EKORNES ASA 3 rd QUARTER 2009 1
Ekornes Q3 - Headlines: 3. kvartal Solid figures despite downturn and downsizing of capacity EBIT MNOK 334.2 (2008: MNOK 313.0) EBT MNOK 294.4 (2008: MNOK 323.2). Currency effects MNOK -38.5 (MNOK +11.2 in 2008) Operating revenue only slightly down (-1.0%). Affected by reduced capacity, but positive currency effects. Down 7.2% using fixed exchange rates In general, markets still challenging and uncertain. However signs to improvement Order income up 10%. Down 1.0% using fixed exchange rates Strong growth in Central Europe (+12%) and Asia/Pacific(+7%) Norway up 28% - mainly due to higher sales of mattresses Flat in UK and Japan Decline in other markets Production capacity Stressless seats down 15%. Seven days of production less in 2009. Seats per day down (1,522 seats/1,707 seats). Capacity build up through Q3 1,570 seats by end Q3. Further increase to 1,700 seats end Q4. Svane improved distribution in Norway as from June revenues up 16.5% Good order income 2009. Order book building up. Full capacity utilisation expected also in Q4 (However, still at a lower level than 2008) 2
Development in Operating Revenue: 2000 1 844 1 887 1 928 1 909 1 688 1500 1000 552 585 617 624 645 500 0 2005 2006 2007 2008 2009 Q3/05 Q3/06 Q3/07 Q3/08 Q3/09 YTD Q3 Q3 3
2500 Development in Operating Revenue 2 673 2 654 2 574 2 507 2 248 2 292 2000 1 710 1 828 2 012 1500 1 536 1000 500 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 '08/09 4
News 2010: Stressless E200 and Stressless E300: 5
News 2010: Stressless Jazz: Stressless Soul: 6
Distribution of operating revenues by product area year to date (Mill.NOK) 3. kvartal 1250 1000 967 1084 1132 1140 1080 750 500 480 541 550 572 489 250 184 160 197 175 204 0 57 59 59 50 75 Stressless chairs Sofa Mattresses Other 2005 2006 2007 2008 2009 7
Distribution of operating revenues by product area Sofas year to date (Mill.NOK) 3. kvartal 750 541 550 572 500 480 489 376 403 433 361 287 250 193 164 147 139 128 0 Sofas Stressless sofa Ekornes Collection 2005 2006 2007 2008 2009 8
Distribution of operating revenues by product area quarterly data (Mill.NOK) 3. kvartal 500 349 363 349 385 308 250 152 168 169 178 160 0 73 47 79 73 80 19 21 20 11 20 Stressless chairs Sofas Mattresses Other Q3/2005 Q3/2006 Q3/2007 Q3/2008 Q3/2009 9
Distribution of operating revenues by product area sofas quarterly data (Mill.NOK) 3. kvartal 250 200 150 152 168 169 178 160 119 137 132 111 100 92 50 60 49 32 46 49 0 Sofas Stressless sofa Ekornes Collection Q3/05 Q3/06 Q3/07 Q3/08 Q3/09 10
Contribution margin by product area 60 % 50 % 55,9 % 53,6 % 53,6 % 54,7 % 52,0 % 45,8 % 43,6 % 43,3 % 42,2 % 50,1 % 48,0 % 47,6 % 48,1 % 46,5 % 40 % 38,0 % 35,1 % 35,6 % 33,9 % 32,6 % 39,0 % 30 % 20 % 10 % 0 % Chairs Sofas Mattresses Totalt 2006 2007 2008 YTD/08 YTD/09 11
Development in direct costs 50 % 50,1 % 48,0 % 47,6 % 46,5 % 48,1 % 40 % 30 % 22,9 % 25,1 % 25,3 % 25,0 % 24,0 % 20 % 15,3 % 15,5 % 15,4 % 16,6 % 14,4 % 10 % 0 % Direct material Direct salaries ex. employee bonus Contribution Margin 2006 2007 2008 YTD/08 YTD/09 12
