Development over the year


BE Group is a trading and service company in steel, stainless steel and aluminum. Customers mainly operate in the manufacturing and construction industries in Sweden, Finland and Baltics, where BE Group is one of the leading actors in the market. The Group has approximately 700 employees, with operations in seven countries and head office located in Malmö, Sweden. BE Group’s stock is listed on the Nasdaq Stockholm Exchange. Read more about BE Group at

Alternative performance measures

BE Group has defined a number of alternative performance measures. The alternative performance measures that BE Group considers to be significant are underlying operating result, net debt, working capital and capital employed. Under the tab Alternative performance measures, you can read more about how these are calculated.

Market and business environment

According to the steel producers’ industry organization, the World Steel Association, raw steel production increased in Europe (EU28) by 4.1 percent in 2017 compared with the previous year. Demand has increased on a broad front in many customer segments, including infrastructure, mining equipment, mechanical industry and automotive. The import of materials continued to decrease as an effect of the EU’s introduction of customs duties on a number of material types, but also on the grounds of higher prices in Asia. This has created a generally good balance between supply and demand, even if there are exceptions. The information BE Group has regarding the development of the Swedish distribution market shows a market growth of 4.1 percent. The steel prices increased during the year.

Group structure and organization

The Group consists of two business areas, Sweden & Poland and Finland & Baltics, with a business focus on the Group’s main markets. Within respective business areas, there are separate business units that focus on Distribution and Production. The objective with this division is to get a clearer focus and higher transparency to more easily be able to identify and implement improvement measures. Parent Company & consolidated items include the Parent Company, Group eliminations and also parts of the Group´s operations undergoing restructuring, BE Group Czech Republic, BE Group Slovakia, RTS Estonia and since the fourth quarter of 2017 also BE Group Produktion Eskilstuna.

Net sales and business performance

During 2017, consolidated net sales increased by 12 percent compared with the previous year, amounting to SEK 4,348 M (3,870). Tonnage in business areas Sweden & Poland and Finland & Baltics increased by 4 percent each compared with the previous year. Higher average steel prices have had a positive impact on net sales of 14 percent. The price trend also resulted in inventory gains of SEK 27 M (28).

Gross profit amounted to SEK 619 M (561), with a gross margin of 14.2 percent (14.5). The result was negatively effected by items affecting comparability of SEK -52 M, mainly attributable to the closure of the unprofitable operations in Eskilstuna, inventory adjustment in the Czech Republic (Prerov) and maintenance of a warehouse in Malmö. In spite of this, the operating result amounted to SEK 57 M (16). The improved earnings are attributable to higher net sales as a result of tonnage growth in the main markets, and price and mix effects. Adjusted for items affecting comparability and inventory gains and losses, the underlying operating result increased to SEK 82 M (33).

The operating margin amounted to 1.3 percent (0.4) and the underlying operating margin was 1.9 percent (0.9).

Net financial items and tax

Consolidated net financial items amounted to SEK -23 M (-27), of which net interest accounted for SEK -17 M (-19). On an annual basis, the consolidated net interest corresponded to 3.2 percent (3.4) of the average interest-bearing net debt. Tax amounted to SEK -10 M (-9). Result after tax improved to SEK 24 M (-20).

Cash flow

Cash flow from operating activities improved to SEK 95 M (78) for the full year. The positive cash flow has largely been generated from the operating activities’ results, but also thanks to working capital decreasing somewhat despite higher sales volumes. The cash flow from investing activities amounted to SEK 5 M (-10) for the full year and cash flow after investments thereby amounted to SEK 100 M (68).

Capital, investments and return

At the end of the period, consolidated working capital amounted to SEK 492 M (506) and average working capital tied-up was 11.8 percent (12.6). Of the year’s investments, totalling SEK 22 M (10), investments in intangible assets accounted for SEK 2 M (2) and investments in tangible assets for SEK 20 M (8). The return on capital employed increased in comparison with that in the previous year and amounted to 4.2 percent (1.2).

Financial position and liquidity

At the end of the period, consolidated cash and equivalents, including overdraft facilities, were SEK 161 M (127) and consolidated interest-bearing net debt amounted to SEK 478 M (562). At the end of the period, equity totalled SEK 802 M (771), while the debt/equity ratio improved to 60 percent (73).

BE Group’s fundamental values act as a guide in the day-to-day work of everyone within BE Group. They address how we act towards one another, as well as towards customers, suppliers and others with whom we come into contact.


