Opus Group AB
Interim Report (Jan – Sept, 2011)
Opus Prodox AB 24.11.2011 11:16 --------------------------------------------------------------------------- Gothenburg, Sweden, 2011-11-24 11:16 CET (GLOBE NEWSWIRE) -- Key Highlights > EBITDA of SEK 26.0 million, 15 percent margin, equivalent to an increase of 33 percent* year-to-year > Continued good profitability in North America - EBITDA margin of 29 percent > Continued positive development in Europe & Asia - organic growth of 13 percent* and EBITDA margin of 7 percent > Cash flow from operating activities of SEK 20.0 million Interim Period (January - September, 2011) * Sales increased to SEK 168.2 million (167.6) * EBITDA increased to SEK 26.0 million (24.0), equivalent to an EBITDA margin of 15.4 percent (14.2) * Cash flow from operating activities before changes in working capital increased to SEK 24.5 million (20.4) * Net earnings increased to SEK 0.5 million (-5.2) * Earnings per share after dilution amounted to SEK 0.00 (-0.03) Reporting Period (July - September, 2011) * Sales decreased to SEK 49.0 million (54.5) * EBITDA increased to SEK 8.5 million (8.2), equivalent to an EBITDA margin of 17.3 percent (14.9) * Cash flow from operating activities before changes in working capital increased to SEK 8.5 million (7.4) * Net earnings increased to SEK 0.5 million (-5.4) * Earnings per share after dilution amounted to SEK 0.00 (-0.03) *For comparable units and in local currencies. Good profitability and strong cash flow The North American business continues to deliver strong profitability with an EBITDA margin of 31 percent for the third quarter. Organic growth was negative 6 percent, but despite this, the business area delivered an increased EBITDA of SEK 6.7 million for the quarter. Efforts to grow in the U.S. market are in full swing with several contract renewals in the third quarter, as well as the receipt of the intent to award a new vehicle inspection contract for the state of Wisconsin. In addition, during this autumn, a number of government contracts in the U.S. vehicle inspection market have come out for bidding. In Europe & Asia, growth was negative 5 percent, however the business area delivered an increase in EBITDA of SEK 1.8 million compared with SEK 1.3 million in the third quarter of 2010. Europe & Asia reports an EBITDA margin of 6.5 percent for the third quarter. Our growth efforts are focused on markets where legislation is driving the need for new equipment. At the same time, we are working to increase the service business and add more consumable products to our range of offerings in order, to reduce cyclical sensitivity, and create a more stable cash flow. For the group as a whole, we note that growth has been negative in the third quarter, but it is management's assessment that this is temporary and that organic growth will be positive next year. Operations delivered a total EBITDA of SEK 8.5 million for the third quarter, and SEK 26 million for the interim period, representing an increase of approximately 33 percent in local currency. Cash flow for the third quarter was strong at SEK 8.5 million, as the company continues to utilize cash flow to repay outstanding loans. This is reflected in the net debt, which at the end of the quarter is now down to SEK 22.6 million, including real estate loans in the U.S. at SEK12.3 million. The company is planning to list its shares on the OMX stock exchange. In connection with this, Management has reviewed historical acquisitions and reclassified a portion of Goodwill to Customer Contracts and Relationships, which will be amortized over time. See Note 1 for further details. Gothenburg, Sweden, in November, 2011 Magnus Greko President and CEO Notable Events During the Interim Period State of Oregon Grants Contract Extension to SysTech On September 14, 2011, Opus announced that The Oregon Department of Environmental Quality (DEQ), has granted a one plus one year contract extension to Opus subsidiary, SysTech International, LLC Since the contract began in 2006, SysTech has provided numerous services in support of DEQ's vehicle emission inspection program including: design, manufacturing, delivery and onsite service of Oregon's Emission Inspection Equipment and Vehicle Inspection Database; the industry's first 24/7 self-service OBD Kiosk inspection lane; and the innovative wireless remote OBD System. The Oregon DEQ operates seven centralized inspection facilities in the greater Portland area. Using SysTech equipment and systems, they inspect 800,000 vehicles each year. State of Missouri Grants Contract Extension to SysTech On September 22, 2011, Opus announced that The Department of Natural Resources (DNR) has granted a two year contract extension to Opus subsidiary, SysTech International, LLC. In 2007, SysTech was contracted by DNR to design, build and operate the Gateway Vehicle Inspection Program (GVIP). The GVIP addresses 1.4 million vehicles that are required to pass safety and emissions inspections in the greater St. Louis area. SysTech Receives Award for Wisconsin I/M Program Contract On September 29, 2011, Opus announced that the Wisconsin Department of Transportation (WisDOT), after completing its evaluation of a competitive bidding process, has issued the intent to award the State of Wisconsin emissions testing program contract to Opus subsidiary, SysTech International, LLC. Testing will begin in July 2012. SysTech and WisDOT are currently negotiating a five year contract with two three year extensions, for a total of 11 years. The WisDOT emission testing program addresses over a million vehicles, which are required to pass emissions inspections in the