Sweden, Lund, 2017-07-13 08:00 CEST (GLOBE NEWSWIRE) -- Higher earnings and stronger margins
April – June 2017
- Net sales amounted to SEK 446.0m (473.5), a decrease of 5.8 percent. Net sales were up by 5.5 percent excluding the US/Canada region
- Operating profit (EBIT) of SEK 19.1m (4.2), corresponding to an operating margin of 4.3 percent (0.9). EBIT includes SEK 2.2m (4.9) of restructuring expenses
- Order intake decreased by 6.4 percent to SEK 442.2m (472.3)
- The order book amounted to SEK 278.7m (273.7) at the end of the period
- Profit after tax for the period was SEK 15.3m (1.2)
- Earnings per share amounted to SEK 0.65 (0.05)
- Free cash flow before acquisitions amounted to SEK -1.4m (-10.1)
Outlook
Unchanged outlook: Our expectation for 2017 is that both sales and EBIT will increase compared to 2016.
CEO’s comment
Doro’s sales performance varied between its different regions in the second quarter, while earnings continued to improve. Second-quarter sales were down by 5.8 percent to SEK 446.0m (473.5), while growth excluding the US/Canada region was positive, with sales increasing by 5.5 percent. Order intake was down by 6.4 percent to SEK 442.2m (472.3), while the order book grew by 1.8 percent. The earnings improvement continued in the second quarter, with gross margin expanding to 39.1 percent (36.4). I’m seeing more stability in our earnings and cash flow, which enabled us to increase our equity/assets ratio.
Doro Care, which we have been reporting as an independent region since the start of this year, increased sales by 7.7 percent in like-for-like terms, supported by strong progress in Germany, and a stable level of subscription-based operations in the Nordics. In total, Doro Care significantly improved margins, largely thanks to rationalization measures executed. Health and social care is moving rapidly towards digitalisation, with more widespread usage of connected sensors and devices, cloud-based tools and artificial intelligence. Our strategy for Care is, in time, to be able to offer an extensive range of products and services for the new health and social care digital ecosystem.
Sales in the US/Canada region continued to decrease in the second quarter compared to the second quarter of the previous year, but increased compared to the previous, first, quarter. We think the comparative figures will gradually improve in the second half-year. The action plan we have initiated, which includes enhancing our product offering, create the potential to re-establish a stable sales level in the US in time.
Progress on our markets in the second quarter was challenging to some extent, with low or no growth in retail trade (big-ticket items) on several of our markets. However, we did succeed in increasing sales in four of seven regions, including our largest: DACH, where sales were up by 24.1 percent.
After a thorough overhaul of our working methods and processes, we commenced the execution of a series of actions to consistently improve the efficiency and reduce the costs of our business. The early indications are positive, and we expect to be able to provide more information on outcomes later in the year.
Preparations for the important IFA trade show in Berlin in early-September are underway. We have high hopes of getting just as positive a response to our products and innovations in Berlin as we did at the Mobile World Congress in Barcelona earlier this year.
Doro remains strongly positioned in the senior segment, and we think we are defending our market shares well. Looking ahead, I see a wealth of exciting opportunities to evolve and enhance our offering and our market positioning further. With our first half-year results in hand, we are reiterating our outlook for 2017: our expectation for 2017 is that both sales and EBIT will increase compared to 2016.
Robert Puskaric, President & CEO
For further information, please contact:
Robert Puskaric, President and CEO, +46 (0)46 280 50 05
Magnus Eriksson, CFO, +46 (0)46 280 50 06
Doro’s report to be presented via audiocast
Analysts, investors and media are welcome to attend a presentation of the Q2 report via http://edge.media-server.com/m/p/j5gzg5cb or by telephone at 9:00 CET on July 13, 2017. Doro’s President and CEO Robert Puskaric and CFO Magnus Eriksson will hold the presentation and answer questions. Before the start of the presentation, the presentation material will be available at: http://corporate.doro.com/blog/hp-doro-webcast.
Call-in numbers
Sweden: + 46 (0) 8 505 564 74
France: + 33 (0) 170 750 712
UK: + 44 (0) 203 364 5374
US: + 1 855 7532 230
About Doro
Doro develops telecom products and services for Seniors to lead full and rich lives: to do things they want to do more easily as well as the things they thought they might never do. The global market leader in senior mobile phone, Doro offers easy-to-use mobile phones and smart phones, mobile applications, fixed line telephony with loud and clear sound. Within Doro Group, Doro Care offers social care and telecare solutions for elder and disabled persons for independent and safe living in their own homes. Doro AB is a Swedish public company and its shares are quoted on the Nasdaq OMX Stockholm exchange, Nordic List, Small Companies. Net sales of SEK 1,959 million (EUR 205 million) was reported for 2016.
This information is information that Doro AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 08:00 CET on July 13, 2017.
