ITAB Shop Concept offers shop fi tting concepts for retail chain stores. ITAB will secure a market leading position in selected markets through its expertise and long-term strategies.
ITAB Shop Concept AB (publ) Box 9054
SE-550 09 Jönköping
Instrumentvägen 2 (Visiting address) Tel. +46 (0)36-31 73 00
info@itab.se www.itab.se
VINNA AB ITSC-009 Photo: Patrik Svedberg and others. Printed by: Vettertryck
2009 ANNUAL REPORT
IT AB ANNUAL REPOR T 2009
ITAB Shop Concept offers shop fi tting concepts for retail chain stores. ITAB will secure a market leading position in selected markets through its expertise and long-term strategies.
ITAB Shop Concept AB (publ) Box 9054
SE-550 09 Jönköping
Instrumentvägen 2 (Visiting address) Tel. +46 (0)36-31 73 00
info@itab.se www.itab.se
VINNA AB ITSC-009 Photo: Patrik Svedberg and others. Printed by: Vettertryck
2009 ANNUAL REPORT
IT AB ANNUAL REPOR T 2009
xxxxxxxxxxx 5 ANNUAL REPORT 2009
The beginning of the 21 century was marked by extreme expansion for ITAB through organic growth and strategic busi- ness acquisitions. The Group’s strength is its geographic proximity to its customers, making it possible to grow together. ITAB has one of the market’s strongest concept and product portfolios and an organisa- tion that has the experience and expertise to accommodate its customers' specific requirements and preferences. Customers are primarily the larger retail chain stores in the food and non-food business.
ITAB is the market leader in the Nordic countries, the Baltic countries and the UK and one of the largest in Central Europe and the Benelux countries. ITAB’s market
is divided into five sales areas: Scandinavia, UK & Ireland, Benelux, Central Europe and NorthEast.
The Group’s products are designed and manufactured at ITAB’s production facili- ties in Belgium, Finland, the Netherlands, Lithuania, Norway, the UK, Sweden, the Czech Republic, and Germany. Three of the facilities – ITAB Mertens in Belgium, ITAB Shop Concept CZ in the Czech Republic, and ITAB Harr in Germany – are part of ITAB Operations which supplies products only within the Group. In total ITAB has over 180, 000 m
2production area. At the turn of the year, the Group had 1,479 employees and sales totalled SEK 2,775.8 million in 2009.
Contents
INTRODUCTION, 2009 SUMMARY 3 About ITAB
4 Organisation chart 6 The year in brief 7 Important events
COMMENTS FROM THE CEO, BUSINESS CONCEPT, STRATEGY & GOALS, HISTORY
8 CEO’s comments
12 Business concept, strategies and goals 14 History and geographic expansion BUSINESS ACTIVITIES
16 Shop concept
16 Project management and working model 18 Shop fittings
20 Shop equipment MARKET AND ORGANISATION 22 The market
24 Organisation 27 Region Scandinavia 28 Region UK & Ireland 29 Region Benelux 30 Region Central Europe 31 Region Director NorthEast 32 ITAB Operations ENVIRONMENT AND QUALITY 34 Environment and quality FINANCIAL INFORMATION 37 Directors’ report
39 Proposal for the appropriation of profits THE GROUP
40 Income Statements
41 Statement of Comprehensive Income 42 Statement of Financial Position 44 Statement of Changes in Equity 45 Statement of Cash Flows PARENT COMPANY
46 Income Statements
46 Statement of Comprehensive Income 47 Statement of Financial Position 49 Statement of Changes in Equity 50 Statement of Cash Flows 51 Notes
71 Financial review – five years 72 Comments on financial performance 73 Auditors’ report
74 Share data, dividend policy and definitions 75 Trend in share capital, ownership structure 76 Corporate Governance Report
78 Board of directors, Group Management, Auditors
ADDRESSES, ANNUAL GENERAL MEETING 2010 80 Addresses
81 Annual General Meeting 2010 81 Financial information for 2010
Business areas ITAB Shop Concept sells, develops, manufactures and installs shop fittings and shop equipment, including checkouts and entrance systems for the food and non-food segments.
Geographic presence today
z Market with own organisation z Market presence
Executive Committee
Group Management, Region Directors, Director ITAB Operations
ITAB Operations Scandinavia
Jönköping, Sweden ITAB Shop Concept Nässjö, Sweden ITAB Shop Concept Alleröd, Denmark ITAB Shop Concept Oslo, Norway ITAB Shop Concept Lindco
KB-Design Stadsbygd, Norway ITAB Industries
Hemel Hempstead,UK ITAB Shop Products ITAB UK
ITAB Interiors Gravesend, UK ITAB UK
Woudenberg, Holland ITAB Shop Concept Veenendaal, Hollland ITAB Shop Concept Antwerp, Belgium ITAB Belgium
Cologne, Germany ITAB Germany Boscovice, Czech Rep.
ITAB Czech Republic Warsaw, Poland ITAB Polska Budapest, Hungary ITAB Hungary
Järvenpää, Finland ITAB Shop Concept Lahti, Finland ITAB Pan-Oston Tallin, Estonia ITAB Sisustus Riga, Latvia ITAB Baltic Vilnius & Kaunas, Lithuania ITAB Novena St. Petersburg, Russia
ITAB Shop Concept Russia
Kiev, Ukraine ITAB Shop Concept Ukraine
UK & Ireland Benelux Central Europe NorthEast
ITAB Shop Products
ITAB Scanflow
ITAB Pharmacy Concepts Jönköping, Sweden Jönköping, Sweden Antwerp, Belgium ITAB Mertens Boscovice, Czech Rep.
ITAB Shop Concept CZ Niedergurig, Germany ITAB Harr
Stockholm, Sweden PharmaService Sintek
Sandefjord, Norway PharmaService
Koncernledning
VD, vVD, Ekonomichef
Executive Committee
Koncernledning, regionchefer
Moderbolag
Jönköping, Sverige
ITAB Operations
Region
Scandinavia
Jönköping Nässjö Stockholm Alleröd Oslo Stadsbygd
Hemel Hempstead Gravesend
Woudenberg Antwerpen sälj
Köln Boscovize sälj
Järvenpää Lahti Tallin Riga Vilnius Kaunas St. Petersburg Kiev Region
UK and Ireland
Region
Benelux
Region
Central Europe
Region
NorthEast
ITAB Shop Products
ITAB SCO
ITAB Pharmacy Concepts Stockholm
Sandefjord Jönköping Jönköping Antwerpen prod.
Boscovize prod.
Niedergurig prod.
Parent company
Jönköping, Sweden
Group Management
CEO, deputy CEO, CFO
Organisation chart
About ITAB
ITAB sells, develops, manufactures and installs shop fitting concepts and products for chain stores. Customers include the major players in both the food and non-food segments throughout most parts of Europe. ITAB has organisations in 16 countries and eleven production facilities. ITAB Shop Concept is listed on OMX Nordic Exchange Mid Cap in Stockholm.
