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Bang & Olufsen cuts outlook as Europe sales weaken

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(Globalpost/GlobalPost)

COPENHAGEN (Reuters) - Danish luxury stereo and television maker Bang & Olufsen <BO.CO> cut its outlook for the 2012/13 financial year as the crisis in Europe hurt revenue and the cost of a turnaround plan weighed on results.

The cut in outlook is the company's second since the start of the year, as the luxury goods sector struggles with Europe's long-running debt crisis and strong demand from emerging markets has failed to offset all of the pain.

B&O has also been hit by a revamp of its distribution network in Brazil and China, two of its most promising markets.

The company said in a statement on Friday it now saw revenue for the 2012/13 financial year in a range from 2.80 billion Danish crowns (319.9 million pounds) to 2.90 billion Danish crowns. It previously expected it to exceed 3.00 billion Danish crowns.

It also cut its earnings before interest and tax (EBIT) outlook to a loss in the range of 150 million to 200 million Danish crowns, having previously forecasted a positive EBIT.

The EBIT guidance included an expected hit of more than 100 million crowns from higher amortisation and lower capitalisation, B&O said.

The company said it would incur non-recurring costs of 40 million crowns during the financial year, mainly relating to organisational changes and network restructuring.

In January, its second-quarter pre-tax profit landed well below analysts' forecasts, sending the shares down as much as 13 percent.

(Reporting by Copenhagen Newsroom; Editing by Helen Massy-Beresford)

http://www.globalpost.com/dispatch/news/thomson-reuters/130322/bang-olufsen-cuts-outlook-europe-sales-weaken