Interim report April–June 2019
High acquisition rate and a good market
- Net sales increased by 6% to SEK 5,087 million (4,790)
- Organic growth was -1% (4)
- The order backlog was 25% higher at SEK 13,905 million (11,139)
- EBITA decreased by 2% to SEK 274 million (280)
- The EBITA margin was 5.4% (5.9)
- Profit after tax was SEK 201 million (212)
- Cash flow from operating activities was SEK 131 million (319)
- Net debt amounted to SEK -2,612 million (-1,896)
- Seven acquisitions were completed in the quarter, adding annual sales of approximately SEK 340 million
- Basic and diluted earnings per share were SEK 0.99 (1.05)
The demand for technical service and installations remains on a good level. Sales increased in the second quarter and Bravida is continuing to grow in the area of service. The EBITA margin was lower than last year due to lower earnings in Norway and Denmark. The order backlog continued to increase and is at a new record high. The high pace of acquisitions continues, with seven acquisitions completed in the quarter.
Sales growth through acquisitions
Bravida continued to grow in the second quarter, with sales rising by 6 percent as a result of acquisitions. Service sales rose by 11 percent in the quarter, which is pleasing as service assignments generally constitute recurring business. The market remains good in general, which is reflected in a higher order intake. Our order backlog increased by just over SEK 400 million to a new record high of SEK 13.9 billion. The strong order backlog has given us the possibility to focus even more on project selection. This, together with the fact that our large projects were in a less intensive stage, explains the organic growth of -1 percent in the quarter.
Lower EBITA margin but stable cash flow
The EBITA margin improved in Sweden and Finland, but decreased in Norway and Denmark. In Norway, we completed the two loss-making projects we have previously mentioned. The projects were part of the order backlog from the acquisition of Oras and have resulted in significant project write-downs. In Denmark, acquisition-related integration costs had a negative impact on earnings. Together, this led to a lower EBITA margin in the quarter.
Cash flow remained stable and cash conversion was 113 percent.
Acquisitions continue to strengthen Bravida
Bravida’s growth and market position in both service and installation continue to strengthen through acquisitions. So far this year we have completed twelve acquisitions, whereof seven in the quarter, adding annual sales of almost SEK 700 million. The acquisitions strengthen our local market position, complement our business and expand our offering.
Over the past five years we have carried out 70 acquisitions, adding sales of just over SEK 6 billion with good profitability. Bravida has an effective acquisition model that creates value for our shareholders, and I believe we can continue growing through acquisitions.
Bravida has a well-balanced level of risk as a result of being based in around 160 locations in the Nordic region and having over 55,000 customers across different segments. Our geographical diversification, our broad offering and our solid and differentiated customer base provides us with low exposure to individual markets and customers.
The order backlog is at a record high and the emphasis of the order backlog is on many small and medium-sized installation projects. Together with our large service operations, the order backlog will contribute to stable sales development going forward. Long-term underlying profitability remains good, and I am positive about our future development.
Mattias Johansson, Stockholm, July 2019
For further information, please contact:
Mattias Johansson, CEO and Group President of Bravida. Tel: +46 8 695 20 00
Åsa Neving, CFO. Tel: +46 8 695 22 87
This information is information that Bravida Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 11:30 CET on 19 July 2019.
The report will be presented at 13:30 CET by CEO and Group President Mattias Johansson and CFO Åsa Neving. The presentation will be held in English and can be followed on the web or over the phone. There will be room for questions.
Link to the webcast:
Telephone numbers for telephone conference:
SE: +46 8 505 583 53
UK: +44 3333 0090 31
US: +1 646 722 49 57
The report and the presentation are available on bravida.se/en/investors/.
Bravida is the leading end-to-end service and installation provider in the Nordics, with over 11,000 employees. Bravida provides both specialist services and end-to-end solutions within electrical, heating and plumbing, HVAC, security, cooling, sprinklers, technical service management and power supply. Bravida is present in around 160 locations in Sweden, Norway, Denmark and Finland. www.bravida.se