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ANNUAL REPORT 2013
ZINZINO
ZINZINO
Zinzino AB is a leading direct sales company, represented in Sweden, Norway,
Denmark, Finland, Iceland, Lithuania, Latvia, Estonia and the USA.
Zinzino markets and sells espresso machines, coffee, tea and accessories along
with a product line in functional food, Zinzino Food.
We offer customers products that are centred around quality, environment,
health and a feeling of everyday luxury. Our values are based around high
quality, proximity to the customer and a focus on active product development.
Our products are marketed through direct selling.
The company has around 50 employees and has its head office in Gothenburg.
Our best year yet!
2013 was an eventful year. We opened a sales company and
office in the USA, implemented major changes in our warehouse
and logistics management and saw our new Balance products
take sales to new heights. But, 2013 will be most remembered
as the year that we really made our mark on customer focus and
customer growth! 2013 was the best year in Zinzino's history
in many ways, but I promise that 2014 will be even better!
Dag Bergheim Pettersen
CEO, Zinzino
CONTENTS
A brief history of the company 1
Lithuania
18
CEO's statement2
Latvia19
Figures at a glance 3
USA20
2013 in review, quarters 1-2
4
Direkthandelns Förening
21
2013 in review, quarters 3-4
5
Head office in Gothenburg
22
Significant events after year-end
6
Board of Directors
23
Our product lines
7
Management24
Balance products
8
Financial information
Zinzino BalanceTest9
Directors' report
27
Fairtrade
10
Future financial targets
29
Coffee
11
Ownership and share performance
30
Share price development 31
Results and financial position
32
Quick facts
Norway12
Sweden
13
Denmark14
Income statement33
Balance sheet, assets
34
Balance sheet, equity
35
Finland
15
Cash flow statement
36
Iceland
16
Additional information
37
Estonia
17
Notes to individual items
38
ANNUAL GENERAL MEETING
The annual general meeting will be held on Friday 16 May at 1:00 pm in the company's offices at Hulda
Lindgrens gata 8 in Gothenburg. The Annual Report is available at www.zinzino.com and www.aktietorget.se.
REPORT CALENDAR:
Quarterly report Q1
Half year report
Quarterly report Q3
25 April 2014
29 August 2014
24 October 2014
BRIEF HISTORY
Business activities commenced in autumn 2007. The principal activity of the business is to own
and develop companies in direct marketing and related businesses.
In 2009, Zinzino Nordic AB was acquired through both a directed issue in kind to shareholders
in Zinzino Nordic AB and through the rights issue Zinzino Nordic conducted in December 2009.
This gave Zinzino AB control over 97% of votes and 92% of capital in Zinzino Nordic AB.
By 31 December 2013, participating interest had increased to 93% of capital.
Since 20 September 2010, Zinzino AB has been listed on the Aktietorget stock exchange.
Share performance has been very positive, particularly over the past two years.
In 2011, the Group expanded with companies in Estonia and Lithuania. In 2012, companies
were also launched in Latvia and Iceland. In 2013, a company was founded in the USA, with
its seat in Jupiter, Florida. Unlike previous group structures, the new subsidiaries are directly
owned by Zinzino AB.
GROUP STRUCTURE
Zinzino AB
Zinzino Nordic AB
93%
SIA Zinzino
(Latvia)
100%
Zinzino Annual Report
Zinzino Ehf
(Iceland)
100%
Zinzino
Sverige AB
100%
Zinzino Oy
(Finland)
100%
Zinzino Aps
(Denmark)
100%
Zinzino AS
(Norway)
100%
Zinzino UAB
(Lithuania)
100%
Zinzino OÜ
(Estonia)
100%
Zinzino LLC
(USA)
100%
1
“
“
Customer focus is the common
denominator of all of our processes
and is a key factor for further growth
and profitability.
Dag Bergheim Pettersen, CEO:
CUSTOMER IN FOCUS
At Zinzino, we are very proud that our growth continued to
increase as planned in 2013. All of Zinzino's markets increased
in growth compared with the previous year. This shows that our
concept and our products continue to be a hit! This gives us great
confidence and belief that we will succeed in the USA, which is
the world's largest direct selling market. In 2013, we opened an
office in Florida and launched Zinzino USA. This serves as a source
of inspiration and courage within the organisation for continued
expansion of the Group. Germany, Poland and the Netherlands
are next in line in 2014.
We look back on 2013 as the year we really made our mark on
customer focus and customer growth. We have thought through,
adjusted and implemented several changes to further improve
the customer satisfaction of both existing and new customers.
In 2013, we developed and made significant investments in our
range and our Customer Service department, which is one of
the areas for which we receive a lot of positive feedback from
our customers and distributors. Customer focus is the common
denominator of all of our processes and is a key factor for further
growth and profitability.
Logistics is also a key focus area where we worked in a structured
and target-oriented manner in 2013. All of our customers and
distributors get their products from us by post. It is therefore
vital to customer satisfaction that logistics functions optimally.
In 2013, we moved our warehouse and logistics management to
a global third party. This change makes us faster and better able
to handle large growth and ventures into new markets. Logistics is
an important factor in achieving our long-term target of 1 million
customers by 2020.
Zinzino Annual Report
The focus on the new product line Zinzino Food, with our Balance
products, has been a huge success since its launch at the end of
2012. We now have two product lines, Coffee and Food – both
of which are doing well and are experiencing growth. We have
seen that our distributors are increasing sales in Food, compared
with Coffee. With Food, we have found new target groups and
we see extremely high potential for growth in these segments.
The success and the positive feedback we receive motivate the
organisation and the distributors and foster a strong belief that
we will increase our customer base significantly in the coming
years. Another pleasant side effect of the increased sales in
Food is that our cost of goods is decreasing while profitability is
increasing. Our cost of goods in 2013 was 4% less than in 2012.
This itself is a small feat and bodes well for coming years.
Zinzino has invested and will continue to invest heavily in coming
years to achieve its growth and profitability targets. For example,
we invested in trademark protection in over 80 countries. IT is
another area in which we will invest relatively heavily, enabling us
to reap great benefits later on. This includes both new web shops
and structural system changes. Product development is also given
high priority for investments in coming years. And, as mentioned
previously, both new markets and continued focus on customer
service and support to our talented and loyal distributors are also
high on our list.
2013 was the best year in Zinzino's history in many ways, but I
promise that 2014 will be even better!
“The best is yet to come.”
CEO Zinzino, Dag Bergheim Pettersen
2
FIGURES AT A GLANCE
Zinzino entered 2013 on the heels of its strongest year ever. Growth in 2012 was an incredible 75% and
total sales had increased from SEK 101.4 million to SEK 177.2 million. Zinzino's Board of Directors and
management decided to continue the company's aggressive strategy. An extremely tough sales target
was set in combination with a challenging operating profit target. At the same time, several major
projects were slated for implementation during the year, including establishment in the USA.
Now that the figures for 2013 have been added up, it is clear that total income amounted to SEK
254.5 million, representing a growth of 43%. Operating profit, which totalled SEK 10.5 (5.3) million, had
almost doubled. In addition to this, the Group established a company and began selling its products in
the USA, transitioned to external logistics and developed a new product line. Despite the investment
costs, the gross profit margin improved through streamlining of business operations.
The geographic distribution of sales in 2013 and sales growth compared with the previous year can
be broken down as follows on the map:
FINLAND
NORWAY
USA
0.2% n/a
18% 41%
30% 21%
ICELAND
8%220%
ESTONIA
DENMARK
13% 26%
11% 67%
SWEDEN
10% 2%
LATVIA
LITHUANIA
5%176%
5%159%
Geographic distribution of sales 2013
Sales growth per market in 2013 compared with previous year
FINANCIAL SUMMARY (SEK million)
Zinzino Annual Report
GROUP
2013
2012
Net sales
226.3
161.6
Total income
254.5
177.2
Gross profit margin
28%
24%
Operating profit
10.5
5.3
Operating margin
4.11%
2.97%
Profit/loss before tax
10.4
5.3
Net income
9.0
4.6
Earnings per share (SEK) 0.33
0.17
Liquid assets
10.9
16.5
Equity/assets ratio
38%
26%
Equity per share
0.8
0.46
3
1
2013 IN REVIEW
FIRST QUARTER
The first quarter of 2013 was marked by strong growth. As the cooperation with Zinzino's provider of payment solutions in Sweden, Norway,
Denmark and Finland no longer worked well, it was terminated at the beginning of March. During the first quarter, work began for establishment
on the American market and there was a transition to an external logistics provider. Moving to an external provider gives the Group greater
opportunities to increase capacity at short notice, which will facilitate Zinzino's expansion.
The new product line Zinzino Food was further developed during the first quarter, and a new flavour of BalanceOil was launched. The increased
amount of capital tied up in inventory related to the launch of new product lines challenged the Group's short-term liquidity. Zinzino therefore took
measures and improved procedures related to the forecast of purchases, which reduced inventory levels. In connection with the Group's change of
banks, operating financing increased by SEK 6 million.
Net sales for the first quarter amounted to SEK 49.0 (27.2) million, representing a growth of 80%. Operating profit amounted to SEK 126,000 (-772,000).
Divided between the product lines, Coffee accounted for 80% and Food for 20%.
During Q1, the Group registered 11,300 (3,300) new customers. The sales force increased by 2,700 (1,300) distributors.
Growth
vs.mot
Q1 föregående
of previous år
year
Tillväxt per
per market
marknad
Q1
450%
425%
400%
350%
300%
250%
200%
166%
150%
100%
48%
50%
34%
30%
9%
0%
2
SV
NO
FI
DK
IS
LIT
0%
n/a
LAT
SECOND QUARTER
The second quarter's net sales totalled SEK 46.6 (28.1) million and operating profit/loss was SEK 1.2 (-1.4) million. Total second quarter growth in
the Group was 68% compared with the previous year.
The percentage spread of sales across the product lines in the second quarter of 2013 was 67% for Coffee and 33% for Food. Sales for Coffee
were SEK 31.3 (28.7) million, representing a growth of 10% compared with the same period of the previous year. Sales for Food amounted to
SEK 15.3 million.
Work to start operations in the USA continued during the second quarter via the newly established company Zinzino LLC. The decision was made to
establish a local sales office in the USA. This was situated in Jupiter, Florida, while the warehouse and logistics function for the American market was
situated in Norfolk, Virginia. Even at this early stage, potential distributors on the market were beginning to show great interest in the company.
