DGAP-News: VanCamel AG / Key word(s): Final Results VanCamel AG: VanCamel AG publishes the annual report for FY 2013 - Increasing brand awareness ensures profitable growth 30.04.2014 / 18:44 --------------------------------------------------------------------- VanCamel AG publishes the annual report for FY 2013 - Increasing brand awareness ensures profitable growth - Preliminary figures confirmed - Group revenue grew 4.2% to EUR 175.4 million (2012: EUR 168.3 million) - Apparel sales increased as well as shoe sales - Profit margins remain at a high level - Net profit amounted to EUR 33.3 million (2012: EUR 38.8 million) - Dividend proposal of EUR 0.31 per share - Positive outlook for FY 2014 - Sales growth of around 4% at an EBT margin of approx. 21% expected Hamburg, 30 April 2014 - VanCamel AG (Prime Standard, ISIN DE000A1RFMM9, VC8) today published the annual report for FY 2013. Supported by increasing brand awareness, the German holding company of an established Chinese fashion label, was able to post further growth, confirming the previously announced preliminary figures. Sales grew 4.2% to EUR 175.4 million and pre-tax earnings amounted to EUR 49.0 million, corresponding to an EBT-margin of 27.9%. The operating cash flow was almost EUR 35 million and the equity ratio improved to 77.1%. "We are pleased by the positive development not only of the VanCamel brand but also of the VanCamel share, which has almost doubled in value since the listing. There is a growing market for fashion and lifestyle products for our target group: affluent young men. Since VanCamel meets customers' desire for greater individuality and adopted a clear brand strategy and a unique design to differentiate itself from its competitors at an early stage, we are able to benefit from this trend", reports Xiaming Ke, CEO of VanCamel AG. Sales and earnings VanCamel lifted the revenue by 4.2% year-on-year to EUR 175.4 million in FY 2013 (2012: EUR 168.3 million). Both product lines registered growth in revenues. Revenue from apparel rose 3.9% in the reporting period to EUR 122.8 million (2012: EUR 118.2 million) and revenue from shoes rose 5.0% to EUR 52.6 million (2012: EUR 50.1 million). The revenue split between the two product lines was therefore basically stable and remains around 70% apparel and 30% shoes. The company's gross profit was EUR 58.9 million in 2013 (2012: EUR 59.5 million), giving a gross profit margin of 33.6% (2012: 35.4%). The slight decline in the gross profit margin was principally caused by the introduction of rebates for distributors. This changeover meant that revenue did not rise as fast as the cost of sales (EUR 116.5 million compared with EUR 108.8 million in 2012), which held back the gross profit margin. This effect holds true for all earnings indicators: EBITDA was EUR 48.8 million in 2013, compared with EUR 51.0 million in 2012 and the operating result (EBIT) amounted to EUR 48.8 million (2012: EUR 51.0 million). Overall, the 2013 result was EUR 33.3 million (2012: 38.8 million), giving earnings per share of EUR 2.22 (2012: EUR 2.60). Management board of VanCamel AG, with the consent of its supervisory board, decided to present to the Annual General Meeting (AGM) a proposal for a dividend payment of EUR 0.31 per share. This proposal is a result of a dividend payment of the operational units in China with an amount of RMB 48 million (EUR 5.6 million) or an equivalent of roughly 17 % of the consolidated net profit of the group of EUR 33.3 million for financial year 2013. The dividend is due for payment immediately after the AGM in August 2014. The exact date of the AGM will be announced shortly. The equity ratio improved to 77.1% (2012: 72.2%) and at EUR 34.6 million, the operating cash flow remained at a high level (2012: EUR 41.4 million), giving VanCamel the necessary entrepreneurial room for further expansion. For example, VanCamel continued to invest in extending brand awareness in FY 2013. To this end, it increased its marketing spend from 2.3% to 2.5% of revenue. VanCamel aims to continue this trend in 2014. In collaboration with distributors, the aim is to open about 120 new shops in various locations. To accompany this, spending on marketing is to be raised to 2.8% of revenue to raise visibility of the brand among consumers still further. The marketing strategy focuses on opening more flagship stores and advertising aimed at the target group, using billboards, printed media and the internet. In addition, VanCamel is continuing to invest in its in-house design and development team and is currently exploring the possibility of collaboration with fashion and design schools and universities to gain constant access to new talent and ideas in