GERMANY ITAB Germany Gmbh Bonner Str. 324 D-50968 Cologne Tel: +49-221 376 33 0 Fax: +49-221 376 33 99 info@itab-germany.de www.itab-germany.de ITAB Harr GmbH Dr. Helmut Weidelener Allee D-02694 Malschwitz OT.
Niedergurig Tel: +49-3591 2185 0 Fax: +49-3591 2185 11 info@itab-harr.eu www.itab-harr.eu
POLAND
ITAB Shop Concept Polska Wspólna Droga Str. 4 PL-05-850 Jawczyce (Warsaw) Tel: +48-662 867 790 info@itab.pl
UKRAINE
ITAB Shop Concept Ukraine Tel: +38 044 585 7810 (Ukraine) Tel: +371 283 283 41 (Latvia) Fax: +38-044 585 7810 www.itab.org.ua
CZECH REPUBLIC ITAB Czech Republic s.r.o.
Chrudichromska 19 CZ-680 01 Boskovice Tel: +420-516 805 855 Fax: +420-516 805 898 info@itab.cz
www.itab.cz
ITAB Shop Concept CZ a.s Chrudichromska 19 CZ-680 01 Boskovice Tel: +420-516 805 900 Fax: +420-516 805 901 info@itab.cz
www.itab.cz
HUNGARY ITAB Hungary Tel: +420-516 805 900 (Czech Republic) Fax: +420-516 805 901 (Czech Republic)
RUSSIA
ZAO ITAB Shop Concept Russia
V.O. 18 Liniya 31, office B 423 RU-199 178 St. Petersburg Tel: +7-812 332 75 40 Fax: +7-812 332 75 41 itab@itab.ru
www.itab.se
The Annual General Meeting will be held on Wednesday, 05 May 2010 at 3 p.m. at ITAB’s offices on Instrument vägen 2 in Jönköping, Sweden.
NoTIfIcATIoN of pArTIcIpATIoN.
Shareholders wishing to participate in the Annual General Meeting shall be registered in the shareholders register maintained by the securities register centre Euroclear Sweden AB (formerly VPC AB) on Wednesday 28 April 2010 and shall notify the company of their intention to participate in the Meeting not later than 4 pm on Wednesday, 28 April 2010 to the address ITAB Shop Concept AB, Box 9054, SE-550 09 Jönköping, by phone +46-36 31 73 00 or by email info@itab.se.
The notification is to include the participant’s name, social security number/corporate identity number, address, daytime telephone number and the number of owned shares.
Shareholders whose shares are registered in the names of trustees must have their shares re-registered temporarily in their own names before Wednesday 28 April 2010 to be eligible to participate in the Meeting.
DIvIDeNDS. The Board of Directors pro- poses a dividend of SEK 1.25 per share.
The record date will be Monday 10 May 2010. Subject to the Meeting’s approval of the proposal, it is expected that dividends will be remitted by Euroclear Sweden AB on Thursday, 14 May 2010.
NoMINATIoN coMMITTee. At the 2009 AGM, a Nomination Committee was appoint- ed comprising Ulf Gustafsson as Chairman, Lars Persson and Johan Rapp. The Nomina- tion Committee’s task for the 2010 AGM is to propose candidates for Chairman of the Board and Board members, for the post of meeting chairman and auditors, as well as fees and other remuneration for the Board and auditors.
AGeNDA. The Meeting will address the issues that the Swedish Companies Act and the Articles of Association require be brought before an Annual General meeting, such as presentation of the annual report and auditors’ report, resolutions on the adoption of the income statements and balance sheet, discharge from liability for Board members and the Managing Director, and the election of Board members. Other matters are pre- sented in the agenda which will be sent in connection with the invitation to the Annual General Meeting.
Financial information for 2010
Interim report, January - March 5 May Annual General Meeting 2010 5 May Interim report, January - June 9 July Interim report, January - September 27 Oct Year-end report 2010 9 Feb Annual report 2010 March/April Annual General Meeting 2011 May
Annual General Meeting
The beginning of the 21 century was marked by extreme expansion for ITAB through organic growth and strategic busi- ness acquisitions. The Group’s strength is its geographic proximity to its customers, making it possible to grow together. ITAB has one of the market’s strongest concept and product portfolios and an organisa- tion that has the experience and expertise to accommodate its customers' specific requirements and preferences. Customers are primarily the larger retail chain stores in the food and non-food business.
ITAB is the market leader in the Nordic countries, the Baltic countries and the UK and one of the largest in Central Europe and the Benelux countries. ITAB’s market
is divided into five sales areas: Scandinavia, UK & Ireland, Benelux, Central Europe and NorthEast.
The Group’s products are designed and manufactured at ITAB’s production facili- ties in Belgium, Finland, the Netherlands, Lithuania, Norway, the UK, Sweden, the Czech Republic, and Germany. Three of the facilities – ITAB Mertens in Belgium, ITAB Shop Concept CZ in the Czech Republic, and ITAB Harr in Germany – are part of ITAB Operations which supplies products only within the Group. In total ITAB has over 180, 000 m
2production area. At the turn of the year, the Group had 1,479 employees and sales totalled SEK 2,775.8 million in 2009.
Contents
INTRODUCTION, 2009 SUMMARY 3 About ITAB
4 Organisation chart 6 The year in brief 7 Important events
COMMENTS FROM THE CEO, BUSINESS CONCEPT, STRATEGY & GOALS, HISTORY
8 CEO’s comments
12 Business concept, strategies and goals 14 History and geographic expansion BUSINESS ACTIVITIES
16 Shop concept
16 Project management and working model 18 Shop fittings
20 Shop equipment MARKET AND ORGANISATION 22 The market
24 Organisation 27 Region Scandinavia 28 Region UK & Ireland 29 Region Benelux 30 Region Central Europe 31 Region Director NorthEast 32 ITAB Operations ENVIRONMENT AND QUALITY 34 Environment and quality FINANCIAL INFORMATION 37 Directors’ report
39 Proposal for the appropriation of profits THE GROUP
40 Income Statements
41 Statement of Comprehensive Income 42 Statement of Financial Position 44 Statement of Changes in Equity 45 Statement of Cash Flows PARENT COMPANY
46 Income Statements
46 Statement of Comprehensive Income 47 Statement of Financial Position 49 Statement of Changes in Equity 50 Statement of Cash Flows 51 Notes
71 Financial review – five years 72 Comments on financial performance 73 Auditors’ report
74 Share data, dividend policy and definitions 75 Trend in share capital, ownership structure 76 Corporate Governance Report
78 Board of directors, Group Management, Auditors
ADDRESSES, ANNUAL GENERAL MEETING 2010 80 Addresses
81 Annual General Meeting 2010 81 Financial information for 2010
Business areas ITAB Shop Concept sells, develops, manufactures and installs shop fittings and shop equipment, including checkouts and entrance systems for the food and non-food segments.
