

2023

11.25

(2.3)

(2.3)

HORNBACH HOLDING AG & CO. KGAA GROUP HALF-YEARFINANCIAL REPORT 2023/24

5

Earnings, Financial, and Asset Position

Impact of Macroeconomic Conditions

Faced with ongoing high inflation, rising borrowing costs, and the subdued economic climate, DIY customers were more reluctant to make purchases, particularly of higher-priced product ranges, in the first half of the financial year. House construction plans were postponed, while the renovation of existing living space remained a key priority. Customer footfall at HORNBACH's stationary stores increased compared with the previous year's period, while average spends decreased slightly. Consistent with developments in online retail as a whole, HORNBACH's online shops witnessed a reduction in order figures. These nevertheless remained significantly higher than prior to the pandemic.

Seasonal and Calendar-Related Factors

Impact of weather conditions

In the first quarter, the start to the spring season in the countries in which the HORNBACH Group operates was severely impeded by unusually cold and rainy weather in March and April. This had a significant negative impact on demand for garden products in particular in these months. From May, sunny weather then influenced sales positively, especially in the garden division. The summer months of 2023 were once again warmer and sunnier than average in the countries in which we operate.

Number of business days

There was an average of 0.7 business days fewer in the first half of the 2023/24 financial year (March 1 to August 31, 2023) than in the equivalent period in the previous year. The arithmetic calendar-related impact at the Group came to minus 1.5 business days in Q1 and plus 0.8 business days in Q2.

Sales Performance of the HORNBACH Group

The HORNBACH Holding AG & Co. KGaA Group (HORNBACH Group) comprises the HORNBACH Baumarkt AG, HORNBACH Baustoff Union GmbH, and HORNBACH Immobilien AG Subgroups.

In the second quarter of the 2023/24 financial year (June 1 to August 31, 2023), net sales at the HORNBACH Group grew by 1.1% to € 1,667.9 million (2022/23: € 1,649.9 million). At € 3,441.3 million, sales for the first six months were 0.6%, and thus slightly, lower than the previous year's figure (2022/23: € 3,463.3 million).

HORNBACH Baumarkt AG Subgroup

Development in HORNBACH's store network

The HORNBACH Baumarkt AG Subgroup opened one new DIY store with a garden center in Nijmegen (Netherlands) in the first half of 2023/24. As of August 31, 2023, the Subgroup operated 172 retail outlets (February 28, 2023: 171) with total sales areas of 2.1 million m². Of these, 99 stores are in Germany and 73 in Other European Countries.

Sales performance in 2nd quarter of 2023/24

Net sales at the HORNBACH Baumarkt AG Subgroup rose by 1.9% to € 1,560.4 million in the period from June 1 to August 31, 2023 (2022/23: € 1,531.5 million). Net sales in Germany grew by 0.9% to € 755.0 million (2022/23: € 748.5 million). In the Other European Countries region, quarterly net sales rose year-on-year by 2.9% to € 805.4 million (2022/23: € 783.0 million).

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Hornbach-Baumarkt AG published this content on 27 September 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 September 2023 05:15:11 UTC.