Development in direct salaries at the factories (Based on factory revenues, year-end bonus not included) 3. kvartal 40 % 35 % 32,2 % 31,6 % 34,5 % 30 % 27,4 % 25 % 21,4 % 22,3 % 21,2 % 23,7 % 23,8 % 21,6 % 21,1 % 20 % 17,4 % 16,9 % 15 % 14,3 % 14,8 % 10 % 5 % 0 % Stressless prod. Sykkylven (excl. Tynes) Tynes Grodås Hareid Fetsund 13 2008 YTD/08 YTD/09
Contribution and operating margin (EBIT) 50 % 50,1 % 48,0 % 47,6 % 46,5 % 48,1 % 40 % 30 % 29,6 % 29,9 % 30,3 % 30,3 % 30,6 % 20 % 20,5 % 18,1 % 17,3 % 16,2 % 17,5 % 10 % 0 % Contribution Margin Other Costs EBIT 2006 2007 2008 YTD/08 YTD/09 14
Development in Operating result (EBIT) and Pre-tax margin (EBT): 3. kvartal 25 % 22,2 % 22,7 % 21,1 % 21,9 % 20 % 19,5 % 20,1 % 20,0 % 20,1 % 18,7 % 18,4 % 15 % 17,0 % 15,7 % 17,0 % 16,7 % 16,8 % 14,9 % 17,0 % 15,5 % 14,0 % 10 % Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06 Q1/07 Q2/07 Q3/07 Q4/07 Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 15 EBIT individual quarter EBT individual quarter
Development in Operating result (EBIT) and Pre-tax margin (EBT) year to date: 3. kvartal 25 % 20 % 20,5 % 19,9 % 17,5 % 17,9 % 17,1 % 18,0 % 18,6 % 17,4 % 17,4 % 17,5 % 15 % 16,2 % 10 % 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 16 EBIT YTD EBT YTD
Development EPS fully diluted (Figures in NOK) 7,50 6,69 5,46 5,70 6,10 5,56 1,91 2,22 1,52 2,29 2,33 0,00 2005 2006 2007 2008 2009 2005 2006 2007 2008 2009 EPS/YTD EPS/Q3 17
Income Statement year to date (mill. NOK) 2009 2008 Changes Operating revenues 1,908.5 100.0% 1,928.2 100.0% -1.0% Materials 457.6 24.0% 481.2 25.0% -4.9% Salaries and social costs 512.1 26.8% 556.0 28.8% -7.9% Other operating expenses 522.4 27.4% 500.1 25.9% 4.5% Depreciation 82.2 4.3% 77.9 4.0% 5.5% Total operating costs 1,574.3 82.5% 1,615.2 83.8% -2.5% Operating result 334.2 17.5% 313.0 16.2% 6.8% Net financial income/expenses -1.3-0.1% -1.0-0.0% Profit/loss currency exchange -38.5-2.0% 11.2 0.6% Ordinary result before taxes 294.4 15.4% 323.2 16.8% -8.9% Calculated taxes ordinary result -89.8-4.7% -98.6-5.1% -8.8% Ordinary result after taxes 204.6 10.7% 224.6 11.7% -8.9% EPS 5.56 6.10 18
Income Statement individual quarter (mill. NOK) Q3/09 Q3/08 Changes Operating revenues 645.4 100.0% 624.3 100.0% 3.4% Materials 147.8 22.9% 158.3 25.3% -6.6% Salaries and social costs 153.6 23.8% 166.8 26.7% -7.9% Other operating expenses 169.8 26.3% 166.4 26.7% 2.0% Depreciation 27.7 4.3% 26.5 4.2% 4.5% Total operating costs 498.9 77.3% 518.0 83.0% -3.7% Operating result 146.5 22.7% 106.3 17.0% 37.7% Net financial income/expenses -0.3-0.0% -3.0-0.5% Profit/loss currency exchange -23.1-3.6% 18.1 2.9% Ordinary result before taxes 123.1 19.1% 121.4 19.4% 1.3% Calculated taxes ordinary result -37.6-5.8% -37.1-5.9% 1.1% Ordinary result after taxes 85.5 13.3% 84.3 13.5% 1.3% EPS 2.33 2.29 19
