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Beijer Alma

Quarterly Report Oct 23, 2013

3006_10-q_2013-10-23_d1f2c0dc-5525-46ba-adb9-a54fd9ca9602.pdf

Quarterly Report

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Interim report January-September 2013

Improved quarterly earnings

  • Net revenues amounted to MSEK 753 (652) for the third quarter and MSEK 2,293 (2,101) for January-September.
  • Profit after net financial items totaled MSEK 100.3 (76.1) for the third quarter and MSEK 288.3 (266.8) for January-September.
  • Earnings per share amounted to SEK 2.55 (1.84) for the third quarter and SEK 7.32 (6.46) for January-September.
  • Cash flow excluding corporate acquisitions totaled MSEK 80 (91) for the third quarter and MSEK 209 (222) for January-September.
  • The balance sheet remained strong and the net debt/equity ratio was 11.6 percent (8.8).

CEO's comments

The recovery that began in the second quarter continued and strengthened during the third quarter. This improvement was particularly evident in Lesjöfors, which primarily benefitted from strong demand in Chassis Springs. Habia also reported growth, while Beijer Tech experienced somewhat weaker sales than in the year-earlier period. The Group's total invoicing amounted to MSEK 753, up 15 percent year-on-year. In comparable units, invoicing increased 8 percent. This higher invoicing volume contributed to strong earnings and margin trends. Profit after net financial items totaled MSEK 100, up 32 percent compared with the corresponding period in the preceding year. The operating margin increased from 12.2 percent to 13.7 percent. Both Lesjöfors and Habia contributed to the positive margin trend. Cash flow remained strong and amounted to MSEK 80 for the quarter, which resulted in net debt declining to MSEK 178. The strong balance sheet will provide the Group with excellent opportunities to grow organically and through acquisitions.

Lesjöfors experienced a strong trend during the quarter. The order backlog rose and invoicing increased by 28 percent to MSEK 423. In comparable units, the rate of growth was 20 percent. Lesjöfors experienced the greatest growth in the Chassis Springs business area, increasing 56 percent during the quarter. Accumulated, since the beginning of the year, sales of chassis springs have risen 31 percent. All markets are performing well and the strongest growth is being experienced by the German market. Sales also increased in Industrial Springs and Flat Strip Components during the third quarter. The strong growth in Chassis Springs in particular bolstered Lesjöfors' earnings and margin trends. Operating profit increased 42 percent during the third quarter to MSEK 83.

Habia's invoicing grew 4 percent during the third quarter to MSEK 151. Telecom and other product areas reported higher invoicing year-on-year. The order backlog declined during the quarter due to lower order bookings from industrial customers and delayed orders from nuclear-power customers. However, business activity in the nuclear-power area remains high, which should lead to improved order bookings in the coming quarters. Demand from telecom customers remains robust. Habia holds a strong global market position in cables for base-station antennas and the build-out of the mobile network, particularly in China, is contributing to demand for the company's products. Improved sales volumes contributed to an increase in Habia's operating profit from MSEK 13 to MSEK 15.

Beijer Tech's invoicing rose 1 percent to MSEK 178 during the third quarter. In comparable units, however, invoicing declined 9 percent. The rate of the decline was lower than in previous months. In the past quarter, invoicing was primarily weaker in Fluid Technology, while sales in Industrial Products remained relatively unchanged. Operating profit declined from MSEK 12 to MSEK 10, due primarily to non-recurring costs in the Industry business area. Adjusted for these costs, both earnings and the operating margin were in line with the year-earlier period.

Bertil Persson President and CEO

Group

The demand trend was positive and invoicing increased in Lesjöfors and Habia. In Beijer Tech, whose dominant market is Sweden, the trend was weaker. Lesjöfors's Chassis Springs business area performed the best in terms of sales. Overall, order bookings in comparable units rose 10 percent, compared with the year-earlier period.

