be group year-end report 20151 earnings per share after dilution 2 cash-flow after investments 3...
TRANSCRIPT
Slide 1
Anders Martinsson, President and CEO
Andreas Karlsson, CFO
BE Q4
BE GROUP
YEAR-END REPORT 2015
Slide 2
Q4 – Increase in shipped tonnage
Financial highlights
Shipped tonnage increased by 1%
Net sales decreased by 3%
Gross profit of SEK 112 M (124)
Underlying operating result (uEBIT) of SEK -12 M (-9)
Operating result (EBIT) of SEK -17 M (-30)
Net profit SEK -23 M (-45)
Slide 3
Operational highlights
Increased shipped tonnage and sales in BA Sweden despite weak demand and lower prices
BA Finland tonnage in-line with Q4 2014
Tonnage in Czech and Slovak markets remains low due to demand situation and more restrictive view on credit exposure
Gross margin affected by under absorption in Finnish production and lower prices
Costs lower compared to Q4 2014
Market situation
Challenging market conditions remains
Demand in the Swedish market stabil, but down compared to Q4 2014
Demand dropped in the Finnish market in October
Steel prices decreased during the quarter
Slide 4
FINANCIALS IN DETAIL
Slide 5
Quarterly comparison to last year
SEK M Q1 Q2 Q3 Q4 FY
Net sales 2014 1 083 1 112 998 1 009 4 202
Net sales 2015 1 104 1 104 966 981 4 155
Change 2% -1% -3% -3% -1%
Operating result 2014 13 3 -3 -30 -17
Inventory losses 4 1 0 1 6
Non-recurring items 0 0 9 20 29
Underlying operating result 2014 17 4 6 -9 18
Tonnage-, price- and mix effects 2 0 -4 -4 -6
Change in underlying gross margin -1 7 8 -5 9
Change in overhead costs etc. -6 1 0 6 1
Underlying operating result 2015 12 12 10 -12 22
Inventory gains/losses -2 -2 -3 -5 -12
Non-recurring items 0 0 -124 0 -124
Operating result 2015 10 10 -117 -17 -114
Slide 6
Q4 tonnage – Tonnage stronger than in Q4 2014
Growth in tonnage and sales (%) Net sales decreased by 3% vs Q4 2014
Q4 Jan-Dec
Change in Net Sales -3% -1%
Tonnage +1% -1%
Price/Mix -4% -2%
Currency 0% +2%
FY tonnage growth in main business areasQ4 Jan-Dec
Change in tonnage +1% -1%
Sweden +2% +4%
Finland 0% +3%
Other Units +1% -19%
-2%
-6%
-11% -11%-10%
-1% -1%
-3%
1%
-15%
-10%
-5%
0%
5%
10%
Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Tonnage Net Sales
Slide 7
Underlying gross margin – Improvement compared to FY
2014
Q4 underlying gross margin of 12.0% (12.5)
High production under absorption in Finland and weaker prices have put pressure on margins in Q4
YTD underlying gross margin 12.9% (12.7)
More sales in BA Sweden and BA Finland have positive effect on margin
Margin improvements continue to be a focus area in competitive market
Sales and administration costs below last year
Continued tight cost control
Overhead costs (SEK M) and margin (%)
136130 134
120
134 135 134
118130
5%
7%
9%
11%
13%
15%
0
50
100
150
200
250
Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Un
derl
yin
g g
ross m
arg
in
Ov
erh
ead
co
sts
Overhead costs SEK M Underlying gross margin %
Slide 8
Working capital development
Working capital (SEK M)
Period-end working capital increased by SEK 99 M compared to last year
Inventory reduction at the end of the quarter caused lower than normal outstanding accounts payable
Less sales in Czech and Slovakia
Factoring used to limit credit risk
Longer payment terms to suppliers
Average working capital tied-up 14.0% (11.2)
388
436465 479
426
486512
575
525
0%
5%
10%
15%
0
100
200
300
400
500
600
700
Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Working capital (period end) Working capital tied-up (average)
Slide 9
Cash-flow
Q4 operating cash-flow ofSEK 37 M (49)
Investment cash-flow of SEK -6 M (-3)
Operating cash-flow FY 2015 SEK -93 M
Higher working capital
Net debt of SEK 609 M (754)
Cash-flow from operating activities (SEK M)
42
-48
-18-8
49
-54
-28
-48
37
-100
-75
-50
-25
0
25
50
75
100
Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Cash-flow from Op. activities Cash-flow from Op. activities R12
Slide 10
BUSINESS AREAS
STATUS Q4 2015
Slide 11
BA Sweden – Continued sales growth compared to last
year
Market demand lower compared to last year
Tonnage increased by 2% vs Q4 2014
Net sales amounted to SEK 441 M (439)
