Quarterly Report • Oct 18, 2018
Quarterly Report
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Q3
Interim report January–September 2018 VD-ord
The third quarter of the year was a very challenging quarter for Nederman in several ways. In the USA, we were affected by production and distribution disruption at and around our production facilities which are all located in North and South Carolina where Tropical Storm Florence caused devastation.
In APAC, Nederman had problems of other kinds during the quarter. In China, the caution we could already see in the second quarter increased. Nederman's customers have had difficulty finding financing for larger projects, which has resulted in a weak order intake in the quarter. The economic situation in China has also meant that our customers are deferring their payments longer than before. Rapidly rising commodity prices have also put pressure on the Group's profitability in the region.
EMEA had stable development in the quarter with organic growth of the order intake of 3.5 percent and sales of SEK 410.5 million (376.1).
All in all, the many challenges during the quarter, together with challenging comparative figures from the very strong third quarter of 2017, meant that the order intake decreased organically by 5.6 percent. However, the acquisitions of NEO Monitors and Auburn Filter Sense have had a very positive impact on the Group's development, which means that total orders received increased by 7.5 percent to SEK 817.9 million (761.0).
Despite the challenges in the third quarter, there are several bright spots in our business operations. Nederman Insight, which was established in 2017, is developing faster than we originally anticipated, and both NEO Monitors and Auburn FilterSense are providing significant positive contributions to our business. It is clear that our customers have a great need to establish, with the help of Nederman Insight, a digital and online business with all the benefits this provides. Nederman Insight as a whole is now approaching an annualised order intake equivalent to SEK 250 million. Although Nederman Insight already forms a significant part of the Nederman Group, we are still only at the beginning of the journey aimed at establishing Nederman as the obvious digital partner for our customers.
On October 1, it was announced that the NAFTA Trade Agreement between the USA, Mexico and Canada is being replaced by a new trade agreement, USMCA. Hopefully, this new agreement will mean that some of the uncertainty that has characterised trade between the United States, Mexico and Canada will gradually decrease.
During the last quarter of the year, we will continue the work of managing our ambivalent world in the best possible way and building on the lessons learned in the third quarter.
Sven Kristensson
CEO
In the Americas, orders received in the quarter declined organically by 15.3 percent to SEK 309.7m (322.7). Sales decreased organically by 6.0 percent to SEK 307.0m (287.1). The adjusted operating result was SEK 26.1m (31.5), corresponding to an adjusted operating margin of 8.5 percent (11.0). Mexico and Brazil had strong sales in the quarter while developments the USA and Canada were weaker.
There continues to be uncertainty concerning US trade, health and environmental policies. The effects of US customs on steel and aluminium as well as on goods from China are now beginning to impact on the US economy. The NAFTA agreement has been replaced by the USMCA agreement, which probably means that the previous uncertainty surrounding NAFTA will gradually decrease. In the long term, economic development is expected to be boosted in Brazil, which, together with the authorities' more stringent requirements for compliance with the country's environmental legislation, is expected to have a positive impact for Nederman's products and solutions.
In the USA, order intake declined organically by 17 percent and sales fell by 6 percent following a weaker sales trend for large systems. The development should be seen in the context of a very strong third quarter in 2017 when two major orders were booked. Aftermarket business showed a strong performance in the quarter. At the end of September, Tropical Storm Florence resulted in major disruption at and around the Group's production and distribution facilities, which had a significant negative impact on sales and profitability in the quarter.
In Canada, order intake declined organically following a weaker sales trend for smaller systems. The aftermarket grew by 16 percent compared to the corresponding quarter of 2017.
Brazil had both strong incoming orders and sales in the quarter. The metal industry in the country is still showing low
Weak development in the USA and Canada. Good sales of major projects in Mexico. Strong development in Brazil.
demand, which is partly offset by growing demand from the food, pharmaceutical and chemical industries. Profitability has been boosted in the quarter.
Mexico continued to post strong growth in the quarter following good sales of larger projects. The development of core business was in line with expectations.
Incoming orders during the quarter amounted to SEK 309.7m. Organically, this corresponds to a decrease of 15.3 percent compared with the same quarter of 2017. Incoming orders for the period January - September amounted to SEK 932.6m. Organically, this corresponds to a decrease of 0.3 percent compared with 2017. Net sales during the quarter totalled SEK 307.0m. Organically, this corresponds to a decrease of 6.0 percent compared with the corresponding quarter of 2017. Net sales for the period January - September totalled SEK 907.5m. Organically, this corresponds to a decrease of 3.7 percent compared with 2017.
| 1 Jul-30 Sep | Organic | 1 Jan-30 Sep | Organic | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 growth, %* | 2018 | 2017 growth, %* | 2017 12 months | |||
| Incoming orders | 309.7 | 322.7 | -15.3 | 932.6 | 905.6 | -0.3 | 1,198.4 | 1,225.4 | |
| External net sales | 1 | 307.0 | 287.1 | -6.0 | 907.5 | 918.6 | -3.7 | 1,228.3 | 1,217.2 |
| Adjusted operating profit | 26.1 | 31.5 | 81.0 | 91.5 | 136.9 | 126.4 | |||
| Adjusted operating margin, % | 8.5 | 11.0 | 8.9 | 10.0 | 11.1 | 10.4 |
* Organic growth is the growth rate that does not come from acquisitions and currency effects, compared with the corresponding period in the previous year.
Orders received in the quarter grew to SEK 412.9m (342.9), equivalent to organic growth of 3.5 percent. Sales totalled SEK 410.5m (376.1), equivalent to an organic fall of 4.9 percent. Growth in the quarter was driven mainly by NEO Monitors, but also the core business where sales of products and smaller systems saw a positive development. Profitability declined during the quarter as a result of a less favourable product and market mix and increased development costs primarily for digital solutions.
The market situation within EMEA is stable with weak to moderate growth. Industrial investment remains at a relatively low level, but there are continuing signs of recovery. The long term effects of the UK's decision to leave the EU remain difficult to assess.
The order intake in Germany was slightly lower than the strong corresponding quarter in 2017. A major order for fibreglass production was booked in the quarter. The Nordic region saw weak organic growth in order intake while sales increased after good performance in Denmark. The Benelux countries recorded a good order intake in the quarter compared with the corresponding quarter of 2017. In Belgium, a major order for the railway industry and a medium-sized order for the vehicle industry aftermarket were booked.
In southern Europe, the picture was mixed with a slightly reduced order intake in France, while Spain and Portugal showed good growth, including a medium-sized order for the aviation industry. Even the UK saw a positive trend in order intake following, among others, a major order from the country's aviation industry.
Both Poland and the Czech Republic posted weaker development in the quarter. This trend is primarily explained by lower sales of medium-sized systems. Turkey posted a positive performance in the quarter despite challenging macroeconomic conditions.
NEO Monitors contributes to positive development. 3.5 percent organic growth in orders. Several medium-sized orders.
