Quarterly Report • Nov 24, 2016
Quarterly Report
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Net sales Q2
EBIT Q2 SEK 153 m
| 2016/17 | 2015/16 | 2016/17 | 2015/16 | |
|---|---|---|---|---|
| Aug-Oct | Aug-Oct | May-Oct | May-Oct | |
| 3 mths | 3 mths | 6 mths | 6 mths | |
| Net sales, SEK m. | 1,769.2 | 1,624.4 | 3,415.1 | 3,187.5 |
| Growth, % | 8.9 | 4.5 | 7.1 | 8.1 |
| Operating profit, SEK m | 153.2 | 134.3 | 286.2 | 251.7 |
| Operating margin, % | 8.7 | 8.3 | 8.4 | 7.9 |
| Profit after tax, SEK m | 115.2 | 85.7 | 214.8 | 166.5 |
| Earnings per share, SEK | 2.22 | 1.65 | 4.13 | 3.20 |
| Operating cash flow per share, SEK | 3.22 | 2.34 | 5.41 | 3.28 |
In the second quarter, organic growth was recorded at 4,8 percent, while profit again improved compared with a year earlier. The restructuring programme, launched in June, is under way and the effects are starting to show through. The annual cost saving from the programme as a whole is calculated at SEK 45 million, with full impact emerging inside two years. Adjusted operating profit for the quarter amounted to SEK 162.4 million and operating margin was 9.2 percent (8.3) .
The second quarter is normally our strongest period of the year. The market as a whole moved in a positive direction in the quarter. The Nordic market remains buoyant, as do several markets in Western Europe. The USA continued to perform strongly, partly under the influence of a stronger USD. For the first time in a good while Region Eastern Europe reported stabilized sales. Most notably, the decline in Russia has been slowed. In the Other markets region, a very slight decline was evident as a result of lower orders in the Middle East compared to the previous year when a large order was delivered.
The restructuring programme is under way in the parts of the Group concerned. The programme is focused on the business area for air conditioning, acquired in recent years, and some loss-making units in various countries. The programme consists of capacity adjustments and review of product ranges. The cost of the programme will rise to in all approximately SEK 45 million, with estimated annual cost savings of SEK 45 million and full impact within two years. The cost thus far totals SEK 11 million, of which SEK 9 million arose in the second quarter.
In August, we acquired the Czech group 2VV, a leading maker of industrial and residential air handling units, as well as air curtains. The acquisition creates opportunities for product and manufacturing synergies in our European units. Integration of the company is going ahead on schedule. Also, our acquisition of German air curtain maker TTL has gone ahead in line with expectations.
Our investment in a new factory in Turkey will provide us with a larger production facility at lower cost.
In Skinnskatteberg in Sweden, a major investment in machinery, intended to improve productivity in sheet metal forming is also nearing completion.
Growth is buoyant in several of our markets, although we would have liked to see stronger growth in parts of Western Europe and recovery in Russia. The actions we have planned to increase profit are in full swing.
One of Systemair's strengths is our global presence. On that basis, we can utilise our resources and our market presence to identify and develop the applications and opportunities that emerge. We will also continue to make acquisitions and invest in production equipment, product development and marketing in order to maintain our growth.
Roland Kasper President and CEO
Group sales for the second quarter of the 2016/17 financial year totalled SEK 1,769.2 million (1,624.4), an increase of 8.9 percent from the same period in the preceding year.
Adjusted for both foreign exchange effects and acquisitions, net sales grew 4.8 percent. Growth in acquired operations was 3.0 percent, while foreign exchange effects increased sales by 1.1 percent during the period.
During the second quarter, sales in the Nordic region were up 11 percent on the same period in the preceding year. The Danish, Norwegian and Finnish markets continue to perform strongly. Adjusted for foreign exchange effects, sales rose by 8 percent.
Sales in the West European market grew 12 percent during the quarter, compared with the corresponding period in the preceding year. Adjusted for foreign exchange effects and acquisitions, sales rose by 7 percent. Several markets in the region performed well during the period, for example Spain, France, and Italy.
