PERIOD 1 OCTOBER–31 DECEMBER 2013
· Sales amounted to
PERIODEN 1 JANUARI–31 DECEMBER 2013
· Sales amounted to
FOURTH QUARTER 2013 The turning point is approaching – it is my conclusion after the fourth quarter – but we need more inventory! Sales dropped ”only” by 3% during the quarter, which also ended with an increase in December. How can we be satisfied with that? The explanation is partly because I am convinced that we would have had higher growth if our stock situation had been better, and partly due to the fact that we had the mildest weather I can remember for a fourth quarter, which hit sales of winter products hard, in particular, Sports & Leisure. Our inventory, which I wrote about in my last CEO comments, will now gradually start to increase from a low level of 1,449 MSEK at year-end. Profit of 99.2 MSEK before tax is clearly acceptable, given the fact that we increased sales and marketing activities at the end of the quarter as well as commenced our recruitment of more salesmen, with increased costs as a result and partly in view of the mild winter and low inventory levels.
FULL YEAR 2013 I’m not happy with sales of 4,047 MSEK, but we know what went wrong and we will correct it as soon as possible. Nor am I happy with the profit of 234.5 MSEK pre-tax, but it will be considerably better going forward. The balance sheet is a record high, which is good considering that we are now going to create growth. However, the balance sheet is almost too strong for the type of business that New Wave is in, where it’s easy to create a positive cash flow when needed. An equity ratio of 49.8% and an interest coverage ratio of 4.7 times, means that we are financially very strong.
THE FUTURE I welcome 2014 and 2015 with a strong belief that we will see growth from the third quarter, maybe even earlier. Inventories will gradually increase to cope with growth. Growth for me means both sales and earnings. I feel a degree of uncertainty for this in terms of the first half year, but nevertheless more certain that the second half will show growth - and this on its own merits and not through cyclical fluctuations. Otherwise, we are well positioned for expansion, not only due to a strong balance sheet, but also because we have a management that is both better and more committed than ever. Neither I nor my manage-ment has had such positive confidence for nearly six years. Now the fun begins again, after several years which are comparable with treading water – pedaling and pedaling but getting nowhere. Here we go! Now it’s full steam ahead – no standing still.
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CFO Lars JÖnsson Phone: 031–712 89 12 E-mail: firstname.lastname@example.org
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