INTERIM REPORT Q1 − 3 MONTHS
1 JANUARY-31 MARCH 2024
FIRST QUARTER (1 JAN-31 MAR 2024)
- Net sales increased by 5 percent to MSEK 1,576 (1,505). Currency-adjusted sales increased by 5 percent during the quarter.
- Operating profit before depreciation and amortisation (EBITDA) increased by 62 percent to MSEK 223 (138).
- Operating profit increased by 130 percent to MSEK 161 (70), correspond- ing to an operating margin of 10.2 percent (4.7).
- Profit after financial items increased by 147 percent to MSEK 141 (57).
- Profit after tax amounted to MSEK 103 (41).
- Earnings per share before dilution increased by 207 percent to SEK 0.46 (0.15). Earnings per share after dilution totalled SEK 0.46 (0.15). 1)
- Cash flow from operating activities amounted to MSEK 64 (-8).
- The equity/assets ratio at the end of the quarter was 56 percent (53). 1)
- Net debt excluding lease liabilities amounted to MSEK 96 (490).
EVENTS DURING THE REPORTING PERIOD
- ITAB commenced delivery of 7,200 self-checkouts to the stores of a lead- ing grocery chain in multiple countries in Europe during January. Comple- tion of the deliveries is expected to take place in February 2025, and the total value of the contract is estimated at approximately MEUR 16 in 2024.
- In January, ITAB signed an agreement with a leading fashion chain in Eu- rope for the delivery of customised interiors, checkouts and fitting rooms for the refurbishment of existing stores and in upcoming new stores over three years. The total value of the contract is estimated at approximately MEUR 16.
- ITAB's share buyback program for a maximum amount of MSEK 50, which was introduced in September 2023, was completed in late March 2024 when the maximum amount for share repurchases was reached. A total of 3,079,659 ordinary shares were repurchased within the framework of the program.
- In early April, ITAB signed an agreement with a leading grocery chain for the delivery of entrance and exit gates, aimed at improving loss-preven- tion measures in their stores across Europe. The total value of the contract is estimated at at least MEUR 8 over three years.
Q1
2024 BEGINS WITH HISTORICALLY STRONG EARNINGS
"ITAB started 2024 with a strong quarter in terms of earnings, despite the unchanged economic climate. The stabilisation in demand that we noted in the autumn has continued, and our gross margin has improved. The operating margin for the quarter was the highest to date for the January-March period in any year in ITAB's history, which is a confirmation that our long-term plan works. Over the next two to three years, our focus will be on finishing the final part of our strategy to transform and modernise ITAB in combination with increased focus on expansion and consolidation of the market."
Andréas Elgaard | |
President & CEO | Read more on page 2. |
DISCONTINUED OPERATIONS
In March 2022, ITAB decided to discontinue its operations in Russia due to the Russian regime's invasion of Ukraine. For this reason, the Russian subsidiary has been recognised as Discontinued Operations in accordance with IFRS 5 as of ITAB's interim report for the third quarter of 2022. The discontinuation of the Russian operations was completed on 27 March 2024 through the divestment of all shares in the Russian subsidiary. For more information, see Note 8 Discontinued Operations on page 12. Comments and figures in this report pertain to Continuing Operations, unless otherwise stated.
THE GROUP IN SUMMARY
For definitions, see pages 15-18.
FIRST QUARTER | FULL YEAR | |||||
Jan−Mar | Jan−Mar | Rolling 12 months, | Jan−Dec | |||
2024 | 2023 | Δ | as of 31 Mar 2024 | 2023 | Δ | |
Net sales, MSEK | 1,576 | 1,505 | +5% | 6,210 | 6,139 | +1% |
EBITDA, MSEK | 223 | 138 | +62% | 771 | 686 | +12% |
EBITDA margin, % | 14.2 | 9.2 | 12.4 | 11.2 | ||
Operating profit, MSEK | 161 | 70 | +130% | 523 | 432 | +21% |
Operating margin, % | 10.2 | 4.7 | 8.4 | 7.0 | ||
Profit after financial items, MSEK | 141 | 57 | +147% | 469 | 385 | +22% |
Profit margin, % | 8.9 | 3.8 | 7.5 | 6.3 | ||
Profit after tax, MSEK | 103 | 41 | +151% | 354 | 292 | +21% |
Earnings per share before dilution 1), SEK | 0.46 | 0.15 | +207% | 1.55 | 1.24 | +25% |
Cash flow from operating activities, MSEK | 64 | -8 | N/A | 882 | 810 | +9% |
Equity/assets ratio 1), % | 56 | 53 | 56 | 56 | ||
Interest-bearing net debt excl. lease liabilities, MSEK | 96 | 490 | -394 | 96 | 45 | +51 |
1) Including Discontinued Operations.
