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Beijer Ref Q2 2020

Second quarter

Net sales decreased by 16.5% in the second quarter compared to the same period last year and amounted to SEK 3,338M (3,996). Acquisition effects amounted to 2.6% (6.9%). Negative currency effects amounted to -1.3% (2.6%). Organic growth was negative at -17.8% (4.4%). The end of the quarter shows a recovery and sales on a par with the previous year.

The operating profit for the quarter amounted to SEK 241 M (373), a decrease of 35% compared with the same period last year. The operating margin amounted to 7.2% (9.3%). The main reason is the effects of Covid-19, but also to some extent lower prices for refrigerants.

Profit before tax was SEK 227M (359). Net financial items are in line with previous years despite increased borrowing in connection with the acquisition of ACD Trade at the beginning of the year.

Profit per share before and after dilution amounted to SEK 1.31 (2.08) and SEK 1.30 (2.06) respectively, which is a decrease of 37%.

Cash flow was positive during the quarter and cash flow from current operations amounts to SEK 327M (-45). Unutilised credits amount to SEK 913M (1,427). Beijer Ref has performed a procurement and will after the end of the quarter extend the outstanding credits that fall due in November 2020.

During the quarter, the group entered into a partnership with compressor manufacturer Bitzer in Australia and New Zealand; the group has previously entered into partnerships for Europe, Asia and Africa. Under the new agreement, Beijer Ref will be able to offer a complete range of Bitzer's product portfolio.

After the end of the quarter, Beijer Ref signed a new exclusive agreement with Carrier International Corporation until 2023 regarding the continued sale and distribution of Carrier's comfort cooling product lines on the European market.

First half 2020

Net sales decreased by 8.3% in the first half compared to the same period last year and amounted to SEK 6,816M (7,430). Acquisition effects amounted to 2.9% (12.4%). Negative currency effects amounted to -0.3% (3.3%). Organic growth was negative at -10.9% (5.8%).

The operating profit for the period amounted to SEK 438M (617), a decrease of 29% compared with the same period last year. The operating margin amounted to 6.4% (8.3%). The main reasons are the effects of Covid-19 and lower prices for refrigerants.

Profit before tax was SEK 409M (588). Net financial items are unchanged compared with previous years despite increased borrowing in connection with the acquisition of ACD Trade at the beginning of the year.

Profit per share before and after dilution amounted to SEK 2.37 (3.40) and SEK 2.35 (3.38) respectively, which is a decrease of 30%.

The acquisition of the wholesale company ACD Trade in Australia was completed in the first quarter of 2020. The company has annual sales of SEK 540M with 60 employees across 9 branches. The company is included in the consolidated accounts with effect from 1 February 2020.

Beijer Ref has been affected by Covid-19 since the middle of March. Measures have been taken in all parts of the business to fend off some of the effects. This has led to net savings amounting to approximately SEK 150M during the period and the total net savings for 2020 are estimated to be approximately SEK 200M. The assessment is that Covid-19 will have a smaller effect on the group's earnings for the remainder of 2020, but the situation is difficult to assess.

Comments by the CEO

Impact of Covid-19 in the second quarter

As expected, the effects of Covid-19 have had full impact in the second quarter, a period characterised by virtually completely closed markets. Lost sales during the first half of the year amount to approximately SEK 1 billion, of which SEK 700 M can be attributed to the second quarter, where April and the first half of May were particularly heavily affected by the effects of the Corona pandemic. Since then, we have been able to monitor week by week how the markets have gradually opened up and sales at the end of June were on a par with the corresponding period last year, which is a faster recovery than our previous estimates.

Covid-19 has undoubtedly been a severe test for Beijer Ref and the world at large and I am proud and grateful for how our organisation and employees have shown loyalty, drive and flexibility in a situation that has been extreme. It shows once again our strength as a global group. When we realised that the world was facing a pandemic, major cost adjustments were immediately performed. During the first half of the year, these measures resulted in a saving of approximately SEK 150 M. We are prepared and have planned for further savings, but are awaiting developments to see at what level the market stabilises during the third quarter.

Although the period has been very different from previous years, we see clear signs that our HVAC segment is growing ever stronger. This is not only in the current year; if we look back, we can see several consecutive years in which air conditioning has seen increasing sales growth. We are seeing structural changes in the market, which means that air conditioning has in many respects gone from being something that was previously regarded as a luxury, but which is now increasingly regarded as a general everyday need. This becomes particularly clear during the summer months, even this year. It is therefore gratifying that we have concluded a new exclusivity agreement with Carrier for comfort cooling. During the period, we also signed an agreement with the compressor manufacturer Bitzer for the distribution of their products in Australia and New Zealand. Both partnerships strengthen Beijer Ref's global growth and presence.

In general, our market is relatively insensitive to cyclical changes. It will continue to be driven by a number of megatrends, not least the phasing-out programme for environmentally hazardous HFC gases. The transition to greener alternatives is continuing, and we are working actively to provide the market with such offers. The digitalisation of our business is currently developing slightly faster than our previous estimates, partly due to the fact that we have launched e-commerce in new markets. The closures due to Covid-19 are also judged to have had an effect. During the quarter, our e-commerce has set new sales records.

