Interim Report New Wave Group AB (publ.)

Interim Report New Wave Group AB (publ.) January-September 2001 · For the period July - September 2001 the New Wave Group of companies increased its sales by 25 percent and amounted to SEK 314.2 (251.2) millions. · For the period July - September 2001 the result after financial items decreased with SEK 15.5 to 0.7 (16.2) millions. · For the period January - September 2001 the New Wave Group of companies increased its sales by 17 percent to SEK 911.6 (782.1) millions. · The sales during September were extremly weak, but it recovered during October. · The result after financial items in comparative figures for the period January - September 2001 decreased by 6 percent to SEK 54.5 (57.9) millions. The result after financial items, including previous years refund from SPP of SEK 8.0 million,decreased by 17 percent to SEK 54.5 (65.9) millions. · The net result in comparative figures for the period January - September 2001 increased by 31 percent to SEK 50.5 (38.6) millions. The net result for the period January - September 2001, including previous years refund from SPP of SEK 8 millions, increased by 15 percent to SEK 50.5 (44.0) millions. · For the period January - September 2001 the Profiling business area increased it's sales by 12 percent to SEK 588.0 (527.0) millions. The result after financial items in comparative figures decreased by 15 percent to SEK 45.8 (51.0) millions. The result after financial items, including previous years refund from SPP of SEK 3.6 millions, decreased by 9 percent to SEK 45.8 (50.4) millions. · For the period January - September 2001 the Retailing business area increased its sales by 27 percent to SEK 323.6 (255.1) millions. The result after financial items in comparative figures decreased to SEK 8.7 (11.9) millions. The result after financial items, including previous years refund from SPP of SEK 4.4 millions, increased by 16 percent to SEK 8.7 (7.5) millions. · The result after financial items in comparative figures for the period October - September 2001 increased by 16 percent to SEK 83.7 (72.2) millions. The result after financial items including previous years refund from SPP of SEK 8 millions, increased by 4 percent to SEK 83.7 (80.2) millions. · The result after financial items for the period January - September 2001 has been negatively affected by the subsidiaries in United Kingdom, Spain, France and the establishment of Make Your Own Design in Scandinavia AB with an amount of SEK 21.1 millions. · The result after financial items for the period July - September 2001 has been positively effected through the aquisition of Seger Group AB and Sagaform AB with an amount of SEK 1.6 millions. · The increase in the balance sheet amounting to SEK 347.0 millions is mainly due to the aquired companies Sagaform AB and Segerkoncernen AB, which stands for 51 percent of the increase and, as part of the total balance sheet, 14 percent. At the same time, the two companies stands for 6 percent of the total turnover. These two companies are temporarly heavily detoriation New Wave Groups key figures. Third quarter During July - September 2001, the sales increased by 25 percent to SEK 314.2 (251,2) millions, wherof the sales in Segerkoncernen AB and Sagaform AB amounted to SEK 32.9 millions. During July - September 2001 the result after finanial items decreased by SEK 15.5 millions to SEK 0.7 (16.2) millions. The result after financial items has also been negatively affected by poor results in the subsidiaries in United Kingdom, France, Spain, Make Your Own Design in Scandinavia AB and Textwear A/S in Norway During the third quarter 2001, the gross profit margin decreased to 33.6 (38.1) percent. This decrease is mainly due to more badly gross margins in the subsidiaries in Spain, Sko Team AB and negative currency impact on goods sold. Period January - September Sales During January - September 2001, the sales increased by 17 percent to SEK 911.6 (782.1) millions. Sales for the Profiling business area increased by 12 percent and sales for the Retailing business area increased by 27 percent. Sales on the Swedish market increased by 7 percent to SEK 551.4 (514.3) millions. Sales in the foreign markets increased by 34 percent to SEK 360.2 (269.7) millions. Financial results During January - September 2001, the result after financial items in comparative figures decreased by 6 percent to SEK 54.5 (57.9) millions. The result after financial items, including previous years refund from SPP of SEK 8.0 millions, decreased by 17 percent to SEK 54.5 (65.9) millions. The result after financial items has been negatively affected by the Spanish subsidiary with an amount of SEK -9.6 million. The negative result after financial items has been affected both by the economic irregularities and the time needed to form a new organisation who focus on sales again. The result after financial items has also been negatively affected by