About Axis Communications Axis offers intelligent security solutions that enable a smarter, safer world. As the global market leader in network video, Axis is driving the industry by continually launching innovative network products based on an open platform - delivering high value to customers through a global partner network. Axis has long-term relationships with partners and provides them with knowledge and ground- breaking network products in existing and new markets. Axis has more than 1,600 dedicated employees in more than 40 countries around the world, supported by a network of over 65,000 partners across 179 countries. Founded in 1984, Axis is a Sweden-based company listed on NASDAQ OMX Stockholm under the ticker AXIS. For more information about Axis, please visit our website www.axis.com. Sales growth during the first quarter of 2014 was 15 percent in local currency. Due to lower than expected sales during the end of the period, the earnings trend was weaker than anticipated. Eastern Europe has been clearly affected by the unrest in Russia and Ukraine. Meanwhile, overall sales were impacted by a weaker performance than expected in the Americas region, particularly during the second part of the quarter. At a global level, we did not notice any significant change in inventory levels. We estimate that the underlying short-term demand is in line with the growth rate we saw during 2013. Our investments for future growth have continued at a high pace. It is thanks to these ambitious investments that we were able to present a large number of new solutions in various product categories during the quarter. A number of new network cameras were released and we have introduced an upgraded version of our software for medium-sized installations, AXIS Camera Station. The recruitment rate continued to be high in early 2014 and the number of employees increased by 81 people. Axis entered 2014 with a good basis for taking advantage of the opportunities offered by the market. We will continue to advance our offering for access control, to release new innovative network cameras and we have now also strengthened our offering for medium-sized installations. These investments clearly emphasise our ambition – to continue to develop new innovative solutions and strengthen our market-leading position. President’s comments Interim report January-March 2014 Ray Mauritsson President The first quarter > Net sales increased by 15 percent during the first quarter to SEK 1,129 M (982). Net sales increased by 15 percent in local currencies > Operating profit decreased to SEK 72 M (89), corresponding to an operating margin of 6.4 percent (9.1). > Profit after tax amounted to SEK 52 M (66). > Earnings per share amounted to SEK 0.75 (0.95)
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January-March 2014mb.cision.com/Main/968/9573482/236426.pdf · About Axis Communications Axis offers intelligent security solutions that enable a smarter, safer world. As the global
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About Axis Communications Axis offers intelligent security solutions that enable a smarter, safer world. As the global market leader in network video, Axis is driving the industry by continually launching innovative network products based on an open platform - delivering high value to customers through a global partner network. Axis has long-term relationships with partners and provides them with knowledge and ground-breaking network products in existing and new markets. Axis has more than 1,600 dedicated employees in more than 40 countries around the world, supported by a network of over 65,000 partners across 179 countries. Founded in 1984, Axis is a Sweden-based company listed on NASDAQ OMX Stockholm under the ticker AXIS. For more information about Axis, please visit our website www.axis.com.
Sales growth during the first quarter of 2014 was 15 percent in
local currency. Due to lower than expected sales during the end
of the period, the earnings trend was weaker than anticipated.
Eastern Europe has been clearly affected by the unrest in Russia
and Ukraine. Meanwhile, overall sales were impacted by a weaker
performance than expected in the Americas region, particularly
during the second part of the quarter. At a global level, we did
not notice any significant change in inventory levels. We estimate
that the underlying short-term demand is in line with the growth
rate we saw during 2013.
Our investments for future growth have continued at a high pace.
It is thanks to these ambitious investments that we were able
to present a large number of new solutions in various product
categories during the quarter. A number of new network cameras
were released and we have introduced an upgraded version of our
software for medium-sized installations, AXIS Camera Station.
The recruitment rate continued to be high in early 2014 and the
number of employees increased by 81 people.