Geographic presence today
z Market with own organisation z Market presence
Executive Committee
Group Management, Region Directors, Director ITAB Operations
ITAB Operations Scandinavia
Jönköping, Sweden ITAB Shop Concept Nässjö, Sweden ITAB Shop Concept Alleröd, Denmark ITAB Shop Concept Oslo, Norway ITAB Shop Concept Lindco
KB-Design Stadsbygd, Norway ITAB Industries
Hemel Hempstead,UK ITAB Shop Products ITAB UK
ITAB Interiors Gravesend, UK ITAB UK
Woudenberg, Holland ITAB Shop Concept Veenendaal, Hollland ITAB Shop Concept Antwerp, Belgium ITAB Belgium
Cologne, Germany ITAB Germany Boscovice, Czech Rep.
ITAB Czech Republic Warsaw, Poland ITAB Polska Budapest, Hungary ITAB Hungary
Järvenpää, Finland ITAB Shop Concept Lahti, Finland ITAB Pan-Oston Tallin, Estonia ITAB Sisustus Riga, Latvia ITAB Baltic Vilnius & Kaunas, Lithuania ITAB Novena St. Petersburg, Russia
ITAB Shop Concept Russia
Kiev, Ukraine ITAB Shop Concept Ukraine
UK & Ireland Benelux Central Europe NorthEast
ITAB Shop Products
ITAB Scanflow
ITAB Pharmacy Concepts Jönköping, Sweden Jönköping, Sweden Antwerp, Belgium ITAB Mertens Boscovice, Czech Rep.
ITAB Shop Concept CZ Niedergurig, Germany ITAB Harr
Stockholm, Sweden PharmaService Sintek
Sandefjord, Norway PharmaService
Koncernledning
VD, vVD, Ekonomichef
Executive Committee
Koncernledning, regionchefer
Moderbolag
Jönköping, Sverige
ITAB Operations
Region
Scandinavia
Jönköping Nässjö Stockholm Alleröd Oslo Stadsbygd
Hemel Hempstead Gravesend
Woudenberg Antwerpen sälj
Köln Boscovize sälj
Järvenpää Lahti Tallin Riga Vilnius Kaunas St. Petersburg Kiev Region
UK and Ireland
Region
Benelux
Region
Central Europe
Region
NorthEast
ITAB Shop Products
ITAB SCO
ITAB Pharmacy Concepts Stockholm
Sandefjord Jönköping Jönköping Antwerpen prod.
Boscovize prod.
Niedergurig prod.
Parent company
Jönköping, Sweden
Group Management
CEO, deputy CEO, CFO
Organisation chart
About ITAB
ITAB sells, develops, manufactures and installs shop fitting concepts and products for chain stores. Customers include the major players in both the food and non-food segments throughout most parts of Europe. ITAB has organisations in 16 countries and eleven production facilities. ITAB Shop Concept is listed on OMX Nordic Exchange Mid Cap in Stockholm.
GERMANY ITAB Germany Gmbh Bonner Str. 324 D-50968 Cologne Tel: +49-221 376 33 0 Fax: +49-221 376 33 99 info@itab-germany.de www.itab-germany.de ITAB Harr GmbH Dr. Helmut Weidelener Allee D-02694 Malschwitz OT.
Niedergurig Tel: +49-3591 2185 0 Fax: +49-3591 2185 11 info@itab-harr.eu www.itab-harr.eu
POLAND
ITAB Shop Concept Polska Wspólna Droga Str. 4 PL-05-850 Jawczyce (Warsaw) Tel: +48-662 867 790 info@itab.pl
UKRAINE
ITAB Shop Concept Ukraine Tel: +38 044 585 7810 (Ukraine) Tel: +371 283 283 41 (Latvia) Fax: +38-044 585 7810 www.itab.org.ua
CZECH REPUBLIC ITAB Czech Republic s.r.o.
Chrudichromska 19 CZ-680 01 Boskovice Tel: +420-516 805 855 Fax: +420-516 805 898 info@itab.cz
www.itab.cz
ITAB Shop Concept CZ a.s Chrudichromska 19 CZ-680 01 Boskovice Tel: +420-516 805 900 Fax: +420-516 805 901 info@itab.cz
www.itab.cz
HUNGARY ITAB Hungary Tel: +420-516 805 900 (Czech Republic) Fax: +420-516 805 901 (Czech Republic)
RUSSIA
ZAO ITAB Shop Concept Russia
V.O. 18 Liniya 31, office B 423 RU-199 178 St. Petersburg Tel: +7-812 332 75 40 Fax: +7-812 332 75 41 itab@itab.ru
www.itab.se
The Annual General Meeting will be held on Wednesday, 05 May 2010 at 3 p.m. at ITAB’s offices on Instrument vägen 2 in Jönköping, Sweden.
NoTIfIcATIoN of pArTIcIpATIoN.
Shareholders wishing to participate in the Annual General Meeting shall be registered in the shareholders register maintained by the securities register centre Euroclear Sweden AB (formerly VPC AB) on Wednesday 28 April 2010 and shall notify the company of their intention to participate in the Meeting not later than 4 pm on Wednesday, 28 April 2010 to the address ITAB Shop Concept AB, Box 9054, SE-550 09 Jönköping, by phone +46-36 31 73 00 or by email info@itab.se.
The notification is to include the participant’s name, social security number/corporate identity number, address, daytime telephone number and the number of owned shares.
Shareholders whose shares are registered in the names of trustees must have their shares re-registered temporarily in their own names before Wednesday 28 April 2010 to be eligible to participate in the Meeting.
DIvIDeNDS. The Board of Directors pro- poses a dividend of SEK 1.25 per share.
The record date will be Monday 10 May 2010. Subject to the Meeting’s approval of the proposal, it is expected that dividends will be remitted by Euroclear Sweden AB on Thursday, 14 May 2010.
NoMINATIoN coMMITTee. At the 2009 AGM, a Nomination Committee was appoint- ed comprising Ulf Gustafsson as Chairman, Lars Persson and Johan Rapp. The Nomina- tion Committee’s task for the 2010 AGM is to propose candidates for Chairman of the Board and Board members, for the post of meeting chairman and auditors, as well as fees and other remuneration for the Board and auditors.
AGeNDA. The Meeting will address the issues that the Swedish Companies Act and the Articles of Association require be brought before an Annual General meeting, such as presentation of the annual report and auditors’ report, resolutions on the adoption of the income statements and balance sheet, discharge from liability for Board members and the Managing Director, and the election of Board members. Other matters are pre- sented in the agenda which will be sent in connection with the invitation to the Annual General Meeting.
