BE Group Q3 2016 – Strongly improved operating result

• Net sales decreased by 8 percent to SEK 892 M (966).
• Out of the decrease in net sales of SEK 74 M, SEK 63 M is attributable to the
operations under restructuring.
• The underlying operating result was unchanged at SEK 10 M.
• The operating result improved to SEK 26 M (-117 whereof SEK -124 M is related
to non-recurring items).
• The result after tax was SEK 16 M (-133). • Earnings per share amounted to SEK
1.25.

CEOs Message
Comments on the quarter
The third quarter of 2016 is another step in the right direction for BE Group.
Although a weak start of the quarter, we achieved a volume in our business areas
that matched last year’s. Depending on the on-going restructuring of the
operations in the Czech Republic and Slovakia, BE Group recognizes total sales
that are 8 percent lower. Thanks to continued good underlying gross margins and
lower costs, the Group is reporting an unchanged underlying operating result of
SEK 10 M. The price increase on steel that occurred during the year has led to
inventory gains of SEK 16 M and the operating result accordingly improved to SEK
26 M.

The cash flow continues to improve compared with the previous year. Seen over
the past 12 months, SEK 112 M was generated from operating activities, which
considerably reduced the company’s net debt. It is also pleasing that the Group
is showing positive net earnings for the second consecutive quarter.

Structural and organisational change
The structural process for the closure of unprofitable units that was begun in
the second quarter is continuing according to plan. The operations in Slovakia
and the production operations in Estonia are being closed and the sales of flat
carbon steel and aluminium in the Czech market are being concluded. During the
quarter, the sales of inventories concerned was finalized, and the number of
employees was reduced. The affected employees have excellently contributed to a
successful process. The restructuring, for which expenses of SEK -45 M were
recognized in the first quarter, will be completed in 2016.

During the second quarter, a new Group structure and organisation based on the
Group’s business models was launched. As a result of this and the on-going
restructuring of the Group’s operations in the Czech Republic and Slovakia, the
Group is now operating according to the structure set out below:

• Business area Sweden & Poland comprises the Group’s operations in Sweden and
Poland and is operated in two business units focused on distribution and
production, respectively.
• Business area Finland & Baltics comprises the Group’s operations in Finland
and the Baltic States and are operated as three business units: Finland
distribution, Baltics distribution and Finland production.

While the Group´s operations in the Czech Republic and Slovakia are undergoing
restructuring, these operations are reported under the Parent Company and
Consolidated Items segment.

During the third quarter, work continued on implementing improvement measures
linked to the new structure. Work of identifying synergies in production
operations is under way together with the development of processes and refining
the Group’s offerings.

Outlook
Demand is expected to remain at the current level in the Group’s primary
markets. Delivered tonnage will be impacted negatively by the restructuring in
the Czech Republic and Slovakia. Steel prices are expected to be in line with
the third quarter until year-end.

Anders Martinsson, President and CEO

For further information, please contact:
Anders Martinsson, President and CEO
tel.: +46 (0)706-21 02 22     e-mail: anders.martinsson@begroup.com

Andreas Karlsson, CFO
tel.: +46 (0)709-48 22 33     e-mail: andreas.karlsson@begroup.com

This information is information that BE Group AB (publ) is obliged to make
public pursuant to the EU Market Abuse Regulation and the Securities Markets
Act. The information was submitted for publication, through the agency of the
contact persons set out above, at 7.45 am CET on October 25, 2016.

BE Group, listed on Nasdaq Stockholm, is a trading and service company in steel,
stainless steel and aluminium. BE Group offers efficient distribution and value
-adding production services to customers primarily in the construction and
engineering sectors. In 2015, the Group reported sales of SEK 4.2 billion. BE
Group has about 730 employees, with Sweden and Finland as its largest markets.
The head office is located in Malmö, Sweden. Read more about BE Group at
www.begroup.com.