Interim report January June 2008 Business environment General - - PowerPoint PPT Presentation

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Interim report January June 2008 Business environment General - - PowerPoint PPT Presentation

Jan 16, 2024 108 likes •480 views

Claes-Gran Sylvn, President and CEO Interim report January June 2008 Business environment General slowdown in retail sector Reduced consumer purchasing power affects both slow-moving and fast-moving consumer goods Risk of

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Interim report January – June 2008

Claes-Göran Sylvén, President and CEO

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June Accum. June Accum. Fast-moving consumer goods 3,8 6,3 1,2 Mostly food 4,5 6,4

  • 0,2
  • 0,2

Systembolaget

  • 1,4

4,9 11,6 2,4 Consumer durables 0,9 4,3 4,9 4,8 Pharmacies 3,4 6 4 4,6 Books and paper

  • 1,4
  • 2,2
  • 0,9
  • 0,6

Electronics 0,7 0,7 23 18,1 Jewellers

  • 6,8
  • 3,8
  • 8,6
  • 11,9

Clothes

  • 1,3

1,9 6,1 3,1 Shoes

  • 6,8
  • 4,9
  • 16,9
  • 8,3

Total retail trade 2,3 5,2 3,3 2,7

Business environment

  • General slowdown in retail sector
  • Reduced consumer purchasing power affects both slow-moving and

fast-moving consumer goods

  • Risk of lagging behind in cost inflation
  • Streamlined and innovative businesses are winners

Source: HUI, SCB

Retail Trade Index January – June, 2008 Retail Trade Index January – June, 2008

Current prices Fixed prices, calendar adjusted

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Hakon Invest Apr 1 – Jun 30, 2008

Improved operating profit in second quarter despite slowdown

  • Revenues totaled SEK 301 M (273)
  • Operating profit rose to SEK 191 M (168)
  • Net financial items were SEK -71 M (95)
  • Profit for the period amounted to

SEK 118 M (259)

  • Purchase of additional shares in Hemtex
  • Strong financial position
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SLIDE 5

Operations

Hakon Invest Portfolio companies

Forma Publishing Group, 100% Kjell & Company, 50% Hemma, 61% Cervera, 48%

ICA AB, 40%*

inkClub, 50%

* Remaining 60% is owned by the Dutch company Royal Ahold. According to a shareholder agreement both owners have joint control of ICA AB, through an agreed requirement for unanimity at Annual General Meetings and in the Board of Directors

Hemtex, 18.3%

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  • Positive sales trend in Sweden and the

Baltic countries

  • ICA Norge continues with change program

– Focus on new price positioning to improve competitiveness and profitability

  • ICA Sverige reports strong earnings. Focus
  • n logistics and assortment development

has yielded results

  • Proposal drafted for a new quality standard

in the stores for the industry

  • Rimi Baltic continues to increase sales and

profitability

  • ICA Banken growing with profitability

ICA AB

Strong improvement in underlying earnings in second quarter

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Sales trend for ICA stores

Apr-Jun 2008 Jan-Jun 2008 Change all stores Change comparable stores 6.4 % 0.2 % 14.3 % 4.8 % 2.2 % 11.5 % Sales Sales Change all stores Change comparable stores ICA Sverige SEK 21,749 M NOK 5,005 M EUR 336 M 7.6 % 6.7 % ICA Norge SEK41,897 M NOK 9,701 M 0.0 % 1.5 % Rimi Baltic EUR 637 M 15.1 % 12.6 %

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ICA Group Apr 1 – Jun 30, 2008

  • Net sales

SEK 22,765 M (+10.0%)

  • Operating margin

2.9 % (2.9)

  • Operating profit

SEK 660 M (595) – of which capital gains and property impairments SEK 137 M (215)

  • Profit for the period

SEK 557 M (491)

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ICA Group’s operating profit per segment

SEK M Apr-Jun 2008 Apr-Jun 2007 Jan – Jun 2008 Jan – Jun 2007 ICA Sverige 672

  • 47

66 25

  • 56

660 1,144 843 ICA Norge 503 57 29 19

  • 13
  • 202

122 Rimi Baltic 72

  • 7

ICA Banken 46 34 ICA Group Functions

  • 141
  • 51

Total 595 919 941

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ICA Group operating margin, %

0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 Quarter 1 Quarter 2 Quarter 3 Quarter 4

2005 2006 2007 2008

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Forma Publishing Group Apr 1 – Jun 30, 2008

One of Sweden’s largest publishing houses

  • Revenues SEK 223 M (191)
  • Operating profit SEK 11 M (2)
  • Icakuriren increases revenues for

both circulation and advertising

  • Acquisition of lifestyle magazine Leva
  • Trade magazines increase revenues

with Market and Icanyheter

  • Forma Books improves profitability

despite declining book market in Sweden

  • Good development for contractual
  • perations
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Kjell & Company Apr 1 – Jun 30, 2008

A leading home electronics accessories retailer

  • Revenues SEK 90 M (72)
  • Operating loss SEK 6 M (-8)
  • 34 stores today – 4 new stores
  • pened during the quarter
  • Continued expansion in autumn
  • Electronics industry showed volume

increase but price decrease during first half

  • Kjell & Co less sensitive to price falls

than others in the industry

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Bild Kjell & Co öppning - kommer

