Interim Report January – September 2018
Action programme delivers results
- Net sales amounted to SEK 515.5 million (542.9)
- EBITA amounted to SEK 17.5 million (3.5) and the EBITA margin was 3.4% (0.6)
- Operating profit (EBIT) amounted to SEK 14.6 million (0.5) and the operating margin was 2.8% (0.1)
- Profit after tax was SEK 13.4 million (-5.7)
- Earnings per share before and after dilution were SEK 0.73 (-0.37)
- Cash flow from operating activities totalled SEK -34.6 million (-35.0)
- Total cost of restructuring measures was SEK 0.0 million (0.0)
January - September
- Net sales amounted to SEK 1,721.0 million (1,794.0)
- EBITA (adjusted) amounted to SEK 62.1 million (37.3) and the adjusted EBITA margin amounted to 3.6% (2.1)
- Operating profit (EBIT) amounted to SEK 4.3 million (15.8) and the operating margin was 0.2% (0.9)
- Profit after tax was SEK -1.3 million (5.0)
- Earnings per share before and after dilution were SEK -0.13 (0.33)
- Cash flow from operating activities totalled SEK 35.0 million (-61.2)
- Total cost of restructuring measures was SEK 53.4 million (12.2)
Statement by the President and CEO
It is gratifying to see that the structural changes and efficiency measures that we implemented during the year are beginning to bear fruit in terms of positive effects on both our business and our results. The first stage of our transition has been successfully navigated and our journey of change to achieve our full potential is continuing. Rejlers Finland developed strongly during the third quarter and has shown further positive organic growth. The reorganisation in Sweden has resulted in the business now being based around industries and customer segments, rather than regions, which over time will lead to a more customer-led Rejlers. The merger of our Norwegian operations gives us an opportunity to focus on the areas where we see the greatest potential for growth in the future. Overall, we now have a more stable platform and a clear organisation to gradually strengthen both our market position and our profitability.
We have now completed the first phase towards our goal of establishing a more efficient, profitable and sustainable Rejlers through a new organisational structure and transformation and refining of the business. We are now well-equipped to take the next step in our journey of change by updating our vision and strategy over the next year, as well as starting the process of modernising our vital employer brand. In September, we assembled all Rejlers managers to jointly lay the foundations for this process of change.
Our goal is to become an even more attractive consultancy firm with a strong focus on employees, customer benefits and shareholder value. As part of this objective, we are now building up our own professional recruitment organisation in our largest cities. To add additional customer benefit, we will also launch our digital business platform ‘Rejlers Network’ during the fourth quarter to further augment our expertise.
Profitability and sales
EBITA rose to SEK 17.5 million (3.5) as a result of efficiency measures and an increase in utilisation. Sales during the third quarter fell by 5 per cent to SEK 516 million. This downturn is explained in its entirety by structural changes in the form of divestments of unprofitable operations in Norway and a reduction in the share of hardware sales within Rejlers Embriq.
Rejlers Embriq has continued to develop strongly. The business is changing, as evidenced by a declining share of hardware sales linked to the final stages of the successful roll-out of 180,000 smart electricity meters for Netalliansen in Norway. Hardware sales will be partly replaced by service contracts offering regular income and higher profitability. We are optimistic about the future of Embriq with its modern digital analytics range.
Some personal reflections
It is with much pleasure, energy and enthusiasm that I, together with all our managers and colleagues, have started this sweeping journey of change to take Rejlers forward into the future. Our watchwords for value-adding change are leadership, business acumen and brand development. The change process primarily revolves around organisation, structure and culture, and it is culture that takes time.
Stockholm, October 2018