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Munters Group — Interim / Quarterly Report 2010
Apr 22, 2010
2945_10-q_2010-04-22_9ba5dcf0-f625-42fe-bf5c-efafe7c024a3.pdf
Interim / Quarterly Report
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Q1
Interim report First quarter, January - March 2010
Positive signs in an uncertain market
- Order intake amounted to SEK 1,543 M (1,724), down 2% adjusted1
- Net sales amounted to SEK 1,409 M (1,703), down 9% adjusted1
- EBIT before nonrecurring items amounted to SEK 68 M (39), up 66% adjusted1. The main reasons for the improvement were higher gross margins in the product divisions and a reduction in overhead costs in all divisions.
- Nonrecurring items totaled SEK 0 M (expense: 33)
- Operating cash flow improved and amounted to SEK 52 M (neg: 13)
- Net earnings after tax totaled SEK 37 M (loss: 22)
- Earnings per share amounted to SEK 0.50 (loss: 0.29)
| 2010 | 2009 | Change | Adjusted change 1 |
|
|---|---|---|---|---|
| Order intake, SEK M | 1,543 | 1,724 | -11% | -2% |
| Net sales, SEK M | 1,409 | 1,703 | -17% | -9% |
| EBIT before nonrecurring items, SEK M |
68 | 39 | 73% | 66% |
| EBIT, SEK M | 68 | 6 | 1033% | |
| EBIT margin, percent | 4.8 | 0.4 | 1100% | |
| Net earnings, SEK M | 37 | -22 | - | |
| Earnings per share, SEK | 0.50 | -0.29 | - |
Pro forma, adjusted for currency fluctuations, acquisitions and divestments 1
Comments by President and CEO Lars Engström
"It is gratifying to note that the order intake has stabilized and to see that growth was achieved in two key areas for the future development of Munters, namely commercial dehumidification and AgHort.
We delivered another quarter of improved gross margins in our product divisions and overhead costs were reduced in all divisions. Accordingly, every division reported higher operating profit compared with the year-earlier period.
The trend in MCS's gross margin was positive in Europe and the cold and snowy winter in northern Europe had a positive impact in the first quarter. Parts of this backlog remain to be invoiced now that MCS is entering its seasonally weakest quarter. During the quarter, we decided to close the MCS operations in Australia. The closure will take place in the second quarter.
Looking ahead, we can see that considerable uncertainty remains regarding market trends. This implies that the focus on the internal conditions, such as costs, productivity and capital employed remains."
Munters is a global leader in energy-efficient air-treatment solutions and restoration services based on expertise in humidity and climate control technologies. Customers are served in a wide range of segments, the most important being the insurance, food and pharma industries. Manufacturing and sales are carried out through the Group's own companies in more than 30 countries. The Group has close to 4 000 employees and net sales of about SEK 6.5 billion. The Munters share is listed on the Nasdaq OMX Stockholm, Mid Cap.
For more information, www.munters.com.
President and CEO Lars Engström
Phone +46 8 626 63 03 [email protected]
Phone +46 8 626 63 06 [email protected]
Martin Lindqvist
CFO
Address Munters AB (publ) Isafjordsg1, Kista Entré P.O. Box 1188 S-164 26 Kista Sweden
First quarter
Order intake
During the first quarter, the Group's order intake declined to SEK 1,543 M (1,724), down 2% adjusted1.
For the second consecutive quarter, unchanged demand was noted in the Dehumidification Division. The US operation experienced an organic decline of 4%, due to a continued economic downturn affecting the industrial segment in the US.
In the HumiCool Division, growth remained favorable in the AgHort segment, while HVAC and Mist Elimination continued to decline.
The order backlog fell 18% compared with the yearearlier period, and was SEK 1,158 M (1,418) at the end of the quarter, equal to a decline of 10% adjusted1.
Net sales
Consolidated net sales declined to SEK 1,409 M (1,703), down 9% adjusted1. A stronger SEK compared with the year-earlier period had an inverse impact of 8% on SEK-denominated net sales.
1Pro forma, adjusted for currency effects, acquisitions and divestments
Earnings
Consolidated EBIT amounted to SEK 68 M (6), representing an operating margin of 4.8% (0.4).
Despite an organic sales decline of 9%, the profitability improved in the Group. The improvement was attributable to increased gross margins in Dehumidification and HumiCool, and to a reduction in overhead costs in all divisions.
Profitability was adversely affected by MCS Australia. During the quarter, a decision was taken to close this operation. The closure will be completed during the second quarter.
During the first quarter, consolidated earnings after financial items totaled SEK 62 M (loss: 16). Net earnings amounted to SEK 37 M (loss: 22). Earnings per share were SEK 0.50 (loss: 0.29).
Cash flow
Operating cash flow totaled SEK 52 M (neg: 13). The improved earnings and low investment contributed positively to cash flow for the period.
Second-quarter prospects
Gradual stabilization and recovery is expected in parts of Dehumidification and HumiCool. Within MCS, invoicing to customers for damage-restoration projects related to cold weather is expected to provide a somewhat favorable impact on earnings during the seasonally weakest quarter. MCS Australia will be closed during the second quarter. Combined, the cost of the closure and the operating loss for MCS Australia for the second quarter are expected to total about SEK 25 M.
Consolidated Order intake 2000 – 2010 Consolidated Net sales
and EBIT 2000 – 2010
2004 and later in accordance with IFRS
Investments
Group investments in tangible assets during the quarter totaled SEK 14 M (38), of which SEK 5 M (20) pertained to investments in equipment in the MCS Division. Depreciation and amortization totaled SEK 40 M (46).
