Annual Report • Apr 17, 2014
Annual Report
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| Byggmax in brief | 3 |
|---|---|
| The year in summary | 5 |
| President's comments | 6 |
| Vision, concept, targets and strategy | 8 |
| Operations | 10 |
| Employees | 15 |
| Our responsibilities | 20 |
| The Byggmax share | 28 |
| Chairman's comments | 30 |
| Administration report | 32 |
|---|---|
| Corporate governance | 36 |
| Mutli-year overview | 40 |
| Consolidated income statement | 41 |
| Consolidated balance sheet | 42 |
| Consolidated statement of changes in | |
| shareholder's equity | 44 |
| Consolidated statement of cash flows | 45 |
| Parent Company income statement | 46 |
| Parent Company balance sheet | 47 |
| Changes in Parent Company's shareholder's equity | 49 |
| Parent Company cash-flow statement | 50 |
| Accounting policies and notes | 51 |
| Auditor's report | 75 |
| Byggmax Group management | 76 |
| Byggmax Board of Directors | 77 |
| Content index including standard GRI disclosures | 78 |
| Byggmax GRI proŒle | 88 |
| DeŒnitions | 91 |
Distribution of Annual Report 91
A product range limited to 1,500 items simpli es administration and procurement.
Out-of-town stores that are easily accessible for customers in vehicles provide low rents
Sta costs can be kept low when customers load their vehicles themselves.
Continuous e ciency enhancement of each process and procedure.
The entrepreneurial spirit in each store forms the foundation for our ability to succeed
Our customers nd inspiration and building instructions on our website.
Byggmax has always kept true to one simple fundamental concept: To retail high-quality standard building materials at the lowest possible price. We aim to do this in as simple and accessible a manner as possible in all of our 105 stores in the Nordic region. We will therefore remain true to our pricing model, meaning: No campaigns, no sales and no discounts. At Byggmax, the same low price applies for every customer.
In the spring of 2009, Byggmax launched its online store. The service comprises
home delivery of all products in the range, which is unique when it comes to heavy construction materials. The goods are picked from the closest Byggmax store to the customer and the only additional costs are for picking and freight. In the majority of cases, there is next-day delivery.
The DIY trend took Sweden by storm in 1997. Many realized that building is not as hard as they thought and substantial sums can be saved. The building materials industry was at full capacity and Byggmax established operations in many locations.
4 Byggmax 2013 annual report
1993
Byggmax iN Norge
STOCK EXCHANGE
ONLINE GOODS
In 2011, a range of products available only to order was added to Byggmax Online. In 2013, this range included about 3,400 products. These products are only sold online, which enables us to o er Byggmax prices on even more products without increasing store costs. The main focus of the website is ease of use, which makes it just as easy to shop online as in a store.
On June 2, 2010, Byggmax was listed on the NASDAQ OMX Stockholm Exchange.
LISTING
Byggmax opened a central customer service center in 2000 to answer customer questions seven days a week. Customer service aims to answer all calls within three minutes.
2000 Kållered (Gothenburg).
1998 Hisings Backa (Gothenburg), Upplands Väsby (Stockholm), and Umeå.
1997 Helsingborg.
1996 Sta anstorp (Malmö).
1993 Täby (Stockholm), Halmstad, Västerås.
Byggmax opened its rst stores in 1993 to retail highquality standard building materials at low prices. The description of the product range is Lumber, Construction, Flooring and Paint. The idea from the start is for customers to be able to drive their vehicles in and load 2011 Sweden: Ängelholm, Lidköping, Norrtälje, Enköping, Avesta, Bollnäs. Norway: Trondheim Syd, Arendal, Lillehammer. Finland: Porvoo, Raisio, Vantaa, Pori. launched the new store concept, Byggmax 2.0.
TRADESMEN SERVICES In 2013, Byggmax launched xedprice tradesmen services.
byggmax 2.0 In 2013, Byggmax
2010 Sweden: Ystad, Värnamo, Karlshamn, Trollhättan, Partille. Norway: Ski, Kristiansand, Stavanger, Fredrikstad, Haugesund. Finland: Jyväskylä.
2009 Sweden: Piteå, Falkenberg, Kungsängen, Bromma, Borlänge. Norway: Trondheim. Finland: Vaasa.
2008 Sverige: Motala, Västervik, Örnsköldsvik, Hässleholm, Kungsbacka, Nyköping. Norge: Sarpsborg, Sande« ord, Drammen, Ullensaker, Bærum. Finland: Turku.
2007 Sweden Åkersberga (Stockholm), Visby. Norway: Hamar, Skien, Abildsø, Gjøvik, Kongsvinger.
2006 Hudiksvall, Skelle¨ eå, Skövde, Eskilstuna, Gävle, Uppsala, Varberg, Länna (Stockholm).
2005 Örebro and Karlskrona.
2004 Växjö, Norrköping, Falun, Östersund, Vellinge (Malmö), and Uddevalla.
2003 Linköping, Kalmar, Sundsvall, Tumba (Stockholm), Luleå, and Karlstad.
2002 Kristianstad.
2001 Borås and Löddeköpinge (Malmö).
1999 Jönköping.
BYGGMAX SELLS PRESSURE-TREATED DECK-ING LUMBER FOR SEK 3.95 A METER
In parallel with Byggmax's opening in Sta anstorp in 1996, we started to sell pressure-treated decking lumber for SEK 3.95 a meter. Other companies were selling the same lumber for between SEK 8.00 and 13.00 a meter. The lines were long and success was cemented.
the products themselves. Byggmax never has sales, discounts or campaigns. The range is of high quality and comes from Swedish suppliers. The entire range is subject to the same low prices and all stores have the same prices. To earn customer con dence, Byggmax becomes the rst DIY retailer in Sweden to o er a Lowest-Price Guarantee. All customers can borrow a trailer at no cost.
2013 Sweden: Karlskoga, Torslanda, Sandviken, Härnösand, Arvika. Norway: Askøy, Larvik, Haugenstua. Finland: Espoo, Kangalsa, Seinäjoki.
2012 Sweden: Malmö, Smedjebacken, Eslöv, Sisjön. Norway: Moss, Askim, Stord. Finland: Oulo.
Byggmax iN Finland Byggmax opened in Turku on February 28, 2008. A strong DIY tradition exists in Finland and customers like the new contender, Byggmax. Byggmax receives much publicity in the media since all our low prices are published on the website.
On January 1, 2006, the venture capital rm Altor 2003 Fund became the new majority shareholder. Altor believes in the Byggmax concept and wants to continue expanding in Sweden and abroad.
Since it was founded in 1993, the company's names have been Gunnars Byggnetto, Byggnetto and Netto-Netto. In 1999, all the stores changed their name to Byggmax to establish a new, clear and uni ed pro le. The logo, the name and the graphical pro le are intended to convey the message that we have optimized the relationship between
price and quality for standard building materials.
The Byggmax card was launched in 2007. Both companies and consumers could get between 30 and 60 days cost-free credit. Today, it is possible to
use a PIN code and get a speci ed invoice sent home.
BYGGMAX CUSTOMER SERVICE CENTER OPENS
In 2013, Byggmax generated sales of approximately SEK 3.2 billion, up 4.1 percent yearon-year. In parallel, the EBIT margin amounted to 7.7 percent. During the year, the company opened 11 new stores and had 105 stores at year-end and an average of 629 employees over the year.
| 2013 | 2012 | 2011 | |
|---|---|---|---|
| Net sales, SEK M | 3 216 | 3 090 | 2 987 |
| Gross margin, % | 30,7 | 30,2 | 30,1 |
| EBITA, SEK M | 247 | 252 | 278 |
| EBITA margin, % | 7,7 | 8,2 | 9,3 |
| ProŒt a¨er tax, SEK M | 184 | 180 | 182 |
| Cash flow from operations | |||
| per share | 3,2 | 3,6 | 1,5 |
| Number of stores at year end | 105 | 94 | 86 |
| Stores opened during the | |||
| period | 11 | 8 | 13 |
"Byggmax's corporate culture is based on entrepreneurship and pride. This enables us to take good care of customers, costs and earnings."
In 2013, it was primarily the Norwegian and Finnish markets that underperformed, while the market in Sweden developed in line with expectations. The end of the year was weaker in Norway and Finland, while Sweden put in a strong nish to the year. At the same time, low-price concepts such as Byggmax are favored in tougher economic climates and we are capturing market shares in all our markets.
Over the full year, Byggmax opened 11 stores, which was in line with our target of 10-15 stores for the year. In addition, we raised the total number of stores planned for the three countries we operate in during the year. In total, we have identi ed potential for 180 stores in Sweden, Norway and Finland, which is 25 more than previously announced. Based on the sales posted by our existing store portfolio, we have decided that opportunities exist for additional stores in the vicinity of major cities and for additional openings in slightly smaller communities. The store potential is by country is: Sweden 95 (+10), Norway 60 (+15) and Finland 25.
A new web platform was launched in the fourth quarter. The new platform, which has a signi cantly enhanced performance to the previous platform, allows an expanded range on the website and simpli es navigation.
We gathered all permanent employees at a major conference on November 16-17, to draw up a new set of values. Byggmax is governed by its company values, and clear, shared values are important for the company.
During the year, Byggmax launched a trial o ering of building services in Stockholm. Customers can buy flooring and painting services at xed prices per square meter on the Byggmax website. The idea is to expand the test geographically and the range of building services o ered if results are favorable. The concept has signi cant potential as these building services attract an entirely new target group, people who want to renovate but who are either unable to or unwilling to do it themselves.
Byggmax 2.0 is an updated store concept, with more articles and clearer communication, utilizing the same sales area and with substantially improved sales control. Byggmax 2.0 stores have delivered promising sales increases following conversion.
During the year, seven stores were converted and all new stores open with the 2.0 concept in place. Our aim is to convert an additional ¨ een stores ahead of the peak season in 2014, in other words, by the end of April. We then plan to convert another ¨ een stores in autumn 2014. At the end of 2013, Byggmax had a total of 18 Byggmax 2.0 stores in place.
The four Byggmax 2.0 pilot stores have been evaluated. On average, total sales for these four stores were slightly more than 7 percent better than for other comparable stores in Sweden. The increase in the fourth quarter was at a comparable levels.
Achieving such favorable results in such a short time with limited marketing e orts is highly gratifying and we see signi cant potential in the new format. Approximately 60 percent of the increase is attributable to the new products and these have margins that are 8 percentage points above the average based on outcomes in September.
Moving forward, the total investment to convert a store is expected to be around SEK 1.6 M and conversion is expected to lead to about SEK 0.6 M tied up in inventory, which is partly nanced by an increase in accounts payable. In the Byggmax 2.0 business concept, approximately half of the cost of additional sales from Byggmax 2.0 are xed and half variable.
Based on this positive performance, the Board has decided to continue with roll-out of Byggmax 2.0. This decision means that a further 30 stores will be converted in 2014.
Since 2009, an annual environmental report has been produced on Byggmax's environmental impact. This year's report shows a reduction in carbon emissions per ton of materials sold and the single most important explanation for this is the increase in the proportion of goods procured locally, in other words the percentage of sourcing from Asia has been reduced. Since 2009, carbon emissions per ton of goods transported have declined 14 percent, 8 percent in 2013. This means we are well on the way to reaching our goal of a 25-percent reduction by 2020.
As of 2011, Byggmax reports its sustainability initiatives in line with the Global Reporting Initiative's (GRI) framework for sustainability reporting. We report in line with the A+ level, which is the highest level under the GRI.
It is gratifying to have continued our growth and maintained healthy pro tability. It shows the strength inherent in the concept and the increasing consumer trend towards choosing the low-price alternative when purchasing building supplies - irrespective of the situation in the economy. Many people dream of renovating their home themselves. We make it quick, simple and inexpensive to carry out large or small-scale construction projects. Naturally, we continue to see great potential in growing in the three countries where we currently have operations,
and in the long term to also start looking further a eld. We aim to establish a store network of 180 stores in our existing markets.
When we look ahead towards 2014, we foresee a number of areas with positive development potential. This includes opening new stores, an updated product range in Byggmax 2.0 and a new website. Byggmax is on a solid footing, which enables us to invest in several initiatives in parallel.
In conclusion, I would like to thank all of our employees, who were involved in helping us achieve our strong performance, and all of our customers who show their con dence in us every day.
The Byggmax vision is to be the world's best DIY retailer. Read more about how we intend to achieve it.
The business concept is to retail high-quality building materials at the lowest possible price.
A description of the Byggmax concept follows:
The Byggmax vision is to be the world's best DIY retailer.
Byggmax's goals are:
Operations in Sweden developed in line with our expectations. Sales were negatively aected by the downturn in the consumer markets, primarily the markets in Norway and Finland. This meant that during the 2013 scal year, Byggmax achieved a growth in net sales of 4.1 percent and an EBIT margin of 7.7 percent.
Byggmax had an average annual growth rate of 11.2 percent during the 2008-2013 period. In 2013, the EBIT margin was 7.7 percent. The sales trend, as illustrated above, had a negative impact on the EBIT margin.
Byggmax had an average annual growth rate of 12.7 percent during the 2008-2013 period. The EBIT margin in 2008 was impacted by the establishment of operations in Norway and Finland, respectively. In 2010, the EBIT margin was impacted by listing costs.
Byggmax has dened the following strategies for achieving its nancial goals: to expand the store network, improve its operations and develop the business.
Over time, Byggmax will increase its presence in Sweden to about 95 stores, in Norway to about 60 stores and in Finland to about 25 stores in economically attractive locations. Byggmax performs ongoing analyses of opportunities for establishment in new markets but as yet no decision has been made.
Byggmax will improve operations by further expanding its use of economies of scale at its purchasing function by handling larger product volumes and through procurement from low-cost countries. The organization will enhance its resource-e´ciency by implementing continuous business process improvements and reducing costs. Furthermore, Byggmax will capitalize on newly opened stores becoming more protable once they reach maturity and on increasing sales in already well-established stores.
Byggmax works continuously with business development. IT support and, in particular, the website are developed every year through a number of projects with the customer in focus. Procurement, sales procedures and marketing undergo ongoing development in respect of private customers and professional tradesmen. The online store was launched in late 2008, delivering from the store to the customer and substantial focus has been placed on developing this service. In 2011, the online store was expanded with the addition of online goods with direct delivery to the customers from the suppliers. In addition,
• Expansion of the store network
excess of 15 percent of net sales per year by expanding the store network and increasing sales in like-to-like stores, and
• to maintain an EBIT margin in relation to net sales of more than 11 percent.
Byggmax is adjusting the range to seasonal variations to boost sales in the rst and fourth quarters.
Value drivers are factors that affect the development of Byggmax in the short and long term. The following constitute those that the management assesses as having most relevance. Many factors impact operations in both the short and long term and, as such, are listed under the category where they are considered to exert most influence.
Since the company was founded in 1993, the Byggmax concept has been essential to the development of operations. The concept is based on a focused product range, a resourcee cient organization, a strong corporate culture and consistent pricing strategy.
Byggmax o ers a ordable high-quality products for the most common maintenance and DIY projects. The primary target group is consumers and the range of products encompasses standard building materials, such as lumber, insulation, sheets and boards as well as paint – at the same low price regardless of whether the customer is a tradesman or a consumer. With its focused range, Byggmax handles large volumes and can obtain economies of scale
in purchasing and logistics. Since the company was founded in 1993, its operations have been conducted in accordance with the Byggmax concept, which has been essential to the company's development. The concept is based on a focused product range, a resource-e cient organization, a strong corporate culture and e ective pricing strategy, as well as the characteristic design of the stores. Today, Byggmax has a strong market position, an extensive store network and a popular brand.
A story of cooking and cabinetmaking that takes us from Maine to Stavanger
Charlie: We met at a place in Portland, Maine where I was working. That evening, it was open mike night, and when Erika came in I walked straight up to her and said, 'Hi, I'm Charlie.' A little later, she joined me and the band to perform Wild Rover.
Erika: Two years later, we moved to Stavanger and tied the knot.
Charlie: I like to entertain and create a pleasant atmosphere. When I was little I was never allowed to be in the kitchen, which is probably why I always wanted to be a chef. Now Erika and I have renovated a kitchen which we rent out for dinners and events. Erika: I have almost ve-years' experience as a cabinetmaker and have built a fair amount of high quality furniture for private custom-
ers. My husband has a little knowledge of joinery but he's best in the kitchen. Myself, I'm best in the furniture workshop so I have the main responsibility for joinery work. Charlie: I have a lot of interests so, when shopping, it's important for me that it is easy, quick and cheap. For me, it is important that I can
make the money stretch as far possible. I don't have time to run around checking prices, I go direct to Byggmax where I know I'll be happy.
Byggmax does not own its own factories and instead purchases goods from independent suppliers, primarily in the Nordic region, but also from other European countries and Asia. Byggmax does not own its own stores either; it leases store premises from international and local landlords.
All of the operations are managed from the head o ce in Solna, Sweden. The company's business model serves as a platform to generate continued organic growth through both the expansion of the store network and increased comparable sales per store.
Byggmax conducts business activities in the Swedish, Norwegian and Finnish DIY markets. The European DIY market generates sales totaling approximately EUR 92.9 billion according to Mintel1 and is expected to grow by about 2 percent annually over the next ve years compared with average annual growth between 2005 and 2009 of 0.9 percent. Corresponding gures for the same period for Sweden, Norway and Finland show average annual growth that has outperformed many other European markets since 2002. Sweden, Norway and Finland jointly represent almost one-tenth of the European market, with Norway accounting for the highest DIY sales per capita in Europe. Given Byggmax's average annual growth rate of 11.2 percent between 2008 and 2013, the growth potential in Sweden, Norway and Finland is assessed as remaining high. The building supplies market is fragmented and the housing market has a high turnover rate. It is relatively expensive to use professional tradesmen and there is a long tradition of doing the work oneself. Interest in home renovation and interior design has grown markedly in the Nordic region since the mid-1990s, which can be seen in the large number of DIY/ home decorating television programs and the range of interior-design publications.
Byggmax's competitors are other store chains, purchasing organizations, independent stores and wholesalers. The Swedish market has been dominated by Beijer and local
1 Mintel International Group – provider of market knowledge and analysis within the DIY sector – retail.
DIY retailers, but the international chains and, above all, Byggmax are the companies growing rapidly. Many international chains are expending, for example Bauhaus and K-rauta. The Norwegian market is dominated by a few strong chains with Byggmakker as the market leader. These chains sell to private consumers and professionals and other competitors include Maxbo, Coop Bygg, Optimera, Bygger'n, XL Bygg and Neumann Bygg. The market in Finland has been dominated by Rautakesko with its two concepts K-rauta and Rautia. In recent years, the only international chain to establish operations in Finland has been Bauhaus. Other competitors in Finland include Starkki and sGruppen.
The typical Byggmax customer is aged between 25 and 60 and the owner of a detached house, who wants to repaint the house, build a terrace or put up a fence. Most customers are consumers, although about a h comprises professional tradesmen. Byggmax's o ering includes the materials needed for building a house and carrying out the most common repairs, maintenance or DIY projects.
Byggmax's o ering is based on simplicity and low prices – customers should focus less on their purchases and more on their DIY projects. Prices and stock availability are available from the website and stores have drive-in facilities, where customers do more themselves and the stores require fewer employees. By having a focused product range, Byggmax can maintain high volumes of sales for most of its o ering. In addition, the range primarily contains products that require a lower level of assistance and technical support, for example, sawn lumber, insulation, doors and windows.
Practically all Byggmax stores have an identical range of products, which assists customers in their purchase planning. The range consists of the most in-demand buil-
ding supplies and includes about 1,500 products, which is far fewer than the industry norm where large retailers may have up to 100,000 products. The range in the stores only changes marginally from year to year since demand for products for repairs, maintenance and DIY projects is relatively stable. Demand and customer requests for speci c new products are followed up by store personnel and the purchasing department based on close and regular contact. In 2012, the range was expanded with online goods that are sent directly from the supplier to the customer. " "
Byggmax prissättningsstrategi bygger främst på att Byggmax's pricing strategy is primarily built on o ering competitive prices relative to the competition rather than making speci c mark-ups on its own purchases. In addition, Byggmax continuously analyzes pricing and takes measures to secure competitiveness as well as pro tability. The company also has a "lowest price guarantee," which means that a customer who nds an item at a lower price from a competitor will receive the lower price plus a discount on the di erence. Another element of Byggmax's pricing strategy is to always o er low pricing instead of applying seasonal sales or campaign discounts.
Prices are set centrally, which enables rapid reaction to changes in market conditions.
For several consecutive years, Byggmax has been named the winner in price comparisons of various players in the building sector. According to the publication Vi-i-Villa's "villa panel", Byggmax continues to have a strong position among Sweden's house owners. Some 37 percent of house owners plan to shop at Byggmax according to the 2013 report, which was the highest gure for any DIY store included in the survey.
Byggmax purchases its products from approximately 200 carefully selected suppliers, of which three-quarters are located in the Nordic countries. To an increasing extent, Byggmax sources products locally, for example, more than 80 percent of lumber, which is Byggmax's largest product group, is procured locally. Byggmax de nes locally as within one country, except for Sweden, which due to its size is divided into two parts; North and South. A delivery is deemed local if it originates in the same country or part of a country as its destination. The company avoids being dependent on a single supplier by having at least two suppliers per product category. With its product strategy, Byggmax is one of the largest purchasers in its geographic market and can negotiate attractive contractual terms and
discounts. Byggmax has a distribution center but the majority of products are delivered by the supplier directly to the stores, in full truckloads. The proportion delivered via the distribution center has increased in recent years. Byggmax imposes strict requirements on its suppliers in such areas as delivery conditions, product quality, price, order con rmation and invoicing procedures, which are monitored using the company's integrated IT system (ERP – Enterprise Resource Planning system).
The high inventory turnover places major demands on e cient distribution and logistics. Currently, two-thirds of the orders from suppliers are handled automatically in the ERP system and the company strives to further automate its supply chain. Using the system, the purchasing department can identify inventory shortages in all of the stores at any one time and place an order. Furthermore, the purchasing department communicates closely and regularly with store personnel to pinpoint sales trends and activities not identi ed by the ERP system.
It can o en be di cult as a retailer to get the opportunity to participate in and influence the life cycle of a product. As regards Byggmax's major product group, lumber, this is the product group where Byggmax is sometimes able to collaborate with suppliers and influence the development of the product concept, its manufacture and production, marketing, distribution and use as well as scrapping and recycling.
In regard to the evaluation of health and safety issues over a product life cycle, for the lumber category, Byggmax has evaluated all stages in the product life cycle with the exception of research and development as well as license application and approval, since the company in its capacity as retailer has no direct opportunity to evaluate and influence. Byggmax chooses not to reveal the mark-ups utilized for the major product and service categories for reasons of business con dentiality.
Since 2003, the store network has expanded from 19 stores to a total of 105 stores, of which 68 are located in Sweden, 25 in Norway and 12 in Finland. By owning and operating the individual stores itself, Byggmax can control every aspect of daily operations and ensure that the concept is fully applied throughout the chain. The performance of store managers is measured by a few key performance ratios that the managers themselves are able to directly and significantly impact. The store managers compare their performance with stores generating comparable sales and exchange experience to meet their key performance ratios. Since 2009, part of the stores' day is to process the online store orders that are sent from store to customer. Since 2011, store personnel have provided information about and sold the new range of online goods that are sent directly to the customer from the supplier.
Byggmax's stores have a standardized design for store communication, interior ttings and display of merchandise. Even if stores can vary in size and design, customers always recognize a Byggmax store. In principle, all stock is located in the area or directly adjacent to the area where sales are made. The stores are designed to enable customers to drive into and around the site, and to allow customers to quickly load goods into their vehicles. All stores have a number of trailers that customers can borrow free of charge. All products are clearly labeled with prices and this facilitates driving between open storage and storage racks used outside for displaying merchandise. Inside, in the heated area of the store, products are located according to product category. As an inventory is regularly taken of the entire stock and all
stock is procured centrally by head oce, the shelves and store are rarely out of stock. The stores are sparsely manned and the main task of store employees is to organize the store's inventory, receive deliveries, assist customers and manage payment transactions.
The rst store was completed and a further seven stores converted under the Byggmax 2.0 concept in 2013. A decision was taken to convert a further 30 stores in 2014. Byggmax 2.0 is an updated store concept, with more articles and clearer communication, utilizing the same sales area and with substantially improved sales control. The new concept makes it easier for customers to shop and means that Byggmax can meet a larger proportion of customers' building material needs. All new stores in 2013 will open with the new concept in place. At the end of the year, Byggmax had 18 stores under the Byggmax 2.0 concept.
Byggmax continuously evaluates its store network and seeks new locations in which to establish outlets. A proven method for identifying attractive store sites exists with access to the store, and the demographics and disposable income in an area among the key criteria in determining the location of a new store. Byggmax also oers rewards to people who assist the company in identifying suitable plots or properties that are available. The method has proven eective and popular. As recently as the store inauguration in Sandviken, Sweden in June 2013, a nder's reward check of SEK 20,000 was presented to the individual who notied Byggmax about the property.
The costs of opening a new store are limited and a new outlet is expected to contribute to protability aer one year, and reach full sales maturity within two to
The diagram illustrates the development in the number of stores since the start in 1993. Over the past four years, Byggmax has opened an average of 11 new stores per year.
three years. A er a new rental lease is signed and the property made ready for occupancy, it normally takes Byggmax four to six weeks to open a store. The aim is to open new outlets immediately before or in conjunction with the hectic summer season. During the past four years, Byggmax has opened an average of ten new stores every year. To date, the company has not closed any of its stores, indicating that both the underlying analysis and expansion model works well.
During 2009, Byggmax Online was launched to broaden the company's sales channels and capitalize on internet diversity. The online store includes an interactive catalog with descriptions and images of Byggmax's complete product range. The website consistently updates prices and inventory levels for each Byggmax store. This enables customers to check from the comfort of their home if the product they are seeking is available ahead of any visit to a store. Via Byggmax's online store, customers can also opt to order the full range of Byggmax's products for delivery direct to their home. At the end of April 2011, Byggmax launched online goods, which means more products are available via the online store than are available from the physical stores. Byggmax launched a new platform in 2013, which has a signi cantly enhanced performance to the previous platform, allows an expanded range on the website and simpli es navigation.
In early 2010, Byggmax launched the Byggla.se website – a Swedish Internet community for DIY projects – in a bid to add to the exposure of its online store operations. In addition, work continued on the development and ne-tuning of internal and external logistics by way of support for the store network and web-based sales.
