Proffice interim report

Transcription

1 Proffice interim report JANUARY MARCH 2009 A record strong result for Proffice Net turnover increased by 4 % to MSEK 1,049 (1,007) Operating profit before tax MSEK 48 (20) Operating profit after tax MSEK 34 (15) Earnings per share SEK 0.46 (0.17) Improved cash flow from current operations MSEK 47 (6) Lars Kry, CEO, comments: Proffice produces the strongest first quarter ever on a very tough market. Both turnover and operating profit increased to record levels. Specialist strategy pays off When forming a new specialist strategy, three years ago, we knew it would mean better earnings. The first quarter 2009 is yet another proof our momentum continues. Today, a larger share of turnover comes from the specialist companies with higher margins. A better service mix and proactivity make us less vulnerable to economic cycles than previously. Offering in up and down turns The staffing industry is often regarded as the same as temporary staffing. And that is a big portion of our business, but not all of it. Proffice has a broader offering with recruitment, temporary staffing and outplacement. This makes us a valuable partner to our customers and it means that we make money in up and down turns. In current economic down turn there is a decreased demand for recruitment services. At the same time the turnover outplacement has increased by 313 per cent, which gives us a leading position on the Swedish market. And the business continues to develop strongly with a good profitability. Restructuring gives effect The restructuring programme initiated in September 2008 has lead to significant cost reductions during the first quarter. Up till now, the economy measures are worth MSEK 120 on an annual basis. Denmark and Finland deliver a better result than during the same period 2008, and business is more stable in both countries. The development in Norway has not met with our expectations, and a number of measures have been taken. All in all, the Proffice management will continue to focus on improving margins in the whole group and to act early. Proffice is the specialised flexible staffing company with more than 12,000 employees in the Nordic region. We provide temporary staffing, recruitment services, and outplacement. Proffice is listed on the NASDAQ OMX Nordic Exchange Stockholm, Small Cap. For more information see

2 Proffice takes market shares The Nordic staffing market continues to decrease. Compared to the same quarter 2008, the Swedish market decreased by 20 per cent at the same time as Proffice in Sweden increased by 14 per cent. More customer visits are made with fewer staff, and we continue to win our customers confidence. New agreements are signed by e.g. AstraZeneca, SVT, COOP in Norway and Vattenfall in Finland. The current economic cycle requires increased flexibility We expect a continued weak demand for recruitment services, a more stable demand for temporary staffing and a continued growth for outplacement. In the current economic cycle, there is an increased need for more flexibility in staffing and we believe that long term; this will be an advantage for the staffing industry. IMPORTANT EVENTS DURING THE PERIOD The restructuring programme continued Proffice ongoing restructuring programme has been successful. The operations have been coordinated in fewer offices, and the number of internal staff has been reduced in order to meet the economic down turn and all other costs have been scrutinized. Up till now, the restructuring costs have been reduced by MSEK 120 for rolling 12 months. The sale of part of the operations in Denmark was closed The sale of the Industry and Logistics operations in Denmark that was made in December 2008, was closed in the beginning of January. This has resulted in an extra cost of MSEK 2 during this quarter. Proffice renews frame agreement with AstraZeneca AstraZeneca renewed the frame agreement until March This means that Proffice will continue as a main supplier of staffing services to the pharmaceutical company. Proffice Finland in new cooperation with Vattenfall in Finland Proffice has signed an order with Vattenfall in Finland for 50,000 customer cases during a five month period. The assignment which calls for a close cooperation with Vattenfall s customer service means that Proffice will hire, train and manage the temporary staff force. Proffice in Norway signs agreement with COOP COOP Norway has signed a cooperation agreement with Proffice. The agreement which is an open agreement without expiration date is for temporary staffing and recruitment services within the areas warehousing/logistics, office/customer service and finance. IMPORTANT ACTIONS AFTER THE END OF THE PERIOD Proffice Mediakompetens signed an agreement with SVT (Swedish Television) The staffing service agreement which is for editorial and production staff is valid for two years Proffice chosen for major new health care agreement to supply physicians for Norwegian hospitals through the daughter company Medifact Proffice s Norwegian daughter company Medifact will sign a two-year agreement as a supplier of physicians to Norwegian hospitals after a public procurement. Helse Norway purchases substitutes for approximately MNOK 800 annually. Starting date has been delayed due to an appeal which effects all chosen suppliers. New expected starting date is June 1 with signing at the end of May. Proffice 2(10)

