Interim report January-September 2010

Interim report January-September 2010

1 July - 30 September

  · Revenues increased 8 per cent adjusted for currency effects and
calculated on comparable workdays. Prior to adjustment, revenues
increased 4 per cent to SEK 839 M (808).
  · EBIT increased 41 per cent to SEK 141 M (100) and the EBIT margin
rose to 17 per cent (12).
  · Profit after financial items increased 44 per cent to SEK 140 M
(97).
  · Profit after tax amounted to SEK 100 M (70).
  · Earnings per share before and after dilution amounted to SEK 3.07
(2.16).

1 July - 30 September

  · Revenues increased 9 per cent adjusted for currency effects and
calculated on comparable workdays. Prior to adjustment, revenues
increased 7 per cent to SEK 2,555 M (2,391).
  · EBIT increased 54 per cent to SEK 375 M (244) and the EBIT margin
rose to 15 per cent (10).
  · Profit after financial items increased 56 per cent to SEK 374 M
(240).
  · Profit after tax amounted to SEK 273 M (175).
  · Earnings per share before and after dilution amounted to SEK 8.43
(5.33).
  · Net indebtedness totalled SEK 87 M (29) at the end of the period. 

 

SUMMARY OF THE GROUP'S EARNINGS TREND  July - September      January -
September         12 months  Full-year
2010                                   2009  Change %  2010  2009  
Change %  Oct - Sep  2009
Revenues, SEK M                        839   808       4     2,555 
2,391     7          3,370      3,206
EBIT, SEK M                            141   100       41    375    244 
     54         456        325
Profit after financial items, SEK M    140   97        44    374    240 
     56         456        323
Profit after tax, SEK M                100   70        43    273    175 
     56         336        237
Earnings per share, SEK                3.07  2.16      42    8.43   5.33
     58         10.49      7.38
EBIT Margin, %                         17    12              15     10  
                14         10

CEO's comments 

Strong third quarter for Mekonomen

  · EBIT for the third quarter rose 41 per cent
  · EBIT margins in Norway and Sweden remained high
  · Denmark displayed stable EBIT margin at 6 per cent

Mekonomen's EBIT for the third quarter of 2010 increased 41 per cent to
SEK 141 M (100) and the EBIT margin amounted to 17 per cent (12).
Without adjustments, revenues increased 4 per cent to SEK 839 M (808).
As in the second quarter of 2010, the strong EBIT margin was partly due
to improved gross margin through more efficient purchasing and partly
due to cost control throughout the operations.

EBIT for the third quarter in Denmark rose to 12 per cent (3) and the
EBIT margin amounted to 6 per cent (2). The turnaround in Denmark is
evident and the operation is now on a stable profitability level. 

In Norway, sales increased 8 per cent. The EBIT margin amounted to 20
per cent (18). Both growth and profitability were attributable to
continued efforts in the Mekonomen concept. During the quarter, a number
of new partnerships were initiated, including the workshop chain Fyksen
Servicecenter, with five facilities in Norway. 

In Sweden, the EBIT margin amounted to 21 per cent (18). Growth was 6
per cent. 

The sale of Mekonomen's own branded products remain successful and
during the third quarter additional spare parts under the brand name
Mekonomen Original was launched. 

The number of workshops affiliated to Mekonomen increased and totalled
1,275 (1,197) at the end of the period. The number of stores during the
same period amounted to 224 (215). Sales to Mekonomen Service Centres
increased 15 per cent during the third quarter signifying that the
Mekonomen Service Centre chain has the strongest growth among workshop
chains in Scandinavia. It is also very gratifying that the MekoPartner
chain increased 19 per cent during the third quarter. The demand for our
workshop services is high and the challenge lies in increasing growth in
existing workshops, with more mechanics, as well as more workshops. It
is also clear that Mekonomen Workshop Centres are an important factor to
the increased growth in the workshop segment. 

Based on the current market situation, with clear plans for further
development, Mekonomen is well equipped for the future. According to a
recent survey conducted by NORM, knowledge of Mekonomen among car owners
in Sweden is a full 99 per cent. In Norway, knowledge increased from 87
to 91 per cent and in Denmark from 54 to 66 per cent. Particularly
satisfying is that Mekonomen's workshops received high ratings from
customers. 

The market trend in Sweden and Norway displayed strong growth of
approximately 5 per cent, year-on-year (currency adjusted), while the
Danish market is about 0 per cent. 

The strong earnings during the third quarter confirmed that our
repositioning has generated higher revenues and improved EBIT margins.
The launch of the Mekonomen concept continues with full power, to make
CarLife easier for customers.
 

Håkan Lundstedt
President and CEO

For further information, please contact:
Håkan Lundstedt, President and CEO Mekonomen AB, Tel: +46 (0)8-464 00 00
Gunilla Spongh, CFO Mekonomen AB, Tel: +46 (0)8-464 00 00

Mekonomen makes CarLife easier through a wide and easily accessible
range of inexpensive and innovative solutions and products for consumers
and companies. We are Scandinavia's leading spare-parts chain with
proprietary wholesale operations, more than 200 stores and more than
1,000 workshops operating under the Mekonomen brand.