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 1
PRESIDENT'S COMMENTS
2024 BEGINS WITH
HISTORICALLY STRONG EARNINGS
ITAB started 2024 with a strong quarter in terms of earnings, despite the unchanged economic climate. The stabilisation in demand that we noted in the autumn has continued in several of our solution areas and geographic markets, which resulted in a good gross margin thanks to our favourable customer and product mix. This quarter, we reported our highest operating margin to date for the January-March period in any year in ITAB's history, which is a confirmation that our long-term plan works. Over the next two to three years, our focus will be on finishing the final part of our strategy to transform and modernise ITAB in combination with increased focus on expansion and consolidation of the market.
Confirmation that our strategy is working, and we now increase our focus on growth and expansion
ITAB'S UNIQUE SOLUTIONS STRENGTHEN THE GROUP'S MARKET POSITION
Several of ITAB's solution areas and geographic markets reported increased sales during the first quarter of the year, despite the negative economic effects that characterised the previous year not having improved to any major extent during the start of 2024. We believe, however, that the macroeconomic effects have stabilised and that the uncertainty around the future development in the market has decreased. Consequently, we continue to see signs of an increased willingness to invest among our customers. Retailers are devoting significant focus to loss-prevention measures, but as we have demonstrated in a couple of the customer contracts that we announced earlier in the spring, demand for our solutions that increase efficiency and reduce costs has also increased, particularly in the grocery sector. In total, currency-adjusted sales for the Group increased by 5 percent during the quarter compared with the preceding year.
INCREASED SALES OF CUSTOMISED STORE SOLUTIONS CONTRIBUTE TO POSITIVE EARNINGS PERFORMANCE The increased share of sales of our technical solutions, including "smart gates", continues to make a positive contribution to the development of both our gross
margin and our operating margin. We can also note that increased sales of self-checkouts and other solutions for self-service in stores, as well as a recovery in demand for customised shop fittings, continue to contribute to a favourable, but also more balanced, product mix for the quarter. In combination with a slight increase in sales, we can thus report our highest operating margin to date for the first quarter in any year at 10.2 percent. Operating profit amounted to MSEK 161
- and profit after financial items was MSEK 141 (57). Cash flow from operating activities for the quarter
of MSEK 64 (-8) was impacted by the positive performance of the gross margin and operating profit, while the increased sales also resulted in higher levels of inventory, accounts receivable and accounts payable. We continue to devote significant focus to capital efficiency, and we are continually taking measures to reduce our working capital requirements even with further increases in sales.
FINAL PART OF OUR STRATEGY - OPERATIONAL EFFICIENCY AND EXPANSION
ITAB's aim is for our solutions to improve operational efficiency, reduce costs and increase competitiveness in the retail sector, which has strengthened our market position in the recent years despite the weaker econo-
my. This is confirmed by the major customer agreements we signed at the start of the year, with the latest contract announced in April providing a clear example of how our solutions often encompass both products, services and software for installation in a large number of stores in many different countries. As our solutions achieve the desired results for our customers, opportunities often arise for add-on sales to further strengthen the efficiency and profitability of the stores.
Thanks to the dedicated efforts of the colleagues
at ITAB, we have been able to report a strong earnings performance for three consecutive quarters despite challenging market conditions and lower overall demand. We see this as clear confirmation that our strategy is working and that our teams know what they need to focus on. Even though our operations are characterised by natural seasonal variations in both sales and earnings performance, the underlying hope for the full-year 2024 is positive. Over the next two to three years, our focus will be on the final part of our strategy, with continued dedicated efforts to improve our own operational efficiency and a transition towards becoming the leading solution provider within the retail sector. The modernisation of our operations is continuing as planned through investments in shared values, capabilities, ways of working and modern op-
erational support systems with the aim of making ITAB more scalable and flexible in a dynamic world. At the same time, the current market situation and our strong financial position are providing us with the opportunity for further growth through strategic acquisitions in order to increase our pace of expansion and actively participate in the ongoing consolidation of the market, which will be crucial over the longer term.
Jönköping, May 2024
Andréas Elgaard
President & CEO
ITAB Shop Concept AB
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 2
DEVELOPMENT IN 2024
JANUARY-MARCH
NET SALES
First quarter
The Group's net sales increased by 5 percent to MSEK 1,576 (1,505) in the first quarter of the year. Currency-adjusted sales increased by 5 percent compared to the preceding year.