During the third quarter, order bookings totaled MSEK 753 (641), up 17 percent. Invoicing increased 15 percent to MSEK 755 (652). In comparable units, invoicing rose 8 percent. Operating profit was MSEK 103.1 (79.5) and the operating margin was 13.7 percent (12.2). Profit after net financial items amounted to MSEK 100.3 (76.1) and earnings per share were SEK 2.55 (1.84).

Cash flow after capital expenditures was MSEK 79.8 (51.5). In the year-earlier period, corporate acquisitions of MSEK 39.9 were charged to cash flow. Net debt amounted to MSEK 178 (126).

During the period from January to September, order bookings rose 12 percent to MSEK 2,333 (2,077). Invoicing totaled MSEK 2,293 (2,101), up 9 percent. In comparable units, order bookings rose 3 percent, while invoicing remained unchanged. Operating profit totaled MSEK 297.8 (276.0) and the operating margin was 13.0 percent (13.1). Fluctuations in exchange rates had a negligible impact on earnings. Profit after net financial items was MSEK 288.3 (266.8). Earnings per share were SEK 7.32 (6.46). The Group's cash flow after capital expenditures but before acquisitions was MSEK 209.4 (222.0).

Subsidiaries

Lesjöfors

Lesjöfors AB is a full-range supplier of standard and specially produced industrial springs, wire and flat strip components. The company is a dominant player in the Nordic region and one of the largest companies in its industry in Europe. Lesjöfors has manufacturing operations in Sweden, Denmark, Finland, Germany, Latvia, the UK, Slovakia and China.

Lesjöfors pursues operations in three business areas: Industrial Springs, Flat Strip Components and Chassis Springs. The principal customer of Industrial Springs and Flat Strip Components is the engineering industry, while Chassis Springs sells to the aftermarket for vehicles. Sales increased in all business areas. The highest rate of increase was in Chassis Springs.

During the third quarter, order bookings totaled MSEK 442 (320), up 38 percent. Invoicing rose 28 percent to MSEK 423 (330). In comparable units, order bookings increased 31 percent and invoicing rose 20 percent. Operating profit was MSEK 82.7 (58.1)

During the period from January to September, order bookings amounted to MSEK 1,303 (1,043), up 25 percent. Invoicing levels rose 21 percent to MSEK 1,278 (1,054). In comparable units, order bookings rose by 13 percent and invoicing by 9 percent. Operating profit totaled MSEK 251.0 (215.1).

Habia Cable

Habia Cable AB is one of Europe's largest manufacturers of custom-designed cable for customers in the telecom, transport, nuclear power, defense and other industries. The company has manufacturing operations in Sweden, Germany, China and Poland, and conducts sales worldwide.

Habia's demand was stable during the quarter. Invoicing to both the telecom sector and engineering industry were at slightly higher levels year-on-year.

During the third quarter, order bookings declined 8 percent to MSEK 134 (145). Invoicing increased 4 percent to MSEK 151 (145). Operating profit totaled MSEK 14.9 (12.8).

During the period from January to September, order bookings totaled MSEK 461 (449), up 3 percent. Invoicing declined 3 percent to MSEK 1,447 (460). Operating profit was MSEK 33.0 (40.5)

Beijer Tech

Beijer Tech AB specializes in industrial trading in the Nordic region and represents several of the world's leading manufacturers. The company's operations are conducted in the business areas: Industrial Products and Fluid Technology/Industrial Rubber.

Demand remains weak in the Fluid Technology/Industrial Rubber business area, which reported lower invoicing than in the year-earlier period. However, the quarterly invoicing for Industrial Products was in line with the year-earlier period.

During the third quarter, order bookings and invoicing totaled MSEK 178 (176), up 1 percent. In comparable units, the volume of order bookings and invoicing declined 9 percent. Operating profit was MSEK 9.9 (12.3)

During the period from January to September, order bookings and invoicing totaled MSEK 569 (587), down 3 percent. In comparable units, the volume of order bookings and invoicing declined 13 percent. Operating profit was MSEK 30.6 (38.7).

Parent Company

The Parent Company, Beijer Alma AB, is a holding company that does not conduct external invoicing. The Parent Company reported an operating loss of MSEK 4.3 (loss: 3.9) during the third quarter, and a loss of MSEK 16.6 (loss: 18.6) during the period from January to September.