EBIT of SEK 5 M (5) and uEBIT of SEK 6 M (5) in Q4 2015
Sales, EBIT and uEBIT (SEK M)
439485 497
414441
-60
-40
-20
0
20
40
60
-600
-500
-400
-300
-200
-100
0
100
200
300
400
500
600
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
EB
IT
Sa
les
Net sales, SEK M Underlying EBIT, SEK M EBIT, SEK M
Slide 12
BA Finland – Stable tonnage in weak market but falling
prices caused drop in sales
Market demand dropped in October
Tonnage flat compared to Q4 2014
Net sales decreased by 6% compared to Q4 last year
EBIT of SEK -7 M (5) and uEBIT of SEK -3 M (7) in Q4 2015
Sales, EBIT and uEBIT (SEK M)
431461 453
424407
-10
-5
0
5
10
15
20
25
30
-200
-100
0
100
200
300
400
500
600
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
EB
IT
Sa
les
Net sales, SEK M Underlying EBIT, SEK M EBIT, SEK M
Slide 13
Other Units – Challenging conditions in Central Europe
continues
Challenging market in Central Europe
Tonnage in Czech and Slovak markets on the same low level as in Q4 2014
Net sales decreased by 3% vs Q4 2014
EBIT of SEK -9 M (-26) and uEBIT of SEK -9 M (-7) in Q4 2015
Sales, EBIT and uEBIT (SEK M)
154178 174
146 150
-100
-80
-60
-40
-20
0
20
40
60
80
100
-250
-200
-150
-100
-50
0
50
100
150
200
250
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
EB
IT
Sa
les
Net sales, SEK M Underlying EBIT, SEK M EBIT, SEK M
Slide 14
OUTLOOK
Slide 15
Current business situation and outlook
Some recovery in demand expected on the Finnish market
No significant changes in demand expected on other markets
Steel prices are expected to be flat for the coming quarter
Structural changes in the market continue to give opportunities for BE Group
Slide 16
Current focus areas
Margin improvements
Continued focus on high sales activity
Cost control
Turn Other Units profitable
Review structure and establish more decentralized responsibility for profit
Slide 17
Q&A
Slide 18
APPENDIX
FINANCIAL
INFORMATION
Slide 19
FY FY Change
SEK M 2015 2014
Net sales 4,155 4,202 -47
Underlying EBIT 22 18 +4
% of Sales 0.5% 0.4% +0.1%
Inventory gains/losses -12 -6 -6
Non-recurring items -124 -29 -95
EBIT -114 -17 -97
% of Sales neg neg -%
Financial net -48 -55 +7
Earnings before tax -162 -72 -90
Net earnings -169 -73 -96
Number of shares period end (M) 259.7 74.2 +185,5
EPS (SEK) -0,97 -1,07 +0,10
Operating Cash-flow -93 -25 -68
January – December
Slide 20
Dec Dec Change
SEK M 2015 2014
Non-current assets 907 1,091 -184
Inventories 546 565 -19
Accounts Receivable 409 407 +2
Other Receivables 66 80 -14
Cash 33 73 -40
Total Assets 1,961 2,216 -255
Equity 785 715 +70
Interest bearing liabilities 642 827 -185
Accounts payable 353 498 -145
Other liabilities 181 176 +5
Total Equity and liabilities 1,961 2,216 -255
Working Capital 525 426 +99
Net Debt 609 754 -145
Gearing 78% 105%
Balance sheet
Slide 21
Appendix: Financial summary
1 Earnings per share after dilution 3 Period end working capital2 Cash-flow after investments
FY FY
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015 2014Tonnage 109 110 95 97 108 108 93 97 406 411
Net sales 1,083 1,112 998 1,009 1,104 1,104 966 981 4,155 4,202
Underlying EBIT 17 4 6 -9 12 12 10 -12 22 18
% of sales 1.5% 0.3% 0.6% -0.9% 1.1% 1.1% 1.0% -1.2% 0,5% 0.4%
EBIT 13 3 -3 -30 10 10 -117 -17 -114 -17
% of sales 1.2% 0.3% -0.3% -3.0% 0.9% 1.0% -12.1% -1.7% -2,8% -0.4%
Net earnings -5 -7 -16 -45 0 -13 -133 -23 -169 -73
Earnings/share1 -0.10 -0.10 -0.22 -0.61 0.00 -0.12 -0.51 -0.09 -0.97 -1.07
Cash-flow2 -48 -20 -8 46 -58 -32 -50 31 -109 -30
Working capital3 436 465 479 426 486 512 575 525 525 426
2014 2015
Slide 22
Appendix: Tonnage development
Tonnage (‘000 tons)
108 109 110
95 97
108 108
9397
0
100
200
300
400
500
0
25
50
75
100
125
Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Quarterly (LHS) Rolling 12 months (RHS)
Slide 23
Appendix: Sales per product area
303
371
43
198
46
323
384
49
201
47
0% 10% 20% 30% 40% 50%
Stainless
steel
Aluminum
Other
Flat
steel
Long
steel
2015 2014
Q4 – Share of total sales (MSEK)
Slide 24
Appendix: Sales per channel
Q4 – Share of total sales (MSEK)
136
466
379
137
502
370
0% 10% 20% 30% 40% 50% 60%
Service
Inventory
Direct
Note: Sales outside scope of channels not included
2015 2014