The sales performance in the beginning of 2024 was positive in several of ITAB's solution areas and geographic markets, with multiple new contracts signed with both existing and new customers. This is a positive sign that the uncertainty concerning future economic conditions that characterised large parts of the retail market in Europe in 2023, with high inflation and rising interest rates, has continued to gradually decrease since the autumn. Interest in the Group's technical and digital solutions for loss-prevention measures remained significant. During this quarter, demand for self-checkouts and other self-service solutions for increased efficiency and reduced costs in stores also developed positively. This included the start of delivery of 7,200 self-checkouts to the stores of a leading grocery chain in multiple countries in Europe during January. The estimated total value for this contract for the year is approximately MEUR 16. Sales of customised shop fittings for new and updated consumer experiences also recovered somewhat during the quarter. In January, for example, an agreement was signed with a leading fashion chain in Europe for the delivery of customised interiors, checkouts and fitting rooms for both the refurbishment of existing stores and in upcoming new stores. The total value of the contract is estimated at MEUR 16 over three years.
Northern Europe and UK & Ireland delivered the strongest sales performance for the quarter, with a sales increase of over 20 percent, and Eastern Europe also performed well. Sales in Southern Europe and countries outside Europe decreased in relation to strong comparative figures for the quarter in the preceding year. Of the Group's customer groups, sales to Grocery increased during the quarter while sales in Home Improvements, Fashion and Other customer groups remained largely unchanged compared to the preceding year.
Sales per customer group and geographic area are shown in Note 3 on page 10.
EARNINGS
First quarter
Operating profit for the first quarter increased by 130 percent to MSEK 161 (70), corresponding to an operating margin of 10.2 percent (4.7).
The increased sales in combination with a gross margin that remained strong had a positive impact on earnings performance for the quarter. The favourable product and customer mix, with an increased share in sales of ITAB's technical solutions in both loss-prevention measures and self-service in stores, continued to have a positive impact on the gross margin. Increased sales of customised shop fittings also had a positive impact on earnings. Implemented price increases were largely able to compensate for the cost increases in the preceding year. Continued measures for increased efficiency and cost adjustments, as well as slight improvements to capacity utilisation at the Group's production facilities, yielded positive effects during the quarter.
Profit after financial items increased by 147 percent to MSEK 141 (57) and profit after tax by 151 percent to MSEK 103 (41). Earnings per share before and after dilution totalled SEK 0.46 (0.15).
NET SALES (MSEK)
Per quarter | Rolling four quarters | |||||||||||
2000 | 8000 | |||||||||||
1500 | 6000 | |||||||||||
1000 | 4000 | |||||||||||
500 | 2000 | |||||||||||
0 | 0 | |||||||||||
Q1/21 | Q2/21 | Q3/21 | Q4/21 | Q1/22 | Q2/22 | Q3/22 | Q4/22 | Q1/23 | Q2/23 | Q3/23 | Q4/23 | Q1/24 |
Net sales per quarter (left-hand scale)
Net sales, rolling four quarters (right-hand scale)
OPERATING PROFIT AND OPERATING MARGIN 1) (adjusted for non-recurring items)
Operating profit | Operating margin |
per quarter, MSEK | rolling four quarters, % |
180 | 12 |
150 | 10 |
120 | 8 |
90 | 6 |
60 | 4 |
SALES BY CUSTOMER GROUP
70 | |||
60 | |||
50 | |||
40 | |||
30 | |||
20 | |||
10 | |||
0 | |||
Grocery | Home | Fashion | Other customer |
Improvements | groups |
Rolling 12 months 2024
Full year 2023
30 | 2 | ||||||||||||||||||||||||
0 | 0 | ||||||||||||||||||||||||
Q1/21 | Q2/21 | Q3/21 | Q4/21 | Q1/22 | Q2/22 | Q3/22 | Q4/22 | Q1/23 | Q2/23 | Q3/23 | Q4/23 | Q1/24 |
Operating profit per quarter (left-hand scale)
Operating margin, rolling four quarters (right-hand scale)
- Non-recurringitems in 2021-2022 consisted mainly of costs relating to transformation work under ITAB's One ITAB strategy.
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 3
CASH FLOW FROM OPERATING ACTIVITIES 1) (MSEK)
Per quarter | Rolling four quarters | |||||||||||
600 | 1,200 | |||||||||||
500 | 1,000 | |||||||||||
400 | 800 | |||||||||||
300 | 600 | |||||||||||
200 | 400 | |||||||||||
100 | 200 | |||||||||||
0 | 0 | |||||||||||
-100 | -200 | |||||||||||
-200 | -400 | |||||||||||
Q1/21 | Q2/21 | Q3/21 | Q4/21 | Q1/22 | Q2/22 | Q3/22 | Q4/22 | Q1/23 | Q2/23 | Q3/23 | Q4/23 | Q1/24 |
Cash flow from operating activities per quarter (left-hand scale)
Cash flow from operating activities, rolling four quarters (right-hand scale)
NET DEBT 1) (MSEK) (excluding lease liabilities)
1,500
1,000
500
0
Q1/21 | Q2/21 | Q3/21 | Q4/21 | Q1/22 | Q2/22 | Q3/22 | Q4/22 | Q1/23 | Q2/23 | Q3/23 | Q4/23 | Q1/24 |
Net debt per quarter
- Comparative periods in 2021 and 2022 have not been restated with regard to
Discontinued Operations.
