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Komplett ASA
Quarterly Report • Apr 27, 2023
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Quarterly Report
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REPORT FOR THE FIRST QUARTER 2023
FIRST QUARTER 2023 KOMPLETT ASA
CONTENTS
HIGHLIGHTS
KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| HIGHLIGHTS
- X Challenging and uncertain market environment persists, although showing some signs of improvements
- X Continued revenue decline, yet improved gross margin across all business segments
- X Inventory levels tuned to meet seasonality and market demand with sufficient service levels
- X Synergy programme well underway and supported by good supplier relations and dynamics
- X Strong cost control maintained in a highly inflationary environment
- X Jaan Ivar Semlitsch was appointed as CEO of the group in February, and Thomas Røkke took up the position of group CFO in March
REVENUE PER SEGMENT
REVENUE PER COUNTRY
REVENUE PER CHANNEL
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| Amounts in NOK million unless stated otherwise | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Operating revenue | 3 618 | 2 606 | 14 618 |
| Growth (%) | 38.8 % | (0.8%) | 32.4 % |
| Gross profit ¹ | 511 | 308 | 1 794 |
| Gross margin (%) ¹ | 14.1 % | 11.8 % | 12.3 % |
| Operating expenses (ex dep) (adj.) ¹ | (420) | (240) | (1 451) |
| Depreciation and amortisation | (81) | (31) | (256) |
| Total operating expenses (adj.) ¹ | (502) | (271) | (1 707) |
| Operating cost percentage ¹ | (13.9%) | (10.4%) | (11.7%) |
| EBIT (adj.) ¹ | 9 | 37 | 87 |
| EBIT margin (adj.) (%) ¹ | 0.3 % | 1.4 % | 0.6 % |
| One-off costs | (13) | (18) | (80) |
| EBIT | (4) | 20 | 6 |
| Net financials | (48) | (9) | (104) |
| Profit before tax from continued operations | (53) | 11 | (98) |
| Profit for the period | (43) | 7 | (32) |
| Investments (capex) | 49 | 30 | 177 |
| Net Interest bearing debt ¹ | 1 438 | 1 118 | 1 434 |
| Operating free cash flow ¹ | 57 | (204) | 721 |
1) Alternative performance measure (APMs)
EBIT (adj.) NOK million ❚ 2022 ❚ 2023
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| CEO COMMENTS
On the 10th of February, I joined Komplett Group as the new CEO, and despite challenges in the past year, I see a clear and profitable route for Komplett going forward. While we continue to develop our strengths and market position, we will, in parallel, strive towards accelerating profitable organic growth.
Our core brands, Komplett, NetOnNet and Webhallen, have strong growth potential. They are well positioned amongst a large group of consumers and have some of our industry's highest customer satisfaction ratings. Moreover, our cost position remains solid, with the lowest cost base in the retail industry. We are confident that improved sourcing terms, increased visibility and awareness of our brands, increased customer club participation and a more solid price position will nurture future growth and higher margins moving forward. Therefore, we will, as a group, scale benefits while maintaining local ownership and execution of our brands.
As of the 1st of May, I will also have a new and strong management team in place. The team is a result of external and internal hires, which points to the strong culture at Komplett. I would also like to acknowledge all my new colleagues who have made my transition into the new role both educational and enjoyable. I have had the opportunity to visit many of our locations in Norway and Sweden and I have been impressed by the engagement as well as the strong and proactive corporate culture I have met across the group.
Having closed off the first quarter of 2023, we see similar market conditions to that of 2022. Consumers are more careful with their spending, which is reflected in our revenues. We aligned our inventory position during Q1 to meet seasonal variations and secure a good service level, and the composition remains healthy. We have strengthened our market position due to an attractive product range and a good service level. A positive pattern that has also followed into the first quarter is improved gross margin. This is a result of good supplier partnerships, solid price management and tactics, as well as a healthy inventory and a good service level. Many of the campaigns have also been balanced between price and margin. I am also pleased to have seen the strong performance of our private labels and see further potential for growing this business.
Furthermore, we are experiencing strong engagement from suppliers, which represents significant opportunities as a consequence of larger scale together with NetOnNet. To date, we are underway to reach the expected synergies. The initiatives made in 2022 to strengthen the group's financial position also mean that we are in a good position to support the organic growth opportunities we have identified based on our well-recognised brands, leading same-day delivery and last mile service and excellent shopping experiences.
Towards the end of the quarter, we released our Annual and Sustainability Report for 2022. Part of what is high on our agenda is the transition to a circular economy, as we note that consumers are increasingly concerned with
circular services and products. Sustainability is a crucial part of our long-term strategy and part of what we want to achieve can be summarised across our three sustainability pillars: increased durability and reusability of everything we sell, to record, document and limit our emissions and promote an inclusive work environment. I am proud of what we have achieved to date and look forward to working closely with the team to ensure we meet our targets in the future.
We have an exciting road ahead of us, and I look forward to sharing further thoughts and insights during the upcoming year.
Yours sincerely
Jaan Ivar Semlitsch CEO Komplett ASA
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| QUARTERLY SUMMARY
As expected, the demand environment in consumer electronics continued to be challenging in the first quarter, with low consumer sentiment in all key markets. On the positive side, the pricing environment in the industry showed signs of improvement and Komplett continued its positive trend in gross margins.
During the quarter, Komplett continued to maintain a healthy inventory position and optimise its cost base. Supplier negotiations to realise synergies following the combination with NetOnNet are progressing as planned.
A STRENGTHENED BUSINESS IN A CHALLENGING DEMAND ENVIRONMENT
Total revenue for the group amounted to NOK 3 618 million compared with NOK 2 606 million in the same period in 2022. The revenue increase was driven by the acquisition of NetOnNet, which contributed NOK 1 289 million in revenues. Improved pricing conditions and a healthy inventory partly compensated for the shortfall in sales, and translated into gross margin progress across the group compared
with previous quarters. This combined with good cost control partly mitigated the negative effects from cost inflation and contributed to an adjusted EBIT result for the group of NOK 9 million, corresponding to an adjusted EBIT margin of 0.3 per cent.
NetOnNet was consolidated into Komplett's financial statements as of 1 April 2022 and has been reported as a part of the B2C segment as of Q2 2022.
| FINANCIAL REVIEW
PROFIT AND LOSS
Total operating revenue increased by 38.8 per cent in the first quarter of 2023, from NOK 2 606 million to NOK 3 618 million. The increase was driven by the combination of Komplett and NetOnNet, where NetOnNet contributed NOK 1 289 million in revenue in the quarter. Excluding the contribution from NetOnNet, the group's revenue decreased by 10.6 per cent, mainly due to the challenging demand conditions for online retail across the group's key markets.
first quarter, compared with NOK 2 298 million in the same period last year. The increase is driven by the inclusion of NetOnNet, which accounted for NOK 1 083 million.
Gross profit for the first quarter increased from NOK 308 million last year to NOK 511 million in 2023. NetOnNet represented NOK 206 million of the gross profit. Despite an underlying volume decline, the gross margin continued to improve and reached 14.1 per cent in the first quarter, corresponding to an increase from 11.8 per cent in the same period of 2022. The
progress was partly driven by the inclusion of NetOnNet, which has a business model with a higher gross margin. In addition, good supplier relations and an improved pricing environment contributed positively, with healthier inventory positions and less price pressure in the industry compared with the prior-year period.
