Demand dive hits swimming pool equipment maker Fluidra
Reuters
Published Oct 28, 2022 08:26
Updated Oct 28, 2022 10:46
By Joan Faus
BARCELONA (Reuters) -Spain's Fluidra on Friday reported a 19% drop in nine-month net profit as soaring energy prices, higher interest rates and Europe's economic slowdown curbed people's desire for domestic swimming pools.
Since pandemic lockdowns at the start of 2020, Fluidra had benefited from wealthy customers' appetite for buying or upgrading pools with cash they could not spend on vacations or on outside entertainment.
But it downgraded its outlook last week, saying it expected full-year sales to be around 2.4 billion euros ($2.39 billion) compared to previous guidance of 2.5 billion-2.6 billion euros.
The company said it expects the slowdown in demand to deepen in the fourth quarter, and that it was reducing its inventory, but it also said it was "a stronger company compared to 2019" following its expansion in North America and Europe.
Nine-month net profit totalled 179.4 million euros. CM Capital Markets said the figure was negative for the stock as it came below consensus estimates.
Fluidra shares were down 2.5% at 0930 GMT, underperforming the blue-chip index, which fell 0.85% from the previous day's close. The company's share price has fallen 63% so far this year.
JP Morgan analysts described Fluidra's results as unsurprising, saying downside risks to its "neutral" rating included a deteriorating trading environment, an inability to push through price hikes and elevated energy prices holding consumers back.
Sales in the third quarter stagnated, increasing by just 0.9%, Fluidra said.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) reached 455.7 million euros, 1.2% higher than in the same period of last year.
Under its new guidance, EBITDA for the full year is expected to be above 500 million euros, compared with a previous forecast of between 600 million and 630 million euros.
($1 = 1.0061 euros)
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