the newly established companies in United Kingdom, France, Make Your Own Design in Scandinavia AB and Textwear A/S in Norway with an amount of SEK -11.5 (1.4) millions. From a general point of view all the companies above have a weeker position in the market and have therefore more heavily affected of the decrease in sales in September 2001 than other companies within the group. The acquired companies Sagaform AB and Segerkoncernen AB have contributed positively to the result after financial items with an amount of SEK 1.6 millions. Other companies, i.e excluding the companies mentioned above, where of all, excluding the subsidiary in Spain, shall be regarded as investments in the markets were they operate, have increased their result after financial items during January - September 2001 by 15 percent or SEK 9.7 million. The result after financial items in these companies is estimated to grow substantially during 2002. The gross profit margin increased, compared with previous year, to 38.5 (37.9) percent. External costs increased to 16.2 (16.1) percent of the Group's sales. The costs for personnel increased to 12.1 (10.4) percent of the total turnover. The increased share of invoiced sales for personel costs is mainly due to the decided investments in the United Kingdom, Holland, France, Cyberwave AB (4yourlogo.com), Make Your Own Design in Scandinavia AB, as well as the acquisitions of Textwear A/S and Sagaform AB. Result after financial items for the period October 2000 - September 2001 in comparative figures increased by 16 percent and amounted to SEK 83.7 (72.2) millions. Result after financial items, including previou´s year's refund from SPP of SEK 8.0 millions, increased by 4 percent to SEK 83.7 (80.2) millions. Profiling Business Area During January - September 2001, the Profiling business area's sales increased by 12 percent to SEK 588.0 (527.9) millions. The result after financial items in comparative figures decreased by 15 percent to SEK 45.8 (50.4) millions. Result after financial items, including previous year's refund from SPP of SEK 3.6 millions, decreased by 9 percent to SEK 45.8 (54.0) millions. Retailing Business Area For the period January - September 2001, the Business area's sales increased by 27 percent to SEK 323.6 (255.1) millions. Result after financial items in comparative figures decreased to SEK 8.7 (11.9) millions. The result after financial items, including previous year's refund from SPP of SEK 4.4 millions, increased by 16 percent to SEK 8.7 (7.5) millions. Tax The calculations is done with consideration of the deficit deduction that comes with the acquisition of Dressmart AB. Sagaform AB As of April 1st, 2001, Sagaform AB made a new issue of shares to New Wave. Through this issue, New Wave holds 50.1 percent of the shares in the company. Sagaform has affected the result for the third quarter in 2001 negatively, but is estimated to contribute positively to result during the fourth quarter of 2001. 4yourlogo.com The e-trading site 4yourlogo.com on the Internet has been launched on the Norwegian market during the third quarter. The system is previously launched on Swedish market. The e-commerce system will be launched in all countries where New Wave Group has Profiling Business activities. Segerkoncernen AB New Wave Group has acquired all the shares in Segerkoncernen AB . The day of taking the shares in possession was 1 September 2001. The company is consolidated as per 1 September 2001. In connection with the acquire goodwill amounted to 23.8 SEK millions comes up. Futhermore additional goodwill can come up connected to future additional purchare. The purchase-sum for the shares amounts to SEK 48 millions of which SEK 24 million is paid in cash and the rest by a directed new issue of 150 000 shares at a rate of 160 SEK per share. An additional purchase-sum will be paid during 2003 if the results for 2001 and 2002 in Segerkoncernen AB and its subsidiaries Seger Europe AB and Seger United AB meet certain criterias. For 2002, Segerkoncernen is expected to have a turnover of approximately SEK 150 million with good profitability. New Wave Group intends to integrate Segerkoncernen by letting Seger Europe's assortment complete the assortment of New Wave Group within its Profile Business area which should lead to an increase of sales with regard to the completing products. Seger United will furthermore be a part of New Wave Group's Retail Business area where New Wave Group will become one of the largest suppliers in Sweden with an annual turnover of approximately 500 million SEK. New Wave Group believes that the acquisition will result in extensive positive synergetic effects, mainly within sales, logistics and buyings. The synergetic effects will be presented more closely during the first quarter of 2002. Minority interest The legal proceedings regarding the compulsory purchase of the remaining shares in Texet AB has been completed and New Wave is