Operating expenses, including depreciation and amortisation, but excluding one-off costs, totalled NOK 502 million in the first quarter, compared with NOK 271 million in the comparable period of 2022. The increase was mainly
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HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
driven by NetOnNet, which represented NOK 193 million. Moreover, the group's operating expenses were subject to the general cost inflation. In an industry-perspective, the group has nevertheless maintained its leading cost position.
Excluding effects from acquired companies and amortisation of acquired customer value, operating expenses in the first quarter of 2023 totalled NOK 281 million. Like-for-like operating expenses same quarter last year was NOK 260 million, or a 8.2 per cent increase.
Depreciation and amortisation accounted for NOK 81 million, of which NOK 13 million was related to the amortisation of acquired customer value, and NetOnNet represented NOK 35 million. In the same period last year, depreciation and amortisation totalled NOK 31 million.
Adjusted EBIT amounted to NOK 9 million in the first quarter of 2023, compared with NOK 37 million in the first quarter of 2022. The reduction was caused by a volume decline in a softer market. This resulted in an adjusted EBIT margin of 0.3 per cent in the first quarter, compared with 1.4 per cent in the same quarter of last year.
One-off costs totalled NOK 13 million in the quarter, and were mainly related to reorganisation and restructuring, as well as associated expenses.
The operating result (EBIT) for the first quarter amounted to a loss of NOK 4 million, compared with a profit of NOK 20 million in the same period of 2022. EBIT from NetOnNet represented NOK 14 million.
Net financial expenses in the first quarter totalled NOK 48 million, compared with NOK 9 million in the same period last year. The increase is mainly driven by higher interest expenses, based on higher loans and higher interest, factoring expenses and non-recurring expenses related to establishment of the new credit facility.
Tax income was NOK 10 million in the first quarter, compared with a tax expense of NOK 4 million in the same period last year.
Loss for the period came in at NOK 43 million, compared with a profit of NOK 7 million in the first quarter of last year
FINANCIAL POSITION AND LIQUIDITY
Consolidated financial position
Non-current assets amounted to NOK 4 780 million at the end of the first quarter of 2023, compared with NOK 1 006 million in the same period in 2022. Non-current assets from NetOnNet accounted for NOK 471 million. In addition, the increase from the previous year was related to goodwill adjustments of NOK 1 815 million and an increase in other intangible assets of NOK 1 436 million.
Current assets amounted to NOK 3 326 million at the end of the first quarter of this year, compared with NOK 2 185 million in the same period last year. Current assets from NetOn-Net accounted for NOK 1 563 million, including NetOnNet's inventory position of NOK 1 065 million at the end of March 2023.
Cash and cash equivalents totalled NOK 485 million at the end of the quarter versus NOK 23 million at the end of March last year.
Equity amounted to NOK 3 688 million at the end of the first quarter of 2023, compared with NOK 806 million in the same period last year. The increased equity compared with 31 March 2022 was mainly driven by an increased share premium from the issuance of 35 242 424 new shares to SIBA Invest as part of the settlement of the acquisition of NetOnNet, and the issuance of 67 843 582 new shares in connection with the private placement in 2022 and subsequent offering in January 2023. Following the issuance of these shares, the company's share capital is NOK 70 136 464.40, divided into 175 341 161 shares, each with a nominal value of NOK 0.40.
This gave an equity ratio of 45.5 per cent at the end of the first quarter compared with 25.3 per cent in the same period of 2022.
Total liabilities amounted to NOK 4 419 million at the end of the first quarter of 2023, compared with NOK 2 385 million in the same period last year. The main drivers were the inclusion of NetOnNet, which accounted for NOK 1 510 million, higher trade payables and increased long-term debt.
Total equity and liabilities amounted to NOK 8 107 million at the end of the first quarter of 2023, compared with NOK 3 191 million in the same period last year.
LIQUIDITY
During the first quarter, the company repaid the remainder of the bridge loan facility which
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
was established in connection with the acquisition of NetOnNet and refinanced in the fourth quarter of 2022.
The group's total credit facilities include a revolving credit facility in the amount of NOK 1 300 million, a credit facility of SEK 100 million, and an overdraft facility in the amount of NOK 400 million. The latter is increased to NOK 500 million in the fourth quarter of each year.
At 31 March 2023, NOK 56 million of the credit facility and NOK 1 255 million of the revolving credit facility were utilised. Including available cash of NOK 485 million, the liquidity reserve
was NOK 975 million at the end of the first quarter, compared with NOK 316 million one year earlier.
Net interest-bearing debt at 31 March was NOK 826 million excluding IFRS 16 and NOK 1 438 million including IFRS 16. The leverage ratio (NIBD / LTM EBITDA (pro forma and adjusted for certain exceptional items)) was 3.8x at the close of the first quarter of 2023.
CASH FLOW
Operating activities generated a net cash flow of NOK 189 million in the first quarter, compared with a net cash outflow of NOK 158 million in the same period last year. Operating cash flow was primarily driven by inventory increase, trade receivables reductions and changes in other current receivables.
Cash flow used in investing activities was NOK 45 million, compared with NOK 31 million in the same quarter last year.
Cash flow from financing activities was NOK 193 million during the first quarter, compared with NOK 171 million in the same quarter prior year. The changes from last year were primarily related to refinancing of the group's debt facilities.
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HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| SUSTAINABILITY
On 23 March 2023, Komplett Group published its Annual and Sustainability report for 2022. During 2022, Komplett conducted a groupwide materiality assessment which reaffirmed that circularity, tolerance, and environment should remain its top priorities across all the group's companies. During the year, the group
made significant progress in promoting circular business practices. Komplett also improved its efforts to promote diversity and enhanced the data quality in the group-wide climate accounting. For further details, please read more on: https://online.fliphtml5.com/gntm/ umxq/#p=1
| CORPORATE EVENTS
SUBSEQUENT OFFERING COMPLETED
On 6 January 2023, the company launched a subsequent offering of up to 3 390 000 new shares at a subscription price of NOK 14.75. The company received subscriptions for a total of 43 582 shares. Following the issuance of these shares, the company's share capital is NOK 70 136 464.40, divided into 175 341 161 shares, each with a nominal value of NOK 0.40.
MANAGEMENT CHANGES
Effective from 10 February 2023, Jaan Ivar Semlitsch was appointed the new Chief Executive Director (CEO) of Komplett ASA. Mr. Semlitsch took over the role from Lars Olav Olaussen, who was the CEO of Komplett since 2018.
As of 1 March 2023, Thomas Røkke took over the role of Chief Financial Officer (CFO) of Komplett ASA.
Effective from 1 February 2023, Erlend Stefansson has headed the group's new B2B function consisting of Itegra, Komplett Bedrift, Komplett Företag and Ironstone.
The management team consists of Jaan Ivar Semlitsch (CEO), Thomas Røkke (CFO), Susanne Holmström (managing director NetOnNet), Anders Torell (managing director Webhallen), Erlend Stefansson (managing director B2B), Trine-Lise Jensen (head of group SC/IT program), Kristin Hødal Torgersen (chief HR officer), and Roger Sandberg (chief procurement officer).