Financial position
The equity ratio at the end of the quarter rose to more than 38% (35 at the beginning of the year). Interestbearing assets totaled SEK 401 M (460 at the beginning of the year), with interest-bearing provisions and liabilities totaling SEK 1,162 M (1,309 at the beginning of the year). Net debt during the quarter declined SEK 88 M to SEK 761 M.
The Group has unutilized loan facilities of SEK 1,284 M. Munters' bank borrowings consist of a syndicated credit facility and bank loans granted to subsidiaries on an individual basis. During the quarter, the syndicated loan was amortized by SEK 98 M. The syndicated loan facility totals SEK 2,000 M and extends to 2012.
Personnel
The workforce at the end of the period corresponded to 3,778 permanent employees, which was 44 employees fewer than at year-end and 294 employees (7%) fewer than March 31, 2009.
Divisional performance
Dehumidification division
The Dehumidification Division has a function-based organization divided into three market areas: Americas, Europe and Asia & Pacific.
| First quarter | |||
|---|---|---|---|
| Amounts in SEK M | 2010 | 2009 | |
| Order intake | 542 | 596 | |
| Change | -9% | ||
| Adjusted change1 | 1% | ||
| Net sales | 452 | 588 | |
| Change | -23% | ||
| Adjusted change1 | -14% | ||
| EBITA ex. one-time items |
32 | 26 | |
| Adjusted margin | 7.1% | 4.4% | |
| EBITA | 32 | 14 | |
| EBITA margin | 7.1% | 2.4% |
- Continued stabilization in Europe
- Lower order intake from industrial segment in the US
- Increased profitability due to improved operating margin and reduced overhead costs
- Strong cash flow
First quarter
Just as in the fourth quarter of 2009, order intake in relation to the year-earlier period was unchanged for the division's European operations. However, the US operations experienced an organic decline of 4%, attributable to the industrial segment. Favourable order growth was noted by the commercial segment of the US market and the division's Asian operations.
Sales declined 14% organically due to order situation. The downturn was also due to a higher proportion of major projects with protracted lead times.
Profitability improved despite the volume downturn. Gross margins improved, mainly as a result of productivity gains in the plants, in addition to price increases and reduced warranty costs.
Cash flow was strong in the division, primarily because of a reduction in accounts receivable.
1Pro forma, adjusted for currency effects, acquisitions and divestments.
Second-quarter prospects
Stable demand is expected in the European and Asian markets. Considerable uncertainty prevails concerning US demand. Due to the mix, a decline in the gross margin is expected, since the commercial segment will increase its weight of total sales.
HumiCool division
HumiCool division is divided into three business areas: AgHort, Mist Elimination and HVAC (incl. PreCooler).
| First quarter | |||
|---|---|---|---|
| Amounts in SEK M | 2010 | 2009 | |
| Order intake | 333 | 413 | |
| Change | -19% | ||
| Adjusted change1 | -11% | ||
| Net sales | 323 | 389 | |
| Change | -17% | ||
| Adjusted change1 | -9% | ||
| EBITA ex. one-time items |
22 | 5 | |
| Adjusted margin | 6.9% | 1.3% | |
| EBITA | 22 | -11 | |
| EBITA margin | 6.9% | -2.8% |
- Positive order growth in AgHort and HVAC products
- Sharp decline in order intake and sales for HVAC systems (PreCooler)
- Continued decline at Mist Elimination
- Improved margins and reduction in overhead costs
First quarter
Order intake increased for the second consecutive quarter in AgHort and HVAC products but declined sharply for HVAC systems (PreCooler), for which the market activities were low and the comparative period was very strong. Mist Elimination also noted a reduction in orders.
Positive signs are shown in the European and Asian AgHort markets, while the US market remained weak. The trend for HVAC, excluding PreCooler, was positive as a result of the cold winter in Europe.
Sales increased in all segments apart from PreCooler, which individually accounted for the entire sales decline in the division.
The division's earnings improved, with increases in gross margins in all segments. The factors underlying the improved margin were increased productivity and an
advantageous product mix. A reduction in overhead costs also contributed to the increased earnings.
Cash flow was weak during the quarter, due largely to lower amounts for advance payments from customers and accounts payable.
Second quarter prospects
A certain recovery from a low level is expected in parts of AgHort and HVAC, while the market outlook for PreCooler and Mist Elimination are very unsure. During the second quarter the delivery lavel for PreCooler will be very low. The review of the division plant structure will continue.
Moisture Control Services (MCS) division
Division MCS has a country-based organization divided into three market areas: Northern Europe, Central Europe and the US & Asia.
| First quarter | |||
|---|---|---|---|
| Amounts in SEK M | 2010 | 2009 | |
| Order intake | 683 | 722 | |
| Change | -6% | ||
| Adjusted change1 | 2% | ||
| Net sales | 638 | 736 | |
| Change | -13% | ||
| Adjusted change1 | -6% | ||
| EBITA ex. one-time items |
27 | 17 | |
| Adjusted margin | 4.3% | 2.3% | |
| EBITA | 27 | 12 | |
| EBITA margin | 4.3% | 1.6% |
- The cold winter contributed to an increase in order intake in Northern Europe
- Sales were adversely affected by MCS Australian and the low level of activity in the US market
- Stable gross margin and reduction in overhead costs
- Decision to close MCS Australia
First quarter
The cold winter contributed to an increase in order intake, particularly in Northern Europe. The American operations showed negative growth due to a generally low level of activity in the market.
