PBS - Holding ag

Interview: PBS Holding planning acquisitions

 

Andy Braithwaite, 29 June 2018

Richard Scharmann, Managing Director of European multichannel office products player PBS Holding, tells OPI he expects to make acquisitions in 2019.

Richard Scharmann, Managing Director of European multichannel office products player PBS Holding tells OPI he expects to make acquisitions in 2019.

OPI caught up with Scharmann at the OPI European Forum in London earlier this month to talk about PBS Holding’s performance in 2017 and what’s in store for the group which operates in seven European markets.

First off, Scharmann described 2017 as a “reasonable” year for the company. Sales were up by 1.5% to €253 million ($295 million), a result that was largely impacted by a 6% fall in the group’s largest market. The reason for this decline in Germany? Scharmann says it was due to PBS not wanting to get dragged into a price war as a competitor that was experiencing service issues (he didn’t identify the competitor by name, but we can safely assume it was ADVEO) tried to win back share on price.

„We are heavily focused on our profitability and there is a certain ‘red line’ that we won’t cross,“ he said.

Anyway, the situation appears to have been a temporary one: sales at the Alka wholesaling unit in Germany to the end of May 2018 were up 30% year on year as customers come back to the PBS-owned distributor. “When service levels are so bad, even slashing prices doesn’t convince anyone,” said Scharmann.

That sales jump at Alka helped PBS’s top-line to be 7% ahead of the 2017 figure for the first five months of this year. About two-thirds of that was organic growth as markets such as Poland and the Czech Republic increased in the double-digits, while Germany, Slovakia and Austria all grew in the mid-single digits.

The remaining one-third was down to the acquisition of southern Austrian reseller Strein that was completed on 1 October last year. Scharmann said the integration of that business was now complete and that Strein’s strength in facility supplies was a “good fit” for PBS as it continues to diversify its product offering.

Turning to PBS Holding’s strategic development, we couldn’t help but ask Scharmann if he would be interested in acquiring ADVEO should that business become available – the Spain-based wholesaler’s ongoing issues have been well-documented in OPI in recent months.

It didn’t appear to be a course of action that excited Scharmann too much, citing structural complexities and a different management approach.

We’ve made 15 acquisitions in the past ten years, and all have them have been a good fit for us,” he said.

However, he also noted that PBS remains flexible and will look at opportunities as and when they arise, either in the wholesaling or reseller channels. It would appear that Benelux and southern European markets such at Italy would make the most sense in terms of geographical expansion for PBS, but Scharmann didn’t confirm this.

What he did confirm, though, is that we can expect PBS to make acquisitions in the coming 12 months, either in existing geographies or new markets. By next year, the group will have paid off all of its long-term debt and will be in a strong position to plot the next stage in its strategic development.

We are looking at some possibilities,” he said. “These things usually take 6-12 months to come to fruition, so we will just have to wait and see.

 

Quelle: OPI