bilia company presentation 2015

Company presentation 2015

Everything related to the car. And then some.

ContentsBusiness model 2Statement by the Managing Director 4Vision and business concept 6Core values 8Sustainable development 10Service Business 12Car Business 14Financial overview 16Group overview 17Sweden 18Norway 20Germany / Denmark 22Share, AGM and important dates 24

>> Bilia is one of Europe’s biggest car dealership chains with operations in Sweden, Norway, Germany and, from 2016, Luxembourg.

Bilia off ers car sales, service and supplementary services and strives to have the most satisfi ed customers in the business. The Service Business includes service and damage centres, spare parts, car washes, stores, tyre and glass centres and other accessory services.

The Car Business includes both new and used cars and transport vehicles. The car brands Bilia off ers are Volvo, BMW, Ford, Renault, Toyota, Lexus, Dacia, Hyundai and MINI. The Fuel Business comprises the sale of fuels in Sweden and Norway.

Notable events during the year• The operation in Denmark was discontinued during the

year. • Bilia acquired Toyota Hell Bil AS and Toyota Horten-

Tønsberg AS in Norway. Date of possession 1 March.• The Swedish pension liability for ITP 2 was redeemed as

of 1 May. • A stock split was carried out on 28 May where each

existing share was split into two new shares. • Bilia raised its fi nancial goals in wake of the

discontinuation of the operation in Denmark.• Bilia terminated the sales agreements for new Ford cars

in Sweden and Norway in October. Bilia will retain the workshop agreements for service and repairs.

• Bilia acquired the Lexus dealer Kaiser Bil AB in Sweden. Date of possession 1 October.

• Bilia acquired Dörr & Hess, a dealer for BMW and MINI in Germany. Date of possession 1 October.

• Bilia acquired Hedbergs Bilskrot AB and Bastborren Fastighets AB in Sweden. Date of possession 1 January 2016.

• Bilia signed an agreement to acquire Arnold Kontz’s BMW and MINI operation in Luxembourg. The estimated date of possession is 31 March 2016.

Events after the balance sheet date• Bilia signed agreements to acquire one BMW and

MINI dealer and two Toyota dealers in Sweden. The estimated date of possession is March 2016, contingent on the approval of the Swedish Competition Authority.

Bilia expands in Europe

Number ofdelivered new cars

41,102Number of

delivered used cars

37,542Turnover Car

Business, SEK M

15,694

Total turnover,SEK M

20,443

Number of employees

3,613Number of service

subscriptions

59,600Number of

stored wheels

192,600

Turnover Fuels, SEK M

1,021

Turnover ServiceBusiness, SEK M

4,491

Earnings per share, SEK

12.85

Number of facilities

106

1

>> Bilia is a full-service supplier, a One Stop Shop, with a complete range of products and services in both the Car and Service Businesses. Our business model is based on putting the customer in focus and creating an off er around everything to do with the car as long as the customer owns it.

The customer can get all car-related needs dealt with in a single visit.

Based a strong customer focus, Bilia is constantly developing the company’s off ering to meet the needs of the customer and the car. Bilia has several of the strongest and most popular car brands on the market, which strengthens the Car Business and stimulates new business to foster a long-term customer relationship.

When, for example, customers choose fi nancing solutions via Bilia, they enter into a long-term relationship. When an insurance policy is sold together with the car, this ensures that Bilia will handle any necessary future damage repairs. This makes life simpler for the customers, who can manage their entire car ownership via a single supplier.

Service subscriptions off er a number of advantages for customers in the form of convenience and competitive prices. The advantages for Bilia are a steady work fl ow and the ability to schedule service in good time. This strengthens the customer relationship and gives us an opportunity to present our entire off ering.

In addition to service and damage centres, Bilia also has other products and services such as auto glass and tyre centres, paint and glass treatment, dent removal, accessories, reconditioning, car washes, rental cars and fuels. For the car owner, it is an advantage to be able to get all car-related needs dealt with in a single visit.

Bilia’s close cooperation with leading car and tyre manufacturers and other business partners gives the employees special expertise in such areas as automotive electronics, tyres and auto glass, which creates added value for the customer. Bilia’s tyre hotels make life easier for the customer and enable Bilia to keep track of the customer’s diff erent tyre needs. Independent car inspection companies are situated adjacent to some of Bilia’s facilities.

The Bilia card (available in Sweden) is of central importance for Bilia’s services and products and enables the customer to gather all car costs on a single invoice.

Bilia’s size off ers economies of scale, leading to competitive prices for products and services. Accessibility is high; it is always possible to get in touch with well-trained personnel who work to give the customer the best possible service.

Bilia – a full-service supplier

2 Business model

FinancingInsuranceBilia cardAccessories

Service subscriptionPaint treatmentGlass treatmentTyre sales

Tyre hotelFuelsCar washStore

Glass repairRental carService centres & PSTWheel change

Spare partsAC cleaningDent removalReconditioning

Roadside assistanceDamage centreRepairsTrade-in

3

The economic climate in Sweden has been favourable. We broke new records in terms of profitability and can look back on a good year. As far as Norway is concerned, we can observe that plug-in hybrids are advancing their position on the market and that we managed to do well despite low oil prices, which affected consumption.

