Tarkett NA Reports Double-Digit Revenue Growth Due to Lexmark Acquisition
Paris, FR, July 24, 2019--Tarkett's North American segment reported net revenues up 13.4% in H1 2019, as Lexmark acquisition and a positive foreign exchange effect fully covered the 3.4% revenue decline on a like-for-like basis.
Tarkett Group reports organic growth is up 1.3% in H1 2019 and roughly stable in Q2 2019, driven by double digit growth in Sports (+13.3%) and EMEA (+2.1%).
Net revenues at €1,412 million in H1 2019 (versus +7.2% in H1 2018), driven by moderate organic growth, a positive scope effect and a positive forex impact (U.S. dollar driven).
Organic growth remained negative over the course of the semester and was down 5.6% on a like-for-like basis in Q2 2019. This decline reflected a negative mix effect and lower volumes, which were partially offset by higher selling prices. Q2 confirmed that selling price increases are holding up well. The residential activity remained under pressure amid a softer US housing market. Accessories continued to grow in Q2, following a solid performance in Q1. In commercial carpet, volumes remained soft in Q2 2019 not withstanding first signs of improvement in the first quarter, as several projects were delayed due to wet weather conditions. At NeoCon the largest design show in the U.S., Tarkett won two awards, out of which one for creative modular LVT solutions, ID Mixonomi, which was initially developed for EMEA.
Commenting on these results, Fabrice Barthélemy, CEO, said, “After a strong first quarter, we recorded a mixed performance in the second quarter. This did not come as a surprise as we had a less favorable comparison basis and confirms that we are facing tougher market conditions than in 2018. The environment is clearly not going to provide any tailwind: we will durably improve our profitability thanks to our strategy announced in June. 2019 is a transitional year as we start to implement the first initiatives of our new strategy announced in June. We are reducing our cost base, simplifying our processes and focusing our organization on the needs of our customers. We reduced our debt notwithstanding the seasonality of the first half and also improved our financial structure. I am pleased to see that our teams are fully committed on the strategic priorities of our Change to Win plan and I am confident in our capacity to improve our profitability while building sustainable growth. ”