Year-End Report for Duni AB (publ) 1 January – 31 December 2013

Improved earnings in all business areas

1 October – 31 December 2013

• Net sales amounted to SEK 1 102 m (1 031). Adjusted for exchange rate changes, net sales increased by 6.2%.
• Earnings per share, after dilution, amounted to SEK 2.25 (-0.32).
• Strong cash flow with historically low net debt (< SEK 500 m).

1 January – 31 December 2013

• Net sales amounted to SEK 3 803 m (3 669). Adjusted for exchange rate changes, net sales increased by 4.7%.
• Earnings per share, after dilution, amounted to SEK 5.68 (2.67).
• The Board proposes a dividend of SEK 4.00 (3.50) per share.

Key financials

1)  Underlying operating income; for link to reported operating income, see the section entitled "Non-recurring items".
2) Comparison figures for 2012 recalculated in accordance with IAS19R; see further in Note 2.

CEO’s comments

“The concluding quarter of the year demonstrates growth and improvement in earnings within all business areas. Net sales for the quarter, measured at fixed exchange rates, amount to SEK 1,095 m (1,031), representing growth of 6.2% compared with last year. Operating income, before structural costs, increased by SEK 22 m and reached SEK 152 m (130). The improvement is mainly attributable to strong Christmas sales and good capacity utilization at our production plants, but is also due to underlying improvements in our business areas. Cash flow remains strong and, at the end of the quarter, the net debt was SEK 491 m (638).

Following a slow start to the year, the sales trend has gradually strengthened. The new organization structure is contributing to more active working of the market and our position has strengthened on several markets and product segments. The take-away range is continuing to expand within Professional, while within Consumer we are winning an increasing number of customer contracts. This development is to be seen in light of continued weak general demand in several regions. The European HoReCa markets have retreated some percentage points and as yet there are no clear signs of any improvement. The consumer market is somewhat more stable.

At fixed exchange rates, Professional increased its quarterly sales by SEK 36 m compared with last year. Net sales measured at fixed exchange rates were SEK 758 m (722), with growth primarily due to the acquisition of Duni Song Seng. Sales outside Europe are continuing to grow by double digits, albeit from low levels. The improvement in Eastern and Southern Europe during the quarter is particularly pleasing. The tendency is that our position in these markets stabilize more and more. Operating income in the quarter increased to SEK 127 m (109) and the operating margin was 16.6% (15.1%).

The Consumer business area showed a rate of growth of 11.8% in the quarter, with net sales at fixed exchange rates amounting to SEK 221 m (197). This trend is a consequence of new contracts secured in 2012 and 2013, but is also due to positive Christmas sales. Operating income was SEK 23 m (19) and the operating margin strengthened to 10.6% (9.6%).

Within the Tissue business area, the improvement is entirely due to the decision to phase out the external hygiene product sales. The decision to discontinue that business has facilitated a more efficient operation, at the same time as measures relating to the future closure are being implemented gradually. Net sales during the quarter amounted to SEK 117 m (111) and the operating income was SEK 2 m (2). Volumes during the quarter were on par with last year.

2013 has been an eventful year, characterized by several important initiatives. The rate of growth for the year (measured in comparable currency) was 4.7%, which is satisfactory on a zero-growth market. At the same time, we see that the sales trend strengthened during the latter part of the year. With 2013’s endeavors accomplished, we can face 2014 with a good measure of self-confidence,” says Thomas Gustafsson, President and CEO, Duni.

Additional information is provided by:

Thomas Gustafsson, President and CEO, +46 40 10 62 00
Mats Lindroth, CFO, +46 40 10 62 00
Tina Andersson, Corporate Marketing & Communications Director, +46 734 19 62 24

Duni is a leading supplier of attractive and convenient products for table setting and takeaway. The Duni brand is sold in more than 40 markets and enjoys a number one position in Central and Northern Europe. Duni has some 1,900 employees in 18 countries, headquarters in Malmö and production units in Sweden, Germany and Poland. Duni is listed on NASDAQ OMX Stockholm under the ticker name “DUNI”. ISIN-code is SE 0000616716.
Duni.com

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