Further development of the Zinzino Food product line continued and the range was expanded with additional products – BalanceShake and
BalanceBar. Sales of the product line did extremely well, increasing from SEK 9.5 million in Q1 to SEK 15.3 million in Q2.
The new product line continued to be a hit and took off faster than expected, causing the Coffee concept to gradually decrease in volume. Zinzino
Coffee increased by 10% during the second quarter. One consequence of this was that the espresso machine inventory did not reduce as planned,
which tied up capital and affected the Group's short-term liquidity. Zinzino continued to work intensively with inventory optimisation and normal
levels were expected to be achieved in Q4.
During Q2, the Group registered 8,566 (3,214) new customers. The sales force increased by 1,845 (1,509) distributors.
Growth
vs.mot
Q2 föregående
of previous år
year
Tillväxtper
permarket
marknad
Q2
300%
240%
250%
200%
139%
150%
100%
50%
52%
50%
NO
FI
18%
34%
n/a
0%
SV
Zinzino Annual Report
DK
IS
LIT
LAT
4
3
THIRD QUARTER
Zinzino's net sales for the third quarter of 2013 amounted to SEK 57.3 (44.2) million, representing a growth of 29%. Operating profit totalled
SEK 4.3 (2.8) million, which were the best results for a single period in Zinzino's history.
During the third quarter, Zinzino transitioned completed to the new external logistics solution and thus phased out its own warehouse operations.
The transition process was extensive and required significant investments in appropriate IT technology. Logistics is running smoothly and Zinzino is
reaping huge benefits from the solution.
The percentage spread of sales across the product lines in the third quarter was 58% for Zinzino Coffee and 42% for Zinzino Food. Sales for Coffee
were SEK 33.2 million while sales for Food were SEK 24.1 million.
Establishment on the US market entered its final phase during the quarter and Zinzino's management team worked closely with staff in the USA to
get the final pieces to fall into place for the start of sales. The biggest challenges were in the US banking system, but after hard work Zinzino was
granted permission to take payments via internet and credit card.
A company sales record was set on 15th October when 2,200 new customers were registered in a single day. In total, 2,761 (3,186) new distributors
and 11,159 (7,349) new customers were added during the quarter.
Growth
vs. Q3
of föregående
previous yearår Q3
Tillväxtper
permarket
marknad
mot
250%
234%
200%
160%
150%
93%
100%
45%
50%
9%
12%
18%
SV
NO
FI
29%
0%
4
DK
IS
LIT
LAT
EST
FOURTH QUARTER
Fourth quarter net sales amounted to SEK 73.4 (62.1) million, representing a growth of 18%. Divided between the product lines, Zinzino Coffee
totalled SEK 37.0 million and Zinzino Food totalled SEK 36.4 million. This means that sales in general were evenly spread between the product
lines.
Zinzino Food launched its sales in the USA in early December with the products BalanceTest, BalanceOil and BalanceShake. By year-end, sales
had already spread to 23 states, indicating great potential for continued geographic expansion and strong sales. The local office was established
in Jupiter, Florida and the warehouse in Norfolk, Virginia.
A total of 17,165 (12,330) new customers and 3,057 (2,507) partners were registered during the quarter.
Never before has Zinzino had so many active customers as it had at the end of 2013.
Growth
vs.mot
Q4 of
previous year
Tillväxt per
permarket
marknad
föregående
år Q4
450%
416%
400%
350%
300%
250%
200%
167%
150%
108%
100%
50%
10%
16%
FI
DK
0%
-50%
-100%
SV
-17%
Zinzino Annual Report
NO
0%
IS
LIT
-38%
LAT
EST
5
SIGNIFICANT EVENTS AFTER YEAR-END
STRONG GROWTH AND
IMPROVED BOTTOM LINE
IN Q1
All markets showed growth in Q1. Total income amounted
to about SEK 75 million, representing growth of almost 40%.
Profit before tax in Q1 was also better compared with the
previous year, amounting to SEK 2.9 (0.0) million.
OFFICIAL LAUNCH
IN THE USA
The market was officially opened on 8 February 2014.
This was celebrated with a “Launch Celebration Day”
in Atlanta, Georgia. Approximately 200 enthusiastic
American and European independent sellers were on
hand to celebrate the opening, along with representatives
from the company.
Interest in the company on the American market is
huge. Management and the local Zinzino staff in Florida
are working closely with the market's distributors to
provide training and find the best possible tools to ensure
continued stable growth. Development in the USA is
going according to plan and Q1 sales amounted to about
$500,000 (approx. SEK 3.3 million).
INCREASED OWNERSHIP
IN BIOACTIVE FOODS AS
NEW DIVIDEND POLICY
AND COMMUNICATION
OF FUTURE FINANCIAL
TARGETS
Zinzino Annual Report
To strengthen its influence in Bioactive Foods AS, Zinzino
has increased its holding in the company from 6% to
10% through an additional investment of SEK 2.4 million.
Greater ownership in Bioactive Foods AS ensures access to
products, skilled researchers and the production of goods
within the framework of Zinzino Food. Over the long term,
Zinzino expects the ownership in Bioactive Foods AS to
generate lower cost prices, which will ensure better gross
profit margins and in turn a stronger bottom line.
Zinzino's Board of Directors has decided from the 2013
financial year to propose that the annual general meeting
approves a dividend of 30% of the net income to the
shareholders annually, provided that the liquidity and
financial strength of the Group permits this. The future
financial targets are presented under the heading
“Financial information” later in this report.
6
OUR PRODUCT LINES
ZINZINO COFFEE
ZINZINO FOOD
At Zinzino, we love coffee. With Zinzino Coffee
you can easily make your own latte, espresso or
cappuccino. With accessories such as cups, glasses,
confectionery and milk frothers, you can create a
complete café experience right in your own home.
Our Balance Food product line focuses on longterm health. Zinzino BalanceOil contains a unique
combination of fish and olive oil that adjusts the
fatty acid balance in the body. A simple blood test
for home use reveals your balance values.
Zinzino Annual Report
7
ZINZINO BALANCE
BALANCE PRODUCTS
QUALITY + SYNERGY = RESULTS
BalanceOil is more than just fish oil. Our scientists have formulated BalanceOil for results. This includes selecting the species of
fish with attention to content of EPA and DHA (bio-active omega-3
essential fatty acids), then synergistically combining this with a
special, high-quality high-polyphenol olive oil. Our formulation,
plus use as recommended, is why BalanceOil and BalanceShake
help adjust the omega-6 to omega-3 ratio to optimal levels for
balance. And, our data show proven results of balance (near
3:1 ratio) within 120 days.
FISH OIL
Our fish oil, containing sardines, anchovies and mackerel, comes
from Lysi, a leading fish oil manufacturer in Iceland. Iceland
specialises in fisheries and 70% of its economy relates to fish in
some way. Lysi meets all regulatory requirements for production
and follows good manufacturing practice (GMP) for food products
and pharmaceuticals. Our products are free of genetically
modified organisms (GMOs).
Zinzino Annual Report
HIGH-QUALITY OLIVE OIL
We use extra-virgin olive oil from Spain. The olive oil is cold
pressed, which means that a minimal amount of heat is used
when the oil is pressed out of the olives. With this method,
the oil retains the nutrients normally lost during heating, solvent
extraction and refining of the oil.
PROOF OF BALANCE WITHIN 120 DAYS
St. Olavs Hospital in Trondheim, Norway and other leading
laboratories have tested 37,070 people as of 22 January 2014.
The average omega 6:3 ratio for individuals not taking an
omega-3 supplement was 11.9:1 in Europe and 28.1:1 in the
USA. Individuals who were taking an omega-3 supplement had
a balance value of 7.0:1 in Europe and 18.7:1 in the USA. Of the
5,541 people who took Zinzino BalanceOil as recommended for
120 days, the average balance ratio was reduced to near 3:1.
These results show that on average use of BalanceOil reduces
the omega 6:3 ratio.
Source: BioActive Foods AS, Oslo, Norway.
8
ZINZINO BALANCE
ZINZINO OFFERS A UNIQUE
HEALTH TEST
Purchase Zinzino BalanceTest
Collect the blood sample at home
Send in your sample for analysis
Start using our
Balance products
Your first test results will be
available at www.zinzinotest.com
within 20 days
After 120 days, take our test
again to find out how your
values have changed
Are you in balance?
Zinzino's BalanceTest can give you the answer. We offer a unique test that
lets you know your balance values. Zinzino BalanceTest is a blood test for
home use that takes less than a minute. St. Olavs Hospital in Trondheim,
Norway and other leading laboratories analyse the test, which identifies the
levels of 11 fatty acids in your blood with 98% certainty. You will learn your
percentage level of omega-3 and your omega 6:3 ratio. You will also receive
a report to increase your health and dietary awareness.
Zinzino Annual Report
9
ZINZINO
Zinzino works continuously with environmental initiatives and
is affiliated with Elreturen, which recycles and disposes of old
espresso machines in a safe and reliable manner. Zinzino is
also a member of the Fair Trade Federation in Scandinavia.
At Zinzino, we have chosen to cooperate specifically with
Rombouts & Malongo because they have an active ethics policy
and an explicit strategy to work primarily with Fairtrade growers.
ROMBOUTS & MALONGO
Europe's most exclusive roasting house
Our coffee supplier is Rombouts, founded in Antwerp, Belgium in 1896.
Malongo is its sister company in Nice, France. The company is still familyowned and is proud of its traditions and its passion for coffee. Their vision
is to deliver the absolute highest quality of coffee from carefully selected
suppliers on small plantations, preferably Fairtrade and with unique flavours.
They only buy hand-picked beans processed using the wet method,
purchasing them on site at the plantation and inspecting every sack before
sending them to be slowly roasted and packaged. This has helped them earn
the honour of supplying the Belgian royal family and prestigious hotels and
airports across the globe in cities like Paris, New York, Tokyo and Dubai.
Zinzino Annual Report
10
ZINZINO COFFEE
WE BELIEVE IN A
TOTAL COFFEE EXPERIENCE
WE LOVE COFFEE
Coffee is a drink loved by countless people around
the world. Here at Zinzino, we not only think that
coffee should taste fantastic and maintain the
highest quality, we also believe it should be a total
experience.
ZINZINO COFFEE
Our goal is to take coffee to a whole new level.
