Year-end Report for Duni AB (publ) 1 January – 31 December 2011

Year-end Report for Duni AB (publ) 1 January – 31 December 2011

Increased investments in long-term growth

1 January – 31 December 2011

  · Net sales amounted to SEK 3,807 m (3,971). Adjusted for exchange rate
changes, net sales decreased by 0.8%.
  · Earnings per share amounted, after dilution, to SEK 5.54 (6.52).
  · The Board proposes a dividend of SEK 3.50 (3.50) per share.
  · Higher investments to promote long-term growth.

1 October – 31 December 2011

  · Net sales amounted to SEK 1,063 m (1,097). Adjusted for exchange rate
changes, net sales decreased by 2.0%.
  · Earnings per share amounted, after dilution, to SEK 2.09 (2.49).
  · The operating margin almost on par with a strong quarter last year. Strong
gross margin of 29.7% (28.4%) in the seasonally most important quarter.

Key financials

SEK m         12         12         3 months   3 months October-December
              months     months     October    2010
              January    January    -December
              -December  -December  2011

              2011       2010
Net sales     3 807      3 971      1 063      1 097
Operating     404        435        151        163
income 1)
Operating     10.6%      10.9%      14.2%      14.8%
margin 1)
Income after  358        418        134        163
financial
items
Net income    261        306        98         117

1)Underlying operating income; for link to reported operating income, see the
section entitled "Non-recurring items".

CEO’s comments

“Duni ended 2011 with good profitability during the final quarter of the year,
which includes the all-important Christmas season. Operating income was SEK 151
m (SEK 163 m) and the operating margin reached 14.2% (14.8%). This is somewhat
below a very strong fourth quarter of 2010 and reflects a degree of cautious
restraint on some of Duni's main markets.

Sales largely followed the pattern of the preceding quarter and were 2% lower at
fixed exchange rates. This reflects a stable sales trend within the Professional
business area, while we lost some sales within Retail and Tissue. As far as
Retail is concerned, this is the due to the continued phasing out of the large
private label account which has been commented on previously. In other respects,
sales were stable and Duni has increased its market shares in the grocery retail
trade, particularly in England but also in Benelux.

A degree of weakening was noted in the Tissue business area, which is partly
attributable to inventory reductions at our customers. In terms of income, the
trend within Tissue remained healthy; this is mainly due to productivity
improvements.

For the Professional business area, the quarter was characterized by stability
on the main markets in the Nordic region, Germany and Benelux. An operating
profit of SEK 121 m (SEK 124 m) and an operating margin of 16.1% (16.4%) can be
considered satisfactory in light of the fact that 2011 was a year of increased
capital expenditures and marketing efforts aimed at profitable growth going
forward.

Duni’s largest investment during the year has been in new technology for the
production of a new premium material - Evolin®. A patent has been sought for the
technology and the material, which is entirely unique, is aimed at the table
cover market, with the goal being to reach the same quality level as linen, but
with a more attractive total economy for the end customer. The interesting fact
is that Duni is thereby entering a market segment which is significantly larger
than our current addressable market. The product will be launched gradually
during the first quarter of 2012, with an accelerated rollout thereafter. This
represents an extremely exciting phase in Duni’s development, since the
Company's successes are largely based on unique premium materials such as
Dunilin® and Dunicel®.

We are also focusing on further improving efficiency in the operations. During
2012, we intend to carry out a program of measures to achieve increased
efficiency within the organization as well as in production. Combined with our
investments for growth, this is expected to result in improved profitability.

As regards the macro-economic perspective for 2012, we anticipate a degree of
economic slowdown in Europe in light of the high sovereign debt problems in some
countries and the related Euro crisis. This may have a degree of impact on
volume growth, but it may also bring with it lower prices for input materials,”
says Fredrik von Oelreich, President and CEO, Duni.

Duni is a leading supplier of attractive and convenient products for table
setting and takeaway. The Duni brand is sold in more than 40 markets and enjoys
a number one position in Central and Northern Europe. Duni has some 2,000
employees in 17 countries, headquarters in Malmö and production units in Sweden,
Germany and Poland. Duni is listed on NASDAQ OMX Stockholm under the ticker name
“DUNI”. ISIN-code is SE 0000616716.