LammhuLts Office
LammhuLts möbeL ab Växjövägen 41 SE-360 30 Lammhult Sweden
Tel. +46 472 26 95 00 Fax +46 472 26 05 70 www.lammhults.se (formerly abstracta ab) Lammengatan 2 SE-360 30 Lammhult Sweden
Tel. +46 472 26 96 00 Fax +46 472 26 96 01 www.abstracta.se
LammhuLts Library
LammhuLts bibLiOteksdesign a/s (formerly BCI A/S)
Dalbaekvej 1 DK-6670 Holsted Denmark
Tel. +45 76 78 26 11 Fax +45 76 78 26 22 www.bci.dk
LammhuLts bibLiOteksdesign ab (formerly eurobib ab)
Åkergränden 7 SE-226 60 Lund Sweden
Tel. +46 46 31 18 00 Fax +46 46 32 05 29 www.eurobib.com
schuLz speyer bibLiOthekstechnik ag Friedrich Ebert Str. 2a
DE-673 46 Speyer Germany Tel. +49 6232 31810 Fax +49 6232 3181 700 www.schulzspeyer.de
institut für bibLiOthek design gmbh Germersheimer Str. 110
DE-673 54 Römerberg Germany
Tel. +49 6232 68670 Fax +49 6232 6867-68 www.bibliothek-design.de
LammhuLts hOme
LammhuLts hOme ab (formerly Voice ab) Betavägen 17 SE-556 52 Jönköping Sweden
Tel. +46 36 31 83 00 Fax +46 36 31 83 05 www.voice.eu ire möbeL ab Fabriksgatan 5 SE-543 50 Tibro Sweden
Tel. +46 504 191 00 Fax +46 504 156 75 www.iremobel.se
scandinaVian eyewear
scandinaVian eyewear Gräshagsgatan 11 SE-554 74 Jönköping Sweden
Tel. +46 36 30 53 00 Fax +46 36 30 53 20 www.scandinavianeyewear.se seVen s.r.L.
Via Cal Lusent 61 IT-31040 Pederobba (Tv) Italy
LammhuLts design grOup ab
Lammengatan 2. SE-360 30 Lammhult, Sweden Tel. +46 472 26 96 70. Fax +46 472 26 96 73 www.lammhults.com
2 Lammhults at a glance 4 CEO: On our way towards
the next level
10 This is Lammhults Design Group
10 Our operations 10 Our brand promise 11 Our organisation 11 Financial goals and
expectations for 2009 12 What makes Lammhults
Design Group unique?
24 Lammhults Office 28 Lammhults Library 32 Lammhults Home 36 Scandinavian Eyewear 40 Corporate governance
report 2008 44 Lammhults Design
Group’s share 47 Five-year overview 48 Board of directors 56 Senior executives
58 Director’s report 63 Consolidated income
statement, consolidated balance sheet, changes in consolidated shareholders equity and consolidated statement of cash flows 70 Supplementary information 95 Auditor’s report
ATLAS XL EASY CHAIR
dESIgnERS: JoHAnnES FoERSom And PETER HIoRT-LoREnzEn YEAR oF LAunCH: 2002
S70-3 STooL
dESIgnERS: BöRgE LIndAu And Bo LIndEkRAnTz YEAR oF LAunCH: 1968
LAMMHULTS DESIGN GROUP
net saLes ... SEK 901.2 million (829.2)
Operating prOfit ... SEK 85.5 million (73.3)
Operating margin ... 9.5 per cent (8.8)
cash fLOws frOm Operating actiVities ... SEK 93.3 million (50.2)
aVerage number Of empLOyees ... 400 (363)
2008 IN FIGURES
Our business concept
Lammhults Design Group’s business concept is to create positive experiences for a global clientele through modern interiors. Consumer insight, innovation, design management and strong brands are the cornerstones of our operations.
We develop products in partnership with several of Scandinavia’s leading designers.
Our businesses
Our businesses are gathered within four business areas. Lammhults Office de- velops and sells furniture and interiors for public environments such as offices and conference facilities. Lammhults Library is a world-leading business that develops and sells library interiors.
Lammhults Home develops and sells flat-pack and upholstered furniture for the home. The Group also includes Scandinavian Eyewear, which designs, develops and sells spectacle frames.
Our customers
We sell products to corporate custom- ers and private individuals. However, customers in the public sector account for the major share of our sales. Most of our sales go to export markets.
2008 in brief
new strategy: Lammhults Design Group adopted a new, brand-oriented strategy, with the focus on the Group’s strong- est brand, Lammhults.
strong results: The Group reported its highest-ever sales and operating profit, despite the fact that the climate in the market was affected by the financial crisis and the downturn in the economy.
stable finances: The Group’s financial position remained strong during the year, with an equity ratio of 50.0 percent and a debt ratio of 0.46 on 31 December. Cash flow from current operations rose to SEK 93.3 million.
important acquisitions: Three strategically important acquisitions were made during the year, namely the Swedish upholstered furniture maker Ire Möbel, the German library interiors company IFBD and Seven S.R.L, of Italy, a design company operating in the spectacles sector.
direct yield: The Board of Directors recommends, to the 2009 Annual General Meeting, a dividend of SEK 2.50 per share, representing a total dividend payment of SEK 21.1 mil- lion to shareholders. Direct yield thus amounts to 6.1 percent.
PRIvATE ConSumPTIon CoRPoRATE ConSumPTIon SwEdEn
EXPoRT mARkETS LAmmHuLTS oFFICE
LAmmHuLTS LIBRARY
breakdown on income by customer category
breakdown of income by geographical region business areas - percentage
shares of group’s operations
JOhan hJertOnssOn
president, LammhuLts design grOup
Johan is sitting in the imprint Chair Designers: peter hiort-Lorenzen anD Johannes Foersom
Year oF LaunCh: 2005 saLes 2008: seK 1.9 miLLion
In a few years’ time, when we look back at the 2008 financial year, my hope is that we at Lammhults Design Group will say the following: it was the year when we made the first serious steps towards Group-wide international expansion.
Because in 2008 we made a number of important decisions, all aimed at increas- ing our international presence. We intro- duced a new brand-oriented strategy and concentrated our efforts on the Lamm- hults brand – which also meant changing the name of the Group. We also made several organisational changes, and three corporate acquisitions of strategic im- portance. We managed to do all of these things – despite being in the midst of a financial crisis and economic downturn – without jeopardising the stability of our finances. Our net sales increased by 9%, our operating margin ended up at 9.5%, and we improved cash flow in our day-to- day operations from 50.2 to 93.3 million Swedish kronor. This is strong proof that we will continue to be able to cope with investments. In view of the extreme situ-
ation in the world around us, I have to say that we are extremely satisfied.