ANNUAL GENERAL MEETING
The annual general meeting will be held on 9 May 2023. Participation will be digital. The notice of the annual general meeting and appendices are available at: https://www.komplettgroup.com/investor-relations/as-an-investment/general-meetings/
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| RISKS AND UNCERTAINTIES
Komplett Group is subject to several risks, including market and competition risks, operational and financial risks, such as currency, interest, credit, and liquidity risks, as well as IT security risks. The board and executive management are continuously monitoring the group's risk exposure, and the group strives to take an active approach to risk management and internal control processes. Below is a summary of the key risks for the group over the coming period.
There is a risk that consumer sentiment and spending expectations remain at submersed levels due to macroeconomic uncertainty, which in turn may impact demand for capital intensive goods such as electronics.
Market headwinds may lead to inventory build-up, resulting in increased price pressure in the market. The long-term growth trajectory of the online share of total retail trade sustains, but temporary fluctuations may impact the group's performance in the short term.
The group operates in an intensely competitive industry, and entry of new market players, regulatory changes or changes in market dynamics may impact its competitive position.
The current geopolitical situation may also impact the costs and availability of raw materials and other input factors. Due to its onlinefirst business model, the group is less exposed to cost inflation than many of its peers, but its cost base is nevertheless subject to market
inflation and currency effects.
As the group operates online, it is vulnerable to hacking and cybercrimes on critical applications and its websites. Although having systems in place to identify and block external attacks, the group will likely be subject to new and smarter attempts at unauthorised access that expose a risk to the business.
Risks and uncertainties must be considered when looking at the outlook comments below. Reference is made to the prospectus from the subsequent offering dated 4 January 2023, section 2, and note 4 in the company's Annual and Sustainability Report for 2022 for additional explanations regarding risks and uncertainties.
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| SUMMARY AND OUTLOOK
As anticipated, the challenging demand environment for consumer electronics has continued into 2023. Market uncertainty persists, and low consumer sentiment and moderate spending expectations are expected to impact top line performance also going forward, but over time, demand is expected to return to its attractive growth trajectory.
For Komplett Group, good supplier partnerships, improved pricing conditions and a sought-after product assortment resulted in a significant uplift in gross margins across the group in the first three months of the year.
Looking ahead, the group's gross margin performance is expected to continue to improve compared with prior-year periods. This will be supported by healthier inventory and an improved pricing environment relative to last year when excess inventory resulted in high campaign activity and price pressure across the industry.
The combination with NetOnNet allows for significant economies of scale. Execution of the integration continues to progress as planned, and to date, the group is well underway to reach the expected synergies.
The group's cost base is subject to general market inflation, but its online-first business model, makes it less exposed to cost inflation than many of its peers. A key priority for the group is to maintain its industry-leading cost position, even in a cost-inflationary environment.
Komplett Group expects annual capital expenditures related to maintenance at the level of NOK 80-100 million for the period 2023-2025. The planned expansion of supply chain facilities and upgrades to the group's IT systems could involve substantial capex investments in the coming years. As communicated before, no committed agreements have been made, and the board will evaluate future capex needs based on market development. A change in the phasing of future investments relating to these initiatives may require some adjustments to the capitalised development costs.
Moving forward, Komplett Group will strive towards accelerating profitable organic growth, while maintaining our industry-leading cost position. In order to do so, the group will combine scale benefits as a group while at the same time maintaining local ownership and execution of its brands.
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| SEGMENT REVIEW
| BUSINESS TO CONSUMER (B2C)
X Gross margin progress in a challenging demand and cost environment
REVENUE
Operating revenue for the B2C segment, including revenue from NetOnNet of NOK 1 289 million, increased to NOK 2 503 million, compared with NOK 1 343 million for the same period in 2022. The demand environment in consumer electronics continued to be challenging in all key markets, which resulted in an underlying decline in sales revenue.
In local currency, the operations in Norway and Sweden, excluding NetOnNet, had a revenue decline of 12 per cent and 9 per cent, respectively. Denmark, which represents approximately 5 per cent of the B2C revenue, had a decline of 24 per cent.
GROSS PROFIT
The overall gross profit for the B2C segment amounted to NOK 392 million in the first quarter, compared with NOK 186 million in the same quarter in 2022. This increase is a result of the combination of Komplett and NetOnNet, where NetOnNet contributed NOK 206 million.
Gross margin ended at 15.7 per cent compared with 13.9 per cent in the same quarter of 2022. The improvement is in part driven by positive mix effects from the inclusion of NetOnNet, due to its higher-margin product mix. In addition, an improved pricing environment compared with last year, a healthy inventory and good supplier partnerships contributed positively.
OPERATING EXPENSES
B2C operating expenses were NOK 380 million in the first quarter, compared with NOK 181 million for the same period in 2022. The increase is driven by NOK 194 million from NetOnNet.
The operating cost percentage increased to 15.2 per cent, from 13.5 per cent in the same quarter of last year. The increase is driven by a higher operating cost percentage in NetOnNet which has a higher share of physical stores, combined with the underlying reduction in sales volume and overall cost inflation.
EBIT
EBIT in the first quarter amounted to NOK 12 million, compared with NOK 6 million in the first quarter of 2022. The EBIT result includes a contribution from NetOnNet of NOK 12 million.
For the first quarter, the EBIT margin came in at 0.5 per cent compared with a margin of 0.4 per cent in the prior-year period.
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
B2C – KEY FIGURES
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Operating revenue | 2 503 | 1 343 | 9 785 |
| Growth (%) | 86.4 % | (14.6%) | 53.3 % |
| Gross profit¹ | 392 | 186 | 1 334 |
| Gross margin (%) ¹ | 15.7 % | 13.9 % | 13.6 % |
| Operating expenses (ex. dep) | (362) | (171) | (1 259) |
| Depreciation and amortisation | (18) | (10) | (64) |
| Total operating expenses (adj.) ¹ | (380) | (181) | (1 322) |
| Operating cost percentage ¹ | (15.2%) | (13.5%) | (13.5%) |
| EBIT | 12 | 6 | 12 |
| EBIT margin (%) ¹ | 0.5 % | 0.4 % | 0.1 % |
1) Alternative performance measure (APMs).
1 343
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| BUSINESS TO BUSINESS (B2B)
X Improved gross margin despite sales decline
REVENUE
Operating revenue for the B2B segment in the first quarter amounted to NOK 379 million, compared with NOK 435 million for the same period in 2022. Revenue in the B2B segment was impacted by lower demand from smaller businesses in the SME segment, which are displaying similar behaviours to that of consumers in the B2C segment.
In local currency, the operation in Norway delivered a decline of 10 per cent, while Sweden had a revenue decline of 1 per cent.
GROSS PROFIT
Gross profit was NOK 72 million in the first quarter, compared with NOK 73 million in the same quarter of 2022. The gross margin came in at 18.9 per cent, representing an improvement compared with 16.7 per cent in the prior-year. Improved pricing conditions and an attractive inventory position positively impacted the gross margin.
OPERATING EXPENSES
Total operating expenses in the quarter were NOK 47 million compared with NOK 40 million in the same quarter in 2022.