Financial information for 2010
Interim report, January - March 5 May Annual General Meeting 2010 5 May Interim report, January - June 9 July Interim report, January - September 27 Oct Year-end report 2010 9 Feb Annual report 2010 March/April Annual General Meeting 2011 May
Annual General Meeting
ANNUAL REPORT 2009 6 THE YEAR IN BRIEF
Share performance
ITAB Shop Concept is now listed on OMX Nordic Exchange Mid Cap.
z ITAB Shop Concept z OMX Stockholm PI
2009 summary
Income amounted to SEK 2,775.8 million
• (3,412.3).
Operating income amounted to SEK 114.2
•
million (194.8).
Income after financial items amounted to
•
SEK 90.0 million (140.2).
Earnings per share amounted to SEK 5.13
• (7.28)
2009 2008
Income SEK m 2,775.8 3,412.3
Operating income SEK m 114.2 194.8
Income for the year SEK m 73.5 102.9
Earnings per share SEK 5.13 7.28
Equity per share SEK 37.32 35.43
Dividends per share SEK 1.25
1)1.25
Return on equity % 14.2 23.6
Portion of risk-bearing capital % 40.3 35.6
Share price at the end of the period SEK 84.75 55.00
Average number of employees no. 1,555 1,658
1)
The Board’s proposal for dividends for 2009
The year in brief
The year was dominated by the financial climate and both sales figures and earnings were lower than previous years.
Nonetheless, ITAB has managed to enhance or retain its market position on markets where we are already active. A number of larger agreements were signed with players in the food and non-food segments, plus several smaller agreements of a more strategic nature during the year.
The Group in figures
THE YEAR IN BRIEF
2005 2006 2007 2008 2009
133.00 114.00 95.00 76.00 57.00 38.00 19.00
SEK
xxxxxxxxxxx 7 ANNUAL REPORT 2009
n BREAKTHROUGH ORDER FOR SELF-SCANNING 2009 opened with the signing of two significant agreements for the self-checkout system; one with City Gross in the Nordic countries and one with the Italian supermarket chain, Coop. The year closed with ITAB signing an agreement for a self-checkout system with Denmark-based LEGOLAND
®ApS owned by Merlin Entertainments Group.
n COORDINATED DELIVERIES FOR COOP
The company signed two agreements with the Nordic super- market chain, Coop, in the spring. The first is an exclusive two- year agreement to deliver checkouts to stores in Denmark, Nor- way and Sweden. The term of the agreement is 2009-2010 with the option to extend the agreement through 2011. The second agreement is for the delivery of shop fittings and entrance sys- tems to stores in Sweden, Denmark and Norway. This agree- ment has a term of 2.5 years, with the first delivery scheduled for the turn of the year, 2009/2010.
n EXTENDED AGREEMENT WITH THE VARNER GROUP The Norwegian Varner Group elected to extend its agreement for the supply of shop fitting concepts for the retail chain, Cubus.
The agreement is a three-year agreement, starting in 2010. ITAB will also design BikBok’s new shop fittings concept together with the Varner Group. This agreement is valid through 2011.
Pending possible expansion in the future, the Varner Group is favourably inclined to ITAB’s geographic presence in Europe.
n SHOP CONCEPT FOR STATOIL
Statoil Europe chose to extend its agreement for the supply of the company's new shop concept. This is a two-year agreement, for 2010 and 2011. Statoil Europe recognises the advantages of ITAB's geographic presence in Europe in terms of future expansion plans.
n NEW CUSTOMER IN FINLAND
Finnish non-food chain store, Kodin Terra, chose ITAB as its all-inclusive shop concept supplier in the autumn. This is a new customer relationship, one believed to have vast potential since Kodin Terra is the fastest growing do-it-yourself chain in Finland.
n BREAKTHROUGH ORDER - PHARMACIES
ITAB signed agreements at the end of the year with one of the largest international players for pharmacy fittings to the Swedish and Norwegian markets. This is a prominent order for ITAB and one of the first deliveries following the resolution to deregulate the Swedish pharmacy market.
n NEW PARTNERSHIPS
In 2009, ITAB signed agreements with Tesco Central Europe, Spar Belgium, John Lewis Stores in England and Rimi in the Baltic countries to supply shop fittings.
n EVENTS AFTER THE END OF THE PERIOD
At the beginning of 2010, ITAB signed a two-year partnership agreement with one of the largest ready-to-wear clothing chains in the Nordic region for complete shop concepts. Moreover, ITAB signed a two-year agreement with A.S. Watson Group, one of the world’s leading health & beauty retailers, for the supply, installation and service of shop fittings to most of the chain’s European shops.
Important events 2009
Impo R TANT E v ENT s
ANNUAL REPORT 2009 8 COMMENTS FROM THE CEO
According to my calculations, the Group’s de- clining volumes noted this year are significantly less than the market in general. Sales and earn- ings as a whole were however slightly lower than predicted. Sales were down 19% to SEK 2,775.8 million (3,412.3) while income after financial items fell 36% to SEK 90.0 million (140.2).
Despite the decline, we did maintain a good level of earnings. This is primarily attributable to the streamlining and restructuring improve- ments implemented over several years which are now generating lower costs.
Cash flow from operating activities in 2009 amounted to SEK 292 million. During the year, we improved the company’s gross margin, reduced tied-up capital and streamlined the organisation at several levels. The results of these efforts mean that we are ready to deal with the future, and we now have a competitive cost struc- ture that will promote a better earnings trend.
HIGHER MARKET SHARES
The Group was affected by overall business trends and the financial crisis throughout the year.
Market trends in our regions varied in 2009.
Scandinavia, NorthEast and Central Europe did well, despite the current recession, while the UK & Ireland and Benelux report poorer growth compared with last year. My estimates indicate however that we enhanced our market shares in 2009. The foremost reason for this is that most of our customers are large chain
CommENTs FRom THE CEo
CEO’s comments
2009 was a year dominated by the overall financial climate. While sales figures and earnings were lower than predicted, we have managed to enhance or maintain our position in our markets despite the current recession. Our geographical market presence combined with our effective production resources and talented, dedicated employees give us a unique position on the market and the best conditions for the future.
-05 -06 -07 -08 -09 Year 0
1,000 2,000 3,000 SEK m
-05 -06 -07 -08 -09 Year 0
50 100 150 SEK m
CEO Ulf Rostedt
Income after financial items
Sales
ANNUAL REPORT 2009 COMMENTS FROM THE CEO 9
CommENTs FRom THE CEo
stores in the food sector and the broader scale of the non-food sector, which have enjoyed relatively good, steady growth. The market as a whole shrunk slightly more than expected, creating an over capacity in terms of suppliers, resulting in tighter margins and squeezed prices.
The restructuring implemented in the autumn 2008 contributed to improving collaboration within the Group and a more effective utilisa- tion of resources. It is clearly evident the extent to which the organisation-wide working model and strategy has permeated the Group.
