Interim report 1 January–30 September 2008
Cost-cutting pays off
Third quarter (1 July–30 September 2008)
• Consolidated net sales for the period reached SEK 63.3 million (55.0).
• The operating loss for the period was SEK 4.1 million (28.4). The loss after tax was SEK 5.0 million (21.6), equal to earnings per share of SEK -0.09 (-1.27). The Group’s composition profit for the period was SEK 2.6 million.
• The Group’s indirect expenses during the period amounted to SEK 24.0 million (53.2).
• Net sales rose by SEK 8.3 million and indirect expenses decreased by SEK 12 million compared to Q2.
• Current liabilities fell by a full SEK 19 million compared to Q2, mainly through continued liquidation of the inventories attributable to wholesale operations which are currently being wound up.
• At the end of the period the Group had cash and cash equivalents, including unutilised bank overdraft facilities, of SEK 28.0 million and an equity/assets ratio of 36.7%.
1 January–30 September 2008
• Consolidated net sales for the period totalled SEK 173.7 million (202.0).
• The operating loss for the period was SEK 24.4 million (46.7). The loss after tax was SEK 27.8 million (35.7), equal to earnings per share of SEK –0.76 (-2.21). The Group’s composition profit for the period was SEK 16.5 million.
Comments from the CEO:
Without a doubt, I can say that VKG is on the right path. Aside from the impact of wind-up costs in the wholesale operations on profit for the period, the third quarter brought a tangible turnaround with positive earnings for the month of September. This is also proof that our cost-cutting measures have been highly successful.
As the new President and CEO of VKG, I have spent my first two months working intensively to launch and begin the realisation of a new strategy according to the focus that was established and communicated during the reconstruction phase this spring. The Group’s wholesale operations are being discontinued and the installation business strengthened and developed to make VKG a total provider of energy services whose market position and profitability are determined entirely by our ability to create and deliver customer values.
The wind-up of our wholesale business is proceeding according to plan, which is clearly demonstrated by our figures for the period. The dramatic reduction in costs has resulted in a steady improvement in earnings.
In the large and growing market for system solutions and services that optimise energy usage, improve the indoor climate and reduce environmental impact is large and growing, there are enormous opportunities for companies with expertise in energy engineering, building technical systems and their operation and maintenance. VKG already has the right profile, but needs to reinforce business-critical expertise in areas such as energy analysis, operating technology and control & monitoring.
For this reason, among others, we conducted discussions with a number of potential acquisitions during Q3 and in early October were delighted to present the candidate that topped our wish list as a new member of the VKG Group: VVS-Specialisten i Södertälje Holding AB with its subsidiaries VVS-specialisten and Energi & Driftkonsult. The acquired group will be consolidated in VKG as of 1 October. With this acquisition we have advanced from words to action. Not only does VVS-specialisten have an excellent order book, healthy profitability and a financial position far above the average for comparable companies, but both its management and personnel have expressed a strong interest in developing and expanding as an important part of the VKG Group. The acquisition has given VKG valuable expertise that will further enhance our attractiveness in the market for energy saving solutions.
In spite of this progress, we are not finished building the future VKG and must continue focusing on cost-efficiency, selective acquisitions and intensive market development.
For more information about the interim report, contact:
President & CEO
Mobile +46 (0)70-274 77 26
Mobile +46 (0)76-826 66 15
Värmekyl Grossisten Scandinavia AB (publ) is one of Sweden’s leading providers of environmental technology solutions with a focus on energy efficiency and improved indoor climate in commercial, multidwelling, industrial, residential and holiday properties. The VKG share is quoted on the First North marketplace of the OMX Nordic Exchange Stockholm. The company’s Certified Adviser is Mangold Fondkommission AB. For more information visit www.vkg.se