Distributor markets saw strong development of both order intake and sales in the quarter.
Incoming orders during the quarter amounted to SEK 412.9m. Organically, this corresponds to an increase of 3.5 percent compared with the same quarter of 2017. Incoming orders for the period January - September amounted to SEK 1,263.1m. Organically, this corresponds to a decrease of 1.6 percent compared with 2017. Net sales during the quarter totalled SEK 410.5m. Organically, this corresponds to a decrease of 4.9 percent compared with the corresponding quarter of 2017. Net sales for the period January - September totalled SEK 1,244.1m. Organically, this corresponds to an increase of 0.7 percent compared with 2017.
| 1 Jul-30 Sep | Organic | 1 Jan-30 Sep | Organic | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 growth, %* | 2018 | 2017 growth, %* | 2017 12 months | |||
| Incoming orders | 412.9 | 342.9 | 3.5 | 1,263.1 | 1,116.6 | -1.6 | 1,530.6 | 1,677.1 | |
| External net sales | 1 | 410.5 | 376.1 | -4.9 | 1,244.1 | 1,088.6 | 0.7 | 1,517.5 | 1,673.0 |
| Adjusted operating profit | 47.7 | 51.4 | 165.5 | 138.0 | 205.9 | 233.4 | |||
| Adjusted operating margin, % | 11.6 | 13.7 | 13.3 | 12.7 | 13.6 | 14.0 |
* Organic growth is the growth rate that does not come from acquisitions and currency effects, compared with the corresponding period in the previous year.
APAC saw a mixed development in the quarter with weaker order intake, but good sales growth. Orders received declined organically by 5.7 percent to SEK 95.3m (95.4), while sales increased organically by 8.2 percent to SEK 117.7m (105.5). Profitability fell in the quarter as a result of, among other factors, rising raw material prices. The adjusted operating result was SEK -1.5m (5.2), corresponding to an adjusted operating margin of -1.3 percent (4.9).
There are still good opportunities within the APAC region although some industrial segments in the commodity-intensive countries are characterised by weak demand and prolonged decision-making processes. In China, the new environmental legislation and other governmental initiatives are expected to entail a greater focus on environmental issues, in particular in regard to pollutant emissions and industries at risk of dust explosion hazards. Development is currently limited by significant problems for Nederman's customers in obtaining financing for their investments.
In China, orders received declined organically by almost 14 percent in the quarter. The decrease is just under 8 per cent for the first three quarters of the year. Some major orders were booked in the quarter, but overall sales of larger systems were at a lower level than in the corresponding quarter of the previous year. Profitability was negatively affected by rapid steel price increases and increased shipping and duty costs on export orders to North America.
Development in India is still volatile with large fluctuations between individual quarters. Orders received during the first three quarters of the year have fallen compared with a strong 2017.
In Thailand, order intake strengthened significantly compared with the third quarter of last year, while sales declined slightly. In Malaysia, order intake declined after changes in the country's tax system, while at the same time organic sales growth showed strong growth figures.
Reduced order intake in China Positive development in Thailand Lower profitability
There are continued signs of improvements in the business climate in Australia and order intake developed in line with expectations.
Incoming orders during the quarter amounted to SEK 95.3m. Organically, this corresponds to a decrease of 5.7 percent compared with the same quarter of 2017. Incoming orders for the period January - September amounted to SEK 316.0m. Organically, this corresponds to a decrease of 1.7 percent compared with 2017. Net sales during the quarter totalled SEK 117.7m. Organically, this corresponds to an increase of 8.2 percent compared with the corresponding quarter of 2017. Net sales for the period January - September totalled SEK 333.3m. Organically, this corresponds to an increase of 17.0 percent compared with 2017.
| 1 Jul-30 Sep | Organic | 1 Jan-30 Sep | Organic | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 growth, %* | 2018 | 2017 growth, %* | 2017 12 months | |||
| Incoming orders | 95.3 | 95.4 | -5.7 | 316.0 | 319.3 | -1.7 | 428.3 | 425.0 | |
| External net sales | 1 | 117.7 | 105.5 | 8.2 | 333.3 | 281.3 | 17.0 | 402.7 | 454.7 |
| Adjusted operating profit | -1.5 | 5.2 | -0.2 | -2.2 | 9.3 | 11.3 | |||
| Adjusted operating margin, % | -1.3 | 4.9 | -0.0 | -0.8 | 2.3 | 2.5 |
* Organic growth is the growth rate that does not come from acquisitions and currency effects, compared with the corresponding period in the previous year.
Today's ever faster digitalisation has created new and interesting opportunities for Nederman to develop its customer offering. The opportunities associated with connected services, the Internet of Things (IoT) and mobile devices such as smart phones and tablets, together form a platform that can provide Nederman's customers with new services and new values. Nederman Insight has built a competitive offering in a short period of time, and annualised order intake approaches approximately SEK 250 million. Nederman Insight is characterised by a high pace of innovation and rapid development of the organisation and it is still in the early stages of its global expansion.
During the third quarter of the year Nederman participated in the International Woodworking Fair 2018 (IWF) in Atlanta, USA, which with its 30,000 visitors is North America's largest trade fair for the timber industry. At the fair, Nederman Insight launched two new solutions developed for the timber industry: Wood Insight and SAVE. With Wood Insight, users can monitor their filter system performance in real-time and obtain valuable data to implement planned service measures. SAVE (Smart Air Ventilation Economics) monitors workstations and automatically adjusts fan and moisture configurations to create optimal conditions.
During the third quarter, Nederman Insight has conducted significant training initiatives in APAC and EMEA.
Nederman Insight can today, thanks to among other things two strategic acquisitions, compete with an overall offering to the Group's customers, which takes advantage of the major benefits that digitalisation offers, such as continuous system monitoring, risk management and easily-planned maintenance.
Auburn FilterSense LLC manufactures continuous particle monitoring systems. The technology is based on triboelectric and charge induction particles, intelligent controls with real-time diagnostics and software for filter leak detection, process control, maintenance planning, regulatory compliance and increased production efficiency.
As the first company in the world, NEO Monitors has developed a solution for on-site measurement of hydrogen using traditional infrared-based technology, which is well-proven in many other industrial applications.
The aim of Nederman Insight is to develop new digital solutions into a complete ecosystem of services over the next few years that can be marketed to both new and existing installations of Nederman's system. To achieve this, the company will successively build up the new competence necessary to create an attractive offering with a robust infrastructure for IoT.
The vision is to create a digital flow from filter to facts. The first step, Performance Tracking, is the ability to provide customers with data on the performance of their filter solutions through digital solutions. The goal of the next step, Process Optimisation, is to be able to help customers to utilise this knowledge in order to optimise their processes. A further step, Compliance, means that customers have total control of and reliable documentation about their industrial environment and their emissions.
The digital knowledge offering is based on Nederman's IoT platform - Nederman Insights. This platform, consisting of hardware installed in Nederman's products and solutions, and software that communicates with the cloud, provides customers with information and insights on critical parameters and processes.
