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BE Group AB: BE Group Q2 2016 - improved earnings and continued strong cash flow

· Net sales decreased by 5 percent to SEK 1,047 M (1,104).
· The underlying operating result improved to SEK 21 M (12).
· The operating result improved to SEK 31 M (10).
· The result after tax was SEK 19 M (-13).
· Cash flow from operating activities was SEK 36 M (-28).
· The number of shares was reduced following a reverse share split
based on one new share for every 20 existing shares.

· Earnings per average number of shares amounted to SEK 1.47.
CEOs Message
Comments on the period
The effects of both rising prices and underlying margin improvements
were seen in the second quarter of 2016. The sharp decline in prices
that affected the market at the end of 2015 resulted in a lower
average price level compared with the same period last year. This had
a negative impact on sales, but a higher underlying gross margin
resulted in an improvement in the underlying operating result to SEK
21 M (12). In addition to the improvements in margins, the Group's
results also increased as a result of the recovery in prices during
the year. The gradual rise in prices had positive inventory effects
in the form of inventory gains of SEK 10 M (-2) in the quarter,
leading to the operating result improving to SEK 31 M (10).

Market demand is assessed to have been stable or slightly up. Business
area Sweden & Poland's shipped tonnage was in level with the same
period last year, while business area Finland & Baltics showed volume
growth of a significant 11 percent. Growth in volumes in business
area Finland & Baltics was so strong that, despite lower average
prices, net sales for the business area grew by 4 percent. However,
the Group's total tonnage was negatively affected by developments in
the Czech Republic and Slovakia, where the ongoing restructuring
process led to a halving of shipped tonnage. Overall, consolidated
net sales decreased by 5 percent to SEK 1,047 M (1,104).

The positive result and good control of working capital has led to
continued positive cash flow. Cash flow from operating activities
improved in the quarter to SEK 36 M (-28), which means the
corresponding figure for the last 12 months is SEK 76 M.

Structural and organizational changes
The previously announced structural process to close unprofitable
units in the Czech Republic and Slovakia is continuing according to
plan. The operations in Slovakia are being closed, along with sales
of flat carbon steel and aluminium on the Czech market. The
inventories concerned sold out in the quarter, and the number of
employees was reduced. The employees affected have in an exemplary
way, contributed to a successful process. The restructuring, for
which costs of SEK -45 M impacted the first quarter, will be
completed in the second half of 2016.

During the second quarter a new Group structure- and organization
based on the Group's business models was launched. As a result of
this and the ongoing restructuring of the Group's operations in the
Czech Republic and Slovakia, the Group is now operating according to
the structure set out below:

· Business area Sweden & Poland comprises the Group's operations in
Sweden and Poland and is operated in two business units focused on
distribution and production, respectively.

· Business area Finland & Baltics comprises the Group's operations in
Finland and the Baltic States and is operated across three business
units; distribution Finland, distribution Baltics and production

· While the Group's operations in the Czech Republic and Slovakia are
undergoing restructuring, these operations are reported under the
Parent Company and Consolidated Items segment.

In the second quarter, BE Group recruited a new Sourcing director who
will be part of Group Management and responsible for the
implementation of the Group's purchasing strategy.

Steel prices are expected to continue to increase slightly in the
third quarter, while demand is expected to remain at the current
level, accounting for vacation effects in July and August. The
restructuring and improvement measures relating to the new
organizational structure are expected to proceed according to plan
and gradually improve consolidated earnings.

Anders Martinsson, President and CEO

For further information, please contact:
Anders Martinsson, President and CEO tel.: +46 (0)706-21 02 22 e-mail:

Andreas Karlsson, CFO tel.: +46 (0)709-48 22 33 e-mail:

This information is information that BE Group AB (publ) is obliged to
make public pursuant to the EU Market Abuse Regulation and the
Securities Markets Act. The information was submitted for
publication, through the agency of the contact persons set out above,
at 7.45 am CET on July 20, 2016.

BE Group, listed on Nasdaq Stockholm, is a trading and service company
in steel, stainless steel and aluminium. BE Group offers efficient
distribution and value-adding production services to customers
primarily in the construction and engineering sectors. In 2015, the
Group reported sales of SEK 4.2 billion. BE Group has about 750
employees, with Sweden and Finland as its largest markets. The head
office is located in Malmö, Sweden. Read more about BE Group at


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