Solar - Interim / Quarterly Report 2018

No. 13 2018 Quarterly Report Q1 2018

No. 13 2018 Quarterly Report Q1 2018

LEI: 21380031XTLI9X5MTY92

Q1 revenue and EBITA were on par with our expectations. We reconfirm our 2018 outlook.

CEO Jens Andersen says: "We see business development within our strategic focus areas. We continue to make good progress in aligning our concepts across countries to expand our concept sales albeit this is a resource-consuming process. Furthermore, our intensified focus on the industry segment is paying off. We are attracting new industry customers and renewing agreements. With a Total Cost of Ownership mindset we will continue to approach our customers with cross-national solutions in order to identify individual solutions for optimising their businesses."


Financial highlights (DKK million)*	Q1 2018	Q1 2017	2017
Revenue	2,828	2,838	11,105
EBITA	66	67	295
Earnings before tax	99	145	126
Cash flow from operating activities	-39	-86	12
Financial ratios (%)
Organic growth adj. for number of working days	4.4	4.5	6.9
EBITA margin	2.3	2.4	2.7
Net working capital, period-end/revenue (LTM)	10.3	9.3	9.7
Net working capital, average/revenue (LTM)**	10.5	9.6	10.2
Gearing (NIBD/EBITDA), no. of times	1.8	1.2	1.4
Return on invested capital (ROIC)	3.9	10.1	3.8
* Due to the divestments of our Austrian and Belgian business activities, GFI GmbH and Claessen ELGB NV, 2017 and 2018 figures in this announcement relate to our continuing operations. ** Calculated as an average of the past four quarters' inventories, trade receivables and trade payables.

Q1 2018 Revenue

Adjusted organic growth amounted to 4.4% against 4.5% in Q1 2017. Related business saw growth of 28%, while growth in core business amounted to 3.5%.

Q1 2018 EBITA

The gross profit margin amounted to 20.7%, down from 21.4% in Q1 2017. The margin was negatively affected by a change in geographical mix amounting to approx. 0.2 percentage points.
Despite the growth, costs were down from DKK 524m to DKK 505m. However, approx. half of the decline can be ascribed to FX effect.
Compared to Q1 2017, EBITA from core business amounted to an unchanged DKK 74m. Related business diluted EBITA by DKK -8m in Q1 2018 against DKK -7m in Q1 2017.

2018 outlook

We expect revenue of approx. DKK 11.4bn corresponding to organic growth of approx. 4%. Within core business we expect growth of approx. 3%, which is on par with, or above, the expected market growth. Related business is expected to show growth of approx. 25%.
We expect EBITA of approx. DKK 345m, of which DKK 365m is expected from core business and DKK -20m from related business.


EBITA, DKK million	Core business	Related business	Solar Group
2017, actual, published 12.01.2018	309	-45	264
Divestment of Austrian and Belgian businesses	31	-	31
2017, actual continuing operations	340	-45	295
Overhead costs*	-10	-	-10
Planned improvements	35	25	60
2018 guidance	365	-20	345

*The Austrian and Belgian businesses carried approx. DKK 10m in overhead

costs, which will now be placed in the continuing operations within core business.

Audio webcast and teleconference today The presentation of Quarterly Report Q1 2018 will be conducted in English on 24 April 2018 at 11:00 CET. The presentation will be transmitted as an audio webcast and will be available at www.solar.eu. Participation will be possible via a teleconference.

Teleconference call-in numbers:

DK: tel. +45 354 455 83

UK: tel. +44 203 194 0544

US: tel. +1 855 269 2604

Yours faithfully,

Solar A/S

Jens Andersen

Contacts: CEO Jens Andersen - tel. +45 79 30 02 01

CFO Michael H. Jeppesen - tel. +45 79 30 02 62

Director, Stakeholder Relations Charlotte Risskov Kræfting - tel. +45 40 34 29 08

Enclosure: Quarterly Report Q1 2018, pages 1-27.

Facts about Solar Solar Group is a leading sourcing and services company. Our core business centres on product sourcing, value-adding services and optimisation of our customers' businesses.

Being a sourcing and services company, we focus on each individual customer. We always strive to understand our customers' unique and genuine needs in order to provide relevant, personal and value-adding services, turning our customers into winners.

Solar Group is headquartered in Denmark, generated revenue of more than DKK 11bn in 2017 and has approx. 3,000 employees. Solar is listed on Nasdaq Copenhagen and operates under the short designation SOLAR B. For more information, please visit www.solar.eu.

Disclaimer This announcement was published in Danish and English today via Nasdaq Copenhagen. In the event of any inconsistency between the two versions, the Danish version shall prevail.

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