Interim report, January-September 2019

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This information is such that Inwido AB (publ) is obliged to publish in accordance with the EU market abuse regulation. The information was submitted by the below contact persons for publication on 23 October 2019 at 7:45 a.m. CET.

Strong cash flow and continued favourable growth in e-commerce

Third quarter of 2019

  • Net sales amounted to SEK 1,665 million (1,682), representing a decrease of 1 percent. Organic growth was a negative 2 percent.
  • EBITA amounted to SEK 203 million and the EBITA margin increased to 12.2 percent. Excluding IFRS 16, EBITA amounted to SEK 200 million (200) and the EBITA margin rose to 12.0 percent (11.9).
  • Operating EBITA rose to SEK 203 million and the operating EBITA margin rose to 12.2 percent. Excluding IFRS 16, operating EBITA amounted to SEK 200 million (202) and the operating EBITA margin unchanged at 12.0 percent.
  • Earnings per share rose to SEK 2.56 (2.31).

January-September 2019

  • Net sales rose slightly to SEK 4,818 million (4,802), an increase of less than 1 percent. Organic growth was a negative 3 percent.
  • EBITA increased to SEK 435 million and the EBITA margin increased to 9.0 percent. Excluding IFRS 16, EBITA increased to SEK 426 million (420) and the EBITA margin rose to 8.8 percent (8.7).
  • Operating EBITA amounted to SEK 435 million and the operating EBITA margin was 9.0 percent. Excluding IFRS 16, operating EBITA amounted to SEK 426 million (442) and the operating EBITA margin was 8.8 percent (9.2).
  • Earnings per share rose to SEK 5.20 (5.16).

The CEO comments:
"For the third quarter of 2019, we delivered improved earnings, while strong cash flow brought net debt down to 2.5x EBITDA, excluding IFRS 16. This development, with improved earnings despite challenging markets, testifies to the strength of our new governance model, Simplify. Compared with the corresponding period in the preceding year, net sales decreased by 1 percent in the third quarter to SEK 1,665 million (1,682).

Despite the lower sales, we increased our profitability, mainly thanks to early cost saving initiatives and a more advantageous mix overall, with a higher proportion of consumer sales compared with the preceding year. Our assessment is also that we are, on the whole, continuing to capture market shares in the Nordic market.

Continued positive development in South, stabilization in North
Business area South continued to develop positively during the quarter, with strong development among the companies in the area. Business area South’s sales increased by 7 percent and its operating EBITA rose to SEK 135 million (118), meaning that the operating EBITA margin rose to 18.7 percent (17.5). Among our larger Danish operations, development remains strong, confirming that Inwido’s leadership, combined with independent local companies, can gradually develop and refine the operations. The positive trend in e-Commerce continued, with organic sales growth of 8 percent and maintained profitability, and today 10 percent of consolidated sales derive from e-Commerce. This is encouraging proof that our efforts in e-Commerce produce results too.

Business area North developed more weakly. In Sweden and Finland, the industry market remains challenging, with decreased new construction, although the trend in the consumer segment, which is of importance to Inwido, appears relatively stable. It is gratifying to note how our new governance model, Simplify, has served the development of the Norwegian operations, which continued to develop strongly during the quarter. While developing our companies, we also have efficiency improvements and cost savings continuously in progress to counteract volume losses. Sales for the third quarter decreased by 7 percent, while operating EBITA decreased to SEK 72 million (91), meaning that the operating EBITA margin landed at 8 percent (9.4).

Strong cash flow and reduced debt
Inwido’s guiding principles are to acquire and develop Europe’s best companies in windows and doors. Our long-term acquisition strategy stands firm and our efforts are continuing to further strengthen the balance sheet to be able to make acquisitions. The third quarter has encouraged us in these efforts. During the period, operating cash flow was positive in the amount of SEK 319 million, compared with SEK 149 million in the corresponding period in the preceding year, meaning that the net debt/EBITDA ratio at the end of the quarter fell to the Group’s target of 2.5, excluding IFRS 16, compared with 3.0 twelve months earlier.

Future prospects
With a strong earnings and cash flow, as well as being backed up by 28 companies, we enter the fourth quarter with both confidence and humility. The Nordic industrial market remains challenging, and assessing the consumer markets is difficult. Every day, we work hard to streamline and develop companies in geographies with more challenging market conditions while, at the same time, refining the companies in the more favourable markets and continuing to invest for growth in e-commerce. We do all of this to be able to satisfy the underlying investment needs of both the new construction and renovation markets.

By demonstrating our resilience in harsher periods, with stable margins and a capacity for developing our companies, we consider ourselves well-positioned to tackle the conditions with which the markets and our customers will present us and our companies in the future."


Henrik Hjalmarsson
President and CEO

Read the full report in the pdf attached 

For more information, please contact:
Henrik Hjalmarsson, President and CEO Tel.: 46 (0)76 846 20 46 
Peter Welin, CFO and deputy CEO Tel.: 46 (0)703 24 31 90 

About Inwido 
Inwido owns and develops companies that improve people’s everyday lives indoors with various products and services. Today, Inwido is Europe’s largest windows group and a natural home for the region’s strongest companies in the areas of comfort, indoor climate and safety. In 2018, Inwido achieved sales of SEK 6.7 billion and an operating EBITA margin of 9.9 percent. The Group has some 4,500 employees in total, with operations in Denmark, Estonia, Finland, Ireland, Lithuania, Norway, Poland, Romania, the UK, Sweden and Germany.





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