Quarterly Report • Oct 24, 2017
Quarterly Report
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Doro AB Corporate Identity Number 556161-9429
Unchanged outlook: Our expectation for 2017 is that both sales and EBIT will increase compared to 2016.
| DORO GROUP (SEKm) |
2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Net sales | 465.3 | 473.2 | 1,363.6 | 1,359.7 | 1,959.1 |
| Net sales growth, % | -1.7 | 6.4 | 0.3 | 12.7 | 7.1 |
| EBITDA | 38.0 | 32.9 | 103.1 | 76.2 | 121.4 |
| EBITDA margin, % | 8.2 | 7.0 | 7.6 | 5.6 | 6.2 |
| EBITA | 22.6 | 15.9 | 61.5 | 33.7 | 55.1 |
| EBITA margin, % | 4.9 | 3.4 | 4.5 | 2.5 | 2.8 |
| EBIT | 21.5 | 13.9 | 57.9 | 27.4 | 47.7 |
| EBIT margin, % | 4.6 | 2.9 | 4.2 | 2.0 | 2.4 |
| Profit after tax | 15.7 | 12.6 | 44.0 | 19.6 | 31.0 |
| Earnings per share | 0.66 | 0.54 | 1.88 | 0.84 | 1.33 |
| Equity/assets ratio, % | 46.1 | 42.5 | 46.1 | 42.5 | 40.4 |
Net sales growth
Sales down 1.7%
Doro Care increases sales by 30%
US sales downturn has levelled off
Rationalization continues—higher profitability
Positive reception of new product launches
Unchanged outlook for 2017
Doro's sales were stable in the quarter, despite sales in the US falling, and an import embargo in Algeria that had a negative impact on the EMEA region. Simultaneously we increased our earnings. Net sales in the third quarter were down by 1.7 percent to SEK 465.3m (473.2), while growth excluding the US and Canada increased by 1.2 percent. Order intake was up 0.6 percent to SEK 561.4m (557.9), and the order book expanded by 5.9 percent. Our earnings improvement continued in the third quarter. Despite gross margin contracting to 37.5 percent (39.3), our operating margin increased to 4.6 percent (2.9). After three consecutive quarters of earnings improvement, we can conclude that actions to increase the operating efficiency are paying off.
Doro Care increased sales by 30 percent in like-for-like terms, supported by progress in Germany, and a higher level for our subscription-based operation in the Nordics, where the subscriber base was larger than in the corresponding period of last year.
Sales in the US/Canada region were down year-on-year also in the third quarter. However, the downturn was lower than in the second quarter of this year. The increase in mobile phone sales throughout 2016 by Doro's operator customers in the region was due to a shift in technology from 2G to 3G throughout 2016. We think the sales downturn has levelled out. We are planning for the next technology generation on the North American market, with the ambition of launching a 4G phone in the second half of 2018.
Our impression is that the general mobile phone market was weak in the third quarter, but that Doro thanks to its orientation towards the senior segment successfully defended or increased market shares in its regions. The UK was our best-performing region in the quarter, achieving a sales growth of 20 percent.
As part of our overall process of streamlining our operations, we focused on a number of actions in the aftermarket and supply chain in the period. With our strong earnings performance this year to date, we can see we are heading in the right direction, and I'm looking forward to our ongoing work on continuous improvement.
We launched several new products in the quarter, mostly at the IFA trade show in Berlin - all received positive initial reactions. The launch of our new smartphone, the Doro 8040, attracted heavy media attention, and sales have started on most of our markets.
We're currently formulating our strategy for developing Doro over the coming years, and will present this at a capital markets day in November in Stockholm.
Results for January-September support an unchanged outlook for 2017: our expectation for 2017 is that both sales and EBIT will increase compared to 2016.
Sales growth excluding US/Canada 1.2%
High sales in the UK, and for Care, weaker for other regions
Doro Care's sales up by 30% on the previous year
Doro's net sales for the third quarter amounted to SEK 465.3m (473.2), a 1.7 percent decrease on the third quarter 2016. Adjusted for currency effects, the downturn was 0.8 percent. Excluding the US/Canada region, sales were up by 1.2 percent.
