Annual Report

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THE BE-GE GROUP ANNUAL REPORT 2016-2017Be-Ge Fรถretagen ABThe Be-Ge Group´s aim is to have a transparent business accounting, but without exposing individual…
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THE BE-GE GROUP ANNUAL REPORT 2016-2017Be-Ge Fรถretagen ABThe Be-Ge Group´s aim is to have a transparent business accounting, but without exposing individual business relationships. Current information about significant events and news is available at www.be-ge.se.Further information can be obtained from the Be-Ge Group Headquarters, phone number +46 491 45 46 10, or the CEO Erland Persson.ANNUAL REPORT 2016-2017 - THE BE-GE GROUPThis is the Be-Ge Group 4 Development of the Be-Ge Group 6 Message from the Owners 9 The Chief Executive's Review 10 Managing Directors and Site Managers of the Be-Ge Group 12Be-Ge Industri AB 14 Be-Ge Seating UK Ltd 16 Be-Ge Jany A/S 18 Be-Ge Savas Seating B.V. 20Be-Ge Baltic UAB 22 Be-Ge Stece AB 24 Be-Ge PlÃ¥tindustri AB 26Be-Ge Personbilar AB 28 Be-Ge Lastbilar AB 30 Be-Ge Lackering AB 32The Board 34 Income Statement & Balance Sheet 36 Key Ratios 373ANNUAL REPORT 2016-2017 - THE BE-GE GROUPThe Be-Ge Group The Be-Ge Group is a family-owned group of companies with operations in Sweden, Denmark, Great Britain, Lithuania, the Netherlands, Germany and Belgium. The Group comprises the business areas Be-Ge Seating Division, Be-Ge Component Division and Be-Ge Vehicle Division.BE-GE INDUSTRI AB Turnover SEK 269 million Employees 102 BE-GE JANY A/S Turnover SEK 64 million Employees 35 BE-GE SEATING UK LTD Turnover SEK 20 million Employees 8BE-GE SAVAS SEATING B.V. Turnover SEK 71 million Employees 40 SAVAS QUALITÄTSSITZE GMBH Turnover SEK 6 million Employees 3 SAVAS N.V. Turnover SEK 14 milllion Employees 44ANNUAL REPORT 2016-2017 - THE BE-GE GROUPPARENT COMPANY BE-GE FÖRETAGEN AB Employees 11BE-GE SEATING DIVISIONBE-GE VEHICLE DIVISIONBE-GE COMPONENT DIVISIONREAL ESTATEBE-GE LASTBILAR AB Turnover SEK 195 million Employees 38 BE-GE PERSONBILAR AB Turnover SEK 200 million Employees 38 BE-GE LACKERING AB Turnover SEK 29 million Employees 34BE-GE FASTIGHETER AB Turnover SEK 4 million Employee 0BE-GE BALTIC UAB Turnover SEK 21 million Employees 86BE-GE PLÅTINDUSTRI AB Turnover SEK 63 million Employees 51BE-GE STECE AB Turnover SEK 82 million Employees 525ANNUAL REPORT 2016-2017 - THE BE-GE GROUPDevelopment of the Be-Ge Group 19341987Bror Göthe Persson took over the import and sales of Ford motorcars in Oskarshamn. He was somewhat of a visionary with an early insight of the importance of motorization.Be-Ge Förarmiljö AB was established in Kolsva, Sweden specializing in the sales of driver seats and equipment for forest machinery.1941 Be-Ge Bil became sales agent for Scania Vabis trucks and is today the world’s oldest private Scania agent.1946 AB Be-Ge Karosserifabrik was established.1949 The first modern suspended driver seats for trucks were developed.1951 Be-Ge Bil became sales agent for Volkswagen.1962 The expansion continued and a factory was built for the manufacture of truck cabs also in the Netherlands.1966 The coachwork factories were acquired by Scania Vabis of Södertälje. The manufacture of truck cabs is still in Oskarshamn and is one of Kalmar County’s largest employers. The manufacture of the driver seats, to be fitted in the truck cabs, remained a BeGe production that continued in the new company Be-Ge Stolindustri AB, today Be-Ge Industri AB. 61990 The seat manufacturer Nyström Nordpatent AB in Umeå was acquired giving Be-Ge Industri AB a wider product programme with bus and truck seats and also office chairs. Bil & Maskin AB in Vetlanda was acquired, which increased the region for the sales of cars and trucks.1993 Be-Ge Traktor & Maskin i Åstorp AB started and became the general agent for Zetor tractors and Agrostroj agricultural machines. In the same year Bilcenter i Oskarshamn AB was established for the sales of Seat, later on also Skoda private