Despite a fall in revenue Gigaset improves EBITDA

  • EBITDA from continuing operations in the third quarter: €3.8 million (Q3/2012: € –8.5 million[1]).
  • Consolidated revenue from continuing operations in the third quarter: €76.6 million (Q3/2012: €90.4 million).
  • Capital measures placed successfully. Proceeds of €42.9 million. Prospect of further funds.
  • Business Customers Business Unit almost doubles revenue compared with the third quarter of 2012.
  • CEO Charles Fränkl: “Market trends in our core business remain challenging, which underscores just how necessary the efficiency program is. We are making quick and good progress with implementing it. However, it’s also clear that we have to push ahead more intensively with the strategic restructuring we’ve initiated. We’ll also have to invest significantly in new business segments to enable us to grow again in future.”

Munich, November 11, 2013. As forecast, Gigaset AG was able to significantly improve its operating income (EBITDA) in continuing operations in the third quarter by €12.3 million to €3.8 million. That was attributable in particular to successful implementation of the cost-cutting and efficiency program launched in 2012. It has enabled costs to be reduced by €22.6 during the course of the year. The program is expected to unfold its full effect and produce savings of €30 million in 2014.

Due to the sharply declining market in the company’s core business and the revenue that was obtained in the second quarter and so earlier than usual as a result of the Sales Push Program, revenue from continuing operations fell to €76.6 million. The program became necessary in order to adapt cash inflow better to seasonal liquidity requirements in the summer months, when revenue is weak.

Despite the difficult market climate, Gigaset was again able to grow its market share in its core business. Its market share increased over the previous year by 2 percent both in terms of units sold and revenue. Gigaset’s market share in Europe in terms of revenue rose from 34 percent in the third quarter of 2012 to 35 percent in the third quarter of this year. That means Gigaset has outperformed the market for more than six quarters, is in its view a clear winner from the market’s consolidation and has further strengthened its market position in Europe. As a premium brand, Gigaset was also able to achieve prices that were 23 percent above the market average. However, the market as a whole remains under strong pressure. It declined year on year by around 15 percent in terms of units sold and by 17 percent in terms of revenue.[2]

Gigaset CEO Charles Fränkl commented on the quarterly figures: “Market trends in our core business remain challenging, which underscores just how necessary the efficiency program is. We are making quick and good progress with implementing it. However, it’s also clear that we have to push ahead more intensively with the strategic restructuring we’ve initiated. We’ll also have to invest significantly in new business segments in future.”

Together with Goldin Fund Pte. Ltd., the strategic investor that has now taken a stake in Gigaset, the company aims to penetrate the tablet and smartphone market. According to observers, the tablet market is three times larger and the smartphone market 15 times larger than that for DECT.[3] Unlike the market for cordless phones, the smartphone market grew by 14 percent, and the tablet market even surged by 60 percent, year on year in the third quarter 2013.[4] Gigaset will soon launch its first tablet computers.

Gigaset AG’s figures in the second quarter of 2013 (continuing operations)1:


  • Consolidated revenue: €76.6 million (Q3/2012: €90.4 million)
  • EBITDA: €3.8 million (Q3/2012: € –8.5 million)
  • EBITDA margin: 5.0 percent (Q3/2012: –9.4 percent)
  • Consolidated net loss: €3.8 million (Q3/2012: €13.3 million)
  • Free cash flow: € –9.9 million (Q3/2012: € –8.0 million)

The Gigaset Group’s cash and cash equivalents at September 30, 2013, were €17 million. The capital measures announced together with an investor agreement with Goldin Pte. Ltd. on September 27, 2013, have generated gross total proceeds of around €42.9 so far for Gigaset AG. On the basis of the investor agreement, the Gigaset Group has also held out the prospect of further funds to establish the new business segment for tablet computers, smartphones and other mobile end-user devices.

Rigorous implementation and further development of the “Gigaset 2015” strategy

The company is implementing the “Gigaset 2015” strategy rigorously and successfully.

Home Networks – “Gigaset elements”

After the safety starter kit of Gigaset elements, consisting of two intelligent DECT ULE-based sensors – the door sensor “door” and the motion sensor “motion” – as well as the base station “base” and an app for smartphones were shipped to selected customers back in July, sales via the wide-ranging network of specialty retailers and online began in Germany. The first step toward internationalization of the innovative smart home solution was taken with the launch of Gigaset elements in France in October. The distribution rate is now being expanded successively and sales underpinned by a marketing campaign.

Gigaset has added the window sensor “window” and the alarm siren “siren” to the portfolio for the system, which can be extended in a modular fashion. Additional components and extensive solutions in the fields of energy, climate and elderly care are planned in future. Gigaset elements defines a new market and goes beyond currently existing product categories. The safety starter kit addresses the issue of the sharp increase in the burglary rate in Germany. Gigaset elements offers a solution here that is easy to install, low-cost and so suitable for the mass market.

