Quarterly Report • Apr 27, 2018
Quarterly Report
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Doro AB Corporate Identity number 556161-9429
Unchanged outlook: our expectation for 2018 is sales in the range of SEK 1.9bn - 2.1bn and EBIT in the range of SEK 100m - 140m, excluding potential acquisitions.
| DORO GROUP (SEKm) |
2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|
| Net sales | 419.6 | 452.3 | 1,924.0 |
| Sales growth, % | -7.2 | 9.5 | -1.8 |
| EBITDA | 38.5 | 31.3 | 156.2 |
| EBITDA margin, % | 9.2 | 6.9 | 8.1 |
| EBITA | 26.0 | 18.5 | 97.2 |
| EBITA margin, % | 6.2 | 4.1 | 5.1 |
| EBIT | 24.9 | 17.3 | 92.0 |
| EBIT margin, % | 5.9 | 3.8 | 4.8 |
| Profit after tax | 18.6 | 13.0 | 66.5 |
| Earnings per share | 0.78 | 0.56 | 2.83 |
| Equity/assets ratio, % | 54.8 | 47.0 | 49.6 |
Net sales
Sales decreased by 7.2%
Services revenue up 11.9%, Product revenue down 9.5%
Currency effects and increased efficiency in Services helped improve earnings and margins
Doro's sales were down by a total of 7.2 percent in the first quarter compared to the corresponding period of 2017. Sales in our category Products decreased by 9.5 percent due to a continuously challenging market for mobile phones. Sales in the Nordics and Central and Eastern Europe were down, while in other regions, sales were either stable or increased, despite a declining market. Sales in our category Services were up by 11.9 percent thanks to the positive progress of our subscription-based operation in Doro Care. Doro Care's contract with Oslo Municipality was expanded to cover all social alarm services for the municipality. We benefited from positive currency effects in Products which, combined with increased margin in Services, helped generate significantly higher earnings and improved margins in the quarter, despite lower sales.
Overall performance on our largest mobile phone market, Western Europe, has been negative for an extended period. This applies especially to the feature phones category, where we generate a significant share of sales. We are also encountering more competition in this category. To address the challenging market, we are working to increase our market shares, mainly in Southern and Eastern Europe, and strengthened our sales organization in Southern Europe in the quarter. We are also driving sales of our new products in established channels.
We launched two new mobile phones at the Mobile World Congress in February, the Doro 8035 (smartphone) and Doro 7060 (4G feature phone). During the quarter, our mobile phones received several awards, with the Doro 8040 recognized as the Best Senior Phone in Italy by Cellulare Magazine. The Doro 8040 also received the Red Dot Award 2018 for Best Product Design. Overall, this confirms that we have an offering that is relevant to our primary consumer segment—seniors.
After improving efficiency in our service delivery, which generated an improved gross margin for services, we are now focusing on reducing our cost base in areas such as procurement, logistics and administration. We have initiated significant consolidation of our warehouse units which, in addition to direct savings, will lower transportation costs, and are rationalizing our administrative functions.
Apart from mobile phone launches, we announced and demonstrated our new SmartCare by Doro service concept at the Mobile World Congress, which attracted substantial media attention in most European countries where we operate. SmartCare by Doro is part of our realigned strategy of delivering fully integrated solutions that provide seniors and their relatives with safety services. Development of the concept is going as planned, with the first service launches scheduled for the end of this year. We now have a dedicated Group function in place to drive service development and the critical integration with Doro mobile phones going forward. Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
With the first-quarter results in hand, we reiterate our expectations for the full year 2018 of sales in the range of SEK 1.9bn-2.1bn and EBIT in the range of SEK 100m-140m, excluding potential acquisitions.
Net sales down by 7.2%
Smartphone sales stable
Weak sales in the Nordics and Central and Eastern Europe
Positive currency effects in products
Gross margin expands to 33.8%, and EBIT margin to 5.9%
Doro's net sales for the first quarter amounted to SEK 419.6m (452.3), a 7.2 percent decrease compared to the first quarter 2017. Adjusted for currency effects, the downturn was 7.9 percent.
First-quarter order intake was down by 6.0 percent to SEK 399.2m (424.6). The value of the order book was SEK 294.6m (282.4) at the end of the quarter.
Sales in category Products were down by 9.5 percent, while sales in category Services increased by 11.9 percent compared to the first quarter 2017.
Sales of smartphones were stable in the quarter, comprising some 22 percent of total mobile phone sales. We enhanced our offering in this category further in the period, launching the new Doro 8035 smartphone.
