Quarterly Report • Dec 7, 2017
Quarterly Report
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| 2017/18 | 2016/17 | 2017/18 | 2016/17 | |
|---|---|---|---|---|
| Aug–Oct | Aug–Oct | May–Oct | May–Oct | |
| 3 mths | 3 mths | 6 mths | 6 mths | |
| Net sales, SEK m. | 1,863.7 | 1,769.2 | 3,700.9 | 3,415.1 |
| Growth, % | 5.3 | 8.9 | 8.4 | 7.1 |
| Operating profit, SEK m. | 143.9 | 153.2 | 276.8 | 286.2 |
| Operating margin, % | 7.7 | 8.7 | 7.5 | 8.4 |
| Profit after tax, SEK m. | 101.4 | 115.2 | 177.0 | 214.8 |
| Earnings per share, SEK | 1.95 | 2.22 | 3.40 | 4.13 |
| Operating cash flow per share, SEK | 1.92 | 3.22 | 3.34 | 5.41 |
Over the second quarter, organic growth was 4.2 percent. Several regions reported strong growth, notably Eastern Europe with Russia at the forefront, and North America. Margins were affected by high raw material prices and lower volumes at some of the Group's factories. Price increases are under way to offset raw material costs, while we are seeing a market that remains strong, and many attractive projects.
The market as a whole performed well in the second quarter. The Nordic market remains buoyant, even if recent months have been characterised by uncertainty regarding house prices in city regions in the Swedish market. The Swedish market represents around 6 percent of Group sales, of which residential ventilation products make up 13 percent of sales in Sweden. Region Western Europe showed good growth during the quarter. Our deliveries of specially designed air handling units for delivery to Linde AG, Germany, are in progress. The order is valued at a total of EUR 15 million. It is anticipated that delivery of the order will be completed in the fourth quarter. In Eastern Europe, organic growth was 11 percent. Russia in particular continues to advance strongly. North and South America reported organic growth of 12 percent, driven by excellent results in Canada and Brazil. In the region Other markets, sales were lower than in the same quarter last year. This was a relative decline due to high volumes of deliveries to a major project in the region last year. In India, a new tax system has been introduced, leading to delays in deliveries to the market.
The new factory in Turkey has been completed and occupancy is now being taken up in phases. Systemair is also moving into a new, modern, leased production facility in Hyderabad, India. The factory will manufacture products for air distribution for delivery in the southern regions of India. In Denmark, installation of a new, modern sheet metal forming line is in the process of completion. The investment comprises a highproductivity, fully-automated production facility for sheet metal components for air handling units.
The relocation of production of air handling units from Frivent Austria to Slovenia is under way. The relocation is intended to enable cost efficiency improvements to be achieved in production. In Austria, all that will be left is a sales, marketing and component centre.
Growth remains buoyant in several of our markets, although we would have hoped for stronger growth in parts of Western Europe and South America. We have secured several exciting orders recently, including in India. We also have a value of nearly EUR 8.5 million left to deliver on Menerga's order for Linde AG of Germany in the second half-year.
Through several acquisitions in recent years, we have added new products to our range, where we identify major potential to reach out to new markets via our sales companies. Here, we are beginning to launch new, Group-wide product platforms to create new synergies, and there are more to come. We will also continue to make acquisitions and invest in production equipment, product development and marketing. A number of measures are ongoing in production, purchasing, sales and logistics and to improve long-term profitability.
Roland Kasper President and CEO
Group sales for the second quarter of the 2017/18 financial year totalled SEK 1,863.7 million (1,769.2), corresponding to an increase of 5.3 percent from the same period in the preceding year.
Adjusted for both foreign exchange effects and acquisitions, net sales grew 4.2 percent. Growth in acquired operations was 3.2 percent, while foreign exchange effects reduced sales by 2.1 percent during the period.
During the second quarter, sales in the Nordic region increased 4 percent from the same period in the preceding year. The Swedish and Finnish markets showed good growth during the quarter. Adjusted for foreign exchange effects and acquisitions, sales rose by 2 percent.
Sales in the West European market grew 9 percent during the quarter, compared with the corresponding period in the preceding year. Adjusted for foreign exchange effects and acquisitions, sales rose by 6 percent. Several markets in the region performed well during the period, including Portugal, Germany and Austria, while sales decreased in Spain, Belgium and Italy.
Sales in Eastern Europe and the CIS increased by 17 percent during the quarter. Adjusted for foreign exchange effects and acquisitions, sales rose by 11 percent. Sales in Russia continue to develop satisfactorily and have now risen for four consecutive quarters. Over the quarter, the Russian market accounted for 6 percent of Systemair's total sales, compared with 5 percent in the previous year.