Third-quarter order intake was up 0.6 percent in like-for-like terms year-on-year (including Trygghetssentralen), to SEK 561.4m (557.9). The value of the order book was SEK 374.7m (353.9) at the end of the quarter.
Sales in the Nordics were down 5.7 percent year-on-year. However, this downturn was less than for the general Nordic mobile phone market, suggesting that we increased our market share in a weak market in the period.
Sales in the DACH region decreased 6.5 percent after robust progress in the first half-year. Considering that performance was better than the overall German market, our view is that we defended our market share successfully in this region.
Sales in the EMEA region declined 12.5 percent, largely due to an embargo on mobile phone imports to Algeria, which restricted our sales in the quarter, as well as a strong comparative quarter.
Negative sales growth continued in the US/Canada region, with a 40 percent decrease on the third quarter 2016. The increase in mobile phone sales throughout 2016 by Doro's operator customers in the region was due to a shift in technology from 2G to 3G. The downturn was lower than in the second quarter of this year, indicating that the sales downturn levelled off in the third quarter.
Sales in the UK increased by 20 percent in the third quarter, supported by increased marketing efforts and relatively healthy retail growth.
Sales of smartphones increased as planned in the quarter, representing some 19 percent of Doro's total mobile phone sales. Our offering in this category is in continuous focus and regeneration, with the launch of our new smartphone, the Doro 8040, in September being a good example.
Doro Care's progress continued in the third quarter. Sales increased 30 percent, supported by healthy growth in Germany, and higher subscription income in the Nordics in year-on-year terms. Sales were SEK 66.0m for the third quarter (50.6), of which SEK 45.6m (35.4), was subscription income.
Doro's gross margin decreased on the third quarter 2016, and was 37.5 percent in the third quarter (39.3). Most of the year-on-year decline is attributable to a negative currency effect from the revaluation of forward contracts. All else equal, depreciation of the USD against the EUR has a positive impact on Doro's operating profit.
Third-quarter EBITDA increased 15.5 percent to SEK 38.0m (32.9), corresponding to an EBITDA margin of 8.2 percent (7.0). The increased EBITDA was mainly due to lower overhead expenses compared to the third quarter 2016, which more than offset lower gross profit.
EBITA also improved significantly, to SEK 22.6m (15.9). Amortization of intangible assets from business combinations according to plan was SEK -1.1 m (- 2.0) in the quarter, corresponding to an EBIT of SEK 21.5m (13.9) and an EBIT margin of 4.6 percent (2.9). EBIT includes restructuring expenses of SEK 1.3m (4.3). 10 2016 2017
Net financial items for the third quarter were SEK -0.1m (-0.1) including the revaluation of financial instruments in foreign currencies. 5 7,5
Group tax for the quarter was SEK -5.7m (-1.2). 2,5
Profit after tax for the period was SEK 15.7m (12.6). 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Cash flow from operating activities in the third quarter was SEK 24.7m (36.5), with the decrease mainly due to an increase in working capital due to inventory build-up. Cash flow before changes in working capital increased to SEK 36.1m (21.8). Free cash flow, after investments but before business combinations, decreased to SEK 6.4m (18.7).
Cash and cash equivalents were SEK 64.4m at the end of the third quarter (22.9). At the same time, the equity/assets ratio was 46.1 percent (42.5).
Net debt declined in the period, amounting to SEK 120.6m at the end of the third quarter, which can be compared to SEK 127.2m at the end of the previous, second, quarter, and SEK 178.6m at the end of the third quarter 2016.
At the beginning of July, Susanne von Wowern voluntarily resigned from her position as Human Resources Director of Doro and left the company at the beginning of August. Åsa Lindé Tornee was appointed Interim Human Resources Director at the beginning of September.
Malin Lindgärde was appointed VP of Marketing and Communications, and took up her position at the beginning of August.
Magnus Eriksson resigned as Doro's CFO at the beginning of September. He will leave his position immediately after publication of the Third-quarter Interim Report on 24 October, but will continue to serve an advisory role within Doro until year-end.