Price levels for refrigerants have so far this year been under some pressure but have still been relatively stable. However, the level is significantly lower than the corresponding period last year. Next year, the permitted volume of CO2 equivalents in Europe will fall further, which may mean some stock build-up at our customers in the autumn.

Historically, business opportunities have arisen in times of crisis. In Beijer Ref's case, this may mean openings for new acquisitions in the coming quarters. We are following developments closely in order to be able to act quickly if opportunities arise.

Beijer Ref has previously become stronger in difficult times. Now too, I see opportunities for Beijer Ref to consolidate its position in the market as a leading global refrigeration wholesaler. We continue to work methodically according to our established strategy so to ensure positive long-term development for Beijer Ref.

Per Bertland, CEO

Second quarter of 2020


Beijer Ref’s net sales decreased by 16.5 per cent to SEK 3,338M (3,996) during the second quarter of 2020. Adjusted for exchange rate changes and acquisitions, organic growth in net sales was negative at -17.8 per cent (4.4).

The main reasons are the effects of Covid-19 and lower prices of refrigerants, since most of the largest markets, which together account for about 70 per cent of sales, were almost completely shut down from mid-March to early May. Beijer Ref estimates that sales have decreased by approximately SEK 700M mainly as a result of Covid-19. The decrease in sales has affected all geographical segments and had the greatest impact in southern Europe and Africa and the least impact in Asia Pacific. A stronger Swedish krona resulted in negative currency effects of SEK -63M (85), corresponding to -1.3 per cent (2.6), since most sales are in currencies other than Swedish kronor.


The group’s operating profit amounted to SEK 241M (373) during the second quarter, which is a decrease of 35 per cent. Negative exchange rate effects of SEK -2M (11) are included in the operating profit figures. The operating margin amounted to 7.2 per cent (9.3). The reduction in profit is due to the effects of Covid-19, lower prices of refrigerants and a shift in the mix to a higher proportion of air conditioning. Profit before tax was SEK 227M (359) and profit for the period was SEK 168M (265). Profit per share before dilution amounted to SEK 1.31 (2.08).


Cash flow from current operations for the first 6 months of the year before changes in working capital amounted to SEK 521M in 2020, compared with SEK 659M in 2019. The change is mainly due to lower earnings during the quarter.

Working capital increased by SEK 3M during the first half of the year compared with SEK -468M during the corresponding period of the previous year. Normally, the group binds capital in the second quarter and frees up capital in the second half of the year due to seasonal variations. The change in working capital between the years is due primarily to a smaller build-up of stocks and longer credit periods at suppliers.

Altogether, this gives cash flow from current operations of SEK 524M (-191).

At the end of the period, credit facilities amounted to SEK 3,925M (3,939), of which unutilised credits amounted to SEK 913M (1,427). The unutilised part has decreased due to borrowing in connection with the acquisition of ACD Trade and decided unpaid dividend. Net debt has increased from SEK 3,824M to SEK 3,087M.

Of the total credit facilities, 70% are due in November 2020 and the remainder in 2022 and 2023. Beijer Ref performed a procurement during the quarter and will extend outstanding credits after the end of the quarter with a differentiated maturity structure.


Cash flow from investment activities amounted to SEK -267M (-67), which relates primarily to business combinations and investments in fixed assets. During the first quarter, the company acquired ACD Trade.


During the second quarter of 2020 no acquisitions were made, but Beijer Ref continuously evaluates different acquisition candidates in order to increase its range and consolidate the market. Acquisition activity has naturally been hampered by the ongoing pandemic and travel restrictions, but the group plans to resume this as soon as possible.


The second quarter of the year has in many ways been marked by Covid-19 and its effects on society and the stock market. At the beginning of 2020, macroeconomic conditions were relatively good, although a slight slowdown could be observed. However, the spread of the Covid-19 virus changed the situation drastically and the market reacted with sharp stock market falls and lower interest rates. So far, the consequences have been significant and it is too early at present to assess the overall effects the outbreak will have on Beijer Ref. From the middle of March to the beginning of May, markets representing 70% of the group's operations have been closed. It is estimated that the group's net sales have decreased by approximately SEK 700 M as a result of Covid-19. Measures have been taken to address the effects, including in the following areas:

• Adjusted purchasing and inventory build-up, as well as extended credit periods

• Postponed investment plans at our central warehouse in Lyon, France

• Negotiations with landlords

• Temporarily reduced working hours for employees

• Redundancies and reductions in pay

The group estimates that savings amounting to approximately SEK 150M have taken effect during the period and the total net savings for 2020 are estimated to be approximately SEK 200M. Received subsidy amount to SEK 44.8M and received rental discounts amount to SEK 2.5M. These has been reported as reduction of cost. The group’s assessment is that Covid-19 will have a smaller effect on earnings for the remainder of 2020, but the situation is difficult to assess.