BE Group considers the employees to be the Group’s most important resource. On many occasions, it is one or a few individual employees who are the outward face towards a specific customer or supplier and it is therefore important that everyone who works at BE Group should contribute to us being perceived as an economically, socially and ethically responsible company. It is the people at BE Group who make things happen and make it possible for the Company to keep its promises. The corporate culture is based, among other things, on what BE Group has defined as its fundamental values. These values act as guidance in the day-to-day work of everyone within BE Group. They address how we behave towards one another, as well as towards customers, suppliers and others with whom we come into contact. These are: Dynamic, transparent and sustainable. Read more under the tab Strategic focus.

The number of employees decreased to 665 compared with 711 at the same time last year. The decline is mainly due to the restructurings that have been done. The average number of employees during the year amounted to 700 (739).

Environmental policy and environmental work

For a long time, BE Group has been working with environmental issues as an integrated part of its operations. With its position between steel producers and customers, it is in the area of transport in particular that BE Group is able to help lessen the environmental impact. In addition, BE Group works continuously to improve its own facilities’ energy consumption, emissions and waste management.

Overarching environmental policy

A comprehensive environmental policy forms the basis of BE Group’s environmental work. The policy states that BE Group shall

  • As a minimum comply with current environmental legislation and requirements from local authorities.
  • Be economical in the use of energy and natural resources.
  • Work to decrease the amount of waste and emissions from our facilities.
  • Identify opportunities to make adjustments benefiting the environment when making investments and changes in processes and facilities.
  • Maintain a high level of awareness on environmental issues through ongoing training.
  • Document and communicate environmental work to employees and provide open and objective information to external stakeholders.

BE Group is engaged in operations at two sites in Sweden for which environmental permits are required. In Finland, operations in one site require environmental permits. Group companies have obtained special permits to engage in operations in the countries where such permits are required. All operations within the Group, with the exception of operation in Lithuania and Lecor Stålteknik, are certified under the ISO 14001 environmental management system.

Risks and risk management in BE Group

BE Group’s profits and financial position are affected by a large number of factors. Several of these are beyond the Company’s own control. The Group operates in several countries and is therefore exposed to various risks as a consequence of differences in legislation, regulations and guidelines. Risk management within the Group is guided by established policies and procedures that are revised by the Board of Directors and/or Group Management on an ongoing basis. The most important risks and factors of uncertainty for BE Group can be divided between:

  • Market risks (economic and steel price trend)
  • Operational risks (suppliers, customers, contractual relationships, personnel, product liability, legal and environmental liability)
  • Financial risks (currency risk, interest risk, refinancing risk and credit risk)

Market risks

Economic trend

BE Group has a large number of customers in different industries and is therefore affected by the general economic climate. A weak economic trend increases the risk of lower demand for the Group’s products, resulting in lower sales revenues. In addition, a weaker economy can lead to low inventory turnover, falling prices and inventory losses on existing inventories. BE Group’s strategy regarding inventory levels is to warehouse products based on estimated customer demand. The various companies in BE Group strive to maintain a level of inventory turnover suited to the market and local conditions of each company. The operational control of inventory levels is exerted by means of targets for the number of inventory days.

Steel price trend

The steel industry is influenced by economic developments. As a consequence, steel price trends are volatile and are affected by the balance between the production offering and demand for steel at the different points along the value chain.

Steel prices affect BE Group such that higher market prices provide a greater contribution towards covering the Group’s costs given a constant gross margin. The steel price trend also affects final sales prices for products held in inventory, which for BE Group entails a financial impact in the form of inventory gains and losses. To limit these inventory effects, BE Group is working actively to reduce the number of inventory days while maintaining its level of service towards customers. Consequently, falling steel prices have a negative impact on BE Group’s operations and earnings, while increased prices have a positive impact.

The table below shows the estimated effect on underlying operating result of changes in steel prices and sold tonnage. The sensitivity analysis is based on the outcome for 2017 and assumes a constant underlying gross margin.

Change Operating result effect
Steelprice +/-5 % +/-25 MSEK
Tonnage +/-5 % +/-25 MSEK

Operational risks

Insufficient deliveries

BE Group’s product range consists of materials from several different suppliers. The Group strives to establish relations with the best steel producers and to maintain sustainable, long-term cooperation. To safeguard access to materials on each individual occasion, the Group seeks to always maintain relations with several suppliers in each product group. Over the year, BE Group has cooperated with more than 500 suppliers. Before establishing new business relationships and entering into agreements, suppliers’ capacity to meet BE Group’s demands in terms of finance, quality, logistics, the environment and other aspects is ascertained.

