Accell Group N.V. said revenues grew by 11% and profits by 20% in the first half of 2008 due to sales of higher end bicycles and its acquisition of Ghost Mountainbikes.

 

Revenues reached €306 million ($467.9mm), thanks to organic growth of 6%, down from 10% in the first half of  2007. Still, the improved product mix caused net profit from ordinary operations to rise to €19.3 million ($29.5 mm),  up 20% from €16.1 million ($21.4 mm).


“In the first half of 2008 we realised a sound organic growth, especially given the exceptionally good weather in the first half of last year,” said René Takens, chairman of the Executive Board of Accell Group. “Bicycles in the higher segment, such as electric bikes and sporting bikes were much in demand these past six months, which contributed to an increase of our operating margin to 9.9%. In many European countries, especially in Germany and France, the sales of
bicycles increased.”

 

Takens said Accell was benefiting from an increased awareness of health, the environment and rising oil prices, which has propelled bicycle commuting. He said the company anticipates higher revenues
and 10% increase in net profit from ordinary activities for the full year.

 

Sales increased across all three categories, which include bicycles, bicycle parts and accessories. Demand for electric bicycles continued both in the Netherlands and in the rest of Europe. Revenues in the relatively small-scale fitness segment (6% of the group sales) failed to meet expectations in the past half year.

 

Netherlands contributed 45% of revenues, Germany 24%, France 27%,  other EU countries 14% and other countries 8%. Bicycle sales account for 77% percent of sales, parts and accesories 17% and fitness 6%.

 
In the first half of 2008 sales in the bicycles/bicycle parts & accessories segment reached 
€288.2 million ($440.7 mm), up 12% from €256.6 million ($340.8 mm) in the first half of 2007. The number of bicycles sold rose just 2.1% to 573,000 from 561,000 in the same period a year ago. The company said it did appear that electric bike sales cut into conventional bike sales.

 

In the United States, Accell said revenues at its Seattle Bike Supply (SBS) operation continued to grow against a backdrop of the credit crisis, high oil prices and pressure on consumer spending. The distribution of Lapierre via the SBS dealer network in North America also
continues to grow. The export of the SBS brand Redline (BMX bicycles) to Europe is still limited. However, Accell Group expects the Redline brand to grow, both in the US and abroad, through sponsoring of national teams and international racers who will be competing at the
Olympic Games in Beijing this year.