Press Releases

15/11/2016

AB Group – leader of the IT solution distribution market in Poland – consistently increases advantage over competition

 

·    AB Group records another record quarter; the highest business efficiency in the industry, the best risk management and taking care of the long-term increase in value for shareholders;

 

·    The Group continues its upward trend of increasing market shares, strengthens its position as a leader in the IT solutions and consumer electronics in Poland as well as in the CEE region;

 

·    Further growth noted in VAD segment; along with a range of dynamically growing business projects, such as household appliances (+85%), gaming (+228%) and digital signage (+250%);

 

·    Sales via e-commerce tools increased by 45% year on year, an increase that is three times faster than the B2C e-commerce market.

 


The summary of consolidated financial results year on year:

 

FY 2015/2016 (1.7.2015-30.6.2016)

FQ1 2016/2017 (1.7.2016-30.9.2016)

 

million PLN

million PLN*

Change*

million PLN

Change

Revenue

7.543,1

7.543,1

+11,0%

1.874,7

+24,6%

EBITDA

112,3

115,9

+7,0%

24,5

+8,0%

Net profit

64,6

69,1

+1,0%

14,1

+8,2%

Assets

1.839,3

1.839,3

+21,0%

1.920,5

+17,1%

Equity

584,4

584,4

+12,4%

598,8

+11,8%

(*) Values corrected for the logistics migration cost (transitional)

 

A record-breaking beginning of the new financial year.

AB Group, the leading distributor of IT solutions, household appliances and consumer electronics in Central and Eastern Europe notes the record-breaking first quarter of the new financial year after closing the previous one – FY 2015/2016 – as the best in the company’s history. Between July and September of 2016 (3rd quarter of the calendar year and 1st quarter of the financial year 2016/17), the AB Group noted a revenue of 1.9 billion PLN, which is 25% more than in the corresponding period of the previous year.

“The scale of our business is practically already 2-3 times larger than our nearest competition. We are strengthening our leading position not only in the CEE region, but also in Poland. In the 3rd quarter of 2016 we consequently increased the scale of our operations on all markets, noting a double-digit growth in all cases. All of this proves the strength of the foundations for long-term growth we built over 26 years of our business history”, said Andrzej Przybyło, Chairman of the Board of AB S.A.

Along with the revenues, also the net profit generated by the AB Group grew significantly more in the last quarter than in the last financial year, concluded in June this year. The real growth was in fact even more significant – it should be noted that Q4 2015 saw the beginning of depreciation write-offs for the new distribution centre (ca. 1 million PLN/quarter net) and bearing the cost of its financing (the value of investment amounts to 129 million PLN, including 24 million PLN from EU funds).

 “The competitive advantage of AB Group – the largest network of trading partners in the region, amounting to 16500 active accounts in Poland, Czech Republic and Slovakia – is becoming increasingly important. We are the first-choice distributor for manufacturers, as well as resellers. This is our motivation to be committed even more to working with our clients, listen to their needs and actively respond to the changes occurring on the market. We still have a lot to do in the existing markets, we also continue the analyses of the possible directions of further effective geographical expansion”, said Andrzej Przybyło.

 The strongest financial position

AB Group not only increased its profitability, but also managed to earn almost five times more than the nearest competitor, who in Q3 2016 noted a year on year decrease in net profit of 42%.

“Once again the facts confirm that thanks to having the highest competencies in trading, finances and logistics, as well as applying the principle of long-term sustainable development with strong emphasis on security, AB Group is able to generate solid profits and ensure stability to its shareholders, regardless of the market conditions”, said Grzegorz Ochędzan, CFO at AB S.A.

The results for the last quarter confirm the business and financial strengths of AB Group.

“We are maintaining high profitability compared to the industry, additionally for years we have been having the highest equity, which successfully grows every year. Because of that we have the highest potential for business development and we are the best partner for our suppliers, clients and financial institutions”, said Grzegorz Ochędzan.

“Moreover, despite the dynamic growth of the scale of the business, our net debt remains diversified and remains on a safe level. Additionally, over the course of three quarters of 2016 we managed to reduce our net debt by 93.5 million PLN and our operational cash flow grew by 115% year on year to 117.9 million PLN. As of now, AB Group is the strongest entity in the IT industry in Poland and the region in regards to both operational, as well as financial matters”, CFO at AB S.A. added.

