Interim / Quarterly Report • Oct 30, 2023
Interim / Quarterly Report
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JANUARY – SEPTEMBER 2023
| MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Net sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
| Order intake | 135,1 | 264,8 | 681,7 | 920,7 | 869,6 | 1 108,6 |
| Order backlog | 1 066,9 | 1 460,8 | 1 066,9 | 1 460,8 | 1 066,9 | 1 274,7 |
| Adjusted Operating profif (EBITA) | 15,2 | 17,3 | 74,5 | 73,0 | 108,7 | 107,2 |
| Adjusted Operating margin (EBITA), % | 6,0 | 5,6 | 8,0 | 7,7 | 8,3 | 8,0 |
| Operating profit (EBITA) | 13,9 | 16,5 | 67,4 | 71,1 | 101,3 | 105,1 |
| Operating profit margin (EBITA), % | 5,5 | 5,3 | 7,3 | 7,5 | 7,7 | 7,9 |
| Operating profit (EBIT) | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Operating profit margin (EBIT), % | 4,8 | 5,1 | 6,7 | 7,3 | 7,3 | 7,7 |
| Net profit for the period | 5,6 | 10,7 | 39,9 | 50,1 | 66,0 | 76,2 |
| Operating cash flow | 19,9 | 104,2 | 2,3 | 122,2 | 80,4 | 200,3 |
| Earnings per share, SEK before dilution | 0,26 | 0,48 | 1,82 | 2,39 | 3,21 | 3,78 |
| Earnings per share, SEK, after dilution | 0,26 | 0,48 | 1,82 | 2,36 | 3,21 | 3,75 |
" Weak order intake during the quarter but continued great interest in our products. The need to take action on your balcony does not disappear. In the long run, an untreated balcony poses a danger to both the resident and those who move around the balcony. "
" Balco is entering a new market as we have taken our first order in Ireland with a value of approx. 3 MEUR. We assess that there is great potential in this market going forward within the new build segment. "
As expected, the quarter had a declining turnover, but we have managed to defend our profit margin in a good way. Order intake was weak as customers are still waiting and the decision-making process takes longer.
When we look back, most macroeconomists' expectations were that the Swedish key interest rate would peak in 2023 at 2.25 percent. The tenacious inflation has meant that the Riksbank has raised the key interest rate to 4 percent and will perhaps raise it somewhat further. There has been similar development in the euro area, Norway, Denmark and Great Britain. This has meant that the recovery in order intake that we had expected has been postponed.
Activity in inquiries and discussions about projects continued to increase in the third quarter. Our customers have started to get used to a higher interest rate, but the process leading up to a decision takes longer than before, as discussions with banks and potential advisors, among other things, often drag on. When it comes to housing associations in Scandinavia, Balco has a unique sales model where we support and help the associations also in these discussions with financial expertise, but currently these processes take longer due to the uncertainty that still prevails around when the central banks will be ready with their interest rate increases.
Balco has had a very good development in the UK market in the new build segment with our product Levitate. There is still a great need for housing in the UK, but also in Ireland. In the quarter, Balco took its first order in Ireland worth just over 3 MEUR. We see it as a first step in getting part of a market that is currently planning for 350 construction projects in Dublin containing balconies, where the balcony part of these projects has a value of up to 2,700 MSEK.
As an important step in our sustainability work and aim to be a leader in climate change in its industry, Balco Group has committed to developing short-term and long-term targets for emission reduction including net zero targets in line with the Science Based Targets initiative (SBTi). Through the undertaking, Balco Group will develop and report its targets, including a long-term net zero target, to SBTi for approval. We thus become part of the UNFCCC's Race to Zero campaign. The new and more ambitious targets will, upon approval, replace Balco Group's existing reduction targets for scope 1, 2 and parts of scope 3 until 2030.
We know that there is, and will be, a great need to renovate not only balconies, but also the entire surface layer of apartment buildings in the future, as approximately 40% of our entire energy needs are used to heat the homes. As previously informed, Balco will be part of this necessary transformation by being able to run turnkey projects where the glazed balcony is a trigger for the start-up of such a project.
To further strengthen this part, we in Norway have signed a cooperation agreement with a company that works to inform and sell these types of projects to housing associations. The founder has solid experience from both the balcony industry and larger transformation projects, and we see great potential in this collaboration going forward.
We have several ongoing acquisition discussions and receive various prospects on an ongoing basis which we evaluate. However, we are selective and focus on profitable companies that strategically strengthen our market position in existing markets as well as companies that strengthen our green transformation offer. Acquisition of balcony companies can also be interesting in new markets if we judge that the market has potential and that the companies are well managed and profitable.
The need for renovation of balconies remains. Postponing the measures will not improve the balconies. A balcony that is not renovated in time can pose a danger to the resident as well as to people moving around the balcony when chunks of concrete fall down. In the worst case, the balcony must be closed off and also the area around the balcony. This of course greatly affects the living environment, but also the property owner as it leads to the need to lower rents until the balcony is renovated. About 90 percent of Balco Group's turnover comes from the renovation segment, which means that we are convinced that order intake will start again in the future. In October, we received a large order in northern Sweden of more than 70 MSEK, which shows that projects are coming but the sales work is taking longer.