3 OPERATIONS The Group operating areas Proffice is active within three operating areas. Temporary staffing, Recruitment and Outplacement (Career & Development). Proffice has a broad offering within the different operating areas is an interesting partner for customers in different economic cycles. Currently, our operating area Outplacement is growing and contributes strongly to both turnover and operating profit. Break-down by operating areas Jan-Mar Jan-Mar Jan-Mar MSEK Growth Net turnover Temporary staffing % Recruitment % Outplacement % Total 1,049 1,007 4% Temporary staffing 85% Recruitment 3% Outplacement 12% Temporary staffing per business area Hiring personnel is the simple, fast way of securing the right competence without having to take any major risks or committing oneself to huge expense. We offer our customers competent personnel where they are needed, when they are needed and for as long as they are needed. Temporary staffing is the basis of our operations and means that we can provide competent personnel for short or long periods of time. In 2008, we supplied a specialist to our customers every twenty minutes. Temporary staffing which is Proffice s largest operating area is divided into a number of business areas. We offer temporary staffing both through our specialist companies and through our national Proffice units. Cyclically stable areas; such as health care has seen a continued growth, and also IT. Business area Industry and Logistics has decreased and amounts for 24 % of all temporary staffing turnover, compared to previously 33%. Break-down by business area Jan-Mar Jan-Mar Jan-Mar MSEK Growth Finance 12% Office/Cust 34% IT 14% Indust/Logist 24% Care 11% Life Science 4% Other 1% Temporary staffing Finance % Office/Cust % IT % Indust/Logist % Care % Life Science % Other % Proffice 3(10)

4 Sweden The Swedish operations continued to grow during the first quarter, 14% on a market which according to statistics from the staffing industry showed a significant decrease by 20%. The economic downturn was first evident for the Swedish operations and the restructuring programme was planned already during the third quarter The early measures have lead to cost reductions already during the first quarter and this, together with the contra cyclical Outplacement operation has contributed strongly to profitability. Norway The economic downturn was not evident until the last months of 2008 in Norway, and this is why we have not yet seen the full effect of our restructuring programme. We continue our work to adjust operations by a reduction of the number of offices and through a review of the organisation. Denmark Through the sale of our Industry and Logistic operation in Denmark, the volume has almost decreased to half the volume. During the period Proffice Denmark has had extra costs of MSEK 2 in connection with the closing. Proffice Care in Denmark has continued good profitability. Finland Finland has unchanged volumes compared to last year. The current restructuring programme is beginning to give effect and the results is somewhat better even if remained negative. Break-down by countries Jan-Mar Jan-Mar Growth MSEK % Turnover Sweden % Norway % Denmark % Finland % Total 1,049 1,007 4% Operating profit Sweden % Norway % Denmark % Finland % Other % Total % Operating margin % Change Sweden 8.1% 4.7% 3.4% Norway 0.7% 1.2% -0.5% Denmark -1.6% -1.4% -0.3% Finland -3.9% -7.9% 4.0% Other neg neg Total 4.6% 2.0% 2.6% Proffice 4(10)

5 Allocation by operating segment Proffice s Nordic specialist companies currently include Proffice Care (Health Care), Dfind (IT), Proffice Life Science, and Antenn (Outplacement). The growth has been good, especially for Antenn, with a growth that more than tripled. The specialist companies continue to develop a better profitability through higher margins and a better service mix. For our national companies as a total, the growth has been negative, on a reduced market. Especially the Industry and Logistic businesses faced a major decline. The operating profit is stable compared to previous year, especially driven by a quick adjustment of the cost base through the ongoing restructuring program. Break-down by segment Jan-Mar Jan-Mar Growth MSEK % Turnover National companies % Nordic specialist companies % Other % Total % Operating profit National companies % Nordic specialist companies % Other % Total % Result from financial investments 0-1 Result after financial items Others include the parent company and elimination of sales between segments. THE PROFFICE SHARE The total number of shares per March 31, 2009 was 69,723,773, of which 65,723,773 are series B shares. In accordance with a resolution at the annual general meeting 2007, an options program to the Nordic Management Group was carried through in The offer was made on terms adjusted to market conditions. On redemption of the options, a maximum of 2,100,000 new shares can be issued which corresponds to a dilution of approx 2.92 per cent of the total number of shares in Proffice AB (publ). The Proffice share is listed in the Small Cap segment at the Nasdaq OMX Exchange in Stockholm. The round lot is 500 shares. Data per share Jan-Mar Jan-Mar Number of shares at end of period 69,723,773 69,723,773 Average number of shares 69,723,773 69,723,773 Earnings per share, SEK 1) Shareholders' equity per share, SEK ) Earnings per share is calculated as profit after taxes on continued operations relating to owners of parent company divided by average number of shares Proffice 5(10)