Carl-Johan Zetterberg Boudrie was appointed as Doro's new CFO, effective immediately after publication of the Third-quarter Interim Report on 24 October. He is also retaining his position as Vice President of Doro Care.
Carl-Johan Rijpma was appointed VP Operations and a member of Group Management at the beginning of October. He starts his position November 1.
Total sales per market, R12, October 2016 – September 2017
USA, Canada
| NET SALES PER MARKET* | |||||||
|---|---|---|---|---|---|---|---|
| 1% 14% 19% |
Doro group (SEKm) | 2017 Jul-Sep |
Net sales growth, % |
2016 Jul-Sep recalc. |
2017 Jan-Sep |
2016 Jan-Sep recalc. |
2016 Jan-Dec recalc. |
| 5% | Nordic | 82.2 | -5.7 | 87.2 | 250.5 | 233.4 | 353.1 |
| 14% 22% |
EMEA | 108.9 | -12.5 | 124.4 | 307.1 | 333.9 | 461.4 |
| DACH | 113.5 | -6.5 | 121.4 | 342.9 | 305.7 | 462.9 | |
| 25% | UK | 66.5 | 20.0 | 55.4 | 167.7 | 165.7 | 266.4 |
| US/Canada | 19.7 | -39.9 | 32.8 | 67.7 | 161.7 | 189.8 | |
| Other regions | 4.1 | -8.9 | 4.5 | 13.9 | 12.3 | 18.9 | |
| Nordic | Care | 66.0 | 30.4 | 50.6 | 205.7 | 149.6 | 210.1 |
| Europe, Middle East, Africa | Central overheads | 4.4 | -3.1 | 8.1 | -2.6 | -3.5 | |
| DACH | Total | 465.3 | -1.7 | 473.2 | 1,363.6 | 1,359.7 | 1,959.1 |
* Notes 1, 2 United Kingdom
Sales in the Nordics decreased 5.7 percent in the third quarter. Growth for the nine-month period was 7.3 percent. Based on market data from resellers, our view is that Doro increased market share somewhat on a weak general mobile phone market, partly thanks to a positive product mix. Market share progress for the nine-month period is similar, largely due to a strong first quarter. Other regions
Sales decreased 6.5 percent in DACH in the third quarter, mainly due to lower sales in Germany. Growth for the nine-month period was 12.2 percent. Considering performance was better than the general market for smartphones and feature phones in Germany, our view is that Doro successfully defended its market share in the region.
Sales in the third quarter 2017 decreased 12.5 percent, mainly because of an embargo on mobile phone imports in Algeria, which stopped Doro's sales in the country. The comparative quarter also included a large-scale one-off order in the country. Progress in France was also slow, while growth in countries such as Belgium and Italy was positive.
Sales increased 20 percent in the third quarter 2017, supported by increased marketing efforts and healthy retail sales growth, combined with stable demand for mobile phones. Sales performance by teleoperators contributed to this strong growth, as did product mix with a high share of advanced feature phones and smartphones.
Poor sales performance continued, with a downturn of nearly 40 percent yearon-year. However, the downturn was lower than in the previous, second, quarter. The increase in mobile phone sales throughout 2016 by Doro's operator customers in the region was due to a shift in technology from 2G to 3G throughout 2016. We think the sales downturn has levelled out. We are planning for the next technology generation on the North American market, with the ambition of launching a 4G phone in the second half of 2018.
Care's sales increased by just over 30 percent in the third quarter, and growth for the nine-month period was 37.5 percent. The combination of continued positive sales in Germany and an increase in subscription income in the Nordics were the main contributors to growth in the quarter.
Of Care's total SEK 66.0m income for the quarter, SEK 45.6m was subscription income. This is an increase compared to the third quarter 2016, when subscription income amounted to 35.4m.
At the end of the quarter, the total subscriber base was 125,000, an increase compared to the third quarter 2016, when the subscriber base was nearly 113,000.
Net sales in other regions were SEK 4.1m (4.5).