And this is exactly what we will accomplish with
our Zinzino Coffee product line. The basic idea is to
offer people the chance to create their own home
café with the best products on the market.
Zinzino Annual Report
QUALITY
In addition to our professional and easy-care
machines, we also sell accompanying coffee pods
from the French suppliers Rombouts and Malongo
– known for their passion and precision Our product
range also includes Fairtrade coffee, which helps to
ensure proper working conditions, concern for the
environment and quality.
With Zinzino Coffee you can easily make your own
latte, espresso or cappuccino. With accessories such
as cups, glasses, confectionery and milk frothers,
you can create a complete café experience right in
your own home.
11
NORWAY
Norway is one of the three markets where Zinzino first began
selling its products in 2005. Product sales in the country are
through the subsidiary Zinzino AS. Since 2010, Norway has
been Zinzino's biggest market sales-wise and is the market
where Zinzino has the most registered distributors. In addition, Norwegians represent a large proportion of Zinzino's
ownership. 2013 saw the addition of 2,133 new distributors
and 11,228 new customers in Norway. These are the highest
number in both segments across the entire Group.
2013 was another successful year for the Norwegian market,
with stable growth of over 20%. Profitability was strong, with
earnings of SEK 9.7 million before operating expenses. This
made Zinzino AS the most profitable subsidiary in the Group
before intra-Group costs. As on several of Zinzino's other
markets, the new Zinzino Food product line is making up an
increasingly greater proportion of total sales. In 2013, Zinzino
Food accounted for 38% (SEK 25.4 million) of total sales.
SEK THOUSAND
Growth compared to previous year
21%
Percentage of Zinzino's total sales
30%
Net sales
67,299
Other revenue
10,254
Total income
77,553
Earnings before operating expenses
“
-67,865
9,688
“
Total direct costs
ZINZINO
FOOD
ZINZINO
COFFEE
38% of total sales
Total sales: SEK 25,404 thousand
62% of total sales
Total sales: SEK 41,895 thousand
ØYVIND AND KINE LIEN – NORWAY
Independent Zinzino distributors since 2010
As a partner in Zinzino, you have the freedom to make your own choices and
are responsible for your own bottom line. It takes a lot of hard work, but the
challenge and flexibility suits us as a family. We love Zinzino's products – they are
fantastic! We are extremely satisfied with the results from last year, particularly
since we saw huge customer growth. We have high hopes for 2014. We will
continue striving to increase customer growth and naturally make sure that
we keep our existing customers happy and satisfied.
Zinzino Annual Report
12
SWEDEN
SWEDEN
Sweden is Zinzino's home market and home to its head office
in Västra Frölunda, Gothenburg. Sweden is one of the three
countries in which Zinzino first began its operations. Sales and
growth on the Sweden market were stable in 2013. In total, 691
new distributors and 3,934 new customers were added during
2013. The market increased its sales at the start of 2014 and is
showing strength as regards both sales and growth.
The Swedish market has huge potential, particularly since
the head office is situated in Sweden. This means that all of
Zinzino's staff speak and understand Swedish and have vast
knowledge of the Swedish market. Like the other mature
markets, Zinzino Food has taken a large share of total sales
in 2013.
SEK THOUSAND
Growth compared to previous year
2%
Percentage of Zinzino's total sales
10%
Other revenue
Total income
Total direct costs
Earnings before operating expenses
35% of total sales
Total sales: SEK 7,988 thousand
22,519
3,014
25,533
-21,180
ZINZINO
COFFEE
4,353
“
Net sales
ZINZINO
FOOD
65% of total sales
Total sales: SEK 14,531 thousand
KATARINA SÖDERGREN – SWEDEN
Independent Zinzino distributor since 2005
I am passionate about helping people live a healthy life. In January, we started focusing on
developing leadership within the team. Sweden is a relatively large and elongated country.
Thus far, we have had too few leaders in relation to the size of the country. The more
key people we have in the different geographic areas, the faster the growth. I have high
expectations for 2014. We have been aggressive this year and will only continue to expand.
Zinzino Annual Report
13
DENMARK
Denmark is one of Zinzino's three original markets and has
shown steady growth for several years. In 2013, growth was
26% compared with the previous year. With total income of
SEK 34 million, the Danish market accounted for 13% of the
Group's total sales. As in the other mature markets, Zinzino
Food has had major penetration and accounted for 41% of
the total sales on the market in 2013. In total, 1,111 new
distributors and 5,687 new customers were added during the
year. Zinzino is investing major resources to ensure it is at the
forefront with product certifications from the Danish authorities. This, combined with a strong sales network, gives Zinzino
a profitable subsidiary in Denmark.
SEK THOUSAND
Growth compared to previous year
26%
Percentage of Zinzino's total sales
13%
Other revenue
Total income
Total direct costs
FOOD
41% of total sales
Total sales: SEK 12,525 thousand
30,290
3,750
34,040
-30,411
Earnings before operating expenses
IB NIELSEN – DENMARK
Independent Zinzino distributor since 2005
59%
3,629
ZINZINO
COFFEE
“
Net sales
ZINZINO
Percentage Coffee
59% of total sales
Total sales: SEK 17,765 thousand
Zinzino has helped me create a wonderful life for me and my family and has given me
the opportunity to help so many people over the past 8½ years. It takes a lot of focus
to work as an independent distributor and it takes time to reach your targets. But, it is
fantastic how much can be achieved by doing a little each week over a 5-year period.
The recent years have been fabulous, with many new, responsible leaders and growth
of 200% in my organisation. The number of customers who want to buy our products
has generally increased in Denmark. I expect the positive trend to continue in 2014.
Zinzino Annual Report
14
FINLAND
In 2005, Finland was the fourth market that Zinzino ventured
into. The market showed modest growth at first, but things
really took off in 2010. As a market, Finland has shown some
of the strongest growth within the Zinzino Group during the
period 2011 to 2013. In 2013, growth was 41% and the Finnish
market accounted for 17% of the Group's total sales. This
makes Finland Zinzino's second largest market.
SEK THOUSAND
Growth compared to previous year
41%
Percentage of Zinzino's total sales
17%
Other revenue
Total income
Total direct costs
Earnings before operating expenses
“
ZINZINO
FOOD
43% of total sales
Total sales: SEK 16,784 thousand
38,696
5,727
44,423
-36,806
7,617
MANU REKOLA – FINLAND
Independent Zinzino distributor since 2011
ZINZINO
COFFEE
57% of total sales
Total sales: SEK 21,913 thousand
“
Net sales
The Finnish sales network is committed, energetic and focused.
1,661 new distributors and 9,889 new customers and 2013
are proof of this. Zinzino's management is working actively
with sales network training and effective customer support to
reduce the somewhat high percentage of product return.
Life in the direct selling industry is very positive. You have less financial risk, and the work
is more efficient because the company provides IT, customer service, logistics, etc. As an
independent distributor, I can focus on sales and training. In 2013, my team managed to
increase our customer base by 70%, representing over 11,000 customers. We have placed
great emphasis on training, which has improved the quality of sales. Our target in Finland is
to increase the customer base by 100% and the year has started well. We are expanding into
new market areas in Finland and will cover almost all of Finland by the end of 2014.
Zinzino Annual Report
15
ICELAND
Zinzino began selling on the Icelandic market in 2008
(via export) and founded the subsidiary Zinzino Ehf in
2011. During its first year on the Icelandic market, Zinzino
experienced modest growth and sales, with profitability that
was virtually non-existent. With the launch of Zinzino Food,
there was a drastic change and the Icelandic sales network saw
a huge, positive response on the Icelandic market. In 2013,
growth was 220% compared with the previous year and the
country accounted for 8% of the Group's total sales. In total,
1,159 new distributors and 4,102 new customers were added
during the year. The number of new customers represents 1.3%
of Iceland's total population. The significant increase in the
number of customers and sellers in conjunction with the launch
of Zinzino Food also contributed to a major boost in sales of
espresso machines and coffee on the market.
SEK THOUSAND
220%
Percentage of Zinzino's total sales
Net sales
Other revenue
Total income
Total direct costs
Earnings before operating expenses
8%
65% of total sales
Total sales: SEK 11,013 thousand
17,358
1,807
19,164
-18,257
908
ZINZINO
COFFEE
35% of total sales
Total sales: SEK 6,345 thousand
“
Growth compared to previous year
ZINZINO
FOOD
GUÐRUN BRYNJULFSDÓTTIR & ÁSGEIR HALDORSSON – ICELAND
Independent Zinzino distributors since 2008
During the year, we have put in a lot of work and had a lot of fun. This has led to incredible
results – growth has been phenomenal! It's amazing to work with our best friends and
family while enjoying life together. We are very proud to be a part of Zinzino and look
forward to another fantastic year!
Zinzino Annual Report
16
ESTONIA
The Estonian subsidiary Zinzino OÜ was founded in 2013.
Since its founding, Zinzino OÜ has been the strongest of
Zinzino's Baltic companies and in 2013 had good growth of
67% compared with the previous year. In 2013, the company
accounted for 11% of the Group's total sales. In total, 1,801
new distributors and 6,161 new customers were added during
the year. Estonia has a strong and structured sales network that
also runs its own café in Tallinn. There, they meet potential
new customers and distributors and offer them a cup of their
delicious espresso. On the Estonian market, it is still the Zinzino
Coffee product line that accounts for the largest share of sales.
Even though Zinzino Food has better margins compared with
Zinzino Coffee, Zinzino OÜ contributes a strong profit before
operating expenses.
SEK THOUSAND
Growth compared to previous year
67%
Percentage of Zinzino's total sales
11%
Other revenue
Total income
Total direct costs
Earnings before operating expenses
20% of total sales
Total sales: SEK 5,403 thousand
26,574
2,160
28,735
-23,931
4,804
VIKTOR JASSKA – ESTONIA
Independent Zinzino distributor since 2011
ZINZINO
COFFEE
“
Net sales
ZINZINO
FOOD
80% of total sales
Total sales: SEK 21,171 thousand
Zinzino has changed my life in an incredibly positive way. I simply love working with Zinzino!
There was very strong growth in 2013 and it's great that sales of Balance products are going
so well. My goal for 2014 is to continue the trend on the home market and expand my team
to international markets.
