Dufry nine-month and third-quarter results show “strong and resilient” growth, with 9mo turnover hitting CHF 9,578.9 million, up 24.8% year-on-year on an organic basis.
Dufry – which is set to be renamed Avolta at a shareholder meeting tomorrow – reported nine-month EBITDA of CHF 893.5m, with a 9.5% margin.
Third-quarter EBITDA was running at an even higher margin, hitting 11% at CHF 305.0m. Turnover for the period stood at CHF 3,668.1m, representing 16% organic growth.
Dufry said its Autogrill integration was “advancing successfully”, with in-year CHF 30m synergies already achieved.
Progress is said to be “earlier than expected” for the business combination. Synergies are forecast to hit CHF 85m with full run-rate in 2024.
The retailer added that it was continuing to deliver on its Destination 2027 strategy, with a number of combined retail and F&B concepts already launched.
Looking ahead, Dufry said its fourth quarter had “started equally strong” with “resilient demand” for travel retail.
The Board of Directors is proposing full-year dividends of CHF 0.70 per share.
Dufry nine-month regional highlights
Dufry’s Europe, Middle East and Africa region accounted for CHF 4,747.1m turnover for the nine-months to date (+23%). For the third quarter, sales stood at CHF 2,089.4m (+12%).
According to the retailer, the “healthy” performance was driven by leisure demand. Best performing destinations included the Mediterranean, with the UK, Nordics and Central Europe benefiting from increased international travel.
North America’s turnover stood at CHF 2,946.4m (+16.8%), with the third quarter weighing in at CHF 1,081.3m (+11%).
In the US, growth came from both travel retail and F&B, while Canada benefited from the return of travellers from Asia.
Across Latin America, nine-month turnover reached CHF 1,198.4m (+34%) and CHF 421.9m (+27%) for the third quarter.
Argentina, Mexico and the Caribbean were called out as top performers, while Brazil continued to “recover well”. Dufry also noted its cruise line business in the region “progressed”.
Asia Pacific saw a “significant improvement” from last year’s low base. Nine-month sales soared by 110% to CHF 419.6m, while the third quarter showed 44% gains to CHF 134.8m.
Growth came from domestic and intra-regional travel, as well as “gradually returning” international travel.
While Chinese outbound travel continued to be negatively impacted, demand from other markets became “increasingly evident”.
The ‘broadest’ portfolio in the industry
Dufry Group CEO Xavier Rossinyol acknowledged that the nine-month report would be the final one under the company’s current name.
Once approved, the Avolta name will see the business become “more than the sum of its parts,” he said.
“The delivery of Q3 and 9M 2023 figures driven by robust demand, strong execution and the broadest portfolio in the industry, paired with continued cost management and earlier synergy implementation, openly demonstrates the resilience of our combined company,” Rossinyol continued.
“We have successfully advanced on the integration, with our rebranding to Avolta as the final step, generating full run-rate synergies of CHF 85 million already as of 2024, one year ahead of plan.
“Should our current performance continue through the last quarter, we project a full year 2023 organic growth of around 20% versus the previous year turnover for the proforma combined business of CHF 10,805 million.”
He added: “Based on this, FY 2023 reported growth is expected to be around 15% versus the previous year for the proforma combined business.”
On the broader strategy, he said: “While our Destination 2027 strategy has the traveller at its core, it is completely powered by our people.
“We thank our employees all around the world for their exceptional motivation, dedication, and most importantly, their delivery.”
Xavier Rossinyol spoke candidly to TRBusiness last month about the birth of Avolta, the new brand identity set to be rolled out. Click above to watch part 1 in a two-part exclusive video interview.