Sales in the North and South America region during the quarter were 6 percent higher than in the same period last year. The Canadian market in particular performed well during the quarter. Adjusted for foreign exchange effects and acquisitions, sales rose by 12 percent.
Sales in Other markets declined 16 percent during the quarter compared to the same period the preceding year. Adjusted for the effects of foreign exchange and acquisitions, sales were down 9 percent. Sales in Qatar and India rose during the quarter, but fell in the Middle East, where sales figures for the preceding year included a major project delivery. Sales are also decreasing in South Africa, adjusted for acquisitions.
| 2017/18 | 2016/17 | 2017/18 | 2016/17 | |||||
|---|---|---|---|---|---|---|---|---|
| Aug–Oct | Aug–Oct | Sales – | Of which | May–Oct | May–Oct | Sales – | Of which | |
| 3 mths | 3 mths | change | organic | 6 mths | 6 mths | change | organic | |
| Nordic region | 456.8 | 440.8 | 4% | 2% | 840.0 | 769.2 | 9% | 6% |
| Western Europe | 757.1 | 694.2 | 9% | 6% | 1,506.6 | 1,369.9 | 10% | 3% |
| Eastern Europe & the CIS |
298.4 | 256.1 | 17% | 11% | 589.6 | 482.7 | 22% | 13% |
| North and South America |
157.6 | 148.3 | 6% | 12% | 338.6 | 317.0 | 7% | 8% |
| Other markets | 193.8 | 229.8 | -16% | -9% | 426.1 | 476.3 | -11% | -7% |
| Total | 1,863.7 | 1,769.2 | 5% | 4% | 3,700.9 | 3,415.1 | 8% | 4% |
(Sales figures are based on geographical domicile of customers.)
Net sales
The gross profit for the second quarter amounted to SEK 631.4 million (623.4), an increase of 1.3 percent over the same period in the preceding year. However, the gross margin declined to 33.9 percent (35.2). The main factors behind the lower gross margin were a negative product mix, higher raw material prices and insufficient volumes at some of the Group's factories.
Operating profit for the second quarter totalled SEK 143.9 million (153.2), down 6.1 percent from the same period in the preceding year. The operating margin was 7.7 percent (8.7). The lower operating margin is a consequence of a lower gross margin, as described above. Operating profit also takes into account a charge SEK 5.4 million relating to a factory closure in China, together with other restructuring costs.
Selling and administration expenses for the quarter totalled SEK 475.0 million (459.3), a rise of SEK 15.7 million or 3.4 percent. Costs arising from company acquisitions accounted for SEK 11.9 million of costs in the quarter. As a result, selling and administration expenses for comparable units rose by SEK 3.8 million.
Selling expenses were charged with SEK 4.8 million (4.4) for anticipated and confirmed impairment losses on trade receivables. During the quarter, acquisition-related costs totalled SEK 0.9 million (0.1).
Net financial items ended the second quarter at SEK -0.2 million (3.2). The effects of foreign exchange on long-term receivables, loans and bank balances were calculated at SEK +4.2 million (+8.9) net. Interest expense for the quarter totalled SEK -5.1 million (-5.2).
Estimated tax for the quarter amounted to SEK -42.3 million (-41.2), corresponding to an effective tax rate of 29.4 percent based on profit after net financial items.
In May 2017, Systemair AB completed the acquisition of Frivent Luft- & Wärmetechnik GmbH, Austria. Frivent is based in St. Johann, Tyrol, Austria. The company sells products for commercial and industrial use to a value of around EUR 7 million per year in Austria, Germany, the Czech Republic and Russia. The company produces air handling units, heat recovery systems and roof-mounted units for niche applications. In autumn 2017, work started on relocation of production to Systemair's factory in Slovenia. Frivent was consolidated on 1 May.
In June 2017, the South African subsidiary Systemair (Pty) Ltd acquired the assets of the South African company Viking Air Conditioning, a market-leading manufacturer of air handling units with integrated cooling. Viking is based in Spartan, Johannesburg, South Africa. The company produces and sells customised air handling units with integrated cooling for commercial use. Sales are valued at around SEK 40 million annually in South Africa and neighbouring countries. Viking has been selling high-quality air handling units with and without integral cooling for more than 25 years. The products are stocked by the leading supermarket chains, as well as other sellers, in the region. The company has 45 employees and operates from leased premises of 3,000 m2 . Viking was consolidated as of 1 June.
In September, the French subsidiary Frico S.A.S. acquired the operations of French company Hora S.A.S. The company operates as a reseller of electric ceiling
Operating margin per quarter, relative to the same period in previous years
Systemair AB Interim report Q2 2017/18 4(15)
heaters and has sales of around EUR 1.2 million. The acquisition includes 3 employed salespersons and agreements with approximately 15 agents.