The winding-up of our operation in Denmark has now been completed. The five facilities have been sold, and virtually all personnel have found new employment, which is gratifying.

Our growth strategy continues. In Norway we have acquired a Toyota and Lexus dealer with eight facilities and an annual turnover of about SEK 1 billion.

Lexus has been added as a new brand in Sweden as well with the acquisition of four dealerships in Stockholm and Malmö which together account for 42 per cent of the brand’s sales in the country.

The acquisition of a BMW dealer in Germany, with four facilities north of Frankfurt and an annual turnover of over SEK 500 M, represents Bilia’s entry into the European market.

Our tyre and glass services are taking market share. Bilia’s tyre hotels currently have 192,600 wheels in storage, and we are expanding our storage capacity. The tyre hotels are important in promoting stronger customer relationships. Each meeting with the customer is an opportunity to fulfil our strategy to be a full-service supplier.

The focus of recent years on attracting customers with older cars to our aftermarket services is continuing.

Bilia has initiated a discontinuation of the Ford brand, which has long shown poor profitability. Instead of making big investments for the brand in both Sweden and Norway,

we chose to terminate the sales agreements. Ford sales will cease at the end of 2017, but we will retain our involvement on the aftermarket.

The Group’s operating profit, excluding items affecting comparability, amounted to SEK 731 M (553). The improvement is due to the positive performance of both the Service and Car Businesses during the year. The Service Business showed slightly improved demand, which – together with efforts to promote service subscriptions, tyre hotels and add-on sales – led to a significant earnings improvement compared with 2014. Earnings in the Car Business also improved, mainly due to better profitability in used car sales.

Customer satisfaction is one of our most important success factors. Bilia has developed its own methodology, RACE, for improving the way we deal with customers. We report the results of the customer surveys continuously on our websites. The annual employee survey is also important, since satisfied employees are a prerequisite for satisfied customers.

At the end of December we concluded an agreement to acquire a profitable BMW dealer in Luxembourg, with an annual turnover of about SEK 1 billion. The acquisition also provides a good base for further growth with BMW in neighbouring markets such as Belgium and Germany.

With several months’ perspective on 2015, I think we can look back on a successful year with strong acquisitions, good earnings and new exciting opportunities ahead of us.

Gothenburg, March 2016 Per AvanderManaging Director and CEO

>> 2015 was a year with good demand for cars, high capacity utilization at our workshops and strong earnings. It was also the year when we wound up our business affairs in Denmark after many years of poor profitability and took a new step out into Europe.

A year with strong profitability

4 Statement by the Managing Director

The acquisition of the BMW dealer in Germany represents Bilia’s entry into the European market.

5

Operating margin Return on capital employed Return on equity Growth

VisionOur vision is to be the best service company in the business.

Business conceptBilia’s business concept is to offer car service, car sales and supplementary services that give the customers lasting added value.

StrategyBy means of a clearer customer focus with more services and products, Bilia will create the necessary conditions for cost-effective and profitable growth.

Success factorsCompared with our competitors, Bilia enjoys a number of advantages. Based on these advantages we will develop our business by means of:

• a strong focus on the customer and a constant striving to offer better service.

• car sales that tie the customer to Bilia on the service market.

• further development of the concept of Personal Service Technicians to strengthen customer relationships.

• highly qualified and ambitious employees who strive to develop so they can give our customers the best possible service.

• identification and development of leaders within Bilia.• centralisation of functions to achieve cost, competence

and quality benefits, for example within purchasing, administration, human resources, marketing, IT and delivery administration.

• a strong brand. Bilia has a wide range of products and brands in both the Service and Car Businesses.

• dealerships with high accessibility where the customer can contact us round the clock and make appointments via our websites.

Our vision is to be the best service company in the business>> In order to fulfil Bilia’s customer promise – All the Way – we must be a full-service supplier that helps customers with everything related to their car. And then some.

ROCE was 36.2 per cent in 2015 (19.8).

0

10

20

30

40

0

10

20

30

40

0

1

2

3

4

2013 2014 2015 2013 2014 2015 2013 2014 2015%

Goal, at least 2.5 %

Goal, at least 17 %

Goal, at least 18 %

% % 2013 2014 2015%

Rörelsemarginal Avkastning sysselsatt kapital Avkastning eget kapital Tillväxt

Goal,5–10 %

0

5

10

15

ROE amounted to 33.2 per cent in 2015 (21.0).

0

10

20

30

40

0

10

20

30

40

0

1

2

3

4

2013 2014 2015 2013 2014 2015 2013 2014 2015%


Goal, at least 17 %

Goal, at least 18 %

% % 2013 2014 2015%


Goal,5–10 %

0

5

10

15

Growth in the Service Business was 12.8 per cent, in the Car Business 11.0 per cent and in the Fuel Business –2.8 per cent.

0

10

20

30

40

0

10

20

30

40

0

1

2

3

4

2013 2014 2015 2013 2014 2015 2013 2014 2015%


Goal, at least 17 %

Goal, at least 18 %

% % 2013 2014 2015%


Goal,5–10 %

0

5

10

15

Financial goals

0

10

20

30

40

0

10

20

30

40

0

1

2

3

4

2013 2014 2015 2013 2014 2015 2013 2014 2015%


Goal, at least 17 %

Goal, at least 18 %

% % 2013 2014 2015%


Goal,5–10 %

0

5

10

15

Excluding items affecting comparability, the margin was 3.6 per cent (3.0).

