Quarterly Report • Jul 18, 2017
Quarterly Report
Open in ViewerOpens in native device viewer
| Q2 | Q2 | H1 | H1 | LTM | FY | |
|---|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 |
| Net sales | 3,949 | 3,461 | 7,393 | 6,460 | 13,321 | 12,388 |
| EBITDA | 729 | 646 | 1,224 | 1,119 | 1,976 | 1,871 |
| % of net sales | 18.5% | 18.7% | 16.6% | 17.3% | 14.8% | 15.1% |
| Operating profit (EBIT) | 650 | 573 | 1,067 | 973 | 1,667 | 1,573 |
| % of net sales | 16.5% | 16.6% | 14.4% | 15.1% | 12.5% | 12.7% |
| Operating profit (EBIT) before items affecting comparability | 650 | 584 | 1,067 | 984 | 1,704 | 1,621 |
| % of net sales | 16.5% | 16.9% | 14.4% | 15.2% | 12.8% | 13.1% |
| Profit for the period | 474 | 453 | 770 | 748 | 1,384 | 1,362 |
| Earnings per share, SEK | 1.60 | 1.53 | 2.60 | 2.53 | 4.68 | 4.60 |
| Cash flow for the period | -29 | 309 | -412 | -107 | 445 | 750 |
| Operating cash flow⁽¹⁾ | 570 | 511 | 526 | 410 | 1,412 | 1,296 |
| Core working capital | 3,304 | 2,953 | 3,304 | 2,953 | 3,304 | 2,655 |
| Capital expenditure in fixed assets | -71 | -44 | -134 | -97 | -262 | -225 |
| RoOC | 32.4% | 33.4% | 32.4% | 33.4% | 32.4% | 31.6% |
⁽¹⁾Net cash flow from operations after investments in fixed assets and excluding income tax paid.
Net sales (SEK million)
We can conclude a strong second quarter, driven by strong execution on internal initiatives as well as favorable market conditions. We continue to show good organic growth of 9% out of the total 14%. Underlying profitability developed well, with an EBIT margin of 17.2% (16.9%) if excluding costs related to the class action legal activities in the US.
Americas reported a strong quarter with organic sales growth of 11%. It's very encouraging to see good results from local initiatives. The effort to close the gap in growth to the American RV market is one of the initiatives that have yielded result. Another contributor to improved profitability is higher efficiency in our logistics.
EMEA reported good organic sales growth of 8% and demand remained strong in most European businesses. After the somewhat weak margin in the first quarter, we are working with a set of initiatives to improve profitability in the region, especially in the RVOEM business.
In APAC, we continue to see stable performance in Australia, as well as high growth rates in China and Japan. Profitability remains on a high level but was slightly impacted by unfavorable product and country mix.
Cash generation was strong in the quarter and leverage is now at 1.7, which creates a good platform for continued M&A activities. I am pleased to see that the integration of Oceanair and IPV goes according to plan. Finding more acquisition growth opportunities in attractive business segments is a top priority.
The last year's efforts to improve logistics and distribution have yielded good results in both Americas and EMEA. Another focus area right now is to manage a combination of productivity improvements and optimizing manufacturing capacities in a high demand situation. All regions have action plans, one example being the recently announced consolidation in China.
All in all, we summarize a strong first half of 2017. The outlook for our businesses remains unchanged and we have a full pipeline of activities to take us to our financial targets.
Roger Johansson, President and CEO
Net sales in the three months ending June 30, 2017, totaled SEK 3,949 million, representing an increase of 14% compared with SEK 3,461 million in the same period last year. This is made up of 9% organic growth, 4% currency translation and 1% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 650 million in Q2 2017, which was an increase of 11% compared to SEK 584 million in Q2 2016. The EBIT margin decreased from 16.9% to 16.5%. Earnings for Q2 2017 include SEK 29 million relating to class action legal costs.
Financial items amounted to a net expense of SEK 32 million (39), including SEK 25 million in interest on external bank loans (30) and SEK 2 million for amortization of capitalized long-term financing expenses (2). Other expense items amounted to SEK 6 million (9) and financial income to SEK 1 million (2).
Taxes totaled SEK -144 million (-81), corresponding to 23% (15%) of profit before tax. Current tax amounted to SEK -44 million (-61) and deferred tax to SEK -100 million (-20).
Profit for the period totaled SEK 474 million (453).
Earnings per share amounted to SEK 1.60 (1.53).
Operating cash flow totaled SEK 570 million (511). The improvement derives from stronger operating profit and a reduction in inventory.
Cash flow for the period of SEK -29 million (309), including cash payment of dividend for 2016 of SEK 547 million.
Financial position. Leverage in Q2 2017 was 1.7 compared with 2.1 in Q2 2016. At year-end 2016, leverage was 1.7.
