AI interim report Q1 2020 1
INTERIM REPORT 2020 | I.A. HEDIN BIL AB | 1 JANUA
RY - 31 MARCH A word from the CEO During the first quarter, Hedin Bil benefited from higher profits than any other first quarter, due to efficiency programs and digitalization of customer offerings and internal processes. The new year came to a convincing start and the investments we have done in the past years in efficiency programs and digitalization continued to pay off. With the introduction of new emission regulations starting in 2020, it will be the year of a shift in focus to alternative drivetrains in the EU to avoid substantial penalties. This creates possibilities in the sales of both new and used vehicles. Margins improved both for car sales and the aftermarket, and in Sweden and Norway. The Belgian business was negatively impacted by a lock down of the economy starting March 18, due to the Belgian government’s response to Covid-19. In accordance with our philosophy to act quickly both on opportunities and risks, we launched extensive saving programs that will help us through the Covid-19 crisis. Since then, the development has differed between the markets. The Swedish market is the one of our home markets that has kept open to the largest extent, which we can also see in sales statistics. Norway closed parts of the society and at the other end of the spectrum Belgium has been under lock down for more than six weeks and are currently opening up slowly. New orders have decreased by 30 % - 40 % in the Swedish market since mid-March, while we have performed slightly better overall. In Norway, our deliveries decreased in line with the market, which has been affected slightly higher than Sweden. Our order book is however developing stronger than the market. The effect of this will be visible in the second quarter and is met by cost savings that come into full effect over the same period. At the same time, it is satisfying that our aftermarket services are running at full capacity in both Sweden and Norway. Belgium is slowly opening up and we estimate 50 % capacity in aftermarket services after the initial opening. Of course, we have also updated our guidelines in both showrooms and workshops to limit the risk of contracting virus for our customers and employees. We are continuously working to keep costs down and to have relevant inventories both when it comes to price and models. At the same time, the majority of the market is still intact, which means that we are even more focused on proactively contacting customers and making offers to limit the negative effects of the downturn. During our 35 year of business we have successfully managed both upturns and downturns in the market, and we act forcefully to stand stronger also when this crisis has passed. Anders Hedin 8