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Interim Report Jetpak Top Holding AB (publ) 1 January – 31 mars 2020

Quarter 1: 1 January – 31 March 2020:

  • Total revenues increased by 13.1 % to TSEK 239,483 (211,681),
    with an underlying organic growth amounting to -2.7%
  • Net revenues increased by 12.3% to TSEK 232,355 (206,816)
  • Operating profit amounted to TSEK 14,822 (21,544)
  • Profit/loss for the period amounted to TSEK 8,452 (14,464)
  • Earnings per share was SEK 0.71 (1.21)
  • Cash flow from operations amounted to TSEK – 2,471 (-23,615)
  • Cash and cash equivalents amounted to TSEK 52,583 (35,880)
  • Net debt in relation to adjusted EBITDA R12: 1.8 (2.2)

Comments from Kenneth Marx, CEO:

”Resilient, but not immune”

During the first quarter Jetpak reported growth amounting to more than 13% and revenue of close to MSEK 240. Initially during the quarter focus was on the integration of the acquired Danish company 3D Logistik, including the implementation of commercial and operational improvement programs, which will form the basis for continued growth and margin improvements.

A relative stable market situation changed significantly during the latter half of the quarter, when the coronavirus pandemic (covid-19) hit the world with full force. Different countries’ lockdown activities resulted not only in slower infection rates, but also in an immediate negative impact on the countries’ economies, which in turn affected Jetpak with full effect from the month of March. The coronavirus pandemic had an impact on Jetpak’s first quarter results which amounted to MSEK 14.8, or MSEK 6.7 lower than the previous year.

The single most direct impact for Jetpak was that the major Nordic airlines during March, in various stages and at different speeds, reduced their daily flight capacity. This in particular affected our fastest air products in the Express Ad-Hoc and Express Systemized segment, where we almost from one day to the next no longer had access to the majority of the normally approx. 4,000 daily flights in our network. Despite this we have every day throughout this period had access to flight departures for our most important flight destinations, not least thanks to the fast government contracted flight routes within Norway and to destinations in the north of Sweden. In addition, Jetpak has a resilient business model which can be adapted to various types of rapid market changes:

  • Jetpak’s business model is ”asset light”, where approx. three-quarters of the cost base is variable. This includes that almost all of the now approx. 800 Jetpak-branded transport vehicles are owned by external franchisees and both air and ground transports are settled based on use. In the event of a drop in revenue as a result of reduced sales activities, Jetpak’s supplier costs will thus also be lower.
  • Jetpak is not dependent on a single mode of transport, such as a courier company or an air cargo company, but can seamlessly combine air and ground transports to solve the customer’s “door-to-door” transport needs. In those cases where we have not had access to air transport, we have on several occasions during this quarter been able to solve the customer need by quickly and temporarily replacing the air transport option with express land transport, for example between Stockholm and Sundsvall. Jetpak also has previous experience in solving transport challenges for its customers according to this flexible model, including during the spring of 2010, when the ash clouds from Eyjafjallajökull’s eruption disrupted all aircraft operations in many countries.
  • Jetpak also benefits from time-critical logistics solutions which nowadays is a must in a developed society as well as from the fact that our Nordic domestic market has not completely shut down its communities and therefore also not its entire economy, in the same total way as in many other countries. Despite Jetpak’s inherent resilience against this type of rapid and disruptive market changes, we are not fully immune, which is evident from the underlying organic growth of -2.7%.

During the end of the quarter, Jetpak therefore made a number of decisions that will have an impact on the second quarter:

  • At the end of March the Board of Directors decided to withdraw the proposed dividend to the Annual General Meeting of SEK 4 per share. This means that SEK 48 million will be withheld as an extra liquidity buffer for the company.
  • With effect from April, Jetpak introduced a capacity surcharge on air transports to compensate for increased transport and handling costs as a result of a reduced flight network.
  • Effective from the second quarter, Jetpak has been able to benefit from the support measures announced by the governments of the various countries during the end of the first quarter. Jetpak has therefore made use of temporary short-term lay-off solutions introduced in Norway, Sweden, Finland, Denmark as well as in Belgium. In addition to reduced payroll costs and social insurance contributions, we have also renegotiated supplier contracts – all in order to reduce costs and thereby minimise the risks and get through this period in the best way possible.
  • No employees have been given notice of termination as a result of this pandemic. Our assessment is that now when society seems to be starting to open up again, transport needs may quickly increase. It is therefore important that Jetpak’s current organisation and combined expertise are maintained in order to be able to respond quickly to an increase in demand. The current challenges can quickly be converted into new commercial opportunities.

Our estimate is that Jetpak will have the greatest impact from the corona pandemic during the period March – May and that we will then see a continuous recovery during the rest of the year. Growth in Jetpak’s air-based products will, however, depend on the rate at which the airlines increase the frequency to our most important network destinations. Although there is still considerable uncertainty concerning the expectations for the full year 2020, Jetpak is committed to our, previously announced, long-term target of achieving 5% organic growth and an operating margin of 12%.

The company’s certified advisor is FNCA Sweden AB, e-mail info@fnca.se, telephone +46 8 528 003 99.
The information was submitted for publication, through the contact person mentioned below, on 15 May 2020 at 06:30 CET. This constitutes information that Jetpak Top Holding AB (publ) is required to publish under the EU Market Abuse Regulation.


Kenneth Marx, CEO,
Phone: +46 (0) 73 368 54 00
e-mail: ir@jetpak.com

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