The lower order intake in the past year will affect turnover and earnings in the coming year. We continue to focus on costs to defend our profit margin and adjust to the organization based on changes in occupancy and order intake but retain important competence so that the company is not damaged in the long term. We still have good capacity in our factories and in our project organization, which will be needed when the market situation around interest rates and inflation has stabilized, and order intake picks up.
President and CEO
Net sales amounted to 253 MSEK (311). Acquired growth was 6 percent, currency effect was 2 percent and organic growth was -26 percent. Net sales for the renovation segment increased to 225 MSEK (284) and net sales for the New Build segment amounted to 28 MSEK (27).
Order intake amounted to 135 MSEK (265). The Renovation segment accounted for 82 MSEK (256) and the New Build segment accounted for 53 MSEK (9).
The order backlog amounted to 1,067 MSEK (1,461). The order backlog for the Renovation segment amounted to 899 MSEK (1,325) and the order backlog for the New Build segment amounted to 168 MSEK (136).
Gross profit amounted to 53 MSEK (61), entailing a gross margin of 21.1 percent (19.6).
Sales costs amounted to 25 MSEK (29) and administrative costs amounted to 17 MSEK (16). Items affecting comparability of 1 MSEK (1) were taken in the quarter linked to restructuring of the organization and acquisition costs.
Adjusted operating profit (EBITA) amounted to 15 MSEK (17), corresponding to an adjusted operating margin of 6.0 percent (5.6). Operating profit (EBITA) amounted to 14 MSEK (16), corresponding to an operating margin of 5.5 percent (5.3). Operating profit (EBIT) amounted to 12 MSEK (16), corresponding to an operating margin of 4.8 percent (5.1).
Net financial items amounted to -5 MSEK (-2), of which -0.4 MSEK (-0.5) refers to interest costs linked to right-to-use assets (leasing). Profit after tax amounted to 6 MSEK (11). Earnings per share increased to 0.26 SEK (0.48).
Operating cash flow amounted to 20 MSEK (104). The timing of building permits and the phases of the projects affect the cash flow between quarters.
Net sales amounted to 925 MSEK (950). Acquired growth was 6 percent, currency effect was 2 percent and organic growth was -11 percent. Net sales for the Renovation segment increased to 846 MSEK (836) and the net sales for New Build segment amounted to 79 MSEK (114).
The order intake amounted to 682 MSEK (921). The Renovation segment accounted for 570 MSEK (846) and the New Build segment accounted for 112 MSEK (75).
Gross profit amounted to 195 MSEK (211), entailing a gross margin of 21.1 percent (22.2). The gross result includes items affecting comparability of 4 MSEK (1) linked to restructuring costs. The adjusted gross profit was 199 MSEK (212) and the adjusted gross margin 21.5 percent (22.3). The gross margin has decreased due to an increased share of sales in low-margin markets and in subsidiaries with a lower gross margin. In addition, the gross margin is negatively affected by low occupancy within mainly production.
Sales costs amounted to 82 MSEK (93) and administrative costs amounted to 54 MSEK (49). Items affecting comparability of 3 MSEK (1) are taken in connection with restructuring of the organization and acquisition costs.
Adjusted operating profit (EBITA) amounted to 74 MSEK (73), corresponding to an adjusted operating margin of 8.0 percent (7.7). Operating profit (EBITA) amounted to 67 MSEK (71), corresponding to an operating margin of 7.3 percent (7.5). Operating profit (EBIT) amounted to 62 MSEK (69), corresponding to an operating margin of 6.7 percent (7.3).
Net financial items amounted to -10 MSEK (-5), of which -1.2 MSEK (-1.5) refers to interest costs linked to right-to-use assets (leasing). Interest costs have increased linked to higher market interest rates. Profit after tax amounted to 40 MSEK (50). Earnings per share amounted to 1.82 SEK (2.39).
Operating cash flow amounted to 2 MSEK (122). The timing of building permits and the phases of the projects affect the cash flow between quarters.
Adjusted operating profit R12
| Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|
|---|---|---|---|---|---|---|
| Tenant-owner associations | 130,5 | 225,3 | 599,7 | 680,1 | 872,5 | 952,9 |
| Private landlords | 30,1 | 9,8 | 79,2 | 47,6 | 95,0 | 63,5 |
| Publicly owned companies | 9,1 | 11,9 | 40,3 | 43,5 | 50,0 | 53,2 |
| Construction companies | 83,6 | 63,8 | 206,2 | 179,2 | 291,0 | 264,0 |
| Total net sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
Net sales per customer category, MSEK
| Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|
|---|---|---|---|---|---|---|
| Sweden | 148,3 | 189,0 | 585,8 | 588,8 | 832,6 | 835,6 |
| Other Scandinavia | 63,7 | 80,9 | 228,1 | 250,4 | 320,8 | 343,0 |
| Other Europe | 41,2 | 40,9 | 111,5 | 111,2 | 155,1 | 154,9 |
| Total net sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
Net sales amounted to 225 MSEK (284). The segment accounted for 89 percent of Balco's total net sales.