If the above-mentioned acquisition had been consolidated as of the start of the financial year, it would not have had any material impact on the Group's sales and operating profit.
Note 1 in this report contains an acquisition analysis and an account of the effects of the acquisitions on the Group's cash and cash equivalents.
Investments for the quarter, excluding divestments, totalled SEK 121.1 million (140.1), including SEK 95.2 million (25.3) in new construction and machinery. The investments consisted in large part of investments in the factories in Denmark, Turkey and Slovenia. Acquisitions and formerly withheld additional purchase considerations totalled SEK 21.8 million (113.6) for the quarter. Depreciation of non-current assets amounted to SEK 48.8 million (45.8).
The average number of employees in the Group was 5,053 (4,707). At the end of the period, Systemair had 5,408 employees (5,049), 359 more than one year previous. New employees were recruited chiefly at Systemair in Lithuania (53), Menerga Germany (48), Sweden (30), India (29), Czech Republic (28), Germany (22), Canada (21), Malaysia (19), Slovakia (17) and Denmark (15). Personnel cutbacks were made in China (-28), Turkey (-16) and France (-15). Acquired companies added 89 employees to the Group, of whom 44 at Frivent in Austria and 45 at Viking in South Africa.
Cash flow from operating activities, before changes in working capital during the quarter, totalled SEK 191.9 million (166.6). Changes in working capital, mainly consisting of an increase in trade accounts receivable and inventories, had a negative impact on cash flow, SEK -92.3 million (+0.8). Cash flow from financing activities totalled SEK -50.0 million (-55.5) net. At the
end of the period, the Group's net indebtedness was SEK 1,610.4 million (1,476.3). The consolidated equity/assets ratio was 43.2 percent (43.8) at the end of the period.
No significant events have occurred since the end of the period.
Systemair is exposed to operational and financial risks in its business. Operational risks include the international nature of the operations, tough competition and the sensitivity of the construction industry to the business cycle. The financial risks that Systemair has identified in its business consist of foreign exchange risk, borrowing and interest rate risk, as well as credit risk and liquidity risk. The material risks and uncertainties affecting Systemair are described in more detail in the Company's 2016/17 Annual Report. No significant change occurred in the risk situation during the period.
Systemair's significant transactions with related parties concern ebmpapst AB and ebmpapst Mulfingen GmbH & Co. KG. Transactions with related parties are described in detail in Note 37 to the Accounts in the Annual Report for the 2016/17 financial year. During the period, no change worthy of mention occurred in the scale of these transactions.
The Parent Company's net sales for the financial year totalled SEK 53.8 million (47.2). Operating profit was negative, at SEK -41.2 million (-58.7). The company had 47 employees (44). The core business of the Parent Company is that of intra-Group services.
Systemair is a leading ventilation company with operations in 50 countries in Europe, North America, South America, the Middle East, Asia and Africa. The company had sales of approximately SEK 6.9 billion in
Systemair India has been chosen as supplier of a complete ventilation system for Wipro Limited, a leading global information and consulting company in Bangalore. The total value of the order is estimated at USD 1.6 million. The order will be delivered in its entirety during the current financial year. With this project, Systemair is leading the advance of sustainable, energy-efficient ventilation systems, by offering fans with EC technology for an area of 2.5 million square metres for 25,000 employees.
the 2016/17 financial year and approximately 5,200 employees. Systemair has reported an operating profit every year since 1974, when the company was founded. During the past 10 years, the Company's growth rate has averaged about 10 percent.
Systemair has well-established operations in growth markets. The Group's products are marketed under the Systemair, Frico, Fantech and Menerga brands. Systemair shares have been quoted on the Mid Cap List of the Nasdaq OMX Nordic Exchange in Stockholm since October 2007. The Group comprises about 70 companies.
The Company established operations in 1974 with a product concept, the circular duct fan, a design that considerably simplified the process of installation. We adopted the motto "the direct route", which has been developed from a product concept into a business philosophy. Our product range has expanded strongly to extend over a broad range of fans, air handling units, products for air distribution, air conditioning, air curtains and heating products.
Operating from the core values of simplicity and reliability, our business concept is to develop, manufacture and market high-quality ventilation products. On the basis of our business concept and with our customers in focus, our aim is to be seen as a company to rely on, with the emphasis on delivery reliability, availability and quality.
Availability is an important parameter in terms of our competitiveness, and we ensure effective control of our flow of goods, with owned production units, centralised warehouse facilities and an efficient ERP system. With modern production plants and our own sales companies around the world, we reach out directly to our customers.
The business model supports stability and development, and today we are a leading producer and supplier of ventilation products with our own production and own sales companies.
