16.04.2020 – Lalique Group SA

Lalique Group announces 2019 annual results

Lalique Group SA / Key word(s): Annual Results
Lalique Group announces 2019 annual results

16-Apr-2020 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.



Lalique Group announces 2019 annual results

Zurich, 16 April 2020 - Lalique Group SA (SIX: LLQ), which is active in the
creation, development, marketing and worldwide distribution of luxury goods,
increased Group operating revenue by 5% year-on-year to EUR 143.5 million
and reported earnings before interest and taxes (EBIT) of EUR 1.4 million in
2019. As previously announced, Lalique Group expects its results for the
current year to be adversely affected by the Covid-19 situation. The Board
of Directors therefore proposes to shareholders that no dividend be
distributed for the 2019 financial year.

A telephone conference for investors, analysts and the media will be held
today at 10:00 am CEST.

As announced on 25 March 2020, and in line with the guidance published in
October 2019, Lalique Group achieved further moderate growth in sales in the
financial year 2019 in a challenging market environment. This was driven
primarily by continued strong growth in the Ultrasun segment and positive
developments of almost all brands in the perfume business and the Lalique
crystal business. The newly acquired stake in the Scottish whisky distillery
The Glenturret also contributed to growth. Sales were negatively impacted in
particular by a significant decline in higher-margin sales at Lalique
Parfums in the Middle East. Overall, Group operating revenue increased by 5%
to EUR 143.5 million compared with the previous year. This corresponds to
growth in local currencies of 5%.

Personnel costs increased to EUR 35.5 million during the year under review
(previous year: EUR 32.6 million), reflecting the expansion of the business
as planned. Other operating expenses decreased from EUR 32.4 million to EUR
30.0 million year-on-year, while depreciation rose from EUR 7.7 million to
EUR 14.8 million. This reflects the first-time application of IFRS 16, due
to which other operating expenses declined by EUR 7.7 million and
depreciation increased by EUR 6.9 million. If IFRS 16 is not applied, other
operating expenses would have increased by 16% to EUR 37.7 million and
depreciation would have risen by 3% to EUR 7.9 million due to growth and
investments. The growth and investment-related expenses reflect the planned
costs for international expansion and for restructuring in the US; this also
includes EUR 1.2 million of one-off expenses in connection with the
acquisition of a 50% stake in The Glenturret.

Earnings before interest and taxes (EBIT) totaled EUR 1.4 million in 2019
(previous year: EUR 6.1 million including extraordinary income of EUR 2.4
million related to legal proceedings) and was therefore at the upper end of
the guidance provided in October 2019. The EBIT margin was 1.0% compared
with 4.5% in the previous year. Excluding one-off costs related to the
acquisition of a 50% stake in The Glenturret, EBIT for the year under review
was EUR 2.6 million and the EBIT margin was 1.8%. Net Group profit was EUR
1.1 million compared with EUR 5.2 million in the previous year. The result
for the reporting year contains a positive effect of EUR 2.9 million arising
from the Swiss corporate tax reform, while the previous year's result
contained a positive effect of EUR 1.0 million due to the tax reform in

Segment results
The Lalique segment recorded a 2% decrease in sales to EUR 81.1 million in
2019. The crystal business grew by 7% year-on-year, whereby China and Russia
in particular developed very positively. In contrast, the perfume business
recorded a decline of 18%, which is mainly attributable to the
aforementioned difficult market and operating conditions in the Middle East.
Costs rose by 4% and reflect the expansion of the business, particularly in
Asia, where a new boutique in Beijing and four new shop-in-shops in Japan
were opened in 2019, as well as restructuring in the US. EBIT was EUR -6.9
million (previous year: EUR -1.7 million, including an extraordinary income
of EUR 2.4 million).

Ultrasun once again achieved a very good result for the year under review.
Especially in China, Switzerland and the Netherlands, the segment recorded
continued growth, and new markets such as Taiwan and Korea also closed the
year with solid results. The strategy adopted, which places increased focus
on distribution through pharmacies and drugstores, continued to pay off.
Overall, sales rose by 25% to EUR 21.8 million with a higher gross profit
margin, while expenses increased by 19%, also reflecting higher personnel
and marketing costs resulting from the expansion of the business. EBIT
increased to EUR 4.1 million (previous year: EUR 2.2 million).

