Interim report January-March 2014
Lund, 2014-05-12 13:36 CEST --
Stable EBITDA, in spite of lower sales in the Nordics
and North America
Highlights of the first quarter, 2014:
• Order intake amounted to SEK 238.0 m (252.2).
• Net sales amounted to SEK 233.0 m (208.9), an increase of 11,5 percent.
Adjusted for acquisitions sales decreased by 15.4 percent.
• Operating profit (EBIT) totalled SEK 4.7 m (7.7). The operating margin was 2.0 percent (3.7).
• Profit after tax for the period amounted to SEK 2.0 m (7.4).
• Earnings per share after tax amounted to SEK 0.10 (0.38).
• Cash flow from current activities amounted to SEK -28.8 m (18.3).
• New outlook 2014: Doro expects growth in 2014, mainly during the second half of the year.
CEO Jérôme Arnaud:
We keep investing in future growth of smart phones
The year has started off with a 12 percent growth of total sales in the first quarter com-pared to last year with a sustained market share. However, as predicted in our year-end report 2013, sales excluding IVS and order intake in the first quarter decreased com-pared to the strong first quarter last year. In US and Canada we had large shipments in the fourth quarter 2013, leading to some negative phasing effects in the first quarter this year. Secondly, in the Nordics a decreasing feature phone market has affected our sales. Our ramp up of smart phones, that we expect to improve gradually during the year, has not yet been able to compensate this.
Our EBITDA in the quarter increased to SEK 16.0 m (14.2). EBITDA was affected posi-tively by an improved gross margin and negatively by increased marketing efforts. The EBIT result decreased to SEK 4.7 m (7.7) as our depreciations related to product invest-ments has increased, following the launch of the new generation of smart phones.
Our growth strategy is built on providing more user-friendly smart phones and other connected devices adapted for seniors distant from technologies. We constantly moni-tor the evolution of their needs and our new store in Paris is one step in strengthening our direct contact with our target group and end users. Smart phones are our route to higher value product sales and hence continued strengthening of the gross margin. Smart phones have also increased our possibilities, as they are the platform for recurring revenues from connected services. We keep investing in this category, as it will con-tribute to our growth in the second half of the year and long-term.
Our competitiveness within feature phones remains strong. At the industry’s leading fair, the Mobile World Congress (MWC) in February, we announced four new products that enhance our offer. We therefore expect our market share in feature phones to im-prove during the second half of 2014, as we anticipate listings from new major telecom operators in Europe. This will also support our growth during the second half of the year.
In the Care category we have made progress during the first quarter, with shipments of our unique mobile Telecare products to distributors – however still on modest sales lev-els. Our efforts in this category provide us with long-term potential, and it benefits from the investments we do in developing other products.
The demographic shift with a growing population of seniors will be the continued im-portant driver for Doro and our market. With technology evolving at a faster pace than it can penetrate the over-65 population, we see increased demand for a wider range easy-to-use connected devices adapted for senior-level comfort.
For further information, please contact:
President & CEO, Jérôme Arnaud, +46 (0)46 280 50 05
CFO, Christian Lindholm, +46 (0) 46 280 50 06
Doro AB discloses the information provided herein pursuant to the Securities Markets Act and/or the Financial Instruments Trading Act. The information was submitted for public release on Tuesday, May 12, 2014, at 07:30 a.m. CET.
Doro AB is a Swedish public company formed in 1974. It released its pioneering ‘easy-to-use’ mobile phone in 2007 and today is the global market-leader within the category. Doro products and solutions are available in more than thirty countries spanning five continents. These include; mobile phones and smart devices, applications and software, fixed line telephony, telecare and mobile health solutions. Doro removes barriers to adoption of new technologies and holds numerous international awards in recognition of its product designs and innovations. Doro shares are quoted on the Nasdaq OMX Stockholm exchange, Nordic List, Small Companies. Net sales of SEK 1,142.5 million (EUR 128.9 million) were reported for 2013. www.doro.com