Operating expenses relative to the operating revenue increased to 12.5 per cent in the quarter compared with 9.2 per cent in the same quarter in 2022. The increase was driven by higher marketing investments and general cost inflation, combined with a lower revenue base.
EBIT
EBIT for the first quarter was NOK 24 million, compared with NOK 33 million in the first quarter of 2022. The decline was a result of higher operating costs. This gave an EBIT margin for the quarter of 6.4 per cent compared with 7.5 per cent in the same quarter of last year.
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B2B – KEY FIGURES
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Operating revenue | 379 | 435 | 1 615 |
| Growth (%) | (13.0%) | 20.5 % | 5.7 % |
| Gross profit¹ | 72 | 73 | 276 |
| Gross margin (%) ¹ | 18.9 % | 16.7 % | 17.1 % |
| Operating expenses (ex. dep) | (45) | (38) | (152) |
| Depreciation and amortisation | (2) | (2) | (8) |
| Total operating expenses (adj.) ¹ | (47) | (40) | (160) |
| Operating cost percentage ¹ | (12.5%) | (9.2%) | (9.9%) |
| EBIT | 24 | 33 | 116 |
| EBIT margin (%) ¹ | 6.4 % | 7.5 % | 7.2 % |
1) Alternative performance measure (APMs).
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| DISTRIBUTION
X Steady operations, but impacted by cost inflation and weaker consumer sentiment
REVENUE
Revenues for the Distribution segment amounted to NOK 734 million in the first quarter, compared with NOK 825 million for the same period in 2022. An overall weaker consumer sentiment impacted demand also in the Distribution segment. In addition, the sales volume to large accounts declined from Q1 2022, when a large order backlog was delivered.
In local currency, the operation in Norway delivered a decline of 10 per cent, and Sweden had a revenue decline of 22 per cent
GROSS PROFIT
Gross profit was NOK 44 million in the first quarter compared with NOK 46 million in the same quarter of 2022. The gross margin increased by 0.4 percentage points to 6.0 per cent. The gross margin progress was partly explained by product and client mix.
OPERATING EXPENSES
Operating expenses were stable at NOK 31 million in the first quarter of 2023 compared with NOK 30 million in the same period in 2022.
Measured as a percentage of revenue, the operating expenses were 4.2 per cent in the first quarter, compared with 3.6 per cent in the same period last year. The increase was driven by the revenue decline combined with inflationary pressures.
EBIT
The EBIT result for the quarter was NOK 13 million, compared with NOK 17 million in the first quarter of 2022. This gave an EBIT margin of 1.8 per cent compared with 2.0 per cent for the same period in 2022.
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DISTRIBUTION – KEY FIGURES
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Operating revenue | 734 | 825 | 3 207 |
| Growth (%) | (11.1%) | 19.8 % | 2.7 % |
| Gross profit¹ | 44 | 46 | 173 |
| Gross margin (%) ¹ | 6.0 % | 5.6 % | 5.4 % |
| Operating expenses (ex. dep) | (29) | (28) | (103) |
| Depreciation and amortisation | (2) | (2) | (6) |
| Total operating expenses (adj.) ¹ | (31) | (30) | (109) |
| Operating cost percentage ¹ | (4.2%) | (3.6%) | (3.4%) |
| EBIT | 13 | 17 | 63 |
| EBIT margin (%) ¹ | 1.8 % | 2.0 % | 2.0 % |
1) Alternative performance measure (APMs).
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| OTHER / IFRS 16
"Other" represents group costs not allocated to the operating segments: B2C, B2B, and Distribution. This applies when costs are difficult to allocate fairly between the segments.
Typical cost elements under this segment include management costs and group strategic initiatives. The different effects of IFRS (International Financial Reporting Standards), especially IFRS 16, are not part of the operational measures and are excluded from the operating segments. For additional explanation, please refer to note 3 – Segment Information in this report.
REVENUE
Other operating revenue is related to income from royalties and totalled NOK 3 million in the quarter.
OTHER / IFRS 16 – KEY FIGURES
OPERATING EXPENSES
The operating expenses include positive IFRS 16 effects of NOK 28 million related to NetOn-Net and NOK 22 million related to the remainder of the group, which are reflected in increased depreciation.
Operating expenses, excluding depreciation and one-off costs, totalled positive NOK 15 million, compared with negative NOK 3 million in Q1 2022.
Depreciation and amortisation amounted to NOK 59 million, of which NOK 13 million is related to amortisation of acquired customer value.
Total operating expenses, including depreciation and excluding one-off costs, amounted to NOK 44 million, compared with NOK 21 million in the prior-year period. The increase is driven by amortisation of acquired customer value related to NetOnNet and other operating costs.
EBIT
Adjusted EBIT amounted to negative NOK 41 million, compared with negative NOK 18 million in the prior-year period.
During the first quarter of 2023, a total of NOK 13 million were booked as one-off costs from reorganisation and restructuring as well as related expenses.
NET FINANCIALS
Net financial expenses were NOK 48 million for the first quarter of 2023, compared with NOK 9 million in the first quarter of 2022. The increase is mainly driven by higher interest expenses, based on higher loans and increased interest, factoring expenses and non-recurring expenses related to establishment of the new credit facility.