In 2013, Byggmax launched a trial o ering of building services in Stockholm. Customers can buy flooring and painting services at xed prices per square meter on the Byggmax website. The test will be expanded geographically as well as the range of building services o ered in 2014. The concept has signi cant potential as these building services attract an entirely new target group, people who want to renovate but who are either unable to or unwilling to do it themselves.
The brand has been steadily strengthened as a result of Byggmax consistently applying its concept and continuously expanding the store network. Byggmax has now managed to achieve nationwide brand recognition in Sweden and high brand recognition in Norway, where the chain was launched in 2007. The brand is strengthened by the company's distinct business concept and the characteristic and e ective store design.
Byggmax has invested substantial time and e ort in developing its brand and attaining economies of scale in its marketing concept. Advertising uses a consistent form of expression, with realistic situations and real customer projects, which adds a documentary feeling to activities, all in line with the strategy of making things easy for DIY enthusiasts. This concept is used in a similar fashion with local adjustments to suit Sweden, Norway and Finland.
Byggmax has utilized the concepts "Sweden is building" and "Norway is building" in these countries in the period from 2010-2013. Byggmax's customers are the main characters in television commercials, advertisements, direct mail and on the website. Customers are interviewed while carrying out their building project over a summer and comment, without being directed, on Byggmax and its products. The concept demonstrates the geographical spread of Byggmax by using customers from all over Sweden. In particular, according to independent trade publications and surveys, it has strengthened Byggmax's price pro le and brand. Byggmax does not use any advertising agencies. TV commercials are produced with the assistance of production companies and all Byggmax advertising is produced in-house.
Byggmax's business model is based on a solid corporate culture, with the focus on freedom of action and clearly defined areas of responsibility for employees.
Byggmax's solid corporate culture – the Byggmax spirit – is a prerequisite for the successful application and development of the company's business model. The corporate culture highlights freedom of action and clearly de ned areas of responsibility for employees, in addition to a flat and communicative organization, cost awareness, continuously improved business processes and e ciency in daily operations.
Consultants are seldom used, and regional managers are normally recruited internally – primarily through the promotion of store managers. As a result, the organization is characterized by e cient decision-making processes and a distinct entrepreneurial spirit.
The corporate culture is maintained by means of robust and integrated business methods, continuous internal communication and through the presence of corporate culture bearers with extensive experience in various areas of operations. All head o ce personnel work at least once per year out in the stores to maintain their links to store operations.
Byggmax applies a lean approach at both the head o ce and in the stores. Application of a lean approach means working with resource e ciency and minimizing waste. Byggmax was a nalist in the 2013 Swedish lean prize.
Byggmax has a resource-e cient organization with the majority of business activities centrally managed. Aside from the sales force, which is based in Byggmax stores, most business processes are managed function-wide across all stores by the head o ce in Solna, near Stockholm. Thus, there are no local o ces – a feature that contributes to the e ciency and economies of scale that characterize the Byggmax concept.
Store operations are organized around two main areas of responsibility, namely, regional and store management. Regional managers are responsible for the management, operation and nancial performance of a number of stores in a speci c region and for identifying appropriate new locations for additional outlets. Currently, there are eight regional managers in Sweden, Norway and Finland. The regional managers are responsible for a number of store managers in their respective region, who in turn manage the day-to-day operations.
During 2013, Byggmax had an average of 629 full-time employees (574), with store personnel accounting for the majority of the workforce. Due to signi cant seasonal variations, the operations require flexible store manning, which is achieved by having a substantial proportion of part-time employees. The relatively high degree of personal freedom of action for employees in combination with clearly de ned areas of responsibility has created a highly motivated organization. Work attendance in relation to normal working hours was 97 (97) percent during the year.
Investments in store personnel are made on an ongoing basis through regular internal training courses in product knowledge, sales and customer service. In addition, the company uses mystery shoppers each month to evaluate stores in terms of customer service, appearance, work environment and safety.
No written rules are in place as regards employing locally. However, established practice and the nature of business activities with operations in many smaller communities means the store sta , including the manager, are recruited locally.
Of the Group management, 100 percent (six of six) reside in Sweden. Of other individuals in senior positions in the remainder of the organization (regional managers), eight of eight (100 percent) are local employees. At the next management level down, 100 percent of store managers in Sweden and Finland are locally employed and the corresponding gure for Norway is 68 percent.
Byggmax receives subsidies for the employment of certain members of sta who are participating in various state-funded employment measures to promote employment. The total amount received in such subsidies totaled SEK 5.9 M in 2013 and SEK 5.1 M in 2012.
Since 2008, Byggmax has had an extensive systematic work environment program, in which all accidents and incidents are reported pursuant to a uni ed standard and followed up.
In scal year 2013, the distribution of reported work accidents was as follows.
| Work-related injuries | 2013 | 2012 |
|---|---|---|
| Number of personal injuries, employees | 13 | 12 |
| Fatalities | 0 | 0 |
| ANTAL BUTIKER No. of lost time injuries (LTIs) |
2 | 6 |
| Total number of days absent (calendar days) st due to work-related injuries 100 |
18 | 119 |
| 80 Accident ratio |
2,1 | 2,1 |
| Working days lost 60 |
2,9 | 21,0 |
The following table species the estimated number of hours training for each personnel category per employee per year. The variation in the number of hours is attributable to the individual levels of previous experience and knowledge. The lower number of hours is specied for individuals with substantial previous experience, for example, of the company and similar positions. 0 20 1993
| Introduction, | Annual repetition, | ||
|---|---|---|---|
| number of hours | number of hours | ||
| Pickers | 15 | NETTOOMSÄTTNING OCH EBITA-MARGINAL 10 |
|
| Mkr Store employees |
100 | 40 | % |
| 3000 PStore managers |
150 | 60 | 12 |
| 2500 Regional managers |
80 | 80 | 10 |
The proportion of external training amounts to between 25 percent and 35 percent of the total number of hours of training, depending on whether it is calculated on the higher or lower number of hours per personnel category. 500 1000 1500
Byggmax strongly distances itself from any form of discrimination. Written policies and procedures, in the form of an equality policy, personnel policy, ethical standpoint, HR strategy and an action plan for Nettoomsättning EBITA-marginal
cases of abusive treatment are all contained in the Byggmax personnel manual, which is available to all Byggmax employees. The Equality policy is also published on the Byggmax website. No known incidents of discrimination occurred in 2013.
On comparison within the same personnel category, women have somewhat higher salary levels than men at Byggmax. Base data comprised the closing basic salaries for store employees in Norway and Sweden as of December 31, 2013
| 2013 | 2012 | |
|---|---|---|
| Women's salaries as a percentage of men's |
101.0% | 100.4% |
| Gender | Sverige Sta' turnover |
||
|---|---|---|---|
| Men | Norge 42% |
||
| 1994 1995 1996 1997 1998 1999 2000 2001 2002 |
Women 2003 2004 2005 2006 2007 2008 |
Finland 53% 2009 2010 2011 2012 |
|
| Age | Staff turnover | ||
| <30 | 54% | ||
| Introduction, | Annual repetition, | 30-40 | 23% |
| number of hours | number of hours | 40-50 | 25% |
| NETTOOMSÄTTNING OCH EBITA-MARGINAL | 50+ | 30% | |
| Total | 44% |
The above table illustrates sta turnover by age group and gender. The high total level of sta turnover is attributable to the seasonal nature of Byggmax's operations and the corresponding large increase in temporary sta during the summer. Estimates have been made pursuant to the GRI standard but are shown according to gender and age due to insucient basic data for statistical certainty. 0 2 4 6 8 10
All permanent employees of Byggmax were gathered at a major conference on November 16-17, to draw up a new set of values. The conference was extremely successful and generated substantial energy and enthusiasm.
I stand behind my thoughts, words and actions. I deliver what I promise and always act in the best interests of Byggmax.
I see, listen to and try to understand everyone around me. By treating others as I would like to be treated I contribute to building strong and healthy relations.
I view everyone as fantastic and spread joy by being open and through my smile. In this way, we all have fun together!
I choose to always see opportunities and solutions. My positive thinking energizes the team and our customers. Anything is possible!
I maintain an open attitude and go that extra mile. I actively participate and demonstrate a genuine interest in colleagues and customers.
I always do my best and pay attention. We will be the world's best DIY retailer!
Byggmax has a resource-efficient organization with the majority of business activities centrally managed. Aside from the sales force, which is based in Byggmax stores, most business processes are managed function-wide across all stores by the head office in Solna, near Stockholm. Thus, there are no local offices – a feature that contributes to the efficiency and economies of scale that characterize the Byggmax concept.
Responsible for store operations, customer service, establishment of new stores and training.
Responsible for strategic purchases, supplies, pricing, product range and logistics.
Responsible for accounting, nancial controlling, HR & payroll.
Responsible for market strategy, production of advertising materials, the website, and operation and development of the IT environment.
Byggmax gathered all permanent employees at a major conference on November 16-17, to draw up a new set of values.
Niklas Jansson is one of the latest additions to Byggmax and faces a tricky challenge. He is tasked with establishing the new business area "Tradesmen Services", whereby Byggmax oers xed-price professional help for various projects, direct from the website. However, for someone who has run four marathons and single-handedly chipped o an entire wall of plaster with a small chisel, revolutionizing the entire construction industry feels entirely doable.
"I grew up in a construction company and learned the trade the hard way. During my career I have held various roles in the construction industry but I have never been part of creating something new like this. It is extremely exciting and, up to this point, everything seems very promising.
I could see that Byggmax was dierent from the moment I arrived for my interview. Everyone seemed happy, open and committed. There was a focus on driving development and improvement that I had never before experienced and which lled me with inspiration."
Retailing tradesmen services in the building materials trade is not exactly breaking new ground, but Niklas points out that Byggmax oers something unique, something with the potential to set an entirely new standard.
"Our approach is to establish close partnerships with the best local tradesmen, whereby both parties can focus on what they do best.
As a nationwide company with a cutting-edge website, we have considerable capacity for managing marketing, administration and customer service. In this way, tradesmen are able to focus on the actual job, where we act as an intermediary and for orders we receive from customers via our website.
By oering customers xed prices online, we save time and resources for customers and contractors. Customers know immediately what the job will cost and the tradesman receive a rm assignment that is just a matter of turning up and performing."
In the true Byggmax spirit, the goal is always to oer the industry's lowest prices without sacricing quality. The solution in this case is to give the customer an active role in working with the tradesmen.
"The customer procures all necessary material before the tradesmen arrive, and here we can see the advantage of our well-manned customer service. If anyone is uncertain, all they do is ring and they get an immediate answer. It is extremely rare for a normal building company to be able to provide this level of service.
We have shopping lists with every item needed for these services on our website. On the other hand, we have no requirement for customers to buy their material from us. The service is here to help irrespective of where the material is sourced."
Despite all the favorable preconditions, a launch of this caliber is not the easiest. Luckily, Niklas is the type of person who, to put it mildly, loves a challenge.
"This is about changing customer behavior. Today, tradesmen are normally found by traditional methods. Therefore, establishing consumer condence presents a challenge and, for this reason, we are working with a quality focus rather than a quantity focus.
We ensure that we build a personal relationship with all tradesmen in our network and let them go through our internal training program to ensure that all then follow the same standard. When the service has been deployed nationwide, we aim to work with about 200 tradesmen.
JI am a person who loves great challenges. For example, once I chipped o an entire wall of plaster with a small chisel because there was a beautiful brick wall behind the plaster. It took much longer than I thought, made an incredible amount of dust and le the neighbors less than impressed. But the apartment turned out beautiful."
Constant feedback from customers will mean a lot when Byggmax Tradesmen Services starts to grow. Niklas has already noted a positive trend and is quick to come with an ambitious goal for the future.
"During the start-up period, we have noted customer satisfaction levels ranging from seven to ten on a scale of one to ten, which clearly indicates we are on the right path.
In one year, my plan is for us to be established in all major cities. But, my true driver is my wish to revolutionize the construction industry from the ground up and eliminate the commonly recurring theme of customers feeling conned with regard to price or standard of nish.
Instead, customers will be satised with the work performed, found the service easy and accessible and, last but not least, got the job done at the right price."
Name: NIklas Jansson Title: Building Services Manager Age: 37 Time at Byggmax: one year Goal: to revolutionize the construction business
"During my career I have held various roles in the construction industry"
Text: John Rundbäck Photo: Jana Eriksson
Byggmax 2013 annual report 19
Byggmax's guidelines for social responsibility comprise a code of conduct for suppliers, ethical guidelines, environmental policy, work environment policy and equality policy. All policy documents are available in their entirety on Byggmax's website.
"It is important for Byggmax to contribute to sustainable development in society. We started a few years ago by producing our environmental report and are continuing now with a more general report on sustainable development.
In the short term, it is important for us to be able to measure major parts of our impact on society, which we are doing by producing a sustainability report that follows the GRI framework for sustainability reporting. We believe that reporting pursuant to an internationally accepted framework is important to enable evaluation and comparison of various companies' impact on society. In the mid to long term, increased eorts with development and improvement are prioritized.
Environmental impact and the greenhouse eect are issues of continued importance. Byggmax's rst report on sustainable development focused on the environment. This is also an area where Byggmax can make a direct and indirect impact.
In 2013, work continued on reducing the environmental impact, and carbon emissions per ton of goods carried declined. Waste management at stores has developed well over time and the proportion of mixed waste declined from 11 percent in 2009 to 7 percent in 2013, in other words, sorted and rejected waste increased from 89 percent to 93 percent in 2013.
The goal for the next few years is to continue to improve in the prioritized areas. In 2013, this applies primarily to the environmental area, where we have a measurement method that has been established over a number of years."
Magnus Agervald, CEO
Byggmax's guidelines for social responsibility comprise a code of conduct for suppliers, ethical guidelines, environmental policy, work environment policy and equality policy. All policy documents are available in their entirety on Byggmax's website.
Byggmax's policy documents are based on the Global Compact and the OECD's guidelines for multinational companies. Below is an overview of the UN Global Compact's ten principles in the areas of human rights, labor, the environment and anti-corruption for companies, with reference to the documents and policies where the guidelines have been incorporated into Byggmax's operations.
Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights (Code of conduct for suppliers).
Principle 2: Businesses should make sure that they are not complicit in human rights abuses (Work environment policy, Equality policy).
Principle 3: Businesses should uphold the right to freedom of association and recognize the right to collective bargaining (Code of conduct for suppliers).
Principle 4: Businesses should uphold the elimination of all forms of forced and compulsory labor (Code of conduct for suppliers).
Principle 5: Businesses should uphold the eective abolition of child labor (Code of conduct for suppliers).
Principle 6: Businesses should uphold the elimination of discrimination in respect of employment and occupation (Work environment policy, Equality policy and Code of conduct for suppliers).
Principle 7: Businesses should support a precautionary approach to environmental challenges. Principle 8: Businesses should undertake initiatives to promote greater environmental responsibility. Principle 9: Businesses should encourage the development and diusion of environmentally friendly technologies.
Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery (Code of conduct for suppliers and Ethical guidelines).
The Byggmax set of values serves as a supplement to the above documents. All of these documents form part of the Byggmax work environment process, which ensures that these policy documents remain relevant for the organization.
Since Byggmax performs a minor portion of its procurement in Asia, about 5 percent, the risks associated with such procurements are relatively limited compared with if the proportion had been higher. However, these risks are
not negligible. The greatest opportunity for Byggmax to make an impact is in relation to the environment, speci cally, the transport of goods to stores.
The Annual Report contains various numerical measurements applicable to the company's impact on society. The measuring methods used are primarily the aggregate of actual outcomes at stores. When it is impractical to track outcomes per store, tracking is sometimes performed on an aggregate level. In some cases, a single product category has been selected for tracking. In such instances, it is necessary for Byggmax to be a relatively large buyer to be able to influence various supplier behaviors and, consequently, not all product categories are relevant.
To reconcile and support the measuring methods utilized, Byggmax has examined this summary and reporting based on the guidelines for sustainability reporting G3.0, produced by the international stakeholder organization the Global Reporting Initiative (GRI). This examination was performed by Tyréns AB, an external consulting rm.
Byggmax maintains contact with a number of stakeholder groups.These include customers, suppliers, employees, politicians, property owners, neighbors and shareholders to name but a few. The policy applied to select which stakeholders Byggmax will systematically communicate with has been to select those parties with which communication is frequent at present. A description follows of how Byggmax communicates with key stakeholders:
Customers: Through advertising, the website, customer service, employees in the store and Byggla. This communication is conducted on a daily basis.
Suppliers: Through the head oce via purchasing. This communication is conducted on a daily basis.
Employees: Via intranet, through the company's management structure and through training. This communication is conducted on a daily basis. In addition, an annual employee survey has been performed since 2011.
Politicians: Byggmax has relatively limited contact with political organizations and spokespersons. The company is a member of a European collaboration, EDRA, which has a number of contacts at EU level. EDRA has meetings two to four times per year at which Byggmax participates.
Owners: Byggmax submits nancial reports every quarter. In addition, the company participates in Small Cap meetings arranged by shareholder clubs three to ve times per year, meets investors in conjunction with the interim reports and invites shareholders to the annual general meetings.
Core issues for Byggmax stakeholders are dened as follows:
Customers: Product quality and price.
Suppliers: The stability of Byggmax as a customer. Employees: The stability and attractiveness of Byggmax as an employer.
Politicians: The stability of Byggmax as an employer and the Group's contribution to society as a whole.
Owners: Future dividends from Byggmax and sustainable business.
Over the past years, Byggmax has produced a structured environmental report. This was included in the Annual Report and extracts from it have been displayed on signs in stores. A number of Byggmax's owners who invested in conjunction with the stock exchange listing of Byggmax in 2010 have indicated that they would like to see a more complete review of the impact of Byggmax in line with the GRI framework
Byggmax does not conduct manufacturing operations but instead buys its products from some 200 carefully selected suppliers. The company's purchasing strives to nd products that hold high quality and which follow relevant standards.
The company has guidelines that cover work conditions and social responsibility in its own operations as well as in relationships with suppliers of products and services. The code of conduct complies with the UN's Global Compact and the OECD's guidelines for multinational companies. Suppliers are personally responsible for ensuring that their operations are pursued in line with the code of conduct and, when requested, must provide Byggmax with information concerning their sub-suppliers.
Byggmax's employees must fulll their undertakings in a manner that does not abuse the company's condence. This means, for example, that employees must not abuse corporate information, act in matters in which they are partial, or permit their personal undertakings to take precedence over their duty and responsibility to Byggmax.
In their capacity as employees at Byggmax, personnel must not oer, request or accept inappropriate gis, payments or trips for themselves or for relatives. Under no circumstances are employees at Byggmax to participate in any cartel or act in a manner that improperly curtails free competition.
Using active environmental programs, Byggmax promotes sustainable social development. Byggmax primarily impacts the environment through product transport, the environmentally hazardous content of packaging and products, printing and distribution of brochures, and through the energy consumption of business activities. The company takes environmental considerations into account in all decisions and at all levels of operations and endeavors to comply with applicable legislation and other environmental requirements.
Environmental programs are based on a life-cycle perspective and thus take into account the environmental impact throughout the product's entire value chain. The company pursues continuous dialog with suppliers and entrepreneurs and imposes relevant requirements. Byggmax also seeks to raise employee awareness of environmental issues and stimulates participation in environmental work. In addition, the share of green products will increase, supplemented by improvements in environmental information for customers. Environmental programs are based on an environmental policy with concrete objectives and measures for priority areas. The programs are assessed each year in an environmental report that measures the status and development in each area. The goal is to achieve improvement in priority areas from year to year.
The goals of Byggmax's systematic work environment programs are to prevent occupationally related illnesses and promote a good physical and psychosocial work environment. These eorts encompass the study of working conditions, risk assessment, implementation of preventive measures and the monitoring of business activities. To facilitate these programs, considerable eorts are made to ensure that all the company's executives undergo training in work environment-related programs and re safety.
The company endeavors to handle work environment
issues locally in the organization and make them a natural part of day-to-day activities. The CEO has primary responsibility for work environment programs and re safety in the organization. The regional managers are responsible for ensuring that store managers in their region have undergone training and that the established procedures are complied with. All store managers are responsible for safety, re safety and the work environment at their facilities and must ensure that all employees have received basic training in these issues, as well as access to current legislation and regulations in addition to the opportunity to participate in work environment programs.
Byggmax seeks to create an environment in which women and men – both as groups and individuals – jointly and equally create range and totality in operations. The company endeavors to create an awareness of gender and equality that permeates the entire organization and which forms a natural part of internal and external recruitment, pay setting and pay negotiations. Women and men have equal rights, obligations and opportunities within the framework of their employment at Byggmax. This applies both to the physical and psychosocial work environment.
The Byggmax GRI prole is available on page 88 with page references. Byggmax reports in line with the A+ level, which is the highest level under the GRI.
During 2009, Byggmax initiated its environmental program by creating an environmental policy with environmental goals. As a consequence of this policy, an environmental report has been produced and e orts were initiated to continuously achieve improvements to reduce Byggmax's negative impact on the environment.
Byggmax's main impact on the environment is de ned in the environmental policy as follows:
Byggmax's environmental policy stipulates yearly measurement of the status and trends in the aforementioned items, in the form of measures implemented and quantitative measurement where possible. The ambition is to improve every year in the areas speci ed above. The goal is a 25-percent reduction, per ton of goods transported, in emissions of carbon dioxide and other greenhouse gases between 2009 and 2020.
The calculation methods utilized and the format of the report are checked by an external consultant.
In spring 2013, parts of the warehouse operations in Lysekil were relocated to a new warehouse in the Port of Gothenburg, to separate freight that requires di erent forms of handling. In addition, some of the new flows were consolidated into Gothenburg in autumn 2013.
The relocation of parts of the warehouse operations resulted in more e cient flows with expanded po-
tential for direct deliveries compared with the warehouse operations in 2012. This can be seen in the statistics in Table 1 below. While total freight operations increased year-on-year, when measured per ton of transported goods, it decreased 15 percent. In parallel, carbon (CO2) emissions per ton of transported goods declined for the third successive year.
Compared with the year-earlier period,
volumes of goods transported by sea from Asia declined signi cantly, which is clearly reflected in the reduction in marine freight. While it is true that intra-European marine freight increased, since this pertains to signi cantly lighter goods and far shorter distances, the total impact on freight was negative.
| 2013 | 2012 | 2011 | Trend | Trend | |
|---|---|---|---|---|---|
| 2012-2013 | 2009-2013 | ||||
| Transported goods [thousand tons] | 521.5 | 484.1 | 467.0 | 8% | 32% |
| Freight [million ton-kilometers] | 319.1 | 347.2 | 360.6 | -8% | 17% |
| Of which marine [million ton-kilometers] | 56.2 | 88.9 | 90.4 | -37% | 19% |
| Share marine | 18% | 26% | 25% | 31% | 2% |
| Of which rail [million ton-kilometers] | 0.0 | 0.0 | 3.8 | 0% | 0% |
| Share rail | 0.0% | 0.0% | 1.1% | 0% | 0% |
| Of which road [million ton-kilometers] | 262.1 | 258.4 | 266.3 | 1% | 1% |
| Share road | 82% | 74% | 74% | 10% | -1% |
| Freight per ton [ton-kilometers/ton] | 612 | 717 | 772 | -15% | -11% |
| CO2 emissions per ton of goods transported [kg] | 30.0 | 32.7 | 35.2 | -8% | -14% |
| Absolute carbon emissions, CO2 [ton] | 15,662 | 15,816 | 16,426 | -1% | 13% |
Table 1, compilation of key freight ratios. Emissions per ton-kilometer are based on emission data from ntmcalc.se.
Emissions of other greenhouse gases and environmentally hazardous substances, per ton transported and in absolute gures, are presented in table 2 below. This category includes nitrogen oxides (NOx), hydrocarbons (HC), carbon monoxide (CO) and small particles.
| 2013 | 2012 | 2011 | Trend 2012-2013 | Trend 2009-2013 | |
|---|---|---|---|---|---|
| NOX [g/ton] |
256 | 285 | 286 | -11% | -14% |
| CO [g/ton] | 66.3 | 71.2 | 68.5 | -7% | -12% |
| HC [g/ton] | 11.1 | 12.4 | 12.4 | -11% | -13% |
| Particles [g/ton] | 6.1 | 7.1 | 7.2 | -15% | -13% |
| NOX [ton] |
133.4 | 138.7 | 133.4 | -4% | 14% |
| CO [ton] | 34.6 | 34.6 | 32.0 | 0% | 15% |
| HC [ton] | 5.8 | 6.1 | 5.8 | -4% | 14% |
| Particles [ton] | 3.2 | 3.5 | 3.4 | -8% | 14% |
Table 2, emissions of greenhouse gases and environmentally hazardous substances per ton of goods transported and in absolute measures. Emissions per ton-kilometer are based on emission data from ntmcalc.se.
For many, building their rst house is a far distant memory but, for Jonas and Hanna, this is everyday life. This includes all the things that planning, strong-willed relatives and compromises mean.
Hanna: "Originally, the house was a holiday home, so I was quick to draw up an extension. Now, it's become a bit of a social thing where both our families work together. Our dads would rather build from a purely functional viewpoint so if we want any sort of design aspect incorporated we have to negotiate. But with a little bit of charm we get our way."
Jonas: "It's been an intensive six months. We have always tried to do as much as possible and, as it's a big project, there are always things to do. We chose Byggmax, rst and foremost because it is as cheap as it is and because we get good quality building material."
Hanna: "We have been to Byggmax more o en than the grocery store. Now we need to prioritize where to spend the last of the money. I think it's important that we save money to get a nice kitchen, but Jonas wants a quad bike."
Jonas: "I suppose this could be a bit of a sticking point. Speed or a nice kitchen."
Hanna: "I know what it's going to be."
/ Hanna and Jonas
Clear improvements were posted compared with the year earlier and, again, a consistent positive trend was noted. The fact that total emissions of greenhouse gases and environmentally hazardous substances have increased since 2009 was attributable to the number of stores increasing from 61 to 105 over the corresponding period and to the stores' geographic spread now being substantially larger than it was four years ago.
The emissions calculations did not include online goods deliveries and home deliveries from stores. At present, such freight transportation comprises a relatively small portion of the company's total goods freight. An increasing proportion of online goods and home deliveries also reduces freight and emissions, in part through optimizing freight to end customers, and in part through customers ordering online and not utilizing their vehicles to go shopping.
