Interim report January - June 2012

Record sales in second quarter
Second quarter 2012 year-on-year

  · Revenue increased 10 per cent to SEK 1,295 million (1,182)
  · Other operating income totalled SEK 13 million (0) because the actual
additional purchase price from previous acquisitions deviated from the expected
outcome
  · EBITA and operating profit rose 8 per cent to SEK 54 million (50)
  · EBITA and operating margin totalled 4.2 per cent (4.2); excluding other
operating income, the corresponding margin totalled 3.2 per cent (4.2)
  · In Sweden, which accounts for 77 per cent of consolidated revenue,
Proffice’s revenue increased 9 per cent to SEK 992 million (914). Operating
profit totalled SEK 67 million (71), representing an operating margin of 6.8 per
cent (7.8). Excluding other operating income, the operating margin was 5.6 per
cent (7.8)
  · Cash flows from operating activities totalled SEK ‑73 million (-38)
  · Basic earnings per share totalled SEK 0.55 (0.50)

YTD 2012 year-on-year

  · Revenue increased 10 per cent to SEK 2,495 million (2,278)
  · Other operating income totalled SEK 13 million (0) because the actual
additional purchase price from previous acquisitions deviated from the expected
outcome
  · EBITA and operating profit declined 1 per cent to SEK 94 million (95)
  · EBITA and operating margin totalled 3.8 per cent (4.2); excluding other
operating income, the corresponding margin totalled 3.3 per cent (4.2)
  · In Sweden, which accounts for 77 per cent of consolidated revenue,
Proffice’s revenue increased 9 per cent to SEK 1,992 million (1,763). Operating
profit totalled SEK 118 million (127), representing an operating margin of 6.1
per cent (7.2). Excluding other operating income, the operating margin was 5.6
per cent (7.2)
  · Cash flows from operating activities totalled SEK ‑124 million (-23)
  · Basic earnings per share totalled SEK 0.90 (0.92)


Financial overview

                         Second quarter      YTD       Full year  Change
Group                     2012     2011   2012   2011       2011  quarter
Revenue, SEK million     1,295    1,182  2,495  2,278      4,770      10%
EBITA, SEK million          54       50     94     95        227       8%
EBITA margin, per cent     4.2      4.2    3.8    4.2        4.8        -
Operating profit, SEK       54       50     94     95        218       8%
million
Operating margin, per      4.2      4.2    3.8    4.2        4.6        -
cent
Profit after tax, SEK       39       38     65     70        154       3%
million
Basic earnings per        0.55     0.50   0.90   0.92       2.02      10%
share, SEK
Diluted earnings per      0.55     0.50   0.90   0.92       2.02      10%
share, SEK
Cash flows from            -73      -38   -124    -23        128        -
operating activities,
SEK million
Basic equity per share,   7.27     9.31   7.27   9.31      10.27     -22%
SEK
Return on equity, per      6.9      8.0   11.5   15.1       22.0        -
cent




CEO comments

Record sales for Proffice Group
Sales for the second quarter of 2012 increased 10 per cent to SEK 1,295 million
(1,182), which is the highest quarterly sales figure ever for the Group. Despite
a period with fewer working days than the same period last year, which is hard
on sales and operating profit in the industry, we managed to grow in both Sweden
and Norway.

We continue to win the trust of customers, and it is becoming increasingly clear
that more people want our services.

Sales are increasing significantly in the Industry/Logistics, Finance, and IT
business areas in all markets. Industry/Logistics is growing by as much as 38
per cent compared with the same period in 2011.

Consolidated operating profit increased to SEK 54 million (50), representing an
operating margin of 4.2 per cent (4.2). Other operating income affected
operating profit by SEK 13 million (0).

Sweden: Growth continues in a difficult to assess macroeconomic climate
Despite a stagnant market, Proffice Sweden grew 9 per cent in the second quarter
compared with the same period last year. During the period, our Swedish
operation showed a profitability of 6.8 per cent (7.8). The uncertain economic
situation is demonstrated by the fact that our Outplacement operating area
increased 31 per cent during the quarter, while Recruitment decreased 4 per
cent. With a balanced product portfolio that offers staffing, recruitment and
outplacement, Proffice can hold its own in the face of economic changes. We can
expand our business dealings while deepening customer relationships and become
an even more essential partner.

The implementation of our new Group-wide enterprise resource planning (ERP)
system has continued during the second quarter. Costs for this and a temporary
invoicing delay, combined with fewer working days, continued to encumber
liquidity and profitability in the second quarter.

We signed several important agreements during the second quarter, including a
nationwide master agreement with Posten Logistik, under which we are one of five
suppliers, and an expanded partnership with Logica. After the period, the
Swedish Public Employment Service entrusted Proffice as its leading recruitment
provider for two years.

Norway: Strong profitability a sign of strength
Norway’s labour market continues to be favourable and the Norwegian business
continues to evolve as planned. Operating profit increased 67 per cent to SEK 10
million (6) and sales increased 18 per cent compared to the same period last
year. Last year’s reorganisation to the same specialisation organisation as in
Sweden continues to reap success. The Industry/Logistics business area shows the
most growth: 46 per cent compared with the same period last year. Several
existing accounts performed well during the quarter, including Tine, Nortura,
and AGA. We will strengthen our offering in Norway in the third quarter of 2012
by starting Dfind Engineering, a company that will specialise in staffing and
recruiting engineers, a service that is in high demand in the Nordic market.

Focus on competence generates growth and profitability
We are affected by a general cautiousness in a market where many are holding
their breath, waiting to see what will happen in certain euro zone countries.
Challenges within the business sector give rise to an even greater need to find
the right talent. At the same time, the labour market is marked by high youth
unemployment and growing alienation, but also a shortage of competence in
certain industries. Here is where Proffice will play an increasingly bigger role
in the future. By actively focusing on competency, and thus creating a more
inclusive labour market, we can make a difference and generate further growth.

Proffice continued to work on the important issue of diversity during the
quarter and has taken a number of initiatives to move forward and show that
diversity and profitability go hand in hand. At the Almedalen Week forum, a
diversity network initiated by Proffice was presented, in which we and several
business leaders want to show how to best take advantage of the untapped
competence of all those who are outside the labour market.

In the second quarter, a partnership was also concluded with Uppstart Malmö, in
which we work together with entrepreneurs to help highlight people’s competence
and help companies and entrepreneurs grow.

Through an entrepreneurial corporate culture we will be first with the best
services and meet both existing and new customer needs with optimal staffing
solutions.

Our vision remains unchanged: Proffice aims be the most successful staffing
company in the Nordic region. With good cost control, closer customer
relationships and by focusing on competence, we ensure increased profitability
and growth.


Lars Kry
President and CEO Proffice