Bygghemma Group Interim report 1 January-30 September 2018

CONTINUED STRONG SALES GROWTH DESPITE CHALLENGING CONDITIONS

HIGHLIGHTS

Third quarter

  • Net sales rose 11.1 percent to SEK 1,251.1 million (1,126.2), of which organic growth accounted for 8.6 percent, driven by organic growth of 14.1 percent in the DIY segment
  • Adjusted gross profit* rose 4.1 percent to SEK 256.4 million (246.4), with an adjusted gross margin of 20.5 percent (21.9)
  • Adjusted EBITA** (operating income before acquisition-related amortisations and write-downs, and items affecting comparability) amounted to SEK 40.0 million (60.5), with an adjusted EBITA margin of 3.2 percent (5.4)
  • Higher raw material prices, weakened SEK (against the EUR and USD) and challenging weather conditions impacted EBITA in an amount of approximately SEK -25 million
  • Operating income adjusted for items affecting comparability decreased to SEK 30.6 million (52.0), with an adjusted operating margin of 2.4 percent (4.6)
  • Operating cash flow*** was SEK -43.9 million (37.0), driven by seasonal effects
  • Net income amounted to SEK 24.2 million (17.3)
  • Earnings per share amounted to SEK 0.23 (-0.80) before dilution and SEK 0.23 (-0.80) after dilution

1 January-30 September

  • Net sales rose 28.4 percent to SEK 3,694.0 million (2,875.9), of which the Group's organic growth accounted for 14.2 percent, driven by organic growth of 18.8 percent in the DIY segment
  • Adjusted gross profit* increased 27.2 percent to SEK 775.6 million (609.5), with an adjusted gross margin of 21.0 percent (21.2)
  • Adjusted EBITA** amounted to SEK 142.4 million (144.3), with an adjusted EBITA margin of 3.9 percent (5.0)
  • Operating income adjusted for items affecting comparability, among other attributable to the company's IPO, amounted to SEK 114.4 million (121.5), with an adjusted operating margin of 3.1 percent (4.2)
  • Operating cash flow*** was SEK 177.9 million (184.5), corresponding to a cash conversion of 109 percent (117), in line with the Group’s financial targets
  • Net income amounted to SEK 1.3 million (36.9). The negative result was related to items affecting comparability
  • Earnings per share amounted to SEK -0.53 (-2.65) before dilution and SEK -0.53 (-2.65) after dilution

Key events during and after the period

  • Acquisition of 30 percent of Furniture1, the leading online home furnishings retailer in the Baltics and Eastern Europe  Acquisition of Edututor, a leading Finnish online retailer in grills, LED lightning and kitchen products   Announced the establishment of a proprietary distribution network in Sweden and completed the Furniturebox-integration
      

* Adjusted for items affecting comparability (refer to “Relevant reconciliations of non-IFRS alternative performance measures (APM)”). Items affecting comparability impacting gross profit amounted to SEK 11.7 million (11.5) for the quarter and SEK 26.3 million (23.8) for the first nine months and were attributable to the Furniturebox integration and warehouse move. Items affecting comparability impacting EBITA totaled SEK 13.3 million (15.7) for the quarter and SEK 71.3 (35.3) for the first nine months and were attributable to (i) acquisition costs of SEK 0.7 million (1.8) for the quarter and SEK 1.7 million (8.6) for the first nine months, (ii) integration costs and costs related to the warehouse move of SEK 12.5 million (13.5) for the quarter and SEK 27.5 million (26.3) for the first nine months, (iii) costs of SEK 11.4 million (-) for the first nine months associated with the long-term incentive program launched in connection with the IPO and (iv) costs for the listing on Nasdaq of SEK 30.7 million (0.4).
** Adjusted EBITA is defined as operating income before depreciation and amortisation related to acquisitions and total items affecting comparability (described above).
*** Operating cash flow: Adjusted EBITDA including changes in working capital less investments in other non-current assets in the period. Cash conversion in percent: Operating cash flow / adjusted EBITDA (also refer to “Definitions” on page 32 in this report).
  

This information is information that Bygghemma Group First AB 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 below, at 07.00 CET on 29 October 2018.
   

Teleconference in connection with publication of the quarterly report
On Monday 29 October at 10:00 a.m. CET, Mikael Olander, President and CEO and Martin Edblad, CFO, will hold a conference call for the publication of the quarterly report. The call will be held in English. To participate, please call the following number: +46 (0) 8 566 426 91 or go to the weblink https://tv.streamfabriken.com/bygghemma-group-q3-2018. The presentation is available at Bygghemma Group’s website: http://www.bygghemmagroup.com/investor-relations/presentations.

Contact information
For further information, visit www.bygghemmagroup.se or contact:

Mikael Olander, President and CEO Martin Edblad, CFO
mikael.olander@bygghemmagroup.se  martin.edblad@bygghemmagroup.se 
+46 (0)708-19 43 00 +46 (0)734-24 68 51
          
Johan Hähnel, Head of Investor Relations 
ir@bygghemmagroup.se 
+46 (0)70-605 63 34

About Bygghemma Group
Bygghemma Group is the leading online supplier of home improvement products in the Nordic region. We offer our customers a broad product range at attractive prices, with convenient home delivery. We conduct operations in two segments: DIY and Home Furnishing. DIY comprises sales of products from well-known brands for homes and gardens, and Home Furnishing comprises sales of furniture and home decor, mainly under proprietary brands. Bygghemma Group includes a wide range of web-stores, such as Bygghemma, Trademax, Chilli and Furniturebox. Bygghemma Group had sales of SEK 4.0 billion in 2017, has its head office in Malmö and is listed on Nasdaq Stockholm Mid Cap.

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