Sales in Eastern Europe and the CIS increased 2 percent during the quarter. Adjusted for the effects of foreign exchange and acquisitions, sales declined 3 percent. In Russia, sales decreased by 6 percent during the period, stated in Swedish kronor. The Russian market accounted for 5 percent of Systemair's total sales in the first halfyear, compared with 7 percent in the previous year.
Sales in the North and South America region during the quarter were 21 percent higher than in the same period in the preceding year. The American market grew strongly during the quarter, and it is especially major projects in air handling units for classrooms that contribute to the increase. Adjusted for foreign exchange effects and acquisitions, sales rose by 16 percent.
Sales in Other markets declined 1 percent during the quarter compared with the same period in the preceding year. Adjusted for the effects of foreign exchange and acquisitions, sales declined 2 percent. The Turkish market performed well during the quarter, while sales decreased in China, Dubai, Qatar and India. In the Middle East, above all, single projects may have considerable impact on a particular quarter.
| 2016/17 Aug-Oct 3 mths |
2015/16 Aug-Oct 3 mths |
Sales – change |
Of which organic |
2016/17 May-Oct 6 mths |
2015/16 May-Oct 6 mths |
Sales – change |
Of which, organic |
|
|---|---|---|---|---|---|---|---|---|
| Nordic region | 440.8 | 397.0 | 11% | 8% | 769.2 | 722.5 | 6% | 6% |
| Western Europe | 694.2 | 622.1 | 12% | 7% | 1,369.9 | 1,248.7 | 10% | 7% |
| Eastern Europe & the CIS |
256.1 | 251.0 | 2% | -3% | 482.7 | 531.0 | -9% | -9% |
| North and South America |
148.3 | 122.8 | 21% | 16% | 317.0 | 270.5 | 17% | 14% |
| Other markets | 229.8 | 231.5 | -1% | -2% | 476.3 | 414.8 | 15% | 17% |
| Total | 1,769.2 | 1,624.4 | 9% | 5% | 3,415.1 | 3,187.5 | 7% | 6% |
(Sales figures are based on geographical domicile of customers.)
Net sales
Systemair AB Interim report Q2 2016/17 3(15)
The gross profit for the second quarter was SEK 623.4 million (574.3), an increase of 8.6 percent over the same period in the preceding year. The gross margin decreased to 35.2 percent (35.4). On a full-year basis, the gross margin improved from 34.8 percent to 35.0 percent.
The operating profit for the second quarter totalled SEK 153.2 million (134.3), up 14.1 percent on the same period in the preceding year. The Company's operating margin was 8.7 percent (8.3). Adjusted for the restructuring programme operating profit for the quarter amounted SEK 162.4 million and operating margin was 9.2 percent.
Selling and administration expenses for the quarter totalled SEK 459.3 million (431.3), a rise of SEK 28.0 million. 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 16.1 million, or 3.5 percent.
Selling expenses were charged with SEK 4.4 million (3.7) for anticipated and confirmed impairment losses on trade receivables. During the quarter, costs related to acquisitions totalled SEK 0.1 million. Restructuring costs
relating to the SEK 45 million programme launched in the 2015/16 financial year totalled SEK 9.2 million in the period.
Net financial items ended the second quarter at SEK +3.2 million (-15.6). The effects of foreign exchange on long-term receivables, loans and bank balances was SEK +8.9 million (-10.4) net. Interest expenses for the quarter totalled SEK -5.2 million (-5.5).
Estimated tax for the quarter totalled SEK -41.2 million (-33.0), corresponding to an effective tax rate of 26.3 percent based on profit after net financial items.
In August, Systemair acquired the Czech corporate group 2VV, a leading developer and manufacturer of industrial and residential air handling units. The company also manufacture air curtains for commercial applications in the region. The company, which has 189 employees, is based in Pardubice, 120 km east of Prague. In 2015, the company reported sales of around EUR 18 million.
In September, Systemair acquired the assets of TTL Tür + Torluftschleier Lufttechnische Geräte GmbH, a German manufacturer of high-quality air curtains for commercial applications. TTL, based in Winterbach, west of Stuttgart, reports sales of around EUR 4 million. In addition to the company's assets, Systemair also took over 24 employees and TTL's 4,000 m2leased factory and office building.