Products and packaging a ect the environment directly and indirectly, for example, through the raw materials they contain, the energy consumed in their manufacture and in use, and to the extent to which they are recycled or reused at the end of their service life.
Byggmax works actively to promote the use of wood and thus reduce the use of less environmentally friendly material including concrete, cement and hard plastic. Byggmax only retails NTR-labeled pressure-treated lumber that complies with the environmental goals set by the Swedish Wood Preserving Association and the Nordic Wood Preservation Council. Lumber is procured from Nordic suppliers and in full loads directly from sawmills to minimize environmental impact. The proportion of primed wood interior and exterior cladding products has doubled compared with 2011. Interior and exterior cladding are, essentially, always painted when they are used and carrying this out in a controlled industrial environment has a smaller impact than painting on site at the consumer.
All parquet flooring and timber sold is labeled FSC, Forest Stewardship Council, the international environmental labeling that aims to promote sustainable forestry.
Byggmax handles goods with a low proportion of packaging. Only about 10 percent of articles sold in stores have consumer packaging, meaning packaging that is sold together with the goods and taken home by the customer. Otherwise, products have varying types of transport packaging for protection. Transport packaging is recycled in partnership with recycling centers and pallets are reused in the pallet exchange system of the major freight forwarders and in the building pallet exchange system.
Through membership in REPA, the producer part of the Packaging and Newspaper Collection Service tasked with ensuring that packaging and newspapers in Sweden are collected and recycled, Byggmax shoulders its responsibility as a producer for packaging on all brought-in and imported goods. For goods manufactured in Sweden, it is the producer that bears the producer responsibility, meaning that Byggmax indirectly defrays the costs for handling these products.
In Sweden, Byggmax has a broad collaboration with Ragn-Sells to ensure that as much of the stores' waste as possible is recovered and recycled as energy or new materials. The aim is to minimize the amount of waste that goes to land ll and achieve zero mixed waste.
The distribution of waste by category for Byggmax is shown in table 3 below. Overall, mixed waste has a declining trend, though an upward deviation was reported for the last year. In 2014, a system will be implemented to provide stores with faster and enhanced feedback regarding the distribution of waste by category.
| Waste | 2013 | 2012 | 2011 | Di' | Di' |
|---|---|---|---|---|---|
| category | 2012- | 2009- | |||
| 2013 | 2013 | ||||
| Mixed waste |
6.7% | 6.1% | 9.4% | 0.6% | -4.6% |
| To land'll | 7.6% | 7.0% | 6.5% | 0.6% | 1.7% |
| Sorted | 85.7% | 86.9% | 84.1% | -1.2% | 2.9% |
| Total | 100% | 100% | 100% |
Table 3, division of waste by category 2011, 2012 and 2013.
The printed matter produced and distributed by the Group is an important part of its environmental impact. Over a ve-year period – from 2009 to 2013 – Byggmax has reduced the volume of printed advertisements per store by almost 42 percent. This change was primarily attributable to new stores being established in existing distribution areas, which has signicantly cut the average volume of advertisements distributed per store.
The total weight of printed direct mail increased from 2012 to 2013. This was attributable, in part, to extra issues compared with previous years and, in part, to new stores in areas in Norway and Finland where we previously had no stores – for example, Bergen, Espoo and Tampere.
During the year, the printing partner for store material was changed to a partner with a better geographical and logistical location. Gi voucher cards have also been changed to wood-based versions.
Byggmax works together with printing rms that are certi ed in line with the Nordic Ecolabel, EU Ecolabel, PEFC and FSC. Among other measures, this means minimizing the use of health-impairing chemicals in printing ink and paper and striving to promote socially and economically sustainable forestry.
| Printed | 2013 | 2012 | 2011 | Trend | Trend |
|---|---|---|---|---|---|
| matter | 2012-2013 | 2009-2013 | |||
| Printed, | 1,105 | 950 | 1,028 | 16.3% | 0.5% |
| direct mail | |||||
| (tons) | |||||
| Printed, | 10.5 | 10.1 | 12.0 | 4.1% | -41.7% |
| direct mail | |||||
| (tons) |
Table 4, printed matter by weight 2011, 2012 and 2013 as well as the trend since 2009.
Byggmax endeavors to achieve energy eciency and all new stores constructed surpass the building regulations imposed in the respective countries. Prefabricated insulated facades and thermopane glass in the buildings' windows contribute to favorable energy utilization. Newly built stores have heat recycling integrated in the ventilation system and do not just rely on direct heating. In addition, new stores are built with LED lighting installed as the light source.
The direct energy used by Byggmax principally comprises fuel in the form of diesel and gasoline used in the organization's vehicles. These comprise diesel forklis, company cars and private cars used for work.
| Direct energy use (GJ) | 2013 | 2012 | 2011 |
|---|---|---|---|
| Diesel | 9,772 | 9,429 | 9,241 |
| Gasoline | 49 | 172 | 198 |
| Total | 9,821 | 9,501 | 9,438 |
| Per store | 94 | 101 | 110 |
Table 5, direct energy use by energy source, 2011-2013.
The fleet of forklis is gradually being renewed and all new forklis procured are of environmental class III, in accordance with the European Parliament directive 97/68/EU, and electric/diesel hybrids. About 65% of the forkli fleet are now either hybrid or electric. The possibility of changing to biodiesel has been examined but the volumes of diesel that Byggmax buys are too small for such a change to be nancially viable at present.
The indirect energy used by Byggmax per primary energy source mainly comprises electricity and heat.
In 2011, the electricity agreements were renegotiated in Sweden for the stores that do not have electricity included in lease agreements and the choice fell to guarantee-oforigin hydroelectricity from power stations in Ljusnan from 2012. In addition, 100 percent of the energy for the stores in Norway is also derived from renewable sources. In Finland, essentially, all stores have electricity included in their lease agreements and we are, accordingly, unable to
influence the source.
In collaboration with the electricity supplier, an initiative was carried out to identify and eliminate unnecessary grid loads in Byggmax stores in Sweden. All store managers were given energy e ciency training and receive reports of energy use and power usage.
| Total (TJ) |
Of which, renew able |
Of which, nuclear power |
Of which, fossil |
|
|---|---|---|---|---|
| energy | fuel | |||
| Sweden | 23.4 | 100% | 0% | 0% |
| Norway | 18.8 | 100% | 0% | 0% |
| Finland | 1,7 | i.n. | i.n. | i.n. |
Table 6, indirect energy use in total and by primary energy source in 2013 for stores where indirect use is possible to influence
A review was performed of Byggmax stores and their locations in relation to protected or valuable areas of nature. The county administrative boards' GIS database was used to provide basic data including the layers of data available that applied to areas of valuable and protected nature. The supporting data di ers between the various counties, but the most common types of nature protection are the same for all counties, areas of national interest and Natura 2000, nature reserves and national parks. In Norway, basic data has been collected from the Norwegian government site www.environment.no.
The store in Karlstad is located in an area designated in the Swedish national wetland inventory for biological diversity and is located in the vicinity of valuable water resources (meriting protection for sh and birds, water catchment, Natura
2000 and natural environment of national interest). Through its location, which is in a heavily developed area, the store has no impact on biological diversity in the area designated in the wetland inventory. The Torslanda store is located relatively close to an embankment protected inlet and known bird habitat. The store in Larvik, Norway, is located in the vicinity of important coastal biotopes. In general, stores located near the coast can be assumed to be more exposed to climate change.
Senior management has taken climate change and the risks and opportunities this entails for the organization into consideration. The major risks to the operation comprise physical changes (seasonal variations and flooding) as well as regulatory changes. The opportunities include better communication of Byggmax's environmental initiatives to create an environmental pro le toward customers and to launchproducts that are more environmentally-friendly than current products.
The Byggmax share was listed on June 2, 2010, on NASDAQ OMX Stockholm and is traded on the Mid Cap list.
The last price paid on December 31, 2013 was SEK 48.4, corresponding to a market capitalization for Byggmax of SEK 2,940 million. The highest price noted for the share during the scal year was SEK 53.8 and the lowest notation was SEK 29.2. In 2013, approximately 38 percent of trading in the Byggmax share took place on NASDAQ OMX Stockholm and only about 0.04 percent was carried out on Burgundy. The majority of share trading, 60 percent, comprised over-the-counter (OTC) trading. OTC trading is subsequently reported to, among others, Boat xo and the Stockholm Stock Exchange for registration.
The share capital in Byggmax Group AB (publ) amounted to SEK 20,245,682 divided among 60,737,045 shares with a quotient value of SEK 0.33 per share. Only one class of share exists and all shares have the same rights.
At December 31, 2013, the number of shareholders in Byggmax was 5,734 (4,839) according to Euroclear. The ten largest shareholders owned shares amounting to 58.3 percent of the votes and capital in the company. The percentage of non-Swedish ownership amounted to 68.1 percent.
Byggmax endeavors to furnish the stock market with clear and current information. Financial information is provided primarily in the Annual Report, the year-end report and in three interim reports. Before publication of the reports,
Byggmax maintains a quiet period of 30 days. Byggmax's annual report is only distributed via the Group's website, where it is possible to subscribe to the company's nancial reports.
The 2011 and 2013 annual general meetings resolved to introduce options programs for senior executives and other key sta at Byggmax. The options can be exercised in the nal six months of their term. The warrants are priced at market value, which is based on a valuation made by an independent party. Each warrant entitles its holder to subscribe for one share in the company at the exercise prices shown in the table below. The participants of the warrants program have entered into a pre-emption agreement.
| 2013 | 2011 | |
|---|---|---|
| Total number | 600,000 | 565,000 |
| Price | 2.24 | 6.77 |
| Exercise price | 42.8 | 63.9 |
| Term | 4.5 | 3.5 |
| No. of participants | 27 | 20 |
Byggmax policy is for dividends to amount to at least 50 percent of Byggmax's net prots for the preceding scal year, subject to Byggmax's need for capital, its EBIT, nancial position, capital requirements and economic conditions.
The Board of Directors proposes to the Annual General Meeting a dividend of SEK 2.3 (2.0) per share for 2013, equivalent to 76 percent (68) of the Group's prot aer tax.
| share perf0rmance | 2013 | 2012 |
|---|---|---|
| Earnings per share, SEK | 3.0 | 3.0 |
| Equity per share, SEK | 16.0 | 15.1 |
| Dividend per share, SEK | 2.3 | 2.0 |
| Cash flow from operations per share, SEK | 3.2 | 3.6 |
| Number of shares outstanding, thousands | 60,737 | 60,737 |
| Average number of shares, thousands | 60,737 | 60,737 |
| Dividend as a percentage of pro't ažer tax | 76% | 68% |
| Number of shareholders | 5,734 | 4,839 |
| Share price at December 31 | 48.4 | 29.0 |
| Direct return | 4.8% | 6.9% |
| Name | Number of shares | Holdings (%) |
|---|---|---|
| Altor 2003 Sarl | 11,920,908 | 19.63% |
| Nordea investment Funds | 5,199,190 | 8.56% |
| Lannebo fonder | 3,822,279 | 6.29% |
| Norges Bank Investment Management | 3,075,312 | 5.06% |
| Schroder Investment Management North America, Inc | 2,400,000 | 3.95% |
| Jarrton Management (Göran Petersson) | 2,381,296 | 3.92% |
| Öresund Investment AB | 1,952,039 | 3.21% |
| Ulslane Holdings (Lars Lindberg) | 1,715,000 | 2.82% |
| Zamgate Investments (Stig Notlöv) | 1,618,135 | 2.66% |
| Swedbank Robur fonder | 1,308,745 | 2.15% |
| Total of the ten major shareholders | 35,392,904 | 58.27% |
| Total other shareholders | 25,344,141 | 41.73% |
| Total at December 31, 2013 | 60,737,045 | 100.00% |
Source: Euroclear
For non-Swedish shareholders, the above data is based on available information.
It has been an intensive year for Byggmax, with increased market shares, the opening of 11 new stores, a new web platform and the testing of and decision to roll out an updated store concept, Byggmax 2.0. Naturally, these events characterized the Board's work and influenced the nancial situation.
Byggmax has a well-composed Board with members of varying and complementary backgrounds and skills. The Board held 11 meetings during the year. Important resolutions taken during the year included:
The evaluation of the Board's work concluded that it is e ective and goal-oriented.
As made evident in the Corporate Governance Report, Byggmax applies the Swedish Corporate Governance Code. The Audit Committee follows up the company's assessment of the internal audit through contact with the company's auditors.
Through its budget concept, Byggmax has historically strengthened its market position in a weaker economy. At year-end 2013, Byggmax held a strong position. Net pro t amounted to SEK 184 M (180). Shareholders' equity had increased from SEK 914 M in December 31, 2012 to SEK 970 M at December 31, 2013. Byggmax's nancial strength is important as it enables us to invest in the future. You can read more about our investments in the President's Comments.
I am very enthusiastic regarding the investments being made, with more stores in all of the countries and the forthcoming roll out of Byggmax 2.0.
Finally, I would like to show my appreciation to our Group management and all employees for a job well done in 2013.
Fredrik Cappelen Chairman of the Board
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The Board of Directors and President of Byggmax Group AB (publ), corporate registration number 556656-3531, with its registered oce in Stockholm and head oce in Solna, Stockholm, hereby submits its Annual Report for the scal year January 1, 2013 to December 31, 2013. Unless otherwise speci ed, all information applies to the Group. Information in brackets refers to the preceding year. All amounts are stated in SEK millions (SEK M) unless otherwise speci ed.
The Byggmax Group conducts sales of building supplies. The business concept is to retail high-quality building supplies at the lowest possible price. Business activities are conducted in Sweden, Norway and Finland. At the end of the period, there were 105 stores, of which 68 were in Sweden, 25 in Norway and 12 in Finland. In addition to the Byggmax stores, there is a service oce that manages the purchasing, accounting and nance as well as IT functions across the stores.
Byggmax Group AB's (publ) share is listed on NASDAQ OMX Stockholm. The principal shareholder in the company is Altor 2003 Sarl. At the end of the year, Altor 2003 Sarl divested part of its holding and, at December 31, 2013, owned 19.6 percent of the shares and capital. It has two representatives on the Board of Directors and, for this reason, is assessed as having signicant influence. A list of the ten largest shareholders is available on page 29.
Byggmax Group AB's (publ) share capital was SEK 20,245,682 and consists of 60,737,045 shares with a quotient value of SEK 0.33 per share. All shares have equal voting rights. The Articles of Association contain no preemption rights or other limitations on the share's assignability. No circumstances exist of the type the company has an obligation to report in accordance with the provisions in the Annual Accounts Act, chapter 6, section 2a, paragraphs 4-11.
The Byggmax Group's retail sales in Norway are conducted by the subsidiary Byggmax Norge and in Finland by the subsidiary Byggmax AB Finland.
Karlskoga. The divestment generated a positive earnings e¢ect, which was not signicant for the Group.
Net sales amounted to SEK 3,216.4 M, compared with SEK 3,090.4 M in the preceding year, which was an increase of 4.1 percent. Net sales in comparable stores declined 0.7 percent measured in local currency and currency e¢ects on sales were a negative 1.2 percent.
The gross prot margin amounted to 30.7 percent, compared with 30.2 percent for the preceding year. Personnel and operating expenses increased by a total of SEK 57.8 M. This was primarily due to costs of SEK 47.9 M incurred for new stores that were not open in the year-earlier period. In addition, Byggmax has increased manning at the head oce, primarily due to the investment in e-commerce and web marketing. Total costs for Byggmax 2.0 amounted to SEK 6.5 M in 2013. These costs were attributable to both the conversion of stores and general project expenses. At December 31, 2013, Byggmax had a total of 18 stores with the Byggmax 2.0 concept in place, seven of which were conversions of existing stores and 11 newly opened stores in 2013. Moving forward, the total investment to convert a store is expected to be around SEK 1.6 M and conversion is expected to lead to about SEK 0.6 M tied up in inventory, which is partly nanced by an increase in accounts payable.
EBIT before depreciation amounted to SEK 304.1 M (305.6), a decline of -0.5 percent year-on-year. The EBIT margin excluding depreciation was 9.5 percent (9.9).
Cash flow from operations amounted to SEK 192.5 M (220.5), down SEK 28.0 M year-on-year. At the end of the scal year, inventory amounted to SEK 538.3 M (465.8). Compared with the same period in the preceding year, 11 new stores were added, and inventory in the new stores amounted to SEK 52.2 M. Distribution inventory was SEK 11.1 M higher than in the year-earlier period. Inventory turnover was a multiple of 4.6 (4.8) during the scal year. Investments during the year (including nancial leasing) totaled SEK 82.2 M (83.6). Consolidated shareholders' equity amounted to SEK 970.0 M (914.2) on December 31, 2013. The net debt of the Group
was SEK 477.0 M (466.8) and increased SEK 10.2 M year-onyear. Net debt in relation to EBITDA amounted to a multiple of 1.6 (1.5). The equity/assets ratio amounted to 49.9 percent (49.3).
The Swedish Customs decided to levy an additional charge on Byggmax with respect to customs and anti-dumping duties for 2010. In spring 2013, the Swedish Customs reviewed the decision regarding customs and anti-dumping duties and reduced the total amount by SEK 3.2 M. The total sum a¦er the review was SEK 29.3 M. Byggmax has appealed parts of the decision. Byggmax has agreed compensation in a corresponding amount with the supplier that sold the products in question to Byggmax. In total, Byggmax paid a total of SEK 23.2 M in customs and anti-dumping duties and exposure to the supplier amounts to a total of SEK 21.8 M at December 31, 2013.
Just as in any other business, Byggmax's business activities are associated with risks. The management of risks is of fundamental signicance for the Group's success. Some of the risk factors and signicant relationships that are assessed as being of signicance for Byggmax's business activities, nancial position and performance are shown below.
• Expansion of the chain of stores is greatly dependent on the ability to locate plots and properties that are suitable for Byggmax
| Change (percentage point) all other fac |
E"ect on pro t (SEK M) a"er |
|
|---|---|---|
| tors unchanged | tax 2013 | |
| Cost price | +1% | -17.4 |
| Personnel costs | +1% | -2.4 |
Risk management is performed by the nance department in accordance with the nance policy set annually by the Board of Directors. A more detailed description of the Group's nancial risks and risk management is available in Note 3 among supplementary disclosures.
The above diagram displays the identified risks and their likelihood as well as the size of the long-term impact.
Byggmax's business activities are strongly a¢ected by seasonal variations steered by consumer demand for standard building materials. Due to the weather's e¢ect on demand, Byggmax's sales and cash flow are normally higher during the second and third quarters when approximately twothirds of Byggmax's sales are generated and subsequently decline in the fourth and rst quarters. Although seasonal variations do not normally a¢ect Byggmax's earnings and cash flow from year to year, earnings and cash flow may be impacted during the year by unusually harsh or mild weather conditions, or by excessive or insucient precipitation. Byggmax strives to balance the seasonal e¢ects by, for example, launching new products throughout the year that are not as susceptible to seasonal variations.
The average number of employees, (full-time employees) totaled 629 (574). Further information about employees can be found in Note 9 of the Annual Report.
Operations will continue to expand through the opening of new stores in Sweden, Norway and Finland and through the renement and enhancement of existing stores. Over time, Byggmax will increase its presence in Sweden to about 95 stores, in Norway to about 60 stores and in Finland to about 25 stores. The Board of Directors expects a continued positive sales trend. Byggmax does not provide forecasts for competitive reasons.
Byggmax mainly a¢ects the environment through transportation of products from manufacturers to stores or warehouses and from stores to customers as well as through products containing substances that impact the environment and through product packaging. Byggmax strives to minimize its impact on the environment and comply with environmental requirements according to Swedish legislation. The environmental e¢ort is conducted through such measures as a continuous dialog on environmental issues with our suppliers and contractors and by imposing relevant requirements. Byggmax works to increase the proportion of environmentally friendly products and to improve environmentally oriented information to customers. Byggmax's environmental report is included in the Annual
Report (see page 23).
Guidelines for compensation to senior executives Pursuant to a motion to the 2014 Annual General Meeting (AGM), the following guidelines apply until the 2015 AGM. The guidelines are to apply for employment contracts that are entered into a¦er the Meeting's resolutions and in cases in which amendments are made to existing agreements a¦er the Meeting's resolutions.
The overriding principles for compensation to senior executives are to be based on position, individual performance, the Group's EBIT and for compensation to be competitive in the country of employment. Total compensation to senior executives consists of xed salary, variable salary in the form of short-term incentives based on annual performance targets, long-term incentives based on performance over several years, pension and other benets. In addition, there are conditions relating to termination and severance pay. Fixed salaries should be set below market averages. However, overall remuneration, including short-term incentives and long-term incentives, entails that the market average may be exceeded. The combined remuneration must be reviewed annually to ensure that it is in line with the market and competitive. When making comparisons, position, the company's size, salary and the person's experience must be taken into consideration.
Fixed salaries form the basis for total compensation. Fixed salaries must be related to the relevant market and reflect the scope of responsibility that the work entails.
In addition to xed salary, senior executives are able to receive STIs for results that exceed one or more predened performance levels during a scal year. Compensation from the STI program can amount to a maximum of 100 percent of the xed salary for the President and 30 percent of xed salaries for the remaining management, thus enabling Byggmax to calculate maximum levels of variable remuneration. STIs are determined by both qualitative and quantitative measures.
The 2011 and 2013 general meetings resolved to introduce a warrants-based incentive program. The incentive program is described in Note 9 of the Annual Report. No new incentive program is proposed for the 2014 AGM.
Where possible, pension agreements should be premium-based and designed in accordance with the levels and practices applicable in the country where the senior executive is employed.
Other benets may be provided in accordance with the conditions that apply in the country where the senior executive is employed. However, the extent of such benets must be limited as much as possible and may not comprise a major portion of the total compensation.
Senior executives are to be o¢ered terms of employment according to the prevailing legislation and practices in the country in which the senior executive is employed. During the notice period, the senior executive is prohibited from working for a competing business. In certain cases, a prohibition of competition may be applied in exchange for continued remuneration for a maximum of 24 months a¦er the end of the notice period. Currently, the longest notice period in the Byggmax Group is 12 months and no contract includes severance pay.
The Board has the right to deviate from the aforementioned guidelines if the Board deems that it is motivated in speci c cases.
The above guidelines are unchanged compared with the guidelines adopted by the 2013 AGM, with the exception that no proposed incentive program is included in the proposal.
Refer to Note 9 for further information on senior executives.
In compliance with the Swedish Annual Accounts Act, chapter 6, section 8, Byggmax prepares a Corporate Governance Report, which is included in the Administration Report on pages 36-39.
No signi cant events have occurred since the end of the scal year.
Byggmax Group AB is a holding company. Operations are conducted in the subsidiary Byggmax AB (Corp. Reg. No. 556645- 6215), in the subsidiary Byggmax Fastighetsutveckling AB (Corp. Reg. No. 556726-8593), in a subsidiary to that company, Byggmax Fastighetsholding AB (Corp. Reg. No. 556726-8601), and in Svea Distribution AB (Corp. Reg. No. 556602-5895). Byggmax Group AB (publ) did not have any employees during the year. For 2013, the Parent Company has an anticipated dividend of SEK 100 M from Byggmax AB
Byggmax's dividend policy is presented in greater detail under the "Byggmax share" on page 28. The following earnings in the Parent Company are at the disposal of the Annual General Meeting:
| Earnings brought forward | 107,626,884 |
|---|---|
| Pro" t for the year | 99,999,045 |
| TOTAL | 207,625,929 |
| The Board of Directors and the President propose that these earnings be distribu ted such that: |
|
| Dividend to shareholders (SEK 2.3 per share) |
139,695,204 |
| To be carried forward | 67,930,725 |
| TOTAL | 207,625,929 |
Byggmax Group AB's (publ) aim is that dividends to shareholders comprise a minimum of 50 percent of the net pro t for the year, subject to Byggmax's need for capital, its EBIT, nancial position, capital requirements and the prevailing economic conditions.
The Board has examined the Parent Company's and the Group's nancial positions and nds that a dividend in accordance with the Board's proposal is justi able in respect of the prudence concept in Chapter 17, section 3, second and third paragraphs of the Swedish Companies Act (2005:551). The opinion of the Board is that the character, scope and risks of the business are currently of such an extent that the proposed dividend does not a¢ ect the above assessment.
A¦ er payment of the proposed dividend, the Parent Company and the Group will still retain a healthy equity/assets ratio, which in the opinion of the Board corresponds with those requirements that can be set at present for the industry in which the Group operates. A¦ er payment of the proposed dividend, the liquidity of the Parent Company and Group is deemed satisfactory and their consolidation needs as met.
The Board of Directors is of the opinion that the proposed distribution of pro ts will not lead to any material limitation of the company's or Group's ability to make any necessary investments or to meet their obligations in the short and long term. Nor is the proposed value transfer expected to impact the company's ability to make any necessary investments.
On overall assessment of the Parent Company's and the Group's nancial positions, the Board nds no obstacles to the proposed distribution of pro ts in line with the Board's proposal.
Byggmax Group AB (publ) is a Swedish public limited liability company listed on NASDAQ OMX Stockholm. Byggmax applies the Swedish Corporate Governance Code and hereby submits its Corporate Governance Report for the scal year January 1, 2013 to December 31, 2013. Byggmax has prepared the Corporate Governance Report in accordance with the Swedish Annual Accounts Act (1995:1554) and the Swedish Corporate Governance Code. The guidelines for the Swedish Corporate Governance Code are available from the website of the Swedish Corporate Governance Board (www.corporategovernanceboard.se). The Corporate Governance Report is included as part of the Administration Report.
Corporate governance means the rules and regulations as well as the existing structure for managing and leading business activities in a limited company with an ecient and controlled approach. Ultimately, corporate governance aims to meet shareholder requirements in respect of return and to provide all stakeholders with adequate and correct information about the company and its development.
The Byggmax Group AB (publ), hereina¦er called Byggmax or the company, is listed on NASDAQ OMX Stockholm and applies the Swedish Corporate Governance Code (the Code) from the date of its listing, which was June 2, 2010. The Code builds on the principle "comply or explain," which means that companies that apply the Code can deviate from specic rules but must explain the underlying reasons behind the deviation. Byggmax has made the following deviations from the Code:
• The Board has elected not to have a separate internal audit since the company has a straightforward legal and operational structure, and comprehensive management and internal control systems.
