Multiconsult

Earnings Release • Aug 23, 2023

Multiconsult - good quarter with strong organic growth and result

Multiconsult - good quarter with strong organic growth and result

Multiconsult ASA (OSE: MULTI)

Multiconsult's second quarter EBITA was NOK 55.6 million, which gives an EBITA

for the first half of 2023 of NOK 271.9 million. The EBITA margin for the

quarter was 4.8 per cent, and 11.0 per cent for the first half of the year. The

result was positively impacted by increased capacity, higher billing rates and

increased billing ratio. Solid operational performance and a high activity level

throughout the quarter resulted in a growth in net operating revenues of 10.0

per cent to NOK 1 153.8 million, mainly driven by strong organic growth of 10.9

per cent. Solid order intake during the quarter provides a strong and

diversified order backlog for Multiconsult going forward.

SECOND QUARTER 2023

· Good quarter with strong organic growth, strong operational performance and

results in most segments

· Net operating revenues increased to NOK 1 153.8 million (1 048.5), a y-o-y

growth of 10.0 per cent. The organic revenue growth for the quarter was 10.9 per

cent

· EBITA of NOK 55.6 million (74.7) down NOK 19.1 million y-o-y, affected by

one less working day. EBITA margin equal to 4.8 per cent (7.1)

· Other operating expenses of NOK 150.3 million (132.7)

· Other opex ratio (ex. IFRS 16) of 17.2 per cent (16.9)

· Strong order intake of NOK 1 572 million (1 224)

· All-time high order backlog of NOK 4 943 million (3 521)

· Billing ratio of 72.1 per cent (71.9), up 0.2pp

· Full-time equivalents (FTE) increased by 8.0 per cent, to 3 360 (3 112)

· Strategic acquisition of A-lab, a leading Norwegian architecture firm -

announced in June

· Strong position as a preferred employer confirmed in 2023 Universum survey

· Market outlook is still considered good - uncertainty increased compared to

previous quarter

· During the quarter a political decision was made to suspend work on the new

emergency hospital in Växjö, Sweden

FIRST HALF 2023

· Net operating revenues of NOK 2 464.0 million (2 186.6), a y-o-y growth of

12.7 per cent. The organic revenue growth for the period was 11.6 per cent

· Strong EBITA of NOK 271.9 million (243.9), equal to an EBITA margin of 11.0

per cent (11.2)

· Order intake at a high level of NOK 4 146 million (2 691)

· Order backlog at a high level of NOK 4 943 million (3 521)

· Other operating expenses of NOK 290.5 million (259.3)

· Other opex ratio (ex. IFRS 16) of 15.7 per cent (16.0)

· Net profit of NOK 194.1 million (179.4)

· Earnings per share 7.07 (6.55)

· Full-time equivalents (FTE) increased by 6.2 per cent, to 3 289 (3 098)

COMMENTS FROM CEO, GRETHE BERGLY:

Multiconsult delivered a good quarter with strong organic growth of 10.9 per

cent. The overall demand for our services has been strengthened and is reflected

by strong sales and a 6.2 per cent increase in the order backlog from the first

quarter. The increased revenue is mainly driven by higher billing rates and

increased capacity. The EBITA for the quarter was NOK 55.6 million (EBITA margin

was 4.8 per cent) and is affected by one less calendar day. For the first half

of the year the EBITA margin remains high at 11.0 per cent.

We are pleased to report that the demand for our services remains robust,

leading to the continual strengthening of our order book. Order intake in the

quarter increased to NOK 1 572 million, an increase of 28.5 per cent compared to

the same quarter last year. The order backlog now stands at NOK 4 943 million,

an increase of 6.2 per cent from the first quarter and 40.4 per cent compared to

the end of second quarter last year.

Through the acquisition of 70 per cent of A-lab, we strengthen our position in

architecture and urban development as a tool in social development.

Interdisciplinary collaboration between the best expertise environments is

important when solving the challenges facing society.

The confirmation of Multiconsult as a preferred employer puts us in a strong

position to attract and retain the right talents, and we increase the number of

employees by 10.3 per cent. The new hires alongside our talented, dedicated

employees form a strong foundation for solving the challenges facing us. The

demand for Multiconsult's services remain strong and we are well positioned to

meet the challenges ahead in scaling up on the solutions regarding climate

adaption, energy efficiency and renewable energy. As more priority and attention

is given to social sustainability, our role in large transformation projects for

hospitals, schools and housing is strengthened and we have a solid portfolio

within these areas.

For a full review of comments from our CEO, please refer to our second quarter

and first half result 2023 report.

