Year-end report January - December 2013

1 January – 31 December 2013
● Revenues for the full year increased 8 per cent to SEK 5,863 M (5,426).
Adjusted for currency effects and
calculated on comparable number of workdays, revenues rose 10 per cent.
● EBITA rose 4 per cent to SEK 626 M (602) and the EBITA margin was 11 per
cent (11).
● EBIT was negatively impacted by a write-down of SEK 45 M and amounted to SEK
469 M (528).
The EBIT margin was 8 per cent (10).
● Earnings per share before and after dilution amounted to SEK 8.56 (10.80).
● Net debt amounted to SEK 1,657 M (1,875).
● The Board of Directors proposes a dividend of SEK 7.00 (7.00).
1 October – 31 December 2013
● Revenues for the quarter declined 7 per cent to SEK 1,450 M (1,556).
Adjusted for currency effects and calculated
on a comparable number of workdays, revenues declined 4 per cent.
● EBITA amounted to SEK 124 M (152) and the EBITA margin was 9 per cent (10).
● EBIT was negatively impacted by a write-down of SEK 45 M and amounted to SEK
52 M (125).
The EBIT margin was 4 per cent (8).
● Gross margin rose to 54.6 per cent (51.6).
● Profit after financial items amounted to SEK 49 M (109).
● Earnings per share before and after dilution amounted to SEK 0.88 (3.36).
● Cash flow from operating activities amounted to SEK 173 M (224).
Significant events
● EBIT was adversely impacted by an additional write-down totalling SEK 45 M
pertaining to the discontinuation
of an IT system in the fourth quarter. CEO’s commentsINCREASED FOCUS ON
ORGANIC GROWTH● Revenues for the full year 2013 increased 8 per cent● EBIT
amounted to SEK 469 M (528), including an additional write-down of SEK 45 M●
Weak results in Denmark for the full-year● Gross margin increaseThe 2013
financial year was characterised by weak market growth. Revenues for the
Mekonomen Group for full year 2013increased 8 per cent to SEK 5,863 M (5,426)
and EBIT declined to SEK 469 M (528), including an additional write-downof SEK
45 M pertaining to the discontinuation of an IT system. EBITA for the full
year increased 4 per cent to SEK 626 M(602). EBIT for the fourth quarter,
excluding the additional write-down, amounted to SEK 97 M (125). Cash flow
fromoperating activities amounted to SEK 173 M (224) for the fourth
quarter.Our assessment ahead of 2013 was that it would be a weak year in the
market, which is why our focus during the year wason streamlining our
processes and procedures, as well as launching new concepts. The store network
has beenconsolidated, purchasing has been further coordinated following the
acquisition of Sørensen og Balchen and MECA andproprietary products were
launched in the Group, ProMeister for spare parts and CarWise for accessories.
Coordinationof purchasing and launching of proprietary brand products
strengthened the gross margin, in a market with toughcompetition and pressure
on prices.The two most significant items that have reduced EBIT are an
additional write-down pertaining to the discontinuation ofan IT system of SEK
45 M and that Denmark's EBIT was SEK 37 M lower than in 2012.EBIT for Sørensen
og Balchen rose to SEK 81 M (78) for the full year. EBITA for the full-year
increased to SEK 99 M(97) and the EBITA margin rose to 14 per cent (13). Net
sales amounted to SEK 701 M (748). The underlying net salesfell 1 per cent
(one).EBIT for Mekonomen Nordics for the full year 2013, excluding the
additional write-down, amounted to SEK 361 M (376).EBITA for the full year
2013 amounted to SEK 383 M (390) and the EBITA margin was 13 per cent (13).
Net salesamounted to SEK 2,818 M (2,830). The underlying net sales rose 1 per
cent (one). Mekonomen Sweden’s EBIT marginwas 16 per cent (16) and Mekonomen
Norway’s EBIT margin rose to 15 per cent (14) for the full year.MECA’s EBIT,
including Denmark, amounted to SEK 84 M (109) for the full year 2013. EBITA
for the full year 2013amounted to SEK 156 M (150) and the EBITA margin was 7
per cent (9). EBIT in Denmark for the full year was anegative SEK 58 M (neg:
21). Repositioning in Denmark with a strong focus on workshops continues.
During 2013,MECA’s business system and catalogue were introduced in Denmark.
Implementation is completed, meaning that ourDanish operation will now be
better equipped going forward to achieve growth and profitability whilst also
takingadvantage of our workshop chain Mekonomen Autoteknik having a strong
position in Denmark. However, ourassessment is that it will take time to reach
profitability in Denmark.In addition to the efficiency enhancements in
Denmark, a cost-savings programme was initiated in the Group, withadditional
coordination of central functions. The programme is expected to generate a
positive effect on the EBIT totallingSEK 30 M on a full year basis starting in
2015. Non-recurring costs due to the programme are expected to amount toSEK 15
M during the first quarter of 2014.Our workshop chains continue to capture
market shares and sales to our affiliated Mekonomen Service Centres andMECA
Car Service workshops in Sweden, Norway and Finland rose 9 per cent and 12 per
cent, respectively, inlocal currency during the full year 2013, compared with
2012. Mekonomen Group’s sales to non-affiliated workshopsand consumers in
Sweden, Norway and Finland declined 4 per cent in local currency, during the
full year 2013, comparedwith 2012.We expect no major changes in the total
market in the Nordic region in 2014, compared with 2013. We believe that
salesto our affiliated workshops will remain strong. During 2014, we will also
be focusing more on increasing sales tonon-affiliated workshops and consumers,
partly through an expanded range in ProMeister and CarWise, and partly
withmore competitive products which will be generated through our cooperation
with Inter Cars and through our Hong Kongoffice. In addition, e-commerce will
remain important focus area. Organic growth is a primary focus in 2014 for
theMekonomen Group.Our employees and leaders are Mekonomen Group's primary
strength and together we will now take the additionalstep to meet competition
and retain leadership!Håkan LundstedtPresident and CEO