The following strategies create major strengths and competitive advantages that help us to achieve our goals.
The information in this Interim Report is information that Systemair is required to disclose in accordance with the Swedish Securities Markets Act (lagen om värdepappersmarknaden) and/or the Swedish Financial Instruments Trading Act (lagen om handel med finansiella instrument). This information has been submitted for publication at 8.00 a.m. on 7 December 2017.
The undersigned affirm that this six-month report provides a true and fair survey of the Parent Company's and the Group's operations, financial position and profits, as well as describing the material risks and uncertainty facing the Parent Company and the companies included in the Group.
Skinnskatteberg, 7 December 2017 Systemair AB (publ)
| Roland Kasper | Gerald Engström |
|---|---|
| Chief Executive Officer | Chairman |
| Carina Andersson | Svein Nilsen |
| Board member | Board member |
| Hans Peter Fuchs | Patrik Nolåker |
| Board member | Board member |
| Åke Henningsson | Ricky Sten |
| Employee Representative | Employee Representative |
Interim report Q3 2017/18 8.00 a.m., 15 March 2018 Year-end report Q4 2017/18 8.00 a.m., 14 June 2018 Interim report Q1 2018/19 1.00 p.m., 30 August 2018
President and CEO Roland Kasper
Telephone: +46 (0)222-440 13, +46 (0)730 94 40 13 E-mail: [email protected] CFO Anders Ulff Tel. +46 (0)222-440 09, +46 (0)70 577 40 09 E-mail: [email protected]
Co. Reg. No. 556160-4108 SE-739 30 Skinnskatteberg, Sweden Tel. +46-(0)222-440 00 [email protected] www.systemair.com.
We have reviewed the condensed interim financial information (interim report) for Systemair as per 31 October 2017 and the six-month reporting period ending on that date. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
We conducted our review in accordance with the International Standard on Review Engagements: ISRE 2410 "Review of Interim Financial Information Performed by the Independent Auditors of the Entity". A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. The emphasis and scope of a review differ considerably from that of an audit in accordance with International Standards on Auditing Standards (ISA) and other generally accepted auditing practices in Sweden.
The procedures performed in a review do not enable us to obtain a level of assurance to become aware of all significant matters that could have been identified in an audit. Accordingly we do not express a reasonable assurance conclusion.
Based on our review, nothing has come to our attention that causes us to believe that the interim report was not, in all material respects, prepared 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.
Stockholm, 6 December 2017 Ernst & Young AB
Åsa Lundvall Authorised Public Accountant
| Group | Company | Parent | ||||||
|---|---|---|---|---|---|---|---|---|
| SEK m. | 2017/18 Aug–Oct 3 mths |
2016/17 Aug–Oct 3 mths |
2017/18 May–Oct 6 mths |
2016/17 May–Oct 6 mths |
2016/17 Nov–Oct trail. 12 |
2016/17 May-Apr 12 mths |
2017/18 May–Oct 6 mths |
2016/17 May–Oct 6 mths |
| Net sales | 1,863.7 | 1,769.2 | 3,700.9 | 3,415.1 | 7,149.4 | 6,863.6 | 53.8 | 47.2 |
| Cost of goods sold | -1,232.3 | -1,145.8 | -2,462.5 | -2,218.4 | -4,746.5 | -4,502.4 | - | - |
| Gross profit | 631.4 | 623.4 | 1,238.4 | 1,196.7 | 2,402.9 | 2,361.2 | 53.8 | 47.2 |
| Other operating income | 23.0 | 24.7 | 51.8 | 46.1 | 125.3 | 119.6 | 0.8 | 2.4 |
| Selling expenses | -392.1 | -372.6 | -778.5 | -715.4 | -1,611.2 | -1,548.1 | -26.1 | -20.0 |
| Administration expenses | -82.9 | -86.7 | -165.6 | -169.0 | -361.7 | -365.1 | -40.9 | -41.5 |
| Other operating expenses | -35.5 | -35.6 | -69.3 | -72.2 | -125.7 | -128.6 | -28.8 | -46.8 |
| Operating profit | 143.9 | 153.2 | 276.8 | 286.2 | 429.6 | 439.0 | -41.2 | -58.7 |
| Net financial items | -0.2 | 3.2 | -27.1 | 5.5 | -61.4 | -28.8 | 241.6 | 291.6 |
| Profit after financial items | 143.7 | 156.4 | 249.7 | 291.7 | 368.2 | 410.2 | 200.4 | 232.9 |
| Appropriations | - | - | - | - | - | - | 0.5 | -3.3 |
| Tax on profit for the period | -42.3 | -41.2 | -72.7 | -76.9 | -111.8 | -116.0 | 6.2 | 8.2 |
| Profit for the period1 | 101.4 | 115.2 | 177.0 | 214.8 | 256.4 | 294.2 | 207.1 | 237.8 |
| Earnings per share, SEK2 | 1.95 | 2.22 | 3.40 | 4.13 | 4.93 | 5.66 | - | - |
| Profit for the period Other comprehensive income Items that have been, or may later be, transferred to profit for the year: |
101.4 | 115.2 | 177.0 | 214.8 | 256.4 | 294.2 | 207.1 | 237.8 |
|---|---|---|---|---|---|---|---|---|
| Translation differences | 33.5 | 66.9 | -20.4 | 139.6 | -75.3 | 84.8 | - | - |
| Impact of tax | 0.1 | -0.2 | 0.3 | -0.4 | 0.3 | -0.5 | - | - |
| Items that cannot be transferred to profit for the year: |
||||||||
| Revaluation of defined-benefit pensions, net after tax |
- | - | - | - | -1.4 | -1.4 | - | - |
| Other comprehensive income | 33.6 | 66.7 | -20.1 | 139.2 | -76.4 | 82.9 | - | - |
| Total comprehensive income for the period1 |
135.0 | 181.9 | 156.9 | 354.0 | 180.0 | 377.1 | 207.1 | 237.8 |
1) Profit for the period is attributable in its entirety to the Parent Company's shareholders.