If the companies acquired had been consolidated as of 1 May 2016, net sales for the period May through October 2016 would have totalled approximately SEK 3,490.0 million. The operating profit for that period would have totalled approximately SEK 157.1 million. Note 1 in this report contains and acquisition analysis and the effects of the acquisitions on the Group's cash and cash equivalents.
Investments for the quarter, excluding divestments, totalled SEK 140.1 million (84.1), including SEK 25.3 million (52.7) in new construction and machinery. Investments consisted primarily of capacity and replacement investments at a number of factories. Acquisitions and formerly withheld additional purchase considerations totalled SEK 113.6 million (32.7) for the quarter. Depreciation of non-current assets amounted to SEK 45.8 million (44.6).
The average number of employees in the Group was 4,707 (4,559). At the end of the period, Systemair had 5,049 employees (4,699), 350 more than one year previous. New employees were recruited chiefly at Systemair in Turkey (59), Germany (33), Sweden (26) and Canada (25). Personnel cutbacks were made at Menerga in Germany (-21), Russia (-35) and India (-38). Through company acquisitions, 223 employees joined the Group, including 13 at Menerga, Poland, 189 at 2VV, Czech Republic and 21 at TTL, Germany.
Cash flow from operating activities before changes in working capital totalled SEK 166.6 million (135.4) for the quarter. Changes in working capital had a positive impact of SEK 0.8 million (-13.6) on cash flow. Cash flow from financing operations totalled SEK -55.5 million (-3.3) net. At the end of the period, the Group's net indebtedness was SEK 1,476.3 million (1,345.7). The consolidated equity/assets ratio was 43.8 percent (42.8) 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 2015/16 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 36 to the accounts in the Annual Report for the 2015/16 financial year. During the period, no change worthy of mention occurred in the scale of these transactions.
Parent Company net sales for the financial year totalled SEK 47.2 million (45.1). Operating profit was negative, at SEK -58.7 million (-25.3). The company had 44 (41) employees. The core business of the Parent Company is that of intra-Group services.
Systemair is a leading ventilation company with operations in 49 countries in Europe, North America, South America, the Middle East, Asia and Africa. The company had sales of approximately SEK 6.1 billion in the 2015/16 financial year and approximately 5,000 employees. Systemair has reported an operating profit every year since 1974, when the company was founded. During the past 15 years, the Company's growth rate has averaged about 12 percent.
Systemair has well-established operations in growth markets. The group's products are marketed under the Systemair, Frico, VEAB, Fantech, Menerga and Holland Heating 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 is to be submitted for publication at 8.00 a.m. on 24 November 2016.
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, 23 November 2016 Systemair AB (publ)
| Roland Kasper | Gerald Engström |
|---|---|
| Chief Executive Officer | Chairman of the Board |
| Carina Andersson | Svein Nilsen |
| Board member | Board member |
| Per-Erik Sandlund | Patrik Nolåker |
| Board member | Board member |
| Åke Henningsson | Ricky Sten |
| Employee Representative | Employee Representative |
Interim report Q3 2016/17 8.00 a.m., 23 February 2017
Year-end report Q4 2016/17 8.00 a.m., 8 June 2017
Interim report Q1 2017/18 1.00 p.m., 24 August 2017
President and CEO Roland Kasper Telephone: +46 (0)222-440 13, +46 (0)730 94 40 13 E-mail: [email protected]
Chairman of the Board Gerald Engström Telephone: +46 (0)705-19 00 01 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)222-44 000 [email protected] www.systemair.com.
Systemair has received an order for ventilation units, with a value of EUR 1.2 million, from the University Clinic of Navarra. With a total area of 45, 000 m2 it is one of the most significant health care project in Spain. Systemair in Spain will deliver 86 DV devices between November 2016 and January 2017.
Systemair AB Interim report Q2 2016/17 7(15)
We have reviewed the condensed interim financial information (interim report) for Systemair AB (Publ) as per 31 October 2016 and the six-month reporting period ending on that date. The preparation and fair presentation of the interim report in accordance with IAS 34 and the Annual Accounts Act are the responsibility of the Board of Directors and the Chief Executive Officer. Our responsibility is to express our opinion of 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. As our opinion is based on a review, the level of assurance is not as high as that of an opinion expressed based on an audit.
