Year-end report 2020
The fourth quarter marked a period of strong organic revenue growth for Accessibility, which together with the successful implementation of the Lift Up Program contributed to an improved adjusted EBITA margin.
Fourth quarter 2020
· Revenue amounted to MEUR 59.2 (61.9).
· Organic growth was 5.6%.
· The gross margin was 43.8% (39.4).
· Adjusted EBITA amounted to MEUR 7.9 (3.7), corresponding to a margin of 13.3% (6.0).
· EBIT totaled MEUR 6.1 (-8.2).
· Net profit for the period (including discontinued operations) amounted to MEUR 2.0 (-11.5).
· Earnings per share (including discontinued operations) before and after dilution amounted to EUR 0.03 (-0.20).
· Adjusted operating cash flow of MEUR 6.3 (6.0) and leverage of 1.4x.
· The Board of Directors proposes a dividend of EUR 0.07 (0.07) for 2020
Significant events after the end of the period
· On 27 January 2021, Savaria (Sweden) AB, a wholly owned subsidiary of Savaria Corporation, announced a public cash offer to Handicare’s shareholders to transfer their shares in Handicare to Savaria. Savaria is offering SEK 50 per Handicare share.
Outlook for 2021
· Covid-19 continues to make market development uncertain, and thus short-term demand is difficult to predict. However, with the finalization of the Lift Up Program, the company is confident in having established a solid platform for growth. Supported by the attractive underlying long-term growth fundamentals that characterize the Accessibility market, Handicare sees positively on the development for 2021 and estimates that the full year will be in line with the financial targets.
In the last quarter of 2020, we continued to see gradual market recovery and increased demand for our solutions within the Accessibility area. Simultaneously, we continued the implementation of the Lift Up Program, where we have been able to fully deliver on our commitments during the quarter. After finalizing the first phase in the third quarter, optimizing the workforce setup, the fourth quarter was dedicated to initiating a number of measures to secure strong long-term profitability. For the quarter, we report an organic growth of 5.6% (currency adjusted) and an EBITA margin of 13.3%.
Continued growth in Accessibility
Despite the challenging market environment, Handicare’s core business area, Accessibility, managed to outperform previous year’s results, with an organic revenue growth of 12.3%. We saw increased sales in all key stairlift markets, partly due to pent-up demand in for example France and Germany. Coming into the latter part of the quarter, Covid-19 led to increased local restrictions and lock downs across Europe. In comparison to when restrictions and lock downs were first implemented across Europe in April/May 2020, a significant difference this time has been that our dealers have been able to keep open, offering full services to the customers. By engaging in close cooperation with our partners, we have managed to show resilience, despite the impact of Covid-19.
Actions to improve profitability within Patient Handling North America show results
The three-step review of Patient Handling North America has proceeded according to plan, and we saw continued improved profitability for the business area also in the fourth quarter. However, revenues continue to be affected by local restrictions in light of Covid-19, which among other things causes limited access to health care facilities. The primary focus going forward is to finalise the ongoing review, which will enable further improved profitability.
Covid-19 continues to make market development uncertain, and thus short-term demand is difficult to predict. However, supported by the attractive underlying long-term growth fundamentals that characterize the Accessibility market and expected market recovery, we see positively on the development for the full year 2021 and estimate that the full year will be in line with our financial targets.
Furthermore, on January 27, the global accessibility company Savaria made a public offer for Handicare. The offer, which has an acceptance period estimated to run between 11 February and 4 March, does not interfere with our continued focus on growing and developing our business, making everyday life easier for people around the world.
In conclusion, leaving an extraordinary 2020 behind, we take with us experiences that none of us expected a year ago, and I want to thank our organization and partners for working through these challenging times. During my first month as CEO, I have been impressed over what the Handicare team has accomplished so far, and I look forward to seeing what opportunities lay ahead of us coming into 2021.
President and CEO
Auditors’ review report
This year-end report has not been reviewed by the company’s auditors
A telephone conference, hosted by Henrik Teiwik, President and CEO, and Pernilla Lindén, CFO, will be held at 09.00 a.m. CET on 4 February 2021. Please note that the date has been changed from previously 12 February 2021. To participate, please register in advance using the following link: http://emea.directeventreg.com/registration/7081108
A presentation will be available at www.handicaregroup.com/investors.
Dates for financial reports and Annual General Meeting:
Interim report January – March 2021 28 April 2021
Annual report week of 29 March 2021
The Annual General Meeting for 2021 will be held in Stockholm 6 May 2021
For more information, contact:
Pernilla Lindén, CFO & IR, Tel +46 708 775 832
This information is information that Handicare Group AB (publ) is required to disclose pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 8:00 a.m. CET on 4 February 2021.
To the extent this report contains forward-looking statements, these statements are based on the current expectations of Handicare’s Group management. Although management considers the expectations expressed in such forward-looking statements to be reasonable, there is no guarantee that these expectations will prove correct. Accordingly, actual future outcomes may differ significantly from those expressed in the forward-looking statements due to such factors as changed economic, market and competitive conditions, changes in regulatory requirements and other policy measures, and fluctuations in exchange rates.
Handicare offers solutions to increase the independence of disabled or elderly people, and to facilitate for their care providers and family. The offering encompasses a comprehensive range of curved and straight stairlifts, transfer, lifting and repositioning aids and vehicle adaptations. Handicare is a global company with sales in some 40 countries and is one of the market leaders in this field. The head office is in Stockholm, Sweden and manufacturing and assembly is located at four sites distributed across North America, Asia and Europe. In the twelve-month period to December 2020, revenue amounted to MEUR 205 and the adjusted EBITA margin was 8.4%. Employees amounted to approximately 940 and the share is listed on Nasdaq Stockholm. For more information, www.handicaregroup.com.