Solar A/S
No. 17 2014 Quarterly report Q3 2014

DGAP-News: Solar A/S

18.11.2014 / 08:00

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Quarterly Report Q3 2014
As at 24 April 2013, Solar A/S divested the subsidiary Aurora Group Danmark
A/S. The stated figures for 2013 and 2014 in this announcement, therefore,
relate to the continuing operations. 

The Solar Group's revenue and EBITA in Q3 2014 were in line with our
expectations. Expectations for underlying operations are unchanged, which is
why expectations for yearly revenue are unchanged. However, a number of
optimisation initiatives entail non-recurring costs in Denmark, Sweden, Norway
and the Netherlands, which has changed our expectations for full-year EBITA. 

CEO Anders Wilhjelm says:
'Several of our enterprises experienced negative growth in Q3, while the
enterprises in Poland, Belgium and Austria generated positive growth. As we do
not expect a significant change in the market conditions for our classic
business areas, we have started to transform Solar from a wholesaler to a
sourcing and services company with focus on customer needs. We have started a
number of optimisation initiatives, but the journey Solar has embarked upon
will take time. The transformation means that we have to become better at
developing the existing business in a profitable manner, while at the same time
exploring new opportunities. 



Select financial               EUR million                    ~ DKK million       
 highlights                                                                     
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                       Q3     Q3     Q1-Q3    Q1-Q3     Q3      Q3  Q1-Q3  Q1-Q3
                     2014   2013      2014     2013   2014    2013   2014   2013
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Revenue             356.8  368.3   1,096.4  1,127.7  2,661   2,747  8,178  8,410
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EBITA                10.0    9.5      10.8      7.9     74      71     81     59
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Earnings before       6.7    5.6       0.2     -4.3     49      43      2    -32
 tax                                                                            
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Cash flow from       14.5   18.9     -19.5     -4.6    109     141   -145    -34
 operating act                                                                  
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Select key figures                 %                              %             
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Organic growth       -1.4   -3.0      -0.3     -6.1   -1.4    -3.0   -0.3   -6.1
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EBITA margin          2.8    2.6       1.0      0.7    2.8     2.6    1.0    0.7
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Net working          13.0   13.6      13.0     13.6   13.0    13.6   13.0   13.6
 capital/rev.*                                                                  
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* Calculated as an average of the last four quarters' inventories, debtors and
creditors. 



Q3 2014 revenue:

  -- Group revenue matched our expectations
.
  -- Organic growth amounted to -1.4% against -3.0% in Q3 2013.
     Adjusted for the number of working days, organic growth amounted to -1.3%
     against -4.5% in Q3 2013.

Q3 2014 EBITA:

  -- Group EBITA matched our expectations.
  -- EBITA was affected by restructuring costs of EUR 0.4m, while Q3 2013 EBITA
     was affected by restructuring costs of EUR 0.8m and Solar 8000 costs of EUR
     0.9m.

Net working capital:

  -- Net working capital amounted to 13.3% of revenue, up from 13.2% in Q3 2013.
     When stated as an average of four quarters, net working capital was reduced
     to 13.0% of revenue from 13.6% in Q3 2013.
  -- Efforts to reduce net working capital will continue. Stated as an average
     of four quarters, our target for 2014 is to get net working capital to 13%
     of revenue. We expect net working capital of approximately 11% of revenue
     at year-end.

Expectations for 2014:

  -- Expectations for underlying operations are unchanged, which is why we
     continue to expect 2014 revenue around EUR 1,500m.
  -- However, the optimisation initiatives entail non-recurring costs which have
     changed expectations for EBITA from around EUR 23m to around EUR 9m. Normalised
     EBITA of unchanged approximately EUR 27m is expected.
  -- The optimisation initiatives in Solar's enterprises in Denmark, Sweden,
     Norway and the Netherlands described in quarterly report Q3 2014 under
     events after closing of the accounts entail that expected restructuring
     costs increase from approximately
     EUR 2m to approximately EUR 12m along with an expected write-down of assets at
     fair value of EUR 4m which total EUR 16m.
  -- All things being equal, the annual effect of these initiatives entails cost
     savings of approximately EUR 7m of which approximately 50% is expected to be
     realised in 2015. Furthermore, the invested capital is expected to be
     reduced by EUR 9m as a result of the sales of assets along with the
     optimisation of net working capital in the Netherlands.

Presentation currency:

  -- Going forward, Solar will change the presentation currency from euro to
     Danish kroner. The change is a result of our wanting to reduce complexity
     in the presentation of accounts.

Q3 presentation - audio webcast and teleconference
The presentation of Quarterly Report Q3 2014 will be transmitted online from
Nasdaq Copenhagen on Tuesday 18 November 2014 at 11.00 CET and will be
accessible via www.solar.eu. Teleconference numbers are available here: 


Participants from Denmark: tel. +45 32 72 80 18
Participants from the UK: tel. +44 145 255 5131
Participants from the USA: tel. +1 866 682 8490
International participants: tel. +44 (0) 145 255 5131


Yours faithfully

Solar A/S

Anders Wilhjelm



Attachment: Quarterly Report Q3 2014 pages 1-23

Facts about Solar
Solar A/S is a listed company and one of Northern Europe's leading sourcing and
services companies, mainly within electrical, heating, plumbing and ventilation
technologies. Solar offers products, knowledge and solutions. 

In 2013, the Solar Group, which is based in Denmark, generated revenue totalling

EUR 1,531.5m, equating DKK 11.4bn. The group currently has some 3,300 employees.
Solar is listed on Nasdaq Copenhagen with the short designation SOLAR B and has
been listed since 1953. 

For more information, please visit: www.solar.eu.

Disclaimer
This announcement was published in Danish and English today via Nasdaq
Copenhagen. In case of any discrepancy between the two versions, the Danish
version shall prevail.
News Source: NASDAQ OMX



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Language:    English       
Company:     Solar A/S     
 
 
             Denmark       
ISIN:        DK0010274844  
 
 
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297704 18.11.2014