financial report and registration document 2011 - Groupe SEB

In North America, 2011 was marked by two contrasting macroeconomic
environments, with the situation being rather favourable in Mexico and
Canada, and somewhat grim in the United States, where demand largely
remained fl at, despite a spike in consumer spending at the end of the year,
spurred by a very brisk Black Friday. In general, the US small domestic
equipment market was lacklustre, with a strong focus on price. Groupe
SEB ended the year with slight organic growth in sales, after a year of
fl uctuations depending on the quarter, product family and brands. After
three diffi cult years, Krups demonstrated outstanding performance in 2011
thanks to various coffee-related successes, while Rowenta defended its
position in a declining ironing market. The Group also made progress in the
area of electrical appliances (launch of Actifry, grills, slow cookers, etc.). In
cookware, business stalled after a number of years of uninterrupted steady
growth, yet there was some growth in sales, helped along by a clear jump
in All-Clad sales during the last quarter. In addition to this slight organic
growth, Imusa USA (consolidated for ten months) had a strong showing in
2011. The Group also confi rmed the vitality of its sales and market share
gains in Canada, both in cookware and in small domestic appliances, where it
benefi ted from numerous commercial successes in ironing and the confi rmed
success of Actifry. In Mexico, the Group’s operations performed solidly in
2011. However, sales were affected for a long time by the non-recurrence
of a loyalty programme with a retailer. This programme was not relaunched
until October, thereby boosting fourth quarter performance and bolstering
market share.
In South America, the general situation was a mix between Brazil, where the
economic context weakened as the year progressed with a sudden downturn
in December, and the other countries, with the exception of Argentina, where
the market was thriving. In Brazil, the booming economy at the beginning of
the year gradually tapered off, but remained quite satisfactory. The fourth
quarter, however, brought a heightened slowdown in consumer spending
together with weather conditions that were unfavourable for fan sales. The
Group’s business was affected by these factors – 2010 representing a high
historical basis for comparison – but the performance of Dolce Gusto, Actifry,
personal care products, Fresh Express, washing machines and cookware
offset the loss of earnings from fans. At the same time, upgrades to the
Group’s retail outlets opened in 2010 had a positive impact on business.
In Colombia, amidst highly favourable consumer spending levels, the
sharp rise in sales owed itself to the expansion of the product offering and
the performance of the Group’s retail outlets. Furthermore, the Group’s
acquisition of Imusa in February allowed it to strengthen its position in
cookware and gave it the ability to further leverage the complementarity
between the Samurai, Tefal, Imusa, and Rowenta brands (Rowenta was
recently introduced as a line of personal care products). In the other South
American countries where the Group enjoys a presence, business was
encouraging on the whole.
In the Asia/Pacifi c region, the Group experienced growth across the board.
In China, the economic climate remained buoyant, yet more volatile than
previously. After a very strong start in the fi rst quarter (organic growth of
38%), Supor’s operations “stabilised,” growing by 26% for the year and 20%
over the last quarter. This growth is connected to strong product performance
Financial Report and Registration Document 2011
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Commentary on the fi nancial year
Commentary on 2011 consolidated sales
that revolves around rapid rotation of the product mix, the launching of
innovative concepts – such as ultra-thin induction hobs or induction pressure
cookers and rice cookers – and the introduction of new categories (thermos
items, kitchen utensils, etc.). It is also the result of continuous new product
listings obtained with major international retailers and specialised outlets, as
well as the continuing deployment of Supor Lifestores. The double impact of
the Chinese New Year on 2011 sales is also worth noting, with procurement
specifically targeting this event during both the first quarter (for 2011)
and the fourth quarter (for 2012). In Japan, the macroeconomic situation
improved as the months went on, with reconstruction generating business
and confi dence, together with a resumption of consumer spending. The
Group was able to take advantage of this renewed enthusiasm, and while
sales held steady during the fi rst half of the year, they made progress during
the second half, characterised by steady growth in cookware and electric
kettles and rapid growth in food preparation. In Korea, sales growth was
strong and market share increased, primarily as a result of the creation of
two new growth drivers for the Group: food preparation (Tefal) and personal
care products (Rowenta). Lastly, after two very diffi cult years, 2011 marked
a return to growth for Australia, as a result of factors including the expansion
of the range of products and by the success of Actifry, Fresh Express, the
Air Force vacuum cleaner, irons and steam generators.
In Central Europe, Russia and other countries (Turkey, the Middle East,
Africa, etc.), markets were, for the most part, buoyant in 2011, yet with
heightened focus on pricing. Despite signifi cant depreciation of various
currencies with respect to the euro and the price increases applied by
the Group to compensate for currency fluctuations, sales experienced
robust organic growth in the region and market share was strengthened,
in general. In Russia, 2011 was characterised by solid consumer spending,
by a generally healthy retail distribution situation and by fi erce competition
in the area of small domestic equipment. However, the Group’s operations
experienced sharp growth, which strengthened as the year went on,
refl ecting this brisk demand and the success of fl agship products such
as meat mincers, irons, cookware, Nespresso and Dolce Gusto coffee
makers, the MultiDelices yoghurt maker and hairstyling appliances, etc. All
of these products were supported by substantial advertising and marketing
operations. In the Ukraine, the strong momentum seen at the beginning of
the year held, thanks to a variety of fl agship products and by vigorous and
highly encouraging growth in cookware. Conversely, the strong driving force
behind Central European sales during the fi rst seven to eight months of the
year noticeably slackened from September as a result of business disruptions
caused by currency depreciations and a more-demanding historical basis
for comparison in the fourth quarter. In Turkey, demand remained strong and
the cookware and small domestic appliance markets posted very robust
growth. Groupe SEB played a large part in this growth through various
fl agship products that drove the entire range of products: Actifry, which has
moved away from its original purposes as a “minimal-oil fryer” and widely
acclaimed for its versatility, Fresh Express, the Air Force vacuum cleaner,
pressure cookers and the Yogurtcum yoghurt maker, designed for the Turkish
market. As for the other export markets of the Group, these posted excellent
business results, up signifi cantly from 2010.
GROUPE SEB
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