The financial goals were raised in 2015.

6 Vision and business concept

7

As a Personal Service Technician, I can offer the customer a higher level of service. I can go the extra mile, so to speak.Emil Mellbom, Personal Service Technician

To live up to and exceed customer expectations, dedicated and qualified employees are essential. Bilia therefore trains its employees continuously as a natural part of their work. Job satisfaction is measured regularly, and the surveys reveal very satisfied employees and a positive trend. All Bilia employees represent the Bilia brand and vision: to be a full-service supplier that offers products and services for all aspects of car ownership.

AccessibilityIt should always be possible to get in touch with Bilia. The company is represented by facilities in several countries and has a large network of authorised service workshops. The company’s websites have more than 19,000 visitors per day, and the range of services is under constant development.

Major improvements were made to bilia.se and bilia.no in 2015, resulting in easier navigation, new booking flows and better adaptation to mobile phones and tablets. The improved websites offer clearer links to booking of service, wheel changes and test drives. The customers can also chat with us online and visit Bilia’s Webshop to purchase accessories, tyres and spare parts. All new and used cars in stock are posted on Bilia’s websites. Netbil.se is a car auction site for private and corporate customers.

Bilia is active on social media for the purpose of marketing and communication with its customers. Social media are also effective channels for quickly snapping

up and responding to viewpoints from our customers. Bilia recently started a project to further strengthen our presence on social media.

Telephone accessibility is measured regularly, and the objective is to answer at least 95 per cent of all phone calls within 30 seconds. Our joint customer service Bilia Nu (Bilia Now) is accessible round the clock via telephone and online chat.

InterestInterest in the customer’s needs is fundamental for achieving Bilia’s vision of being the best service company in the business. Customer satisfaction is monitored daily via Mystery Shopping and other customer surveys to ensure that the ambitious goals are met. Bilia’s CRM system is an important tool that makes it easier to strengthen the customer relationship. It is through a genuine interest in the customer that Bilia is able to help customers with everything having to do with car ownership.

Attractive car ownershipBilia is responsive to customer demands and continuously develops its range of products and services. To enable Bilia to offer attractive car ownership, it is also important to monitor customer satisfaction by means of regular surveys. These surveys were expanded in 2015 to include used car sales as well.

Accessibility, Interest and Attractive Car Ownership>> Happy customers are crucial for Bilia as a service company. This is reflected in the customer promise and in Bilia’s core values: Interest, Accessibility and Attractive Car Ownership.

8 Core values

I try to convey the enthusiasm I feel for the brand to the customer. It’s about selling an experience.Erik Börnstedt, Selling Sales Manager

9

The goal of Bilia’s environmental eff orts is that products and services should have as little impact on the environment as possible. During the year, the process of converting to energy-saving and mercury-free LED light sources has been a priority environmental goal.

In previous years, Bilia has also invested in modernised ventilation. The number of chemical products has decreased drastically, and many products have been replaced with products with a lower environmental impact. Water-based paints have been used for several years in all paint coats except for the clear coat. All waste water at Bilia’s car washes is treated to eliminate the risk that heavy metals, oil and chemicals will leak out into the environment. Bilia washes more than 100,000 cars a year in eco-labelled car washes.

There are well-established routines for managing waste. All waste oil from the service departments is collected and recycled, as are worn-out tyres that have been replaced at Bilia’s tyre centres. Old car batteries are also recycled in a safe manner. Bilia reports to CDP, an organisation that provides information to investors and other stakeholders all over the world on the climate impact of listed corporations and what they are doing to reduce carbon emissions.

Reduced climate impactSince 2013, carbon dioxide emissions are measured for most company cars used in Bilia’s operations in Sweden. These fi gures serve as a basis for new objectives to reduce the climate impact of business travel in the company.

Bilia’s system for video and telephone conferences has been expanded during the year and has helped reduce business travel within the Group; thousands of hours of meetings per year are held today via video. Most of Bilia’s employees in Sweden have undergone training in environment and fi re protection. Most of Bilia’s facilities are environmentally certifi ed to ISO 14001. Read more about Bilia’s environmental work at bilia.com.

Social responsibilityBeing a responsible member of society is important to Bilia, and the Group supports the Swedish Childhood Cancer Foundation in recurrent campaigns. Bilia also supports the World Childhood Foundation by, for example, donating a sum for each new Volvo that is sold. In the wake of the disastrous refugee situation in Europe this past year, Bilia has also donated money to UNHCR. As is their tradition, Bilia’s Facebook followers voted to choose a recipient for this year’s Christmas gift: the Swedish Child Diabetes Foundation.

In 2016, a project will be initiated to determine how Bilia can contribute more to a better society.

SuppliersBilia has high standards in the area of quality and environment. Cooperation partners are expected to comply with the quality requirements in ISO 9001 and the environmental requirements in ISO 14001. When Bilia enters into agreements with suppliers where Bilia’s standard conditions are included, the supplier is required

>> Contributing to a sustainable society is important for Bilia. The Group works with this issue on several diff erent levels. This commitment extends from reducing the company’s own energy consumption and environmental impact to creating a better society.

