1 JANUARY–30 JUNE 2014
· Order intake rose 7% to SEK 4,832 million (4,525). For comparable units,
order intake decreased by 1%.
· Net sales rose 8% to SEK 4,680 million (4,331). For comparable units the
change was marginal.
· Operating profit before amortisation of intangible non-current assets
(EBITA) rose 11% to SEK 506 million (455), corresponding to an EBITA margin of
10.8% (10.5%).
· Profit after tax rose 14% to SEK 300 million (264).
· Earnings per share were SEK 7.50 (6.58).
· Cash flow from operating activities amounted to SEK 316 million (294).
During the last 12-month period, cash flow per share was SEK 22.03 (17.38).
SECOND QUARTER 2014
· Order intake rose 7% to SEK 2,484 million (2,327). For comparable units the
change was marginal.
· Net sales rose 7% to SEK 2,430 million (2,280). For comparable units the
change was marginal.
· Operating profit before amortisation of intangible non-current assets
(EBITA) rose 7% to SEK 282 million (264), corresponding to an EBITA margin of
11.6% (11.6%).
· Profit after tax rose 11% to SEK 174 million (157).
· Earnings per share were SEK 4.35 (3.90).
· Cash flow from operating activities amounted to SEK 226 million (263).
CEO´s MESSAGE
While the cautious optimism that existed after the first quarter remains, we
have not yet seen any clear trend in the form of a general upswing in demand.
The business climate improved somewhat during the second quarter compared with
the preceding quarter and corresponding quarter a year ago, but is still
characterised by great uncertainty. In addition, order intake for the Group’s
companies continues to show considerable variation between months, segments and
geographies.
Acquisitions are central to the Indutrade Group’s development, and the pace of
acquisition increased during the quarter through four completed acquisitions and
a total of six since the start of the year. Combined annual sales for the units
acquired thus far during the year amount to approximately SEK 350 million.
We see that Indutrade’s business model and our company culture fit well in the
UK and Ireland, and have therefore consciously increased our acquisition
activity there. During the first part of the year we completed four acquisitions
in this region. Our goal is to continue growing in these countries, both through
additional acquisitions as well as organically, and we consider it realistic to
reach sales of minimum SEK 1 billion within a few years.
Second quarter
Order intake during the quarter exceeded net sales by 2% and was 7% higher than
in the corresponding period in 2013. All of the business areas reported order
intake in excess of net sales during the quarter, and three of the five business
areas had higher order intake for comparable units than the corresponding period
a year ago.
In the Nordic countries, development was slightly positive in Sweden and
essentially unchanged in Norway and Denmark, while demand in Finland was at a
continued low level. Outside the Nordic countries, development was positive
particularly in the UK and Ireland, and to some degree in Germany and Benelux.
Net sales during the past quarter grew 7%. For comparable units the change was
marginal.
Engineering & Equipment, with operations primarily in Finland, continues to be
negatively affected by the low level of domestic industrial activity, and order
intake decreased by 8% during the quarter.
Flow Technology noted higher order intake also during the second quarter, which
was distributed across most segments in the business area. Earnings for the
quarter were hurt by somewhat lower gross margins combined with a slight rise in
the business area’s overheads.
Fluids & Mechanical Solutions experienced positive development during the
quarter for most of the business unit’s operations, except for the filters
segment, which noted a slight decline. Higher net sales combined with continued
good cost control resulted in improved profitability for the quarter.
Industrial Components continues to perform very strongly. Order intake grew 16%
during the quarter, and growth was both organic and acquisition-driven. Most
companies showed growth, particularly in the med-tech, mechanical components and
industrial chemical products segments. Earnings improved by 30%, with a good
EBITA margin.
Special Products’ total order intake rose 7% despite negative organic growth,
owing to a decrease in project-based orders in Switzerland during the quarter.
It is gratifying to note that order intake for the energy segment recovered
following a couple of weak quarters. Most other businesses noted a slight
improvement in order intake at the same time that recently acquired units
continued to develop according to plan. The earnings increase during the quarter
came mostly from completed acquisitions. This was counteracted by a poorer mix,
i.e., sales with high margins have been replaced by volumes from businesses with
lower margins, resulting in a lower EBITA margin for the quarter.
Margins
The Group’s gross margin remains stable at 34% (34%). The EBITA margin was 11.6%
for the quarter (11.6%), which is higher than the Group’s target of a minimum
10% EBITA margin over a business cycle.
Acquisitions
Four acquisitions were carried out in the UK during the quarter: CRP Ltd, which
specialises in corrosion-resistant piping, valves and expansion bellows; Micro
Spring and Presswork Ltd, which manufactures industrial springs and stampings;
Birmingham Specialities Ltd, a specialist manufacturer of industrial components;
and ALH Systems Ltd, a specialist in encapsulants, sealants and adhesives.
Outlook
The trend we have seen during the first half of the year will likely continue
during the coming autumn, i.e., some growth in a number of segments and in
certain geographical areas. Our ambition is, according to Indutrade’s business
model, to continue acquiring companies during the autumn.
Johnny Alvarsson, President and CEO
For further information, please contact: Johnny Alvarsson, President and CEO: 46
70 589 17 95
About Indutrade
Indutrade markets and sells components, systems and services with a high-tech
content within selected niches. Indutrade's business is distinguished by
- high-tech products for recurring needs
- growth through a structured and tried-and tested acquisition strategy
- a decentralised organisation characterised by an entrepreneurial spirit.
The Group is organised into five business areas: Engineering & Equipment, Flow
Technology, Fluids & Mechanical Solutions, Industrial Components and Special
Products. Indutrade's sales totalled SEK 8,831 million in 2013, generating
operating income of SEK 990 million before depreciation of intangible assets.
Indutrade is listed on the Nasdaq OMX Stockholm.
