Proffice Interim Report January-June 2013

PRESS
RELEASE
                  Stockholm 2013-08-21

Increased profitability compared with first quarter

Q2 2013 year-on-year comparison

  · Revenue decreased 13 per cent to SEK 1,130 million (1,295)
  · Other operating income totalled SEK 0 million (13)
  · EBITA and operating profit declined 44 per cent to SEK 30 million (54)
  · EBITA and operating margin totalled 2.7 per cent (4.2); excluding other
operating income, the corresponding margin totalled 2.7 per cent (3.2)
  · Basic earnings per share totalled SEK 0.32 (0.55)
  · Cash flow from operating activities totalled SEK 2 million (-73)

YTD 2013 year-on-year comparison

  · Revenue decreased 12 per cent to SEK 2,192 million (2,495)
  · Other operating income totalled SEK 0 million (13)
  · EBITA and operating profit declined 57 per cent to SEK 40 million (94)
  · EBITA and operating margin totalled 1.8 per cent (3.8); excluding other
operating income, the corresponding margin totalled 1.8 per cent (3.2)
  · Basic earnings per share totalled SEK 0.51 (0.90)
  · Cash flow from operating activities totalled SEK 46 million (-124)

Financial overview

                             Q2            Change   YTD           Change  Full
                                                                          year
Group                        2013   2012   quarter  2013   2012   YTD     2012
Revenue,   SEK million       1,130  1,295  -13%     2,192  2,495  -12%    4,876
Other   operating income,    0      13     -        0      13     -       40
SEK million*
EBITA,   SEK million         30     54     -44%     40     94     -57%    110
EBITA   margin, per cent     2.7    4.2    -        1.8    3.8    -       2.3
Operating   profit, SEK      30     54     -44%     40     94     -57%    110
million
Operating   margin, per      2.7    4.2    -        1.8    3.8    -       2.3
cent
Profit   after tax, SEK      22     39     -44%     35     65     -46%    78
million
Basic   earnings per share,  0.32   0.55   -42%     0.51   0.90   -43%    1.11
SEK
Diluted   earnings per       0.32   0.55   -42%     0.51   0.90   -43%    1.11
share, SEK
Cash   flow from operating   2      -73    -        46     -124   -       0
activities, SEK million
Cash   flow from operating
activities per
share,   SEK                 0.03   -1.06  -        0.67   -1.81  -       0.00
Basic   equity per share,    7.47   7.27   3%       7.47   7.27   3%      7.46
SEK
Return   on equity, per      9.7    26.3   -        9.7    26.3   -       12.9
cent

*Deviation between actual additional purchase price from previous acquisitions
and expected outcome.

Comments from Lars Kry, CEO

Increased profitability compared with first quarter

After several quarters marked by market turmoil, we can discern a certain
optimism in the economic figures. Overall, we seem to see a slightly more
positive business climate for our customers and an increase in activity levels.
Our main business areas, Office & Customer Service and Industry & Logistics,
grew compared to the first quarter of 2013.

Compared with the first quarter, Proffice’s operating profit tripled in the
second quarter and revenue increased. We now show positive earnings in all
countries. The improved earnings come partly from seasonal variations, but are
also a result of the extensive action plan initiated when the market declined in
autumn 2012. We will soon see the full effects of these cost savings, which are
expected to reach SEK 220 million annually.

Despite the Group’s positive growth in profitability compared to the first
quarter, it is far from the record levels of the corresponding quarter of 2012.
We attained an EBITA margin for the second quarter of 2.7 per cent (4.2),
impacted by higher guaranteed wages and downward pressure on prices.

Continued cautious business climate in Sweden

The Outplacement operating area growing and Recruitment shrinking compared to
the same quarter last year testifies to the continued weak business climate in
Sweden. Revenue fell by 17 per cent compared with the same quarter last year and
we attained an EBITA margin for the quarter of 2.9 per cent (6.8).

In the second quarter we saw an improvement in the most cyclically sensitive
sectors, and we had positive revenue growth compared with the first quarter,
particularly in the industrial segment. Continued cost awareness and internal
efficiency also helped to increase profitability. The proportion of revenue from
small and medium-sized customers continued to increase, affecting both
profitability and cash flow in a positive direction. However, demand from of a
number of our major customers was significantly lower in the first half than the
same time last year. During the quarter, we signed agreements with several new
customers, including Pon Equipment and E.ON. After the quarter, we also renewed
and developed our partnership with ICA.

Tougher economic climate impacts Norwegian market

The weaker business climate combined with continued uncertainty among customers
with the introduction of the so-called Vikarbyrå Directive impacted our
operations in Norway during the second quarter.

Revenue during the quarter totalled SEK 262 million (279), which is not in line
with our growth ambitions in Norway. Compared with the first quarter of 2013,
however, revenue increased by 8 per cent, and the EBITA margin improved to 4.6
per cent.

Although Norwegian economic growth has slowed somewhat, unemployment figures
continue to be low and there are skills shortages in several sectors of the
Norwegian labour market. To meet these skill needs, Proffice will establish a
global sourcing organisation that will search for skilled labour within and
outside the Nordic borders. This will be part of a long-term initiative to
further strengthen our market position in Norway.

During the quarter, we signed and developed several important agreements,
including one with TUI Nordic for which we provide cabin crew for their
operations out of Gardermoen airport in Oslo.

Increased growth and profitability in Denmark and Finland

Establishment of our specialist company, Proffice Aviation, in Denmark and
Finland continues to reap success. Proffice Denmark increased its revenue to SEK
12 million (4) and presented positive earnings for the sixth consecutive
quarter. Our operation in Finland was also in the black, with a revenue increase
of 40 per cent compared with the same quarter last year.

Long-term vision holds steady

The Group’s focus areas for 2013 are Industry & Logistics, Norway, Sales,
Sourcing, and Efficiency. Our initiatives have already had an impact on a number
of focus areas, and we will continue our long-term efforts to become the most
successful staffing company in the Nordics.

We are feeling a certain degree of optimism in the market, so we must be
prepared to meet increased demand with attractive products and services and high
selling pressure, while keeping costs under control.

Regardless of economic conditions, our expertise, flexibility, and speed have
become increasingly important, as companies want variable costs and a focus on
their core business. We will continue to win our customers’ trust and gain
market share in a highly competitive market.

Lars Kry
President and CEO

If you have questions about this interim report, please contact:

Lars Kry, President and CEO, telephone +46 8787 17 00, lars.kry@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 is the specialised flexible staffing company with more than 10,000
employees in the Nordic region. We provide temporary staffing, recruitment
services, and outplacement. Proffice is listed on the NASDAQ OMX 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 21 August 2013 at 8 am CET.