Despite a high order intake, sales declined 6% organically. MCS Australia accounted for half of the downturn. The remainder was due to the American market and the fact that projects related to cold weather usually have longer lead times than normal water damage.
The gross margin was stable compared to the year-earlier period. Lower fixed costs offset the negative sales trend.
Order intake, sales and profitability were affected negatively by MCS Australia. It was decided during the quarter that this unit would be closed during the second quarter. The division's operating margin, excluding MCS Australia, was 5.4% during the quarter.
Introduction of the division's new business model proceeded as planned and an additional 8 depots were closed during the quarter.
Cash flow during the quarter was weak due to increased work in progress and a decrease in outstanding accounts payable.
Second quarter prospects
Seasonally, the second quarter is usually the weakest period within MCS. This is expected to also apply in 2010. The announced discontinuation of MCS Australia will have an adverse impact of about SEK 25 million on earnings, including operating losses. Due to the slightly longer lead times for claims projects related to cold weather, a certain part of the order backlog, primarily in Scandinavia, will be invoiced during the second quarter.
1Pro forma, adjusted for currency effects, acquisitions and divestments
SIGNIFICANT RISKS AND UNCERTAINTIES
Munters' exposure to risk can be divided primarily into two categories - operational risks and financial risks. Operational risks are dependent on weather, key personnel and key customers, and geographically dispersed operations involving small operational units. Financial risks consist mainly of currency, interest and financing risks.
Demand for the company's products is affected by general economic trends. The recession has result in lower sales, thereby also reducing capacity utilization in manufacturing in the short term. The continuing trend in the global economy, including interest-rate and currency risks, represents an uncertainty factor concerning the earnings trend. Munters' previous acquisition frequency may result in integration-related risks.
A more detailed description of the Group's and Parent Company's other risk exposure and risk management activities is available in the "Risks and risk management" section on page 25, and in Note 3, of the Munters Annual Report for 2009 which is available at www.munters.com.
FORWARD-LOOKING STATEMENTS
Some statements in this report are forward looking, and the actual outcomes may be materially different. In addition to the factors explicitly discussed, other factors could have a material impact on actual outcomes, such as general business conditions, fluctuations in exchange rates and interest rates, political risks, the impact of competing products and their pricing, product development, commercial and technological difficulties, interruptions in supply and major customer-related bad debts.
TRANSACTIONS WITH RELATED PARTIES
There are no significant contractual relationships or transactions between Munters and its related parties, apart from the remuneration of senior executives.
PARENT COMPANY
The Parent Company reported profit of SEK 22 M (loss: 2) after financial items during the quarter. There were no external net sales (as in 2009). Cash and cash equivalents at the close of the quarter amounted to SEK 104 M (148 at the beginning of the year) and net debt to SEK 881 M (981 at the beginning of the year). Capital expenditure totaled SEK 0 M (1). The average number of employees at the close of the quarter was 31 (33).
FUTURE INFORMATION DATES
July 22 Interim report, January – June 2010 October 27 Interim report, January – September 2010
PRESS AND ANALYST CONFERENCE
Munters will hold a presentation, audiocast and teleconference for the media, analysts and investors on Thursday, April 22, from 4 to 4:45 pm at Ingenjörshuset, Malmskillnadsgatan 46, Stockholm.
The link to the audiocast is www.munters.com/ Investors/Calendar
Phone: Sweden +46 8 5051 3643 UK +44 20 7806 1967
Code: 3519411
AUDITORS' EXAMINATION REPORT
The auditors have not examined this interim report.
Kista, April 22, 2010
Lars Engström President and Chief Executive Officer Member of the Board