Income Statement 1 OCT/30 SEP (mill. NOK) 2009 2008 Changes Operating revenues 2,653.5 100.0% 2,615.2 100.0% 1.5% Materials 652.9 24.6% 664.6 25.4% -1.8% Salaries and social costs 633.0 23.9% 727.9 27.8% -13.0% Other operating expenses 759.5 28.6% 669.8 25.6% 13.4% Depreciation 124.2 4.7% 102.8 3.9% 20.8% Total operating costs 2,169.6 81.8% 2,165.1 82.8% 0.2% Operating result 483.9 18.2% 450.1 17.2% 7.5% Net financial income/expenses -3.5-0.1% -0.2 0.0% Profit/loss currency exchange -12.3-0.5% 11.2 0.4% Ordinary result before taxes 468.1 17.6% 461.1 17.6% 1.5% Calculated taxes ordinary result -140.6-5.3% -136.3 5.2% 3.2% Ordinary result after taxes 327.5 12.3% 324.8 12.4% 0.8% EPS 8.89 8.82 20
Balance Sheet (mill. NOK) 3. kvartal Q3/09 H1/09 CHANGES Total Long Term Assets 949.3 982.2-32.9 Inventories 224.6 256.0-31.4 Trade Debtors 356.2 371.9-15.7 Other Current Assets 37.8 36.2 1.6 Value of forward contracts 57.7-57.7 Cash and Bank Deposits 160.8 36.4 124.4 Total Current Assets 837.1 700.5 136.6 TOTAL ASSETS 1,786.4 1,682.7 103.7 Total Equity 1,410.9 1,243.9 167.0 Provisions, commitments, deferred tax 45.0 29.2 15.8 Trade Creditors 96.2 98.5-2.3 Taxes, VAT and national insurance 94.8 84.8 10.0 Value of forward contracts - 74.9-74.9 Other current liabilities 139.5 151.4-11.9 Total Liabilities 375.5 438.8-63.3 TOTAL EQUITY AND LIABILITIES 1,786.4 1,682.7 103.7 21
Balance Sheet (mill. NOK) 22 Q3/09 Q3/08 CHANGES Total Long Term Assets 949.3 968.6-2.0% Inventories 224.6 257.1-12.6% Trade Debtors 356.2 439.0-18.6% Other Current Assets 37.8 27.4 38.0% Value of forward contracts 57.7 - Cash and Bank Deposits 160.8 - Total Current Assets 837.1 723.5 15.7% TOTAL ASSETS 1,786.4 1,692.1 5.6% Total Equity 1,410.9 1,147.2 23.0% Provisions, commitments, deferred tax 45.0 26.9 67.3% Long term liabilities - bank - 42.3 Trade Creditors 96.2 117.9-18.4% Taxes, VAT and national insurance 94.8 80.0 18.5% Value of forward contracts - 4.5 Short term liabilities - bank - 48.8 3. kvartal Other current liabilities 139.5 224.5-37.9% Total Liabilities 375.5 544.9-31.0% TOTAL EQUITY AND LIABILITIES 1,786.4 1,692.1 5.6%
EQUITY Q3/09 Q3/08 2008 Result after taxes and before other comprehensive income 204.6 224.6 347.6 Other comprehensiv income: Actuarial gains on defined benefit plans - - -4.8 Change in deferred tax pensions - - 1.3 Change in value cash-flow hedging 354.7-91.6-384.0 Change in deferred tax cash flow hedging -99.3 25.6 107.5 Translation differences 0.1-0.6 11.5 Translation differences net financing subsidiaries -33.0-48.9 Change in deferred tax net financing subsidiaries 9.2 - -13.7 Total other comprehensive income 231.7-66.6-233.3 Total comprehensive income 436.3 158.0 114.3 Equity at the beginning of the period 1,103.5 1,265.4 1,265.4 Total comprehensive income 436.3 158.0 114.3 Dividend paid out -128.9-276.2-276.2 Equity at the end og the period 1,243.9 1,118.6 1,103.5 23
Development in cash-flow and bank deposits (Mill.NOK) YTD/09 YTD/08 2008 2007 Net cash flow from: Operating activities 255.3 156.3 405.3 331,6 Investing activities -62.5-137.1-188.1-186.7 Financing activities -181.2-276.2-276.2-261.2 Net change in cash and cash equivalents 11.6-257.0-59.0-116.4 Cash and cash equivalents at the beginning of period 149.2 208.2 208.2 324.6 Cash and cash equivalents at the end of period 160.8-48.8 149.2 208.2 24
