Half-year report - RIAS A/S

NASDAQ OMX Copenhagen A/S
PO Box 1040
DK-1007 Copenhagen K

Roskilde, May 2024

RIAS A/S

HALF-YEAR REPORT FOR THE PERIOD

1 October 2023 – 31 March 2024

CVR 44 06 51 18

Company Announcement No 8 of 14. May 2024

Management’s Review

Company Announcement No 8 of 14 May 2023

The Board of Directors has today adopted the half-year report for the period 1 October 2023 to 31 March 2024.

Highlights of H1:

Operating results:

Revenue amounted to TDKK 136,5, which is a 4.2% decrease compared to the first half of the financial year 2022/23. The decrease is partly due to the long winter and challenging markets with high interest rates and low activity level.
The development in the Industry Division reflects that the demand has been declining in both the domestic market and the export sector for semi-finished products. The development covers great variations within the demand from different industries where i.a. product areas in the Viscom sector have been declining. The processing area is developing as planned.
The revenue of the Building & Construction Division is in line with the budget and above the same period in 2022/23.
Capacity costs have increased compared to the most recent financial year. This is due to reorganizations and investments in more IT security. Salaries have been under pressure due to a combination of less people available in the market and expectations to have the inflation covered. Investments have continued in strategic development areas such as the processing area and the export. This is to strengthen the development going forward. Investments in the Green transition has also been carried out and in Q2 the solar panels contribute to the reduction of Co2 emission. Replacement of diesel driven cars to electric cars are still in focus and proceeding as planned with additional charging stations installed as well.
Sales and financial performance for the first half of the financial year 2023/24 are below expectations but the beginning of second half of 2023/24 has shown higher sales and better financial performance,

Karsten Due, CEO, comments as follows on the half-year financial Statements 2023/24:

Reflecting on a challenging first half-year: The first half-year has been marked by challenges, where we met our budget targets in Q1 but faced challenges in Q2. The long winter period and the early occurrence of Easter in 2024 have posed challenges to our revenue and earnings in Q2, contributing to our inability to meet our budget for the first half of 2024.
Positive signs in April: Despite the challenges in the second quarter, we are pleased to report that we have observed very positive signs in the month of April. We note with satisfaction that we already see a significant recovery of the losses from the second quarter, especially in terms of revenue.
Delivery challenges due to lack of raw materials and geopolitical uncertainty: Additionally, we have observed a trend of insufficient raw materials, leading to delivery challenges in semifinished materials. This development has added complexity to our business, but we remain vigilant in addressing these issues to ensure minimal disruption to our delivery performance. It's also important to note the geopolitical uncertainty prevailing in the global landscape, particularly concerning the ongoing conflicts in Ukraine and Gaza. These conflicts pose potential risks to our supply chains and market stability, and we are closely monitoring the situation to mitigate any adverse effects on our operations.

Outlook for H2 2023/24:

Based on the development in H1 and taking the development mentioned above into consideration for H2, the board of directors keep the expectations of an adjusted EBIT result for the financial year 2023/24 in the range of DKK 16-18 million as announced in the annual report 2022/23.

Roskilde, 14 May 2024

Karsten Due
CEO

Financial Highlights
1/10-2023- 1/10-2022- 1/10-2022-
Income statement (DKK million) 31/3-2024 31/3-2023 30/9-2023

Revenue        136.5        142.5        313.1
Cost of sales        92.3        95.5        209.6
Gross profit        44.2        47.0        103.5
Capacity costs        43.2        42.1        86.6
Profit/loss before special items        1.0        4.9        16.9
Special items        0        0        0
Profit/loss before financial income         1.0        4.9        16.9
Financial items net        0        0.5        -0.9
Profit/loss before tax        1.0        4.4        16.0
Tax on profit/loss for the period        0.2          0.9        3,5
Net profit/loss for the period        0.8         3.5        12.5

Balance sheet, end of period (DKK million)
Non-current assets        117.3        121.7        122.5
Current assets        115.6        114.8        131.9
Assets        232.9        236.5        252.4
Equity        179.5        178.2        187.2
Deferred tax        9.8        9.5        9.8
Non-current liabilities        3.2        6.1        4.2
Current liabilities        40.4        42.7        51.2
Liabilities and equity        232.9        236.5        252.4