Munters discloses the information provided herein pursuant to the Securities Markets Act and/or the Financial Instruments Trading Act. The information was submitted for publication on April 22, 2010 at 2 pm (CET).
| 2010 | 2009 | 2009/2010 | 2009 | |
|---|---|---|---|---|
| Jan-Mar | Jan-Mar | Apr-Mar | Jan-Dec | |
| Amounts in SEK M | 3 months | 3 months | 12 months | 12 months |
| Order intake | 1,543 | 1,724 | 6,082 | 6,263 |
| Statement of comprehensive income | ||||
| Net sales | 1,409 | 1,703 | 6,230 | 6,524 |
| Cost of goods sold | -1,033 | -1,317 | -4,546 | -4,830 |
| Gross earnings | 376 | 386 | 1,684 | 1,694 |
| Gross margin | 26.7% | 22.7% | 27.0% | 26.0% |
| Other operating income | 0 | 5 | -3 | 2 |
| Selling expenses | -157 | -205 | -663 | -711 |
| Administrative expenses | -127 | -156 | -554 | -583 |
| Research and development costs | -21 | -24 | -80 | -83 |
| Other operating expenses | -3 | 0 | -11 | -8 |
| EBIT - Earnings before interest and tax | 68 | 6 | 373 | 311 |
| EBIT margin | 4.8% | 0.4% | 6.0% | 4.8% |
| Financial income and expenses | -6 | -22 | -49 | -65 |
| Earnings after financial incom e | 62 | -16 | 324 | 246 |
| Taxes | -25 | -6 | -130 | -111 |
| Net earnings | 37 | -22 | 194 | 135 |
| Other com prehensive incom e | ||||
| Actuarial gains and losses on defined benefit pension plans | 1 | 0 | 15 | 14 |
| Cash flow hedges | 0 | 2 | -1 | 1 |
| Exchange differences on translating foreign operations | -29 | 53 | -105 | -23 |
| Income tax relating to components of other comprehensive | 0 | -1 | -3 | - 4 |
| income Other com prehensive incom e for the period, net of tax |
-28 | 54 | -94 | -12 |
| Total com prehensive incom e for the period | 9 | 32 | 100 | 123 |
| Net earnings | ||||
| Attributable to equity holders of the parent | 37 | -22 | 193 | 134 |
| Attributable to minority interest | 0 | 0 | 1 | 1 |
| 37 | -22 | 194 | 135 | |
| Total com prehensive incom e | ||||
| Attributable to equity holders of the parent | 9 | 32 | 99 | 122 |
| Attributable to minority interest | 0 | 0 | 1 | 1 |
| 9 | 32 | 100 | 123 | |
| Earnings per share1 | ||||
| Earnings per share, SEK | 0.50 | -0.29 | 2.60 | 1.81 |
| Earnings per share - after dilution, SEK | 0.50 | -0.29 | 2.60 | 1.81 |
1 Earnings per share, before and after dilution, is based on net earnings attributable to equity holders of the parent
| Segment information | 2010 | 2009 | 2009/2010 | 2009 |
|---|---|---|---|---|
| Jan-Mar | Jan-Mar | Apr-Mar | Jan-Dec | |
| Amounts in SEK M | 3 months | 3 months | 12 months | 12 months |
| Order intake by division | ||||
| Dehumidification division | 542 | 596 | 2,180 | 2,234 |
| HumiCool division | 333 | 413 | 1,290 | 1,370 |
| MCS division | 683 | 722 | 2,642 | 2,681 |
| Eliminations | -15 | -7 | -30 | -22 |
| Order intake | 1,543 | 1,724 | 6,082 | 6,263 |
| Net sales by division | ||||
| Dehumidification division | 452 | 588 | 2,164 | 2,300 |
| HumiCool division | 323 | 389 | 1,417 | 1,483 |
| MCS division | 638 | 736 | 2,670 | 2,768 |
| Eliminations | -4 | -10 | -21 | -27 |
| Net sales | 1,409 | 1,703 | 6,230 | 6,524 |
| Operating earnings by division | ||||
| Dehumidification division | 32 | 14 | 269 | 251 |
| operating margin | 7.1% | 2.4% | 12.4% | 10.9% |
| HumiCool division | 22 | -11 | 104 | 71 |
| operating margin | 6.9% | -2.8% | 7.3% | 4.8% |
| MCS division | 27 | 12 | 62 | 47 |
| operating margin | 4.3% | 1.6% | 2.4% | 1.7% |
| Central, eliminations etc. | -10 | -6 | -48 | -44 |
| EBIT before amortizations, interest and tax | 71 | 9 | 387 | 325 |
| Amortizations on acquisition related intangible assets | -3 | -3 | -14 | -14 |
| EBIT - Earnings before interest and tax | 68 | 6 | 373 | 311 |
| Dehumidification | HumiCool | MCS | Central, elim | Total | |
|---|---|---|---|---|---|
| Earnings by segment | 2010 | 2010 | 2010 | 2010 | 2010 |
| Jan-Mar | Jan-Mar | Jan-Mar | Jan-Mar | Jan-Mar | |
| Amounts in SEK M | 3 months | 3 months | 3 months | 3 months | 3 months |
| External net sales | 449 | 323 | 637 | 1,409 | |
| Internal net sales | 3 | 0 | 1 | -4 | 0 |
| Net sales | 452 | 323 | 638 | -4 | 1,409 |
| Operating earnings | 32 | 22 | 27 | 2 | 83 |
| Amortization of surplus values | -2 | -1 | -3 | ||
| Undistributed costs | -12 | -12 | |||
| EBIT - Earnings before interest and tax | 30 | 21 | 27 | -10 | 68 |
| Financial items, net | -6 | ||||
| Taxes | -25 | ||||
| Net earnings | 37 | ||||