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, 23 November 2016 Ernst & Young AB
Åsa Lundvall Authorised Public Accountant
| Parent | ||||||||
|---|---|---|---|---|---|---|---|---|
| Group | Company | |||||||
| SEK m | 2016/17 Aug-Oct 3 mths |
2015/16 Aug-Oct 3 mths |
2016/17 May-Oct 6 mths |
2015/16 May-Oct 6 mths |
2016/17 Nov–Oct trl 12 |
2015/16 May-Apr 12 mths |
2016/17 May-Oct 6 mths |
2015/16 May-Oct 6 mths |
| Net sales | 1,769.2 | 1,624.4 | 3,415.1 | 3,187.5 | 6,340.1 | 6,112.5 | 47.2 | 45.1 |
| Cost of goods sold | -1,145.8 | -1,050.1 | -2,218.4 | -2,077.0 | -4,151.8 | -4,010.4 | - | - |
| Gross profit | 623.4 | 574.3 | 1,196.7 | 1,110.5 | 2,188.3 | 2,102.1 | 47.2 | 45.1 |
| Other operating income | 24.7 | 20.8 | 46.1 | 38.9 | 87.5 | 80.3 | 2.4 | 0.4 |
| Selling expenses | -372.6 | -348.4 | -715.4 | -683.1 | -1,432.1 | -1,399.8 | -20.0 | -28.1 |
| Administration expenses | -86.7 | -82.9 | -169.0 | -162.3 | -343.8 | -337.1 | -41.5 | -30.1 |
| Other operating expenses | -35.6 | -29.5 | -72.2 | -52.3 | -121,3 | -101.4 | -46.8 | -12.6 |
| Operating profit | 153.2 | 134.3 | 286.2 | 251.7 | 378.6 | 344.1 | -58.7 | -25.3 |
| Net financial items | 3.2 | -15.6 | 5.5 | -21.5 | -9.7 | -36.8 | 289.8 | 526.1 |
| Profit after financial items | 156.4 | 118.7 | 291.7 | 230.2 | 368.9 | 307.3 | 231.1 | 500.8 |
| Appropriations | - | - | - | - | - | - | -3.3 | 25.5 |
| Tax on profit for the period | -41.2 | -33.0 | -76.9 | -63.7 | -113.4 | -100.1 | 8.6 | -2.0 |
| Profit for the period 1 | 115.2 | 85.7 | 214.8 | 166.5 | 255.5 | 207.2 | 236.4 | 524.3 |
| Earnings per share, SEK 2 | 2.22 | 1.65 | 4.13 | 3.20 | 4.91 | 3.98 | - | - |
| Profit for the period Other comprehensive income Items that have been, or may later be, transferred to profit for the year: |
115.2 | 85.7 | 214.8 | 166.5 | 255.5 | 207.2 | 236.4 | 524.3 |
|---|---|---|---|---|---|---|---|---|
| Translation differences | 66.9 | -44.6 | 139.6 | -43.9 | 97.7 | -85.9 | 1.8 | -1.5 |
| Impact of tax | -0.2 | 0.3 | -0.4 | 0.3 | -0.2 | 0.5 | -0.4 | 0.3 |
| Items that cannot be transferred to profit for the year: |
||||||||
| Revaluation of defined-benefit pensions, net after tax |
- | - | - | - | 8.2 | 8.2 | - | - |
| Other comprehensive income | 66.7 | -44.3 | 139.2 | -43.6 | 105.7 | -77.2 | 1.4 | -1.2 |
| Total comprehensive income for the period1 |
181.9 | 41.4 | 354.0 | 122.9 | 361.2 | 130.0 | 237.8 | 523.1 |
1) Attributable in entirety to Parent Company shareholders.