Order intake amounted to 82 MSEK (256), which corresponds to 61 percent of the total order intake.
The adjusted operating profit (EBITA) improved to 16 MSEK (15) corresponding to an adjusted operating margin of 7.1 percent (5.3). Operating profit (EBIT) improved to 14 MSEK (15), corresponding to an operating margin of 6.2 percent (5.1).
Net sales amounted to 846 MSEK (836). The segment accounted for 91 percent of Balco's total net sales.
Order intake amounted to 570 MSEK (846), which corresponds to 84 percent of the total order intake.
The adjusted operating profit improved to 72 MSEK (65) corresponding to an adjusted operating margin of 8.5 percent (7.7). Items affecting comparability are included with 5 MSEK (1) linked restructuring costs. Operating profit amounted to 62 MSEK (62), corresponding to an operating margin of 7.3 percent (7.5).
The order backlog amounted to 899 MSEK (1,325) which corresponds to 84 percent of the total order backlog.
| Renovation, MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Net sales | 225,0 | 284,2 | 846,3 | 836,5 | 1 173,3 | 1 163,5 |
| Adjusted Operating profit (EBITA) | 15,9 | 15,0 | 71,9 | 64,7 | 107,4 | 100,1 |
| Adhusted Operating margin (EBITA) | 7,1 | 5,3 | 8,5 | 7,7 | 9,1 | 8,6 |
| Order intake | 82,0 | 256,2 | 569,6 | 845,9 | 707,5 | 983,9 |
| Order backlog | 898,7 | 1 325,1 | 898,7 | 1 325,1 | 898,7 | 1 145,6 |
Net sales amounted to 28 MSEK (27). The segment accounted for 11 percent of Balco's total net sales.
Order intake amounted to 53 MSEK (9) which corresponds to 39 percent of the total order intake.
The adjusted operating profit (EBITA) amounted to 1.5 MSEK (1.5) corresponding to an adjusted operating margin of 5.1 percent (5.7).
Net sales amounted to 79 MSEK (114). The segment accounted for 9 percent of Balco's total net sales.
Order intake amounted to 112 MSEK (75) which corresponds to 16 percent of the total order intake.
The adjusted operating profit (EBITA) amounted to 3 MSEK (7) corresponding to an adjusted operating margin of 4.0 percent (6.5). The decrease is since the Maritime business, which in recent years has been the most profitable part of the New Build segment, no longer has any turnover.
The order backlog amounted to 168 MSEK (136), which corresponds to 16 percent of the total order backlog.
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Oct-Sep | Jan-Dec | |
|---|---|---|---|---|---|---|
| New Build, MSEK | 2023 | 2022 | 2023 | 2022 | 2022/23 | 2022 |
| Net sales | 28,3 | 26,6 | 79,1 | 113,9 | 135,3 | 170,1 |
| Adjusted Operating profit (EBITA) | 1,5 | 1,5 | 3,1 | 7,4 | 6,5 | 10,8 |
| Adhusted Operating margin (EBITA) | 5,1 | 5,7 | 4,0 | 6,5 | 4,8 | 6,3 |
| Order intake | 53,0 | 8,6 | 112,1 | 74,8 | 162,1 | 124,7 |
| Order backlog | 168,2 | 135,6 | 168,2 | 135,6 | 168,2 | 129,1 |
Interest-bearing net debt including leasing debt at the end of half-year period amounted to 223 MSEK (113). Interest-bearing net debt including leasing debt in relation to adjusted EBITDA amounted to 1.5 times (0.7).
Interest-bearing net debt excluding leasing debt amounted to 153 MSEK (32). Interest-bearing net debt excluding leasing debt in relation to adjusted EBITDA amounted to 1.1 times (0.2).
At the end of the half-year period, the Group's equity amounted to 758 MSEK (724).
The Group's equity ratio was 57 percent (51).
| MSEK | 30-sep 2023 |
30-sep 2022 |
31-dec 2022 |
|---|---|---|---|
| Non-current liabilities to credit institutions | 174,7 | 172,2 | 72,6 |
| Leasing liabilities non-current | 54,3 | 64,5 | 63,3 |
| Current liabilities to credit institutions | 0,4 | 0,4 | 0,8 |
| Leasing liabilities current | 14,8 | 16,4 | 20,0 |
| Cash and cash equivalents | -21,6 | -140,7 | -51,9 |
| Interest-bearing net debt incl leasing debt | 222,6 | 112,8 | 104,8 |
| Interest-bearing net debt excl leasing debt | 153,5 | 31,9 | 21,6 |
| Interest-bearing net debt incl. leasing/EBITDA (12 months), | |||
| times Interest-bearing net debt excl. leasing/EBITDA (12 months), |
1,5 x | 0,7 x | 0,7 x |
| times | 1,1 x | 0,2 x | 0,2 x |
| Equity/assets ratio, % | 57,5 | 51,3 | 56,3 |
For the interim period, cash flow from operating activities amounted to -44 MSEK (56).
