Group Beneteau announced results yesterday for its 2016/17 annual results confirming 12.6% annual growth in its Boat Division to reach sales revenue of €1.026bn (US$1.19bn) for the year ended 31 August 2017. The result means Beneteau joins the Brunswick Group as the only two production builders in the world to exceed US$1bn in leisure boat sales alone. Brunswick’s year-end result of US$1.37bn was achieved 31 December 2016, approximately US$176m (13%) ahead of Beneteau at today’s US-EUR exchange rate.
Brunswick is also nine months behind Beneteau in reporting annual boat sales figures, which the American builder has indicated are running a modest 4% ahead of last year through its third quarter ending September (reported by IBI yesterday). If the same rate of growth is sustained until the end of the year, that would put Brunswick’s 2017 boat revenues in the neighbourhood of US$1.42bn.
Beneteau's share price is up a strong 10% in trading today, hitting a 10-year high of €16.98, in response to yesterday’s financial report on total group revenues of €1.208bn, an 11.5% gain over the previous year. Profitability across the group was significantly improved with earnings before interest, taxes, depreciation and amortization (EBIDTA) up 30% to €153m, while Net Income (after taxes) lept 141% to €60m. EBITDA for the Boat Division was reported up 24% to €140m. The company’s stock price has risen 48% across the past 12 months.
In the meantime, Beneteau’s growth in motorboat sales have been running at a faster clip than its American competitor’s over the past 12 months, up 7% to €574m and accounting for 56% of its Boat Division revenues. The French builder’s sailboat business posted an even faster pace during the same period, with sales jumping 21% due to what it termed “dynamic trends” in the multihull segment and a more modest upturn in the monohull sailboat segment.
During the past 12 months, Beneteau has converted one facility to meet production demands for multihulls up to 40ft and established a new production unit for multihulls greater than 70ft. A new tooling unit was also set up for the fast-growing outboard boat sector.
Both Brunswick and Beneteau are anticipating an additional boost to already positive indicators for 2018, from replacement activity in the Caribbean and the US in the wake of hurricanes Harvey and Irma, which the American builder says generally can take up to 18 months to materialise based on its experience from previous hurricanes. Beneteau in particular has a leading position in the charter business with fleet revenues for 2016/17 reaching €78.5m – a 42% leap over the previous year. The French builder indicated in yesterday’s announcement that it is already seeing early order book growth from professional charter fleets in the affected regions.
Beneteau's geographic results also provide a good read on how the boat market has been developing around the world over the past 12 months. The group’s boat sales in Europe and North America both averaged approximately 7% annual growth (at constant exchange rates) during the financial year, while South American sales (excluding Brazil) surged more than 200%. Both Beneteau and Brunswick have shut down their manufacturing facilities in Brazil due to poor market conditions over the past two years, leaving only Azimut-Benetti with active production operations in the previously promising market.
Beneteau’s reported Asian revenues were down 5% for the year, attributing the regional results to fewer sales of larger boats in China, while revenues from the remainder of its worldwide markets (RoW) were up a strong 49%. The company also said it had a good season in its Housing Division based on an 8% lift in sales of leisure homes located at campsites and French holiday destinations after several strong seasons in this sector. Beneteau’s news in this business mirrors IBI’s own tracking of the fast-growing RV and towable caravan market, pointing to further evidence of healthy spending on big-ticket leisure items across Europe.
Beneteau’s comments on autumn boat show results reinforced an optimistic outlook for the industry, noting a positive atmosphere across European and American shows to date. The company stated its intention to sustain a high level of investment in new product introductions, industrial capacity and market development, particularly focused on North American brands and the large yacht segment in motorboats and multihulls.