Sales in the Nordics were down by 11.1 percent compared to the first quarter 2017. In the West and South Europe and Africa region, sales were up by 1.4 percent. In Central and Eastern Europe, sales decreased by 14.4 percent. Sales in the United Kingdom and Ireland increased by 7.0 percent, while sales in North America were up by 44.9 percent.
Doro's gross margin increased compared to the first quarter 2017 and amounted to 33.8 percent (29.3). The increase versus the previous year is mainly because the USD depreciated against the EUR and GBP. The remainder of the margin expansion is due to increased profitability in category Services.
First-quarter EBITDA was up by 23.0 percent to SEK 38.5m (31.3), corresponding to an EBITDA margin of 9.2 percent (6.9). The increased EBITDA was mainly due to an increased gross margin.
EBITA improved to SEK 26.0m (18.5). Amortization of intangible assets from business combinations according to plan was SEK -1.1 m (-1.2) in the quarter, corresponding to an EBIT of SEK 24.9m (17.3) and an EBIT margin of 5.9 percent (3.8).
Net financial items for the first quarter were SEK 0.2m (0.4) including the revaluation of financial instruments in foreign currencies.
Group tax for the quarter was SEK -6.5m (-4.7).
Profit after tax for the period was SEK 18.6m (13.0).
Cash flow from operating activities, SEKm
Cash flow from operating activities in the first quarter was SEK 54.5m (42.3), with the increase mainly due to higher EBIT and a decrease in working capital in the period. Free cash flow, after investments but before acquisitions, amounted to SEK 32.2m (26.5). Q1 Q2 Q3 Q4 Q1 2017 2018
Cash and cash equivalents were SEK 28.9m at the end of the first quarter (35.7). The equity/assets ratio was 54.8 percent (47.0) at the end of the period.
Net debt amounted to SEK 81.1m at the end of the first quarter, which can be compared to SEK 102.9m at the end of the previous quarter, and SEK 124.3m at the end of the first quarter 2017.
Effective January 1, 2018, Doro has altered the definition of its geographical market regions. In tandem with this change, Doro Care, which was previously reported as an independent region, is included in each region's net sales. Separate reporting of sales and gross margins in the Products and Services categories was introduced effective the same date.
Comparative figures for 2017 have been restated to comply with this new reporting method.
Jörgen Alsing became Vice President, and joined Group Management, heading up the new SmartCare & Services function.
Annika Björk became Human Resources Director and joined Group Management.
On February 16, 2018, Doro initiated a buyback program of shares for a total of up to SEK 25m. At the end of the quarter, shares corresponding to a value of SEK 12.6m had been repurchased.
Doro Care was awarded an agreement with Oslo municipality to deliver social alarm services to five districts in the municipality.
Doro published its Annual Report for 2017 on April 6, 2018.
Ireland
Rest of the World
| 7% 12% |
31% | Doro group (SEKm) | 2018 Jan-Mar |
Sales growth, % |
2017 Jan-Mar restated |
2017 Jan-Dec restated |
|---|---|---|---|---|---|---|
| Nordics | 130.2 | -11.1 | 146.5 | 556.2 | ||
| West and South Europe and Africa | 105.1 | 1.4 | 103.6 | 444.0 | ||
| 24% | Central and Eastern Europe | 102.4 | -14.4 | 119.6 | 557.0 | |
| United Kingdom and Ireland | 53.2 | 7.0 | 49.7 | 250.2 | ||
| North America | 32.6 | 44.9 | 22.5 | 96.1 | ||
| 25% | Rest of world | 2.1 | -62.5 | 5.6 | 23.7 | |
| Other | -6.0 | 4.8 | -3.2 | |||
| Nordics | Total | 419.6 | -7.2 | 452.3 | 1,924.0 |
* Note 1
Sales in the Nordics decreased by 11.1 percent compared to the first quarter 2017. The combination of a general downturn on the Nordic mobile phone market and high customer inventory levels impeded progress. This was partly offset by continued growth of sales in category Services. Central and Eastern Europe United Kingdom and
Sales increased by 1.4 percent in the West and South Europe and Africa region, supported by positive progress in Western Europe, where good smartphone sales were a contributor. The Doro 8040 was recognized as the best senior phone in Italy by trade journal Cellulare Magazine. A continued embargo on imports of mobile phones in Algeria reduced sales in Africa compared to the first quarter of the previous year. North America
Sales decreased by 14.4 percent in the first quarter, mainly due to customers having high inventories after poor sales to consumer in the previous quarter. The regional feature phone market contracted compared to the corresponding period of the previous year.