Consumer Products – “Gigaset”

Gigaset has continued the review of its non-European activities with the aim of focusing on highly profitable markets. The company continued its withdrawal from the unprofitable cordless phone business in Brazil. The subsidiary responsible for the Middle East and Africa region was sold to management there and merged with one of Gigaset’s large customers.

As part of its announced product drive, Gigaset launched four new models for various application areas in the third quarter, underscoring its role as the forerunner in DECT cordless telephony.

Rollout of the Android-based SL930A full-touch phone in Germany means customers can enjoy the benefits of a smartphone in addition to the convenience of fixed-network telephony. The Android 4.0 interface permits quick and easy access to the Google Play Store directly via the router. More than 975,000 apps are available from Google Play. The SL930A is the first step toward new and highly promising cloud-friendly products. The range of Android-based systems will soon be expanded.

Rollout of the first products from the “adjacent products” segment was prepared by communication measures. Three baby phone variants in three different price categories were presented as part of an Internet campaign. With its new models, Gigaset offers high-quality baby phones for every need and is applying its experience and expertise in integrating baby phones in telephones to the field of standalone systems for the first time.

The consumer portal “” awarded Gigaset the title “Premium Manufacturer 2012” in the category “Telephones” as part of a large-scale study at the start of the third quarter. The title “Premium Manufacturer” is only bestowed on companies with the very highest standards of quality and whose products are tested regularly in trade publications and fare above-average. Gigaset has now been awarded the “Premium” seal of quality in the “Telephones” category for its constant and high-class achievements in the past years.

Business Customers – “Gigaset pro”

The Business Customer Business Unit with the Gigaset pro brand has further established itself on the market in the third quarter. Revenue was grown further and almost doubled year on year thanks to a portfolio tailored to specific target groups and selective sales and marketing measures.

The range of products and services was also developed further in the third quarter. Gigaset pro and AudioCodes have jointly created a solution that enables Gigaset pro N720IP DECT multicell telephone systems to be used in Microsoft Lync environments. It supports a wide range of features for communication at enterprises. This solution now means that cordless calls are possible anytime, anywhere – at the company and throughout its campus – in Lync installations as well.

In September, the R630H pro was launched, a new business phone whose ruggedness makes it suitable for companies with employees who work outside traditional office rooms. The R630H is certified in accordance with protection class IP65, i.e. is particularly dust- and splash-proof and has the additional advantage of impact resistance.

In France, Gigaset pro was voted the best manufacturer of SIP-based end-user devices in a survey of resellers.

Outlook confirmed

Gigaset AG sticks to the outlook it gave at its annual press conference on March 28, 2013. The measures required to ensure long-term growth were initiated in 2012. To counter the continuing difficulties in the company’s core market, investments in establishing new, promising business segments and product groups are required. Gigaset AG therefore expects from continuing operations in the current fiscal year:


  • A further decline in revenue in its core business in a high single-digit to low double-digit percentage range.
  • EDITBA to improve sharply year on year and presumably to be positive again thanks to the positive impact expected from the efficiency program
  • A negative free cash flow in around the middle double-digit million range due to the investments required

For 2014, Gigaset AG expects initial and significantly positive effects on revenue, earnings and cash flow from establishment of the new business segments. The company therefore assumes that its revenue from continuing operations will grow and its EBITDA will improve further in the course of 2014.

Gigaset AG, Munich, is an internationally operating company in the area of communications technology. The Company is Europe's market leader in DECT telephones. The premium supplier ranks second worldwide with around 1,400 employees and a market presence in around 70 countries.

Gigaset AG is listed on the Prime Standard of Deutsche Börse and so is subject to the very highest requirements for transparency. Its shares are traded on the Frankfurt Stock Exchange under the symbol 'GGS' (ISIN: DE0005156004). DE0005156004.


Gigaset AG

Stefan Zuber, Corporate Communications      Kerstin Diebenbusch, Investor Relations

Phone: +49 (0)89 444456-866                                  Phone: +49 (0)89 444456-937

E-mail: info.presse(at)                    E-mail: info(at)

Overview of the figures:

June 1 – September 30, 2013

June 1 – September 30, 2012[5]

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September 30, 2013

December 12, 2012

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[1] The figures for 2012 have been adjusted due to the change in IAS 19. Details can be found in the notes to the consolidated financial statements in the report on the third quarter of 2013.

[2] The data is taken from surveys by the Retail Panel for Cordless Phones of GfK Retail and Technology GmbH in Belgium, Germany, France, the UK, Italy, the Netherlands, Austria, Poland, Switzerland, Spain and Russia. Survey period: January to September 2013; base: GfK Panel Market. [3] Source: MZA

[4] Source: IDC: Units in Q2 2013 versus Q2 2012

[5] The figures for 2012 have been adjusted due to the change in IAS 19. Details can be found in the notes to the consolidated financial statements in the report on the third quarter of 2013.

[6] Before capital measures

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