YEAR-END REPORT 2022 NEW WAVE GROUP AB
PERIOD 1 OCTOBER – 31 DECEMBER 2022
- Net sales amounted to SEK 2,815,1 million, which was 22% higher than last year (SEK 2,306.7 million). Currency changes affected net sales positively by 8% and acquired business by 8%.
- Operating result amounted to SEK 547.2 (403.3) million.
- Result for the period amounted to SEK 446.2 (308.5) million.
- Earnings per share amounted to SEK 6.73 (4.61).
- Cash flow from operating activities amounted to SEK -232.9 (413.3) million.
PERIOD 1 JANUARY – 31 DECEMBER 2022
- Net sales amounted to SEK 8,843.6 million, which was 32% higher than last year (SEK 6,718.6 million). Currency changes affected net sales positively by 8% and acquired business by 4%.
- Operating result amounted to SEK 1,505.1 (1,005.9) million.
- Result for the period amounted to SEK 1,168.8 (760.0) million.
- Earnings per share amounted to SEK 17.62 (11.46).
- Cash flow from operating activities amounted to SEK -360.0 (1,207.4) million.
- Equity ratio amounted to 53.8 (59.6) %.
- Net debt to equity ratio amounted to 39.5 (23.4) %.
ANNUAL GENERAL MEETING
The board proposes that the general meeting decide on:
- A dividend of SEK 6.50 per share, with half-yearly payments of SEK 3.25 per share each (before the split).
- 2:1 split, meaning that an existing share is divided into two shares.
CEO COMMENTS
October - December
I am extremely delighted to announce our continued success for the fourth quarter and am very grateful to the entire staff who continue to perform incredibly well!
Net sales increased in the quarter by SEK 508.4 million, from SEK 2,306.7 to SEK 2,815.1 million. Of our three segments, Corporate and Sports & Leisure excelled with growth of 35% and 25% respectively. Our third segment, Gifts & Home Furnishings, decreased by 19%, largely due to the companies in Sweden, which is the dominant market, during 2020 and 2021 had an extra tax deduction for gifts of SEK 2,000 per employee during the COVID pandemic. This extra deduction was removed in 2022, which was noted in last quarter’s report. Both sales channels had growth, promo increased by 28% and retail by 13%.
Operating result increased by SEK 143.9 million (36%), to SEK 547.2 million. This occurred despite the fact that Gifts & Home Furnishings decreased SEK 21.4 million compared to the previous year. The operating margin for the quarter was 19.4%, which is again a new all-time high.
We have continued with strong cost control, a solid gross profit margin and increased efficiency per employee.
The inventory has now reached our targeted level which ensures our ability to continue providing excellent service to our customers and therefore enabling continued growth.
Full Year 2022
2022 was our best year ever for both net sales and results. Net sales increased by SEK 2,125.0 million or 32% to SEK 8,843.6 million. Operating result increased by SEK 499.2 million and was SEK 1,505.1 million with an operating margin of 17.0%, which is the highest ever. It is remarkable that these great results were achieved during a year where the world saw much turbulence, including the war in Ukraine and the extended impacts of the COVID pandemic, especially in China. Later in the year, we encountered higher electricity costs, increased interest rates and high inflation in many markets. Despite these worldwide challenges, both of our sales channels increased, promo by 37% and retail by 24%. Of the segments, Gifts & Home Furnishings decreased 5%, while Corporate increased 40% and Sports & Leisure 35%.
Cash flow and balance sheet
We continue to have a very strong balance sheet with an equity ratio of 53.8%. We ended the year, with unused capacity in our bank line of SEK 1,245.8 million. We accomplished this while building the inventory to our targeted level; completing the acquisition of BTC; and growing accounts receivable to be in line with increased net sales. Our strong balance sheet not only provides security, but also enables continued organic growth such as acquisitions.
The future
Our company is well positioned for the future. With the highest operating margin ever last year, 17.0%, we have shown that we can not only meet, but exceed, our targets.
With high inflation, higher interest rates and energy prices, the future is likely to experience a weaker market. The company is in a great position to navigate the economic challenges with our strong brands, products, level of service and inventory levels compared to most competitors. This allows us the opportunity to execute our strategy of taking market shares and do acquisitions, for which our company has both the capacity and finances to do.
New Wave has gone from a local to a global company and as a result in 2023 our company will be traded on the OMX Stockholm Large Cap after clearing the OTC list, O list and Mid Cap.
It is our goal and responsibility to ensure that the future continues to be successful. We will therefore increase the investing in product development, marketing and new establishments. These investments will temporarily reduce our operating margin, but the goal is still to average at least 15% over the next few years and therefore better situate the company to maintain healthy growth for the next 10 years.
In summary we have built a fantastic platform with which to create an even larger and more successful company and I look to the future with great optimism! My sincere thanks to everyone for contributing to our success!
Torsten Jansson, CEO
FOR MORE INFORMATION, PLEASE CONTACT:
CEO and Group CEO
Torsten Jansson
Phone: +46 31–712 89 01
E-mail: [email protected]
Deputy CEO
Göran Härstedt
Phone: +46 (0) 70– 362 56 11
E-mail: [email protected]
CFO
Lars Jönsson
Phone: +46 31–712 89 12
E-mail: [email protected]
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 10, 2023.
If you want to sign up for, or unregister from, future messages from New Wave Group, please send an email to [email protected].