Proffice Interim report January-March 2014

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Proffice (STO:PROEB):

Interim report January-March 2014

PROFFICE DOUBLES OPERATING PROFIT

Q1 2014 year-on-year comparison

• Revenue decreased 6 per cent to SEK 996 million (1,062)

• EBITA and operating profit increased 100 per cent to SEK 20 million (10)

• EBITA and operating margin stood at 2.0 per cent (0.9)

• Basic earnings per share totalled SEK 0.19 (0.19)

• Cash flow from operating activities totalled SEK -1 million (44)

Financial overview

  First quarter   Change   Full year
Group 2014   2013 quarter 2013
Revenue, SEK million 996 1,062 -6% 4,318
EBITA and operating profit, SEK million 20 10 100% 125
EBITA and operating margin, % 2 0.9 - 2.9
Profit after tax, SEK million 13 13 0% 104
Basic earnings per share, SEK 0.19 0.19 0% 1.52
Diluted earnings per share, SEK 0.19 0.19 0% 1.52
Cash flow from operating activities, SEK million -1 44 - 207
Cash flow from operating activities per share, SEK -0.01 0.64 - 3.03
Basic equity per share, SEK 8.63 7.4 17% 8.37
Return on equity, % 19 12.6 - 19.2
CEO comments

CEO comments

Proffice doubles operating profit

After just over a quarter as CEO and president, I can state that Proffice is a profitable company with great potential. Compared to last year’s first quarter, operating profit doubled to SEK 20 million (10).

Happier customers

We think we discern a certain optimism in the market, which is demonstrated especially by the fact that a number of customers in both Sweden and Norway chose to employ many of the temporary consultants who were contracted from Proffice. This will have a negative effect on our earnings in the short term, but it is also proof that customers are satisfied with our matching of consultants, which hopefully will build trust and increase volume in the long term.

When I visit my new colleagues across the Nordic region, I see great commitment to our customers. Proof of our customer’s appreciation is that the customer satisfaction index survey (CSI) conducted during the first quarter broke the record once again.

Simpler, clearer structure

Revenue is not growing, however, partly due to the fact that some major customers are placing fewer orders. In order to strengthen and energize the sales process and raise internal efficiency, I have initiated an organizational change that will take effect 1 June. The organizational structure will be simpler and clearer, and Group management will be reinforced with the heads of the four major business units and the head of Group Sales.

In line with Proffice’s main strategy – product leadership through specialization – we are establishing a company called Dfind Science & Engineering. This entails combining the existing operations of Proffice Life Science and Dfind Engineering and further developing them to add new services and new markets.

A non-recurring cost for this organizational change will be in the range of SEK 10-15 million and will affect earnings in the second and third quarters. Annual savings from 2015 are expected to be SEK 5-10 million.

Strengthening for the future

The new organizational structure will enhance the Group’s focus on sales. In the first and second quarters we will develop our future sales strategy and will implement it in the fourth quarter. Weak sales to new customers have affected consolidated revenue for some time, but our ambition to grow faster than the market stands firm.

The organizational changes coupled with additional investments in Group infrastructure and IT systems of SEK 20-25 million per year in 2014 and 2015 convince me that we can improve our ability to respond more quickly to the market. Consequently, Proffice will further strengthen its position in order to become the most successful staffing company in the Nordics.

Henrik Höjsgaard

President and CEO

This is a translation from Swedish. In the event of any discrepancies between the Swedish and the translation, the former shall have precedence.

Proffice is the specialised flexible staffing company with more than 10,000 employees in the Nordic region. We provide temporary staffing, recruitment services, and outplacement. Proffice is listed on the NASDAQ OMX Stockholm, Mid Cap. www.proffice.com

Information in this interim report is such that Proffice AB (publ) is obligated to disclose it pursuant to the Swedish Securities Markets Act. The information was released for publication on 22 May 2014 at 8 am CET.

This information was brought to you by Cision http://news.cision.com

Contacts

Proffice
Henrik Höjsgaard
President and CEO
Telephone +46 8 787 17 00
henrik.hojsgaard@proffice.com
or
Benno Eliasson, CFO
Telephone +46 8 787 17 00
benno.eliasson@proffice.com

Sharing

Contacts

Proffice
Henrik Höjsgaard
President and CEO
Telephone +46 8 787 17 00
henrik.hojsgaard@proffice.com
or
Benno Eliasson, CFO
Telephone +46 8 787 17 00
benno.eliasson@proffice.com