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Interim report Q4 2020

Interim report Q4 2020

Growth continued in 2020

FINANCIAL RESULTS FOR THE PERIOD 
• Number of Hövding helmets sold during the fourth quarter increased to 33,853 (28,551) (+19%)
• Net sales of KSEK increased to 52,759 (46,467) (+14%)
• Gross margin of 24% (22%)
• EBITDA of KSEK –5,708 (-9,229)
• Profit after tax KSEK –7,387 (-10,137)
• Profit per share SEK -0,27 (-0,45)
• Cash flow from operating activities KSEK -8,364 (-2,016)

FINANCIAL RESULTS FULL YEAR
• Number of Hövding helmets sold full year 2020 increased to 96,560 (71,555) (+35%)
• Net sales of KSEK increased to 152,517 (112,919) (+35%)
• Gross margin of 23% (26%)
• EBITDA of KSEK -38,558 (-48,328)
• Result after tax KSEK -44,247 (-50,928)
• Result per share SEK -1,82 (-2,29)
• Cash flow from operating activities KSEK -43,160 (-32,805)

Operating profit includes an item relating to restructuring costs of 3,750 KSEK of a non-recurring nature.

SIGNIFICANT EVENTS AFTER THE PERIOD
Redemption of share warrants
During the period, redemption of a share warrant program for the employees took place. The warrants were subscribed for in the autumn of 2017. Holders of the warrants were offered to buy 1.48 shares per option for the price of SEK 21.55. The subscription was completed on October 31, 2020 and provided the company with KSEK 4.448 before issue costs.

GROWTH CONTINUED IN 2020
The number of Hövding helmets sold during 2020 increased by 35% compared to prior year. Net sales increased by 35%.

As second half of 2019 was influenced by the launch of Hövding 3 and unnatural movements between quarters the comparing quarter by quarter in this and last quarter is challenging. Hence, we operationally look at second half 2020 compared to prior year. We sum up a 51% net sales growth in the second half compared to modest 14% growth in first half.

This signals that we leave a very particular 2020 on a strong note. Demand is on good levels with sales in quarter four of 52,7mSEK. This is our biggest quarter to date and with the restructuring implemented during quarter three we are starting to tentatively see effect on our ebitda. Cleared of one-off restructuring cost ebitda is in quarter three and four at -6% and -11% respectively with a trend in the right direction. We still have work to be done and the area of gross margin is in particular focus. During spring we are implementing activities aimed at raising the average sales price, reducing cost of goods sold and lower the cost of warranties.

During the quarter we saw key international markets like Germany and Denmark returning to closer to expected levels with less direct negative effect of restrictions in consumer trading. Parallel to this Sweden continued to deliver well with known national partners such as Stadium, Outnorth, Designtorget etc. in the lead.

What unite all our key accounts, independent of country, is the possibility they see in making sales in an otherwise dormant period for cycling. It confirms Hövding’s ability to attract consumer demand all year round.

We have now entered 2021 and look forward to continuing the trend of improved results. It will remain a challenging year to plan given the pandemic and the operational restructuring implemented and lower fixed costs gives us better abilities to adapt our plans according to on one hand restrictions in the market and on the other hand a continued trend in increased urban cycling. The plan being implemented is; continued cost control, step by step improved gross margins coupled with growth in the three key markets. In addition, we will more actively pursue new geographical markets in Europe where we know smart solutions for urban cyclists is in high demand. In this work we consider the fact that up to half of all Hövding’s today are online purchases. Entering new markets will be a combination of both physical sales and online sales. Physical presence to complement a digital sales strategy rather than the other way around.

With 300 000 Hövding’s in the streets, in Sweden, Denmark and Germany alone, we have a real foothold. During quarter four a new Hövding user took to the street every 4th minute, 24/7. We see no trend of this slowing down. Instead we look forward to adding many saved lives to the thousands already protected by Hövding, eight times better than with traditional helmets.

Fredrik Carling
CEO
Hövding Sverige AB (publ)

Ph: +46 40 236868
fredrik.carling@hovding.com

Hövding Sverige AB (publ)
Bergsgatan 33
214 22 Malmö
+46 40 236868

Hövding Sverige AB (publ) is listed on the Nasdaq First North Growth Market since 2015. Västra Hamnen Corporate Finance AB is Hövding’s Certified Advisor.
E-mail: ca@vhcorp.se, tel: +46 40 200250

For further information, please contact Fredrik Carling on +46 40 23 68 68 High resolution images can be downloaded here:
www.mynewsdesk.com/se/hovding

The information herein is provided by Hövding Sverige AB (publ) in accordance with its duties of public disclosure as stipulated by the EU regulation on marketplace misuse, and the law on the securities marketplace. The information was made public by Fredrik Carling, CEO of Hövding Sverige AB (publ), on 22 February 2021 at 08.30am CET.

Attachments
Interim Report Q4 2020