PATRIK ANDERSSON, PRESIDENT AND CEO:
GARO EXCEEDS SEK ONE BILLION IN NET SALES AND LAUNCHES IN-HOUSE FASTCHARGER
After a highly active year in many fields, GARO achieved annual net sales in excess of SEK 1 billion for the first time, corresponding to an increase of 12% compared with 2018. The growth was well balanced between Sweden and Other markets business areas and was driven by strong growth in our largest product area Electrical distribution products where we once again captured market shares. We also saw strong growth in our fastest growing product area E-mobility with a healthy 43%. We met our profitability goals with an operating margin exceeding 10% with an outcome of 11.2% (12.6) despite increased product and market investments primarily in the E-mobility product area. Profit per share improved compared with the previous year and amounted to SEK 8.57 (8.27). The Board proposes a dividend of 4.20 (4.00) per share.
Net sales for the fourth quarter of 2019 increased 4%. The market was reticent mainly within in the product areas Electrical distribution products and E-mobility during the quarter. For Electrical distribution products the lower sales was a result of the mild weather negatively affecting sales of engine heaters and heating fans. Growth in the E-mobility product area was negatively affected by by fewer sold DC chargers (fast chargers) compared to previous year. For DC chargers a significant portion of sales occur through large procurements and the timing of sales from those orders can vary resulting in higher volatility year-on-year.
GARO strengthened its presence in the UK during the quarter by opening a local subsidiary with the intention of establishing its range in Electrical distribution products and E-mobility. The UK market is one of the largest in Europe with over 250,000 rechargeable cars on the roads, and high political aspirations to transform the vehicle fleet to be electric driven.
EBIT amounted to MSEK 35.9 (37.5) in the fourth quarter of 2019, corresponding to an EBIT margin of 12.9% (14.0), with earnings affected by costs relating to the creation of the subsidiary in the UK and product development in several of our product areas.
In the market for E-mobility we see a strong trend with further expansion of the charging infrastructure in all markets. Demand for construction-related products in Sweden remains favorable but is expected to slow in 2020 in line with fewer construction starts. However, the important renovation sector has been deemed stable. The trend in other markets served by GARO is expected to remain favorable. All in all, GARO has a positive view of market conditions, mainly driven by the continued expansion of charging infrastructure.
For further information, please contact:
Patrik Andersson, President and CEO: +46 (0)76 148 44 44
Helena Claesson, CFO: +46 (0)70 676 07 50
This information is such information that GARO aktiebolag is obligated to publish in accordance with the EU Market Abuse Regulation. The information was published by the abovementioned contact persons on February 18, 2020, at 07.30 CEST.
GARO develops, manufactures and supplies innovative products and systems for the electrical installations market under its own brand. With a focus on user-friendliness, sustainability and design, GARO takes responsibility for the entire life cycle of its product areas within Electrical distribution products, Project business, Temporary electric installations and E-mobility.
At year-end, the Group had 420 employees with operations in Sweden, Norway, Finland, Ireland, Poland and Great Britain and Northern Ireland. Sales are divided into GARO Sweden and GARO Other markets. The head office is in Gnosjö, Sweden. Production units are located in Gnosjö and Värnamo, Sweden, and in Szczecin, Poland. GARO is listed on Nasdaq Stockholm, Mid Cap. The business concept is "with a focus on innovation, sustainability and design, GARO provides profitable complete solutions for the electrical industry."
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