6 FINANCIAL INFORMATION Group turnover and operating profit The Group net turnover for the first quarter 2009 was MSEK 1,049 (1,007), a 4 % increase compared to the same period previous year. The Group operating profit for the first quarter 2009 was MSEK 48 (20). The result after financial items for the first quarter 2009 was MSEK 48 (19). Financial items include exchange differences of MSEK 9(5). Liquidity and financial position Cash and bank as of March 31, 2009 was MSEK 200 (120) and the equity/assets ratio was 36 (33) %. The disposable liquid assets have increased by MSEK 32 compared to year-end The disposable liquid assets, including unused credit undertakings, amounted to MSEK 380 (258). Interest-bearing liabilities amounted to MSEK 32 (73). Group interest-bearing liabilities have been reduced by MSEK 14 during The Group shareholders equity as per March 31, 2009, was MSEK 570 (468), an increase by MSEK 51 since year-end Cash flow The cash flow from current operations was MSEK 47 (6), of which changes in working capital amounted to MSEK 14 (0). The cash flow from investment activities was MSEK -6 (-9), of which acquisitions amounted to MSEK 0 (-1), acquisitions of tangible fixed assets were MSEK -6 (-8). Cash flow from financing activities was MSEK -16 (-25) and consists primarily of amortizations of acquisition loans regarding Medifact AS with MSEK -2 (-2) and that invoice financing has been less utilized. Taxes The Group tax expenses for the period was MSEK -14 (-4). The tax rate for the year was 29.2 (21.1) %. No tax assets have been activated for this year s tax claims in part of the Danish operations. The tax expense is calculated by actual tax rate for the parent company and respective daughter companies. Temporary differences and existing deficit deduction have been taken into account. The tax claim refers to the Danish and the Finnish operations. Personnel The average number of full-time employees was 6,866 (7,859) a reduction by 993 full-time employees or 13%. Transactions with related parties During the period, there have been no transactions with related parties of substantial impact for the company or for the result of the company except usual transactions between Group companies. Risk management and uncertainty factors The most significant risk and uncertainty factors for the Group and the Parent Company primarily include sensitivity to the economic situation and market changes. Another uncertain factor is the availability of qualified employees. In addition to this, Proffice is exposed to financial risks due to the presence in the Nordic countries, primarily exchange rate risks. Influence factors and financial risk management is further described in Proffice s annual report 2008, note 1 and note 2 (page 26). In addition to these risks, there are no new significant risks identified. Parent company The parent company includes among other things group functions for Finance, HR, IT, Marketing and Communications. The net turnover amounted to MSEK 13 (5) and consists of inter company invoicing of services only. The operating profit for the parent company was MSEK -11 (-10) for the period. The result after financial items was MSEK -10 (-10). Investments in tangible fixed assets were MSEK 0 (3). The Proffice 6(10)