The Annual General Meeting was held in special circumstances in Malmö on 25 June 2020. In view of the present uncertainty caused by the Covid-19 pandemic, the board decided to halve the dividend proposed to the Annual General Meeting.

The dividend amounting to SEK 221M (190) was taken into account in figures as at 30 June 2020. The settlement date for the dividend was as previously announced 2 July 2020.


Since 2 January 2019, Beijer Ref’s B share has been listed on Nasdaq OMX Stockholm's Large Cap list. The share capital in Beijer Ref totals SEK 371,685,513, made up of 127,434,690 shares, each with a quota value of SEK 2.92. There are two types of share, A shares and B shares, which represent ten and one votes respectively. Beijer Ref had 10,246 shareholders on 30 June 2020 (7,893). The proportion of foreign shareholders amounts to 4.3% (4.5), with a capital shareholding of 59.5% (56.9). As of 30 June 2020, there were 9,918,720 class A shares and 117,515,970 class B shares. The company's ten largest shareholders hold 80% (79.1) of the votes and 66.9% (65.3) of the capital. Average sales of the Beijer share in the quarter amounted to 220,647 shares (208,173) per day at an average purchase price of SEK 234 (198). The closing price on 30 June 2020 was SEK 281 (229). As of 30 June 2020, the market value was SEK 35.6 billion (29.0).


Beijer Ref group's operations are affected by a number of external factors whose effects on the group's operating profit can be monitored to varying degrees. The group's operations depend on general economic developments in Europe in particular, which govern demand for Beijer Ref's products and services.

Like other global companies, Beijer Ref is affected by pandemics and in 2020 the Group will be affected by Covid-19. Most of the largest markets, which together make up about 70% of sales, has been almost completely shut down during part of March. The company is taking the necessary steps to reduce its impact and is following the WHO recommendations.

Acquisitions are normally associated with risks, such as loss of key personnel. Other operating risks, such as agency and supplier agreements, product liability and delivery commitments, technical development, guarantees, dependence on individuals etc., are continuously analysed. If necessary, measures are taken to reduce the group's risk exposure. In its operations, Beijer Ref is exposed to financial risks such as foreign exchange risk, interest rate risk and liquidity risk. The parent company's risk pattern is the same as that of the group. For further information, see the group's annual report.


This interim report was prepared in accordance with IAS 34, the Swedish Annual Accounts Act and RFR 2. Beijer Ref continues to apply the same accounting policies and valuation methods as described in the most recent annual report. Information pursuant to IAS 34.16A, in addition to disclosure in the financial reports and their associated notes, also appears in other parts of the interim report.

Financial assets and liabilities by category and level of valuation

The group's financial assets and liabilities consist of financial assets measured at fair value through other comprehensive income and financial assets and liabilities valued at accrued acquisition value.

Financial assets valued at fair value through other comprehensive income consist of two holdings, one of which (SEK 11M) refers to listed shares and is valued at market value on the balance sheet date (valuation level 1). The second holding (SEK 25M) is an unlisted holding and is valued at estimated fair value (valuation level 3). Financial assets valued at accrued acquisition value, such as trade receivables and other receivables, as well as cash and cash equivalents, amount to SEK 4,183M on the balance sheet date and financial liabilities valued at accrued acquisition value such as accounts payable, leasing liabilities and borrowings, as well as other long-term liabilities, amount to SEK 7,205M.

Financial interest-bearing liabilities such as loans linked to financing are entered at accrued acquisition value and are considered to constitute a good estimate of fair value taking into account the fixed terms and the setting of interest rates.


The company invites investors, analysts and the media to attend a telephone conference at which CEO Per Bertland and CFO
Maria Rydén will present the interim report for the second quarter of 2020. The presentation is held in English and lasts about 20 minutes. The meeting is on 15 July at 10.00 CET.

Follow the link:

Teleconference: Dial-in number
+46 8 50558355
UK: +44 33 330 090 32

US: +1 833 526 83 81

The presentation will also be available on the company's web­site from 08.40 on 15 July.

For more information on this report:

Per Bertland, CEO – switchboard, +46 (0)40-35 89 00

Maria Rydén, CFO – switchboard, +46 (0)40-35 89 00

This interim report has not been the subject of examination by the Company’s Auditors.

The Board of Directors and the President assure that the six-month report provides a fair overview of the operations, position and results of the Group and Parent Company, and describes material risks and uncertainties faced by the Parent Company and the companies that are included in the Group.

Malmö, Sweden, 15 July 2020

Bernt Ingman


Peter Jessen Jürgensen

Board Member               

Frida Norrbom Sams

Board Member               

William Striebe

Board Member

Greg Alcorn

Board Member               

Monica Gimre

Board Member

Joen Magnusson

Board Member

Per Bertland


This information is information that Beijer Ref AB is obliged to make public pursuant to the EU Market Abuse Regulation

and the Securities Markets Act. The information was submitted for publication, through the agency of the contact persons

set out above, at 08.30 CET on 15 July 2020.

This document is a translation of the Swedish language version.

In the event of any discrepancies between this translation and the original Swedish document, the latter shall be deemed correct.