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Jetpak Top Holding AB (publ): Interim Report 1 January – 30 September 2020

Third Quarter: 1 July – 30 September 2020:

  • Total revenue increased by 1,4 % to TSEK 218,135 (215,092),
    with an underlying organic growth amounting to -8,4 %
  • Contribution margin amounted to 31,0 % (34,2 %)
  • Operating profit amounted to TSEK 22,905 (22,642)
  • Adjusted EBITA amounted to TSEK 23,613 (22,965)
  • Profit for the period amounted to TSEK 15,110 (16,332)
  • Earnings per share was SEK 1.26 (1.36), before and after dilution
  • Cash flow from operations amounted to TSEK 21,551 (26,072)
  • Cash and cash equivalents amounted to TSEK 54,257 (60,842)
  • Net debt in relation to adjusted EBITDA R12: 1.8 (1.4)

Interim Period: 1 January – 30 September 2020:

  • Total revenue increased by 2.3 % to TSEK 661,119 (646,375),
    with an underlying organic growth amounting to -10.3 %
  • Contribution margin amounted to 30,5 % (34,9 %)
  • Operating profit amounted to TSEK 46,022 (69,273)
  • Adjusted EBITA amounted to TSEK 48,146 (69,902)
  • Profit for the period amounted to TSEK 27,675 (48,570)
  • Earnings per share was SEK 2.31 (4.05), before and after dilution
  • Cash flow from operations amounted to TSEK 51,330 (23,514)

Comments from Kenneth Marx, CEO:
Q3 2020: Improvements during a challenging quarter

Following a very challenging second quarter, Jetpak had a satisfactory development during the third quarter. Despite a difficult business environment, we maintained a strong focus on cost control and commercial initiatives, which resulted in improved revenue and margins.

Jetpak’s revenue for the quarter increased by 1,4%, compared with previous year, equal to 218,1 MSEK. Operating profit for the quarter amounted to a satisfactory 22,9 MSEK, slightly higher than last year’s 22,6 MSEK.

Airfreight revenue and demand gradually increased during this quarter and especially larger accounts within airfreight products traded towards more normalized levels. Courier revenue and demand remained stable compared with last year and new contracts were added to our Express Systemized segment.

Jetpak’s market share remained stable within both the Express Systemized and Express Ad-hoc segments. Market share slightly increased on airfreight ad-hoc products, as we captured the benefits from more frequencies and demand for our flexible solutions.

Airline capacity gradually picked up during third quarter, but still accounted for less than 25% compared with last year. Especially our European and intra Scandinavian network remained highly challenged by continued travel restrictions and capacity shortage.

Due to some improvement of airline capacity and demand, we have seen a positive development on product mix in favor of higher margin airfreight products. Gradually improved network in our largest domestic markets (Sweden & Norway) had a significant impact on revenue growth and product margin improvement during this quarter.

A capacity surcharge was introduced in April, which has been maintained during the third quarter, as we experienced continued pressure on production costs due to alternative network solutions and general cost increases.

Cost control and variability has been a high priority during the quarter and overhead costs have continuously been monitored and adjusted to avoid unfavorable cost ratios.
Temporary staff reductions continued in Scandinavia, but a combination of continued European network reductions and cancellation of support programs led to permanent staff reductions in Finland and Benelux.

Work processes have temporarily been changed to minimize infection risk among employees and necessary precautions have also been taken to ensure social distancing and to avoid having to commuting during rush hours.

Our cash position remained solid during the quarter, as we captured the benefits of supplier renegotiations, combined with a firm cash collection process.

Integration of Jetpak Denmark (previously 3D Logistik) continued as planned, but with an expected delay of commercial and cost synergy, due to covid-19.

A strategic review was performed during the quarter and main priorities for the next 12 months were revisited and validated. European network expansion and specialized distribution services will be key areas as well as business partner programs and cost efficiency projects.

Continued work with Environment, Social & Governance (ESG) remains a priority. Jetpak will introduce a whistleblower program as well as emission reduction initiatives and sign on the participation in UN’s Global Compact and secure the implementation of the 10 principles within the company.

Airfreight capacity, and partly demand, is still exposed to new waves of covid-19, potentially leading to further temporary travel restrictions and lowering demand.
Jetpak has therefore established a contingency plan focusing on network substitution and cost control, in order to minimize any potential negative impact. New business opportunities are being explored, like the distribution of covid-19 test kits and future vaccines that require express- and specialized logistic solutions.

In view of our current performance and defined initiatives we maintain a certain optimism regarding the fourth quarter, even though the further covid-19 spread and the business impact from that remains highly unpredictable.

Based on our strategic review and our third quarter performance we maintain our long-term targets of 5% organic growth over a business cycle with 12% of adjusted EBITA.

 

The company’s certified advisor is FNCA Sweden AB, e-mail: info@fnca.se, telephone:+46 (0) 8 52 80 03 99
The information was submitted for publication, through the contact person mentioned below, on 26 November 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