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2006 10-02 Q4 & Full Year 2005/2006 Results
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2006 10-02 Q4 & Full Year 2005/2006 Results

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  • 1. The Fourth Quarter and the Full Year Reportfor the period of 1 Sept 2005 to 31 Aug 20062 October 2006Christian W. JanssonCEOHåkan WestinCFO 1
  • 2. Disclaimer• These materials may not be copied, published, distributed or transmitted to third parties• These materials may contain forward-looking statements. If so, such statements are based on our current expectations and are subject to risks and uncertainties that could negatively affect our business. Please read our earnings report and our most recent annual report for a better understanding of these risks and uncertainties.• These materials do not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities, nor shall part, or all, of these materials or their distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation to any securities. These materials and the information contained herein are no an offer of securities for sale in the United States and are not for publication or distribution to persons in the United States. 2
  • 3. Agenda I Business HighlightsII Results Q4III Results 2005/2006IIII Key ConclusionsIV Recent Activities 3
  • 4. Business Highlights IBusiness Highlights• 2005/2006 – the best year so far. – Improved gross margin. – Successful purchasing. – Good inventory control.• Continued good general retail demand.• Store expansion program on track. – Two new stores during Q4. – Total 20 new stores and two closures in 05/06. – Current network of 260 stores and 26 contracts for new store openings. 4
  • 5. Results Q4 II Financial Highlights Q4• Sales increased by 2.3 percent to MSEK 1 010 (987).• Gross margin improved to 63.3 (60.5) percent.• Operating profit increased to MSEK 173 (119) of which MSEK 26 was an one-off item.• Operating margin improved to 17.1 (12.1) percent.• Profit after taxes was MSEK 116 (63), corresponding to SEK 1.54 (0.84) per share. 5
  • 6. Results Q4 II Financial Highlights Q4 2004/2005 vs. 2005/2006 -2,0% +5,3% -1,0% 2,3% 1 100 53 -10 -7 1 010 1 000 987 -20 • FX impact was negative. • Net new stores largest growth 900 contributor with 5.3 percent. • LFL -1.0 percent impacted bySEKm 800 discontinued cosmetics sales in Norway MSEK 0 (20). 700 • LFL excluding cosmetics 600 was +1.1 percent. 500 Q4 FX Net LFL Q4 04/05 effect new growth 05/06 MSEK stores 6
  • 7. Results Q4 II Profitability Drivers Q4 2004/2005 vs. 2005/2006MSEK 05/06 04/05Gross profit 639 597Gross margin 63,3% 60,5% • Strong gross margin, even when excluding one-off itemSelling expenses -431 -447 of MSEK 26.% of sales 42,7% 45,3%Admin expenses -35 -31 • Selling expenses positively% of sales 3,5% 3,1% effected by reallocated pension costs of MSEK 14.EBITDA 223 159EBITDA margin 22,1% 16,1%Operating profit 173 119Operating margin 17,1% 12,1% 7
  • 8. Results Q4 IIIncome Statement Q4MSEK 05/06 04/05Net sales 1 010 987Cost of goods sold -371 -390Gross profit 639 597Selling expenses -431 -447Administrative expenses -35 -31Operating profit 173 119Financial income 0 3Financial expense -12 -48Profit before tax 161 74Tax expense -45 -11Net profit 116 63 8
  • 9. Results 2005/2006 III II Financial Highlights Full Year• Sales increased by 6.9 percent to MSEK 4 217 (3 945).• Gross margin improved to 60.2 (58.6) percent.• Operating profit increased to MSEK 530 (403) of which MSEK 22 was an one-off item.• Operating margin improved to 12.6 (10.2) percent.• Profit after taxes was MSEK 302 (264), corresponding to SEK 4.02 (3.52) per share. 9
  • 10. Results 2005/2006 III II Financial Highlights Full Year 2004/2005 vs. 2005/2006 +2,2% +5,0% -0,3% 6,9% 4 800 4 217 • Favourable FX impact, mainly 4 400 197 -7 -12 due to strong NOK. 3 945 87 4 000 • Net new stores largest growth contributor with 5.0 percent. 3 600SEKm • LFL -0.3 percent impacted by 3 200 discontinued cosmetics sales in Norway MSEK 38 (97). 2 800 • LFL excluding cosmetics 2 400 was +1.2 percent. 2 000 FY FX Net LFL FY 04/05 effect new growth 05/06 stores MSEK 10
  • 11. Results 2005/2006 III IISales Breakdown Full Year 2004/2005 vs. 2005/2006 Growth MSEK 05/06 04/05 SEK Loc. cur. Sweden 2 365 2 267 4.3% 4.3% Norway 1 237 1 132 9.2% 3.7% Finland 473 429 10.3% 8.9% Poland 142 117 21.2% 11.2% Total 4 217 3 945 6.9% Poland Finland 3(3)% 12(11)% Sweden Norway 56(57)% 29(29)% 11
  • 12. Results 2005/2006 III II Profitability Drivers Full Year 2004/2005 vs. 2005/2006MSEK 05/06 04/05Gross profit 2 540 2 310Gross margin 60,2% 58,6% • Strong development of gross margin.Selling expenses -1 863 -1 781% of sales 44,2% 45,1% • Selling expenses in percentAdmin expenses -147 -126 reduced due to economies% of sales 3,5% 3,2% of scale in increased number of stores.EBITDA 707 555EBITDA margin 16,8% 14,1%Operating profit 530 403Operating margin 12,6% 10,2% 12
  • 13. Results 2005/2006 III IIIncome Statement Full Year MSEK 05/06 04/05 Net sales 4 217 3 945 Cost of goods sold -1 677 -1 635 Gross profit 2 540 2 310 Selling expenses -1 863 -1 781 Administrative expenses -147 -126 Operating profit 530 403 Financial income 2 6 Financial expense -113 -109 Profit before tax 419 300 Tax expense -117 -36 Net profit 302 264 13
  • 14. Results 2005/2006 III II Cash Flow Q4 Full YearMSEK 05/06 05/06Cash flow from operations before working capital changes 180 474Changes in working capital -63 -7Cash flow from operating activities 117 481Cash flow investing activities -44 -225Cash flow after investments 73 256Cash flow from financing activities -39 45Dividend 0 -169Change in revolving credit -70 -142Net cash flow for the period -36 -10Cash and bank balances at beginning of period 109 83Cash and bank balances at end of period 73 73 14
  • 15. Key Conclusions IIIIKey Conclusions and Outlook • Best year so far • First class growth margin • Excellent inventory control • Weak sales Focus going forward • More emphasis on overall sales • Continue new store expansion program • Maintain gross margin 15
  • 16. Recent Activities IVRecent Activity 16
  • 17. We don’t believe in selling a lifestyle. You have one already.We don’t believe in expensive collections for an exclusive few. We believe in fashion that suits you. We don’t believe in eternal youth, however we believe that people mature, grow wiser and even more beautiful. Take it as a compliment. 17