Revenues and earnings per operating sector/segment

Net revenues
MSEK 2013 2013 2013 2012 2012 2012 2012 2012
Full
2011
Full
Q3 Q2 Q1 Q4 Q3 Q2 Q1 year year
Lesjöfors 423.5 472.1 381.9 312.5 330.4 368.9 354.9 1,366.7 1,386.0
Habia Cable 150.8 160.8 135.4 172.6 145.2 152.2 162.4 632.4 668.2
Beijer Tech 178.2 203.7 186.7 193.8 176.1 209.7 200.7 780.3 777.1
Parent Company and intra-Group 0.1 0 0.2 0 0.1 0.1 0.1 0.3 –1.1
Total 752.6 836.6 704.2 678.9 651.8 730.9 718.1 2 779.7 2 830.2
Operating profit
MSEK 2013 2013 2013 2012 2012 2012 2012 2012
Full
2011
Full
Q3 Q2 Q1 Q4 Q3 Q2 Q1 year year
Lesjöfors 82.7 97.8 70.5 70.3 58.1 78.9 78.1 285.4 352.1
Habia Cable 14.9 12.8 5.3 21.4 13.1 12.1 15.3 61.9 55.9
Beijer Tech 9.9 13.9 6.8 8.5 12.3 13.9 12.5 47.2 57.8
Parent Company and intra-Group –4.4 –7.0 –5.4 –3.9 –4.0 –8.5 –5.8 –22.2 –24.4
Total operating profit 103.1 117.5 77.2 96.3 79.5 96.4 100.1 372.3 441.4
Net financial items –2.8 –3.5 –3.2 –1.3 –3.4 –3.6 –2.2 –10.5 –12.7

Corporate acquisitions

No corporate acquisitions were made during the third quarter. During the first half of the year, Lesjöfors acquired S & P Federnwerk GmbH & Co KG and Centrum B. Also during the first half of the year, Beijer Tech acquired PMU Reparation och Smide AB and the assets and liabilities of Lubritek.

Profit after financial items 100.3 114.0 74.0 95.0 76.1 92.8 97.9 361.8 428.7

Detailed information about the acquisitions completed during the first half of the year is available in previous interim reports.

Events after the end of the period

No significant events occurred after the end of the period.

Risks and uncertainties

The Group's material risks and uncertainties include business and financial risks. Business risks may include major customer exposures to individual industries or companies. Financial risks primarily pertain to foreign currency risks that arise because 85 percent of sales for Habia and Lesjöfors are conducted outside Sweden, while approximately 55 percent of production takes place in Sweden.

Management of the Group's financial risks is described in Note 30 of the 2012 Annual Report. The Group is deemed to have a favorable risk spread across industries and companies and the assessment is that the risk situation remained unchanged during the year.

Accounting policies

Group

This interim report was prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the European Union (EU). The presentation of the year-end report complies with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act.

No new or revised IFRS that took effect in 2013 had a significant impact on the Group. Accounting policies and terms of calculation are unchanged compared with those applied in the 2012 Annual

Report. Significant accounting and valuation policies are found on pages 54-57 of the 2012 Annual Report.

Parent Company

The Parent Company, Beijer Alma AB, applies the Swedish Annual Accounts Act and the Swedish Financial Reporting Board's recommendation RFR 2 Accounting for Legal Entities. These accounting policies correspond with the preceding year and with the consolidated accounting policies where applicable.