The share capital in Byggmax amounted to SEK 20,245,682 divided among 60,737,045 shares. Only one class of shares exists and all shares have equal rights to participation in the company's assets and prots. The number of shareholders on December 31 was 5,734. Altor 2003 Sarl is the largest shareholder and has a holding equivalent to 19.6 percent. Non-Swedish owners accounted for ownership of approximately 68.1 percent of the shares. For further information regarding the share and shareholders please see pages 28-29 and the Byggmax website.
Shareholders exercise their influence over the company at the Annual General Meeting (AGM) which constitutes the company's highest decision-making body. Byggmax's Articles of Association are available in their entirety at byggmax.com.
The 2013 AGM was held on May 15, 2013, at the Primus conference center in Stockholm. At the AGM, 77 shareholders representing 76.7 percent of the votes were present either in person or via representatives. Fredrik Cappelen was elected Chairman of the AGM.
The main resolutions passed were as follows:
President and other senior executives
• Policies for the appointment of the Nomination Committee
The next AGM for shareholders in Byggmax will be held on Thursday, May 8, 2014, at the Primus conference center in Solna (Stockholm) from 10:00 a.m. to 12:00 a.m. For further information regarding the AGM, please visit the Byggmax website.
The AGM on May 15, 2013, resolved that a Nomination Committee would be appointed for the 2014 AGM. The Chairman will convene the three largest owner-categorized shareholders of the company – according to Euroclear Sweden AB as of August 31 – who will subsequently each be entitled to appoint a member to the Nomination Committee. The composition of the Nomination Committee will be published not later than six months prior to the AGM. The Nomination Committee is to prepare and submit proposals to the General Meeting of Shareholders concerning a Chairman for the AGM, the Chairman of the Board of Directors and other members of the company's Board. The Nomination Committee is also tasked with submitting proposals for directors' fees that are to be allocated among the Chairman and other members, the election of (where applicable) and fees to auditors, as well as decisions on principals governing the appointment of the Nomination Committee's members. No remuneration is payable to members of the Nomination Committee.
The Board's formal work plan and written instructions
Each year, the Byggmax Board of Directors adopts a formal work plan and written instructions in respect of nancial reporting and allocation of duties between the Board and the President. The formal work plan regulates the Board's obligations, division of work among Board members, the minimum number of Board meetings per year, notice of and documents before Board meetings and the preparation of the minutes of Board meetings.
Written instructions regulate the reporting system that exists to enable the Board to continuously assess the company's and the Group's nancial situations and the allocation of work between the Board and the President.
The Board's assessment of the individual Board members relation to the company and the shareholders is dened in the table "The Board's composition and attendance at meetings" (See page 38). As is made evident, Byggmax meets the Code's requirement that the majority of the elected Board members are independent of the company and the Group management and that at least two of these are independent of the company's major shareholders.
The Board's composition and attendance at meetings A detailed description of the Board members is available on page 77 and the Board's composition and attendance at Board meetings is presented on page 38.
The Board held 11 meetings in 2013. Important issues addressed by the Board in 2013, in addition to the adoption of the Annual Report and interim reports, and the business plan and attendant budget, included the following:
The Group's President, Magnus Agervald, and CFO, Pernilla Walfridsson, participate at Board meetings. Other employees may also participate in Board meetings to present specic issues.
Evaluation of the work of the Board of Directors in 2013 The Chairman of the Board is responsible for evaluating the work of the Board including the input of the individual Board members. The evaluation focuses on the supply and demand of specic competence and ways of working. In 2013, an external company was engaged to carry out a thorough evaluation of the Board's members and work. The evaluation of the work of the Board concluded that the work is ecient and goal oriented. The external company used also completed an evaluation of members of the Group management and the assessment was that the management functions well.
The Board currently has no separate remuneration committee or audit committee. It is the Board's belief that the tasks that would otherwise be performed by committees can be carried out more e¢ectively by the Board in its entirety.
The Board, as a whole, prepares and addresses issues regarding remuneration and other employment terms for senior executives. The audit committee is comprised by the Board in its entirety. The committees/Board meet the company's auditors twice yearly to discuss matters including audit plans and audit reports. At meetings with the company's auditors, the committees/Board are given the opportunity to meet with the auditor without the President being present.
The President, also CEO, is tasked with managing the ongoing operation of the company in accordance with the written instructions adopted by the Board. Magnus Agervald has been the President and CEO of Byggmax since January 1, 2008. He has no shareholding or partnership in any company that the company has a signicant business relationship with.
The Byggmax Group management comprises six members including the President. A description of the management is available from the Annual Report under the heading "Byggmax Group Management" (page 76).
For information concerning salaries and other remuneration to the President and other senior executives see Note 9, page 60.
The AGM appoints the company's auditors every four years (from the 2014 AGM, on an annual basis). Öhrlings PriceWaterhouseCoopers, hereina¦er called PWC, was elected by the 2010 AGM for a mandate period of four years. PWC has appointed Authorized Public Accountant Anna-Carin Bjelkeby as principal auditor for the audit. As Ms. Bjelkeby had held this assignment for seven years, in autumn 2013, Ann-Christine Hägglund was appointed the new principal auditor for the audit. In addition to the audit assignment, Byggmax has consulted PWC on taxes and other accounting issues. PWC is obligated to test its independence prior to accepting independent advisory assignments in addition to its auditing assignments for Byggmax. Information in respect of the fees paid to the auditing company is provided in Note 8. According to the Code, the company's Board should ensure that the interim report in respect of the second or third quarter is reviewed by the auditors. Byggmax's auditors conducted a review of the company's ninemonth interim report.
The company has a simple legal and operative structure and a comprehensive management and internal control system. The Audit Committee follows up the company's assessment of the internal audit through contact with the company's auditors. In view of the aforementioned, the Board has opted not to have a separate internal audit. The question of whether to establish a separate internal audit function will be retested on an annual basis.
The Board's responsibility for internal control is regulated by the Swedish Companies Act and in the Swedish Corporate Governance Code, which contains requirements for annual external disclosures regarding the organization of internal control for nancial reporting.
The Board has overriding responsibility for internal control at Byggmax. The President has the ongoing responsibility for maintaining internal governance and controls. The ultimate aim of internal control is to ensure that Byggmax's nancial reports are prepared in accordance with the law, applicable accounting policies and other requirements that apply to listed companies, in addition to protecting Byggmax's assets. Byggmax has elected to use COSO's denition of internal control as the foundation for its work with internal control. According to COSO, internal control comprises ve di¢erent parts; the control environment, risk assessment, control activities, information and communication, and follow-up. These various parts are described briefly below.1
The control environment forms the basis for the internal control and builds on the culture that the Board of Directors and management communicate and work by. It primarily comprises values, competence, management philosophy, organizational structure, responsibility and authorizations as well as policies and routines. A key component of the control environment is the clear denition and communication of decision paths, authorizations and responsibility between di¢ering levels in the organization and that steering documents in the form of internal policies and guidelines include all material areas and that these provide guidance to the various employees of Byggmax.
A key component of the Board's work is the preparation and approval of a number of policies including the rules of procedure for the Board of Directors, the President's instructions, nancial policy, IT policy, information policy and the logbook and insider policy. The aim of these policies includes creating the foundation for acceptable internal control. All policies are reported annually and adopted by the Group management or Board. Byggmax's accounting process is documented in an accounting manual.
All business activities are linked to a certain degree of risk taking. A structured risk assessment enables the identication of signi cant risks. Byggmax operates an ongoing process of risk analysis in which the risks of errors in the nancial reporting of signicant income statement and balance sheet items are analyzed. Other risks in conjunction with the nancial reporting include the risk of fraud, loss or misappropriation of assets. The Board of Byggmax continuously assesses the company's risk management. This includes assessing the preventative measures taken to reduce the company's risks, which entails ensuring the company is appropriately insured and that the company has the requisite policies and guidelines in place.
The Group's control structure is designed to handle the risks the Board assesses as being signicant for the internal control of nancial reporting. In Byggmax, the control structures comprise an organization with clear roles that enables an ecient, and from an internal control perspective, suitable allocation of responsibilities, and additionally of specic control activities that are aimed at identifying or safeguarding from the risks of errors in the reporting. Byggmax has a systematic modus operandi to minimize the risk of fraud and/or the¦, this includes e¢orts to minimize waste in the stores.
Byggmax has an information policy that includes guidelines for internal and external information from the company. External information is disclosed in compliance with stock exchange and securities legislation and the Swedish Financial Supervisory Authority's regulations. Internal dissemination of price-sensitive information occurs only a¦er Byggmax has released the corresponding information to the stock market. Steering documentation in the form of policies, guidelines and manuals are communicated via the Group's intranet and accounting manual.
The Group's accounting functions are integrated via a joint accounting and reporting system. The Board and Group management are provided with ongoing information in respect of the Group's nancial performance, situation and development of the business. The reports also contain analytical follow-ups, trend monitoring and benchmarking between stores. The accounting function has the same procedures and requirements of documentation at every monthly accounts date. The Board continuously evaluates the information provided by the Group management. The work includes ensuring that measures are taken in respect of faults and proposed measures that may have been identied in the external audit.
1 COSO (Committee of Sponsoring Organizations of the Treadway Commission), which is the framework that has the widest spread and international acceptance, and which takes a particular position on the denition of accepted internal control.
| 20131 | 20121 | 20111 | 20101 | 20091 | 20081 | 20082 | |
|---|---|---|---|---|---|---|---|
| Results, SEK M | |||||||
| Net sales | 3,216.4 | 3,090.4 | 2,987.1 | 2,773.0 | 2,443.5 | 2,107.0 | 2,107.0 |
| EBITDA | 304.1 | 305.6 | 323.0 | 314.0 | 306.7 | 181.6 | 163.5 |
| EBITA | 246.7 | 252.2 | 277.5 | 274.8 | 272.7 | 153.0 | 148.3 |
| EBIT | 246.7 | 252.2 | 277.5 | 274.8 | 272.7 | 153.0 | 86.3 |
| Pro"t before tax | 237.9 | 231.5 | 251.6 | 237.4 | 203.9 | 51.8 | 1.6 |
| Income tax | -53.9 | -51.7 | -69.5 | -65.2 | -42.7 | -11.6 | -15.5 |
| Pro t for the year |
184.0 | 179.8 | 182.2 | 172.2 | 161.2 | 40.2 | -13.9 |
| Net sales growth, % | 4.1 | 3.5 | 7.7 | 13.5 | 16.0 | 19.0 | 19.0 |
| Like-for-like (LFL) sales growth, % | -0.7 | -2.7 | -1.9 | 2.7 | 6.0 | 1.3 | 1.3 |
| Gross margin, % | 30.7 | 30.2 | 30.1 | 29.7 | 29.8 | 28.2 | 28.2 |
| EBITDA margin, % | 9.5 | 9.9 | 10.8 | 11.3 | 12.5 | 8.6 | 7.7 |
| EBITA margin, % | 7.7 | 8.2 | 9.3 | 9.9 | 11.2 | 7.3 | 7.0 |
| EBIT margin, % | 7.7 | 8.2 | 9.3 | 9.9 | 11.2 | 7.3 | 4.1 |
| Interest coverage ratio, % | 21.0 | 18.9 | 19.7 | 13.3 | 8.2 | – | – |
| Balance sheet, SEK M | |||||||
| Assets | |||||||
| Fixed assets | 1,299.6 | 1,266.5 | 1,218.2 | 1,207.4 | 1,181.6 | 1,186.4 | 1,064.8 |
| Inventories | 538.3 | 465.8 | 424.9 | 350.5 | 295.0 | 232.7 | 232.7 |
| Other current assets | 73.8 | 87.3 | 99.8 | 70.0 | 98.0 | 55.8 | 57.0 |
| Cash and cash equivalents | 33.1 | 33.9 | 22.8 | 34.1 | 31.6 | 124.6 | 124.6 |
| 1,853.5 | 1,765.8 | 1,662.0 | 1,606.3 | 1,599.5 | 1,479.0 | ||
| Total assets | 1,944.8 | ||||||
| Shareholders' equity and liabilities | |||||||
| Shareholders' equity | 970.0 | 914.2 | 844.4 | 748.5 | 337.8 | 174.5 | 86.9 |
| Long-term interest-bearing liabilities | 0.0 | 0.0 | 130.0 | 239.3 | 765.3 | 9265 | 1,009.7 |
| Long-term non-interest-bearing liabilities | 84.1 | 82.4 | 100.8 | 53.6 | 58.4 | 41.0 | 21.9 |
| Current interest-bearing liabilities | 504.3 | 483.5 | 344.0 | 240.0 | 71.3 | 106.8 | 0.0 |
| Accounts payable | 284.7 | 278.7 | 268.9 | 268.9 | 285.6 | 302.2 | 302.2 |
| Other current liabilities | 101.7 | 94.7 | 77.7 | 111.7 | 88.0 | 48.5 | 58.4 |
| Total liabilities and shareholders' equity | 1,944.8 | 1,853.5 | 1,765.8 | 1,662.0 | 1,606.3 | 1,599.5 | 1,479.0 |
| Operating capital | 1,447 | 1,381 | 1,332 | 1,194 | 1,143 | 1,083 | 972 |
| Operating capital less goodwill | 396 | 330 | 281 | 143 | 98 | 39 | -10 |
| Net debt | 477 | 467 | 488 | 445 | 805 | 909 | 885 |
| Return on operating capital, % | 17.4 | 18.6 | 22.0 | 23.5 | 24.3 | – | 14.1 |
| Return on operating capital less goodwill, % | 68.0 | 82.6 | 131.0 | 228.2 | 347.2 | – | 366.8 |
| Return on equity, % | 19.5 | 20.4 | 22.9 | 31.7 | 62.9 | 29.6 | -15.1 |
| Net debt/EBITDA | 1.6 | 1.5 | 1.5 | 1.4 | 2.6 | 5.0 | 5.4 |
| Average net working capital, % of net sales | 1.4 | 0.5 | -1.5 | -3.0 | -2.8 | -2.4 | -2.4 |
| Equity/assets ratio/risk-bearing capital, % | 49.9 | 49.3 | 47.8 | 45.0 | 49.5 | 37.1 | 36.5 |
| Per share data | |||||||
| Equity per share, SEK | 16.0 | 15.1 | 13.9 | 12.3 | 6.1 | 3.2 | 1.6 |
| Earnings per share, SEK | 3.0 | 3.0 | 3.0 | 2.8 | 2.9 | 2.2 | -0.8 |
| Dividend per share, SEK | 2.3 | 2.0 | 1.8 | 1.5 | – | – | – |
1) The International Financial Reporting Standards (IFRS) 2) The Swedish Accounting Standards Board (BFN)
| Amounts in SEK M | Note | 2013 | 2012 |
|---|---|---|---|
| Operating income | |||
| Net sales | 5 | 3,216.4 | 3,090.4 |
| Other operating income | 6, 12, 18 | 6.6 | 7.2 |
| Total operating income | 3,223.0 | 3,097.6 | |
| Operating expenses | |||
| Goods for resale | 34 | -2,227.6 | -2,158.6 |
| Other costs | 7, 8, 12, 18, | -382.2 | -360.9 |
| Personnel costs | 33, 34 9, 29 |
-309.1 | -272.6 |
| Depreciation, amortization and impairment of tangible | |||
| and intangible "xed assets | 13, 14 | -57.4 | -53.4 |
| Total operating expenses | -2,976.3 | -2,845.4 | |
| EBIT | 246.7 | 252.2 | |
| Pro"t from participations in Group companies | 0.4 | 0.0 | |
| Financial income | 12 | 13.9 | 15.9 |
| Financial expenses | 12 | -23.1 | -36.6 |
| Pro t/loss from nancial items |
10 | -8.7 | -20.7 |
| Pro t before tax |
237.9 | 231.5 | |
| Income tax | 11 | -53.9 | -51.7 |
| Pro t for the year |
184.0 | 179.8 | |
| Other comprehensive income for the period | |||
| Items not to be reversed in pro"t or loss | 0.0 | 0.0 | |
| 0.0 | 0.0 | ||
| Items that will later be reversed in pro"t or loss | |||
| Translation di¢erences | -6.7 | -0.6 | |
| Other comprehensive income for the period | -6.7 | -0.6 | |
| Comprehensive income for the period | 177.3 | 179.2 | |
| Earnings per share before dilution, SEK | 3.0 | 3.0 | |
| Earnings per share a"er dilution, SEK | 3.0 | 3.0 | |
| Average number of shares, thousands, before dilution | 60,737 | 60,737 | |
| Average number of shares, thousands, a"er dilution | 61,337 | 60,737 | |
| Number of shares outstanding at end of period | 60,737 | 60,737 |
The prot and the total comprehensive income for the year are attributable in their entirety to Parent Company shareholders.
| Amounts in SEK M | Note | Dec. 31, 2013 | Dec. 31, 2012 |
|---|---|---|---|
| ASSETS | |||
| Fixed assets | |||
| Capitalized expenses for development work | 5, 13 | 30.4 | 27.9 |
| Goodwill | 5, 13 | 1,051.0 | 1,051.0 |
| Land and buildings | 5, 14 | 28.7 | 34.9 |
| Leasehold improvements | 5, 14 | 10.9 | 6.6 |
| Equipment, tools, "xtures and "ttings | 5, 14 | 154.3 | 133.3 |
| Deferred tax assets | 28 | 1.6 | 1.7 |
| Other long-term receivables | 22.6 | 11.1 | |
| Total xed assets |
1,299.6 | 1,266.5 | |
| Current assets | |||
| Inventories | 21 | 538.3 | 465.8 |
| Work in progress on behalf of another party | 21 | 0.0 | 0.0 |
| Prepayments to suppliers | 21 | 0.0 | 0.1 |
| Accounts receivable | 20 | 1.9 | 7.9 |
| Derivatives | 19 | 0.8 | 0.5 |
| Current tax assets | 2.8 | 0.0 | |
| Other receivables | 22 | 40.0 | 51.5 |
| Prepaid expenses and accrued income | 23 | 28.2 | 27.2 |
| Cash and cash equivalents | 24 | 33.1 | 33.9 |
| Total current assets | 645.2 | 587.0 | |
| TOTAL ASSETS | 1,944.8 | 1,853.5 |
| Amounts in SEK M | Note | Dec. 31, 2013 | Dec. 31, 2012 |
|---|---|---|---|
| SHAREHOLDERS' EQUITY | |||
| Capital and reserves that can be attributed to the Parent Company's owners |
|||
| Share capital | 25 | 20.2 | 20.2 |
| Other capital contributions | 25 | 441.0 | 441.0 |
| Reserves | 26 | -8.4 | -1.7 |
| Earnings brought forward including pro"t for the year | 517.1 | 454.6 | |
| Total shareholders' equity | 970.0 | 914.2 | |
| LIABILITIES | |||
| Long-term liabilities | |||
| Borrowing from credit institutions | 27 | 5.8 | 17.2 |
| Derivative instruments | 19 | 0.0 | 0.0 |
| Deferred tax liabilities | 28 | 78.4 | 65.2 |
| Total long-term liabilities | 84.1 | 82.4 | |
| Current liabilities | |||
| Borrowing from credit institutions | 27 | 504.3 | 483.5 |
| Accounts payable | 34 | 284.7 | 278.7 |
| Current income tax liabilities | 0.0 | 3.8 | |
| Derivative instruments | 19 | 0.0 | 0.0 |
| Other liabilities | 30 | 24.9 | 20.7 |
| Accrued expenses and deferred income | 31 | 76.7 | 70.3 |
| Total current liabilities | 890.7 | 856.9 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 1,944.8 | 1,853.5 | |
| Pledged assets - shares in subsidiaries | 1,100.2 | 1,022.9 | |
| Pledged assets - chattel mortgages | 120.0 | 120.0 | |
| Pledged assets - blocked bank funds | 8.4 | 10.3 | |
| Contingent liabilities | None | None |
| Attributable to shareholders in Parent Company | ||||||
|---|---|---|---|---|---|---|
| Amounts in SEK M | Note 25, 26 |
Share capital |
Other capital contributions |
Reserves | Earnings brought forward |
Total share holders' equity |
| Opening balance at January 1, 2012 | 20.2 | 441.0 | -1.1 | 384.1 | 844.4 | |
| Pro"t for the year | 179.8 | 179.8 | ||||
| Other comprehensive income for the year | ||||||
| Translation di¢erences | -0.6 | -0.6 | ||||
| Total comprehensive income | 20.2 | 441.0 | -0.6 | 563.9 | 1,023.5 | |
| New issue/share premium reserve | ||||||
| Dividend1 | -109.3 | -109.3 | ||||
| Total transactions with shareholders | 0.0 | 0.0 | 0.0 | -109.3 | -109.3 | |
| Closing balance at December 31, 2012 | 20.2 | 441.0 | -1.7 | 454.6 | 914.2 | |
| Opening balance at January 1, 2013 | 20.2 | 441.0 | -1.7 | 454.6 | 914.2 | |
| Pro"t for the year | 184.0 | 184.0 | ||||
| Other comprehensive income for the year | ||||||
| Translation di¢erences | -6.7 | -6.7 | ||||
| Total comprehensive income | 20.2 | 441.0 | -6.7 | 184.0 | 177.3 | |
| New issue/share premium reserve | ||||||
| Dividend2 | -121.5 | -121.5 | ||||
| Total transactions with shareholders | 0.0 | 0.0 | 0.0 | -121.5 | -121.5 | |
| Closing balance at December 31, 2013 | 20.2 | 441.0 | -8.4 | 517.1 | 970.0 |
1 Dividend 2012, SEK 1.8 per share 2 Dividend 2013, SEK 2.0 per share
| Amounts in SEK M | Note | 2013 | 2012 |
|---|---|---|---|
| Cash flow from operations | |||
| EBIT | 246.7 | 252.2 | |
| Non-cash items | |||
| –Depreciation/amortization of tangible and intangible "xed assets | 57.4 | 50.9 | |
| –Other non-cash items1 | -2.7 | 2.4 | |
| Interest received | 10.3 | 9.2 | |
| Interest paid | -19.7 | -29.8 | |
| Tax paid | -45.1 | -49.4 | |
| Cash flow from operations before changes in working capital | 246.9 | 235.5 | |
| Changes in working capital | |||
| Increase/decrease in inventories and work in progress | 21 | -72.5 | -41.0 |
| Increase/decrease in other current receivables | 22 | 1.3 | 2.2 |
| Increase/decrease in other current liabilities | 30 | 16.7 | 23.8 |
| Cash flow from operations | 192.5 | 220.5 | |
| Cash flow from investing activities | |||
| Divestment of subsidiaries | 18 | 10.7 | 0.0 |
| Investment in intangible "xed assets | -12.3 | -14.3 | |
| Investment in tangible "xed assets | -82.3 | -50.6 | |
| Divestment of tangible "xed assets | 0.0 | -0.1 | |
| Investment in other "nancial "xed assets | 1.9 | 2.0 | |
| Investment in subsidiaries | 0.0 | -22.3 | |
| Cash flow from investing activities | -82.1 | -85.3 | |
| Cash flow from nancing activities |
|||
| Change in overdra¦ facility | 31.4 | 186.2 | |
| Dividend to Parent Company's shareholders | -121.5 | -109.3 | |
| Amortization of loans | -19.1 | -199.0 | |
| Cash flow from nancing activities |
-109.2 | -122.2 | |
| Cash flow for the period | 1.1 | 13.1 | |
| Cash and cash equivalents at the beginning of the period | 24 | 23.6 | 10.5 |
| Cash and cash equivalents at the end of the period2 | 24 | 24.7 | 23.6 |
1 Other non-cash items pertain to translation di¢erences
2 Note that cash and cash equivalents in the cash flow is adjusted for blocked bank funds (SEK 8.4 M in 2013 and SEK 10.3 M in 2012)
| Amounts in SEK M Note |
2013 | 2012 |
|---|---|---|
| Operating income | ||
| Net sales | 0.0 | 0.0 |
| Other operating income | 0.3 | 0.3 |
| Total operating income | 0.3 | 0.3 |
| Operating expenses | ||
| Other external expenses 8, 9 |
-3.6 | -4.2 |
| Personnel costs | 9 -0.8 |
-0.4 |
| Total operating expenses | -4.4 | -4.6 |
| EBIT | -4.1 | -4.3 |
| Dividends from Group companies | 100.0 | 0.0 |
| Interest income and similar items | 32.0 | 33.8 |
| Interest expenses and similar items | -27.9 | -27.6 |
| Pro t from nancial items 10 |
104.1 | 6.2 |
| Pro t before tax |
100.0 | 1.9 |
| Tax on pro"t for the year 11 |
0.0 | 0.0 |
| Pro t for the year |
100.0 | 1.9 |
No consolidated statement of other comprehensive income was prepared since the company recognized no transactions under other comprehensive income. The prot for the period corresponds with the comprehensive income for the period .
| Amounts in SEK M | Note | Dec. 31, 2013 | Dec. 31, 2012 |
|---|---|---|---|
| ASSETS | |||
| Fixed assets | |||
| Financial xed assets |
|||
| Participations in Group companies | 15 | 358.0 | 358.0 |
| Receivables from Group companies | 354.0 | 354.0 | |
| Total xed assets |
712.1 | 712.1 | |
| Current assets | |||
| Current receivables | |||
| Receivables from Group companies | 15.6 | 17.1 | |
| Other receivables | 22 | 100.0 | 0.0 |
| Prepaid expenses and accrued income | 1.0 | 1.5 | |
| Total current receivables | 116.6 | 18.7 | |
| Cash and bank balances | 0.0 | 0.0 | |
| Total current assets | 116.6 | 18.7 | |
| TOTAL ASSETS | 828.7 | 730.8 |
| Amounts in SEK M | Note | Dec. 31, 2013 | Dec. 31, 2012 |
|---|---|---|---|
| SHAREHOLDERS' EQUITY AND LIABILITIES | |||
| Shareholders' equity | |||
| Restricted equity | |||
| Share capital | 25 | 20.2 | 20.2 |
| Total restricted equity | 20.2 | 20.2 | |
| Unrestricted equity | |||
| Share premium reserve | 418.7 | 418.7 | |
| Earnings brought forward | -311.0 | -191.4 | |
| Pro"t for the year | 100.0 | 1.9 | |
| Total unrestricted equity | 207.7 | 229.2 | |
| Total shareholders' equity | 227.9 | 249.3 | |
| Long-term liabilities | |||
| Liabilities to credit institutions | 27 | 0.0 | 0.0 |
| Total long-term liabilities | 0.0 | 0.0 | |
| Current liabilities | |||
| Borrowing from credit institutions | 27 | 598.4 | 479.6 |
| Accounts payable | 0.5 | 0.0 | |
| Current income tax liabilities | 0.0 | 0.0 | |
| Other liabilities | 0.0 | 0.0 | |
| Accrued expenses and deferred income | 31 | 1.9 | 1.8 |
| Total current liabilities | 600.8 | 481.4 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 828.7 | 730.8 | |
| Pledged assets | 32 | 358.0 | 358.0 |
| Contingent liabilities | 32 | None | None |
| Res tricted |
||||||
|---|---|---|---|---|---|---|
| equity | Unrestricted equity | |||||
| Share | Earnings | Pro" t/ | Total share | |||
| Amounts in SEK M | Note 25, 26 |
Share capital |
premium reserve |
brought forward |
loss for the year the |
holders' equity |
| Shareholders' equity on January 1, 2012 | 20.2 | 418.7 | -82.1 | 0.0 | 356.8 | |
| Carried forward | ||||||
| Pro" t for the year | 1.9 | 1.9 | ||||
| Other comprehensive income | 0.0 | |||||
| Total comprehensive income | 1.9 | 1.9 | ||||
| Dividend1 | -109.3 | -109.3 | ||||
| Total transactions with shareholders | -109.3 | -109.3 | ||||
| Shareholders' equity on December 31, 2012 | 20.2 | 418.7 | -191.4 | 1.9 | 249.3 | |
| Shareholders' equity on January 1, 2013 | 20.2 | 418.7 | -191.4 | 1.9 | 249.3 | |
| Carried forward | 1.9 | -1.9 | 0.0 | |||
| Pro" t for the year | 100.0 | 100.0 | ||||
| Other comprehensive income | 0.0 | |||||
| Total comprehensive income | 0.0 | 0.0 | ||||
| Dividend2 | -121.5 | -121.5 | ||||
| Total transactions with shareholders | -121.5 | -121.5 | ||||
| Shareholders' equity on December 31, 2013 | 20.2 | 418.7 | -311.0 | 100.0 | 227.9 |
1 Dividend 2012, SEK 1.8 per share 2 Dividend 2013, SEK 2.0 per share
| Amounts in SEK M | Note 2013 |
2012 |
|---|---|---|
| Cash flow from operations | ||
| EBIT | -4.1 | -4.3 |
| Adjustment for non-cash items | ||
| –Group contributions received | 15.6 | 17.1 |
| –Other non-cash items | 100.0 | 0.0 |
| Interest received | 16.4 | 15.5 |
| Interest paid | -27.2 | -29.2 |
| Tax paid | 0.0 | 0.0 |
| Cash flow from operations before changes in working capital | 100.7 | -0.9 |
| Changes in working capital | ||
| Operating receivables | -98.5 | -2.8 |
| Operating liabilities | 0.4 | 1.2 |
| Cash flow from operations | 2.6 | -2.5 |
| Cash flow from investing activities | ||
| Investments in subsidiaries | 0.0 | 0.0 |
| Cash flow from investing activities | 0.0 | 0.0 |
| Cash flow from nancing activities |
||
| Repayment of debt | 0.0 | -170.0 |
| Dividend | -121.5 | -109.3 |
| Changes in current "nancial liabilities | 118.8 | 281.9 |
| Cash flow from nancing activities |
-2.6 | 2.5 |
| Cash flow for the period | 0.0 | 0.0 |
| Cash and cash equivalents at the beginning of the period | 0.0 | 0.0 |
| Cash and cash equivalents at the end of the period | 0.0 | 0.0 |
The Byggmax Group conducts sales of building supplies and is established in 68 locations in Sweden, 25 locations in Norway and 12 locations in Finland. Byggmax's business concept is to sell high-quality building supplies at the lowest possible price.