7 disposable liquid assets amounted to MSEK 273 (147), including unutilized credit undertakings of MSEK 180 (138). Accounting principles The Group interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and applicable parts of chapter 9, Interim Report, in the Swedish Annual Accounts Act. The interim report for the Group and the parent company has been prepared in accordance with same accounting principles as used in the annual report 2008 Amended IAS 1 Presentation of Financial Statements has been applied as per January 1, The change means, among other things, which income and expenses previously recorded directly in equity are now recorded as an element in a report on comprehensive income. Another change is that new names can be used for the financial statements, although not mandatory. The Group has chosen to retain old names, although from 2009 we will present a report on comprehensive income. As from January 1, 2009 the Group applies also IFRS 8 Operating Segments. The application of IFRS 8 means that the Group reports segments allocated to national companies and Nordic specialist companies. There is no follow-up on assets regarding these segments. This interim report has not been subject to the Company's auditors' review Stockholm May 7, 2009 Proffice AB (publ) Lars Kry CEO Questions related to this report will be answered by: Lars Kry, CEO, phone lars.kry@proffice.se. Anneli Lindblom, CFO, phone anneli.lindblom@proffice.com Proffice AB (publ), org. nr , Box 70368, Stockholm. Tfn: , info@proffice.com Upcoming reports Interim report January June 2009: at 08:00 Interim report January September at 08:00 The above information is such that Proffice AB must disclose pursuant to the Swedish Securities market Act. Proffice 7(10)

8 Profit & loss account for the group in summary Jan-Mar Jan-Mar Jan-Dec MSEK Net turnover 1,049 1,007 4,266 Operating costs Staff costs ,425 Other external costs Restructuring costs Depreciation of tangible assets Amortisation of goodwill Write-down of goodwill Operating profit Result from financial investments Interest income and similiar items Interest expenses and similiar items Exchange rate difference Result after financial items Taxes Result for the period after taxes Other comprehensive income for the period Total result for the period Result for the period relating to: Owners of parent company Minority interest in period s result Total result for the period relating to: Owners of parent company Minority interest in total result Earnings per share before and after dilution, SEK 1) ) Earnings per share is calculated as profit after taxes on continued operations relating to owners of parent company divided by average number of shares Balance sheet for the group in summary Mar Mar Dec MSEK Assets Intangible assets Tangible assets Financial assets Current receivables Liquid resources Total assets 1,576 1,400 1,500 Shareholders' equity and liabilities Shareholders' equity Minority interest Non interest-bearing long-term liabilities Interest-bearing long-term liabilities Non interest-bearing short-term liabilities Interest-bearing short-term liabilities Total shareholders' equity and liabilities 1,576 1,400 1,500 Pledged assets Key ratios Jan-Mar Jan-Mar Operating margin 4.6% 2.0% Profit margin 4.6% 1.9% Return on shareholders' equity 17.3% 25.6% Net debt, MSEK Equity/assets ratio 36.2% 33.4% Average number of employees 6,866 7,859 Proffice 8(10)

9 Change in shareholders' equity Attributable to the parent company shareholders Share- Other Reserves Profit Attributable Total MSEK capital contributed brought to minority shareholder's capital forward shareholders equity Shareholders' equity December Profit after taxes Shareholders' equity March Profit after taxes Dividend Shareholders' equity December Profit after taxes Shareholders' equity March Cash flow for the group Jan-Dec Jan-Dec MSEK Current operations Result after financial items Adjustments of items not included in cashflow Reversed depreciation and write-downs 3 2 Other 0 0 Tax paid Cash flow from current operations before change in working capital 33 6 Change in working capital Change in receivables -4 1 Change in liabilities 18-1 Total change in working capital 14 0 Cash flow from current operations 47 6 Investment activities Acquisition of subsidiary - -1 Purchase of tangible assets -6-8 Sale of tangible assets 0 0 Cash flow from investment activities -6-9 Financing activities Amortisation of loans Cash flow from financing activities Cashflow for the period Cash and bank, OB Exchange rate differences in cash and bank 7-2 Cash and bank, CB Proffice 9(10)

10 Profit & loss account for the parent company in summary Jan-Mar Jan-Mar Jan-Dec MSEK Net turnover Operating costs Staff costs Other external costs Restructuring costs Depreciation of tangible assets Operating profit Result from financial investments Result from shares and participations in group companies Interest income and similiar items Interest expenses and similiar items Exchange rate difference Result after financial items Transfer to untaxed reserves Taxes Result after taxes Balance sheet for the parent company Mar Mar Dec MSEK Assets Tangible assets Financial assets Current receivables Liquid resources Total assets 1, ,296 Shareholders' equity and liabilities Shareholders' equity Non interest-bearing short-term liabilities Interest-bearing short-term liabilities Total shareholders' equity and liabilities ,296 Pledged assets Contingency liabilities Proffice 10(10)