G & L Beijer Q4 2011

G & L Beijer Q4 2011

•    Net sales increased by 16 per cent to SEK 5,846.4M (5,044.3).

•    Operating profit rose by 26 per cent to SEK 432.5M (344.0).

•    Profit for the year increased by 45 per cent to SEK 374.1M (258.7)
including a capital gain of SEK 51.7M from the divestment of shares in Beijer
Alma.

•    Profit per share amounted to SEK 16.98 (18,85). Excluding the capital gain,
profit per share amounted to SEK 15.19 (12.25).

•    The Board of Directors proposes a dividend of SEK 9.00 (8.00).

•    Share split 2:1.

 
The above relates to the remaining operation

G & L Beijer is a technology-oriented trading Group which, through a combination
of added-value agency products and products of the company’s own development,
offers competitive solutions within refrigeration and air conditioning.

Sales
G & L Beijer ended the year robustly with strong growth and a significant
increase in profit. It meant that the Group reported its highest sales so far
and a new record profit from the current operation. Sales for the 2011 full year
increased by 16 per cent to SEK 5,846.4M (5,044.3). Organically, sales increased
by approximately seven per cent. At the end of the first quarter of 2010, the
Beijer Tech business area was divested, which means that Beijer Tech’s sales and
results are not included in the comparative figures for 2010. The subsidiary,
AIA, was divested at the end of 2011 and is not included in sales and profit for
2011 as these items relate only to the remaining operation.

Consolidated sales for the fourth quarter increased by 38 per cent to SEK
1,630.1M (1,178.1). The large acquisitions of Toshiba’s operation within
refrigeration and air conditioning, and United Refrigeration’s refrigeration
wholesale operation in France and the United Kingdom, accounted for the majority
of the sales increase. Other acquisitions during the year also affected sales
positively. Organic growth for the fourth quarter amounted to approximately five
per cent.

During the year, the organic volume increase comprised all markets in which G &
L Beijer operates. Sales in the Nordic market developed as they did for the
Group as a whole. Southern Europe, including France, Italy and Spain, reported
slightly stronger growth whilst the development in the United Kingdom and
Central Europe was somewhat weaker. Eastern Europe reported very strong growth,
albeit from lower levels. In South Africa, the development was also positive
with strong growth. The acquisitions of Carrier’s refrigeration wholesale
operation in Thailand and the Italian company, SCM Frigo, continued to develop
very positively.

Results
Consolidated operating profit for the full year rose by 26 per cent to SEK
432.5M (344.0). The result improvement is explained by increased sales volumes,
acquisitions and continued strict cost control. Operating profit for the fourth
quarter increased by 50 per cent to SEK 120.2M (80.1). The increase is due to
increased volume and synergy effects from acquisitions.

The Group’s financial income/expense for the full year amounted to SEK 55.4M
(1.0) and to SEK -0.1M (-0.5) for the fourth quarter. Financial income/expense
includes the capital gain of SEK 51.7M (0) from the divestment of shares in
Beijer Alma and a share in profits of associated companies of SEK 12.7M (8.0)
for the full year. The fourth quarter included a share in profits of SEK 1.5M
(2.0).

Profit before taxes increased to SEK 487.9M (345.0) for the full year. Profit
for the fourth quarter increased to SEK 120.1M (79.6). Profit after tax amounted
to SEK 374.1M (258.7) for the full year and to SEK 104.5M (61.1) for the fourth
quarter. Profit per share amounted to SEK 16.98 (18.85) for the full year.
Excluding the capital gain, profit per share amounted to SEK 15.19 (12.25).

Dividend
The Board of Directors proposes that the Annual Meeting of shareholders resolves
that a dividend of SEK 9.00 (8.00) per share shall be paid for the 2011
financial year. This is equivalent to a total of SEK 190.8M if the shares
currently held by the company are excluded.

Split
The Board of Directors proposes that the 2012 Annual Meeting of Shareholders
resolves upon a share split 2:1 aimed at improving the liquidity in the share.

Other financial information
Consolidated capital expenditure including acquisitions amounted to SEK 991.6M
(36.3) for the 2011 full year. Liquid funds, including unutilised bank overdraft
facilities, were SEK 677.2M (478.4) at the year end. Shareholders’ equity
amounted to SEK 2,433.4M (2,358.7). Net indebtedness amounted to SEK 1,141.1M
(395.4). The equity ratio was 47.8 per cent (59.4). The average number of
employees during the year was 1,945 (1,657).

Significant events
At the end of 2010, G & L Beijer acquired the assets in Carrier Corporation’s
refrigeration wholesale operation in Thailand. During the first quarter of 2011,
G & L Beijer acquired the Italian SCM Frigo group. SCM Frigo designs, develops
and builds chillers. Initially, G & L Beijer acquired 51 per cent of the shares
in SCM Frigo with an option to acquire the remaining 49 per cent. Both companies
are included in G & L Beijer’s accounts from 1 January 2011.

During the first quarter, G & L Beijer divested its entire holding of 2.7
million shares in Beijer Alma, equivalent to 9.0 per cent of capital and 4.5 per
cent of votes. The divestment generated sales proceeds of approximately SEK 365M
and G & L Beijer made a capital gain of SEK 51.7M.