In the other segments, Jaguar Fragrances recorded a further increase in
sales of 5% following a good result in the previous year. A significant
decline in the Middle East was offset by sales growth in other markets - in
particular in Europe, but also in North America and Asia. With sales growth
of 20%, Parfums Grès reported a very positive result for 2019, benefiting
from a strong recovery in key markets such as Spain, France, Latin America
and Israel. The launch of the perfume "Cabochard chérie" and the re-launch
of "Cabochard" also contributed to the positive development of Parfums Grès.

Among the other brands, Bentley Fragrances ended 2019 with growth of 5%,
which is primarily attributable to higher sales in the US and the UK.
Following a decline in 2018, Parfums Samouraï reported an appreciable
recovery and grew by 9%. Two new launches and strong follow-up orders for
existing product lines were the foundation for the positive growth in 2019.
The perfume filling and logistics operation Lalique Beauty Services also
developed positively. With the new filling facility that began operations in
the fall of 2018, the productivity and capacities for new portfolio brands
such as Brioni as well as for third-party clients were significantly
increased. The whisky distillery The Glenturret, which has been fully
consolidated in the accounts of Lalique Group since the acquisition on 28
March 2019, generated sales of EUR 1.9 million for the months from April
until December 2019, which is in line with expectations.

As previously announced, before the lockdown measures imposed by the
authorities around the world in mid-March 2020 to combat Covid-19, Lalique
Group's business was less affected than initially expected when the crisis
began in China. However, the company expects its business operations to be
adversely affected during the remainder of the year, in particular due to
the closure of points of sale and interruptions in supply chains.

In light of this situation, Lalique Group swiftly introduced measures to
maintain the company's solid capital and liquidity position. In a first
step, marketing activities were significantly reduced and a number of
projects for the development and launch of new collections and product lines
were suspended until further notice. In addition, Lalique Group has applied
for short-time work or comparable support measures for the majority of
employees at its headquarters in Zurich, all locations in France, including
the crystal manufactory in Wingen-sur-Moder and the perfume filling plant in
Ury, as well as overseas. In contrast, digital marketing and online
distribution activities will be further expanded. The preparations for the
launch of the first perfume under the new Brioni license scheduled for the
fourth quarter of 2020 are proceeding according to plan. The Rebranding of
the Glenturret distillery is also making progress and will be launched
simultaneously with the new whisky range developed under the lead of
renowned whisky Maker Bob Dalgarno.

Further to this, the Board of Directors has decided that in light of the
Covid-19 situation, it will propose to the Annual General Meeting on 8 May
2020 that no divided be distributed for the 2019 financial year. For their
part, the members of the Board of Directors and the Executive Board have
announced that they will contribute to the measures to preserve liquidity in
the form of decreased salaries and bonuses.

Due to the unpredictability of the further developments, it is not possible
to provide more specific information on the course of business of Lalique
Group at this point in time. This depends on the duration of the Covid-19
pandemic and the related restrictions on business operations, as well as on
how long it takes for the economic recovery in the various market regions to
take hold. Lalique Group expects that in its portfolio, demand is likely to
increase fastest for products for everyday use and in the lower price
segment. For luxury products, namely in the Lalique segment, a rise in
demand could be slower, although Lalique Group has a loyal customer base in
this area that reacts less sensitively to general economic conditions, as
has been demonstrated to some extent in the course of the year to date.

Lalique Group is convinced that the diversification strategy it has been
pursuing for a number of years and the breadth of its business are
fundamental strengths that will benefit the Group, also if the difficult
economic environment persists for an extended period. Taking into account
the Covid-19 situation, Lalique Group will continue to systematically
implement its strategy and will also place a focus on specific regions. With
regard to the medium-term goals communicated to date (sales growth in the
mid-single digit percentage range in local currencies and a gradual increase
in the EBIT margin to 9%-11%), Lalique Group currently expects that the
achievement of these targets will be delayed, depending on how markets
recover from the current crisis.

Roger von der Weid, CEO of Lalique Group: "In 2019, we achieved further
growth and made significant investments in our business's broad base. We are
convinced that diversification is a key strength of Lalique Group,
particularly in the current, very difficult economic situation. We are
following the developments in the coronavirus pandemic as well as its impact
on the economy very closely, and I would like to thank all our employees for
their professionalism in this extraordinary situation. We have introduced
stringent measures to protect our profitability and to maintain Lalique
Group's solid financial position. At the same time, we are continuing to
concentrate on the implementation of our strategic initiatives."

