Thanks in part to efforts to boost its omni-channel capacities, GrandVision posted strong results for the second quarter of the year, with sales jumping by 6.2 percent from the year-ago period to €1,021 million, or by 7.1 percent in constant currencies. Comparable sales advanced by 2.5 percent.
The French-based optical retail group controlled by Hal Holding focused on improving its omni-channel capacities. Among other initiatives, investments in online appointment booking tools led them to increase by more than 40 percent in the quarter.
The group achieved growth of 60 percent in e-commerce – an area in which Essilor has invested heavily as well. At GrandVision, the growth was driven mainly by the Lenstore business, which is now active in three markets: the U.K., Italy and Germany. During the quarter, the group launched Sonnenbrillen.com in Germany and Lunettesdesoleil.com in France, based on its Zonnebrillen.com platform in the Netherlands. It also went live with Sightful.nl, a new website selling contact lens only in the Netherlands and Belgium.
Sales of prescription frames and contact lenses outperformed sales of sunglasses during the period, which faced a difficult comparison base with last year's quarter.
The adjusted Ebitda progressed by 1.0 percent to €255 million, partly driven by operational improvements in the Benelux region and better operating leverage.
At the end of the period, GrandVision's store network increased to 7,265 stores, up from 7,216 at the end of March, led by store openings and acquisitions. The management said the integration of recent acquisitions is progressing well, and Spain's Optica 2000 is already contributing to the Ebitda of the Other Europe segment. It has also seen robust comparable growth of more than 4 percent since its acquisition in February.
In the G4 segment, which comprises the stores operating in France, Luxembourg, Germany, Austria, the Netherlands, Belgium, the U.K. and Ireland, the group's sales increased by 4.5 percent in constant currencies, reaching €570 million, with organic growth and comparable store growth of 2.7 percent and 1.8 percent, respectively. Acquisitions contributed 1.8 percentage points to the overall sales increase in the region.
Comparable growth was impacted by the timing of the Easter school holidays and the heatwave in June, following a very strong first-quarter performance. The company saw a recovery in Benelux, with improved levels of comparable growth and an acceleration in profitability. In France, the business continued to gain market share, driven by the group's value proposition, as customers become more price-sensitive following recent regulatory changes. In Germany, revenues continued to increase through strong comparable growth and the acquisition of a franchise business, while in the U.K., comparable growth continued to be impacted by an overall weak retail environment. However, this was more than compensated for by growth in online sales, as well as stronger performance at the recently acquired Tesco optical stores.
The adjusted Ebitda margin in the G4 segment improved by 0.7 percentage points to 19.3 percent, driven by strong performance in Benelux and France.
In the Other Europe segment, revenues grew by 8.4 percent at constant exchange rates to €319 million, with organic growth of 1.1 percent and comparable growth of 3.8 percent. Acquisitions, primarily that of Optica 2000 in Spain, contributed 7.3 percentage points. The segment saw flat comparable growth during the quarter following a strong start to the year. The region was also impacted by fewer selling days than in the previous year due to the timing of the Easter holiday, especially in Northern Europe and Switzerland.
The adjusted Ebitda margin contracted by 1.6 percentage points to 15.2 percent in the Other Europe segment because of lower operating leverage in the more profitable Northern European markets and Switzerland, which had benefited from a strong commercial campaign in the previous year.
In the Americas & Asia segment, revenues climbed by 15.8 percent to €132 million in constant currencies. On a comparable basis, sales rose by 9.4 percent, and the organic growth rate surged by 15.7 percent. The U.S. returned to growth following the implementation of the new POS system. The adjusted Ebitda margin in the segment was up by 0.5 percentage points to 4.0 percent.
GrandVision has set new medium-term objectives. It expects medium-term average revenue growth of at least 5 percent at constant exchange rates, which includes on average at least three percentage points from comparable growth, plus contributions of at least one percentage point from store openings and at least one percentage point from small acquisitions.
For the remainder of the year, the group expects that its Ebitda will benefit in the second half from lower incremental investments and operating leverage within its existing business.
GrandVision published its first-half results one day before planned to coincide with the release of EssilorLuxottica's results and with the confirmation of the contract for Essilux' takeover of GrandVision, allowing financial analysts to ask questions about the deal.