Annual report 2022/23

A challenging year for Bang & Olufsen, aims to return to profitable growth in 2023/24 - Seite 3

• Revenue declined by 7.5% (-10% in local currencies). Both product sales and Brand partnering & others declined in the period. Macroeconomic headwinds impacted EMEA and Americas while Asia was on par with last year. Brand Partnering was impacted by lower licence income from HP.
• Like-for-like, sell-out grew by 7% driven by solid growth rate in Asia of 30%. EMEA had growth of 1% while Americas declined 5%. Like-for-like sell-out growth was positive across channels and the company-owned stores grew 10% in the quarter.
• The gross margin was 51.4%, which was 3.2pp higher than last year. Compared to the third quarter, gross margin increased by 7.8pp.
• No component spot buys affected the quarter and freight cost was significantly below last year.
• EBIT before special items was DKK 9m, equivalent to an EBIT margin before special items of 1.4%, against 1.7% last year.
• Free cash flow was DKK 27m (Q4 21/22: DKK -190m).

Strategic initiatives

• The Win City concept in London delivered 24% year-on-year like-for-like sell-out growth supported by strong performance in Company owned stores and monobrand. The Win City concept was launched in Q4 in Paris, where we in the last quarter had sell-out growth of 18% driven by company owned stores but also monobrand and eCommerce.
• New York like-for-like sell-out declined 6% in Q4, with company owned stores performing relatively better with a decline of 2%. The company started executing on the Win City concept in Q4.
• Seven product innovations were launched during the year. The Beosound Emerge was successfully relaunched. In Q2, the company saw the launch of Beosound Theatre, and in March, Beosound A9 and Beosound 2 were launched on the new modular platform. In addition, the Beovision Harmony became available in 97 inches, and at year-end the company launched the Beosound A5.
• The Beocom Portal was MS Teams certified and now has both Zoom and MS Teams certification.
• The company submitted the second cradle-to-cradle certified product, and Beosound Emerge was certified in June 2023.
• 25% customer growth and 27% growth in number of customers owning two or more products.
• In February, the company entered into a partnership with Scuderia Ferrari for the 2023 formula 1 season. The collaboration was expanded with a product collaboration, which will launch during autumn.
• The company has set emission reduction targets according to the Science Based Target initiatives, which include target of operational Net zero targets in 2026/27 (scope 1 and 2) and Net zero across the value chain by 2039/2040.

Outlook