Our commitment extends far beyond the showroom

10 Sustainable development

to adhere to all of the UN’s ten Global Compact principles. The Global Compact covers four areas: human rights, labour, environment and anti-corruption. The vehicle manufacturers that deliver to Bilia support the Global Compact.

Code of ConductThe Group’s Code of Conduct is intended to ensure that Bilia adheres to strict ethical guidelines in order to strengthen relationships with customers, suppliers,

employees and the rest of society. The Code regulates Bilia’s core values and eff orts on behalf of human rights, the environment, combating discrimination, promoting gender equality, anti-corruption eff orts, handling of confl icts of interest, information disclosure and security, and adherence to competition rules and other laws and ordinances on all the company’s markets.

The Code of Conduct can be read at bilia.com/en under the tab “The Company”.

Energy consumption at Bilia’s facilities in 2015 (GWh)

80.980.0 GWh, 2014

Recycled batteries at Bilia’s facilities in 2015 (tonnes)

12593 tonnes, 2014

Recycled tyres at Bilia’sfacilities in 2015 (tonnes)

844810 tonnes, 2014

11

Bilia’s parts departments assist the company’s work-shops. Bilia’s stores sell spare parts and accessories. There is also a large wholesale operation within the Group.

The successful concept of Personal Service Technicians has been further developed and introduced at more facilities. Thanks to a complete range of services and products for attractive car ownership, Bilia has more satisfied customers and more need sales.

To meet the customers’ increasingly complex needs, Bilia is working to expand its range of products and services in the Service Business.

It is easy to make appointments for service on Bilia’s websites. Our stores and our webshop offer a wide range of accessories such as roof boxes, bike racks and child car seats.

The tyre and wheel business continues to grow, and Bilia’s tyre centres offer tyre storage (tyre hotel), wheel alignment etc. One step in streamlining the work in the workshops is the use of equipment that automatically measures the tyres’ tread depth, pressure and oblique wear.

When they purchase a car, customers in Sweden and Norway are offered service subscriptions, which strengthens the customer relationship. At the end of the year, Bilia had some 59,600 active service subscriptions.

The Bilia card is an easy way for customers in Sweden to gather their car costs and get a bonus on their purchases. Today more than 271,000 Swedish car owners have a Bilia card.

Events during the year Turnover in the Service Business increased in Sweden and Norway. Repair operations, which account for approximately 20 per cent of the total Service Business, reported much higher turnover during the year.

Bilia intensified its campaigns for the Service 6+ concept for older cars. The concept contributes to more workshop hours and increased need sales. The number of older cars at our workshops declined slightly during the year. We are not satisfied with the outcome and are continuing our promotional efforts during 2016.

Earnings Operating profit in the Service Business amounted to SEK 479 M (402). The improvement is mainly attributable to higher turnover, which, after adjustment for acquisitions and disposals, increased by about 6 per cent.

Challenges and opportunities The safety systems in new cars reduce the frequency of damage, resulting in fewer labour hours at the workshops. Bilia is therefore continuing its campaign to attract owners of older cars (6+). Efforts are also continuing to promote need sales of tyres, auto glass, brake fluid etc. The Service Business benefits when more customers sign different types of subscription agreements.

>> Bilia has authorised workshops in Sweden, Norway and Germany that offer service and repairs. The Group’s damage centres do body and paint work, mainly on behalf of insurance companies.

Complete range for a good customer relationship

12 Service Business

Service Business• Service centre • Damage centre• Spare parts • Car wash• Stores and webshop • Tyre centre• Glass centre • Accessory services

2013

2014

2015

Net turnover, SEK M 4,050 3,981 4,491 Share of turnover, % 22 21 21 Operating profi t, SEK M 351 402 479 Operating margin, % 8.7 10.1 10.7Number of employees 2,386 2,459 2,490Number of service agreements 36,000 53,800 59,600Number of wheels in storage 161,000 187,800 192,600

13

Altogether, Bilia has about 70 dealerships in Sweden, Norway and Germany that offer Volvo, BMW, Ford, Renault, Toyota, Lexus, Dacia, Hyundai and MINI cars as well as Renault, Ford, Dacia and Toyota transport vehicles. The new car business is divided into a private market and a corporate market. Of the 37,490 new cars delivered in 2015, about 55 per cent went to corporate customers and 45 per cent to private customers.

Sales of used cars are handled in a separate organisation with a strong focus on rapid turnover. Last year this business recorded its best earnings in the company’s history.

Financing is an important part of car sales and can also be a prerequisite for the customer to be able to buy the car. Bilia cooperates with Volvofinans Bank AB, DNB and the different brands’ own finance companies.

Events during the year Bilia acquired a Toyota and Lexus operation in Norway at the beginning of the year. A Lexus operation located in Stockholm and Malmö and representing 42 per cent of the brand’s total sales in Sweden was acquired at the end of the year. Furthermore, Bilia acquired a BMW operation in Germany with four facilities north of Frankfurt.

The trend of streamlining sales with brand-specific facilities has grown stronger, which is an advantage for Bilia since we represent strong brands and have large volumes.

