Cardo: Interim Report, January - March 2001.Business Editors STOCKHOLM, Sweden--(BUSINESS WIRE)--May 4, 2001 -- Inflow of orders: SEK 2,900 million (2,357) -- Invoiced sales: SEK 2,375 million (2,214) -- Operating earnings: SEK 100 million (107) -- Earnings after financial items: SEK 76 million (83) -- Earnings per share: SEK 1.63 (1.80) The Group's inflow in·flow n. 1. The act or process of flowing in or into: an inflow of water; an inflow of information. 2. of orders amounted to SEK SEK In currencies, this is the abbreviation for the Swedish Krona. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 2,900 million (2,357) during the quarter, which is a rise of 15 percent for the current structure of the Group after adjustment for the effects of exchange rate movements. The rise is almost exclusively attributable to Cardo Rail, which has had a very good inflow of orders during the period. Invoiced sales amounted to SEK 2,375 million (2,214). Adjusted for the effects of exchange rate movements, this is a rise of 2 percent, which is mainly attributable to company acquisitions. Operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before amounted to SEK 100 million (107), providing an operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: of 4.2 percent (4.8). Cardo Door improved its earnings, while Cardo Pump's were slightly lower. Lower deliveries of completed orders compared with the corresponding period last year resulted in a reduction in Cardo Rail's earnings by SEK 8 million, which gave a slightly lower operating margin. For the year as a whole, Cardo Rail's operating margin is expected to be in line with the objective of 8-10 percent. Earnings after financial items were SEK 76 million (83), providing a profit margin of 3.2 percent (3.8). Earnings per share after full tax amounted to SEK 1.63 (1.80). Exchange rate movements are estimated to have had only a marginal impact on Group earnings. Return on capital employed Return on capital employed (ROCE) Indicator of profitability of the firm's capital investments. Determined by dividing Earnings Before Interest and Taxes by (capital employed plus short-term loans minus intangible assets). was 19.6 percent (19.1) for the twelve-month period ended March 31. Return on equity during the same period amounted to 18.9 percent (21.5). Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses after tax amounted to SEK 1.63 (7.60) per share. Adjusted for the effects of exchange rate movements on the change in working capital, cash flow after tax was SEK 4.16 (6.68) per share.
Invoiced sales and operating earnings by business area
Invoiced sales Operating earnings
Jan. - March Jan. - March Jan. - March Jan. -
March
MSEK 2001 2000 2001 2000
Door 1,131 1,021 53 47
Pump 611 571 31 37
Rail 633 622 35 43
Other items - - -19 -20
1) 2,375 2,214 100 107
1) Made up of the parent company, other central units and Group adjustments Cardo Door Cardo Door is one of the world's largest manufacturers of industrial doors and Europe's leading supplier of dock loading equipment. Cardo Door is also the market leader in the service of these products and one of Europe's largest manufacturers of residential garage doors. Cardo Door's invoiced sales rose during the period to SEK 1,131 million (1,021). Adjusted for the effects of exchange rate movements, this is a rise of 5 percent. Company acquisitions account for 4 percentage points of this figure. Operating earnings rose to SEK 53 million (47). Demand for industrial doors was slightly weaker than during the corresponding period last year. For dock loading equipment, demand was on a par with last year, as it also was for residential garage doors with the exception of Germany, where demand fell. The demand for service, which accounts for approximately a quarter of Cardo Door's turnover, remained good. As part of Cardo Door's efforts in markets in eastern Europe Eastern Europe The countries of eastern Europe, especially those that were allied with the USSR in the Warsaw Pact, which was established in 1955 and dissolved in 1991. , a new sales company was established in Hungary in the beginning of the year. An agreement was entered into with the international logistics The negotiating, planning, and implementation of supporting logistic arrangements between nations, their forces, and agencies. It includes furnishing logistic support (major end items, materiel, and/or services) to, or receiving logistic support from, one or more friendly foreign group Danzas to the effect that Danzas will gradually take over responsibility for all shipments from Cardo Door's production companies in Sweden, Denmark and the Netherlands. Up to now these shipments have been managed internally. In April, sales of a new generation of industrial doors were initiated. These doors have been developed to meet expected future EU standards for factors such as function and safety. Major orders during the first quarter included one from Capital International Airport in China for 24 industrial doors for vehicle garages in Beijing. KPC "Keeping parents clueless." See digispeak. Bygg A/S in Denmark ordered 116 complete dock loading systems for a freight terminal a terminal used for loading or unloading of freight. See also: Terminal , and a major service contract was signed with a chain of wholesalers in the Netherlands. In Finland, 17 industrial doors and 8 complete load houses, including service contracts, were sold to the parcel post parcel post, sending of packages through the mail service. At the congress of