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UPDATE 1-Amplifon sounds out Brazil, emerging markets for deals
January 30, 2014 / 5:00 PM / 4 years ago

UPDATE 1-Amplifon sounds out Brazil, emerging markets for deals

* Expect news on Brazil deal this year - CEO

* Amplifon has war chest of 200-250 mln euros

* Q4 better than expectations (Adds further comments by CEO, background)

By Stephen Jewkes

MILAN, Jan 30 (Reuters) - Italian hearing aids firm Amplifon is looking to seal acquisitions in Brazil and other emerging markets this year as it looks to continue expanding abroad, its chief executive said on Thursday.

“You can expect news this year,” Franco Moscetti told reporters at a business lunch.

Amplifon, whose core market in Italy accounts for around 24 percent of group revenues, is currently present in 20 countries and says it has a 9 percent share of the global market.

But emerging markets account for less than 1 percent of its turnover and the group is keen to make acquisitions in markets like Brazil and China.

“Brazil has 180 million people, a good growth rate, lots of room for private sector development and a high penetration of hearing devices,” Moscetti said.

Amplifon, which posted sales of 847 million euros in 2012, estimates more than 650 million people worldwide suffer with some degree of hearing impairment.

However, the company also remains focused on its core markets in Europe, Moscetti said, and in fragmented national markets like France and Germany it needed to grow in size to improve its performance.

“We are looking at targets in Germany,” he said.

The company now has a war chest of around 200-250 million euros for potential acquisitions, Moscetti said, adding it was ready to tap the market for more resources if necessary.

In 2010 Amplifon spent A$460 million ($403 million) buying Australian audiology service provider NHC Group Pty Ltd and since then has consolidated its financial position and rescheduled its debts so that it has none due for repayment before 2018.

Moscetti also said Amplifon’s results for the last three months were ”very good“ and ”better than expectations“ while the current year had ”not started badly.

Growth in the United States and the Asia Pacific region remained robust in the final quarter of last year and there was an improvement in Europe with the exception of the Netherlands, he said.

Some analysts have worried that the quarter’s results could be weak due to the impact of reforms in the Dutch hearing aid market and earlier this month French rival Audika reported weak sales for 2013.

A consensus market forecast provided by the company predicts the company’s revenues in 2013 were 826 million euros and earnings before interest, tax, depreciation and amortisation (EBITDA) were 115 million euros. In 2012 its EBITDA was 145.2 million euros on revenue of 847 million euros, according to Thomson Reuters data. ($1=1.1416 Australian dollars) (Reporting by Stephen Jewkes; Editing by Greg Mahlich)

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