cars1996 Be-Ge Industri AB was certified according to ISO 9001.1999 The vehicle companies were certified according to ISO 9002.2000 The activities in Umeå, Sweden were moved to Oskarshamn and the industrial facilities in Umeå were sold.ANNUAL REPORT 2016-2017 - THE BE-GE GROUPBror Göthe Persson, Founder of the Be-Ge Group20012008Jany Scandinavia A/S and Vald. Nielsen & Son A/S in Denmark, also Oskarshamns Plåtindustri AB were acquired.Be-Ge Baltic UAB and Be-Ge Stece AB became wholly-owned subsidiaries of Be-Ge Företagen AB.2002 Billackeringen E. Johansson AB in Oskarshamn was acquired as a future development of vehicle and industrial paint work.2003 The two Danish companies Jany A/S and Vald. Nielsen A/S were merged and the Copenhagen office closed down. In the same year the rights were acquired to market the office chair called “Ullmanstolen”.2005 The vehicle plant in Oskarshamn was extensively enlarged. Be-Ge Traktor & Maskin i Åstorp AB was sold.2006 Be-Ge Företagen AB acquired 80 % of the Lithuanian company UAB Amersanas and 1/3 of the industrial company Stece AB in Mönsterås, Sweden. BeGe Seating UK Limited was established in Coventry, England.2009 Be-Ge Personbilar AB celebrates its 75th anniversary. Be-Ge Fastigheter AB is established.2010 The partly-owned Be-Ge Förarmiljö AB is sold and the name is changed to Förarmiljö i Sverige AB.2012 A new service center for Scania opens in Hultsfred, Sweden.2014 Be-Ge Industri AB acquires 80 % of Savas Seating B.V. in Zaltbommel, the Netherlands, including the subsidiaries Savas Qualitätsitze GmbH in Germany and Savas N.V. in Belgium.2015 Savas Seating B.V. with subsidiaries became wholly-owned subsidiaries of Be-Ge Industri AB and the name is changed to Be-Ge Savas Seating B.V.2007 Be-Ge Företagen AB increased its share holdings in Stece AB to 50 per cent.7ANNUAL REPORT 2016-2017 - THE BE-GE GROUP915MILLIONTHE GROUP'S TURNOVER AMOUNTED TO SEK 915 MILLION57MILLIONPROFIT AFTER FINANCIAL ITEMS AMOUNTED TO SEK 57 MILLION72PERCENTEQUITY RATIO FOR THE YEAR IS 72 %48MILLIONINVESTMENTS DURING THE YEAR AMOUNTED TO SEK 48 MILLION 8ANNUAL REPORT 2016-2017 - THE BE-GE GROUP25PERCENT OUTSIDE SWEDENSALES OUTSIDE SWEDEN AMOUNTS TO 25 %66COUNTRIESWE SELL TO AROUND 66 COUNTRIESMessage from the Owners The past financial year has once again been a good one for the Be-Ge Group. For the first time we have passed SEK 900 million in sales and look forward to a continued positive development. The newly built factory in Lithuania is in full operation. Other Investments have been made in upgrading and extensionof the car showroom for Be-Ge Personbilar AB in Oskarshamn and also remodelling of Be-Ge Lackering AB´s premises for industrial paintwork. Be-Ge Lastbilar AB has invested in a bus terminal in Oskarshamn and an agreement has been signed with the new bus operator for Kalmar County.Our strong economy and our talented employees will allow us to make further investments in the years to come. For the Owners of the Be-Ge Group Per-Erik Persson9ANNUAL REPORT 2016-2017 - THE BE-GE GROUPChief Executive's Review2016-2017 was another Successful Financial Year The Be-Ge Group can once again report a year of good growth and high profitability. The economic upturn is continuing and our brands have strengthened their market positions. The profitability development and the positive cash flows that the Be-Ge Group has shown over the past four years have created conditions for further growth and additional acquisitions in growth sectors. Invoiced sales reached SEK 914.8 million (838.9), an improvement of 9 %. The operating profit amounted to SEK 57.1 million (58.1) and the operating margin was 6.2 % (6.9).Business Review The global economy shows positive signals, and the global gross national product is calculated to be 3.7 % 2017. The level of oil prices is low enough to provide positive injections to net importers, while reducing pressure on producer countries. Also, the economic upturn will increase new investments when the utilization