Cash flow from investing activities amounted to -50 MSEK (-13), of which -2 MSEK (-8) was replacement investments and -9 MSEK (-5) expansion investments and -39 MSEK (0) acquisition of shares in subsidiaries.
Cash flow from financing activities amounted to 62 MSEK (-22) where the largest items refer to dividends paid of -16 MSEK (-22) and increased utilization of the revolving credit facility of 100 MSEK (0).
Cash flow for the interim period amounted to -31 MSEK (22).
Depreciation for the interim period amounted to 33 MSEK (26), of which 15 MSEK (15) refers to depreciation linked to right-to-use assets (leasing) and 5 MSEK (2) refers to amortization of acquired intangible assets.
The Parent Company has its registered office in Växjö and conducts operations directly as well as through Swedish and foreign subsidiaries. The Parent Company's operations are focused primarily on strategic development, financial control, corporate governance issues, board work and relations with banks.
The operating result for the interim period amounted to 4 MSEK (4).
57 %
Balco Group is a market-leading player in the balcony industry and offers a range of different services, from development and manufacturing to sales and installation of self-made open and glazed balcony systems. Balco has a unique method, known as the Balco Method, for delivering glazed balconies and balcony solutions. The method means that existing balconies are removed and replaced with new, larger glazed balconies with a lifespan of over 90 years, which provides the market's most economical and sustainable solution.
In order to offer complete and customized solutions in the balcony industry, Balco Group has several subsidiaries that work together to offer a comprehensive solution in areas such as manufacturing and delivery of balconies, masonry and tiling services, technical solutions and facade services such as renovation, window replacement and facade cleaning. Balco Group strives to meet customer needs and requirements by offering a combination of specialized services and expertise. Balco Group's offer contributes to increased quality of life, safety and value for residents in apartment buildings and provides energy savings up to 30 percent. The group takes full responsibility for the project and guides the customer through the entire process from project planning to final inspection and service.
ing balconies as well as the installation of new balconies on multi-residential properties, mainly glazed balconies. The main driving force is the pent-up need for renovation and the age profile of the properties. The offer also includes facade renovation in connection with balcony projects.
The segment includes balconies in the construction of multi-residential properties as well as balcony projects in the maritime market. Largest product areas are balcony glazing and open balconies. Balco expands selectively with a focus on profitability and low risk. Demand is driven by the pace of new housing production.
Sustainability is a prerequisite for long-term profitability for the Balco Group. By focusing on sustainability, we can create a strong brand, increase customer trust and improve our competitiveness in the long term. We will continue to work hard to incorporate sustainability into all aspects of our business.
Sustainability is a focus area in the construction industry and affects all links in the value chain. This particularly applies to the market for balconies where Balco Group operates. Property developers and property owners demand economically advantageous and climate-smart solutions with a long lifespan.
As an important step in our sustainability work and aim to be a leader in climate change in its industry, Balco Group has committed to developing short-term and long-term targets for emission reduction including net zero targets in line with the Science Based Targets initiative (SBTi).
At the end of September 2023 Balco had 501 (518) full-time employees.
Balco's sales and earnings are partially affected by the date when orders are placed, seasonal variations and the fact that the annual general meetings of tenant-owner associations normally take place in the second and fourth quarter. In addition, the Group is positively affected by months with a large number of workdays and lack of absences, and somewhat negatively affected by weather factors, when winters with significant volumes of snow entail increased costs.
At the end of September 2023, there were 21,909,348 shares in Balco, corresponding to a share capital of 131,461,248 SEK. There were 5,636 shareholders. The five largest shareholders were The Family Hamrin, Skandrenting AB, Swedbank Robur fonder, Lannebo Fonder and Tredje AP-fonden.
Related parties comprise the Board of Directors, Group management and the CEO. This is due to ownership stakes in Balco and positions as senior executives. Related parties also include the Company's largest shareholder, The Family Hamrin that is represented on the Board of Directors by Carl-Mikael Lindholm and Skandrenting that is represented on the Board of Directors by Johannes Nyberg. Related-party transactions take place on commercial terms. For further information, see pages 112 and 133 in the 2022 Annual Report.