The decision to introduce the brand- oriented strategy was without a doubt the most important decision the com- pany has made since it was founded. It was not made because things were going badly for the Group. On the contrary, at that time we had just enjoyed two ex- tremely successful years, both in terms of finances and through our successful product portfolio containing a number of strong brands. In fact, the decision was made because the Group was ready to move on to the next stage of its develop- ment. By concentrating our businesses in just two areas, interiors and eyewear, we were able to leave behind the corporate structure we had had up to that point – similar to that of a holding company – and move towards running the business- es based on a Group-wide, brand-orient- ed strategy. Through clearer branding we significantly increase our chances of sustained, profitable growth, thereby increasing value for shareholders.
Our business concept is to create positive experiences for a global clien- tele through modern interiors. We have chosen our strongest brand – Lammhults – to be the hub of this work. For years Lammhults has represented values such as innovative design, functionality and sustainable quality. These are the values we will now be using to an even greater extent as tools for value creation. The key to a successful brand strategy lies in our ability to see into the lives of consumers.
Understanding what customers want and need today is not enough; we also need in- sight into what they will want tomorrow.
This demands a great deal of our innova- tive abilities – what will the products of tomorrow look like? What do we think our customers will be looking for the day after tomorrow? Innovative products with a high design value, in combination with an intensive pace of renewal in the product portfolio, will create high profit margins both now and in the future. The brand is our promise to our customers. The prod- ucts are proof that we keep our promises.
On Our way tOwards the next LeVeL
Our brand, our export potential, our independence from the business
cycle and our stable finances. These are the things I would like to
emphasise as Lammhults Design Group’s main strengths for the future.
t he new strategy entailed a number of major organisational changes. The first and most obvious was the change of name from Expanda to Lammhults Design Group, which took place at the beginning of July 2008. But we also made extensive chang- es internally and externally. Our subsidiaries are now grouped into four business areas, of which three are part of the Lammhults brand:
Lammhults Home, Lammhults Library and Lammhults Office. The fourth is Scandinavian Eyewear, which has its own brand platform with well-known brands such as Skaga, Efva Attling and Oscar Magnuson. Along with the President, the business area managers consti- tute the new Group management team.
We have designed the brand strategy so that we can work flexibly with several strong brands in our portfolio. The reorganisation gives us better opportunities to make the
most of synergies where sales, distribution, purchasing and administration are concerned.
These synergies are crucial to our attempts to increase our international presence. We need to become shrewder and more efficient, and to strengthen our position so we can adapt to the increasingly stiff competition and tougher market conditions. The interiors industry is in the process of structural transformation.
Globalisation does not just mean changes in distribution conditions. Customer prefer- ences also change. We concluded early on that consumer purchasing behaviour and demand are being concentrated to an ever-increasing extent in either the upper or lower price seg- ment, and we have positioned ourselves in the upper segment in response to this behaviour.
At the same time, globalisation is playing into our hands. For example, it is enabling us to cut our production costs by buying in com- ponents from low-cost countries to a greater degree. The fact that we are well on the way to lowering these costs can be seen in our gross margin, which increased from 39.8% to 40.9% in 2008.
Globalisation is also helping us in our ef- forts to achieve growth, as it makes it easier to reach the global market. The new organisa- tion will also improve our chances of entering new export markets. Our subsidiaries can help each other in several ways, for example by setting up joint sales channels.
Acquisitions continue to play an impor- tant part in our growth strategy. Our stable finances give us plenty of room for manoeuvre – on 31 December the equity ratio was 50%.
In 2008 we made three important acquisi- tions that strengthened us strategically in
saLes 2006–2008operating proFit, 2006–2008
2006
815.9
2006
84.8
2007
829.2
2007
73.3
2008
901.2
2008
85.5
different ways. The library business acquired Institut für Bibliotheks-Design GmbH, a Ger- man library interiors company with sales of around 15 million Swedish kronor. The library business is important for us, not only due to its success and size in the Group – 39% of our net sales comes from libraries – but also in its capacity as a business cycle stabiliser. Librar- ies are usually financed from public funds, and these types of investments follow cycles that are entirely separate from the general business cycle. Lammhults Design Group is currently the world leader in interiors for libraries and other modern venues such as cultural centres, winning projects in coun- tries as diverse as the US and the United Arab Emirates.
By purchasing a former partner, the Italian eyewear manufacturer Seven S.R.L., which has sales of around 30 million Swedish kronor, Scandinavian Eyewear also made an acquisition that strengthened the company’s international profile.
The third acquisition was made by Voice, which acquired another well-known furni- ture manufacturer with roots in Småland, southern Sweden: Ire Möbel AB, with sales of around 50 million Swedish kronor. This acquisition complements what we can already offer consumers, as Ire Möbel specialises in well-made upholstered furniture with a high level of design.
During the fourth quarter, as part of our efforts to sharpen our focus, we also made the decision to merge our subsidiaries Lammhults Möbel, which develops and sells furniture for public and private environments, and Ab- stracta, which designs and sells room dividers
and visual aids. Our interiors offering is now under the auspices of one company, Lam- mhults Möbel AB, improving our chances of providing better service and selling additional products to our customers, among which architects are a key target group.
Proof that Lammhults Möbel AB is also in the process of reinforcing its position on the international interiors scene came at the start of 2009. That was when the company received its biggest order to date, when the five-star Point Hotell Barbados in Istanbul, Turkey, ordered designer furniture amounting to the equivalent of ten million Swedish kronor.
L ooking back, I can confirm that we have clearly benefited from our relative lack of sensitivity to the business cycle during the last period. Those businesses most af- fected were those that most clearly target pri- vate customers – furniture for the home and spectacle frames. However, these branches make up less than 25% of sales. The library section and Lammhults Möbel, which togeth- er represent the lion’s share of our net sales, specifically target B2B. Aimed at offices and public environments, they are therefore even further ahead in the business cycle. Above all, the proceeds from publicly financed projects, which make up half of our net sales, limit our business cycle dependence.
The key to success in the future is to main- tain our high level of innovation in product development. Our ambition is to continue to focus strongly on customers – to really get un- der their skin and develop the products that they are not even aware that they want.
None of this is possible without our crea-
tive designers and other innovative employ- ees. We will continue to use our successful model with both our own designers and in collaboration with independent designers. I am completely convinced that future product development will be made easier and im- proved through our focus on the brand. I am also completely convinced that, in turn, con- scious branding is the key to growth and value for shareholders. Lammhults Design Group is rapidly heading towards a very positive and expansive period.
johan hjertonsson president and ceo
gross margin, 2006–2008, per CentequitY ratio, 2006–2008, per Cent
2006
40.8
2006
51.9
2007
39.8
2007
52.1
2008
40.9
2008
50.0
a-Line moDuLar seating Designer: anYa sebton Year oF LaunCh: 2004 saLes 2008: seK 2.6 miLLion
Our operations
It’s true that we at Lammhults Design Group work with design and interiors.