Income and income adjustments not related to a specific region were SEK 4.4m (-3.1) in the third quarter.
Doro's shares are listed on the Nasdaq Stockholm, Small Cap – Telecom/IT list. As of September 30, 2017, the total amount of shares outstanding was 23 755 255. Shareholders' equity amounted to SEK 557.0m (511.2).
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 444 (492) employees as of September 30, 2017, equivalent to 372 (376) full-time employees. Of these, 245 (260) are based in Sweden, 24 (39) in France, 16 (16) in the UK, 9 (9) in Hong Kong, 89 (107) in Norway, 2 (2) in Italy and 59 (59) in Germany.
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 23 and 24 of the Annual Report, no other material risks were identified in the period.
The Parent Company's net sales for the third quarter amounted to SEK 368.2m (341.3). The profit after tax amounted to SEK 8.4m (16.1).
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.
The evaluation of the potential accounting effect of the new accounting standards IFRS 9 Financial instruments and IFRS 15 Revenue from customer contracts, to be implemented on 1 January 2018, is on-going.
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.
The outlook is unchanged. Our expectation for 2017 is that both sales and EBIT will increase compared to 2016.
The Q4 2018 report will be published on February 15, 2018
This report will be presented via audiocast on October 24 at 9:00 CET
Q4-report January-December 2017: February 15, 2018 Q1-report January-March 2018 April 27, 2018
A Capital Markets Day will be arranged in November 2017, in Stockholm. An invitation will be sent out separately.
The Annual General Meeting 2018 will be held on April 27, 2018.
Robert Puskaric, President and CEO, +46 (0)46 280 50 05 Carl-Johan Zetterberg Boudrie, CFO, +46 (0)46 280 50 47
Analysts, investors and media are welcome to attend a presentation of the Q3 report via https://edge.media-server.com/m6/p/4jf2xtx6 or by telephone at 9:00 CET on October 24, 2017. 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: http://corporate.doro.com/blog/hp-doro-webcast.
| Sweden: | + 46 (0) 8 505 564 74 |
|---|---|
| France: | + 33 (0) 170 750 725 |
| UK: | + 44 (0) 203 364 5374 |
| US: | + 1 855 7532 230 |
Doro develops telecom products and services for Seniors to lead full and rich lives: to do things they want to do more easily as well as the things they thought they might never do. The global market leader in senior mobile phone, Doro offers easy-to-use mobile phones and smart phones, mobile applications, fixed line telephony with loud and clear sound. Within Doro Group, Doro Care offers social care and telecare solutions for elder and disabled persons for independent and safe living in their own homes. Doro AB is a Swedish public company and its shares are quoted on the Nasdaq OMX Stockholm exchange, Nordic List, Small Companies. Net sales of SEK 1 959 million (EUR 205 million) was reported for 2016.
www.doro.com