CASH FLOW, FINANCING AND LIQUIDITY
Cash flow from operating activities for the first quarter amounted to MSEK 64 (-8). The strong gross margin and measures taken to reduce the Group's working capital requirement continued to contribute to the growth in cash flow. At the same time, the Group's increased sales during the quarter resulted in higher levels of inventory and accounts receivable, which adversely affected cash flow from operating activities. Cash flow was also negatively impacted in an amount of MSEK -9(-72) pertaining to paid tax liabilities. The Group's operations continued to devote considerable focus to capital efficiency and are continually taking measures to reduce their working capital requirements even with further increases in sales.
Net debt excluding lease liabilities amounted to MSEK 96 (490) at the end of the quarter. Net debt including lease liabilities amounted to MSEK 635 (1,138).
The Group's cash and cash equivalents, including granted unutilised credits, amounted to MSEK 1,781 (1,355) on the balance sheet date, 31 March 2024. The equity/assets ratio was 56 percent (53).
INVESTMENTS
The Group's net investments/divestments during the first quarter amounted to MSEK 23 (18), of which MSEK 0 (6) is attributable to corporate acquisi- tions/divestments. ITAB's current investments include shared operational support systems for the Group, which corresponded to approximately 46 percent of total investments during the quarter. For more information on corporate acquisitions and divestments, refer to Note 2 on page 10.
EMPLOYEES
The average number of employees for the first quarter was 2,495 (2,590).
PARENT COMPANY
The Parent Company ITAB Shop Concept AB's operations mainly consist of Group-wide functions. The Parent Company's net sales pertain to revenue from subsidiaries and amounted to MSEK 47 (32) for the first quarter of 2024. Profit after financial items totalled MSEK -13(-36) for the quarter. Earnings include dividends from subsidiaries of MSEK 6 (0).
CORPORATE ACQUISITIONS, DIVESTMENTS AND DISCONTINUED OPERATIONS
To date, the ITAB Group has not completed any new acquisitions in 2024. Refer also to Note 2 on page 10.
Discontinuation of operations in Russia
In March 2022, ITAB decided to discontinue its operations in Russia due to the Russian regime's invasion of Ukraine. For this reason, the Russian subsidiary has been recognised as Discontinued Operations in accordance with IFRS 5 as of ITAB's interim report for the third quarter of 2022. The discontinuation of the operations was completed on 27 March 2024 through the divestment of all shares in the Russian subsidiary. For more information, see Note 8 Discontinued Operations on page 12.
OTHER INFORMATION
REPURCHASES OF OWN SHARES
On 28 September 2023, ITAB initiated a share buyback program with a maximum purchase amount of MSEK 50. The buyback program was completed on 22 March 2024 when the maximum amount for share repurchases was reached. A total of 3,079,659 ordinary shares were repurchased within the framework of the program. Refer also to Note 5 Repurchases of own shares on page 11.
RISKS AND UNCERTAINTIES
The Group's significant risks and uncertainties include strategic
risks, operational risks, financial risks, compliance and regulatory risks, and sustainability risks. For a more detailed account of the Group's significant risks and risk management, refer to pages 29-33 in ITAB's Annual Report for 2023. The Group's key financial risks are also described in more detail in Note 4 on pages 55-56 in the Annual Report, and the sustainability risks on pages 89-90. The risks that are most prominent from a short-term perspective are the impact of inflation and the economic climate on customers and suppliers and the continued impact of the changed global geopolitical conditions, with potential supply chain disruptions and continued high prices for raw materials and energy.
ESTIMATES AND ASSESSMENTS
The preparation of this interim report requires management to make assessments and estimates as well as assumptions that affect the application of the accounting policies and the reported amounts of assets, liabilities, revenue and expenses. The actual outcome may deviate from these estimates and judgements. Critical assessments and sources of uncertainty in estimates when preparing this interim report are the same as in the most recent Annual Report.
TRANSACTIONS WITH RELATED PARTIES
There have been no transactions between ITAB Shop Concept and related parties that have significantly affected the company's position and results during the reporting period.
EVENTS AFTER THE END OF THE REPORTING PERIOD
On 2 May 2024, ITAB's Italian subsidiary La Fortezza S.p.A. exercised its right to acquire the minority holding of 19 percent of the shares in its subsidiary Imola Retail Solution S.r.l. in accordance with the original acquisition agreement from October 2020. The purchase consideration for the outstanding minority holding amounted to approximately MEUR 1. Imola Retail Solution subsequently became a wholly owned subsidiary in the ITAB Group.
No other significant events have taken place after the end of the reporting period.
