Cabonline publish Interim report for the period January to March 2020

JANUARY-MARCH

• Revenue amounted to MSEK 1,410 (1,499), a decrease of 6%. Organically, revenue fell 13.8%.
• Adjusted EBITA was MSEK 44 (61) and the corresponding margin was 3.1% (4.1).
• Operating profit amounted to MSEK -10 (9) including items affecting comparability of MSEK -19 (-20).
• Net loss for the period was MSEK -49 (-11).
• Earnings per share before and after dilution were SEK -1.73 (-0.66).
• Cash flow for the period was MSEK -37 (-9).

OUTLOOK AND EVENTS AFTER THE REPORTING PERIOD

• Cabonline Group, and its transporters, have seen a clear decrease of taxi journeys as a result of actions implemented, in order to limit the spread and the effects of the Covid-19 virus in the Nordic countries. This has had far-reaching effects on people´s need for mobility as numerous restrictions have been introduced. Demand for taxi services including transportation for elderly and people with physical disabilities, as well as school transportation have decreased noticeably in March and into the second quarter.
• Cabonline has taken measures early on to adapt operations to the current market, focusing on preserving liquidity by reducing costs, moving forward investments, and utilizing public support packages.
• New business opportunities have been identified for transporters, such as home delivery of groceries, medicine, and passenger transports within healthcare.
• Due to the reduced demand that is a consequence of the Covid-19 pandemic, Cabonline may not be able to meet the level of certain bond terms in the coming quarters and has thus started a negotiation with the bondholders.

CEO´S COMMENT

Cabonline opened the year strong, with revenues for January and February 9 percent better compared to the same period previous year. In the beginning of 2020, we were awarded several new contracts, such as school transports for the municipality of Jönköping during a four-year term and a supplementary two-year term contract for Västtrafik. We also got renewed confidence in carrying out school transports in Västernorrland during a four-year term. It is also positive that we, after a long process of review in the courts, finally were awarded a contract for school transports for The National Agency for Special Needs Education and Schools, and Östervångsskolan, an agreement with an option to be renewed.

In March, the taxi industry was hit hard and fast by Covid-19, just like the rest of society. The recommendations from the authorities to reduce the spread of the virus have had a major impact on the transport industry with reduced international travel by air due to the close-down of many countries in Europe and the rest of the world. About 10 per cent of all taxi rides goes to and from airports.

The governments in Sweden, Norway, Finland, and Denmark took various measures to reduce the spread of Covid-19, with closed communities as a result. Given that nearly half of Cabonline’s revenue is related to publicly procured transports (B2P); travel service, school transfers and disability transports, the company is in less affected by the close-down than its competitors in the taxi industry. We have found solutions to maintain our capacity in public transports after close dialogue with our customers in municipalities and regions. For example, the Stockholm region has compensated the company for cancelled wheelchair transports to ensure the capacity going forward when the society open. This is a clear example of how taxi transportation play an important role as an extension of the public transportation system. Sweden's somewhat more open approach to fight the virus, compared to the total lock-down in the other Nordic countries, has meant that we have had more vehicles in traffic compared to other Nordic countries. Even so, the demand within our business travel and consumer segments has fallen drastically. At the same time, support packages for companies in Norway and Denmark was implemented earlier than I Sweden and have been more powerful, which mitigates the impact of the close-down on business in these countries.

We understood at an early stage that the pandemic would have a major impact and consequences for the transport industry and accordingly, took rapid measures to ensure liquidity and financial stability in the company. Cabonline has used the states’ layoff support programs and implemented cost savings programs immediately. Development initiatives which require large investments have been put on hold until we have a better overview of how the market develops. Cost awareness prevails in the Group.

In parallel with the reduced demand for travel, we have found new business opportunities in close cooperation with municipalities, regions, and the business community. This mean we transport healthcare professionals, deliver everything from fast food and flowers to medicines and tests in healthcare. These transports do not compensate for the missing traffic but helps to keep up the volume. We will most certainly keep and develop several of the initiatives we have implemented even after the travel picks up.

Our transporters are heavily impacted by the Covid-19 crisis and to provide support, Cabonline has offered to postpone the payment of parts of the fixed fee in March and April. This is a way to maintain a well-functioning and established fleet of transporters. Given that no one know how long the crisis will continue, support packages from the Governments to the taxi industry is critical to ensure endurance.

We may have reached the lowest level of trips as we have noted a cautious recovery in the end of April. Meanwhile, we take the opportunity to implement changes and initiatives have been taken to further enhance the quality and collaboration within the Group, for example that we co-ordinate our customer support function by moving the operations in Lund to Sundbyberg.

The efforts of all employees, our measures to improve cost efficiency and the fact that a large part of our business is based on procured assignments critical to society means that our basic core business remains stable. Out of crisis, creativity is born, and I am convinced that all our work in recent months will allow us to emerge from this turbulent time as a better, stronger, and more efficient Cabonline.

For further information, please contact:
Peter Viinapuu, CEO, tel. +46 76 641 10 06, peter.viinapuu@cabonbline.com
Anneli Lindblom, CFO, tel. +46 76 593 84 00, anneli.lindblom@cabonline.com

About Cabonline:
Cabonline is the leading taxi company in the Nordic region with 3,000 connected taxi firms and approximately 5,700 vehicles in Sweden, Norway, Finland and Denmark. Cabonline contains a series of well-known brands, such as TaxiKurir, Norgestaxi, TOPCAB, Kovanen, Taxi Skåne, Taxi Väst, Umeå Taxi, Sverigetaxi and Taxi 4x27. Through Cabonline, taxi firms have access to attractive customer agreements, support from industry-leading technological development and utilization of economies of scale, efficient service and a shared infrastructure. The Group has revenue of approximately SEK 6.5 billion and performs about 45,000 journeys per day. For further information: www.cabonlinegroup.com.