2) No dilution effect arises since the options programme in operation has been arranged by Färna Invest.
| Group | Parent Company | ||||
|---|---|---|---|---|---|
| SEK m. | 31/10/2017 | 31/10/2016 | 30/04/2017 | 31/10/2017 | 31/10/2016 |
| ASSETS | |||||
| Goodwill | 728.0 | 723.6 | 691.4 | 0.2 | 0.3 |
| Other intangible assets | 200.3 | 192.7 | 193.3 | 19.2 | 3.1 |
| Property, plant and equipment | 1,538.4 | 1,395.2 | 1,413.4 | 29.3 | 14.0 |
| Financial and other assets | 201.9 | 199.8 | 200.6 | 2,419.4 | 2,350.4 |
| Total non-current assets | 2,668.6 | 2,511.3 | 2,498.7 | 2,468.1 | 2,367.8 |
| Inventories | 1,181.5 | 1,150.1 | 1,170.4 | - | - |
| Current receivables | 1,582.2 | 1,499.8 | 1,450.3 | 1,264.5 | 1,211.2 |
| Cash and cash equivalents | 208.3 | 229.3 | 241.8 | - | - |
| Total current assets | 2,972.0 | 2,879.2 | 2,862.5 | 1,264.5 | 1,211.2 |
| TOTAL ASSETS | 5,640.6 | 5,390.5 | 5,361.2 | 3,732.6 | 3,579.0 |
| EQUITY AND LIABILITIES | |||||
| Equity | 2,434.2 | 2,358.2 | 2,381.3 | 2,045.6 | 1,983.4 |
| Untaxed reserves | - | - | - | 5.1 | 5.5 |
| Non-current liabilities, non-interest-bearing | 232.7 | 242.0 | 259.1 | - | - |
| Non-current liabilities, interest-bearing | 368.2 | 416.3 | 319.3 | 418.0 | 460.4 |
| Total non-current liabilities | 600.9 | 658.3 | 578.4 | 418.0 | 460.4 |
| Current liabilities, interest-bearing | 1,391.3 | 1231.7 | 1,236.1 | 1,220.1 | 1,073.2 |
| Current liabilities, non-interest bearing | 1,214.2 | 1,142.3 | 1,165.4 | 43.8 | 56.5 |
| Total current liabilities | 2,605.5 | 2,374.0 | 2,401.5 | 1,263.9 | 1,129.7 |
| TOTAL EQUITY AND LIABILITIES | 5,640.6 | 5,390.5 | 5,361.2 | 3,732.6 | 3,579.0 |
| 2017/18 Aug–Oct |
2016/17 Aug–Oct |
2017/18 May–Oct |
2016/17 May–Oct |
2016/17 May-Apr |
|
|---|---|---|---|---|---|
| SEK m. | 3 mths | 3 mths | 6 mths | 6 mths | 12 mths |
| Operating profit | 143.9 | 153.2 | 276.8 | 286.2 | 439.0 |
| Adjustment for non-cash items | 62.7 | 66.3 | 78.8 | 112.6 | 158.4 |
| Financial items | -4.0 | -5.8 | -9.6 | -11.3 | -22.4 |
| Income tax paid | -10.7 | -47.1 | -42.5 | -70.8 | -128.7 |
| Cash flow from operating activities before changes in working capital |
191.9 | 166.6 | 303.5 | 316.7 | 446.3 |
| Changes in working capital | -92.3 | 0.8 | -130.0 | -35.2 | 18.2 |
| Cash flow from operating activities | 99.6 | 167.4 | 173.5 | 281.5 | 464.5 |
| Cash flow from investing activities | -118.0 | -132.5 | -279.4 | -158.7 | -281.3 |
| Cash flow from financing activities | -50.0 | -55.5 | 79.2 | -93.1 | -134.5 |
| Cash flow for the period | -68.4 | -20.6 | -26.7 | 29.7 | 48.7 |
| Cash and cash equivalents at start of period | 270.0 | 236.6 | 241.8 | 176.9 | 176.9 |
| Translation differences, cash and cash equivalents | 6.7 | 13.3 | -6.8 | 22.7 | 16.2 |
| Cash and cash equivalents at close of period | 208.3 | 229.3 | 208.3 | 229.3 | 241.8 |
| 2017/18 2016/17 May–Oct May–Oct |
2016/17 May-Apr |
|||||
|---|---|---|---|---|---|---|
| SEK m. | Equity attributable to Parent Company shareholders |
Total equity |
Equity attributable to Parent Company shareholders |
Total equity |
Equity attributable to Parent Company shareholders |
Total equity |
| Amount at beginning of year | 2,381.3 | 2,381.3 | 2,108.2 | 2,108.2 | 2,108.2 | 2,108.2 |
