Interim Report for January - March 2000

Interim Report for January - March 2000 * Invoiced sales rose 26% to SEK 240 M (191). * Profit after net financial items amounted to SEK 21 M (1). * Profit per share after full tax totaled SEK 2.51 (-0.34). * Important co-operation agreement with Ericsson. * Continued successes in telecom equipment industry; sales up 44%. * Profit after financial items for full-year 2000 is expected to be twice as high as in 1999. Market and sales The early part of 2000 has exceeded expectations in terms of both order bookings and invoiced sales. Sales invoiced by the Nefab Group during the first three months of 2000 amounted to SEK 240 M (191), up 26% compared with the corresponding period in 1999. Order bookings totaled SEK 255 M (194), up 31%. The rapid increase in sales was mainly attributable to increased demand from customers in the telecom equipment industry. Invoiced sales during the most recent 12 months amounted to SEK 887 M, corresponding to growth of 16% compared with the preceding 12-month period. Business area NEFAB ExPak Sales in the largest business area, NEFAB ExPak, rose 29% to SEK 185 M (143). The business area accounts for about 77% of total sales. Increases were noted in all markets. The highest growth was shown in Southern Europe, where sales rose by slightly more than 50%. Nefab's market in North America, where the business area reported a 30% increase in invoiced sales, continues to develop well. The newly established units in Asia and Brazil also noted a favorable sales trend during the first quarter. Sales in these markets during the period totaled SEK 15 M, compared with SEK 4 M in the year-earlier period. Sales trends in this business area are strongly dependent on customers in the telecom equipment industry. Business area NEFAB RePak The NEFAB RePak business area reported a 15% rise in invoiced sales to SEK 47 M (41). The business area accounts for approximately 20% of Group invoiced sales. The favorable development that began in mid-1999 continues, as reflected in such factors as an increase in the volume of tenders. Telecom equipment and automotive industry market segments Telecom equipment industry Nefab's focus on customers in the telecom equipment industry continues to yield results. Sales increased 44% to SEK 103 M (72) and thus account for about 43% of Group invoicing. Nefab is intensifying its cooperation with the largest players in the world market and the Group is developing into a supplier of complete packaging solutions for this industry. This is exemplified by a newly signed cooperation agreement with Ericsson Segment Operators, in which Nefab's contribution involves being a first-tier supplier of packaging materials. In addition to complete packaging solutions, Nefab will assist Ericsson by providing consulting services in technical packaging matters. Automotive industry Sales to the automotive segment totaled SEK 20 M (17), corresponding to 8% of Group sales. The automotive industry is one of Nefab's priority market segments. The prospects for increased market successes are adjudged to be favorable, particularly from NEFAB RePak's viewpoint, since there are many attractive return flows in the automotive industry. Nefab's packaging products have the potential to solve the problems of customers in the industry in a commercially favorable manner. An agreement was concluded with Dräxlmaier, a German supplier of automotive components, in April. The order relates to deliveries of returnable packaging for cable products and is worth approximately SEK 15 M in the next two years. Earnings First-quarter profit after net financial items amounted to SEK 21 M (1). The earnings improvement was attributable to higher sales volumes and the resulting increase in capacity utilization, while overhead costs remained stable. Improvements were noted in virtually all markets and for both business areas. Changes in exchange currency rates has influenced the profit negatively with about SEK 3 M compared with the first quarter 1999. Tax costs for the year have been reduced by SEK 3.6 M as a result of a ruling from the Administrative Court of Appeal regarding a case involving Nefab's income tax returns for 1989. The tax reduction corresponds to SEK 0.52 per share. Earnings per share during the period amounted to SEK 2.51 (-0.34). The return on capital employed was 23.8% (4.9). Acquisition of minority interest outstanding in the Brazilian company Ever since Nefab Embalagens Ltda's formation, 30% of the shares in the Brazilian company have been owned by a local partner. In connection with a new issue of shares in the Brazilian company at the beginning of April 2000, Nefab acquired this minority interest, whereby Nefab Embalagens Ltda is now a wholly owned subsidiary. Investments Group investments amounted to SEK 8 M (10), most of which pertained to machinery and equipment. Financial position The equity/assets ratio on March 31, 2000, was 44.3% (44.5). Shareholders' equity per share amounted to SEK 37.01 (32.29). The Group's liquid funds, including unutilized credit facilities, amounted to SEK 88 M (64). Outlook for full-year 2000 Invoiced sales within NEFAB ExPak are expected to rise, particularly in the telecom equipment industry segment. The more project-oriented sales within NEFAB RePak are also expected