New Wave Group AB Q2_2018_EN | Page 7

Kosta Boda Art hotel has excellent conference opportunities. Pictured below are a few examples. JANUARY - JUNE NET SALES COSTS AND DEPRECIATION External costs increased by SEK 63.6 million and amounted to SEK -622.3 (-558.7) million and the increase is attributable to higher sales and marketing activities. Personnel costs amounted to SEK -507.3 million which is SEK 46.2 million higher than last year (SEK -461.1 million). The increase is related to more employees, primarily in sales, warehouses and customer service. Net sales amounted to SEK 2,796.0 million, which was 6 % higher than last year (SEK 2,635.9 million). Exchange rates have not affected the turnover during the first half of the year. Of the Group's sales channels, promo increased by 11 % while retail decreased by 1 %. Net sales in Sweden increased by 4 % and both sales channels showed growth. USA decreased by 2 %, which is related to the change in the exchange rate when converting into SEK. Turnover in local currency increased by 4 %. Other Nordic countries increased by 10 % which occurred in the promo sales channel while retail was in line with last year. Sales in Central and Southern Europe have increased by 7 % and 12 % respectively, which is related to the promo sales channel. Other countries increased by 23 %, which is related to the promo sales channel and the Asian market. Depreciation and write-downs were higher compared to last year and amounted to SEK -36.1 (-30.7) million. The increase is primarily related to investments in new and existing buildings as well as IT investments. Exchange rate fluctuations have increased costs by SEK 3.1 million. OPERATING RESULT GROSS PROFIT The operating result increased somewhat and amounted to SEK 155.9 (153.7) million. The operating margin amounted to 5.5 (5.8) %, where the slightly lower margin is attributable to the cost increases associated with increased sales and marketing activities. The gross profit margin improved compared with last year and amounted to 47.0 (45.4) %. It is mainly the segment Sport & Leisure that increased its margin but also Corporate Promo increased. Gifts & Home Furnishings has a slightly lower margin. The Group has a well-balanced stock and a good level of service. NET FINANCIAL ITEMS AND TAXES Net financial items improved by SEK 9.0 million compared to last year and amounted to SEK -16.6 (-25.6) million. The improvement is related to lower interest costs. OTHER OPERATING INCOME AND OTHER OPERATING EXPENSES Other operating income increased by SEK 9.3 million to SEK 27.2 (17.9) million. Other operating income is mainly attributable to operating currency gains but also other remunerations and should be compared to the result row "Other operating expenses" where mainly operating losses are reported. Other operating expenses increased by SEK 8.4 million and amounted to SEK -20.1 (-11.7) million. The net total of above items amounted to SEK 7.1 (6.2) million. Tax on result for the period amounted to SEK -26.6 (-26.1) million. RESULT FOR THE PERIOD Result for the period amounted to SEK 112.7 (101.9) million and earnings per share amounted to SEK 1.70 (1.55). 7