Bravida Interim Report January–March 2014

• Net sales were SEK 2,848 million (2,729)
• The operating profit was SEK 145 million (148)
• Cash flow from operating activities was SEK 272 million (254)

Bravida grew during the first quarter to SEK 2,848 million­, which is an increase of 4.4 per cent. The operating margin amounted to 5.1 per cent (5.4). Cash flow from operating activities increased by 7.1 per cent to SEK 272 million. The order backlog has continued to improve and was SEK 5,879 million (4,914).

Bravida’s operating profit for the first quarter of 2014 was SEK 145 million, compared with SEK 148 million for the same quarter last year. It is pleasing to see that Division Norway has achieved a considerable improvement in both sales and operating profit.   The operating margin for the quarter was 5.1 per cent (5.4), while sales increased by over 4 per cent to SEK 2,848 million (2,729).

We are seeing significant improvement in Division Norway, where profitability has been improved and has stabilised over the last three quarters. The positive trend in Division Denmark is continuing, thanks to growth of 19 per cent, while at the same time the order backlog remains strong. In Sweden, Division North continues to enjoy positive development in sales, albeit the result did not reach the same high level as last year. Sales and profit in Division Stockholm were lower compared with the same period last year, while Division South has remained more stable in terms of both sales and profitability.

It is pleasing to see that operating cash flow has remained good during the first quarter of 2014.

The order intake during the first quarter of 2014 was 6 per cent lower compared with the same period last year. This fall can be attributed to Division Stockholm, which has seen its order intake worsen over the past year as a result of price pressure in small and medium-sized installations and service contracts. The order backlog at the end of the period nevertheless remained high and amounted to SEK 5,879 million (4,914), thanks largely to Division Denmark, where we have seen greater interest in infrastructure investments and increased demand from the public sector. The Group received major orders during the first quarter, primarily in infrastructure, education, healthcare and housing. Public-sector investments still account for a large share of growth in the market while activity in industry, residential construction and new commercial builds is generally stable, but is falling in some geographical areas.

As Bravida operates in a highly competitive market, active work and strict guidelines are necessary for the selection of tenders. Bravida also 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 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. The project has already achieved positive results, mainly in service activities.

After the quarter end, Bravida acquired Norwegian Otera Electro and thereby strengthen our position as one of the leading suppliers in installation and service in the Norwegian market. Acquisitions are an important part of Bravidas growth strategy.

Our assessment is that the economy as a whole has stabilised and that the market will improve gradually in 2014, but with significant regional variations. 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, while at the same time achieving growth, both organically and through further acquisitions.

Staffan Påhlsson

CEO and Group President

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Bravida Holding AB publishes this interim report in compliance with the Swedish Securities Market Act and/or the Swedish Financial Instruments Trading Act. This information was submitted for publication at 10.00 a.m. on 8 May 2014.