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.
- 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.
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.