Year-end report 2019 Cabonline Group Holding AB (publ)

OCTOBER-DECEMBER 2019

• Revenue amounted to MSEK 1,789 (1,654), anincrease of 8%. Organically, revenue fell 1.1%.
• Operating loss amounted to MSEK -27 (-148) and includes items affecting comparability of MSEK -32 (-15).
• Adjusted EBITA was MSEK 40 (53) and the corresponding margin was 2.3% (3.2).
• Net loss for the period was MSEK -80 (-178).
• Earnings per share before and after dilution were SEK -2.59 (-5.35).
• Cash flow for the period was MSEK 281 (21).
• A new three-year bond loan of MSEK 1,800 was raised and the outstanding loan of MSEK 1,550 was redeemed.
• Miljötaxi in Norway was acquired.
   
• Events after the reporting period
  –    Anneli Lindblom will take office as CFO on 21 February 2020.
  –    The Board proposes no dividend to be paid.

JANUARY-DECEMBER 2019

• Revenue amounted to MSEK 6,490 (6,217), an increase of 4%. Organically, revenue fell 2.9%.
• Operating loss was MSEK -158 (-121). This figure includes a write-down of intangible assets of MSEK -124 (-152) and other items affecting comparability of MSEK -97 (-77).
• Adjusted EBITA was MSEK 202 (239) and the corresponding margin was 3.1% (3.8).
• Net loss for the period was MSEK -259 (-214).
• Earnings per share before and after dilution were SEK -8.66 (-7.38).
• Cash flow for the period was MSEK 270 (-6).
• Taxi 4x27 in Denmark, Taxi Västerås in Sweden and Miljötaxi in Norway were acquired.
• A decision was made to approve a restructuring program including an upgrade of the IT platform, amongst other things.
• Kati Rajala was recruited as CEO for Cabonline Finland.

The Group in brief

 
*APM, see the basis for calculation and definitions on pages 25-30.
*Comparable figures for 2018 have not been changed according to IFRS 16, see Note 1.

CEO’s comments

Acquisitions strengthen our Nordic position
During the year, we continued our journey to become the leading taxi brand in the Nordics. We entered the Danish market through the acquisition of Taxi 4x27, one of the oldest taxi companies in Denmark, with more than 300 cars. We strengthened our presence in the Mälaren region through the acquisition of Taxi Västerås, with 140 cars, and we purchased the Norwegian company Miljötaxi, thereby doubling our fleet in Stavanger.

Downturn in air travel impacting demand
The Group’s revenue declined approximately three percent, organically. The rate of decline was highest in the first half of the year and then slowed in the second half. During the fourth quarter revenues declined organically by one percent, both Sweden and Finland showed positive organic growth. The lack of drivers remains, most notably in Sweden and Finland. Therefore, we accelerate our efforts aiming at keeping and recruiting drivers. We also continued to experience intense pressure from our competitors, mainly in Sweden and Finland and have initiated actions within marketing and product development. A decline in air travel resulted in fewer taxi journeys to and from airports, which impacted demand in both the B2C and B2B segments, which was most clearly seen in Sweden. We are still analyzing the situation in order to take suitable actions.

High quality and service – more public contracts
We can state that we are becoming increasingly competitive and successful in terms of publicly procured contracts. We won some 40 tenders in 2019, one-third of which were brand new contracts. Our major contracts include, for example, wheelchair accessible taxis for the Stockholm region, mobility services in Malmö, service transportation for Region Örebro County, mobility services in Helsinki and school transportation for Brakar, Buskerud in Norway. It is gratifying that we are winning more and more publicly procured contracts thanks to our quality, service and, to a lesser extent, price.

Operations in Finland on the right track
During the year, the Group recognized additional write-down of intellectual property assets attributable to the Finnish operations since the change process is expected to take longer than we previously predicted. The assets referring to Finland are fully written down in the consolidated statements. The new CEO started in June and we are seeing clear progress in the Finnish operations’ transition to Cabonline’ s business model of independent transporters. The number of cars owned by independent transporters increased to 44% during the year, compared with 19% at the start of the year.

Investments for the future
We spent a great deal of time in the first half of the year on preparing the company for a potential change in ownership, which involved the possibility of an IPO. These plans have now proceeded, and we have accelerated the rate of our change activities referring to revenue growth, improvement in profitability and efficiency. We identified several areas of improvement after performing a thorough analysis. The overall theme is consolidation in order to increase quality in our deliveries, improve internal efficiency and thereby become more attractive to our customers, transporters and drivers. By consolidating our operations, we are continuing our work on building one company, one brand and one corporate culture. We will also continue to work on acquisitions, thus contributing to the consolidation of the fragmented taxi market in the Nordic countries. One of the areas of improvement is IT. There is considerable potential to upgrade to the next generation of IT platforms for booking and traffic management, for example. An upgraded, Group-wide IT platform will allow us to conduct our business operations more efficiently. This will mean that acquired taxi operations can be integrated more quickly and easily at the same time as we can raise the quality of deliveries to customers. We started making the preparations for this change in the autumn and are planning a gradual implemen-tation over the next few years. As of our considerations today, the change process will entail investments and restructuring costs of about MSEK 150 over the next three years. These investments and costs will be front heavy. In parallel, we expect to see positive effects on profitability and delivery quality, while also creating the conditions for both a higher pace in our acquisition-driven growth, as well as organic growth. Separately, we are also focusing on how to attract more transporters and drivers and have them joining Cabonline.

New bond loan listed on Nasdaq Stockholm
In order to create a margin for these forthcoming investments and to refinance the bond that was to fall due in 2020, we issued a new bond totaling MSEK 2,200, of which MSEK 1,800 is outstanding. The 2017/20 bond has been redeemed and the new 2019/22 is also listed on Nasdaq Stockholm. 

Brand and sustainability on the agenda
A new brand strategy and sustainability strategy are also strategically important components of our change process. The brand project is ongoing. The aim is to streamline our communication with customers and contribute to an attractive, uniform and clear image of Cabonline in all markets. We also took a step forward in our sustainable development during the year and identified focus areas, our goal is to have a completely fossil-free fleet. Half of our fleet in Sweden has already achieved this goal.

Customer focus
In conclusion, I can say that Cabonline at present is a hive of activity. The entire company is deeply involved in our journey of change. I strongly believe that in a few years we will be the leading taxi brand in the Nordics. We will be the first choice for taxi journeys among our customers regardless if the customer is a consumer, a company, municipality or county council. We will also be the prime choice for transporters and drivers. Traveling with Cabonline should be associated with a simple and easy booking, a car which arrives on time and a safe and pleasant experience.

Peter Viinapuu
President and CEO

For further information, please contact:
Peter Viinapuu, CEO, tel +46 766 411 006
Anneli Lindblom, CFO, tel +46 765 938 400

This information is such that Cabonline Group Holding AB (publ) is obliged to disclose in accordance with the EU’s Market Abuse Regulation. The information was issued for publication through the agency of the contact persons set out above on February 21, at 14:00 a.m. (CET).

 
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 Flygtaxi, 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, visit www.cabonlinegroup.com.  

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