But you could just as easily say that we work with communication. Whether in an office, a library or the home, an interior needs to maximise the power of spontaneous encounters. Our products help create spaces where people can meet and communicate more efficiently.
We have extensive experience of what is required to develop successful products for interiors, and our work cen- tres around the needs of our customers.
Corporate law firms, doctor’s surgeries, designer hotels, libraries, airports and private individuals all want to put across their own particular message through their interiors. But these environments need to simultaneously be functional, creative and practical. A writing board cannot be made less functional just because it needs to be a more exclusive model. A room divider should be able to both highlight a space and screen one off.
And it should always be both innova-
tive and beautiful. For this reason, we only work with Scandinavia’s foremost designers. We also have a strong tradi- tion of technical innovation. Lammhults was founded in 1945 by Edvin Ståhl un- der the name of Lammhults Mekaniska AB and began by manufacturing metal details for the furniture industry. In the 1960s the designers Börge Lindau and Bo Lindekrantz entered the frame, and along with Edvin Ståhl they produced furniture for public environments that is still relevant today. The breakthrough came in 1968 with the Bauhaus-inspired S70 series, with its heavy, characteristi- cally painted steel tubing. The world- famous bar stool with a tractor seat is still in production.
We work actively to encourage good design. In 2008 we announced the first round of the Lammhults Design Award, which aims to pave the way for young designers in Lammhults Design Group.
We received a whole host of top-quality proposals for products in Lammhults’
business areas. The ‘Black Hole’ arm-
chair by Mathieu Gustafsson and Pär Rickberg was declared the winner.
Our brand promise
Lammhults Design Group targets conscious cosmopolitans who appreci- ate expressive design and innovative functionality. We will offer them sus- tainable interiors that strengthen their identity and make them feel secure, proud and special.
this is LammhuLts design grOup
LAMMHULTS DESIGN GROUP
LAMMHULTS OFFICE
SUBSIDIARIES
� Lammhults Biblioteksdesign AB (formerly Eurobib AB)
� Lammhults Biblioteksdesign A/S (formerly BCI A/S)
� Schulz Speyer Bibliothekstechnik AG
BRANDS
� Eurobib Direct
� BCI
� Schulz Speyer
SUBSIDIARIES
� Lammhults Home AB (formerly Voice AB)
� Ire Möbel AB
BRANDS
� Voice
� Ire
SUBSIDIARIES
� Scandinavian Eyewear AB
� Seven S.R.L.
BRANDS
� Skaga
� Efva Attling
� Oscar Magnuson SUBSIDIARY
� Lammhults Möbel AB
BRANDS
� Lammhults
� Abstracta
LAMMHULTS LIBRARY LAMMHULTS HOME SCANDINAVIAN EYEWEAR
Our financial goals and expectations for 2009
The financial goals of Lammhults De- sign Group over the course of a business cycle are:
• Average annual growth of at least 15%
• An average annual operating margin of at least 10%
• Return of at least 20% on capital employed
• An equity ratio of at least 35%
• A debt ratio of between 0.7 and 1.0
• Dividend payout ratio of approxi- mately 40% of earnings after tax, taking into account the Group’s long- term capital requirements.
In view of the financial crisis and the eco- nomic downturn, we lowered our expec- tations for growth in sales and margins to some degree during the year. The slump makes it difficult to predict the market situation over the coming year, but we
are still confident about the future. We have internationally competitive products and prices, and our focus on a brand-ori- ented strategy will in the long term help
create synergies in marketing, sales and branding. This will mean in turn that we can continue to expand internationally in 2009. 1. Varumärkesorienteringen
Gr o up 2004 2005 2006 2007 2008
net sales, SEk m 613.1 642.5 815.9 829.2 901.2
operating profit, SEk m 36.3 34.2 84.8 73.3 85.5
operating margin, % 5.9 5.3 10.4 8.8 9.5
Capital employed, SEk m 453.7 445.2 462.6 483.0 577.9 Return on capital employed, % 8.1 7.9 19.0 15.0 16.6 Return on shareholders’ equity, % 8.4 7.4 17.9 12.6 14.2
Equity ratio, % 46.4 49.5 51.9 52.1 50.0
debt ratio, multiple 0.72 0.59 0.43 0.40 0.46
Investments, SEk m 12.0 16.1 17.3 12.5 27.6
The group applies IFRS as of 2005. Comparative figures for 2004 have been restated in accordance with IFRS.
five-year summary
Our organisation
Financial goals and expectations
1. brand focus
Concentrating our efforts on our strongest brand
In 2008 we began to concentrate our efforts on our strongest brand: Lamm- hults. A brand-oriented approach gives us more opportunities to exploit syner- gies in production, product development and marketing. The brand strategy is also largely customer-centred. Insight into what the consumer wants and will
need in the future is crucial if we are to be successful in our business. Our goal is to always get under the skin of our customers and develop the products they were not even aware they wanted.
We constantly strive to achieve our five core values: to be unique, self-assured, receptive, innovative and thorough.
We have a collection-inspired ap- proach to brands, which is why our other highly valued and well-estab- lished brands, such as Voice, Abstracta
and Ire, are still available. By using our entire brand collection, we can be more flexible about meeting the customer’s individual needs for interiors solutions, always with the Lammhults brand as a natural focal point. In the long run our strategy will lead to more distinct branding, greater customer focus and greater synergies. This in turn will cre- ate sustainable, profitable growth that increases shareholder value.
what makes LammhuLts design grOup unique?
Our brand focus, our export potential, our relative independence from the business cycle and our stable finances. these are our four strategic advantages that can create value for the future.
we will explain these further in the following pages.
PRoduCT: CAmPuS CHAIR
dESIgnER: PETER HIoRT-LoREnzEn And JoHAnnES FoERSom YEAR oF LAunCH: 1992
SALES 2008: SEk 38.6 mILLIon FoR THE CAmPuS SERIES, oF wHICH 21.3 mILLIon FoR THE CHAIR
ABouT THE PRoduCT: wITH ITS SLEndER LInES And STRong dESIgn IdIom, THE CAmPuS CHAIR HAS BEComE onE oF LAmmHuLTS’ BEST SELL- ERS ovER THE YEARS, BoTH AS A dESIgnER ITEm And AS A FunCTIonAL PIECE oF FuRnITuRE FoR vARIouS EnvIRonmEnTS. THE CHAIRS ARE ALSo AvAILABLE wITH ARmRESTS And ACCESSoRIES SuCH AS A LAPToP TABLE. THEY ARE EASY To movE, LInk TogETHER And STACk.
