Q3 2022 revenue: Turnover growth driven by solid performance in
Sports and sales price increases
Q3 2022 revenue:
Turnover growth driven by solid
performance in Sports and sales
price increases
Volume stable compared to Q3 2021
despite a slowdown in demand in some segments
Third quarter 2022 results
- Strong
revenue growth of +24.2% compared to Q3 2021, of which +11.9% from
sales price increases, +12.2%
from currency effects and stable volume as growth
in Sports offsets slowdown in EMEA and CIS
-
In EMEA, business volume down compared to Q3 2021 due to
slowing demand and destocking in the distribution
chain
-
Moderate volume growth in North America in a less dynamic
market than in the first half
-
Stabilised levels of activity in the CIS
at approximatively -25% and continued
growth in Asia and Latin America
-
Very good level of activity in Sport, with organic growth
of over 30% for the third consecutive quarter
- Rising
sales prices and positive inflation balance despite
increase in energy prices
Paris, 25 October 2022: The
Supervisory Board of Tarkett (Euronext Paris: FR0004188670 TKTT),
which met today, reviewed the Group’s consolidated revenue for the
third quarter of 2022.
The Group uses alternative performance
indicators (not defined under IFRS), described in detail in the
appendix:
Revenue in millions of euros
|
Q3 2022
|
Q3 2021
|
Change
|
Of which organic growth
|
Organic change including price changes in CIS
(1)
|
EMEA
|
220.4
|
217.4
|
+1.4%
|
+2.7%
|
+2.7%
|
North America
|
251.4
|
194.1
|
+29.5%
|
+11.5%
|
+11.5%
|
CIS, APAC & Latin America
|
191.1
|
164.1
|
+16.5%
|
-13.8%
|
-1.5%
|
Sports
|
342.5
|
233.9
|
+46.4%
|
+30.5%
|
+30.5%
|
Total Group
|
1,005.4
|
809.4
|
+24.2%
|
+9.7%
|
+12.0%
|
(1) Selling price adjustments
in the CIS countries are historically intended to offset currency
movements and are therefore excluded from the “organic growth”
indicator (see Appendix 1). In 2021 and 2022, significant price
increases have been implemented to offset the effects of purchase
price inflation, and therefore the Group also measures the change
in like-for-like sales including price adjustments in the CIS
countries.
1. Third quarter 2022
turnover
Net revenue for the Group was
1,005 million euros, up by +24.2% compared to the third quarter of
2021. Organic growth was +12.0% including the sales price increases
in the CIS region implemented at the beginning of the year(1). The
total effect of the sales price increases implemented across all
segments is +11.9% on average compared to the third quarter of
2021.
The EMEA segment achieved a
turnover of 220 million euros, up +1.4% compared to the third
quarter of 2021, including an unfavourable currency effect of -1.3%
and +2.7% of organic growth. In an uncertain economic environment,
the Group has seen a contraction in demand, amplified by inventory
reductions across the value chain. Residential activity is
significantly lower than in 2021, which was marked by a clear
recovery. Commercial activity was also down in most categories with
the exception of LVT tiles. However, sales price increases
compensated for inflation in raw materials, transport and
energy.
The North America segment
reported a revenue of 251 million euros, up +29.5% compared to the
third quarter of 2021, reflecting solid like-for-like growth of
+11.5% and a positive currency effect due to the appreciation of
the dollar against the euro (+18.0%). Sales volumes and prices
contributed to organic growth, which is well oriented in the
Commercial Office, Healthcare and Education segments using carpet,
accessories and vinyl or rubber flooring. The volume of activity in
Residential is down in a market that is clearly slowing down.
Revenue in the CIS, APAC and Latin
America segment amounted to 191 million euros, up +16.5%
compared to the third quarter of 2021, thanks to a positive
currency effect mainly due to the appreciation of the rouble
(+18.0%). The activity is slightly down organically (-1.5%
including sales price increases in the CIS countries). In Russia,
the market was penalised by the geopolitical context and Tarkett's
activity was down by approximately -25% in volume compared to the
previous year. Sales are higher than the previous year due to price
increases and the appreciation of the rouble. At the end of
September, sales in Russia represented approximately 9% of total
Group sales. APAC and Latin America had an excellent quarter with
strong volume growth and continued price increases.