Condensed income statement

Group
MSEK 2013 2012 2013 2012 2012 2011 2010
Q3 Q3 Jan–Sept Jan–Sept Full-year Full-year Full-year
Net revenues 752.6 651.8 2,293.4 2,100.8 2,779.7 2,830.2 2,290.1
Cost of goods sold –512.1 –447.6 –1,556.8 –1,411.7 –1,842.5 –1,845.5 –1,426.2
Gross profit 240.5 204.2 736.6 689.1 937.2 984.7 863.9
Selling expenses –74.0 –70.8 –235.2 –228.8 –316.3 –299.6 –238.3
Administrative expenses –63.5 –54.4 –204.0 –185.2 –249.5 –244.6 –220.2
Profit from participations in associated
companies 0.1 0.5 0.4 0.9 0.9 0.9 0.9
Operating profit 103.1 79.5 297.8 276.0 372.3 441.4 406.3
Interest income 0.4 0.5 1.3 1.7 3.2 3.5 1.9
Interest expenses –3.2 –3.9 –10.8 –10.9 –13.7 –16.2 –9.4
Profit after financial items 100.3 76.1 288.3 266.8 361.8 428.7 398.8
Tax on net profit for the year –23.5 –20.5 –67.6 –72.0 –93.3 –115.8 –112.3
Net profit attributable to Parent Company
shareholders
76.8 55.6 220.7 194.8 268.5 312.9 286.5
Other comprehensive income
Income/expenses recognized directly against
shareholders' equity
Cash-flow hedges 1.9 1.7 –5.1 2.4 0.6 –18.6 8.5
Translation differences –9.4 –33.1 2.6 –29.7 –21.6 5.0 –39.5
Total other comprehensive income after tax –7.5 –31.4 –2.5 –27.3 –21.0 –13.6 –31.0
Total comprehensive income attributable to
Parent Company shareholders 69.3 24.2 218.2 167.5 247.5 299.3 255.5
Other comprehensive income pertains, in its entirety, to items that may be reclassified in the profit or loss
statement.
Net earnings per share
before and after dilution, SEK 2.55 1.84 7.32 6.46 8.91 10.38 9.51
Dividend per share, SEK 7.00 7.00 7.00
Includes amortization and depreciation in the
amount of, MSEK
21.5 19.9 63.9 59.1 78.7 76.3 70.7
Parent Company
2013 2012 2013 2012 2012 2011 2010
Q3 Q3 Jan–Sept Jan–Sept Full-year Full-year Full-year
Administrative expenses –8.9 –8.1 –30.3 –31.0 –39.2 –36.3 –41.2
Other operating income 4.6 4.2 13.7 12.7 17.0 12.1 14.6
Operating profit –4.3 –3.9 –16.6 –18.3 –22.2 –24.2 –26.6
Group contributions received 81.7 110.1 113.8
Income from participations in Group
companies 161.0 145.0 116.0
Interest income and similar revenues 0.7 0.5 1.3 1.7 2.5 4.2 5.0
Interest expenses and similar expenses –0.3 –1.5 –2.6 –4.3 –20.6 –5.8 –4.4
Profit after financial items –3.9 –4.9 –17.9 –20.9 202.4 229.3 203.8
Tax on net profit for the period 0.8 0.8 3.5 4.3 –10.2 –22.6 –25.3
Net profit –3.1 –4.1 –14.4 –16.6 192.2 206.7 178.5

