'Nouvelle Confiance' is the name Darty's (DRTY) management has given a strategic plan to overhaul the ailing business, focusing on what new chief executive Régis Schultz calls the "four-Ds": driving trading, digitalising Darty, developing the brand and delivering cost efficiency. Annual savings of €50m are being targeted by 2015-16.
Having disposed of Darty Italy, closed Darty Spain and seen Comet fall into administration, the electrical retailing group is looking at "options" for the Czech Republic and Slovakia, and is "reviewing" the Turkish business to focus on its core markets: France, Belgium and Holland. This restructuring has come at a price, though - the group incurred €115m (£98m) of exceptional charges in the year. Strip out those costs and underlying pre-tax profit still tumbled 66 per cent to €26.4m, driven by margin pressure from product mix, deteriorating trading conditions and fierce competition. Same-store sales fell 1.1 per cent.
In France, where Darty is pinning its hopes on future profitability, a 4 per cent decline in sales to €2.7bn combined with gross margin erosion caused retail profit to fall 30 per cent to €74.3m. Revenues increased in Belgium and Netherlands, but weaker margins and higher costs meant retail profit plunged 61 per cent to €7.5m. Turkey, Slovakia, the Czech Republic and Spain all reported weak sales and deepening losses.
UBS expects pre-tax profits of €40m this year, rising to €54m in 2014-15.
| DARTY (DRTY) | ||||
|---|---|---|---|---|
| ORD PRICE: | 63p | MARKET VALUE: | £334m | |
| TOUCH: | 62-63p | 12-MONTH HIGH: | 80p | LOW: 36p |
| DIVIDEND YIELD: | 4.7% | PE RATIO: | na | |
| NET ASSET VALUE: | * | NET DEBT: | €150.6m | |
| Year to 30 Apr | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2009** | 5.86 | -107.6 | -27.5 | 5.90 |
| 2010 | 5.79 | 77.8 | 8.8 | 6.60 |
| 2011 | 4.11 | 85.6 | 9.9 | 7.00 |
| 2012 | 3.89 | 38.6 | 3.4 | 3.50 |
| 2013 | 3.80 | -72.5 | -13.8 | 3.50 |
| % change | -2 | - | - | - |
Ex-div: 11 Sep Payment: 4 Oct *Negative shareholders' funds **Pro-forma figures, reflecting change in reporting currency to euros. £1=€1.17 | ||||