the fashion sector. By contrast, the management has not budgeted any investment into property plant and equipment in 2014. Outlook Assuming that China's domestic market continues to grow, the target group's fashion affinity increases further and the number of authorized retail outlets increases as planned, the company expects volume sales to increase steadily in the coming years. Based on the present order situation, the Management Board assumes that on a euro basis (excluding currency effects), the Group will grow revenue by around 4.0% in 2014. This already takes into consideration that the sales rebates, which increased from 4.5% in FY 2013 to 7.5% in FY 2014, diminish revenue growth by the same amount in each of these two years. This has less impact on the operating result. Together with the plans to step up marketing, at Group level, VanCamel therefore is likely to report slightly lower margins. Accordingly, the Management Board expects the EBT margin to drop slightly to a sustainable level of about 21% in 2014. The audited consolidated financial statements for FY 2013 are available at Investor Relations/Publications on the company's website at www.vancamel.de/en. Notes on comparisons with 2012 figures The following effect should be borne in mind when comparing the revenue and earnings figures for the present year and the prior year: Before the transition to IFRS, VanCamel made shop fittings available to its distributors free of charge, capitalized the associated costs and depreciated the shop fittings over three years. Because of problems with the evidence and the evaluation all shop fittings have been recognised retrospectively in profit and loss in the year of investment. Since 2012, the shop fittings are no longer provided by VanCamel. To continue to support distributors in the ongoing modernization of their stores, VanCamel has introduced sales rebates. The rebate is 7.5% from 2014 with preceding stepwise increases. The rebate was 1.2% in 2012 and increased to 4.5% in 2013. Sales revenue decreases by the same amount as the increase, but the impact on operating income is lower because depreciation is no longer recognized for shop fittings. About VanCamel VanCamel AG is the German holding company of an established Chinese fashion label, which employs more than 200 workers in the design, marketing and distribution of own branded apparel, footwear and accessories. VanCamel products address the young, well-funded urban middle-class, particularly targeting male consumers aged between 25 and 40 primarily residing in tier 2 and tier 3 cities, aspiring after upper middle class fashion styles. The prizewinning design of VanCamel's apparel is made in-house whereas the design of the footwear is outsourced based on the conceptual ideas of VanCamel. The production of both apparel and footwear is completely outsourced to local contract manufacturers. VanCamel is an established national brand with a PRC-wide reach. More than 40 regional distributors supply VanCamel's products to more than 2,200 authorized retail outlets in 26 provinces throughout China. For further information about the company visit: www.vancamel.de/en For enquiries: VanCamel AG Lester Eng Ann Soh Member of the Management Board and CFO E-Mail: [email protected] Tel.: +86 155 5911 7996 Disclaimer: This document is no offer for the purchase of securities in the United States of America. Securities may only be sold or offered for sale with the previous registration under the U.S. Securities Act of 1933 in the actual valid version or without previous registration only pursuant to an exemption. The shares of VanCamel AG (the 'Shares') have not been registered under the U.S. Securities Act of 1933 in the actual valid version and may not be sold or offered in the United States. This document is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) to investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the 'Order') or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as 'relevant persons'). The Shares, which are referred to, are only available to relevant persons and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents. End of Corporate News --------------------------------------------------------------------- 30.04.2014 Dissemination of a Corporate News, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------- Language: English Company: VanCamel AG Ferdinandstraße 25 20095 Hamburg Germany Phone: 040 689999-0 Fax: 040 689999-10 E-mail: [email protected] Internet: www.vancamel.de ISIN: DE000A1RFMM9 WKN: A1RFMM Listed: Regulierter Markt in Frankfurt (Prime Standard) End of News DGAP News-Service --------------------------------------------------------------------- 265951 30.04.2014