Strongest Interim Report results ever

[ I N T E R I M R E P O R T ] JAN - JUN 2000 Strongest interim results ever * Consolidated profit after financial items amounted to SEK 2,403M (286) * Profit per share amounted to SEK 18.05 (1.45) * Net asset value increased by 54 per cent during the period to SEK 97 (48) per share * Bure Health Care - name under change to Capio - improved its operating profit before goodwill by 52 per cent to SEK 90M (59). Operating margin amounted to 5.3 per cent (5.6) * Dimension's strong growth and high profitability continues. Operating profit before goodwill depreciation rose to SEK 50M (33) and at the same time organic growth amounted to 100 per cent * The Parent Company carried out investments in 20 companies to the value of SEK 724M * Three stockmarket listings planned during the autumn After the end of the reporting period: * Investment AB Bure changes its name to Bure Equity AB, decision by Extraordinary General Meeting on 17 August 2000 * Bure's concentration continues - capital gain of SEK 332M on sale of remaining shares in Gunnebo. Bure January-June 2000 Group review Consolidated profit after financial items amounted to SEK 2,403M (286). The result includes a refund of SPP funds of SEK 201M. During the second quarter, as in the first, business activity was high and characterised by several large divestments which made visible substantial values and capital gains. Total capital gains during the period amounted SEK 2,384M. In addition, the Parent Company carried out investments and supplementary investments in 20 companies amounting to SEK 724M and decided on participation in investment funds of SEK 400M. In May, Innovationskapital carried out its first divestment, Altitun, which attracted much media attention. Altitun was sold to the American company, ADC Telecommunications. Bure's holding over one and a half years resulted in a capital gain of SEK 202M on an investment of SEK 3M. Payment was received in the form of shares in ADC Telecommunications, which have continued to increase in value. This meant that Bure's holding amounted to the equivalent of approximately SEK 275M on 14 August. During the period, 9 percentage points of the holding in Gunnebo were sold, which generated a capital gain of SEK 76M. Bure owned 21 per cent in Gunnebo thereafter. At the beginning of the year, Bure sold the majority of the Framfab shares that it received on the divestment of Guide Konsult. In total, the Guide/Framfab deal generated capital gains of SEK 1,127M. During spring, 11 percentage points of the holding in Observer was divested, which resulted a capital gain of SEK 447M. During June, Bure sold its entire shareholding in the data distributor AxNet. At the same time the holding in Cygate increased from 62 to 67 per cent. At 30 June, Bure's net asset value amounted to SEK 10,577M, which is equivalent to SEK 97 per share. The net asset value increased by 54 per cent during the period. Of this increase, approximately half is attributable to revaluation of Bure's unlisted holdings. At the period-end, the share price amounted to SEK 66. The growth in share price during the year, including dividend paid to the shareholders, amounted to 19.0 per cent. During the same period, the Findata Yield Index rose by 7.3 per cent. Ahead of the impending distribution to the shareholders and stockmarket, Bure Hälsa och Sjukvård AB will be changing its name to Capio AB (publ). Earnings continue to develop positively with high growth. The average number of employees in the Group amounted to 8,681 (7,805), of whom 31 (26) are employed in the Parent Company. Investment in TIME Bure's strategy is to invest in companies within the TIME sector, i.e. Telecom, Internet, Media and 'Edutainment', with an emphasis on unlisted holdings. The strategy means being involved in growth companies in early phases, partly via funds, as well as large companies in which Bure is able to take a prominent ownership position. The results of the first six months have meant that Bure has significantly strengthened its financial position. At mid-year, the Parent Company had net loans receivable and, with further divestments that are planned to take place during the autumn, significant scope will be created for investments within the TIME sector. In addition, the market decline for companies in the technology sector provides Bure with excellent opportunities for an increased business flow at more attractive valuations. This financial strength, in combination with Bure's networks, forms the foundation which will enable Bure to assume a leading role as an investor in TIME on the private equity market. To define clearly Bure's presence in the private equity sector, the Board of Directors has proposed that the Company will change its name to Bure Equity AB (publ). A decision will be made by an Extraordinary General Meeting on 17 August. Dimension increased its sales by 100 per cent to SEK 670M. Growth is wholly organic and controlled by very high demand for the company's services. Operating profit before goodwill depreciation amounted to SEK 50M (33). Dimension is intended to be listed on the stockmarket during late autumn 2000. CRT is one of the most interesting incubator and high technology companies in Sweden with regard to research within the IT and telecom sector. During the second quarter, Bure increased its ownership in CRT from 49 to 65 per cent. At the same time a decision was made to establish a joint fund with CRT, in which CRT's experience within start-ups and development of high technology company concepts will also be transferred to new external companies. Bure's undertaking in the fund, which will gradually be expanded with additional investors, amounts to SEK 100M. Following its acquisition of the British company, Romeike Group, Observer is the leading company in Europe within media and social environmental monitoring. Observer's strategy is to increase its international presence and as a result strengthen its position as a partner for large international customers. At the beginning of the year 2000, Observer carried out a new share issue totalling SEK 825M, of which Bure accounted for SEK 413M. Sifo Research and Consulting and Sifo Interactive Media were divested during the first quarter which generated capital gains totalling SEK 384M. Bure reduced its ownership in Observer by 11 percentage points during the period. The ownership amounts to 38 per cent of the company which had a market value of SEK 2,534M on 30 June. The companies within the Training and Education operations in Bure are developing positively and total net sales increased to SEK 547M (294). Operating profit before goodwill depreciation amounted to SEK 43M (31). The