of resources reaches a certain level, while the emerging economies again will contribute to further global growth. For the Euro zone, which is our home market, the GNP growth is estimated to be 1.8 % for 2017. The economic prospects have improved and several factors indicate that the growth is improving and will reach its highest level since 2011. The main reasons are rising employment, low interest rates, improved world economy and increased exports. In the Euro zone, Spain shows the best growth by 2.8 %. Of the Nordic countries, Sweden is expected to have the highest growth by 3.1 %, meaning that resource utilization rises to the highest level since 1980, while Norway has the lowest with 1.1 %. Difficulties in finding manpower may slow down expansion in some of our industries .10Erland Persson CEOAlthough the economic situation seems positive, there is a risk on the political side, above all due to the Brexit process and President Trump's policy. The current recovery is in number of years the longest since the post-war period and the longer it lasts, the more the risk of its near end.Key Events During the Year • During October, Be-Ge Baltic UAB in Klaipeda, Lithuania moved into a new modern plant in Klaipeda's Free Economic Zone. This investment amounts to approximately SEK 30 million and the factory is equipped with the latest technology in sewing and assembly. • In order to clarify the Be-Ge Group affiliation, the Savas Group's parent company has been renamed Be-Ge Savas Seating B.V. • During the year, Be-Ge Lastbilar AB has acquired the transport company EB Logistik's workshop with four employees. • To further develop the bus sector within Be-Ge Lastbilar AB, a separate property has been acquired in the autumn as a future bus depot. This business is scheduled to start in August 2017 with initially three employees. • Be-Ge Personbilar AB has invested about SEK 10 million in expansion of the passenger car facilities. The new plant was opened in the beginning of 2017. • Be-Ge Lackering AB has invested about SEK 14 million in completely new industrial premises and machinery.ANNUAL REPORT 2016-2017 - THE BE-GE GROUPDivisions Development Be-Ge Vehicle Division The invoicing amounted to SEK 400.6 milion (333.8) and the operating profit to SEK 7.4 million (10.9). Rebuilding and investments combined with a model change at the largest customer has been costly, which meant that Be-Ge Lackering AB's profitability was drastically reduced. The largest car market ever, combined with previously launched improvements, resulted in one of the best years ever for Be-Ge Personbilar AB. Be-Ge Lastbilar AB's acquisitions have continued in order to expand and diversify the operations. Be-Ge Component Division The invoicing amounted to SEK 127.4 million (138.3) and the operating profit to SEK 10.9 million (17.1). A model change at one of Be-Ge Stece AB's major customers resulted in a temporary volume drop and thus reduced sales figure for the year. Previously initiated improvement actions for Be-Ge Plรฅtindustri AB have yielded results in the form of better profitability during the year. Be-Ge Baltic UAB continues its expansion with a growth for the year of 27%. The growth for the year to come is expected to be at least 15%. Be-Ge Seating Division The invoicing amounted to SEK 384.2 million (364.5) and the operating profit to SEK 43.1 million (35.0). Be-Ge Savas Seating B.V. with subsidiaries has turned loss-making business into profit during this financial year. The profit for the year has been charged with additional one-off costs of somewhat over SEK 2 million in connection with gradual transition to a partially new product range. Be-Ge Industri AB reports its largest sale and profit hitherto. The sales increase is partly due to the extended cooperation with the subsidiary Be-Ge Savas Seating B.V.The Parent Company Be-Ge Fรถretagen AB is the Group's parent company. The head office is located in Oskarshamn, Sweden. The Group's business concept is to establish and