| Doro Group (SEKm) | 2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Net sales | 465.3 | 473.2 | 1 363.6 | 1 359.7 | 1 959.1 |
| Own work capitalized and other income | 9.1 | 1.0 | 32.0 | 10.6 | 16.0 |
| Operating costs | -436.4 | -441.3 | -1 292.5 | -1 294.1 | -1 853.7 |
| Operating profit/loss before depreciation and write-downs, EBITDA | 38.0 | 32.9 | 103.1 | 76.2 | 121.4 |
| Depreciation according to plan, excluding depreciation of intangible assets related to company acquisitions | -15.4 | -17.0 | -41.6 | -42.5 | -66.3 |
| Operating profit/loss after depreciation and write-downs, EBITA | 22.6 | 15.9 | 61.5 | 33.7 | 55.1 |
| Depreciation according to plan of intangible assets related to company acquisitions | -1.1 | -2.0 | -3.6 | -6.3 | -7.4 |
| Operating profit/loss after depreciation and write-downs, EBIT | 21.5 | 13.9 | 57.9 | 27.4 | 47.7 |
| Net financial items | -0.1 | -0.1 | 0.5 | -4.3 | -8.3 |
| Profit/loss after financial items | 21.4 | 13.8 | 58.4 | 23.1 | 39.4 |
| Taxes | -5.7 | -1.2 | -14.4 | -3.5 | -8.4 |
| Profit/loss for the period | 15.7 | 12.6 | 44.0 | 19.6 | 31.0 |
| Average number of shares, thousands | 23 755 | 23 238 | 23 462 | 23 238 | 23 238 |
| Average number of shares after dilution, thousands* | 23 755 | 23 440 | 23 535 | 23 506 | 23 411 |
| Earnings per share, SEK | 0.66 | 0.54 | 1.88 | 0.84 | 1.33 |
| Earnings per share after dilution, SEK* | 0.66 | 0.54 | 1.87 | 0.83 | 1.32 |
| ) * The effect of dilution is considered only when the effect on earnings per share is negative. |
| STATEMENT OF COMPREHENSIVE INCOME Doro Group (SEKm) |
2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Profit/loss for the period | 15.7 | 12.6 | 44.0 | 19.6 | 31.0 |
| Other comprehensive income to be reclassified to profit or loss in subsequent periods: | |||||
| Translation differences | -1.0 | 4.0 | -2.7 | 6.2 | 4.9 |
| Effects from cash flow hedges | 1.9 | -1.8 | -3.6 | 4.0 | 4.9 |
| Deferred tax | -0.4 | 0.4 | 0.8 | -0.9 | -1.1 |
| Total result related to Parent company's shareholders | 16.2 | 15.2 | 38.5 | 28.9 | 39.7 |
| STATEMENT OVER FINANCIAL POSITION Doro Group (SEKm) |
2017 30 Sep |
2016 30 Sep |
2016 31 Dec |
|---|---|---|---|
| Non-current assets | |||
| Intangible assetsr | 463.7 | 473.1 | 464.1 |
| Property, plant, and equipment | 17.9 | 10.4 | 12.9 |
| Financial assets | 7.1 | 8.2 | 7.3 |
| Deferred tax assets | 12.0 | 20.6 | 11.9 |
| Current assets | |||
| Inventories | 258.8 | 240.0 | 217.9 |
| Current receivables | 383.1 | 428.9 | 512.8 |
| Cash and cash equivalents | 64.4 | 22.9 | 61.0 |
| Total assets | 1 207.0 | 1 204.1 | 1 287.9 |
| Shareholders' equity attributable to Parent company's shareholders | 557.0 | 511.2 | 520.0 |
| Long term liabilities | 164.8 | 192.0 | 197.0 |
| Current liabilities | 485.2 | 500.9 | 570.9 |
| Total shareholders' equity and liabilities | 1 207.0 | 1 204.1 | 1 287.9 |
| Financial instruments recognized at fair value in the Balance sheet, SEKm | 2016 30 Sep |
2016 31 Dec |
|
|---|---|---|---|
| Exchange rate contracts recorded as current liability | 12.8 | 4.4 | 3.2 |