now the owner of all shares in Texet AB. Compulsory purchase of the remaining shares in Dressmart AB is in process and the arbitration court is expected to announce its decision during the fourth quarter of 2001. Buying and logistics New Wave is always working to improve the buying and logistics and as part of that New Wave will build a logistic centre in the municipality of Munkedal during 2001/2002. The first activities with the building will start during the first quarter 2002, by the latest. Capital tied up On September 30th, 2001, compared with September 30th, 2000, the capital tied up in stock and accounts receivable increased with 31 percent to SEK 933.4 (714.3) millions. Establishments abroad and the acquisitions of Sagaform AB, Segerkoncernen AB and Textwear A/S mainly caused the increase. The increase of capital tied up in stock and accounts receivable for the above mentioned companies and the acquired companies amounts to SEK 197.0 millions. Investments The Group's net investments in fixed assets for the period January- September 2001 amounted to SEK 66.5 (18.8) millions. The net investments for the period is mainly caused by the acquisitions of Sagaform AB and Segerkoncernen AB Financing and Liquidity Cash flow after investments and acquisitions for the period January - September 2001 amounted to SEK -90.5 (-196.2) millions. Liquid assets at the end of September 2001 amounted to SEK 78.0 million compared to SEK 7.8 millions for the same period in 2000. Net borrowing amounted to SEK 705.0 millions compared to SEK 486.2 millions for the corresponding period in 2000, an increase of SEK 218.8 millions. Personnel The number of employees as an average of the last twelve-months is 468 persons (October 2000 - September 2001), compared to 305 last year (July 1999 - June 2000). The increase is mainly due to the establishments abroad, acquired companies Sagaform AB, Textwear A/S and Segervaror AB. CFO Jörgen Bender resigns from the company, and in connection herewith Torsten Jansson has bought Jörgen Benders 17.900 B shares in the company. Views for 2001 The sales during 2001 have been unstable, and during September 2001 the sales was extremely weak. Orders recevied during October 2001 seems to be more normal. New Wave therefore witholds its prognosis to exceed previous years result exkluding the refund from SPP Aquired companies The aquired companies Segerkoncernen AB and Sagaform AB contributes positively to the result after financial items with SEK 1.6 million. Consolidation of Sagaform AB is done as per 1 april 2001 and for Segerkoncernen AB as per 1 september 2001. This means that a big part of the aquired companies sales and result are not included in the groups income statement but in the fund statement both companies are fully consolidated. The increase in the balance sheet amounting to SEK 347.0 millions is mainly due to the aquired companies Sagaform AB and Segerkoncernen AB, which stands for 51 percent of the increase and as part of the total balance sheet 14 percent. At the same time the two companies stands for 6 percent of the total turnover. These two companies are temporarly heavly detoriation, New Wave Groups key figures. The Parent Company For the period January - September 2001, the sales increased by 79 percent amounting to SEK 75.9 (42.5) millions. The profit after financial items amounted to SEK 41.7 (17.0) millions. For the period January - September 2001, net borrowing increased by SEK 125.2 millions and investments by SEK 67.9 (1.1) millions. Account and valuation principles Same principles and valution are used as in the latest annual report. Forthcoming information Report for the period January - December 2001 will be published on February 19, 2001. Report for the period January - March 2001 will be published on April 23, 2001. General shareholder meeting is intended to be held on May 13, 2001. Borås, November 1, 2001 New Wave Group AB (publ) Board of directors For further information, please contact: CEO, Torsten Jansson, Telephone: +46708-998050, +4633-225855. E-mail: torsten.jansson@nwg.se dCEO, Göran Härstedt, Telephone: +46708-998017, +4633-225863, E-mail: goran.harstedt@nwg.se Auditor's Report We have carried out a general review of this interim report, in accordance with the recommendation issued by the Swedish Institute of Public Authorized Accountants (FAR). A general review is considerably limited in comparison with an audit. Based on our review nothing came to our attention that indicates that the report does not comply with the requirements given in the Swedish Stock Exchange Act or the Swedish Annual Accounts Act. Bertel Enlund Per Schwartzman Authorized public Authorized public accountant accountant Ernst & Young AB Ernst & Young AB ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2001/11/01/20011101BIT00750/bit0001.doc The full report http://www.waymaker.net/bitonline/2001/11/01/20011101BIT00750/bit0001.pdf The full report