Zinzino Annual Report
17
LITHUANIA
In Lithuania, the subsidiary Zinzino UAB was founded in
2010. The company showed strong growth in 2013, with
159% compared with the previous year. In total, the sales
account for 5% of the Group's total income. 847 new distributors and 4,382 new customers were added during the
year. Zinzino has a stable network of sellers in Lithuania.
Even though Zinzino's premium products are regarded as
high priced relative to the average income in the country,
the market continues to show strong growth. Like other
Baltic countries, the Zinzino Coffee product line stills sells
more than the Zinzino Food line.
SEK THOUSAND
Percentage of Zinzino's total sales
Net sales
Other revenue
Total income
Total direct costs
Earnings before operating expenses
159%
5%
Total sales: SEK 3,510 thousand
642
13,073
-12,455
619
JONAS LAPINSKAS – LITHUANIA
Independent Zinzino distributor since 2011
28% of total sales
12,431
ZINZINO
COFFEE
“
Growth compared to previous year
ZINZINO
FOOD
72% of total sales
Total sales: SEK 8,921 thousand
I had been a business owner in the construction industry for 15 years, but my life has only
changed for the better since I chose to work with Zinzino. My organisation in the Lithuanian
market has enjoyed stable growth of over 50% for the three years I have been in business. In
2014, I expect even more growth and I look forward to helping others in Lithuania and other
countries to start up sustainable businesses with Zinzino.
Zinzino Annual Report
18
LATVIA
Zinzino SIA in Latvia is the latest European addition to
the Zinzino Group. The company was founded in spring
2012. Zinzino SIA showed strong growth of 176% in 2013
compared with the previous year and accounts for 5% of
the Group's total sales. 535 new distributors and 2,742
new customers were added on the market in 2013.
As with the other Baltic markets, Zinzino Coffee remains
the dominate product line. The Latvian sales network is
extremely structured. They do a great job of selling the
relatively high-priced premium products in a country with
a lower average income than in the Nordic countries.
SEK THOUSAND
176%
Percentage of Zinzino's total sales
Net sales
5%
Other revenue
Total income
Total direct costs
22% of total sales
Total sales: SEK 2,328 thousand
10,641
868
11,509
-10,832
Earnings before operating expenses
677
ZINZINO
COFFEE
“
Growth compared to previous year
ZINZINO
FOOD
78% of total sales
Total sales: SEK 8,314 thousand
ELĪNA VIŠA OCH IVARS VIŠS – LATVIA
Independent Zinzino distributors since 2012
Being an independent Zinzino distributor means freedom and the opportunity to change
our own lives and our friends' lives for the better. We are proud to work with Zinzino's
amazing products. It is fun, challenging and a learning experience. During the year, we
doubled our number of customers. Sales are going well, but the market of 2 million
inhabitants is still unsaturated. This means we have huge potential in Latvia.
Zinzino Annual Report
19
NEW MARKET
USA
SUCCESSFUL START OF SALES
Zinzino Food launched its sales in the USA in early December 2013 with the products
BalanceTest, BalanceOil and BalanceShake. To date, sales have already spread to
26 states, indicating great potential for continued geographic expansion and strong
sales. The market was officially opened on 8 February 2014. This was celebrated
with a “Launch Celebration Day” in Atlanta, Georgia. Approximately 200 enthusiastic
American and European independent sellers were on hand to celebrate the opening,
along with representatives from the company.
OFFICE IN FLORIDA
Zinzino has established both a sales office and a warehouse in the USA to be able
to offer the market the best possible service and to handle the rapid growth that is
already clearly evident. The sales office is located in Jupiter, Florida, where Zinzino's
employees are well equipped to provide customer service and support to our
American customers and independent sellers. At present, the office has two
members of support staff and one chief operating officer.
Zinzino Annual Report
20
WHAT IS
DIRECT SELLING?
“Membership in Direkthandels
Förening is a seal of quality for
Zinzino as a company”
PERSONAL CONTACT
Direct selling is all about personal contact outside the more traditional
sales settings, such as stores. Perhaps the most common form of direct
selling takes place via so-called home parties, in which the direct seller
either invites the potential customer into their home or makes a visit
to the customer so that the customer can try out their products.
At Zinzino, direct sellers are called “independent partners”. In addition
to recommending the product to potential customers, a partner in
Zinzino can also build up their own sales organisation along with other
direct sellers and thus build up their own business.
For entrepreneurs, Zinzino also offers an exciting business opportunity
centred on sales, marketing and personal development. Training in
this work is organised by the network of independent partners in
collaboration with the company. Zinzino also wants the independent
partners who decide to accept this business offer to feel that they
are working in a vibrant, friendly network where they are well cared
for and receive support and guidance from experienced independent
partners. The private network is the backbone of this type of business,
but the Zinzino company is always behind it, providing support and
driving it forward.
Independent partners benefit from an established brand, advanced
products and a system for training and marketing along with other
independent partners in the network. The company gets dedicated
marketers and our independent partners gain access to exclusive
products of very high quality without needing to purchase large
inventories. Zinzino offers business opportunities for different
people with different lifestyles at different stages of their life. Zinzino
independent partners enjoy great flexibility and choose their own
working hours and intensity. Zinzino supplies the tools and the
opportunities for independent partners to create their own success
according to personal ambitions, lifestyle and goals. The possibilities
are endless!
Zinzino Annual Report
ZINZINO – PROUD MEMBERS OF DIREKTHANDELNS
FÖRENING (DF)
Zinzino is a member of the Swedish national trade association of direct
selling companies, Direkthandelns Förening (DF), and has worked
actively for an open and honest direct selling industry for many years.
Zinzino is a member of the national trade association of direct selling
companies in Sweden, Norway, Finland, Denmark, Estonia, Latvia,
Lithuania and the USA. Zinzino will apply for membership in trade
association of direct selling companies in all new markets it enters.
As one of few direct selling companies, Zinzino works with both
traditional customer structures and with a sales network of
independent partners who are interested in the business opportunities
Zinzino offers. Zinzino stands for personal, close contacts between
sellers and customers, and continually assesses and improves its
offering to meet customer demands. Quality and fairness are at the
heart of all Zinzino products.
Membership in Direkthandels Förening (DF) is a seal of quality for
Zinzino as a company. DF's primary task is to protect the consumer, to
promote good business practices, and to foster a good reputation for
direct selling as a distribution medium and for its practitioners. They
also work to promote awareness and application of sector codes of
conduct, and to ensure that sellers and distributors are well trained.
DF is the consultative body for all legislation that affects direct selling.
DIRECT SELLING ACCOUNTS FOR BILLIONS IN SALES
The direct selling sector is strong both in Sweden and worldwide.
Industry revenue in Sweden reached approximately SEK 3 billion in 2009
and has grown steadily since. DF is a member of FEDSA, the Federation
of European Direct Selling Associations. EDSA represents 25 European
national direct selling associations and – directly or indirectly –
through its associated corporate members, more than 1,000 direct
selling companies with a total annual revenue of more than EUR
20 billion and with more than seven million direct sellers. Of these,
nearly six million are women. Global industry revenue in 2011 was as
much as USD 153,727 million with over 91 million active direct sellers.
21
HEAD OFFICE IN GOTHENBURG
A stimulating workplace
The head office is located in Västra Frölunda outside of Gothenburg,
Sweden. The bright and pleasant office on Hulda Lindgrens Gata is a
hub of activity. Here, all of the employees work in different areas to
together deliver the absolute best to our customers and sellers.
It is a living work environment where every day is unique – a result
of the company's booming growth.
It is exciting to work at Zinzino's head office. It is a young, expansive
and dynamic workplace that provides great space for fun challenges
and personal development. Each employee is important, and we
all help one another to continually maintain the high quality that
permeates throughout our business.
The office is currently home to about 50 employees and we have
increased the number of employees by over 300 % in recent years.
The average age of the employees is currently 33. In spring 2013,
we outgrew the office space that we moved to in the winter of
2010 and therefore expanded to additional workspace one floor up.
In August 2013, part of our staff moved up to the new workspace.
The new workspace is at the top of the building and has windows
facing two directions, making it very bright. In addition to the office
space, it has a small kitchen, a handy conference room, and a “chat
room” big enough for two.
The head office is home to management and operational functions.
Our biggest department is Support and Customer Service, which
answers questions and provides support to our sellers and
customers daily by phone and e-mail. The languages of each and
every one of our markets is represented in Zinzino's Support and
Customer Service, ensuring that we can always assist customers and
sellers in the best possible manner. Our diverse origins also help
create a very rewarding and interesting environment for colleagues
to socialise and learn from each other's experiences and knowledge.
“
“
Zinzino's head office is a fun workplace where my skills in language
and communication are constantly evolving. It has an international
environment with challenges and a fast pace that fills my days with
a lot of adventure. Being part of Zinzino's journey is a huge honour
for me.
- Greta Simaityte, Lithuanian Support and Customer Service worker
Support and Customer Service is the department most affected by
growth. This has led to steady growth in the number of Support and
Customer Service workers during the year. We also strengthened
our Sales, Accounting and Marketing departments. We expect to
continue hiring more employees as we expand into new markets
in 2014.
External provider of warehousing and logistics
To handle the increased sales volumes, Zinzino has phased out its
own house operations, which were previously handled in the same
building. In July 2013, a cooperation began with an external provider
who now handles both warehousing and logistics from its premises
in Trollhättan, Sweden. We are very pleased with this cooperation,
which is an important move for us to be able continue expanding
at the pace we want.
Zinzino Annual Report
22
BOARD OF DIRECTORS
Hans Jacobsson
Cecilia Halldner
Staffan Hillberg
Björn Flintberg
Born: 1967
Chairman
Born: 1951
Board Member
Born: 1964
Board Member
Born: 1972
Board Member
MBA. CEO of Rootfruit Scandinavia
AB. Formerly served as as Finance
and Supply Chain Director for General
Mills Scandinavia AB, Partner in CRT
Ventures (venture capital company in
Buresfären) and Investment Manager
in Investment AB Bure.
MBA. Cecilia has extensive experience in business development and
launches for international corporate brands on the Nordic market,
including Astra Zeneca, Beiersdorf,
Ecco and BeO.
Studied Electrical Engineering at
Chalmers University of Technology
and has an MBA from INSEAD. CEO
of Wood Hill Investment AB and CEO
of portfolio company Heliospectra
AB. Has extensive experience from
international operational positions
and from the financial sector.
B.A. in History with PolSci,
Georgia College & State University.
