HIGHLIGHTS FROM 2013 Business Performance ECCO’s controlled growth strategy for 2013 was successful. At a static volume, revenue in 2013 grew by 4.4% (6.3% at constant foreign exchange rates). Profit before tax increased by 8%. The year’s result is EUR 106.4m against EUR 91.8m in 2012 – a growth of 15.8%. The result is the best ever in the history of the company. The focus in 2013 was on creating more value in ECCO’s products to appeal to ECCO’s loyal customers. Many of the new products were received very well in the marketplace. The strong growth in accessories sales, and the sale of leather to external customers, continued unabated. ECCO continued its drive to increase branded space and by the end of 2013, ECCO had 1,177 shops and 1,812 shop-in-shops across the world. ECCO also refurbished more than 300 shops in 2013. In all, ECCO sells its products from 15,000 sales points in 87 countries. ECCO’s geographical diversification moved ahead. This reduced the dependence on ECCO’s historic core markets in Europe. The main growth area was Asia. 2013 was the busiest year ever for ECCO’s production companies: ECCO Leather Group based in the Netherlands, and Global Shoe Production based in Singapore. The tannery in Indonesia was completely rebuilt; a new tannery for luxury leathers was built in the Netherlands and the Dutch beam house finalised the construction of its new wastewater and biogas facility. The rebuilding of the shoe factory in Thailand was completed and all activities in Thailand were concentrated in Ayutthaya. The Chinese and Indonesian factories were expanded and the Portuguese factory re-started. In spite of these major changes, production was maintained throughout 2013 without interruption. Financial performance Net revenue was EUR 1.131m, an increase of EUR 47.9m, equivalent to 4.4%. Profit before tax was EUR 165.4m, an increase of 8% over 2012. This produced a profit ratio of 14.6%, against 14.1% last year. The year’s company tax is calculated at EUR 40.3m against EUR 43.1m in 2012. The total assets increased from EUR 760.2m to EUR 772.5m and the equity increased from EUR 418.4m to EUR 461.6m. ECCO Sko’s solvency at year end was 59.8% against 55% last year. The return on equity increased from 22.6% to 24.2%. Organisation ECCO is investing more money than ever in training and developing our world-wide staff, now numbering 18,500 people. During 2013, more than 7,000 of ECCO’s employees undertook some form of education, short or long-term. This builds up the internal competences necessary to operate and manage ECCO’s complex supply chain “from Cow to Customer”, which is the key to ensure constantly high quality products. Outlook ECCO in 2014 intends to continue its controlled growth strategy. We expect revenue and profit in 2014 to increase above 2013. ECCO Annual Report 2013 3
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