The Parent Company is a limited-liability company registered in Sweden with its registered oce in Solna, Stockholm. The address of the head oce is Armégatan 40, SE-171 71 Solna, Sweden.
The Parent Company is listed on NASDAQ OMX Stockholm.
On March 7, 2014, the Board of Directors approved these consolidated nancial statements for publication. The annual accounts will be presented to the Annual General Meeting on May 8, 2014.
All amounts are recognized in SEK millions (SEK M) unless otherwise specied. Amounts in brackets represent the corresponding year-earlier period.
The most important accounting policies applied in the preparation of this annual report are detailed below. The same policies are usually applied by both the Parent Company and the Group.
The nancial statements of the Byggmax Group were prepared in accordance with the Annual Accounts Act and International Financial Reporting Standards (IFRS)/International Accounting Standards (IAS), as adopted by the EU, and recommendation RFR 1 Supplementary Accounting Rules for Groups issued by the Swedish Financial Reporting Board.
Recommendation RFR 2 Accounting for Legal Entities, issued by the Swedish Financial Reporting Board, and the Annual Accounts Act were applied in the preparation of the nancial statements of the Parent Company.
The nancial statements of the Group and the Parent Company refer to the scal year ended December 31, 2013. Byggmax applies the acquisition method when measuring assets and liabilities, with the exception of derivative instruments, which are recognized at fair value in prot or loss.
2.1.1 New and amended standards applied by the Group Those standards applied by the Group for the rst time for the scal year starting January 1, 2013 and that have a material impact on the Group's nancial statements are detailed below:
IAS 1, "Presentation of Financial Statements," has introduced amendments concerning other comprehensive income. The most signicant change in the amended IAS 1 is the requirement that the items recognized under "other comprehensive income" are to be presented in two separate groups. The grouping is to be based on whether or not the items can potentially be reclassied to prot or loss (reclassication adjustments).
Amendments of IFRS 7 "Financial instruments: Disclosures," applying to disclosures related to the o¥setting of assets and liabilities. The amendment contains requirements for new disclosures to facilitate comparison between companies that prepare their nancial statements under IFRS and companies that prepare their nancial statements under US GAAP.
IFRS 13, "Fair Value Measurement" aims to make fair value measurements more consistent and less complex in that the standard provides an exact denition and a shared source in IFRS to fair value measurement and related disclosures. The standard provides guidance for the fair value measurement of all types of assets and liabilities, both nancial and non nancial. While the requirement does not expand the scope for when fair value should be applied, it provides guidance concerning the way it should be applied when other IFRS already stipulate or allow fair value measurement.
An amendment was made to IAS 36 "Impairment of Assets" pertaining to recoverable amount disclosures for non nancial assets. The amendment removes the requirement for recoverable amount disclosures for cash-generating units (CGUs) that was introduced in IAS 36 on the advent of IFRS 13. The amendment does not become obligatory for the Group until January 1, 2014, but the Group has elected to apply the amendment from January 1, 2013.
2.1.2 New standards, amendments and interpretations of existing standards that have not been applied by the Group A number of new standards and interpretations came into e¥ect for scal years beginning a¨er January 1, 2013 and were not applied in the preparation of these nancial statements. None of these are expected to materially impact the Group's nancial statements, with the exception of those outlined below:
IFRS 10 "Consolidated nancial statements" is based on already existing principles dening control as the decisive factor in determining whether a company is to be included in the consolidated accounts. The standard provides further guidance that can be of assistance when it is dicult to determine control. The Group intends to apply IFRS 10 for the scal year commencing January 1, 2014 and has not yet evaluated the full e¥ect on the nancial statements.
IFRS 11 "Joint arrangements" focuses on the rights and obligations of parties in a joint arrangement, rather than its legal form. There are two types of joint arrangements: joint operations and joint ventures. A joint operation arises when a joint operator has direct rights to the assets and obligations for the liabilities in a joint arrangement. In such an arrangement, the recognition of assets, liabilities, revenue and expenses is based on the owner's share of these. A joint venture is a joint arrangement whereby the parties that exercise a joint controlling influence over an arrangement have rights to the net assets in the arrangement. Joint ventures are recognized under the equity method, application of the proportional method is no longer permitted.
IFRS 12 "Disclosures of Interests in Other Entities" includes the disclosure requirements for subsidiaries, joint arrangements, associated companies and unconsolidated structured entities. The Group intends to apply IFRS 12 for the scal year commencing January 1, 2014 and has not yet evaluated the full e¥ect on the nancial statements.
IFRS 9 "Financial Instruments" addresses the classication, measurement and recognition of nancial assets and liabilities. IFRS 9 was issued in November 2009 for nancial assets and in October 2010 for nancial liabilities and replaces those sections of IAS 39 related to classication and measurement of nancial instruments. IFRS 9 provides that nancial assets have to be classied in two measurement categories: measurement at fair value or measurement at amortized cost. The classication is determined at initial recognition based on the company's business model and the characteristic conditions in the contractual cash flows. For nancial liabilities, no major changes take place compared with IAS 39. The most signicant change relates to liabilities identied at fair value. For these, the portion of the fair value change arising from own credit risk must be recognized in other comprehensive income instead of prot or loss provided that this does not give rise to accounting mismatch. The Group has not yet been evaluated its impact. The Group will assess the e¥ects of the remaining phases of IFRS 9 when they have been nalized by the IASB.
IFRIC 21 Levies claries the recognition of an obligation to pay a tax or levy that is not income tax. The interpretation claries the nature of the obligating event that triggers the payment of the tax or levy, and when the tax or levy is to be recognized as a liability. The Group is not currently exposed to any signicant taxes or levies that are not income taxes and, accordingly, this interpretation does not have any material impact on the Group.
None of the other IFRS or IFRIC interpretations that have yet to come into legal e¥ect are expected to have any material impact on the Group.
The preparation of nancial statements in compliance with IFRS and generally accepted Swedish accounting principles requires assessments and assumptions to be made that a¥ect recognized asset and liability items and income and expense items, respectively, as well as other information disclosed. The actual outcome may di¥er from these assessments. The areas that require a high degree of complex assessment, or such areas in which assumptions and estimates are of material signicance to the consolidated accounts, are detailed in Note 4.
Subsidiaries are all the companies in which the Group has the right to design nancial and operative strategies in a manner that normally results from a shareholding exceeding 50 percent of the voting rights of the shares or participations or in which the Group through an agreement is the sole party exercising a controlling influence. Subsidiaries are included in the consolidated accounts from the date on which the controlling influence was transferred to the Group. They are eliminated from the consolidated accounts as of the date the controlling influence ceases.
The acquisition method is applied in recognizing the Group's acquisitions of subsidiaries. The cost of an acquisition corresponds to the fair value of the assets received as compensation, issued shareholders' equity instruments and liabilities arising or assumed on the acquisition date. Expenses directly attributable to the acquisition should be recognized in prot or loss. Identiable acquired assets and assumed liabilities, and contingent liabilities in an acquisition of a business are initially measured at fair value on the acquisition date, regardless of any minority interest. The surplus that corresponds to the di¥erence between the cost and the fair value of the Group's share of identiable acquired assets, liabilities and contingent liabilities is recognized as goodwill. If the cost is less than the fair value of the acquired subsidiary's assets, liabilities and contingent liabilities, the di¥erence is recognized directly in prot or loss.
Intra-group transactions and balance-sheet items, as well as unrealized gains on transactions between Group companies are eliminated. Unrealized losses are also eliminated, although any losses are considered an indication that a need for impairment may exist. The accounting policies for subsidiaries were changed as appropriate to guarantee consistent application of the Group's policies.
In connection with the acquisition of a company, an assessment is made as to whether the acquisition should be classied as a business or an asset. Byggmax denes an acquisition as a business combination in the event of the existence of a business activity with employees in addition to the acquired assets and liabilities. Business combinations are recognized in accordance with IFRS 3, which entails, for example, that acquisition costs are expensed directly and that deferred tax is recognized as the di¥erence between the acquired assets' market value and their residual value for tax purposes. For assets acquisitions, all acquisition costs are recognized as an increase of the cost in accordance with IAS 16 and IAS 38. Byggmax determines whether the acquisition is to be classied as a business or an asset on a case-by-case basis. No acquisitions were made in 2013.
Operating segments are recognized in a manner that corresponds to the internal reporting submitted to the chief operating decision maker (CODM). The CODM is the function that is responsible for the allocation of resources and assessment of the operating segments' results. In the Group, this function was identied as the Board of Directors. Byggmax has only one identied operating segment, which is the Nordic segment.
Functional currency and reporting currency Items included in the nancial reports for the various units in the Group are measured in the currency used in the economic environment in which each company is primarily active (functional currency). In the consolidated accounts, Swedish kronor (SEK) is used, which is the Parent Company's functional currency and reporting currency.
Transactions in foreign currency are translated to the functional currency according to the exchange rate prevailing on the transaction date. Exchange-rate gains and losses arising in payment of such transactions and in translation of monetary assets and liabilities in foreign currencies at the closing-date rate are recognized in prot or loss. Exchangerate di¥erences in accounts payable and accounts receivable are recognized in EBIT. Other exchange-rate di¥erences are recognized in net nancial items.
Consolidation of foreign subsidiaries and branches The assets and liabilities of foreign subsidiaries and branches are translated at the closing-date rate, while all items in prot or loss are translated monthly at the month's average rate and all exchange-rate di¥erences that arise in the translation of foreign subsidiaries' nancial statements are recognized in other comprehensive income.
Capitalized expenses for development work and similar items Capitalized expenses for development and similar items, primarily capitalized investments in the Group's business system and website, are recognized at cost less accumulated amortization and any impairment. Amortization is applied on a straight-line basis over the estimated economic lifetime, which is ve years.
Costs for maintenance of proprietary development work are expensed as they arise. Development costs attributable to the development and testing of identiable products and systems are recognized as an intangible xed asset when the criteria for recognizing an intangible asset are satised.
Goodwill corresponds to the amount by which the cost exceeds the fair value of the Group's share of an acquired subsidiary's identiable net assets on the acquisition date. Goodwill from the acquisition of subsidiaries is recognized as an intangible asset.
Goodwill, which is recognized separately, is tested annually to identify possible impairment needs and is recognized at cost less accumulated impairment. Impairment of goodwill is not reversed. Gains or losses from the divestment of a unit include the remaining recognized value of the goodwill attributable to the divested unit.
Goodwill is allocated to the CGU that existed when the goodwill item arose, when assessing possible impairment needs. The distribution is based on the CGUs or groups of CGUs that are expected to benet from the business combination that resulted in the goodwill item. The Byggmax Group
distributes the original goodwill to the segments existing on the date when the original goodwill arose. Additional goodwill is distributed to the units deemed to benet from the business combination.
All tangible xed assets are recognized at cost reduced by depreciation. The cost includes fees that can be directly attributed to acquisition of the asset.
Additional fees are added to the asset's carrying amount or recognized as a separate asset, depending on what is most appropriate, only if it is probable that the future economic benets associated with the asset will accrue to the Group and the asset's cost can be measured in a reliable manner. The carrying amount for the replaced portion is eliminated from the balance sheet. All other forms of repairs and maintenance are recognized as costs in prot or loss during the period in which they arise. No depreciation is applied to land. Depreciation of other assets to reduce their cost to the estimated residual value over the estimated economic lifetime is applied in a straight line according to the following:
| Renovations and land maintenance | 20 years |
|---|---|
| Equipment, tools, "xtures and "ttings | 5 years |
| Computers and IT-related equipment | 5 years |
The residual values of assets and their economic lifetimes are reviewed every balance-sheet date and adjusted as necessary. An asset's carrying amount is immediately written down to its recoverable amount if the asset's carrying amount is greater that its recoverable amount.
Gains and losses from divestments are established by comparing the sale proceeds with the carrying amount and are recognized under other operating income or other operating expenses in prot or loss. Properties that the Group owns are sold when the building is ready for use. Thus depreciation does not arise on Byggmax's properties, which are sold directly a¨er construction. All properties are classied as operating properties.
As of January 1, 2009, the revised standard IAS 23 Borrowing Costs is applied, meaning that the Group as of January 1, 2009 capitalizes borrowing costs that are directly attributable to the purchase, construction or production of an asset that takes a substantial period of time to complete for its intended use or sale as part of the cost of the asset. For periods prior to January 1, 2009, the principle was to immediately expense all borrowing costs. During 2013, the Group did not capitalize borrowing costs, since there were no assets during the period that required a substantial period of time for completion for use or for sale.
Assets that have an indeterminate economic lifetime, such as goodwill, are not depreciated but instead tested annually for the need for impairment. Tangible xed assets that are depreciated and such intangible assets that are amortized are assessed with respect to decline in value whenever
events or changes in circumstances indicate that the asset's carrying amount exceeds its recoverable amount. Impairment is recognized in an amount corresponding to the amount by which the asset's carrying amount exceeds the recoverable amount. The recoverable amount is the higher of the asset's fair value reduced by sales costs and its value in use. In assessing impairment needs, assets are grouped at the lowest level for which separate cash flows can be identied (CGUs). For tangible and intangible xed assets that have been impaired, an assessment is made on each balance-sheet date as to whether a reversal should take place. Impairment of goodwill is not reversed.
The Group classies its nancial assets in the following categories: nancial assets and liabilities measured at fair value in prot or loss, loan receivables and accounts receivable, nancial assets held until maturity, available-for-sale nancial assets and other nancial liabilities. This classi cation depends on the purpose for which the nancial asset was acquired. Management establishes the classication of the nancial assets on the rst reporting date and reassesses this decision on every reporting date. At present, the Group has no nancial assets that are classed as nancial assets held until maturity or available-for-sale nancial assets.
Financial assets and liabilities measured at fair value in prot or loss are nancial instruments held for sale. A nancial asset or a nancial liability is classied in this category if it was primarily acquired to be sold within a short period. Derivatives are classied as held for sale unless they are identied as hedges. The Group holds derivative instruments in the form of currency forward contracts. The Byggmax Group does not apply hedge accounting according to IAS 39, meaning that all derivative instruments are recognized at fair value in prot or loss. Changes in the value of derivative instruments attributable to borrowing are recognized under nancial expenses. Other changes in the value of derivative instruments are recognized as nancial income or expenses.
Loan receivables, accounts receivable and other receivables Loan receivables, accounts receivable and other receivables are nancial assets which are not derivatives, which have payments that are established or can be established and which are not listed on an active market. They are included in current assets with the exception of items with maturity dates greater than 12 months from the balance-sheet date, which classies them as xed assets. Loan receivables, accounts receivable and other receivables are recognized as accounts receivable, other receivables and other long-term receivables in the balance sheet. Cash and cash equivalents are also included in this category. An impairment of accounts receivable and other receivables is recognized in prot or loss under other operating expenses.
The Group's borrowing (which includes borrowing from credit institutions and other long-term borrowing in the balance sheet) and accounts payable are classied as other nancial liabilities.
Purchases and sales of nancial assets and liabilities are recognized on the transaction date, which is the date on which the Group pledged to purchase or sell the asset or liability. Financial assets and liabilities are initially recognized at fair value in the balance sheet. Financial assets are removed from the balance sheet when the right to receive cash flows from the instrument has expired or been transferred and the Group has transferred, essentially, all risks and benets associated with ownership rights. Financial liabilities are removed from the balance sheet when the contractual obligation has been fullled or in some other manner extinguished.
Financial assets and liabilities measured at fair value in pro t or loss and available-for-sale nancial assets are recognized a¨er the acquisition date at fair value. Loan receivables, accounts receivable and other receivables and nancial assets held until maturity and other nancial liabilities are recognized a¨er the acquisition date at amortized cost with application of the e¥ective-interest method.
The fair value of currency forward contracts is established using observable data for currency forwards on the balancesheet date. Fair value for interest swaps is calculated as the current value of estimated cash flows.
On each balance-sheet date, the Group considers whether there is objective evidence of a need for impairment for a nancial asset or a group of nancial assets, such as the closure of an active market or the probability that a debtor will not be able to discharge its obligations. Impairments of equity instruments, which are recognized in prot or loss, are not reversed in prot or loss. Impairment testing of accounts receivable is described below.
Accounts receivable and other receivables are initially recognized at fair value and therea¨er at amortized cost with application of the e¥ective-interest method reduced by any provisions for decline in value. The recognized value for accounts receivable and other receivables, a¨er any impairments, is assumed to correspond to the fair value, since this item is short-term by nature. Provisions for a decline in value in accounts receivable are made when there is objective evidence that the Group will not be able to receive all amounts due according to the original terms of the receivables. Signicant nancial diculties for the debtor, probability that the debtor will be declared bankrupt or undergo nancial reconstruction and missing or late payments (due for more than 90 days) are considered indicators that a need for impairment of an account receivable may apply. Losses relating to accounts receivable, other receivables and recovered and previously impaired accounts receivable and other receivables are recognized under the item other operating expenses in prot or loss.
In the Group's report on nancial position, cash and cash equivalents correspond to cash, bank balances, other short-term investments with maturity dates within three months from the acquisition date and blocked bank holdings that are expected to be settled within 12 months a¨er the balance-sheet date. The overdra¨ facility is recognized as borrowing among current liabilities.
Cash and cash equivalents in the cash-flow statement do not agree with the denition of cash and cash equivalents in the balance sheet. In the cash-flow statement, we have excluded blocked bank holdings, since they are expected to be settled later than three months from the acquisition date.
Common shares are classied as shareholders' equity. Transaction costs that can be directly attributed to new share issues are recognized in net amounts a¨er tax in shareholders' equity as a deduction from the issue proceeds. Premiums for warrants are recognized in the shareholders' equity item retained earnings.
Accounts payable are initially recognized in the balance sheet at fair value and then at amortized cost with application of the e¥ective-interest method. The recognized value of accounts payable is assumed to correspond to their fair value, since this item is short-term by nature.
Borrowing is recognized initially at fair value net a¨er transaction costs. Borrowing is subsequently recognized at amortized cost, and any di¥erence between the amount received (net a¨er transaction costs) and the repayment amount is recognized in prot or loss distributed over the term of the loan with application of the e¥ective-interest method. Borrowing is classied as current liabilities unless the Group has an unconditional right to defer payment of the debt for at least 12 months a¨er the balance-sheet date.
Inventories are recognized at the lower of cost and net sales value. The cost is established using the weighted-average method. The cost of goods for resale corresponds to the purchasing cost for the goods. Borrowing costs are not included. Inventory consists of building supplies sold in Byggmax stores. The net sales value is the estimated sales price in ongoing operations reduced by applicable variable sales costs. Provisions required for obsolescence were made.
The tax cost for the year comprises current and deferred tax. Tax is recognized in prot or loss, except when tax pertains to items that are recognized in other comprehensive income or directly in shareholders' equity. In such cases, tax is recognized in other comprehensive income and shareholders' equity respectively.
The current tax cost is calculated based on the tax regulations on the balance-sheet date that are in e¥ect or in practice approved in the countries in which the Parent Company's subsidiaries are active and generate taxable income. Management actively evaluates the claims that are made in tax returns regarding situations where tax regulations are subject to interpretation and allocates reserves where appropriate for amounts that are likely to be paid to tax authorities.
Deferred tax is recognized in its entirety according to the balance-sheet method on all temporary di¥erences arising between the value for tax purposes of assets and liabilities and their carrying amounts in the consolidated accounts. Deferred tax is not recognized, however, if it arises as a result of the initial recognition of goodwill. Neither is deferred tax recognized if it arises as a result of a transaction for an asset or liability being recognized for the rst time that is not a business combination and which on the acquisition date does not a¥ect recognized or taxable earnings. Deferred income tax is calculated by applying tax rates and laws that have been approved or announced on the balance-sheet date and which are expected to apply when the deferred tax assets are realized or when the deferred tax liabilities are settled.
Deferred tax assets are recognized to the extent that it is probable that future surpluses for tax purposes will be available to o¥set temporary di¥erences.
Deferred tax is calculated on the basis of temporary differences arising in participations in subsidiaries except in cases where reversal of the temporary di¥erences can be controlled by the Group and it is probable that the temporary di¥erence will not be reversed in the foreseeable future.
When there is an intent to settle balances through net payments, deferred tax assets and liabilities are o¥set when a legal right of o¥set exists for current tax assets and tax liabilities and when the deferred tax assets and liabilities can be attributed to taxes debited by one and the same tax authority and apply to the same tax subject or di¥erent tax subjects.
The Group companies only have dened-contribution pension plans with the exception of Alecta, which is a denedbenet plan that for the time being can be treated as a dened-contribution plan.
For dened-contribution pension plans, Byggmax pays fees to a publicly or privately administered pension insurance plan on an obligatory, contractual or voluntary basis. The Group has no further payment obligations when the fees have been paid. The fees are recognized as personnel costs in prot or loss at the rate in which they are earned by employees performing services for the company during a period. Prepaid fees are recognized as an asset to the extent that cash payment or a reduction of future payments will accrue to the Group.
Compensation on termination of employment Compensation on termination of employment is paid when employment is terminated by Byggmax prior to the normal pension age or when the employee accepts a voluntary termination in exchange for such compensation. The Group recognizes severance pay when the Group is demonstrably obligated either to terminate employment according to a detailed formal plan without any option for recall or to provide compensation in a case of termination of employment as a result of an o¥er made to encourage voluntary resignation. Benets that are due more than 12 months a¨er the balance-sheet date are discounted to current value.
The Group recognizes a liability and an expense for bonuses. The Group recognizes a provision when there is a legal obligation or an informal obligation due to previous practice.
Share-based payments within the scope of the existing options program do not entail any cost under IFRS 2, since the price of the warrants corresponds to their fair value.
The Group's income is generated from the sale of goods that are included in the Byggmax product range. Sales are primarily to private customers, although there are some sales to companies. There is no production or development of products within the Group. Sales recognized are net of intra-Group sales.
Income includes the fair value of what has been received or will be received for goods sold in the Group's ongoing operations. Income is recognized in net amounts with deductions for VAT, returns and discounts. The Group recognizes income when its amount can be measured in a reliable manner and it is probable that future economic benets will accrue to the company. This date coincides with delivery of the goods to the customer.
Interest income is recognized at the rate in which it is earned.
The Group builds properties which a¨er completion are sold to a leasing company (see also 2.14 Leasing below with respect to Sale-and-leaseback transactions). Income from the sale of the property is recognized when risks and benets associated with ownership are transferred to the leasing company, which normally coincides with the transfer date.
Leasing in which a signicant portion of the risks and bene ts of ownership are retained by the lessor is classied as operational leasing. Payments made during the leasing period are expensed in prot or loss in a straight line over the leasing period.
