Investor Presentation • Aug 4, 2022
Investor Presentation
Open in ViewerOpens in native device viewer
Investor presentation Q2 2022
Industrial buildings
Public buildings
Residential buildings
Commercial buildings
Other infrastructure Environmental engineering Utility networks
Specialist engineering Bridges, viaducts Port construction
Rail construction
Road construction and maintenance Road construction Road maintenance
The Group will grow, mostly organically, with a focus on more efficient use of its existing resources.
In Estonia, we will operate, as market leader, in both the building and infrastructure construction segments.
In Sweden, we will focus on general contracting in Stockholm and the surrounding area.
In Finland, we will focus on general contracting and concrete works in Helsinki and the surrounding area.
In Ukraine, we will focus on general contracting and concrete works, primarily in Kiev and the surrounding area.
Improving profitability through more precise planning of our design and construction operations.
Increasing our design and digitalisation capabilities.
Simplifying and automating work and decision-making processes.
Monitoring the balance between the contract portfolios of different business segments.
Valuing balanced teamwork where youthful energy and drive complement long-term experience.
Noticing and recognising each employee's individual contribution and initiative.
Revenue will grow at least 10% per year.
The contribution of foreign markets will increase to 20% of revenue.
Real estate development revenue will grow to at least 10% of revenue earned in Estonia.
Operating margin per year will be consistently above 3%.
Operating profit per employee will increase to at least 10 thousand euros per year.
On average, at least 30% of profit for the year will be distributed as dividends.
BUSINESS LINES AND MARKETS ACTIVITIES FINANCIAL TARGETS
3
LOCATION Tallinn
CUSTOMER Rotermann City OÜ
ARCHITECT KOKO architects
CONSTRUCTION PERIOD April 2019 – April 2021
CONTRACTOR Nordecon AS
PROJECT MANAGER Oleg Kaas
| The group's revenue for the first half of 2022 was €149,256 thousand, roughly 27% larger than a year earlier when revenue amounted to €117,966 thousand. Revenue growth was attributable to the revenue of the Buildings segment, which grew by 40%. The revenue of the Infrastructure segment decreased by 21%. The decline in revenue generated by the Infrastructure segment is attributable to the cutback in investments made by the largest customer, the Transport Administration, |
Nordecon ended the first half of 2022 with a gross profit of €3,181 thousand (H1 2021: €1,306 thousand) and gross margins that were higher than a year earlier: 2.1% for the first half-year (H1 2021: 1.1%) and 2.5% for the second quarter (Q2 2021: 2.0%). The group's gross profit for both the first half and second quarter of 2022 was earned in the Buildings segment. The Infrastructure segment's performance was weaker than in the same period last year, |
The group's administrative expenses for the first half of 2022 amounted to €3,118 thousand. Compared with the same period last year, administrative expenses grew by around 10% (H1 2021: €2,833 thousand) due to general growth in the cost of goods and services. The ratio of administrative expenses to revenue (12 months rolling) declined year on year, decreasing to 2.0% (H1 2021: 2.2%). |
|---|---|---|
| The group ended the first half of 2022 with an operating profit of €1,457 thousand (H1 2021: an operating loss of €1,643 thousand). |
The group's order book stood at €220,687 thousand at 30 June 2022, reflecting an 18% decrease year on year. |
Operating activities produced a net cash outflow of €1,955 thousand the first half of 2022 (H1 2021: an outflow of €163 thousand). |
| EBITDA for the period amounted to €3,158 thousand (H1 2021: €92 thousand). |
In the first half and second quarter of 2022, we signed new contracts of €89,661 thousand and €26,494 thousand, respectively (H1 2021: €174,820 thousand and Q2 2021: €69,938 thousand). |
Operating cash flow is increasingly affected by the need to make prepayments to materials suppliers, which have grown due to spikes in materials prices and continuing supply disruptions. |
5
LOCATION Kohtla-Järve, Ida-Viru County
CUSTOMER Kohtla-Järve City Government
ARCHITECT OÜ Zoroaster
CONSTRUCTION PERIOD April 2019 – March 2021
CONTRACTOR Nordecon AS
PROJECT MANAGER Oleg Kaas
The Buildings segment delivered gross margins of 3.8% for the half-year and 3.4% for the second quarter (H1 2021: 2.5% and Q2 20221: 2.8%).