As the new digital services and solutions are successively launched, they will strengthen Nederman's offering while at the same time consolidating and strengthening customer relationships in a way that was previously impossible.
The situation in Europe continues to be stable for both order intake and sales. In the US, we also see a continued stable development of the sales of core business while uncertainty surrounding major projects is expected to continue for some time although we have seen some improvement. The USMCA agreement should have positive effects. In Asia, several markets are seeing positive development. In China, increased environmental activity can be noted, but development is subdued by lack of funding.
October 17, 2018 Nederman signed and completed a deal to acquire 100% of the shares in Luwa Air Engineering AG, a global manufacturer and supplier of custom engineered air conditioning, waste handling and heat recovery systems for fibre applications. Luwa is based in Uster, Switzerland and operates through global entities in China, India, Singapore, USA and Turkey.
Luwa, founded in 1935, is a global market leader in textile air engineering and a quality and performance leader with a global brand in the fibre and textile industry. The Luwa Group's activities include the design and engineering of single components and whole systems as well as manufacturing, assembly, installation and after sales services. Manufacturing and assembly facilities are situated in India and China and the group has a significant global installed base that is the source of Luwa's deep understanding of the technical demands as well as the local requirements of customers.
The acquisition price amounts to CHF 28.5 million under a locked box mechanism, based on consolidated equity capital as of December 31, 2017 and therefore includes Luwa's cash positions. No interest is to be paid on the consideration for the period between December 31, 2017 and October 17, 2018.
The acquisition is funded by a combination of cash and existing bank facilities. The acquisition price will be paid in two instalments, the first instalment on October 17, 2018 and the second instalment of CHF 5.7 million two calendar years after completion.
The Luwa Group, with approximately 350 employees, had a turnover in 2017 of CHF 66 million. The acquired business currently has an EBITDA margin somewhat lower than that of the Nederman Group.
Luwa will be part of the Nederman Mikropul organisation. The Luwa brand and team will continue to operate as before, and their high quality solutions will add to the Nederman Group's capabilities in the strategically important global fibre and textile market.
Incoming orders during the quarter amounted to SEK 817.9m (761.0). Organically, this corresponds to a decrease of 5.6 percent compared with the corresponding period last year.
Net sales for the quarter amounted to SEK 835.2m (768.7). Organically, this corresponds to a decrease of 3.5 percent compared with the corresponding period last year.
Capital expenditure during the quarter was SEK 15.7m (10.0).
* As a consequence of the share split adopted by the annual general meeting, the earnings per share in previous year has been adjusted. See page 9 for further information.
Incoming orders were SEK 2,511.7m (2,341.5). Organically, this corresponds to a decrease of 1.1 percent compared with the same period last year.
Net sales amounted to SEK 2,484.9m (2,288.5). Organically, this corresponds to an increase of 1.0 percent compared with the same period last year.
Cash flow for the period amounted to SEK -140.5m (37.1) and cash flow from operating activities amounted to SEK 49.3m (136.7).
The lower operating cashflow is largely due to unfavourable cash position on larger projects. The cashflow for the period is also affected negatively by the acquisition of Auburn FilterSense LCC and by amortization of bank loans.
Capital expenditure during the period was SEK 39.5m (36.7), of which capitalised development costs amounted to SEK 3.4m (5.2).
Liquidity: At the end of the period the Group had SEK 231.1m in cash and cash equivalents as well as SEK 100.1m in available but unutilised overdraft facilities.
In addition, there was a credit facility of SEK 472.1m, which is a part of Nederman's loan agreement with SEB and a further loan facility of SEK 126.9m within Nederman's loan agreement with SHB.
The equity in the Group as of 30 September 2018 amounted to SEK 1,192.4m (995.6).
An ordinary dividend of SEK 6.00 per share was paid to shareholders in the second quarter, amounting in total to SEK 70.2m.
As a result of the share split that was approved by the annual general meeting having been completed, the number of shares in Nederman has increased by 23,430,680. As per 30 September 2018, the total number of shares and votes in the company amounts to 35,146,020 and total number of shares outstanding amounts to 35,088,753. The share capital remains unchanged and the par value of the share is changed from SEK 0.1 to SEK 0.03.
The equity ratio for the Group was 37.1 percent as of 30 September 2018 (38.5). The net debt/equity ratio was 59.0 percent (45.7).
The average number of employees during the period was 1,760 (1,702). The number of employees at the end of the period was 1,811 (1,769).
| 1 Jul-30 Sep | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|
| 2018 | 2017 | 2018 | 2017 | 2017 12 months | ||
| 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | 3,344.9 | |
| 68.4 | 82.3 | 232.6 | 217.0 | 338.5 | 354.1 | |
| 8.2 | 10.7 | 9.4 | 9.5 | 10.8 | 10.6 | |
| 50.6 | 69.3 | 177.6 | 179.0 | 278.1 | 276.7 | |
| 6.1 | 9.0 | 7.1 | 7.8 | 8.8 | 8.3 | |
| 50.6 | 69.3 | 181.4 | 179.0 | 285.8 | 288.2 | |
| 6.1 | 9.0 | 7.3 | 7.8 | 9.1 | 8.6 | |
| 43.9 | 63.2 | 153.2 | 162.2 | 260.1 | 251.1 | |
| 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 | |
| 0.94 | 1.22 | 3.23 | 3.23 | 5.31 | 5.31 | |
| 11.1 | 17.4 | 13.3 | 15.3 | 18.1 | 17.1 | |
| 10.6 | 18.8 | 13.6 | 16.1 | 18.0 | 17.2 | |
| 585.3 | 703.8 | |||||
| 54.4 | 59.0 | |||||
| 1.7 | 2.0 | |||||
| 11.8 | 8.9 | |||||
| 1 Jan-30 Sep |
* As a consequence of the share split adopted by the annual general meeting, the earnings per share in previous year has been adjusted. See page 9 for further information.
Currently the Nederman Group is restructuring the Group's operations with the goal of increasing both growth and profitability through simple structures and clear focus.
Specifically, this means that Nederman will be organised with a primary operational focus on four brands but with continued coordination in the Americas, EMEA and APAC regional segments.
The new organisation means that Nederman's expertise will have a clear impact on a global level. The new organisation will also further improve Nederman's work with the Group's key customers and expand the after-sales business which offers major scope for growth.
The new organisation is gradually being implemented during 2018 and will be reflected in Nederman's segment reporting with effect from 1st January 2019.
The Group and the parent company are exposed to a number of risks which are primarily due to the Group buying and selling products in foreign currencies. These risks are described in more detail in the company's management report on pages 48-49 and note 24 in the 2017 Annual Report. No circumstance that causes a change in the assessment of named risks has come to light.