Serial entrepreneur in the IT sector.
Has extensive experience in mergers
and acquisitions, IPOs and structural
transactions. Also has extensive expertise in food and consumer products.
Hans Jacobsson has been a member of
the Board of Directors since 2007 and
has served as Chairman since 2009.
Number of shares: 424,215 B-shares
and 45,000 options, privately and
through the company
Cecilia also has many years of
experience in operational management, including serving as CEO
of the Orkla Group, and in entrepreneurship as CEO of European
Last Minute Ticket AB, a mobile
marketing company. Is currently
Regional Manager for Sensus Study
Association in the Östergötland/
Norra Småland region. Cecilia
Halldner has been a member of
the Board of Directors since 2007.
Number of shares: 30,000
B-shares
Formerly CEO of Yield AB and
Scandinavian Financial Management
AB, formerly Managing Partner
in MVI, partner in CRT Ventures
AB (venture capital company in
Buresfären), CEO of AppGate AB,
CEO of Bonnier Online, Head of
Bonnier Medialab, Product Manager
for Apple Computer Inc. in France
and the USA.
Formerly Marketing Manager at
Seven Nox AB (now Zinzino Nordic
AB). Has worked in marketing and
communications in the IT sector
and training sector for a number
of years. Has extensive experience
in business development at both
management and production levels.
Also has in-depth expertise and
understanding of network sales.
Björn Flintberg has been a member
of the Board of Directors since 2009.
Number of shares: 32,500 B-shares
Staffan Hillberg has been a member
of the Board of Directors since 2007.
Number of shares: 250,000 B-shares
and 45,000 options
Zinzino Annual Report
23
MANAGEMENT
DAG BERGHEIM PETTERSEN
CEO
Born: 1970
Senior positions at El-giganten and Alcatel, and served as
Senior Vice President of TeliaSonera subsidiary NetCom.
Dag has extensive experience in strategic leadership in growth companies
and has served as CEO of Zinzino since 2012.
NUMBER OF SHARES: 180,000 B-shares + 1,460,000 call options
Henrik Schultz
DIRECTOR OF PRODUCTS &
LOGISTICS
CARIN ANDERSSON
CHIEF OPERATING OFFICER
EUROPE
Born: 1961
Born: 1975
Henrik Schultz has extensive
experience in senior positions at a
number of different international and
commercial companies.
Carin Andersson has solid, extensive
experience in the direct selling sector
and customer service spanning
13 years, providing her with great
expertise in assisting customers and
sellers in sector-related issues.
He has an MBA and has held positions
such as Sales Manager, Marketing
Manager and CEO. Henrik joined
Zinzino in 2007 from Libro Gruppen AB.
NUMBER OF SHARES: 10,000 B-shares +
30,000 call options
FREDRIK NIELSEN
CFO
She joined Zinzino in 2004, having
previously worked at PGOne AB,
which has since been acquired by
the Zinzino Group.
JAKOB SPIJKER
BUSINESS DEVELOPMENT
BORN: 1968
Fredrik Nielsen holds an MBA and has
vast experience in senior positions in
financial management. Came to Zinzino
in 2009, and before that he was CFO for
Gymnasium AB.
Jakob Spijker has held various positions
in logistics, transport and warehousing,
both in Sweden and in the Netherlands.
Came to Zinzino in 2012. Before this,
he was Head of Logistics at Mediatec
Solutions AB.
Zinzino Annual Report
Born: 1953
Michael Perry has extensive experience
in senior positions at a number of
different companies. He has an MBA
and has served in positions such as
Sales Manager, Chief Operating Officer
and CEO. He has vast experience with
direct selling. Michael joined Zinzino
LLC in March 2013 as COO for the
American market.
Number of shares: 0
NUMBER OF SHARES: 21,082 B-shares
BORN: 1977
NUMBER OF SHARES: 30,000 call options
MICHAEL PERRY
CHIEF OPERATING OFFICER USA
NUMBER OF SHARES: 0 shares
MIKAELA WAHLBRO
MARKETING AND
COMMUNICATIONS MANAGER
BORN: 1984
Mikaela Wahlbro holds a B.A. in Media
and Communications from Karlstad
University and has also completed
studies at Halmstad University and
Stockholm University. Mikaela has
been employed at Zinzino since 2010.
NUMBER OF SHARES: 0 shares
24
ZINZINO SMOOTHIE MAKER
Mix your own great-tasting smoothies using BalanceOil
or BalanceShake together with your favourite ingredients!
Zinzino Annual Report
25
FINANCIAL
INFORMATION
Zinzino Annual Report
18
26
DIRECTORS' REPORT
The Board of Directors and CEO of Zinzino AB, 556733-1045, hereby submit this Annual Report and consolidated financial
statements for financial year 1 January 2013 to 31 December 2013.
OWNERSHIP AND HISTORY
EVENTS DURING THE YEAR
Business activities commenced in autumn 2007. The principal
activity of the business is to own and develop companies in
direct marketing and related businesses.
Establishment in the USA
In 2013, Zinzino established a limited liability company (LLC) in
the USA.
In 2009, Zinzino Nordic AB was acquired through both a directed
issue in kind to shareholders in Zinzino Nordic AB and through
the rights issue Zinzino Nordic conducted in December 2009.
This gave Zinzino AB control over 97% of votes and 92% of capital
in Zinzino Nordic AB. As of 31 December 2013, ownership in
Zinzino Nordic totalled 93% of the capital and 97% of the votes.
At an early stage of the establishment process, Zinzino chose
to situate both the sales office and the warehouse in the USA
to offer the market the best possible service and handle growth
quickly. The sales office is located in Jupiter, Florida, where
Zinzino's employees are well equipped to provide customer
service and support to our American customers and independent
sellers. Logistics for the entire country is handled via the same
external partner as in Europe, with the warehouse located in
Norfolk, Virginia.
In addition to Zinzino Nordic AB, the following wholly-owned
companies are part of the Group: Zinzino OÜ in Estonia, Zinzino
UAB in Lithuania, SIA Zinzino in Latvia, Zinzino Ehf in Iceland,
and the company established in 2013, Zinzino LLC in Jupiter,
Florida, USA.
In addition to this, Zinzino Nordic owns 100% of the companies
Zinzino Sverige AB, Zinzino OY (Finland), Zinzino AS (Norway)
and Zinzino ApS (Denmark), as well as the dormant Swedish
subsidiaries PG Two AB, Poxian AB and 2Think AB.
INFORMATION ON GROUP OPERATIONS
Net sales for the Group totalled SEK 226.3 (161.7) million, with
earnings after financial items totalling SEK 10.4 (5.3) million.
This represents revenue growth of 40% and a 95% improvement
in profit.
Net sales are spread over two product lines – Zinzino Food
and Zinzino Coffee. In 2013, sales of Zinzino Coffee were SEK
140.9 million and sales of Zinzino Food were SEK 85.4 million.
Zinzino is a sales company that uses independent distributors
who market and sell products via commission through direct
selling. In 2013, Zinzino signed contracts with 10,363 (9,812)
new distributors and 48,190 (26,193) new customers.
The geographic breakdown of sales in 2013 is as follows: Norway
30%, Finland 18%, Denmark 13%, Estonia 11%, Sweden 10%,
Iceland 8%, Lithuania 5%, Latvia 5 % and the USA 0.2%. Sales
growth per market in 2013 compared with previous year: Iceland
220%., Latvia 176%, Lithuania 159%, Estonia 67%, Finland 41%,
Denmark 26%, Norway 21%, Sweden 2%.
Market analysis shows that Norway remains the strongest
market, with total income of SEK 77.6 (62.1) million. The fastest
growing, not counting the newly founded USA, is Iceland with
SEK 19.2 (6.0) in sales and Latvia with SEK 11.5 (4.3) million in
sales. Sweden had sales of SEK 25.5 (23.8) million, Denmark
SEK 34.0 (25.8) million, Finland SEK 44.4 (31.0) million, Estonia
SEK 28.7 (17.1) million and Lithuania SEK 13.1 (4.9) million.
During the last month of the year, sales in the USA totalled
SEK 0.5 million.
Zinzino Annual Report
Zinzino Food launched its sales in the USA in early December
with the products BalanceTest, BalanceOil and BalanceShake.
By year-end, sales had spread to 23 states, indicating great
potential for continued geographic expansion and strong sales.
In the first stage of establishment on the American market, Zinzino
has chosen to focus on sales of the Zinzino Food product line.
No decision has been made as yet regarding when the Zinzino
Coffee product line will be launched on the American market.
Transition to external logistics partner
In 2013, Zinzino phased out its own warehouse operations
and transitioned to an external logistics partner. This makes it
possible to continue managing a high growth rate. The transition
made it possible to increase capacity on short notice, which
facilitates Zinzino's expansion. The transition process was
extensive and required significant investments in appropriate IT
technology. Logistics is running smoothly and Zinzino continues
to reap huge benefits from the solution.
Zinzino Food in focus
During the year, Zinzino put major focus on the new product line,
Zinzino Food. Together with partly-owned Bioactive Foods AS,
the company worked actively with product development. As a
result, Zinzino BalanceOil with vanilla flavour and BalanceShake
were launched during the year. In the Zinzino Food product line,
BalanceOil is the clear top seller on most of Zinzino's markets.
BalanceShake includes BalanceOil in powder form. BalanceShake
has been a strong contributor to sales growth in markets such
as Iceland, which has grown to become Zinzino's third-largest
market. Zinzino has also launched accessories in the product line,
such as the Zinzino Smoothie Maker and Zinzino Shake Bottle.
When 2013 is summed up, sales of the product line amount to
SEK 85.4 million, representing 38% of total product sales. During
the fourth quarter, Zinzino Food accounted for 50% of net sales.
This trend continues in early 2014.
In terms of earnings, the new product line increased gross profit
in the company as the margins for Zinzino Food products are
generally better than those of Zinzino Coffee. In 2013, Zinzino's
total gross profit margin increased from 24% to 28%.
27
Sales of Zinzino Coffee remain stable
Zinzino's home café concept, which previously was the Group's
only product line, has been known as “Zinzino Coffee” since
late 2012.
The main products of the product line are quality espresso
machines and associated espresso pods. Together with the
other Zinzino Coffee products, such as milk frothers and
confectionery, the customer can create a café experience right
in his/her own kitchen.
