Swedish kitchen giant Nobia saw a slight increase in net sales in the fourth quarter of 2016, but took a hit from lower exchange rates.
The company, which owns brands including Magnet, Gower and Rixonway Kitchens, saw Q4 net sales increase by 5% to SKr3.15 billion (£286.3 million), compared with the SKr3bn in the same period the year before. These were boosted by gains in the Nordic market.
Nobia’s operating profit improved from SKr283m in 2015 to SKr297m in Q4 2016. This was helped by higher sales values, increased volumes and lower costs.
However, exchange rates worked against them, with losses of SKr114m for the quarter, compared with gains of SKr85m in Q4 2015.
Commodore and CIE, which were consolidated on November 1, 2015, reached sales of SKr199m, compared with SKr68m in 2015.
Gross margin was also affected by currency losses, falling from 39.5% in Q4 2015 to 37.5% in 2016.
The company reported a loss of SKr502m as a result of discontinued operations, of which SKr448m was related to the impairment of Poggenpohl, which was sold to Adcuram in December 2016 for a sum of £8.4m.
Nobia president and chief executive Morten Falkenberg said: “Organic growth remained positive in the fourth quarter, primarily driven by increased sales to the Nordic project market. I am also pleased with the sales growth and profitability that we achieved in the tough UK market. The price for Poggenpohl was below our expectations, but the divestment of Poggenpohl entails an improved operating margin for Nobia. For the full-year 2016, an operating margin of 10.3 per cent was reached, despite significant negative currency effects. Thus, the operating margin target is achieved. Going forward, we will continue to focus on profitable growth, both organically and through acquisitions.”
Meanwhile, Nobia has underlined the importance of the UK – which accounts for almost half of its net sales – and has proposed the appointment of two new board directors with extensive experience of that market. They are George Adams and Jill Little.
Adams has more than 20 years’ experience in the European home improvement industry, and was previously president of the European DIY Retailers Association (EDRA).
He also held senior positions at Kingfisher. He is currently a director at furniture and flooring retailer ScS and chairman of online power tools and fixings retailer FFX Tools.
Little has held senior positions at John Lewis Partnership, serving as strategy and international director and business development director.
For the past five years, she has been working for one of the UK’s largest retail groups, El Corte Ingles. She is currently a non-executive director for UK-based premium lifestyle retail company Joules.