Zengun Group AB (publ) Interim Report January - September 2023

“Zengun reported a stable third quarter with several projects that wrapped up well, with satisfied customers and new assignments.”. Mick Salonen, President and CEO

Third quarter

•         Net turnover amounted to MSEK 608.2 (487.0)

•         EBITDA totalled MSEK 29.0 (24.0), corresponding to an EBITDA margin of 4.8% (4.9)

•         Earnings before tax amounted to MSEK 13.1 (8.2)

•         Operating cash flow was MSEK 64.2 (outflow: 43.7)

•         Orders received totalled MSEK 280.0 (1,425.5)

•         The order book amounted to MSEK 2,850.0 (4,216.3)

January - September

•         Net turnover amounted to MSEK 1,989.9 (1,726.1)

•         EBITDA totalled MSEK 88.9 (76.5), corresponding to an EBITDA margin of 4.5% (4.4)

•         Earnings before tax amounted to MSEK 41.4 (31.6)

•         Operating cash flow was MSEK 127.2 (6.4)

•         Orders received totalled MSEK 1,207.3 (2,698.0)

Statement by the CEO
Zengun reported a stable third quarter with several projects that wrapped up well, with satisfied customers and new assignments. We have solid order fulfilment and a satisfactory phase 1 order book despite a challenging market. We confirmed our strong position and have made good progress in our ongoing contracts. EBITDA for the quarter amounted to MSEK 29, up MSEK 5 year-on-year.

In September, the first earth was turned for Hästen 21, one of central Stockholm’s largest new construction projects that Zengun is building on behalf of Pembroke. During the third quarter, AMF Fastigheter had its first partial opening of Ringen Centrum, where Zengun re:do is renovating to open up space and let in more light. Hagastaden’s new life science innovation hub, Forskaren, which Zengun is building for Vectura Fastigheter, also opened for preview visits. With its inner stairs inspired by DNA strands and its symbolic exterior, the building is a new landmark in Stockholm.

New assignments around Stockholm
During the quarter, Zengun signed a construction contract with AMF Fastigheter for Marievik 14 in Liljeholmen. The entire area is now being developed into a dynamic city district connected to Södermalm. The project encompasses a total GFA of 9,000 square metres and the order volume amounts to approximately MSEK 230. Zengun and AMF Fastigheter have collaborated on the project planning since 2022, where the focus has been on ensuring that the office of the future will be circular in nature. Reducing climate impact is a high priority in the project and we are actively working with reused material.

During the third quarter of the year, Zengun also entered into a new partnership, where project planning is being carried out for a property with security classification. This is a task that requires particular consideration and expertise from our employees.  

Nominated for sustainable social infrastructure
Kvarter 1 in Haga Norra, Solna, which Zengun is building on behalf of Fabege, was nominated as “BREEAM building of the year” (Swe: “Årets BREEAM-byggnad”) in the Sweden Green Building Awards. We are proud of being one of the partners in this sustainable project.

Employees in focus
We continue to invest in our employees and their development. During the quarter we started our new leadership training, which was designed specifically for Zengun. Ten of our leaders are participating in this round. Through training, Zengun also continues to promote social responsibility and a healthy construction industry. During the quarter we had three training sessions for our employees aimed at raising awareness regarding crime in the labour market and to continue to educate them about construction site registration.

Bond buyback
During the third quarter, Zengun bought back the company’s own bonds at a total nominal amount corresponding to MSEK 5. The objective of the buyback was to once again reduce the company’s gross debt and interest expenses, which was enabled by the company’s strong cash position. We will continue to evaluate the bond market and it is possible, depending on our liquidity needs, that we will buy back additional bonds in the market.

Mick Salonen
President and CEO

For further information, please contact:
Mick Salonen, President & CEO, +46 (0) 70 569 66 73
Oskar Björklund, CFO, +46 (0) 79 072 84 57

This information is information that Zengun Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, on 24 November 2023 at 8:00 a.m. (CET).

Driving projects drives Zengun. We operate in Stockholm and Mälardalen, in close collaboration with customers and always with the project and people in focus. We help property owners improve their property portfolios in each project by offering know-how and skills as a collaboration and sustainability partner throughout the entire lifespan of the project. We build commercial properties, with a mix of select public-sector properties and residential projects. We take the long term into consideration for our employees, customers and surroundings, and are constantly developing to make each project a reference project. In 2022, Zengun had sales of approximately SEK 2.5 billion and 150 employees. #zengunbyggerstaden