The Managing Director’s comments

Stable Service Business and improved cash flow

Operational earnings for the fourth quarter amounted to SEK 414 M, a stable result given that the previous year was positively impacted by high deliveries of new cars due to new tax regulations introduced in Norway and Sweden. The result for the Service Business during the quarter amounted to SEK 320 M. Sweden and Western Europe reported stable results compared to the previous year, while Norway reported a result of SEK 38 M, compared to SEK 180 M the previous year. The lower result for Norway was primarily attributable to less delivered new cars compared to the previous year, but also to a challenging market situation in Norway, not only for us but for many others too. Operating cash flow improved on the previous year and amounted to SEK 147 M.

The customer’s needs have always been in focus at Bilia. By developing total solutions for car users, we can offer our customers a complete suite of services. We are receptive to what our customers are looking for, and we develop services for all car brands, including wheels, dismantling and reuse of used spare parts, car glass, used cars and repair workshops. We can see that the market’s future needs in these areas are growing as demand for sustainable solutions increases. Customer satisfaction is one of our sustainability targets, and in 2023 we once again reported an above-average level of customer satisfaction for our car brands. Satisfied customers are a key component in our strategy to be a successful organisation.

During the quarter, we have expanded the Bilia family through acquisitions, new operations, and a new business area. We have taken over operations in Bilcentergruppen Sörmland AB, where we offer sales and servicing of Mercedes-Benz cars and transport vehicles at an ultramodern facility. We have continued to establish the car brand XPENG and have extended our partnership with Nissan in Sweden. During the quarter, we signed an agreement to become the official importer of the Jaguar and Land Rover brands in Sweden and Norway, from 1 April 2024. We are delighted to have this opportunity to establish ourselves as an importer/general agent. Also during the quarter, we signed an agreement to acquire B MotorGroup Stockholm AB, and thereby add the Jaguar and Land Rover brands to our Swedish retail operation. As of January 2024, we conduct operations at two facilities in Stockholm, where we will offer customers high-quality servicing and sales of new and used cars.

Potential economic upturn in 2024?

The fourth quarter was another quarter characterised by high inflation and high interest rates. What we are seeing now are indications of lower inflation and interest rates during 2024. Bilia’s new car orders have historically been impacted negatively early on in times of recession, but have also been quick to improve once the economy recovers. We therefore have high hopes for an improved order situation for new cars in the second half of the year. In addition, we have a stable and profitable Service Business that makes up the majority of our operational earnings and which is significantly less sensitive to economic changes. Despite the challenging times we continue working together to take Bilia successfully into the future. Our long-term strategy remains: we know what we have to do, and how to get results.

Per Avander, Managing Director and CEO