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Operating revenue | 3 | 3 | 11 |
| Gross profit¹ | 3 | 3 | 11 |
| Operating expenses (ex. dep) | 15 | (3) | 63 |
| Depreciation and amortisation | (59) | (18) | (178) |
| Total operating expenses (adj.) ¹ | (44) | (21) | (115) |
| EBIT (adj.)¹ | (41) | (18) | (105) |
| One-off costs | (13) | (18) | (80) |
| EBIT | (54) | (36) | (185) |
| Net financials | (48) | (9) | (104) |
| Profit before tax | (103) | (45) | (289) |
PAGE 17
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| FINANCIAL STATEMENTS AND NOTES
| CONDENSED CONSOLIDATED INTERIM STATEMENT OF PROFIT AND LOSS
Unaudited for the period ended 31 March 2023
| Amounts in NOK million | Note | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|---|
| Unaudited | Unaudited | Audited | ||
| Total operating revenue | 3, 4 | 3 618 | 2 606 | 14 618 |
| Cost of goods sold | (3 108) | (2 298) | (12 824) | |
| Employee benefit expenses | (248) | (136) | (820) | |
| Depreciation and amortisation expense | 6, 7 | (81) | (31) | (256) |
| Other operating expenses | 7 | (186) | (122) | (712) |
| Total operating expenses | (3 623) | (2 587) | (14 612) | |
| Operating result (EBIT) | (4) | 20 | 6 | |
| Net finance income and expenses | 7 | (48) | (9) | (104) |
| PROFIT BEFORE TAX | (53) | 11 | (98) | |
| Tax expense | 10 | (4) | 56 | |
| PROFIT FROM CONTINUING OPERATIONS | (43) | 7 | (42) | |
| Profit/loss on discontinued operations | - | - | 10 | |
| PROFIT FOR THE PERIOD | (43) | 7 | (32) | |
| OTHER COMPREHENSIVE INCOME | ||||
| Items that will or may be reclassified to profit or loss: | ||||
| Foreign currency rate changes | 233 | (7) | 14 | |
| TOTAL COMPREHENSIVE INCOME | 190 | (0) | (18) |
Earnings per share (basic and diluted) 5 (0,25) 0,09 (0,31)
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
| Amounts in NOK million | Note | 31.03.2023 | 31.03.2022 | 31.12.2022 |
|---|---|---|---|---|
| Unaudited | Unaudited | Audited | ||
| ASSETS | ||||
| Non-current assets | ||||
| Goodwill | 6 | 2 250 | 432 | 2 131 |
| Software | 6 | 257 | 123 | 218 |
| Other intangible assets | 6 | 1 508 | 71 | 1 424 |
| Total intangible assets | 4 015 | 626 | 3 773 | |
| Right-of-Use assets | 6, 7 | 616 | 276 | 559 |
| Machinery and fixtures | 6 | 131 | 34 | 134 |
| Total property, plant and equipment | 747 | 311 | 692 | |
| Deferred tax asset | - | 25 | - | |
| Investments in equity-accounted associates | 10 | 12 | 14 | |
| Other receivables | 7 | 9 | 33 | 8 |
| Total other non-current assets | 19 | 70 | 22 | |
| Total non-current assets | 4 780 | 1 006 | 4 487 | |
| Current assets | ||||
| Inventories | 2 129 | 1 083 | 1 928 | |
| Trade receivables - regular | 189 | 609 | 309 | |
| Trade receivable from deferred payment arrangements | 105 | 112 | 91 | |
| Other current receivables | 7 | 418 | 358 | 568 |
| Cash and cash equivalents | 485 | 23 | 149 | |
| Total current assets | 3 326 | 2 185 | 3 046 | |
| TOTAL ASSETS | 8 107 | 3 191 | 7 533 |
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
| Amounts in NOK million | Note 31.03.2023 |
31.03.2022 | 31.12.2022 |
|---|---|---|---|
| Unaudited | Unaudited | Audited | |
| EQUITY | |||
| Share capital | 70 | 29 | 70 |
| Share premium | 3 741 | 1 075 | 3 741 |
| Other equity | (124) | (298) | (314) |
| TOTAL EQUITY | 3 688 | 806 | 3 496 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Deferred tax | 263 | - | 245 |
| Other obligations | 47 | 48 | 49 |
| Long-term loans | 11 1 255 |
400 | 400 |
| Non-current lease liabilities | 7 421 |
247 | 391 |
| Total non-current liabilities | 1 985 | 695 | 1 084 |
| Current liabilities | |||
| Short-term loans | 11 56 |
407 | 625 |
| Trade payables | 1 468 | 673 | 1 412 |
| Public duties payable | 356 | 257 | 395 |
| Current income tax | -11 | 70 | 17 |
| Current lease liabilities | 7 191 |
87 | 167 |
| Other current liabilities | 372 | 196 | 337 |
| Total current liabilities | 2 433 | 1 690 | 2 953 |
| TOTAL LIABILITIES | 4 419 | 2 385 | 4 037 |
| TOTAL EQUITY AND LIABILITIES | 8 107 | 3 191 | 7 533 |
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
| Amounts in NOK million | Note | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|---|
| Unaudited | Unaudited | Audited | ||
| Cash flows from operating activities | ||||
| Profit from continuing operations (before tax) | (53) | 11 | (98) | |
| Profit/loss on discontinued operations (before tax) | - | - | 12 | |
| Income taxes paid | (28) | - | (19) | |
| Depreciation and amortisation expense | 6 | 81 | 31 | 256 |
| Net finance items | 7 | 48 | 9 | 104 |
| Changes in inventories, trade payables and trade receivables | (25) | (161) | 958 | |
| Other changes in accruals | 164 | (47) | (111) | |
| Net cash flows from operating activities | 189 | (158) | 1 102 | |
| Investing activities | ||||
| Investments in property, plant and equipment | 6 | (49) | (30) | (177) |
| Acquisition of subsidiary, net of cash acquired | - | (1) | (1 526) | |
| Dividend from associated company | 4 | - | 2 | |
| Net cash used in investing activities | (45) | (31) | (1 701) | |
| Financing activities | ||||
| Proceeds from loans and borrowings | 1 255 | 100 | 1 500 | |
| Repayment of loans and borrowings | (400) | - | (1 000) | |
| Changes in bank overdrafts | (569) | 100 | (524) | |
| Principal and interest paid on lease liabilities | 7 | (50) | (22) | (165) |
| Net Interest paid on loans and overdrafts | (44) | (7) | (91) | |
| Issue of share capital | 1 | - | 987 | |
| Net cash (used in)/from financing activities | 193 | 171 | 706 | |
| Net increase in cash and cash equivalents | 336 | (18) | 108 | |
| Cash and cash equivalents at beginning of period | 149 | 41 | 41 | |
| Cash and cash equivalents at end of year | 485 | 23 | 149 |
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
| Share | Share | Other | Total | |
|---|---|---|---|---|
| Amounts in NOK million | capital | premium | equity | equity |
| At 1 January 2022 | 29 | 1 075 | (298) | 806 |
| Profit for the period | - | - | 7 | 7 |
| Other comprehensive Income | - | - | (7) | (7) |
| Total comprehensive Income for the period | - | - | (0) | (0) |
| Long-term incentive program | - | - | 1 | 1 |
| Contributions by and distributions to owners | - | - | 1 | 1 |
| At 31 March 2022 | 29 | 1 075 | (298) | 806 |
| At 1 January 2023 | 70 | 3 741 | (314) | 3 496 |
| Profit for the period | - | - | (43) | (43) |
| Other comprehensive Income | - | - | 233 | 233 |
| Total comprehensive Income for the period | - | - | 190 | 190 |
| Long-term incentive program | - | - | 1 | 1 |
| Issue of share capital | 0 | 1 | - | 1 |
| Contributions by and distributions to owners | 0 | 1 | 1 | 1 |
| At 31 March 2023 | 70 | 3 741 | (124) | 3 688 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| NOTES DISCLOSURE TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Unaudited for the period ended 31 March 2023
Note 01 GENERAL INFORMATION AND BASIS FOR PREPARATION
Komplett ASA and its subsidiaries (collectively, "the group's") operational activities are related to the sale of consumer and business electronics in Norway, Sweden and Denmark, to consumers, corporates and retailers.
All amounts in the interim financial statements are presented in NOK million unless otherwise stated.
These condensed interim financial statements have not been audited. The group's condensed interim financial statements are prepared according to IAS 34 Interim Financial Reporting. The interim reporting does not include all information that is normally prepared in a full annual financial statement and should be read in conjunction with the group's consolidated financial statement for the year ended 31 December 2022 (www.komplettgroup. com/investor-relations/financial-information/annual-reports/)
The accounting policies used in the group's interim reporting are consistent with the principles presented in the approved consolidated financial statement for 2022. There are no significant effects from the adoption of new standards effective as of 1 January 2023. The group has not voluntarily adopted any other standard that has been issued but is not yet mandatory.
Note 02 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of interim condensed financial statements requires management to make estimates and judgements that impact how accounting policies are applied and the reported amounts for assets, liabilities, income and expenses. Actual results may differ from these estimates. The accounting estimates and judgements are consistent with those in the consolidated financial statements for 2022.