seven most populated counties in Wisconsin. Notable Events After the End of the Period Opus Group has reached an agreement to take over operations from Volvo Cars Sweden AB On November 15, 2011, Opus announced that its wholly-owned subsidiary Opus Bima AB, has reached an agreement to take over, by means of an asset deal, a part of Volvo Cars Sweden operations for the sale of hand tools and consumables to, among others, Swedish Volvo dealers. The takeover is expected to occur during the fourth quarter and will be financed through existing cash resources. The takeover is expected to have a positive impact on earnings per share following the transfer of the operations. Opus and Carspect agree to cooperate to establish vehicle inspection in Sweden On November 17, 2011, Opus announced that during this spring, it had signed an agreement to establish vehicle inspection at Bilia's locations in Sweden. In this new cooperation, Opus will be responsible for test equipment, installation, maintenance and calibration, while Carspect is the operator and runs the vehicle inspection stations under its own brand, with its own staff. Sales and Results Report period Sales for the current reporting period amounted to SEK 49.0 million (54.5). Organic growth was approx. -11 percent (11)*. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to SEK 8.5 million (8.2). The EBITDA margin equated to 17.3 percent (14.9). Interim period Sales for the current interim period amounted to SEK 168.2 million (167.6). Organic growth was approx. 0 percent (8)*. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to SEK 26.0 million (24.0). The EBITDA margin equated to 15.4 percent (14.2). In connection with the SysTech acquisition in April, 2008, the company acquired Intellectual Propety (IP) of USD 12.3 million. This includes patents, software and systems, and is amortized over five (5) years, affecting the Group's net earnings. In addition, the Group amortizes Customer Contracts and Relationships over their esti-mated useful lives which also affects the Group's net earnings (see Note 1). For this reason, the company uses EBITDA, which excludes inter alia amortization, as a key performance measurement of the Group's profitability. Business Areas Starting 2011, Opus consolidates Europe and Asia into one business area. Reporting to the Group Management Team and the Board of Directors is in accordance with this new structure. Opus operations are therefore now divided into Europe & Asia and North America. Previously published amounts have been restated to conform to the current Group structure in 2011. Europe & Asia Sales for the current reporting period amounted to SEK 27.4 million (28.8). Organic growth was approx. -5 percent (25)*. EBITDA amounted to SEK 1.8 million (1.3), equivalent to an EBITDA margin of 6.5 percent (4.4). Sales for the current interim period amounted to SEK 106.4 million (94.3). Organic growth was approx. 13 percent (16)*. EBITDA amounted to SEK 8.1 million (1.6), equivalent to an EBITDA margin of 7.5 percent (1.6). The average number of employees during the current interim period was 70 (68). North America Sales for the current reporting period amounted to SEK 21.5 million (25.7). Negative organic growth was approx. -6 percent (-1)*. EBITDA amounted to SEK 6.7 million (6.4), equivalent to an EBITDA margin of 31.0 percent (24.9). Sales for the current interim period amounted to SEK 61.8 million (73.3). Negative organic growth was approx. -3 percent (-2)*. EBITDA amounted to SEK 17.9 million (21.7), equivalent to an EBITDA margin of 28.9 percent (29.6). The average number of employees during the current interim period was 97 (105). Customers Opus customers are government agencies (counties, states etc.), the automotive industry,vehicle garages, and vehicle inspection companies (state and privately owned). Opus has no individual customers that represent more than 10 percent of the Group's turnover. Investments Investments during the interim reporting period amounted to SEK 2.3 million (8.0) and consist mainly of ongoing development projects amounting to SEK 1.1 million (1.9) and investments in furnishings, machinery and other technical equipment amounting to SEK 1.2 million (6.1). Financial Position and Liquidity The equity ratio amounted to approximately 76.5 percent (72.6) at the end of the period. The cash flow from operating activities before changes in working capital was SEK 24.5 million (20.4) during the current interim period. Cash and cash equivalents at the end of the period equated to SEK 19.3 million (14.3) and unused credit facilities amounted to SEK 6.0 million (2.7) at the end of the period. Taxes The tax expense for the period is calculated using the current tax rate for the Parent company and each subsidiary. Temporary differences and existing fiscal loss carry-forwards have been taken into account. Employees The average number of FTEs (full-time equivalents) in the Group was 167 (173) during the current interim period. Contingent liabilities The Group had no contingent liabilities at the end of the interim reporting period. Contingent liabilities at the end of the 2010 financial year includes a bid guarantee in North America, which was relaeased during the first quarter of 2011. Parent Company The Parent company's sales during the current reporting period amounted to SEK 10.4 million (12.0) and profit after financial items to SEK -0.5 million (-2.0). The Parent company's sales during the current interim period amounted to SEK 40.9 million (43.7) and loss after financial items to SEK -1.4 million (-2.3). Related Parties No significant transactions with related parties have