Balco Group AB has three long-term incentive programs aimed at the company's senior executives and additional key employees, a total of 50 employees. The incentive programs comprise a total of no more than 820,000 warrants, which entitles to a maximum of new subscriptions of the corresponding number of shares. Balco's total cost for the incentive programs during the term of the programs is expected to amount to approximately 6 MSEK. The programs involve a dilution corresponding to approximately 4 percent of the company's total number of shares. The senior executives in Balco have acquired 233,332 warrants amounting to a total value of 2,180,784 SEK. The purpose of the incentive programs is to encourage broad shareholding among Balco's employees, facilitate recruitment, retain competent employees and increase motivation to achieve or exceed the company's financial goals. For more information, see the Annual Report 2022 on pages 58-59, 90 and 110-111.
Through its operations, the Group and the Parent Company is exposed to various types of risks. The risks can be divided into industry and market-related risks, business-related risks and financial risks. Industry and market-related risks include changes in demand because of a weaker economy or other macroeconomic changes, a changed price picture for raw materials that are central to Balco's production, and a change in competition or price pressure. Business-related risks include Balco's ability to develop and sell new innovative products and solutions, that the Group can attract and retain qualified employees and that Balco's profitability depends on the results of the individual projects, i.e., the Group's ability to anticipate, calculate and deliver projects. The financial risks are summarized under financing risk, liquidity risk, credit risk and interest rate risk. Balco's risks and uncertainties are described on pages 70-77, 85, 120-121, 124 and 127 in the Annual Report for 2022.
Balco Group is one of the few complete balcony suppliers on the market that provides customized and innovative balcony solutions on a turnkey basis. Balco Group is the market leader in Scandinavia and has a strong challenger position in other markets in which the Group operates. The market is fragmented and growing throughout northern Europe. The value of the balcony market in the countries where Balco Group is represented is estimated at just over 40 billion SEK.
Our financial position means that the company is equipped for growth through selective acquisitions that strengthen our market position in existing markets. The timing of building permits affects cash flow between quarters. The lower order intake in the past year will affect sales and earnings in the coming year. We continue to focus on costs to defend our profit margin and make adjustments to the organization based on changes in occupancy and order intake but retain important competence so that the company is not damaged in the long term.
In October, Balco has received an order of more than 70 MSEK in Northern Sweden.
Balco has received its first order in Ireland with a value of just over 3 MEUR.
Balco Group has joined the Science Based Targets initiative.
Balco Group has prolonged its RCF with Danske Bank with two years and it is now valid until October 12, 2026.
Balco shall achieve growth of 10 percent per year during a business cycle.
Earnings per share shall grow by 20 percent per year during a business cycle.
Interest-bearing net debt shall not exceed 2.5 times operating profit before depreciation and amortization (EBITDA), other than temporarily.
Balco shall distribute 30-50 percent of profit after tax, taking into consideration the needs for Balco's long-term growth and prevailing market conditions.
The interim report has been subject to a review of ISRE 2410 by the company's auditors.
This information comprises such information as Balco Group AB is obliged to publish in accordance with the EU Market Abuse Regulation. The information was provided by the contact person below for publication on 30 October 2023 at 13:00 CET.
