Performance by Geographic Area
Europe: business holds despite the impact of The Netherlands and is showing the first signs of a cyclical recovery.
The difficulties encountered relating to the changes in insurance reimbursement in The Netherlands weighed heavily on revenue in Europe which amounted to Euro 559.6 million, down 4% against the previous year. Net of the Dutch figure, revenue in Europe would have been substantially in line with last year (+0.5% at constant exchange rates), further confirmation of the resilient nature of Amplifon’s business. More in detail, fourth quarter revenue in Europe, while still influenced by the persistently negative trend in The Netherlands (-34.2%) and UK (-11.4% in local currency), recovered noticeably in France (+5.7%), the Iberian Peninsula (+9.1%) and Switzerland (+13.6% in local currency). The performance in Germany (-6.2%) was largely influenced by the new regulations which provide for higher refunds effective November 1st, 2013 and which caused customers to delay their purchases in order to take advantage of the improved conditions. Toward this end it is important to underline that volumes were extremely low in the first part of the quarter, but then began to show significant growth which is still underway and which, in December, resulted in sales rising double digit with respect to the same month of the prior year. Revenue in Italy was basically unchanged in the quarter (-0.3%) compared to the strong growth posted in the same period of 2012. Growth continues at a solid pace in Belgium-Luxembourg (+12.8%), Hungary (+84.1% in local currency) and Turkey (+86.2% at constant exchange rates). In 2013 EBITDA in Europe amounted to Euro 57.9 million. The figure reflects the decrease in the contribution from The Netherlands of Euro 13.3 million and restructuring costs of Euro 4.1 million. Net of these items, EBITDA reached Euro 75.2 million, a drop of 10.4% against the previous year.
North America: sales and profitability continue to rise, outperforming the market.
Growth in the United States and Canada continued throughout 2013, particularly in the business units Miracle-Ear and Elite Hearing Network: sales rose in local currency by 9.9% reaching, at year-end, USD 184.2 million. The exchange effect had an unfavorable impact of 3.6%. EBITDA – before non-recurring costs of USD 1.9 million linked to the restructuring of Sonus Medical Franchising – rose 13.3% at constant exchange rate against 2012 to USD 35.9 million.
Asia-Pacific: market share increasing, the expected acceleration confirmed in the second half of the year.
The growth expectations for Asia-Pacific were confirmed also in the last quarter of the year (+17.8% against the same period of 2012), with total revenue rising 8.7% against the prior year to AUD 176.3 million in 2013. EBITDA reached AUD 46.1 million, dropping slightly as a percentage of revenue due to the restructuring costs incurred in New Zealand and the start-up costs in India, while the increased investments made in marketing in Australia, began to generate positive results as demonstrated by the strong growth posted in the second half of the year (+15.1% at constant exchange rate). Recurring EBITDA, net of India’s results, as a margin of sales reached 28% (-0.8%) in 2013 and 32.2% (+6.7%) in the fourth quarter alone.
Africa: presence still limited, but with great potential for development.
Despite a complex socio-political environment, even in Egypt Amplifon was able to post continuous growth in sales which rose 14.8% in local currency to Euro 2.4 million, further confirmation of the region’s great potential for further development.
EBITDA in 2013 reached Euro 117.4 million, a drop of 19.1% with respect to the same period of the prior year. The result was impacted significantly by the problems encountered in the Dutch market (which contributed Euro 13.3 million less than in the prior year), the unfavorable exchange effect of Euro 3.8 million and non-recurring restructuring costs of Euro 5.8 million. Net of these costs, EBITDA reached Euro 140.3 million, a decrease of 3.3% against the previous year.