Interim report, 1 January - 31 March 2011

Interim report, 1 January - 31 March 2011

22% YEAR ON YEAR SALES GROWTH

CDON Group AB (publ.) ("CDON Group” or “the Group") (Nasdaq OMX
Stockholm's Mid Cap market: CDON) today announced its financial results
for the first quarter ended 31 March 2011.

First Quarter Highlights

  · Net sales up 22% year on year to SEK 571.8 (469.7) million
  · Gross profit up 17% year on year to SEK 109.9 (93.6) million, with a
gross margin of 19.2%
  · Operating profit of SEK 20.1 (37.9) million with an operating margin
of 3.5%
  · Net income of SEK 12.7 (25.0) million
  · Basic earnings per share of SEK 0.19
(49.46)[1] (https://connect.ne.cision.com/#_ftn1)
  · Acquisition of designer brand furniture and interior decoration
e-retailer RUM21.se
  · Launch of Gymgrossisten.com sports and health store in Denmark as
Bodystore.dk
  · Fashion store Nelly.com's presence in Germany made permanent
following positive evaluation, and new test launch in Austria 
 
 

Mikael Olander, President & Chief Executive Officer, commented: "Our
record first quarter sales further demonstrate the scalability of the
platform and our capability to develop the existing businesses, acquire
and launch new internet stores, and enter new markets. Group revenues
were up 22% year on year in the first quarter, and gross profits were up
17% with a gross margin of 19.2%, despite the accelerating migration
away from media products towards higher growth product categories such
as consumer electronics, which grew to become the second largest product
group within the Entertainment segment. 

“We have continued to expand the business in line with our strategy in
the first quarter by acquiring furniture and interior design retailer
RUM21.se, rolling out Nelly.com in Germany with market tests in the
Netherlands and Austria, launching Gymgrossisten.com in Denmark as
Bodystore.dk, and broadening the assortments of all of our online
stores. The year on year development in our sales and profitability also
reflected the launch of Heppo.com in Sweden in September 2010, the
acquisition of Lekmer.com at the end of the first quarter of last year,
and the pan-Nordic extension of both brands.

“As predicted, the year on year decline in profitability reflects the
investments that we have been making, the shift in the sales mix and the
costs associated with being a separately listed company, as well as the
substantial year on year appreciation of the Group's Swedish krona
reporting currency. We continue to expect to deliver a slight
improvement in our underlying operating margin for the full year. We
have the funds required to further develop the business and benefit from
e-commerce's rapidly growing share of total retail sales, and we
continue to review opportunities to expand both organically and by
acquisition.“

* * *

 The company will host a conference call today at 15.00 Stockholm local
time, 14.00 London local time and 09.00 New York local time.

To participate in the conference call, please dial:
Sweden: +46 (0)8 5352 6440
International: +44 (0)20 7138 0826
US: +1 212 444 0481

The access pin code for the conference call is 9499049.

To listen to the conference call online, please go to www.cdongroup.com.

* * *

For additional information, please visit
www.cdongroup.com (http://www.cdongroup.com/) or contact:
Mikael Olander, President & Chief Executive Officer
Phone: +46 (0) 10 703 20 00

Investor and analysts enquires:
Martin Edblad, Chief Financial Officer
Phone: +46 (0) 700 80 75 03
E-mail:  ir@cdongroup.com (ir@cdongroup.com)

Media enquires:
Fredrik Bengtsson, Head of Communications
Phone:  +46 (0) 700 80 75 04
E-mail:  press@cdongroup.com (press@cdongroup.com)

About CDON Group
CDON Group is one of the leading e-commerce groups in the Nordic region.
Established in 1999, the Group has continuously expanded its product
portfolio and is now a leading e-commerce player in the Entertainment
(CDON.COM, BookPlus.fi, Lekmer.com), Fashion (Nelly.com, LinusLotta.com,
Heppo.com, RUM21.se), and Sports & Health (Gymgrossisten.com,
Bodystore.com) segments. CDON Group's nine online stores attract
approximately 115 million site visits and two million unique customers a
year.

The information in this announcement is that which CDON Group AB is
required to disclose under the Securities Markets Act. This information
was released for publication at 13:00 CET 19 April 2011. 

[1] (https://connect.ne.cision.com/#_ftnref1) Earnings per share for
Jan-Mar 2010 have been recalculated following the 250:1 share split in
September 2010. The weighted average number of issued shares for this
period was 500,000. The weighted average number of shares before
dilution for the first quarter 2011 amounted to 66,342,124. The weighted
average number of shares after dilution in the first quarter 2011
amounted to 72,921,071.