Consumer business

The table below shows the results compared with the corresponding period of 2013:

CONSUMER
(in millions of euro)
1Q 2Q 3Q 4Q TOTAL 
 2O142O132O142O132O142O132O142O132O142O13
Net sales 1,128.7 1,116.7 1,159.6 1,138.7 1,178.0 1,123.2 1,144.0 1,100.3 4,610.3 4,478.9
yoy 1.1%   1.8%   4.9%   4.0%   2.9%  
Gross operating margin before restructuring expenses 219.4 194.8 245.1 203.5 228 211.9 242.2 229.4 934.7 839.6
% of net sales 19.4% 17.4% 21.1% 17.9% 19.4% 18.9% 21.2% 20.8% 20.3% 18.7%
Operating income (loss) before restructuring expenses 162.7 138.0 186.8 146.7 167.3 155.3 180.4 172.2 697.2 612.2
% of net sales 14.4% 12.4% 16.1% 12.9% 14.2% 13.8% 15.8% 15.7% 15.1% 13.7%
Restructuring expenses (3.9) (2.0) (5.5) (2.5) (3.1) (4.1) (8.3) (7.2) (20.8) (15.8)
Operating income (loss) 158.8 136 181.3 144.2 164.2 151.2 172.1 165 676.4 596.4
% of net sales 14.1% 12.2% 15.6% 12.7% 13.9% 13.5% 15.0% 15.0% 14.7% 13.3%
 

The table below provides a detailed breakdown of the market trend:

  1 Q2 Q1st half 2O143 Q9 months 2O144 QTotal year
EUROPE (*) Original Equipment +9% +3% +6% +2% +5% +2% +4%
  Replacement +9% +6% +7% +1% +5% -8% +2%
NAFTA Original Equipment +4% +3% +4% +7% +5% +4% +5%
  Replacement +2% +5% +3% +3% +3% +2% +3%
SOUTH AMERICA Original Equipment -11% -25% -19% -19% -19% -9% -17%
  Replacement +4% +3% +4% +4% +4% +7% +5%
CHINA Original Equipment +10% +12% +11% +6% +10% +9% +10%

(*) including Turkey; excluding Russia

Net sales totalled euro 4,610.3 million, showing an organic growth of 8.9% (+2.9% including the impact of exchange rates) thanks to the following factors:

  • the positive contribution of the volumes component +5.0% (+8.4% in mature markets, +3.7% in emerging markets, which were affected by the contracting in the Original Equipment market in South America -17%), higher than the market growth;
  • the improvement of the price/mix (+3.9%) mainly due to the increasing weight of the Premium (55.0% of Consumer revenues in 2014 compared to 50.8% in 2013) and the increasing weight of sales in Europe and North America.

Premium revenues amounted to euro 2,536.0 million, a growth of 11.5% in total over the previous year (+13.2% excluding foreign exchange impact). This business segment recorded sustained growth in sales in all markets compared to 2013; in particular, the trend of strong business development in Europe (+8.1%), in Apac (+28.3%), Middle East, Africa (+17.6%) and Russia (+37.5%) is worth mentioning.

Below is the breakdown of the change in sales:

 1 Q 2 Q 3 Q 4 Q Cumulative at 12/31
 2014201320142013201420132014201320142013
Volume 5.9% 1.2% 4.3% 4.6% 5.3% 6.0% 4.5% 6.9% 5.0% 4.6%
of which Premium volume 22.2% 4.0% 20.9% 12.9% 17.3% 19.1% 10.7% 27.5% 17.8% 15.3%
Price/mix 4.4% -0.5% 5.8% 5.7% 3.1% 3.1% 2.5% 5.1% 3.9% 3.2%
Change on a like-for-like basis 10.3% 0.7% 10.1% 10.3% 8.4% 9.1% 7.0% 12.0% 8.9% 7.8%
Translation effect -9.2% -3.7% -8.3% -4.7% -3.5% -8.5% -3.0% -9.4% -6.0% -6.5%
Total change 1.1% -3.0% 1.8% 5.6% 4.9% 0.6% 4.0% 2.6% 2.9% 1.3%

Operating income before restructuring costs reached euro 697.2 million, with a margin of 15.1% compared to euro 612.2 million in 2013 (13.7% of sales). Operating income amounted to euro 676.4 million (with a margin of 14.7%), an increase of euro 80.0 million compared to euro 596.4 million in 2013 (13.3% margin).

The increase in profitability reflects:

  • the improvement of the price/mix, thanks to the growing weight of Premium in all region, and to a greater weight of the Replacement channel;
  • the growth in the volumes;
  • the progressive achievement of internal efficiencies, the lower impact of start-up costs and better use of production capacity.