PRoduCT: AIRFLAkE
dESIgnER: STEFAn BoRSELIuS YEAR oF LAunCH: 2007 SALES 2008: SEk 2.9 mILLIon
ABouT THE PRoduCT: STEFAn BoRSELIuS’ Sound-ABSoRBEnT Room dIvIdER In FABRIC-CovEREd FIBRE FELT TAkES SnowFLAkES AS ITS InSPIRATIon And CAn BE vARIEd Ad InFInITum. IT CAn BE Hung STRAIgHT oR CuRvEd, And THE moduLES CAn BE ComBInEd In FouR dIFFEREnT modELS And FIvE dIFFEREnT CoLouRS. THERE IS ALSo A moduLE FoR SToRIng nEwSPAPERS.
PRoduCT: SAHARA dESIgnER: gunILLA ALLARd YEAR oF LAunCH: 2007 SALES 2008: SEk 3.8 mILLIon
ABouT THE PRoduCT: SAHARA, wHICH TAkES ITS InSPIRATIon FRom LodgE LIFE In AFRICA, BECAmE An ImmEdIATE SALES SuCCESS And IS ALSo AvAILABLE AS A SoFA. In 2008 IT wAS JoInEd BY A vERSIon wITH LEgS In wood InSTEAd oF STEEL, PLuS An ACComPAnYIng woodEn CoFFEE TABLE.
PRoduCT: ImPRInT CHAIR.
dESIgnER: PETER HIoRT-LoREnzEn And JoHAnnES FoERSom YEAR oF LAunCH: 2005
SALES 2008: SEk 1.9 mILLIon
ABouT THE PRoduCT: ImPRInT IS THE RESuLT oF SEvERAL YEARS’ RESEARCH. THAnkS To ITS EnvIRonmEnTALLY FRIEndLY mATERIALS, ITS LAunCH ATTRACTEd A gREAT dEAL oF ATTEnTIon, And IT won THE BEST oF nEoCon InnovATIon AwARd In CHICAgo THE SAmE YEAR. THE SEAT IS mAdE FRom BY-PRoduCTS oF THE FoRESTRY InduSTRY THAT ARE ComPRESSEd TogETHER, uSIng SHREddEd PET BoTTLES AS A BIndER. THE mATERIAL CAn BE FoRmEd In AS mAnY dIFFEREnT wAYS AS PLASTIC.
PRoduCT: ARCTIC dESIgnER: RoLF FRAnSSon YEAR oF LAunCH: 2005 SALES 2008: SEk 37.1 mILLIon ABouT THE PRoduCT: THE SHInY ARCTIC SToRAgE SERIES oFFERS So mAnY ComBInATIon PoSSIBILITIES THAT THE onLY LImIT IS YouR ImAgInATIon. THIS modERn PIECE oF FuRnITuRE CAn STAnd on THE FLooR oR BE Hung on THE wALL And IS AvAILABLE In vERSIonS RAngIng FRom SHoE SToRAgE To SIdEBoARdS. THE woRkToP In SEvEn dIFFEREnT mATERIALS ALLowS CuSTomERS To EXPRESS THEmSELvES In THEIR own unIquE wAY.
2. exports
The world is our market
We are already an international company – the largest part of our revenue comes from ex- port markets. Our products are available from San Francisco in the west to Japan in the east.
We also consider that our biggest chances of growth are in international markets. We believe we will continue to enjoy good op- portunities for expansion in these markets, either by increasing our market share in existing markets or by establishing ourselves on new ones. This can take place organically or through acquisitions of businesses within existing businesses or associated ones. We will also benefit from synergies when we are able to coordinate sales and marketing efforts internationally. The chart shows all the mar- kets in which we currently have a presence.
where our revenues come from
SwEdEn
EXPoRT mARkETS
The diagram shows the distribution of Lamm-
hults Design Group’s net sales between Sweden
and the export markets.
san FranCisCo internationaL airport, usa proDuCt: miLibar stooL
Designer: anYa sebton Year oF LaunCh: 1999 saLes 2008: seK 3.4 miLLion
3. independence from the business cycle We follow our own business cycle logic Naturally, we are also affected by general fluc- tuations in the business cycle. But we haven’t put all our eggs in one basket. The businesses in Lammhults Home and Scandinavian Eyewear are located early on in the business cycle, with their great exposure to private consumption. Lammhults Office, on the other hand, whose customers are mainly compa- nies and public institutions, is found later in the cycle. And Lammhults Library follows a business cycle that is entirely its own, since its projects are often financed by public funds.
Libraries and education are areas that central government and municipalities often choose to invest in during economic downturns. And this works in our favour.
As we said, we ’re by no means immune.
But we have a good spread of businesses. This mitigates the total effect of business cycle fluctuations.
distribution of revenues
The diagram shows the distribution between Lammhults Design Group’s various customer segments. This diversification mitigates the effects of business cycle fluctuations.
PRIvATE ConSumPTIon
CoRPoRATE ConSumPTIon
PuBLIC ConSumPTIon
proJeCt: rauFoss pubLiC LibrarY, norwaY CompLeteD in: 2008
proDuCts: Luna sounDprooF armChair anD im- pex sheLF sYstem
4. finances
We can afford to grow
Having strong finances is an important part of our strategy. On the one hand, when the business cycle turns, like in 2008, the chance of organic growth becomes more remote. But on the other, there are golden opportunities for acquisitions. When those occasions arise, we need to be ready.
Up to now we have maintained our level of ambition. In 2008 we acquired three com- panies without jeopardising our financial stability for a second. We increased our cash flow from day-to-day operations to just over 93 million Swedish kronor. Our equity ratio at the turn of the year was strong, at 50%, which is way over our financial goal of 35%. The debt ratio is extremely low, at 0.46%, compared
with the financial goal of 0.7–1.0%. Based on our financial strength, we therefore made fur- ther two acquisitions in our library business at the start of 2009.
There are several factors behind our strong finances. High demand for our products naturally forms the basis of this.
But we are also good at constantly stream- lining our operations and identifying Group-wide synergies. Buying in compo- nents from low-cost countries to a greater extent is a prioritised area of our strategy and something we put a lot of effort into.
This work is important, as it will enable us to maintain our profitability, even in times of greater hardship. If subcontractors are given responsibility for a major part of the processing, our own flexibility in periods of low demand will increase.
“To achieve record results in the midst of a financial crisis and economic slump – this is proof of the
attractive product offerings and financial strength we
have in Lammhults Design Group.”
thOmas JanssOn
cfO LammhuLts design grOup thomas is sitting in the Cinema sport armChair
Designer: guniLLa aLLarD Year oF LaunCh: 1999 saLes 2008: seK 1.2 miLLion
pLaCe: Kobe, Japan
proDuCt: Cinema easY Chair Designer: guniLLa aLLarD Year oF LaunCh: 1994 saLes 2008: seK 7.3 miLLion
LammhuLts Office
Bus i nes s ar ea mana Ger :
ÅkE JAnSSon
Compan i es i n t he Bus i nes s a r ea:LAmmHuLTS möBEL AB
Br ands i n Cl uded i n t he Bus i nes s a r ea:
LAmmHuLTS, ABSTRACTA.
net s al es 2 008:
SEk 353.5 mILLIon
oper at i n G mar Gi n i n 2 008:13.2%
pr op or t i on ex por t ed:
40%
business and brands
Lammhults Möbel AB develops and markets interiors for public environments, where the demands in design, functionality and quality are high. The business area is made up of two brands: Lammhults, with its timelessly attrac- tive furniture, and Abstracta, with flexible room dividers and products for visual com- munication, such as writing boards. The prod- ucts are developed via long-term partnerships with Scandinavia’s foremost designers. A large number of products have been awarded design prizes, not only in Scandinavia but also in other parts of the world. Lammhults’
end-users are primarily companies, other organisations and public institutions. As a result, architects who design and recom- mend interiors are an important target group.
