Interim report January – June 2012
1 April – 30 June
- Revenues increased 15 per cent adjusted for currency effects and calculated on comparable workdays. Prior to adjustment, revenues increased 15 per cent to SEK 1,341 M (1,169).
- Adjusted for Meca the growth was 0 per cent.
- EBIT declined 19 per cent to SEK 141 M (173) and the EBIT margin was 11 per cent (15).
- Adjusted for Meca and costs connected to the acquisition of Meca EBIT declined to SEK
120 M (173). - Profit after financial items declined 21 per cent to SEK 132 M (167).
- Profit after tax totalled SEK 93 M (122).
- Earnings per share before and after dilution amounted to SEK 2.65 (3.67).
1 January – 30 June
- Revenues increased 19 per cent adjusted for currency effects and calculated on comparable workdays. Prior to adjustment, revenues increased 20 per cent to SEK 2,437 M (2,032).
- EBIT declined 6 per cent to SEK 252 M (269) and the EBIT margin was 10 per cent (13).
- Profit after financial items declined 9 per cent to SEK 238 M (261).
- Profit after tax totalled SEK 170 M (191).
- Earnings per share before and after dilution amounted to SEK 4.95 (5.75).
- Net debt at the end of the period totalled SEK 2,186 M (671).
Significant events
- During the second quarter, the acquisition of Meca on 23 May 2012 had a positive impact of SEK 173 M on net sales and SEK 32 M on EBIT. Additionally, transaction costs connected to the acquisition of Meca had a negative impact of SEK 11 M on EBIT.
CEO’s comments
Stronger market share in weak market
- Revenues for the second quarter of 2012 rose 15 per cent, including Meca, which is included from 23 May
- The initiated integration of Meca has been successful
- Lower earnings impacted by weak market
Mekonomen’s EBIT for the second quarter of 2012 declined 19 per cent to SEK 141 M (173). Costs for Mekonomen’s long-term investments regarding Mega facilities, the establishment in Finland, the marine venture and proprietary workshops of SEK 9 M (10) is included. Transaction costs related to the acquisition of Meca of SEK 11 M (0) during the second quarter has also affected the result. Adjusted for Meca and transaction costs related to the acquisition of Meca, EBIT declined to SEK 120 M (173). Revenues increased 15 per cent to SEK 1,341 M (1,169) and the EBIT margin was 11 per cent (15). Adjusted for Meca the growth was 0 per cent in a market which declined approximately 7 per cent during the quarter. Focus during the quarter was on further consolidating our operation.
Another strong focus was on integrating Meca and Sørensen og Balchen, which has been successful. Following the acquisitions, both Meca and Sørensen og Balchen have reported good earnings.
Meca, which was acquired on 23 May 2012, reported a strong performance and the integration is progressing ahead of schedule. Net sales from 23 May to 30 June amounted to SEK 173 M and EBIT, which was positively impacted by synergy effects, to SEK 32 M.
Sørensen og Balchen was impacted by a weak consumer market. Net sales during the second quarter declined to SEK 194 M (199) and the EBIT margin was 14 per cent (18). EBIT during the second quarter of 2011 had been positively impacted by a seasonal effect pertaining to the holiday pay debt.
Mekonomen Norway reported an EBIT margin of 17 per cent (18). Net sales were unchanged during the quarter. Sales to affiliated workshops developed well, as did the Fleet division, which secured several new contracts.
EBIT in Denmark declined to a loss of SEK 6 M (profit: 26), with a negative EBIT margin of 3 per cent
(pos: 13), due to a rapid deterioration of the market conditions and an increase in competitive pressure, which had a negative impact on the gross margin. The EBIT margin for the first half of the year was 1 per cent (11). The underlying second-quarter net sales declined 2 per cent. Net sales during the second quarter fell to
SEK 187 M (195), in a market that contracted more than 10 per cent in Denmark. We are currently implementing strong measures to adapt the structure and fixed costs in Denmark to the prevailing market situation, but with a focus on retaining our strong position in this market.
The second-quarter EBIT margin in Sweden was 16 per cent (18). Net sales fell 4 per cent and the underlying net sales decreased 3 per cent. Sales to affiliated workshops developed well.
In Finland, four new Medium units were established during the second quarter. We are noting a positive trend in the new units that have been established.
Mekonomen’s marine venture displayed a favourable sales trend, with a 32 per-cent year-on-year increase during the first half of 2012 in a sharply declining market. However, the area represents a small portion of the Group's total business.
New car sales have decreased and car owners are postponing service and repairs. Although we anticipate a continued weak market for the remainder of 2012, we discern several parallels with 2008, when the market displayed the same patterns and subsequently increased in the following years. For Mekonomen, this means that consolidation of the operations will continue in 2012. It also means that we have an opportunity to capture additional market share and strengthen our position. In the consolidation of our industry, Mekonomen has taken the lead and the acquisition of Meca is a clear example of this. We see healthy potential for organic growth in coming years.
Håkan Lundstedt, President and CEO
For further information, please contact:
Håkan Lundstedt, President and CEO Mekonomen AB, Tel: +46 (0)8-464 00 00
Per Hedblom, CFO Mekonomen AB, Tel +46 (0)8-464 00 00
Gunilla Spongh, Head of International Business Mekonomen AB, Tel +46 (0)8-464 00 00
The information in this interim report is such that Mekonomen is obligated to publish in accordance with the Securities Market Act. The information was submitted for publication on 11 May 2012.
Mekonomen makes CarLife easier through a wide and easily accessible range of affordable and innovative solutions and products for consumers and companies. We are the leading spare-parts chain in the Nordic region, with proprietary wholesale operations, more than 400 stores and more than 2,200 workshops operating under the Mekonomen brands.