Year-End Report 2021- New Wave Group AB
January - December
PERIOD 1 OCTOBER – 31 DECEMBER 2021
- Net sales amounted to SEK 2,306.7 million, which was 23 % (22 % in local currencies) higher than last year (SEK 1,873.2 million).
- Operating result amounted to SEK 403.3 (283.6) million.
- Result for the period amounted to SEK 308.5 (208.2) million.
- Earnings per share amounted to SEK 4.61 (3.13).
- Cash flow from operating activities amounted to SEK 413.3 (557.5) million.
PERIOD 1 JANUARY – 31 DECEMBER 2021
- Net sales amounted to SEK 6,718.6 million, which was 10 % (13 % in local currencies) higher than last year (SEK 6,098.8 million).
- Operating result amounted to SEK 1,005.9 (545.9) million.
- Result for the period amounted to SEK 760.0 (363.0) million.
- Earnings per share amounted to SEK 11.46 (5.51).
- Cash flow from operating activities amounted to SEK 1,207.4 (1,206.6) million.
- Equity ratio amounted to 59.6 (53.4) %.
- Net debt to equity ratio amounted to 23.4 (47.1) %.
DIVIDEND
The Board of Directors has decided to propose to the AGM a dividend of SEK 4.25 per share equal to SEK 282.0 million.
CEO comments
OCTOBER - DECEMBER
Fourth quarter yielded records in both earnings and net sales
I feel incredible joy and pride over both sales and operating result during the quarter and of course also for the full year 2021. The pandemic is not over and continues to be an impact on day-to-day business. Several countries received new restrictions during the fourth quarter and this development has continued at the beginning of 2022. This is having a negative effect on our sales in parts of the Group, and considering that background our results are even more fantastic.
Net sales during the quarter amounted to SEK 2,306.7 million, which is an increase from the previous year of SEK 433.5 million or 23%. It is also interesting that there is a growth of 14% against the fourth quarter of 2019, which was the last quarter before the great outbreak of the pandemic. The quarter for the year is also an all time high in terms of sales both for a fourth quarter but also the highest net sales for a single quarter.
Operating result was SEK 403.3 million, an increase of SEK 119.7 million or 42% compared to 2020 and the operating margin increased from 15.1% to 17.5% - all figures for the quarter are at an all time high. Compared with the 2019 quarter, operating result increased by SEK 163.0 million or 68% and the operating margin has been increased from 11.9% to 17.5%.
It is once again a pleasure to note that we have growth in all three segments. Gifts & Home Furnishings grew by 13%, Corporate by 18% and Sports & Leisure by as much as 35%. Our two sales channels also showed good growth, promo with 16% and retail with 36%. Given the negative effects of the pandemic, this is a very strong development.
FULL YEAR 2021
Despite the negative effects of the pandemic and reduced sales at the beginning of the year, we still increased net sales for the full year by SEK 619.8 million, a growth of 13% in local currencies. Of our three segments, Corporate was the hardest hit by the pandemic and decreased by 4%. Gifts & Home Furnishings grew by 16% despite several of the company’s operations in Kosta, such as hotels, restaurants and retail, being hit hard during parts of the year. Sports & Leisure showed growth throughout by 29%. Both our sales channels increased, promo by 2% and retail by 25%.
Operating result increased by SEK 460.0 million to SEK 1,005.9 million, an increase of 84% and it is incredibly exciting to pass SEK 1 billion in operating result. At the same time, net financial items decreased, which together means that we more than doubled the result for the year from SEK 363.0 million to SEK 760.0 million, an improvement of 109%. Having met our target this year of 15% operating margin is very gratifying and EBITDA now amounts to SEK 1,233.3 million. The Corporate segment increased its operating result by SEK 91.8 million to SEK 440.8 million, Sport & Leisure improved by as much as SEK 295.6 million to SEK 466.0 million and our formerly challenging Gifts & Home Furnishings business improved by SEK 72.6 million to SEK 99.1 million which actually means that the segment reaches an operating margin of 10.4%.
CASH FLOW AND BALANCE SHEET
Cash flow from operating activities amounted to SEK 1,207.4 million and cash flow after investing activities to SEK 1,093.2 million. The strong cash flow has further strengthened our already strong balance sheet. Net debt to credit institutions at the turn of the year was down to SEK 375.1 million and equity amounted to SEK 4,567.6 million and the equity ratio to 59.6%. These strong financial positions provide great opportunity going forward for both acquisitions and organic expansion, while also providing great security to the existing operations.
CRAFT'S FANTASTIC DEVELOPMENT CONTINUES
Craft’s preorders for the AW season increased by as much as 42%, breaking new records. We are pleased to see the growth is taking place in all markets and in all product segments. It is noteworthy that the more mature markets show very good growth, such as Sweden with 34% or Norway with as much as 71% and we are taking big steps forward in markets such as Spain, France, the USA and Canada.
OUR OTHER BRANDS
Thanks to Craft’s fantastic development, it would be easy to overlook our other strong brands. It is very gratifying that we actually have good growth in almost all brands in all segments. For example, Gifts & Home Furnishings had a growth of 16% during the year, despite the fact that several businesses such as retail, hotels, restaurants, etc. in Kosta were hit hard by the pandemic. Net sales increased in the segment due to the fact that Kosta Boda, Orrefors, Sagaform and others had very good growth. Cutter & Buck, ProJob, Jobman and others also had good growth.
THE FUTURE
We are entering 2022 stronger than ever and it is difficult not to be optimistic about the development we have had. Companies are developing well despite the pandemic. Sports & Leisure with Craft at the forefront with fantastic development opportunities and the previously challenged Gifts & Home Furnishings is demonstrating promising development.
We stand strong against our competitors in terms of product quality, design and function. We are far ahead of many competitors in terms of sustainability and we are among the absolute best in terms of service. Some areas of uncertainty remain in the market although it feels more stable than before. We need to increase our inventory to cope with the strong growth and there are still some disruptions in the production and logistics chains. However, these disturbances are becoming a lesser concern and it looks brighter going forward. Another is large price increases, for example on freight and energy. The ongoing pandemic is also a continuing challenge for several businesses with, for example, very high sick leave/absenteeism rates impacting day-to-day operations.
Overall, however, I am very optimistic going forward and believe we will achieve good and profitable growth. Of course, there may be individual quarters that may be weaker, but over time I am convinced of continued very good development.
Thank you all for a fantastic effort in 2021. Now we are building New Wave even stronger in 2022 and beyond.
Torsten Jansson, CEO
FOR MORE INFORMATION, PLEASE CONTACT:
CEO and Group CEO
Torsten Jansson
Phone: +46 31–712 89 01
E-mail: torsten.jansson@nwg.se
CFO
Lars Jönsson
Phone: +46 31–712 89 12
E-mail: lars.jonsson@nwg.se
This information is information that New Wave Group AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons detailed above, at 7.00 a.m. CET on February 10th, 2022.
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