Interim report January - June 2013

Stable gross margin in weak markets

April – June 2013

• Net sales amounted to SEK 1,141 million (1,258), which, adjusted for currency and structural effects, represents a decline of 3 percent
• Operating profit (EBITA) amounted to SEK 105 million (66), including items affecting comparability amounting to SEK 0 million (negative 54)
• Including items affecting comparability, the operating margin (EBITA) was 9.2 percent (5.3)
• Profit after tax was SEK 58 million (39)
• Cash flow from operating activities was SEK 68 million (56)

January – June 2013

• Net sales amounted to SEK 1,998 million (2,263), which, adjusted for currency and structural effects, represents a decline of 4 percent
• Operating profit (EBITA) amounted to SEK 86 million (47), including items affecting comparability amounting to a negative SEK 3 million (77)
• Including items affecting comparability, the operating margin (EBITA) was 4.3 percent (2.1)
• Profit after tax was SEK 29 million (17)
• Cash flow from operating activities was negative in the amount of SEK 55 million (126)

CEO Håkan Jeppsson comments:
“The second quarter of 2013 was pervaded by continued tough market conditions, with unpredictability and caution being clear characteristics. Consumers in the Nordic region and in Europe remain doubtful regarding the economic trend and many are delaying purchasing decisions. This is holding down demand and resulting in increased price pressure. We are now also starting to see a declining trend on the industry side, with an increasing number of building projects being postponed. As a consequence, volumes have declined in our principal markets, with the exception of Finland, which is also exerting pressure on profitability. However, despite lower sales – 3 percent down compared with the year-earlier period adjusted for currency and structural effects – we have managed to defend our gross profit margins. We are also succeeding at keeping order bookings at the same level as last year, which I find positive given the market situation.

When it comes to our individual markets, we are still seeing a decline for Inwido in Norway. This is primarily driven by a weakened position in the door market, although the process of change that has been initiated is also temporarily weakening the efficiency of our Norwegian organisation. On the positive side, Finland continues to perform better than last year. Margins are higher as a consequence of increased volumes and enhanced efficiency. Denmark, which began with a weak first quarter, has, since the introduction of the new tax deduction for renovation work in April, seen an increase in volumes and is now, like Sweden, performing at the same level as last year. In the European market, Russia in particular experienced a decent spring, while the other markets are struggling to maintain last year’s pace.

During the early part of this year, much of our focus was on efficiency, structure and synergy measures. For almost two years now, we have been working to enhance the efficiency of our production structures, which is generating positive effects, both organisationally and in terms of costs. In my assessment, we have good capacity control, allowing us to adapt relatively quickly to the unpredictable demand that pervades the market. We have great respect for the current economic situation and do not see any signs of an immediate shift in the market climate. Consequently, we consider it particularly important to focus on those aspects that we are able to control, that is, to do more, to do it better and, above all, to do it more efficiently. Historically, Inwido has enjoyed a strengthened market position in uncertain times, which causes us to place increasing emphasis on our strategic focus with sharpened offerings to consumers and product development ventures. Today, Inwido is a well-trimmed company with a strong market position, meaning we have good potential when the market improves.”

Read the entire report in the pdf attached

For further information, please contact:
Håkan Jeppsson, President and CEO
Telephone +46 (0)70 5501517 or +46 (0)10 4514551, e-mail: hakan.jeppsson@inwido.com
Peter Welin, CFO
Telephone +46 (0)70 3243190 or +46 (0)10 4514552, e-mail: peter.welin@inwido.com

About Inwido
Inwido is Northern Europe’s leading supplier of innovative, environmentally friendly, wood-based window and door solutions. The company has operations in Sweden, Denmark, Finland, Norway, Poland, Russia, the UK and Ireland, as well as exports to a large number of other countries. The Group markets some 20 strong local brands including Elitfönster, SnickarPer, Hajom, Outline, Tiivi, Pihla, Diplomat and Sokolka. Inwido has approximately 3,100 employees and generated sales of slightly more than SEK 4.6 billion in 2012. The Group's headquarters are located in Malmö, Sweden. For further information, please visit www.inwido.com

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