Today, Zinzino offers its customers seven different espresso
machines in different price ranges and 25 different varieties
of coffee and tea. The range also includes several Fairtradelabelled products, such as coffee, tea and sugar. The secret to
Zinzino Coffee's success is both quality products and the unique
concept of enabling customers to take out a coffee subscription.
When a customer takes out a subscription, he/she can purchase
an espresso machine at a discount price. The coffee is simply
and conveniently delivered to the customer's home every
other month.
The stable growth in Zinzino Coffee will be maintained by
continuously improving and developing the products and the
range, and by continuing to build the Zinzino brand on the home
café market. The continued increasing trend of home café in
combination with Zinzino's concept creates opportunities to win
significant market shares within the segment.
Customer in focus
In 2013, Zinzino maintained a strong focus on increasing
customer satisfaction. Further initiatives have been implemented
in the company's customer and sales support, through efforts
such as increasing the number of employees in the relevant
departments, and implementation of a new telephone system.
This has resulted in a high level of service, which has generated
more active customers and reduced the number of customers
lost. The seller's bonus system also underwent an overhaul with
the aim of generating more customers. The impact has been
positive and the number of active customers is increasing steadily.
BUSINESS MODEL AND MARKETING
STRATEGY
The core of Zinzino's business is marketing and sales. The
company's network of independent sellers and sales teams
markets the products and services to the consumer, while much of
the company's own marketing is directed at developing attractive
offers to customers and offering sellers the information and
knowledge they need to be able to do their job out in the field.
Marketing consists primarily of providing product information,
promotional materials, basic training materials and an effective
flow of information via the web, social media and e-mail.
Company management maintains an active dialogue with the
“leader council” made up of representatives from the sales
network. This has proven to be highly appreciated and the
dialogue is considered a recipe for success.
Zinzino's Product and Sales department works continually with
new and exciting projects in collaboration with the Rombouts
& Malongo and BioActive Foods product development team.
Zinzino Annual Report
By keeping product development at the forefront, Zinzino
strengthens its position.
ORGANIZATION AND EFFICIENCY
Zinzino has continued efforts to streamline its business systems
and procedures to better handle the increased sales in a stable
and satisfactory manner.
The organisation has been strengthened with additional
resources in practically all departments at the head office in
Gothenburg. 2013 also saw the opening of a local sales office
in Florida, USA, where Zinzino hired a COO for the American
market and two support workers.
As previously mentioned, Zinzino phased out its own
warehousing during the year and has transitioned to an external
logistics partner as part of its efforts to streamline future growth.
Complaint and return management remains an internal process
in the company.
FINANCIAL POSITION
By the end of 2013, the Group had equity of SEK 21.6 (12.4)
million, liquid assets of SEK 10.9 (16.5) million and an equity/
assets ratio of 38% (26%). Capital tied up in inventory increased
to SEK 28.4 (15.4) million. The increase is due to a seasonal
increase in inventory of finished products of our own brand at
Zinzino Food's supplier in connection with the launch of new
products. Another contributing factor is entry into the American
market with a local warehouse. The increase is considered
temporary and the normal inventory level at the current size is
estimated at about SEK 20 million. Most of the surplus inventory
of espresso-related products was sold out during the year.
The equity of the parent company Zinzino AB was SEK 21.5
million, representing an equity/assets ratio of 96%. Zinzino has
a favourable tax situation with unutilised loss carry forward in
the companies Zinzino Nordic AB and Zinzino AB in excess of
SEK 100 million. Deferred tax assets have not been reported.
RISKS AND EXTERNAL FACTORS AFFECTING
GROWTH IN ZINZINO
The Board continually discusses external risks for Zinzino's
expansion. The greatest risks remain in the organisation's ability
to manage costs during strong growth.
The planning of purchases is a challenge during rapid expansion.
Management is therefore actively working with purchase
forecasts and inventory optimisation to meet the challenge
effectively and avoid tying up capital in inventory unnecessarily.
The prioritisation of IT resources is another challenge for Zinzino
when the growth rate is high. The company is working actively
to optimise and distribute resources in the best way possible.
The ability to recruit the right personnel on short notice is also
important.
Innovations and product developments from competitors also
pose risks for Zinzino. The Board believes, however, that access
to the Rombouts & Malongo product range, as well as the new
Zinzino Food/Balance product line enables the company to
remain very competitive.
28
FUTURE FINANCIAL TARGETS
The Zinzino Board of Directors hereby presents the financial targets and key
figures the company intends to achieve in coming years:
During the period 2014-2016, average sales growth shall be
at least 25% and the net margin shall increase to > 6%.
The dividend policy shall be 30% of net income, provided
that liquidity and financial strength permit this.
For 2014, we forecast that net sales shall exceed
SEK 290 million, representing growth of at least 28%.
The net margin is expected to exceed 4% in 2014.
Zinzino Annual Report
29
&
OWNERSHIP SHARE
PERFORMANCE
Since 20 September 2010, Zinzino AB has been listed on the Aktietorget stock exchange. In 2013, 4,583,656 (8,032,473)
shares were traded, distributed over 3,674 (6,670) trades. The company currently has 969 (1,003) owners, excluding
foreign custody account holders, distributed over 27,082,770 shares.
SHARE CAPITAL
Of the company's 27,082,770 total shares, 6,113,392 are A-shares. Only B-shares are listed for trade on the Aktietorget
market, under ISIN code SE0002480442.
Largest shareholdings as of 31 December 2013:
Owner
No. of A-shares
No. of B-shares
Percentage of votes
Percentage of capital
Örjan Saele via company
and family
4,123,397
4,712,761
55.96%
32.63%
Peter Sörensen via company
1,809,995
2,019,805
24.51%
14.14%
180,000
14,236,812
19.53%
53.23%
6,113,392
20,969,378
100.00%
100.00%
Share
Share
2013
2012
Örjan Saele
ZZ A
ZZ A
4,123,391
4,123,391
Örjan Saele
ZZ B
ZZ B
4,712,761
4,615,596
Staffan Hillberg
ZZ B
ZZ B
234,656
250,000
Staffan Hillberg
ZZ KO
ZZ KO
45,000
45,000
Hans Jacobsson
ZZ B
ZZ B
424,215
406,900
Hans Jacobsson
ZZ KO
ZZ KO
45,000
45,000
Henrik Schultz
ZZ B
ZZ B
10,000
10,000
Henrik Schultz
ZZ KO
ZZ KO
30,000
30,000
Cecilia Halldner
ZZ B
ZZ B
30,000
30,000
Carin Andersson
ZZ B
ZZ B
21,082
21,082
Björn Flintberg
ZZ B
ZZ B
32,500
32,500
Dag Pettersen
ZZ B
ZZ B
180,000
180,000
Dag Pettersen
ZZ KO
ZZ KO
1,460,000
1,460,000
Fredrik Nielsen
ZZ KO
ZZ KO
30,000
30,000
Other shareholders
Total
Reported insider holders at year-end:
Name
Zinzino Annual Report
30
SHARE PRICE DEVELOPMENT SINCE START OF TRADING
In 2013, a total of 4,583,656 shares were traded in 3,674 trades.
The first trade of the year was at SEK 6.70 and the last at SEK 6.40.
The year's peak was on 16 January 2013 with a trade at SEK 10.10. The low of SEK 5.00 came on 19 April 2013.
An average of 1,247 shares were traded per trade at an average price of SEK 7.25.
OPTION PLAN
Zinzino has issued warrants on two occasions:
At the end of 2012, Zinzino implemented an option plan in which 2,100,000 warrants were issued to key people in
Group management and the sales network. The reason for the deviation from the shareholder's preferential rights was
that the company deemed it important to create lasting incentives for executives considered essential to the company's
future growth. The Board determined that a plan for warrants that did not burden the company's liquidity would be the
most beneficial for the company and the company's shareholders.
Holders of call options after the aforementioned issue are entitled, between 1 August 2012 and 1 November 2016, to
make cash purchases for new shares, each share with a quota value of SEK 0.1 according to a subscription price of SEK 2
per share.
Zinzino has previously issued 2,500,000 options to Partner Rewards AB. Each option gives the holder the right to
subscribe a new share in the company, each share with a quota value of SEK 0.1 under a subscription price of SEK 5 per
share. Share subscription must take place between 1 August 2010 and 1 December 2014. The intention with the option
plan is to give the owners of Partner Rewards AB a tool to reward successful sellers in the Zinzino sales network both
inside and outside of Sweden. The share subscription period is 1 August 2010 to 1 December 2014. Partner Rewards is
a company under the control of Örjan Saeles.
Zinzino Annual Report
31
RESULTS AND FINANCIAL POSITION
Parent company
Group
Amounts in SEK thousand
2013
2012
2013
2012
226,308
161,651
0
0
Total income
254,531
177,164
0
0
Profit/loss after financial items
10,377
5,317
-621
-693
Operating margin
4.1%
2.9%
neg
neg
Profit margin
3.5%
2.6%
neg
neg
Return on equity
41.8%
37.10%
neg
neg
Balance sheet total
56,807
47,423
22,465
22,632
Equity/assets ratio
38.0%
26.11%
95.6%
97.8%
Net sales
DEFINITIONS OF KEY FIGURES:
Operating margin
Operating profit or loss/Total income
Profit margin
Net income/Total income
Return on equity
Net income/Equity
Equity/assets ratio
Equity/Balance sheet total
PROPOSED ALLOCATION OF PROFITS (SEK)
The Annual General Meeting has the following at its disposal:
Zinzino AB
Retained earnings
Profit/loss for the year
Total equity
SEK
19,423,699
-621,122
18,802,577
The Board proposes that the retained earnings
be utilised as follows:
SEK
SEK 0.10 per share distributed
to the shareholders
2,708,277
Carried forward
16,094,300
Total
18,802,577
The Board believes that the proposed dividend will not prevent the company from meeting its obligations in the short
and long term, or prevent it from making necessary investments. The proposed divided can thereby be justified with
reference to that which is stated in Chapter 17 Section 3 § 2-3 of the Companies Act (precautionary principle).
Regarding the company's reported results for the accounts, the status per closing day, financing and capital management
during the year, refer to the accompanying financial statements.
