The quarter in summary
- Doro’s net sales amounted to SEK 336.7 million (424.2), a decrease of 20.6 percent.
- Net sales for business area Doro Care were SEK 138.0 million (130.3), an increase of 5.9 percent and for business area Doro Phones were SEK 198.7 million (293.9), a decrease of 32.4 percent.
- Gross margin increased to 37.7 percent (33.7). For Doro Care, the gross margin increased to 41.5 percent (40.8) and for Doro Phones the gross margin increased to 35.1 percent (30.6).
- Operating profit (EBIT) amounted to SEK 18.4 million (15.2), excluding project costs for the separation and listing of business area Doro Care of SEK 1.0 million, corresponding to an operating margin of 5.5 percent (3.6). Including project costs, EBIT amounted to SEK 17.4 million (15.2) with an operating margin of 5.2 percent (3.6).
- Profit after tax for the period was SEK 18.8 million (14.5) and profit per share was SEK 0.78 (0.61).
- Free cash flow before acquisitions was SEK -47.6 million (-22.0).
Message from the CEO
During the quarter we have seen a positive development and increased activity in some of our main markets, although the situation is still uncertain. For business area Doro Phones, France delivered a strong quarter and for business area Doro Care we see an increased tender activity in the Swedish market.
Sales during the first quarter amounted to SEK 336.7 million (424.2), a decrease of 20.6 percent compared to the first quarter of 2020. During the quarter we have experienced increased problems in the supply chain with constraints in components, increased lead times and continued high freight costs. So far, we have succeeded in meeting the demand from our customers, but with increased problems, there is a risk that this will have a negative effect in the coming quarters. Despite all challenges, we have delivered an improved gross margin of 37.7 percent (33.7) and a strong operating profit of SEK 17.4 million (15.2). The positive development is proof that we effectively managed to adapt the business to the current situation, while at the same time focusing on the future.
We have during the first quarter seen a positive development within business area Doro Care, despite the continued impact of the pandemic, mainly on the Swedish market where procurements once again gained momentum. The increased tender activity is mainly an effect of Addas (former SKL Kommentus) temporary framework agreement. We are experiencing an increased confidence in us as a supplier as we won several new agreements in Sweden and the UK during the quarter. We expect to see a positive impact on sales from the new contracts in the coming quarters. Gross margin amounted 41.5 percent (40.8), an improvement compared to the first quarter of 2020. During the quarter we carried out a number of activities, mainly in the UK, where we reduced the number of platforms in our alarm receiving centres in order to streamline our service delivery. To achieve the margins we aim for, we need to continue the efficiency work in the future as well.
During the quarter, as part of our growth strategy, we carried out one acquisition and a product launch within business area Doro Care. At the beginning of February, we acquired FirstCall 24/7, which together with our other operations in the UK creates a strong position in the market. At the end of the quarter, we launched the Doro 450, our new mobile social alarm, which increases safety in the home and on the go. The launch is a step forward in our ambition to create a safer and more independent life for the senior.
Business area Doro Phones has continued to suffer from lockdowns, restrictions and decrease in sales as a result of the pandemic. Although the business area as a whole has been negatively affected by the pandemic, France has shown a positive development and delivered a strong quarter. On the other hand, we see a continued negative trend in Germany where we performed below our target. As a result of this and as a final part of the restructuring program, we have initiated a restructuring of the region. With continued strong cost control, we have been able to balance the effects of weaker sales, delivering an improved gross margin of 35.1 percent (30.6) and a strong operating profit.
At the beginning of the quarter, we communicated that the board intends to separately list business area Doro Care and the preparations are in full swing. The purpose of the separate listing is to create the best conditions for both businesses to develop more favorably. We are convinced that a separation creates better opportunities for the business areas to fulfill their strategies. The work of separating the business areas is proceeding according to plan with the aim of listing Doro Care on the stock exchange during the fourth quarter of 2021. We have an incredibly exciting and intense journey ahead of us and I look forward to working with the organisation to create a better foundation for the business areas to reach their full potential.
WEBCAST
A webcast conference call will be held on Thursday 29 April at 9.00 am (CET) when President and CEO Carl-Johan Zetterberg Boudrie will present the report. The webcast is accessed at https://tv.streamfabriken.com/doro-q1-2021. The presentation material is available on Doro’s financial website http://www.doro.com/corporate.
Telephone numbers:
Sweden: +46 8 50 55 83 52
United Kingdom: +44 33 33 00 92 63
USA: +1 83 35 26 83 47
France: +33 170 75 07 18
DORO AB 