Earnings Operating profit in the Car Business amounted to SEK 286 M (185). The improved profit is mainly attributable to increased sales and a higher gross profit margin from sales of used cars.

Challenges and opportunities Bilia has increased its car sales during the year, but the company’s market share in new car sales declined slightly, amounting to 8.3 per cent (8.5) in Sweden and 4.5 per cent (4.8) in Norway.

The sales organisation’s processes and procedures have been a focus area during 2015, which led to an improvement in efficiency. Car sales also affect the Service Business, since each car sold generates workshop hours and need sales. A long-term customer relationship is cemented by service subscriptions sold together with the car.

Dedicated facilities strengthen the business>> In the Car Business, Bilia offers new and used cars and transport vehicles of leading brands. Car sales are a hub in Bilia’s operations and generate added values in the form of accessory services and need sales.

14 Car Business

15

• Sales of new and used cars

Car Business• Financing and

insurance• Sales of

accessories

2013

2014

2015

Net turnover, SEK M 13,254 14,132 15,694

Share of turnover, % 72 74 74

Operating profi t, SEK M 67 185 286

Operating margin, % 0.5 1.3 1.8

Number of new cars delivered 35,627 37,744 41,102

Number of used cars delivered 33,606 33,566 37,542Number of employees 721 735 783

Financial overviewIncome statementSEK M

2013

2014

2015

Net turnover 17,656 18,446 20,443Cost of goods sold –14,883 –15,533 –17,076Gross profi t 2,773 2,913 3,367Operating profi t, excluding items aff ecting comparability 395 553 731Items aff ecting comparability –27 9 198Operating profi t 368 562 929Net fi nancial items –1 –7 4

Profi t before tax 367 555 933Profi t for the year from continuing operations 290 452 731Loss from discontinued operation, net after tax — –67 –84Net profi t for the year 290 385 697

Earnings per share, SEK 5.85 7.65 12.85Earnings per share from continuing operations, SEK 5.85 9.00 14.50Weighted average number of shares, ‘000 49,529 50,310 50,406

Key ratios

2013

2014

2015

Operating margin, % 2.1 3.0 4.5 Return on capital employed, % 17.7 19.8 36.2 Return on equity, % 17.0 21.0 33.2Operating cash fl ow, SEK M 83 748 212 Equity/assets ratio, % 29.9 26.6 27.7 Equity per share, SEK 36.25 36.70 40.75 Dividend per share, SEK 4.50 6.00 7.50 Number of employees, 31 December 3,401 3,521 3,613

Items affecting comparabilityItems aff ecting comparability for the year mainly pertain to redemption of PRI liability in the amount of SEK 197 M.

Proposed dividend

Net fi nancial itemsNet fi nancial items improved by SEK 11 M. The main reason was higher income from associated companies and redemption of pension liability.

Discontinued operationThe operation in Denmark was discontinued during the year, and the loss, net after tax, amounted to SEK 84 M (loss: 67).

16 Financial overview

Both the Car and Service Businesses reported better earnings

Bilia delivered 41,102 new and 37,542 used cars, which was 10 per cent more than in 2014. The Car Business reported an operating profit of SEK 286 M (185) and an operating margin of 1.8 per cent (1.3). The improvement is mainly attributable to sales of used cars, which reported a profit that was SEK 81 M better than in 2014. Higher turnover and a larger gross profit margin resulted in strong earnings from sales of used cars. Earnings from sales of new cars improved by SEK 25 M, due mainly to higher turnover and a higher gross profit margin.

Demand in the Service Business was strengthened during the year, and operating profit amounted to SEK 479 M (402) while the margin amounted to 10.7 per cent (10.1). Underlying turnover, adjusted for acquisitions and disposals, increased by about 6 per cent in the Service Business. The increase is explained by slightly improved demand, together with increased efforts to promote service subscriptions, tyre hotels and need sales. The Group’s operating profit, excluding items affecting comparability, amounted to SEK 731 M (553) and net profit for the year to SEK 647 M (385). Group overheads in relation to turnover amounted to 12.9 per cent (12.8).

Items affecting comparability pertain mainly to the earnings effect before tax, SEK 197 M, of the transfer of the Swedish pension liability to Alecta.

The operation in Denmark was discontinued during the year, and the loss, net after tax, amounted to SEK 84 M (loss: 67).

In response to the year’s good earnings, employee bonuses totalling SEK 25 M (21) were approved. The Board of Directors has also proposed an increased dividend to the shareholders.

Stocks of used cars increased at the end of the year, but are at a good level with the exception of Norway. The turnover rate for used cars increased, amounting to just under 11 times per year. Operating cash flow amounted to SEK 212 M (748). The decline is attributable to increased tied-up capital at year-end 2015.

Industry analysts predict that the car markets in Sweden and Norway in 2016 will be on a par with the situation in 2015.

>> Demand for cars and service was slightly better compared with last year, and the Group reported its best profit ever.

17 Group overview

The Swedish market for new cars grew during the year by 14 per cent to a record high of 345,108 units (303,948), which means that 2015 was the best car year in history. A clear trend during the year was the sharp increase in private leasing. Corporate sales remained strong, and about 55–60 per cent of all cars were registered to companies. Demand in the Service Business was at a good level in 2015. Campaigns directed at the important stock of older cars are continuing during 2016 as well.

