KUNGSBACKA, Sweden, April 24, 2002 (PRIMEZONE) -- Elanders AB (publ.):
* Net turnover fell by 12 % to MSEK 549,9 (MSEK 623,3) * Pre-tax profits amounted to MSEK -16,5 (MSEK 1,3) * Positive cash flow of MSEK 3 (-MSEK 55) * Infologistics continues to gain new market shares * Continued negative price development in Infoprint
Elanders, the leading Nordic infomedia group, is organised into two business areas:
Infologistics
-- One-stop shop solutions that meet customer requirements for
producing, printing and distributing information - the Master
Vendor Concept.
-- Development of Publishing Management solutions for customers that
publish large amounts of data for business-to-business.
-- Database publishing and Cross Media Publishing of trade
information in a variety of media such as print, CD-ROM, the Web
and e-commerce.
-- Information structuring and system solutions for integrated
publishing.
-- Business development, support and outsourcing services.
-- Offset and digital printing (print-on-demand).
-- Product catalogues and manuals for industrial and commercial
companies in any media.
-- Educational material for schools and universities in Sweden and
Great Britain, as well as public printing for The Swedish
Parliament, the government, governmental departments etc.
-- Production and sales in Angered, Falkoping, Gothenburg,
Helsingborg, Landskrona, Malmo, Stockholm, Surte, Trelleborg and
Ostervala (Sweden), Espoo (Finland), Oslo (Norway). Newcastle (UK)
and Zalalovo (Hungary).
Infoprint
-- Products with a large number of pages that are printed offset and
digitally, in varying editions.
-- Exports to some 20 European countries.
-- Customised solutions for advertisements and magazines in colour.
-- Production and sales in Kungsbacka (Sweden), Oslo (Norway),
Harrogate (UK) and Plonsk (Poland).
Business area sales and profits
First quarter Net turnover Profit
MSEK 2002 2001 2002 2001
Business area
Infologistics 411 432 8,4 6,3
Infoprint 139 191 -16,5 6,2
Total 550 623 -8,1 12,5
Financial -8,4 -11,2
items
Group 550 623 -16,5 1,3
Conditions for the Group's operations
The differences between the conditions for the Group's two business areas are becoming all the more pronounced. The prospects for Infologistics, where our main strategy is to offer full service publishing solutions to major industrial customers in vehicles, pharmaceuticals, the telecom sector, electromechanics etc., are positive. There are many opportunities to create added value and the cost of the actual printing production is not of overriding importance.
The emphasis is on helping our customers in a professional manner with activities that are not part of their core business. Structuring information with flexible databases and image banks is usually the cornerstone of strategical business that can lead to total outsourcing. Elanders is a Nordic region leader, and one of the larger companies in Europe in this field, and we have a unique customer base for the future.
Infoprint, on the other hand, normally offers its services to customers that are primarily interested in purchasing the printed matter, such as publishers and directory companies. It is therefore considerably more difficult to provide added value and the focus is totally on the printing price per piece. Although Elanders is one of the leading Nordic actors, particularly regarding directory production, we are small in a European context. Satisfactory profitability can only be reached through highly efficient production in large volumes. Elanders operates in the European market, which is characterised by overcapacity and in need of restructuring.
Infologistics
Despite a persistent weak business cycle in several of the markets where Infologistics is active, development has been stable in the majority of the business area's operations. Interest in comprehensive solutions within the framework of our Master Vendor concept steadily increases and there is no doubt that Elanders continues to increase its market shares in the segment of major industrial customers. We have won several orders from strategically important customers during the period, for example Husqvarna.
The work on concentrating IT operations is proceeding and has lead to new measures during the period that, among other things, resulted in significant personnel reductions. These operations are not expected to be fully integrated into the rest of the business area's activities until the end of the current year, which is also when we expect to see positive results.
Infoprint
Competition in the directory and magazines markets continues to be intense. As a result of the existing overcapacity among European producers often new sales price levels only cover variable costs. Several of our competitors in the industry suffer from unsatisfactory profitability and structural measures are necessity for survival in the long run.
The coordination program for Infoprint, which has entailed rationalisations and the concentration of operations to the Group's plant in Kungsbacka as well as significant investments in new equipment, was concluded according to plan in 2001. The decrease in turnover stems primarily from the decision made by a couple of large customers to, starting this year, arrange for paper themselves and from lower price levels. The latter are also the reason behind the drop in results.
Turnover and profit
Group net turnover fell by MSEK 73,4 to MSEK 549,9 (MSEK 623,3) while operating profit decreased by MSEK 20,6 to MSEK -8,1 (MSEK 12,5). It is primarily the stiff price press in Infoprint and the cost of adjusting IT operations in Infologistics that has led to lower profits.
Investments and depreciation
During the period net capital expenditures totalled MSEK 20 (MSEK 63). Depreciation amounted to MSEK 54,0 (MSEK 50,1), of which goodwill depreciation was MSEK 9,8 (MSEK 10,1).
Financial position, cash flow and equity ratio
The Group's net debt amounted to MSEK 801 (MSEK 719) while cash flow during first quarter improved by MSEK 58 Mkr and amounted to MSEK 3 ( MSEK -55 ). The change in net debt is mainly due to the high level of investments in directory operations.
Shareholders' equity at the end of the year amounted to MSEK 807 (MSEK 878), which resulted in an equity ratio of 38,2 % (38,6 %).
Personnel The average number of employees during the period was 1851 (1955), of which 1366 are in Sweden (1469). At the end of the period the Group had 1848 employees (1937).
Future Prospects
Prospects for the current year are in part affected by the business cycle, which still shows no clear trend.
Developments thus far this year show that Elanders' position on the market for major industrial customers has been reinforced. This means that new sales and increased market shares in Infologistics can, to some degree, compensate for the structural problems in Infoprint. The uncertainty regarding the development in the economy and other market conditions makes the full-year result difficult to estimate. However, the Group predicts a positive cash-flow.
The most recent full-year forecast (Report on the annual accounts, 31 January 2002) read: "We believe that the ongoing action plan will contribute to positive developments in Group profits and cash flow during the year".
Coming reports from Elanders
The next report from Elanders (report on first half year and second quarter) will be released on 21 July 2002. The report on the third quarter (nine months) will be released on 21 October 2002 and the report on the annual accounts for 2002 will be released on 30 January 2003.
The company auditors have not reviewed this report.
The same accounting principles as used in the annual accounts for 2001 have been used in this report.
Further information can be found on Elanders' website www.elanders.se or via e-mail info@elanders.se.
This document is essentially a translation of the Swedish language version. In the event of any discrepancies between this translation and the original Swedish document, the latter shall be deemed correct.
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http://www.waymaker.net/bitonline/2002/04/24/20020424BIT01130/wkr0001.doc The full report http://www.waymaker.net/bitonline/2002/04/24/20020424BIT01130/wkr0002.pdf The full report