Net sales totaled SEK 7,393 million, representing an increase of 14% compared with SEK 6,460 million in the same period last year. This is made up of 10% organic growth, 4% currency translation and 0% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 1,067 million, which was an increase of 8% compared to SEK 984 million 2016. The EBIT margin decreased from 15.2% to 14.4%. Earnings for H1 2017 include SEK 75 million relating to rebranding costs, class action legal costs and an acquisition-related cost.
Financial items amounted to a net expense of SEK 63 million (73), including SEK 51 million in interest on external bank loans (60) and SEK 4 million for amortization of capitalized long-term financing expenses (4). Other expense items amounted to SEK 9 million (12) and financial income to SEK 1 million (3).
Taxes totaled SEK -234 million (-152), corresponding to 23% (17%) of profit before tax. Current tax amounted to SEK -95 million (-116) and deferred tax to SEK -139 million (-36).
Profit for the period totaled SEK 770 million (748).
Earnings per share amounted to SEK 2.60 (2.53).
Operating cash flow totaled SEK 526 million (410). The improvement derives from stronger operating profit and a reduction in inventory.
Cash flow for the period of SEK -412 million (-107) includes purchase price paid net of acquired cash and cash equivalents of SEK187 million for the acquisitions in Q1 and cash dividend payout for 2016 of SEK 547 million in Q2 2017.
Events after the quarter. Dometic divested an industrial facility in China. Selling price amounted to CNY 160 million. Net gain of CNY 80 -100 million.
Roger Johansson, President and CEO, announced that he will leave his position at the end of the year. The Board has appointed Juan Vargues as his successor.
| Q2 | Q2 | Change (%) | H1 | H1 | Change (%) | LTM | FY | |||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | Rep. | Adj.⁽¹⁾ | 2017 | 2016 | Rep. | Adj.⁽¹⁾ | 2017 | 2016 |
| Americas | 1,692 | 1,527 | 11% | 6% | 3,198 | 2,967 | 8% | 3% | 5,980 | 5,749 |
| EMEA | 1,833 | 1,552 | 18% | 14% | 3,360 | 2,774 | 21% | 18% | 5,679 | 5,093 |
| Asia Pacific | 424 | 382 | 11% | 5% | 835 | 719 | 16% | 9% | 1,662 | 1,546 |
| Total net sales | 3,949 | 3,461 | 14% | 10% | 7,393 | 6,460 | 14% | 10% | 13,321 | 12,388 |
| Americas | 274 | 244 | 12% | 7% | 438 | 432 | 1% | -4% | 762 | 756 |
| EMEA | 277 | 246 | 12% | 8% | 439 | 389 | 13% | 9% | 584 | 534 |
| Asia Pacific | 99 | 94 | 5% | 1% | 190 | 163 | 16% | 11% | 358 | 331 |
| Total operating profit (EBIT)⁽²⁾ | 650 | 584 | 11% | 7% | 1,067 | 984 | 8% | 4% | 1,704 | 1,621 |
| Americas | 16.2% | 16.0% | 13.7% | 14.5% | 12.7% | 13.1% | ||||
| EMEA | 15.1% | 15.9% | 13.1% | 14.0% | 10.3% | 10.5% | ||||
| Asia Pacific | 23.3% | 24.5% | 22.8% | 22.7% | 21.6% | 21.4% | ||||
| Total operating profit % | 16.5% | 16.9% | 14.4% | 15.2% | 12.8% | 13.1% |
⁽¹⁾Represents change in comparable currency. ⁽²⁾Before i.a.c.
Q2
NET SALES
OPERATING PROFIT (EBIT)¹
274 SEK MILLION (244)
OPERATING MARGIN (EBIT%)¹
¹ Before i.a.c.
Americas reported net sales of SEK 1,692 million (1,527), representing 43% of Group sales. Total growth was 11%, of which 11% was organic, 5% currency translation and -5% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 274 million (244), an increase of 12% compared to the same period in 2016. The EBIT margin was 16.2% (16.0%).
Net sales for the first half of the year amounted to SEK 3,198 million (2,967), an increase of 8%, of which 7% was organic, 5% currency translation and -4% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 438 million (432), a decrease of 4% compared to the same period in 2016. The EBIT margin was 13.7% (14.5%).
In the US, growth in the volume of RV shipments from OEM manufacturers to dealers remains strong. For the January–May 2017 period, RV shipments increased by 12% compared with the same period last year. For the March–May period, RV shipments increased by 14% compared to the same period last year.
OEM sales growth was 5% in constant currency, while organic growth was 11%. Aftermarket sales growth was 8% in constant currency and organic growth was 11%.
RVOEM reported strong development, with 12% sales growth excluding divestments. The gap to market is narrowing, driven by strong sales of refrigerators and air conditioners.
The Marine OEM business reported good growth, based on favorable market conditions.
