Other Europe

in millions of EUR
(unless stated otherwise)

2014

2013

Change versus
prior year

Growth at constant currency

Organic growth

Growth from acquisitions

Revenue

732

694

5.4%

7.3%

6.1%

1.2%

Comparable growth (%)

4.1%

3.3%

80bps

Adjusted EBITDA

114

92

23.7%

26.3%

25.0%

1.3%

Adjusted EBITDA margin (%)

15.6%

13.3%

232bps

Number of stores (#)

1,660

1,412

17.6%

Number of employees (average FTE)

7,415

6,312

17.5%

Other Europe consists of the business units that operate in the Nordics, Eastern Europe and Southern Europe. These business units manage single or multiple optical retail banners in one or several countries. The banners are predominantly comprised of own stores and, to a lesser extent, franchise stores. Most banners have leading positions in their respective markets. At the end of 2014, there were 1,660 stores in the Other Europe segment.

The Other Europe businesses and markets are characterized by a lower level of maturity than the G4, especially in the Southern and Eastern European countries. GrandVision has been developing growth opportunities in this segment through gaining scale in these markets via expansion of its existing store base as well as through acquisitions.

Revenue

Revenue increased by 5.4% to €732 million in 2014, of which -1.9% was the impact from exchange rates, in particular from the Norwegian and Swedish krone against the euro. Therefore, at constant currencies revenue growth stood at 7.3%. Excluding the impact from acquisitions, organic revenue growth was 6.1%. Comparable growth was the main contributor to organic revenue growth in 2014 and came in at 4.1%, led by Northern Europe and Eastern Europe. Store expansion also contributed to total revenue growth. Acquisitions grew revenue by 1.2% in Other Europe in 2014, mainly from a number of individual store acquisitions. The acquisition in Italy of Angelo Randazzo occurred at the end of December and therefore did not materially impact 2014 revenue.

In total, the number of stores in Other Europe increased from 1,412 to 1,660 at year-end 2014, mainly as a result of the acquisition in Italy at year-end and organic store expansion in Portugal, Italy and Finland.

Adjusted EBITDA

Adjusted EBITDA in Other Europe increased by 26.3% at constant exchange rates and 25.0% organically to €114 million. The increase primarily reflects the comparable growth developments in Northern and Eastern Europe, where sales increased and operating expenses were kept under control. In Southern Europe market conditions were not as favorable and the key sunglasses markets experienced a relatively poor summer. Despite lower growth, the EBITDA and EBITDA margins also improved in these countries as a result of better scale and cost control. Acquisitions of a number of individual stores in Other Europe had a positive impact on adjusted EBITDA growth of 1.3%. The acquisition in Italy of Angelo Randazzo occurred at year end 2014 and therefore did not have a material impact on the results of the region. In total, the adjusted EBITDA margin increased to 15.6% in 2014 from 13.3% in 2013.