| Exchange rate contracts recorded as current receivable | 5.6 | 7.5 | 12.4 |
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) Note |
2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Operating profit/loss after depreciation and write-downs, EBIT | 21.5 | 13.9 | 57.9 | 27.4 | 47.7 |
| Depreciation according to plan | 16.5 | 19.0 | 45.2 | 48.8 | 73.7 |
| Net financial items | -1.2 | -1.1 | -3.8 | -4.2 | -8.3 |
| Unrealized exchange rate differences in cash flow | 0.5 | -1.9 | 12.6 | 4.3 | -0.6 |
| Taxes paid | -1.2 | -8.1 | -12.3 | -26.8 | -26.3 |
| Changes in working capital (including changes in provisions) | -11.4 | 14.7 | -18.6 | -38.0 | -24.5 |
| Cash flow from current activites | 24.7 | 36.5 | 81.0 | 11.5 | 61.7 |
| Investments in intangible and tangible fixed assets | -18.3 | -17.8 | -49.5 | -48.9 | -67.4 |
| Total free cash flow before acquisitions | 6.4 | 18.7 | 31.5 | -37.4 | -5.7 |
| Acquisitions | 0.0 | 0.0 | 0.0 | -27.9 | -29.0 |
| Cash flow from investing activities | -18.3 | -17.8 | -49.5 | -76.8 | -96.4 |
| Amortization of debt | 0.0 | -36.8 | -50.5 | --59.6 | -79.8 |
| New loans/changes in bank overdraft facility | 0.0 | 5.8 | 25.0 | 100.6 | 129.8 |
| Dividend | 0.0 | 0.0 | -23.2 | 0.0 | 0.0 |
| New share issue | 0.0 | 0.0 | 21.7 | 0.0 | 0.0 |
| Warrant program, new/buy back | 0.0 | 0.0 | -1.2 | 0.3 | -0.6 |
| Cash flow from financing activities | 0.0 | -31.0 | -28.2 | 41.3 | 49.4 |
| Exchange differences in cash and cash equivalents | 0.2 | 1.4 | 0.1 | 2.9 | 2.4 |
| Change in cash and cash equivalents | 6.6 | -10.9 | 3.4 | -21.1 | 17.1 |
| Net debt | 120.6 | 178.6 | 120.6 | 178.6 | 149.5 |
| STATEMENT OF CHANGES IN EQUITY Doro Group (SEKm) |
2017 30 Sep |
2016 30 Sep |
2016 31 Dec |
|---|---|---|---|
| Opening balance | 520.0 | 482.0 | 482.0 |
| Total result related to Parent company shareholders | 38.5 | 28.9 | 39.7 |
| Dividend | -23.2 | 0.0 | 0.0 |
| Warrants | 0.0 | 0.3 | -1.8 |
| New share issue | 21.7 | 0.0 | 0.0 |
| Closing balance | 557.0 | 511.2 | 520.0 |
| Note OTHER KEY FIGURES Doro Group |
2017 30 Sep |
2016 30 Sep |
2016 31 Dec |
|---|---|---|---|
| Orderbook at the end of the period, SEKm 3 |
374.7 | 353.9 | 307.8 |
| Order intake Q, SEKm 3 |
561.4 | 557.9 | 572.3 |
| Gross margin, % | 38.3 | 36.8 | 38.5 |
| Gross marginl Q, % | 37.5 | 39.3 | - |
| Equity/assets ratio, % | 46.1 | 42.5 | 40.4 |
| Number of shares at the end of the period, thousands | 23 755 | 23 238 | 23 238 |
| Number of shares at the end of the period after dilution, thousands* | 23 755 | 23 517 | 23 357 |
| Equity per share, SEK | 23.45 | 22.00 | 22.38 |
| Equity per share, after dilution, SEK* | 23.45 | 21.74 | 22.26 |
| Return on average shareholders' equity, % | 10.4 | 12.9 | 6.2 |
| Return on average capital employed, % | 11.4 | 12.7 | 6.8 |
| Share price at period's end, SEK | 52.50 | 63.00 | 53.00 |
| Market value, SEKm | 1 247.2 | 1 464.0 | 1 231.6 |
* ) The effect of dilution is considered only when the effect on earnings per share is negative.
