1. The Fourth Quarter and the Full Year Report
for the period of 1 Sept 2005 to 31 Aug 2006
2 October 2006
Christian W. Jansson
CEO
Håkan Westin
CFO
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2. Disclaimer
• These materials may not be copied, published, distributed or transmitted to
third parties
• These materials may contain forward-looking statements. If so, such
statements are based on our current expectations and are subject to risks
and uncertainties that could negatively affect our business. Please read our
earnings report and our most recent annual report for a better understanding
of these risks and uncertainties.
• These materials do not constitute or form part of any offer or invitation to sell
or issue, or any solicitation of any offer to purchase or subscribe for, any
securities, nor shall part, or all, of these materials or their distribution form
the basis of, or be relied on in connection with, any contract or investment
decision in relation to any securities. These materials and the information
contained herein are no an offer of securities for sale in the United States
and are not for publication or distribution to persons in the United States.
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3. Agenda
I Business Highlights
II Results Q4
III Results 2005/2006
IIII Key Conclusions
IV Recent Activities
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4. Business Highlights I
Business Highlights
• 2005/2006 – the best year so far.
– Improved gross margin.
– Successful purchasing.
– Good inventory control.
• Continued good general retail demand.
• Store expansion program on track.
– Two new stores during Q4.
– Total 20 new stores and two closures in 05/06.
– Current network of 260 stores and 26 contracts
for new store openings.
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5. Results Q4 II
Financial Highlights Q4
• Sales increased by 2.3 percent to MSEK 1 010 (987).
• Gross margin improved to 63.3 (60.5) percent.
• Operating profit increased to MSEK 173 (119) of which
MSEK 26 was an one-off item.
• Operating margin improved to 17.1 (12.1) percent.
• Profit after taxes was MSEK 116 (63), corresponding to
SEK 1.54 (0.84) per share.
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6. Results Q4 II
Financial Highlights Q4
2004/2005 vs. 2005/2006
-2,0% +5,3% -1,0% 2,3%
1 100
53 -10
-7 1 010
1 000 987
-20 • FX impact was negative.
• Net new stores largest growth
900 contributor with 5.3 percent.
• LFL -1.0 percent impacted by
SEKm
800
discontinued cosmetics sales
in Norway MSEK 0 (20).
700
• LFL excluding cosmetics
600 was +1.1 percent.
500
Q4 FX Net LFL Q4
04/05 effect new growth 05/06
MSEK stores
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7. Results Q4 II
Profitability Drivers Q4
2004/2005 vs. 2005/2006
MSEK 05/06 04/05
Gross profit 639 597
Gross margin 63,3% 60,5% • Strong gross margin, even
when excluding one-off item
Selling expenses -431 -447
of MSEK 26.
% of sales 42,7% 45,3%
Admin expenses -35 -31 • Selling expenses positively
% of sales 3,5% 3,1% effected by reallocated
pension costs of MSEK 14.
EBITDA 223 159
EBITDA margin 22,1% 16,1%
Operating profit 173 119
Operating margin 17,1% 12,1%
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8. Results Q4 II
Income Statement Q4
MSEK 05/06 04/05
Net sales 1 010 987
Cost of goods sold -371 -390
Gross profit 639 597
Selling expenses -431 -447
Administrative expenses -35 -31
Operating profit 173 119
Financial income 0 3
Financial expense -12 -48
Profit before tax 161 74
Tax expense -45 -11
Net profit 116 63
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9. Results 2005/2006 III
II
Financial Highlights
Full Year
• Sales increased by 6.9 percent to MSEK 4 217 (3 945).
• Gross margin improved to 60.2 (58.6) percent.
• Operating profit increased to MSEK 530 (403) of which
MSEK 22 was an one-off item.
• Operating margin improved to 12.6 (10.2) percent.
• Profit after taxes was MSEK 302 (264), corresponding to
SEK 4.02 (3.52) per share.
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10. Results 2005/2006 III
II
Financial Highlights Full Year
2004/2005 vs. 2005/2006
+2,2% +5,0% -0,3% 6,9%
4 800
4 217 • Favourable FX impact, mainly
4 400 197 -7
-12 due to strong NOK.
3 945 87
4 000 • Net new stores largest growth
contributor with 5.0 percent.
3 600
SEKm
• LFL -0.3 percent impacted by
3 200 discontinued cosmetics sales
in Norway MSEK 38 (97).
2 800
• LFL excluding cosmetics
2 400 was +1.2 percent.
2 000
FY FX Net LFL FY
04/05 effect new growth 05/06
stores
MSEK
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11. Results 2005/2006 III
II
Sales Breakdown Full Year
2004/2005 vs. 2005/2006
Growth
MSEK 05/06 04/05 SEK Loc. cur.
Sweden 2 365 2 267 4.3% 4.3%
Norway 1 237 1 132 9.2% 3.7%
Finland 473 429 10.3% 8.9%
Poland 142 117 21.2% 11.2%
Total 4 217 3 945 6.9%
Poland
Finland 3(3)%
12(11)%
Sweden
Norway 56(57)%
29(29)%
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12. Results 2005/2006 III
II
Profitability Drivers Full Year
2004/2005 vs. 2005/2006
MSEK 05/06 04/05
Gross profit 2 540 2 310
Gross margin 60,2% 58,6% • Strong development of
gross margin.
Selling expenses -1 863 -1 781
% of sales 44,2% 45,1%
• Selling expenses in percent
Admin expenses -147 -126 reduced due to economies
% of sales 3,5% 3,2% of scale in increased
number of stores.
EBITDA 707 555
EBITDA margin 16,8% 14,1%
Operating profit 530 403
Operating margin 12,6% 10,2%
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13. Results 2005/2006 III
II
Income Statement Full Year
MSEK 05/06 04/05
Net sales 4 217 3 945
Cost of goods sold -1 677 -1 635
Gross profit 2 540 2 310
Selling expenses -1 863 -1 781
Administrative expenses -147 -126
Operating profit 530 403
Financial income 2 6
Financial expense -113 -109
Profit before tax 419 300
Tax expense -117 -36
Net profit 302 264
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14. Results 2005/2006 III
II
Cash Flow
Q4 Full Year
MSEK 05/06 05/06
Cash flow from operations before working capital changes 180 474
Changes in working capital -63 -7
Cash flow from operating activities 117 481
Cash flow investing activities -44 -225
Cash flow after investments 73 256
Cash flow from financing activities -39 45
Dividend 0 -169
Change in revolving credit -70 -142
Net cash flow for the period -36 -10
Cash and bank balances at beginning of period 109 83
Cash and bank balances at end of period 73 73
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15. Key Conclusions IIII
Key Conclusions and Outlook
• Best year so far
• First class growth margin
• Excellent inventory control
• Weak sales
Focus going forward
• More emphasis on overall sales
• Continue new store expansion program
• Maintain gross margin
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16. Recent Activities IV
Recent Activity
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17. We don’t believe in selling a lifestyle.
You have one already.
We don’t believe in expensive collections for an exclusive few.
We believe in fashion that suits you.
We don’t believe in eternal youth, however we believe that
people mature, grow wiser and even more beautiful.
Take it as a compliment.
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