Continued strong growth and improved margin
The second quarter of 2018
Net sales increased 19 percent to 980 (823) MILLION. The organic growth was 9 per cent
The order intake increased by 18 per cent and was in line with the sales
Operating profit (EBITA) increased to sek 98 (78) MILLION and the operating margin to 10.0% (9.5)
Earnings per share amounted to 1.78 (1,41) $
January — June 2018
Net sales increased by 18 per cent to 1 925 (1 638 M). The organic growth was 10 per cent
The order intake was in line with the sales
Operating profit (EBITA) increased to 204 (170) MILLION and the operating margin amounted to 10.6 percent (10,4)
Earnings per share rose to 3,77 (3,05) $
THE GROUP IN SUMMARY
The good development that characterized the beginning of the year also continued during the second quarter. The growth was 19% and was driven by acquisitions, increased market share and good underlying growth, but also to positive calendar effects.
Segment International accelerated the fine resultattrend as we have seen in recent years. Through the strengthening of market shares in most markets as well as through the successful acquisitions we have achieved a growth of 25%. The gross margin could be significantly improved thanks to currency effects and price increases exceeded the materialdrivna the cost increases we have been forced to take. Pleasing was also that the growth could take place without a corresponding increase of operating expenses. Overall, operating profit grew by over 50%. Success brings confidence, and the scope for continued investments in the segment.
Segment Sweden had a worse earnings performance in the quarter. The growth was good, but gross margin lower than earlier in the year than 2017. Thus, we have not fully managed to offset the continued negative trend for the krona and raw material prices with price increases to customers. The work continues, however, with the ambition to eventually produce a strong and stable gross margin regardless of external factors. Furthermore, the segment of a too high cost level in the quarter, partly because of the adjusted reserves as well as currency effects. All in all, operating income fell, a development that we can not be happy with.
The uncertainty about the further economic trend has increased during the quarter due to, among other things, fears of a trade war. This is reflected, for example, in the slightly weaker purchasing managers index, but has not yet made an impression in Bufabs orders. While we are vigilant for signs of decline, we have the ambition to increase our market share in at least the same rate as in the past.
We need to increase our gross margin through further price increases. Further, we need to strive to operating expenses does not increase further as a percentage of sales despite the significant investments we make in our program for «Leadership». It requires extensive efficiency improvements in the business in general.
Looking to Bufab as a whole we are pleased with the quarter and the first half of 2018. Good growth, improved margins, and Bufabs so far the best halvårsvinst is evidence that our strategy of organic and acquisition-driven growth works. Encouraged by this, we continue to increase investment in our strategy. The goal is to be the leading company in our industry in the year 2020.
President and CEO
A conference call will be held on July 19, 2017 at 10: 00 CET. Jörgen Rosengren, PRESIDENT & chief executive officer, and Marcus Andersson, CFO will present the results. The conference will be held in English.
To participate in the conference, use one of the following number; +44 (0) 2071 928000, UK 08445718892, Sweden 08 50692180 options USA 16315107495. Konferenskod: 1355767.
Please call 5-10 minutes before the conference call, because a short registration is necessary.
+46 370 69 69 00
+46 370 69 69 66
This information is such information that Bufab AB (publ) is obliged to publish under the EU marknadsmissbruksförordning. The information was submitted, through the above contacts in the government, for publication on 19 July 2018 at 7.30 CET.
Bufab AB (publ) Box 2266 331 02 Värnamo, sweden, org nr 556685-6240
Tel 0370 69 69 00, Fax: 0370 69 69 10
Interim report Q2 2018 — FINAL ENG
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Source: Bufab Group via Globenewswire