Interim report second quarter and first half-year 2017
Second quarter 2017
Strong order intake and invoicing based on a favourable business climate and generally strong companies have resulted in continued favourable margins.
It has been an interesting and intensive introduction for me as the new CEO of Indutrade. I am very impressed by the Group, with its distinctive customer-centric and results-oriented companies that are led by engaged managing directors in a decentralised and entrepreneur-driven culture. During my first months on the job I have prioritised travelling around and meeting with many of our companies, and we have also had an inspiring managing directors’ conference. Our ambition is to continue steadily improving Indutrade with focus on sustainable, profitable growth!
Most markets were characterised by a positive business climate with higher demand during the second quarter. Finland has continued to develop in a positive direction, and several of our companies there have achieved all-time high earnings. The Measurement & Sensor Technology business area is also doing very well, as many of our customers need our technology to make their products “smarter”. The situation remains tough in the marine segment, and in certain parts of power generation we are seeing lower volumes compared with a year ago.
The quarter had fewer invoicing days than in 2016 due to Easter, but despite this, order intake grew by 15% and invoicing by 13% through favourable organic growth and acquisitions.
A majority of the Group’s companies are showing good earnings performance, resulting in an EBITA margin of 12.2%, which is level with the same period a year ago.
During the quarter we carried out two acquisitions with combined annual sales of SEK 180 million: Pro-Flex AS (Norway) is active in hoses and couplings for demanding customer applications, and MaxxVision GmbH (Germany), our first direct investment in Germany, works with image handling technology for industrial processes.
After the end of the quarter we made four additional acquisitions: Wennerström Ljuskontroll (Sweden) specialises in light control and lighting components; Elma Instruments (Denmark) specialises in testing and measurement instruments in the Scandinavian market; Young Black (UK) is a “one-stop shop” for fastening products, pneumatic tools, compressors, hoses and couplings for British industry; and Tubeworkx (Netherlands) is a manufacturer of niche tube components for industrial customers.
Indutrade has a strong balance sheet, and our pipeline of interesting acquisition candidates is deep, which creates favourable prospects for further acquisitions.
We have had a good start to the year, and the strong order intake gives us confidence about favourable performance also during the second half of the year.
Indutrade’s business model has proved to be very successful over a long period of time and remains fast. However, our ambition is to continuously be better and to further develop our business model. As new CEO I feel great enthusiasm ahead of this task and look with confidence towards the years ahead. Our ambition and belief is that we will be able to offer the shareholders a competitive return also in the future.
President and CEO
This report will be commented upon as follows:Through a conference call/webcast at 1 p.m. (CET) today under the following link: http://event.onlineseminarsolutions.com/r.htm?e=1448966&s=1&k=A70638B25865BF4EAA0A9CF8C64DA683 To participate, call: SE: +46 8 566 42 665 UK: +44 203 008 9810 USA: +1 855 831 59 45
For further information, please contact: Bo Annvik, President and CEO: +46 8 703 03 19
Indutrade markets and sells components, systems and services with a high-tech content to industrial customers in selected niches. Indutrade’s business is distinguished by the following factors, among others:
- High-tech products for recurring needs
- Growth through a structured and tried-and-tested acquisition strategy
- A decentralised organisation characterised by an entrepreneurial spirit
The Group is structured into six business areas: Engineering & Equipment, Flow Technology, Fluids & Mechanical Solutions, Industrial Components, Measurement & Sensor Technology and Special Products.
The Group’s financial targets (per year across a business cycle) are to grow by a minimum of 10%, to attain a minimum EBITA margin of 10% and a minimum return on operating capital of 20%.