Note 03 SEGMENT INFORMATION
Q1 2023
| Amounts in NOK million | B2C | B2B | Distri bution |
Other | IFRS 16 |
Total |
|---|---|---|---|---|---|---|
| Total operating revenue | 2 503 | 379 | 734 | 3 | 0 | 3 618 |
| Cost of goods sold | (2 111) | (307) | (690) | 0 | - | (3 108) |
| Employee benefit expenses | (184) | (22) | (16) | (26) | - | (248) |
| Depreciation and amortisation expense | (18) | (2) | (2) | (13) | (46) | (81) |
| Other operating expenses | (178) | (23) | (13) | (23) | 50 | (186) |
| Total operating expenses | (2 491) | (355) | (720) | (61) | 4 (3 623) | |
| Operating result (EBIT) | 12 | 24 | 13 | (58) | 4 | (4) |
| Net finance income and expenses | - | - | - | (43) | (5) | (48) |
| Profit before tax | 12 | 24 | 13 | (102) | (1) | (53) |
Q1 2022
| Distri | IFRS | |||||
|---|---|---|---|---|---|---|
| Amounts in NOK million | B2C | B2B | bution | Other | 16 | Total |
| Total operating revenue | 1 343 | 435 | 825 | 6 | (3) 2 606 | |
| Cost of goods sold | (1 157) | (362) | (779) | (0) | - (2 298) | |
| Employee benefit expenses | (80) | (22) | (17) | (17) | - | (136) |
| Depreciation and amortisation expense | (10) | (2) | (2) | (1) | (17) | (31) |
| Other operating expenses | (91) | (16) | (11) | (26) | 22 | (122) |
| Total operating expenses | (1 337) | (403) | (809) | (44) | 5 (2 587) | |
| Operating result (EBIT) | 6 | 33 | 17 | (38) | 2 | 20 |
| Net finance income and expenses | - | - | - | (6) | (3) | (9) |
| Profit before tax | 6 | 33 | 17 | (44) | (1) | 11 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Note 04 REVENUES FROM CONTRACTS WITH CUSTOMERS
Disaggregation based on type of customers
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Sale to consumers (B2C) | 2 503 | 1 343 | 9 785 |
| Sale to corporates (B2B) | 379 | 435 | 1 615 |
| Sale to resellers (Distribution) | 734 | 825 | 3 207 |
| Other | 3 | 3 | 11 |
| Total | 3 618 | 2 606 | 14 618 |
Revenues based on geographic location of customers
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Norway | 1 737 | 1 805 | 7 351 |
| Sweden | 1 819 | 728 | 7 025 |
| Denmark | 62 | 74 | 243 |
| Total | 3 618 | 2 606 | 14 618 |
Revenues by product or service
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Sale of goods | 3 541 | 2 558 | 14 299 |
| Other income | 78 | 49 | 319 |
| Total | 3 618 | 2 606 | 14 618 |
Note 05 EARNINGS PER SHARE
Earnings per share
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Profit for the period | (43) | 7 | (32) |
| Average number of shares | |||
| Shares at the beginning of the period | 175 297 579 | 72 255 155 | 72 255 155 |
| Effect of new shares* | 27 602 | - | 32 459 501 |
| Average number of shares | 175 325 181 | 72 255 155 | 104 714 656 |
| Earnings per share (basic and diluted) - in NOK | (0.25) | 0.09 | (0.31) |
* In connection with the acquisition of NetOnNet 4 April 2022, a total of 35 242 424 shares in Komplett were issued. 67 800 000 new share were issued conntected to the private placement in November and December 2022 , with a subsequent offer in January 2023 of 43,582 new shares.
Diluted earnings per share
There are no instruments or options that will have a dilutive effect on earnings per share as of 31 March 2023.
Note 06 FIXED ASSETS AND INTANGIBLE ASSETS
| Amounts in NOK million | Goodwill | Soft ware |
Other intan gible assets |
Machin ery, fur niture, fittings |
Right of use assets |
Total |
|---|---|---|---|---|---|---|
| Carrying amount as of 1 | ||||||
| January 2023 | 2 131 | 218 | 1 424 | 134 | 559 | 4 466 |
| Additions | - | 48 | - | 1 | 74 | 123 |
| Depreciation and amortisation | - | (13) | (13) | (10) | (46) | (81) |
| Foreign currency effects | 119 | 4 | 96 | 6 | 29 | 254 |
| Carrying amount as of 31 | ||||||
| March 2023 | 2 250 | 257 | 1 508 | 131 | 616 | 4 762 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Note 07 LEASES
The group's right-of-use assets, lease liabilities and lease receivables are categorised and presented in the table below:
Right of use assets
| Amounts in NOK million | Land and buildings |
Vehicles | Total |
|---|---|---|---|
| At 1 January 2023 | 557 | 2 | 559 |
| Additions including adjustments to existing contracts | 73 | 0 | 74 |
| Amortisation | (46) | (0) | (46) |
| Foreign currency effects | 29 | - | 29 |
| At 31 March 2023 | 614 | 2 | 616 |
| Economic life/lease term | 1-8 years | 1-3 years | |
| Amortisation method | Straight line |
Straight line |
|
| Lease liabilities | |||
| At 1 January 2023 | 558 | ||
| Additions | 42 | ||
| Interest expenses | 5 | ||
| Lease payments | (50) | ||
| Foreign currency effects | 58 | ||
| At 31 March 2023 | 612 | ||
| Whereof: |
Current lease liabilities 191 Non-current lease liabilities 421
Note 08 FINANCIAL INSTRUMENTS – FAIR VALUE
The group considers that the carrying amount of the following financial assets and financial liabilities are a reasonable approximation of their fair value:
- X Trade receivables X Long-term loans
- - X Cash and cash equivalents
- X Trade payables X Debt to financial institutions
-
Except for forward currency contracts which are booked at fair value, the group has no other financial assets or liabilities valued at fair value.
Note 09 RELATED PARTY TRANSACTIONS
In addition to subsidiaries and associated companies, the group's related parties include its majority shareholders, all members of the board of directors and key management, as well as companies in which any of these parties have either controlling interests, board appointments or are senior staff. All transactions have been entered into in accordance with the arms' length principle, meaning that prices and other main terms and conditions are deemed to be commercial.
All significant transactions with related parties that are not eliminated in the group accounts are presented below:
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 | |
|---|---|---|---|---|
| Parties | Type of transactions | |||
| Kullerød Eiendom AS ¹ | Lease of office and warehouse | 7 | 6 | 26 |
| F&H Asia Limited ¹ | Purchase of products | 3 | 36 | 66 |
| SIBA Fastigheter AB ² | Lease of offices and warehouse | 6 | - | 13 |
| Resurs& Solid ² | Sales of products | 2 | - | 7 |
| Resurs& Solid ² | Commission of services sold | 23 | - | 103 |
| Total | 41 | 42 | 215 |
1) Related entities owned by the company's ultimate parent company in the greater Canica group of companies. 2) Related entities owned by the company's ultimate parent company in the greater Siba group of companies.