to develop positively during the year, thanks to several transactions in the automotive industry segment. The impact on consolidated earnings due to the deficit from Brazilian operations is expected to decrease steadily. In view of the rapid sales increases, investments in expanded capacity are being planned in Europe, North America and China. For 2000 as a whole, profit after net financial items is expected to be twice as high as in 1999, when the corresponding amount was SEK 36 M. Tax expenses for full-year 2000 is expected to approximately 30% of profit after net financial items. Profit and loss accounts 0001-0003 9901-9903 9904-0003 9901-9912 (SEK M) 3 months 3 months 12 months 12 months Net sales 240 191 887 837 Cost of goods sold -172 -143 -641 -612 Gross profit 68 48 246 225 Selling expenses -24 -26 -101 -103 Administrative expenses -21 -17 -80 -76 Operating profit 23 5 65 46 Net financial items -2 -4 -8 -10 Profit after net financial 21 1 57 36 items Taxes -4 -3 -19 -18 Net profit for the year 17 -2 38 18 Depreciation included above 9 9 38 37 Balance sheets (SEK M) 000331 990331 991231 Fixed assets 243 241 247 Current assets 335 266 303 Equity capital 256 223 239 Provisions 26 26 28 Long-term liabilities 124 140 125 Current liabilities 172 118 158 Total capital 578 507 550 Of which interest-bearing 144 148 141 liabilities Source of funds (SEK M) 0001-0003 9901-9903 9901-9912 Operating profit 23 5 46 Depreciation, financial net 4 2 9 and taxes Cash flow from the year's 27 7 55 operation Change in working capital -17 -15 -19 Net investments in fixed -8 -10 -37 assets Cash flow after investments 2 -18 -1 Dividend - - -10 Financing -1 8 -5 Changes in liquid funds 1 -10 -16 Key ratios 0001- 9901-9903 9904-0003 9901-9912 0003 Operating margin, % 9.6 2.2 7.3 5.5 Profit margin, % 8.8 0.3 6.4 4.3 Return on equity capital, % 28.0 -4.1 7.7 7.7 Return on total capital, % 16.6 3.6 6.7 8.8 Return on capital employed, % 23.8 4.9 9.4 12.4 Equity/assets ratio, % 44.3 44.5 44.5 44.1 Employees, yearly average 943 848 932 908 Net investments, SEK M 8 10 35 37 Key ratios per share Profit per share, full tax, 2.51 -0.34 5.52 2.67 SEK Equity capital per share, SEK 37.01 32.29 37.06 34.65 Number of shares at the end of 6,907 6,907 6,907 6,907 the period, in thousands Share price on closing day, 70 60 70 78 SEK For definitions, see Annual Report for 1999. Future financial reports Six-months interim report 2000 August 16, 2000 Nine-months interim report 2000 November 7, 2000 For further information, contact CEO/President Lars-Åke Rydh, tel. +46-70-592 45 70, e-mail lars-ake.rydh@nefab.se, or IR-responsible Anna Stålenbring, tel +46-70-814 23 44, e-mail anna.stalenbring@nefab.se nd Jönköping, May 2 2000 Lars-Åke Rydh President This interim report has not been examined by the company's auditors. Information about Nefab Nefab delivers complete packaging solutions to international industrial groups, primarily within the telecom equipment and automotive industry. Nefab operates within two business areas - NEFAB ExPak (collapsible export packaging systems) and NEFAB RePak (reusable transport-packaging and storage systems). Nefab has its own companies' in Europe, North and South America and Asia. Annual sales is about SEK 1 BN. The Nefab share is listed on the OTC-List of the OM Stockholm Exchange. Nefab AB (publ) Östra Storgatan 20 . P O Box 2184 . SE-550 02 Jönköping . Sweden Telephone +46(0)36-345050 . Telefax +46(0)36-150444 . Organization No. 556226-8143 Homepage: www.nefab.com . E-mail: info@nefab.se The registered office of the board of directors is in Ovanåker, Sweden Quarterly data Q1/98 Q2/98 Q3/98 Q4/98 Q1/99 Q2/99 Q3/99 Q4/99 Q1/00 Net sales 170 182 188 207 191 207 205 234 240 Cost of -122 -132 -136 -155 -143 -152 -147 -170 -172 goods sold Gross 48 50 52 52 48 55 58 64 68 profit Selling -23 -25 -23 -30 -26 -27 -22 -28 -24 expenses Administrat -17 -19 -18 -22 -18 -18 -18 -22 -21 ive expenses Operating 8 6 11 0 4 10 18 14 23 profit Net -1 0 -2 -1 -3 -2 -3 -2 -2 financial items Profit 7 6 9 -1 1 8 15 12 21 after net financial items Taxes -2 -3 -5 -2 -3 -6 -6 -3 -4 Net profit 5 3 4 -3 -2 2 9 9 17 for the year Fixed 207 215 245 247 241 240 236 246 243 assets Current 243 263 273 275 266 286 283 304 335 assets Equity 235 229 235 233 223 216 222 239 256 capital Provisions 18 18 22 26 26 26 26 27 26 Long-term 72 104 137 131 140 148 126 126 124 liabilities Current 125 127 124 132 118 136 145 158 172 liabilities Total 450 478 518 522 507 526 519 550 578 capital Operating 4.8 3.2 5.6 0.2 2.2 5.1 8.8 5.8 9.6 margin, % Profit 4.3 3.2 4.4 -0.3 0.3 3.9 7.5 5.2 8.8 margin, % Return on 8.2 4.6 6.5 -4.2 -4.1 4.6 16.4 16.1 28.0 equity capital, % Return on 7.9 5.9 8.8 1.6 3.6 8.4 13.9 10.6 16.6 total capital, % Return on 11.1 8.2 12.1 2.2 4.9 11.5 19.6 15.2 23.8 capital employed, % Equity/asse 52.3 48.4 45.7 45.1 44.5 41.6 43.4 44.1 44.3 ts ratio, % Profit per 0.69 0.39 0.54 -0.36 -0.34 0.36 1.30 1.34 2.51 share full tax, SEK Equity 34.07 33.09 33.96 33.68 32.29 31.26 32.22 34.65 37.01 capital per share, SEK Share price on closing 131 119 98 85 60 64 57 78 70 day, SEK Sales development per quarter Earnings trend per quarter ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/2000/05/02/20000502BIT00370/bit0001.doc http://www.bit.se/bitonline/2000/05/02/20000502BIT00370/bit0002.pdf