Axis entered 2014 with a good basis for taking advantage of the
opportunities offered by the market. We will continue to advance
our offering for access control, to release new innovative network
cameras and we have now also strengthened our offering for
medium-sized installations. These investments clearly emphasise
our ambition – to continue to develop new innovative solutions
and strengthen our market-leading position.
President’s comments
Interim reportJanuary-March 2014
Ray Mauritsson President
The first quarter > Net sales increased by 15 percent during the first quarter to SEK 1,129 M (982). Net sales increased by 15 percent in local currencies
> Operating profit decreased to SEK 72 M (89), corresponding to an operating margin of 6.4 percent (9.1).
> Profit after tax amounted to SEK 52 M (66). > Earnings per share amounted to SEK 0.75 (0.95)
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Events during the first quarter A strong product portfolioDuring the period, a number of important changes have occurred in the offering of
network cameras in the Axis P series. A number of advanced additions to the existing
AXIS P33 Series were released as well as the new AXIS P32 Series, while strategic price
reductions were made in certain volume products. The changes have meant that the
offering in this camera segment has improved due to more advanced functionality and a
more competitive price level.
In January, Axis Q60-S PTZ dome network cameras were released featuring stainless
steel casings. The cameras are equipped with functionality for image stabilization and
for handling foggy environments and are ideal for marine installations, surveillance of
oil and gas sites and the chemical industry. The Axis M1145-L and Axis M1145 cameras
were launched in February and offer a cost-efficient solution for around-the-clock indoor
surveillance. The cameras are primarily targeted to end customers in the retail segment
as well as restaurants and hotels. In March, AXIS Camera Station 4.0 was introduced, an
improved version of Axis’ software for medium-sized installations. The software has an
entirely new user interface with a clear focus on easy use. AXIS Camera Station 4.0 also
enables easier and more efficient handling of camera views, rapid replay of incidents,
improved search functionality relating to recorded material and smooth integration with
Axis’ solution for access control.
Continued high recruitment rate During the period, the number of employees increased by 81 people to 1,708 in total. The
recruitment rate is still high and the organization is continuing to expand in order to meet
the increasing future demand. The work on strengthening the global partner network through
training and certification of existing as well as new partners is continuing.
A strong American organizationIn January, a reorganization of the American operations commenced with the
aim of boosting the local presence and further strengthening our position in the
market. By dividing the US into six regions with local offices, proximity will be
strengthened to distributors and partners and also to end customers. Each region
will have its own local resources for sales, support, marketing and training within
the Axis Academy framework. Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2012 2013 2014
Earnings per share for the period, SEK 0.75 0.95 6.89 6.70
Number of shares, average, thousands 69,461 69,461 69,461 69,461
*Net effects of changes in exchange rates in underlying receivables and liabilities in foreign currencies have impacted operating profit negatively by SEK 12 M (negatively by SEK 15 M) during the first quarter.
Consolidated statement of cash flows
(SEK M)Q1
2014Q1
2013Full-year
2013Q2 13 - Q1 14
12 monthsCash flow from operating activities before change in working capital
83.5 102.9 567.6 548.2
Change in working capital 30.4 -2.6 -90.1 -57.1
Cash flow from operating activities 113.9 100.3 477.5 491.1
Cash flow from investing activities -31.1 -31.8 -117.0 -116.3
Cash flow from financing activities -1.3 -141.3 -487.3 -347.3
Cash flow during the period 81.5 -72.8 -126.8 27.5Cash and cash equivalents at the start of the period 337.7 464.5 464.5 391.7
Cash and cash equivalents at the end of the period 419.2 391.7 337.7 419.2
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Consolidated balance sheet (SEK M) Mar 31, 2014 Mar 31, 2013 Dec 31, 2013Non-current assets 286.3 227.9 270.5
Inventories 676.7 516.1 636.8
Trade receivables* 428.0 385.6** 592.0
Other receivables 145.6 111.5 105.9
Cash and cash equivalents 419.2 391.7 337.7
Total 1,955.8 1,632.8 1,942.9
Equity 989.5 873.9 936.9
Non-current liabilities 181.7 143.3 163.5
Trade payables 402.9 288.4 439.1
Other current liabilities 381.7 327.2** 403.4
Total 1,955.8 1,632.8 1,942.9
*This item includes receivables from contract manufacturers of SEK 92.3 M.**Since Q4 2014, Axis has applied net accounting of trade receivables in cases where Axis’ counterparty in turn has claims on Axis in the form of accrued discounts connected to purchasing from Axis. For comparability between quarters, Q1 2013 has been recalculated and the effect of the net accounting is a reduction in trade receivables and other current liabilities of SEK 97.7 M.