Lammhults’ products are sold via agents and resellers in the individual markets.
market
The company’s position in the Scandinavian market is strong. Lammhults Möbel has long been established as one of the major players above all in the domestic market, Sweden. Ex- ports account for around 40% of sales, which is where the major potential for growth lies.
Today, Norway, Denmark, the UK, Germany, the US and the Netherlands are the company’s biggest export markets. As to the future, France, Germany and the Netherlands are especially attractive growth regions strate- gically, offering the business area consider- able potential for growth of market shares.
However, competition in the sector is tough, above all from German, Danish and Italian companies.
market drivers
Moves, conversions or new-builds – these are the major drivers of demand from customers when it comes to interiors for public envi- ronments. These drivers create a pattern of behaviour that can cause major fluctuations in demand over a business cycle. By selling in a large number of markets, and to both corpo- rate and public-sector customers, the business area can even out these fluctuations and soften the effects of the business cycle. For example, the biggest investments of corporate customers very often materialise at the end of the business cycle, when a strong demand for expansion has developed. For its part, public- sector activity, for example at universities and airports, very often looks to parameters other than the current state of the economy when investments are to be made. Relocations also continue, even when times are hard.
Another influence on demand is general trends in interiors. The way people confer and meet professionally has changed radically over the past two decades. Formal meetings have been replaced by collaboration, which is making totally new demands on developing creative environments. The need for screen- ing products and movable visual aids has also expanded as more and more customers are choosing open-plan office environments.
Finally, demand is also driven by good design.
Strong, innovative design is always at a premium.
Lammhults operates in long-term partnership with a number of selected, eminent designers:
Gunilla Allard, Peter Hiort-Lorenzen, Johan- nes Foersom, Ruud Ekstrand, Love Arbén, Anya Sebton, Stefan Borselius, Mia Wahlstein, Josef Zetterman, Fredrik Wallner and Nina Jobs.
There is an intrinsic
value in having an extensive offering, especially now that the distribution sector is consolidating. When we develop products, we study needs seg- mentation. How do people behave in different environments, and how do our products best support this behaviour?
Once we have completed this analysis, it becomes easier to develop products and to position ourselves at the right level relative to customers. A lawyers’
office full of corporate lawyers will, after all, want to communicate one message through their interior, while lawyers specialising in international law will need to communicate a quite different message - but both will need a fit-for-purpose and functional interior.
Åke JanssOn
business area manager LammhuLts Office
significant events in 2008
• Sales by the business area rose by SEK 40.1 million to SEK 353.5 million. An operating margin of 13.2% was reported.
• In the fourth quarter, a decision was taken to merge Lammhults Möbel AB and Abstracta AB. The merger took effect at year-end. The purpose is to boost focus on the customer, to raise the level of cost-ef- ficiency and to make it possible to coordi- nate and step up efforts in product develop- ment, marketing and brand building.
• In the course of the year, a number of new products were launched: the Funk range of tables and the Club armchair by Johannes Foersom and Peter Hiort-Lorenzen, who also launched a new version – Air – of their renowned, top-selling Campus chair. A bar stool, Mini, was added to the Millibar range
from Anya Sebton. Gunilla Allard’s Casino easy chair was launched in a new, fully cov- ered version, and a high table for standing meetings was added to her Cooper series of tables. Other products developed in 2008 and shown at the Stockholm Furniture Fair in 2009 included Anya Sebton’s product Area, a modular seating featuring an inno- vative magnetic linking device, and Gunilla Allard’s Sahara Wood, an update of her much-admired Sahara easy chair, with legs in wood instead of steel. At Abstracta, Anya Sebton presented a new screen, Triline, Stefan Borselius added new products to his Sense range and Mia Wahlstein and Josef Zetterman brought out an improved version of Enjoy. Nina Jobs presented a new table screen and a number of new patterns in the Alumi range.
l a mmh u l t s mö Bel a B 2004 2005 2006 2007 2008
net sales, SEk m. 136.7 143.2 178.2 178.3 196.9
operating profit, SEk m.* 16.0 13.4 27.0 23.3 30.6
operating margin, % 11.7 9.4 15.1 13.1 15.5
Capital employed, SEk m. 59.3 58.0 64.8 61.4 69.2
Return on capital employed, % 27.1 23.2 44.3 37.3 47.4
Investments, SEk m. 1.8 1.2 2.0 2.6 1.3
Average number of employees 78 76 79 77 78
aBs tr aCta a B (merged with Lammhults möbel, effective 2009) 2004 2005 2006 2007 2008
net sales, SEk m. 86.3 92.0 112.8 135.1 156.6
operating profit, SEk m.* 0.9 4.4 9.3 11.0 16.2
operating margin, % 1.1 4.8 8.2 8.2 10.3
Capital employed, SEk m. 71.3 69.5 68.1 75.3 78.5
Return on capital employed, % 1.4 6.4 13.9 16.3 21.8
Investments, SEk m. 1.7 2.2 3.4 3.1 3.8
Average number of employees 71 61 66 65 76
* excluding administration fees to the Parent Company.
proJeCt: hJörring pubLiC LibrarY, DenmarK CompLeteD in: 2008
proDuCt: CLassiC steeL sheLF sYstem
LammhuLts Library
Bus i nes s ar ea mana Ger :
Thomas Johannesson
Compan i es i n t he Bus i nes s a r ea:Eurobib AB, Schulz Speyer Bibliothekstechik Ag and BCI AS with subsidiaries.
Br ands i n Cl uded i n t he Bus i nes s a r ea:
Eurobib direct, Schulz Speyer, BCI
net s al es 2 008:SEk 353.4 million
oper at i n G mar Gi n :12.3%
pr op or t i on ex por t ed:
80% (Sweden and
denmark 20%)
business and brands
The Lammhults Library business area con- tinuously develops new creative, attractive and functional interiors for libraries, schools and other public meeting places. We are world leaders in library interiors. We also sell interi- ors for other environments in which informa- tion materials and media are to be stored or displayed, for example educational premises and arts centres.