Sales increased by 7.0 percent in the first quarter. Doro increased its share of what remains a challenging mobile phone market, which contracted significantly compared to the first quarter 2017.
Sales increased by 44.9 percent mainly because of a weak comparative quarter. Our view is that sales levels in North America have stabilized. Preparations for the launch of a 4G feature phone in the region in the second half of 2018 are continuing as planned.
Net sales in the Rest of World region were SEK 2.1m (5.6).
Income and income adjustments not connected to any specific region amounted to SEK -6.0m (4.8) in the first quarter.
| 12,6% | Doro group (SEKm) | 2018 Jan-Mar |
Sales growth % |
2017 Jan-Mar restated |
2017 Jan-Dec restated |
||
|---|---|---|---|---|---|---|---|
| Products | 366.8 | -9.5 | 405.2 | 1,731.3 | |||
| 87,4% | Gross margin | 32.2% | 28.6% | 29.0% | |||
| Services | 52.7 | 11.9 | 47.1 | 192.7 | |||
| Gross margin | 44.5% | 36.2% | 41.7% | ||||
| Products | Total | 419.6 | -7.2 | 452.3 | 1,924.0 | ||
| Gross margin | 33.8% | 29.3% | 30.3% | ||||
| Services | * Note 2 |
Sales in the Product category decreased by 9.5 percent compared to the first quarter 2017, mainly because of lower mobile phone sales, due to poor market progress in the Nordics, as well as Central and Eastern Europe.
The gross margin for this category increased to 32.2 percent (28.6), most of which was due to positive currency effects, mainly from depreciation of the USD against the EUR and GBP.
Sales in the Services category increased by 11.9 percent, mainly because of expansion of Doro Care's subscriber base to about 126,000 (123,000) and higher average revenue per subscription. In the first quarter, Doro Care was awarded an expansion of the agreement with Oslo Municipality, adding approximately 3,500 subscriptions from end of April 2018. With the expansion, Doro Care will be responsible for handling all social alarm receiving services for Oslo Municipality. The gross margin for this category improved to 44.5 percent (36.2), mainly due to higher profitability in the service delivery within Doro Care.
Doro's shares are listed on Nasdaq Stockholm, Small Cap, Telecom/IT list. On March 31, 2018, the number of shares outstanding was 23 755 255. Shareholders' equity amounted to SEK 601.7m (530.9).
No transactions took place between Doro and related parties that had a material impact on the Company's financial position or results during the period.
Doro had 431 (486) employees as of March 31, 2018, equivalent to 360 (375) full-time employees. Of these, 319 (376) are based in the Nordics, 59 (53) in Central and Eastern Europe, 28 (33) in West and South Europe and Africa, 16 (15) in the United Kingdom and Ireland and 9 (9) in the Rest of the World.
Risks and uncertainty factors primarily relate to Doro's ability to continuously develop competitive products, supply disruptions, customer relationships, exchange rate fluctuations, loan finance, and the public tendering processes within Doro Care. Apart from these risks and uncertainty factors, which are described in more detail on pages 35 and 36 of the Annual Report, no other material risks were identified in the period.
The Parent Company's net sales for the first quarter amounted to SEK 332.7m (309.3). The profit after tax amounted to SEK 15,6m (4,8).
This interim report has been prepared on behalf of the Group according to IAS 34, Interim Financial Reporting, and for the Parent Company in accordance with the Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2 Accounting of legal entities. The accounting principles and calculation methods applied are consistent with those that were applied when drawing up the previous year's accounts, except that the Group applies IFRS 9, Financial instruments, and IFRS 15, Revenue from customer contracts, effective January 1, 2018. There are no material effects on the financial reports from the transit.
Doro's sales are subject to seasonal changes. Sales in the first quarter are normally the weakest in the year. Sales in the second and third quarter are normally sequentially higher than in the first quarter. Sales in the fourth quarter are normally the strongest in the year.
Our expectations for 2018 are sales in the range of SEK 1.9bn – 2.1bn and operating profit (EBIT) in the range of SEK 100m – 140m, excluding potential M&A.
The Q2 2018 report will be published on July 13, 2018.
This report will be presented via audiocast on April 27, at 09:00 CET.
Q2-report, January-June 2018: July 13, 2018 Q3-report, January-September 2018: October 19, 2018 Q4-report, January-December 2018: February 14, 2019
The Annual General Meeting will be held in Stockholm on April 27, 2018, at 14:00 CET.