the Universal Postal Union in Paris in 1878, an international parcel-post system was established. terminal on the island of Aland, and the convenience goods company Ilmarisen Liikekiinteistot bought 13 dock loading units for a terminal in Espoo. Cardo Pump Cardo Pump is one of Europe's largest manufacturers of pumps, mixers and aerators and a global leader in the production of sophisticated measuring instruments for the pulp and paper industry The global pulp and paper industry is dominated by North American (United States, Canada), northern European (Finland, Sweden) and East Asian countries (such as Japan). Australasia and Latin America also have significant pulp and paper industries. . Invoiced sales amounted to SEK 611 million (571). The increase is almost exclusively attributable to the effects of exchange rate movements. Operating earnings amounted to SEK 31 million (37). Deliveries to Cardo Pump's biggest segment, water and wastewater, rose compared to the corresponding period last year, while deliveries to the pulp and paper industry decreased somewhat. Deliveries to the building services segment were on a par with last year, despite the weak German and US construction markets. In order to further increase customer orientation Customer orientation (CO) is the set of beliefs in sales that says that customer needs and satisfaction are the priority of an organization. It focuses on dynamic interactions between the organization and customers as well as competitors in the market and its internal stakeholders. , Cardo Pump's sales organization was altered at the turn of the year. Water and wastewater, industry and building services are now separate marketing organizations, creating even greater potential to focus on each customer group. During the period, a restructuring of the plant in Molndal was begun with a view to improving efficiency and profitability. At the end of March, negotiations were initiated under the Co-determination in the Workplace Act regarding reduction of the workforce by 35 people. Big contracts included a general agreement regarding service for Severn Trent Severn Trent plc (LSE: SVT) is a British utility. It is traded on the London Stock Exchange and is a constituent of the FTSE 100 Index. Severn Trent is a group of companies employing more than 15,000 people across the UK, US and mainland Europe. , which is one of the biggest water boards in the UK, with responsibility for water and wastewater treatment for more than 8 million people in the area around Birmingham. The agreement, which covers service, maintenance work and repairs at about 200 pumping stations, is estimated to be worth more than SEK 15 million. In the USA, an order was received for almost 100 process pumps for a new paper machine for the Willamette paper mill in Tennessee. These pumps will be delivered in 2001 and 2002. In Spain, an order worth approximately SEK 5 million was received for 8 big submersible pumps A submersible pump is a pump which has a hermetically sealed motor close-coupled to the pump body. The whole assembly is submerged in the fluid to be pumped. The advantage of this type of pump is that it can provide a significant lifting force as it does not rely on external air for a treatment plant outside Barcelona. Cardo Rail Cardo Rail is one of the world's largest manufacturers of brake systems and brake components for rail vehicles Rail vehicles are vehicles capable of rolling on rail tracks. This includes:
The inflow of orders during the period amounted to SEK 990 million, which is a rise of 53 percent adjusted for the effects of exchange rate movements. The biggest order was received from Siemens and relates to brake equipment for 225 locomotives for the Austrian national railway company. The order is worth SEK 120 million. Deliveries will begin in 2003, and the first locomotives will be commissioned in 2005. During the quarter, Cardo Rail achieved good successes in Germany, where a number of attractive orders were received. For example, two consortia, consisting of Alstom, Adtranz and Siemens, ordered brake equipment for a total of 181 commuter trains. The total value of the orders amounts to SEK 53 million and the end customer is Deutsche Bahn Deutsche Bahn AG (abbr. DB AG, DBAG or simply DB) is the successor of the former state railways of Germany: the Deutsche Bundesbahn of West Germany, the Deutsche Reichsbahn of the German Democratic Republic and the West Berlin VdeR. . The first deliveries are planned for June 2001 and the first trains will begin operating in 2003. Cardo Rail's collaboration with the world's largest manufacturer of bogies, the US company ABC ABC in full American Broadcasting Co. Major U.S. television network. It began when the expanding national radio network NBC split into the separate Red and Blue networks in 1928. NACO NACo National Association of Counties (Washington, DC, USA) NACO National AIDS Control Organisation (India) NACO National Aeronautical Charting Office (US FAA) , resulted in an order worth SEK 25 million during the quarter. The order relates to Cardo Rail's new "BFCB BFCB Big Foam Clue Bat (UserFriendly) for freight cars" concept, and the end customer is the British company Railtrack. The BFCB is a brake unit that was developed for fitting directly to the bogie bo·gie 1 also bo·gy n. pl. bo·gies 1. One of several wheels or supporting and aligning rollers inside the tread of a tractor or tank. 2. , which make it highly efficient, flexible and easy to install. Cardo Rail's invoiced sales amounted to