CPVOEM business sales declined. The US truck market remains challenging.
Aftermarket grew in all businesses. There was particularly strong growth in Mobile cooling.
Q2
NET SALES
OPERATING PROFIT (EBIT)¹
277 SEK MILLION (246)
OPERATING MARGIN (EBIT%)¹
¹ Before i.a.c.
Second quarter 2017
EMEA reported net sales of SEK 1,833 million (1,552), representing 46% of Group sales. Total growth was 18%, of which 8% was organic, 3% currency translation and 7% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 277 million (246); an increase of 12% compared to the same period in 2016. The EBIT margin was 15.1% (15.9%).
Net sales for the first half of the year amounted to SEK 3,360 million (2,774), an increase of 21%, of which 13% was organic, 3% currency translation and 5% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 439 million (389), an increase of 13% compared to the same period in 2016. The EBIT margin was 13.1% (14.0%).
For the January–June 2017 period, RV registrations in the largest European markets increased by 10% compared with the same period last year. For the April– June period, RV registrations increased by 12% compared to the same period last year.
For the January–May period, heavy truck registrations increased by 4% compared to the same period last year.
OEM sales growth was 21% in constant currency, while organic sales growth totaled 15%. Aftermarket sales growth was 10% in constant currency and organic sales growth was 3%.
RVOEM reported good sales growth across all markets and product groups.
Marine OEM reported strong sales growth in Italy, France and the UK. UK Marine OEM sales were further enhanced by the addition of Oceanair in Q1, 2017.
CPVOEM reported sales growth driven by product groups such as inverters, cooling boxes and rear-view cameras.
Aftermarket sales performed well, except for aircon service stations where growth was somewhat lower than for the corresponding period last year.
Q2
NET SALES
SEK MILLION (382)
OPERATING PROFIT (EBIT)¹ 99
SEK MILLION (94)
OPERATING MARGIN (EBIT%)¹
¹ Before i.a.c.
Second quarter 2017
APAC reported net sales of SEK 424 million (382), representing 11% of Group sales. Total growth was 11%, of which 6% was organic, 5% currency translation and 0% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 99 million (94); an increase of 5% compared to the same period in 2016. The EBIT margin was 23.3% (24.5%).
Net sales for the first half of the year amounted to SEK 835 million (719); an increase of 16%, of which 10% was organic, 6% currency translation and 0% M&A.
Operating profit (EBIT) before i.a.c. totaled SEK 190 million (163); an increase of 16% compared to the same period in 2016. The EBIT margin was 22.8% (22.7%).
Statistics on Australian domestic RV production showed an increase of 1% to 8,866 units during the January–May period, compared with the same period the previous year. For the March–May period, RV production increased by 3% compared to the same period last year.
OEM sales growth was 6% in constant currency. Aftermarket sales growth was 5% in constant currency.
RVOEM reported stable sales development with growth in Australia and New Zealand, despite persistently sluggish local markets. Sales to RVOEM customers in China and Japan showed double-digit growth.
Marine OEM had a challenging quarter with slightly negative development, mainly due to the timing of projects.
CPVOEM reported healthy growth, driven by strong sales of inverters to customers in China.
Aftermarket showed strong development in the RV, CPV and lodging segments, compensating for slightly negative development in the retail segment.
The Parent Company Dometic Group AB (publ) comprises the functions of the Group's head office, such as Group-wide management and administration. The Parent Company invoices its costs to Group companies.
For the second quarter 2017, the Parent Company had an operating profit (loss) of SEK 5 million (-5), including administrative expenses of SEK 32 million (34) and other operating income of SEK 37 million (29), of which the full amount relates to income from Group companies.
Profit (loss) from financial items totaled SEK 113 million (- 139), including interest income from Group companies of SEK 4 million (16), interest expenses to Group companies of SEK 0 million (0) and other financial income and expenses SEK 109 million (-155).
Profit (loss) for the second quarter amounted to SEK -15 million (-144).
The Parent Company's operating profit (loss) for the first half of the year totaled SEK 2 million (-5), including administrative expenses of SEK 68 million (61) and other operating income of SEK 70 million (56), of which the full amount relates to income from Group companies.
Profit (loss) from financial items totaled SEK 128 million (- -116), including interest income from Group companies of SEK 28 million (19), interest expenses to Group companies of SEK - million (0) and other financial income and expenses SEK 100 million (-135).
Profit (loss) for the first half year amounted to SEK -3 million (-122).
For further information, please refer to the Parent Company's condensed financial statements on page 12.
The Board of Directors and the President and CEO certify that the Interim Report gives a true and fair overview of the Parent Company's operations, their financial position and results of operations, and describes the significant risks and uncertainties facing the Parent Company and other companies in the Group.
