Back-to-school (BTS) trading and new products helped to lift BIC sales in an otherwise tough Q3 for the manufacturer.
In the manufacturer’s stationery division, quarterly sales rose 2.6% on a comparative basis to €191.3 million ($226 million).
Overall, BIC’s Q3 was below expectations with sales down 5% at €465.8 million while profit fell 21.5% to €57.8 million. The group said it would be cutting its full year forecasts of slightly less that 2% sales growth.
For the nine months ended 30 September, sales rose 2.9% to €619.4 million.
Sales in Europe recorded mid-single digit growth. It reported a good BTS period across all European countries, which managed to offset market softness.
The stationery segment gained market share across the board, most notably in France for the 14th consecutive year, and also in the UK.
The group attributed this to improved customer relationships, targeted brand support investment and the success of new products.
In North America, sales grew low-single digit in a slightly declining market. During the BTS period, it remained flat, but new product launches allowed BIC to gain share.
In developing markets, Latin America sales grew low-single digits. In Brazil, it continued to gain market share despite a weak environment. Good BTS trading in Mexico allowed BIC to outperform the market there.
In the Middle-East and Africa, it delivered robust growth alongside market share gains, particularly in South Africa.
Adjusted operating profit margins for the segment were reported at 8.9%, compared to 9.9% for the period last year. Q3 margins were also slightly lower at 3.6% compared to 4% last year. This was due to increased brand support investment.
BIC also announced that it is to invest around €28 million in a new writing instruments facility in India. Its subsidiary Cello has acquired land and building for the construction of a new writing instrument facility in Vapi, Gujarat.
The investment will enhance its manufacturing reach in India, and enable it to meet consumer demand more effectively in this rapidly growing market. The facility is expected to be operational by the end of 2018.
By Joshua Allsopp for OPI
French company Bic, known for its disposable lighters, ball-point pens and razor blades, has seen its sales stagnate over the past six months. The board has immediately lowered its full-year growth forecast.
1.063 billion euro turnover
Bic achieved a 1.063 billion euro six-month turnover (+ 0.3 % compared last year’s first semester), thanks to the Stationary division that grew 3.3 % and is the company’s largest division with a 428-million euro turnover. Distributors responded well to Bic’s novelties for the upcoming schoolyear, the Clichy-based company said.
Bic’s disposable lighters also continue to sell well and contribute 356.9 million euro, up 0.8 %. Its razor blade division did not do as well, as its turnover slumped 4.3 % to 236.4 million euro, mainly because of weaker sales in the United States. By comparison, Europe and the growth markets did display growth for the razor blade division.
Even though its second quarter turnover outperformed the first quarter, the board still dialed back its full-year growth forecast. “As markets remain volatile for the balance of the year, coupled with recent signs of lower consumption in Brazil, we now expect to trend between 3% to 4% Full Year Organic Net Sales growth”, Bic said. Only three months ago, it targeted a 5 % increase, but analysts had already stated that number was far too optimistic. The French group published a 2.026 billion euro turnover and a 249.7 million euro net profit.
By Karin Bosteels for www.retaildetail.eu
French writing instruments vendor, BIC, has reported strong Q4 growth. According to the company, stationery sales increased by 7.8% to €165.6-million.
Sales were high in emerging markets such as South Africa and Brazil, owing to the back-to-school season, while in India sales also improved. The company reported mid-single digit growth in Europe and high-single digit growth in North America.
Overall, FY2016 sales for the Stationery division increased by 5.2% in constant currency to €736.6 million. Stationery volumes increased 1.5% to 6.9 billion units in 2016.
Looking ahead into 2017, the firm outlined priorities to deliver organic sales growth and gain market shares in the division through new product launches, increased R&D investment and new emerging channels such as e-commerce in developed countries.
Meanwhile in its Graphic arm, Q4 sales fell 13.6% to €94.6 million. Full-year sales also dropped, registering a 1.9% fall to €311.5 million.
BIC’s overall full-year sales rose 4.9% to €2.03 billion, while pre-tax profit dropped 10.7% to €408.1 million.