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 4
THE GROUP IN SUMMARY
INCOME STATEMENT - GROUP
(MSEK) | 3 MONTHS | 3 MONTHS | ROLLING 12 MONTHS | FULL YEAR | |
Note | Jan-Mar 2024 | Jan-Mar 2023 | as of 31 Mar 2024 | Jan-Dec 2023 | |
Revenue from contracts with customers | 3 | 1,576 | 1,505 | 6,210 | 6,139 |
Costs of goods sold | -1,100 | -1,106 | -4,414 | -4,420 | |
GROSS PROFIT | 476 | 399 | 1,796 | 1,719 | |
Selling expenses | -235 | -243 | -927 | -935 | |
Administrative expenses | -84 | -82 | -329 | -327 | |
Other operating income and expenses | 4 | -4 | -17 | -25 | |
OPERATING PROFIT | 161 | 70 | 523 | 432 | |
Financial income | 9 | 10 | 33 | 34 | |
Financial expenses | 4 | -29 | -23 | -87 | -81 |
PROFIT AFTER FINANCIAL ITEMS | 141 | 57 | 469 | 385 | |
Tax expenses | -38 | -16 | -115 | -93 | |
NET PROFIT FOR THE PERIOD - CONTINUING OPERATIONS | 103 | 41 | 354 | 292 | |
Discontinued Operations - ITAB Rus JSC | |||||
Profit from Discontinued Operations, net after tax | 8 | 1 | -7 | -4 | -12 |
NET PROFIT FOR THE PERIOD | 104 | 34 | 350 | 280 | |
Net profit for the period attributable to: | |||||
Parent Company shareholders | 100 | 33 | 337 | 270 | |
Non-controlling interests | 4 | 1 | 13 | 10 | |
Depreciation and amortisation for the period amount to | 62 | 68 | 248 | 254 | |
Tax expenses for the period account for | 27% | 28% | 24% | 24% | |
Earnings per share incl. Discontinued Operations before dilution, SEK | 0.46 | 0.15 | 1.55 | 1.24 | |
Earnings per share incl. Discontinued Operations after dilution, SEK | 5.6 | 0.46 | 0.15 | 1.54 | 1.23 |
Earnings per share excl. Discontinued Operations before dilution, SEK | 0.46 | 0.18 | 1.56 | 1.29 | |
Average number of ordinary shares outstanding, thousands | 5, 6 | 216,471 | 218,100 | 217,556 | 218,015 |
Average number of ordinary shares outstanding after dilution, thousands | 5, 6 | 217,732 | 219,558 | 218,816 | 219,275 |
Number of ordinary shares outstanding, thousands | 5, 6 | 215,021 | 218,100 | 215,021 | 217,558 |
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 5
STATEMENT OF OTHER COMPREHENSIVE INCOME - GROUP
(MSEK) | Note | 3 MONTHS | 3 MONTHS | ROLLING 12 MONTHS | FULL YEAR |
Jan-Mar 2024 | Jan-Mar 2023 | as of 31 Mar 2024 | Jan-Dec 2023 | ||
NET PROFIT FOR THE PERIOD | 104 | 34 | 350 | 280 | |
OTHER COMPREHENSIVE INCOME | |||||
Items that will not be reclassified to the income statement | |||||
Revaluation of defined-benefit pension commitments | − | − | 0 | 0 | |
Tax relating to items not to be reclassified | − | − | 0 | 0 | |
− | − | 0 | 0 | ||
Items that may be reclassified to the income statement | |||||
Translation differences | 1 | 125 | 11 | -31 | -145 |
Hedging of net investments, net | 4 | -7 | 3 | 17 | 27 |
Cash flow hedges, net | 4 | -3 | -1 | -9 | -7 |
Tax on items that may be reclassified | 2 | 0 | -2 | -4 | |
117 | 13 | -25 | -129 | ||
Total other comprehensive income after tax | 117 | 13 | -25 | -129 | |
COMPREHENSIVE INCOME FOR THE PERIOD | 221 | 47 | 325 | 151 | |
Comprehensive income for the period attributable to: | |||||
Parent Company shareholders | 209 | 46 | 312 | 149 | |
Non-controlling interests | 12 | 1 | 13 | 2 |
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 6
STATEMENT OF FINANCIAL POSITION - GROUP
(MSEK) | Note | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
ASSETS | ||||
Non-current assets | ||||
Intangible assets | ||||
Goodwill | 1,849 | 1,814 | 1,786 | |
Other intangible assets | 147 | 108 | 133 | |
1,996 | 1,922 | 1,919 | ||
Property, plant and equipment | 1,216 | 1,361 | 1,222 | |
Participations in associated companies | - | 9 | - | |
Deferred tax assets | 80 | 105 | 78 | |
Financial non-current receivables | 99 | 38 | 79 | |
Total non-current assets | 3,391 | 3,435 | 3,298 | |
Current assets | ||||
Inventories | 864 | 1,040 | 793 | |
Current receivables | 1,310 | 1,213 | 1,033 | |
