Interim Report April – June 2022
Strong organic growth and a record number of acquisitions
• Net sales increased by 16 percent to SEK 6,434 million (5,570)
• The order backlog rose by 17 percent to SEK 17,436 million (14,908)
• EBITA rose by 15 percent to SEK 376 million (327)
• The EBITA margin was 5.9 percent (5.9)
• Profit after tax was SEK 286 million (246)
• Cash flow from operating activities was SEK 62 million (317)
• Net debt amounted to SEK -1,760 million (-1,600)
• Ten acquisitions were made during the quarter, adding annual sales of approximately SEK 624 million
• Basic and diluted earnings per share were SEK 1.39 (1.23) and SEK 1.38 (1.23)
During the quarter, total net sales increased by 16 percent, of which 8 percent was organic.The order intake increased by 9 percent and the order backlog is now at its highest level ever. With stable demand and a record order backlog, Bravida remains well positioned for the coming quarters.
Net sales and EBITA
I am pleased with our performance during the quarter, and above all with the high organic growth of 8 percent. Once again, we are delivering a stable report where we see continued good demand and an order backlog that once again is at a record level. The EBITA margin remained unchanged, at 5.9 percent. We have further strengthened the cooperation with a number of our suppliers and are helping each other in various ways to cope with price increases and ensure a good supply of materials. Work on the Group’s initiatives to safeguard future profitability and growth is proceeding apace, in the quarter we have incurred costs of SEK 22 million. It is pleasing to see that the work put in to improve profitability in Finland is continuing to pay off in terms of the profit margin. The Norwegian business has experienced strong growth but with a lower profit margin, which is partly explained by a shift in the sales mix towards more installation work. We have initiated a number of activities for margin increasing measures. Another contributing factor is that the cost of sickness absence in Norway remains at a relatively high level in the quarter.
Stable cash flow and continued low levels of debt
Operating cash flow decreased during the quarter, mainly due to accrual of paid accounts payable, advance of material purchases that affect inventory and increased paid tax. The debt ratio remains at low level.
The acquisitions are at a record level for Bravida. So far this year, 21 acquisitions have been completed, including five in July, which are expected to add approximately SEK 1,565 million in sales. During the quarter, we completed 10 acquisitions, which are expected to add sales of approximately SEK 624 million. During the past few years, we have built up a significant pipeline of potential acquisition candidates, which we are now working our way through. In terms of future prospects, we continue to see solid opportunities to maintain a good pace in our acquisitions, although not at the same level as in the first half of 2022. We expect a lower price level for future acquisitions as a result of the general economic trend.
Bravida is leading and driving developments in the industry and I am proud that we are a market participant that dares to break new ground. Back in 2019, we launched an environmentally- friendly car policy for our employees and almost a year ago we launched Bravida GreenHub – providing sustainable service in city centres. During the last quarter, we have seen an increase in demand for our services, which indicates that the market is maturing in terms of wanting fossil-free service provision. We have now signed service agreements with several major companies that operate in city centres and are pleased to be working with our customers to reduce emissions.
I expect the market development in the coming quarters to be stable, although external factors are making it more difficult than usual to assess this. Bravida has so far not seen any significant impact on demand due to the current situation in the world. Demand for service will remain strong while demand for installation is more difficult to assess, as some segments are more sensitive than others to the impact of macroeconomic effects. In general, in times of falling commodity prices, we expect the price of materials to adjust downwards, but it has been and is a challenging time and it is in such times that partnerships are tested and long-term cooperation becomes even more important. Just as our customers appreciate and value Bravida due to it being a stable supplier, this is also what we value among our suppliers, and it will therefore have a even higher priority on our agenda going forwards. In an uncertain market, we continue to focus on the order situation at our more than 300 branches. Bravida’s decentralised business model allows for significant flexibility in terms of cost adjustment and resource planning. High energy prices are likely to accelerate the green transition and the making of decisions about energy efficiency improvements in buildings. I am confident about the coming quarter, as we have stable demand and a strong order backlog.
Stockholm, July 2022
The report will be presented at 09:30 CET by CEO and Group President Mattias Johansson and CFO Åsa Neving. The presentation will be held in English and can be followed on the web or on the phone. There will be room for questions in the telephone conference.
Link to webcast
Telephone conference dial-in number
The report and presentation will be available on www.bravida.se/en/investors
For further information, please contact:
Peter Norström, Head of Investor Relations
+46 8 695 20 07
This disclosure contains information that Bravida Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 15 July 2022, 07:30 CET.