Zinzino Annual Report
32
INCOME STATEMENT
Amounts in SEK thousand
Parent company
Group
TYPE OF COST
Note
Net sales
1, 2
Other revenue
3
Total income
1 Jan 2013
1 Jan 2012
1 Jan 2013
1 Jan 2012
31 Dec 2013
31 Dec 2012
31 Dec 2013
31 Dec 2012
226,308
161,651
28,222
15,513
254,531
177,164
0
0
Operating expenses
Merchandise
2
-69,999
-57,028
-
-
-113,577
-77,381
-
-
4, 5
-35,166
-16,917
-621
-736
Direct costs relating to goods sold
Other external expenses
Personnel costs
6
-23,556
-19,384
-
-
Depreciation/amortisation
7
-735
-397
-
-
Other operating expenses
3
-1,028
-792
-
-
-244,060
-171,899
-621
-736
10,470
5,265
-621
-736
46
76
-
44
2
-
-
-1
-141
-24
-
-
-93
52
0
43
PROFIT/LOSS AFTER FINANCIAL ITEMS
10,377
5,317
-621
-693
PROFIT/LOSS BEFORE TAX
10,377
5,317
-621
-693
-554
-351
-
-
-796
-366
9,027
4,600
-621
-693
Total expenses
OPERATING PROFIT/LOSS
Profit/loss from financial investments
Interest income
Other financial income
Interest expenses
Total financial items
Tax on profit/loss for the year
Minority interest in profit/loss for the year
PROFIT/LOSS FOR THE YEAR
Zinzino Annual Report
8
33
BALANCE SHEET
Parent company
Group
Amounts in SEK thousand
Note
31 Dec 2013
31 Dec 2012
31 Dec 2013
31 Dec 2012
9
3,498
2,450
-
-
3,498
2,450
-
-
977
843
-
-
977
843
-
-
3,616
3,606
3,617
3,606
-
-
18,768
18,512
Total financial assets
3,616
3,606
22,385
22,118
TOTAL FIXED ASSETS
8,091
6,899
22,385
22,118
24,638
14,044
-
-
3,777
1,363
-
-
28,415
15,407
-
-
683
241
-
-
-
-
-
384
3,047
1,051
15
24
5,042
6,564
-
38
ASSETS
FIXED ASSETS
Intangible assets
Intangible assets
Total intangible assets
Tangible assets
Equipment, tools and installations
10
Total tangible assets
Financial assets
Other investments held as fixed assets
Shares in subsidiaries
11
CURRENT ASSETS
Inventories, etc.
Finished goods and merchandise
Advances to suppliers
Total inventories
Current receivables
Accounts receivable
Receivables from Group companies
Other receivables
Prepaid expenses and accrued income
Tax assets
12
605
788
-
-
Total current receivables
9,377
8,644
15
446
Cash and bank balances
10,923
16,473
65
68
TOTAL CURRENT ASSETS
48,716
40,524
80
514
56,807
47,423
22,465
22,632
TOTAL ASSETS
Zinzino Annual Report
34
BALANCE SHEET
Amounts in SEK thousand
Note
EQUITY
13
Group
31 Dec 2013 31 Dec 2012
Parent company
31 Dec 2013 31 Dec 2012
Restricted equity
Share capital
2,708
2,708
2,708
2,708
-
-
2,708
2,708
Unrestricted reserves/retained earnings
9,878
5,076
19,424
20,117
Profit/loss for the year
9,027
4,600
-621
-693
-
-
18,803
19,424
21,613
12,384
21,511
22,132
Minority interest
1,268
472
-
-
TOTAL MINORITY INTEREST
1,268
472
-
-
Other long-term liabilities
277
277
277
277
Total long-term liabilities
277
277
277
277
6,208
11,559
20
-
-
-
582
25
Total restricted equity
Retained earnings
Total retained earnings/accumulated loss
TOTAL EQUITY
MINORITY INTEREST
LIABILITIES
Long-term liabilities
Current liabilities
Accounts payable
Liabilities to Group companies
Bank overdraft facilities
14
400
-
-
-
Other liabilities
15
18,539
14,475
36
36
Accrued expenses and deferred income
16
8,501
8,256
40
162
Total current liabilities
33,649
34,290
677
223
TOTAL LIABILITIES
34,926
34,567
954
500
56,807
47,423
22,465
22,632
TOTAL EQUITY, MINORITY AND LIABILITIES
Pledged assets
Contingent liabilities
Zinzino Annual Report
17
6,500
3,400
NONE
3,000
NONE
NONE
NONE
NONE
35
CASH FLOW STATEMENT
Group
Amounts in SEK thousand
1 Jan 2013
Parent company
1 Jan 2012
1 Jan 2013
1 Jan 2012
31 Dec 2013 31 Dec 2012
31 Dec 2013
31 Dec 2012
Operating activities
Operating profit
10,470
5,265
-621
-736
735
397
-
-
11,205
5,662
-621
-736
48
76
-
44
Interest paid
-141
-24
-
-
Income tax paid
-554
-351
-
-
10,558
5,363
-621
-692
-13,008
-10,301
-
-
-809
-6,574
434
-331
Depreciation/amortisation and impairment
Interest received
Cash flow from operating activities
before changes in working capital
Cash flow from changes in working capital
Increase(-) / Decrease(+) of inventories
Increase(-) / Decrease(+) of current receivables
Increase(+) / Decrease(-) of current liabilities
Cash flow from operating activities
-565
20,209
455
-59
-3,824
8,697
268
-1,082
-11
-3,779
-
-3,805
-1,534
-1,310
-271
-
-383
-422
-
-
-1,928
-5,511
-271
-3,805
-
-
-
-
Investment activities
Investments in financial assets
Investments in intangible assets
Investments in tangible assets
Cash flow from investment activities
Financing activities
Shareholder contributions
Group contributions
-
-
-
-
Option issue
0
4
0
4
Cash flow from financing activities
0
4
0
248
CASH FLOW FOR THE YEAR
-5,752
3,190
-3
-4,883
Cash and cash equivalents at the start of the year
16,473
13,322
68
4,951
Exchange rate difference in cash and cash equivalents
-202
39
-
-
Cash and cash equivalents at year-end
10,923
16,473
65
68
Change in cash and cash equivalents
-5,752
3,190
-3
-4,883
Zinzino Annual Report
36
ADDITIONAL INFORMATION
GENERAL INFORMATION
ACCOUNTING AND VALUATION PRINCIPLES
Applied accounting principles are consistent with the Annual Accounts Act and statements and general advice from the Swedish
Accounting Standards Board. When general advice was not available from the Accounting Standards Board, guidance has been
taken from the Swedish Financial Accounting Standards Council recommendations and, in applicable cases, from statements by
FAR. In such cases, this is noted in specific order below. The accounting principles are unchanged from the previous year.
CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements include the parent company, subsidiaries in which the parent company directly or
indirectly owns shares corresponding to 50% of voting rights or through agreements has a controlling interest, and associated
companies in which the parent company owns shares corresponding to at least 20% or in another way has significant influence
without a subsidiary relationship.
These consolidated financial statements have been prepared using the purchase method. This means that a subsidiary's assets
and liabilities are recorded at acquisition value, which formed the basis for the determination of purchase price for the shares.
The difference between purchase price and the acquired company's equity is recorded as goodwill. Group equity includes the
parent company's equity and portions of subsidiary equity arising after the acquisition of these companies.
Translation of foreign subsidiaries' income statements and balance sheets are prepared using the current rate method. This
means that assets and liabilities are translated at the closing rate and that the income statements are translated at average
exchange rates during the financial year. Items recorded under equity are translated to the prevailing rates at the time of
acquisition. Any translation differences are recorded directly in consolidated equity. Inter-company profits are eliminated in full.
REVENUE RECOGNITION
Income from sales of goods and services is recognised at the date of delivery. Net sales comprise sales value less VAT
and discounts.
INTEREST
Interest income is recognised as it is earned.
LEASING
The financial agreements within the Group are reported as operating leases, which means that leasing fees are reported as an
expense in the income statement.
INCOME TAX
The Group's tax expenses or tax income comprise current tax, changes in deferred tax and tax attributable to
share in profits in associated companies.
Current tax is the tax payable on the taxable profit for a period in accordance with tax regulations in each country. Deferred tax
is calculated based on taxable and deductible temporary differences between reported and tax values of assets and liabilities.
Loss allowances are only taken into account to the extent that it is probable that the loss allowance can be utilised in the
foreseeable future.
Valuation of all tax liabilities/assets are measured at nominal amounts and in accordance with applicable tax regulations and
tax rates.
RECEIVABLES
Receivables are recorded at the lowest nominal value and at the amount that is expected to be received. Receivables and
liabilities in foreign currencies are valued at the closing rate. Exchange gains and losses on operating receivables and liabilities
are included in operating profit. Gains and losses on financial receivables and liabilities are reported as financial items.
INVENTORIES
Inventories are valued according to the lowest value principle and FIFO (first in, first out) method. This means that inventories
are stated at acquisition cost under the FIFO method or at fair value, whichever is lower. Deductions for real obsolescence have
been made.
FIXED ASSETS
Fixed assets are valued at acquisition value less accumulated depreciation/amortisation. Depreciation/amortisation is applied
systematically over an asset's expected useful life as listed below:
Equipment, tools and installations
Intangible assets
20% per year
20% per year
CASH FLOW STATEMENT
The cash flow statement is prepared using the indirect method.. The reported cash flow only includes transactions that involve
cash payments.
Zinzino Annual Report
37
NOTES TO INDIVIDUAL ITEMS
Note
1
SEGMENT REPORTING
Segmentation is based on the Group's internal reporting structure, which is based on sales per geographic area.
Sales in the Nordic region comprise approx. 79% of total sales. The Directors' Report specifies the
geographic distribution.
Note
2
PURCHASES AND SALES BETWEEN GROUP COMPANIES
Of the year's sales, SEK 0 (0) thousand concerns sales to other Group companies. Of the year's purchases, SEK 0 (0)
thousand concerns purchases from other Group companies.
Note
3
EXCHANGE RATE DIFFERENCES
Parent company
Group
2013
2012
2013
2012
Exchange rate gains
2,556
772
-
-
Exchange rate losses
-1,028
-917
-
-
Total
1,528
-145
-
-
Note4
LEASING
During the year, the Group entered into two new leasing agreements for vehicles and one agreement for expanded
switchboard services.