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Note 10 TOP 20 SHAREHOLDERS
The 20 largest shareholders as at 31 March 2023
| Rank | Name | Holding | Stake | |
|---|---|---|---|---|
| 1 | Canica Invest AS | 74 376 317 | 42.42 % | |
| 2 | SIBA Invest AB | 55 581 404 | 31.70 % | |
| 3 | Verdipapirfondet Alfred Berg Gambak | 5 532 206 | 3.16 % | |
| 4 | The Bank of New York Mellon | 4 398 418 | 2.51 % | |
| 5 | The Northern Trust Comp. London Br | 3 300 000 | 1.88 % | |
| 6 | UBS AG | 3 002 198 | 1.71 % | |
| 7 | Verdipapirfondet Holberg Norge | 2 100 000 | 1.20 % | |
| 8 | Verdipapirfondet Holberg Norden | 2 100 000 | 1.20 % | |
| 9 | Morgan Stanley & Co. Int. Plc. | 1 894 188 | 1.08 % | |
| 10 | Sole Active AS | 1 883 646 | 1.07 % | |
| 11 | Wenaasgruppen AS | 1 273 370 | 0.73 % | |
| 12 | Verdipapirfondet Storebrand Norge | 1 177 214 | 0.67 % | |
| 13 | BNP Paribas | 1 130 558 | 0.64 % | |
| 14 | Verdipapirfondet Pareto Investment | 1 018 000 | 0.58 % | |
| 15 | UBS AG London Branch | 1 010 201 | 0.58 % | |
| 16 | Citibank. N.A. | 972 835 | 0.55 % | |
| 17 | UBS Europe SE | 921 740 | 0.53 % | |
| 18 | Strømstangen AS | 713 539 | 0.41 % | |
| 19 | Vineberg Invest AS | 713 538 | 0.41 % | |
| 20 | Citibank. N.A. | 597 783 | 0.34 % | |
| Total top 20 | 163 697 155 | 93.36 % | ||
| Total number of shares | 175 341 161 | 100.00 % | ||
Note 11 LOANS AND BORROWINGS
| Amounts in NOK million | Total facility | Classification | Utilised 31.03.2023 |
Utilised 31.03.2022 |
|---|---|---|---|---|
| Revolving Credit Facility | NOK 1 300 million Long-term loans | 1 255 | - | |
| Overdraft Facility | NOK 400 million | Short-term loans | - | - |
| Credit Facility | SEK 100 million | Short-term loans | 56 | 70 |
| Revolving Credit Facility | NOK 500 million | Long-term loans Short-term loans |
- - |
400 100 |
| Overdraft Facility | NOK 500 million | Short-term loans | - | 237 |
| Total | 1 311 | 807 |
The new facilities include covenants for a minimum equity ratio of 30 per cent and a ratio of net debt to EBITDA. Q1 2023 has been amended to 4,5x, Q2 2023 is 3.75x and then 3.0x thereafter. The credit facilities have a pledge in Property, plant and equipment and Current assets.
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| APPENDIX 1: EFFECT OF NETONNET IN Q1 COMPARED TO LAST YEAR
To explain the changes between reported figures for 2023 vs 2022, which are strongly affected by the acquisition of NetOnNet, the following specification has been made.
For further information regarding pro forma figures, please refer to the publication made at: https://www.komplettgroup.com/investor-relations/financial-information/
Statement of profit and loss
| Amounts in NOK million | Q1 2023 | Q1 2022 | Δ LY | Komplett | NetOnNet | Adjustment |
|---|---|---|---|---|---|---|
| Total Operating income | 3 618 | 2 606 | 1 012 | (277) | 1 289 | - |
| Cost of goods sold | (3 108) | (2 298) | (810) | 273 | (1 083) | - |
| Employee benefit expenses | (248) | (136) | (112) | (11) | (101) | - |
| Depreciation and amortisation expense | (81) | (31) | (50) | (2) | (35) | (13) |
| Other operating expenses | (186) | (122) | (64) | (8) | (56) | - |
| Total operating expenses | (3 623) | (2 587) | (1 036) | 252 | (1 275) | (13) |
| Operating result | (4) | 20 | (24) | (25) | 14 | (13) |
| Net finance income and expenses | (48) | (9) | (39) | (30) | (9) | - |
| Profit before tax | (53) | 11 | (63) | (55) | 4 | (13) |
| Tax expense | 10 | (4) | 14 | 12 | (1) | 2 |
| Profit for the period | (43) | 7 | (50) | (43) | 3 | (10) |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Statement of financial position - assets
| Amounts in NOK million | 31.03.2023 | 31.03.2022 | Δ LY | Komplett | NetOnNet | Adjustment |
|---|---|---|---|---|---|---|
| Non-current assets | ||||||
| Goodwill | 2 250 | 432 | 1 817 | 2 | - | 1 815 |
| Software | 257 | 123 | 135 | 79 | 55 | - |
| Other intangible assets | 1 508 | 71 | 1 437 | 1 | - | 1 436 |
| Total intangible assets | 4 015 | 626 | 3 389 | 83 | 55 | 3 251 |
| Right-of-Use assets | 616 | 276 | 339 | 7 | 333 | - |
| Other fixed assets | 131 | 34 | 97 | 19 | 78 | - |
| Total fixed assets | 747 | 311 | 436 | 26 | 410 | - |
| Deferred tax asset | - | 25 | (25) | (25) | - | - |
| Investments in equity-accounted associates | 10 | 12 | (2) | (2) | - | - |
| Other receivables | 9 | 33 | (25) | (31) | 6 | - |
| Total other non-current assets | 19 | 70 | (51) | (57) | 6 | - |
| Total non-current assets | 4 780 | 1 006 | 3 774 | 52 | 471 | 3 251 |
| Current assets | ||||||
| Inventories | 2 129 | 1 083 | 1 047 | (18) | 1 065 | - |
| Trade receivables - regular | 189 | 609 | (420) | (463) | 43 | - |
| Trade receivable from deferred payment | 105 | 112 | (7) | (7) | - | - |
| Other current receivables | 418 | 358 | 60 | (56) | 115 | - |
| Cash and cash equivalents | 485 | 23 | 462 | 121 | 340 | - |
| Total current assets | 3 326 | 2 185 | 1 141 | (422) | 1 563 | - |
| TOTAL ASSETS | 8 107 | 3 191 | 4 915 | (371) | 2 035 | 3 251 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Statement of financial position - equity and liabilities
| Amounts in NOK million | 31.03.2023 | 31.03.2022 | Δ LY | Komplett | NetOnNet | Adjustment |
|---|---|---|---|---|---|---|
| EQUITY | ||||||
| Share capital | 70 | 29 | 41 | - | 1 | 41 |
| Share premium | 3 741 | 1 075 | 2 666 | - | 74 | 2 592 |
| Other equity | (124) | (298) | 174 | (68) | 450 | (208) |
| TOTAL EQUITY | 3 688 | 806 | 2 882 | (68) | 525 | 2 425 |
| LIABILITIES | ||||||
| Non-current liabilities | ||||||
| Deferred tax | 263 | - | 263 | (30) | 8 | 284 |
| Other obligations | 47 | 48 | (1) | (11) | 10 | - |
| Long-term loans | 1 255 | 400 | 855 | 400 | 455 | - |
| Non-current lease liabilities | 421 | 247 | 174 | (31) | 205 | - |
| Total non-current liabilities | 1 985 | 695 | 1 291 | 329 | 677 | 284 |
| Current liabilities | ||||||
| Bank overdraft | 56 | 407 | (351) | (892) | - | 542 |
| Trade payables | 1 468 | 673 | 794 | 376 | 418 | - |
| Public duties payable | 356 | 257 | 100 | (36) | 136 | - |
| Current income tax | (11) | 70 | (81) | (77) | (4) | - |
| Current lease liabilities | 191 | 87 | 105 | (3) | 108 | - |
| Other current liabilities | 372 | 196 | 176 | 1 | 175 | - |
| Total current liabilities | 2 433 | 1 690 | 743 | (631) | 833 | 542 |
| TOTAL LIABILITIES | 4 419 | 2 385 | 2 033 | (303) | 1 510 | 826 |
| TOTAL EQUITY AND LIABILITIES | 8 107 | 3 191 | 4 915 | (371) | 2 035 | 3 251 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
| APPENDIX 2: ALTERNATIVE PERFORMANCE MEASURES (APMS)
The APMs used by Komplett Group are set out below (presented in alphabetical order):
EBIT adjusted: Derived from financial statements as operating result (EBIT) excluding one-off costs. The group has presented this item because it considers it to be a useful measure to show the management's view on the efficiency in the profit generation of the group's operations before one-off items.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Total operating revenue | 3 618 | 2 606 | 14 618 |
| EBIT | (4) | 20 | 6 |
| + One-off cost | 13 | 18 | 80 |
| = EBIT adjusted | 9 | 37 | 87 |
| EBIT margin adjusted | 0.3 % | 1.4 % | 0.6% |
EBIT margin adjusted: EBIT adjusted as a percentage of total operating revenue. The group has presented this item because it considers it to be a useful measure to show the management's view on the efficiency in the profit generation of the group's operations before one-off items as a percentage of total operating revenue.
