EUR 203.58 For Business Accounts Only

Dufry 3Q17 - Delivering on organic growth and deleveraging

Dufry, the world’s largest travel retailer (with 92% of sales in airport retail), has published another set of solid results, for 3Q17 (the key quarter in terms of intra-year seasonality), in line with those for the first half of the year. Organic sales growth remained at a high level, at 7.6% yoy (LFL +6.4%; new concessions +1.2%) in Q3, after 8.9% in Q2 and 7.2% in Q1. Including FX, reported sales increased by 8.1% to CHF 2.4bn. This strong performance was spread across all regions, including double-digit sales growth in Africa, Turkey, and Asia. International passenger growth, the main driver of organic sales, stood at 8.9% in the first eight months of 2017. The rate is expected to moderate to 5-6% by 2019. Profitability was again supported by the ramp-up of synergies with World Duty Free. However, similar to previous quarters, the gross margin progression of 80 bps in Q3 was not fully translated into the EBITDA margin, which was up +20 bps to 13.6%, due to higher concession fees (especially in Spain).