Robert Puskaric, President and CEO, +46 (0)46 280 50 05 Carl-Johan Zetterberg Boudrie, CFO, +46 (0)46 280 50 47
E-mail: [email protected]
Analysts, investors and media are welcome to attend a presentation of the interim report via https://edge.media-server.com/m6/p/6da6bh6w or by telephone at 09:00 CET on April 27, 2018. Doro's President and CEO Robert Puskaric and CFO Carl-Johan Zetterberg Boudrie will hold the presentation and answer questions. Before the start of the presentation, the presentation material will be available at https://corporate.doro.com/investors/reports-andpresentations/presentations/.
| Sweden: | + 46 (0) 8 505 564 74 |
|---|---|
| France: | + 33 (0) 1 7075 0725 |
| UK: | + 44 (0) 203 364 5374 |
| US: | + 1 855 7532 230 |
Doro is a Swedish company that empowers seniors to live richer everyday lives. In addition to being the global market leader in senior mobile phones, Doro offers a wide array of products, services and smart care solutions tailored to meet the specific needs of seniors. These include services and solutions for connecting generations and providing greater peace of mind for relatives and friends. Furthermore, the Doro Care division offers social care and telecare solutions that enable elderly and disabled persons to continue living safely at home with the dignity and security they deserve.
Doro AB is a publicly traded company listed on the Nasdaq OMX Stockholm exchange, Nordic List, Small Companies. Doro reported net sales of SEK 1,924 million (EUR 200 million) for 2017. www.doro.com
| Doro Group (SEKm) | Note | 3 | 2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|---|---|
| Net sales | 419.6 | 452.3 | 1,924.0 | ||
| Cost of goods and services sold | -278.0 | -319.5 | -1,341.9 | ||
| Gross profit | 141.6 | 132.8 | 582.1 | ||
| Selling, distribution and marketing expenses | -60.7 | -60.5 | -277.4 | ||
| Research and development expenses | -23.0 | -26.2 | -103.0 | ||
| Administrative expenses | -34.0 | -32.1 | -116.6 | ||
| Other income and expense | 1.0 | 3.3 | 6.9 | ||
| Total operating expenses | -116.7 | -115.5 | -490.1 | ||
| whereof depreciation and amortisation of intangible and tangible fixed assets | -13.6 | -14.0 | -64.2 | ||
| Operating profit/loss before depreciation and amortisation (EBITDA) | 38.5 | 31.3 | 156.2 | ||
| Operating profit/loss after depreciation and amortisation (EBIT) | 24.9 | 17.3 | 92.0 | ||
| Net financial items | 0.2 | 0.4 | -0.3 | ||
| Profit/loss before taxes | 25.1 | 17.7 | 91.7 | ||
| Taxes | -6.5 | -4.7 | -25.2 | ||
| Profit/loss for the period | 18.6 | 13.0 | 66.5 | ||
| Average number of shares, thousands | 23 755 | 23 238 | 23 536 | ||
| Average number of shares after dilution, thousands* | 23 755 | 23 510 | 23 591 | ||
| Earnings per share, SEK | 0.78 | 0.56 | 2.83 | ||
| Earnings per share after dilution, SEK* | 0.78 | 0.56 | 2.82 | ||
| ) * The effect from dilution is considered only when the effect on earnings per share is negative. |
| Doro Group (SEKm) | 2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|
| Profit/loss for the period | 18.6 | 13.0 | 66.5 |
| Other comprehensive income to be reclassified to profit or loss in subsequent periods | |||
| Translation differences | 12.2 | -0.5 | 1.1 |
| Effects from cash flow hedges | -0.3 | -2.1 | -3.1 |
| Deferred tax | 0.1 | 0.5 | 0.7 |
| Total result related to Parent Company's shareholders | 30.6 | 10.9 | 65.2 |
| Doro Group (SEKm) | 2018 Mar 31 |
2017 Mar 31 |
2017 Dec 31 |
|---|---|---|---|
| Non-current assets | |||
| Intangible assets | 481.7 | 463.6 | 466.5 |
| Property, plant and equipment | 21.3 | 15.0 | 19.0 |
| Financial assets | 9.1 | 7.0 | 7.8 |
| Deferred tax assets | 9.7 | 13.0 | 9.5 |
| Current assets | |||
| Inventories | 215.1 | 231.6 | 196.9 |
| Current receivables | 331.5 | 362.8 | 420.5 |
| Cash and cash equivalents | 28.9 | 35.7 | 57.1 |
| Total assets | 1,097.3 | 1,128.7 1,177.3 | |
| Shareholders' equity attributable to Parent company shareholders | 601.7 | 530.9 | 583.7 |
| Long term liabilities | 62.8 | 149.8 | 119.2 |
| Current liabilities | 432.8 | 448.0 | 474.4 |
| Total shareholders' equity and liabilities | 1,097.3 | 1,128.7 1,177.3 |
| Financial instruments recognized at fair value in the Balance Sheet (SEKm) | 2018 Mar 31 |
2017 Mar 31 |
2017 Dec 31 |
|---|---|---|---|
| Exchange rate contracts recorded as current liability | 7.8 | 2.6 | 8.1 |
| Exchange rate contracts recorded as current receivable | 3.9 | 4.2 | 4.0 |
Financial instruments recognized at fair value consist of currency forward contracts and are used primarily for hedging purposes and are measured at level 2.
