May 8, 2019
Lindab International AB (publ): Lindab's Interim Report for the First Quarter 2019
First quarter 2019
Net sales increased by 8 percent to SEK 2,315 m (2,153), of which organic growth was 5 percent.
Adjusted1) operating profit increased by 85 percent to SEK 1922) m (104). Adjusted1) operating margin increased to 8.3 percent (4.8).
Operating profit amounted to SEK 1922) m (71).
Profit for the period increased to SEK 142 m (46).
Earnings per share, before and after dilution, increased to SEK 1.85 (0.60).
Cash flow from operating activities amounted to SEK 792) m (42).
On January 1, 2019, Lindab implemented a new organisational structure, which resulted in the former business area Products & Solutions being divided into Ventilation Systems and Profile Systems. As a result, as of the first quarter of 2019, the Group reports an external segment structure consisting of three segments; Ventilation Systems, Profile Systems and Building Systems.
1) Adjusted operating profit/operating margin does not include significant one-off items and restructuring costs.
2) Excluding the effect of implemented accounting standard, IFRS 16 Leases, operating profit amounted to SEK 185 m and cash flow from operating activities amounted to SEK 26 m.
Lindab's President and CEO, Ola Ringdahl, commented:
"Organic sales growth for the Group amounted to 5 percent during the quarter and adjusted operating profit increased to SEK 192 m (104). The increase in operating profit comes from all three business areas, with several positive contributing factors. The gross margin has continued to strengthen during the first quarter, while costs have decreased as a result of the efficiency programme. Profit for the period increased to SEK 142 m (46), which is the highest result ever for a first quarter.
As of the first quarter of 2019, the former business area Products & Solutions has been divided into two business areas, Ventilation Systems and Profile Systems, in the external reporting. Building Systems is not affected and continues to be reported as one of three business areas.
Ventilation Systems sales increased by 5 percent organically, with positive growth from most markets and product groups. The improved adjusted operating profit of SEK 149 m (107) was mainly as a result of increased sales but also due to reduced costs and improved gross margin. At the beginning of April, Lindab acquired a company in the UK to strengthen its offering within the air duct system business in the UK market.
Profile Systems benefited from mild weather conditions for the products that are installed outdoors, while sales of industrial construction projects decreased compared to the first quarter of 2018. Organic growth amounted to 2 percent with strong growth in the CEE/CIS region. Adjusted operating profit increased to SEK 43 m (11), which is mainly explained by improved gross margin as well as reduced costs.
Building Systems continued to have good organic growth of
5 percent in the quarter. Adjusted operating profit improved to SEK 9 m (0). During the first quarter it was mainly Western Europe and CEE that showed strong growth. Order intake was stronger than the corresponding quarter last year with growth in all European regions. Building Systems' turnaround programme continues according to plan with the objective to achieve sustainable profitability.
It is inspiring for the staff of Lindab to see that all the effort gone into the improvement programme has started to show results. It creates room to invest in the future. Investment in production will be increased to achieve improved efficiency and capacity. The focus on product development continues with an emphasis on profitable product categories and customer segments.
The priority for 2019 is to continue to focus on sustainable profitability. It should be noted that the economic conditions are highly favourable in Lindab's main markets, and as such there is a strong windfall at present. The Group must, however, also be well equipped to meet a potential future economic downturn.
Lindab turned 60 years old on February 6, 2019. Our founder Lage Lindh, who passed away last autumn, coined Lindab's three core values: Customer Success, Down-to-Earth, Neatness & Order. We continue to embrace these core values to build an even stronger Lindab."
This information is information that Lindab International AB (publ) is obliged to make public pursuant to to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out below, at 07:40 am (CEST) on 8 May 2019.
Ola Ringdahl, President and CEO
Mobile: +46 (0) 431 850 00
Malin Samuelsson, CFO
Mobile: +46 (0) 701 45 46 85
Lindab in brief:
Lindab develops, manufactures, markets and distributes products and system solutions for simplified construction and improved indoor climate. The products are characterised by their high quality, ease of assembly, energy efficiency, consideration towards the environment, and are delivered with high levels of service. Altogether, this increases customer value.
The Group had sales of SEK 9,326 m in 2018 and is established in 32 countries with approximately 5,100 employees. The main market is non-residential construction, which accounts for 80 percent of sales, while residential accounts for 20 percent of sales. During 2018, the Nordic market accounted for 45 percent, Western Europe for 33 percent, CEE/CIS (Central and Eastern Europe) for 20 percent and Other markets for 2 percent of total sales.
The share is listed on the Nasdaq Stockholm List, Mid Cap, under the ticker symbol LIAB.