Proffice Interim report January-September 2014

PRESS
RELEASE
                 Stockholm 2014-11-13

Interim report January-September 2014

SUSTAINED PROFITABILITY DURING THE QUARTER

Q3 2014 year-on-year

  · Revenue decreased 1 per cent to SEK 1,058 million (1,066)
  · EBITA and operating profit increased 4 per cent to SEK 52 million (50)
including restructuring costs of SEK 3 million (0)
  · EBITA and operating margin stood at 4.9 per cent (4.7)
  · Basic earnings per share declined to SEK 0.53 (0.66)
  · Cash flow from operating activities totalled SEK -22 million (62)

YTD 2014 year-on-year

  · Revenue decreased 4 per cent to SEK 3,132 million (3,258)
  · EBITA and operating profit increased 8 per cent to SEK 97 million (90)
including restructuring costs of SEK 13 million (5)
  · EBITA and operating margin stood at 3.1 per cent (2.8)
  · Basic earnings per share declined to SEK 0.97 (1.16)
  · Cash flow from operating activities totalled SEK 1 million (116)

 Financial overview

                           Q3                      YTD                     Full
                                                                           year
Group                      2014   2013   Change    2014   2013   Change    2013
Revenue, SEK million       1,058  1,066  -1%       3,132  3,258  -4%       4,318
EBITA and operating        52     50     4%        97     90     8%        125
profit, SEK million
EBITA and operating        4.9    4.7    -         3.1    2.8    -         2.9
margin, %
Profit after tax, SEK      36     44     -18%      66     79     -16%      104
million
Basic earnings per share,  0.53   0.66   -20%      0.97   1.16   -16%      1.52
SEK
Diluted earnings per       0.53   0.66   -20%      0.97   1.16   -16%      1.52
share, SEK
Cash flow from operating   -22    62     -         1      116    -         207
activities, SEK million
Cash flow from operating   -0.32  0.90   -         0.01   1.69   -         3.03
activities per share, SEK
Basic equity per share,    9.01   7.95   13%       9.01   7.95   13%       8.37
SEK
Return on equity, %        15.7   14.0   -         15.7   14.0   -         19.2

Comments by Henrik Höjsgaard, CEO

Sustained profitability during the quarter
Proffice sustained its operating margin despite an uncertain market. The
operating margin for the quarter amounted to 4.9 per cent (4.7). Revenue
totalled SEK 1,058 million (1,066). Calendar-wise, the third quarter is a strong
quarter with many invoicing days and few holidays.

Increased focus on prices boosted profitability in Sweden
In order to invigorate, reenergize, and increase efficiency in the company, a
reorganization was initiated in Q2, primarily in the Swedish operation. The
reorganization has been fully implemented. In conjunction with this, a total of
SEK 13 million encumbered earnings, of which SEK 3 million in the third quarter.
An increased focus on profitability and favourable calendar effects strengthened
the Swedish operating margin, which was 6.0 per cent for the quarter and was the
best result since Q2 2012.

Sales in Sweden continued to decline slightly, primarily in the Staffing and
Outplacement operating areas. A general increase in uncertainty about the
economy made many customers more cautious.

Revenue increased in Norway, Finland, and Denmark
Revenue increased in Norway, Finland, and Denmark despite markets that continued
to be challenging. In Norway, revenue increased in all areas of competence
except Finance and Office & Customer Service. During the quarter, Proffice
entered into a new agreement with PostNord in Norway for staffing and
outplacement services. Our initiatives in Stavanger continued with an expansion
of our service offering, since this is a geographic area with great potential.

In Denmark, Aviation stood for much of the revenue since demand continued to be
high for summer staffing of cabin crews during the first part of the quarter.

Increased market uncertainty
Uncertainty in the market is greater than usual. This is due to the economic
climate and to increased uncertainty about conditions for employers in general
and for the staffing industry in particular. In Sweden, the new government
proposed raising the reduced payroll tax for young workers in its budget. Like
other industries with many employees under 27 years old, the staffing industry
and our customers will be affected. Any cost increases must ultimately be passed
on to customers.

Continued focus on interactions with customers
Proffice will continue to focus on interactions with customers in the form of a
stronger sales organisation and system support. The implemented changes have
allowed the organization to grow, and in the coming quarters we will hire more
salespeople and recruiters. As previously announced, we are investing SEK 20-25
million per year in 2014 and 2015 in increased system support. In October, for
example, new responsive websites were launched to improve accessibility for
candidates and customers. Implemented and future activities will help us in our
quest to be the most successful staffing company in the Nordics.

Henrik Höjsgaard
President and CEO

If you have questions about this interim 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 is the specialised flexible staffing company with around 10,000
employees in the Nordic region. We provide temporary staffing, recruitment
services, and outplacement. Proffice is listed on the 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 13 November 2014 at 8 am CET.