In accordance with the AGM's guidelines for the Nomination Committee's work, Anders Mörck (Investment AB Latour, President), Göran Espelund (Lannebo Fonder), Fabian Hielte (Ernström & Co.) and Fredrik Ahlin (IF Skadeförsäkring AB) have been appointed to the Nomination Committee for the 2018 Annual General Meeting. Jan Svensson, Chairman of Nederman's Board, is adjunct to the Nomination Committee. For any questions concerning the Nomination Committee's work, please contact Anders Mörck at [email protected].
This interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and applicable provisions of the Swedish Annual Accounts Act. The interim report for the Parent Company has been prepared in accordance with the Swedish Annual Accounts Act Chapter 9 and RFR2. The same accounting policies and valuation principles apply as described in the latest Annual Report to the Group and the parent company (pages 61-65 of the Annual Report for 2017).
IFRS 15, effective for fiscal years beginning 1 January 2018, will not have any impact on reporting of consolidated income. For further information, see the Annual Report 2017, page 61.
IFRS 9, effective for fiscal years beginning 1 January 2018, will not have any significant impact on the consolidated reporting of the financial instruments. For further information, see the Annual Report 2017, page 61.
IFRS 16 replaces IAS 17 from 1 January 2019. An evaluation of the impact on the standard is ongoing. Further information will be presented in the Q4 year-end report 2018.
The Board and CEO confirm that the interim report provides a true and fair overview of the Parent Company and the Group's operations, position and earnings and describes the material risks and uncertainty factors faced by the Parent Company and the Group. The report has been reviewed by the company's auditor.
Chairman Member of the Board Member of the Board
Johan Hjertonsson Sven Kristensson Johan Menckel
Member of the Board Member of the Board Member of the Board and CEO
Jan Svensson Gunilla Fransson Ylva op den Velde Hammargren
Nederman's expertise and turnkey solutions within industrial air filtration protect people, machinery and the environment from the harmful effects of industrial processes. In this way Nederman helps to create safe work spaces, efficient production and significant environmental benefits. This interplay between health, environment and efficiency comes together to form the concept of eco-efficiency.
Eco-efficiency means that we contribute to both economic efficiency and long-term sustainable production. In terms of economy, it is about high production efficiency and product quality, machinery that has a long life and minimised environmental costs. From an environmental perspective it is about benefits from reduced emissions, more efficient use of materials and recycling, and lower energy consumption.
Nederman's customers are found in industries such as metal, wood and composite processing, food processing, pharmaceutical production, waste management, agriculture, textile industry, chemical industry, process industry, power generation and the automotive aftermarket.
Nederman has a strong global presence in regard to both sales and manufacturing. Sales are conducted through its own sales companies and distributors in over 50 countries. The main focus of sales is in Europe and North America, but Nederman is also active in a number of markets in Asia and South America. Manufacturing is carried out on five continents. Turnover in 2017 amounted to SEK 3.1 billion.
Nederman's aim is to achieve a sales growth of 8-10 percent over a business cycle and that an operating margin of at least reach 10 percent shall be achieved. To achieve these goals, Nederman is focusing on four priority areas:
During the last five years, sales growth has averaged 7.0 percent. During the period, the adjusted operating margin varied between 6.4 and 9.1 percent and in 2017 amounted to 9.1 percent. The average dividend during the period was 46 percent of net profit.
Nederman's sales model is divided into three segments in order to deliver solutions to customers' challenges as effectively as possible.
Product sales Nederman has a wide range of standard products that solve common problems related to smoke, gas, dust, materials recycling, the working environment and efficient production.
Solutions Nederman's solutions are designed to solve more complex tasks and specific customer problems. Business activities include careful preliminary study of the customer's business operations and needs, planning and system design, installation, commissioning and training.
Service and aftermarket Service is an integral part of Nederman's offering and a focus area for growth. By offering qualified service with good availability, Nederman helps to ensure continuous operation without expensive interruptions to customers' production.
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 | 2018 | 2017 | 2017 12 months | |
| Net sales | 1 | 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | 3,344.9 |
| Cost of goods sold | -530.1 | -478.7 | -1,552.5 | -1,420.2 | -1,948.6 | -2,080.9 | |
| Gross profit | 305.1 | 290.0 | 932.4 | 868.3 | 1,199.9 | 1,264.0 | |
| Selling expenses | -178.4 | -155.3 | -542.6 | -496.0 | -662.7 | -709.3 | |
| Administrative expenses | -60.6 | -55.9 | -187.8 | -170.9 | -222.2 | -239.1 | |
| Research and development expenses | -10.1 | -2.0 | -29.5 | -8.4 | -14.2 | -35.3 | |
| Acquisition costs | 3 | -0.0 | - | -3.8 | - | -7.7 | -11.5 |
| Other operating income/expenses | -5.4 | -7.5 | 8.9 | -14.0 | -15.0 | 7.9 | |
| Operating profit | 50.6 | 69.3 | 177.6 | 179.0 | 278.1 | 276.7 | |
| Financial income | 1.1 | -0.6 | 2.6 | 1.8 | 6.8 | 7.6 | |
| Financial expense | -7.8 | -5.5 | -27.0 | -18.6 | -24.8 | -33.2 | |
| Net financial items | -6.7 | -6.1 | -24.4 | -16.8 | -18.0 | -25.6 | |
| Profit before tax | 43.9 | 63.2 | 153.2 | 162.2 | 260.1 | 251.1 | |
| Taxes | -11.0 | -20.3 | -39.7 | -49.1 | -73.8 | -64.4 | |
| Net profit | 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 | |
| Net profit attributable to: | |||||||
| The parent company's shareholders | 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 | |
| Earnings per share | |||||||
| before dilution (SEK) | 0.94 | 1.22 | 3.23 | 3.23 | 5.31 | 5.31 | |
| after dilution (SEK) | 0.94 | 1.22 | 3.23 | 3.23 | 5.31 | 5.31 |
* As a consequence of the share split adopted by the annual general meeting, the earnings per share in previous year has been adjusted. See page 9 for further information.