MANY NEW AGREEMENTS
In 2009, we signed several larger customer agreements with companies like Coop, Statoil Europe and the Varner Group. At the end of the year, Svenska Apoteket AB announced the details regarding the sales of the state-owned pharmacies. In connection with this, it is now possible to sell over-the-counter drugs in food stores. Deregulation of the Swedish pharmacy market will mean several new players on this market. We have planned for and monitored developments carefully over an extended period, and have consequently signed agreements with several pharmacy chains.
UNIQUE SELF-CHECKOUT SYSTEM ITAB is today the only player in the shop fittings sector that has its own in-house designed self-checkout system. Our system gives the customer better access and safety, reduces losses and provides excellent opportunities to streamline employee costs. 2009 signalled a breakthrough for ITAB's self-checkout system.
Throughout the year, several strategically im- portant agreements were signed with companies like the supermarket chain Coop in Italy, Nordic City Gross, Danish Legoland ApS. The market for checkout solutions faces a major restructur- ing process, and we are negotiating with most of the larger retail chains in our markets.
ITAB ACADEMY
ITAB Academy, an internal training programme, started in 2009. Some thirty Group employees will have the opportunity to improve their knowledge about ITAB’s business operations and strategies, as well as their leadership abilities, over the course of one year. The programme also addresses topics like business acumen, business intelligence and market trends. This is a crucial step, both short and long term, in augmenting Group affiliation and networking as well as our future management.
SCANDINAVIA: REINFORCED MARKET POSITION Despite the current market situation, the region grew in line with expectations in 2009.
The region’s food sector has proven to be less sensitive to the business climate, but even our larger customers in the non-food sector report satisfactory growth. All of our companies in the region report grown that surpasses the market in general.
ITAB carried out an internal reorganisation in Sweden. Our company in Nässjö is now responsible for concept sales, while the company in Jönköping will focus on product sales like checkouts and entrance systems. The reorganisa- tion is aimed at streamlining our working model even further in order to offer the market an even better partner.
In Denmark, we phased out production in Jylland and intensified our collaboration with the Group’s other companies, particularly our factory in Jönköping. This is necessary to give the Danish market required service and capacity.
In all, we worked diligently throughout 2009 to modify and improve our organisation so that we can face the future with even greater confidence.
UK & IRELAND: TOUGH MARKET
The region’s food sector continued to invest in 2009, but at a slower pace. This market also
“During the year, we managed to improve the company’s gross margin, reduce tied-up capital and streamline the organisation at several levels.
The results of these efforts mean that we are ready to deal with the future, and we now have a competitive cost structure that will promote a better earnings trend.”
E
ANNUAL REPORT 2009 10 COMMENTS FROM THE CEO
faces severe competition at product level. The current recession had a greater impact on the non-food sector and many construction projects were postponed or cancelled due to a general lack of confidence and slashed bank credit. Although the region reports lower volume for 2009, it retained market shares on a shrinking market.
We also strengthened our competitiveness after the past years' internal structural modifications and cost reductions. The organisation is geared toward focusing on customer and market trends to a greater extent in order to present our cus- tomers with a more comprehensive all-inclusive offer. We have made a lot of progress, but we have many challenges ahead of us.
BENELUX: FALLING VOLUMES
The region reports lower sales volumes com - pared with last year as a result of 2009's eco- nomic climate. The organisation in Belgium has worked diligently to map potential customers.
Over the past months, we have observed posi- tive effects of this incentive. ITAB reinforced its position in Belgium in 2009 and laid a solid foundation for future growth. Our Dutch organisation doubled its production and logis- tics facilities, a necessary measure if we are to serve our customers more effectively. Also our Dutch wood factory has launched an improve- ment project. We have good relations with our largest customers in the market, which should ensure future stability and favourable growth.
CENTRAL EUROPE: NEW ORGANISATIONS The East European market, with the exception of Poland, was severely hit by the economic climate in 2009. Also the German market was affected, though not to the same extent as other countries. This resulted in fewer investments in Eastern Europe and severely pressed prices. In Germany, our current customers opted to invest less than normal, which means lower volumes.
These customers have however been intro- duced to a greater range of products and con- cepts compared with previously, which paid off.
The process of signing new customers has not been as successful, probably due to the market's prolonged sales process. During the period, we set up our own organisations in Hungary and Poland. We will focus more on the Polish market in particular in the immediate future.
NORTHEAST: STABLE GROWTH
The region reports good growth for 2009, particularly in the Baltic countries since the larger supermarket chains continue to invest.
The acquisition of Finland-based PanOston carried out in 2008 further strengthened our position as the market leader in the Finnish food sector. Business activities in Russia made slow, but steady progress and we have built up a strong installation and service organisation in St. Petersburg. The agreement signed with Kodin Terra at the end of the year was in many ways a breakthrough. Not only does it involve deliveries to a new customer segment, but also the first installation of our warehouse fittings system in Finland. The warehouse fittings system will in future be marketed and sold within the entire Group.
POSITIONED FOR TOMORROW
The market situation today feels more stable than during 2009 and we note more movement in the markets. We are carefully optimistic about the year to come and expect to see the traditional seasonal pattern of a calm start fol- lowed by gradually climbing volumes. Although sales figures and earnings were lower than pre- dicted, we managed to strengthen or uphold our market positions despite the current recession.
We also managed to sustain a good level of earn- ings. Streamlining and restructuring initiatives have been implemented during the past years which have lowered costs. Together with the Group consolidation, these proved in many ways to be imperative and positive after a number of years of extreme growth. We are well prepared for more growth when the occasion arises, both in the form of organic and acquisition-driven
“We are distinctly positioned in our select geographic markets, both in terms of expertise and organisation.
This is the basis of our business activities and our platform for con-
tinued growth.”
E
CommENTs FRom THE CEo
ANNUAL REPORT 2009 COMMENTS FROM THE CEO 11
expansion. The market is highly competitive and at present, suppliers have an over capacity.
This can lead to restructuring in the form of mergers and shut-downs, which by extension can provide new acquisition opportunities.
Our primary ambition is to further reinforce our position in the markets where we are active today.
Our customers’ shop fittings concepts will in future have a shorter lifecycle, which means that demands for fast turn-around and roll-outs will increase. This will lead to a market that has a higher rate of development and higher demands in general, factors that coincide perfectly with our strategy and working model.
Our strength lies in the combination of a well designed concept and product portfolio, and geographic proximity to our customers that enables us to expand together. We are distinctly positioned in our selected geographic markets, both in terms of expertise and organi- sation. This is the basis of our business activities and our platform for continued growth. We are monitoring with great interest the deregulation of the Swedish pharmacy market, and the advances of our self-checkout system, a field in which we expect to see good sales progress.
Together with our geographical presence and organisational structure, we have a modern,
expedient production apparatus that is highly effective and can accommodate greater volumes with minor investments. Our factories are stra- tegically located in proximity to our customers.
I want to take the opportunity to thank our customers, partners and employees for the confidence you have shown ITAB. The future brings with it demands for more expertise, a faster rate of change and the ability to be flexible in all areas. I am fully confident that ITAB will excel in delivering this to both existing and new customers, and thereby serve as a sound, stable and strategic partner.
