Nobia: Continued margin improvements
Published 13 February 2013
Net sales for the fourth quarter amounted to SEK 3,097 million (3,239). Organic growth was a negative 2 per cent (neg: 10). Operating profit excluding net restructuring costs of SEK 739 million (189) amounted to SEK 196 million (80), corresponding to an operating margin of 6.3 per cent (2.5). Operating profit for the period was impacted by goodwill impairment of SEK 492 million pertaining to Hygena. In this interim report, this impairment has been added to restructuring costs for the quarter under the heading "Restructuring costs." Loss after tax including restructuring costs and impairment of deferred tax assets was SEK 675 million (loss: 90), corresponding to a loss per share of SEK 4.04 (loss: 0.53). The Board of Directors proposes a dividend of SEK 0.50 per share.
Nobia's sales for the fourth quarter compared with the year-earlier period were adversely impacted by a weaker market performance in all regions.
Negative currency effects of SEK 64 million (neg: 12) impacted net sales for the quarter. Sales declined 2 per cent organically.
The gross margin was 42.0 per cent (39.0), positively impacted by price increases, currency effects and productivity improvements.
Operating profit improved, mainly due to the strengthened gross margin, but also to other cost savings.
Currency effects contributed approximately SEK 30 million (neg: 5) to operating profit excluding restructuring costs, of which negative SEK 5 million (0) in translation effects and SEK 35 million (neg: 5) in transaction effects.
Net restructuring costs charged to operating profit amounted to SEK 739 million, of which SEK 513 million pertained to the impairment of goodwill, primarily in Hygena. Restructuring costs also included impairment of fixed assets in Germany, expenses relating to commitments for the former window supplier Oakworth Joinery in the UK, savings measures in Poggenpohl and store refurbishments in Hygena.
The return on capital employed including restructuring costs was negative 5.4 per cent over the past twelve-month period (3.6).
Operating cash flow amounted to SEK 133 million (neg: 127) and the improvement was primarily driven by higher earnings generation and a positive change in working capital.
Comments from the CEO
"A key reason for our success in improving the operating margin, despite weak markets and lower income, was the major savings that were implemented. Since 2010, about 1,000 employees have left the Group and accumulated annual savings amount to approximately SEK 250 million from 2013. We have also introduced a largely Group-wide range and taken important steps towards a more efficient production structure. In 2013, we will continue to optimise the use of the company's assets and be proactive regarding cost savings. I am convinced that our margin target of 10 per cent will be achieved once demand rises," says Morten Falkenberg, President and CEO.
For further information
Please contact any of the following on: +46 (0)8 440 16 00 or +46 (0)705 95 51 00:
· Morten Falkenberg, President and CEO
· Mikael Norman, CFO
· Lena Schattauer, Head of Investor Relations