In September, G & L Beijer completed its acquisition of Toshiba’s distribution
operation within refrigeration, heating and air conditioning in eleven European
countries from Carrier Corporation. As a result, G & L Beijer strengthens its
positions in the European market. The transaction meant that Carrier transferred
staff and net assets to G & L Beijer. The operation has around 160 employees.
The acquired operation is included in G & L Beijer’s accounts from 1 October
2011. The total consideration amounted to SEK 620M. The acquired net assets,
which mainly consist of stock items and operating liabilities, amounted to SEK
200M and the surplus value was SEK 420M. The majority of the surplus value is
deemed to be tax-deductible and is being further investigated. During 2011, the
acquisition affected consolidated net sales by approximately SEK 242M. The
acquisition would have affected consolidated net sales by approximately SEK
1,170M had it been included in the Group for the full year.

During the fourth quarter, G & L Beijer completed its acquisition of United
Refrigeration’s refrigeration wholesale operations in France and the United
Kingdom. With the acquisitions, G & L Beijer strengthens its position further in
the French and British markets. The acquisition included two companies, the
French company, Cofriset, and the British company, United Refrigeration (UK)
Ltd. The acquired companies are included in the consolidated accounts from 1
October 2011. The total consideration for the acquisitions amounted to SEK 167M.
The acquired net assets, which mainly consist of stock, trade debtors and
operating liabilities, amounted to SEK 74M, which means a surplus value of SEK
93M. The majority of the surplus value consists of goodwill and is not
tax-deductible. During 2011, the acquisitions affected the Group’s net sales by
SEK 140M. The acquisitions would have affected consolidated net sales by
approximately SEK 618M had they been included for the full year.

In November, G & L Beijer carried out two acquisitions in South Africa and
Mozambique which strengthens the Group’s position in southern Africa. In South
Africa, 100 per cent of Phoenix Racks (Pty) Ltd was acquired. Phoenix Racks
manufactures customer-adapted refrigeration units. The company reports annual
sales of approximately SEK 35M and has 23 employees. In Mozambique, G & L Beijer
acquired a newly-formed company which had acquired the assets in the company,
Logos Industrias. Logos Industrias carries out refrigeration wholesale
operations and is a distri­butor of products manufactured by G & L Beijer’s
South African operation. The company reports sales of approximately SEK 15M and
has five employees. Initially, G & L Beijer acquired 40 per cent of the
newly-formed company with an option to acquire the remaining 60 per cent within
24 months. The companies are included in the consolidated accounts from the
fourth quarter of 2011. The total conside­ration for the acquisitions amounted
SEK 17.3M and has had only a marginal effect on the Group’s net sales and
results during 2011.

At the end of the year, G & L Beijer divested the operation in its Swedish
subsidiary, Asarum Industriaktiebolag (AIA), to the Italian LU-VE Group. At the
same time, G & L Beijer entered into a global collaboration agreement with LU-VE
to distribute its products. The divestment of AIA was a step forward in G & L
Beijer’s strategy to consolidate its operation into distribution of products
within refrigeration and air conditioning. AIA’s main operation is the
production of heat exchangers. The company reports sales of approximately SEK
100M and has 75 employees. G & L Beijer’s sales will reduce by around SEK 50M
net. Profit per share will be marginally affected positively during 2012.

After the end of the financial year, G & L Beijer acquired the Norwegian
company, Ecofrigo, in January 2012. The company is project oriented within
distribution of environment-friendly chillers and refrigerants. Ecofrigo reports
sales of approximately SEK 35M and the company has six employees. The
acquisition is expected to have a marginal positive effect on G & L Beijer’s
profit per share. Ecofrigo is included in G & L Beijer’s accounts from January
2012.

Risk assessment
The operations of the G & L Beijer Group are affected by a number of external
factors, the effects of which on the Group’s operating profit can be controlled
to a varying degree. The Group’s operations are dependent on the general
economic trend, especially in Europe, which controls the demand for G & L
Beijer’s products and services. Acquisitions are normally linked with risks, for
example staff defection. Other operating risks, such as agency and supplier
agreements, product responsibility and delivery undertaking, technical
develop­ment, warranties, dependence on indivi­duals, etc, are continually being
analysed and, when necessary, action is taken to reduce the Group’s risk
exposure. In its operations, G & L Beijer is exposed to financial risks such as
currency risk, interest risk and liquidity risk. The parent company’s risk
picture is the same as that of the Group.

Financial information
- The Annual Report for 2011 will be published in April 2012.
- The Three-Month Report for 2012 will be published on 25 April 2012.

 
Malmö, 9 February 2012
G & L Beijer AB (publ)
Board of Directors

For further information, please contact:
Joen Magnusson, CEO
switchboard +46 40-35 89 00, mobile +46 709-26 50 91
Jonas Lindqvist, CFO
switchboard 040-35 89 00, mobile +46 705-90 89 04

This interim report has not been the subject of an examination
by the company’s auditors.

www.beijers.com