2) No dilution effect arises since the options programme in operation has been arranged by Färna Invest.
| Group | Parent Company | ||||
|---|---|---|---|---|---|
| SEK m | 31/10/2016 | 31/10/2015 | 30/04/2016 | 31/10/2016 | 31/10/2015 |
| ASSETS | |||||
| Goodwill | 723.6 | 642.2 | 621.8 | 0.3 | 0.5 |
| Other intangible assets | 192.7 | 205.4 | 189.3 | 3.1 | 3.2 |
| Property, plant and equipment | 1,395.2 | 1,294.1 | 1,273.6 | 14.0 | 5.0 |
| Financial and other assets | 199.8 | 175.2 | 180.5 | 2,350.4 | 2,120.3 |
| Total non-current assets | 2,511.3 | 2,316.9 | 2,265.2 | 2,367.8 | 2,129.0 |
| Inventory | 1,150.1 | 1,030.5 | 1,105.1 | - | - |
| Current receivables | 1,499.8 | 1,323.5 | 1,255.2 | 1,211.2 | 1,151.3 |
| Cash and cash equivalents | 229.3 | 242.3 | 176.9 | - | - |
| Total current assets | 2,879.2 | 2,596.3 | 2,537.2 | 1,211.2 | 1,151.3 |
| TOTAL ASSETS | 5,390.5 | 4,913.2 | 4,802.4 | 3,579.0 | 3,280.3 |
| EQUITY AND LIABILITIES | |||||
| Equity | 2,358.2 | 2,101.1 | 2,108.2 | 1,983.4 | 1,845.5 |
| Untaxed reserves | - | - | - | 5.5 | 12.9 |
| Non-current liabilities, non-interest-bearing | 242.0 | 252.6 | 238.7 | - | - |
| Non-current liabilities, interest-bearing | 416.3 | 251.9 | 196.7 | 460.4 | 282.1 |
| Total non-current liabilities | 658.3 | 504.5 | 435.4 | 460.4 | 282.1 |
| Current liabilities, interest-bearing | 1,231.7 | 1,262.8 | 1,309.0 | 1,073.2 | 1,094.8 |
| Current liabilities, non-interest-bearing | 1,142.3 | 1,044.8 | 949.8 | 56.5 | 45.0 |
| Total current liabilities | 2,374.0 | 2,307.6 | 2,258.8 | 1,129.7 | 1,139.8 |
| TOTAL EQUITY AND LIABILITIES | 5,390.5 | 4,913.2 | 4,802.4 | 3,579.0 | 3,280.3 |
| 2016/17 | 2015/16 | 2016/17 | 2015/16 | 2015/16 | |
|---|---|---|---|---|---|
| Aug-Oct | Aug-Oct | May-Oct | May-Oct | May-Apr | |
| SEK m | 3 mths | 3 mths | 6 mths | 6 mths | 12 mths |
| Operating profit | 153.2 | 134.3 | 286.2 | 251.7 | 344.1 |
| Adjustment for non-cash items | 66.3 | 30.0 | 112.6 | 69.5 | 143.8 |
| Financial items | -5.8 | -5.1 | -11.3 | -9.7 | -18.9 |
| Income tax paid | -47.1 | -23.8 | -70.8 | -45.9 | -138.8 |
| Cash flow from operating activities before changes in | 166.6 | 135.4 | 316.7 | 265.6 | 330.2 |
| working capital | |||||
| Changes in working capital | 0.8 | -13.6 | -35.2 | -95.1 | -161.3 |
| Cash flow from operating activities | 167.4 | 121.8 | 281.5 | 170.5 | 168.9 |
| Cash flow from investing activities | -132.5 | -82.2 | -158.7 | -126.0 | -212.1 |
| Cash flow from financing activities | -55.5 | -3.3 | -93.1 | 25.3 | 53.5 |
| Cash flow for the period | -20.6 | 36.3 | 29.7 | 69.8 | 10.3 |
| Cash and cash equivalents at start of period | 236.6 | 214.6 | 176.9 | 187.8 | 187.8 |
| Translation differences, cash and cash equivalents | 13.3 | -8.6 | 22.7 | -15.3 | -21.2 |
| Cash and cash equivalents at close of period | 229.3 | 242.3 | 229.3 | 242.3 | 176.9 |
| 2016/17 May-Oct |
2015/16 May-Oct |
2015/16 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 | 2,108.2 | 2,108.2 | 2,082.2 | 2,082.2 | 2,082.2 | 2,082.2 | |
| Dividend | -104.0 | -104.0 | -104.0 | -104.0 | -104.0 | -104.0 | |
| Comprehensive income | 354.0 | 354.0 | 122.9 | 122.9 | 130.0 | 130.0 | |
| Amount at end of period | 2,358.2 | 2,358.2 | 2,101.1 | 2,101.1 | 2,108.2 | 2,108.2 |
