MQ Holding AB – Year-end report

Sharp improvement in earnings creates prerequisites for increased focus on
growth

The strong fourth quarter confirms the positive trend reported by MQ throughout
the entire year. Increased like-for-like sales, a higher gross margin, more
efficient operations and lowered costs mean substantially increased earnings.
The action programme presented one year ago has over delivered and provided MQ
with financial stability. Net debt is at a historic low and the strong cash flow
creates the prerequisites for increased focus on growth.

Fourth quarter (June 2014-August 2014)

  · Net sales amounted to SEK 381 million (349), up 9.2 percent. Sales in
comparable stores increased 7.9 percent (according to the Swedish Retail
Institute Index, the market grew 2.7 percent.)
  · The gross margin was 54.9 percent (51.6).
  · Operating profit amounted to SEK 35 million (5), corresponding to an
operating margin of 9.1 percent (1.4).
  · Profit after tax was SEK 26 million (36), corresponding to SEK 0.74 (1.03)
per share after dilution. The preceding year’s profit includes a positive effect
of SEK 35 million on deferred taxes, resulting from a change in the corporate
tax rate. Following adjustment for positive tax effects in the preceding year,
profit after tax amounted to SEK 26 million (1), corresponding to SEK 0.74
(0.03) per share after dilution.
  · Cash flow from operating activities totalled SEK 34 million (negative: 15).

12-month period (September 2013-August 2014)

  · Net sales amounted to SEK 1,520 million (1,463), up 3.9 percent. Sales in
comparable stores increased 2.6 percent (according to the Swedish Retail
Institute Index, the market grew 0.1 percent.)
  · The gross margin was 56.2 percent (55.3).
  · Operating profit amounted to SEK 132 million (50), corresponding to an
operating margin of 8.7 percent (3.4).
  · Profit after tax was SEK 96 million (62), corresponding to SEK 2.76 (1.79)
per share after dilution. The preceding year’s profit includes a positive effect
of SEK 35 million on deferred taxes, resulting from a change in the corporate
tax rate. Following adjustment for positive tax effects in the preceding year,
profit after tax amounted to SEK 96 million (27), corresponding to SEK 2.76
(0.78) per share after dilution.
  · Cash flow from operating activities was SEK 152 million (57).
  · The Board proposes a dividend of SEK 1.36 (0.39) per share, corresponding to
50 percent of the year’s profit after tax.

Events during the fourth quarter

  · The external brands Lee, Twist&Tango, Jofama, Bread&Boxers and Sail Racing
women’s fashion were launched in MQ’s stores. The InWear, Matinique and
Knowledge Cotton Apparel brands were launched on MQ Shop online.
  · The head office in Gothenburg has been concentrated from two floors to one,
which has both lowered costs and strengthened the corporate culture.

Events after the end of the reporting period

  · MQ decided to close one store in Bogstadveien, Oslo. In parallel, MQ has
signed a contract for a premises in Grensen, Oslo, to create MQ’s first flagship
store in Norway.
  · The external brands NN07 and Elvine men’s fashion have been contracted and
launched at MQ during the autumn. A contract has been signed with Lacoste for
launching the brand on MQ Shop online.

For further information, please contact:
Christina Ståhl, President and CEO: Tel: +46 (0)31 388 80 10
Tony Siberg, Deputy CEO and CFO: Tel: +46 (0)31 388 84 01
MQ Holding AB – Year-end report

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