Reply To: Where do you see B&O in 5-10 years?

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Home Forums General Discussion & Questions Where do you see B&O in 5-10 years? Reply To: Where do you see B&O in 5-10 years?

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    So B&O just showed their Q3 result, and even though there is a small loss, they show that they can handle the high extra expense  on freight and components.

    Here is some parts of the report that I find interesting:

    As a result of steady progress on strategy execution
    the company grew revenue by 10% in local
    currencies in Q3. This was the seventh consecutive
    quarter with double-digit growth.

    Earnings for the period were a loss of DKK 16m
    compared to a profit of DKK 13m last year.
    Free cash flow was an outflow of DKK 14m (Q3
    20/21: inflow of DKK 8m). The year-on-year decline
    was related to higher component costs and higher
    Available liquidity was stable at DKK 511m (Q2
    21/22: DKK 534m)

    The two core Asian markets grew by 28% in local
    currencies. Sell-out was at the same level as last
    year. Sell-out growth was lower than sell-in in the
    multibrand and etail channels as the company
    transitions to new distribution partners. Also, the
    Chinese New Year began earlier this year, thereby
    impacting the number of sell-out days in Q3.

    Americas grew 32% in local currencies, driven by all
    product categories and distribution channels. Likefor-like sell-out grew by 18%.

    Year-to-date, the customer base grew by 25%. The
    company saw a 32% growth in customers owning
    two or more B&O products, partly driven by
    retargeting of existing customers

    The company maintains the outlook for the financial
    year 2021/22, but due to higher component costs,
    the company now expects EBIT margin before
    special items and free cash flow to be in the low end
    of the range

    Revenue from speaker sales more than doubled
    compared to Q3 of last year. This increase was
    driven by all products, especially Beolab 28, which
    was launched in Q4 of last year and continued to
    see strong demand.

    Revenue from TVs was slightly lower than Q3 of last
    year. However, last year, the company sourced and
    sold TV screens supporting the launch of Beovision
    Contour 48’’. This accounted for around 6% of
    revenue within the Staged category last year and if
    this is excluded, TV sales delivered high single-digit

    Cash flows from investing activities were an outflow
    of DKK 75m (Q3 20/21: outflow of DKK 55m).
    Investments were primarily related to the product
    roadmap and continued development of product
    platforms. Investments in tangible assets increased
    following investments in retail development and the
    company’s aluminium factory.

    n Q2 2021/22, the building “the Farm” was
    reclassified to land and buildings under tangible
    assets because it will be used for own purposes.

    Model for scale
    Another critical part of creating business robustness
    is to build a scalable business model. This means
    essentially creating a systemic mix of attractive
    propositions, sold through the right marketing and
    distribution channel mix, so that the business can
    grow organically.

    The company’s Recreated Classics initiative was
    further expanded with the launch of BeoSystem 72-
    22. This system was created exclusively for the US
    and Canada and only 30 units were made of this
    limited-edition system which were all sold within the
    first day

    Another product programme is the Bespoke
    programme launched in Q2. Throughout Q3, the
    company experienced a consistent inflow of
    product requests without significant marketing
    activation. The vast majority of bespoke requests
    year-to-date (95%) were customisations, where
    customers mix and match existing colours, materials
    or finishes for a specific product. The remaining 5%
    were bespoke orders, where products are tailored
    exclusively to the individual customer. The
    programme is a deliberate effort to increase
    relevancy and attractiveness towards specific
    subsegments of the company’s target audience in
    the Very High Net Worth Individuals and WellEstablished customer segments

    In Q3, the company launched a limited-edition
    Beosound A1 speaker in partnership with the
    streetwear label and lifestyle brand CLOT. The
    collaboration was designed to tap into CLOT’s
    creative movement in bridging Eastern and Western
    cultures in order to drive awareness and affinity
    with a younger segment of, particularly, Chinese

    The company’s strategic decision to win in London
    continued to yield strong results. UK performance in
    the quarter was testament to the positive impact of
    this approach, with year-on-year revenue growing
    11% and sell-out growth reaching 31%. For London
    specifically, sell-out growth in company owned
    stores reached 80%, outperforming both the rest of
    the UK and the EMEA region. In addition, brand
    awareness, customer base and repurchase increased
    significantly compared to last year.

    Brand Partnering activity remains a critical
    component of the business model as it drives
    awareness and new customer acquisition.
    Performance in the quarter grew by 9%, primarily as
    a result of aluminium sales related to Harman’s
    addition of the Genesis car brand.

    The launch of 1+ product innovation in Q4.