SEK 633 million (622). Deliveries of completed orders during the first quarter were 3 percent lower than during the corresponding period last year adjusted for the effects of exchange rate movements. The value of work-in-progress increased. The low level of deliveries resulted in earnings and margins falling somewhat. Operating earnings amounted to SEK 35 million (43). The operating margin for the whole year is expected to be in line with the objective of 8-10 percent. During the quarter, Cardo Rail established a more market-oriented organization. Among other things, the introduction of key account managers strengthens the business area's focus on and potential for accompanying the big car builders in their globalization globalization Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation . Liquidity and financing At March 31, the Group's liquid assets Cash, or property immediately convertible to cash, such as Securities, notes, life insurance policies with cash surrender values, U.S. savings bonds, or an account receivable. stood at SEK 274 million (237) compared with SEK 225 million at the beginning of the year. In addition, there are unutilized credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities of approximately SEK 3.1 billion (2.3). Cash flow from operations was SEK 49 million (228) after tax, which is equivalent to SEK 1.63 (7.60) per share. Adjusted for the effects of exchange rate movements on the change in working capital, cash flow was SEK 4.16 (6.68) per share. The Group's gross investments, excluding company acquisitions, stood at SEK 68 million (77). Net interest bearing debt at March 31 amounted to SEK 1,289 million (1,463) compared with SEK 1,265 million at the beginning of the year. Equity amounted to SEK 3,327 million (2,705), which is equivalent to SEK 110.90 (90.18) per share. The Group's equity ratio at March 31 was 43.9 percent (39.8). Personnel The number of employees in the Group at March 31 was 7,971 (7,628). Structural changes On January 1 2001 Cardo Door acquired all shares in the Danish dock loading equipment company Miflex Miljoexpert A/S. The Miflex group, which has a turnover of approximately SEK 80 million and employs 36 people, is included in Cardo Door's invoicing and earnings as of the date of acquisition. Accounting and valuation principles The interim report has been drawn up in accordance with the new recommendation RR 20 of the Swedish Financial Accounting Standards Council concerning interim reports and using the same accounting and valuation principles as in the annual report for the year 2000 with two exceptions. The accounting principles in respect of income taxes and revenues have been adapted to comply with the new recommendations RR 9 and RR 11 of the Swedish Financial Accounting Standards Council. This adaptation has been reported as a change of accounting principles and has resulted in SEK 42 million being credited to equity brought forward at the same time as the comparative figures for the year 2000 have been adjusted. The Group's tax rate, re-calculated in accordance with the new accounting principles, amounted to 34 percent for the year 2000. The same tax rate is expected for the current year. The parent company The parent company's earnings after financial items amounted to SEK -12 million (-17), its gross investments to SEK 0 million (0) and its liquid assets to SEK 76 million (3) as against SEK 1 million at the beginning of the year. Market prospects There continues to be great uncertainty regarding the economic trend in the near future, not least when it comes to the important German market. As regards Cardo, the Group is still considered to be capable of showing greater growth than the underlying market growth during the year through the growth efforts it has made. Malmo, Sweden, May 4 2001 Cardo AB (publ) Kjell Svensson President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. This report has not been subjected to special examination by the Company's auditors. Cardo's interim report for January-June will be published on August 14 2001. Enclosed en·close also in·close tr.v. en·closed, en·clos·ing, en·clos·es 1. To surround on all sides; close in. 2. To fence in so as to prevent common use: enclosed the pasture. : 1. Consolidated income statement consolidated income statement An income statement that combines the income statements of two or more organizations. As with other consolidated statements, a consolidated income statement eliminates any funds owed to or due from firms within the same group. and balance sheet in brief 2. Consolidated cash flow statement in brief 3. Invoiced sales, operating earnings and operating margin by business area 4. Group financial summary Cardo is an international engineering group with a turnover of approximately SEK 10 billion. Cardo holds a strong position in the markets for doors, pumps and rail-vehicle brake systems. Cardo has subsidiaries in about 30 countries with the focal point focal point n. See focus. resting in western Europe Western Europe The countries of western Europe, especially those that are allied with the United States and Canada in the North Atlantic Treaty Organization (established 1949 and usually known as NATO). , and roughly 8,000 employees. ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2001/05/04/20010504BIT00600/bit0002.doc http://www.bit.se/bitonline/2001/05/04/20010504BIT00600/bit0002.pdf http://www.bit.se/bitonline/2001/05/04/20010504BIT00600/bit0002.xls |
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