Bilia delivered 29,546 new cars (26,827), 27,253 used cars (25,060), 3,000 new transport vehicles (2,636) and 1,319 used transport vehicles (1,146). The used cars stock and its age structure remained at a very good level, and the turnover rate in the stock reached a record level of 11.9 times.

Events during the yearA new MINI dealership was inaugurated in southern Stockholm in August.

Kaiser Bil AB, with sales and service of Lexus, was acquired in October. The company operates three facilities in Stockholm and one in Malmö.

A decision was made in October to discontinue sales of new Ford cars. We will, however, retain our service authorisation.

EarningsOperating profit was very strong and amounted to SEK 629 M (458), with a margin of 4.3 per cent (3.5). The Service Business’s operating profit improved by SEK 32 M, due mainly to higher turnover and a higher gross profit margin. The Car Business’s operating profit improved by all of SEK 132 M. The improvement is mainly attributable to higher turnover in sales of new cars plus increased turnover and a higher gross profit margin in sales of used cars.

Challenges and opportunitiesEfforts to tie the customers closer by means of products such as service subscriptions and tyre hotels continue. Some 50,000 customers had signed service subscriptions at year-end and more than 162,000 wheels were stored in Bilia’s tyre hotels.

During the year we have developed and implement-ed a new set of core leadership values and started a process for increasing the proportion of women in the company. We are convinced that these efforts will help us to become an even better employer with stable earnings, a higher proportion of satisfied customers and happy employees. Efforts to boost customer satisfaction will be a priority focus area during 2016.

>> In Sweden, Bilia has 77 dealerships in five regions: Stockholm, Gothenburg, Malmö, Mälardalen and Skaraborg. The Swedish operation represents nine car brands: Volvo, BMW, Ford, Renault, Toyota, Lexus, Dacia, Hyundai and MINI.

Record market in Sweden

Total market Bilia’s sales & market share Bilia’s share of each brand’s sales

2013% 2014 2015

2013 2014 2015

Number of new cars

0

80,000

160,000

240,000

320,000

400,000

0

10

20

30

40

ToyotaHyundaiFordDaciaMiniBMWVolvoRenaultLexus2013 2014 2015

Number of new cars %

0

8,000

16,000

24,000

32,000

0

3

6

9

Transport vehicles

Renault 50

Ford 42

Dacia 5

Toyota 3

Cars

Volvo 59

BMW 15

Renault 10

Ford 5

Toyota 4

Dacia 2

Hyundai 2

Mini 2

Lexus 1

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013% 2014 2015

2013 2014 2015

Number of new cars

0

80,000

160,000

240,000

320,000

400,000

0

10

20

30

40



0

8,000

16,000

24,000

32,000

0

3

6

9

Transport vehicles

Renault 50

Ford 42

Dacia 5

Toyota 3

Cars

Volvo 59

BMW 15

Renault 10

Ford 5

Toyota 4

Dacia 2

Hyundai 2

Mini 2

Lexus 1

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013% 2014 2015

2013 2014 2015

Number of new cars

0

80,000

160,000

240,000

320,000

400,000

0

10

20

30

40



0

8,000

16,000

24,000

32,000

0

3

6

9

Transport vehicles

Renault 50

Ford 42

Dacia 5

Toyota 3

Cars

Volvo 59

BMW 15

Renault 10

Ford 5

Toyota 4

Dacia 2

Hyundai 2

Mini 2

Lexus 1

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

18 Sweden

Bilia ABi Sverige

6

26

10

16

16

11

Bilia’s deliveries broken down by brand, %

2013% 2014 2015

2013 2014 2015

Number of new cars

0

80,000

160,000

240,000

320,000

400,000

0

10

20

30

40



0

8,000

16,000

24,000

32,000

0

3

6

9

Transport vehicles

Renault 50

Ford 42

Dacia 5

Toyota 3

Cars

Volvo 59

BMW 15

Renault 10

Ford 5

Toyota 4

Dacia 2

Hyundai 2

Mini 2

Lexus 1

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013

2014

2015



Operating profi t, SEK MService 283 319 351

Cars 38 121 253 Fuels 21 18 25

Total 342 458 629

Operating margin, %Service 10.3 11.0 11.2

Cars 0.5 1.2 2.3

Fuels 2.0 1.7 2.5

Total 3.0 3.5 4.3

Bilia in Sweden

71%Sweden’s share of turnover 2015

19

The most fun part of the job is meeting the customer, establishing a good relationship and having a good dialogue.Stefan Holmberg, Front End Salesman