Solna July 18, 2017
Fredrik Cappelen Chairman of the Board
Rainer E. Schmückle Board member
Magnus Yngen Board member
Peter Sjölander Board member
Heléne Vibbleus Board member
Jacqueline Hoogerbrugge Board member
Erik Olsson Board member
Roger Johansson President and CEO
This interim report has not been subject to special review by the Dometic Group AB (publ)'s external auditor.
| Q2 | Q2 | H1 | H1 | FY | |
|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2016 |
| Net sales | 3,949 | 3,461 | 7,393 | 6,460 | 12,388 |
| Cost of goods sold | -2,637 | -2,309 | -4,996 | -4,397 | -8,463 |
| Gross Profit | 1,312 | 1,152 | 2,397 | 2,063 | 3,925 |
| Sales expenses | -458 | -420 | -909 | -790 | -1,651 |
| Administrative expenses | -170 | -133 | -359 | -271 | -604 |
| Other operating income and expenses | -17 | 2 | -27 | 16 | 20 |
| Items affecting comparability | 0 | -11 | 0 | -11 | -48 |
| Amortization of customer relationships | -17 | -17 | -35 | -34 | -69 |
| Operating profit | 650 | 573 | 1,067 | 973 | 1,573 |
| Financial income | 1 | 2 | 1 | 3 | 6 |
| Financial expenses | -33 | -41 | -64 | -76 | -124 |
| Loss from financial items | -32 | -39 | -63 | -73 | -118 |
| Profit before tax | 618 | 534 | 1,004 | 900 | 1,455 |
| Taxes | -144 | -81 | -234 | -152 | -93 |
| Profit for the period | 474 | 453 | 770 | 748 | 1,362 |
| Profit for the period attributable to owners of the Parent Company | 474 | 453 | 770 | 748 | 1,362 |
| Earnings per share before and after dilution effects, SEK - Owners of the Parent Company |
1.60 | 1.53 | 2.60 | 2.53 | 4.60 |
| Number of shares, million | 295.8 | 295.8 | 295.8 | 295.8 | 295.8 |
| Q2 | Q2 | H1 | H1 | FY | |
|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2016 |
| Profit for the period | 474 | 453 | 770 | 748 | 1,362 |
| Other comprehensive income | |||||
| Items that will not be reclassified subsequently to profit or loss: | |||||
| Remeasurements of defined benefit pension plans, net of tax | -1 | 0 | -3 | -3 | -16 |
| -1 | 0 | -3 | -3 | -16 | |
| Items that may be reclassified subsequently to profit or loss: | |||||
| Cash flow hedges, net of tax | -11 | 9 | -7 | -10 | 13 |
| Gains/losses from hedges of net investments in foreign operations, | |||||
| net of tax | 57 | -30 | 41 | -53 | -149 |
| Exchange rate differences on translation of foreign operations | -440 | 327 | -405 | 278 | 887 |
| -394 | 306 | -371 | 215 | 751 | |
| Other comprehensive income for the period | -395 | 306 | -374 | 212 | 735 |
| Total comprehensive income for the period | 79 | 759 | 396 | 960 | 2,097 |
| Total comprehensive income for the period attributable to owners of the Parent Company |
79 | 759 | 396 | 960 | 2,097 |
| Jun 30, | Jun 30, | Dec 31, | |
|---|---|---|---|
| SEK million | 2017 | 2016 | 2016 |
| ASSETS | |||
| Non-current assets | |||
| Goodwill and trademarks | 12,486 | 12,170 | 12,725 |
| Other intangible assets | 975 | 1,039 | 1,016 |
| Tangible assets | 1,575 | 1,564 | 1,575 |
| Deferred tax assets | 1,062 | 1,072 | 1,226 |
| Derivatives, long-term | 3 | 12 | 7 |
| Other non-current assets | 56 | 48 | 52 |
| Total non-current assets | 16,157 | 15,905 | 16,601 |
| Current assets | |||
| Inventories | 2,697 | 2,452 | 2,637 |
| Trade receivables | 1,915 | 1,632 | 1,041 |
| Current tax assets | 53 | 13 | 47 |
| Derivatives, short-term | 37 | – | 57 |
| Other current assets | 286 | 228 | 237 |
| Prepaid expenses and accrued income | 99 | 88 | 89 |
| Cash and cash equivalents | 1,169 | 730 | 1,599 |
| Total current assets | 6,256 | 5,143 | 5,707 |
| TOTAL ASSETS | 22,413 | 21,048 | 22,308 |
| EQUITY AND LIABILITIES EQUITY |
13,826 | 12,840 | 13,977 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Liabilities to credit institutions, long-term | 4,205 | 4,347 | 4,453 |
| Deferred tax liabilities | 593 | 561 | 593 |
| Other non current liabilities | 16 | – | – |
| Provisions for pensions | 534 | 495 | 536 |
| Other provisions, long-term | 124 | 106 | 117 |
| Total non-current liabilities | 5,472 | 5,509 | 5,699 |
| Current liabilities | |||
| Liabilities to credit institutions, short-term | 339 | 273 | 329 |
| Trade payables | 1,308 | 1,131 | 1,024 |
| Current tax liabilities | 336 | 246 | 294 |
| Advance payments from customers | 20 | 16 | 29 |
| Derivatives, short-term | 38 | 35 | 52 |
| Other provisions, short-term | 206 | 218 | 197 |
