New Wave Group Annual Report 2021 - EN | Page 64

NWG // FINANCIAL INFORMATION

margin improved and costs increased slightly as the Group had a higher sales volume and more marketing activities than in previous quarters .

The fourth quarter yielded records in both earnings and net sales . The pandemic is still not over and several countries were given new restrictions . However , the Group had a continued positive development of both net sales and earnings during the last quarter of the year . Net sales improved by 23 % to 2,306.7 million , which also means the highest net sales we had in a single quarter . Operating result increased by 42 % compared to 2020 and the operating margin improved from 15.1 % to 17.5 %. The recovery is taking place in all regions and segments as well as in both sales channels . The gross profit margin improved compared with the previous year and costs increased as the Group had a higher level of activity than in previous quarters . Given both the negative effects of the pandemic and a certain shortage of goods , this is a very strong development .

Net sales for the year amounted to SEK 6,718.6 million , which was an increase of 10 % ( 13 % excluding currency change ) compared with the previous year . Both sales channels increased compared to last year . Corporate decreased their net sales by 4 %. The segment was mainly affected at the beginning of the year by canceled events , conferences and other corporate activities , which reduced the demand for promo products . The segment also had a lower share of trading orders compared with last year , which reduced this year ' s net sales . Savings and efficiency measures have been implemented . Sports & Leisure has also been negatively affected by COVID-19 as it has led to canceled sports events with reduced sales as a result . However , investments in the Craft brand continued during the year . The USA market was hit hard by the pandemic last year . The companies made large cost savings and adapted their operations to current volumes . When net sales increased , the segment had a smaller cost base , which resulted in a good earnings trend during the year . The segment as a whole increased its net sales by 29 % and operating result to SEK 466.0 ( 170.5 ) million . The Gifts & Home

Furnishings segment had a growth of 16 % despite the fact that several businesses such as retail , hotels , restaurants , etc . in Kosta were hit hard by the pandemic . Other operations in the segment such as Kosta Boda , Orrefors , Sagaform and others had a very good increase in net sales . This , together with an improved gross profit margin , has resulted in operating result amounting to SEK 99.3 ( 26.5 ) million . The Group ' s gross profit margin increased compared with the previous year and amounted to 48.1 ( 43.2 )%. Last year , the Group was quick to take measures and implement cost savings , as well as to adjust its operations to a lower volume . This has also yielded results in 2021 , and although external costs and personnel costs have increased during the second half of the year , costs are under good control . Some of the Group ' s companies received government grants at the beginning of the year . These are reported as other income and are reported in Note 26 . The higher net sales , improved gross profit margin and good cost control resulted in an operating result of SEK 1,005.9 million and an operating margin of 15.0 %. The improved operating result gave us the opportunity to repay debts also improving net financial items . Result for the year amounted to SEK 760.0 ( 363.0 ) million . Cash flow from operating activities was on a par with the previous year and amounted to SEK 1,207.4 ( 1,206.6 ) million . Capital assigned to inventories has not increased as much as was planned , which has been difficult due to disruptions in the production and logistics chains . However , the supply of goods has functioned relatively well , even though a slightly larger inventory at the end of the year would have been desirable in order to be able to meet the demand we see ahead with full service to our customers . Investment operations increased and amounted to SEK 114.2 ( 57.5 ) million . The equity ratio improved and amounted to 59.6 ( 53.4 )% and the Group ' s net debt decreased by SEK 748.8 million and as of December 31 amounted to SEK 1,068.8 ( 1,817.6 ) million .

064 // ANNUAL REPORT