Camilla Ekdahl President and CEO
Web conference
A webcast conference call will be held at 14:00 CET October 30, 2023, where CEO and President Camilla Ekdahl and CFO Michael Grindborn will present the report and answer questions.
To follow the webcast presentation and send written questions, please use this link: https://www.finwire.tv/webcast/balcogroup/balco-group-q3-presentation-2023/
To participate via teleconference and be able to ask questions, call in:
SE: +46 8 5050 0829 PIN: 859 7363 6769#
Camilla Ekdahl, President and CEO, Tel: +46 70 606 30 32, [email protected] Michael Grindborn, CFO and Head of IR, Tel: +46 70 670 18 48, [email protected]
Year-end report Jan-Dec 2023 February 5, 2024 Interim report Jan-Mar 2024 April 29, 2024 Annual General Meeting 2024 May 14, 2024 Interim report Jan-Jun 2024 July 12, 2024 Interim report Jan-Sep 2024 October 28, 2024
| MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Net sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
| Production and project costs | -199,9 | -249,9 | -730,5 | -739,6 | -1 036,8 | -1 046,0 |
| Gross profit | 53,4 | 60,9 | 194,9 | 210,7 | 271,8 | 287,6 |
| Sales costs | -25,3 | -28,8 | -81,5 | -92,6 | -115,4 | -126,4 |
| Administration costs | -17,2 | -16,2 | -54,3 | -49,1 | -76,2 | -71,0 |
| Other operating income | 1,4 | -0,0 | 3,5 | 0,4 | 15,4 | 12,3 |
| Other operating expenses | -0,1 | - | -0,2 | - | -0,2 | -0,0 |
| Operating costs | -41,1 | -45,0 | -132,6 | -141,3 | -176,4 | -185,1 |
| Operating profit | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Finance income | 0,9 | 0,2 | 2,7 | 0,3 | 3,4 | 1,0 |
| Finance costs | -5,8 | -2,2 | -12,7 | -5,8 | -15,7 | -8,8 |
| Profit before tax | 7,3 | 14,0 | 52,4 | 63,9 | 83,0 | 94,6 |
| Income tax | -1,7 | -3,3 | -12,4 | -13,8 | -17,1 | -18,5 |
| Net profit for the period | 5,6 | 10,7 | 39,9 | 50,1 | 66,0 | 76,2 |
| Other comprehensive income | ||||||
| Items that may later be reclassified to the income statement | ||||||
| Translation difference when translating foreign operations | -4,5 | -0,1 | 3,4 | 2,3 | 8,0 | 6,9 |
| Comprehensive income for the period | 1,1 | 10,5 | 43,4 | 52,4 | 74,0 | 83,1 |
| Of which attributable to: | ||||||
| Parent company's shareholders | 0,8 | 10,5 | 43,2 | 52,4 | 73,5 | 82,8 |
| Non-controlling interest | 0,3 | - | 0,2 | - | 0,5 | 0,3 |
| Comprehensive income for the period | 1,1 | 10,5 | 43,4 | 52,4 | 74,0 | 83,1 |
| Earnings per share, SEK, before dilution | 0,26 | 0,48 | 1,82 | 2,39 | 3,21 | 3,78 |
| Earnings per share, SEK, after dilution | 0,26 | 0,48 | 1,82 | 2,36 | 3,21 | 3,75 |
| Average number of shares before dilution, thousands | 21 909 | 21 909 | 21 909 | 21 909 | 21 909 | 21 909 |
| Average number of shares after dilution, thousands | 21 909 | 21 909 | 21 909 | 21 909 | 21 909 | 22 106 |
| MSEK 2023 2022 2022 ASSETS Non-current assets Intangible assets Goodwill 485,4 448,4 457,8 Other intangible assets 142,2 109,0 135,3 Total intangible assets 627,6 557,4 593,1 Tangible assets Right-to-use assets 67,8 80,0 82,3 Property, plant and equipment 162,9 153,6 158,8 Total tangible assets 230,6 233,6 241,1 Deferred tax assets 0,7 0,1 1,0 Total non-current assets 858,9 791,2 835,2 Current assets Inventory 58,6 60,6 58,4 Accounts receivables 158,6 229,8 174,8 Contract assets 156,2 114,9 111,9 Current tax receivables 42,2 33,7 22,0 Other current receivables 20,5 39,6 42,4 Cash and cash equivalents 21,6 140,7 51,9 Total current assets 457,8 619,3 461,4 TOTAL ASSETS 1 316,7 1 410,5 1 296,6 EQUITY AND LIABILITIES Equity Share capital 131,5 131,5 131,5 Other capital contributions 406,3 406,3 406,3 Reserves 11,7 3,7 8,3 Retained earnings, incl. profit for year 207,0 182,3 183,7 Equity attributable to Parent Company's shareholders 756,5 723,7 729,8 Non-controlling interest 1,4 - 1,2 TOTAL EQUITY 757,9 723,7 731,0 LIABILITIES Non-current liabilities Liabilities to credit institutions 174,7 172,2 72,6 Leasing liabilities 54,3 64,5 63,3 Other non-current liabilities 13,8 29,0 18,4 Deferred tax liabilities 42,1 32,6 40,0 Total non-current liabilities 284,9 298,3 194,3 Current liabilities Liabilities to credit institutions 0,4 0,4 0,8 Leasing liabilities 14,8 16,4 20,0 Contract liabilities 70,3 135,5 124,9 Accounts payables 101,7 139,1 122,8 Current tax liabilities 4,2 4,5 3,6 Other current liabilities 31,0 36,8 38,2 Accrued expenses and prepaid income 51,4 55,8 61,1 |