| Other current liabilities | 211 | 201 | 134 |
| Accrued expenses and prepaid income | 657 | 579 | 573 |
| Total current liabilities | 3,115 | 2,699 | 2,632 |
| TOTAL LIABILITIES | 8,587 | 8,208 | 8,331 |
| TOTAL EQUITY AND LIABILITIES | 22,413 | 21,048 | 22,308 |
| Other paid in | Retained | ||||
|---|---|---|---|---|---|
| SEK million | Share capital | capital ⁽¹⁾ | Reserves | earnings | Total equity |
| Opening balance Jan 1, 2016 | 1 | 11,446 | 1,004 | -568 | 11,883 |
| Profit for the period | 748 | 748 | |||
| Other comprehensive income | |||||
| Remeasurements of defined benefit pension plans, net of tax | -3 | -3 | |||
| Cash flow hedges, net of tax | -10 | -10 | |||
| Gains/losses from hedges of net investments in foreign operations, net of tax |
-53 | -53 | |||
| Exchange rate differences on translation of foreign operations | 278 | 278 | |||
| Total comprehensive income | 215 | 745 | 960 | ||
| Transactions with owners | |||||
| Costs related to the shareholders´ contribution, net of tax | -3 | -3 | |||
| Total transactions with owners | -3 | -3 | |||
| Closing balance Jun 30, 2016 | 1 | 11,446 | 1,219 | 174 | 12,840 |
⁽¹⁾ Shareholders´contribution reclassified from retained earnings to other paid in capital SEK 11,446 million, has been done as an opening balance sheet adjustment as per January 1, 2016.
| Other paid in | Retained | ||||
|---|---|---|---|---|---|
| SEK million | Share capital | capital ⁽¹⁾ | Reserves | earnings | Total equity |
| Opening balance Jan 1, 2017 | 1 | 11,446 | 1,755 | 775 | 13,977 |
| Profit for the period | 770 | 770 | |||
| Other comprehensive income | |||||
| Remeasurements of defined benefit pension plans, net of tax | -3 | -3 | |||
| Cash flow hedges, net of tax | -7 | -7 | |||
| Gains/losses from hedges of net investment in foreign operations, net of | |||||
| tax | 41 | 41 | |||
| Exchange rate differences on translation of foreign operations | -405 | -405 | |||
| Total comprehensive income | -371 | 767 | 396 | ||
| Transactions with owners | |||||
| Dividend to shareholders | -547 | -547 | |||
| Total transactions with owners | -547 | -547 | |||
| Closing balance Jun 30, 2017 | 1 | 11,446 | 1,384 | 995 | 13,826 |
| Q2 | Q2 | H1 | H1 | FY | |
|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2016 |
| Cash flow from operations | |||||
| Operating profit | 650 | 573 | 1,067 | 973 | 1,573 |
| Adjustment for other non-cash items | |||||
| Depreciation and amortization | 79 | 73 | 157 | 146 | 298 |
| Adjustments for other non-cash items | -2 | 24 | -2 | 35 | 68 |
| Changes in working capital | |||||
| Changes in inventories | 14 | -73 | -117 | -235 | -364 |
| Changes in trade receivables | -255 | -211 | -893 | -700 | -83 |
| Changes in trade payables | 100 | 59 | 323 | 186 | 43 |
| Changes in other working capital | 55 | 110 | 125 | 102 | -14 |
| Income tax paid | -44 | -40 | -39 | -65 | -107 |
| Net cash flow from operations | 597 | 515 | 621 | 442 | 1,414 |
| Cash flow from investments | |||||
| Acquisition of operations | – | – | -187 | – | – |
| Investments in fixed assets | -71 | -44 | -134 | -97 | -225 |
| Proceeds from sale of fixed assets | 1 | 0 | 1 | 1 | 133 |
| Other investing activities | -1 | 0 | -2 | -1 | – |
| Net cash flow from investments | -71 | -44 | -322 | -97 | -92 |
| Cash flow from financing | |||||
| Shareholders´contribution/Paid costs related to the shareholders´ | |||||
| contribution | – | – | – | -74 | -74 |
| Borrowings from credit institutions | 36 | 25 | 36 | 25 | 64 |
| Repayment of loans to credit institutions | -5 | -132 | -117 | -325 | -426 |
| Paid interest | -25 | -57 | -51 | -59 | -97 |
| Received interest | 1 | 1 | 1 | 1 | 3 |
| Other financing activities | -15 | 1 | -33 | -20 | -42 |
| Dividend | -547 | – | -547 | – | – |
| Net cash flow from financing | -555 | -162 | -711 | -452 | -572 |
| Cash flow for the period | -29 | 309 | -412 | -107 | 750 |
| Cash and cash equivalents at beginning of period | 1,213 | 413 | 1,599 | 833 | 833 |
| Exchange differences on cash and cash equivalents | -15 | 8 | -18 | 4 | 16 |
| Cash and cash equivalents at end of period | 1,169 | 730 | 1,169 | 730 | 1,599 |
| Q2 | Q2 | H1 | H1 | FY | |
|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2016 |
| Administrative expenses | -32 | -34 | -68 | -61 | -130 |