taken place during the interim reporting period. Accounting and Valuation Policies This report has been prepared in accordance with IAS 34, Interim Financial Reporting. The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by EU. The interim report for the Parent company has been prepared in accordance with the Swedish Annual Accounts Act and recommendation RFR 2. The same accounting and valuation policies were applied as in the 2010 Annual Report, with the exception of the reclassification of a portion of Goodwill to Customer Contracts and Relationships. This adjustment has been made in accordance with IAS 8, as described in Note 1. In addition, a change in segment reporting starting in 2011, has resulted in previously published amounts being restated to conform to the current Group structure. New standards and interpretations effective January 1, 2011 have not had any significant impact on the Group's financial statements. Accounting Estimates and Assumptions The preparation of financial reports in accordance with IFRS requires the Board of Directors and Management to make estimates and assumptions that affect the application of accounting principles and the carrying amounts of assets, liabilities, revenue and expenses. Actual outcomes may deviate from these estimates. Translation of Foreign Operations Assets and liabilities in foreign entities, including goodwill and other corporate fair value adjustments, are translated to Swedish kronor at the rate prevailing on the balance sheet date, meanwhile all items in the income statement are translated using an average rate for the period. On translation of foreign operations, the following exchange rates have been used: Essential Risks and Uncertainty Factors Opus Prodox AB (publ) and the Opus Group companies are through their activities at risk of both financial and operational nature, which the companies themselves may affect to a greater or lesser extent. Within the companies, continuous processes are ongoing to identify possible risks and assess how these should be handled. The companies' operations, profitability and financial conditions are directly related to investments within the automotive industry and regulations within environmental and safety testing of vehicles. With the recent dramatic development of the global economic climate, there is a general insecurity, which in the short term results in an increased risk and uncertainty in respect of Opus sales, profitability and financial condition, primarily in the business segment Europe & Asia which is more dependent of the equipment business. In North America, the Group runs vehicle inspection programs through long-term contracts with government agencies. There is a risk of early contract termination which would affect the Group's financial position negatively. Furthermore, the Group has a currency risk through its translation exposure of the operations in the U.S. A detailed description of the Parent company and subsidiaries' risks and risk management are given in Opus Annual Report 2010. Outlook In North America, the company sees opportunities throughout the next year when a number of government contracts in the U.S. vehicle inspection market are scheduled to come out for bidding. In addition, there are several interesting new markets outside the U.S. where the demand for environmental and safety testing of vehicles is increasing. In Europe and Asia, the focus is to continue to grow profitably. In the future, there are several government-run programs in which vehicle inspection programs shall need to be updated or expanded. The Opus organization, with its own products developed in Europe and the United States, and with it's own production operation in China, provides a competitive advantage for the company internationally. This outlook supersedes the outlook provided in the Q2 2011 interim report. Opus does not provide financial forecasts. Financial Information The year-end report 2011 will be published on February 23, 2012. This report has been subject to auditors' review. Gothenburg, Sweden, November 24, 2011 Magnus Greko President and CEO Contact Information Opus Prodox AB (publ), (org no 556390-6063) Bäckstensgatan 11C SE-431 49 Mölndal, Sweden Phone: +46 31 748 34 00 Fax: +46 31 28 86 55 E-mail: info@opus.se www.opus.se For any questions regarding the interim report, please contact Magnus Greko, President and CEO, +46 31 748 34 91 or Göran Nordlund, Chairman of the Board, +46 70 433 13 20. Opus Certified Adviser Thenberg & Kinde Fondkommission AB Box 2108 SE-403 12 Gothenburg, Sweden Phone: +46 31 745 50 00 Opus Prodox AB (publ) in Brief The Opus Group is in the business of developing, producing and selling products and services within Automotive Test Equipment, Vehicle Inspection Systems and Fleet Management for the global market. The products include emission analyzers, diagnostic equipment, and automatic test lanes. Services include management of mandatory vehicle inspection programs. The Group sells its products and services in more than 50 countries all over the world and currently has around 160 employees. The turnover for 2010 was roughly SEK 230 million. Opus' share is listed on First North Premier (NASDAQ OMX) under the ticker OPUS. News Source: NASDAQ OMX 24.11.2011 Dissemination of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Opus Prodox AB Sweden Phone: Fax: E-mail: Internet: ISIN: SE0001696683 WKN: End of Announcement DGAP News-Service ---------------------------------------------------------------------------
Aktuelle News
Aktuelle Berichte
Keine Berichte gefunden
Anstehende Events
Keine Events gefunden
Webcasts
Keine Webcasts gefunden