Proposal for election to the Board of Directors
At the Annual General Meeting on 8 May 2020, the Board of Directors will
propose to shareholders the election of Sanjeev Malhan as a new Board
member. Sanjeev Malhan (49) has been Chief Financial Officer of India-based
DS Group's confectionery business since October 2018. DS Group, founded in
1929 as a small perfume business, is today a broadly diversified
conglomerate with headquarters in Noida, India, and in June 2019, acquired
12.3% of Lalique Group. Among other industries, its portfolio spans food &
beverage, hospitality, packaging and agriculture.

Sanjeev Malhan is an Indian citizen and graduated with a Bachelor of
Commerce from the University of Delhi. He has over 25 years of experience as
a financial specialist and has worked at a number of Fortune 500 companies
in the energy, engineering, electronics and consumer goods industries. In
addition to his capital market know-how, he has proven expertise in the
areas of strategic financial planning as well as cost and working capital
management. The Board of Directors is convinced that as a Board member,
Sanjeev Malhan will make an important contribution to the future success of
the Group.

All of the existing Board members and Silvio Denz as Chairman are standing
for re-election for a further term of office of one year. The invitation
containing the full agenda can be found on Lalique Group's website.

Note to the 2018 annual financial statements: agreement reached with SIX
Exchange Regulation
Lalique Group has reached an agreement with SIX Exchange Regulation in
connection with breaches of financial reporting standards (IFRS) in the 2018
financial statements. In the cash flow statement of the IFRS annual
financial statements 2018, Lalique Group recognized bank overdrafts drawn as
an integral part of cash and cash equivalents. In consequence, the opening
and closing balance of cash and cash equivalents was reported as a negative
amount in the cash flow statement. As a result, the changes in these bank
overdrafts drawn were not recognized in cash flows from financing
activities. This breach led to adjustments in the cash flow statement. As
part of the agreement, Lalique Group undertook to correct this in the IFRS
2019 annual financial statements and to donate CHF 15,000 to the IFRS

Documentation on full-year results 2019
The following documents are available on Lalique Group's website:
Media release www.lalique-group.com/media
Results presentation www.lalique-group.com/financial?section=presentations
Annual Report www.lalique-group.com/financial?section=reporting
Invitation to the General Assembly www.lalique-group.com/assembly

Conference call for investors, analysts and the media
Date: Thursday, 16 April 2020
Time: 10:00 a.m. CEST
Speakers: Roger von der Weid, CEO; Alexis Rubinstein, CFO

Dial-in numbers:
Switzerland +41 (0) 58 310 50 00
France +33 (0) 1 7091 87 06
UK +44 (0) 207 107 0613
US +1 (1) 631 570 56 13

Media contact
Lalique Group SA
Esther Fuchs
Senior Communication & PR Manager
Grubenstrasse 18
CH-8045 Zurich

Phone: +41 43 499 45 58

Lalique Group
Lalique Group is a niche player in the creation, development, marketing and
global distribution of luxury goods. Its business areas comprise perfumes,
cosmetics, crystal, jewellery, high-end furniture and living accessories,
along with art, gastronomy and hospitality as well as single malt whisky.
Founded in 2000, the company employs approx. 720 staff and has its
headquarters in Zurich. The Lalique brand, from which the Group derives its
name, was created in Paris in 1888 by the master glassmaker and jewellery
designer René Lalique. The registered shares of Lalique Group SA (LLQ) are
listed on the SIX Swiss Exchange.

You can find further information at: www.lalique-group.com.

Development of key figures for Lalique Group

In EUR million

                                                    2019     2018
     Operating revenue                             143.5    136.4
     Gross result                                   81.8     78.8
     Salaries and wages                            -35.5    -32.6
     Other operating expenses                      -30.0    -32.4
     EBITDA                                         16.2     13.8
     Depreciation and amortisation / impairment    -14.8     -7.7
     EBIT                                            1.4      6.1
     EBIT margin                                    1.0%     4.5%
     Financial result                               -1.9     -0.4
     Net Group profit                                1.6      5.2

     Earnings per share    0.52    1.09
In EUR million

                                         31.12.2019     31.12.2018
     Total equity (before shares with         171.9          128.1
     non-controlling interests)
     Equity ratio                             50.1%          54.0%
1 The Group has restated the comparative period as at 31 December 2018 for
the correction of an error in deferred taxes

The complete consolidated financial statements for 2019 are available at


End of ad hoc announcement