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 12 months | ||
| Net profit | 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 | |
| Other comprehensive income | |||||||
| Items that cannot be reclassified to net profit | |||||||
| Revaluation of defined-benefit pension plans | -1.4 | -1.6 | -2.3 | -2.3 | -3.3 | -3.3 | |
| Tax attributable to items that cannot be reclassified to net | |||||||
| profit | 0.4 | 0.4 | 0.6 | 0.6 | 0.7 | 0.7 | |
| -1.0 | -1.2 | -1.7 | -1.7 | -2.6 | -2.6 | ||
| Items that have been or can be reclassified to net profit | |||||||
| Exchange differences arising on translation of foreign | |||||||
| operations | -16.0 | -22.2 | 76.0 | -36.9 | -28.2 | 84.8 | |
| Cash flow hedges | -0.0 | -0.4 | -0.0 | 4.1 | 3.1 | -1.0 | |
| Tax attributabl to items that can be reclassified to net profit | 0.0 | 0.1 | 0.0 | -0.9 | -0.7 | 0.2 | |
| -16.0 | -22.5 | 76.0 | -33.7 | -25.8 | 83.9 | ||
| Other comprehensive income for the period, net of tax | -17.0 | -23.7 | 74.3 | -35.4 | -28.4 | 81.3 | |
| Total comprehensive income for the period | 15.9 | 19.2 | 187.8 | 77.7 | 157.9 | 268.0 | |
| Total comprehensive income attributable to: | |||||||
| The parent company's shareholders | 15.9 | 19.2 | 187.8 | 77.7 | 157.9 | 268.0 |
| 30 Sep | 30 Sep | 31 Dec | ||
|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 | 2017 |
| Assets | ||||
| Goodwill | 1,064.0 | 682.6 | 969.9 | |
| Other intangible assets | 244.4 | 119.5 | 226.8 | |
| Tangible assets | 256.3 | 239.5 | 252.4 | |
| Long-term receivables | 9.6 | 5.1 | 5.4 | |
| Deferred tax assets | 13.8 | 66.4 | 16.8 | |
| Total fixed assets | 1,588.1 | 1,113.1 | 1,471.3 | |
| Inventories | 486.1 | 394.6 | 386.8 | |
| Accounts receivable | 2 | 545.9 | 496.8 | 529.5 |
| Other current receivables | 2 | 359.8 | 268.2 | 222.4 |
| Cash and cash equivalents | 2 | 231.1 | 314.3 | 360.9 |
| Total current assets | 1,622.9 | 1,473.9 | 1,499.6 | |
| Total assets | 3,211.0 | 2,587.0 | 2,970.9 | |
| Equity | 1,192.4 | 995.6 | 1,075.8 | |
| Liabilities | ||||
| Long-term interest-bearing liabilities | 2 | 801.9 | 662.4 | 822.5 |
| Other long-term liabilities | 179.3 | 1.5 | 153.7 | |
| Pension liabilities | 124.8 | 106.0 | 123.4 | |
| Other provisions | 8.9 | 7.5 | 9.5 | |
| Deferred tax liabilities | 22.0 | 19.6 | 17.0 | |
| Total long-term liabilities | 1,136.9 | 797.0 | 1,126.1 | |
| Current interest-bearing liabilities | 2 | 8.2 | 0.4 | 0.3 |
| Accounts payable | 2 | 325.9 | 254.5 | 298.9 |
| Other current liabilities | 2 | 526.2 | 514.6 | 444.3 |
| Provisions | 21.4 | 24.9 | 25.5 | |
| Total current liabilities | 881.7 | 794.4 | 769.0 | |
| Total liabilities | 2,018.6 | 1,591.4 | 1,895.1 | |
| Total equity and liabilities | 3,211.0 | 2,587.0 | 2,970.9 |
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK million | 2018 | 2017 | 2017 |
| Opening balance at beginning of period | 1,075.8 | 982.2 | 982.2 |
| Net profit | 113.5 | 113.1 | 186.3 |
| Other comprehensive income | |||
| Change in translation reserve for the period | 76.0 | -36.9 | -28.2 |
| Cash flow hedges, net of tax | -0.0 | 3.2 | 2.4 |
| Revaluation of defined-benefit pension plans, net of tax | -1.7 | -1.7 | -2.6 |
| Total other comprehensive income for the period | 74.3 | -35.4 | -28.4 |
| Total comprehensive income for the period | 187.8 | 77.7 | 157.9 |
| Transactions with Group owners | |||
| Dividend paid | -70.2 | -64.3 | -64.3 |
| Share-based remuneration | -1.0 | - | - |
| Closing balance at end of period | 1,192.4 | 995.6 | 1,075.8 |
| 1 Jan-30 Sep | Full year | Oct-Sep | |||
|---|---|---|---|---|---|
| SEK million | Note | 2018 | 2017 | 2017 12 months | |
| Operating profit | 177.6 | 179.0 | 278.1 | 276.7 | |
| Adjustment for: | |||||
| Depreciation and amortisation of fixed assets | 51.2 | 38.0 | 52.7 | 65.9 | |
| Other adjustments | -12.7 | 2.0 | 3.6 | -11.1 | |
| Interest received and paid incl. other financial items | -20.2 | -15.8 | -21.9 | -26.3 | |
| Taxes paid | -31.4 | -34.5 | -46.0 | -42.9 | |
| Cash flow from operating activities before changes in working capital | 164.5 | 168.7 | 266.5 | 262.3 | |
| Cash flow from changes in working capital | -115.2 | -32.0 | 12.8 | -70.4 | |
| Cash flow from operating activities | 49.3 | 136.7 | 279.3 | 191.9 | |
| Net investment in fixed assets | -27.5 | -35.2 | -51.8 | -44.1 | |
| Acquisitions | 3 | -38.3 | - | -233.3 | -271.6 |
| Cash flow before financing activities | -16.5 | 101.5 | -5.8 | -123.8 | |
| Dividend paid | -70.2 | -64.3 | -64.3 | -70.2 | |
| Cash flow from other financing activities | -53.8 | -0.1 | 149.4 | 95.7 | |
| Cash flow for the period | -140.5 | 37.1 | 79.3 | -98.3 | |
| Cash and cash equivalents at beginning of period | 360.9 | 287.8 | 287.8 | 314.3 | |
| Translation differences | 10.7 | -10.6 | -6.2 | 15.1 | |
| Cash and cash equivalents at end of period | 231.1 | 314.3 | 360.9 | 231.1 |
| 1 Jul-30 Sep | 1 Jan-30 Sep | Oct-Sep | |||||
|---|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 12 months | ||
| Operating profit/loss | -16.4 | -19.5 | -57.2 | -58.1 | -79.4 | -78.5 | |
| Result from investment in subsidiaries | 26.1 | 48.9 | 63.5 | 110.7 | 100.7 | 53.5 | |
| Other financial items | -1.8 | -5.0 | -19.2 | 4.6 | 18.5 | -5.3 | |
| Profit/loss after financial items | 7.9 | 24.4 | -12.9 | 57.2 | 39.8 | -30.3 | |
| Appropriations | - | - | - | - | 112.4 | 112.4 | |
| Profit/loss before tax | 7.9 | 24.4 | -12.9 | 57.2 | 152.2 | 82.1 | |
| Taxes | -1.6 | -5.1 | -4.4 | -5.1 | -8.9 | -8.2 | |
| Net profit/loss for the period | 6.3 | 19.3 | -17.3 | 52.1 | 143.3 | 73.9 |
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | ||||
|---|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 12 months | ||
| Net profit/loss | 6.3 | 19.3 | -17.3 | 52.1 | 143.3 | 73.9 | |
| Other comprehensive income | - | - | - | - | - | - | |
| Items that cannot be reclassified to net profit/loss | - | - | - | - | - | - | |
