CONCENTRIC INTERIM REPORT JANUARY – SEPTEMBER 2013
First nine months of 2013: Underlying margins maintained on lower sales y-o-y
- Sales for first nine months MSEK 1,477 (1,698), down 11% year-on-year in constant currency, after adjusting for the acquisition of LICOS Trucktec GmbH (“Licos”)
- EBIT and EBIT margins for first nine months MSEK 209 (249) and 14.1% (14.7) respectively 1)
- Earnings after tax for first nine months MSEK 130 (155) – EPS before & after dilution: SEK 2.95 (3.52) 1)
- Net cash outflow for first nine months MSEK 152 (inflow 31), including the dividend payout of MSEK 110 (88) and the acquisition of Licos of MSEK 105
- Group’s net debt and gearing ratio for Q3 MSEK 590 (471) and 96% (71) respectively – restated for IAS 19 unrecognised pension liabilities and associated deferred tax asset 1)
Third quarter of 2013: Sales and operating income increases y-o-y
- Sales for Q3 MSEK 526 (492), up 3% year-on-year in constant currency, after adjusting for the acquisition of Licos
- EBIT and EBIT margins for Q3 MSEK 76 (74) and 14.5% (14.9) respectively 1)
- Earnings after tax for Q3 MSEK 49 (49) – EPS before & after dilution SEK 1.10 (1.10) 1)
- Cash flow for Q3 from operating activities of MSEK 55 (61)
1) The 2012 comparative figures for EBIT, Earnings before tax and Net income for the period have all been adjusted for the amendments to IAS 19, Employee benefits (see Appendix 1 for restated income statements). In addition, the 2012 comparative figures for net debt and equity have also been adjusted for the amendments to IAS 19, Employee benefits (see Appendix 3 for restated balance sheets).
2) As Return on equity is calculated on a rolling 12 months basis and 2011 has not been restated, no comparable figure has been provided.
President and CEO, David Woolley, comments on interim report for Q3 2013:
“Concentric delivered a solid performance with sales for the third quarter ahead year-on-year for the first time during 2013, up 3% on the same quarter as last year after adjusting for the acquisition of Licos (6%) and the impact of currency (-2%).
However, looking at the sequential development during 2013, there now seems to be a clear polarisation between our two main geographical markets. Europe has continued to show steady signs of improvement with this being the third consequtive quarter of sequential growth. On the other hand, weakening US demand, primarily in the medium/heavy trucks and heavy construction and mining equipment, has resulted in a sequential sales drop of 6% and a year-on-year sales drop of 10% for the third quarter. Whilst our sales experience appears contrary to the latest market indices, we are confident that we have maintained our relative competitive position in all our North American end-markets.
We continue to flex our operations in response to the prevailing uncertain market conditions, underpinned by the Concentric Business Excellence programme. As a result, I am pleased to say that our EBIT margin for the third quarter was maintained at 14.5%.
Looking forward, the orders received this quarter were slightly below sales, even after making seasonal adjustments for the fewer working days planned in the fourth quarter. This reversal of the recent order trend seems to be driven by a weakening of confidence within our hydraulic customer mix for North America, most noticeably at Caterpillar.
We have made good progress in the quarter on the ongoing projects to consolidate our European hydraulics business and integrate the Licos acquisition into the wider Concentric group and, as such, we remain optimistic about the future long-term benefits that will be derived from these initiatives.
We continue to strive to outperform the market through our leading technology addressed at the key market drivers, such as tougher emissions legislation and increased demand for fuel efficient solutions.”
For further information, please contact:
David Woolley (President and CEO), David Bessant (CFO), or Lena Olofsdotter (Corporate Communications), at Tel: +44 121 445 6545 (E-mail: info@concentricab.com)
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