Year-end Report January - December 2000

ElektronikGruppen BK AB (publ) YEAR-END REPORT JANUARY - DECEMBER 2000 Profit more than doubled from MSEK 32.1 to MSEK 70.1 Operating income up 40% to MSEK 700 (501) Orders received rose 55% from MSEK 468 to MSEK 725 Earnings per share increased to SEK 9.19 (3.99) Proposed dividend of SEK 1.25 per share (1.00) Acquisition of Sincotron in February 2001 Continued growth with profitability The year 2000 saw powerful growth in all of ElektronikGruppen's areas of operation. The Group's operating revenue increased dramatically and profit more than doubled. The past year was unusually turbulent, with strong demand for components in the first six months followed by drastic restructuring in the telecom sector during the second half of the year, which made higher demands on adaptability. After recent year's adjustment of the product mix and penetration of anticipated growth markets, the Group was well equipped to cope with market fluctuations. Additional strategic changes were made during the year, such as the implementation of a new organization with subsidiarized business areas and new managers. Johnny Alvarsson took over as President and CEO on 1 January 2001. Alvarsson comes most recently from Zeteco, where he served as President and CEO for the past 13 years. The market The company's traditional activities in distribution and sales of electronic components have shown robust growth and profitability during the year. The strategic investments in in-house manufacture of inductive components, primarily for the telecom industry and transmission networks, have developed favourably in terms of both income and profit. Earlier problems with a component shortage let up during the fourth quarter. The order backlog on 31 December was MSEK 141 (70). Key events during the year The year's profit was charged with costs of MSEK 3.5 for the wind-up of the development company Whitehorse Ltd in the U.K. Costs related to the appointment of a new CEO were charged to profit in the amount of MSEK 4.7. Profit included the company's allocation of surplus funds from SPP amounting to MSEK 7.2. Operations in the business areas EG Electronic Components On 1 October the EG Advanced Components business area changed name to EG Electronic Components (EGEC). The new president of the business area is Ulf Sjunnesson, previously active in EG Communication. He will succeed Peter Carlsson, who will continue to work for ElektronikGruppen with responsibility for Seiko. The business area's profitability and growth during the year, with regard to comparable units, were highly satisfactory. EGEC invoiced a total of MSEK 472 (375) and posted a profit of MSEK 49 (31). Orders received amounted to MSEK 475 (376). The dramatic improvement in profitability was mainly attributable to higher operating income and efficiency in the sales companies, as well as increased commission-based sales. EG Magnetic Technology Components On 1 January 2001, Tommy Jansson, formerly the marketing manager for the business area, was appointed as president. The year's invoicing totalled MSEK 75 (28), with a profit of MSEK 4 (-6). Orders received rose from MSEK 29 to MSEK 76. On 1 September the business area formed a new company in Estonia, EG MTC Estonia Oü, to manufacture inductive components. EG Communication Esbjörn Nordesjö, previously responsible for the business area's business development, was appointed as new president during the third quarter. To facilitate anticipated expansion in Denmark, the business area formed a new company in December, EG Comtech Denmark ApS. The business area is growing organically and has shown a healthy earnings trend, from MSEK 6 to MSEK 18. Orders received increased from MSEK 96 to MSEK 174 and invoicing amounted to MSEK 153 (98). The market for national networks is expected to reach saturation for which reason the focus is shifting to municipal and access networks. Orders received for fiber optic test and splicing equipment have more than doubled. In order to satisfy the surge in demand for passive fiber optic products, new investments have been made and production has been doubled in Estonia. A decision has also been made to increase production capacity in the Philippines. Investments The year's net investments in tangible and financial fixed assets totalled MSEK 15.8 (10.9). Equity ratio and liquidity The Group's financial position remains strong. The equity ratio on 31 December was 55 (59) per cent and liquid assets amounted to MSEK 57 (32). Personnel The number of employees on 31 December was 1,048 (572), of whom 788 work for Magnetron in the Philippines. Acquisitions ElektronikGruppen acquired Sincotron in February 2001 as part of its focus on the telecom sector. Sincotron is a leading supplier of process training