| Items that have been or can be reclassified to net profit/ | |||||||
| loss | - | - | - | - | - | - | |
| Other comprehensive income for the period, net of tax | - | - | - | - | - | - | |
| Total comprehensive income for the period | 6.3 | 19.3 | -17.3 | 52.1 | 143.3 | 73.9 |
| Interim report January–September 2018 | Parent company | VD-ord | |
|---|---|---|---|
| Balance sheet for the parent company in summary | |||
| SEK million | 30 Sep 2018 |
30 Sep 2017 |
31 Dec 2017 |
| Assets | |||
| Total fixed assets | 1,389.1 | 1,513.1 | 1,907.0 |
| Total current assets | 477.5 | 477.2 | 495.5 |
| Total assets | 1,866.6 | 1,990.3 | 2,402.5 |
| Shareholders' Equity | 780.3 | 777.6 | 868.8 |
| Liabilities | |||
| Total long-term liabilities | 461.3 | 662.2 | 974.0 |
| Total current liabilities | 625.0 | 550.5 | 559.7 |
| Total liabilities | 1,086.3 | 1,212.7 | 1,533.7 |
| Total equity and liabilities | 1,866.6 | 1,990.3 | 2,402.5 |
| Statement of changes in parent company | |||
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK million | 2018 | 2017 | 2017 |
| Opening balance at beginning of period | 868.8 | 789.8 | 789.8 |
| Net profit/loss | -17.3 | 52.1 | 143.3 |
| Other comprehensive income | |||
| Total other comprehensive income for the period | - | - | - |
| Total comprehensive income for the period | -17.3 | 52.1 | 143.3 |
| Transactions with owners | |||
| Dividend paid | -70.2 | -64.3 | -64.3 |
| Share-based remuneration | -1.0 | - | - |
| Closing balance at end of period | 780.3 | 777.6 | 868.8 |
| SEK million | 1 Jul-30 Sep 2018 | |||
|---|---|---|---|---|
| External net sales allocated on operating segments and | Service and after | |||
| sales segments | Product sales | Solution sales | market | Total |
| EMEA | 163.1 | 151.5 | 95.9 | 410.5 |
| APAC | 26.2 | 80.7 | 10.8 | 117.7 |
| Americas | 149.9 | 96.7 | 60.4 | 307.0 |
| Total | 339.2 | 328.9 | 167.1 | 835.2 |
| SEK million | 1 Jul -30 Sep 2017 | |||
| External net sales allocated on operating segments and | Service and after | |||
| sales segments | Product sales | Solution sales | market | Total |
| EMEA | 120.3 | 177.7 | 78.1 | 376.1 |
|---|---|---|---|---|
| APAC | 25.2 | 68.4 | 11.9 | 105.5 |
| Americas | 135.3 | 99.8 | 52.0 | 287.1 |
| Total | 280.8 | 345.9 | 142.0 | 768.7 |
| SEK million | 1 Jan-30 Sep 2018 | |||
|---|---|---|---|---|
| External net sales allocated on operating segments and | Service and after | |||
| sales segments | Product sales | Solution sales | market | Total |
| EMEA | 520.3 | 454.5 | 269.3 | 1,244.1 |
| APAC | 81.9 | 217.2 | 34.2 | 333.3 |
| Americas | 415.7 | 314.0 | 177.8 | 907.5 |
| Total | 1,017.9 | 985.7 | 481.3 | 2,484.9 |
| SEK million | 1 Jan-30 Sep 2017 | ||||
|---|---|---|---|---|---|
| External net sales allocated on operating segments and | Service and after | ||||
| sales segments | Product sales | Solution sales | market | Total | |
| EMEA | 385.9 | 456.6 | 246.1 | 1,088.6 | |
| APAC | 84.5 | 167.2 | 29.6 | 281.3 | |
| Americas | 407.3 | 331.0 | 180.3 | 918.6 | |
| Total | 877.7 | 954.8 | 456.0 | 2,288.5 |
Performance obligations for sales of Products and Service –and aftermarket are satisfied at the point in time at which the customer obtains control. Performance obligations from sales of solutions, in terms of project sales, are satisfied over time. Revenue is recognized according to the project´s rate of progression towards completion.
| 30 Sep 2018 | ||||
|---|---|---|---|---|
| Measured at | Derivatives that | Financial instruments | Total | |
| fair value via | are used for hedge | not reported | carrying | |
| SEK million | income statement | accounting | at fair value | amount |
| Accounts receivable | - | - | 545.9 | 545.9 |
| Foreign exchange forward contracts | ||||
| entered *) | 9.7 | 0.1 | - | 9.8 |
| Other current receivables | - | - | 250.9 | 250.9 |
| Cash and cash equivalents | - | - | 231.1 | 231.1 |
| Total | 9.7 | 0.1 | 1,027.9 | 1,037.7 |
| Financial leasing liabilities | - | - | 0.5 | 0.5 |
| Bank loans | - | - | 809.6 | 809.6 |
| Accounts payable | - | - | 325.9 | 325.9 |
| Foreign exchange forward contracts | ||||
| entered *) | - | 0.0 | - | 0.0 |
| Other current liabilities | - | - | 462.9 | 462.9 |
| Total | - | 0.0 | 1,598.9 | 1,598.9 |
*) The Group holds financial instruments in the form of currency futures that are recorded at fair value in the balance sheet. The fair value of currency futures is determined by discounting the difference between the contracted forward rate and the forward rate that can be subscribed on the closing date for the remaining contracted period. Discounting is made using market rates. The fair value for all contracts has been determined from directly or indirectly observable market data, i.e. level 2 according to IFRS 7. For other financial instruments, the fair value and the book value are materially consistent. For further information, refer to note 24 in the 2017 Annual Report.
On April 5th the Group acquired 100% of the shares in the American company, Auburn FilterSense LLC. The purchase prices amounts to SEK 55,9m, whereof SEK 11,7m is a potential earn-out payment based on profitability for 2018 and 2019. Maximum earn-out payment is USD 2.5m (SEK 20.7m). Acquired net assets amount to SEK 14.4m and the transaction resulted in an increased goodwill of SEK 41.5m. The acquisition's effect on consolidated cash and cash equivalents amounts to SEK 42.3m. The acquisition analysis is preliminary.
No member of the Board of Directors or senior executives have or have had any direct or indirect participation in any business transaction with Group companies which is or was of an exceptional character with regard to terms and conditions that occurred during the year or in any previous year. Nor has any Group company provided any loan, given any guarantees or entered into any surety relationships for any of the members of the Board of Directors or senior executives.