develop profitable operations within each division. Be-Ge Fรถretagen AB is an active owner with members in each board of the subsidiaries. This also means that the companies have their own responsibility for the operational management in accordance with the board's rules of procedure. Together with the management of each subsidiary Be-Ge Fรถretagen AB provides the conditions for increased growth and improved profitability and also deals with issues such as acquisitions and divestitures. The Group's organization is based on a decentralized method of working, where a large proportion of responsibilities and powers are delegated to the respective subsidiary. The operational management means that the subsidiaries are systematically monitored each month through established procedures.Additional Information Be-Ge Fastigheter AB administers a number of residential and commercial properties in Oskarshamn. All premises are let at market rents. No vacancies have occurred during the year, which means that the result is better then heretofore.Special Message We have a fantastic organization of employees whom I want to thank for a very well done work during the financial year 2016-2017. Lastly, everything has its time - 32 years is a long period and Be-Ge AB has been a major part of my professional life. I have learned that family business is something very special. Now when I leave the operational work, I will miss the unique "Be-Ge Spirit" and all the colleagues I have had the privilege of working with. Next year a new CEO will be presented to you here.Due to a smaller number of large project orders than budgeted, Be-Ge Jany A / S temporarily dropped slightly in turnover compared with the previous year. Erland Persson Managing Director CEO11ANNUAL REPORT 2016-2017 - THE BE-GE GROUPManaging Directors and Site Managers of the Be-Ge GroupBo WaldebjerGary ShawLene BechIvo HeuvelmansVaida VaičaitienėBorn 1962Born 1968Born 1976Born 1972Born 1974"Creative product development makes us unique""Moving forward together, creating success along the way""We build a strong organization for the benefit of our customers”"We do not only sell seats but complete Seating Solutions"" We continue to develop and to expand our business"Be-Ge Industri ABBe-Ge Seating UK LtdBe-Ge Jany A/SBe-Ge Savas Seating B.V.Be-Ge Baltic UABPosition Man Dir. Employed 2000Position Site Man. Employed 2006Position Site Man. Employed 2006Position Site Man. Employed 2013Position Man.Dir. Employed 2007Education Education EducationEducation Education Mechanical EngineeringIMD Business School The Lausanne Managerial DevelopmentCand. Merc, Organisation and StrategyUniversity Human ResourcesKlaipeda University Linguistic studies Lithuanian and SwedishUniversity Business ManagementMontford County High School Warrington Technical Collage Previous experience Previous experiencePrevious experience Previous experience Previous experience Dep. Man.Dir. Press & PlåtGruppen ABCommercial Advisor Trade Commission of DenmarkBusiness Controller BrandexManager Human Resources (Steel business)Insurance ConsultantFinancial Controller Kilroy Group TravelLocation Manger (Steel Business)Man.Dir. Press & Plat N.V. BelgienLPM Manager Lansing Linde SterlingPress och Plåtindustri AB Spare Parts Manager Valmet, Sisu OYMan.Dir. UAB Beja Project Coordinator UAB Baltic Business Center Site Man. Dep.Man. from 199912ANNUAL REPORT 2016-2017 - THE BE-GE GROUPRobert NyqvistBirger AnderssonTomas EngsundTomas JonssonBorn 1967Born 1966Born 1965Born 1963"Customer value created by innovative solutions, good service and accurate deliveries""Our hallmark is quality and reliable deliveries""Increased availability and reduced lead times give higher levels of utilization for our customers."We supply customer value based on knowledge, speed and flexibility”Be-Ge Stece ABBe-Ge Plåtindustri ABBe-Ge Personbilar AB Be-Ge Lastbilar ABBe-Ge Lackering ABPosition Man.Dir. Employed 2007Position Man.Dir. Employed 2004Position Man.Dir. Employed 2013Position