As expected, the Sport
segment continues to show very strong growth for
the third consecutive quarter. Revenue was 343 million euros, up by
+46.4% and including +30.5% organic growth compared to the third
quarter of 2021. The market is extremely dynamic in North America
for both artificial turf and athletic tracks, two segments where
Tarkett benefits from its leadership.
2. Outlook to end 2022 and short-term
objectives
The macroeconomic context poses significant
uncertainties for activity at the end of this year and the
beginning of 2023.
In Europe, geopolitical tensions, inflation and
uncertainty over gas and electricity supplies will continue to
weigh on demand levels in a recessionary environment. The group
expects business volumes in the fourth quarter to be lower than in
the previous year.
In North America, the significant rise in
interest rates initially led to a slowdown in the residential
market, to which the Group has only moderate exposure. Commercial
activity has been better oriented so far, but could stall in a
context of sluggish economic growth.
The war in Ukraine will continue to weigh on the
level of activity in the CIS area, although it is not possible at
this stage to assess whether the market will stabilise at the
current level (around -25% compared to 2021).
The North American sports market is expected to
continue to grow. The Group’s order book remains high and allows us
to anticipate a good start to the year 2023.
The slowdown in volumes in some of the Group's
geographies will not generate all the expected productivity gains.
They are estimated at between 5 to 10 million euros for the whole
of 2022 (compared to the planned 15 to 20 million euros). To take
account of the contraction in activity, the Group is taking
immediate measures to reduce costs, particularly in Europe where
most industrial sites have significantly reduced their production
volumes.
(1) Selling price adjustments in the CIS
countries are historically intended to offset currency movements
and are therefore excluded from the “organic growth” indicator.
Excluding these price increases, organic growth was +9.7% (see
Annexe 1)The purchase prices of the main raw materials are
stabilising due to a slowdown in demand. Nevertheless, the sharp
rise in energy prices will continue to fuel a high price level in
the coming months. The Group confirms the estimate for 2022 of the
negative effect of higher procurement costs: about 280 million
euros more than in 2021.
Since the beginning of the year, Tarkett has
implemented significant sales price increases that will neutralise
the effect of inflation over the whole year.
The Group believes that the measures implemented
will enable to achieve an Adjusted EBITDA level for the full year
2022 higher than that of 2021.
This press release may contain forward-looking
statements. These statements do not constitute forecasts regarding
results or any other performance indicator, but rather trends or
targets. These statements are by their nature subject to risks and
uncertainties as described in the Company’s Registration Document
available on its website (www.tarkett-group.com). They do not
reflect the future performance of the Company, which may differ
significantly. The Company does not undertake to provide updates to
these statements.
Financial calendar
- 15 February
2023: financial results for Q4 and the year 2022 – Press
release after close of trading
Investor Relations and Individual Shareholders
Contact
investors@tarkett.com
Media contactsBrunswick -
tarkett@brunswickgroup.com - Tel.: +33 (0) 1 53 96 83 83Hugues
Boëton – Tel.: +33 (0) 6 79 99 27 15 – Benoit Grange – Tel.: +33
(0) 6 14 45 09 26
About TarkettWith a 140-year
history, Tarkett is a worldwide leader in innovating flooring and
sports surface solutions, with revenue of 2.8 billion euros in
2021. Offering a wide range of products, including vinyl, linoleum,
rubber, carpet, parquet and laminates, artificial grass and
athletic tracks, the Group serves its customers in over 100
countries worldwide. Tarkett has more than 12,000 employees and 34
industrial sites, and sells 1.3 million square metres of flooring
every day for hospitals, schools, housing, hotels, offices or shops
and sports fields. Committed to changing the game with circular
economy and to reducing its carbon footprint, the Group has
implemented an eco-innovation strategy based on Cradle to Cradle®
principles, aligned with its Tarkett Human-Conscious Design®
approach. Tarkett is listed on the Euronext regulated market
(compartment B, ISIN: FR0004188670, ticker: TKTT).
www.tarkett-group.com
***
Appendices1/ Definition
of alternative performance indicators (not defined under
IFRS)
- Organic growth
measures the change in revenue as compared with the same period in
the prior year, outside of the exchange rate effect and changes in
scope. The exchange rate effect is obtained by applying the prior
year’s exchange rate to sales for the current year and calculating
the difference with sales for the current year. It also includes
the effect of price adjustments in the CIS countries intended to
offset the change in local currencies against the euro.