Cash and cash equivalents | 472 | 338 | 578 | |
Total current assets | 2,646 | 2,591 | 2,404 | |
Assets held for sale | 8 | - | 85 | 66 |
TOTAL ASSETS | 6,037 | 6,111 | 5,768 |
(MSEK) | Note | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
EQUITY AND LIABILITIES | ||||
Equity attributable to Parent Company shareholders | 5 | 3,214 | 3,059 | 3,049 |
Non-controlling interests | 171 | 158 | 159 | |
Deferred tax liabilities | 40 | 44 | 39 | |
Other non-current liabilities | 4 | 1,037 | 1,277 | 1,057 |
Current liabilities | 4 | 1,575 | 1,547 | 1,447 |
Liabilities attributable to assets held for sale | 8 | - | 26 | 17 |
TOTAL EQUITY AND LIABILITIES | 6,037 | 6,111 | 5,768 | |
Interest-bearing net debt | 635 | 1,138 | 591 | |
Interest-bearing net debt excl. lease liabilities | 96 | 490 | 45 |
STATEMENT OF CHANGES IN EQUITY - GROUP
(MSEK) | Repurchased | Other contributed | Profit brought | Attributable to Parent | Attributable to | |||
Note Share capital | own shares | capital | Other reserves 1) | forward | Company shareholders | non-controlling interests | Total equity | |
EQUITY AS OF 1 JANUARY 2023 | 93 | -2 | 1,091 | 224 | 1,606 | 3,012 | 157 | 3,169 |
Net profit for the period | 32 | 32 | 1 | 33 | ||||
Other comprehensive income | 13 | 13 | 13 | |||||
Comprehensive income January−March 2023 | 13 | 32 | 45 | 1 | 46 | |||
Share incentive program | 6 | 1 | 1 | 1 | ||||
EQUITY AS OF 31 MARCH 2023 | 93 | -2 | 1,092 | 237 | 1,638 | 3,058 | 158 | 3,216 |
Net profit for the period | 238 | 238 | 9 | 247 | ||||
Other comprehensive income | -134 | -134 | -8 | -142 | ||||
Comprehensive income April−December 2023 | -134 | 238 | 104 | 1 | 105 | |||
Dividends | -109 | -109 | -109 | |||||
Share incentive program | 6 | 1 | 1 | 1 | ||||
Repurchase of own ordinary shares | 5 | -5 | -5 | -5 | ||||
EQUITY AS OF 31 DECEMBER 2023 | 93 | -7 | 1,093 | 103 | 1,767 | 3,049 | 159 | 3,208 |
Net profit for the period | 100 | 100 | 4 | 104 | ||||
Other comprehensive income | 109 | 109 | 8 | 117 | ||||
Comprehensive income January-March 2024 | 109 | 100 | 209 | 12 | 221 | |||
Share incentive program | 6 | 1 | 1 | 1 | ||||
Repurchase of own ordinary shares | 5 | -45 | -45 | -45 | ||||
EQUITY AS OF 31 MARCH 2024 | 93 | -52 | 1,094 | 212 | 1,867 | 3,214 | 171 | 3,385 |
- Other reserves consist of translation reserve and hedging reserve.
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 7
STATEMENT OF CASH FLOWS - GROUP
(MSEK) | 3 MONTHS | 3 MONTHS | ROLLING 12 MONTHS | FULL YEAR | |
Note | Jan-Mar 2024 | Jan-Mar 2023 | as of 31 Mar 2024 | Jan-Dec 2023 | |
Operating profit | 161 | 70 | 523 | 432 | |
Interest paid and received, tax and adjustments for items not included in the cash flow | 80 | -10 | 181 | 91 | |
Cash flow from operating activities before change in working capital | 241 | 60 | 704 | 523 | |
Change in working capital | |||||
Change in inventories | -55 | 0 | 126 | 181 | |
Change in operating receivables | -229 | 17 | -45 | 201 | |
Change in operating liabilities | 107 | -85 | 97 | -95 | |
Cash flow from change in working capital | -177 | -68 | 178 | 287 | |
CASH FLOW FROM OPERATING ACTIVITIES | 64 | -8 | 882 | 810 | |
Investing activities | |||||
Acquisition/divestment of companies and operations | 2 | 0 | -6 | 15 | 9 |
Other net investments | -23 | -12 | -127 | -116 | |
Cash flow from investing activities | -23 | -18 | -112 | -107 | |
CASH FLOW AFTER INVESTING ACTIVITIES | 41 | -26 | 770 | 703 | |
Financing activities | |||||
Dividends to shareholders | - | - | -109 | -109 | |
Repurchase of ordinary shares | -45 | - | -50 | -5 | |
Repayment of lease liabilities | -32 | -38 | -125 | -131 | |
Cash flow from other financing activities | -94 | -346 | -313 | -565 | |
Cash flow from financing activities | -171 | -384 | -597 | -810 | |
CASH FLOW FOR THE PERIOD | -130 | -410 | 173 | -107 | |
