Interim report

Orders received SEK 7,366 m. (SEK 6,594 m.), up 12% Invoiced sales rose 13% to SEK 6,985 m. (SEK 6,203 m.) Income after net financial items +16 %, SEK 433 m. (SEK 372 m.) Financial summary July - January - October - September September September Full- SEK m. 3 months 9 months 12 months year moving 1999 1998 1999 1998 1999 1998 1998 Orders received 2,543 2,203 7,366 6,594 9,696 8,698 8,924 Net sales 2,215 2,082 6,985 6,203 9,620 8,373 8,838 EBITDA 1) 240 233 730 658 1,028 918 956 Operating 133 135 421 386 611 537 576 income Income after net financial 135 125 433 372 605 515 544 items 1) EBITDA = Earnings Before Interest, Tax, Depreciation and Amortisation of intangible assets 2) Market development The global market for warehouse trucks continued to develop positively. In North America, demand was strong, with market growth primarily in the segment small trucks, so-called walkies. The Western European market also noted growth, again with an emphasis on the small truck segment. Outside Western Europe and North America, market development is more mixed, and total volume has remained largely unchanged. Growth is being reported in South America and parts of Asia and Eastern Europe, while other parts of Asia and Eastern Europe continue to weaken. Acquisitions On July 1 BT acquired 51% of the shares of SOUEL Warehousing S.A. of Greece. SOUEL was consolidated as a subsidiary as of July 1. The impact on income is negligible. In March BT acquired 45% of the shares of CESAB Carrelli Elevatori S.p.A., Italy's second largest manufacturer of counterbalance trucks. The acquisition, which is considered strategic, brings an important complement to BT's product range with counterbalance trucks marketed under the BT name. CESAB was consolidated as an associated company as of March 1999. The positive income accounts for part of the increase in income in associated companies. Orders and invoiced sales The Group's orders received after three quarters amounted to SEK 7,366 m. (SEK 6,594 m.), an increase of approximately 12% compared with the corresponding period last year. The order rate has gradually risen during the year. Net sales amounted to SEK 6,985 m. (SEK 6,203 m.), an increase of 13% compared with the corresponding nine-month period of 1998. The order backlog grew by approximately SEK 380 m. during the first nine months. This is a seasonally normal build-up in anticipation of the usually high delivery rate in the last quarter of the year.Net sales for the first nine months of 1999 and 1998 by product area were as follows: January-September Change Amounts in SEK m. 1999 1998 % Warehouse trucks 3,557 3,267 + 9% Counterbalance trucks 619 423 + 46% Manual trucks 324 304 + 7% Total, trucks 4,500 3,994 + 13% - % of total 64% 64% Spare parts 1,066 948 + 12% Service 754 695 + 8% Short-term rentals 340 288 + 18% Other areas 325 278 + 17% Total, service market 2,485 2,209 + 12% - % of total 36% 36% Net sales 6,985 6,203 + 13% The third-quarter sales increase was higher in the service market than in truck sales. This is because service market activities are less affected than production and product deliveries by the vacation period that falls during the quarter. BT's service operations account for approximately one third of the Group's total sales. Of the gross income of SEK 2,041 m., approximately half consists of income from the service market. Income The Group's EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation of intangible assets) rose by 11% to SEK 730 m. (SEK 658 m.). Net financial items, including income from long-term rentals/leasing, amounted to SEK 12 m. (SEK -14 m.) after nine months. Continued growth in long-term rentals/leasing boosted the interest net to SEK 98 m., against SEK 82 m. in the corresponding period of 1998. Income after net financial items amounted to SEK 433 m. (SEK 372 m.), an increase of 16%. Net income, after tax, was SEK 251 m. (SEK 215 m.). Earnings per share amounted to SEK 8.95 after nine months, against SEK 7.70 for the corresponding period last year. Capital expenditures The Group's total net capital expenditures for fixed assets amounted to SEK 230 m., compared with SEK 311 m. last year. Of this total, approximately half was attributable to the short-term rental fleet. Financing and liquidity The Group's total assets rose to SEK 8,447 m., against SEK 8,128 m. at the beginning of the year, while net borrowings amounted to SEK 1,858 m., compared with SEK 2,119 m. at year-end 1998. The net gearing ratio thus amounted to 84%, against 104% at the end of last year. The equity ratio amounted to 26.3%, against 25.0% at the beginning of the year. The year's positive cash flow trend continued during the third quarter. Since the beginning of the year cash flow amounts to SEK 209 m., compared with a negative cash flow of SEK -399 m. for the corresponding period last year. The positive cash flow trend is a result of programs introduced in 1998 to free up operating capital. The new financing solution for leased trucks launched in the U.S. earlier in the year has contributed as well. Personnel The number of employees as of September 30 was 7,246, compared with 6,975 at year-end 1998. BT's business areas BT's operations are organised into three business areas. In addition, BT has central, Group-wide resources for, among other things, management, accounting, finance, IT and public relations. BT EUROPE business area BT EUROPE business area Primarily covering Western Europe. Jan.