The library business is divided into two parts: project sales of complete interiors systems and furniture, and aftermarket sales through catalogues and online stores, with sales of furniture and consumables.
The business area encompasses three large companies: Swedish Eurobib AB, Ger- man Schulz Speyer Bibliothekstechnik AG and Danish BCI AS. Sales and marketing are handled by a joint network of subsidiaries in Belgium, the UK, France, Spain and Norway.
The Norwegian company is 50% owned by Eurobib AB. In other markets around the world, sales are made through local dealers.
Eurobib and BCI have a joint organisa- tion, with a headquarters for project sales in Holsted, Denmark, and the headquarters for aftermarket sales in Lund. Schulz Speyer has an independent organisation but works closely with its fellow subsidiaries where for example purchasing is concerned.
Eurobib, Schulz Speyer and BCI are the dominant brands in their market niches.
Along with the Lammhults Group’s other brands, this allows us to offer our customers a unique range.
Production takes place at BCI’s own facilities in Denmark and at subcontractors’ facilities.
market
The library interiors sector is a niche market in which growth most often takes place by increasing market shares and expanding into new markets. Lammhults Library is the only actor operating globally. It is therefore extremely important from the strategic point of view for Lammhults Library to continue to expand internationally. In theory, all coun- tries in which there are resources to invest in education are conceivable growth areas.
Lammhults Library’s companies are currently market leaders in the Nordic region and in Western Europe, and they are well estab- lished in the rest of Europe, Asia and North America. The business area is also represent- ed to a lesser extent through dealers in North Africa and Australia. Out of the existing mar- kets, North America continues to be of great interest as a growth area, along with markets in the Middle and Far East. Sales outside the domestic markets of Denmark and Sweden make up around 80% of the business area’s net sales. The overall trend is that competi- tion is shifting from market to market, with one to two large local actors plus a number of smaller local actors.
market drivers
The sector is not directly affected by general fluctuations in the business cycle – instead, it follows its own cycle, as investments in librar- ies are often financed using public funds.
Customers are then dependent on the public economy and the willingness of public au- thorities to invest, and require a long planning horizon before the project is completed.
A strong market trend is for libraries to
We develop products
to a large extent during projects.
Often, we receive a request and find a solution that turns out so well that we’re able to standardise the product.
One such example is our round metal shelf. As far as we know we’re the only company currently capable of manufacturing such shelves.
thOmas JOhannessOn
business area manager LammhuLts Library
become increasingly centralised – and big- ger. You could say that they are becoming landmarks – buildings assigned particular importance in a community. They are no longer simply places for books and studies – to an increasing extent they are also turning into meeting places and experience hubs. This trend has made customers more inclined to invest in library projects. At the same time their planning has become more meticulous and thorough, as design and architecture are becoming increasingly crucial to the success of the project.
A further international driver for the library market is that increasing numbers of countries are realising the importance of investing in education and educational premises.
Maintaining a high level of design is impor- tant. The Companies therefore work with well-
known designers such as Björn Dahlström, Louise Hederström, Bernt and Mårten Cyrén.
significant events in 2008
• Sales increased sharply in 2008, above all in Denmark, Germany and the Middle East.
• Several large, prestigious projects were carried out, including the city library in Strasbourg and library interiors for 140 schools in Kuwait.
• BCI purchased German library interiors company Institut für Bibliotheks-Design GmbH
• Started own sales company in the UK, Thedesignconcept Ltd
• Work to amalgamate the organisations of Eurobibs and BCI continued success- fully, with several savings resulting from streamlining efforts.
l a mmh u l t s l i Br a ry 2004 2005 2006 2007 2008
net sales, SEk m 222.7 241.5 339.3 315.5 353.4
operating profit, SEk m * 14.3 18.2 35.8 32.6 43.6
operating margin, % 6.4 7.5 10.6 10.3 12.3
Capital employed, SEk m 109.8 110.7 136.1 141.7 189.0
Return on capital employed, % 14.1 17.1 29.7 24.7 27.7
Investments, SEk m 3.6 6.2 7.5 3.4 5.0
Average number of employees 134 127 150 140 150
* excluding administration fees to the Parent Company.
soFa: ChiLL, ire
Designer: CarL henriK spaK Year oF LaunCh: 2009 storage: arCtiC, VoiCe Designer: roLF Fransson Year oF LaunCh: 2005
LammhuLts hOme
Bus i nes s ar ea mana Ger :
Sonnie Byrling
Compan i es i n t he Bus i nes s a r ea:Lammhults Home AB (formerly voice AB) with subsidiary Ire möbel AB.
Br ands i n Cl uded i n t he Bus i nes s a r ea:
voice, Ire
net s al es 2 008:
SEk 86.8 million
oper at i n G mar Gi n :3.1%
pr op or t i on ex por t ed:
45%
business and brands
Lammhults Home business area develops and markets products for home interiors. The target group is made up of private consumers and customers looking for interiors for public areas where it is important to create a cosy, homely atmosphere, e.g. hotels and relaxed conference settings.
The brands Voice and Ire make up one of the market’s strongest product ranges, offer- ing complete solutions including upholstered furniture and tables, chairs and storage products. The product base of the Voice brand comprises storage furniture, such as chests of drawers and sideboards, and also tables and chairs. Production is extremely flexible, as it is based on a component concept in which com- ponents are purchased from various subcon- tractors for assembly and packaging at Lamm- hults’ own facility. This means that Voice products can be developed with a large degree of flexibility and adaptation to the market.
The Ire brand is known for its well- designed upholstered furniture, including sofas and armchairs. Its design philosophy is one of durability and quality. The furni- ture is flexible and functional and can be adapted by using different covers that can be removed and washed. Production takes place with the help of both modern compu- ter technology, which ensures, for example, the highest level of precision when cutting cloth, and classic craftsmanship in the as- sembly phase.
market
Around half of Lammhults Home’s custom- ers are located in Sweden, with the rest
in international markets. If we look at the Scandinavian market, Lammhults Home occupies a strong position. Our Nordic neighbours – Norway, Denmark and Finland – account for around 25% of sales. Remain- ing exports go to countries such as the UK, Portugal, Germany and Japan. Custom- ers on the Nordic markets are generally independent, while in the rest of Europe and in Japan they are normally major actors.
The Voice brand has no direct competitors in the Swedish market, as Voice is the only company that can adapt its offering to cus- tomer demands while maintaining relatively short lead times. There is, however, some competition from actors that directly import similar products.
market drivers
As Lammhults Home is greatly exposed to the consumer market, the business area is located early on in the business cycle. It also saw a decline in demand in 2008 as the economic slump worsened. It is worth remembering, however, that using the same logic, upswings also take place earlier. There is also space in the market, even in times of economic downturn. People in a modern society need storage furniture and sofas regardless of the general economic situation.
