As a result of stable growth in most locations and improved performance in specific businesses positively impacted by Brazilian and Russian travelers, organic growth continued to accelerate to 7.2% in the first quarter of 2017 (5.6% in Q4 2016), with like-for-like growth accounting for the whole increase.
Supported by synergies from the World Duty Free (WDF) acquisition, gross profit margin further improved to 59.6%. EBITDA increased to CHF 154.7 million, while EBITDA margin expanded by 10 basis points to 9.1%.
Dufry continued to focus on accelerating business development. In the year to March, the company had refurbished 7,200 sqm and plans to refurbish 19,500 sqm more in 2017. It also added 5,600 sqm of gross new retail space and has signed contracts for opening a further 23,000 sqm in 2017/18.
The Americas turned in solid performances.
Turnover reached CHF 400.2 million in Q1 2017 from CHF 351.8 million one year earlier and organic growth reached 12.7%. In Central America, all main operations performed very well, including Mexico, Puerto Rico, Dominican Republic and the cruise business.
In South America, all operations also did well, with Brazil, Uruguay, Peru and Chile growing double digits, while Argentina and Ecuador grew single digits.
Turnover reached CHF 392.1 million compared to CHF 367.3 million in the first quarter of 2016. Organic growth reached 4.8%, as a result of solid performance in the United States and Canada, in both duty free and duty-paid businesses.
Julian Diaz, CEO of Dufry Group, commented: “I am very confident with the good start we had in 2017. The efforts we have put and the measures we have implemented to recover organic growth are finally showing a significant impact in the sales performance, together with better economic and political conditions in several markets.
“After turning positive in the third quarter of 2016 with a +1.3% organic growth, we posted +5.6% organic growth in Q4, and now report a good start into 2017 with organic growth accelerating to 7.2%,” he said.
Diaz added that Dufry expects to see the WDF synergies fully reflected in the P&L by the end of 2017, and that cash generation and deleveraging remain the most important targets in 2017.
“With respect to organic growth we will continue to both drive expansion of retail space as well as implement further initiatives to increase spend per passenger,” he concluded.