Hornbach Baumarket Q1 Profit, Sales Fall; Backs Annual Adj. EBIT, Sales View

June 23, 2023

Hornbach Baumarket AG (HBAPF.PK), a German operator of DIY stores and home improvement centers, on Friday posted a decline in earnings and sales for the first quarter, amidst strong headwinds due to adverse weather at the start of the key DIY and gardening season.

In addition, the company has reaffirmed its fiscal 2024 adjusted EBIT and sales guidance.

For the three-month period, the home improvement company posted a net income of 71 million euros or 4.15 euros per share, 33.6 percent lesser than 106.9 million euros or 6.14 euros per share, registered for the same period of previous year.

The earnings were impacted mainly by a subdued start into the season. In addition, inflationary pressures continued to affect gross margin and operating costs, especially with regard to rising wages as well as one-off inflation support payments.

Pre-tax profit was at 94.1 million euros as against last year’s 141.2 million euros.

EBIT stood at 110 million euros, down 26 percent from 148.6 million euros a year ago.

Excluding items, EBIT moved down to 109.4 million euros from 148.3 million euros of previous year.

As expected earlier, sales for the quarter declined slightly to 1.773 billion euros from 1.813 billion euros last year.

Looking ahead, Albrecht Hornbach, CEO of Hornbach, said: “As we expected, earnings have slightly declined in Q1 2023/24 largely due to the subdued start into the spring season. However, we saw a strong acceleration in business activities in May and also in June. Thus, we remain confident that we can deliver against full year guidance as sales have picked up since and EBIT has stabilized in May…”

For the full year, the Group still expects to record sales at about previous year’s level of 6.263 billion euros.

Due to the slower start to the spring season and the broader macroeconomic challenges, the company continues to expect adjusted EBIT to be around 5 percent to 15 percent below the level of previous year’s 290.1 million euros.

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