| SALES PER MARKET*) Doro Group (SEKm) |
2017 Jul-Sep |
2016 Jul-Sep (recalc) |
2017 Jan-Sep |
2016 Jan-Sep (recalc) |
2016 Jan-Dec (recalc) |
|---|---|---|---|---|---|
| Nordic | 82.2 | 87.2 | 250.5 | 233.4 | 353.1 |
| Europe, Middle East and Africa | 108.9 | 124.4 | 307.1 | 333.9 | 461.4 |
| DACH (Germany, Austria, Switzerland and Central Europe) | 113.5 | 121.4 | 342.9 | 305.7 | 462.9 |
| United Kingdom | 66.5 | 55.4 | 167.7 | 165.7 | 266.4 |
| USA and Canada | 19.7 | 32.8 | 67.7 | 161.7 | 189.8 |
| Other regions | 4.1 | 4.5 | 13.9 | 12.3 | 18.9 |
| Care | 66.0 | 50.6 | 205.7 | 149.6 | 210.1 |
| Central overhead | 4.4 | -3.1 | 8.1 | -2.6 | -3.5 |
| Total | 465.3 | 473.2 | 1 363.6 | 1 359.7 | 1 959.1 |
| ) * Note 1, 2 |
| Parent company (SEKm) | 2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Net sales | 368.2 | 341.3 | 1 071.4 | 1 007.8 | 1 439.5 |
| Own work capitalized and other income | 9.6 | -0.5 | 22.4 | 5.3 | 5.7 |
| Operating cost | -349.5 | -305.6 | -1 034.5 | -945.7 | -1 384.6 |
| Operating profit/loss before depreciation and write-downs, EBITDA | 28.3 | 35.2 | 59.3 | 67.4 | 60.6 |
| Depreciation | -18.5 | -16.0 | -44.6 | -39.7 | -58.2 |
| Operating profit/loss after depreciation and write-downs, EBIT | 9.8 | 19.2 | 14.7 | 27.7 | 2.4 |
| Net financial items | 0.9 | 1.0 | 1.6 | -0.8 | -3.7 |
| Profit/loss after financial items | 10.7 | 20.2 | 16.3 | 26.9 | -1.3 |
| Taxes | -2.3 | -4.1 | -4.0 | -5.9 | -0.2 |
| Profit/loss for the period | 8.4 | 16.1 | 12.3 | 21.0 | -1.5 |
| STATEMENT OF COMPREHENSIVE INCOME Parent company (SEKm) |
2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Profit/loss for the period | 8.4 | 16.1 | 12.3 | 21.0 | -1.5 |
| Other comprehensive income to be reclassified to profit or loss | |||||
| Effects from cash flow hedges | 1.9 | -1.8 | -3.6 | 4.0 | 4.9 |
| Deferred tax | -0.4 | 0.4 | 0.8 | -0.9 | -1.1 |
| Total Result related to Parent company shareholders | 9.9 | 14.7 | 9.5 | 24.1 | 2.3 |
| STATEMENT OF FINANCIAL POSITION Parent company (SEKm) Note |
2017 30 sep |
2016 30 sep |
2016 31 dec |
|---|---|---|---|
| Non-current assets | |||
| Intangible assets | 282.0 | 59.4 | 52.0 |
| Property, plant, and equipment | 11.9 | 1.0 | 0.8 |
| Financial assets | 124.2 | 347.3 | 347.5 |
| Current assets | |||
| Inventories | 193.0 | 158.7 | 130.5 |
| Current receivables | 497.6 | 439.2 | 574.1 |
| Cash and cash equivalents | 53.1 | 4.0 | 43.4 |
| Total assets | 1 161.8 | 1 009.6 | 1 148.3 |
| Shareholders' equity attributable to Parent company's shareholders | 388.5 | 395.1 | 373.2 |
| Provisions | 63.0 | 73.5 | 74.9 |
| Long term liabilities | 130.0 | 150.0 | 160.0 |
| Current liabilities | 580.3 | 391.0 | 540.2 |
| Total shareholders' equity and liabilities | 1 161.8 | 1 009.6 | 1 148.3 |
Effective 1 January 2017, Doro altered the definition of its markets, so reporting is consistent with how sales are organised. This means sales are divided into geographical regions, with Doro Care as a separate region. The comparative figures for 2016 have been restated to comply with this new reporting method.
