13/02/2001
- Income for the year amounted to MSEK 94 before tax - somewhat higher than forecast
- Profit recovery during the fourth quarter
- A marked increase in profit expected in 2001
- Several new business deals within information logistics with a total annual invoiced value of MSEK 100
Income and net sales
Income for the year before tax amounted to MSEK 94, which is somewhat higher than forecast for the year. Income for the year before items affecting comparability and tax amounted to MSEK 66, which is MSEK 56 lower than the figure for 1999. Income for the fourth quarter before items affecting comparability and tax amounted to MSEK 23.
Earnings affecting comparabiIity of MSEK 28 are included in the income for the year before tax. This sum consists of earnings of MSEK 60 (surplus funds allocation from SPP and a capital gain from the sale of assets) and structural costs of MSEK 32.
Net sales during the year amounted to MSEK 2 809 of which MSEK 192 (seven months) refer to the newly acquired Siaco. Excluding Siaco, net sales amounted to MSEK 2 617 (2 568).
Both the growth of net sales and income were affected by the ongoing restructuring process within Strålfors. The development of the net sales was affected by the intensified work on streamlining the customer structure. Substantial sums have been invested in the development and establishment of new products and services. Turnover and income were also affected during the latter part of the year by a steep decline in orders to the Gaming Products segment in France and Great Britain. The fall-off was due to customers reducing their stocks. Orders are now back to their normal level.
A comprehensive programme to reduce costs and increase productivity is in progress in order to ensure the Group’s competitiveness and to reach the goals for profitability that have been set up. A decision has been taken to greatly reduce the number of employees in Switzerland and Great Britain. The goal is to have cut down the Group’s annual costs by at least MSEK 50 within six months. All the costs involved in the programme were a charge on the Group’s income for 2000.
New Group structure
As of 2001, Strålfors has a new Group structure. The company is now focusing its activities on fewer and more clearly defined business sectors: Information Logistics (with annual net sales in 2000 of MSEK 432), Graphics products and services (MSEK 1 470) and System-and Product-oriented Information transfer (SPI) (MSEK 907). The company is an organization with short channels for decisions – a result of the rapid changes Strålfors has undergone in recent years.
Information Logistics comprises one Business Area. Its operations are directed at companies and organizations that need ways and means of communicating with their end-consumers. By utilizing a well-developed and complete concept, Strålfors offers service-oriented total solutions with a high degree of value added. Here Strålfors has pooled its knowledge and resources within, for example, the field of smart cards (Card Solutions), input and output data management (InfoConcept and Electronic Document Handling), electronic processing of credit cards (Strålfors Auriga) and logistics.
The graphics business sector comprises Business Area Graphics, with gaming products and forms, and also Business Area Labels, with marking and identification.
System- and product-oriented Information transfer, SPI, comprises the Business Areas Lasermax and IT-Supplies, and also the subsidiary, Strålfors TradeCom Solutions AB.
Starting with the First Quarter Report, Strålfors will be reporting net sales and income for each of the three above-mentioned business sectors.
Acquisitions
Strålfors acquired Telia’s output data management operation on 1 February, 2001. The deal also includes an agreement on collaboration and delivery, which means that Strålfors has been commissioned to handle the printing and distribution of the telephone bills and marketing mailshots for the Telia Group’s various business areas. The contract is for three years with the option of prolongation, and is estimated to provide an additional turnover of MSEK 120 during the three-year period.
During the year, Strålfors acquired 93% of the shares in the French company Siaco S.A., which is quoted in Paris on the Second Marché. As soon as 95-percent ownership has been reached, the compulsory purchase procedure can be set in motion. The acquisition has given Strålfors access to an extensive customer and production base, which facilitates the company’s expansion on the important French market within several of Strålfors’ Business Areas. The acquisition also strengthens Strålfors’ position as the European market leader within the graphics gaming products segment.
Contracts with customers in the new business of logistics solutions
Important contracts have been signed with Canal Digital in the Nordic countries, and with the National Health Service in England. The contract with Canal Digital is initially for deliveries of printed material, smart cards, and other equipment for digital TV for their subscribers in the Nordic countries. The contract with the National Health Service means that Strålfors will be handling the distribution of primarily graphics products to a large number of hospitals in England. Both these contracts, providing annual net sales of at least MSEK 60, are expected to open up other business opportunities for Strålfors within Business Area Information Logistics. Together with the above-mentioned Telia deal, the Business Area has been supplied with annual net sales of MSEK 100.
Capital expenditure, financing and liquidity
Capital expenditure, excluding the acquisition of Siaco, amounted to MSEK 111 during the year. The acquisition of Siaco was a charge on the cash flow of MSEK 107.
Liquid funds diminished during the year by MSEK 89, and amounted at year-end to MSEK 130. In addition, there were unused credit facilities of a total of MSEK 387. The equity/assets ratio at year-end was 50%. This is seven percentage points lower than at the beginning of the year owing to the acquisition of Siaco.
Proposed dividend
The Board and Managing Director propose that the dividend should remain unchanged, i.e. SEK 1.65 per share.
The Annual General Meeting
The Annual General Meeting will be held in Ljungby on 3 May.
The Annual Report
The Annual Report is expected to be published and sent to the shareholders and other interested parties at the beginning of April. The Report can also be ordered from Strålfors.
Outlook for 2001
A considerable number of large orders were signed at the end of 2000, and, consequently, the conditions for 2001 are good. Much of the ongoing work of restructuring will have been completed by the middle of this year. In addition, strong growth is expected for Business Area Information Logistics. All in all, this should lead to a marked improvement in income.
Financial information from Strålfors
Questions or queries about the contents of this Report may be addressed to
Per Samuelson, Managing Director on +46 (0) 372-854 40, or to
Kjell Åke Jönsson, Vice Managing Director, on +46 (0)372-852 34.
The next Report, which will cover the first quarter of 2001, will be published on 3 May.
Business Concept
Stralfors is an IT-focused Business-to-Business company with a print heritage, and provides turnkey solutions within the field of information transfer. Stralfors develops, produces and delivers systems, services and products for the efficient communication of information crucial to operating a business. The Group has net sales of SEK 2.9 billion and operates in 11 countries with a total of 1940 employees, 900 of whom work in Sweden. Stralfors “B” shares have been quoted on the OM Stockholm Stock Exchange since 1984.
Ljungby, February 13, 2001
The Board of Directors