A word from the CEO – from 29 April 2020

A WORD FROM THE CEO

A positive start to the year was followed by utterly different future prospects as a result of the corona pandemic. COVID-19 affects everyone at both the personal and professional levels, and our Group is active in an industry that has been hit very hard by market conditions that have changed totally.

After the fourth quarter and this year’s first two months showed that the activities pursued with a focus on restoring profitability in our businesses had begun to yield results, it became apparent in early March that the impact of the corona virus on all parts of the Group would be extensive. We then shifted our focus and initiatives from measures to enhance profitability toward proactive efforts and risk mitigation with the aim of combating and limiting the financial impact and damage to our companies arising as a result of COVID-19. Intensive work is under way both to bring the company through the present crisis and to create a platform for subsequently reopening and continuing to develop the essentially strong business operations that make up the Group.

What began as a strong year with an operating profit after February that was SEK 12 million better than the previous year’s, was suddenly replaced in March with an accumulated loss of SEK -44 million, a deterioration of SEK 27 million compared to the previous year. One major explanatory factor was the complete closure of the German market throughout the month, which led to our seeking bankruptcy for the German operation. This had a negative impact on earnings in the amount of SEK 18 million, but which does not affect the liquidity in the Group. The pandemic situation also triggered extraordinary expenses in the Group in general of approximately SEK 3 million, and thus other units were SEK 3 million the worse in the quarter than last year. However, the internal target for the quarter was far higher and more in line with actual financial performance immediately after February.

In order to secure the short-term liquidity of the company, an underwriting commitment for a new share issue and loan facility was signed in April, for adoption by the AGM in May. We have also received bondholder approval for the capitalization of interest payments for three quarters; furthermore, applications for both the recovery and suspension of employer contributions, tax and VAT have been granted.

The liquidity-boosting measures together with the cost-saving activities implemented will allow us to extricate ourselves from the situation in a structured manner, but we still have much to do to get through the crisis the entire experience industry is undergoing. Sustained intensive efforts to reduce our cost base will continue, while analyses and discussions with operators linked to the company’s long-term financing will go on.

Following the most critical phase in the management of the challenges arising from the pandemic, the activities and measures taken during the second half of 2019 and which continued into 2020, will remain in focus. Creating more dynamic cost bases, flexible and relevant business models and understanding and responding to the demand arising from the changes in volume we believe will take place in the market in terms of both financial and behavioural patterns, will be of the utmost importance for our continued presence as a significant operator in the segments where we do business.

Gothenburg, 29 April 2020


Josefin Dalum
pro tem CEO/Group CEO