Leasing of xed assets in which Byggmax in all signicant respects has the economic risks and benets associated with ownership is classied as nancial leasing. At the beginning of the leasing period, nancial leasing is recognized in the balance sheet at the lower of the leasing object's fair value
and the current value of the minimum leasing fees. Each leasing payment is distributed between amortization of the debt and nancial expenses to achieve a xed interest rate for the recognized liability. The corresponding payment obligations, a¨er deduction of nancial expenses, are included in the balance sheet under borrowing from credit institutions. The interest portion of nancial expenses is recognized in prot or loss and distributed over the leasing period so that an amount is recognized in every reporting period that corresponds to a xed interest rate for the recognized liability during the respective period. Fixed assets held according to nancial leasing contracts are amortized over the shorter of the periods for the asset's economic lifetime and the leasing period.
A sale-and-leaseback transaction comprises the sale of an asset and subsequent leasing of the same asset under a leasing contract. When Byggmax builds a property, it is sold a¨er completion to an external party, whereby the property is leased back to Byggmax for its operations. In assessing the terms of the sales transaction and the leasing contract, the Group's considers if the sale price is on market terms and if the leasing fee that the Group pays is based on market levels.
All sale-and-leaseback transactions are considered to be operational leasing contracts, and the sale is considered to be based on market terms, meaning that the leasing fee was not subject to adjustments. The leasing fee is expensed in a straight line over the period of the leasing contract and in accordance with the contract.
Gains relating to sale-and-leaseback transactions are recognized in the item nancial income in prot or loss and losses relating to sale-and-leaseback transactions are recognized in the item nancial expenses in prot or loss.
Dividends to the Parent Company's shareholders are recognized as a liability in the consolidated nancial statements in the period in which the dividend is approved by the Parent Company's shareholders.
The Parent Company has prepared its Annual Report in accordance with the Swedish Annual Accounts Act and the Swedish Financial Reporting Board's recommendation, RFR 2 Accounting for Legal Entities. This entails that in the annual report for the legal entity, the Parent Company is to apply all IFRS and interpretations approved by the EU as far as possible within the framework of the Swedish Annual Accounts Act and take into account the connection between accounting and taxation. The recommendation species the exceptions and supplements that are to be applied from IFRS. The Parent Company applies di¥erent accounting policies than the Group as specied below.
The Parent Company applies the presentation forms specied in the Swedish Annual Accounts Act, which means in part that another presentation of shareholders' equity is applied and that provisions are recognized under a separate heading in the balance sheet.
Shares in subsidiaries are recognized at cost a¨er deduction of any impairment. Received dividends are recognized as income, whereupon an assessment is made of any need for impairment of shares in subsidiaries. When there is an indication that shares and participations in subsidiaries have declined in value, a calculation of the recoverable amount is performed. If that value is lower than the carrying amount, impairment is recognized. Impairments are recognized under income from participations in Group companies.
The Parent Company applies RFR 2 for Group contributions. This entails that Group contributions that the Parent Company receives from subsidiaries are recognized as nancial income and that Group contributions that are paid to the Parent Company from subsidiaries are recognized as an increase in the participation in a subsidiary. The tax on Group contributions received/paid is recognized in accordance with IAS 12 in prot or loss.
Through its operations, the Group is exposed to various nancial risks, such as market risk (including currency and interest risk), credit risk and liquidity risk.
The Group's overriding nancial policy is intended to identify and minimize the e¥ects of nancial risks. Practical risk management is handled by Byggmax's central nance department according to the nancial policy established each year by the Board of Directors. The nancial hedging relations established by the Group as part of its risk management do not qualify for hedge accounting according to the rules in IAS 39.
The Board of Directors continuously receives reports in respect of cash flows, debt levels and fulllment of the terms of nancial agreements, together with comparisons with budgets and forecasts.
The Parent Company Byggmax Group AB is deemed to have limited risk exposure, meaning that the descriptions below primarily relate to the Group as a whole. The described risks can thus a¥ect the Parent Company indirectly in that the asset item participations in Group companies may be positively or negatively a¥ected by how the risks described below are managed.
Although Byggmax's consolidated accounts are stated in SEK, the Group has operations in Sweden, Norway and Finland and purchases some goods in other currencies than SEK. This means that the Group is exposed to currency risk in that unfavorable changes in exchange rates can have a negative e¥ect on EBIT, shareholders' equity and cash flow.
Payment flows in the form of accounts receivable and accounts payable in foreign currency result in currency exposure for the Group. Byggmax has currency exposure in NOK, some exposure resulting from the purchase of goods in USD and in EUR (for which there is a natural hedge in sales in EUR in the Finnish market).
| Change in (percen tage points) all other |
E'ect on EBIT (SEK M) 2013 |
E'ect on EBIT (SEK M) |
|
|---|---|---|---|
| factors unchanged | 2012 | ||
| NOK | +/- 10% | +/- 1,2 | +/- 1,7 |
| EUR | +/- 10% | +/ - 0,3 | +/ - 0,3 |
Exposure in another currency other than the functional currency at December 31, 2013 in the transaction currency
| DKK | EUR | NOK | SEK | USD | |
|---|---|---|---|---|---|
| Accounts receivable | 0,0 | 0,1 | 0,0 | 0,0 | 0,0 |
| Accounts payable | 4,6 | 2,4 | 0,1 | 13,1 | 0,1 |
| DKK | EUR | NOK | SEK | USD | |
|---|---|---|---|---|---|
| Accounts receivable | 0,1 | 0,0 | 0,0 | 0,6 | 0,0 |
| Accounts payable | 2,9 | 1,6 | 0,0 | 19,4 | 0,0 |
Byggmax hedges currency positions greater than SEK 100 M on an annual basis each quarter by hedging 50 percent for the coming six months and 25 percent for the coming quarter, meaning that 75 percent is hedged.
Transaction exposure in consolidation of units outside Sweden The Group's EBIT is also a¥ected by currency e¥ects arising due to exchange-rate trends in the local currencies of the various foreign subsidiaries and branches against SEK. Translation e¥ects also arise for the Group's net assets in the consolidation of the balance sheets of foreign companies and branches. This risk is not hedged.
The Group's interest risk arises primarily through long-term borrowing. The Group's borrowing carries variable interest, thus resulting in exposure. Borrowing that is subject to variable interest exposes the Group to interest risk with respect to cash flow. To reduce the interest risk, the Group has as its policy that interest shall be xed for 50 percent of the remaining bank loans for at least two years. If interest on the Group's borrowing in SEK had been 1.0 percentage point higher/lower during 2013 with all other variables constant and consideration taken to interest swaps, the consolidated prot a¨er tax for the scal year would have been SEK 3.0 M higher/lower, primarily as an e¥ect of higher interest costs for borrowing with variable interest. Byggmax continuously monitors the interest risk by examining the e¥ect of loans with variable interest on EBIT for the year. Because Byggmax signed a new nancing agreement with Svenska Handelsbanken in 2012, there was no long-term borrowing at December 31, 2013 and thus no hedging of interest rates was carried out.
| Change in (per | E'ect | E'ect | |
|---|---|---|---|
| centage points) | on EBIT | on EBIT | |
| all other factors | (SEK M) | (SEK M) | |
| unchanged | 2013 | 2012 | |
| Interest Rate | + 1% | -3,0 | -2,5 |
Byggmax has very low credit risk in relation to the Group's customers in that the majority of sales are in cash and since the Group does not invoice external customers. Credit exposure primarily comprises accrued but as yet unpaid bonuses from suppliers.
Byggmax's policy in respect of liquidity risk is to ensure the Group has sucient cash and cash equivalents to nance operating activities. The Board of Directors manages the liquidity risk exposure through ensuring that Byggmax has sucient credit facilities in place to satisfy the future needs of the business. The need is established through continuous follow-up of forecast and actual cash flows with consideration taken to the tenors of nancial assets and liabilities in the balance sheet. Byggmax's primary credit facility is provided by Svenska Handelsbanken by way of a credit agreement. The agreement with Svenska Handelsbanken extents until summer 2015.
The size of the credit facility available is reviewed regularly and drawn up to cover forecast peaks in the gross debt level with a healthy margin. On December 31, 2013, the Group had cash and cash equivalents totaling SEK 33.1 M (33.9) and an unutilized credit facility of SEK 78.8 M (110.1). Information regarding blocked bank funds is available in Note 24. The table below shows the non-discounted cash flows that arise from the Group's liabilities in the form of nancial instruments based on the contracted remaining periods on the balancesheet date. Amounts in foreign currencies and amounts to be paid are based on variable interest and were estimated by using the exchange and interest rates prevailing on the balance-sheet date.
| Group (SEK M) | Less than 1 year |
Between 1 and 2 years |
Between 2 and 5 years |
More than 5 years |
|---|---|---|---|---|
| On December 31, 2013 | ||||
| Borrowing | 492.4 | 0.9 | ||
| Liabilities relating to "nancial leasing | 13.0 | 5.4 | 0.4 | |
| Net regulated derivative instruments (interest swaps) | ||||
| Gross regulated derivative instruments (currency for wards) |
0.8 | |||
| Accounts payable | 284.8 | |||
| Total | 791.0 | 6.3 | 0.4 | 0.0 |
| On December 31, 2012 | ||||
| Borrowing | 461.2 | 1.1 | 0.9 | |
| Liabilities relating to "nancial leasing | 23.5 | 13.3 | 3.9 | |
| Net regulated derivative instruments (interest swaps) | ||||
| Gross regulated derivative instruments (currency for wards) |
0.5 | |||
| Accounts payable | 278.7 | |||
| Total | 764.0 | 14.4 | 4.7 | 0.0 |
| Less than 1 | Between 1 | Between 2 | More than 5 | |
| Parent Company (SEK M) | year | and 2 years | and 5 years | years |
| On December 31, 2013 | ||||
| Borrowing | 492.4 | 0.9 | ||
| Total | 492.4 | 0.9 | 0.0 | 0.0 |
| On December 31, 2012 | ||||
| Borrowing | 461.2 | 1.1 | 0.9 | |
| Total | 461.2 | 1.1 | 0.9 | 0.0 |
The Byggmax Group works to reduce its capital/nancing risk by:
· Establishing adequate credit facilities well in advance of foreseeable needs.
· Monitoring due dates for the total debt in order to match amortization to anticipated cash flow.
· Satisfying key ratios according to nancing contracts. The key ratios are the interest-coverage ratio, debt/equity ratio and the equity ratio/risk bearing capital.
· Optimizing working capital within the Group. Working capital refers to: the total of inventory, accounts receivable, receivables on bonuses from suppliers, other receivables and prepaid expenses/accrued income less the total of accounts payable, tax liabilities, other current liabilities and accrued expenses/deferred income. While Byggmax has no specified goal for the equity ratio, there is a dividend target. Byggmax policy is for dividends to amount to at least 50 percent of Byggmax's net profits for the preceding fiscal year, subject to Byggmax's need for capital, EBIT, financial position, capital requirements and economic conditions.
The Group makes estimates and assumptions regarding the future to be able to prepare the accounts in accordance with generally accepted accounting practices. Estimates and assumptions are evaluated regularly and are based on historical experience and other factors, including expectations regarding future events that are considered reasonable under the prevailing circumstances. The actual outcome may di¥er from the estimates and assumptions made. The estimates and assumptions made in the nal accounts on December 31, 2013, are not considered able to signicantly a¥ect the EBIT and nancial position for the coming scal year.
All sale-and-leaseback transactions are considered to be operational leasing contracts, which is based on an appraisal of each leasing contract in relation to the following criteria: nancial implication, leasing period and whether the contract contains an option on the property.
The Group determines each year if there is any need to recognize an impairment of goodwill, in accordance with the accounting policy described in Note 2.8. Impairment of non-nancial xed assets. The assumptions and assessments made in respect of expected cash flows and the discount rate are described in Note 13.
| Information by geographic area | 2013 | 2012 |
|---|---|---|
| Net sales Sweden | 2,363.0 | 2,263.1 |
| Net sales Norway | 704.3 | 700.6 |
| Net sales other countries | 149.1 | 126.7 |
| Total sales | 3,216.4 | 3,090.4 |
| ASSETS | 2013 | 2012 |
|---|---|---|
| Assets in Sweden | 1,744.5 | 1,651.9 |
| Assets in Norway | 169.6 | 172.4 |
| Assets in other countries | 30.7 | 29.2 |
| Total assets | 1,994.8 | 1,853.5 |
Byggmax has only identied one operating segment, the Nordic segment, as described in Note 2.3. The Parent Company has no net sales.
| Group | 2013 | 2012 |
|---|---|---|
| Exchange-rate di¥erences | 2.6 | 5.4 |
| Gain from divestment of equipment | 0.3 | 0.0 |
| Other | 3.8 | 1.8 |
| Total other operating income | 6.6 | 7.2 |
| Group | 2013 | 2012 |
|---|---|---|
| Exchange-rate di¥erences | -7.8 | -7.7 |
| Loss from divestment of equipment | -0.2 | -0.3 |
| Total other operating expenses | -8.0 | -8.0 |
Auditing assignments include examination of the Annual Report and nancial statements, as well as the administration of the Board of Directors and the President, other work assignments that are the responsibility of the company's auditors, and guidance and assistance occasioned by observations in conjunction with such reviews or the completion of such other work assignments. Everything else is other assignments.
| Group | 2013 | 2012 |
|---|---|---|
| Öhrlings PricewaterhouseCoopers AB | ||
| Auditing assignments | 1.0 | 1.0 |
| Other assignments | 0.0 | 0.0 |
| Tax consultancy | 0.4 | 0.3 |
| Other services | 0.2 | 0.0 |
| Total auditors' fees | 1.6 | 1.3 |
| Parent Company | 2013 | 2012 |
| Öhrlings PricewaterhouseCoopers AB | ||
| Auditing assignments | 0.4 | 0.4 |
| Other assignments | 0.0 | 0.0 |
| Tax consultancy | 0.0 | 0.1 |
| Other services | 0.0 | 0.0 |
| Group | 2013 | 2012 |
|---|---|---|
| Salaries and other compensation | 236.8 | 210.0 |
| Social costs | 52.7 | 47.9 |
| Pension costs | 12.9 | 9.8 |
| Other personnel costs | 6.4 | 5.0 |
| Total employee benets | 309.1 | 272.6 |
The guidelines for determining compensation to senior executives that were adopted by the 2013 AGM correspond, in all material respects, with the guidelines proposed to the 2014 AGM. Information about these guidelines is available in the Administration Report on page 32. Remuneration to senior executives was paid in accordance with previous resolutions and the guidelines that were adopted at the AGM. Bonuses to the Board of Directors, President and other senior executives amounted to SEK 0 M (0).
| 2013 | 2012 | ||||||
|---|---|---|---|---|---|---|---|
| Salaries and other compensation plus social costs (SEK M) |
Salaries and other com pensation |
Social costs (of which pension costs) |
Num ber |
Salaries and other com pensation |
Social costs (of which pension costs) |
Num ber |
|
| Group | |||||||
| Board members, President and other senior executives |
11.3 | 5.6 (2.0) | 12 | 8.4 | 4.0 (1.4) | 11 | |
| Other employees | 222.1 | 59.6 (10.2) | 617 | 202.9 | 53.7 (8.4) | 563 | |
| Total | 233.4 | 65.2 (12.2) | 629 | 211.3 | 57.7 (9.8) | 574 | |
| Parent Company | |||||||
| Board members, President and other senior executives |
1.3 | 0.4 (0.0) | 7 | 1.3 | 0.4 (0.0) | 7 | |
| Other employees | 0.0 | 0.0 (0.0) | 0 | 0.0 | 0.0 (0.0) | 0 | |
| Total | 1.3 | 0.4 (0.0) | 7 | 1.3 | 0.4 (0.0) | 7 |
| 2013 | 2012 | |||
|---|---|---|---|---|
| Average number of employees |
Of whom men |
Average number of employees |
Of whom men |
|
| Subsidiaries | ||||
| Sweden | 453 | 79% | 422 | 82% |
| Norway | 115 | 92% | 108 | 89% |
| Finland | 61 | 74% | 44 | 75% |
| Total in subsidiaries | 629 | 81% | 574 | 83% |
| Group total | 629 | 81% | 574 | 83% |
| 2013 | 2012 | |||
|---|---|---|---|---|
| Number on the balance sheet date |
Of whom men |
Number on the balance sheet date |
Of whom men |
|
| Group (including subsidiaries) | ||||
| Board members | 8 | 75% | 8 | 75% |
| President and other senior executives | 6 | 84% | 5 | 80% |
| Group total | 14 | 86% | 13 | 85% |
| Parent Company | ||||
| Board members | 6 | 83% | 6 | 83% |
| President and other senior executives | 1 | 100% | 1 | 100% |
| Parent Company total | 7 | 86% | 7 | 86% |
| Base salary/ |
Variable compen |
Other | Pension | Other compen |
||
|---|---|---|---|---|---|---|
| Compensation to senior executives (SEK M) | Board fee | sation | bene"ts | costs | sation | Total |
| 2013 | ||||||
| Chairman of the Board – Fredrik Cappelen | 0.5 | 0.5 | ||||
| Board member – Anders Moberg | 0.3 | 0.3 | ||||
| Board member – Johannes Lien | 0.0 | 0.0 | ||||
| Board member – Lottie Svedenstedt | 0.3 | 0.3 | ||||
| Board member – Stig Notlöv | 0.3 | 0.3 | ||||
| Board member – Stefan Linder | 0.0 | 0.0 | ||||
| President | 3.2 | 0.8 | 0.8 | 4.8 | ||
| Other senior executives ("ve individuals, of whom one woman) |
5.4 | 0.3 | 1.1 | 6.8 | ||
| Total | 10.0 | 1.1 | 0.0 | 1.9 | 0.0 | 13.0 |
| Base salary/ |
Variable compen |
Other | Pension | Other compen |
||
|---|---|---|---|---|---|---|
| Compensation to senior executives (SEK M) | Board fee | sation | bene"ts | costs | sation | Total |
| 2012 | ||||||
| Chairman of the Board – Fredrik Cappelen | 0.5 | 0.5 | ||||
| Board member – Anders Moberg | 0.3 | 0.3 | ||||
| Board member – Johannes Lien | 0.0 | 0.0 | ||||
| Board member – Lottie Svedenstedt | 0.3 | 0.3 | ||||
| Board member – Stig Notlöv | 0.3 | 0.3 | ||||
| Board member – Stefan Linder | 0.0 | 0.0 | ||||
| President | 2.2 | 0.8 | 0.4 | 3.4 | ||
| Other senior executives (four individuals, of | ||||||
| whom one woman) | 3.9 | 0.3 | 1.0 | 5.2 | ||
| Summa | 7.3 | 1.1 | 0.0 | 1.4 | 0.0 | 9.8 |
There are no agreements concerning severance pay for the President or Group management. The period of notice for the President in the event of termination by the company or by the President is three months. The retirement age for the President and other senior executives is 65. Fixed salary and pension was renegotiated for the President in 2013 in line with the relevant market and reflects the scope and responsibility entailed in the assignment. The President has a dened-contribution pension.
The 2011 AGM resolved to introduce an option program for about 20 senior executives and other key sta¥ at Byggmax. The term for the warrants was set at 3.5 years and they can be exercised in the nal six months. A total of 565,000 warrants were subscribed for, corresponding to nearly 1 percent in dilution. The warrants are priced at market value (SEK 6.77 per warrant) and the valuation was made by an independent party. Each warrant will entitle its holder to subscribe for one share in the company at an exercise price of SEK 63.9. The participants in the warrants program have entered into a pre-emption agreement.
The 2013 AGM resolved to introduce an option program for about 27 senior executives and other key sta¥ at Byggmax. The term for the warrants was set at 4.5 years and they can be exercised in the nal six months. In total, 600,000 warrants were subscribed for. The warrants are priced at market value (SEK 2.24 per warrant) and the valuation was made by an independent party. Each warrant will entitle its holder to subscribe for one share in the company at an exercise price of SEK 42.80. The participants in the warrants program have entered into a pre-emption agreement.
| Group | 2013 | 2012 |
|---|---|---|
| Pro"t from participations in Group companies | 0.4 | 0.0 |
| Total | 0.4 | 0.0 |
| Financial income | ||
| Exchange-rate gains | 10.1 | 8.5 |
| Changes in fair value – interest swaps and currency derivatives | 3.6 | 6.6 |
| Interest income | 0.2 | 0.7 |
| Other "nancial income | 0.1 | 0.0 |
| Total | 13.9 | 15.9 |
| Financial expenses | ||
| Exchange-rate losses | -3.8 | -11.2 |
| Changes in fair value – interest swaps and currency derivatives | -3.3 | -6.8 |
| –interest expenses, bank loans | -14.5 | -16.2 |
| –"nancial leasing, reversal of discounting e¥ect | -1.1 | -2.0 |
| Other "nancial expenses | -0.4 | -0.4 |
| Total | -23.1 | -36.6 |
| Loss from nancial items | -8.7 | -20.7 |
| Parent Company | 2013 | 2012 |
| Earnings from shares in Group companies | ||
| Dividends from Group companies | 100.0 | 0.0 |
| Total | 100.0 | 0.0 |
| Interest income and similar items | ||
| Exchange-rate gains | 0.1 | 0.1 |
| Group contributions | 15.6 | 17.1 |
| Interest income | 16.4 | 16.6 |
| Total | 32.0 | 33.8 |
| Interest expenses and similar items | ||
| Exchange-rate losses | -0.1 | -0.3 |
| Interest expenses | -27.8 | -27.3 |
| Total | -27.9 | -27.6 |
| Prot from nancial items | 104 .1 | 6.2 |
| Group | 2013 | 2012 |
|---|---|---|
| Current tax for the year | -41.5 | -50.8 |
| Current tax attributable to previous years | 0.2 | -0.5 |
| Remeasured deferred tax due to changed tax rate in Sweden | 0.0 | 12.0 |
| Deferred tax expense relating to temporary di¥erences | -12.6 | -13.0 |
| Deferred tax income relating to temporary di¥erences | 0.0 | 0.6 |
| Total | -53.9 | -51.7 |
| Parent Company | 2013 | 2012 |
| Current tax for the year | 0.0 | 0.0 |
The di¥erence between recognized tax expense and the estimated tax expense based on prevailing tax rates was as follows:
Total 0.0 0.0
| Group | 2013 | 2012 |
|---|---|---|
| Pro"t before tax | 237.9 | 231.5 |
| Income tax calculated according to the Group's prevailing tax rate | -52.3 | -60.9 |
| Non-taxable income | 0.6 | 0.0 |
| Non-deductible costs | -1.4 | -0.7 |
| Tax e¥ect of interest on the tax allocation reserve | 0.0 | 0.0 |
| Remeasured deferred tax due to changed tax rate in Sweden | 0.0 | 12.0 |
| De"cits for tax purposes for which no deferred tax asset is recognized | 0.0 | 0.2 |
| Blocked amounts on foreign taxes for tax purposes | -2.0 | 0.0 |
| E¥ect of foreign tax rates | 0.4 | -2.0 |
| Adjustment of current tax relating to previous years | 0.2 | -0.5 |
| Other | 0.7 | 0.0 |
| Tax expense | -53.9 | -51.7 |
| Parent Company | 2013 | 2012 |
|---|---|---|
| Pro"t before tax | 0.0 | 1.9 |
| Income tax calculated according to prevailing tax rate 22.0 (26.3) percent | 0.0 | 0.0 |
| Tax expense | 0.0 | 0.0 |
| Weighted average tax rate within the Group: | 22.67% | 22.33% |
The prevailing tax rate for income tax within the Group and the Parent Company is 22.0 (26.3) percent.
Exchange-rate dierences were recognized in prot or loss according to the following:
| Group | 2013 | 2012 |
|---|---|---|
| Other operating income | 2.6 | 5.4 |
| Other operating expenses | -7.8 | -7.7 |
| Financial income | 10.3 | 7.7 |
| Financial expenses | -4.1 | -10.9 |
| Total exchange-rate di'erences | 1.1 | -5.5 |
| Group | 2013 | 2012 |
|---|---|---|
| Opening cost | 55.5 | 41.3 |
| New acquisitions | 12.3 | 14.3 |
| Exchange-rate di¥erences | -0.2 | -0.1 |
| Closing accumulated cost | 67.7 | 55.5 |
| Opening depreciation | -27.6 | -19.7 |
| Amortization for the year | -9.8 | -7.9 |
| Exchange-rate di¥erences | 0.1 | 0.0 |
| Closing accumulated depreciation | -37.3 | -27.6 |
| Closing carrying amount | 30.4 | 27.9 |
Capitalized development costs relate to development of business systems and the website.
| Goodwill | 2013 | 2012 |
|---|---|---|
| Opening cost | 1,051.0 | 1,051.0 |
| Closing accumulated cost | 1,051.0 | 1,051.0 |
| Closing carrying amount | 1,051.0 | 1,051.0 |
The carrying amount for goodwill is tested on an annual basis. In addition, Byggmax assesses at the end of each reporting period if there is any indication that an asset may have declined in value. If there is an indication of a decline in value, the asset is tested for impairment. During the fourth quarter of each year, the Group examines whether or not there is any impairment requirement for goodwill.
Recognized goodwill of SEK 1,051.0 M is entirely attributable to the Swedish part of the business, which is considered the cash-generating unit (CGU).
The recoverable amount for the CGU is determined on the basis of calculations of value in use. The calculation is based on estimated future cash flows based on the 2013 business plan and forecasts for the year from 2014 to 2018 that were prepared by Group management and approved by the Board. The management's forecasts are based on historical experience as well as external data on market growth, etc. The forecasts are based on a number of principal assumptions concerning future growth and EBIT margins. The calculated recoverable amount is compared with the carrying amount. Cash flows beyond the ve-year period, meaning a¨er 2018, are extrapolated using an estimated growth rate of 2 percent, which corresponds to a weighted average growth rate under Riksbanken's (the Swedish Central Bank) inflation targets and is in line with sustainable growth for the industry. In the corresponding calculations for 2012, an estimated growth rate of 2 percent was used.
When discounting expected future cash flows, a weighted average cost of capital (WACC) before tax was used, which is currently 7 percent (7). The WACC was based on the following assumptions:
Testing indicates that the recoverable amount exceeds the carrying amount.