| Other operating income | 37 | 29 | 70 | 56 | 127 |
| Operating profit | 5 | -5 | 2 | -5 | -3 |
| Interest income subsidiaries | 4 | 16 | 28 | 19 | 71 |
| Interest expenses subsidiaries | 0 | 0 | – | 0 | – |
| Other financial income and expenses | 109 | -155 | 100 | -135 | -422 |
| Profit (loss) from financial items | 113 | -139 | 128 | -116 | -351 |
| Group contributions | -133 | – | -133 | – | 353 |
| Profit (loss) before tax | -15 | -144 | -3 | -121 | -1 |
| Taxes | 0 | 0 | 0 | -1 | 0 |
| Profit (loss) for the period | -15 | -144 | -3 | -122 | -1 |
Linjal tabell helsida, 100% upplösning
| Jun 30, | Jun 30, | Dec 31, | |
|---|---|---|---|
| SEK million | 2017 | 2016 | 2016 |
| ASSETS | |||
| Shares in subsidiaries | 13,563 | 13,563 | 13,563 |
| Other non-current assets | 16 | 11 | 17 |
| Total non-current assets | 13,579 | 13,574 | 13,580 |
| Current assets | 2,070 | 2,478 | 2,745 |
| TOTAL ASSETS | 15,649 | 16,052 | 16,325 |
| EQUITY | 11,028 | 11,457 | 11,579 |
| PROVISIONS | |||
| Provisions | 14 | 10 | 13 |
| Total provisions | 14 | 10 | 13 |
| LIABILITIES | |||
| Non-current liabilities | 4,205 | 4,347 | 4,453 |
| Total non-current liabilities | 4,205 | 4,347 | 4,453 |
| Current liabilities | 402 | 238 | 280 |
| Total current liabilities | 402 | 238 | 280 |
| TOTAL EQUITY AND LIABILITIES | 15,649 | 16,052 | 16,325 |
Dometic Group AB (publ) ("Dometic") applies International Financial Reporting Standards (IFRS), as adopted by the EU. This consolidated Interim Financial Report has been prepared in accordance with IAS 34 'Interim Financial Reporting'. The Swedish Annual Accounts Act and RFR 2 Accounting for Legal Entities, issued by the Swedish Financial Reporting Board, have been applied for the Parent Company. The interim report comprises pages 1-16 and pages 1-7 are thus an integrated part of this financial report (IAS 34.16A).
The accounting principles applied correspond to those described in the 2016 Annual Report. There are no changes to Dometic's accounting and valuation principles compared with principles described in Notes 2 and 4 of the 2016 Annual Report. For a detailed description of the accounting and valuation principles applied by the Group, see Notes 1, 2 and 4 of the 2016 Annual Report, available at www.dometic.com.
The following information should be considered in addition to the description of the new accounting standards and related activities provided in the 2016 Annual Report, Note 2.
IFRS 9 Financial instruments; the work with the credit loss model is still ongoing. The extent to which IFRS 9 affects Dometic's financial reporting will be determined in 2017. IFRS 15 Revenue from Contracts with Customers; at present the Group is working with the data collection in order to meet the disclosure requirements. IFRS 16 Leases. Currently Dometic is assessing the impact from the new standard, at this stage the Group is not able to quantify the impact on Group financial consolidated statements.
IFRS 9 (Financial Instruments) and IFRS 15 (Revenue from Contracts with Customers) are to be applied from the financial year beginning January 1, 2018, while IFRS 16 (Leases) is effective as of January 1, 2019. Earlier application is permitted for all standards. Dometic will not apply earlier adoption.
As all businesses, Dometic is exposed to a number of risks that could have a material impact on the Group. These risks are factors that impact Dometic's ability to achieve established Group targets. This applies to both financial targets and targets in other areas outlined in Dometic's business strategy. Dometic performs annual risk analysis by assessing each defined risks likelihood and impact in a risk register, resulting in global and regional risk maps presented to Group management and the Board of Directors and used as foundation for the control activities within Dometic. The risks that Dometic is exposed to are classified into four main categories (business and market risks, operational risks, compliance and regulatory risks and financial risks) where each category has underlying risks. These risks can be both internal and external. The internal risks are mainly managed and controlled by Dometic whereas the external risk factors are not caused nor can be controlled by Dometic but the effects can be limited by an effective risk management.
