Proffice Interim report January-June 2015

PRESS
RELEASE
                     Stockholm 2015-08-18

Continued investments for profitable growth

Q2 2015

  · Revenue amounted to SEK 1,045 million (1,078). Adjusted for the sale of
Aviation, revenue for the continuing operation increased by 5 per cent.
  · EBITA increased by 24 per cent to SEK 31 million (25). Other operating
income affected EBITA by SEK 10 million, attributable to the disposal of
Aviation.
  · The EBITA margin totalled 3.0 per cent (2.3).
  · Cash flow from operating activities totalled SEK ‑35 million (24).
  · Basic earnings per share totalled SEK 0.38 (0.25).

YTD 2015

  · Revenue amounted to SEK 2,054 million (2,074). Adjusted for the sale of
Aviation, revenue for the continuing operation increased by 4 per cent.
  · EBITA increased by 18 per cent to SEK 53 million (45). Other operating
income affected EBITA by SEK 10 million, attributable to the disposal of
Aviation.
  · The EBITA margin totalled 2.6 per cent (2.2).
  · Write-down of goodwill totalled SEK 36 million.
  · Cash flow from operating activities totalled SEK ‑1 million (23).
  · Basic earnings per share totalled SEK 0.07 (0.44).


Key events

Q2

New financial targets and revised strategy. The Board adopted new long-term
financial targets related to profitability, growth, and capital structure. The
Group’s strategy was also revised in conjunction with this.

AGM resolved to approve the Board’s dividend proposal. A dividend of SEK 0.90
per share (0.60) totalling SEK 61 million was approved.

Proffice Group sells Aviation area of competence. Aviation was sold to OSM
Aviation AS. The sale affects all four Nordic countries as of 17 April 2015.

Acquisition of treasury shares. The Board agreed to acquire a maximum of
4,500,000 B shares up until the 2016 Annual General Meeting (AGM).

After end of quarter

Proffice Care in Norway concluded agreement with HINAS. Proffice Care AS will
supply nurses to Norwegian hospitals. The client is HINAS, the purchasing
organisation of Norwegian health companies. The agreement applies from 1 October
2015 and will run for two years with the possibility of a one plus one year
extension.

Financial overview

              Q2                      YTD                     R12    Full
                                                              2)     year
Group 1)      2015   2014   Change    2015   2014   Change           2014
Revenue, SEK  1,045  1,078  -3%       2,054  2,074  -1%       4,183  4,203
million
Other         10     1      -         11     1      -         14     4
operating
income,
SEK million
EBITA, SEK    31     25     24%       53     45     18%       148    140
million
EBITA         3.0    2.3    -         2.6    2.2    -         3.5    3.3
margin, %
Operating     31     25     24%       17     45     -62%      112    140
profit, SEK
million
Operating     3.0    2.3    -         0.8    2.2    -         2.7    3.3
margin, %
Profit after  26     17     53%       5      30     -83%      79     104
tax, SEK
million
Basic         0.38   0.25   52%       0.07   0.44   -84%      1.14   1.51
earnings per
share,
SEK
Diluted       0.38   0.25   52%       0.07   0.44   -84%      1.14   1.51
earnings per
share, SEK
Cash flow     -35    24     -         -1     23     -         124    148
from
operating
activities,
SEK million
Cash flow     -0.51  0.35   -         -0.01  0.34   -         1.82   2.17
from
operating
activities
per share,
SEK
Basic equity  8.20   8.38   -2%       8.20   8.38   -2%       -      9.36
per share,
SEK
Return on     14.0   18.2   -         14.0   18.2   -         -      17.2
equity, %

1) As of 17 April 2015 all financial information excludes the Aviation area of
competence
2) Refers to the last 12 months

Comments by Henrik Höjsgaard, CEO

Continued investments for profitable growth
Proffice continued to invest in its employees and systems support in Q2. The
Group invested SEK 11 million in IT systems and the investments will continue
throughout the year as planned. This means that Proffice will be able to utilise
the Group’s collective resources more efficiently. Together with the new sales
organisation, these initiatives will pave the way for a more efficient sales
process.

The Aviation area of competence was sold in Q2. Revenue for continuing
operations increased by five per cent, indicating good demand for the Group’s
services.

Strong Swedish operation
The Swedish market remained favourable, as demonstrated by the revenue increase
in the Industry & Logistics area of competence. All operating areas grew, and
adjusted for the sale of Aviation, revenue increased by seven per cent in the
Swedish operation during the quarter. Profitability is in focus and the
performance of the Swedish operation continued to be positive, resulting in a
better margin.

Weaker market in Other Nordic Countries
Norway’s macroeconomic situation has hit the staffing industry hard, leading to
declines in staffing and recruitment, while outplacement activities increased.
In order to better meet these challenges and strengthen our position in the
Norwegian market, a new director was appointed in Q1. A new management team was
appointed in Q2 just as the establishment of a new sales organisation was begun.

Happily, we were able to announce after the end of the quarter that Proffice
Care was one of those chosen to sign agreements with the purchasing organisation
of the Norwegian health companies (HINA) to supply nurses to Norwegian
hospitals. Great emphasis was placed on quality, and our internal team together
with our nurses and specialist nurses received high quality scores.

New financial targets for a more stable and consistently profitable Proffice
The Board took decisions on new long-term financial targets during the quarter.
Strategies were revised in order to attain the new financial targets, where the
main strategy is product leadership through skills specialisation. That this is
the right path forward was particularly demonstrated by the Life Science area of
competence, which grew by 37 percent during the quarter. It is important for
customers and candidates to meet specialists who understand their challenges and
circumstances.

The EBITA margin totalled 3 per cent during the quarter and the Group had good
underlying growth. The strengthened sales organisation and investments in
systems support have laid the foundation for Proffice to grow at least in pace
with the market. The Board initiated a share buyback program, and treasury
shares were bought back during the quarter in order to adjust the company’s
capital structure to line up with its financial targets.

Continued investments ensure efficiency
By investing in a more efficient basic platform and a strong sales organisation,
we are now creating the conditions for achieving our long-term financial targets
and becoming the most successful staffing and recruitment company in the Nordic
region.

Henrik Höjsgaard
President and CEO

If you have questions about this full year report, please contact:
Henrik Höjsgaard, President and CEO, telephone +46 8 787 17 00,
henrik.hojsgaard@proffice.com
Benno Eliasson, CFO, telephone +46 8 787 17 00, benno.eliasson@proffice.com

This is a translation from Swedish. In the event of any discrepancies between
the Swedish and the translation, the former shall have precedence.

Proffice Group is one of the Nordic region's largest specialists within
staffing, recruitment and outplacement. Our commitment and service help people
and companies to find solutions to develop. The Proffice Group consists of
Proffice, Dfind and Antenn and it has around 10,000 employees. The Proffice
share is listed on Nasdaq Stockholm, Mid Cap. www.proffice.com

Information in this interim report is such that Proffice AB (publ) is obligated
to disclose it pursuant to the Swedish Securities Markets Act. The information
was released for publication on 18 August 2015 at 8 am CET.