Interim report January-September 2011

Interim report January-September 2011

1 July - 30 September

  · Revenues increased 34 per cent, adjusted for currency effects and
calculated on comparable workdays. Prior to adjustment, revenues
increased 33 per cent to SEK 1,117 M (839).
  · EBIT increased 16 per cent to SEK 163 M (141) and the EBIT margin
amounted to 15 per cent (17).
  · Profit after financial items rose 15 per cent to SEK 161 M (140).
  · Profit after tax amounted to SEK 118 M (100).
  · Earnings per share both before and after dilution amounted to SEK
3.53 (3.07).

1 January - 30 September

  · Revenues increased 27 per cent adjusted for currency effects and
calculated on comparable workdays. Prior to adjustment, revenues
increased 23 per cent to SEK 3,149 M (2,555).
  · EBIT increased 15 per cent to SEK 432 M (375) and the EBIT margin
amounted to 14 per cent (15).
  · Profit after financial items rose 13 per cent to SEK 423 M (374).
  · Profit after tax amounted to SEK 309 M (273).
  · Earnings per share both before and after dilution amounted to SEK
9.24 (8.43).
  · Net debt totalled SEK 543 M (87) at the end of the period.

Significant events

  · On 12 October, Mekonomen signed an agreement to acquire Meca. Meca's
sales forecast for 2011 amounts to approximately SEK 1,500 M and
operating profit to about SEK 180 M.
  · The acquisition of Sørensen og Balchen in Norway had a positive
impact of SEK 190 M on net sales for the third quarter and SEK 427 M for
the nine-month period. EBIT was positively impacted by SEK 25 M for the
quarter and SEK 64 M for the nine-month period.
  · EBIT was negatively impacted by SEK 10 M during the quarter and SEK
35 M for the nine-month period, attributable to acquisition costs
connected to Sørensen og Balchen and other ventures.

CEO's comments

Strong third quarter for Mekonomen

  · Successful integration of Sørensen og Balchen
  · Continued success in Denmark

Mekonomen's EBIT for the third quarter of 2011 rose 16 per cent to SEK
163 M (141). The EBIT margin amounted to 15 per cent (17). Revenues,
excluding Sørensen og Balchen, rose 10 per cent during the period and
total revenues increased 33 per cent to SEK 1,117 M. Adjusted for
currency effects and calculated on comparable number of workdays,
revenues increased 34 per cent during the period.

During the third quarter of 2011, Mekonomen sharpened its focus on
prioritised areas such as the integration of Sørensen og Balchen and
Denmark. As in the first half year, the third quarter was characterised
by weak market growth, particularly pertaining to consumer and
accessories sales, which meant that Mekonomen's positive sales trend
weakened somewhat in all markets.

EBIT in Denmark for the third quarter rose to SEK 18 M (12) and the EBIT
margin to 10 per cent (6). The sales trend for workshops was strong and
we have been building up the BilXtra store chain in Denmark since the
second quarter.

The EBIT margin in Sweden amounted to 20 per cent (21) and sales rose 4
per cent. The focus on new units and concepts, for example the Mega
facility at Gärdet in Stockholm, meant that Mekonomen is reaching new
customer groups. The original-service price guarantee, which was
launched in Sweden in July, was successful and sales in affiliated
workshops increased significantly.

Mekonomen Norway reported an EBIT margin of 17 per cent (20) and sales
rose 5 per cent. The focus on the Mekonomen concept continued with
undiminished capacity and a partner agreement was signed with LeasePlan
in Norway during the quarter, entailing a breakthrough for Mekonomen
Fleet in the Norwegian market.

EBIT for Sørensen og Balchen amounted to SEK 25 M during the third
quarter. The EBIT margin was 13 per cent and the success of the
integration work continued. Sørensen og Balchen is driven as an
independent group within Mekonomen, with its own brand and store
concept, a model that is key to ensuring continued success in the
market.

At the marine market, after the end of the period, Mekonomen signed an
agreement with Huges Marina that includes operating four stores and
deliveries of spare parts and accessories.

After the end of the period, Mekonomen signed an agreement to acquire
Meca, which has 66 proprietary stores, 24 franchise stores and 482
partner workshops in Sweden and Norway. Meca's sales forecast for the
full-year 2011 amounted to approximately SEK 1,500 M and an operating
profit of about SEK 180 M. Annual synergies, as a direct result of the
acquisition, are estimated at SEK 80 M from 2013. Meca will be operated
as an independent group within Mekonomen, with its own brand and
concept. The transaction means that combined, we will be stronger,
although we are still small compared with the multinational automotive
spare-parts players. The acquisition is conditional upon approval from
the Norwegian and Swedish Competition Authorities.

Costs for the prioritised areas, new Mega units, the establishment in
Finland, the marine venture, proprietary workshops, as well as the
integration of Sørensen og Balchen, amounted to a total of SEK 10 M
during the third quarter. Costs for these long-term ventures will also
impact earnings during the fourth quarter by approximately SEK 10 M. In
addition, it is estimated that non-recurring costs in connection with
the acquisition of Meca will impact earnings during the fourth quarter
by a further SEK 20 M.

It is essential that we participate in the consolidation of our industry
to face competition from international and brand dependent operators. We
have a stable underlying business, with Denmark also reporting a
satisfactory EBIT margin, and the integration work with Sørensen og
Balchen has exceeded our expectations. With our strong concept, we make
CarLife easier for our customers and Mekonomen will remain the winner in
a slightly weaker overall market.

Håkan Lundstedt, President and CEO

For further information, please contact:
Håkan Lundstedt, President and CEO Mekonomen AB, Tel: +46 (0)8-464 00 00
Gunilla Spongh, CFO Mekonomen AB, Tel: +46 (0)8-464 00 00

The information in this interim report is such that Mekonomen is
obligated to publish in accordance with the Securities Market Act.
The information was submitted for publication on 9 November 2011.

Mekonomen makes CarLife easier through a wide and easily accessible
range of inexpensive and innovative solutions and products for consumers
and companies. We are the leading automotive spare-parts chain in the
Nordic region, with proprietary wholesale operations, more than 300
stores and more than 1,600 workshops operating under the Mekonomen
brand.