Lagercrantz Interim Report 2021/22 Q1

First quarter (1 April – 30 June 2021)

• Net revenue increased by 33% to MSEK 1,301 (977).
  • Organically, net revenue increased by 18%.
• Operating profit (EBITA) increased to MSEK 212 (124), equivalent to an operating margin of 16.3% (12.7).
• Profit after financial items increased by 94% and amounted to MSEK 180 (93).
• Profit after taxes increased to MSEK 139 (70). Earnings per share after dilution amounted to SEK 2.24 for the moving 12-month period (SEK 1.91 for the 2020/21 financial year).
• Return on equity was 25% (21). The equity ratio at the end of the period was 36% (41).
• • CW Lundberg (CWL) including subsidiaries in Sweden, Norway and Poland. CWL has a business volume of about MSEK 185 with good profitability.
  • Libra in Norway with a subsidiary in Latvia and an associated company in Vietnam. Libra has a business volume of about MNOK 175 with good profitability.
• The Annual General Meeting will be held on 24 August 2021 at 4.00 p.m. at IVA’s Conference Centre in Stockholm. Due to the continued uncertainty regarding the infection situation, a limited attendance and postal voting procedure are planned.
• The Board of Directors in the notice convening the Annual General Meeting intends to propose a dividend of SEK 1.00 (0.67) per share.

Statement of the Chief Executive

“A really good start to the year” – that is how I would like to sum up the first quarter of the financial year. The recovery after the pandemic that we communicated in recent quarters has strengthened and changed over to growth where all divisions are delivering good organic growth and in addition we have clearly obtained positive effects from the acquired businesses. In terms of numbers, the organic sales growth for the Group was a historically high 18% and just as much came from acquisitions. Of the increase in the operating profit of MSEK 88 in total, MSEK 52, equivalent to approximately 60% came from organic improvements. Being well aware of the fact that the first quarter of the previous financial year was negatively impacted by the effects of the pandemic, this is still very gratifying and stronger than we expected.

Quarterly earnings were therefore strong, where the profit (after net financial items) reached MSEK 180, which is essentially double compared to the same quarter last year (93). The operating margin reached 16.3% (12.7) and earnings per share on a moving 12-month basis now amounts to SEK 2.24 per share, compared to 1.91 for the 2020/21 financial year.

It was also positive during the quarter that we launched our new growth ambitions – what we are calling “Lagercrantz towards one billion” –  where starting from 1 April we have established a new organisation with a new divisional structure, clearer growth ambitions, both organically and through acquisitions, and a clear focus with ambitions and goals relating to sustainability. By concentrating the divisions on attractive areas with underlying structural growth and declared goals for sustainability, the intention is to focus on the right things, to attract the stock market, acquisition market, employees, suppliers and thereby further improve the potential for growth.

It is also important to comment on the two acquisitions we carried out during the quarter. We see along the way that Lagercrantz’s approach to nurturing, internationalising and advancing owner-led product companies in particular, is perceived as increasingly attractive. We are therefore proud and happy that the owners of CW Lundberg in Mora and Libra in Norway have chosen to let their life’s work become a part of Lagercrantz. These companies generate combined annual revenue of about MSEK 360 with good profitability and the intention in both cases is to continue developing the export side of the businesses. During the previous year, a further eight owners decided to sell specifically to Lagercrantz as they have confidence in our ownership concept, which is characterised by decentralisation and management by objectives.

Ahead of the coming quarters, I am still optimistic. The first quarter, which we have now just completed is a seasonally strong quarter for Lagercrantz, and this seasonal pattern has been strengthened, among other things due to the acquisitions of Sajas, VP metall, CW Lundberg and Libra. Several of the companies in the Group are also noticing a component shortage, rising raw materials and freight costs, which are uncertainties going forward. Meanwhile, order intake remains strong which gives me great confidence about Lagercrantz’s prospects both in the short and long term.

Jörgen Wigh
President and CEO

Stockholm 16 July 2021

Lagercrantz Group AB (publ)

A phone conference will be held 16 July at 10 am CET, in English.
Phone: +46 8 619 7530. PIN: 332347#
Link to presentation: 
https://www.lagercrantz.com/en/reports-and-presentations

For further information please contact:
Jörgen Wigh, President and CEO, Lagercrantz Group AB, telephone +46 8 700 66 70,
Kristina Elfström Mackintosh, Chief Financial Officer, Lagercrantz Group AB, telephone +46 8 700 66 70
or visit our website www.lagercrantz.com

This information is such information that Lagercrantz Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication at 8.00 CET on 16 July 2021.

LAGERCRANTZ GROUP IN BRIEF
Lagercrantz Group is a technology group that offers world-leading, value-creating technology, using either proprietary products or products from leading suppliers. The Group is comprised of some 60 companies, each with a focus on a specific sub-market – a niche. High value-creation is common to all the companies, including a high degree of customisation, support, service and other services. Lagercrantz Group is active in nine countries in Northern Europe, in China, India and in the USA. The Group has approximately 1,800 employees and annual revenue exceeding MSEK 4,000. The Company is listed on Nasdaq Stockholm since 2001. www.lagercrantz.com

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