Year-end report January-December 2016

This information is such that Inwido AB (publ) is obliged to publish in accordance with the EU market abuse regulation and the Swedish Securities Market Act. The information was submitted by the below contact persons for publication on 2 February 2017 at 7:45 a.m. CET.

A record quarter and year – in several ways 

Fourth quarter of 2016

• Net sales rose to SEK 1,709 million (1,470), representing an increase of 16 percent. For comparable units and adjusted for currency effects, net sales were unchanged
• EBITA increased to SEK 223 million (76) after items affecting comparability of a negative SEK 4 million (109), and the EBITA margin grew to 13.0 percent (5.2)
• Operating EBITA rose to SEK 227 million (185) and the operating EBITA margin rose to 13.3 percent (12.6)
• Earnings per share after dilution increased to SEK
  2.37 (0.00)
• New financial ambition: To increase operating EBITA by 10% on average annually until 2020

January-December 2016 

• Net sales rose to SEK 5,672 million (5,220), representing an increase of 9 percent. For comparable units, and adjusted for currency effects, this corresponded to a decrease of 1 percent
• EBITA increased to SEK 664 million (480) after items affecting comparability of a negative SEK 10 million (negative 109), and the EBITA margin grew to 11.7 percent (9.2)
• Operating EBITA rose to SEK 673 million (589) and the operating EBITA margin rose to 11.9 percent (11.3)
• Earnings per share after dilution amounted to
  SEK 7.37 (5.10)
• The Board proposes a dividend of 3.50 SEK per share (2.50) 

The CEO comments:
"It is highly gratifying to be able to finish 2016, which was a strong year, with the best quarter ever in Inwido’s history in several ways. Following two consecutive very strong quarters in both the second and the third quarters, with an operating profit of more than SEK 200 million, in the fourth quarter, operating profit rose to SEK 227 million, the highest level ever in an individual quarter for Inwido. Total consolidated sales for the quarter rose 16 percent to a record-high of SEK 1,709 million and the operating margin increased to 13.3 percent. 

Accordingly, 2016 was the strongest year to date for Inwido, with total sales growth of 9 percent to SEK 5,672 million, while operating profit rose by 14 percent to SEK 673 million. This means that the operating margin for the year rose to 11.9 percent and we therefore achieved, in principle, our long-term target of 12 percent, which is very satisfying. Order booking rose by 15 percent over the quarter and by 10 percent over the year. At year-end, the order backlog was 16 percent higher than a year earlier. 

Acquired companies and efficiency 
Acquisitions are, and will continue to be, a fundamental part of Inwido’s growth strategy. In 2016, we acquired four companies based in Denmark, Finland and the UK with combined annual sales of about SEK 900 million. It is gratifying to note that the integration with Inwido is progressing as planned and that all of the acquired companies delivered well. 

Generally speaking, we see a gradual improvement in profitability with a gross margin at a good level. The extensive efforts we have taken in improving the efficiency of production is yielding results. Over the year, we also consolidated our operations by closing three production facilities in line with the decision taken in late 2015. 

Operating segments 
Our consumer-driven strategy continues. For the full-year, consumer sales increased to 74 percent of consolidated sales. In Denmark, where we left the heavier part of the industry market during the year, all key figures are now moving in the right direction. Sweden remains stable with very good profitability even if sales were not satisfactory in the second half of the year. The market activities have therefore been intensified with some success towards the end of the quarter. Norway shows continuous improvement with strengthened confidence among customers. We are also seeing signs that Finland has bottomed out and that new orders may be about to strengthen in the future.  

By continuously developing and launching new products, we are advancing our leading positions. Over the year, we launched several new solutions for the smart home, including a door concept through the Diplomat brand in several markets and the smart window through Hemmafönster in Sweden. 

Overall, EBE (Emerging Business Europe) had a slightly worse year than expected due to a weaker trend in the UK operations in general. Conversely, the recently acquired CWG showed continued positive development. Further, the order bookings in e-Commerce rose by 11 percent over the quarter and by 15 percent over the full-year. We now have e-Commerce operations in seven markets, with launches in the UK and Ireland in late 2016. The profitability trend in e-Commerce is moving in a positive direction. 

Future prospects 
We continue to work towards our vision – to improve life at home – while continuously reviewing our structure to identify further efficiencies. External developments, both political and financial, remain uncertain with many risks that could affect our business. Strong growth in sales and profits has high priority, which is one of the reasons for our new financial ambition to increase operating EBITA by an average of 10 percent annually until 2020.

Based on the position we have managed to achieve in recent years, we are, on the whole, optimistic entering 2017." 

MALMÖ, 2 FEBRUARY 2017

Håkan Jeppsson 
President and CEO 

Read the entire report in the pdf attached

For more information, please contact:
Inwido AB
Håkan Jeppsson, President and CEO Tel.: 46 (0)10-451 45 51 or 46 (0)70-550 15 17
Peter Welin, CFO Tel.: 46 (0)10-451 45 52 or 46 (0)703 24 31 90 
E-mail: peter.welin@inwido.com

About Inwido
Inwido is Europe’s largest supplier of windows and a leading door supplier. The company has operations in Denmark, Finland, Norway, Sweden, Austria, Estionia, Ireland, Lithuania, Poland and the UK, as well as exports to a large number of other countries. The Group markets some 20 strong local brands including Elitfönster, SnickarPer, Hajom, Hemmafönster, Outline, Tiivi, Pihla, Diplomat and Sokolka. Inwido has approximately 4,000 employees and generated sales of slightly more than SEK 5.7 billion in 2016. The Group's headquarters are located in Malmö, Sweden. For further information, please visit www.inwido.com

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