current annual sales rate is approximately SEK 1,200M. The operating margin amounts to 7.9 per cent in the first six months. Informator Training Group (ITG) continues its investment in the e-learning sector and acquired 20 per cent of the e-learning company Boxer Technologies in Norway during June. Through this acquisition and the collaboration agreement it entered into during the spring with the American company, DigitalThink Inc, ITG has become the most complete provider of web-based interactive training in Sweden. ITG's sales amount to approximately SEK 230M on an annual basis. As the first training and education company in Sweden, Vittra has developed an e-learning concept for compulsory and sixth-form schools. The concept, which involves training by electronic means and operates under the name Vittra's Virtuella Värld, will be launched in the sixth-form of the L'estradska School starting this autumn. Capio to be listed during autumn 2000 Capio is the leading private health care company in the Nordic countries with operations in six countries. Capio has an annual sales rate of approximately SEK 3,300M with high organic growth. Net sales rose by 61 per cent to SEK 1,705M (1,056). Operating profit before goodwill depreciation amounted to SEK 90M (59), equivalent to an operating margin of 5.3 per cent (5.6). In addition, Capio has taken up SEK 144M as income for refund of SPP funds. Capio publishes a separate six-month report. Capio has entered the final phase ahead of its quotation on the O list of the OM Stockholm Exchange which is planned during autumn 2000. In connection with the listing, shares in the company will be distributed to Bure's shareholders. For every two shares in Bure, the shareholders will receive one share in Capio. Parent Company The Parent Company's profit after tax amounted to SEK 1,677M (292) following write-down of share values by SEK 307M. The result includes net capital gains of SEK 1,933M (145). The result was charged with a cost of SEK 12.4M relating to Bure's liability to holders of synthetic options issued during 1997. On 30 June, the Parent Company's equity ratio amounted to 81 per cent (71). At the turn of the year, the equity ratio was 69 per cent. The net of the Company's liquidity reserve - which consists of listed shares, interest-bearing receivables less liabilities - amounted to SEK 234M (-341). In addition the Parent Company had agreed unutilised credit facilities amounting to SEK 1,510M (1,020). Other investments Chematur's net sales amounted to SEK 129M (284) and operating result before goodwill depreciation to SEK -13M (-24). The work of restructuring the company continues and various routes for Chematur's development and ownership are being examined. The Market for Chematur remains weak. Gunnebo, the leading European Group within area protection, continued to develop strongly during the second quarter. Profit after financial items increased by 81 per cent to SEK 134M (74), of which items affecting comparability amounted to SEK 36M (0) net. Bure owned 21 per cent in Gunnebo and the value of Bure's holding amounted to SEK 473M at 30 June. Nobel Biocare increased its net sales by 16 per cent to SEK 999M (860) during the period. Operating profit amounted to SEK 128M (116) On 30 June, the market value of Bure's 15 per cent holding amounted to SEK 734M. Scribona's operating profit amounted to SEK 85M (27), including a refund of SEK 55M from SPP. For the full-year, Scribona estimates that both operating profit before items affecting comparability and profit before taxes will improve compared with the previous year. On 30 June, Bure's ownership amounts to 50 per cent with a market value of SEK 385M. Bure's tax dispute With reference to the 1993 financial year (Tax 94) Bure is involved in a tax dispute regarding whether or not the Company's investment company status was complied with. Bure has won both in the County Administrative Court and the Administrative Court of Appeal. The National Tax Board has appealed against the judgement of the Administrative Court of Appeal to the Supreme Administrative Court. In the 1999 Annual Report, in which this dispute was reported under Contingent liabilities, Bure's costs were estimated at SEK 187M including interest, should the litigation be lost. After the end of the reporting period Change of name Bure's operations are now clearly focused on the private equity market. The Board of Directors has therefore proposed that the Extraordinary General Meeting on 17 August will decide to change the Company's name to Bure Equity AB (publ). Stakeholder programme for Capio AB The Board of Directors proposes that the Extraordinary Meeting on 17 August approve a stakeholder programme for approximately 3,600 employees and Board Members in Capio AB. The stakeholder programme is aimed at increasing the commitment and motivation of the staff and to make Capio more attractive as an employer. Divestment of Essex Within Nordic Capital, Bure's investment has been divested with an exit gain of SEK 25M on an original investment of SEK 16M. Gunnebo world leader Gunnebo has acquired Chubb Safes and thus becomes the world leader within physical security. Bure has sold its remaining holding of 4,238 shares in Gunnebo to international and Swedish institutions. The capital gain amounts to SEK 332M in the Parent Company and SEK 221M in the Group. Net asset value * Net asset value SEK 97 per share on 30 June. * Net asset value increased by 54 per cent during the period. * On 14 August, the net asset value amounted to SEK 94 per share. Bure's net asset value is calculated as follows: For listed holdings the market value is decided at the latest price paid per balance sheet date. This also applies to securities holdings in the Parent Company's financial operations. For unlisted shares the market value has been determined by application of the European Venture Capital Association's (EVCA) valuation recommendations or valuation made by an external party. EVCA's recommendations mean that the market value has been determined on the basis of the value at the latest transaction in the security in which an external party has taken part, for example at the latest new share issue. Other unlisted shares are entered at book value. This applies to Udac, Chematur, Simonsen, Vittra, Vendator, Systeam, Locus Medicus, etc. Bure Finans includes the Parent Company's other securities holdings, in which listed holdings have been entered at market value, and the net of all other assets and liabilities at book value. ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2000/08/17/20000817BIT00560/bit0001.doc The full report http://www.bit.se/bitonline/2000/08/17/20000817BIT00560/bit0002.pdf The full report