1 JANUARY – 30 JUNE 2009 (COMPARED WITH SAME PERIOD A YEAR AGO)
• Net sales rose 2% during the period, to SEK 3,320 million (3,258). For comparable units net sales fell 11%.
• Operating profit before amortisation of intangible assets (EBITA) decreased by 26% to SEK 303 million (407), and the EBITA margin was 9.1% (12.5).
• Profit after tax decreased by 34% to SEK 171 million (259).
• Earnings per share were SEK 4.28 (6.48).
• The return on operating capital for the last 12 months was 27.9% (38.8).
SECOND QUARTER 2009 (COMPARED WITH SAME PERIOD A YEAR AGO)
• Net sales fell 8% during the second quarter to SEK 1,589 million (1,733). For comparable units the decrease was 19%.
• Operating profit before amortisation of intangible assets (EBITA) decreased by 39% to SEK 142 million (232) and the EBITA margin was 8.9% (13.4).
• Profit after tax decreased by 49% to SEK 76 million (150).
• Earnings per share were SEK 1.90 (3,75) for the second quarter.
The trend from the first quarter has continued, with falling order intake in many market segments. Within the quarter, however, the decrease in June was considerably smaller than during the quarter as a whole. I see this as a sign of a stabilisation and that customers who have had inventory, have used it and are beginning to order again.
The sectors within the Group that have not been affected by the decline are energy, products for the municipal water and wastewater sector, and the medical sector. Valves, measuring instruments, and filters and pumps for the process industry have been affected to a slight degree. Of the major geographic markets, the decline has been the greatest in Finland.
All companies that have experienced a drop in volume have some type of cost-cutting programme in place that is adapted to their operations and the country they work in. In Finland, for example, furloughs are being used to a great extent, while Swedish companies are cutting working hours and laying off employees. The cost-cutting programmes that have been initiated within the Group are estimated to reduce the Group's overhead by approximately SEK 200 million and the number of employees by 300 on a full year basis.
The gross margin, which is a key indicator of the price trend, improved compared with the first quarter of 2009, from 32.4% to 33.1%. This can be credited to, among other things, currency-related price adjustments, which had an impact during the quarter.
Our earnings fell during the second quarter as a result of lower volumes for most of the Group's companies. Despite the tough economic climate, the EBITA margin was 8.9% for the second quarter and was thus higher than our long-term target of at least 8% over an economic cycle. Our target return on operating capital is a minimum of 25% over an economic cycle, and the outcome on 30 June was 27.9% on a moving 12-month basis.
We did not make any acquisitions during the period, however, there is a greater likelihood for acquisitions during the second half of the year.
In the prevailing market climate, to date Indutrade has met its long-term goals, which must be considered to be acceptable.
Johnny Alvarsson, President and CEO