Opportunities for growth may also be posi- tively affected, as company prices often go down, which benefits actors like Lammhults Design Group who have the financial muscle to be able to make acquisitions.
Growing public interest in high quality de- sign also benefits market growth. We occupy a strong position in the premium products
We’re in a strong
position among our customers. One explanation for this is that we’ve managed to be innovative in product development – we’ve identified the interiors requirements of consumers.
We work constantly to offer attractive interiors solutions to our target group, based on a holistic view of the home.
We currently excel in storage solutions and upholstered furniture, but there’s nothing to stop us looking at new areas.
sOnnie byrLing
business area manager LammhuLts hOme
target group and have several sales successes behind us, e.g. the Arctic series of storage furniture. Ire is also a well-established brand among consumers. The new brand strategy also allows us to sell products from Lamm- hults Office to private individuals interested in design.
Where interiors for public environments such as hotels are concerned, our product innovation abilities and consumer insight work to our advantage. For example, we can adapt our storage furniture so that it also functions in public environments, supple- menting our offering with additional Lamm- hults products. New trends in the workplace also drive our market. Creative meeting places require different types of office environments, and soft sofas and armchairs are becoming increasingly commonplace in these settings.
significant events in 2008
• Lammhults Home AB acquired Ire Möbel AB in August 2008. Synergy gains in sales have already emerged in the form of increased revenue.
• The business area was successful in the hotel customer group, including a sub- stantial order from Stay At, a hotel chain specialising in cosy hotel environments for stays longer than a week.
• Out of the export markets, Germany developed in a particularly positive direc- tion, with Lammhults Home increasing its market share.
• The launch of Alento, a new storage series, was initiated in 2008.
• Several product development projects with new designers were initiated in 2008. The results of these projects will be launched during 2009.
l a mmh u l t s h o me 2004 2005 2006 2007 2008
net sales, SEk m 55.1 54.9 60.5 82.7 86.8
operating profit. SEk m * 5.3 6.2 4.9 8.1 2.7
operating margin. % 9.6 11.3 8.1 9.8 3.1
Capital employed. SEk m 39.5 40.9 38.6 36.2 57.5
Return on capital employed. % 13.4 15.6 12.5 22.0 6.1
Investments. SEk m 1.0 0.6 1.8 1.1 15.6
Average number of employees 24 25 28 33 44
* excluding administration fees to the Parent Company.
scandinaVian eyewear
Bus i nes s ar ea mana Ger :
Joakim Brobäck
Compan i es i n t he Bus i nes s a r ea:Scandinavian Eyewear AB with subsidiary Seven
Br ands i n Cl uded i n t he Bus i nes s a r ea:
Skaga, Efva Attling, oscar magnuson
net s al es 2 008:SEk 113.1 million
oper at i n G mar Gi n:3.9%
pr op or t i on ex por t ed:
53%
business and brands
The Scandinavian Eyewear business area develops and sells high-quality spectacle frames with a high design value and a clear Scandinavian feel. The company has its own well-known Skaga brand and develops col- lections within the Efva Attling and Oscar Magnuson brands. The brands differ in char- acter but the sense of design, attention to detail and excellent fit are common to them all. End customers are people who wish to express their lifestyle and identity through their eyewear. The business area’s direct customers are individual opticians and optician chains in Sweden and in the export markets. Design, prototype production and testing take place in Sweden, while manu- facture is localised in Italy and China. New collections are presented four times a year.
Thanks to a modern facility in Jönköping for warehousing and distributing spectacle frames, the company is able to provide ef- ficient distribution services and a high level of reliability in deliveries.
market
The European eyewear markets are roughly similar in structure. There are often a number of strong local chains of opticians, plus a large number of independent opticians in purchasing cooperatives. In turn, these are served by a number of subcontractors, including Scandinavian Eyewear. In Sweden Scandinavian Eyewear is the biggest of the Swedish subcontractors and one of the big- gest suppliers of optical frames to Swedish opticians. Its position in the rest of the Nordic region is also strong. In total Scandinavian
Eyewear exports spectacle frames to 22 dif- ferent countries.
Competition in sales to retailers can be divided into two groups: there are spectacle manufacturers that solely focus on own- brand eyewear, such as the French company Mikli and the Danish companies Lindberg and ProDesign, and there are also a number of international fashion houses that use their brand to market spectacles through brand extension. This eyewear is manufactured and sold via brand licences throughout the world by a number of actors, the biggest being Lux- ottica, Safilo, Marcolin and Marchon.
market drivers
There are two factors behind the decision of an individual to buy new spectacles: the need for vision correction and the need to express his or her style. With its significant exposure to private consumption, the business area is located early on in the business cycle. There are, however, factors that indicate that the Nordic and international markets will contin- ue to be substantial. An increasing proportion of the population requires vision correction, and studies show that sales of contact lenses are not growing at the expense of the specta- cle market. Fashion trends also have a major impact on the market, and many people today consider spectacles to be a very personal day- to-day accessory strongly linked to current trends. This can above all be seen in the fact that people change spectacles increasingly of- ten. From having changed every seven years, the average Swedish user buys new spectacles every 3½ years. In Europe and the UK, the equivalent frequency is every other year.
In many ways
we function in the same way as any other fashion company: we come out with four collections a year and face the same challenges as fashion compa- nies where identifying the right designs are concerned. An important key to success is therefore to constantly main- tain a strong focus on development and design. We also have an enormous competitive advantage in that we excel in delivery reliability. We’re often able to deliver an order in one or two days, which is very important for both the optician and the end customer.
JOakim brObäck
business area manager scandianaVian eyewear
significant events in 2008:
• Scandinavian Eyewear signed an agree- ment with Pearle Europe, Europe’s biggest chain of opticians. The agree- ment means that Scandinavian Eyewear was once again entrusted by Synoptik, a wholly owned subsidiary of Pearle Europe, with supplying spectacle frames to the chain’s stores in Sweden and Denmark. The agreement also means that Scandinavian Eyewear has the opportu- nity to supply products to the Pearle chain throughout Europe.
• The Italian company Seven S.R.L. was acquired. Seven designs and markets spec- tacle frames and is based in Pederobba, northern Italy.
• Scandinavian Eyewear celebrated 60 years in the industry by designing a retro collec- tion, Skaga Originals, in which Skaga de- signers Anna Mälstad, Carina Mollsjö and Gustav Kristensson updated six frames based on authentic Skaga models from the 1950s and onwards. The collection was well received by retailers, end customers and the fashion media.
sC an d i na v i an ey ewe ar 2004 2005 2006 2007 2008
net sales, SEk m 87.9 94.9 119.3 122.3 113.1
operating profit, SEk m * 13.9 14.1 31.5 15.8 3.9
operating margin, % 15.8 14.9 26.4 12.9 3.5
Capital employed, SEk m 27.0 31.8 48.9 36.5 30.1
Return on capital employed, % 55.1 48.4 78.4 38.2 13.1
Investments, SEk m 3.2 5.3 2.3 1.8 1.8
Average number of employees 43 39 44 46 49
* excluding administration fees to the Parent Company. The operating profit for 2006 contained
governance and application of the code
Lammhults Design Group AB is a Swed- ish company with limited liability (Swed- ish: aktiebolag). Its registered office is in Växjö, Sweden. The Company is governed via the Annual General Meeting of Share- holders (AGM), the Board of Directors and the CEO in accordance with the Swedish Companies Act and the Com- pany’s Articles of Association, as well as Nasdaq OMX Stockholm’s Regulations for Issuers, including the Swedish Code of Corporate Governance (the Code).