In BE Group’s assessment, it is not dependent on any single supplier and all major suppliers are considered fully interchangeable, so disruption to deliveries by any one of them does therefore not entail long-term consequences for operations. In 2017, the largest single supplier accounted for 15 percent (14) of the Group’s purchases. Combined, the ten largest suppliers accounted for 53 percent (52) of the Group’s total purchasing. BE Group is exposed to the risk that deliveries from suppliers could be substantially delayed in the event of interrupted production, capacity shortage or transport issues, outside the control of BE Group. This can mean loss of income and/or more expensive actions to meet our commitments to customers.


BE Group’s operations are conducted in several different markets and to numerous customer categories. The ten largest customers accounted for 13 percent (13) of total sales in 2017. BE Group has a large number of customers in different industries and consequently, a good risk diversification. The Company actively works to manage credit risks (see Note 31 for further information) by setting credit limits and focusing on collecting overdue debts. The credit losses for the year amounted to 0.0% (0.1) of net sales.

Increased direct deliveries from steel producers

Users of steel have mainly two sources of purchases: directly from steel producers or from trading and service companies. Traditionally, many large-scale users have bought directly from producers, while small and medium-sized users have often made use of trading and service companies. There is, however, a risk that producers will try to extend their direct sales, reducing the use of trading and service companies as agents.

Contractual relations

In accordance with current market practices, the majority of BE Group’s customers and its suppliers are not tied to the Group through long-term binding contracts. Instead, it is the Group’s custom to rely primarily on its good and often long-term relations with customers and suppliers, and on the normal practices that have been established between the parties. There are specific agreements with some of BE Group’s larger customers.

Human Resources

BE Group depends on competent employees for its future development and success. The ability to recruit, retain and develop qualified employees and to be an attractive employer is important. The effect on the operations would be negative if key individuals were to quit and without it being possible to recruit suitable replacements. BE Group has compiled a number of values that reflect the spirit of the Group and pervade its management. BE Group’s commercial competence is continuously developed through training and recruitment. Training efforts include broad programs aimed at many employees, as well as specialized solutions for individuals.

Product liability

In the event of defect products, some of the products that BE Group sells could cause personal injury or other harm, thereby incurring a risk of claims for damages in accordance with the product liability laws of the country concerned. BE Group has taken out the conventional liability insurance policies on its operations.


Since BE Group maintains operations in several countries, the Group is exposed to different laws, regulations, agreements and guidelines, as well as to changes in the stipulations within these. Among other things, regulations include trade restrictions, such as customs duties and tariffs, requirements for import and export licenses, restrictions on movements of capital and tax regulations. In all commercial operations, disputes may arise as a consequence of differences of opinion on issues of responsibility and interpretations of contract terms. From a risk perspective, BE Group is not dependent on any individual commercial agreement that could significantly limit the Group’s operations.

Environmental legislation and responsibility for the environment

BE Group’s operations are subject to legislation pertaining to the environment, as well as regulations on emissions to the atmosphere and water, waste management and the workplace environment. BE Group could become liable for environmental damage caused by operations conducted, or that have previously been conducted by the Company. According to Swedish law, certain environmental liability is not subject to limitations of time. It cannot be ruled out that operations such as those that are conducted, or have been conducted, by BE Group could lead to liability for environmental impacts that do not appear until much later.

Financial risks

For an account of financial risks, see Note 31.

Share-related information

Ownership structure

The BE Group share has been listed on the Nasdaq Stockholm Exchange since the end of 2006. At the end of the financial year, BE Group had 5,903 shareholders, compared with 6,303 at the end of the previous year. AB Traction and Catella Småbolagsfond were the two largest owners with 19.9 percent and 8.7 percent of the shares, respectively. Information on other major owners is available on the Company website. At the end of the year, the proportion of institutional ownership (legal entities) totaled 64 percent and foreign ownership was 12 percent.

At the end of the year, the four members of Group Management together held 61,700 shares in BE Group. At the same time, the Company’s directors together held 2,646,228 shares, including shares in close association. The disclosures regarding shareholdings in BE Group for the Board of Directors and Group Management refers to own and physically related owned shares, endowment insurance and legally owned shares which directly or indirectly is controlled by the person or its relatives.

BE Group held 26,920 treasury shares at the close of 2017.

Share capital, shares outstanding and rights

The registred share capital amounted to 13,010,124 (13,010,124) common shares. Each share has a quotient value of SEK 20.00 (20.00). According to the Articles of Association, minimum share capital in the Company is SEK 150,000,000 and maximum share capital SEK 600,000,000, with a minimum of 10,000,000 and a maximum of 40,000,000 shares. Share capital is determined in Swedish kronor.

