Flügger raises forecast – expects record result
Due to strongly rising demand from consumers in the Nordic markets in Q1 of the Group’s non-calendar financial year, Flügger is now adjusting its outlook for the 2020/21 financial year. The Group previously forecast EBIT of around 6%, equivalent to approx. DKK 120 million. EBIT is now expected to be in the DKK 130-150 million range, and revenue is expected to be above DKK 2 billion, up from the previous forecast of around DKK 2 billion.
The rise in demand during the first months of the financial year has been attributed to a positive impact from the COVID-19 pandemic, which has led to increased activity in the DIY segment. The financial result has also been positively impacted by efficiency improvements and the acquisition of paint manufacturer Unicell in November 2019.
“Consumers have spent extra time and money during the spring and summer to complete various renovation projects, and this has led to increased sales at Flügger across the Nordic markets. Sales to the professional segment, however, have been in line with expectations. We expected the consequences of COVID-19 to have a positive impact on our Nordic markets in Q1, but the level has surprised us to the upside. Given our excellent start to the financial year, we now believe that 2020/21 will be the year when Flügger achieves the historic milestone of more than DKK 2 billion in revenue, and record EBIT,” explains Jimmi Mortensen, CEO of Flügger.
Demand from consumers is expected to be at a normalised level for the remainder of the financial year. As stated in the latest annual report, some slowdown is expected in the professional segment, in part due to an expectation of fewer construction projects.
There is still a risk that revenue and earnings may be impacted by how the COVID-19 pandemic unfolds.