| Dehumidification | HumiCool | MCS | Central, elim | Total | |
| 2009 | 2009 | 2009 | 2009 | 2009 | |
| Jan-Mar | Jan-Mar | Jan-Mar | Jan-Mar | Jan-Mar | |
| Amounts in SEK M | 3 months | 3 months | 3 months | 3 months | 3 months |
| External net sales | 579 | 388 | 736 | 1,703 | |
| Internal net sales | 9 | 1 | 0 | -10 | 0 |
| Net sales | 588 | 389 | 736 | -10 | 1,703 |
| Operating earnings | 14 | -11 | 12 | 2 | 17 |
| Amortization of surplus values | -2 | -1 | -3 | ||
| Undistributed costs | -8 | -8 | |||
| EBIT - Earnings before interest and tax | 12 | -12 | 12 | -6 | 6 |
| Financial items, net | -22 | ||||
| Taxes | -6 | ||||
| Net earnings | -22 |
| Statement of financial position | 2010 | 2009 | 2009 |
|---|---|---|---|
| Amounts in SEK M | 31 Mar | 31 Dec | 31 Mar |
| ASSETS | |||
| Fixed assets | |||
| Tangible assets | |||
| Buildings and land | 191 | 197 | 218 |
| Plant and machinery | 109 | 116 | 151 |
| Equipment, tools, fixtures and fittings | 227 | 241 | 299 |
| Construction in progress | 8 | 15 | 20 |
| 535 | 569 | 688 | |
| Intangible assets | |||
| Patent, trademarks and similar rights | 120 | 127 | 143 |
| Goodwill | 890 | 926 | 1,006 |
| 1,010 | 1,053 | 1,149 | |
| Other fixed assets | |||
| Participation in associated companies | 0 | 0 | 2 |
| Other long-term receivables | 22 | 28 | 26 |
| Deferred tax assets | 142 | 148 | 154 |
| 164 | 176 | 182 | |
| 1,709 | 1,798 | 2,019 | |
| Current assets | |||
| Inventory etc. | 471 | 427 | 617 |
| Accounts receivable | 939 | 1,051 | 1,248 |
| Other receivables | 221 | 235 | 269 |
| Cash and cash equivalents | 401 | 458 | 352 |
| 2,032 | 2,171 | 2,486 | |
| TOTAL ASSETS | 3,741 | 3,969 | 4,505 |
| EQUITY AND LIABILITIES | |||
| 1,415 | 1,407 | 1,317 | |
| Equity | |||
| Long-term liabilities | |||
| Interest-bearing liabilities | 953 | 1,100 | 1,580 |
| Provisions | 192 | 205 | 222 |
| Deferred tax liabilities | 79 | 81 | 95 |
| Other liabilities | 0 | 1 | 11 |
| 1,224 | 1,387 | 1,908 | |
| Current liabilities | |||
| Interest-bearing liabilities | 32 | 31 | 6 |
| Advances from customers | 62 | 66 | 85 |
| Accounts payable | 421 | 479 | 507 |
| Provisions | 83 | 81 | 78 |
| Other liabilities | 504 | 518 | 604 |
| 1,102 | 1,175 | 1,280 | |
| TOTAL EQUITY AND LIABILITIES | 3,741 | 3,969 | 4,505 |
| Statement of changes in equity | ||||||
|---|---|---|---|---|---|---|
| Translation of Total equity |
||||||
| Share | foreign | Retained | attributable to equity | Minority | ||
| capital | operations | earnings | holders of the parent | interest | Total equity | |
| Balance at 1 January 2009 | 131 | 99 | 1,048 | 1,278 | 7 | 1,285 |
| Changes in equity 2009 | ||||||
| Dividend | -1 | -1 | ||||
| Total comprehensive income for the year | -23 | 145 | 122 | 1 | 123 | |
| Balance at 31 December 2009 | 131 | 76 | 1,193 | 1,400 | 7 | 1,407 |
| Changes in equity 2010 | ||||||
| Dividend | -1 | -1 | ||||
| Total comprehensive income for the year | -29 | 38 | 9 | 0 | 9 | |
| Balance at 31 March 2010 | 131 | 47 | 1,231 | 1,409 | 6 | 1,415 |
| Statement of cash flows | 2010 | 2009 | 2009/2010 | 2009 |
|---|---|---|---|---|
| Jan-Mar | Jan-Mar | Apr-Mar | Jan-Dec | |
| Amounts in SEK M | 3 months | 3 months | 12 months | 12 months |
| Operating activities | ||||
| Earnings after financial items | 62 | -16 | 324 | 246 |
| Reversal of depreciation etc. | 40 | 46 | 182 | 188 |
| Other earnings not affecting cash flow | 1 | -4 | 6 | 1 |
| Taxes paid | -25 | -26 | -180 | -181 |
| Cash flow from operating activities | ||||
| before changes in w orking capital | 78 | 0 | 332 | 254 |
| Cash flow from changes in w orking capital | ||||
| Changes in inventory | -52 | -8 | 107 | 151 |
| Changes in accounts receivable | 82 | 150 | 206 | 274 |
| Changes in other receivables | 12 | -35 | 50 | 3 |
| Changes in accounts payable | -45 | -45 | -42 | -42 |
| Changes in other liabilities | -10 | -36 | -57 | -83 |
| Sum of changes in w orking capital | -13 | 26 | 264 | 303 |
| Cash flow from operating activities | 65 | 26 | 596 | 557 |
| Investing activities | ||||
| Acquisitions and divestments of businesses | - | -3 | 1 | -2 |
| Investments in intangible assets | -1 | -2 | -6 | -7 |
| Investments in tangible assets | -14 | -38 | -73 | -97 |
| Sales of tangible assets | 1 | 0 | 8 | 7 |
| Change in other financial assets | 1 | 1 | 1 | 1 |
