GfK Growth Continues in Q3

GfK has reported a good performance for the third quarter and first nine months of 2011. Q3 organic sales growth was 5.2% and the adjusted margin was up slightly on Q3 the previous year to 15.7%. Sales in the first 9 months of the year totalled EUR 999m - up 7.1% (7.0% organic).

EBIT rose by 23.4% on the previous year to EUR 121.4m. Margin for the first nine months rose from 12.99% to 13.1%, with a good performance in the Custom Research and Retail and Technology sectors off-setting one-off costs in the Media and Other sectors. The latter included a write-down on TV ratings software, implementation of the Own the Future strategy and expenses for the early termination of the contract of a Management Board member.

For the full year, the company expects organic sales growth between 5% and 6% and a margin similar to the previous year.

GfK says all its global regions except North America recorded strong sales growth, with Central and Eastern Europe (up 18.2%) and Latin America (13.0%) leading the way. The Group's GfK order book is very healthy with a total of 96.8% of the year's expected sales booked, up from 94.4% this time last year.

In terms of sectors, Custom Research achieved 6.9% sales growth in the 9 months, to EUR 598m (organic growth 6.5%); while margin improved from 6.0% in the previous year to 6.5%. The Retail and Technology sector achieved double-digit sales growth of 10.4% to EUR 299m (10.2% organic). Margin rose from an already stratospheric 29.4% to 30.8%.

Sales in the Media sector were up 1.8% in organic terms but with negative currency effects fell 0.4% to EUR 98m. Organic sales growth was highest in Germany and North America. Margin, one the above write-down is removed, was 11.1% (2010 11.4%). Sales generated by the Group's 'Other' segment were fairly static at EUR 3.6m.

'Own the Future', which aims to provide clients with a more connected global organization and better access to GfK's global expertise, is progressing with 'the necessary structures drafted' and new global and regional management roles created, says GfK, leading to a formal launch on 1st January 2012.

Outgoing CEO Professor Dr. Klaus L. Wübbenhorst said the firm had 'continued on its growth course'. Professor Dr. Wübbenhorst advised the Supervisory Board in February that for personal reasons he would not be extending his contract. Former IBM bigwig Matthias Hartmann will take over responsibility in two weeks' time, on December 1st.

Web site: www.gfk.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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