Press release 2/24/2021

Year-end report 2020

In year-end report for 2020 VBG Group delivers a strong fourth quarter, despite the continued pandemic.

Fourth quarter 2020

  • Consolidated sales decreased 10.3% to SEK 759.9 M (847.3).
  • Adjusted for exchange rate changes, actual organic growth was negative 2.5%.
  • Operating profit increased to SEK 86.2 M (66.8) and the operating margin was 11.3% (7.9).
  • Profit after financial items amounted to SEK 80.4 M (61.8).
  • The Group’s profit after tax amounted to SEK 50.9 M (53.6). 
  • Earnings per share amounted to SEK 2.04 (2.15).

Full-year 2020

  • Consolidated sales decreased 15.5% to SEK 3,147.2 M (3,725.4).
  • Adjusted for exchange rate changes between years, actual organic volume growth was negative 12.7%.
  • Operating profit increased to SEK 353.4 M (435.0) and the operating margin was 11.2% (11.7).
  • Profit after financial items amounted to SEK 326.5 M (397.0).
  • The Group’s profit after tax totaled SEK 226.7 M (299.5).
  • Earnings per share amounted to SEK 9.07 (11.98).
  • The Board of Directors proposes an ordinary dividend of SEK 4.50 per share (0.00). This means the proposed total dividend corresponds to 49.6% (0.0) of profit after tax.
  • Consolidated sales decreased 16.4% to SEK 759.6 M (909.1).

Comment from VBG Group´s President & CEO, Anders Birgersson

Strong fourth quarter – despite the continued pandemic

Despite the world being affected by a hard second wave of the virus during the fourth quarter, VBG Group managed to achieve very strong results for the quarter. As regards earnings, the Group delivered SEK 86.2 M (66.8) in EBIT, with a margin of 11.3% for the quarter.

Truck & Trailer Equipment had one of its best fourth quarters ever with regard to its EBITA margin. Demand for products remained healthy, despite the pandemic. The division has shown signs of robustness, delivering with a high degree of customer satisfaction while successfully keeping overheads down.

Ringfeder Power Transmission also delivered excellent results, with EBITA of SEK 21.1 M (12.0) in the fourth quarter. This means that profitability rose 75.8%, to a great extent owing to a favorable product mix and strong cost controls.

Mobile Climate Control was the division most severely impacted by the pandemic. Public transportation in North America decreased drastically during the year, which meant reduced use of the aggregate bus fleet. For Mobile Climate Control’s part, this resulted in both fewer deliveries to new production and reduced aftermarket business. The division generated an EBITA of SEK 19.2 M (23.2). Moreover, the decision was taken to charge the fourth quarter with a number of non-recurring overheads in order to be better positioned for the future. The work on restructuring Mobile Climate Control for increased profitability continues.

Financially strong

I am extremely satisfied with VBG Group’s results for the fourth quarter. The benefit of a diversified business portfolio is clear, and we have a healthy balance as regards both resources and structure. At present, we are in a position of financial strength with a good cash flow, and we are ready for forward-looking investments and acquisitions.

I am humbly full of expectations around being able to expand the Group. After the acquisition of Mobile Climate Control, we have grown into our new clothes and the time is now ripe to grow again, primarily within the Truck & Trailer Equipment and Ringfeder Power Transmission business areas.

A year like no other

If I were to sum up 2020, I would say that it has been an unusual roller coaster of a ride. The pandemic resulted in a combined shock to supply and demand, which meant that sales fell sharply during the second quarter of 2020. In the third quarter, demand subsequently rose and the supply chains began working again. There was a clear recovery during this period. In the fourth quarter, we saw the second wave of the spread of infection, but fortunately this time without the same impact on VBG Group’s products and services.

I am extraordinarily pleased with and proud of the way in which the organization successfully handled the unusual conditions in 2020. I would like to praise all our employees, who showed great flexibility and a forward-looking spirit.

The Group has had a number of outbreaks of the disease, but relatively speaking we have been spared from the pandemic. All of the personnel who fell ill have come back. We went into 2020 with the excellent results from 2019 in tow. That, and the government support programs we were able to take part in, provided us with the resources to manage 2020 without forgoing forward-looking initiatives. We continued to work on product development during the year, making investments in the future.

The future

I look forward to 2021 with confidence. I hope that the new vaccines now being rolled out around the world will lead to the infection slowing down, and that the world will recover. For VBG Group, the focus will continue to be on delivering sustainable products and solutions to our customers, in combination with initiatives in growth and expansion.