Cash and cash equivalents at the start of the period | 578 | 756 | 338 | 756 | |
Translation differences on cash and cash equivalents | 24 | -8 | -39 | -71 | |
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD | 472 | 338 | 472 | 578 | |
Cash flow from operating activities per share, SEK | 0.29 | -0.04 | 4.06 | 3.73 |
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 8
THE PARENT COMPANY IN SUMMARY
INCOME STATEMENT - PARENT COMPANY
(MSEK) | 3 MONTHS | 3 MONTHS | FULL YEAR | |
Note | Jan-Mar 2024 | Jan-Mar 2023 | Jan-Dec 2023 | |
Net sales 1) | 47 | 32 | 184 | |
Costs of goods sold | -6 | -7 | -31 | |
GROSS PROFIT | 41 | 25 | 153 | |
Selling expenses | -13 | -27 | -81 | |
Administrative expenses | -13 | -19 | -78 | |
Other operating income and expenses | 2 | 0 | -17 | |
OPERATING PROFIT | 17 | -21 | -23 | |
Profit from participations in Group | ||||
companies | 6 | 0 | -5 | |
Financial income and expenses | 4 | -36 | -15 | -41 |
PROFIT AFTER FINANCIAL ITEMS | -13 | -36 | -69 | |
Year-end appropriations | - | - | 125 | |
PROFIT BEFORE TAX | -13 | -36 | 56 | |
Tax expenses for the period | 1 | 1 | -15 | |
NET PROFIT FOR THE PERIOD | -12 | -35 | 41 |
- Pertains to revenue from subsidiaries.
STATEMENT OF OTHER COMPREHENSIVE INCOME - PARENT COMPANY
(MSEK) | 3 MONTHS | 3 MONTHS | FULL YEAR | |
Note | Jan-Mar 2024 | Jan-Mar 2023 | Jan-Dec 2023 | |
Net profit for the period | -12 | -35 | 41 | |
Other comprehensive income | - | - | - | |
COMPREHENSIVE INCOME | ||||
FOR THE PERIOD | -12 | -35 | 41 |
BALANCE SHEET - PARENT COMPANY
(MSEK) | Note | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
ASSETS | ||||
Non-current assets | ||||
Property, plant and equipment | 4 | 1 | 4 | |
Financial assets | 2,047 | 2,065 | 2,047 | |
Deferred tax assets | 18 | 33 | 18 | |
Total non-current assets | 2,069 | 2,099 | 2,069 | |
Current assets | ||||
Current receivables | 219 | 475 | 360 | |
Cash and bank balance | 178 | 26 | 292 | |
Total current assets | 397 | 501 | 652 | |
TOTAL ASSETS | 2,466 | 2,600 | 2,721 | |
EQUITY AND LIABILITIES | ||||
Equity | ||||
Restricted equity | 100 | 100 | 100 | |
Non-restricted equity | 1,534 | 1,628 | 1,590 | |
Total equity | 5, 6 | 1,634 | 1,728 | 1,690 |
Non-current liabilities | 574 | 713 | 590 | |
Current liabilities | 258 | 159 | 441 | |
TOTAL EQUITY AND LIABILITIES | 2,466 | 2,600 | 2,721 |
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 9
NOTES
NOTE 1 ACCOUNTING POLICIES
ITAB applies International Financial Reporting Standards (IFRS). This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting, relevant sections of the Swedish Annual Accounts Act, and the Swedish Financial Reporting Board's recommendation RFR 1 Supplementary Accounting Rules for Groups and RFR 2 Accounting for Legal Entities. The accounting policies applied correspond with the accounting policies used in the preparation of the most recent Annual Report.
IAS 29 Financial Reporting in Hyperinflationary Economies
Argentina's economy is considered to have been in a state of hyperinflation since 1 July 2018. Following the devaluation of the Argentinian peso in autumn 2023, the financial statements for ITAB's subsidiary in Argentina were adjusted in 2023 to correct for the effects of inflation in accordance with IAS 29 Financial Reporting in Hyperinflationary Economies. Refer to Note 35 in ITAB's Annual Report for 2023 for further information.
The adjustment for inflation was made in accordance with the Argentin- ian consumer price index (National CPI). The base consumer price index at 31 March 2024 was 5,357.1. The consumer price adjustment index at 31 December 2023 was 3,533.2. To hedge monetary assets against inflation, long-term investments have been made in an amount corresponding to MSEK 66. These are recognised at fair value through net financial items in the income statement.