| Dividend | -104.0 | -104.0 | -104.0 | -104.0 | -104.0 | -104.0 |
| Comprehensive income | 156.9 | 156.9 | 354.0 | 354.0 | 377.1 | 377.1 |
| Amount at end of period | 2,434.2 | 2,434.2 | 2,358.2 | 2,358.2 | 2,381.3 | 2,381.3 |
| 2017/18 Aug–Oct |
2016/17 Aug–Oct |
2017/18 May–Oct |
2016/17 May–Oct |
2016/17 May-Apr |
||
|---|---|---|---|---|---|---|
| 3 mths | 3 mths | 6 mths | 6 mths | 12 mths | ||
| Net sales | SEK m. | 1,863.7 | 1,769.2 | 3,700.9 | 3,415.1 | 6,863.6 |
| Growth | % | 5.3 | 8.9 | 8.4 | 7.1 | 12.3 |
| Operating profit | SEK m. | 143.9 | 153.2 | 276.8 | 286.2 | 439.0 |
| Operating margin | % | 7.7 | 8.7 | 7.5 | 8.4 | 6.4 |
| Profit after net fin. items | SEK m. | 143.7 | 156.4 | 249.7 | 291.7 | 410.2 |
| Profit margin | % | 7.7 | 8.8 | 6.7 | 8.5 | 6.0 |
| Return on capital employed | % | 10.4 | 10.5 | 10.4 | 10.5 | 12.0 |
| Return on equity | % | 10.8 | 11.6 | 10.8 | 11.6 | 12.6 |
| Equity/assets ratio | % | 43.2 | 43.8 | 43.2 | 43.8 | 44.6 |
| Investments | SEK m. | 118.0 | 132.5 | 279.4 | 158.7 | 281.3 |
| Depreciation/Amortisation | SEK m. | 48.8 | 45.8 | 97.6 | 89.9 | 186.7 |
| Per share ratios | ||||||
| Earnings per share | SEK | 1.95 | 2.22 | 3.40 | 4.13 | 5.66 |
| Equity per share | SEK | 46.81 | 45.35 | 46.81 | 45.35 | 45.79 |
| Operating cash flow per share | SEK | 1.92 | 3.22 | 3.34 | 5.41 | 8.93 |
| No. of shares at end of period | No. | 52,000,000 | 52,000,000 | 52,000,000 | 52,000,000 | 52,000,000 |
| 2017/18 2016/17 |
2015/16 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Aug–Oct | May–Jul | Feb–Apr | Nov–Jan | Aug–Oct | May–Jul | Feb–Apr | Nov–Jan | Aug–Oct | ||
| Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | ||
| Net sales | SEK m. | 1,863.7 | 1,837.2 | 1,733.2 | 1,715.4 | 1,769.2 | 1,645.9 | 1,508.7 | 1,416.3 | 1,624.4 |
| Growth | % | 5.3 | 11.6 | 14.9 | 21.1 | 8.9 | 5.3 | 0.4 | -1.1 | 4.5 |
| Gross margin | % | 33.9 | 33.0 | 33.8 | 33.7 | 35.2 | 34.8 | 34.1 | 33.7 | 35.4 |
| Operating profit | SEK m. | 143.9 | 132.9 | 47.7 | 105.1 | 153.2 | 133.0 | 62.2 | 30.1 | 134.3 |
| Operating margin | % | 7.7 | 7.2 | 2.8 | 6.1 | 8.7 | 8.1 | 4.1 | 2.1 | 8.3 |
| Return on capital | ||||||||||
| employed | % | 10.4 | 10.8 | 12.0 | 11.9 | 10.5 | 10.1 | 10.2 | 9.3 | 10.5 |
| Return on equity | % | 10.8 | 11.4 | 12.6 | 12.9 | 11.6 | 10.6 | 9.8 | 9.9 | 11.4 |
| Equity/assets ratio | % | 43.2 | 44.0 | 44.6 | 45.5 | 43.9 | 45.0 | 43.9 | 43.6 | 42.8 |
| Basic equity per share | SEK | 46.81 | 46.22 | 45.79 | 44.46 | 45.35 | 43.85 | 40.54 | 39.74 | 40.40 |
| Basic earnings per share | SEK | 1.95 | 1.45 | 0.55 | 0.98 | 2.22 | 1.91 | 0.53 | 0.25 | 1.65 |
| Cash flow from operating activities per share |
SEK | 1.92 | 1.42 | -0.49 | 4.01 | 3.22 | 2.19 | -0.77 | 0.74 | 2.34 |
Systemair applies International Financial Reporting Standards (IFRS). This interim report was prepared for the group in accordance with the Swedish Annual Accounts Act, the Swedish Financial Reporting Board's recommendation RFR 1 and IAS 34 Interim Financial Reporting, and for the Parent Company in accordance with the Swedish Annual Accounts Act and RFR 2. The accounting principles and methods of calculation applied for the group and Parent Company accord with those used in preparing the most recent Annual Report.
