Interim Report 9 months - 1 April-31 December 2016

Third quarter (1 October-31 December 2016)

• Revenue rose by 7 percent to MSEK 2,132 (1,993).
• Operating profit amounted to MSEK 94 (115), corresponding to an operating margin of 4.4 percent (5.8).
• Adjusted operating profit (excluding items affecting comparability) totalled MSEK 113 (115), corresponding to an adjusted operating margin of 5.3 percent (5.8).
• Net profit amounted to MSEK 70 (85).
• Earnings per share totalled SEK 2.50 (3.05).
• Cash flow from operating activities amounted to MSEK 191 (207) and cash flow per share for the most recent 12-month period totalled SEK 17.35 (16.05).
• Two strategic acquisitions carried out during the quarter strengthened the Group’s position as a supplier to the industrial and construction sectors in the Nordic region.
• Preparations are under way for the separate listing of the Momentum Group operating segment on Nasdaq Stockholm in 2017.

Reporting period – 9 months (1 April-31 December 2016)

• Revenue rose by 4 percent to MSEK 6,146 (5,886).
• Operating profit amounted to MSEK 358 (375) and the operating margin was 5.8 percent (6.4).
• Adjusted operating profit (excluding items affecting comparability) increased by 5 percent to MSEK 378 (360), corresponding to an adjusted operating margin of 6.2 percent (6.1).
• Net profit amounted to MSEK 265 (275).
• The return on working capital for the most recent 12-month period was 25 percent and the return on equity was 13 percent (14).
• The equity/assets ratio at the end of the period was 50 percent (52).
• The operational net loan liability declined to MSEK 175 (266).

PRESIDENT’S STATEMENT

Investing in the future with a focus on increased growth and profitability The Group’s revenue rose by 4 percent during the first nine months of the 2016/17 financial year. At the same time, operating profit increased by 5 percent (adjusted for items affecting comparability). During the financial year, we conducted a number of strategic acquisitions that have strengthened our operating segments for the future.

Within Bergman & Beving, the share of proprietary product brands is increasing, which is improving our margin and earnings trends, and we are also continuously investing in product development and brand building. Within Momentum Group, there is variation between the various businesses when it comes to profitability. The operating margin for Momentum Industrial remains strong, while TOOLS Sweden has implemented and will continue to implement robust measures in order to improve its profitability – including an adapted store network, the establishment of its own central warehouse and a realignment of its purchasing. The costs for these measures are being charged to the business’ profit on an ongoing basis.

Preparations for a separate listing of Momentum Group In late October 2016, the Board of Directors of B&B TOOLS decided to commence preparations for a separate listing of Momentum Group on Nasdaq Stockholm. The aim is to implement the listing during 2017. Over the course of the financial year, this work has involved a large number of activities and measures to enable a split of the Group, which will require all joint functions, particularly for logistics and IT, to be divided up between two separate and independent companies. So far, these measures have proceeded according to plan and resulted in costs affecting comparability of approximately MSEK 20 during the reporting period.

With a sense of great confidence, I look forward to the planned split of the Group into two independent, listed companies and I am convinced that the investments we are making will generate a positive return in the future. With a healthy cash flow and strong balance sheet, we have the right conditions for the long-term profitable growth of Bergman & Beving and Momentum Group through both organic growth and through acquisitions. 

Stockholm, February 2017 

Ulf Lilius President & CEO

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