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2021-10-07

Synsam Group: Synsam intends to list its shares on Nasdaq Stockholm

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO, THE UNITED STATES OF AMERICA, AUSTRALIA, HONG KONG, CANADA, NEW ZEALAND, JAPAN, SWITZERLAND OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL OR WHERE OTHER RESTRICTIONS WOULD APPLY. PLEASE SEE "IMPORTANT INFORMATION" AT THE END OF THE PRESS RELEASE.

Synsam AB (publ) ("Synsam", the "Company" or the "Group"), the leading optical retailer in the Nordic Region[1], today announces its intention to list its shares on Nasdaq Stockholm (the "Listing"). In connection with the Listing, a diversification of ownership will be made through an offering of existing shares to be sold by the Company's principal shareholder (the "IPO" or the "Offering").

Synsam is a leading optician group in the Nordic region[2], with a differentiated and sustainable Lifestyle offering. The Group operates through directly-owned and franchise stores as well as through e-commerce channels. Founded in 1968, Synsam has evolved from being a group of individually run optical retail stores to a leading customer-focused omni-channel operator with a network of 490[3] well-invested stores in Sweden, Denmark, Norway, and Finland, and around 908 opticians performing approximately 673,000 eye examinations per annum. Synsam considers itself to have consistently been at the forefront of innovation in the Nordic optical retail market across multiple dimensions including customer journey and digitalisation, product offering and ESG. This has translated into an attractive financial profile characterized by strong organic growth, significantly higher growth than the broader market[4], combined with a scalable cost base and strong cash generation.

The Group is led by a highly experienced management team supported by both corporate and country management teams with in-depth understanding of, and longstanding retail experience in, each of its local markets.

Synsam's principal shareholder, Theia Holdings S.à r.l. (the "Principal Shareholder"), a company indirectly majority owned by CVC European Equity Fund V ("CVC Fund V"), have together with the Company's board of directors and management made the assessment that the Listing and diversification of ownership are expected to positively contribute to the further development and expansion of Synsam's operations and commercial opportunities. Synsam's board of directors and management believe that the Listing will benefit the Company by providing enhanced access to capital markets in Sweden and internationally for any potential capital needs to support its growth. Furthermore, the Company believes that the listing of the shares on Nasdaq Stockholm will strengthen the Group's public profile through increased attention and brand awareness among current and prospective customers, commercial partners and other stakeholders.

Nasdaq Stockholm's listing committee have made the assessment that Synsam fulfils the relevant listing requirements. Nasdaq Stockholm will approve an application for admission to trading of the Company's shares on Nasdaq Stockholm, provided that certain customary conditions are fulfilled, including that the Company submits such application and that the distribution requirement for the Company's shares is fulfilled. Depending on market conditions, the Offering and listing on Nasdaq Stockholm is expected to be completed during the fourth quarter of 2021.

Håkan Lundstedt, CEO Synsam, comments:

"A listing is a natural next step for a growth company like Synsam. Our focus on innovation, sustainability and customer experience has contributed to transforming our entire industry. Demand for products for our eyes is growing rapidly, as we get older and spend more time in front of screens. As the leading Nordic lifestyle company in optical retail and eye health, we are positioned to meet that demand and continue to drive innovation in our markets, but recognise that we still have a lot to do. We see many great opportunities to accelerate our expansion, and a listing will enable us further to go after those opportunities."

Peter Törnquist, Chairman of the Board of Synsam, comments:

"I am both proud and impressed by Synsam's development in the past years. The organisation's agile and progressive culture and leadership has contributed to change across the whole industry with new and innovative services, new store concepts and novel product offerings. Through the dedicated work by the management team and the employees throughout the group, Synsam has grown rapidly and established a strong position in the Nordics. I am looking forward to continuing Synsam's growth journey as a listed company."

Gustaf Martin-Löf, Senior Managing Director at CVC Capital Partners and a board member of Synsam, comments:

"Since CVC Fund V acquired Synsam in 2014, the company has completed a successful transformation to become a leading and fast-growing Nordic lifestyle company in optical retail and eye health. Synsam's clear focus on innovation and sustainability has been driving the success of the business. Synsam is expanding, attracting new customer segments and aiming to continue to change the buying behaviour in the industry to promote sustainability and subscription solutions to simplify and improve the customer journey. We welcome new shareholders joining CVC on this exciting journey and we are looking forward to continuing to support the Company with CVC Fund V remaining a material owner after the IPO."

The Offering in brief

The Offering is expected to consist entirely of existing shares offered by the Principal Shareholder. The shares that are offered by the Principal Shareholder are expected to also include a minor sale of existing shares from other shareholders in the Company, including board members and members of the executive management team, which are expected to sell shares to the Principal Shareholder, who in turn will sell the shares in the IPO.

