Investor Presentation • Aug 5, 2021
Investor Presentation
Open in ViewerOpens in native device viewer
Investor presentation Q2 2021
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.
ACTIVITIES
LOCATION Narva, Ida-Viru county
CUSTOMER Academy of Security Sciences
ARCHITECT 3+1 architects
CONSTRUCTION PERIOD February 2019 - August 2020
CONTRACTOR Nordecon AS
PROJECT MANAGER Viljo Niit
| The groups' revenue for the first half of 2021 was €117,966 thousand, around 14% less than a year earlier when revenue amounted to €136,798 thousand. The decline is largely attributable to revenue from foreign operations that dropped by 68%. Revenue generated in Estonia decreased by 6% compared to the first half of 2020. In segment terms, revenue from the Buildings segment decreased by 19% while revenue from the Infrastructure segment grew by 9% year on чеаг. |
Nordecon ended the first half of 2021 with a gross profit of $£1,306$ thousand (H1 2020: $\epsilon$ 6,007 thousand) and gross margins that were considerably lower than a year earlier: 1.1% for the first half-year (H1 2020: 4.4%) and 2.0% for the second quarter $(Q2 2020: 5.9\%).$ Gross margin dropped in both main operating segments, due to the increase in input prices and uncovered Infrastructure segment's fixed costs, as well as one-off expenses in connection with completion of Nysäter wind farm project. |
The group's administrative expenses for the first half of 2021 were €2,833 thousand. Compared to the first half of 2020, administrative expenses decreased by around 27% (H1 2020: €3,860 thousand), mainly through a decline in personnel expenses. The ratio of administrative expenses to revenue (12 months rolling) decreased to 2.2% (H1 2020: $2.8\%$ ). |
|---|---|---|
| The group's operating loss for the first half of 2021 was €1,643 thousand (H1 2020: an operating profit of $\epsilon$ 2,013 thousand). |
The group's order book stood at $\epsilon$ 269,448 thousand at 30 June 2021, a 44% increase year on year. |
Operating activities produced a net cash outflow of €163 thousand in the first half of 2021 (H1 2020: an inflow of €1,787 thousand). |
| EBITDA amounted to $\epsilon$ 92 thousand (H1 2020: €3,694 thousand). |
In the second quarter, we signed new contracts of €69,938 thousand (Q2 2020: €47,850 thousand). |
Operating cash flow is strongly influenced by the fact that the contracts signed with most public and private sector customers do not require them to make advance payments, while the group has to make prepayments to subcontractors and suppliers. |
LOCATION Saue, Harju county
CUSTOMER Saue Municipal Government
ARCHITECT molumba
CONSTRUCTION PERIOD June 2019 - June 2020
CONTRACTOR Embach Ehitus OÜ
PROJECT MANAGER Lauri Tomp
The gross margins of the Buildings segment were 2.5% for the half-year and 2.8% for the second quarter compared with 5.0% and 5.5% in the same periods last year.
The Infrastructure segment ended the first half of 2021 with a a negative gross margin of 0.5% (H1 2020: a positive gross margin of 3.4%). Its gross margin for the second quarter was 3.2% (Q2 2020: 8.7%).
| Figure / Ratio | 6M 2019 | 6M 2020 | 6M 2021 |
|---|---|---|---|
| Revenue (EUR '000) | 100 411 | 136798 | 117 966 |
| Revenue change | -5% | 36% | $-14%$ |
| Net profit/loss (EUR '000) |
-574 | $-1419$ | -2 390 |
| Gross margin | 3.3% | 4.4% | 1,1% |
| EBITDA margin | 1.3% | 2,7% | 0,1% |
| Net margin | $-0.6%$ | 1.0% | $-2.0%$ |
| Administrative expenses to revenue (12 month rolling) |
2.9% | 2,8% | 2,2% |
LOCATION Sillamäe, Ida-Viru county
CUSTOMER Sillamäe Town Government
DESIGNER Selektor Projekt OÜ
CONSTRUCTION PERIOD August 2019 - December 2020
CONTRACTOR Nordecon AS
PROJECT MANAGER
Ivo Lõhmus
Estonia - Ukraine - Finland - Sweden
| 6M 2019 | 6M 2020 | 6M 2021 | |
|---|---|---|---|
| Estonia | 91% | 88% | 96% |
| Ukraine | 3% | $1\%$ | 1% |
| Finland | 4% | 5% | 3% |
| Sweden | 2% | 6% | 0% |
Revenue generated outside Revenue Estonia accounted for around 4% of the group's total revenue for the first half of 2021 compared with 12% a year earlier.