| 2016/17 | 2015/16 | 2016/17 | 2015/16 | 2015/16 | ||
|---|---|---|---|---|---|---|
| Aug-Oct | Aug-Oct | May-Oct | May-Oct | May-Apr | ||
| 3 mths | 3 mths | 6 mths | 6 mths | 12 mths | ||
| Net sales | SEK m | 1,769.2 | 1,624.4 | 3,415.1 | 3,187.5 | 6,112.5 |
| Growth | % | 8.9 | 4.5 | 7.1 | 8.1 | 3.9 |
| Operating profit | SEK m | 153.2 | 134.3 | 286.2 | 251.7 | 344.1 |
| Operating margin | % | 8.7 | 8.3 | 8.4 | 7.9 | 5.6 |
| Profit after net fin. items | SEK m | 156.4 | 118.7 | 291.7 | 230.2 | 307.3 |
| Profit margin | % | 8.8 | 7.3 | 8.5 | 7.2 | 5.0 |
| Return on capital employed | % | 10.5 | 10.5 | 10.5 | 10.5 | 10.2 |
| Return on equity | % | 11.6 | 11.4 | 11.6 | 11.4 | 9.8 |
| Equity/assets ratio | % | 43.8 | 42.8 | 43.8 | 42.8 | 43.9 |
| Investments | SEK m | 132.5 | 82.2 | 158.7 | 126.0 | 212.1 |
| Depreciation/Amortisation | SEK m | 45.8 | 44.6 | 89.9 | 88.6 | 178.2 |
| Per share ratios | ||||||
| Earnings per share | SEK | 2.22 | 1.65 | 4.13 | 3.20 | 3.98 |
| Equity per share | SEK | 45.35 | 40.40 | 45.35 | 40.40 | 40.54 |
| Operating cash flow per share | SEK | 3.22 | 2.34 | 5.41 | 3.28 | 3.25 |
| No. of shares at end of period | No. | 52,000,000 | 52,000,000 | 52,000,000 | 52,000,000 | 52,000,000 |
| 2016/17 2015/16 |
2014/15 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 1,769.2 | 1,645.9 | 1,508.7 | 1,416.3 | 1,624.4 | 1,563.1 | 1,502.4 | 1,431.6 | 1,554.5 |
| Growth | % | 8.9 | 5.3 | 0.4 | -1.1 | 4.5 | 12.1 | 19.4 | 10.3 | 9.9 |
| Gross margin | % | 35.2 | 34.8 | 34.1 | 33.7 | 35.4 | 34.3 | 33.5 | 33.6 | 36.6 |
| Operating profit | SEK m | 153.2 | 133.0 | 62.2 | 30.1 | 134.3 | 117.5 | 55.1 | 54.1 | 156.3 |
| Operating margin | % | 8.7 | 8.1 | 4.1 | 2.1 | 8.3 | 7.5 | 3.7 | 3.8 | 10.1 |
| Return on capital | ||||||||||
| employed | % | 10.5 | 10.1 | 10.2 | 9.3 | 10.5 | 12.4 | 12.5 | 19.8 | 18.9 |
| Return on equity | % | 11.6 | 10.6 | 9.8 | 9.9 | 11.4 | 13.0 | 15.1 | 27.4 | 27.2 |
| Equity/assets ratio | % | 43.8 | 45.0 | 43.9 | 43.6 | 42.8 | 44.9 | 44.4 | 46.4 | 44.1 |
| Basic equity per share | SEK | 45.35 | 43.85 | 40.54 | 39.74 | 40.40 | 41.61 | 40.04 | 39.64 | 38.66 |
| Basic earnings per share | SEK | 2.22 | 1.91 | 0.53 | 0.25 | 1.65 | 1.55 | 0.56 | 0.84 | 2.24 |
| Cash flow from operating | ||||||||||
| activities per share | SEK | 3.22 | 2.19 | -0.77 | 0.74 | 2.34 | 0.94 | -0.25 | 1.49 | 1.71 |
Systemair applies International Financial Reporting Standards (IFRS), as adopted by EU. 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 purchase consideration for the shares in the 2VV Group of the Czech Republic and for the assets of TTL of Germany may perliminary be divided as follows:
Total historical cost, less transaction costs SEK 123.4 million
| Identifiable net assets | Total |
|---|---|
| Goodwill | 50.9 |
| Brands and customer relationships | 7.4 |
| Buildings and land | 22.5 |
| Machinery and equipment | 40.4 |
| Financial and other current assets | 1.6 |
| Inventory | 33.4 |
| Current receivables | 23.3 |
| Other current assets | 9.1 |
| Cash and cash equivalents | 2.6 |
| Non-interest-bearing liabilities (incl. deferred tax liability) | -1.9 |
| Interest-bearing liabilities | -31.8 |
| Other operating liabilities | -34.1 |
| 123.4 |
Transaction costs in the acquisition of subsidiaries totalled SEK 0.1 million.
