Interim Report for Duni AB (publ) 1 January – 30 September 2014


Growth and strong operating margin
1 July – 30 September 2014

  · Net sales amounted to SEK 1 100 m (936). Adjusted for exchange rate changes,
net sales increased by 12.1 %.
  · Organic growth in the core business, currency-adjusted net sales (excluding
acquisitions and the hygiene products business) increase by 5.5%.
  · Earnings per share, after dilution amounted to SEK 1.85 (1.25).
  · Improved operating margin within the three dominant business areas.
  · Strengthened position on most markets.
  · Decision to concentrate Rexcell Tissue & Airlaid AB’s production in a single
locality.

1 January – 30 September 2014

  · Net sales amounted to SEK 3 037 m (2 701). Adjusted for exchange rate
changes, net sales increased by 8.2 %
  · Earnings per share, after dilution amounted to SEK 4.48 (3.43).
  · Acquisition of Paper+Design, which is reported within the Consumer business
area as from the middle of June.



Key financials

SEK m          3 months   3 months   9 months   9 months   12 months   12
               July       July-      January-   January-   October     months
               -          September  September  September  -September  January
               September  2013       2014       2013       2013/2014   -December
               2014
                                                                       2013
Net sales      1 100      936        3 037      2 701      4 139       3 803
Operating      132        88         306        234        458         385
income1)
Operating      12.0 %     9.4 %      10.1 %     8.6 %      11.1 %      10.1 %
margin1)
Income  after  117        75         285        212        423         350
financial
items
Net income     87         59         211        161        317         267

1)       For bridge to EBIT, see the section entitled “Operating income - Non
-recurring items”.


CEO’s comments

“Duni's third quarter is historically strong and includes improvements in all
major business areas. Growth – which reached 18% in the quarter – is being
driven primarily by the acquisition of Paper+Design, volume increases in the
core business, and positive currency effects. Excluding currency and structural
effects, the organic growth is in line with our financial target of 5%, and with
a good end of the year we see that the growth target can be achieved. Net
invoicing amounts to SEK 1,100 m (936) and the operating income increased to SEK
132 m (88). The net debt is SEK 1,061 m (673).

In addition to volume increases, efficiency improvements are also contributing
to improved operating income. The operating margin for the quarter increased to
12.0% (9.4%), driven by Paper+Design and by improvements within the production
and logistics units as well as within our business areas. We have a lower
percentage of indirect costs compared with the preceding quarter, as well as
more efficient logistics flows. Our assessment is that the disruptions reported
within logistics in the preceding quarterly report will be entirely made up for
during the final quarter of 2014.

Since hygiene product production will terminate after the first quarter 2015, a
decision has been taken to concentrate all remaining production in Dalsland at
the plant in Skåpafors. Accordingly, the operations in Dals Långed will be shut
down during the autumn of 2015. The concentration will lead to efficiency
improvements and an increase in capacity within important product segments, and
is expected to be fully implemented during the autumn of 2015.

With the exception of Materials & Services, all business areas grew in the
quarter; our largest business area, Table Top, increased sales by 9.7% compared
with the same quarter last year. The increase in sales is due to positive
currency effects and also increased market shares and improved efficiency in
sales operation. During the year, several successful products and concepts have
been launched and Table Top is continuing to grow despite a continued cautious
market.

The Meal Service business area, which is operating in a more favorable market
climate, generated high growth figures also in the third quarter. Net revenues
increased by 10.7% and amounted to SEK 140 m (126). Growth had a leverage effect
on income and the operating margin increased to 5.4% (2.2%). The improvement is
being driven by the business area’s consistent focus on more environmentally
adapted segments and products with unique functionality.

Paper+Design is now integrated in Consumer and the acquisition generated most of
the business area’s increase in earnings and sales in the quarter. The takeover
has been carried out without operational disruptions, and both sales and income
are in line with the plan adopted during the acquisition process. Paper+Design
has a somewhat earlier sales cycle than Duni, entailing that the third quarter
is normally stronger than other quarters. Consumer achieved net sales of SEK 249
m (123) and operating income of SEK 22 m (-4).

During the quarter, the New Markets business area experienced a lower rate of
growth than other business areas. Net sales amounted to SEK 50 m (47), with an
operating income of SEK 1 m (2). The business area was negatively affected
primarily by developments in Russia, where an increasingly weak Ruble is leading
to a decrease in demand for imported products. Growth on other export markets
has been positive, in line with previous quarters.

Within Materials & Services, we are following the phase-out plan regarding the
production of hygiene articles which was adopted at the beginning of the year.
Sales for the quarter amounted to SEK 116 m (142) and operating income fell to
SEK 4 m (9).

The third quarter results are historically strong and it is pleasing that both
structural effects and improvements in the core business are contributing to
growth and an increase in operating income,” says Thomas Gustafsson, President
and CEO, Duni.



Additional information is provided by:

Thomas Gustafsson, President and CEO, +40 10 62 00
Mats Lindroth, CFO, +46 40 10 62 00
Tina Andersson, Corporate Marketing & Communication Director, +46 734 19 62 24


Duni is a leading supplier of attractive and convenient products for table
setting and take-away. The Duni brand is sold in more than 40 markets and enjoys
a number one position in Central and Northern Europe. Duni has some 2,100
employees in 18 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.

Attachments

10223836.pdf