Ulf Rostedt CEO
“We are monitoring with great interest the deregulation of the Swedish pharmacy market, and the advances of our self-checkout system, a field in which we expect to see good sales progress.”
CommENTs FRom THE CEo
ANNUAL REPORT 2009 12 BUSINESS CONCEPT, STRATEGIES AND GOALS
BUSINESS CONCEPT
ITAB Shop Concept’s business concept is to offer shop fitting concepts for retail chain stores.
ITAB will secure a market leading position on selected markets through its expertise and long- term strategies.
STRATEGY
• ITAB will develop and nurture long-term business relations with chain stores in the food and non-food sector by working closely with its customers and their markets.
• The competence, commitment and business- like attitude that characterises the Group will instil trust and confidence in each and every customer.
• ITAB will offer all-inclusive solutions by assuming responsibility for the entire flow – from concept, design, project management and construction to production, logistics and instal- lation.
• ITAB will develop new concepts, products and solutions by utilising its extensive market expertise and innovativeness while working closely with its customers.
• ITAB will use its highly efficient and flexible production resources, thorough logistics process and selected partners to offer the market com- petitive terms coupled with precise delivery accuracy and quality.
• ITAB will use its leading position in Northern Europe to create the conditions for further growth and expansion in other selected markets.
ITAB’s well established working model ensures security for the customer and drives projects from the concept phase to turnkey shops.
BUsINEss CoNCEpT, sTRATEGIEs AND GoALs
Business concept, strategies and goals
ITAB Shop Concept sells, develops, manufactures and installs shop fittings and shop equipment like checkouts and entrance
systems for the food and non-food segments.
ANNUAL REPORT 2009 BUSINESS CONCEPT, STRATEGIES AND GOALS 13
Business goals
Financial goals
Growth goals Description Realisation
ITAB will have an average of 15% growth per year over an extended period.
The target includes both organic and acquired growth. Organic growth will be accomplished through greater market shares and product development. Acquisitions will be made of both complementary businesses and in new markets.
Sales dropped by about 19% in 2009.
Over the past five year, average growth was about 22% per year.
ITAB will maintain its position as market leader in the Nordic, Baltic and UK markets.
This goal is linked to ITAB’s business concept, which states: “ITAB will secure a market leading position on selected markets through its expertise and long-term strategies.”
ITAB had a market leading position in 2009 in all of these regions. Over the past five years, the goal was realised in the Nordic countries every year, while the Baltic and UK market achieved the position mid period.
ITAB will become the market leader in the Benelux countries and Central Europe.
This goal is linked to ITAB’s business concept, which states: “ITAB will secure a market leading position on selected markets through its expertise and long-term strategies.”
ITAB is one of the five largest players in these regions.
ITAB will develop and gain market shares on new European markets.
The goal can be realised by setting up orga- nisations in new markets, developing current business activities or through acquisition.
ITAB set up operations in Hungary and Poland in 2009. Over the past five years, new markets for ITAB included the UK, parts of the Baltic market, parts of Benelux and parts of Central Europe.
Russia and the Ukraine emerged as new markets during the five-year period.
Goals Description Realisation
Return on equity Over an extended period, ITAB will have a minimum 20% return on equity.
Generating good return on equity is a critical goal for ITAB. The level has been determined with consideration to ITAB’s capital structure and expected earning capacity.
In 2009, return on equity reached 14.2%. Over the past five years, return on equity averaged about 24%.
Risk-bearing capital ITAB will have at least 25%
cent risk-bearing capital.
The risk-bearing capital goal should be viewed as an expression of the lowest acceptable level in terms of a stable financial position.
The proportion risk-bearing capital was 40.3% at 31 December 2009.
Over the past five years, the proportion risk-bearing capital varied between 26 and 40%.
Dividends
ITAB’s share dividends will, over an extended period, mirror the company’s profits and correspond to 20–30%
of the company’s profit after tax. Dividends will, however, be adapted to the company’s investment needs and any share repurchase schemes.
The goal has been set to ensure a stable financial situation for continued expansion while concurrently giving shareholders a reasonable portion of the profits.
The proposed dividend for financial year 2009 is SEK 1.25, which corresponds to 24% of the earnings per share. Over the past five years, the dividend proportion varied between 15 and 24%. The primary reason why the goal has not been met in full is ITAB’s intense expansion during the period.
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BUsINEss CoNCEpT, sTRATEGIEs AND GoALs
ANNUAL REPORT 2009 14 HISTORY AND GEOGRAPHIC EXPANSION
Through strategic and long-term planned ex- pansion, ITAB is today one of Europe's leaders in shop fittings and shop equipment. The Group is the market leader in the Nordic countries, the UK and the Baltic countries and one of the
largest in Central Europe and the Benelux coun- tries. ITAB’s market position stems from a broad geographic spread, in-house production, an assiduous concept and product portfolio and a fine-tuned project management model.
1990-1997
ITAB Industri acquires the shop fittings company ABO Metal (currently ITAB Shop Concept Jönköping), a lead- ing Swedish checkout supplier and Legra (currently ITAB in Norway), one of the largest Norwegian actors in shop fittings.
ITAB also acquires a Danish check- out manufacturer, a Finnish shop fittings company and the Nordic region’s largest entrance systems company.
1998-2002
The organisation focuses on shop concepts complete with fittings and equipment. The companies in Swe- den, Norway, Denmark and Finland form the business area ITAB Inred- ning to become the market leader in the Nordic countries.
The company’s growth strategy and ambition to work closely with its customers influences its expan- sion. With the larger chains follows production of standard fittings. One of these chains is the Ahold Group, which leads to the acquisition of companies in the Netherlands and in Baltic countries.
2003-2005
ITAB Inredning follows its larger customers into the Czech Republic and acquires a sales organisation in the region. The organisation is hived off from ITAB Industri and forms the Group ITAB Shop Concept which is listed on First North on OMX Nordic Exchange. Two business acquisitions in the Czech Republic, Apos and ABL, are central for establishment and further expansion in Central Europe and Benelux. Other acquisi- tions include Swedish Stenestams Industri and Norwegian Lindco AS.
During the period the business is consolidated, which involves the merger of the Czech companies.
2006
With the acquisitions of the shop fittings group City Group and the shop equipment company Radford CGC ITAB moves into the UK market. Sales in the UK climb from SEK 0 to 500 million.
Acquisitions during the year include the Lithuanian interior deco- rating company Novena complete with one of the largest produc- tion units in the Baltic region, the Norwegian pharmacy fittings com- pany, PharmaService, and the Dutch project management company, PremOers.
1998 2004 2006 2008
HI s T o R Y
Strategic expansion
in select parts of Europe
The beginning of the 21 century was marked by extreme expansion for ITAB through organic growth and strategic business
acquisitions. The Group has deliberately and gradually grown into one of Europe’s strongest players with an impressive market
presence.
