28 April 2020
Author: Ron van der Ploeg
AALSMEER, Netherlands: Dutch auction house Royal FloraHolland reports a turnover of €4.8 billion in flower and plant sales for 2019, an increase of 3.1 per cent over the previous year.
More than 12.3 billion plants and flowers (+1.5% over 2018) changed hands in 2019 at Royal FloraHolland’s four marketplaces: Aalsmeer, Naaldwijk, Rijnsburg and Eelde.
Turnover increased by 3.1% to € 4.8 billion with higher median prices for plants and flowers and higher supply volumes contributing to the increase of turnover. Turnover in cut flowers, potted plants and garden plants increased 3 per cent, 3.4 per cent and 2.6 per cent respectively.
Operating profit amounted to € 5.6 million thanks to lower expenses. This calculation reflects the annual report 2019 published on 23 April 2020.
In 2019, the share of clock sales at the world’s famous hub for flower trade was 40.7 per cent.
Royal FloraHolland is a cooperative with 5,406 suppliers and 2,458 customers.
Commenting on the tumultuous events of the past five weeks auction boss Steven van Schilfgaarde says, “Over the past five weeks the sector has been hit very hard. I am confident that thanks to the government’s bail-out package of €600 million, the sector will be able to get through this difficult period. At the time of the coronavirus outbreak, we were in good shape. I am confident that our sector is resilient. As soon as international demand recovers, we should be able to react immediately. We currently see some bright spots, but there is still a long way to go. We are accelerating the implementation of our strategy. We are fully committed to digitisation, with all transactions in the market taking place digitally by the end of the year and will continue even faster to prepare for the roll-out of “Landelijk Veilen” (nation-wide auction) in 2021. These projects are preconditions for bringing our costs structurally down to a lower level.”
In response to sharply declining international demand, Royal FloraHolland has introduced a temporary supply regulation for the clock and made agreements with banks on the provision of emergency loans to members.
In addition, immediate action to safeguard its business operations, in the interests of growers and buyers.
Royal FloraHolland’s solid starting position ensures that, despite an expected substantial loss for 2020, no acute financial problems will arise. Part of the existing financing capacity is being used. CFO David van Mechelen notes, “We are well-financed and maintain close contact with our banks. We also appeal to government support measures. Continuity of the cooperative and preservation of employment is of paramount importance to us. The money we borrow under our credit facility we must redeem in the future. We will have to reduce our costs and adapt our business activities to the changes and new levels. Last year we reduced our costs. This year we will continue to do so, with even greater urgency. Investments in strategic programmes will increase our efficiency and accelerate the development of new business models and strengthen our market position”.
The annual report shows that the financial ratios are at the same level, with 28.8 per cent for solvency and 60.3 per cent for venture capital. Operating profit (EBITDA) was €90 million in 2019.