30-sep | 30-sep | 31-dec |
|---|---|---|---|
| Total current liabilities 273,9 388,5 371,3 |
|||
| TOTAL EQUITY AND LIABILITIES 1 316,7 1 410,5 1 296,6 |
| earnings | |||||||
|---|---|---|---|---|---|---|---|
| including | |||||||
| Additional | comprehensive | Non | |||||
| Share | paid-in | income for the | controlling | Total | |||
| MSEK | Capital | capital Reserves | year | interest | equity | ||
| Opening balance 1 Jan 2022 | 131,5 | 405,1 | 1,3 | 154,1 | - | 692,0 | |
| Comprehensive income for the period | |||||||
| Profit for the period | - | - | - | 50,1 | - | 50,1 | |
| Other comprehensive income for the period | - | - | 2,3 | - | - | 2,3 | |
| Total comprehensive income for the period | - | - | 2,3 | 50,1 | - | 52,4 | |
| Acquisitiom of non-controlling interest | - | - | - | - | - | - | |
| Transactions with shareholders: | |||||||
| Distributed dividend | - | - | - | -21,9 | - | -21,9 | |
| New warrants issue | - | 1,2 | - | - | - | 1,2 | |
| Total transactions with Company owners | - | 1,2 | - | -21,9 | - | -20,7 | |
| Closing balance 30 Sep 2022 | 131,5 | 406,3 | 3,7 | 182,3 | - | 723,7 | |
| Opening balance 1 Jan 2023 | 131,5 | 406,3 | 8,3 | 183,7 | 1,2 | 731,0 | |
| Comprehensive income for the period | |||||||
| Profit for the period | - | - | - | 39,7 | 0,2 | 39,9 | |
| Other comprehensive income for the period | - | - | 3,4 | - | - | 3,4 | |
| Total comprehensive income for the period | - | - | 3,4 | 39,7 | 0,2 | 43,4 | |
| Acquisitiom of non-controlling interest | - | - | - | - | - | - | |
| Transactions with shareholders: | |||||||
| Distributed dividend | - | - | - | -16,4 | - | -16,4 | |
| New warrants issue | - | - | - | - | - | ||
| Total transactions with Company owners | - | - | - | -16,4 | - | -16,4 | |
| Closing balance 30 Sep 2023 | 131,5 | 406,3 | 11,7 | 207,0 | 1,4 | 757,9 |
| MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Operating activities | ||||||
| Operating profit (EBIT) | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Adjustment for non-cash items | 8,9 | 4,5 | 34,0 | 13,4 | 52,8 | 32,2 |
| Interest received | 0,9 | 0,2 | 2,7 | 0,6 | 3,1 | 1,0 |
| Interest paid | -5,5 | -2,2 | -11,5 | -5,6 | -12,9 | -7,0 |
| Income tax paid | -7,4 | -13,9 | -32,4 | -49,4 | -24,0 | -41,0 |
| Cash flow from operating activities before changes in | ||||||
| working capital | 9,2 | 4,5 | 55,1 | 28,4 | 114,4 | 87,7 |
| Changes in working capital | ||||||
| Increase (-)/Decrease (+) in inventories | 0,8 | 2,4 | 0,2 | -7,2 | 2,8 | -4,6 |
| Increase (-)/Decrease (+) in current assets | 10,0 | 28,7 | 7,5 | -54,3 | 64,7 | 2,9 |
| Increase (+)/Decrease (-) in current liabilities | -14,0 | 47,7 | -106,4 | 89,7 | -129,0 | 67,1 |
| Cash flow from operating activities | 5,9 | 83,4 | -43,6 | 56,5 | 53,0 | 153,0 |
| Cash flow from investing activities | ||||||
| Investments in intangible fixed assets | -0,5 | -0,0 | -3,5 | -0,2 | -10,6 | -7,2 |
| Investments in tangible fixed assets | -1,4 | -3,4 | -6,8 | -12,9 | -10,8 | -16,9 |
| Acquisitions of operations | - | - | -39,5 | - | -68,0 | -28,5 |
| Changes in other non-current assets/liabilities | - | -2,1 | - | -1,8 | 1,8 | - |
| Cash flow from investing activities | -1,9 | -3,3 | -49,8 | -12,6 | -89,8 | -52,6 |
| Cash flow from financing activities | ||||||
| Changes in bank loans | -5,0 | 49,9 | 94,4 | -0,3 | -4,9 | -99,7 |
| Changes in leasing | -4,0 | 0,3 | -15,7 | -1,2 | -39,9 | -25,4 |
| New warrants issue | - | 1,2 | 0,0 | 1,2 | 0,0 | 1,2 |
| Distributed dividend | - | - | -16,4 | -21,9 | -38,3 | -43,8 |
| Cash flow from financing activities | -9,0 | 51,4 | 62,3 | -22,2 | -83,1 | -167,7 |
| Cash flow for the period | -5,0 | 131,5 | -31,1 | 21,6 | -120,0 | -67,3 |
