Annual Report 2009/10 Excellence in Retailing - Douglas Holding

70 Management Report
Key results
Business activities and operating environment
Net assets, financial position and result of operations
DOUGLAS HOLDING AG
Subsequent events
Control system and success factors
Opportunities and risks situation
Statutory disclosures
Forecast and overall assessment
Given the improvement in consumer confidence, the Group’s sales proved sound
at the start of the new 2010/11 fiscal year. During the first quarter of the 2010/11 fiscal
year – which includes the important Christmas business – sales were up about 4 percent.
Like-for-like, Group sales were almost 2 percent higher than in the previous year’s quarter.
The German Retail Association HDE is projecting an overall increase in turnover of
1.5 percent for 2010. While yet to issue a concrete forecast for 2011, it is expecting a steady
development. Similarly, the various industries had yet to publish specific projections for the
new year by the start of 2011. However, the mood in the perfumery market appears to be
brightening, according to a fall 2010 survey by the German Perfumeries Association, with
the trend for 2011 holding steady. Sales at Germany’s stationary bookstores were down
approximately 3 percent during 2010, according to the industry’s BuchReport magazine.
No estimate has been provided as yet for 2011. The German Federation of Jewelry and
Watch Retailers is anticipating that sales will have increased by some 6 percent in 2010,
although this is largely due to higher material costs. Industry analysts project that the
watch and jewelry market should develop steadily during 2011, provided the general economic
climate does not change significantly. According to the magazine Textilwirtschaft,
the German fashion industry posted a 3 to 4 percent gain in sales during 2010; prospects
for 2011 are optimistic. The market research institute IRI concluded that confectionery segment
sales had declined slightly as at the end of October 2010; the industry’s professional
associations have yet to venture forecasts for 2011.
From today’s standpoint, the Executive Board predicts a sales increase of between
2 and 4 percent and earnings before taxes of about 140 million EUR. For purposes of promoting
further growth of the DOUGLAS Group, a capital expenditure volume of about
125 million EUR is available. The shareholder-friendly dividend policy will be continued.
Therefore, a payout ratio of about half of consolidated net income is the future target as
well. The forecast takes into account all those events known at the time of preparing the
financial statements which might impact the business developments of the DOUGLAS
Group.
Hagen, January 2011
DOUGLAS HOLDING AG
The Executive Board
Dr. Henning Kreke Dr. Burkhard Bamberger Anke Giesen