| Cash flow from investing activities | -13 | -42 | -69 | -98 |
| Financing activities | ||||
| Changes in loans | -98 | -130 | -454 | -486 |
| Dividend paid | -1 | - | -2 | -1 |
| Cash flow from financing activities | -99 | -130 | -456 | -487 |
| Cash flow for the period | -47 | -146 | 71 | -28 |
| Cash and cash equivalents at beginning of period | 458 | 490 | 458 | 490 |
| Exchange-differences in cash and cash equivalents | -10 | 8 | -22 | -4 |
| Cash and cash equivalents at end of period | 401 | 352 | 507 | 458 |
| Operating cash flow | 52 | -13 | 526 | 461 |
| Key figures | ||||
| More key figures are disclosed in the quarterly review | ||||
| Capital turnover rate, times (4 quarters) | - | - | 2.2 | 2.2 |
| Return on capital employed, % | 2.7 | 0.1 | 13.1 | 10.4 |
| Return on equity, % | 2.6 | -1.7 | 10.2 | 6.0 |
| Return on total capital, % (4 quarters) | - | - | 9.0 | 7.1 |
| Interest coverage ratio, times | 9.5 | 0.2 | 8.3 | 5.3 |
| Net debt structure | ||||
| Short-term interest-bearing liabilities | - | - | 32 | 31 |
| Long-term interest-bearing liabilities | - | - | 953 | 1,100 |
| Defined benefit pension plans | - | - | 177 | 178 |
| Interest-bearing liabilities | - | - | -401 | -460 |
| Net debt | - | - | 761 | 849 |
Quarterly overview - Consolidated earnings, share data and cash flow
| 2010 | 2009 | 2008 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Amounts in SEK M | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Order intake | 1,543 | 1,383 | 1,440 | 1,716 | 1,724 | 1,661 | 1,582 | 1,686 | 1,586 |
| Income statement | |||||||||
| Net sales | 1,409 | 1,594 | 1,533 | 1,694 | 1,703 | 1,881 | 1,597 | 1,548 | 1,545 |
| Operating expenses | -1,341 | -1,455 | -1,429 | -1,632 | -1,697 | -1,805 | -1,515 | -1,453 | -1,437 |
| EBIT | 68 | 139 | 104 | 62 | 6 | 76 | 82 | 95 | 108 |
| EBIT margin | 4.8% | 8.7% | 6.8% | 3.7% | 0.4% | 4.0% | 5.1% | 6.1% | 7.0% |
| Financial income and expense | -6 | -6 | -17 | -20 | -22 | -21 | -20 | -18 | -17 |
| Earnings after financial item s | 62 | 133 | 87 | 42 | -16 | 55 | 62 | 77 | 91 |
| Taxes | -25 | -39 | -51 | -15 | -6 | -37 | -22 | -28 | -33 |
| Net earnings | 37 | 94 | 36 | 27 | -22 | 18 | 40 | 49 | 58 |
| Depreciations and amortizations | 40 | 49 | 46 | 47 | 46 | 47 | 39 | 38 | 43 |
| Share data | |||||||||
| Earnings per share, SEK | 0.50 | 1.27 | 0.47 | 0.36 | -0.29 | 0.24 | 0.53 | 0.66 | 0.78 |
| Earnings per share after dilution, SEK | 0.50 | 1.27 | 0.47 | 0.36 | -0.29 | 0.24 | 0.53 | 0.66 | 0.78 |
| Average no of shares outstanding, thousand | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 |
| No of shares outstanding at period-end, thousand | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 | 73,933 |
| Number of treasury shares, thousand | 1,067 | 1,067 | 1,067 | 1,067 | 1,067 | 1,067 | 1,067 | 1,067 | 1,067 |
| Equity per share, SEK | 19.06 | 18.94 | 17.13 | 17.71 | 17.72 | 17.28 | 15.99 | 14.48 | 16.11 |
| Equity per share after dilution, SEK | 19.06 | 18.94 | 17.13 | 17.71 | 17.72 | 17.28 | 15.99 | 14.48 | 16.11 |
| Stock price at period-end, SEK | 52.00 | 46.60 | 50.00 | 37.20 | 23.50 | 38.40 | 48.50 | 57.25 | 68.50 |
| Market cap at period-end, SEK M1 | 3,900 | 3,495 | 3,750 | 2,790 | 1,763 | 2,880 | 3,638 | 4,294 | 5,138 |
| Statement of cash flows | |||||||||
| From operating activities | 65 | 216 | 77 | 238 | 26 | 193 | 80 | 55 | 0 |
| From investing activities | -13 | -11 | -12 | -33 | -42 | -93 | -36 | -63 | -43 |
| From financing activities | -99 | -155 | -65 | -137 | -130 | 112 | -48 | 7 | 16 |
| Cash flow for the period | -47 | 50 | 0 | 68 | -146 | 212 | -4 | -1 | -27 |
| Operating cash flow | 52 | 207 | 65 | 202 | -13 | 158 | 49 | 13 | -43 |
1 The market cap is calculated on total number of shares, including treasury shares
Quarterly overview - Consolidated financial position and key figures
| Statement of financial position | 2010 | 2009 | 2008 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Amounts in SEK M | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |
| ASSETS | ||||||||||
| Fixed assets | ||||||||||
| Tangible assets | 535 | 569 | 590 | 658 | 688 | 664 | 619 | 592 | 577 | |
| Intangible assets | 1,010 | 1,053 | 1,044 | 1,114 | 1,149 | 1,120 | 965 | 911 | 876 | |
| Other fixed assets | 164 | 176 | 181 | 191 | 182 | 149 | 115 | 107 | 107 | |
| 1,709 | 1,798 | 1,815 | 1,963 | 2,019 | 1,933 | 1,699 | 1,610 | 1,560 | ||