In addition to information on our reported IFRS results, we provide certain information on an underlying business performance basis. We believe that our underlying business performance measures provide meaningful supplemental information to both management, investors and other stakeholders. These underlying business performance measures should not be viewed in isolation or as substitutes to the equivalent IFRS measures, but should be used in conjunction with the most directly comparable IFRS measures in the reported results. This is a consistent application compared to previous periods. The following underlying business measures are used:
| Adjusted operating profit | Adjusted EBITDA margin |
|---|---|
| Adjusted operating margin | Net debt |
| EBITDA | Net debt/equity ratio |
| Adjusted EBITDA | Return on equity |
Return on operating capital Net debt/Adjusted EBITDA Interest Cover Ratio Organic growth
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | |||
|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 12 months | |
| Operating profit | 50.6 | 69.3 | 177.6 | 179.0 | 278.1 | 276.7 |
| Acquisition cost | 0.0 | - | 3.8 | - | 7.7 | 11.5 |
| Restructuring costs | - | - | - | - | - | - |
| Adjusted operating profit | 50.6 | 69.3 | 181.4 | 179.0 | 285.8 | 288.2 |
| Adjusted operating profit | 50.6 | 69.3 | 181.4 | 179.0 | 285.8 | 288.2 |
| Net sales | 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | 3,344.9 |
| Adjusted operating margin, % | 6.1 | 9.0 | 7.3 | 7.8 | 9.1 | 8.6 |
| Operating profit | 50.6 | 69.3 | 177.6 | 179.0 | 278.1 | 276.7 |
| Depreciation and amortization | 17.8 | 13.0 | 51.2 | 38.0 | 52.7 | 65.9 |
| EBITDA | 68.4 | 82.3 | 228.8 | 217.0 | 330.8 | 342.6 |
| EBITDA | 68.4 | 82.3 | 228.8 | 217.0 | 330.8 | 342.6 |
| Acquisition cost | 0.0 | - | 3.8 | - | 7.7 | 11.5 |
| Restructuring costs | - | - | - | - | - | - |
| Adjusted EBITDA | 68.4 | 82.3 | 232.6 | 217.0 | 338.5 | 354.1 |
| Adjusted EBITDA | 68.4 | 82.3 | 232.6 | 217.0 | 338.5 | 354.1 |
| Net sales | 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | 3,344.9 |
| Adjusted EBITDA margin, % | 8.2 | 10.7 | 9.4 | 9.5 | 10.8 | 10.6 |
| Cash and cash equivalents | 360.9 | 231.1 | ||||
| Long-term interest-bearing liabilities | 822.5 | 801.9 | ||||
| Pension liabilities | 123.4 | 124.8 | ||||
| Current interest-bearing liabilities | 0.3 | 8.2 | ||||
| Net debt | 585.3 | 703.8 | ||||
| Net debt | 585.3 | 703.8 | ||||
| Equity - Closing balance | 1,075.8 | 1,192.4 | ||||
| Net debt/equity ratio, % | 54.4 | 59.0 | ||||
| Equity - Opening balance | 1,176.5 | 976.3 | 1,075.8 | 982.2 | 982.2 | 995.6 |
| Equity - Closing balance | 1,192.4 | 995.6 | 1,192.4 | 995.6 | 1,075.8 | 1,192.4 |
| Equity - average | 1,184.5 | 985.9 | 1,134.1 | 988.9 | 1,029.0 | 1,094.0 |
| Net profit | 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 |
| Return on equity, % | 11.1 | 17.4 | 13.3 | 15.3 | 18.1 | 17.1 |
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | |||
|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 | 12 mån |
| Equity - average | 1,184.5 | 985.9 | 1,134.1 | 988.9 | 1,029.0 | 1,094.0 |
| Net Debt - opening balance | 728.1 | 527.2 | 585.3 | 524.3 | 524.3 | 454.5 |
| Net Debt - closing balance | 703.8 | 454.5 | 703.8 | 454.5 | 585.3 | 703.8 |
| Net Debt - average | 716.0 | 490.9 | 644.6 | 489.4 | 554.8 | 579.2 |
| Operating capital - average | 1,900.5 | 1,476.8 | 1,778.7 | 1,478.3 | 1,583.8 | 1,673.2 |
| Adjusted operating profit | 50.6 | 69.3 | 181.4 | 179.0 | 285.8 | 288.2 |
| Return on operating capital, % | 10.6 | 18.8 | 13.6 | 16.1 | 18.0 | 17.2 |
| Net debt | 585.3 | 703.8 | ||||
| Adjusted EBITDA | 338.5 | 354.1 | ||||
| Net debt/Adjusted EBITDA, multiple | 1.7 | 2.0 | ||||
| Profit before tax | 260.1 | 251.1 | ||||
| Financial expense | 24.8 | 33.2 | ||||
| Acquisition cost | 7.7 | 11.5 | ||||
| Restructuring costs | - | - | ||||
| EBT excl. financial expenses, acquisition costs and | ||||||
| restructuring costs | 292.6 | 295.8 | ||||
| Financial expense | 24.8 | 33.2 | ||||
| Interest cover ratio, multiple | 11.8 | 8.9 | ||||
| Incoming orders, same period in previous year | 761.0 | 696.6 | 2,341.5 | 2,161.8 | 2,992.3 | |
| Change in incoming orders, organic | -42.9 | 82.5 | -26.3 | 144.1 | 137.6 | |
| Change in incoming orders, currency effects | 48.2 | -18.1 | 44.6 | 35.6 | 10.6 | |
| Change in incoming orders, acquisitions | 51.6 | - | 151.9 | - | 16.8 | |
| Incoming orders | 817.9 | 761.0 | 2,511.7 | 2,341.5 | 3,157.3 | |
| Order growth, %, organic | -5.6 | 11.6 | -1.1 | 6.8 | 4.6 | |
| Order growth, %, currency effects | 6.3 | -2.3 | 1.9 | 1.5 | 0.3 | |
| Order growth, %, acquisitions | 6.8 | - | 6.5 | - | 0.6 | |
| Order growth, % | 7.5 | 9.3 | 7.3 | 8.3 | 5.5 | |
| Net sales, comparative period previous year | 768.7 | 792.0 | 2,288.5 | 2,287.2 | 3,107.3 | |
| Change in net sales, organic | -26.9 | -6.6 | 22.3 | -36.2 | 3.6 | |
| Change in net sales, currency effects | 47.1 | -16.7 | 46.8 | 37.5 | 9.9 | |
| Change in net sales, acquisitions | 46.3 | - | 127.3 | - | 27.7 | |
| Net sales | 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | |
| Sales growth, %, organic | -3.5 | -0.8 | 1.0 | -1.6 | 0.1 | |
| Sales growth, %, currency effects | 6.1 | -2.1 | 2.0 | 1.7 | 0.3 | |
| Sales growth, %, acquisitions | 6.0 | - | 5.6 | - | 0.9 | |
| Sales growth, % | 8.6 | -2.9 | 8.6 | 0.1 | 1.3 |
Non-allocated items refer mainly to costs relating to the parent company, Nederman Holding AB, which includes the central head office functions.