Cash flows (DKK million)
Cash flows from operating activities        -5.6        10.3        26.9
Cash flows from investing activities        -0.9        -2.6        -4.9
Cash flows from financing activities        -11.4        -14.3        -16.1
Total cash flows        -17.9        -6.6        5.9
Average number of full-time employees        105        105        104

Financial ratios:
Accounting ratios:
Gross margin        32%         33%        33%
Profit margin before special items        1%        3%        5%
Profit margin        1%        3%        5%
Solvency ratio, end of period         77%        76%        74%
Share ratios:
Profit per DKK 100 share        3,33        14.93        37
Equity value per DKK 100 share, end of period        778        772        812
Market price per DKK 100 share, end of period         660        635        670

The rations have been calculated in accordance with the definitions below. Profit per share which have been calculated in accordance with IAS 33.

Definitions of financial ratios:
----------------------------------------------------------------------------------------------------------------------------------------------------------------
Gross margin is calculated as gross profit in % of revenue.
Profit margin before special items is calculated as profit/loss before special items in % of revenue.
Profit margin is calculated as profit/loss before financials and tax in % of revenue.
Book value per DKK 100 share is calculated as equity end of period divided by 1/100 of the share capital.
Profit per DKK 100 share are calculated as profit/loss for the period divided by 1/100 of the share capital after deduction of the Company’s holding of own shares end of period.
Solvency ratio is calculated as equity end of period in % of balance sheet total end of period.

Shareholder information
Share capital:
The Company’s share capital, DKK 23,063k, is distributed on DKK 3,125k A shares and DKK 19,938k B shares.

A shares, which are non-negotiable instruments, carry 10 votes per DKK 100 share, see article 11 of the Articles of Association. B shares, which are negotiable instruments, carry 1 vote per DKK 100 share, see article 11 of the Articles of Association.

The B-shares are listed on NASDAQ OMX Copenhagen A/S.

The Board of Directors and the Executive Board do not hold any shares in RIAS A/S.

Contact, Investor Relations:
For more information concerning investor relations and the share market, please contact:

Karsten Due, CEO
Tel: +45 46 77 00 00
E-mail: KAD@rias.dk

Management’s Statement

The Board of Directors and the Executive Board have today considered and adopted the Half-year Report of RIAS A/S for the period 1 October 2023 – 31 March 2024.

The Half-year Report, which has not been audited or reviewed by the Company’s auditor, is prepared in accordance with IAS 34 ”Interim Financial Reporting” as adopted by the EU as well as Danish disclosure requirements for listed companies.

In our opinion, the Half-year Report gives a true and fair view of the financial position at 31 March 2024 of the Company and of the results of the Company’s operations and cash flows for the period 1 October 2023 – 31 March 2024.

Moreover, in our opinion, Management’s Review gives a true and fair view of the development in the Company’s activities and finances, the results for the period and the Company’s financial position as a whole as well as a description of the most significant risks and elements of uncertainty to which the Company is exposed.

Roskilde, 14 May 2024
Executive Board:

Karsten Due Dannie Michaelsen
CEO CFO

Board of Directors:

Astrid Meicherczyk Peter Sørensen
Chairman Vice-chairman

Nicolas Neuwirth Dieter Wetzel

June Svendsen Jette Duus

Statement of Comprehensive Income

		1/10 2023-	1/10 2022-	1/10 2022-
Amounts in DKK ’000	Note	31/3 2024	31/3 2023	30/9 2023
Revenue	3	136.517	142.550	313.114
Cost of sales		-92.347	-95.472	-209.621

Gross profit		44.170	47.078	103.523
Distribution expenses		-38.403	-36.108	-73.644
Administrative expenses		-4.798	-5.964	-12.946
Profit/loss before financial income and expenses		969	4.934	16.933
Financial income		692	113	313
Financial expenses		-675	-632	-1.252


Profit/loss before tax		986	4.415	15.994
Tax on profit/loss for the period		-217	-971	-3.487
Net profit/loss for the period		769	3.444	12.507