- The effect of changes in
scope is composed of:
- current year sales by entities not
included in the scope of consolidation in the same period of the
prior year, until the anniversary of their consolidation;
- the reduction in sales related to
divested businesses not included in the current year's scope of
consolidation but included in sales for the same period in the
previous year until the anniversary date of the divestiture.
In millions of euros
|
2022 revenue
|
2021 revenue
|
Change
|
Of which volume
|
Of which sales prices
|
Of which CIS sales prices
|
Of which exchange rate effect
|
Of which effect of changes in scope
|
Q1 Group Total
|
684.7
|
558.8
|
+22.5%
|
+6.4%
|
+8.8%
|
+4.1%
|
+3.3%
|
-
|
Of which organic growth
|
+15.2%
|
|
|
|
Of which sales price increases
|
|
+12.9%
|
|
|
|
Q2 Group Total
|
879.3
|
702.4
|
+25.2%
|
+3.3%
|
+9.3%
|
+3.3%
|
+9.3%
|
+0.1%
|
Of which organic growth
|
+12.6%
|
|
|
|
Of which sales price increases
|
|
+12.6%
|
|
|
|
S1 Group Total
|
1,564.0
|
1,261.2
|
+24.0%
|
+4.6%
|
+9.1%
|
+3.6%
|
+6.6%
|
+0.1%
|
Of which organic growth
|
+13.8%
|
|
|
|
Of which sales price increases
|
|
+12.7%
|
|
|
|
Q3 Group Total
|
1,005.4
|
809.4
|
+24.2%
|
+0.1%
|
+9.6%
|
+2.3%
|
+12.2%
|
+0.1%
|
Of which organic growth
|
+9.7%
|
|
|
|
Of which sales price increases
|
|
+11.9%
|
|
|
|
9M Group Total
|
2,569.4
|
2,070.6
|
+24.1%
|
+2.9%
|
+9.2%
|
+3.2%
|
+8.7%
|
+0.1%
|
Of which organic growth
|
+12.2%
|
|
|
|
Of which sales price increases
|
|
+12.4%
|
|
|
Revenue in millions of euros
|
9M 2022
|
9M 2021
|
Change
|
Of which organic growth
|
Organic change including price changes in CIS
(1)
|
EMEA
|
707.4
|
662.6
|
+6.8%
|
+7.7%
|
+7.7%
|
North America
|
702.2
|
546.5
|
+28.5%
|
+14.4%
|
+14.4%
|
CIS, APAC & Latin America
|
482.1
|
418.7
|
+15.1%
|
-11.5%
|
+4.3%
|
Sports
|
677.7
|
442.7
|
+53.1%
|
+38.4%
|
+38.4%
|
Group Total
|
2,569.4
|
2,070.6
|
+24.1%
|
+12.2%
|
+15.3%
|
2/ Bridges in millions of euros 2022
Revenue by segment
Q3 2021
|
809.4
|
+/- EMEA
|
+6.0
|
+/- North America
|
+22.4
|
+/- CIS, APAC & Latin America
|
-22.7
|
+/- Sports
|
+70.0
|
Q3 2022 like-for-like scope and exchange
rate
|
885.1
|
+/- Scope effect
|
+1.4
|
+/- Currencies
|
+74.6
|
+/- Lag effect in CIS
|
+44.3
|
Q3 2022
|
1,005.4
|
9M 2021
|
2,070.6
|
+/- EMEA
|
+49.8
|
+/- North America
|
+78.6
|
+/- CIS, APAC & Latin America
|
-48.0
|
+/- Sports
|
+167.6
|
9M 2022 Like-for-Like
|
2,318.6
|
+/- Scope effect
|
+2.6
|
+/- Currencies
|
+148.9
|
+/- “Lag effect” in CIS
|
+99.3
|
9M 2022
|
2,569.4
|
***
- Press release - Tarkett - Q3 Results 2022
Tarkett (EU:TKTT)
Historical Stock Chart
From Jun 2024 to Jul 2024
Tarkett (EU:TKTT)
Historical Stock Chart
From Jul 2023 to Jul 2024