Jetpak Top Holding AB (publ):Interim report 1 January – 30 June 2023

Second quarter: 1 April – 30 June 2023
 

• Total revenue decreased by -9,6 % to 293 607 (324 891) TSEK
• Organic growth amounted to -12,6 % (17,4 %)
• Gross margin amounted to 31,9 % (31,8 %)
• Adjusted EBITA amounted to 33 817 (33 118) TSEK
• Impairment loss amounted to - 51 705 (-) TSEK
• Operating profit amounted to -18 792 (32 136) TSEK
• Net income amounted to -25 475 (22 572) TSEK
• Basic earnings per share amounted to -2,09 (1,88) SEK
• Diluted earnings per share amounted to -2,09. (1,87) SEK
• Cash flow from operations amounted to 28 958 (32 953) TSEK
• Cash and cash equivalents amounted to 166 673 (132 004) TSEK
• Net debt in relation to adjusted EBITDA R12: 0,3 (0,7)
• Cost accrual for the long-term incentive program
  amounted to -2 264 (-2 153) TSEK

• Total revenue decreased by -2,8 % to 606 730 (623 998) TSEK
• Organic growth amounted to -5,2 % (13,8 %)
• Gross margin amounted to 31,2 % (31,5 %)
• Adjusted EBITA amounted to 65 379 (64 058) TSEK
• Impairment loss amounted to -51 705 (-) TSEK
• Operating profit amounted to 11 884 (62 368) TSEK
• Net income amounted to -766 (44 155) TSEK
• Basic earnings per share amounted to -0,06 (3,68) SEK
• Diluted earnings per share amounted to -0,06 (3,65) SEK
• Cash flow from operations amounted to 26 251 (46 091) TSEK

The comparison figures within parentheses refer to the corresponding period last year, unless otherwise stated.
 

CEO comments

On a total group basis, the revenue for the quarter amounted to 293 607 TSEK, which was a negative growth of -9,6 %.
The adjusted EBITA amounted to 33 817 (33 118) TSEK, corresponding to an adjusted EBITA margin of 11,5 (10,2) %.
This quarter’s operating profit was impacted by a non-cash flow goodwill impairment loss of -51 705 TSEK, due to a weaker road business in Denmark
and increased WACC for group companies.
The reported operating profit, including the write-down on goodwill, hence amounted to -18 792 (32 136) TSEK for the quarter.

The cash flow from operations amounted to 29 MSEK. Despite a weaker macroeconomic outlook, we expect to be able to uphold a good cash conversion rate.

Current market conditions had a negative revenue impact during this quarter, affecting both our segments.

The Express Air segment had a revenue of 143,9 MSEK, which equaled a revenue decrease of -15,2 %, while the gross margin remained flat on 40,4 (40,1) %.
The biggest revenue decrease within the segment came from Jetpak Europe (consisting of the combined operations in the Netherlands and Belgium), with a 42 % revenue drop. Jetpak Europe was affected by decreasing revenue from the spare part logistic market, where our customers have initiated cost saving programs including deferred logistic solutions. We still have them as important customers, even though revenue has significantly decreased compared with last year.
Norway and Finland also reported revenue drops while Sweden was flat and with Denmark as the only geography with increasing revenue.

The Express Road segment had a revenue of 142,5 MSEK, corresponding to a revenue decrease of -2,4 %, while the gross margin increased to 21,9 (20,1) %, affected by changed customer mix.

The net drop within the road segment came from Denmark, which dropped by 13 % due to lost customer contracts, changing market conditions and increasing price competition. Sweden, Norway and Finland were more or less flat between the years, with Europe, albeit with small numbers, reported growing revenue.

Specific revenue and profit enhancement programs have been launched in both Denmark and Europe, but due to current market situation we expect the remainder of 2023 to be challenging, as these programs will not have full impact before early 2024.
Based on the challenging market situation during the quarter, Jetpak Management has also initiated a general groupwide cost efficiency program focusing on reducing overhead costs based on staff reductions and revised incentive schemes as well as further enhancing Jetpak’s operational cost structure and level.

Jetpak’s ESG strategy is based on our long-term commitment to environment responsibility as well as commitment to our customers, employees, and other stakeholders. We have launched our ESG strategy to further integrate sustainability within all our business processes.
As part of the ESG work - as well as new technology - is the future drone delivery opportunity, and new opportunities provided by enhanced AI solutions.
Jetpak has during the quarter continued to explore to what extent the drone technology can support Jetpak’s future supply chain. We have had a continued positive cooperation with a Swedish drone project resulting in a letter of Intent. The parties have a mutual ambition of launching drones in specific areas in Sweden.
Commercial startup date is not yet defined but awaits authority approval as well as commercial commitment from customers.