Total market Bilia’s sales & market share Bilia’s share of each brand’s sales%

2013 2014 2015

Number of new cars

0

60,000

120,000

180,000

0

10

20

30

40

FordToyotaBMWLexusVolvo2013 2014 2015


0

3,000

6,000

9,000

0

2

4

6

Transport vehicles

Ford 73

Toyota 27

Cars

Volvo 42

BMW 33

Toyota 14

Ford 9

Lexus 2

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013 2014 2015%

2013 2014 2015

Number of new cars

0

60,000

120,000

180,000

0

10

20

30

40



0

3,000

6,000

9,000

0

2

4

6

Transport vehicles

Ford 73

Toyota 27

Cars

Volvo 42

BMW 33

Toyota 14

Ford 9

Lexus 2

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013 2014 2015%

2013 2014 2015

Number of new cars

0

60,000

120,000

180,000

0

10

20

30

40



0

3,000

6,000

9,000

0

2

4

6

Transport vehicles

Ford 73

Toyota 27

Cars

Volvo 42

BMW 33

Toyota 14

Ford 9

Lexus 2

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013 2014 2015

20 Norway

The marketThe car market in Norway was at a high level for the fifth year in a row with a total market of 150,686 new cars (144,202). This means that 2015 was the third best car year ever. Electric cars increased their share of the total market to 17.1 per cent (12.5). A fee modification during the year resulted in increased sales of plug-in hybrids, whose market share rose to 5.2 per cent and is expected to increase further during 2016.

BMW’s market share decreased to 6.3 per cent (6.7), which is still the second-highest market share in history. Volvo reported a reduced market share of 6.6 per cent (7.9), while Ford enjoyed a positive trend with a market share of 5.6 per cent (5.4). Bilia delivered 7,699 new cars (7,879), 8,617 used cars (7,360), 612 new transport vehicles (402) and 159 used transport vehicles (—). Bilia’s sales accounted for 5.1 per cent (5.5) of total car sales in Norway. The order backlog increased from 1,099 cars to 2,488 during 2015.

Events during the yearToyota Horten-Tønsberg AS and Toyota Hell Bil AS were taken over in March and subsequently merged to form Toyota Bilia AS. The Toyota operation’s 2015 sales amounted to 6.7 per cent of total Toyota sales in Norway,

while Lexus sales represented 15.1 per cent. All BMW facilities were upgraded to the latest standard during the year. The sales agreement with Ford was terminated in October. The period of notice for the affected facilities in Drammen, Hønefoss and Økern is two years.

EarningsThe operating profit of SEK 159 M (147) is the best ever. Operating profit in the Car Business amounted to SEK 38 M (64). New car sales reported a considerably lower profit compared with 2014, due mainly to lower turnover and higher relative costs. Used car sales developed positively, and earnings were the best ever. The Service Business showed a positive trend, with an operating profit of SEK 122 M (83).

Challenges and opportunitiesThere is great uncertainty regarding the future trend on the Norwegian car market due to low oil prices, a weak currency and slightly higher unemployment. There is also a political will to reduce driving in Oslo. Thanks to improved processing of used cars and the establishment of the Personal Service Technician concept, Bilia stands well-equipped to meet 2016.

Growing with Toyota and Lexus>> Bilia has 25 dealerships in Norway, eight of which are associated with the new Toyota and Lexus operations. The Norwegian operation offers five car brands: Volvo, BMW, Toyota, Ford and Lexus, and carries out authorised service on MINI.

Bilia ABi Norge

1

1

1

1

11

3

4

3

28%Norway’s share of turnover 2015


%

2013 2014 2015

Number of new cars

0

60,000

120,000

180,000

0

10

20

30

40



0

3,000

6,000

9,000

0

2

4

6

Transport vehicles

Ford 73

Toyota 27

Cars

Volvo 42

BMW 33

Toyota 14

Ford 9

Lexus 2

Cars

Transport vehicles

CarsNumber

Market share

Number

Market share

Transport vehicles

2013 2014 2015

2013

2014

2015



Operating profi t/loss, SEK MService 60 83 122

Cars 57 64 38 Fuels –1 — –1

Total 116 147 159

Operating margin, %Service 5.9 7.7 9.7

Cars 1.3 1.4 0.8

Fuels –7.9 — –3.9

Total 2.3 2.8 2.8

Bilia in Norway

21

>> In Germany, Bilia has four facilities north of Frankfurt that are dealerships for BMW and MINI. The German operation has been a part of Bilia since 1 October 2015.

Tough competition on a strong market

The marketThe total market for cars increased by 6 per cent to 3,206,042 cars. Bilia delivered 245 new cars and 194 used cars during the period 1 October to 31 December 2015.

EarningsOperating profit for the fourth quarter of 2015 amounted to SEK 1 M, which was charged with acquisition costs of SEK 1 M. The Service Business reported strong earnings, while new car sales reported weak earnings. Due to the design of the bonus system for new cars, the BMW dealers often report poorer earnings during the fourth quarter.

Challenges and opportunitiesThe operation is well-managed and has a good reputation among customers. There is a potential for improvement in the Service Business and in the handling of used cars. Furthermore, there are good opportunities for growth in the region by means of acquisition and subsequent efficiency-boosting measures.

Operation in Denmark discontinued>> Bilia’s Board of Directors decided in March 2015 that the operation in Denmark would be sold or shut down.

Most of the operation was disposed of at the end of the second quarter, and the rest during the month of August 2015. At year-end there remained land which is for sale

and which has a carrying amount of SEK 7 M. The loss from the discontinued operation, net after tax, amounted to SEK 84 M (loss: 67).

