Interim report – Q1 2015/16

Matas A/S
Quarterly report

Interim report – Q1 2015/16

Company announcement no. 13, 2015/16

Allerød, 2015-08-28 08:08 CEST (GLOBE NEWSWIRE) -- 

Stable revenue – improved margins – unchanged strong market position

Q1 2015/16 revenue was DKK 826.5 million, down by 0.1% year on year. Revenue
was adversely affected primarily by low summer season sales, including, in
particular, sales of sun products and, to a lesser extent, by movements in
outstanding Club Matas points. The underlying like-for-like sales growth rate
in the stores was 0.4% in Q1 2015/16.  EBITA was DKK 137.7 million in Q1
2015/16 equivalent to an EBITA margin of 16.7%, up from 15.8% in the
year-earlier period. 

Statement by Terje List, Chief Executive Officer: “The Danish retail market
continues to be characterised by weak growth, which together with lower sales
of summer season products and the resulting lower traffic in the stores
resulted in revenue being at a lower-than-expected level. Nevertheless, we
generated a satisfactory profit in Q1 2015/16 and maintained our overall market
share, mostly thanks to our strong market position, good execution of our
strategy and tight cost management”. 

  -- Q1 2015/16 revenue was down by 0.1 % year on year to DKK 826.5 million.
     Like-for-like growth was 0.4%. Revenue was adversely affected by seasonal
     sales and movements in outstanding Club Matas points.
  -- Q1 2015/16 gross profit was DKK 386.0 million, equivalent to a gross margin
     of 46.7%, which was unchanged from Q1 2014/15.
  -- EBITA was DKK 137.7 million in Q1 2015/16 equivalent to an EBITA margin of
     16.7%, up from 15.8% in the year-earlier period.
  -- Profit after tax for the period was DKK 86.4 million, and adjusted profit
     after tax net of amortisation not related to software was DKK 100.9 million
     (Q1 2014/15: DKK 81.9 million).
  -- Cash generated from operations increased to DKK 199.5 million in Q1 2015/16
     (Q1 2014/15: DKK 183.9 million). Free cash flow was an inflow of DKK 177.5
     million (Q1 2014/15: an inflow of DKK 156.1 million).
  -- Net interest bearing debt was DKK 1,645.1 million at 30 June 2015,
     equivalent to 2.5x LTM EBITDA before exceptional items as compared to 2.4x
     at the end of Q1 2014/15.
  -- At the annual general meeting held on 24 June 2015, a resolution was passed
     to pay a dividend of 5.80 per share of DKK 2.50, equivalent to a total
     dividend of DKK 232 million, which amount is recognised in the cash flow
     statement for Q1 2015/16.
  -- Club Matas sustained the net membership growth in Q1 2015/16, retaining its
     position as the largest customer club in Denmark.
  -- Matas’s online store continued its high growth rate.
  -- Stylebox revenue continued to grow in Q1, and management remains confident
     about the potential to further develop the Stylebox concept.

Outlook for 2015/16

The financial targets for the Group for 2015/16 are unchanged:

  -- Revenue is expected to be around DKK 3.5 billion, assuming like-for-like
     growth of approximately 2%.
  -- The EBITA margin is expected to be at a level of between 17.0 and 17.5%.

The Danish retail market was challenging during the first quarter of the
current financial year, partly due to continuing reluctant consumer spending,
and partly due to an extraordinarily poor season for sales of summer-related
products, which are typically a major sales category during Matas’s first
quarter.  The guidance for 2015/16 is based on an assumption of unchanged
market conditions for the rest of the financial year, although sales of
seasonal products are expected to normalise. Moreover, it is expected that the
Group will be in a position to retain its overall market share.