The shares in the Offering are expected to be offered to the general public in Sweden, Norway, Denmark and Finland and to institutional investors in Sweden and abroad.

The offer to institutional investors will only be made (i) to certain institutional investors outside the United States, pursuant to Regulation S under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"); and (ii) in the United States, only to those reasonably believed to be Qualified Institutional Buyers in reliance on Rule 144A under the U.S. Securities Act.

Full terms, conditions and instructions for the Offering will be included in the prospectus to be published by the Company in connection with the Listing and the Offering. The prospectus will be published on Synsam's website www.synsamgroup.com. Further information about the process will be continuously published.

Selected financial information

The following table shows selected performance measures1) of Synsam for the period 1 January to 30 June 2021 and 2020, as well as for the financial years 2020, 2019 and 2018.

Twelve Six
months -month
ended 31 period
December ended
30 June
SEK million if 2020 20192) 2018 2021 2020
nothing else is
specified
Total revenue 3,860.3 3,781.2 3,410.4 2,276.8 1,762.8
Organic growth in 3.2% 9.0% 10.5% 30.4% -7.2%
directly owned
stores3)
Adjusted EBITDA4) 947.9 983.6 643.2 603.7 383.6
Adjusted EBITDA 24.6% 26.0% 18.9% 26.5% 21.8%
margin5), %
Adjusted EBITA6) 557.0 593.3 485.1 405.7 180.9
Adjusted EBITA 14.4% 15.7% 14.2% 17.8% 10.3%
margin7), %
Synsam Lifestyle 1,555.1 1,329.5 825.3 1,016.4 686.6
sales8)

1)        IFRS performance metric: Total revenue derived from the Company's consolidated financial statements audited by KPMG. Remaining metrics are alternative performance measures, which are not defined according to IFRS and extracted from the Company's internal accounts and has neither been audited nor reviewed by the Company's auditor.

2)        As an effect of the introduction of IFRS 16 Leases as of 1 January 2019, Synsam's financials were impacted as of 2019.

3)        Growth in net sales adjusted for the net effect of acquisitions, currency and franchise stores.

4)        Operating profit before depreciation and amortisation of tangible non-current assets, including right-of-use assets and intangible non-current assets adjusted for items affecting comparability.

5)        Adjusted EBITDA as a percentage of total revenue.

6)        Operating profit after depreciation of tangible non-current assets, including right-of use assets, but before amortisation of intangible non-current assets adjusted for items affecting comparability.

7)        Adjusted EBITA as a percentage of total revenue.

8)        Sales related to spectacle subscription and related services, including Synsam Lifestyle as well as Profil Optik Lifestyle.

Financial targets[5]

Growth rate: Synsam Group targets annual organic growth of 8-12%, in the medium term, depending on pace of greenfield expansion.

Profitability: Synsam Group targets an annual adjusted EBITDA margin of 25% or more in the medium term, depending on pace of greenfield expansion.

Capital Structure: Synsam Group targets a net debt / adjusted EBITDA ratio of 2.5x, excluding temporary deviations.

Dividend policy: Synsam Group aims to pay dividends of 40-60% of the net profit for the year.

Synsam's strengths

Synsam is confident that its success to date is the result of the strengths described below, and Synsam believes that it will continue to benefit from these factors going forward:

  • Synsam is the largest Nordic optical retail specialist[6]
  • Operates in a structurally growing and resilient market
  • Culture of innovation is part of Synsam's DNA with pioneering eyewear subscription in the Nordics
  • Well-invested store network and industry leading digital proposition
  • Attractive financial profile
  • Multiple, tangible, sources of sustained growth
  • Committed management team with strong track record

The largest Nordic optical retail specialist

Synsam is a market-leading optical retail company in the Nordic region.[7] According to the Market Study, the Company holds the number one position in Sweden with a market share of 33 per cent, the number two position in Denmark with a 23 per cent market share, the number two position in Norway with a 21 per cent market share, and the number five position in Finland with a 6 per cent market share (in terms of market share in 2020). Synsam outgrew the market across all geographies significantly between 2015 and 2019 and is in a strong position to take further market share going forward according to the Market Study.

Structurally growing and resilient market

According to the Company management, optical retail is one of the most attractive sub-segments of the broader retail sector. The optical retail market is characterised for stable and resilient growth throughout economic cycles compared to overall retail, which tends to be more cyclical in nature. This resilience is mainly driven by the medical nature of spectacles and shorter replacement cycles seen in recent years. The optical retail market is also known for strong and sustainable margins, scale advan...

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