FINANCIAL REVIEW, SECOND QUARTER 2023:

Net operating revenues came in at NOK 1 153.8 million (1 048.5), an increase of

10.0 per cent compared to the same quarter last year. The organic revenue growth

amounted to 10.9 per cent adjusted for calendar effect and acquisition. The

increase in net operating revenues was mainly driven by higher capacity,

reflected by an increase in full-time equivalents (FTE) by 8.0 per cent. The

majority of the increase in full-time equivalents (FTE) was organic growth.

Additionally, higher billing rates and an increased billing ratio made positive

contributions to the growth in net operating revenues.

Operating expenses consist of employee benefit expenses and other operating

expenses. Operating expenses increased by 13.1 per cent to NOK 1 044.5 million

(923.5) compared to the same quarter in 2022. Employee benefit expenses

increased by 13.1 per cent due to ordinary salary adjustment, net recruitment,

and higher cost from the increased employer contribution tax of 5 per cent (for

salaries/compensation above NOK 750 thousand) in Norway. Other operating

expenses increased to NOK 150.3 million (132.7), an increase of 13.2 per cent

partly due to higher office expenditure and general cost increase related to

inflation.

EBITDA was NOK 109.3 million (125.0), a decrease of 12.6 per cent compared to

the same period last year, reflecting an EBITDA margin of 9.5 per cent (11.9) in

the quarter.

EBITA was NOK 55.6 million (74.7), reflecting an EBITA margin of 4.8 per cent

(7.1) in the quarter.

FINANCIAL REVIEW, FIRST HALF 2023:

Net operating revenues increased by 12.7 per cent to NOK 2 464.0 million (2

186.6), when compared to the same period last year. The billing rates continued

to improve and contributed positively on net operating revenues. Billing ratio

came in at 71.5 per cent, down 0.1pp. Organic growth in the period was 11.6 per

cent, adjusted for calendar effect and acquisition.

Operating expenses consist of employee benefit expenses and other operating

expenses. Reported operating expenses increased by 13.1 per cent to NOK 2 083.5

million (1 841.5) compared to the first half year of 2022. Employee benefit

expenses increased by 13.3 per cent and came in at NOK 1 793.0 million (1

582.2), an increase mainly driven by net recruitment and employee benefit

expenses arising from acquisitions. In addition, regular salary adjustment and

increased employer contribution tax in Norway contributed to the growth in

employee benefit expenses. Other operating expenses increased by 12.0 per cent

to NOK 290.5 million (259.3), partly an effect of operating expenses included

from prior acquisitions, such as office expenses, and general cost increase

related to inflation.

EBITDA was NOK 380.5 million (345.1), an increase of 10.3 per cent compared to

the same period last year, reflecting an EBITDA margin of 15.4 per cent (15.8).

EBITA was NOK 271.9 million (243.9), an increase of 11.5 per cent y-o-y,

reflecting an EBITA margin of 11.0 per cent (11.2).

OUTLOOK

The positive trend and strong market development for Multiconsult's services has

continued throughout the quarter. Market outlook is still considered good -

uncertainty increased compared to previous quarter. The pipeline of upcoming

projects is still considered strong, however we are experiencing a slight

reduction in market opportunities. We expect somewhat lower investment levels in

parts of our markets leading to increased competition and pressure on margins.

The general economy landscape in our markets is impacted by elevated inflation

rates, higher interest rates and energy supply risk for our stakeholders that

may impact our business negatively as projects may be cancelled or postponed. At

the same time the energy supply risk generates opportunities and Multiconsult is

expected to benefit from the expanding market associated with the green shift

and the rising demand for sustainable solutions - from all stakeholders. Overall

and supported by a diversified portfolio of ongoing projects and an all-time

high order backlog, Multiconsult is well-positioned going forward.

For a full review of outlook and report, please refer to our second quarter and

first half result 2023 report.

---

Presentations today 23 August 2023:

Participants are invited to attend the Norwegian presentation that will be held

at Hotel Continental, Stortingsgata 24/26, Oslo, at 08:30 (CEST).

The results will also be presented through a live webcast: In Norwegian at 08:30

and in English presentation at 09:30. Participants will have the opportunity to

submit questions online throughout the webcast sessions.

The Norwegian presentation at 08:30 can be accessed at:

https://channel.royalcast.com/landingpage/hegnarmedia/20230823_2/

The English presentation at 09:30 can be accessed at:

https://channel.royalcast.com/landingpage/hegnarmedia/20230823_3/

Live webcasts, complete report, presentation and a recording of the webcast will

be available on https://www.multiconsult-ir.com and https://newsweb.oslobors.no/

For further information, please contact:

Investor relations:

Ove B. Haupberg, CFO

Phone: +47 401 00 900

E-mail: oveb.haupberg@multiconsult.no

Media:

Gaute Christensen, VP Communications

Phone: +47 911 70 188

E-mail: gaute.christensen@multiconsult.no