and production equipment to the telecom industry in Sweden, Finland and Poland. The share Earnings per share after full tax amounted to SEK 9.19 (3.99). Equity per share on closing day was SEK 32 (24). The proposed dividend per share is SEK 1.25 (1.00), in line with the company's dividend policy. Financial information in 2001 The annual report for 2000 will be available on 3 May 3-month report per 31 March, 23 April 6-month report per 30 June, 18 July 9-month report per 30 September, 18 October The Annual General Meeting will be held on Thursday, 17 May, 5:00 p.m. Vällingby, 19 February 2001 ElektronikGruppen BK AB (publ) Johnny Alvarsson President and CEO For additional information contact: President and CEO Johnny Alvarsson, telephone +46 70 589 17 95 THE GROUP IN SUMMARY, MSEK QUARTERLY DATA Operating Income Orders Received Profit after net financial items 00 99 98 00 99 98 00 99 98 Quarter 1 131 113 116 187 110 117 12,1 6,8 10,1 Quarter 2 177 123 110 168 120 103 19,9 6,1 9,5 Quarter 3 187 124 106 165 119 108 18,3 8,5 7,0 Quarter 4 205 141 125 205 119 111 19,8 10,7 9,4 700 501 457 725 468 439 70,1 32,1 36,0 INCOME STATEMENTS 2000 1999 1998 Operating income Net sales 645,8 476,8 448,9 Invoiced services, 33,3 11,4 6,1 commission-based sales Other operating income 20,4 12,7 1,7 699,5 500,9 456,7 Operating expenses Goods for resale, raw -452,4 -333,4 - materials and consumables 312,3 Other external costs -59,3 -50,6 -38,0 Personnel costs -105,7 -76,7 -63,4 Depreciation of tangible and intangible fixed assets -11,5 -9,3 -7,4 Other operating expenses 0 -0,2 -1,7 Operating profit 70,6 30,7 33,9 Result from financial investments Interest income and similar 3,7 1,8 2,6 profit/loss items Interest expense and -4,2 -0,4 -0,5 similar profit/loss items Profit after financial 70,1 32,1 36,0 items Tax on net profit for the -19,4 -10,3 -10,9 period Minority share in profit -1,1 -0,3 -1,3 Net profit for the period 49,6 21,5 23,8 Balance sheets 31/12/0 31/12/ 31/12 0 99 /98 Intangible fixed assets 6,3 7,3 5,2 Tangible and financial 40,3 33,9 33,7 fixed assets Inventories 82,0 55,9 45,8 Accounts receivable 123,0 81,3 61,2 Other current receivables 12,0 5,9 6,6 Cash and bank balances 57,1 32,4 37,9 Total assets 320,7 216,7 190,4 Shareholders' equity 172,8 126,4 108,7 Minority interest 2,2 2,0 3,7 Interest-bearing 0,0 0,0 1,7 liabilities Operating liabilities and 145,7 88,3 76,3 provisions Total shareholders' equity 320,7 216,7 190,4 and liabilities Cash flow statements 2000 1999 1998 Cash flow before change in 63,7 31,7 35,8 working capital Change in working capital -18,8 -18,1 -10,8 Cash flow from operating 44,9 13,6 25,0 activities Cash flow from investing -15,8 -11,0 -19,5 activities Cash flow from financing -4,4 -8,1 0,0 activities Change in liquid assets 24,7 -5,5 -5,5 Five-year summary, MSEK 2000 1999 1998 1997 1996 INCOME STATEMENTS Operating income 699,5 500,9 456,7 454,3 310,5 Operating profit 70,6 30,7 33,9 32,6 7,6 Profit before tax 70,1 32,1 36,0 32,0 6,9 Tax -19,4 -10,3 -10,9 -9,4 -4,0 Minority share profit -1,1 -0,3 -1,3 -0,6 -0,1 Net profit for the 49,6 21,5 23,8 22,0 2,8 period ASSETS Fixed assets Intangible fixed 6,3 7,3 5,2 4,2 6,8 assets Tangible and financial 40,3 33,9 33,7 25,0 12,0 fixed assets Current assets Liquid assets 57,1 32,4 37,9 32,4 36,7 Other current assets 217,0 143,1 113,6 109,3 80,2 Total assets 320,7 216,7 190,4 170,9 135,7 SHAREHOLDERS' EQUITY AND LIABILITIES Shareholders'equity 172,8 126,4 108,7 88,3 71,8 Minority interest 2,2 2,0 3,7 1,6 -0,8 Interest-bearing 0,0 0,0 1,7 0,2 3,9 liabilities Operating liabilities 145,7 88,3 76,3 80,8 60,8 and provisions Total shareholders' 320,7 216,7 190,4 170,9 135,7 equity and liabilities KEY RATIOS Gross margin % 12,7 8,3 9,6 9,3 4,1 Operating margin, % 10,9 6,4 7,6 7,3 2,5 Profit margin, % 10,9 6,7 8,0 7,2 2,3 Return on equity, % 33,1 18,3 24,2 27,4 4,1 Return on capital 52,4 28,9 38,5 43,3 11,2 employed, % Return on total 27,7 16,1 20,3 21,8 5,7 capital, % Equity ratio % 54,5 59,3 59,1 52,6 52,4 Debt/equity, times 0,0 0,0 0,0 0,0 0,0 Share of risk-weighted 57,8 63,1 63,4 56,3 55,8 capital, % Interest coverage 17,6 50,7 66,6 24,5 5,4 ratio, times Earnings per share, 9,19 3,99 4,45 4,10 0,54 SEK Equity per share, SEK 31,96 23,48 20,29 16,48 13,41 Share price at year- 119 83 60 57 21 end, SEK Net investments in fixed assets - tangible 12,5 3,7 15,9 20,2 4,0 - financial 3,3 7,2 3,6 7,4 3,2 Investments as a % of 2,2 2,2 4,3 6,1 2,3 operating income L ElektronikGruppen BK AB Vällingbyplan 26Box 39SE-162 11 Vällingby Tel +46-8-759 35 00Fax +46-8-37 78 90 infoegruppen.sewww.egruppen.se ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.bit.se/bitonline/2001/06/27/20010627BIT00410/bit0002.doc http://www.bit.se/bitonline/2001/06/27/20010627BIT00410/bit0002.pdf