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Profits up at Nuance Group in 2008
27
Mar '09
The Nuance Group released its financial results for 2008, highlighting the impact of the global economic crisis on the travel retail sector. Despite a strong growth in sales in the first half of the year, a deteriorating second half which saw major currency fluctuations and weakening passenger traffic and consumer spending, resulted in an overall sales decline by 2.6 per cent (+6.2 per cent on a currency adjusted, like-for-like basis). Nevertheless, Nuance was able to increase Operating Profit (EBIT) by 14.5 per cent. The outlook for 2009 however looks ominous.

Overall, Nuance recorded consolidated sales in 2008 of CHF 1,718 million, a 2.6 per cent decrease on the previous year. Currency fluctuations impacted significantly on reported sales as in-country sales, on a like-for-like basis, actually grew by 6.2 per cent.

The overall sales situation masked significant regional variances in sales performance. Singapore grew by 7.5 per cent and both Australia and North America posted solid growth, driven by both operational improvements and currency factors. Softer market conditions were experienced in other regions, although in Europe, recent business development wins helped to offset some of the softness. Switzerland continued to be one of the mainstays of European operations.

EBITDA grew by 8.8 per cent, while Operating Profit (EBIT) grew by 14.5 per cent to CHF 49.9m.

Roberto Graziani, President & CEO of The Nuance Group, commented: “2008 proved to be the year when all of the work and effort we have put into optimising all aspects of our operations, including turning around our Australian operation, achieving significant purchasing efficiencies in Europe, implementing market leading sales training programmes for all of our front line staff and variablising our cost base to the extent possible, started to pay off. Our business now has better flexibility to handle poor economic conditions as well as good ones”.

“However, we now have significant challenges ahead in confronting the current economic environment, confirmed by the sales trend of the first two months of 2009 which has been impacted by a material decline in passenger volumes and a softening of passenger spend. Nevertheless, the work we have done on improving our business in the past few years will stand us in good stead to withstand the current environment better than most.

Nuance believes in the resilience of our industry and that air travel and travel retail will be amongst the first industries to bounce back, as they has always done, once credit and economic conditions stabilise. Consequently, in 2009, Nuance expects to continue to focus on on-going operational excellence and meaningful support discussions with our suppliers and airport partners” Mr Graziani said.

The Nuance Group – Swiss-based The Nuance Group is a global market leader in the travel retail industry, operating 430 shops across 65 airports and 21 countries around the globe and employing 6,000 staff. In addition to its duty- and tax-free operation, the Nuance portfolio comprises specialist shops as well as food & beverage operations, distribution, inflight services and shops in other travel retail channels.

Nuance Group


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