The quarter in summary

  • Doro's net sales amounted to SEK 409.9 million (443.2), a decrease of 7.5 percent.
  • Net sales for business area Doro Care were SEK 140.5 million (124.2), an increase of 13.1 percent and for business area Doro Phones were SEK 269.4 million (319.0), a decrease of 15.5 percent.
  • Gross margin increased to 37.4 percent (32.4). For Doro Care, the gross margin decreased to 40.2 percent (40.8) and for Doro Phones the gross margin increased to 36.0 percent (29.1).
  • EBITDA amounted to SEK 66.9 million (53.2), an increase of 25.8 percent.
  • Operating profit (EBIT) amounted to SEK 38.4 million (25.0) corresponding to an operating margin of 9.4 percent (5.6).
  • Profit after tax for the period was SEK 27.2 million (18.7) and profit per share was SEK 1.13 (0.79).
  • Free cash flow before acquisitions was SEK -33.8 million (145.1).

January - September in summary

  • Doro's net sales amounted to SEK 1,153.5 million (1,199.7), a decrease of 3.9 percent.
  • Net sales for business area Doro Care were SEK 425.1 million (379.4), an increase of 12.0 percent and for business area Doro Phones were SEK 728.4 million (820.3), a decrease of 11.2 percent.
  • Gross margin increased to 37.5 percent (33.5). For Doro Care, the gross margin decreased to 41.0 percent (42.2) and for Doro Phones the gross margin increased to 35.4 percent (29.5).
  • EBITDA amounted to SEK 166.4 million (134.9), an increase of 23.4 percent.
  • Operating profit (EBIT) amounted to SEK 87.6 million (54.7), excluding restructuring costs and costs for the listing of business area Doro Care of SEK 10.3 million, corresponding to an operating margin of 7.6 percent (4.6). Including restructuring costs and costs for the listing, EBIT amounted to SEK 77.3 million (48.0) with an operating margin of 6.7 percent (4.0).
  • Profit after tax for the period was SEK 59.0 million (29.9) and profit per share was SEK 2.46 (1.26).
  • Free cash flow before acquisitions was SEK -76.5 million (152.5).

Message from the CEO

During the third quarter, the market has started to return to a more normal position and our sales have increased compared to the previous quarter. Doro Care have continued to deliver growth and gained new market shares in Europe. During the quarter, Doro Phones defended its market leading position and we also see a positive recovery in Germany, after the recent restructuring we carried out in the region.
We have during the quarter delivered an improved operating profit of SEK 38.4 million (25.0) adjusted for restructuring costs and costs for the listing of business area Doro Care. This is an improvement of 54 percent compared to the same quarter last year and an improvement to the previous quarter. The improved operating profit is mainly an effect of lower operating costs, due to the previously implemented restructuring program within Doro Phones. During the quarter, Doro Care performed below expectations with lower profitability, which can partly be explained by non-recurring costs in Norway of approximately SEK 5 million and partly by higher costs in our alarm receiving centres and continued high component costs. We are expected to see improved profitability in the coming quarters, and we work continuously to improve the efficiency in our service delivery.
During the quarter, we made two new acquisitions that further strengthened our Doro Care business. In line with our strategy, we have expanded and extended our geographical presence through the acquisition of Dutch Innocom. The Dutch market is an attractive market that we believe has great potential. Innocom is one of three leading companies in technology enabled care in the Netherlands and will be a perfect addition to our current business. At the end of the quarter, we also made a small acquisition in the United Kingdom when we acquired the assets of Helpline from Bromford Housing. Through the acquisition of Helpline, we are involved in driving the digital shift forward, as it becomes increasingly difficult for smaller players like Helpline to implement the shift themselves. Both acquisitions are fully in line with our strategy of becoming the European market leader in technology enabled care, which we want to pursue through both organic and acquisition growth.
Doro Phones delivered strong margins and a strong operating profit during this quarter. The strong gross margin is mainly driven by an improved product and customer mix as well as a positive currency effect. It is with great satisfaction that we see that, unlike many others, we have been able to continue to supply and sell products despite the great challenges that currently exist in component availability and logistics.
The strategy for the business area going forward will be to continue to consolidate its position as the market leader for senior phones in Europe, but also to broaden the offering to new product areas. Doro intends to continue to make new technology available to seniors, by constantly working closely and developing new products for the senior market. We also want to initiate new strategic collaborations and implement smart acquisitions. Thereby continuing to facilitate the use of new technology and stimulate the senior's interest and curiosity for technology going forward.
The implementation of our long-term strategies for each business area is fully in progress, at the same time we work daily to deliver excellent quality in the entire service delivery, as well as in our products. The work aims to create the best possible conditions for both business areas, ahead of the planned separate listing. The ambition to complete the listing at the end of the quarter remains and we look forward to developing both businesses and reach their full potential as independent companies.

Carl-Johan Zetterberg Boudrie, President and CEO

WEBCAST

A webcast conference call will be held on Friday 22 October at 9.00 am (CEST) when President and CEO Carl-Johan Zetterberg Boudrie will present the report. The webcast is accessed at https://tv.streamfabriken.com/doro-q3-2021. The presentation material is available on Doro's financial website http://www.doro.com/corporate.

Telephone numbers:
Sweden: +46 8 50 55 83 51
United Kingdom: +44 33 33 00 92 62
USA: +1 63 19 13 14 22 (PIN 97638173#)
France: +33 170 75 07 36

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DORO AB published this content on 22 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 October 2021 06:03:02 UTC.