All shares convey equal rights to a percentage of the Company’s net assets, profits and any surplus upon liquidation. Each share carries one vote and there is only one class of shares. There is no limit to the number of votes a shareholder may cast at the Annual General Meeting or with respect to transfer of shares. The Company is aware of no agreements between shareholders which may limit the right to transfer shares.

Further information about the BE Group share is provided on

Dividend and dividend policy

According to BE Group’s dividend policy, the Group will distribute at least 50 percent of profit after tax, over time. BE Groups financial positions and future outlook shall be taken into account in determining the payment of dividends. BE Group reports a cash flow after investments of SEK 100 M (68) resulting in a reduced net debt of SEK 478 M (562) and gearing decreasing from 73 percent to 60 percent. The ambition is that BE Group will develop a stronger balance sheet in the long term to be able to utilize business opportunities and become an even stronger counter part in relation to the company´s stakeholders. Against this background and despite expectations of continued good demand on the Group´s main markets, the Board of Directors proposes that no dividend will be paid for the financial year of 2017 (-).

Corporate governance

The Corporate Governance Report, which, among other things includes an account of the Group’s governance and the work of the Board of Directors over the year, is presented on the website

Remuneration principles for senior executives

The 2017 Annual General Meeting adopted guidelines for executive remuneration. The policies apply to remuneration and other terms of employment for the individuals who, while the policies are in effect, are members of Group management for BE Group.

Group managment consist of four persons: the President and CEO, the CFO, Business Area Manager for Finland & Baltics and the Group Sourcing Director.

The policies apply for agreements entered in accordance with Annual General Meeting resolutions and to amendments to existing agreements made after this date. The guidelines are reviewed annually.

The guidelines mainly state that remuneration for senior executives shall consist of fixed base pay, variable remuneration, pension benefits and other benefits. Total remuneration shall be market-based. Fixed pay shall be individual and differentiated based on the individual’s responsibilities and performance and set annually. Variable remuneration shall be related to the degree of meeting the annual predetermined, well-defined goals and shall amount to a maximum of 50 percent of fixed salary.

Pension is to be defined-contribution-based and correspond to a maximum of 30 percent of fixed annual salary.

Where notice of termination is issued by BE Group, fixed salary and severance pay shall not exceed an amount equivalent to 12 months’ fixed pay.

The actual remunerations agreed during the year are detailed in Note 3.

The Board of Directors’ preparation and resolutions in business related to salaries and other terms of employment for senior executives

The Remuneration Committee appointed by the Board of Directors shall prepare matters related to salaries and other terms of employment for executives. Decisions on remuneration to the President and CEO shall be taken by the Board of Directors in its entirety. In respect to other senior executives, decisions on salaries shall be taken by the Remuneration Committee based on proposals by the President and CEO.

Provisions of the Articles of Association on appointment and discharge of directors and amendment of the Articles of Association

There are no provisions in the Articles of Association on appointment and discharge of directors and amendment of the Articles of Association. In accordance with the provisions in the Companies Act, directors are elected by the Annual General Meeting for the period extending until the close of the first Annual General Meeting after that at which they were elected, and amendments to the Articles of Association are determined by the Annual General Meeting in accordance with the regulations set out in the Companies Act.

Contingent liabilities

Consolidated contingent liabilities amounted to SEK 30 M (17).

Significant events after the end of the financial year

No significant events have taken place after the end of the period.

Parent Company

Sales for the Parent Company, BE Group AB (publ), amounted to SEK 92 M (25) during the period and derived from intra-Group services. The operating result amounted to SEK 38 M (-26). Net financial items, which were negatively impacted in both years by impairment of shares in subsidiaries and this year also by intra-Group receivables, amounted to SEK -22 M (-50). The result before tax was SEK 0 M (-67) and the result after tax was SEK -1 M (-57). At the end of the period, Parent Company equity amounted to SEK 557 M (558). During the year, the Parent Company invested SEK 0 M (1) in intangible assets. At the end of the year, cash and equivalents in the Parent Company amounted to SEK 44 M (9).

Accounting principles

As of January 2005, the consolidated accounts are prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Commission for application within the European Union. A more detailed explanation of accounting principles is available under “Accounting principles”.

Outlook for 2018

Demand during the upcoming quarter is expected to remain strong in the company’s main markets. The construction industry is still going strong even though growth seems to have slowed down slightly. Within manufacturing several customers forsee a continued growth in 2018. Demand and the increasingly regional steel market makes steel prices expected to remain in level with fourth quarter during the upcoming period. Ongoing improvement measures together with the completed closure of unprofitable operations continue to strengthen the Group’s profitability.

Appropriation of earnings

The Board of Directors’ proposal for the appropriation of earnings is detailed under Appropriation of Earnings and in note 24.