Development in Total Capital, Net-working Capital and Equity (mill. NOK) Q3/09 Q3/08 2008 2007 Total capital 1,786.4 1,692.1 1,919.8 1,815.6 Net-working capital* 448.9 252.3 381.7 315.0 Equity 1,410.9 1,147.2 1,103.5 1,265.4 Equity* 1,369.4 1,150.5 1,317.4 1,202.8 Equity ratio 79.0% 67.8% 57.5% 69.7% Equity ratio* 79.2% 68.2% 81.2% 69.6% *Excluded the market value of forward contracts. 25
New studio concept: 26
Development in operating revenue per market year to date (Mill. NOK) 0 100 200 300 400 500 600 Norway Sweden Denmark Finland Central Europe Southern Europe UK USA Japan 33,2 39,4 79,6 101,0 17,0 18,4 78,5 61,9 151,5 185,1 294,7 263,1 258,9 288,6 347,8 395,0 2009 2008 533,6 488,2 Others - Export 47,2 55,7 Contract 66,5 31,9 27
Development in operating revenues per market quarterly data (Mill. NOK) 0 50 100 150 200 Norway Sweden Denmark Finland Central Europe Southern Europe UK USA Japan 3,4 5,4 11,0 12,6 25,8 30,7 31,1 26,4 53,9 61,5 75,6 81,6 114,3 107,9 Q3/09 Q3/08 164,1 138,3 125,4 140,0 Others - Export 21,0 19,8 Contract 19,8 10,6 28
Development in operating revenues per market year to date (Mill. NOK) Changes 08 09 YTD/09 YTD/08 YTD/07 YTD/06 Norway 13.2% 294.7 263.1 281.3 261.0 Sweden -15.8% 33.2 39.4 45.3 46.2 Denmark -21.1% 79.6 101.0 97.1 81.2 Finland -7.7% 17.0 18.4 26.8 24.5 Central - Europe 9.3% 533.6 488.2 420.9 445.1 Southern - Europe -10.3% 258.9 288.6 285.6 261.0 UK -18.1% 151.5 185.1 183.6 175.1 USA -11.9% 347.8 395.0 400.6 426.6 Japan 26.9% 78.5 61.9 66.6 62.5 Others - Export -15.1% 47.2 55.7 49.5 36.3 Contract 107.8% 66.5 31.9 29.2 24.9 Total -0.6% 1,908.5 1,928.2 1,886.5 1,844.4 29
Coming events: 15 February 2010: Announcement of Q4/09 result 16 February 2010: Presentation of Q4/09 result 11 May 2010: Announcement of Q1/10 result and Ordinary General Assembly 12 May 2010: Presentation of Q1/10 result 16 August 2010: Announcement of Q2/10 result 17 August 2010: Presentation of Q2/10 result 11 November 2010: Announcement of Q3/10 result 12 November 2010: Presentation of Q3/10 result 30
Questions? 31
Largest shareholders (29.10.2009) 1. Nordstjernan AB SWE 11.73% 2. State Street Bank USA 8.77% 3. Folketrygdfondet NOR 8.40% 4. JP Morgan Chase Bank GBR 7.19% 5. Orkla ASA NOR 5.14% 6. Pareto Aksje Norge NOR 4.72% 7. Skandinaviska Enskilda SWE 4.03% 8. Handelsbanken Helsinki FIN 3.37% 9. Berit Ekornes Unhjem NOR 2.89% 10. Oslo Pensjonsforsikring NOR 2.88% Other shareholders approx. 2,742 40.88% Proportion: Norwegian shareholders 43.3% Foreign shareholders 56.7% 32
Board of Directors Group Management IR-Contacts Olav Kjell Holtan - Chairman Kjersti Kleven Vice Chairman Gry Hege Sølsnes Stian Ekornes Nora Förisdal Larssen Employee Representatives: Arnstein Johannesen Tone Helen Hanken Edvin Haugen CEO: Øyvind Tørlen oyvind.torlen@ekornes.no Phone: +47 70 25 52 22 Mobile: +47 97 11 19 79 CFO: Robert Svendsen robert.svendsen@ekornes.no Phone: +47 70 25 52 13 Mobile: +47 91 89 50 24 33