New projects are also initiated focusing on identifying process and cost enhancements by introducing AI solutions for some customer and supplier interfaces.
This is still in an initial phase but is expected to potentially automate manual repetitive processes and improve our delivery quality.

M&A remains an important part of our growth strategy and during the second quarter we announced the acquisition of Budakuten in Malmö. We continue to explore interesting new M&A targets with good fit during coming periods, as we still deem the market to be favorable for acquisitions.
We are currently in deeper discussions with some targets with the ambition of deciding on further potential acquisition within the coming quarters.

During recent months we have had ongoing discussion with our largest air capacity supplier (SAS), due to, among other things, their lack of network stability, which are negatively impacting our product quality and operational costs. During this quarter we reached an agreement ensuring a more balanced cooperation with enhanced quality and cost level. Additionally, we expect their Chapter 11 situation to be finalized in a relative near future.

In general, we have experienced a continued market and revenue volatility. Interim reports from big multinational logistic companies seem to support this trend, as reports mostly show decreasing volumes and profitability within both air and road segments.
Nordic and European GDP growth is furthermore expected to remain weak during coming quarters, which potentially may lead to increasing price pressure and a lower demand for logistic solutions.

Based on the current market conditions and uncertainty we conservatively expect a continued weak organic growth in coming quarter, with possibly a slightly improved growth during the fourth quarter.

We therefore continue to carefully monitor the development, and we will continually try to minimize any potential negative impacts by further ramping up on our strategic initiatives, namely:

• Realizing M&A opportunities to strengthen our market position and offering as well as obtaining operational and commercial scale benefits.
   
• Introduce new services to ensure organic growth as well as strengthening our offering and margins.
   
• Optimize cost efficiency by enhanced and automated technology driven solutions as well as through improved capacity utilization.

Despite the above-described challenges, we maintain our long-term targets for organic growth and a continuously improved adjusted EBITA.

Kenneth Marx,
Chief Executive Officer

Conference call

At 10:00 CET today, Kenneth Marx, CEO and Håkan Mattisson, CFO, will be presenting Jetpak's result for the quarter. The presentation will be held in English.

Please use one of the dial-in numbers below to join the conference call:

Sweden:  +46 (0) 20 089 63 88
Norway:  +47 2 156 3319    
Finland: +358 9 2319 54 36                       
Denmark:  +45 8088 8650 
Germany:  +49 (0) 30 3001 90613     
France  +33 (0) 1 7037 7167
Belgium:  +32 0800 746 56                    
USA:  +1 866 571 0905
UK:  +44 (0) 33 0551 0202

Note that any toll free numbers can only be reached from within each county.

PIN code (same code for all the above dial-in numbers): 170 50 39 #

Please make sure you are connected to the phone conference by calling in a few minutes before the conference begins.
 

The company’s certified advisor is FNCA Sweden AB.


This information was submitted for publication, through the contact person mentioned below, on 29 August 2023 at 06:30 CET.
This constitutes information that Jetpak Top Holding AB (publ) is required to publish under the EU Market Abuse Regulation.
 

The full report is attached here and also available at:
https://jetpakgroup.com/en/investors/financial-reports/       

For further information

Håkan Mattisson, CFO
Phone: +46 8 5558 5220
e-mail: ir@jetpak.com


About Jetpak

Jetpak is a logistic group represented in more than 170 locations around the Nordic region and in Europe. Jetpak has a unique and flexible customer offering based on having access to normally approximately 4,000 daily flight departures, in combination with a comprehensive distribution network with more than 950 delivery vehicles. This is something that makes it possible for Jetpak to deliver the fastest and most comprehensive 24/7/365 same-day logistic service to the market.
This can be further supplemented by a unique customized next-day service for systemized transports.

Segment wise, Jetpak has its business divided into one Express Air segment, where the customers’ fast logistic needs have been solved by an air-based solution, and into one Express Road segment, where the customers’ logistic needs have been solved by a land-based courier transport solution.

The group’s parent company, Jetpak Top Holding AB (publ), is since 5 December 2018 listed on Nasdaq First North Premier Growth Market in Stockholm, Sweden.
The Jetpak share is traded under the short name JETPAK and with the ISIN code SE0012012508.
Please visit: https://jetpakgroup.com