Year - End Report for Duni AB (publ) 1 January – 31 December 2014

Full year operating margin in excess of 11%

1 October – 31 December 2014

  • Net sales amounted to SEK 1,211 m (1,102). Adjusted for exchange rate changes, net sales increased by 5.8 %.
  • Earnings per share, after dilution amounted to SEK 2.31 (2.25).
  • Operating income improved within all business areas except New Markets, which was negatively affected by Russia.
  • Continued positive cash flow contributes to a strengthened balance sheet.

1 January – 31 December 2014

  • Net sales amounted to SEK 4,249 m (3,803). Adjusted for exchange rate changes, net sales increased by 7.5 %.
  • Organic growth in core business, currency-adjusted net sales excluding acquisitions and hygiene product operations increase by 3.9%.
  • Operating margin exceeds 11% for the first time.
  • Earnings per share, after dilution amounted to SEK 6.80 (5.68).
  • Acquisition of Paper+Design, which is reported within the Consumer business area as from the middle of June.
  • The Board proposes a dividend of SEK 4.50 (4.00) per share.

Key financials

SEK m 3 months
October-
December
2014
3 months
October-
December
2013
12 months
January-
December
2014
12 months
January-
December
2013
Net sales 1 211 1 102 4 249 3 803
Operating income1) 169 152 475 385
Operating margin1) 14.0 % 13.8 % 11.2 % 10.1 %
Income after financial items 152 138 437 350
Net income 109 106 319 267

1)       For bridge to EBIT, see the section entitled “Operating income - Non-recurring items”.

CEO’s comments

“The concluding quarter of the year follows the trend from earlier quarters, with growth and higher earnings compared with last year. The increase in sales totaling SEK 109 m was positively affected by currency movements and acquisitions, but should also be viewed in light of growing uncertainty in the world around us. Net invoicing for the period was SEK 1,211 m (1,102) and operating profit increased to SEK 169 m (152). The operating margin strengthened to 14.0% (13.8%).

For the year as a whole, sales increased by 7.5% in comparable currencies. Net sales amounted to SEK 4,249 m (3,803) and the operating margin strengthened to 11.2% (10.1%). Excluding currency and structuring effects, organic growth was approximately 4%. The fourth quarter began somewhat weaker in terms of sales, but ended with growth well in line with previous quarters. During the past two quarters, we have witnessed increased uncertainty in the world around us. The turbulence in and around Russia has a direct impact on our Russian operations, and also had a tempering effect on other markets. In addition, delivery capability to customers has stabilized and, during the quarter, we reached a satisfactory level on all markets. The logistics disruptions reported previously have now been completely resolved.

The Table Top business area increased sales to SEK 604 m (576), with an operating income of SEK 126 m (116). Following a weak start, the quarter ended significantly stronger thanks, among other things, to an attractive Christmas collection. All in all, the business area grew by 0.3% at fixed exchange rates. Southern Europe and the UK demonstrated strong local growth, while Eastern and Central Europe showed a slight downturn.

Meal Service’s growth is continuing to outstrip the market. During the quarter, sales increased to SEK 144 m (132) and operating income increased to SEK 6 m (4). Meal Service is benefiting from an expanding catering and take-away market, with successful investments in concept and product development leading to increases in our market shares.

The Consumer business area grew by 39% in the quarter, with the growth mainly generated by the acquisition of Paper+Design. Sales increased to SEK 322 m (220) and the operating income was SEK 32 m (27). The takeover of Paper+Design is now fully completed and focus is now being placed on further efficiency improvements in the cooperation between the companies. During the second half of 2014, a synergy program was initiated affecting, among other things, purchasing, product range and administration.

New Markets was affected by the turbulence in Russia, with the weakened ruble leading, among other things, to a sharp increase in the Russian company’s purchasing costs. The market situation is being assessed regularly and further measures ― in addition to the price increases to customers already initiated ― cannot be ruled out. The business area’s sales amounted to SEK 54 m (56) and operating income declined to SEK 0 m (3).

Within Materials & Services, we are following the previously announced phase out plan. Manufacture of hygiene products will be discontinued after the first quarter of 2015, and production in Dals Långed will thereafter be transferred to the unit in Skåpafors. The business area’s sales in the quarter fell to SEK 87 m (118), at the same time as operating income increased to SEK 6 m (2).

During 2014, we have implemented a series of important changes which make us well prepared for 2015. At the same time, we are witnessing increased instability in the world around us, which can affect both purchasing power and the desire to consume,” says Thomas Gustafsson, President and CEO, Duni.

Additional information is provided by:

Thomas Gustafsson, President and CEO, +46 40 10 62 00
Mats Lindroth, CFO, +46 40 10 62 00
Tina Andersson, Corporate Marketing & Communication Director, +46 734 19 62 24


Duni is a leading supplier of attractive and convenient products for table setting and take-away. The Duni brand is sold in more than 40 markets and enjoys a number one position in Central and Northern Europe. Duni has some 2,100 employees in 18 countries, headquarters in Malmö and production units in Sweden, Germany and Poland. Duni is listed on NASDAQ Stockholm under the ticker name “DUNI”. ISIN-code is SE 0000616716.
www.duni.com 

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Duni is a leading supplier of attractive and convenient products for table setting and takeaway. The Duni brand is sold in more than 40 markets and enjoys a number one position in Central and Northern Europe. Duni has some 2,400 employees in 23 countries, headquarters in Malmö and production units in Sweden, Germany, Poland, New Zealand and Thailand. Duni is listed on NASDAQ Stockholm under the ticker name “DUNI”. ISIN-code is SE 0000616716.

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For the year as a whole, sales increased by 7.5% and the operating margin strengthened to 11.2%.
Thomas Gustafsson, President and CEO, Duni AB