| Sales per market Doro Group (SEKm) |
2016 Jan-Mar recalc. |
2016 Apr-Jun recalc. |
2016 Jul-Sep recalc. |
2016 Oct-Dec recalc. |
2016 Jan-Dec recalc. |
|---|---|---|---|---|---|
| Nordic | 57.9 | 88.3 | 87.2 | 119.7 | 353.1 |
| Europe, Middle East and Africa | 106.8 | 102.7 | 124.4 | 127.5 | 461.4 |
| DACH (Germany, Austria, Switzerland and Central Europe) | 86.6 | 97.7 | 121.4 | 157.2 | 462.9 |
| United Kingdom | 60.7 | 49.6 | 55.4 | 100.7 | 266.4 |
| USA and Canada | 53.9 | 74.9 | 32.8 | 28.2 | 189.8 |
| Other regions | 6.3 | 1.5 | 4.5 | 6.6 | 18.9 |
| Care | 39.4 | 59.6 | 50.6 | 60.5 | 210.1 |
| Central overhead | 1.4 | -0.8 | -3.1 | -1.0 | -3.5 |
| Total | 413.0 | 473.5 | 473.2 | 599.4 | 1 959.1 |
Effective 1 January 2017, Doro reports the period's recurring revenue. Earlier, Doro reported forward looking 12 months recurring revenue on current subscriptions. The comparative figures for 2016 have been restated to comply with this new reporting method.
| Recurring revenue Doro Group (SEKm) |
2016 Jan-Mar recalc. |
2016 Apr-Jun recalc. |
2016 Jul-Sep recalc. |
2016 Oct-Dec recalc. |
2016 Jan-Dec recalc. |
|---|---|---|---|---|---|
| Recurring revenue | 17.2 | 33.3 | 35.4 | 38.8 | 124.7 |
Order book and order intake for the third quarter 2016 has been adjusted to include the order book and order intake for Trygghetssentralen AS. Compared to the interim report for the third quarter 2016, the order book has been increased by SEK 43.0m and the order intake by SEK 10.1m.
| Gross Margin | Net sales - Merchandise costs |
|---|---|
| Gross Margin, % | Gross Margin in percentage of Net sales |
| Average number of shares | Number of shares at the end of each period divided with number of periods. |
| 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 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 |
Actual number of shares at the end of the period. |
| 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. |
| Equity/assets ratio, % | Shareholders' equity as a percentage of the balance sheet total. |
| Return on average shareholders' equity, % |
Profit/Loss rolling twelve months after financial items and tax divided by average shareholders' equity. |
| Capital employed | Total assets reduced with non-interest-bearing debt and cash and bank balances. |
| Return on average capital employed, % |
Operating profit/loss rolling twelve months, divided by the quarterly average capital employed excluding cash and bank balances. |
| Share price at period's end | Closing market price at the end of the period. |
| Market value, SEK m | Share price at period's end times 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 the 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 Merchandise costs in percentage of Net Sales. |
Gross Margin is an important measure for showing the margin before Personnel expenses and 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 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 reduced with 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 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. |
| Recurring revenue | Net Sales during the quarter from existing recurring agreements. |
The measure shows revenues during the quarter from recurring agreements. |
| 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 that are not defined in IFRS |
2017 Jul-Sep |
2016 Jul-Sep |
2017 Jan-Sep |
2016 Jan-Sep |
2016 Jan-Dec |
|---|---|---|---|---|---|
| Currency adjusted sales growth (SEKm) | |||||
| Currency adjusted sales growth | -3.8 | 33.4 | |||
| Currency effect | -4.1 | -5.1 | |||
| Reported sales growth | -7.9 | 28.3 | |||
| Capital employed | |||||
| Total assets | 1 207.0 | 1 204.1 | 1 287.9 | ||
| -non-interest-bearing liabilities | 462.6 | 460.6 | 533.5 | ||
| -cash and bank | 64.4 | 22.9 | 61.0 | ||
| Reported capital employed | 680.0 | 720.6 | 693.4 |
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.
Lund, Sweden, October 24, 2017
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 at page 8, at 08:00 CET on October 24, 2017.
Doro AB (publ) company identity no 556161-9429
We have reviewed the condensed interim financial information (interim report) of Doro AB (publ) as of 30 September 2017 and the nine-month period then ended. The board of directors and the CEO are responsible for the preparation and presentation of the interim financial information 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 Report Performed by the Independent Auditor 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. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, regarding the Group, and with the Swedish Annual Accounts Act, regarding the Parent Company.
Malmö, 24th October, 2017 PricewaterhouseCoopers AB
Magnus Willfors Johan Rönnbäck Auditor in charge
Authorized Public Accountant Authorized Public Accountant
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