Condensed balance sheet

Group
MSEK 2013 2012 2012 2011
Sept 30 Sept 30 Dec 31 Dec 31
Assets
Fixed assets
Intangible assets 535.4 513.2 533.3 378.2
Tangible assets 605.4 531.8 537.2 504.7
Deferred tax assets 24.4 19.5 15.7 17.3
Financial assets 23.5 25.5 25.4 27.2
Total fixed assets 1,188.7 1,090.0 1,111.6 927.4
Current assets
Inventories 512.4 485.6 516.1 508.8
Receivables 654.6 627.6 527.5 495.6
Cash and bank balances 171.9 166.8 239.5 269.0
Total current assets 1,338.9 1,280.0 1,283.1 1,273.4
Total assets 2,527.6 2,370.0 2,394.7 2,200.8
2013 2012 2012 2011
Sept 30 Sept 30 Dec 31 Dec 31
Shareholders' equity and liabilities
Shareholders' equity
Share capital 125.5 125.5 125.5 125.5
Other contributed capital 444.4 444.4 444.4 444.4
Reserves –38.5 –42.3 –36.0 –15.0
Retained earnings, including net profit for the period 995.4 912.0 985.6 928.0
Shareholders' equity attributable to Parent Company
shareholders 1,526.8 1,439.6 1,519.5 1,482.9
Non-controlling interests 2.7 2.7 2.6 2.7
Total shareholders' equity 1,529.5 1,442.3 1,522.1 1,485.6
Long-term liabilities to credit institutions 197.3 134.4 151.5 122.3
Other long-term liabilities 152.1 119.8 172.0 48.7
Current liabilities to credit institutions 149.7 157.0 144.8 124.2
Current non-interest-bearing liabilities 499.0 516.5 404.3 420.0
Total liabilities 998.1 927.7 872.6 715.2
Total shareholders' equity and liabilities 2,527.6 2,370.0 2,394.7 2,200.8
Parent Company
MSEK 2013 2012 2012 2011
Sept 30 Sept 30 Dec 31 Dec 31
Assets
Fixed assets
Tangible assets 1.0 1.0 1.0 1.0
Financial assets 532.2 526.7 534.0 529.4
Total fixed assets 533.2 527.7 535.0 530.4
Current assets
Receivables 81.2 182.6 310.5 328.2
Cash and cash equivalents 0.8 0.1 40.0 42.2
Total current assets 82.0 182.7 350.5 370.4
Total assets 615.2 710.4 885.5 900.8
MSEK 2013 2012 2012 2011
Sept 30 Sept 30 Dec 31 Dec 31
Shareholders' equity and liabilities
Share capital 125.5 125.5 125.5 125.5
Statutory reserve 444.4 444.4 444.4 444.4
Retained earnings 39.1 57.9 57.8 62.1
Net profit for the period –14.4 –16.6 192.2 206.7
Total shareholders' equity 594.6 611.2 819.9 838.7
Current liabilities to credit institutions 9.4 82.3 47.2 41.5
Current non-interest-bearing liabilities 11.2 16.9 18.4 20.6
Total shareholders' equity and liabilities 615.2 710.4 885.5 900.8

Condensed cash-flow statement

2013 2012 2013 2012 2012 2011 2010
Full Full Full
Q3 Q3 Jan–Sept Jan–Sept year year year
Cash flow from operating activities before change in
working capital and capital expenditures 104.5 87.9 298.8 278.6 318.2 388.4 389.7
Change in working capital, increase (–) decrease (+) 7.0 19.1 –11.3 –11.9 18.0 –61.0 –109.4
Cash flow from operating activities 111.5 107.0 287.5 266.7 336.2 327.4 280.3
Investing activities –31.7 –15.6 –78.1 –44.7 –72.0 –94.6 –47.1
Acquired operations –39.9 –76.0 –136.9 –142.3 –80.8 –65.0
Cash flow after capital expenditures 79.8 51.5 133.4 85.1 121.9 152.0 168.2
Financing activities –69.2 –33.0 –209.1 –195.4 –159.6 –124.4 –138.5
Change in cash and cash equivalents 10.6 18.5 –75.7 –110.3 –37.7 27.6 29.7
Cash and cash equivalents at beginning of period 161.3 148.3 239.5 269.0 269.0 238.1 195.5
Exchange-rate difference in cash and cash equivalents
and cash from acquired/divested operations 8.1 8.1 8.2 3.3 12.9
Cash and cash equivalents at end of period 171.9 166.8 171.9 166.8 239.5 269.0 238.1
Approved but not utilized committed credit facilities 396.9 372.3 396.9 372.3 306.0 389.9 428.3
Available liquidity 568.8 539.1 568.8 539.1 545.5 658.9 666.4

Specification of changes in shareholders' equity

2013 2012 2012 2011 2010
Jan–Sept Jan–Sept Full-year Full-year Full-year
Opening shareholders' equity attributable to Parent Company
shareholders
1,519.5 1,482.9 1,482.9 1,394.5 985.9
Comprehensive income for the period 218.2 167.6 247.5 299.3 255.5
Dividend paid –210.9 –210.9 –210.9 –210.9 –137.2
New issue
Closing shareholders' equity attributable to Parent Company
290.3
shareholders 1,526.8 1,439.6 1,519.5 1,482.9 1,394.5
Non-controlling interests 2.7 2.7 2.6 2.7 2.7
Total closing shareholders' equity 1,529.5 1,442.3 1,522.1 1,485.6 1,397.2