Dometic is subject to transaction risks at the time of purchasing and selling, as well as when conducting financial transactions.
Transaction exposure is primarily related to the currencies EUR, USD and AUD. As the majority of the Group's profit is generated outside Sweden, the Group is also exposed to translational risks in all the major currencies.
Efficient risk management is a continual process conducted within the framework of business control, and is part of the ongoing review of operations and forward-looking assessment of operations. In the preparation of financial reports, the Board of Directors and Group management are required to make estimates and judgments. These estimates and judgments impact the income statement and balance sheet, as well as the disclosures. The actual outcome may differ from these estimates and judgments under different circumstances and conditions.
Dometic's future risk exposure is assumed not to deviate from the inherent exposure associated with Dometic's ongoing business operations. For a more in-depth analysis of risks and risk management, please refer to Dometic's 2016 Annual Report.
Dometic uses interest rate swaps to hedge senior facility term loans to move from a floating interest rate to a fixed interest rate. The Group also uses currency forward agreements to hedge part of its cash flow exposure. Valuation principles and principles for hedge accounting, as described in Note 3 of the 2016 Annual Report, have been applied throughout the reporting period.
The fair values of Dometic's derivative assets and liabilities were SEK 40 million (Q2 2016: SEK 12 million) and SEK 38 million, (Q2 2016: SEK 35 million).The value of derivatives is based on published prices in an active market. No transfers between levels of the fair value hierarchy have occurred during the period.
For financial assets and liabilities other than derivatives, fair value is assumed to be equal to the carrying amount.
| Jun 30, 2017 | Balance sheet carrying amount |
Financial instruments at amortized cost |
Financial instruments at fair value |
Derivatives used for hedging |
|---|---|---|---|---|
| Per category | ||||
| Derivatives | 40 | – | 1 | 39 |
| Financial assets | 3,426 | 3,426 | – | – |
| Total financial assets | 3,466 | 3,426 | 1 | 39 |
| Derivatives | 38 | – | 3 | 35 |
| Financial liabilities | 6,063 | 6,063 | – | – |
| Total financial liabilities | 6,101 | 6,063 | 3 | 35 |
| Q2 | Q2 | H1 | H1 | FY | ||
|---|---|---|---|---|---|---|
| SEK million | 2017 | 2016 | 2017 | 2016 | 2016 | |
| Net sales, external | ||||||
| Americas | 1,692 | 1,527 | 3,198 | 2,967 | 5,749 | |
| EMEA | 1,833 | 1,552 | 3,360 | 2,774 | 5,093 | |
| Asia Pacific | 424 | 382 | 835 | 719 | 1,546 | |
| Total net sales, external | 3,949 | 3,461 | 7,393 | 6,460 | 12,388 | |
| Operating profit (EBIT) | ||||||
| Americas | 274 | 212 | 438 | 400 | 698 | |
| EMEA | 277 | 267 | 439 | 410 | 550 | |
| Asia Pacific | 99 | 94 | 190 | 163 | 325 | |
| Total operating profit (EBIT) | 650 | 573 | 1,067 | 973 | 1,573 | |
| Financial income | 1 | 2 | 1 | 3 | 6 | |
| Financial expenses | -33 | -41 | -64 | -76 | -124 | |
| Taxes | Linjal tabell helsida, 100% upplösning | -144 | -81 | -234 | -152 | -93 |
| Profit for the period | 474 | 453 | 770 | 748 | 1,362 |
Segment performance is primarily assessed based on sales and operating profit. Information regarding income for each region is based on where customers are located. Management follow-up is based on the integrated result in each segment. For further information, please refer to Note 5 of the 2016 Annual Report. Linjal tabell helsida, 100% upplösning
No transactions between Dometic and related parties that have significantly affected the company's position and earnings took place during the first half of the year 2017.
Dometic has not made any acquisitions or divestments that have had a significant impact on Dometic.
On December 22, 2016, Dometic announced the acquisition of the assets of IPV, a Germany-based aftermarket provider of coolers and other outdoor products. The acquisition strengthens Dometic's position in the EMEA market for mobile coolers. The purchase price was EUR 3.5 million, and the transaction was closed on January 3, 2017.
On February 7, 2017, Dometic acquired Oceanair Marine Limited, a UK-based market-leading manufacturer of marine blinds, screens and soft-furnishings for the Leasure Marine and Super Yacht segments. The acquisition strengthens Dometic's
presence in the marine market and broadens the product portfolio. The company reported revenues of GBP 11.4 million for the 2015/2016 fiscal year. The initial purchase price was GBP 14.0 million in cash, with an additional earn-out consideration of a maximum of GBP 2.5 million subject to the achievement of certain performance-related targets over the next 16 months.