The price paid for the shares in Frivent, Austria, for the assets of Viking, South Africa, and for the operations of Hora, France, may preliminary be calculated as follows:
Total historical cost, less transaction costs SEK 69.2 million
| Identifiable net assets | Total |
|---|---|
| Goodwill | 50.4 |
| Brands and customer relationships | 14.7 |
| Machinery and equipment | 6.9 |
| Financial and other assets | 5.0 |
| Inventories | 9.8 |
| Current receivables | 2.6 |
| Other current assets | 1.6 |
| Cash and cash equivalents | 6.5 |
| Non-interest-bearing liabilities (incl. deferred tax liability) | -9.9 |
| Interest-bearing liabilities | -12.3 |
| Other operating liabilities | -6.1 |
| 69.2 |
Transaction costs in the acquisition of subsidiaries totalled SEK 0.5 million.
The total effect on cash flow from the acquisitions, including payment of a formerly withheld additional purchase consideration for prior years' acquisitions, amounted to SEK -65.9 million. A non-interest-bearing non-current liability relating to withheld purchase considerations for the above-mentioned acquisitions totals SEK 8.8 million.
Brands and customer relationships have been stated at the net present value of future payment flows. The useful life of these assets has been estimated at 5-10 years.
The goodwill upon acquisition is attributable to the strong market position of the companies acquired, synergies expected to arise after the acquisition and the company's estimated future earning capacity.
Systemair's financial instruments consist of derivatives, trade accounts receivable, cash and cash equivalents, availablefor-sale financial assets, trade accounts payable, accrued supplier costs and interest-bearing liabilities. Liabilities to credit institutions carry variable interest rates or, in certain cases, fixed rates for a short period. Derivatives are measured at fair value via the income statement on the basis of input data corresponding to level 2 as defined in IFRS 13. Available-forsale financial assets are measured at fair value on the basis of input data corresponding to level 1 as defined in IFRS 13. Other financial assets and liabilities are short-term. For that reason, the fair values of all financial instruments are considered to equate approximately to the carrying amounts. Systemair has not recognised any financial assets and liabilities net.
For segment reporting, Systemair aggregates into the geographical segments of Europe and Rest of the World. The market segment Europe accounts for the major share of Systemair's business. The Europe segment consists of a large number of markets. The legal entities within Europe work with each other in manufacturing and sales. The Company also judges that in every material respect similar economic conditions exist in the region, and so the legal entities within the region have been aggregated. Systemair further considers that accounting for the merged segments Europe and Rest of World presents a clearer picture. The Parent Company is accounted for via a separate segment, Group-wide. The subsidiaries are merged on the basis of their legal domicile and consolidation takes place according to the same principles as for the Group as a whole.