Specification of shareholders' equity attributable to Parent Company shareholders for the period

Retained earnings,
including net profit for the
Share capital Other contributed capital Reserves period Total
December 31, 2012
Comprehensive income for
125.5 444.4 –36.0 985.6 1,519.5
the period –2.5 220.7 218.2
Dividend paid –210.9 –210.9
September 30, 2013 125.5 444.4 –38.5 995.4 1,526.8

Number of shares

2013 2012 2011
Sept 30 Dec 31 Dec 31
Number of shares outstanding 30,131,100 30,131,100 30,131,100
Total number of shares, after full dilution 30,131,100 30,131,100 30,131,100
Average number of shares, after full dilution 30,131,100 30,131,100 30,131,100

Of the total number of shares outstanding, 3,330,000 are Class A shares and the remaining shares are Class B shares.

Key figures

2013 2012 2013 2012 2012 2011 2010
Q3 Q3 Jan–Sept Jan–Sept Full-year Full-year Full-year
Number of shares 30,131,100 30,131,100 30,131,100 30,131,100 30,131,100 30,131,100 30,131,100
Net revenues, MSEK 752.6 651.8 2,293.4 2,100.8 2,779.7 2,830.2 2,290.1
Operating profit, MSEK 103.1 79.5 297.8 276.0 372.3 441.4 406.3
Profit before tax, MSEK
Earnings per share after tax,
100.3 76.1 288.3 266.8 361.8 428.7 398.8
SEK
Earnings per share after
22.0% or 26.3% standard
2.55 1.84 7.32 6.46 8.91 10.38 9.51
tax, SEK
Cash flow after capital
expenditures, excluding
2.60 1.86 7.46 6.52 8.85 10.49 9.75
acquisitions per share, SEK
Return on shareholders'
2.65 3.04 6.94 7.37 8.77 7.73 7.74
equity, %
Return on capital employed,
21.0 15.6 19.7 17.9 17.8 21.8 24.7
%
Shareholders' equity per
22.1 18.6 21.6 21.4 21.2 26.4 30.6
share, SEK 50.67 47.13 50.67 47.78 50.43 49.22 46.28
Equity ratio, % 60.4 60.7 60.4 60.7 63.5 67.4 70.6
Net debt/equity ratio, %
Cash and cash equivalents,
including unutilized credit
11.6 8.8 11.6 8.8 3.7 –1.5 –6.5
facilities, MSEK 568.8 539.1 568.8 539.1 545.5 658.9 666.4
Capital expenditures, MSEK
Interest-coverage ratio,
29.7 15.9 78.6 46.5 70.5 89.2 55.2
multiple
Number of employees at
31.7 17.6 27.7 24.2 27.5 27.5 43.4
end of period 2,162 1,952 2,162 1,952 1,972 1,686 1,435

Uppsala, October 23, 2013

Beijer Alma AB (publ)

Bertil Persson President and CEO

This interim report has not been audited.

If you have any questions, please contact:

Bertil Persson, President and CEO, Telephone +46 8-506 427 50, [email protected] Jan Blomén, Chief Financial Officer, Telephone +46 18-15 71 60, [email protected]

______________________________________________________________________________________

Read more at: www.beijeralma.se

Visit our subsidiaries:

www.lesjoforsab.com www.habia.com www.beijertech.se

Next report date:

Year-end report on February 14, 2014.

Annual General Meeting:

The Annual General Meeting will be held in Uppsala on March 27, 2014.

Beijer Alma AB (publ)

Dragarbrunnsgatan 45, Box 1747, SE-751 47 Uppsala, Sweden. Telephone +46 18 15 71 60. Fax +46 18 15 89 87. Registered office: Uppsala. Corp. Reg. No.: 556229-7480. www.beijeralma.se

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