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De’Longhi reports more than 300% rise in net profit for first half of 2021

De'longhi

De’Longhi has announced its financial results from the first six months of 2021, reporting that in its product segment, the coffee sector — particularly for fully automatic machines — had expanded the most out of all its main categories, and showed a growth rate above the group average across both quarters.

The company reported net revenues of US$893 million for the second quarter of 2021, up 49.6 per cent compared to the year prior. This brought De’Longhi’s net revenue in the first six months of 2021 to US $1698.5 million, up a total of 59.7 per cent.

“The extraordinary results achieved in these first six months witness the solidity of the medium-term trends of our core segments and the resilience and flexibility shown by our Group and in particular by our people,” says Massimo Garavaglia, CEO of De’Longhi.

In the second quarter of 2021, at constant exchange rates De’Longhi’s revenue grew 54.3 per cent, while its adjusted Ebitda of US $145.5 million was up by 76.2 per cent and equal to 16.3 per cent of revenues. This marked an improvement of 2.5 per centage points on revenues as compared to 2020.

The net profit for the group, as of the second 2021 quarter was US $118.5 million, up 211.1 per cent, equal to 13.3 per cent of revenues.

The second quarter also saw De’Longhi acquire coffee machine manufacturer Eversys on 3 May. This contributed to $142.1 million in revenue.

“[These] Results [were] obtained despite the critical issues that the entire industrial world is facing globally, such as the increase in freight costs and raw materials and the supply flows of some components,” says Garavaglia.

“The De’ Longhi Group responds to these challenges with a renewed commitment to investments in innovation, production facilities and communication and marketing activities in support of our brands and products.”

Overall, for the first six months of 2021, at a constant exchange rate, De’Longhi’s revenues grew by 64.5 per cent. Its adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) was US$298.2 million, up by 124.9 per cent and equal to 17.6 per cent of revenues, increasing by 5.1 percentage points on revenue as compared to 2020.

The net profit for the group, for the first six months of 2021, was US$214.4 million, up 319.5 per cent, equal to 12.6 per cent of revenues.

As of 30 June, De’Longhi’s net financial position was positive for US$258.5 million and for the first six months of the year, its cash flow —before dividends and acquisitions — was positive by US$232.7 million.

According to the report, the first half of 2021 saw De’Longhi consolidate and strengthen its leadership position in the Small Domestic Appliances market at a global level. Growth was achieved across both quarters through continuous investment in “innovation, manufacturing excellence, communication, and marketing”.

“Furthermore, in the last three years, the decision to expand the budget for communication and marketing activities has been fundamental in order to seize all the opportunities that the market offers,” says Garavaglia.

These opportunities include growing consumption at home and address challenges brought by the pandemic. Increased production efficiencies and a prudent price increase strategy were examples listed of how De’Longhi mitigated rising industrial costs.

“In particular, in line with this strategy and the medium-long term plan, the second half of this year will see the Group launching an important global communication campaign in the coffee segment, which we believe will allow us to further consolidate and increase our global leadership in the sector,” Garavaglia says.

Based on location, South-West Europe showed a growth of 52 per cent (at constant exchange rates) since the beginning of 2021 while North-East Europe recorded double-digit growth, at a 53 per cent constant exchange rate, since the start of 2021.

The America region showed a 50 per cent growth rate in the first six months while the Middle East, India and Africa region ended the first half of the year with 142 per cent growth, at constant exchange rates.

The Asia Pacific region also maintained a double-digit growth, increasing by 14 per cent, at constant exchange rates. China grew by 17 per cent, at a constant exchange rate.

“The experience gained in recent quarters has once again demonstrated the extraordinary dedication of the teams and the flexibility of the business organisation, thus giving an important signal for a positive development of the business in the near future,” De’Longhi says.

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