Other comprehensive income		0	0	0

Comprehensive income for the period		769	3.444	12.507

Earnings per share: Earnings per share		3,33	14.93	54.20
Earnings per share, diluted		3,33	14.93	54.20

Balance Sheet

Amounts in DKK ’000	Note	31/3 2024	31/3 2023	30/9 2023
Assets

Non-current assets
Intangible assets	4	53.124	53.274	53.197
Property, plant and equipment	5	56.793	58.281	58.693
Right on use assets	6	7.417	10.114	8.570
Total non-current assets		117.334	121.669	120.460

Current assets
Inventories	7	33.023	33.429	28.388
Receivables	8	54.431	49.423	58.130
Prepayments		5.195	4.241	4.720
Cash at bank and in hand		22.387	27.751	40.714
Corporation tax		572	0	0
Total current assets		115.608	114.884	131.952

Total assets		232.942	236.513	252.412

Liabilities and equity

Equity		179.452	178.153	187.216

Liabilities

Non-current liabilities
Deferred tax		9.789	9.464	9.789
Lease liabilities		3.227	6.143	4.238
Total non-current liabilities		13.016	15.607	14.027

Current liabilities
Lease liabilities		5.077	4.317	4.658
Trade payables and other 9 Payables		35.397	37.817	43.733
Corporation tax		0	619	2.778
Total current liabilities		40.474	42.753	51.169

Total liabilities		53.490	58.360	65.196

Total liabilities and equity		232.942	236.513	252.412

Other notes, see pages 13 - 16

Statement of Changes in Equity


1 October 2023 – 31 March 2024
	Share capital	Revaluation reserve	Retained earnings	Proposed dividend	Total
Equity at 1 October 2023	23.063	1.898	153.722	8.533	187.216
Comprehensive income for the Period	0	0	769	0	769
Dividend paid	0	0	0	-8.533	-8.533
Equity at 31 March 2024	23.063	1.898	154.492	0	179.452


1 October 2022 – 31 March 2023
	Share capital	Revaluation reserve	Retained earnings	Proposed dividend	Total
Equity at 1 October 2022	23.063	1.898	149.748	11.532	186.241
Comprehensive income for the Period	0	0	3.444	0	3.444
Dividend paid	0	0	0	-11.532	-11.532
Equity at 31 March 2023	23.063	1.898	153.192	0	178.153

Cash Flow Statement

	1/10 2023 -	1/10 2022 -
Amounts in DKK ’000	31/3 2024	31/3 2023
Net profit/loss for the period	987	4.417

Adjustment for non-cash operating items etc:
Tax on profit/loss for the period	217	917
Depreciation and amortisation	4.411	4.440
Profit or loss on sale of property, plant and equipment and financial assets	0	-40
Financial income	-692	-104
Financial expenses	675	622

Cash flows from operating activities before changes in working capital	5.598	10.306

Adjustment for changes in working capital:
Changes in inventories	-4.634	-9.224
Changes in receivables (and prepayments)	3.224	18.784
Changes in trade payables and other payables	-6.874	-5.571

Cash flows before financial income and expenses and tax	-2.686	14.295

Financial income, paid	563	113
Financial expenses, paid	-153	-279
Corporation tax paid	-3.350	-3.863
Cash flows from operating activities	-5.626	10.266

Purchase of intangible assets	0	0
Purchase of property, plant and equipment	-876	-2.561
Sale of property, plant and equipment	0	0
Cash flows from investing activities	-876	-2.561

Payments on lease liability	-2.899	-2.849
Dividend paid	-8.533	-11.532
Cash flows from financing activities	-11.432	-14.381

Cash flows for the period	-17.934	-6.676

Currency regulation cash	-393	-352

Cash and cash equivalents at 1 October	40.714	34.779

Cash and cash equivalents at 31 March	22.387	27.751

Notes

Note 1. Accounting policies

The Interim Report is presented in accordance with IAS 34, Presentation of Interim Reports, as adopted by the EU and Danish disclosure requirements relating to listed companies.

The accounting policies remain unchanged from those applied in the Annual Report for 2022/23. The Annual Report for 2022/23 contains the full description and can therefore be found there.