Earlier this month, BIC revealed that a strategic review of its promotional products unit would hit group FY2016 profits. The company has now revealed a €48.4 million hit from these operations.
Bruno Bich, chairman and CEO, says: “Our solid 2016 results are further testimony to the quality and strength of our business model. In a fast-moving and challenging market environment, such as in Shavers in the US, net sales growth was robust and consistent across all consumer categories. Despite the planned increase in operational investment, normalised income from operations remained healthy.
“In 2017, the volatility of currencies and the unpredictable global environment will require increased levels of agility from our teams to ensure continued success. We plan to deliver mid-single digit organic growth in Net Sales. We will continue to launch new products and strengthen our distribution, with a focus on e-commerce in developed markets.
“To enhance long-term growth, we plan another year of selected investments in R&D, CAPEX and Brand Support. The total impact of these investments on Normalized Income From Operations margin will be approximately -100 basis points compared to 2016, excluding major currency fluctuations.”
BIC has reported that its stationery net sales for the first nine months of 2016 decreased by 0,6% but grew by 4,6% on a constant currency basis.
In Europe, the increase in nine-month net sales was in the high single-digits. The back-to-school sell-out was good, especially in France (where BIC gained market share for the 12th year in a row) and in the UK.
In North America, BIC registered low-single digit growth in the nine-month period. Market growth during back-to-school was in the mid-single digits (in value terms) with gains market share thanks notably to the performance of its top selling products.
Sales growth was in the low-single digIts in Latin America, with gains in market share in Brazil. In the Middle-East and Africa, BIC delivered very strong growth along with market share gains in South Africa and a good performance in Morocco.
For the fifth consecutive year, BIC is visiting schools across Gauteng on its educational roadshow. This year, the stationery brand continues its efforts towards improving the quality of education in our schools with the message: ‘If You Can Dream It, You Can Be It’. The aim is to motivate pupils to strive for greatness regardless of their circumstances.
The activation, presented by the brand character ‘BIC Boy’ and a team of brand activators from Zinto Marketing Group who have partnered with BIC since the outset of these national educational roadshows, imparts key educational messages ‒ emphasising the importance of making good career choices and planning for the future from a young age. The format engages learners to interact with the brand which encourages pupils to strive towards creating and leaving their own legacy.
BIC has also launched a colouring-in competition being run concurrently with the roadshow, which inspires learners to get creative. It brings excitement to schools and awards cash prizes to the winners as well as the teachers and schools with the most entries.
The winning school will select an under-resourced school of their choosing as the recipient of a cash donation. In addition, BIC will refurbish one other school in need of maintenance and repair.
Launched in 2011, the ‘Buy a pen. Donate a pen’ initiative has donated over five million pens that assist under-privileged learners across South Africa by contributing a pen for every one purchased. The aim to ensure that our future learners are able to change opinions through education with the notion: ‘The Pen is Mightier than the Sword’.
Bic has announced that its full year 2015 stationery net sales increased 7,4% as reported and were up 3,6% on a comparative basis. Full-year 2015 volumes grew 2%.
Bic reports that its 2015 results were good thanks to the success of its “champion brand” strategy fueled by successful new product introductions, continued investments in brand support, and sustained investments in geographic expansion.
The Europe region recorded net sales up high-single digit, sustained by good results during back-to-school and market share gains in most countries. This performance reflected the success of core segments such as ball pens, colouring and correction and the “champion brand” strategy.
The North America zone generated net sales up low-single digit, reflecting the good execution of its strategy and the success of new products (such as the BIC Atlantis range and BIC X-tra fun graphite pencils).
This performance was supported by the positive impact of its “Fight for your write” campaign.
Developing markets saw net sales increase low-single digit with most of the regions delivering strong performances.
BIC is to sponsor the 2016 National Stationery Week, along with Sheaffer, Maped Helix, Nu Notebooks and Staedtler.
BIC has reported that its stationery division grew comparable sales by 6,1% in the third quarter.
Launched in 2011, the “Choose BIC and change a future” initiative has donated over five-million pens to assist underprivileged learners across South Africa.