Proffice Interim report January-March 2014

PRESS
RELEASE
                 Stockholm 2014-05-22

Interim report January-March 2014

PROFFICE DOUBLES OPERATING PROFIT

Q1 2014 year-on-year comparison

•                            Revenue decreased 6 per cent to SEK 996 million
(1,062)

•                            EBITA and operating profit increased 100 per cent
to SEK 20 million (10)

•                            EBITA and operating margin stood at 2.0 per cent
(0.9)

•                            Basic earnings per share totalled SEK 0.19 (0.19)

•                            Cash flow from operating activities totalled SEK -1
million (44)

Financial overview

                           First quarter  Change   Full year
Group                      2014   2013    quarter  2013
Revenue, SEK million       996    1,062   -6%      4,318
EBITA and operating        20     10      100%     125
profit, SEK million
EBITA and operating        2.0    0.9     -        2.9
margin, %
Profit after tax, SEK      13     13      0%       104
million
Basic earnings per share,  0.19   0.19    0%       1.52
SEK
Diluted earnings per       0.19   0.19    0%       1.52
share, SEK
Cash flow from operating   -1     44      -        207
activities, SEK million
Cash flow from operating   -0.01  0.64    -        3.03
activities per share, SEK
Basic equity per share,    8.63   7.40    17%      8.37
SEK
Return on equity, %        19.0   12.6    -        19.2

CEO comments

Proffice doubles operating profit
After just over a quarter as CEO and president, I can state that Proffice is a
profitable company with great potential. Compared to last year’s first quarter,
operating profit doubled to SEK 20 million (10).

Happier customers
We think we discern a certain optimism in the market, which is demonstrated
especially by the fact that a number of customers in both Sweden and Norway
chose to employ many of the temporary consultants who were contracted from
Proffice. This will have a negative effect on our earnings in the short term,
but it is also proof that customers are satisfied with our matching of
consultants, which hopefully will build trust and increase volume in the long
term.

When I visit my new colleagues across the Nordic region, I see great commitment
to our customers. Proof of our customer’s appreciation is that the customer
satisfaction index survey (CSI) conducted during the first quarter broke the
record once again.

Simpler, clearer structure
Revenue is not growing, however, partly due to the fact that some major
customers are placing fewer orders. In order to strengthen and energize the
sales process and raise internal efficiency, I have initiated an organizational
change that will take effect 1 June. The organizational structure will be
simpler and clearer, and Group management will be reinforced with the heads of
the four major business units and the head of Group Sales.

In line with Proffice’s main strategy – product leadership through
specialization – we are establishing a company called Dfind Science &
Engineering. This entails combining the existing operations of Proffice Life
Science and Dfind Engineering and further developing them to add new services
and new markets.

A non-recurring cost for this organizational change will be in the range of SEK
10-15 million and will affect earnings in the second and third quarters. Annual
savings from 2015 are expected to be SEK 5-10 million.

Strengthening for the future
The new organizational structure will enhance the Group’s focus on sales. In the
first and second quarters we will develop our future sales strategy and will
implement it in the fourth quarter. Weak sales to new customers have affected
consolidated revenue for some time, but our ambition to grow faster than the
market stands firm.

The organizational changes coupled with additional investments in Group
infrastructure and IT systems of SEK 20-25 million per year in 2014 and 2015
convince me that we can improve our ability to respond more quickly to the
market. Consequently, Proffice will further strengthen its position in order to
become the most successful staffing company in the Nordics.

Henrik Höjsgaard
President and CEO

If you have questions about this interim report, please contact:

Henrik Höjsgaard, President and CEO, telephone +46 8 787 17 00,
henrik.hojsgaard@proffice.com

Benno Eliasson, CFO, telephone +46 8 787 17 00, benno.eliasson@proffice.com

This is a translation from Swedish. In the event of any discrepancies between
the Swedish and the translation, the former shall have precedence.

Proffice is the specialised flexible staffing company with more than 10,000
employees in the Nordic region. We provide temporary staffing, recruitment
services, and outplacement. Proffice is listed on the NASDAQ OMX Stockholm, Mid
Cap. www.proffice.com

Information in this interim report is such that Proffice AB (publ) is obligated
to disclose it pursuant to the Swedish Securities Markets Act. The information
was released for publication on 22 May 2014 at 8 am CET.