Report on Year 2000 Operations for the ICA AB Group.Business Editors STOCKHOLM, Sweden--(BUSINESS WIRE)--March 6, 2001 -- Overall store sales up more than the market. -- Earnings before interest and taxes increased by 35 % to MSEK 1,770 (1,310). Earnings include surplus funds Surplus funds Cash flow available after payment of taxes in a project. from SPP (1) (Scalable Parallel Processor) A multiprocessing computer that can be upgraded by adding more CPUs. (2) (Standard Parallel Port) The Centronics parallel port that was used on the first PCs. with MSEK MSEK Meyer, Suozzi, English & Klein (New York law firm) MSEK Million Swedish Kroner 138. -- Earnings before taxes increased by 32 % to MSEK 1,738 (1,318). -- Continued strong financial position.
Financial Information in Summary*
2000 1999
Net sales, MSEK 59,09 58,09
2 1
EBITDA, MSEK 2,923 2,316
EBIT, MSEK 1,770 1,310
Earnings before taxes, MSEK 1,738 1,318
Net earnings, MSEK 1,183 917
Total assets, MSEK 25,30 23,15
8 0
EBIT margin, percent 3.0 2.3
Equity/assets ratio, percent 37.2 38.6
Return on capital employed, 13.7 13.0
percent
Return on equity, percent 13.1 9.7
* According to Swedish GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). Comment by the Chairman "2000 has been one of our most successful years so far. Store sales have been very strong, particularly in Sweden. The Group result is our best ever. We have established the partnership with Royal Ahold and the coordination between the two companies proceeds according to plan. A new corporate structure has been established. We are in an excellent position for future growth, further improvement of our results, and to continue to serve our customers well in an increasingly competitive marketplace," says Roland Fahlin, ICA Ica (ē`kä), city (1993 pop. 108,724), capital of Ica dept., SW Peru, on the Pan-American Highway. It is a commercial center for the cotton, wool, and wine produced in the region. There are several summer resorts nearby. Ahold AB Chairman. The ICA Group 2000 In April the partnership between Royal Ahold, ICA Forbundet and Canica was established through the newly founded company ICA Ahold AB, which controls 100.0 % of the shares in ICA AB. ICA Ahold AB is owned by Royal Ahold by 50 %, ICA Forbundet 30 % and Canica 20 %. A new board of directors was appointed in April. Roland Fahlin is chairman with Jan Andreae and Stein-Erik Hagen as vice-chairmen. Other members are Michael Meurs, Gerard van Breen, Han Willemse, Per-Anders Olofsson, and Claes-Goran Sylven. To maximize business development throughout Scandinavia and step up service to its millions of customers, the ICA-Ahold joint venture streamlined its management structures in Sweden, Norway, Denmark and the Baltic States. ICA Ahold AB and ICA AB will merge into one company. The CEO's of the operating companies report directly to the Board. The Chairman and President of the company, Roland Fahlin, is liaison officer for ICA Handlarnas and ICA Menyforetagen. Deputy Chairman and Deputy President Stein Erik Hagen Stein Erik Hagen is a Norwegian businessman who, with his father, opened a discount supermarket in the late 1970s. Ultimately he partnered with supermarket giant Ahold, obtaining both a cash payout and a 20% stake in the company. is the Board's liaison officer for Hakon Gruppen and ICA Baltic. Two of the operating companies have appointed new CEO's during the year, Kenneth Bengtsson for ICA Handlarnas AB and Oyvind Winther for Hakon Gruppen AS. Also, Lennart Kall has been appointed 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. for ICA's planned bank. ICA Handlarnas AB took a decision to group all stores into store formats. The profiles are: ICA Nara, ICA Supermarket, ICA Kvantum, Maxi ICA Stormarknad, and Rimi. The different formats satisfy different purchase needs of the customer. These distinct store formats will facilitate the building of brands, development of the product range and marketing. The work with the realisation of synergies between ICA Handlarnas and Hakon Gruppen continued. Several important steps were taken within sourcing, private label and IT. New Nordic supplier agreement were signed, a new Nordic strategy for ICA's private label products is being implemented, and the work to create a mutual IT-structure is well under way. The coordination between ICA and Statoil Detaljhandel has led to several concrete results during the year. By end of 2000 a total of 66 ICA Express stores had been established at Statoil gas stations in Sweden (34), Norway (28) and Denmark (4). As a consequence, the first store with the ICA brand has opened in Denmark. Further, ICA Customer card members now can use their card and earn bonus through purchases at Statoil stations in Sweden. ICA has continued its expansion in the Baltics during the year. In February, the Interpegro-stores in Latvia were acquired. In November, ICA Baltic acquired 12 stores from Vikonda Group through its 50/50 owned Lithuanian company EKO EKO Engineering Knowledge Online (USACE) EKO Elko, NV, USA - J C Harris Field (Airport Code) EKO Edgeworth-Kuiper-Object (meteorid