Reconciliation - see above under EBIT adjusted.
EBIT margin: Operating result (EBIT) as a percentage of total operating revenue. The group has presented this item because it considers it to be a useful measure to show the management's view on the efficiency in the profit generation of the group's operations as a percentage of total operating revenue.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Total operating revenue | 3 618 | 2 606 | 14 618 |
| EBIT | (4) | 20 | 6 |
| EBIT margin | (0.1%) | 0.8 % | 0.0% |
EBITDA excl. impact of IFRS-16: Derived from financial statements as the sum of operating result (EBIT) plus the sum of depreciation and amortisation for the segments B2C, B2B, Distribution and Other. The group has presented this item because it considers it to be a useful measure to show the management's view on the overall picture of operational profit and cash flow generation before depreciation and amortisation in the group's operations, excluding any impact of IFRS-16.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| EBIT | (4) | 20 | 6 |
| - EBIT impact of IFRS 16 | (4) | (2) | (12) |
| + Dep B2C, B2B, Dist. Other | 35 | 14 | 115 |
| = EBITDA excl IFRS 16 | 27 | 32 | 109 |
Gross margin: Gross profit (as defined below) as a percentage of total operating revenue. The group has presented this item because it considers it to be a useful measure to show the management's view on the efficiency of gross profit generation of the group's operations as a percentage of total operating revenue.
Reconciliation - see below under gross profit.
Gross profit: Total operating revenue less cost of goods sold. The group has presented this item because it considers it to be a useful measure to show the management's view on the overall picture of profit generation before operating costs in the group's operations.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Total operating revenue | 3 618 | 2 606 | 14 618 |
| - Cost of goods sold | (3 108) | (2 298) | (12 824) |
| = Gross profit | 511 | 308 | 1 794 |
| Gross margin | 14.1 % | 11.8 % | 12.3% |
Net interest-bearing debt: Interest-bearing liabilities less cash and cash equivalents. The group has presented this item because the management considers it to be a useful indicator of the group's indebtedness, financial flexibility and capital structure. The net interest-bearing debt incl. IFRS 16 is a useful measure as indebtedness, including the lease liabilities from IFRS 16, is relevant for the covenants of the group's credit facilities.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Long-term loans | 1 255 | 400 | 400 |
| + Short-term loans | 56 | 407 | 625 |
| - Cash/cash equivalents | (485) | (23) | (149) |
| = Net interest-bearing debt | 826 | 784 | 876 |
| + IFRS 16 liabilities | 612 | 334 | 558 |
| = Net Int.Bear. Debt incl IFRS 16 | 1 438 | 1 118 | 1 434 |
CONTENTS
HIGHLIGHTS KEY FIGURES CEO COMMENTS FINANCIAL REVIEW SEGMENT REVIEW FINANCIAL STATEMENTS AND NOTES APPENDIX
Net working capital: Working capital assets, comprising inventories plus total current receivables less trade receivables from deferred payment arrangements less current lease receivables, less working capital liabilities, comprising total current liabilities less current lease liabilities less bank overdraft. The management considers it to be a useful indicator of the group's capital efficiency in its day-to-day operational activities.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Inventories | 2 129 | 1 083 | 1 928 |
| + Total current receivables | 712 | 1 079 | 968 |
| - Deferred payment | (105) | (112) | (91) |
| - Current lease receivables | - | (12) | - |
| - Total current liabilities | (2 433) | (1 690) | (2 953) |
| + Current lease liabilities | 191 | 87 | 167 |
| + Short-term loans | 56 | 407 | 625 |
| = Net Working Capital | 551 | 841 | 644 |
Operating cost percentage (adj.): Total operating expenses less cost of goods sold and one-off cost as a percentage of total operating revenue. The group has presented this item because the management considers it to be a useful measure of the group's efficiency in operating activities.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| Total operating revenue | 3 618 | 2 606 | 14 618 |
| Total operating expenses | 3 623 | 2 587 | 14 612 |
| - Cost of goods sold | (3 108) | (2 298) | (12 824) |
| - One-off cost | (13) | (18) | (80) |
| = Total operating expenses (adj.) | 502 | 271 | 1 707 |
| Operating Costs% | 13.9 % | 10.4 % | 11.7% |
Operating free cash flow: EBITDA excl. impact of IFRS16 less investment in property, plant and equipment, less change in net working capital less change in trade receivable from deferred payment arrangements. The group has presented this item because the management considers it to be a useful measure of the group's operating activities' cash generation.
Reconciliation
| Amounts in NOK million | Q1 2023 | Q1 2022 | FY 2022 |
|---|---|---|---|
| EBITDA excl IFRS 16 | 27 | 32 | 109 |
| - Investments | (49) | (30) | (177) |
| +/- Change in net working capital | 94 | (222) | 750 |
| +/- Change in deferred payment | (14) | 17 | 39 |
| = Operating free cash flow | 57 | (204) | 721 |
CONTENTS Komplett ASA
HIGHLIGHTS KEY FIGURES CEO COMMENTS Visitor address: Østre Kullerød 4 NO-3241 Sandefjord Norway
FINANCIAL REVIEW SEGMENT REVIEW Postal address:
FINANCIAL STATEMENTS AND NOTES APPENDIX P.O. Box 2094 NO-3202 Sandefjord Norway
T: +47 33 00 50 00 E: [email protected]
www.komplettgroup.com