BE Group Interim report January - September 2022
Third quarter
- Net sales increased by 10% to SEK 1,514 M (1,375)
- The underlying operating result amounted to SEK 67 M (193)
- The operating result amounted to SEK 40 M (219), including inventory losses of SEK -27 M (26)
- Result after tax amounted to SEK 26 M (175)
- Cash flow from operating activities amounted to SEK -183 M (6)
- Earnings per share amounted to SEK 2.05 (13.49)
- Lecor Stålteknik was divested on July 1
- The acquisition of Goodtech Solutions Manufacturing AB was completed with take-over on September 1
Statement from the CEO
The prevailing business environment has reduced demand during the third quarter, that also led to lower steel prices, which in turn pushed down the gross margin. For BE Group, this has meant a negative development of the operating result. However, net sales increased by 10% to SEK 1,514 million (1,375) compared to the previous year, but the underlying operating profit fell by 65% to SEK 67 million (193). Operating profit including inventory losses amounted to SEK 40 million (219).
The margin decrease was already seen in the second quarter and has subsequently continued. At the moment, this trend appears as if it will continue in the fourth quarter. However, the conditions are still good for 2022 to be a strong year in terms of earnings. For the first nine months, net sales amounted to SEK 5,403 M (3,878) and the operating result, including inventory gains and losses, amounted to SEK 537 M (463).
Steel price trend
The price decline that began in the second quarter continued into the third quarter as expected. The wave of hoarding in connection with Russia’s invasion of Ukraine was driven by concerns about problems with availability, which proved to be a smaller problem than feared. The result was inventory build-up throughout Europe. Prices have now leveled off.
Steel mills have carried out announced capacity reductions. If these lead to material shortages, prices can likely move quickly. An important task for BE Group is, now as always, to keep its ear very close to the ground.
Our focus
In a headwind, it’s important to stand with both feet firmly on the ground and to see things as they really are. Steel is steel and we are continuing to do business with our customers. The focus of the company is always on sales, working capital and expenses. Now we are increasing that focus.
The world will probably not end, which is why the thorough work continues to build a strong and stable company that, regardless of the economic situation, is better than before. The key words are sales culture, customer experience and digitalization!
Peter Andersson, President and CEO
For further information, please contact:
Peter Andersson, President and CEO
Tel: +46 706 53 76 55, email: peter.andersson@begroup.com
Christoffer Franzén, CFO
Tel: +46 705 46 90 05, email: christoffer.franzen@begroup.com
This information is information that BE Group AB (publ) 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 set out above, at 2:00 p.m. CET on October 19, 2022.
BE Group AB (publ), which is listed on the Nasdaq Stockholm exchange, is a trading and service company in steel, stainless steel and aluminium. BE Group offers efficient distribution and value-adding production services to customers primarily in the construction and manufacturing industries. In 2021, the Group reported sales of SEK 5.4 billion. BE Group has approximately 650 employees, with Sweden and Finland as its largest markets. The head office is located in Malmö, Sweden. Read more about BE Group at www.begroup.com.