Parent company
Group
2013
2012
2013
2012
Due within one year
501
223
-
-
Due within five years
951
572
-
-
1,452
795
-
-
2013
2012
2013
2012
Leasing expenses paid during the year
452
96
-
-
Total
452
96
-
-
Total
Parent company
Group
Zinzino Annual Report
38
Note
5
REMUNERATION TO AUDITORS
Group
Parent company
2013
2012
2013
2012
447
340
40
40
Audit assignment
72
56
-
-
Other services
19
-
Audit assignment
10
10
-
-
Other services
48
48
-
-
42
17
-
-
6
1
626
472
40
40
PricewaterhouseCoopers AB
Audit assignment
PricewaterhouseCoopers AS (NO)
PricewaterhouseCoopers Aps (DK)
PricewaterhouseCoopers Oy (FI)
Audit assignment
PricewaterhouseCoopers Ehf (IS)
Audit work outside of audit assignment
Total
NOTE 6
EMPLOYEES AND PERSONNEL COSTS
Salaries and other remuneration
Salaries and other remuneration
- of which to Board and CEO
- of which bonuses
Parent company
Group
2013
2012
2013
2012
17,541
14,253
-
-
2,697
2,881
*
*
624
870
-
-
5,515
4,769
-
-
- of which to Board and CEO
499
846
-
-
Of which pension costs
946
699
-
-
-
-
-
-
-
-
Social security contributions in accordance with
legislation and contractual agreements
- of which to Board and CEO
Total
23,056
by country
19,005
Group
Salaries and other remuneration, distributed
Parent company
2013
2012
2013
2012
17,016
13,895
-
-
2,238
2,536
-
-
17,016
13,895
-
-
Sweden
Salaries and other remuneration
- of which to Board and CEO
Total for Sweden
Norway
Salaries and other remuneration
459
345
-
-
- of which to Board and CEO
459
345
-
-
Total for Norway
459
345
-
-
52
-
-
-
-
-
-
-
52
-
-
-
15
13
-
-
-
-
-
-
15
13
-
-
17,541
14,253
-
-
USA
Salaries and other remuneration
- of which to Board and CEO
Total for USA
Lithuania
Salaries and other remuneration
- of which to Board and CEO
Total for Lithuania
Total
Zinzino Annual Report
39
*TERMS FOR CEO
The notice period from the company is six months. The notice period from the CEO is six months. Monthly salary
is SEK 139,000 and pension terms are in accordance with general company terms. The CEO's bonus for 2013 was
SEK 624,000. The CEO's salary is paid from Zinzino Nordic AB and Zinzino AS.
Average number of employees
Group
Parent company
2013
2012
2013
2012
Women
38
23
-
-
Men
14
15
-
-
Average number of employees
52
38
-
-
During the year, 453 (445) private individuals in the sales force received remuneration in the form of wages in Sweden.
Due to the fact that Zinzino has no ability to affect the design and scope of their working hours and any remuneration
to them is only paid as commission on the sales they generate, a conversion to the full number of full-time employees
is not possible.
These individuals have been paid SEK 511,000 (683,000) within the Group.
Gender distribution in senior management
Parent company
Group
2013
2012
2013
2012
24
22
4
4
1
1
1
1
23
21
3
3
CEOs
1
1
1
1
- of which women
-
-
-
-
- of which men
1
1
1
1
Other senior executives
6
5
5
5
- of which women
2
2
2
2
- of which men
4
3
3
3
Total number of women
3
3
3
4
Total number of men
28
25
7
6
Total
31
28
10
10
Board members
- of which women
- of which men
Zinzino Annual Report
40
Note
7
DEPRECIATIONS/AMORTISATIONS
Parent company
Group
2013
2012
2013
2012
Intangible assets
486
224
-
-
Equipment
249
173
-
-
Total
735
397
-
-
Note
8
TAX ON PROFIT/LOSS FOR THE YEAR
Parent company
Group
2013
2012
2013
2012
Current tax
554
351
-
-
Total
554
351
-
-
Note
9
INTANGIBLE ASSETS
Group
2013
2012
Opening acquisition value
2,673
Acquisitions during year
Closing acquisition value
Parent company
2013
2012
1,364
-
-
1,534
1,309
-
-
4,207
2,673
-
-
-224
-
-
-
-
-
-
-
Amortisation for the year
-486
-224
-
-
Closing accumulated amortisation
-710
-224
-
-
3,498
2,450
-
-
Opening amortisation value
Divestment for the year
Closing residual value according to plan
Note
10
EQUIPMENT, TOOLS AND INSTALLATIONS
Parent company
Group
2013
2012
2013
2012
2,988
2,566
-
-
Acquisitions during year
383
422
-
-
Divestment for the year
0
0
-
-
Closing accumulated acquisition value
3,371
2,988
-
-
Opening amortisation value
-2,145
-1,972
-
-
0
0
-
-
Opening acquisition value
Divestment for the year
Amortisation for the year
Closing accumulated amortisation
Closing residual value according to plan
Zinzino Annual Report
-249
-173
-
-
-2,394
-2,145
-
-
977
843
-
-
41
Note
11
SHARES IN SUBSIDIARIES
Parent company
Opening acquisition value
Acquisition of shares in Zinzino Nordic
Acquisition of Zinzino UAB
Closing book value
Name of subsidiary
2013
2012
18,512
18,313
257
173
-
26
18,768
18,512
Shares
in %
Votes in %
CIN
Domicile
93%
97%
556646-5893
Gothenburg
Zinzino OÜ
100%
100%
302606327
Tallinn
Zinzino UAB
100%
100%
12057494
Vilnius
Zinzino SIA
100%
100% 40103529390
Riga
Zinzino Ehf
100%
100%
580511-0660
Reykjavik
Zinzino LLC
100%
100%
90-0992153
Jupiter, FL
Zinzino Nordic AB
Subsidiaries wholly owned by
Zinzino Nordic AB:
2013
2012
Shareholding
Votes
Book
Book
in %
in %
value
value
Zinzino Sverige AB
100%
100%
100
100
Zinzino ApS
100%
100%
155
155
Zinzino AS
100%
100%
112
112
Zinzino Oy
100%
100%
77
77
Poxian AB
100%
100%
100
100
PGTwo AB
100%
100%
100
100
2 Think
100%
100%
93
93
737
737
Specification of subsidiary
Total
Name of subsidiary
Zinzino Sverige AB
CIN
Domicile
556646-5869
Gothenburg
Zinzino ApS
27266940
Copenhagen
Zinzino AS
986028269
Oslo
Zinzino Oy
1825505-2
Helsinki
Poxian AB
556655-2658
Gothenburg
PGTwo AB
556639-0513
Gothenburg
2 Think AB
556667-3983
Gothenburg
Zinzino Annual Report
42
Note
12
PREPAID EXPENSES AND ACCRUED INCOME
Parent company
Group
2013
2012
2013
2012
512
414
-
-
-
-
-
-
Other prepaid costs
1,304
2,387
-
38
Debit card receivables
3,226
3,763
-
-
Total
5,042
6,564
-
38
Prepaid leasing costs
Prepaid product costs
Note
13
EQUITY
CHANGE IN EQUITY IN PARENT COMPANY
Parent company
2013
2012
Share capital
Non-restricted
reserves
Total
equity
Share capital
2,708
19,424
22,132
2,708
-621
-621
18,803
21,511
Balance at start of year
Profit/loss for the year
Balance at end of year
2,708
Non-restricted Total equity
reserves
2,708
20,117
22,825
-693
-693
19,424
22,132
SHARE CAPITAL Of the company's 27,082,770 total shares, 6,113,392 are A-shares.
DEVELOPMENT IN SHARE CAPITAL
Year
Event
Total number of
shares
Increase in
shares
Total share
capital
Quota share
capital
2007
Company established
37,000,000
37,000,000
100,000
100,000
2007
New issue
37,803,188
74,803,187
102,069
202,069
2008
Bonus issue
0
0
545,963
748,032
2008
New issue
12,476,963
87,280,150
124,770
872,802
2009
New issue
135,022,681
222,302,831
1,350,227
2,223,029
2010
New issue
48,524,869
270,827,700
485,248
2,708,277
2010
Reverse split
-243,744,930
27,082,770
0
2,708,277
27,082,770
2,708,277
CHANGE IN EQUITY FOR GROUP
Group
Balance at start of year
2013
SHARE
CAPITAL
Non-restricted
reserves
Total
equity
2,708
9,676
12,384
Group contributions to equity
Profit/loss for the year
Balance at end of year
Zinzino Annual Report
2012
2,708
SHARE Non-restricted
CAPITAL
reserves
2,708
5,283
Total equity
7,991
202
202
-207
-207
9,027
9,027
4,600
4600
18,905
21,613
9,676
12,384
2,708
43
NOTE
14
BANK OVERDRAFT FACILITIES
The bank overdraft facilities granted for the Group amount to SEK 5 (3) million and for the parent company
amount to SEK 0 (0).
NOTE
15
OTHER LIABILITIES
Group
Tax liability
Retaining withholding tax
Compulsory social security contributions
Commission liabilities
NOTE
16
2013
2012
2013
2012
2,286
2,866
-
-
351
317
-
-
447
301
-
-
13,482
9,465
-
-
1,975
1,525
36
36
18,539
14,475
36
36
Other liabilities
Total
Parent company
ACCRUED EXPENSES AND DEFERRED INCOME
Parent company
Group
2013
2012
2013
2012
Accrued payroll-related expenses
3,624
3,520
-
-
Accrued commission
2,390
1,832
-
-
Accrued audit
434
322
40
40
Accrued shipping expenses
337
613
-
-
Accrued product expenses
1,202
1,359
-
-
515
610
-
122
8,501
8,256
40
162
Other accrued expenses
Total
NOTE
17
PLEDGED ASSETS
The group has restricted cash amounting to SEK 500,000 (SEK 400,000) relating to bank guarantees to
suppliers. Bank overdraft facilities amount to SEK 6 (3) million.
Zinzino Annual Report
44
Gothenburg, 22 April 2014
Hans Jacobsson Chairman of the Board of Directors Björn Flintberg Board Member Staffan Hillberg Board Member Dag Bergheim Pettersen
CEO
Cecilia Halldner
Board Member
Our auditor's report was submitted on 25 April 2014.
Öhrlings PricewaterhouseCoopers AB
Magnus Götenfelt
Certified Public Accountant
Note: This report is published in Swedish and English. In the event of any difference between the English version and the
Swedish original, the Swedish version shall prevail.
Zinzino Annual Report
45
Zinzino Annual Report
47