Interim Report - 9 Months 1 April-31 December 2017

Third quarter (1 October-31 December 2017)

•  Revenue increased by 5 percent to MSEK 1,486 (1,419).
• Operating profit totalled MSEK 76 (34). Adjusted operating profit (excluding items affecting comparability) rose by 73 percent to MSEK 76 (44), corresponding to an adjusted operating margin of 5.1 percent (3.1).
• The return on working capital (P/WC) for the most recent 12-month period was 24 percent (21).
• Profit after financial items increased by 139 percent to MSEK 74 (31).
• Net profit rose by 152 percent to MSEK 58 (23), corresponding to earnings per share of SEK 2.05 (0.80).
• The operational net loan liability amounted to MSEK 256 (229) and the equity/assets ratio at the end of the quarter was 41 percent (37).
• In mid-October 2017, TOOLS Sweden acquired the remaining 70 percent of the shares in the former associated company AB Knut Sehlins Industrivaruhus, which thus became a wholly owned subsidiary. Sehlins is a leading industrial reseller in Örnsköldsvik and generates annual revenue of approximately MSEK 40.

Reporting period (1 April-31 December 2017)

• Revenue increased by 4 percent to MSEK 4,179 (4,011).
• Operating profit totalled MSEK 180 (135). Adjusted operating profit (excluding items affecting comparability) rose by 32 percent to MSEK 191 (145), corresponding to an adjusted operating margin of 4.6 percent (3.6).
• Profit after financial items rose by 38 percent to MSEK 175 (127).
• Net profit increased by 39 percent to MSEK 136 (98).

PRESIDENT'S STATEMENT

Increased sales and healthy earnings growth
The development of Momentum Group continued, with a high activity level, increased revenue and healthy earnings growth in the third quarter of the financial year. The business climate in our main markets in the Nordic region remains favourable, particularly in the industrial sector which is our primary customer segment. Although growth in the construction sector has slowed somewhat in recent quarters, this segment accounts for a smaller share of our total revenue. Most of our units improved their operating profit in the first nine months of the financial year.

Business area Tools & Consumables
In this business area, TOOLS Finland's sales trend remained favourable and revenue in TOOLS Norway stabilised further. Over the year to date, we have seen a gradual increase in our sales volume to focus customers in TOOLS Sweden, despite the closure of 15 less profitable sales units in 2017. The decline in sales to store customers due to these closures was in line with our plans and expectations.

It was particularly gratifying to see that the measures implemented in TOOLS Sweden continued to generate earnings improvements according to plan and that earnings in TOOLS Norway gradually recovered toward the end of the year. TOOLS Finland and our niche companies Mercus and TriffiQ continued to improve and delivered strong profitability levels for the reporting period.

Business area Components & Services
The sales trend in Momentum Industrial remained positive for both components and services and the earnings performance continued to be favourable. Gigant's earnings gradually recovered toward the end of the year and its volumes were on par with the previous year. During the third quarter, Gigant established a new manufacturing company together with its largest supplier, which is expected to have a positive impact on efficiency and result in lower costs in the operations.

Continued positive performance as an independent company
Combined with a positive underlying market, the improvement efforts carried out in the Group in 2017/18 have helped to strengthen our earnings performance. We are also continuously analysing attractive acquisition candidates in the Nordic region that are leaders in their market niches and have a high level of knowledge and/or technological content. We are continuing our established path and develop our various companies with a constant focus on being "better than yesterday".

Stockholm, February 2018

Ulf Lilius
President & CEO

Presentation of the Interim Report - 9 months 2017/18
Investors, analysts and media are welcome to participate in a webcast conference call in which CEO & President Ulf Lilius and CFO Niklas Enmark will present the Interim Report and answer any subsequent questions. The presentation will be held in English.

Time: Friday, 9 February 2018 at 11:00 a.m. CET.
Web link: www.financialhearings.com/event/10538.
Telephone no: SE +46 8 503 365 62 / UK +44 20 3008 9816 / US +1 85 5831 5948

Contact information

Ulf Lilius, President & CEO, Tel: +46 10 454 54 70
Mats Karlqvist, Head of Investor Relations, Tel: +46 70 660 31 32 

The information in this report is such that Momentum Group AB (publ) 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 above, at 8:00 a.m. CET on 9 February 2018.
   This document is in all respects a translation of the Swedish original Interim Report. In the event of any differences between this translation and the Swedish original, the latter shall prevail.

Momentum Group is one of the leading resellers of industrial consumables and components, services and maintenance to professional end users in the industrial and construction sectors in the Nordic region. The Group has annual revenue of approximately SEK 5.5 billion and approximately 1,600 employees. Momentum Group AB (publ) is listed on Nasdaq Stockholm since June 2017. Read more at www.momentum.group. 

 Read the complete report here