| Doro Group (SEKm) | Jan-Mar | Jan-Mar | Jan-Dec |
|---|---|---|---|
| Operating profit/loss after depreciation and write-downs, EBIT | 24.9 | 17.3 | 92.0 |
| Depreciation according to plan | 13.6 | 14.0 | 64.2 |
| Net paid financial items | -1.0 | -1.1 | -5.0 |
| Unrealized exchange rate differences in cash flow hedges | -0.5 | 5.4 | 9.9 |
| Taxes paid | -1.3 | -7.0 | -10.9 |
| Changes in working capital (including changes in provisions) | 18.8 | 13.7 | -30.7 |
| Cash flow from current activities | 54.5 | 42.3 | 119.5 |
| Investments in intangible and tangible fixed assets | -22.3 | -15.8 | -70.2 |
| Total free cash flow before acquisitions | 32.2 | 26.5 | 49.3 |
| Acquisitions | 0.0 | 0.0 | 0.0 |
| Cash flow from investment activities | -22.3 | -15.8 | -70.2 |
| Amortization of debt | -50.0 | -50.5 | -75.5 |
| New loans/changes in bank overdraft facility | 0.0 | 0.0 | 25.0 |
| Dividend/buy-back of shares | -12.6 | 0.0 | -23.2 |
| New share issue | 0.0 | 0.0 | 21.7 |
| Warrant program, new/buy-back | 0.0 | -1.2 | -1.2 |
| Cash flow from financing activities | -62.6 | -51.7 | -53.2 |
| Exchange rate differences in cash and cash equivalents | 2.2 | -0.1 | 0.0 |
| Change in cash and cash equivalents | -28.2 | -25.3 | -3.9 |
| Net debt | 81.1 | 124.3 | 102.9 |
| Doro Group (SEKm) | 2017 | 2017 | |
|---|---|---|---|
| Mar 31 | Mar 31 | Dec 31 | |
| Opening balance | 583.7 | 520.0 | 520.0 |
| Total result related to Parent company's shareholders | 30.6 | 10.9 | 65.2 |
| Dividend/buy-back of shares | -12.6 | 0.0 | -23.2 |
| New share issue | 0.0 | 0.0 | 21.7 |
| Closing balance | 601.7 | 530.9 | 583.7 |
2018
2017
2017
| Doro Group | 2018 Mar 31 |
2017 Mar 31 |
2017 Dec 31 |
|---|---|---|---|
| Order book end of period (SEKm) | 294.6 | 282.4 | 314.9 |
| Order intake in quarter (SEKm) | 399.2 | 424.6 | 500.6 |
| Gross margin, % | 33.8 | 29.3 | 30.3 |
| EBITA (SEKm) | 26.0 | 18.5 | 97.2 |
| Equity/assets ratio, % | 54.8 | 47.0 | 49.6 |
| Number of shares end of period, thousands | 23 755 | 23 238 | 23 755 |
| Number of shares end of period after dilution, thousands* | 23 755 | 23 363 | 23 755 |
| Shareholders' equity per share, SEK | 25.33 | 22.85 | 24.57 |
| Shareholders' equity per share after dilution, SEK* | 25.33 | 22.72 | 24.57 |
| Return on average shareholders' equity, % | 12.7 | 7.5 | 12.1 |
| Return on average capital employed, % | 14.6 | 7.9 | 13.5 |
| Share price at period's end, SEK | 43.55 | 53.75 | 43.70 |
| Market value (SEKm) | 1,034.5 | 1,249.1 | 1,038.1 |
* ) The effect of dilution is considered only when the effect on earnings per share is negative.