Sensitivity analyses show that a rise in the discount rate of 4 percentage points or a decline in cash flow of 10 percent would not a¥ect the results of the test.
| Group | 2013 | 2012 |
|---|---|---|
| Opening cost | 338.9 | 290.5 |
| Purchases | 72.8 | 51.6 |
| Sales and scrapping | -2.0 | -3.7 |
| Increase through business combinations | 0.0 | 0.3 |
| Reclassi"cations | 0.0 | 0.0 |
| Exchange-rate di¥erences | -4.1 | 0.2 |
| Closing accumulated cost | 405.6 | 338.9 |
| Opening depreciation | -205.6 | -161.0 |
| Sales and scrapping | 0.6 | 0.3 |
| Increase through business combinations | 0.0 | 0.0 |
| Depreciation for the year | -48.0 | -44.8 |
| Reclassi"cations | 0.0 | 0.0 |
| Exchange-rate di¥erences | 1.7 | -0.1 |
| Closing accumulated depreciation | -251.3 | -205.6 |
| Closing carrying amount | 154.3 | 133.3 |
The item equipment, tools, xtures and ttings includes leasing objects that the Group holds according to nancial leasing contracts in the following amounts:
| Group | 2013 | 2012 |
|---|---|---|
| Cost – capitalized "nancial leasing | 157.0 | 163.2 |
| Accumulated depreciation | -128.9 | -114.8 |
| Carrying amount | 28.1 | 48.5 |
As of 2012, the Group does not lease inventory to the same extent as earlier, but rather these are nanced internally.
| Buildings and land | ||
|---|---|---|
| Group | 2013 | 2012 |
| Opening cost | 36.8 | 7.9 |
| Increase through asset acquisitions | 4.1 | 28.9 |
| Sales and scrapping | -9.5 | 0.0 |
| Exchange-rate di¥erences | 0.0 | 0.0 |
| Closing accumulated cost | 31.5 | 36.8 |
| Opening depreciation | -1.9 | -1.2 |
| Sales and scrapping | 0.3 | 0.0 |
| Depreciation for the year | -1.1 | -0.7 |
| Exchange-rate di¥erences | 0.0 | 0.0 |
| Closing accumulated depreciation | -2.7 | -1.9 |
| Closing carrying amount | 28.7 | 34.9 |
| Group | 2013 | 2012 |
|---|---|---|
| Opening cost | 8.7 | 6.0 |
| Increase through asset acquisitions | 5.3 | 2.7 |
| Sales and scrapping | 0.0 | 0.0 |
| Exchange-rate di¥erences | -0.2 | 0.0 |
| Closing accumulated cost | 13.8 | 8.7 |
| Opening depreciation | -2.2 | -1.7 |
| Sales and scrapping | 0.0 | 0.0 |
| Depreciation for the year | -0.8 | -0.5 |
| Exchange-rate di¥erences | 0.1 | 0.0 |
| Closing accumulated depreciation | -2.9 | -2.2 |
| Closing carrying amount | 10.9 | 6.6 |
| Parent Company | 2013 | 2012 |
|---|---|---|
| Opening cost | 358.0 | 358.0 |
| Investments | 0.0 | 0.0 |
| Capital contributions | 0.0 | 0.0 |
| Closing carrying amount | 358.0 | 358.0 |
| The Parent Company has participations in the following Group companies: | Carrying amount | |||||
|---|---|---|---|---|---|---|
| Name | Corporate regis tration number |
Registered o'ce |
Share of capital |
Num ber of shares |
2013 | 2012 |
| Companies owned by Byggmax Group AB (publ) |
||||||
| Byggmax AB | 556645-6215 | Halmstad | 100% | 100,000 | 345.0 | 345.0 |
| Svea Distribution AB | 556602-5895 | Eslöv | 100% | 200 | 13.0 | 13.0 |
| Byggmax Fastighetsutveckling AB | 556726-8593 | Stockholm | 100% | 1,000 | 0.1 | 0.1 |
| 358.0 | 358.0 | |||||
| Holdings in other Group companies | ||||||
| Byggmax International Purchasing AB | 556757-2473 | Stockholm | 100% | |||
| Byggmax Fastighets Holding AB | 556726-8601 | Stockholm | 100% | |||
| Byggmax Fastighetsutveckling 6 AB | 556751-4442 | Stockholm | 100% |
| Byggmax Fastighetsutveckling 7 AB | 556757-3133 | Stockholm | 100% |
|---|---|---|---|
| Byggmax Fastighetsutveckling 8 AB | 556889-6780 | Stockholm | 100% |
| Byggmax Fastighetsutveckling 9 AB | 556916-5250 | Stockholm | 100% |
| Lännersta 14:1 Fastighets AB | 556791-3818 | Stockholm | 100% |
| Byggmax Fastighet 2 AS | 991 127 895 | Oslo | 100% |
| Byggmax Fastighet 3 AS | 991 127 917 | Oslo | 100% |
| Byggmax Finland Fastighetsholding 1 Oy | 2186417-4 | Helsinki | 100% |
| Byggmax Finland Fastighet 1 Oy | 2186407-8 | Helsinki | 100% |
| Byggmax Finland Fastighetsholding 2 Oy | 2186507-0 | Helsinki | 100% |
No subsidiaries were acquired in 2013.
The Group's nancial assets and liabilities are measured at amortized cost with the exception of derivative instruments, which are measured at fair value in prot or loss. Derivative instruments are recognized separately on a separate line in the balance sheet. For a more detailed description of the Group's derivative instruments, refer to Note 19.
As of January 1, 2009, the Group applies an amendment of IFRS 7 for nancial instruments measured at fair value in the balance sheet. Disclosures are therefore required on valuation at fair value per level in the following fair-value hierarchy:
Byggmax only holds derivative instruments measured at fair value in its nancial statements. These instruments are measured at fair value in prot or loss. The value of the derivative instruments is based on observable data for the asset or liability, i.e. level 2. No reclassications between the various levels took place during the scal year.
| Loan receivables and | Assets measured at fair | ||
|---|---|---|---|
| Assets in the balance sheet at Dec. 31, 2013 | accounts receivable | value in prot or loss | Total |
| Derivative instruments | 0.8 | 0.8 | |
| Accounts receivable and other receivables exclu | |||
| ding prepaid expenses and accrued income | 41.9 | 41.9 | |
| Cash and cash equivalents | 33.1 | 33.1 | |
| Total | 75.0 | 0.8 | 75.8 |
| Liabilities in the balance sheet at Dec. 31, 2013 | Other nancial liabilities | Total | |
| Borrowings (excluding liabilities related to nancial | |||
| leasing) | 491.3 | 491.3 | |
| Liabilities relating to nancial leasing | 13.0 | 13.0 | |
| Accounts payable and other liabilities excluding accrued | |||
| expenses and deferred income | 309.7 | 309.7 | |
| Total | 814.0 | 814.0 | |
| Loan receivables and | Assets measured at fair | ||
| Assets in the balance sheet at Dec. 31, 2012 | accounts receivable | value in prot or loss | Total |
| Derivative instruments | 0.5 | 0.5 | |
| Accounts receivable and other receivables exclu | |||
| ding prepaid expenses and accrued income | 59.5 | 59.5 | |
| Cash and cash equivalents | 33.9 | 33.9 | |
| Total | 93.3 | 0.5 | 93.8 |
| Liabilities in the balance sheet at Dec. 31, 2012 | Other nancial liabilities | Total | |
| Borrowings (excluding liabilities related to nancial leasing) | 459.9 | 459.9 | |
| Liabilities relating to nancial leasing | 40.7 | 40.7 | |
| Accounts payable and other liabilities excluding accrued | |||
| expenses and deferred income | 299.4 | 299.4 | |
| Total | 800.0 | 800.0 |
In 2013, the subsidiary Romell Förvaltning AB was sold, which contained the property in Karlskoga. The divestment generated a positive earnings eect, which was not signicant for the Group.
| Group Dec. 31, 2013 | Assets | Liabilities |
|---|---|---|
| Derivative instruments | ||
| Interest swaps – held for sale | 0.0 | 0.0 |
| Currency forwards - held for sale | 1.3 | 0.5 |
| Total derivative instruments | 1.3 | 0.5 |
| Group Dec. 31, 2012 | Assets | Liabilities |
| Derivative instruments | ||
| Interest swaps – held for sale | 0.0 | 0.0 |
| Currency forwards - held for sale | 0.7 | 0.2 |
| Total derivative instruments | 0.7 | 0.2 |
Derivative instruments held for sale are classied as current assets or current liabilities. The nominal amount for outstanding currency forward contracts was SEK 133.9 M (76.1) on the balance-sheet date. The nominal amount for interest swaps outstanding was SEK 0.0 M (0.0) on the balance-sheet date.
The maximum exposure to credit risks on the balance-sheet date was the fair value of the derivative instruments recognized as assets in the balance sheet.
| Group | 2013 | 2012 |
|---|---|---|
| Accounts receivable | 2.0 | 8.2 |
| Provisions for doubtful receivables | -0.1 | -0.3 |
| Total accounts receivable | 1.9 | 7.9 |
The fair value of the Group's accounts receivable corresponds with the carrying amount.
| Group | 2013 | 2012 |
|---|---|---|
| Completed goods and goods for resale | 538.3 | 465.8 |
| Prepayments to suppliers | 0.0 | 0.1 |
| Total inventories | 538.3 | 465.9 |
Inventories consist in their entirety of goods for resale. No impairment was carried out.
| 2013 | 2012 | |
|---|---|---|
| Bonus receivables from suppliers | 31.9 | 47.4 |
| Other receivables | 8.0 | 4.1 |
| Total other receivables | 40.0 | 51.5 |
| Parent Company | ||
| Dividends from Group companies | 100.0 | 0.0 |
| Total other receivables | 100.0 | 0.0 |
Most bonus receivables are in SEK. As of the balance-sheet date, December 31, 2013, no other receivables were considered doubtful. In respect of existing bonus receivables, the majority of the items have a corresponding entry in accounts payable. The fair value of the Group's other receivables corresponds to the carrying amount. Dividends from Group companies pertains to receivables for anticipated dividends.
| Group | 2013 | 2012 |
|---|---|---|
| Prepaid rent | 22.8 | 21.4 |
| Prepaid leasing fees | 0.5 | 0.5 |
| Accrued interest income | 0.0 | 0.0 |
| Other items | 4.8 | 5.3 |
| Total prepaid expenses and accrued income | 28.2 | 27.2 |
Cash and cash equivalents in the balance sheet and the cash-flow statement include the following:
| Group | 2013 | 2012 |
|---|---|---|
| Balance sheet | ||
| Cash and bank balances | 24.7 | 23.6 |
| Blocked funds | 8.4 | 10.3 |
| Total cash and cash equivalents | 33.1 | 33.9 |
| Cash-flow statement | ||
| Cash and bank balances | 24.7 | 23.6 |
| Short-term investments | 0.0 | 0.0 |
| Total cash and cash equivalents | 24.7 | 23.6 |
Blocked funds refer to rent deposits of SEK 1.9 M (2.8), a customs credit of SEK 6.5 M (7.0) and a deposit bank account of SEK 0.0 M (0.5).
The specication of changes in shareholders' equity is presented in the report Changes in shareholders' equity directly a¢er the balance sheet.
| No. of | Share | Other capital con |
||
|---|---|---|---|---|
| Group (millions) | shares | capital | tributions | Total |
| On December 31, 2012 | 60.7 | 20.2 | 441.0 | 461.3 |
| On December 31, 2013 | 60.7 | 20.2 | 441.0 | 461.3 |
The shares have a quotient value of SEK 0.33 per share (SEK 0.33 per share). Each share represents one vote. All registered shares were paid in full on the balance sheet date.
The category Reserves within shareholders' equity consists in its entirety of translation dierences arising in the translation of foreign subsidiaries.
| Group | 2013 | 2012 |
|---|---|---|
| Long-term | ||
| Liabilities to credit institutions | 0.0 | 0.0 |
| Liabilities relating to nancial leasing | 5.8 | 17.2 |
| Total | 5.8 | 17.2 |
| Short-term | 2013 | 2012 |
| Liabilities to credit institutions | 100.0 | 100.0 |
| Overdra¢ facilities | 391.3 | 359.9 |
| Liabilities relating to nancial leasing | 13.0 | 23.5 |
| Total | 504.3 | 483.5 |
| Total borrowing | 510.1 | 500.6 |
| Parent Company | 2013 | 2012 |
| Liabilities to credit institutions | 498.4 | 379.6 |
| Overdra¢ facility | 100.0 | 100.0 |
| Total | 598.4 | 479.6 |
| Total borrowing | 598.4 | 479.6 |
| All borrowing within the Group is in SEK. All external loans have an interest period of three months, meaning that the car | ||
| rying amount closely corresponds to fair value. There are pledged assets for these loans. See Note 32. |
The Group has the following unutilized credit facilities:
| Group | 2013 | 2012 |
|---|---|---|
| Overdra¢ facility | 78.7 | 40.1 |
| Total | 78.7 | 40.1 |
Of the above available overdra¢ facilities, SEK 0.0 M is a customs credit.
Gross liabilities for nancial leasing
| Group | 2013 | 2012 |
|---|---|---|
| Within one year | 13.3 | 18.3 |
| Later than one year but within ve years | 6.2 | 24.2 |
| Later than ve years | 0.0 | |
| Total | 42.5 | |
| Future nancial expenses for nancial leasing | -0.7 | -1.8 |
| Present value of liabilities related to nancial leasing | 18.8 | 40.7 |
In the balance-sheet item borrowing from credit institutions, nancial leasing is included as follows:
| Group | 2012 | |
|---|---|---|
| Within one year | 13.0 | 23.5 |
| Later than one year but within ve years | 17.2 | |
| Later than ve years | 0.0 | |
| Total | 18.8 | 40.7 |
| Group | 2013 | 2012 |
|---|---|---|
| Deferred tax liabilities | ||
| Untaxed reserves | 76.1 | 63.3 |
| Leasing | 2.2 | 1.9 |
| Total deferred tax liabilities | 78.4 | 65.2 |
| Deferred tax assets | ||
| Derivatives | -0.2 | -0.1 |
| Valuation of loss carry-forwards | 1.8 | 1.8 |
| Other | 0.0 | 0.0 |
| Total deferred tax assets | 1.6 | 1.7 |
| Deferred tax liabilities, net | 76.7 | 63.5 |
| Gross changes relating to deferred taxes are as follows: | ||
| Group | 2013 | 2012 |
| On the opening date | 63.5 | 60.4 |
| Reversal of discount ešect | 0.0 | 0.0 |
| Recognition in prot or loss | 12.9 | 13.3 |
| Recognition in prot or loss due to changed tax rate in Sweden | 0.0 | -10.2 |
| Acquired deferred tax liability | 0.0 | |
| Adjustment from current receivable to deferred tax asset | 0.0 | |
| Exchange-rate dišerences | 0.4 | 0.0 |
Deferred tax assets are recognized as loss carry-forwards for tax purposes insofar as it is probable that they can be oset by future taxable prots. The Group recognized deferred tax assets of SEK 1.6 M (1.7). Of these, SEK 0.0 M (0.0) is in respect of losses amounting to SEK 0.0 M (0.1) that can be oset against future taxable prots. SEK 0.6 M (0.6) pertains to taxes on internal gains of SEK 2.7 M (2.7), a negative SEK 0.2 M (neg: 0.1) to derivatives and SEK 1.4 M (1.4) to blocked amounts for foreign tax.
On the balance-sheet date 76.7 63.5
Obligations for retirement and family pensions for salaried employees in Sweden are secured via insurance with Alecta. According to statement UFR 6 from the Swedish Financial Reporting Board, this is a dened-benet plan that includes several employers. For the 2013 scal year, the Group did not have access to information that would enable it to be recognized as a dened-benet plan. The pension plan according to ITP that is secured through insurance in Alecta is therefore recognized as a dened-contribution plan. The year's fees for pension insurance issued by Alecta amounted to SEK 3.9 M (3.8). Alecta's surplus can be distributed to policy holders and/or insured persons. On December 31, 2013, Alecta's surplus in the form of the collective consolidation level amounted to 149 percent (129). The collective consolidation level corresponds to the market value of Alecta's assets as a percentage of pension obligations as calculated according to Alecta's actuarial assumptions, which are not in agreement with IAS 19.
| Group | 2013 | 2012 |
|---|---|---|
| VAT liabilities | 13.0 | 10.2 |
| Personnel-related liabilities | 5.3 | 4.6 |
| Other | 6.7 | 6.0 |
| Total other liabilities | 24.9 | 20.7 |
| Group | 2013 | 2012 |
|---|---|---|
| Accrued salaries | 22.2 | 18.4 |
| Accrued vacation pay | 30.2 | 27.7 |
| Accrued social fees | 8.4 | 8.8 |
| Other | 16.0 | 15.3 |
| Total accrued expenses and deferred income | 76.7 | 70.3 |
| Parent Company | ||
|---|---|---|
| Other | 1,9 | 1,8 |
| Total accrued expenses and deferred income | 1,8 |
| Group | 2012 | |
|---|---|---|
| For own debts and provisions: | ||
| Shares in subsidiaries | 1,100.2 | 1,022.9 |
| Blocked bank funds | 8.4 | 10.3 |
| Chattel mortgages | 120.0 | 120.0 |
| Total pledged assets, contingent liabilities and contingent assets | 1,153.2 |
| Parent Company | ||
|---|---|---|
| Shares in subsidiaries | 358.0 | 358.0 |
| Total pledged assets and contingent liabilities | 358.0 | |
| Contingent liabilities | ||
| Group | 2013 | 2012 |
| Capital adequacy guarantee on behalf of Group companies | None | None |
The Group leases rental premises, as well as miscellaneous small equipment, according to terminable operational leasing contracts.
Future leasing fees for non-terminable operational leasing contracts fall due for payment as follows:
| Group | 2013 | 2012 |
|---|---|---|
| Within one year | 155.3 | 131.0 |
| Later than one year but within ve years | 426.3 | |
| Later than ve years | 348.0 | 323.8 |
| Total | 995.6 | 881.1 |
Most of the above amounts relate to the rent for premises. In other respects, most of the Group's leasing contracts are classied as nancial leasing. Information on nancial leasing is presented in Note 27. Expensed leasing costs amounted to SEK 146.7 M (113.6).
A related party is dened as a party that exercises a controlling influence (owns more than 50 percent) or that has a substantial influence (owns more than 20 percent). The Byggmax Group is 19.6 percent owned by the Altor 2003 Fund, which thus has substantial influence over the Group. The principal shareholder in the company is Altor 2003 Sarl. At the end of the year, Altor 2003 Sarl divested part of its holding and, at December 31, 2013, owned 19.6 percent of the shares and capital. It has two representatives on the Board of Directors and, for this reason, is assessed as having substantial influence. Altor has controlling influence over Senzum AB (a subsidiary of Lindor Group AB, which is owned by the Altor 2003 fund and Altor
Fund II), Carnegie Investment Bank (owned by Altor Fund III) and Dustin Financial Services AB (owned by Altor Fund II).
During the year, Byggmax purchased call-center services from Senzum AB, which is a subsidiary of Lindor Group AB. Total costs during 2013 amounted to SEK 3.4 M (3.6). During the year, Byggmax purchased IT equipment from Dustin Financial Services AB. Total costs during 2013 amounted to SEK 0.6 M (0.6).
| Liabilities to related parties: | 2013 | 2012 |
|---|---|---|
| Senzum AB | 0.2 | 0.2 |
| Dustin AB | 0.0 | 0.0 |
| Total | 0.2 | 0.2 |
| Receivables from related parties: | 2013 | 2012 |
| - | 0.0 | 0.0 |
| Total | 0.0 | 0.0 |
Receivables from related parties are primarily the result of sales transactions and fall due for payment one month a¢er the sale date. The Group has no collateral for these receivables. No interest is charged. Liabilities to related parties are primarily the result of purchase transactions and fall due for payment one month a¢er the purchase date. These liabilities carry no interest.
Information regarding key individuals in senior management is provided in Note 9, Employee benets.
No signicant events have occurred since the end of the scal year.
The Board of Directors and President hereby a§rm that the consolidated accounts have been prepared in accordance with the International Financial Reporting Standards (IFRS), as adopted by the EU, and provide an accurate portrayal of the Group's nancial position and performance. The Annual Report has been prepared in accordance with the generally accepted accounting practice in Sweden and accurately reflects the Parent Company's nancial position and performance. The Administration Report for the Group and the Parent Company provides an accurate overview of trends in the Group's and Parent Company's operations, nancial position and performance, as well as describing signicant risks and instability factors faced by the Parent Company and companies in the Group.
The Parent Company's income statement and balance sheet and the Group's consolidated income statement and balance sheet will be presented to the Annual General Meeting on May 8, 2014 for adoption.
Stockholm, March 7, 2014
Chairman of the Board
ANDERS MOBERG JOHANNES LIEN
Board member Board member
LOTTIE SVEDENSTEDT STEFAN LINDER
Board member Board member
Board member President
STIG NOTLÖV MAGNUS AGERVALD
Our auditors' report was submitted on March 11, 2014 Öhrlings PricewaterhouseCoopers AB
ANN-CHRISTINE HÄGGLUND
Authorized Public Accountant
Report on the annual accounts and consolidated accounts We have audited the annual accounts and consolidated accounts of Byggmax Group AB (publ) for the year 2013 with the exception of the corporate governance report on pages 36-39. The annual accounts and consolidated accounts of the company are included in the printed version of this document on pages 32-74.
The Board of Directors and the President are responsible for the preparation and fair presentation of these annual accounts in accordance with the Annual Accounts Act and of the consolidated accounts in accordance with International Financial Reporting Standards, as adopted by the EU, and the Annual Accounts Act, and for such internal control as the Board of Directors and the President determine is necessary to enable the preparation of annual accounts and consolidated accounts that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these annual accounts and consolidated accounts based on our audit. We conducted our audit in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the annual accounts and consolidated accounts are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual accounts and consolidated accounts. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the annual accounts and consolidated accounts, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company's preparation and fair presentation of the annual accounts and consolidated accounts in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the eectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors and the President, as well as evaluating the overall presentation of the annual accounts and consolidated accounts. We believe that the audit evidence we have obtained is sucient and appropriate to provide a basis for our audit opinion.
In our opinion, the annual accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the nancial position of the parent company as of December 31, 2013 and of its nancial performance and its cash flows for the year then ended in accordance with the Annual Accounts Act. The consolidated accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the nancial position of the group as of December 31, 2013 and of its nancial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards, as adopted by the EU, and the Annual Accounts Act. Our opinions do not cover the corporate governance report on pages 36-39. The statutory administration report is consistent with the other parts of the annual accounts and consolidated accounts.
We therefore recommend that the annual meeting of shareholders adopt the income statement and balance sheet for the parent company and the group
In addition to our audit of the annual accounts and consolidated accounts, we have also audited the proposed appropriations of the company's prot or loss and the administration of the Board of Directors and the President of Byggmax Group AB (publ) for the year 2013. We have also conducted a statutory examination of the corporate governance report.
Responsibilities of the Board of Directors and the President The Board of Directors is responsible for the proposal for appropriations of the company's prot or loss, and the Board of Directors and the President are responsible for administration under the Companies Act and that the corporate governance report on pages 36-39 has been prepared in accordance with the Annual Accounts Act.
Our responsibility is to express an opinion with reasonable assurance on the proposed appropriations of the company's prot or loss and on the administration based on our audit. We conducted the audit in accordance with generally accepted auditing standards in Sweden. As a basis for our opinion on the Board of Directors' proposed appropriations of the company's prot or loss, we examined the Board of Directors' reasoned statement and a selection of supporting evidence in order to be able to assess whether the proposal is in accordance with the Companies Act.
As a basis for our opinion concerning discharge from liability, in addition to our audit of the annual accounts and consolidated accounts, we examined signicant decisions, actions taken and circumstances of the company in order to determine whether any member of the Board of Directors or the President is liable to the company. We also examined whether any member of the Board of Directors or the President has, in any other way, acted in contravention of the Companies Act, the Annual Accounts Act or the Articles of Association.
We believe that the audit evidence we have obtained is sucient and appropriate to provide a basis for our audit opinions. Furthermore, we have read the corporate governance report and, based on that reading and our knowledge of the company and the Group, we believe that we have a sucient basis for our opinions. This means that our statutory examination of the corporate governance report is dierent and substantially less in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden.
We recommend to the annual meeting of shareholders that the prot be appropriated in accordance with the proposal in the statutory administration report and that the members of the Board of Directors and the President be discharged from liability for the scal year. In our opinion, the corporate governance report has been prepared and its statutory content is consistent with the other parts of the annual accounts and the consolidated accounts.
Stockholm, March 11, 2014 Öhrlings PricewaterhouseCoopers AB
Ann-Christine Hägglund Authorized Public Accountant Auditor in Charge
President since 2008 (employed since 2006). Born 1975. Education: M.Sc. Stockholm School of Economics and M.Sc. Engineering KTH Royal Institute of Technology. Background: Formerly worked as a consultant at McKinsey & Company and analyst at IDI AB and was the founder of Icomera. Other assignments: No other assignments. Shareholding: 100,000 shares and 550,000 warrants.
Business Manager since 2008 (employed since 1999). Born 1966. Education: Social educationist Jönköping University. Background: Formerly department head of Obs Byggmarknad. Other assignments: No other assignments. Shareholding: 80,000 shares and 50,000 warrants.
Marketing and IT Manager since 2012. Born 1974. Education: M.Sc. Engineering KTH Royal Institute of Technology. Background: Formerly worked as a consultant at McKinsey & Company, held several sales and marketing positions at Toms and Cloetta Fazer, President of Friggs AB and President of Karamellkungen AB. Other assignments: No other assignments. Shareholding: 2,451 shares via endowment insurance and 4,900 shares via pension insurance and 60,000 warrants.
Sourcing and Supply Chain Manager since 2013 (employed in 2008). Education: M.Sc. in Engineering Linköpings Tekniska Högskola. Background: Previously Business Area Manager at Rusta. Other assignments: No other assignments. Shareholding: 31,640 shares, 34,000 warrants and exposure through endowment insurance to a further 28,850 shares.
Purchasing Manager since 2007 (employed since 2000). Born 1961. Education: Technology studies and studies in the eld of sales. Background: Formerly Sales Representative and District Manager of Pååls Bagerier. Other assignments: No other assignments. Shareholding: 59,000 shares and 110,000 warrants.