The total effect on cash flow from the acquisitions, including payment of a formerly withheld purchase consideration for prior years' acquisitions, amounted to SEK -113.9 million. A non-interest-bearing non-current liability relating to the estimated withheld purchase consideration for the above-mentioned acquisitions totals SEK 7.0 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 receivables, cash and cash equivalents, available-for-sale financial assets, trade payables, 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-for-sale 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.
From the start of the 2016/17 financial year, Systemair is aggregating on the basis of the geographical segments Europe and Rest of the World. The market segment Europe accounts for the major share of Systemair's business. Overall, 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 merged. 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 to be merged on the basis of their legal domicile, and consolidation will take place according to the same principles as for the Group as a whole.
| 2016/17 | 2015/16 | 2016/17 | 2015/16 | |
|---|---|---|---|---|
| SEK m | Aug-Oct 3 mths |
Aug-Oct 3 mths |
May-Oct 6 mths |
May-Oct 6 mths |
| Europe | ||||
| Net sales, external | 1,436.7 | 1,355.9 | 2,730.5 | 2,621.1 |
| Net sales, intra-Group | 36.0 | 39.1 | 86.4 | 78.4 |
| Operating profit | 164.3 | 138.0 | 297.8 | 246.6 |
| Operating margin, % | 11.4 | 10.2 | 10.9 | 9.4 |
| Assets | 2,655.5 | 2,458.7 | 2,655.5 | 2,458.7 |
| Investments | 13.0 | 38.5 | 29.7 | 70.5 |
| Depreciation/Amortisation | 39.2 | 38.6 | 76.6 | 76.7 |
| Rest of World | ||||
| Net sales, external | 332.5 | 268.5 | 684.6 | 566.4 |
| Net sales, intra-Group | 3.1 | 6.2 | 8.4 | 13.4 |
| Operating profit | 16.8 | 8.1 | 46.9 | 30.3 |
| Operating margin, % | 5.1 | 3.0 | 6.9 | 5.3 |
| Assets | 855.4 | 677.5 | 855.4 | 677.5 |
| Investments | 2.5 | 11.0 | 6.9 | 21.4 |
| Depreciation/Amortisation | 5.7 | 5.1 | 11.4 | 10.3 |
| Group-wide | ||||
| Net sales, intra-Group | 23.3 | 21.9 | 47.2 | 45.1 |
| Operating profit | -27.9 | -11.8 | -58.5 | -25.2 |
| Assets | 3,584.8 | 3,285.8 | 3,584.8 | 3,285.8 |
| Investments | 117.0 | 32.7 | 122.1 | 34.1 |
| Depreciation/Amortisation | 0.9 | 0.9 | 1.9 | 1.6 |
| Eliminations | ||||
| Net sales, intra-Group | -15.1 | -22.0 | -94.7 | -91.7 |
| Assets | -1,705.2 | -1,508.8 | -1,705.2 | -1,508.8 |
| Total | ||||
| Net sales, external | 1,769.2 | 1,624.4 | 3,415.1 | 3,187.5 |
| Operating profit | 153.2 | 134.3 | 286.2 | 251.7 |
| Operating margin, % | 8.7 | 8.3 | 8.4 | 7.9 |
| Assets | 5,390.5 | 4,913.2 | 5,390.5 | 4,913.2 |
| Investments | 132.5 | 82.2 | 158.7 | 126.0 |
| Depreciation/Amortisation | 45.8 | 44.6 | 89.9 | 88.6 |
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 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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