In the first nine months of 2010 the ALSO Group increased its net profit over the same period in 2009 by 9% (10% in local currencies) to CHF 16.3 million. At CHF 2966 million, consolidated net sales remained at the same level as last year (+6% in local currencies). Including non-recurring costs related to the planned merger with Actebis and barring unforeseen circumstances, ALSO expects a net profit of CHF 22 to 25 million for 2010 (2009: CHF 15 million).
In contrast with the first half of 2010, demand for IT products fell slightly again in many parts of Europe during the third quarter compared with last year. The tail-off in demand was more marked among private consumers than in the corporate sector. Nevertheless, during the first nine months of the year ALSO managed to generate consolidated net sales of 2966 million, equal to those for last year (+6% in local currencies).
Compared with the same period last year, operating profit was down by 2% to CHF 33.7 million. In local currencies, however operating profit was up by 2%. This result includes non-recurring costs of CHF 2.1 million arising from the strategic IT project and an audit of the half-yearly figures in anticipation of the planned merger between ALSO and Actebis. Net profit during the first nine months increased by 9% (10% in local currencies) to CHF 16.3 million compared with the same period in 2009.
Developments in individual market segments
In the Switzerland/Germany market segment, demand from the corporate sector for IT products during the third quarter was higher than last year; in the private sector it was, at best, the same.
In the first nine months ALSO increased net sales in this segment by 1% (+7% in local currencies) to CHF 2072 million compared with last year. Both countries contributed to this positive development. Due to the slightly lower gross margin as well as the weak euro, the operating profit of CHF 31.1 million was down on the result for the same period last year. Profit before tax was CHF 22.3 million.
In the Northern/Eastern Europe market segment, the demand for IT products in Finland and Norway rose slightly during the third quarter in both the corporate and private sectors. In the Baltic states, the commercial sector finally reported growth again, due mainly to increasing demand from public authorities. Private consumption, however, remained pegged at the same level as last year.
During the first nine months, net sales in this market segment were down by 3% (as a result of exchange rate movements) to CHF 895 million; in local currencies, net sales were up by 5%. The operating profit of CHF 4.2 million and profit before tax of CHF 2.1 million were substantially higher than the figures for the same period last year.
Status of the planned merger with Actebis
Work on the planned merger between ALSO and Actebis is so far progressing according to plan. The aim is to conclude the transaction before the end of 2010. The completion of the merger depends on the finalization and positive outcome of the due diligence process, the concluding of the merger agreement, the approval of the responsible competition authorities and the approval of the ALSO shareholders and the relevant management bodies of the Droege Group AG.
Outlook for 2010: net profit of CHF 22 to 25 million
Economic developments in the European markets remain unsure. At the present moment it is therefore difficult to predict exactly how demand will move in the fourth quarter, which is traditionally the strongest. Including non-recurring costs related to the planned merger with Actebis and barring unforeseen circumstances, ALSO expects a net profit of CHF 22 to 25 million for 2010 (2009: CHF 15 million).