Effective 1 July 2008, a revised code of corporate governance includes all compa- nies that are quoted on the OMX or NGM Exchanges. Governance in the Group has been based on the Code since then. The aim of the Code is to establish conditions favouring an active and responsible own- ership role. It is one part of self-regulation in the Swedish business sector. The Code is based on the principle of comply or ex- plain, which means that it is not a crime to deviate from one or more rules in the
Code provided that a justification exists and is explained. Lammhults Design Group does not have any deviations from the Code in 2008 to account for.
The 2008 Corporate Governance Report does not constitute part of the for- mal annual report documents and has not been examined by the Company’s auditor.
the role of the annual general meeting of shareholders Shareholders’ influence in the Com- pany is exercised at the Annual General Meeting (AGM), which is the Company’s highest decision-making body. At the AGM (ordinary general meeting of shareholders), shareholders vote on reso- lutions, for example, on adoption of the annual accounts and the consolidated financial statements, filing of the Com- pany’s results, discharging the Members of the Board and the CEO from liability, election of the Board and Chairman and, where appropriate, an auditor, how the nomination committee is to be consti- tuted, remuneration to the Board and the
auditors and guidelines on remuneration to the CEO and other senior executives.
annual general meeting of 2008 Lammhults Design Group AGM, held on 29 April 2008 was attended by around 100 shareholders and guests. The shareholders in attendance represented 70 percent of the total number of voting rights in the Company. The 2008 AGM adopted the annual accounts and con- solidated financial statements for 2007 presented by the Board of Directors and the CEO, resolved to authorise filing of the Company’s results and discharged the Members of the Board and the CEO from liability. The AGM resolved on election of an auditor and on remuneration to the Board of Directors, auditor and senior executives in accordance with the recom- mendations of the nomination commit- tee. The following Board Members were re-elected Torbjörn Björstrand (Chair- man), Yngve Conradsson, Jerry Fredriks- son, Erika Lagerbielke, Lotta Lundén and Johan Sjöberg. The AGM further resolved
cOrpOrate gOVernance repOrt
to issue no more than 87,500 warrants to the Group’s senior executives, to au- thorise the Board to resolve to issue of no more than 1 million Class B shares, and to approve the Board’s proposal to change the Company’s name from Expanda AB to Lammhults Design Group AB. Dividend was set at SEK 3.00 per share, made up of ordinary dividend of SEK 2.50 per share and extra dividend of SEK 0.50 per share.
the role of the nomination committee
The AGM resolved that the Chairman of the Board should, no later than at the end of the third quarter every year, call a meeting with the four largest sharehold- ers in terms of equity stake or voting rights in the Company. These parties will then each appoint one member, who should not be a Member of the Board, of the Nomination Committee. The role of the Nomination Committee is to propose to the AGM the number of Board Mem- bers, the Chairman of the Board, other Board Members and the remuneration of the Board and the auditors. The Nomina- tion Committee also proposes the auditors in the years in which an election shall take place. The Nomination Committee for the 2009 AGM consists of the following persons: Anders Hultman (Chairman, ap- pointed by Scapa Capital), Erik Sjöström (appointed by Skandia Life Assurance Company), Gunnar Lindberg (appointed by LF Småbolagsfond) and Lars Johans- son (appointed by Jerry Fredriksson).
the role of the board of directors According to the Swedish Companies Act, the Board of Directors has overall responsibility for the organisation and administration of the Group, as well as for overseeing that the quality of financial reporting, asset management and other financial conditions is satisfactory. The Board takes decisions on issues relating to the Group’s overall objectives, strategic direction and policies, as well as on major issues relating to finance, acquisitions, disposals and investments. The work of
the Board of Directors of Lammhults Design Group AB is governed by the rules of procedure that are annually adopted by the statutory Board meeting. The rules of procedure regulate the Board’s working methods and overall tasks, the holding of meetings, the formulation of ongoing financial reporting and the allocation of tasks between the Board and the CEO.
The relevance and timeliness of the rules of procedure are reviewed every year.
During the year, the Board of Direc- tors held five ordinary meetings and three extraordinary meetings in addition to the statutory meeting. The meetings were devoted to financial follow-up of operations, strategic issues, budget dis- cussions, acquisition and disposal issues and external financial information. The CEO and the CFO take part in the meet- ings of the Board, in a reporting capacity.
The Board meetings were prepared by the CEO and the CFO. The CEO pro- vided the Board Members with written reports and supporting documentation at least five working days prior to each respective meeting. The Board meetings were alternately held in the Parent Com- pany’s offices in Lammhult and at the of- fices of the various subsidiaries. Minutes of each meeting were kept by the CFO, and checked for accuracy first by the Chairman and then by one other Board Member prior to their distribution to the Board. The Members of the Board received monthly reports regularly during the year, informing them of the financial and operational developments in the Group. The reports were drawn up jointly by the CEO and the CFO.
board of directors - attendance and evaluation
A total of nine meetings were held in 2008, five after the AGM. The attend- ance at these meetings was as follows:
Torbjörn Björstrand (9), Lennart Bohlin (3), Yngve Conradsson (9), Jerry Fre- driksson (8), Erika Lagerbielke (9), Lotta Lundén (8) and Johan Sjöberg (9). The Board Chairman ensures that the work
of the Board is evaluated once a year. In addition, the Board evaluates the work of the CEO. The results were reported at the Board’s regular meeting held in February 2009. On the basis of the results, meas- ures are being taken on an ongoing basis by the Chairman and management to improve the quality of work by the Board.
composition of the board
According to the Articles of Association, the Board is to be made up of no less than five and no more than twelve members, with no more than five deputies. Since 2005, the Chairman of the Board has been Torbjörn Björstrand. All Board Members are independent of the Compa- ny and the Company’s management. One of the Board Members, Yngve Conrads- son, has a relationship of dependence with the biggest shareholder, Scapa Capi- tal AB, while another, Jerry Fredriksson, has a relationship of dependence with the second biggest shareholder, Canola AB. The other four Board Members are independent of the biggest shareholders.
For further information on the individu- al Board Members, see page 48–49.
FeLix easY Chair Designer: LoVe arbén Year oF LaunCh: 1993