Note 2. Accounting estimates and judgements

The preparation of the half-year Report requires Management to make accounting estimates that affect the application of the accounting policies as well as the recognition of assets, liabilities, income and expenses. Actual results may differ from such estimates.

When preparing the half-year Report, the most material estimates made by Management in connection with the application of the accounting policies and the most material uncertainty in this respect are the same as in connection with the preparation of the Financial Statements for 2022/23, to which reference is made.

Note 3. Revenue

Note 5. – Property, plant and equipment

	Land and buildings	Plant and machinery	Fixtures and fittings, tools and equipment	Total
Cost at 1 October 2023	66.382	37.953	22.158	126.493
Additions for the period	0	876	0	876
Disposals for the period	0	0	0	0
Cost at 31 March 2024	66.382	38.829	22.158	127.369
Depreciation at 1 October 2023	-27.453	-21.935	-19.283	-68.671
Depreciation for the period	-193	-1.366	-346	-1.905
Reversed depreciation on disposals for the period	0	0	0	0
Depreciation at 31 March 2024	-27.646	-23.301	-19.629	-70.576
Carrying amount at 31 March 2024	38.736	15.528	2.529	56.793



Cost at 1 October 2022	66.382	34.034	22.033	122.449
Additions for the period	0	2.476	85	2.561
Disposals for the period	0	0	0	0
Cost at 31 March 2023	66.382	36.510	22.118	125.010
Depreciation at 1 October 2022	-27.069	-19.235	-18.478	-64.874
Depreciation for the period	-193	-1.261	-403	-1.857
Reversed depreciation on disposals for the period	0	0	0	0
Depreciation at 31 March 2023	-27.262	-20.586	-18.881	-66.729
Carrying amount at 31 March 2023	39.120	15.924	3.237	58.281

Note 6. Right on use assets

	Land & buildings	Other fixtures and fittings tools and equipment	Total
Cost at 1 October 2023	18.789	5.422	24.211
Additions for the period	0	1.281	1.281
Disposals for the period	0	0	0
Cost at 31 March 2024	18.789	6.703	25.492
Depreciation at 1 October 2023	-12.336	-3.305	-15.641
Depreciation for the period	-1.629	-805	-2.434
Disposals of depreciations	0	0	0
Depreciations at 31 March 2024	-13.965	-4.110	-18.075
Cost at 31 March 2024	4.824	2.593	7.417

Note 6. Right on use assets continued

	Land & buildings	Other fixtures and fittings tools and equipment	Total
Cost at 1 October 2022	18.283	5.763	24.046
Additions for the period	0	1.044	1.044
Disposals for the period	0	0	0
Cost at 31 March 2023	18.283	6.807	25.090
Depreciation at 1 October 2022	-9.334	-2.903	-12.237
Depreciation for the period	-1.624	-1.115	-2.739
Disposals of depreciations	0	0	0
Depreciations at 31 March 2023	-109.58	-4.018	-14.976
Cost at 31 March 2023	7.325	2.789	10.114

Note 7. Inventories	31/3 2024	31/3 2023
Inventories are specified as follows:
Goods for resale	35.588	36.408
Write-down at 1 October	-2.565	-2.979
Write-downs for the period	0	0
Write-down at 31 March	-2.565	-2.979
	33.023	33.429

Note 8. Receivables	31/3 2024	31/3 2023

Trade receivables	53.101	47.650
Receivables from group enterprises	88	193
Other receivables	1.242 0	1.580 0
	54.431	49.423

Write-down for bad debts is specified as follows:
Write-down at 1 October	-1.523	-1.447
Write-downs for the period	784	80
Write-down at 31 March	-739	-1.367

Note 9. Trade payables and other payables	31/3 2024	31/3 2023

Trade payables	19.122	18.332
Payables to group enterprises	237	362
Accrued VAT	4.956	5.251
Holiday pay accrual	1.777	1.416
Other payables	9.305	12.456
	35.397	37.817

Note 10. Contingencies and other financial commitments

Since the issue of the Financial Statements 2023/24, there have been no significant changes that have not been disclosed in this Half-year Report.

Note 11. Subsequent events

After the Half-year Report balance sheet date, no significant events have occurred that have not been incorporated and sufficiently disclosed in this Half-year Report.

Attachment