Interim financial report Q1 - Q3 2020
”I’m pleased with the upgraded outlook for 2020 announced on 29 October 2020 following a strong rebound of the UK market and an effective cost management. With these effects H+H can report solid margin defence showing an improved gross margin and EBITDA margin year to date in line with last year”, says CEO Michael T. Andersen.
Financial highlights for the period 1 January to 30 September 2020
| DKK million | Q3 2020 | Q3 2019 | Q1-Q3 2020 | Q1-Q3 2019 |
| Revenue | 712 | 779 | 2.012 | 2.215 |
| Gross margin before special items | 34% | 34% | 32% | 31% |
| Organic growth | (7)% | 5% | (9)% | 10% |
| Organic growth excluding the UK market | (7)% | 7% | 2% | 8% |
| EBITDA before special items | 162 | 182 | 396 | 435 |
| EBITDA margin before special items | 23% | 23% | 20% | 20% |
| EBIT before special items | 116 | 137 | 258 | 306 |
| EBIT margin before special items | 16% | 18% | 13% | 14% |
| NIBD/EBITDA ratio before special items ratio | 0.5 | 0.9 | 0.5 | 0.9 |
| Special items | 0 | 0 | 0 | 0 |
| Free cash flow | 136 | 136 | 166 | 175 |
Highlights
- Current trading in the majority of our markets perform as expected with overall stable development in Germany and softening of the Polish market.
- During the third quarter of 2020, we have seen recovery in the UK market after the lockdown where distribution centres and building sites closed in the end of March 2020 due to covid-19. The lockdown affected the market throughout the second quarter of 2020 with gradual re-opening in the end of the period.
- The UK recovery is now expected to increase faster than originally anticipated for the remaining part of 2020, supported by Government stimuli.
Financial outlook for 2020
Based on higher than expected demand in the UK market for the remaining part of 2020, H+H upgraded the financial outlook for the full year 2020 on 29 October 2020 as follows:
- Revenue growth before acquisitions, divestments and measured in local currencies is expected to be in the range -12% to -8% (previously in the range -16% to -8%)
- EBIT before special items is expected to be DKK 290-320 million (previously DKK 250-300 million)
- Investments, excluding acquisitions, divestments and IFRS 16 effect, are expected to be DKK 120-130 million (previously DKK 100-130 million)
The financial outlook for 2020 is based on the following specific assumptions:
- Any resurgence of covid-19 will not have severe impact in our markets
- No severe impact from disruption in supply chains and constructions sites due to the pandemic
- Financial liquidity is available in the markets to support housebuilding
Investor and analyst teleconference
H+H International A/S will host an investor and analyst teleconference today 13 November 2020 at 10:00 CET.
To attend the conference call, please see details below.
The conference call will be available at: https://streams.eventcdn.net/hplush/2020q3
Investors and analysts are invited to participate by phone.
DK: +4582333194
UK: +443333009272
US: +18338230586
For further information please contact:
CFO Peter Klovgaard-Jørgensen on telephone +45 35 27 02 00.
H+H’s core activity is the manufacture and sale of wall building materials, with a revenue in 2019 of DKK 2.8 billion. The mainproduct lines are aircrete blocks and calcium silicate units used for the residential new building segment. H+H has 29 factories in Northern and Central Europe with a total output of more than 4 million cubic metres of products annually and has a leading position in most of its markets. H+H has more than 1,600 employees and is listed on Nasdaq Copenhagen.