LEAX Interim Financial Report Q4 2023
The fourth quarter in summary
• Net Sales increased to SEK 577.3 million (501.0)
• Operating profit increased to SEK 3.8 million (-10.9)
• Earnings before tax (EBT) increased to SEK -13.8 million (-17.9)
• Net income for the period increased to SEK -16.9 million (-67.2)
• Cash flow from operating activities amounted to SEK 60.1 million (30.5)
The full year in summary
• Net Sales increased to SEK 2,182.5 million (1,923.5)
• Operating profit increased to SEK 43.5 million (2.3)
• Earnings before tax (EBT) increased to SEK -0.7 million (-17.1)
• Net income for the period increased to SEK -12.9 million (-72.3)
• Cash flow from operating activities amounted to SEK 183.1 million (116.8)
Comments from the Group President and CEO, Roger Berggren;
In Q4 2023, LEAX continues to execute on its strategic plans to develop products with higher engineering content and diversify our markets. Net sales for the fourth quarter were SEK 577.3 million (501.0) which is an increase of 15.2% compared to the same period last year. The increase is derived from higher sales in Heavy Commercial Vehicles and inflation recovery but offset by weaker sales in our largest Battery Electric Vehicle (BEV) passenger car program.
In the fourth quarter Operating profit increased to SEK 3.8 million (-10.9) a solid improvement compared to same period last year. The increase was driven by higher volume in Heavy Commercial Vehicle markets, weaker inflation, and cost recovery. Our results were negatively impacted by lower sales in our BEV passenger car program and higher costs related to new product introductions.
For the full year of 2023, Net sales increased to SEK 2,182.5 million (1,923.5) an increase of 13.5% year over year. The increase was driven mainly by strong demand for Heavy Commercial Vehicles, greater supply chain stability within this market and by pricing to recover inflationary costs. Sales were down with our Passenger car and Mining & Construction customers compared to 2022.
Operating profit for the full year increased to SEK 43.5 million (2.3). The significant improvement in our result can be attributed to more stable volumes and lower volatility within the Heavy Commercial Vehicle supply chain. Inflationary cost recovery was positive as implementation of pricing was lagging the impact of inflation that affected us in 2022. Lower volumes of passenger car components and higher project costs were negatives to our operating profit versus 2022.
The fourth quarter of 2023 is reflective of the past several years starting with the pandemic years of 2020 and 2021. Cyclicality and seasonality have been replaced by uncertainty and volatility. The world is seemingly jumping from crisis to crisis which impacts performance in unpredictable ways. Our entire organisation has performed admirably and, in many cases, outstandingly during this period. We have become more agile, flexible, and faster to respond to changes in order patterns and deal with cost pressures.
LEAX continues to operate with excellence as recognized by many of our customers during the quarter and year. Through hard work and commitment to our core values we have been acknowledged through supplier of the year awards and with significant new business wins.
As of February 2, I have taken on the role of CEO following Tony Nicol's resignation. Tony's expertise has played a significant role in the company's growth, particularly in expanding our end markets and strengthening our product portfolio. As Tony moves on from LEAX, our strategic plan remains our top priority. We have strengthened our management team, and we are excited to meet the challenges that lie ahead.
About LEAX
LEAX Group AB (publ) is the parent company of a group (“LEAX Group”) with about 1,100 employees. LEAX has operations in Köping, Falun and Falköping in Sweden, Riga and Rezekne in Latvia, Curitiba in Brazil, Detmold in Germany, Mezökövesd in Hungary and Wuxi in China. The Group designs, develops and industrializes advanced manufacturing solutions and superior products for global mobility and industrial markets. The Group had sales of SEK 2.2 billion in 2023.