NOTE 2 CORPORATE ACQUISITIONS AND DIVESTMENTS
ACQUISITIONS AND DIVESTMENTS IN 2024
The ITAB Group has not completed any new acquisitions to date in 2024. The Group's Russian subsidiary, ITAB Rus JSC, has been recognised as
Discontinued Operations in accordance with IFRS 5 since ITAB's interim report for the third quarter of 2022. The discontinuation of the operations was completed on 27 March 2024 through the divestment of all shares in the subsidiary. For more information, see Note 8 Discontinued Operations on page 12.
NOTE 3 REVENUE FROM CONTRACTS WITH CUSTOMERS BY CUSTOMER GROUP AND GEOGRAPHIC AREA
Revenue recognition takes place when the Group satisfies a performance | The largest customer accounts for 10 percent of external sales, and none | |||
obligation by transferring promised goods and the customer gains control | of the ITAB Group's other customers account for more than 5 percent of | |||
of the asset. This normally takes place on delivery in accordance with | external sales. | |||
applicable delivery terms. In the case of concept sales where a service | ||||
assignment is included, revenue recognition for the projects takes place | ||||
over time. The projects are primarily short-term projects. | ||||
SALES BY CUSTOMER GROUP 1) | 3 MONTHS | 3 MONTHS | ROLLING 12 MONTHS | FULL YEAR |
Jan-Mar 2024 | Jan-Mar 2023 | as of 31 Mar 2024 | Jan-Dec 2023 | |
Grocery | 888 | 809 | 3,305 | 3,226 |
Home Improvements | 210 | 208 | 771 | 769 |
Fashion | 143 | 149 | 583 | 589 |
Other customer groups | 335 | 339 | 1,551 | 1,555 |
TOTAL | 1,576 | 1,505 | 6,210 | 6,139 |
- The customer groups are divided according to the industries in which the customers operate. Other customer groups largely consist of distributors, consumer electronics, pharmacies and health/beauty.
SALES BY GEOGRAPHIC AREA 2) | 3 MONTHS | 3 MONTHS | ROLLING 12 MONTHS | FULL YEAR |
Jan-Mar 2024 | Jan-Mar 2023 | as of 31 Mar 2024 | Jan-Dec 2023 | |
Northern Europe | 496 | 409 | 1,595 | 1,508 |
Southern Europe | 314 | 342 | 1,380 | 1,408 |
Central Europe | 292 | 293 | 1,168 | 1,169 |
UK & Ireland | 183 | 151 | 712 | 680 |
Eastern Europe | 124 | 113 | 486 | 475 |
Rest of the World | 167 | 197 | 869 | 899 |
TOTAL | 1,576 | 1,505 | 6,210 | 6,139 |
- Northern Europe consists of the Nordic countries. Southern Europe consists mainly of Italy, France and Spain. Central Europe's largest markets are Germany, the Netherlands and Czechia. Eastern Europe's largest markets are the Baltic countries, Poland, Romania and Slovakia. Rest of the World comprises all countries outside Europe, with the US, Australia, China and Argentina accounting for over 50 percent of sales.
NOTE 4 FINANCIAL ASSETS AND LIABILITIES
ACQUISITIONS AND DIVESTMENTS IN 2023
The ITAB Group did not complete any new acquisitions in 2023. During the second quarter, ITAB Shop Concept AB's 21-percent shareholding in the associated company OmboriGrid AB (Priv) was divested. The purchase consideration for the shares divested amounted to MSEK 15, which impacted cash flow in the second quarter. Cash flow was also impacted in an amount of MSEK -6 by partial payments of acquisitions from 2021.
ITAB has derivative instruments measured at fair value. The derivative instruments consist of currency futures and interest rate swaps and are used for hedging purposes. These derivative instruments are classified in level 2 in accordance with IFRS 13 and fair value is calculated through discounted future cash flows according to the terms of the contracts and maturity dates, with all variables, such as discount rates and exchange rates, taken from market quotations for calculations.
The fair value of the derivative instruments for hedging purposes is recognised as a change in other comprehensive income. Any ineffectiveness is recognised immediately in net financial items in the income statement.
From the third quarter of 2023, ITAB also holds bonds not used for hedging purposes. These are measured at fair value and the change is recognised in net financial items in the income statement.
In the first quarter of 2024, a reduction of MSEK 1 in financial expenses was recognised, pertaining to hedges that were deemed ineffective.
Carrying amount is considered to be a reasonable estimate of fair value for all financial assets and liabilities. No financial assets and liabilities have been moved between the valuation categories and the valuation techniques are unchanged during the year. For other information, refer to the latest Annual Report.
ITAB | INTERIM REPORT Q1 − JANUARY-MARCH 2024 10
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ITAB Shop Concept AB published this content on 14 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 May 2024 05:09:40 UTC.