22 Germany / Denmark

Germany / Denmark

4

Bilia ABi Tyskland

1%Germany’s share of turnover 2015


%

2013 2014 2015

Antal nya bilar

0

60 000

120 000

180 000

0

10

20

30

40

FordBMWVolvo2013 2014 2015

Antal nya bilar %

0

2 000

4 000

6 000

8 000

0

2

4

6

xxxx

xxx, 100

Cars

BMW 86

MINI 14

Personbilar

Transportbilar

PersonbilarAntal

Marknadsandel

Antal

Marknadsandel

Transportbilar

2013 2014 2015

2015

Net turnover, SEK M 173

Share of turnover, % 1

Operating profi t/loss, SEK MService 6

Cars –5Fuels —

Total 1

Operating margin, %Service 5.3

Cars –6.5

Fuels —

Total 0.4

Bilia in Germany

23

Dividend policy Over a business cycle, Bilia’s dividend should provide the shareholders with a competitive dividend yield in comparison with similar listed companies. In addition, Bilia should strive for good dividend growth. According to a decision by the Board of Directors, the dividend should amount to at least 50 per cent of the net profit for the year. In determining the size of the dividend, the company’s sustained earning capacity, cash flow, investment needs and overall financial position are also taken into account.

Dividend Bilia’s Board of Directors proposes to the Annual General Meeting of 8 April 2016 that a dividend of SEK 7.50 per share (6.00 after adjustment for the stock split) be paid.

Stock splitAfter Bilia carried out a 2:1 stock split in May 2015, the number of shares increased from 25,204,805 to 50,409,610 with an equal number of votes. The purpose of the stock split is to stimulate trading in the share.

WarrantsDuring the year, 87,986 warrants were exercised to subscribe for new shares, resulting in a new issue of SEK 1 M. An additional 264,682 warrants were exercised at the beginning of January 2016. The remaining warrants expired on 5 January 2016.

Stock split to stimulate trading

0

100

200

300

400

11 12 13 14 15

%

year0

50

100

150

200

11 12 13 14 15

SEK

year

The highest price quoted during the year was SEK 210.00 on 3 December, and the lowest was SEK 112.25 on 16 January.

Price of Bilia shareTotal yield

>> The Bilia share has been listed on the NASDAQ Stockholm exchange since 1984. It is traded under the ticker code BILI A and is included in the OMX Stockholm Mid Cap PI index. At year-end 2015, Bilia had 35,183 shareholders (35,282).

Source: NASDAQ

A-share OMX Stockholm GI

Source: NASDAQ

A-share OMX Stockholm PI

24 Share, AGM and important dates

Annual General MeetingThe Annual General Meeting will be held at 11:00 a.m. on Friday, 8 April 2016, at Bilia’s facility at Haga Norra, Frösundaleden 4, Stockholm. Notice of the AGM will be published in Post- och Inrikes Tidningar (the offi cial Swedish gazette), on Bilia’s website and in a small notice in Dagens Industri. More information on the AGM can also be found under Corporate Governance at bilia.com.

Notifi cation of attendance can be made online at bilia.com or by telephone at +46 31 709 55 04 by 4 April 2016 at the latest.

Important datesAnnual General Meeting 2016 8 AprilReport for the fi rst three months of 2016 27 AprilReport for the fi rst six months of 2016 27 JulyReport for the fi rst nine months of 2016 28 October

Distribution of shares, 31 December 2015Shareholding

Total numberof shareholders

Combined numberof shares owned

Percentage ofshare capital

1–1,000 32,426 5,598,267 11.1

1,001–10,000 2,476 6,284,234 12.510,001–100,000 219 6,635,007 13.1100,001– 62 31,918,544 63.3Total number of shareholders 35,183 50,436,052 100.0

1. Investment AB Öresund 10.1 2. The Qviberg family 10.0 3. Anna Engebretsen with family 4.2 4. Handelsbanken funds AB RE JPMEL 3.6 5. JP Morgan Bank Luxembourg SA 2.7 6. SEB Investment management 2.5 7. SSB CL Omnibus AC 2.2 8. JPM Chase NA 1) 2.2 9. NTC various funds, Chicago 2) 1.8 10. CBNY-DFA-INT SML CAP V 1.6 11. Försäkringsaktiebolaget Avanza pension 1.5 12. Mellon Omnibus 30% Agent F ITS Clients 1.5 13. CBNY-Norges Bank 1.5 14. Mellon US Tax exempt Account 1.3 15. Jan Pettersson with family 1.0

Foreign owners, 39 (36)Swedish private > 500, 33 (29)Öresund, 10 (10)Swedish institutions, 8 (9)Swedish private < 500, 6 (10)Swedish unit trusts, 4 (6) 2015 2014

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

0

4

8

12

16

20

10 11 12 13 14

Turnover of Bilia share

1) JPM Chase NA has 9 funds with the same name and address. They have been aggregated in the table above.

2) NTC has 10 funds with the same name and address.They have been aggregated in the table above.

Bilia’s biggest shareholders at 31 December 2015, %

Turnover, daily average per month, number of sharesTurnover, daily average per month, SEK M Source: NASDAQ

Ownership by categories31 December 2015, %

25

Bilia AB (publ)You can reach us round the clock at Bilia Nu +46 771 400 000 You can also visit our website bilia.com

PR

OD

UC

TIO

N: N

EW

SR

OO

M

bilia company presentation 2015

Documents