| NET SALES PER MARKET*) Doro Group (SEKm) |
2018 Jan-Mar |
2017 Jan-Mar recalc |
2017 Jan-Dec recalc |
|---|---|---|---|
| Nordics | 130.2 | 146.5 | 556.2 |
| West and South Europe and Africa (WSEA) | 105.1 | 103.6 | 444.0 |
| Central and Eastern Europe (CEE) | 102.4 | 119.6 | 557.0 |
| United Kingdom and Ireland | 53.2 | 49.7 | 250.2 |
| North America | 32.6 | 22.5 | 96.1 |
| Rest of the World | 2.1 | 5.6 | 23.7 |
| Other | -6.0 | 4.8 | -3.2 |
| Total | 419.6 | 452.3 | 1,924.0 |
| NET SALES PER CATEGORY*) Doro Group (SEKm) |
2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|
| Products | 366.8 | 405.2 | 1,731.3 |
| Gross margin, % | 32.2 | 28.6 | 29.0 |
| Services | 52.7 | 47.1 | 192.7 |
| Gross margin, % | 44.5 | 36.2 | 41.7 |
| Total | 419.6 | 452.3 | 1,924.0 |
| Gross margin, % | 33.8 | 29.3 | 30.3 |
| *) Note 2 |
| INCOME STATEMENT Parent company (SEKm) |
2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|
| Net sales | 332.7 | 309.3 | 1,531.8 |
| Cost of goods and services sold | -214.2 | -225.7 | -1,070.3 |
| Gross profit | 118.5 | 83.6 | 461.5 |
| Operating expenses | -99.1 | -79.0 | -415.4 |
| Operating profit/loss (EBIT) | 19.4 | 4.6 | 46.1 |
| Net financial items | 1.4 | 1.5 | 2.4 |
| Profit/loss after financial items | 20.8 | 6.1 | 48.5 |
| Group contribution | 0.0 | 0.0 | 1.4 |
| Taxes | -5.2 | -1.3 | -13.1 |
| Profit/loss for the period | 15.6 | 4.8 | 36.8 |
* ) Note 1
| STATEMENT OF COMPREHENSIVE INCOME Parent company (SEKm) |
2018 Jan-Mar |
2017 Jan-Mar |
2017 Jan-Dec |
|---|---|---|---|
| Profit/loss for the period | 15.6 | 4.8 | 36.8 |
| Other comprehensive income to be reclassified to profit or loss in subsequent periods | |||
| Effects from cash flow hedges | -0.3 | -2.1 | -3.1 |
| Deferred tax | 0.1 | 0.5 | 0.7 |
| Total result related to Parent company's shareholders | 15.4 | 3.2 | 34.4 |
| STATEMENT OF FINANCIAL POSITION Parent company (SEKm) |
2018 | 2017 | 2017 |
|---|---|---|---|
| Mar 31 | Mar 31 | Dec 31 | |
| Non-current assets | |||
| Intangible assets | 287.6 | 54.0 | 282.9 |
| Property, plant and equipment | 15.7 | 0.8 | 14.0 |
| Financial assets | 119.6 | 348.0 | 119.6 |
| Current assets | |||
| Inventories | 161.5 | 142.5 | 139.3 |
| Current receivables | 459.3 | 468.6 | 521.0 |
| Cash and cash equivalents | 7.5 | 18.2 | 41.5 |
| Total assets | 1,051.2 | 1,032.1 | 1,118.3 |
| Shareholders' equity attributable to Parent company's shareholders | 414.2 | 376.4 | 411.3 |
| Provisions | 44.4 | 74.1 | 58.6 |
| Long term liabilities | 50.0 | 110.0 | 100.0 |
| Short term liabilities | 542.6 | 471.6 | 548.4 |
| Total shareholders' equity and liabilities | 1,051.2 | 1,032.1 | 1,118.3 |
Effective 1 January 2018, Doro altered the reporting of sales per market to follow the geographical markets. Consequently, Doro Care is no longer reported as a separate region. The comparative figures for 2017 have been restated to comply with this new reporting model. Effective 1 January 2018, Doro changed the names of several of its geographical markets to make it clear what geographical regions they cover. The region named EMEA is changed to West and South Europe and Africa (WSEA), DACH is renamed Central and Eastern Europe (CEE), United Kingdom is renamed United Kingdom and Ireland and region USA and Canada is renamed North America.