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Hemma Apr 1 – Jun 30, 2008

One of Sweden’s largest white goods retailers

  • Revenues SEK 78 M (82)
  • Operating loss SEK 21 M (-9)
  • Tough competition in white goods

market

  • New CEO in August
  • New store in Infra City during autumn
  • Stocks reduced to an effective level
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Cervera Apr 1 – Jun 30, 2008

Nationwide glass and porcelain chain

  • Revenues SEK 72 M (73)
  • Operating loss SEK 9 M (-7)
  • New assortment strategy in place –

clearance of outgoing product range during summer

  • New store layout launched in

Uppsala in August

  • Central warehouse relocated for

improved efficiency

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inkClub Apr 1 – Jun 30, 2008

European leader in online sales of ink cartridges and

  • ther printer accessories
  • Revenues SEK 89 M (85)
  • Operating profit 12 M (10)
  • Improved gross margin
  • Steady increase in customer orders

and average purchases

  • Evaluation of new logistics center in

Europe under way

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Forecast

  • Gloomier expectations among consumers indicate further

slowdown within retail in the autumn

  • Clarity even more important in times of lower economic growth
  • Greater focus on costs – question of setting right priorities
  • Less competition for attractive acquisition candidates and lower

price expectations

  • Several business opportunities
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Financial information

Göran Hesseborn, CFO

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Income statement

SEK M Q2 2008 Q2 2007 Jan-Jun 2008 Jan-Jun 2007 Revenues 301 273 584 427 Cost of goods sold

  • 202
  • 168
  • 383
  • 258

Gross profit 99 105 201 169 Other operating income 4 7 8 7 Selling and administrative expenses

  • 126
  • 135
  • 269
  • 228

Share of profits in JV 214 191 281 320 Operating profit 191 168 221 267 Net financial items

  • 71

95

  • 133

173 Profit after financial items 120 263 88 440 Income tax

  • 2
  • 4

3 331 Profit for the period 118 259 91 771 Earnings per share 0.79 1.64 0.64 4.82

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Holdings January – June 2008

SEK M, 2008 ICA Forma Kjell & Co Hemma Cervera inkClub Revenues 44,064 431 186 153 142

  • 20
  • 7

197 EBIT 919

  • 7
  • 6
  • 27

21 Share of profits 289

  • 2

1 SEK M, 2007 ICA Forma Kjell & Co Hemma Cervera inkClub Revenues 39,490 345 143 170 145

  • 16
  • 5
  • EBIT

941

  • 15
  • 8
  • 10
  • Share of

profits

327 2

  • 3
  • 1
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100 200 300 400 500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Quarter 200 400 600 800 1000 Rolling 4 quarters

Quarter Rolling 4 quarters

  • Excl. Meny

SEK M SEK M 2005 2006 2007 2008

Share of profits in holdings per quarter and rolling trend 4 quarters 2005 – 2008

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Financial position

  • Non-current financial liabilities SEK 77 M (73)
  • Financial assets totaled SEK 1,736 M (2 292)
  • Financial investments under management amounted to SEK

1,695 M

  • Equity/assets ratio: 94.7% (94.4%)

Comparable figures Dec 31 2007

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  • 100
  • 50

50 100 150 200

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Quarter

  • 200
  • 100

100 200 300 400

Rolling 4 quarters Quarter Rolling 4 quarters

SEK M SEK M 2005 2006 2007 2008

Net financial items quarterly and rolling 4 quarters 2005 – 2008

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Breakdown of financial investments Jun 30, 2008

Hedge funds 44% (35) Fixed income securities 36% (24) Equities 5% (29) Cash and cash equivalents 15% (12)

Total value at Jun 30: SEK 1,695 M (Total value at Dec 31: SEK 2,237 M)

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Return on investment management

  • 15
  • 10
  • 5

5 10 15 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Quarter Hakon Invest SIX Portfolio Return

2006 2007 2008

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Profit per quarter and rolling 4 quarters 2005 – 2008

  • 100

100 200 300 400 500 600 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Quarter 200 400 600 800 1000 1200 1400 1600 Rolling 4 quarters Quarter Rolling 4 quarters SEK M SEK M

2005 2006 2007 2008

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Profitability, %

Source: Hakon Invest. Calculated on rolling 12-month basis

Q2 2008 Q2 2007

Return on capital employed 6.8 13.3 Return on equity 7.1 16.8

2 4 6 8 10 12 14 16 18 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 % Return on capital employed Return on equity

2007 2006 2008 2005

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Cash flow statement

Group, SEK M Jan – Jun 2008 Jan – Jun 2007 Cash flow from operating activities 428 387 Cash flow from investing activities 58

  • 19

Cash flow from financing activities

  • 480
  • 362

Cash flow for the period 6 6 Cash and cash equivalents at beginning of period 281 349 Exchange differences in cash and cash equivalents Cash and cash equivalents at end of period 287 355

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Share price trend

Share price development YTD 2008

  • Share price -33% YTD comp. OMXS index -21%
  • Dividend SEK 6.00
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