Intangible assets recognized as a result of the acquisition of Oceanair include goodwill of SEK 80 million, other intangible assets (trademarks and customer relationships) totaling SEK 102 million, and SEK 20 million in deferred tax liabilities. Acquisitionrelated costs expensed in the consolidated income statement remain the same as in Q1 2017, SEK 2.5 million.
The total purchase price consideration in cash for the transactions (IPV, Oceanair), less cash and cash equivalents, amounts to SEK 187 million. The acquisitions did not have any significant impact on operating profit for the first half of 2017.
As announced on July 13, Dometic divested an industrial facility in China. Selling price amounted to CNY 160 million. Net gain of CNY 80 -100 million will be recognized in the third quarter 2017.
Roger Johansson, President and CEO, announced that he will leave his position at the end of the year. The Board has appointed Juan Vargues as his successor.
Dometic presents some financial measures in this interim report, which are not defined by IFRS. The company believes that these measures provide valuable additional information to investors and management for evaluating the company's financial performance, financial position and trends in our operations. It should be noted that these measures, as defined, may not be comparable to similarly titled measures used by other companies. These non-IFRS measures should not be considered as substitutes for financial reporting measures prepared in accordance with IFRS. See Dometic's website www. dometic.com for the detailed reconciliation.
Consists of inventories and trade receivables less trade payables.
Earnings before Interest, Taxes, Depreciation and Amortization
EBITDA margin
EBITDA divided by net sales
Net debt excluding pensions and accrued interest in relation to EBITDA.
Total borrowings including pensions and accrued interest less cash and cash equivalents.
EBITDA +/- change in working capital excluding paid tax, after capital expenditure.
Sales growth excluding acquisitions/divestments and currency translation effects. Quarters calculated at comparable currency, applying latest period average rate.
Operating profit (EBIT) divided by operating capital. Based on the operating profit (EBIT) for the four previous quarters, divided by the average operating capital for the previous four quarters, excluding goodwill and trademarks for the previous quarter
Aftermarket.
Expenses related to the purchase of tangible and intangible assets.
Commercial and Passenger Vehicles.
Net profit for the period divided by average number of shares.
Financial Year ended December 31, 2016
Represents income and expenses related to non-recurring events, occurring on an irregular basis and affecting comparability between the periods.
Liabilities to credit institutions plus liabilities to related parties plus provisions for pensions.
Other comprehensive income.
Original Equipment Manufacturers.
Interest-bearing debt plus equity less cash and cash equivalents, excluding goodwill and trademarks.
Operating profit; earnings before financial items and taxes.
Operating profit divided by net sales.
Recreational Vehicles.
April to June 2017 for Income Statement.
April to June 2016 for Income Statement.
Core working capital plus other current assets less other current liabilities and provisions relating to operations.
Analysts and media are invited to participate in a telephone conference at 10.00 (CEST), today, July 18, 2017, during which President and CEO, Roger Johansson and CFO, Per-Arne Blomquist, will present the report and answer questions. To participate in the webcast/telephone conference, please dial in five minutes prior to the start of the conference call:
| Sweden: | +46 (0)8 566 426 69 |
|---|---|
| UK: | +44 (0)20 300 898 08 |
| US: | +1 855 831 59 48 |
Webcast URL and presentation are available at www.dometic.com
Johan Lundin Head of Investor Relations and Communications Phone: +46 8 501 025 46 E-mail: [email protected]
This information is information that Dometic Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08:00 CET on July 18, 2017.
SE-171 54 Solna, Sweden Phone: +46 8 501 025 00
Corporate registration number 556829-4390
Dometic is a global market leader in branded solutions for mobile living in the areas of Climate, Hygiene & Sanitation and Food & Beverage. Dometic operates in the Americas, EMEA and Asia Pacific, providing products for use in recreational vehicles, trucks and premium cars, pleasure and workboats, and for a variety of other uses. Dometic offers products and solutions that enrich people's experiences away from home, whether in a motorhome, caravan, boat or truck. Our motivation is to create smart and reliable products with outstanding design. We operate 22 manufacturing/assembly sites in nine countries, sell our products in approximately 100 countries and manufacture approximately 85% of products sold in-house. We have a global distribution and dealer network in place to serve the aftermarket. Dometic employs approximately 6,500 people worldwide, had net sales of SEK 12.4 billion in 2016 and is headquartered in Stockholm, Sweden.
OCTOBER 24, 2017 Interim report, January – September 2017 This document is a translation of the Swedish version of the interim report. In the event of any discrepancy, the Swedish wording shall prevail.
FEBRUARY 8, 2018 Year-end report, 2017
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.