| Net sales per market Doro Group (SEKm) |
2017 Jan-Mar recalc. |
2017 Apr-Jun recalc. |
2017 Jul-Sep recalc. |
2017 Oct-Dec recalc. |
2017 Jan-Dec recalc. |
|---|---|---|---|---|---|
| Nordics | 146.5 | 131.9 | 136.6 | 141.2 | 556.2 |
| West and South Europe and Africa (WSEA) | 103.6 | 99.2 | 109.7 | 131.5 | 444.0 |
| Central and Eastern Europe (CEE) | 119.6 | 128.3 | 121.5 | 187.6 | 557.0 |
| United Kingdom and Ireland | 49.7 | 57.5 | 68.8 | 74.2 | 250.2 |
| North America | 22.5 | 25.5 | 19.7 | 28.4 | 96.1 |
| Rest of the World | 5.6 | 4.7 | 4.6 | 8.8 | 23.7 |
| Other | 4.8 | -1.1 | 4.4 | -11.3 | -3.2 |
| Total | 452.3 | 446.0 | 465.3 | 560.4 | 1,924.0 |
Effective 1 January 2018, Doro reports Sales and Gross margin per category, Products and Services respectively. Products include sales of mainly telephone handsets and alarm devices and are non-recurring revenues. Services are normally offered as a package deal for a contracted period, including an alarm device, alarm receiving services, alarm response services and communication between the alarm device and the alarm receiving centre. Previously, Doro reported the period's recurring revenue. Recurring revenue is the main part of sales for the category Services. The comparative figures for 2017 have been restated to comply with this new reporting model.
| Net sales per category Doro Group (SEKm) |
2017 Jan-Mar restated |
2017 Apr-Jun restated |
2017 Jul-Sep restated |
2017 Oct-Dec restated |
2017 Jan-Dec restated |
|---|---|---|---|---|---|
| Products | 405.2 | 400.5 | 416.5 | 509.1 | 1,731.3 |
| Gross margin, % | 28.6 | 30.2 | 27.8 | 29.3 | 29.0 |
| Services | 47.1 | 45.5 | 48.8 | 51.3 | 192.7 |
| Gross margin, % | 36.2 | 38.0 | 42.3 | 49.4 | 41.7 |
| Total | 452.3 | 446.0 | 465.3 | 560.4 | 1,924.0 |
| Gross margin, % | 29.3 | 31.1 | 29.4 | 31.0 | 30.3 |
Effective 1 January 2018, Doro changed from an income statement based on the nature of expenses to a functional income statement. The reason for the change is that Doro is organised and controlled in functions and that a functional income statement gives a clearer view of Doro's development. Following this change, Doro also adjusts the definition of gross margin, including costs for services rendered and warranty costs et c in the cost for goods and services sold.
| 2017 | 2017 | 2017 | 2017 | 2017 Jan-Dec |
|---|---|---|---|---|
| recalc. | recalc. | recalc. | recalc. | recalc. |
| 452.3 | 446.0 | 465.3 | 560.4 | 1,924.0 |
| -319.5 | -307.2 | -328.4 | -386.8 | -1,341.9 |
| 132.8 | 138.8 | 137.0 | 173.5 | 582.1 |
| -60.5 | -67.4 | -63.5 | -86.0 | -277.4 |
| -26.2 | -24.7 | -23.9 | -28.2 | -103.0 |
| -32.1 | -29.4 | -27.9 | -27.2 | -116.6 |
| 3.3 | 1.4 | 1.2 | 1.0 | 6.9 |
| -115.5 | -120.1 | -114.1 | -140.4 | -490.1 |
| -14.0 | -14.7 | -16.5 | -19.0 | -64.2 |
| 31.3 | 33.8 | 38.0 | 53.1 | 156.2 |
| 17.3 | 19.1 | 21.5 | 34.1 | 92.0 |
| 0.4 | 0.2 | -0.1 | -0.8 | -0.3 |
| 17.7 | 19.3 | 21.4 | 33.3 | 91.7 |
| -4.7 | -4.0 | -5.7 | -10.8 | -25.2 |
| 13.0 | 15.3 | 15.7 | 22.5 | 66.5 |
| Jan-Mar | Apr-Jun | Jul-Sep | Oct-Dec |
| Average number of shares after dilution |
Average number of shares adjusted with the dilution effect from warrants is calculated as the difference between the assumed number of shares issued at the exercise price and the assumed number of shares issued at average market price for the period. |
|---|---|
| Earnings per share | Profit/loss after financial items minus tax divided by the average number of shares for the period. |
| Earnings per share after dilution | Profit/loss after financial items minus tax divided by the average number of shares for the period after dilution. |
| Number of shares at the end of the period, after dilution |
The number of shares at the end of the period adjusted with the dilution effect from warrants is calculated as the difference between assumed number of shares issued at the exercise price and the assumed number of shares issued at the closing market price at the end of the period. |
| Equity per share | Shareholders' equity at the end of the period divided by the number of shares at the end of the period. |
| Equity per share, after dilution | Shareholders' equity at the end of the period divided by the number of shares at the end of the period, after dilution. |
| Net debt/Net cash | Cash and bank balances less interest-bearing liabilities. |
| Market value, SEKm | Share price at period's end multiplied by the number of shares at the end of the period. |
Guidelines on Alternative Performance Measures (APMs) for companies with securities listed on a regulated market within the European Union have been issued by ESMA (the European Securities and Markets Authority). These guidelines apply to APMs disclosed when publishing regulated information on or after July 3, 2016. Reference is made in the interim report to a number of non-IFRS performance measures that are used to help investors as well as management analyse the company's operations. Described below are the non-IFRS performance measures that are used as a complement to the financial information that is reported in accordance with IFRS.