-Sept. Full-year SEK m. 1999 1998 1998 Orders received 3,743 3,598 4,846 Net sales 3,542 3,358 4,845 Income 1) 289 315 445 Operating margin, % 2) 8.2% 9.4% 9.2% No. of employees 3,916 3,734 3,799 Demand for warehouse trucks has increased during the year. The increase is most apparent in the segment for small trucks. The order rate has risen gradually in 1999, while BT has maintained essentially an unchanged market share. BT's counterbalance range, manufactured by CESAB, has now been launched in a number of markets. Interest from the market has been great and deliveries begin in the fourth quarter. In August BT presented the new REFLEX M series of trucks designed for new areas of application. Customer deliveries begin early next year. Sales rose by 5% compared with the corresponding period last year. The delivery rate from the truck plant in Mjölby has gradually increased since the summer. The delivery rate for manual trucks was lower than normal in the third quarter due to the introduction of a new robotic welding line. Delivery capacity is expected to be back on a normal level during the fourth quarter of 1999. The production of a range of small truck models for Toyota in the European market is progressing according to plan. The operating margin is approximately one percentage point lower thus far this year than the corresponding period of 1998. This is mainly due to lower gross margins on truck sales and higher expenses for resources to improve market coverage and for the implementation of the new business support system in the European organisation. BT RAYMOND business area BT RAYMOND business area Primarily covering North America. Jan.-Sept. Full-year SEK m. 1999 1998 1998 Orders received 3,506 2,968 4,031 Net sales 3,316 2,818 3,914 Income 1) 312 236 322 Operating margin, % 2) 9.4% 8.4% 8.2% No. of employees 2,945 2,827 2,861 Demand in North America has continued to develop positively. BT RAYMOND has been able to further strengthen its position in the market and increased its market shares in a number of product segments. The launch of new truck models and improved market penetration have contributed to this. The business area's sales rose by 18% to SEK 3,316 m. Income rose by 32% to SEK 312 m. compared with the previous year. The improvement in operating margin compared with the corresponding period of 1998 is the result of positive volume and synergy effects as well as productivity improvements. Price competition remains intense in many product areas, however. BT INTERNATIONAL business area BT INTERNATIONAL business area Markets outside North America and Western Europe. Jan.-Sept. Full-year SEK m. 1999 1998 1998 Orders received 492 406 584 Net sales 486 378 569 Income 1) 10 32 29 Operating margin, % 2) 2.1% 8.4% 5.1% No. of employees 341 248 274 Markets outside Western Europe and North America as a whole are reporting only low growth. Sales for BT INTERNATIONAL rose by 29%, primarily due to the effects of the acquisition of MHC in the spring of 1998. The income trend has not been satisfactory, mainly because of developments in certain areas of Eastern Europe. The competitive situation in periodically shrinking markets is resulting in strong price pressure and, as a result, low margins. 1) Income = operating income + income from long-term rentals/leasing. Amortisation of goodwill at the Group level is not charged against individual business areas. 2) For definition see note 2 on page 7. REPORTS IN YEAR 2000 from BT INDUSTRIES AB Annual Accounts February 14 Annual Report 1999 mid-March Interim Report, January-MarchApril 17 Annual General MeetingApril 17 Interim Report, January-JuneJuly 19 Interim Report, January-September October 17 Information can be ordered from BT Industries AB, Public Relations, telephone +46-142 - 86 000 www.bt-industries.com Mjölby, October 19, 1999 Carl-Erik Ridderstråle President and CEO For further information, please contact: Carl-Erik Ridderstråle, CEO Per Zaunders, CFO Phone: +46-142-86 000 ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/10/19/19991019BIT00240/bit0001.doc The full report http://www.bit.se/bitonline/1999/10/19/19991019BIT00240/bit0002.pdf The full report