 AB – a distributor of choice

The AB Group, as a leading entity in the IT solution distribution market in CEE region, is chosen as a regional partner in prestigious contracts, such as in the case of Apple and Microsoft. The Group also has unique opportunities to develop mutually beneficial large-scale cooperation with global giants of the IT industry, such as HP, Lenovo or Dell. Additionally, the systematic expansion of distribution also occurs in the case of the range of household appliances and toys, where AB Group has already built a leading position in Poland. In Q3 2016, AB Group signed new and expanded the existing distribution agreements with companies such as Microsoft (Surface), Samsung (full range of household appliances), iRobot (household appliances), TP-Link (smartphones), D-Link (networking solutions), Insta360 (digital cameras), Razer and Asus (gaming accessories).

“We are happy that AB Group noted growth in the value-added distribution (VAD) segment, in which we were active with our Competence Centre (540 people trained in three quarters) and the Academy of Integration (September 2016 – 150 participants). Moreover, in Q3 we dynamically increased the sales of toys and developed Wyspa Szkrabów – our new franchise network, while the sales of household appliances grew by astounding 85%. What is even more, Kakto – our franchise network – already surpassed 200 points of sale. Thanks to our in-house team of experts we managed to carry out many digital signage projects in the last quarter, which led to an increase in sales by 250% year on year. The sales of gaming accessories grew by 228% as well”, said Patrycja Gawarecka, Sales Director at AB S.A.

 E-commerce accelerating the success of AB Group

AB Group is constantly active in all sales channels, offering the largest selection of products and the best e-commerce solutions available on the market. Only in Poland the e-commerce B2C market is expected to grow by around 50 billion PLN in the upcoming years. Only those entities, which are already ready for the changes regarding state-of-the-art IT platforms, the most effective logistics matching the needs and requirements posed by e-commerce and a solid capital base can hope to emerge victorious from this sales channels revolution. Our competitive advantage also lies in the breadth of our product portfolio – AB Group is also the leader in that regard with almost 100 000 products available in our warehouses. In terms of logistics, AB Group owns three logistics centres, including one in Czech Republic and two in Poland. The usable area of the facility in Magnice, which was commissioned this year, amounts to four full-sized football fields, and it has twice the volume of the Centennial Hall. The warehouse and shipping systems used in the facility are the most innovative solutions currently available on the market, and they fully satisfy the requirements of the most demanding markets, such as e-commerce, tenders and retail network markets. As the financially strongest entity in the IT solutions distribution market in the CEE region, AB Group also built a leading e-commerce platform.

“As a result, we are already noting much faster growth in the field of B2C e-commerce sales than the entire market. In Q3 2016 our sales via e-commerce tools, such as xml integrations and Allegro module grew by 45% year on year, and that is despite the forecasts for the entire market conservatively predicting a 15% growth in 2016. The field of e-commerce will become increasingly significant accelerator of AB Group’s growth”, said Andrzej Przybyło.

 Experts appreciate AB Group

In October this year, AB Group was awarded the title of the “Pearl of the Polish Economy” by Polish Market magazine (with the Institute of Econometrics of the Warsaw School of Economics responsible for the substantive part of the competition), as well as the “2016 – Partner of the Year – Distributor” award by Microsoft. The distributor from Wrocław was recognised for recording the highest growth of cloud service sales on the Polish market (a fivefold increase year to year), as well as the most dynamic growth of on-line solution sales in the Indirect Cloud Solution Provider model. In October, AB also won the double IT Golden Ace title for the best Distributor and the Event of the Year (opening of the new AB Group Distribution Centre in Magnice), awarded by Reseller News magazine.

It is also worth noting that in August, CONTEXT – an organisation dealing with market analyses and pricing strategies in the ICT sector – also distinguished AB Group with three “Broadline Distributor of the Year 2015” titles, as a result of the largest survey in Europe, conducted among over 5000 resellers. We received the award in Poland, Czech Republic and Slovakia. Additionally, for the sixth time in a row AB Group won the “Distributor of the Year” title awarded by CRN magazine based on resellers’ votes. What is more, CRN also distinguished Andrzej Przybyło as the “IT Market Personality”, and Patrycja Gawarecka won the “Partner Channel Manager” award. AB Group also received numerous award from manufacturers, including HP and DEll. Our Chairman of the Board, Andrzej Przybyło also won the “Vector” Award given to him by the Employers of Poland and the Ernst&Young Entrepreneur of the Year title.