The Infrastructure segment had negative gross margins for both the first half-year and second quarter: (6.4)% and (0.3)%, respectively (H1 2021: (0.5)% and Q2 2021: 3.2%).
| Figure / Ratio | 6M 2020 | 6M 2021 | 6M 2022 |
|---|---|---|---|
| Revenue (EUR ´000) | 136 798 | 117 966 | 149 256 |
| Revenue change | 36% | -14% | 27% |
| Net profit/loss (EUR ´000) |
1 419 | -2 390 | -26 |
| Gross margin | 4,4% | 1,1% | 2,1% |
| EBITDA margin | 2,7% | 0,1% | 2,1% |
| Net margin | 1,0% | -2,0% | 0.0% |
| Administrative expenses to revenue (12 month rolling) |
2.8% | 2.2% | 2.0% |
7
LOCATION Tartu city
CUSTOMER Tartu Kesklinna Perearstikeskus OÜ
DESIGNER U-Disain OÜ
CONSTRUCTION PERIOD February 2020– August 2021
CONTRACTOR Nordecon Betoon OÜ/ Embach Ehitus OÜ
PROJECT MANAGER Ahti Kala
| 2022, foreign markets subsidiary Eurocon Ukraine reporting period. Swedish market. accounted for around 3% of TOV have been temporarily total revenue. suspended: in the second quarter the subsidiary continued work on one building project in Kiev. |
The group's revenues from outside Estonia have decreased. In the first half of |
Due to Russia's military invasion of Ukraine, full-scale operations of the group's Ukrainian |
The group also operates on a project basis in Latvia where it was building a wind farm in the |
The group did not generate any revenue and had no ongoing construction contracts in the |
|---|---|---|---|---|
| ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------- |
The group's order book stood at €220,687 thousand at 30 June 2022, reflecting an 18% decrease year on year.
Regarding proportions, the Buildings segment still dominates, accounting for 85%, while the Infrastructure accounts for 15% of the total order book (30 June 2021: Buildings: 79% and Infrastructure: 21%).
In the first half and second quarter of 2022, we signed new contracts of €89,661 thousand and €26,494 thousand, respectively (H1 2021: €174,820 thousand and Q2 2021: €69,938 thousand). 0
LOCATION Rae, Harju County
CUSTOMER Rae Rural Municipality Government
DESIGNER Sweco Projekt AS
CONSTRUCTION PERIOD November 2019 – May 2021
CONTRACTOR Nordecon AS
PROJECT MANAGER Silver Sein
In the first half of 2022, the Buildings and the Infrastructure segment generated revenue of €128,430 thousand and €20,703 thousand, respectively. The corresponding figures for the first half of 2021 were €91,557 thousand and €26,217 thousand.
In the Buildings segment, the revenues of all subsegments grew compared with the same period last year.
The revenue contributions of the apartment, the commercial and the public buildings subsegments were practically equal while the revenue contribution of the industrial and warehouse facilities subsegment was somewhat smaller.
In the Infrastructure segment, the largest revenue contributor is still road construction and maintenance although its revenue and proportionate contribution have decreased.
LOCATION Käina, Hiiu County
CUSTOMER Hiiumaa Consumers Cooperative Association
ARCHITECT DAGOpen Arhitektuuribüroo
CONSTRUCTION PERIOD December 2020– June 2021
CONTRACTOR Nordecon Betoon OÜ
PROJECT MANAGER Reino Mälk
| Number of shares |
Ownership interest (%) |
|
|---|---|---|
| AS NORDIC CONTRACTORS | 16 563 145 | 51.16 |
| LUKSUSJAHT AS | 4 301 603 | 13.29 |
| TOOMAS LUMAN | 663 500 | 2.05 |
| OLEGS RADCENKO | 580 000 | 1.79 |
| LEMBIT TALPSEPP | 376 239 | 1.16 |
| NÕMME ERAHARIDUSE SA | 370 370 | 1.14 |
| SEB PANK AS_CLIENTS SEB LIFE AND PENSION |
300 000 | 0.93 |
| BALTIC SE EESTI FILIAAL | 255 000 | 0.79 |
| GENADI BULATOV SVENSKA HANDELSBANKEN |
250 600 | 0.77 |
Nordecon AS Tel: +372 615 4400 www.nordecon.com Toompuiestee 35, Tallinn 10149 Estonia
Head of Investor Relations Andri Hõbemägi Tel: +372 615 4400 [email protected]
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.