Continued sales and profit growth
We have seen greater demand for our services compared with 2010, which has meant increased sales and improved results for the first half of the year. Saab Automobile’s financial problems have meant that results were negatively affected by SEK 31 million, mainly for reserves of outstanding accounts receivable. The sound market situation means that we now have a major need to recruit on all markets. The outlook for 2011 is positive and we expect to see continued profit improvements. Kjell Nilsson, President & CEO
Q2
• The operating income was SEK 609 million (516) and organic growth was 22%
• The operating loss was SEK 12 million (-25) giving an operating margin of -2.0% (-4.8)
• Results were negatively affected by reserves of a one-off nature of SEK 31 million (-8)
• The loss after tax was SEK 10 million (-19)
• Earnings per share after dilution was SEK -0.58 (-1.07)
January-June
• The operating income was SEK 1,205 million (1,037) and organic growth was 21%
• The operating profit was SEK 30 million (-29) giving an operating margin of 2.5% (-2.8)
• Results were negatively affected by reserves of a one-off nature of SEK 31 million (-8)
• The profit after tax was SEK 18 million (-24)
• Earnings per share after dilution was SEK 0.97 (-1.33)
• The equity/assets ratio was 33% (31)
Income and result
Q2
Operating income rose by SEK 93 million compared to last year and amounted to SEK 609 million (516). Sales in local currencies rose by 22%. The sales growth is a result of the better state of the market and has led to a higher utilization rate in all business areas. The number of employees has meanwhile risen by 251, compared with Q2 2010. In relation to the first quarter Q2 had four fewer working days, which affects income and results.
The operating profit improved by SEK 13 million and amounted to SEK -12 million (-25), giving an operating margin of -2.0% (-4.8). Although there is still a high degree of uncertainty surrounding Saab Automobile’s solvency a reserve has been made of SEK 31 million, mainly for outstanding accounts receivable. Because of this reserve there is no outstanding exposure towards Saab Automobile. The same quarter last year was hit by one-off costs of SEK 8 million. The operating profit, excluding these items, was SEK 19 million (-17) with an operating margin of 3.1% (-3.2).
Net financial items amounted to SEK -3 million (-2) giving a loss before tax of SEK 15 million (-27). Tax revenues for the quarter amounted to SEK 4 million (8). The loss after tax was SEK 10 million (-19) and the earnings per share after dilution was SEK -0.58 (-1.07).
January-June
The operating income rose during the period by SEK 168 million compared to last year and amounted to SEK 1,205 million (1,037). Sales in local currencies rose by 21%. The sales growth is mainly the result of the better market situation compared to the same period last year.
The operating profit improved by SEK 59 million and amounted to SEK 30 million (-29) giving an operating margin of 2.5% (-2.8). Results were hit by one-off costs of SEK 31 million (-8). The operating profit, excluding theses items, was SEK 61 million (-21) with an operating margin of 5.0% (-2.0).
The business areas show the following operating margins, excluding one-off costs: Automotive R&D 1.3% (-8.0), Design & Development 8.7% (2.8) and Informatic 10.3 % (6.5).
Net financial items amounted to SEK -6 million (-4) giving a profit before tax of SEK 24 million (-33). Tax costs for the year stood at SEK 7 million (9). The profit after tax was SEK 18 million (-24) and the earnings per share after dilution was SEK 0.97 (-1.33).
Financial position
The operating cash flow from current activities was SEK 8 million (-67). The Group’s cash and bank balances amounted to SEK 33 million (33) with additional non-utilized credit of SEK 140 million as at 30 June. A new credit agreement was signed at the beginning of Q3. The new credit agreement consists of an overdraft facility of SEK 150 million (100) and a revolving credit facility of EUR 32.8 million (32.8), which runs until July 2012. There is an option available for the company, before the due date, to extend the revolving credit to a three-year loan.
Investments in hardware, licenses, office supplies and equipment, amounted to SEK 9 million (8). Shareholders’ equity amounted to SEK 390 million (359) and the equity/assets ratio was 33% (31). The Group’s net debt was SEK 313 million (332) and the debt/equity ratio was 0.8 times (0.9).
Staff and organization
The headcount on 30 June was 2,837 (2,586), of whom 1,489 (1,427) in Sweden and 1,348 (1,159) abroad. The number of employees in active service was 2,719 (2,438). Compared with year-end 2010 (31 Dec) the number of employees has risen by 134, of whom 57 in Sweden and 77 abroad. In the respective business areas the number of employees is as follows: Automotive R&D 1,625 (1,463), Design & Development 793 (760) and Informatic 419 (363).
Outlook
We have seen a clear improvement in the market situation since the second half of 2010. The good market situation means that we have a major need to recruit on all markets. Our outlook for 2011 is positive and we expect to continue seeing profit improvements.
Kjell Nilsson, CEO Semcon AB, 46-31-721 03 11
Björn Strömberg, CFO Semcon AB, 46-708-35 44 80
Anders Atterling, IR manager Semcon AB, 46-704-47 28 19
Semcon is a global company active in the areas of engineering services and product information. The Group has more than 2,800 employees with extensive experience from many different industries. We develop technologies, products, plants and information solutions along the entire development chain and also provide many services including quality control, training and methodology development. Semcon boosts customers’ sales and competitive strength by providing them with innovative solutions, design and solid engineering solutions. The Group has sales of SEK 2.1 billion and activities at more than 40 sites in Sweden, Germany, the UK, Brazil, Hungary, India, China, Spain, Norway and Russia
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