ANNUAL REPORT 2009 HISTORY AND GEOGRAPHIC EXPANSION 15
2007
The newly built production facility in Boskovice in the Czech Republic is taken into operation. ITAB’s produc- tion capacity for standard fittings and checkouts triples.
The same year, one of Sweden’s leading actors in pharmacy fittings, Sintek, is acquired.
2008
ITAB acquires Hansa Kontor Shop- fitting Group, thereby moving into the German market while simultaneously reinforcing its position in the UK.
The same year, Finnish check out supplier Pan-Oston, Dutch Scan- gineers which designs software sys- tems for self-scanning and Swedish L-Form, entrance and queue manage ment systems manufacturer are acquired.
ITAB divides its operations into five sales regions and one production division.
Three new companies are formed:
ITAB Shop Products, ITAB Scanflow and ITAB Pharmacy Concepts.
Transfer to OMX Nordic Exchange Mid Cap in Stockholm is carried out.
2009
ITAB is now the leading European checkout manufacturer and second largest in complete shop fitting con- cepts and entrance systems.
ITAB is affected by the preva- lent economic climate. The Group manages however to uphold or reinforce its market position on all its markets.
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HI s T o R Y
Geographic presence today
z Market with own organisation
z Market presence
ANNUAL REPORT 2009 16 BUSINESS ACTIVITIES
All-inclusive shop concepts and in-house designed products
A shop concept comprises all types of fittings and equipment intended for displaying and storing goods. To meet the needs of the market, ITAB has for many years strategically improved its concept and product portfolio, which includes both highly competitive standard products and its own, unique products.
ITAB has extensive experience of working as an all-inclusive contractor in charge of building new or refurbishing individual shops or entire chains of stores.
Effective project management
The Group’s five sales regions conduct all projects in line with a defined working model. Project management can involve parts or all stages of the model. When entire shop concepts are created, all parts of the model are usually adopted in a close collaboration with the customer. When designing individual products, the customer is involved in the process at a later date.
The idea phase
• entails close collaboration between the customer’s representatives and various experts from ITAB.
Design
• is performed by ITAB’s designers based on the customer’s profile and sales strategy. The Group has both in-house, local design teams and larger design centres in Cologne and Oslo.
The construction process
• is carried out using
3D CAD systems that minimise development times and provide support in the decision- making and production processes.
Production
• takes place in ITAB’s own produc- tion facilities, both locally and centrally, depend- ing on the product’s design and transport specifications. The Group’s eleven production facilities have a total area of 180,000 m
2. ITAB sells, develops, manufactures and installs shop concepts for major retail chain stores within the food and non-food segments throughout most parts of Europe. The Group’s market position stems from a broad geographic spread, in-house production facilities, an assiduous concept and product portfolio and a fine-tuned project management model.
BU s INE ss ACTI v ITIE s
“To meet the needs of the market, ITAB has for many years strategically improved its con- cept and product
portfolio, which
includes both
highly competitive
standard products
and its own, unique
products.”
ANNUAL REPORT 2009 BUSINESS ACTIVITIES 17
BU s INE ss ACTI v ITIE s
E
Turnkey shops
Further development
Concept phase
Design
Construction
Logistics
Project management
Production Installation and
service
Logistics
• are critical in carrying out the projects.
Production planers and purchasing net- works collaborate on purchasing expenditure, schedules and optimising transportation.
Installation and service
• is carried out by ITAB's
own technicians or certified installation teams.
Installations can be done in the shop while business is in progress. ITAB’s service team can provide service and maintenance of both fittings and equipments through regular visits.
Turnkey shops
• , ITAB conducts the project from start to finish. When the last screw is in place the customer has a finished product, a new concept or a complete shop ready for business.
Further development
• , new ideas and needs of-
ten crop up while working on a shop concept.
These are smoothly implemented thanks to our coordinated project management function and a highly functional working model.
FLEXIBLE, IN-HOUSE PRODUCTION ITAB offers a combination of local, flexible pro- duction units and central volume production through ITAB Operations. The Group has eleven production facilities with a total area of 180,000 m
2.
Three of these are part of ITAB Operations:
ITAB Mertens in Belgium, manufactures
•
custom-made shop fittings.
ITAB Shop Concept CZ in the Czech
•
Republic, manufactures standard metal fittings and checkouts.
ITAB Harr in Germany, manufactures
•
checkouts.
Other production units are in Finland, Holland,
Lithuania, Norway, Sweden and the UK. These
units are adapted to the region’s specific needs.
ANNUAL REPORT 2009 18 BUSINESS ACTIVITIES
ITAB enhances its presence and service in vari- ous markets through a network of installation and maintenance partners. The company’s pro- duction is primarily made-to-order but also covers warehousing of select standard products.
For customers with short set-up periods, ITAB manufactures and stocks a number of complete shops for immediate delivery.
STRONG SUPPLIER RELATIONS
ITAB’s concept and product solutions are made up of many different materials that can vary for each customer-unique concept. Consequently, ITAB has a long-established, broad supplier net- work in which relationships are distinguished by competence and progressive partnership, from raw materials to end customers.
Purchasing expenditure for the Group’s volume purchases are controlled by a central purchasing and logistics function. ITAB has an effective purchasing organisation capable of acting both centrally and locally.
ITAB has a number of suppliers who do busi- ness in Asia. In September 2008, ITAB there- fore opened a purchasing office in Suzhou, out- side Shanghai, China, from which purchases, quality and parts of the logistics process can be controlled on site.
Shop fittings
Shop fittings sales with project management, installation and service account, for more than 75 per cent of ITAB’s turnover. The basic range comprises standard fittings, in addition to which ITAB offers custom-made fitting details that re- flect the customer’s profile. ITAB also provides completely custom-made fittings.
CUSTOM-MADE
AND STANDARDISED FITTINGS
The concept of shop fittings comprises all types of fittings intended for displaying and storing
BU s INE ss ACTI v ITIE s
E
ANNUAL REPORT 2009 BUSINESS ACTIVITIES 19
BU s INE ss ACTI v ITIE s
E goods. The product segments spans from the
complete shop interior to individual compo- nents such as shelves, consoles and product stands. Customised fittings are an important part in retail chain stores' profiles and brand name strategies.
Products are made mainly of metal, wood, plastic and glass. The food segment uses both standardised systems and fittings custom-made for a particular customer or product category.
Standard fittings have exact measurements and are assembled and mounted according to a given system. Which solutions are used varies from market to market, and between different retail chains. ITAB has therefore designed a broad range of standard fittings.
Fittings for the non-food segment are usually unique to each chain. The shape, colour and choice of material for shelves and product stands emphasise the store’s profile in harmony with colour schemes and lighting.
ITAB sells, develops and manufactures
special fittings for pharmacies and hospitals in the form of system solutions like carousels and cartridges.
