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Accell Group reports growth in third quarter revenue

Published November 17, 2015
Sales of higher priced e-bikes in Europe continue to drive revenue and profits.

HEERENVEEN, Netherlands (BRAIN) — Accell Group reported growth in revenue in the third quarter, which the Dutch conglomerate attributed to healthy sales of the company's German and French bike brands.

Accell owns several European brands including Batavus, Sparta, Koga, Loekie, Ghost, Haibike, Winora, Lapierre, Tunturi, Atala and XLC. It also owns a U.S. subsidiary, Accell North America, which sells Raleigh, Diamondback, Lapierre, Ghost, Redline and XLC to Canadian and U.S. retailers, and SBS, which distributes parts and accessories to U.S. dealers.

Accell Group said it posted growth in revenue in virtually all the countries in which it does business compared to the third quarter of last year. And it expects organic revenue growth and an increase in net profit for the second half of 2015, compared to the same period of 2014.

"The positive trends seen in the first half continued into the third quarter and the month of October," said René Takens, CEO of Accell Group. "Our turnover and profits were up, due in part to the growing proportion of electric bikes and higher-end sports bikes in our sales. The market for electric bikes is dynamic in many European countries and we are seeing our sales increase in those markets. In the Alpine countries in particular, we are seeing strong growth in the sales of performance e-mountain bikes."

For the third quarter, Accell Group posted higher sales in both bicycles and parts and accessories than in the same period of 2014. Sales of electric bikes increased in all European countries, the company said.

The company noted that the new positioning of the Raleigh brand in the U.S. has so far "only had a modest impact on turnover, but the initial response has been positive." And in the U.S., the e-bike market is growing but remains modest, Accell said.

Growth in parts and accessories revenues was largely driven by Germany and the Netherlands, Accell Group said.

In recent months, Accell Group had a good product mix with higher levels of added value than in the same period of 2014. Operating costs as a percentage of turnover fell in recent months.

The U.S. dollar exchange rate had an impact on working capital due to the conversion of inventories and receivables in countries that use the dollar and also partly due to an increase in the cost of components purchased in dollars.

The acquisitions of Comet (Spain) and CSN (Denmark), completed earlier this year, also contributed to an increase in working capital.

Accell also said that the number of more expensive bicycles currently in its inventory is higher than it was in the same period last year.

Accell noted that because of the seasonal nature of the bike market it expects profits in the second half to be considerably lower than in the first half. But the company said its outlook for the medium to long term is positive.

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