Key ratios Q1
2014Q1
2013Full-year
2013Net sales growth (%) 15.0 11.4 12.7
Gross margin (%) 50.5 51.5 51.1
Operating margin (%) 6.4 9.1 13.6
Profit margin (%) 6.3 9.0 13.5
Depreciation/amortization (SEK M) * 57.2 51.0 55.4
Shareholders’ equity (SEK M) 990 874 937
Capital employed (SEK M) 1,038 814 984
Interest-bearing liabilities (SEK M) - - -
Net interest-bearing liabilities/net receivables (SEK M) ** 419 392 338
Total assets (SEK M) 1,956 1,633 1,943
Return on capital employed (%) * 61.6 64.7 64.8
Return on total assets (%) * 32.0 34.2 35.2
Return on equity (%) * 50.2 53.6 56.9
Interest coverage ratio (times) * 209.9 83.3 206.5
Equity/assets ratio (%) 50.6 53.5 48.2
Share of risk-bearing capital (%) 57.4 60.0 54.2
Capital turnover ratio (times) 4.8 4.7 4.8
Number of employees (average for the period) 1,680 1,449 1,532
Sales per employee (SEK M) * 2.9 3.0 3.1
Operating profit per employee (SEK M) * 0.4 0.4 0.4 *The key figures have been recalculated to rolling 12-month values where appropriate. **Refers to net of interest-bearing receivables and liabilities.
Per-share dataMar 31, 2014 Mar 31, 2013 Dec 31, 2013
Share price at end of period, SEK 221.60 169.50 223.80
Dividend, SEK 5.50* 5.00 5.00
P/E ratio 33** 27** 32
Earnings per share, SEK 0.75 0.95 6.89
Average number of shares, thousands 69,461 69,461 69,461
Number of outstanding shares, thousands 69,461 69,461 69,461
*Proposed dividend.**P/E ratio has been recalculated to rolling 12-month value.
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Parent Company income statement (SEK M) Q1
2014Q1
2013Full-year
2013Net sales 5.1 5.2 25.9
Gross profit 5.1 5.2 25.9
Administrative expenses -7.7 -7.9 -37.4
Operating profit -2.6 -2.7 -11.5
Result from participations in group companies - - 451.6
Interest income and similar profit/loss items 0.6 1.6 1.8
Interest expenses and similar profit/loss items -1.5 -1.3 -20.5
Profit before tax -3.5 -2.4 421.4
Change in tax allocation reserve - - -31.8
Tax - - -83.7
Net profit for the period -3.5 -2.4 305.9
Parent Company balance sheet(SEK M) Mar 31, 2014 Mar 31, 2013 Dec 31, 2013Non-current assets 9.6 12.0 10.2
Receivables from group companies 564.6 904.5 749.6
Trade receivables and other receivables 1.3 3.0 2.4
Tax receivables 13.9 19.8 15.1
Cash and cash equivalents 306.9 0.0 122.5
Total 896.3 939.3 899.8
Equity 380.2 422.7 383.7
Untaxed reserves 510.4 478.6 510.4
Liabilities to group companies 0.8 0.7 0.9
Current liabilities 4.9 37.3 4.8
Total 896.3 939.3 899.8
Quarterly dataInvoiced sales per product group (SEK ‘000)