CFO since 2005 (employed in 2005). Born 1973. Education: Master of Science in Business and Economics, Växjö University. Background: Formerly CFO of consumer electronics chain Power, Business Controller of IKEA Russia and Controller at IKEA AB. Other assignments: No other assignments. Shareholding: 240,000 shares and 94,000 warrants.
Byggmax's auditor is Öhrlings PricewaterhouseCoopers AB, with Ann Christine Hägglund as auditor in charge since 2013. Ann Christine Hägglund is an authorized public accountant and a member of FAR SRS. The address of Öhrlings PricewaterhouseCoopers AB's o ces is Torsgatan 21, SE-113 97 Stockholm, Sweden.
Fredrik Cappelen Anders Moberg Johannes Lien
Lottie Svedenstedt Stefan Linder Stig Notlöv
Chairman of the Board since 2008. Board member since 2006. Born 1957 Education: M.Sc. in Business and Economics and studies in political science at Uppsala University. Background: Formerly President and CEO, as well as Board member, of Nobia AB and Board member of Danske Trælast. Other assignments: Chairman of the Board of Dustin AB, Sanitec Oy, Tereystalo OY, Domestic AB and vice Chairman of the Board of Munksjö Oy. Board member of Securitas AB. Shareholding: Owns no shares, but is exposed to 206,759 shares through his endowment insurance and to 200,000 Byggmax shares through an associated company
Board member since 2006. Born 1950. Background: Formerly Board member of Velux A/S and ICA AB and CEO of the IKEA Group, Royal Ahold N.V. and Majid Al Futtaim Group LLC. Other assignments: Anders is Chairman of the Board of Clas Ohlson AB and OBH Nordica AB, as well as a Board member of Husqvarna AB, ZetaDisplay AB, Hema B.V., ITAB AB, Rezidor AB, Amor GMBH, Ahlstrom OY, Bergendahl & Son AB and Suomen Lahikauppa OY. Shareholding: Does not own any shares but is exposed to 600,000 shares in Byggmax through his endowment insurance.
Board member since 2009, Deputy Board member since 2007. Born 1977. Education: M.Sc. from the Norwegian School of Economics Background: Previously a consultant at McKinsey & Company, formerly Board member of Helly Hansen Group AS, N Holding AB and SPT Group AS. Other assignments: Johannes is also a director at Altor Equity Partners AB, Board member of Elixia Holding IV AS, Navico Holding AS and Ketlav Invest AS. He is also a partner and Board member of Cretum Invest AB. Shareholding: Does not own any shares but is exposed to 20,000 shares in Byggmax through his endowment insurance.
Board member since 2010. Born 1957 Education: Lawyer from Uppsala University. Background: Former Regional Manager for H&M, President Inter Ikea Systems A/S, Business Area Manager Ikea of Sweden and CEO Kid Interiør A/S. Other assignments: Chairman of the Management Institute in Lund (MiL). Swedavia AB, Decidokompetensor AB, Thule Group AB, Vanna AB, Stampen AB, Liberala Tidningar i Mellansverige AB, Mediebolaget Promedia i Mellansverige AB and ITAB Shop Concept AB. Shareholding: 10,000 shares.
Board member since 2006. Born 1968. Education: M.Sc. Stockholm School of Economics. Background: Partner i Altor Equity Partners sedan 2004. Previously, Board member of Industri Kapital and worked in the ¥ eld of investment banking at Morgan Stanley in London. Other assignments: Stefan is partner and Board member of Altor Equity Partners AB, Board member of ApoPharm AB, CTEK Holding AB and Dustin Group AB. Shareholding: 0 shares.
Board member of the current company since 2006, Board member of former Parent Company since 1993. Born 1947. Background: Formerly President of Byggmax. Other assignments: No other assignments. Shareholding: 1,575,740 shares through companies.
| Disclosure | Explanation | Page in AR |
|---|---|---|
| 1. Strategy and analysis | ||
| 1.1 | Statement from the chief operating decision maker of the organi zation about the relevance of sustainability to the organization and its strategy |
20 |
| 1.2 | Description of key impacts, risks, and opportunities | 20 |
| 2. Organizational Pro•le | ||
| 2.1 | Name of the organization | 1 |
| 2.2 | Primary brands, products and/or services | 10 |
| 2.3 | Operational structure of the organization, including main divi sions, operating companies, subsidiaries, and joint ventures |
10-14, 67 |
| 2.4 | Location of organization's headquarters | 32 |
| 2.5 | Number of countries where the organization operates, and names of countries with either major operations or that are speci•cally relevant to the sustainability issues covered in the report |
32 |
| 2.6 | Nature of ownership and legal form | 28-29 |
| 2.7 | Markets served | 32 |
| 2.8 | Scale of the reporting organization | 32-35 |
| 2.9 | Signi•cant changes during the reporting period regarding size, structure, or ownership |
32-35 |
| 2.10 | Awards and prizes received in the reporting period | None |
| 3. Report parameters | ||
| Reporting pro•le | ||
| 3.1 | Reporting period | 32 |
| 3.2 | Date of most recent previous report | 74 |
| 3.3 | Reporting cycle | 32 |
| 3.4 | Contact point for questions regarding the report or its contents. | 92 |
| Scope and boundary of report | ||
| 3.5 | Process for de•ning report content | 88 |
| 3.6 | Boundary of the report | 88 |
| 3.7 | State any speci•c limitations on the scope or boundary of the report |
88 |
| 3.8 | Basis for reporting on joint ventures, subsidiaries, leased facili ties, outsourced operations, and other entities that can signi•- cantly a"ect comparability from period to period and/or between organizations |
88 |
| 3.9 | Description of data measurement techniques and the bases of calculations |
20-21 |
| 3.10 | Explanation of the e"ect of any re-statements of information pro vided in earlier reports, and the reasons for such re-statements |
20-21 |
| Disclosure | Explanation | Page in AR |
|---|---|---|
| 3.11 | Signi•cant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report |
51 et seq. |
| GRI content index | ||
| 3.12 | Table identifying the location of the Standard Disclosures in the report |
78 |
| Assurance | ||
| 3.13 | Policy and current practice with regard to seeking external as surance for the report |
22 |
| 4. Governance, Commitments and Engagement | ||
| Governance | ||
| 4.1 | Governance structure of the organization | 36 |
| 4.2 | Indicate whether the Chair of the highest governance body is also an executive o"cer. |
76-77 |
| 4.3 | Number of independent and/or non-executive Board members | 38 |
| 4.4 | Mechanisms for shareholders and employees to provide recom mendations or direction to the Board and Group management |
92 |
| 4.5 | Linkage between compensation for members of the highest governance body, senior executives, and executives and the organization's performance |
34, Note 34 |
| 4.6 | Procedures and processes in place for the Board to ensure con flicts of interest are avoided |
36 et seq. |
| 4.7 | Procedures and processes for determining the quali•cations and expertise that ought to be possessed by the members of the Board to govern the organization's strategy in •nancial, environ mental and social matters |
36 et seq. |
| 4.8 | Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation in the organization |
8-9,15,17 |
| 4.9 | Board procedures and processes for overseeing the organization's identi•cation and management of economic, en vironmental, and social performance and determining adherence compliance with which internationally agreed standards, codes of conduct and principles |
36 et seq. |
| 4.10 | Processes for evaluating the Board's own performance, par ticularly with respect to economic, environmental, and social performance |
36 et seq. |
| Commitments to External Initiatives | ||
| 4.11 | Explanation of whether and how the prudence concept is comp lied with by the organization |
51 et seq. |
| 4.12 | Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses |
20 |
| 4.13 | Memberships in associations (such as industry associations) and/or national/international advocacy organizations |
21 |
| Disclosure Stakeholder engagement |
Explanation | Page in AR |
|---|---|---|
| 4.14 | List of stakeholder groups engaged by the organization | 21 |
| 4.15 | Basis for identi•cation and selection of stakeholders with whom to engage |
21 |
| 4.16 | Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group |
21 |
| 4.17 | Key topics and concerns that have been raised through stake holder engagement, and how the organization has responded to those key topics and concerns, including through its reporting |
21 |
| 5. PERFORMANCE INDICATORS ECONOMIC IMPACT Economic performance |
||
| EC1 | Direct economic value generated and distributed, including revenues, operating expenses, employee compensation, dona tions and other community investments, retained earnings, and payments to capital providers and the public sector |
41 et seq. |
| EC2 | Financial implications and other risks and opportunities for the organization's activities due to climate change |
27 |
| EC3 | Coverage of the organization's de•ned-bene•t plan obligations | 55-56 |
|---|---|---|
| EC4 | Signi•cant •nancial assistance received from government | 15 |
| Market presence | ||
| EC5 | Range of ratios of standard entry level wage by gender compared to local minimum wage at signi•cant locations of operation |
89* |
| EC6 | Policy, practices, and proportion of spending on locally-based suppliers at signi•cant locations of operation |
12 |
| EC7 | Procedures for local hiring and proportion of senior executives hi red from the local community at locations of signi•cant operation |
15 |
| Indirect economic impact | ||
| EC8 | Development and impact of infrastructure investments and ser vices provided primarily for public bene•t through commercial, in-kind, or pro bono engagement |
88 |
| Indicator | Explanation | Page in AR |
|---|---|---|
| EC9 | Understanding and describing signi•cant indirect economic impacts, including the extent of impacts |
89* |
| ENVIRONMENTAL PERFORMANCE INDICATORS | ||
| Material | ||
| EN1 | Materials used by weight or volume | 88 |
| EN2 | Percentage of materials used that are recycled input materials | 88 |
| Energy | ||
| EN3 | Direct energy consumption by primary energy source | 26 |
| EN4 | Indirect energy consumption by primary energy source | 26 |
| EN5 | Energy saved due to conservation and e"ciency improvements | 89* |
| EN6 | Initiatives to provide energy-e"cient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives |
89* |
| EN7 | Initiatives to reduce indirect energy consumption and reductions achieved |
26 |
| Water | ||
| EN8 | Total water withdrawal by source | 88 |
| EN9 | Water sources signi•cantly a"ected by withdrawal of water | 88 |
| EN10 | Percentage and total volume of water recycled and reused | 88 |
| Biodiversity | ||
| EN11 | Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas |
27 |
| EN12 | Description of signi•cant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas |
27 |
| EN13 | Habitats protected or restored | 89* |
| Indicator | Explanation | Page in AR | |
|---|---|---|---|
| EN14 | Strategies, current actions, and future plans for managing im pacts on biodiversity |
89* | |
| EN15 | Number of IUCN Red List species and national conservation list species with habitats in areas a"ected by operations, by level of extinction risk |
89* | |
| Emissions, e"luents, and waste | |||
| EN16 | Total direct and indirect greenhouse gas emissions by weight | 23 | |
| EN17 | Other relevant indirect greenhouse gas emissions by weight | 88 | |
| EN18 | Initiatives to reduce greenhouse gas emissions and reductions achieved |
23-24 | |
| EN19 | Emissions of ozone-depleting substances by weight | 88 | |
| EN20 | NOX, SO2 and other signi•cant air emissions by type and weight |
24 | |
| EN21 | Total water discharge by quality and destination | 88 | |
| EN22 | Total weight of waste by type and disposal method | 88 | |
| EN23 | Total number and volume of signi•cant spills | 88 | |
| EN24 | Weight of transported, imported, exported, or treated waste de emed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally |
89* | |
| EN25 | Identity, size, protected status, and biodiversity value of water bodies and related habitats signi•cantly a"ected by the re porting organization's discharges of water and runo" |
89* | |
| Products and Services | |||
| EN26 | Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation |
23 et seq. | |
| EN27 | Percentage of products sold and their packaging materials that are reclaimed by category |
23 et seq. |
| Indicator Compliance |
Explanation | Page in AR |
|---|---|---|
| EN28 | Monetary value of signi•cant •nes and total number of non monetary sanctions for non-compliance with environmental laws and regulations |
88 |
| Transport | ||
| EN29 | Signi•cant environmental impacts of transporting products and other goods and materials used for the organization's opera tions, and transporting members of the workforce |
89* |
| Overall | ||
| EN30 | Total environmental protection expenditures and investments by type |
89* |
| EMPLOYMENT CONDITIONS AND TERMS OF EMPLOYMENT | ||
| LA1 | Total workforce by employment type, employment contract, and region |
15-16 |
| LA2 | Total number and rate of new employee hires and employee tur nover by age group, gender, and region |
16 |
| LA3 | Bene•ts provided to full-time employees that are not provided to temporary or part-time employees, by signi•cant locations of operation |
88 |
| Labor/management relations | ||
| LA4 | Percentage of employees covered by collective bargaining agre ements |
88 |
| LA5 | Minimum notice period(s) regarding operational changes, inclu ding whether it is speci•ed in collective agreements |
88 |
| Occupational health and safety | ||
| LA6 | Percentage of total workforce represented in formal joint mana gement- worker health and safety committees that help monitor and advise on occupational health and safety programs |
89* |
| LA7 | Rates of injury, occupational diseases, lost days, and absen teeism, and number of work-related fatalities by region and by gender |
16 |
| Indicator | Explanation | Page in AR |
|---|---|---|
| LA8 | Training, counseling, prevention and risk-control programs in place to assist workforce members, their families, or community members regarding serious disease |
88 |
| LA9 | Health and safety topics covered in formal agreements with trade unions |
89* |
| Training and education | ||
| LA10 | Average hours of training per year per employee by gender, and by employee category |
16 |
| LA11 | Programs for skills management and lifelong learning that sup port the continued employability of employees and assist them in managing career endings |
89* |
| LA12 | Percentage of employees receiving regular performance and career development reviews |
89* |
| Diversity and equal opportunity | ||
| LA13 | Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity |
16, 76-77 |
| LA14 | Ratio of basic salary of men to women by employee category | 16 |
| HUMAN RIGHTS | ||
| Investment and procurement practices | ||
| HR1 | Percentage and total number of signi•cant investment agre ements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening |
88 |
| HR2 | Percentage of signi•cant suppliers that have undergone human rights screening, and actions taken |
89 |
| HR3 | Total hours of employee training on policies and procedures con cerning aspects of human rights that are relevant to operations, including the percentage of employees trained |
89* |
| Non-discrimination | ||
| HR4 | Total number of incidents of discrimination and corrective actions taken |
16 |
| Indicator | Explanation | Page in AR | |
|---|---|---|---|
| Freedom of association and collective bargaining | |||
| HR5 | Operations identi•ed in which the right to exercise freedom of association and collective bargaining may be at signi•cant risk, and actions taken to support these rights |
89 | |
| Child labor | |||
| HR6 | Operations identi•ed as having signi•cant risk for incidents of child labor, and measures taken to contribute to the e"ective abolition of child labor |
89 | |
| Forced or compulsory labor | |||
| HR7 | Operations identi•ed as having signi•cant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of forced or compulsory labor |
89 | |
| Security practices | |||
| HR8 | Percentage of security personnel trained in the organization's policies or procedures concerning aspects of human rights that are relevant to operations |
89* | |
| Indigenous rights | |||
| HR9 | Total number of incidents of violations involving rights of indige nous people and actions taken |
89* | |
| ORGANIZATION´S ROLE IN SOCIETY | |||
| Society | |||
| SO1 | Nature, scope and e"ectiveness of any programs and practices that assess and manage the impacts of operations on communi ties including entering, operating, and exiting |
20 et seq. | |
| Corruption | |||
| SO2 | Percentage and total number of business units analyzed for risks related to corruption |
89 | |
| SO3 | Percentage of employees trained in the organization's anti-cor ruption policies and procedures |
89 | |
| SO4 | Actions taken in response to incidents of corruption | 89 |
| Indicator Politics |
Explanation | Page in AR |
|---|---|---|
| SO5 | Public policy positions and participation in public policy develop ment and lobbying |
89 |
| SO6 | Total value of •nancial and in-kind contributions to political par ties, politicians, and related institutions by country |
89 |
| Anti-competitive behavior | ||
| SO7 | Total number of legal actions for anti-competitive behavior, anti trust, and monopoly practices and their outcomes |
89 |
| Compliance | ||
| SO8 | Monetary value of signi•cant •nes and total number of non-mo netary sanctions for non-compliance with laws and regulations |
89 |
| PRODUCT RESPONSIBILITY | ||
| PR1 | Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and the percentage of signi•cant products and services categories subject to such procedures |
12-13 |
| PR2 | Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services, by type of outcomes |
89* |
| Product and service labeling | ||
| PR3 | Type of product and service information required by procedures, and percentage of signi•cant products and services subject to such information requirements |
89 |
| PR4 | Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes |
89* |
| PR5 | Practices related to customer satisfaction, including results of surveys measuring customer satisfaction |
89* |
| Indicator | Explanation | Page in AR |
|---|---|---|
| Market communications | ||
| PR6 | Programs for adherence to laws, standards, and voluntary codes related to marketing communication, including advertising, PR and sponsorship |
89 |
| PR7 | Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communication, including advertising, promotion, and sponsorship by type of outcomes |
89 |
| Customer Privacy | ||
| PR8 | Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data |
89 |
| Compliance | ||
| PR9 | Monetary value of signi•cant •nes for non-compliance with laws and regulations concerning the provision and use of products and services |
89 |
Byggmax's sustainability report presents GRI disclosures concerning its primary commercial operations. These operations comprise the store organization of Byggmax AB, including aliates, as well as the subsidiary Svea Distribution, where applicable. The administration element of the organization is not included in the sustainability report, since this is not included in core operations. All Group subsidiaries, except Byggmax Fastighetsutveckling AB, are jointly reported unless otherwise specied. Byggmax Fastighetsutveckling AB is not reported at all, since the company did not conduct any signicant operations in 2013. Signicance is dened on a case-by-case basis, based on what indicator is being reported, since no general denition covers all indicators. The denitions of signicance and limitations for each indicator have been made in close collaboration with an external consultant. Byggmax has identied that the stakeholders expected to deploy the sustainability report comprise suppliers, employees, customers, shareholders and nanciers.
Listed below are the indicators for which Byggmax does not report according to GRI guidelines, since they are not deemed relevant, or for which reporting is briefer. The explanation below is general and not exhaustive. A more complete explanation was reviewed by an external party.
Byggmax has not made any infrastructure or service investments, which are primarily made for the benet of the public. While Byggmax has indirectly impacted in a number of ways, such as making pellets more available, these initiatives are not deemed sucient to warrant a separate item in the report.
Since Byggmax is not a production company, this is not relevant.
Since Byggmax is not a production company, this is not relevant.
The EN8 indicator is not relevant for Byggmax since water consumption only pertains to household purposes and not production purposes. All of Byggmax's water consumption derives from municipal water.
The EN9 indicator is not relevant for Byggmax since water consumption only pertains to household purposes and not production purposes.
The EN10 indicator is not relevant for Byggmax since water consumption only pertains to household purposes and not production purposes.
According to the GRI's denition of indirect emissions of greenhouse gases by weight, this information falls outside the framework for our system limits thus rendering it immeasurable within the organization.
Byggmax does not cause emissions of ozone-depleting substances.
Byggmax had no planned or unplanned water emissions in 2013. Household wastewater, which is the only source of water emissions at Byggmax, does not qualify as water emissions under GRI's denition.
Since Byggmax is not a production company, this is not relevant. Regarding packaging and advertisements, refer to the environmental report.
No known events in 2013.
Byggmax has not been ned or sanctioned due to any transgressions of environmental legislation or regulations.
No dierences in benets to full-time or part-time employees have been noted at Byggmax.
Collective bargaining agreements are applied for 100 percent of sta.
Periods of notice are specied in the collective bargaining agreement.
Since Byggmax only conducts operations in the Nordic region, where the healthcare system is well-established and there are very few contagious diseases, no special training or consulting was conducted concerning contagious diseases for the company's employees. Where applicable, such situations are managed by Byggmax's personnel department or by the crisis group.
Signicant investment decisions for Byggmax comprise the opening of new stores. Since these are conducted in the Nordic region, where Byggmax believes that human rights are respected to an extremely high degree, no particular consideration is paid to human rights in these decisions.
A total of 61 percent of the major suppliers (90 percent of sales) were reviewed by way of a supplier survey in 2012. No signicant changes have occurred in the supplier base and, accordingly, the next survey will be carried out in 2014.
No operations have been identied in which the right to freedom of association and the right to collective bargaining agreements could be signicantly threatened. It should be noted that Byggmax purchases most of its material in the Nordic region.
No operations have been identied in which there is a signicant risk of child labor. It should be noted that Byggmax purchases most of its material in the Nordic region.
No operations have been identied in which there is a signicant risk of forced labor or mandatory work. It should be noted that Byggmax purchases most of its material in the Nordic region.
All stores are routinely analyzed in terms of wastage, transactions that deviate from the norm and other indicators.
Store managers' introductory training courses include ethical guidelines and corruption management.
Byggmax always reports incidents of corruption to the police. In 2013, no police reports were led.
Byggmax does not directly participate in political decision-making processes or lobbying, except for building permits.
Byggmax does not give any contributions or gi°s to political parties, politicians or similar institutions.
No actions have been taken against Byggmax for anti-competitive activities, transgressions of competition legislation or antitrust behavior.
In 2013, Byggmax did not pay any nes for non-compliance with laws or regulations.
Byggmax's policy stipulates that all products must have a product
description. Furthermore, society requires certain products, primarily of a chemical nature, to have a safety data sheet. This comprises 15 percent of all products.
All decisions concerning PR, marketing and sponsorship are made by the Marketing Manager or President. There is no formal policy for sponsorship or other marketing, beyond complying with the prevailing legislation.
No known transgressions in 2013.
No complaints concerning transgressions of customer integrity in 2013.
EC5 EC9 EN5 EN6 EN13 EN14 EN15 EN24 EN25 EN29 EN30 LA6 LA9 LA11 LA12 HR3 HR8 HR9 PR2 PR4 PR5
No nes were paid in 2013 for breaches against the prevailing laws and regulations concerning the supply and deployment of products and services.
*Byggmax has addressed, but not reported, the indicators below. These are supplementary indicators according to GRI.
Tyréns (the Reviewer) has reviewed Byggmax's sustainability report for the 2013 scal year. The review was based on GRI version 3.0. The Reviewer can arm that the work was conducted in a goal-oriented and ambitious manner and that the information that is presented in the nal sustainability report is factual and traceable. Byggmax has responded appropriately to the reviewer's questions and provided supplementary documentation upon request. When it has not been possible to comply with the GRI guidelines and the indicator index in its entirety, Byggmax has provided explanations that have been approved by the Reviewer.
In addition to reviewing the 2013 sustainability report, the Reviewer had good insight into the processes in 2011, 2012 and 2013 aimed at building up procedures for and implementing Byggmax's rst sustainability report for 2011. The Reviewer also had good insight into the decisions behind and preparation of documentation for the nal report. The Reviewer noted positive progress in the organization's management and reporting of sustainability issues. The scope and limitation of the report were also conducted in sucient accordance with GRI's instructions.
The Reviewer can with a high but not absolute degree of certainty state that the sustainability report fullls the criteria for the A+ application level.
.
Return on operating capital employed: EBITA divided by average operating capital.
Return on equity: Earnings for the year divided by average equity.
EBITDA: EBIT before depreciation/amortization and impairment.
EBITA: EBIT a°er depreciation/amortization and impairment but before deduction for impairment of goodwill.
Average net capital employed: Each year's monthly net capital employed has been weighted in the same manner to calculate an average.
Average operating capital employed: Operating capital employed for the past two years divided by two.
Net operating capital: Balance-sheet data from the principal ledger (not amended), measured as the total of inventory, accounts receivable, receivables on bonus from suppliers, other receivables and prepaid expenses/accrued income less the total of accounts payable, tax liabilities, other current liabilities and accrued expenses/deferred income.
Net debt: Interest-bearing liabilities less cash and cash equivalents.
Net debt/equity ratio: Net debt divided by equity.
Interest-coverage ratio: EBITDA in relation to total interest expenses.
Operating margin (EBIT margin): EBIT (operating prot) divided by net sales.
Equity/assets ratio/risk-bearing capital: Adjusted shareholders' equity plus subordinated shareholder loans divided by total assets.
Operating capital: Equity plus net debt.
Shareholders' equity per share: Shareholders' equity divided by the number of outstanding shares.
Net debt/EBITDA: : Interest-bearing liabilities excluding shareholder loans minus cash and cash equivalents divided by EBITDA.
Dividend per share: Dividend divided by the number of shares.
Cash flow from business activities per share: Cash flow from business activities for the period divided by the number of shares.
Stock turnover: Inventory costs for the year divided by the average inventory (mean value of incoming and outgoing inventory value).
Growth in like-for-like sales: A comparable unit (like-for-like unit) is regarded as comparable from the second year-end a°er the store has opened. For example, this means that a store that opened in 2011 is classied as a comparable unit from 2013. Stores relocated to new premises in an existing location are treated in the same manner.
Transported goods [tons] : The amount of goods, in tons, that are transported from suppliers to Byggmax facilities and distribution centers.
Transport work [ton km]: The mass in tons of every individual type of goods multiplied by the transport distances in kilometers.
Transport work per ton [ton km/ton]: The amount of transport work per ton of goods transported.
CO2 per ton of goods transported [kg]: CO2 emissions per ton of goods transported.
Mixed waste: Unsorted material that is not packaging. Paper, corrugated board, wood and plastic, mixed scrap, textiles and non-combustible waste.
Landll, unsorted: General waste that is not suitable for recycling or energy recovery.
Sorted waste: Not landll or mixed waste.
Byggmax's Annual Report is available only via the Group's website.
Shareholders in the Byggmax Group AB (publ), corporate registration number 556656-3531, are invited to attend the Annual General Meeting (AGM) on May 8, 2014, at 10:00 a.m. at Primus conference center, Primusgatan 18 in Stockholm.
Shareholders who wish to participate in the AGM must: both be listed in the register of shareholders maintained by Euroclear Sweden AB on Friday, May 2, 2014, and notify the company of their intention to attend the AGM, no later than at 4:00 p.m. on Friday, May 2, 2014.
Notice of participation in the AGM should be submitted in one of the following ways:
On noti¥ cation, shareholders must provide the following information:
When applicable, notice should be accompanied by full proof of authority such as the certi¥ cate of registration or its equivalent.
Shareholders who have registered their shares in the name of a trustee must temporarily re-register the shares in their own names in the register maintained by Euroclear Sweden AB in order to participate at the AGM. Such temporary re-registration must be executed no later than Friday, May 2, 2014, which means that shareholders are advised to notify their trustee well in advance of this date.
Welcome to Byggmax's investor relations pages at om.byggmax.se/en
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