Man.Dir. Employed 2005EducationEducation EducationEducation M.Sc. Mechanical Engineering, Linköping University IHM advanced certificate in Business Management, IHM Business SchoolTechnical High School, Mechanical EngineeringBusiness Economics, School of Economics, Gothenburg Construction EngineerTechnical Secondary School Vehicles, paintingPrevious experience Previous experiencePrevious experience Previous experience Man.Dir. Carrab IndustriStece ABMan.Dir. Atteviks LastvagnarIn painting industry since 1985Consultant TRR Trygghetsrådet Techn. Man. FCI KatrineholmPress och Plåtindustri AB Stece ABBe-Ge Lastbilar AB Man.Dir. Oskarshamns FraktProd. Eng. Man. De La Rue Cash SystemsProject Leader NCC FastigheterProject Leader De La Rue Cash SystemsProject Engineer Architectural office13ANNUAL REPORT 2016-2017 - THE BE-GE GROUPBe-GeFöretagen Industri AB Be-Ge AB Be-Ge Industri AB develops, manufactures and markets fixed and suspension driver seats, passenger seats, surveillance and office chairs and accessories for these products. Customer-unique products are being developed on commission for OEM-customers. Our reputed products are well known among the drivers of commercial vehicles, trucks and buses, forest and contract vehicles and industrial trucks as well as among all others who ”sit” at their place of work. Further examples of work groups using our seat products with the trademarks ”Be-Ge”, ”Sverigestolen” (the Sweden Chair) and ”Ullmanstolen” (the Ullman Chair) are process operators, personnel in surveillance centres and offices, train drivers and vessel operators.Summary of the Financial Year The financial year started as expected with stable demand at a high level. During the first six months of the financial year, sales increased by 10 % compared to the corresponding period the previous year. After a volume dip, the year ended with an improved turnover. During the year 2016-2017, Be-Ge Industri AB has, as sole shareholder of Be-Ge Savas Seating B.V and its subsidiaries in Belgium and Germany, turned a loss-14weighted business into positive operating profit. The sales trend for the Be-Ge Seating Division’s (BSD) products is clearly increasing. During the financial year, Be-Ge Industri AB's management has been renewed with two new employees and also added with one person. The management now includes a total of six persons. The new positions are Purchasing & Logistics Manager, Design & Development Manager and Sales Manager for vehicle seats. The newly developed seat "Heavy Duty" was first shown at the Conexpo trade fair in Las Vegas. Multi annual growth with good earnings is a result of the employee's collaboration and efficiency when it comes to delivering BE-GE products that meet customer expectations. The total invoicing amounts to SEK 268.7 million (244.7) with a profit after net financial items of SEK 33.3 million (26.4). The equity ratio at year-end is 79 % (77).Expected Development 2017-2018 The company's customers really understand the difference and value of the BE-GE product's unique features. The needs of theses customers are theADDRESS: Box 912, SE 572 29 Oskarshamn, Sweden VISITING ADDRESS: Gjutaregatan 4, Oskarshamn TEL: +46 491 76 18 00Sales by geographical market MSEKRest of the worldBalance sheet total, Equity and SolidityInvestments %2004%80717570 606150Sweden 65 %330502025102 113/14 14/15 15/16 16/17 Bal. sheet totTurnover and Number of employees NUMBER incl. inter-company sales MSEK 18027016024014021012018010015080120609040602030 13/14 14/15 15/16 16/17 = Women440100Inner circle = Last year= Men550125EU 31 %MSEK90Thereof adj. equity13/14 14/15 15/16 16/17– = SolidityResult after net financial items MSEK 35 30Research and Development Costs MSEK%8772566552044153310 5 13/14 14/15 15/16 16/172211 13/14 14/15 15/16 16/17 – = % of Turnover– = TurnoverProportion of the Group’s external invoicing: 25 %company's challenges. The BE-GE seats offer a significant function between the person/
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