Dufry’s turnover up by 51% in 2006

Emily Pacey

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Dufry Group’s acquisition of Brasif Duty Free drove a surge in sales, profits and turnover in 2006

Last year Dufry’s turnover increased by 51% to reach SFr1.4bn ($1.2bn) compared with 2005. The main driver behind this growth was acquisitions – particularly Brasif Duty Free - which drove 33% of the increase. Gross profit rose by 57.6% to reach 744.4m ($615.2m) in 2006.

In Europe, sales were up by 13%, reaching SFr370.2m ($306m) compared with the previous year. Dufry’s main market in this region is Italy, which grew by 14.7%. New operations in Spain - at Tenerife, Mallorca and Bilbao airports - also contributed to the region’s sales growth.

Asia and Russia generated sales of SFr187.2m ($154.7m), up by 24.4% compared with 2005. The company attributed most of this increase to the strong performance of its Moscow business, as well as new shops at Singapore Changi airport and Sharjah airport, where two new shops and the refurbishment of the main shops boosted sales. New operations at Belgrade airport also helped to boost sales in the region.

Sales in the US and Caribbean increased by 17% to reach SFr328m ($271m) in 2006 compared with 2005. These figures exclude the company’s cruiseline retail operations and its Bolivian operation, which was redefined by the company as belonging to its new South America division. New operations in the Dominican Republic, which began in 2005, and in Turks & Caicos, opened in 2006, helped to boost sales in the region, as did the full year consolidation of jewellery company the Young Caribbean Group, which Dufry acquired in the last quarter of 2005. The company said that its recent acquisition of Alliance Duty Free, which operates 23 stores in Puerto Rico, will be fully consolidated in 2007.

 Dufry increased its sales in Africa by 14.4% to reach 146.4m ($121m) in 2006. The company said its stores at Marrakech Menara airport performed particularly well. Dufry’s two new shops at Algiers Houari Boumédienne International airport also added to growth in the region, as did its new contract to start operating at Sharm-El Sheik airport later this year.

Dufry Group CEO Julián Díaz said: “Dufry’s performance in 2006 was impressive and we actively drove the development in all areas. As set out in our strategy, we continued to improve our existing operations through organic growth and refurbishments, and at the same time expanded our concession portfolio through concession wins and acquisitions, namely in Brazil and, in late December 2006, in Puerto Rico. Furthermore, the successful IPO of Dufry South America Ltd was also an important event for us and illustrates our focus on adding value to our shareholders. In our view, Dufry’s has made a quantum leap in the last years and we are now creating the basis for an even stronger position of Dufry in the future.”

 The company denied that the new security measures introduced last November have not had a “material impact” on its performance, partly due to the company’s broad international base. However, Dufry said that it supports the ETRC’s iniative to harmonise security measures.

 Dufry also announced the launch in 2007 of some logistics and IT improvement projects, which it said in a statement would “increase the efficiency of [our] processes. These projects should allow Dufry to continue to drive organic growth and profitability".