Bergman & Beving AB: Interim Report 1 April–31 December 2019

Press release

Interim Report 1 April–31 December 2019

Third quarter (1 October–31 December 2019)

• Revenue amounted to MSEK 976 (994).
• EBITA totalled MSEK 37 (64), corresponding to an EBITA margin of 3.8 percent (6.4).
• Net profit totalled MSEK 18 (45).
• Earnings per share amounted to SEK 0.65 (1.65).
• Cash flow from operating activities totalled MSEK 151 (110).

Nine months (1 April–31 December 2019)

• Revenue amounted to MSEK 2,970 (2,950).
• EBITA totalled MSEK 151 (192), corresponding to an EBITA margin of 5.1 percent (6.5).
• Net profit totalled MSEK 86 (131).
• Earnings per share amounted to SEK 3.20 (4.85).
• Return on working capital (P/WC) amounted to 17 percent (22).

Significant events since the start of the operating year

• Five acquisitions have been completed, one of which after the end of the period, with total annual revenue of approximately MSEK 270.
• Collaboration began with Sundström Safety AB through a jointly owned company with Bergman & Beving as the majority shareholder.
• Jörgen Wigh was elected as the new Chairman of the Board at the Annual General Meeting on 26 August 2019. Fredrik Börjesson and Alexander Wennergren Helm were elected as new directors.

CEO’s comments

We experienced a weaker demand in our main markets due to the mild winter and the fact that customers reduced their inventories and were significantly more cautious in their purchasing. The lower revenue in combination with cost for restructuring effected the operating result negatively.

Our long-term focus on sales and marketing of our strong proprietary brands yielded result and the share of sales from proprietary products increased to 65 percent. We were also successful in the initiatives to broaden the customer base and we signed several new contracts during the period.

Our measures to counteract the effects of a weakened krona and raw material prices had the desired effect, and the gross margin improved compared with the last two quarters and is now back at the preceding year’s level. Parallel with our growth initiatives our measures to reduce cost continued. To adapt the operations to the prevailing market conditions the measures were expanded to MSEK 100. Costs associated with carrying out these measures had a negative effect of approximately MSEK 16 on earnings for the quarter. Working capital decreased and cash flow from operating activities improved during the period.

We also continued our more forward-looking investments in innovation, geographic expansion and digitisation. During the quarter several new product concepts within the growth area Personal Protection Equipment were introduced to the market. Fireseal established a new sales company in the interesting US market in order to strengthen their local presence.  We work hard to develop our companies and to boost our efficiency in a more decentralized structure. Ultimately, this will create the conditions to achieve our financial targets, even if our current profitability is well below our long-term goal. We will continue to focus intensely on sales, prioritising on our strong brands and investments for improved profitability.  

Acquisitions remain an important part of our strategy for growth and after the end of the quarter, we acquired VIP Safety. The company is based in the Benelux countries and has annual revenue of approximately MSEK 40 with healthy profitability. The acquisition is part of our plan for the geographic expansion of our strong brands in the region.

Stockholm, February 2020

Pontus Boman

President & CEO

For further information, please contact:

Pontus Boman, President & CEO, Tel: +46 10 454 77 00

Peter Schön, CFO, Tel: +46 70 339 89 99

This information is information that Bergman & Beving AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out above, at 7:45 CET on 7 February 2020.

Bergman & Beving owns and refines companies that develop and market strong brands for professional users in industry and construction, mainly in the Nordic region, the Baltic States and Poland. Bergman & Beving aims to enable successful product companies to take the next step and become leading brands in their categories. The Group currently has some 20 brands, about 1,000 employees and revenue of approximately SEK 4 billion. Bergman & Beving is listed on Nasdaq Stockholm. Read more on the company’s website: www.bergmanbeving.com.

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• Bergman_Beving_Q3_19_20_eng