system) . At the end of 2000 ICA Baltic operated in total 51 stores in the Baltic region and annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. store sales amount to some MSEK 1,700. In Denmark ICA has strengthened its presence through the acquisition of 50 % of ISO (1) See ISO speed. (2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. , with sales of MSEK 1,300 and 11 stores in the greater Copenhagen area. This agreement is an important step in the establishment of a position in the Danish every-day-food market. In July, ICA Finans signed an agreement for a syndicated bank loan of 5,000 MSEK with a group of banks, led by ABN Amro Bank, Den Norske Bank Den norske Bank or DnB was a Norwegian bank that existed between 1990 and 2003 when it merged with Gjensidige NOR to form the present DnB NOR. The bank's headquarters were in Bergen, Norway. and Svenska Handelsbanken. The Market Sweden The ICA retailers increased sales by 4.4 percent during the year (3.6 % for comparable stores). This is better than the total for the sector, which increased by 2.9 %. The Maxi, Kvantum and Rimi stores had the best sales development within ICA. Total store sales amounted to 68 BSEK (incl. VAT). Norway The sales in Hakon Gruppen's stores increased by 2.2 % (0.9 % for comparable stores) in 2000. Discount stores continued to increase at the expense of traditional supermarkets on the Norwegian market. The largest increase within Hakon Gruppen was seen for Maxi and Rimi. Total store sales for Hakon Gruppen amounted to 19 BNOK (excl. VAT). The Baltic region Sales for ICA Baltic's stores in the Baltic countries continued to grow and amounted to 1.3 (0.3) BSEK. Sales and Earnings Group sales Group sales Block sale (of large amounts) of securities to institutional investors. group sales The distribution of a new security issue to institutional clients. amounted to 59,092 MSEK (58,091), an increase with 1.7 % compared to last year. Group sales have been negatively effected by lower sales for ICA Menyforetagen. Earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
EBIT = Operating Revenue – Operating Expenses + Non-operating Income (EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). ) increased by 35 % to 1,770 MSEK (1,310) and the EBIT margin to 3.0 % (2.3 %). In the EBIT, surplus funds from SPP are included as other 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 to an amount of MSEK 138. Excluding the SPP-funds the EBIT increased by 25 % to MSEK 1,632. Earnings before taxes increased by 32 % to MSEK 1,738 (1,318). Excluding the capital gain on the divestiture of ICA-Forlaget during the first quarter 1999, the 1999 result was MSEK 1,200. Share of earnings in associated companies increased to MSEK 186 (35) due to higher result in Statoil Detaljhandel. Net financial expenses increased by MSEK 73 to MSEK -218 (-145), foremost as a consequence of higher interest expenses due to the Group's higher net debt. Free 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 capital expenditure and changes in working capital amounted to MSEK -1,848 (-3,543). 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). improved to 13.7 % (13.0). Return on equity increased to 13.1 % (9.7). Financial Position Total assets increased by MSEK 2,158 to MSEK 25,308 (23,150) since the beginning of the year. Capital employed Capital Employed 1. The total amount of capital used for the acquisition of profits. 2. The value of all the assets employed in a business. 3. Fixed assets plus working capital. 4. Total assets less current liabilities. increased by MSEK 1,081 to MSEK 16,848 (15,767). The Group's cash and cash equivalents as of 31 December 2000 amounted to MSEK 732 (1,150). Net interest bearing debt increased to MSEK 6,707 (5,710). Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. amounted to 9,313 MSEK (8,798). The equity to assets ratio was 37.2 % (38.6). Capital Expenditures Capital expenditures amounted to gross MSEK 4,664 (5,671). The largest capital expenditures were the investment in ISO in Denmark and the acquisition of Interpegro in Latvia. Parent Company The parent company had no sales during the period. The EBIT was MSEK -98 (- 59). Important Events during the Fourth Quarter 2000 The Board has decided to start banking operations. As a consequence, on November 10, ICA Kundkort AB submitted its application for a bank license to the Swedish Financial Supervisory Authority. Operations are planned to begin during the third quarter 2001. ICA Handlarnas AB presented a simplified new organizational structure with a pronounced retail focus from 2001. The new organization will reduce annual costs with MSEK 150 and reduce employees with 150. Hakon Gruppen AS presented a new organizational structure to secure retail focus. Stockholm March 6, 2001 ICA AB (publ.) Roland Fahlin, President This release has not been audited by the Company's auditors. ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2001/03/06/20010306BIT00670/bit0002.doc http://www.bit.se/bitonline/2001/03/06/20010306BIT00670/bit0002.pdf |
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