Interim report October–December 2016

October–December 2016

• Net sales increased by 9% to SEK 4,277 million (3,919)
• The order backlog rose by 22% to SEK 8,644 million (7,092)
• Operating profit increased by 28% to SEK 353 million (275)
• The operating margin improved to 8.3% (7.0)
• Adjusted operating profit was SEK 353 million (308). Specific costs were SEK – million (33). The adjusted operating margin was 8.3% (7.9)
• Profit after tax was SEK 255 million (56)
• Cash flow from operating activities was SEK 415 million (694)
• Net debt amounted to SEK 2,417 million (2,433)
• Four acquisitions were completed in the quarter, adding annual sales of SEK 430 million
• Earnings per share were SEK 1.26 (0.28) 

CEO statement

“The fourth quarter was the best ever quarter in Bravida’s history"

Fourth quarter sees organic growth
During the period, net sales increased by 9 percent, 4 percent of which was organic. In Norway and Denmark growth was strong and Sweden once again showed growth in the quarter, which contributed to the Group’s overall growth. Project selection resulted in lower net sales in Finland, but the operating margin improved in line with our focus on ‘margin before volume’.
An important element in creating a national business in Finland was the acquisition of Asentaja in the Ostrobothnia region of the country. Asentaja has strengthened our platform and we can now progress in achieving a strong market position in Finland.
We are pleased with the development of the organic growth in the fourth quarter, but full-year growth for 2016 did not reach our financial target. To create even better conditions for growth and profitability we are reviewing how our security, sprinkler, cooling, technical facilities management and power businesses are organised.

Margins continue to increase
Bravida’s adjusted operating margin improved in the fourth quarter from 7.9 percent in 2015 to 8.3 percent. The improvement in the margin is the result of our initiatives to make improvements in productivity and purchasing, as well as careful project selection. Operating margins have improved in Sweden, Denmark and Finland. In Norway, the operating margin decreased from a high level, but it is still the highest in the Group.

Improved order level
Our order backlog, which only contains installation projects, continued to increase and it is now generating growth. In the fourth quarter, the order backlog rose by SEK 169 million, reaching a new record level of SEK 8,644 million.
Operations in south-west Norway posted a strong order intake in the quarter and in Stavanger Bravida received an order for SEK 290 million from the Norwegian Public Roads Administration.

Seasonally strong cash flow
Cash flow for the fourth quarter was reasonable but lower than the previous year, which was exceptionally strong. Our increase in service sales, which account for 47 percent of total sales, has a negative impact on cash flow as we bill customers in arrears. We did not achieve our cash conversion target for the full-year 2016, which places an even stronger focus on achieving this target in 2017.

Platform established for good performance in 2017
We will see continued good demand for Bravida’s services and there is positive potential for continued growth. Our focus on ‘margin before volume’ aims to balance resource shortages and pricing pressure against demand. A meticulous approach and correct pricing are key to continued healthy profitable growth.
We are well positioned for 2017 thanks to our strong order backlog and good demand.

Mattias Johansson, Stockholm, February 2016

For further information, please contact:
Mattias Johansson, CEO and Group President of Bravida. Tel: +46 8 695 20 00
Nils-Johan Andersson, CFO of Bravida. Tel: +46 70 668 50 75
IRcontact@bravida.com

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 07:30 CET on 22 February 2017.

The report will be presented at 09:30 CET by CEO and Group President Mattias Johansson and CFO Nils-Johan Andersson. 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:
http://edge.media-server.com/m/p/2tg9o9je

Telephone numbers for telephone conference:
SE: +46850556474
UK: +442033645374
US: +18557532230

The report and the presentation are available on bravida.se/en/investors/.

Bravida is a leading multi-technical service provider in the Nordics, with more than 9,700 employees. Bravida delivers specialist services as well as complete electrical, heating and plumbing, and HVAC solutions, offering everything from design and project planning to installation, operation and maintenance. Bravida is represented in around 150 locations in Sweden, Norway, Denmark and Finland. www.bravida.se/en/

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