| Current assets | ||||||||||
| Inventory etc. | 471 | 427 | 518 | 569 | 617 | 589 | 668 | 622 | 577 | |
| Accounts receivable | 939 | 1,051 | 1,011 | 1,080 | 1,248 | 1,354 | 1,174 | 1,182 | 1,197 | |
| Other receivables | 221 | 235 | 226 | 255 | 269 | 248 | 231 | 192 | 179 | |
| Cash and cash equivalent | 401 | 458 | 369 | 367 | 352 | 490 | 251 | 242 | 242 | |
| 2,032 | 2,171 | 2,124 | 2,271 | 2,486 | 2,681 | 2,324 | 2,238 | 2,195 | ||
| TOTAL ASSETS | 3,741 | 3,969 | 3,939 | 4,234 | 4,505 | 4,614 | 4,023 | 3,848 | 3,755 | |
| EQUITY AND LIABILITIES | ||||||||||
| Equity | 1,415 | 1,407 | 1,273 | 1,316 | 1,317 | 1,285 | 1,188 | 1,076 | 1,198 | |
| Long-term liabilities | 271 | 287 | 293 | 304 | 328 | 308 | 245 | 240 | 239 | |
| Interest-bearing liabilities | 985 | 1,131 | 1,262 | 1,410 | 1,586 | 1,694 | 1,418 | 1,392 | 1,214 | |
| Accounts payable | 421 | 479 | 408 | 478 | 507 | 537 | 437 | 460 | 414 | |
| Other current liabilities | 649 | 665 | 703 | 726 | 767 | 790 | 735 | 680 | 690 | |
| TOTAL EQUITY AND LIABILITIES | 3,741 | 3,969 | 3,939 | 4,234 | 4,505 | 4,614 | 4,023 | 3,848 | 3,755 | |
| Key figures | ||||||||||
| Equity ratio, % | 37.8 | 35.4 | 32.3 | 31.1 | 29.2 | 27.8 | 29.5 | 28.0 | 31.8 | |
| Net debt, SEK M | 761 | 849 | 1,080 | 1,231 | 1,423 | 1,390 | 1,311 | 1,292 | 1,119 | |
| Net debt ratio, times | 0.5 | 0.6 | 0.9 | 0.9 | 1.1 | 1.1 | 1.1 | 1.2 | 0.9 | |
| Interest coverage ratio, times | 9.5 | 12.9 | 9.9 | 3.6 | 0.2 | 3.1 | 3.6 | 5.5 | 6.3 | |
| Investments in tangible assets, SEK M | 14 | 12 | 12 | 35 | 38 | 32 | 29 | 41 | 43 | |
| Number of permanent employees at period-end | 3,778 | 3,822 | 3,879 | 3,955 | 4,072 | 4,135 | 4,047 | 4,086 | 4,102 |
Definitions of the financial key figures can be found on page 73 in the Annual Report 2009.
Financial overview Group - 5 years
| 2010 | 2009 | 2008 | 2007 | 2006 | |
|---|---|---|---|---|---|
| Q1 | Q1 | Q1 | Q1 | Q1 | |
| Sales and earnings | |||||
| Net sales, SEK M | 1,409 | 1,703 | 1,545 | 1,404 | 1,386 |
| EBIT, SEK M | 68 | 6 | 108 | 127 | 118 |
| EBIT margin, % | 4.8 | 0.4 | 7.0 | 9.0 | 8.5 |
| Net earnings, SEK M | 37 | -22 | 58 | 78 | 71 |
| Earnings per share, SEK | 0.50 | -0.29 | 0.78 | 1.04 | 0.96 |
| Business and financial ratios | |||||
| Return on equity, % | 2.6 | -1.7 | 4.8 | 4.9 | 4.9 |
| Return on capital employed, % | 2.7 | 0.1 | 4.2 | 6.1 | 6.0 |
Quarterly overview - Divisions
| 2010 | 2009 | 2008 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Amounts in SEK M | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Order intake | |||||||||
| Dehumidification division | 542 | 499 | 503 | 636 | 596 | 608 | 511 | 528 | 487 |
| HumiCool division | 333 | 278 | 278 | 401 | 413 | 314 | 369 | 525 | 436 |
| MCS division | 683 | 607 | 665 | 687 | 722 | 745 | 710 | 643 | 672 |
| Eliminations | -15 | -1 | -6 | -8 | -7 | -6 | -8 | -10 | -9 |
| Order intake | 1,543 | 1,383 | 1,440 | 1,716 | 1,724 | 1,661 | 1,582 | 1,686 | 1,586 |
| Net sales | |||||||||
| Dehumidification division | 452 | 558 | 556 | 598 | 588 | 645 | 495 | 478 | 433 |
| HumiCool division | 323 | 349 | 324 | 421 | 389 | 435 | 425 | 433 | 451 |
| MCS division | 638 | 692 | 657 | 682 | 736 | 809 | 686 | 645 | 669 |
| Eliminations | -4 | -5 | -4 | -7 | -10 | -8 | -9 | -8 | -8 |
| Net sales | 1,409 | 1,594 | 1,533 | 1,694 | 1,703 | 1,881 | 1,597 | 1,548 | 1,545 |
| Operating earnings | |||||||||
| Dehumidification division | 32 | 106 | 65 | 66 | 14 | 75 | 48 | 45 | 33 |
| operating margin | 7.1% | 19.0% | 11.7% | 11.0% | 2.4% | 11.7% | 9.6% | 9.5% | 7.6% |
| HumiCool division | 22 | 31 | 20 | 31 | -11 | 23 | 36 | 44 | 51 |
| operating margin | 6.9% | 8.6% | 6.3% | 7.3% | -2.8% | 5.5% | 8.5% | 10.2% | 11.4% |
| MCS division | 27 | 21 | 32 | -18 | 12 | -9 | 7 | 14 | 36 |
| operating margin | 4.3% | 3.0% | 4.9% | -2.6% | 1.6% | -1.1% | 1.0% | 2.2% | 5.3% |
| Group overheads, eliminations etc. | -13 | -19 | -13 | -17 | -9 | -13 | -9 | -8 | -12 |
| Earnings before interest and tax | 68 | 139 | 104 | 62 | 6 | 76 | 82 | 95 | 108 |
| EBIT margin | 4.8% | 8.7% | 6.8% | 3.7% | 0.4% | 4.0% | 5.1% | 6.1% | 7.0% |
| Operating capital | |||||||||
| Dehumidification division - Assets | 672 | 716 | 721 | 798 | 883 | 855 | 703 | 675 | 649 |
| Dehumidification division - Liabilities | -222 | -213 | -225 | -260 | -267 | -265 | -179 | -195 | -173 |