| 1 Jul-30 Sep | 1 Jan-30 Sep | Full year | Oct-Sep | |||
|---|---|---|---|---|---|---|
| SEK million | 2018 | 2017 | 2018 | 2017 | 2017 12 months | |
| EMEA | ||||||
| Incoming orders | 412.9 | 342.9 | 1,263.1 | 1,116.6 | 1,530.6 | 1,677.1 |
| External net sales | 410.5 | 376.1 | 1,244.1 | 1,088.6 | 1,517.5 | 1,673.0 |
| Depreciation | -8.5 | -5.6 | -25.9 | -16.3 | -23.6 | -33.2 |
| Adjusted operating profit | 47.7 | 51.4 | 165.5 | 138.0 | 205.9 | 233.4 |
| Adjusted operating margin, % | 11.6 | 13.7 | 13.3 | 12.7 | 13.6 | 14.0 |
| APAC | ||||||
| Incoming orders | 95.3 | 95.4 | 316.0 | 319.3 | 428.3 | 425.0 |
| External net sales | 117.7 | 105.5 | 333.3 | 281.3 | 402.7 | 454.7 |
| Depreciation | -0.7 | -0.9 | -2.1 | -2.7 | -3.5 | -2.9 |
| Adjusted operating profit | -1.5 | 5.2 | -0.2 | -2.2 | 9.3 | 11.3 |
| Adjusted operating margin, % | -1.3 | 4.9 | -0.0 | -0.8 | 2.3 | 2.5 |
| Americas | ||||||
| Incoming orders | 309.7 | 322.7 | 932.6 | 905.6 | 1,198.4 | 1,225.4 |
| External net sales | 307.0 | 287.1 | 907.5 | 918.6 | 1,228.3 | 1,217.2 |
| Depreciation | -4.5 | -3.6 | -11.9 | -12.1 | -15.9 | -15.7 |
| Adjusted operating profit | 26.1 | 31.5 | 81.0 | 91.5 | 136.9 | 126.4 |
| Adjusted operating margin, % | 8.5 | 11.0 | 8.9 | 10.0 | 11.1 | 10.4 |
| Other - non-allocated | ||||||
| Depreciation | -4.1 | -2.9 | -11.3 | -6.9 | -9.7 | -14.1 |
| Adjusted operating profit | -21.7 | -18.8 | -64.9 | -48.3 | -66.3 | -82.9 |
| The Group | ||||||
| Incoming orders | 817.9 | 761.0 | 2,511.7 | 2,341.5 | 3,157.3 | 3,327.5 |
| Net sales | 835.2 | 768.7 | 2,484.9 | 2,288.5 | 3,148.5 | 3,344.9 |
| Depreciation | -17.8 | -13.0 | -51.2 | -38.0 | -52.7 | -65.9 |
| Adjusted operating profit | 50.6 | 69.3 | 181.4 | 179.0 | 285.8 | 288.2 |
| Acquisition cost | -0.0 | - | -3.8 | - | -7.7 | -11.5 |
| Restructuring costs | - | - | - | - | - | - |
| Operating profit | 50.6 | 69.3 | 177.6 | 179.0 | 278.1 | 276.7 |
| Profit before tax | 43.9 | 63.2 | 153.2 | 162.2 | 260.1 | 251.1 |
| Net profit | 32.9 | 42.9 | 113.5 | 113.1 | 186.3 | 186.7 |
Nederman Holding AB (publ), Swedish corporate identity no. 556576-4205 To the Board of Directors
We have carried out a review of the interim financial information in summary (the interim report) for Nederman Holding AB as per 30 September 2018 and the nine-month period that ended on this date. The preparation of these accounts and their presentation in this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act is the responsibility of the Board of Directors and the CEO. Our responsibility is to express an opinion on this interim report based on our review.
We have conducted our review in accordance with the International Standard on Review Engagements ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different focus and is substantially narrower in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted accounting principles in Sweden.
The audit measures taken in a review do not enable us to obtain assurance that we would become aware of all significant matters that might have been identified in an audit. The conclusion based on a review does not therefore have the assurance that a conclusion based on an audit has.
Based on our review, nothing has come to our attention that causes us to believe that the interim financial information has not been prepared, in all material respects, for the Group in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the parent company in accordance with the Swedish Annual Accounts Act.
Helsingborg, 18 October 2018 Ernst & Young AB
Staffan Landén Authorized Public Accountant
A telephone conference regarding the report will be held, in English, today, Thursday, 18 October 2018 at 10.00. Nederman's President and CEO, Sven Kristensson and CFO, Matthew Cusick will present the report and answer questions.
To participate in the conference please call +46 8 566 426 62 or UK tel. no. +44 203 008 9801. The conference will also be streamed over the internet.
Visit our website to participate in the webcast: http://www.nedermangroup.com/sv-SE/Investors/Reports/ Webcast.
| • Full-year report | 19 February 2019 |
|---|---|
| • Interim report 1 | 17 April 2019 |
| • Annual General Meeting | 29 April 2019 |
| • Interim report 2 | 12 July 2019 |
| • Interim report 3 | 17 October 2019 |
This report contains forward-looking statements that are based on the current expectations of Nederman's management. Although management believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove correct. Accordingly, results could differ materially from those implied in the forward-looking statements as a result of, among other factors, changes in economic, market and competitive conditions, changes in the regulatory environment and other government actions, fluctuations in exchange rates and other factors.
Nederman is required to disclose the information provided herein according to the Swedish Securities Exchange and Clearing Operations Act and/or the Financial Instrument Trading Act. The information has been made public at 08.00 CET on 18 October 2018.
Sven Kristensson, CEO Telephone +46 (0)42-18 87 00 e-mail: [email protected]
Matthew Cusick, CFO Telephone +46 (0)42-18 87 00 e-mail: [email protected]
For further information, see Nederman's website: www.nedermangroup.com
Nederman Holding AB (publ), Box 602, 251 06 Helsingborg, Sweden Telephone +46 (0)42-18 87 00 Swedish corporate identity no.: 556576-4205
Operating profit before depreciation/amortization and impairment loss, excluding acquisition and restructuring costs.
Adjusted EBITDA margin Adjusted EBITDA as percentage of net sales.
Adjusted operating margin Adjusted operating profit as percentage of net sales.
Adjusted operating profit Operating profit excluding acquisition and restructuring costs
Annual average
Average of year-beginning and year-end balance.
Net profit attributable to Parent Company shareholders in relation to average number of share outstanding plus average number of convertibles and options, as calculated in accordance with IAS 33.
Net profit attributable to Parent Company shareholders divided by average number of shares outstanding.
Operating profit before depreciation/amortization and impairment loss.
EBITDA margin EBITDA as a percentage of net sales.
Equity divided by total assets (balance sheet total).
Profit before tax with return of financial expenses in relation to financial expenses.
Interest-bearing liabilities (including pensions) minus cash and cash equivalents.
Net debt/equity ratio Net debt divided by shareholders' equity.
Operating capital Shareholders' equity plus net debt.
Operating margin Operating profit as percentage of net sales.
Operating profit after depreciation/amortization and impairment loss.
Organic growth is the growth rate that does not come from acquisitions and currency effects, compared with the corresponding period in the previous year.
Net profit for the period divided by average shareholders' equity
Adjusted operating profit as a percentage of average operating capital
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