Swedish market decreased significantly year on year, subcontracting services in the also volatile and strongly affect dropping below 1% of the concrete works segment. group's total revenue, while the revenue contribution of the Ukrainian market remained comparable to a year earlier.
generated in the In Finland, we continue to focus However, conditions in some of the provision $O0$
of our chosen foreign markets are our current results.
The group's order book stood at €269,448 thousand at 30 June 2021, a 44% increase year on year.
The Buildings segment still dominates, accounting for 79%, while the Infrastructure accounts for 21% of the total order book (30 June 2020: 76% and 24%, respectively).
Compared with 30 June 2020, the order book of the Buildings segment has grown by 50% and that of the Infrastructure segment by 27%.
In the second quarter, we signed new contracts of $€69,938$ thousand ( $Q2$ 2020: €47,850 thousand).
Between the reporting date (30 June 2021) and the date of release of this report, group additional companies have secured construction contracts in the region of €81,771 thousand.
LOCATION Tallinn
CUSTOMER AS Tallinna Sadam
DESIGNER R-Konsult OÜ
CONSTRUCTION PERIOD June 2018 - July 2020
CONTRACTOR Nordecon AS
PROJECT MANAGER Marek Sööt
In the Buildings segment, the revenues of all subsegments decreased year on цеаг.
The revenue contributions of the commercial, public and apartment buildings subsegments were practically equal and the revenue generated by the industrial and warehouse facilities subsegment continued to be modest.
26
74
The order book of the public buildings subsegment has grown considerably, supporting the subsegment's annual revenue growth.
In the Infrastructure segment, road construction and maintenance continued to dominate with revenues almost twice larger than in the same period last year. A major share of its revenue resulted from contracts secured in 2020.
LOCATION Tiskre, Harju County
CUSTOMER Tiskreoja OÜ
ARCHITECT PIN Arhitektid OÜ
CONSTRUCTION PERIOD October 2019 - October 2020
CONTRACTOR Nordecon Betoon OÜ
PROJECT MANAGER Harry Rööpson
Largest shareholders in Nordecon AS at 30 June 2021
| Number of shares |
Ownership interest $(\% )$ |
||
|---|---|---|---|
| AS NORDIC CONTRACTORS | 17 607 464 | 54.39 | |
| LUKSUSJAHT AS | 4 288 403 | 13.25 | |
| Olegs Radcenko | 525 962 | 1.62 | |
| SEB PANK AS_CLIENTS | 425 000 | 1.31 | |
| Mati Kalme | 360 000 | 1.11 | |
| Lembit Talpsepp SEB LIFE AND PENSION |
354 239 | 1.09 | |
| BALTIC SE EESTI FILIAAL | 255 000 | 0.79 | |
| GENADI BULATOV SVENSKA HANDELSBANKEN CLIENTS |
250 600 | 0.77 | |
| ACCOUNT | 210 556 | 0.65 | |
| AIN TROMP | 203 960 | 0.63 |
| Indeks/aktsia | 01.01.2021 | 30.06.2021 | $+/-$ |
|---|---|---|---|
| OMX Tallinn | 1343.72 | 1656.33 | 23.26% |
| NCN1T | $1.14$ EUR | 1.41EUR | 23.68% |
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.