ITAB is currently the largest in shop fittings
in the Baltic, Nordic and UK markets, and one
of the leading players in Benelux and Central
Europe. Marketing and sales activities are con-
ducted foremost through ITAB’s own compa-
nies but also via our European partners.
ANNUAL REPORT 2009 20 BUSINESS ACTIVITIES
Shop equipment
Shop equipment sales account for about 25%
of ITAB’s turnover. ITAB has its own in-house product development in order to adapt its prod- uct portfolio to the customer needs on the vari- ous markets.
CHECKOUTS
ITAB sells, manufactures and supplies check- outs to larger retail chain stores, primarily in the food sector. A well-functioning checkout system with a quick throughput of goods facilitates the payment process and contributes to good cus- tomer contact and a positive impression of the store. As Europe's leading supplier, ITAB has the experience and expertise to help retail chains choose the right equipment based on the shop’s size, flow of goods and number of visitors.
How checkouts are designed varies between different countries and is influenced by the shop's size and layout. Shops in urban areas re- quire space-efficient and functional solutions, while supermarkets on the outskirts of town can
prioritise larger facilities for a quick flow of customers. ITAB’s checkouts are optimised based on the shop’s flow of customers and goods. For shops that stock a lot of products and where speed is a decisive factor, ITAB manufactures highly effective, ergonomic checkout systems equipped with conveyor belt scales and patented third- customer features. The latter
feature means that a third customer can start its purchase while the two previous customers are still packing. ITAB supplies com-
pact checkout systems for smaller shops.
ITAB’s checkouts are adapted for different cash register and payment systems and ITAB is the largest checkout supplier in Europe today.
Marketing and sales activities are conducted through ITAB’s own companies plus a network of partners in large parts of Europe.
SELF-CHECKOUT SOLUTIONS
The market’s interest in new methods for reliable checkout and payment in shops continues to increase. As an alternative to staffed checkouts, ITAB has therefore developed self-checkout solutions. Self-checkout gives the consumer a way to quickly and conveniently check out and scan their items themselves at the checkout.
The concept includes also products for cash payment, customer support, surveillance and exiting. The system means better access, frees up staff and reduces losses compared with other known systems today. It also saves shop space and makes room for more goods and exit check- outs, which means shorter queues.
The self-checkout solutions are available in two alternatives: one for an intense flow of goods and one suitable for customer baskets and a few items.
The software is compatible with all known POS systems today. ITAB’s self-checkout system and market position in the checkout sector consti- tute an exceptionally competitive combination.
ENTRANCE SYSTEMS
ITAB is Europe’s second largest supplier of en- trance systems on the market today. The Group develops, manufactures and markets entrance gates marketed in a number of varieties complete with various accessories. The entrance solutions are designed for flexibility in open or closed sys- tems via radar or photocell-controlled openings.
There is a wide selection of options in terms of design, material and colours.
ITAB’s entrance and queue management systems are developed, manufactured and mar- keted in the independent company, ITAB Shop Products. This company is the result of a merger of ITAB’s entrance systems organisations in the UK and Sweden.
»A well-functioning checkout system with a quick throughput of goods facilitates the payment process and contributes to good customer contact and a positive impression of the store.«
BU s INE ss ACTI v ITIE s
E
xxxxxxxxxxx 21 ANNUAL REPORT 2009
BU s INE ss ACTI v ITIE s
ANNUAL REPORT 2009 22 THE MARKET
Market presence allows proximity to customers
ITAB sells, develops, manufactures and installs shop concepts and equipment for major retail chain stores in the European food and non-food markets. ITAB is currently the largest supplier of checkouts in Europe and ranks as the second largest in entrance systems and shop fittings.
ITAB’s geographical market is concentrated to
the Nordic countries, the UK, Benelux, the Bal- tic countries, Central Europe including Poland, Germany, Hungary, Russia and the Ukraine.
ITAB is the market leader in the Nordic coun- tries, the UK, and the Baltic countries and one of the largest players in Central Europe and Benelux.
ITAB’s position and market expansion is based on being active near the customer, both geographically and through its concept and product portfolio. The goal is to create long-term customer relations, which is why ITAB’s market expands at the rate of its customers’ growth.
THE m ARKET
ANNUAL REPORT 2009 THE MARKET 23
“ITAB’s size enables us to shadow chain stores' expansion in new geographical markets. This fosters the prerequisites for product and concept development, and thereby, long-term customer relations.”
THE m ARKET
CLOSE CUSTOMER COLLABORATIONS Customers in the food segment comprise national and international grocery chains such as Ahold with ICA, Rimi, and Albert Hein, Dansk Super- marked with Netto and ASDA, Axfood, Coop, EDEKA, Kaufland, Kesko, Lidl, Metro Group, Morrisons, Real, Sainsbury, S-Gruppen, Tesco and Witrose Wilkinsons.
In the non-food segment, ITAB has a vast number of customers in ready-to-wear clothing, petrol, sports and home furnishing sectors.
Customers include Clas Ohlson, Cubus, Etos, Dunnes, Hema, Homebase, IKEA, John Lewis, Jysk, KappAhl, MQ, Statoil, Stockman, Oasis and A.S. Watson Group, as well as several players in the pharmacy market.
LONG-TERM CUSTOMER RELATIONS Customer needs in the European market for shop fittings and equipments differs between the different countries. Market demand for shop fittings, checkouts and entrance systems is driven by start-ups and refurbishment of shops in the food and non-food segments.
The entry barrier for being chosen as a sup- plier to these customers is high, demanding such requirements as market presence, production ca pacity and effectiveness. ITAB’s size enables us to shadow chain stores' expansion in new geographical markets. This fosters the prerequi- sites for product and concept development, and thereby, long-term customer relations.
Central production of standard fittings coupled with local, flexible production units further reinforces the service ITAB can offer.
MARKET TRENDS
Market trends often vary geographically so that ITAB’s establishment in each region gives the customer a sense of security and facilitates extended partnerships. During the past several years, a number of mergers between shops and chain stores have occurred, which leads to a greater need for refurbishment and re-profiling.
Fittings and shop concepts have a shorter life- cycle and change particularly often in the fashion segment. ITAB’s long-term customer relations make refurbishment and re-profiling critical components of the business.
Over the past years, the purchasing patterns of the retail chain stores has increasingly more come to involve concepts instead of individual products. Larger chains more often outsource concept development, project management and installation to one supplier.
COMPETITORS
ITAB competes through its broad concept and product portfolio with several companies in var- ious markets and in various product segments.
In Scandinavia and the Baltic region, competi- tors include Expedit, New Store Europe and Rol while the UK market includes such players as Eden and HMY/Radford as well as multiple smaller competitors.
In Benelux and Central Europe, several major
players share the market, including Hermes
Metal, van Keulen, Linde, Mago, Tego Metal,
Wanzl, Store Best and Umdasch.
ANNUAL REPORT 2009 24 ORGANISATION
