BARCELONA, Spain--(BUSINESS WIRE)--
Fluidra, global leader in pool and wellness equipment and connected solutions, today provided an update on its third quarter financial results and its full year outlook as trading conditions have been weaker than anticipated during the third quarter.
Fluidra now anticipates third-quarter sales around 520 million, down year-on-year 7% forex adjusted; and EBITDA about 95 million. Net Debt/LTM EBITDA leverage ratio is expected at c.2.4x. The company will provide more details on third-quarter results on October 28.
The company’s financial performance is affected in the short term by a higher than expected channel inventory correction in a more uncertain economic environment. Supply chain disruptions coupled with accelerated demand in 2020 and 2021 generated high stock levels along the supply chain. Inflation further accelerated the inventory build-up as, particularly in North America, distribution bought additional stock to beat price increases. Fluidra is now seeing a normalization of inventory levels along the supply chain.
The macro-economic environment is also uncertain, especially in Europe, leading to softer demand, driven by low consumer confidence on the back of higher energy costs, other inflationary pressures and higher interest rates.
Based on the third quarter’s performance and the outlook for the remainder of the year Fluidra is adjusting its guidance for financial year 2022. Fluidra forecasts sales around 2.4 billion this year (which implies a growth of close to 10% year-on-year) and EBITDA is expected to be over 500 million.
Taking action and well positioned for the future
Fluidra has revised upwards the targets of its simplification program, which is currently being implemented, and is now expected to deliver savings of around 100 million over the next three years. This program focuses on redesigning its product offering to deliver cost benefits, streamlining the operations to be more efficient and simplifying the organization.
The business is transitioning towards a normalized ordering pattern in line with historical mid-single digit growth, driven by installed base growth coupled with a higher average ticket due to price and technological improvements in the renewal of pools.
The company has implemented significant price increases over the last 3 years and continues to see a positive read-through of pricing despite cost inflation. Furthermore, Aftermarket demand to serve a higher installed base after the step change of the industry in 2020 and 2021 and demand for commercial pool is expected to provide resilience going forward.
“Like many businesses around the world, we are experiencing a change in our trading conditions. Nevertheless, I am confident that we are well positioned to continue to lead the pool and wellness market with our customer centric approach, high quality and service, broad product portfolio, enlarged geographic footprint as well as our ongoing investment in connected pools and the widest sustainable products offering”, explains Eloi Planes, Fluidra’s Executive Chairman.
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