| 2017/18 | 2016/17 | 2017/18 | 2016/17 | |
|---|---|---|---|---|
| Aug–Oct | Aug–Oct | May–Oct | May–Oct | |
| SEK m. | 3 mths | 3 mths | 6 mths | 6 mths |
| Europe | ||||
| Net sales, external | 1,530.5 | 1,436.7 | 2,975.8 | 2,730.5 |
| Net sales, intra-Group | 35.0 | 36.0 | 75.2 | 86.4 |
| Operating profit | 159.4 | 164.3 | 280.0 | 297.8 |
| Operating margin, % | 10.4 | 11.4 | 9.4 | 10.9 |
| Assets | 2,860.5 | 2,655.5 | 2,860.5 | 2,655.5 |
| Investments | 90.3 | 13.0 | 185.6 | 29.7 |
| Depreciation/Amortisation | 41.8 | 39.2 | 83.7 | 76.6 |
| Rest of World | ||||
| Net sales, external | 333.2 | 332.5 | 725.1 | 684.6 |
| Net sales, intra-Group | 1.8 | 3.1 | 5.1 | 8.4 |
| Operating profit | 12.3 | 16.8 | 38.5 | 46.9 |
| Operating margin, % | 3.7 | 5.1 | 5.3 | 6.9 |
| Assets | 811.0 | 855.4 | 811.0 | 855.4 |
| Investments | 1.4 | 2.5 | 7.8 | 6.9 |
| Depreciation/Amortisation | 5.7 | 5.7 | 11.3 | 11.4 |
| Group-wide | ||||
| Net sales, intra-Group | 26.5 | 23.3 | 53.8 | 47.2 |
| Operating profit | -27.8 | -27.9 | -41.7 | -58.5 |
| Assets | 3,735.4 | 3,584.8 | 3,735.4 | 3,584.8 |
| Investments | 26.3 | 117.0 | 86.0 | 122.1 |
| Depreciation/Amortisation | 1.3 | 0.9 | 2.6 | 1.9 |
| Eliminations | ||||
| Net sales, intra-Group | -63.3 | -15.1 | -134.1 | -94.7 |
| Assets | -1,766.3 | -1,705.2 | -1,766.3 | -1,705.2 |
| Total | ||||
| Net sales, external | 1,863.7 | 1,769.2 | 3,700.9 | 3,415.1 |
| Operating profit | 143.9 | 153.2 | 276.8 | 286.2 |
| Operating margin, % | 7.7 | 8.7 | 7.5 | 8.4 |
| Assets | 5,640.6 | 5,390.5 | 5,640.6 | 5,390.5 |
| Investments | 118.0 | 132.5 | 279.4 | 158.7 |
| Depreciation/Amortisation | 48.8 | 45.8 | 97.6 | 89.9 |
In its interim report, Systemair presents key ratios that supplement the financial ratios defined in IFRS; these are known as alternative performance measures (APMs). The Company is of the view that these APMs provide valuable information to investors and the Company's management, in that they enable evaluation of the Company's performance, trends, capacity to pay down debt and invest in new business opportunities, and that they reflect the Group's acquisition-intensive business model.
Because not all companies calculate financial key ratios in the same way, these are not always comparable. As a result, they should not be regarded as substitutes for key ratios as defined in IFRS. A number of definitions appear below, the majority of which are alternative performance measures.
Earnings before financial items and tax.
Growth is defined as the change in net sales, relative to net sales for the preceding period.
Change in sales by comparable units, adjusted for acquisitions and foreign currency effects.
Operating profit excluding restructuring costs.
Operating margin Operating profit divided by net sales.
Profit after financial items divided by net sales.
Profit after financial income, for the trailing 12 months (TTM), divided by average capital employed.
Total assets less non-interest-bearing liabilities.
Profit after tax before non-controlling interest, for the trailing 12 months (TTM), divided by average equity excluding non-controlling interest.
The number of employees at the end of the accounting period. New employees, appointments terminated, part-time employees and paid overtime are converted into full-time equivalents.
Profit for the period attributable to Parent Company shareholders, divided by the average number of shares during the period.
Cash flow from operating activities for the period, divided by the average number of shares during the period.
Adjusted equity divided by total assets.
Equity divided by the number of shares at the end of the period.
The Ecodesign Directive lays down minimum requirements for energy performance in products and outlaws the most energy- and resourceintensive products in the EU market.
Organisations that certify products in the ventilation industry in the markets in Europe, the Middle East, Asia and North America, on the basis of impartial third-party inspection.
Low-energy or passive houses that are built airtight and are subject to strict demands for effective ventilation and low energy consumption.
Uses of products in different types of building. For example, single-family homes, apartment blocks, hospitals, industrial buildings and tunnels.
In a building, the computerised system that controls and monitors functions such as those for the building's ventilation, lighting, electricity supply, fire safety and security.
An IT system that manages, for example, processes such as financial management, sales and service, logistics, distribution and production.
An IT system that handles control, organisation and administration of customers and customer relations in a business.
Building tools?
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