Bravida’s operating profit for the full year 2013 increased by 5 per cent to SEK 600 million (570), equivalent to an operating margin of 5.4 per cent (5.0). Sales fell to SEK 11,080 million (11,400), while cash flow from operating activities improved by 8 per cent to SEK 457 million (424).
Bravida’s operating profit for the fourth quarter was SEK 234 million, an increase of 20 per cent compared with the same quarter last year. This improvement was mainly due to stronger results in Division Denmark and Division North. The operating margin for the fourth quarter was 7.5 per cent (6.3), while sales increased marginally to SEK 3,113 million (3,100).
Division Denmark has seen a marked improvement in profitability, with progress in terms of both order intake and profitability, while the market has also stabilised during the year. Division Norway has experienced a negative sales and profit trend during the year, although this has been reversed in the last quarter. In Sweden, Division North continues to grow, both in terms of sales and profitability, Division Stockholm has remained relatively stable, whilst Division South has lower sales and profitability.
It is also pleasing to see that the cash flow has improved in 2013 compared with 2012. Cash flow from operating activities was SEK 457 million (424).
The order intake exceeded sales for both the fourth quarter and the year as a whole. Order intake increased by 6.8 per cent to SEK 12,346 million (11,564) in 2013. This increase is primarily attributable to Division Denmark and Division North. The order backlog at year-end is the highest in Bravida’s history and amounted to SEK 6,075 million (4,809), thanks largely to Division Denmark, where we have seen greater interest in infrastructure investments. A number of significant orders from customers in the road, rail and energy sectors has contributed to this positive development, including Bravida’s work with French company Alstom Transport, which involves the replacement of the current signalling systems on the Danish islands of Zealand and Funen. This order alone is worth more than DKK 300 million.
Public-sector investments still account for a large share of growth in the market while activity in industry, residential construction and new commercial builds remains stable, but weaker in some areas. As Bravida operates in a highly competitive market, a continued selective approach to high-risk installation projects with poor profitability is necessary. Bravida therefore works consistently to increase the share of revenues generated in our higher-margin service business while keeping a close eye on costs. In 2013, we also began working on a Group-wide change project designed to improve and streamline our working methods and production. The project involves all departments and will continue in 2014.
Our assessment is that the economy as a whole has stabilised and that the market will improve gradually in 2014, but with significant regional variation. Bravida expects to see positive growth during the second half of 2014 and our aim is to continue to deliver profitability in the top tier of our industry. The company currently has around 8,000 skilled employees and our goal is to achieve profitable growth, both organically and through acquisitions.
CEO and Group President
Bravida Holding AB discloses the financial statement under the Swedish Securities Market Act and/or he Swedish Financial Instruments Trading Act. Submitted for publication at 9:00 CET February 20, 2014.