| Non-IFRS performance measure Description | Reason for use of measure | |
|---|---|---|
| Restructuring costs | Costs for impairment together with personnel costs in connection to restructuring |
This measure shows the specific costs that have arisen in connection to restructuring of a specific operation, which contributes to a better understanding of the underlying cost level in the continuing operations. |
| Gross margin, % | Net sales minus costs for goods and services sold as a percentage of net sales. |
Gross margin is an important measure for showing the margin before other external expenses |
| Sales growth comparable entities % |
Net Sales for the period minus Net Sales for entities acquired during the year minus Net Sales for the corresponding period last year in percentage of Net Sales for the corresponding period last year. |
Sales growth for comparable entities shows the Group's organic growth excluding acquired businesses. |
| Currency adjusted sales growth % Net Sales for the period recalculated using last year's currency exchange rates minus Net Sales for the corresponding period last year in percentage of Net Sales for the corresponding period last year. |
The measure shows the Sales growth excluding the effect of changes in currency exchange rates between the years. |
|
| Equity/assets ratio | Equity expressed as a percentage of total assets. | A traditional measure for showing financial risk, expressing the amount of total assets that is financed by the owners. |
| Return on shareholders' equity | Profit/Loss for the rolling twelve months after financial items and tax divided by average shareholders' equity. |
Shows from a shareholder perspective the return that is generated on the owners' capital that is invested in the company. |
| Capital employed | Total assets less non-interest-bearing debt and cash and bank balances. |
This measure shows the amount of total capital that is used in the operations and is thus one component for measuring the return from operations. |
| Return on average capital employed |
Operating profit/loss for the rolling twelve months, divided by the quarterly average capital employed excluding cash and bank balances. |
This is the central ratio for measuring the return on the capital tied up in operations. |
| Number of subscribers | Number of subscribers connected to the alarm receiving centre. |
The measure shows the volume of customers in the alarm receiving centre. |
| Calculation of financial performance measures | 2018 | 2017 | 2018 | 2017 |
|---|---|---|---|---|
| that are not defined in IFRS | Jan-Mar | Jan-Mar | Jan-Mar | Jan-Dec |
| Currency adjusted sales growth (SEKm) | ||||
| Currency adjusted sales growth | -35.7 | 30.6 | ||
| Currency effect | 3.0 | 8.7 | ||
| Reported sales growth | -32.7 | 39.3 | ||
| Capital employed | ||||
| Total assets | 1 097.3 | 1 128.7 | ||
| -Non-interest bearing liabilities | 385.6 | 422.5 | ||
| -Cash and bank | 28.9 | 35.7 | ||
| Reported capital employed | 682.8 | 670.5 |
The Board of Directors and the CEO confirm that this interim report provides a fair overview of the Company's and Group's business position and results and describes the significant risks and uncertainties faced by the Company and its subsidiaries.
This interim report has not been reviewed by the Company's auditors.
Lund, Sweden, April 27, 2018
Johan Andsjö Chairman of the Board Henri Österlund Vice chairman of the Board Lena Hofsberger Board member
Karin Moberg Board member Jonas Mårtensson Board member
Robert Puskaric President & CEO
This information is information that Doro AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above on page 8, at 08:00 CET on April 27, 2018.
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