| HumiCool division - Assets | 575 | 606 | 627 | 691 | 759 | 787 | 821 | 818 | 767 |
| HumiCool division - Liabilities | -146 | -180 | -157 | -179 | -178 | -206 | -239 | -251 | -225 |
| MCS division - Assets | 753 | 775 | 830 | 881 | 976 | 1,028 | 1,001 | 963 | 977 |
| MCS division - Liabilities | -121 | -153 | -110 | -128 | -151 | -174 | -121 | -107 | -106 |
| Central, eliminations | 71 | 79 | 73 | 80 | 82 | 79 | 59 | 52 | 65 |
| Operating capital | 1,582 | 1,630 | 1,759 | 1,883 | 2,104 | 2,104 | 2,045 | 1,955 | 1,954 |
| Permanent employees | |||||||||
| Dehumidification division | 1,197 | 1,198 | 1,214 | 1,238 | 1,293 | 1,301 | 1,173 | 1,196 | 1,184 |
| HumiCool division | 783 | 797 | 788 | 805 | 795 | 866 | 908 | 914 | 959 |
| MCS division | 1,773 | 1,805 | 1,854 | 1,889 | 1,959 | 1,944 | 1,942 | 1,952 | 1,938 |
| Central | 25 | 22 | 23 | 23 | 25 | 24 | 24 | 24 | 2 1 |
| Num ber of perm anent em ployees | 3,778 | 3,822 | 3,879 | 3,955 | 4,072 | 4,135 | 4,047 | 4,086 | 4,102 |
Operating capital consists of accounts receivable (external and internal), inventory, accounts payable, advances from customers and fixed assets excluding goodw ill.
MUNTERS AB
| Income statement | 2010 | 2009 | 2009/2010 | 2009 |
|---|---|---|---|---|
| Jan-Mar | Jan-Mar | Apr-M ar | Jan-Dec | |
| Amounts in SEK M | 3 months | 3 months | 12 months | 12 months |
| Net sales | 15 | 13 | 64 | 62 |
| Gross earnings | 15 | 13 | 64 | 62 |
| Other operating income | 0 | 0 | 2 | 2 |
| Selling expenses | 0 | 0 | 0 | 0 |
| Administrative expenses | -31 | -21 | -143 | -133 |
| Other operating expenses | 0 | 0 | 1 | 1 |
| EBIT - Earnings before interest and tax | -16 | -8 | -76 | -68 |
| Financial income and expenses | 38 | 6 | 58 | 26 |
| Earnings after financial item s | 22 | -2 | -18 | -42 |
| Transfer to tax allocation reserve | - | - | -3 | -3 |
| Income taxes | 1 | 0 | 14 | 13 |
| Net earnings | 23 | -2 | -7 | -32 |
Balance sheet
| 2010 | 2009 | 2009 | |
|---|---|---|---|
| Amounts in SEK M | 31 Mar | 31 Dec | 31 Mar |
| ASSETS | |||
| Fixed assets | |||
| Tangible assets | |||
| Equipment, tools, fixtures and fittings | 5 | 6 | 9 |
| 5 | 6 | 9 | |
| Intangible assets | |||
| Patent, licenses and similar rights | 17 | 18 | 18 |
| 17 | 18 | 18 | |
| Financial assets | |||
| Participations in subsidiaries | 904 | 904 | 800 |
| Receivables from subsidiaries | 1,120 | 1,247 | 1,744 |
| 2,024 | 2,151 | 2,544 | |
| 2,046 | 2,175 | 2,571 | |
| Current assets | |||
| Receivables from subsidiaries | 52 | 57 | 31 |
| Other receivables | 33 | 34 | 52 |
| Cash and cash equivalents | 104 | 148 | 88 |
| 189 | 239 | 171 | |
| TOTAL ASSETS | 2,235 | 2,414 | 2,742 |
| EQUITY AND LIABILITIES | |||
| Equity | 1,047 | 1,024 | 1,004 |
| Untaxed reserves | 22 | 22 | 19 |
| Long-term liabilities | |||
| Interest-bearing liabilities | 946 | 1,091 | 1,540 |
| Provisions | 39 | 39 | 39 |
| 985 | 1,130 | 1,579 | |
| Current liabilities | |||
| Liabilities to subsidiaries | 159 | 213 | 107 |
| Accounts payable | 3 | 2 | 7 |
| Other liabilities | 19 | 23 | 26 |
| 181 | 238 | 140 | |
| TOTAL EQUITY AND LIABILITIES | 2,235 | 2,414 | 2,742 |
Notes
Note 1. Accounting policies
In common with the annual accounts for 2009, the consolidated financial statements for the first quarter of 2010 were prepared in compliance with International Financial Reporting Standards (IFRS) as adopted by the EU and with the Swedish Annual Accounts Act. The Parent Company's financial statements were prepared in compliance with the Swedish Annual Accounts Act and with the Financial Reporting Council's recommendation RFR 2.3 Accounting for Legal Entities.
This quarterly report has been prepared in accordance with IAS 34. In this document, the term "IFRS" includes the application of both IAS and IFRS, and the interpretations of these standards published by the IASB's Standards Interpretation Committee (SIC) and its International Financial Reporting Interpretations Committee (IFRIC).
The Group uses the same accounting principles as described in its 2009 Annual Report. New and revised IFRSs that become effective after January 1, 2010 did not affect Munters' financial position or earnings.
This document is a translation of the Swedish version. In the event of any discrepancies between this translation and the Swedish version, the Swedish version shall prevail.