| Cash and cash equivalents at beginning of the period | 27,5 | 8,4 | 51,9 | 117,5 | 140,7 | 117,5 |
| Exchange rate differential cash and cash equivalents | -0,9 | 0,8 | 0,8 | 1,6 | 0,9 | 1,6 |
| Cash and cash equivalents at end of the period | 21,6 | 140,7 | 21,6 | 140,7 | 21,6 | 51,9 |
| MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Net sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
| Order intake | 135,1 | 264,8 | 681,7 | 920,7 | 869,6 | 1 108,6 |
| Order backlog | 1 066,9 | 1 460,8 | 1 066,9 | 1 460,8 | 1 066,9 | 1 274,7 |
| Gross profit | 53,4 | 60,9 | 194,9 | 210,7 | 271,8 | 287,6 |
| Adjusted Gross Profit | 53,4 | 60,9 | 198,7 | 211,8 | 279,5 | 292,6 |
| EBITDA | 22,3 | 26,3 | 95,7 | 99,8 | 140,4 | 144,5 |
| Adjusted EBITDA | 23,5 | 27,2 | 102,8 | 101,7 | 147,7 | 146,6 |
| Operating profit (EBITA) | 13,9 | 16,5 | 67,4 | 71,1 | 101,3 | 105,1 |
| Adjusted operating profit (EBITA) | 15,2 | 17,3 | 74,5 | 73,0 | 108,7 | 107,2 |
| Operating profit (EBIT) | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Adjusted operating profit (EBIT) | 13,5 | 16,8 | 69,4 | 71,3 | 102,7 | 104,6 |
| Gross profit margin, % | 21,1 | 19,6 | 21,1 | 22,2 | 20,8 | 21,6 |
| Adjusted gross margin, % | 21,1 | 19,6 | 21,5 | 22,3 | 21,4 | 21,9 |
| EBITDA margin, % | 8,8 | 8,5 | 10,3 | 10,5 | 10,7 | 10,8 |
| Adjusted EBITDA margin, % | 9,3 | 8,7 | 11,1 | 10,7 | 11,3 | 11,0 |
| Operating profit margin (EBITA), % | 5,5 | 5,3 | 7,3 | 7,5 | 11,7 | 9,5 |
| Adjusted operating profit margin (EBITA), % | 6,0 | 5,6 | 8,0 | 7,7 | 10,2 | 8,4 |
| Operating profit margin (EBIT), % | 4,8 | 5,1 | 6,7 | 7,3 | 7,3 | 7,7 |
| Adjusted operating profit margin (EBIT), % | 5,3 | 5,4 | 7,5 | 7,5 | 7,9 | 7,8 |
| Operating cash flow | 19,9 | 104,2 | 2,3 | 122,2 | 80,4 | 200,3 |
| Operating cash conversion, % | 84,6 | 383,7 | 2,2 | 120,2 | 54,4 | 136,6 |
| Capital employed, average | 978,9 | 874,5 | 906,9 | 812,8 | 907,8 | 811,8 |
| Capital employed, excl. goodwill, average | 493,4 | 426,2 | 435,2 | 364,6 | 440,9 | 358,9 |
| Equity, average | 756,1 | 717,9 | 743,2 | 707,9 | 740,1 | 710,9 |
| Interest-bearing net debt incl leasing debt | 222,6 | 112,8 | 222,6 | 112,8 | 222,6 | 104,8 |
| Interest-bearing net debt excl leasing debt | 153,5 | 31,9 | 153,5 | 31,9 | 153,5 | 21,6 |
| Interest-bearing net debt incl. leasing/Adjusted EBITDA 12 months, times |
1,5 | 0,7 | 1,5 | 0,7 | 1,5 | 0,7 |
| Interest-bearing net debt excl. leasing/EBITDA (12 months), times |
1,1 | 0,2 | 1,1 | 0,2 | 1,1 | 0,2 |
| Return on capital employed, %, (12 months) | 11,1 | 12,8 | 11,3 | 13,5 | 11,3 | 12,9 |
| Return on capital employed, excl. goodwill, %, (12 months) | 22,0 | 26,2 | 23,6 | 30,0 | 23,3 | 29,2 |
| Return on invested capital, %, (12 months) | 8,7 | 11,1 | 8,9 | 11,3 | 8,9 | 10,7 |
| Equity/assets ratio, % | 57,5 | 51,3 | 56,9 | 53,3 | 54,3 | 55,9 |
| Number of full-time employees on the closing date | 501 | 518 | 501 | 518 | 501 | 536 |
| Average number of shares before dilution, thousands | 21 909 | 21 909 | 21 909 | 21 909 | 21 909 | 21 909 |
| Average number of shares after dilution, thousands | 21 909 | 21 909 | 21 909 | 22 116 | 21 909 | 22 106 |
| Equity per share, SEK | 34,51 | 32,77 | 33,92 | 32,01 | 33,78 | 32,16 |
| MSEK | Jul-Sep 2023 |
Jul-Sep 2022 |
Jan-Sep 2023 |
Jan-Sep 2022 |
Oct-Sep 2022/23 |
Jan-Dec 2022 |
|---|---|---|---|---|---|---|
| Net sales | 6,2 | 6,5 | 18,4 | 19,4 | 24,9 | 26,0 |
| Administrative expenses | -3,9 | -5,7 | -13,3 | -15,2 | -22,3 | -24,2 |
| Operating profit | 2,3 | 0,7 | 5,1 | 4,3 | 2,6 | 1,8 |
| Interest income and similar profit/loss items | 0,8 | 0,9 | 4,0 | 1,9 | 5,4 | 3,3 |
| Interest expenses and similar profit/loss items | -5,0 | -2,1 | -14,4 | -4,2 | -18,2 | -8,1 |
| Dividend / result from group companies | - | - | 12,7 | - | 12,7 | - |
| Profit/loss after financial items | -2,0 | -0,4 | 7,3 | 1,9 | 2,5 | -2,9 |
| Appropriations | - | - | - | - | 62,0 | 62,0 |
| Tax | 0,4 | 0,1 | 1,1 | -0,4 | -10,8 | -12,3 |
| Net profit/loss for the period | -1,6 | -0,3 | 8,4 | 1,5 | 53,7 | 46,8 |
In the Parent Company there are no items that are reported as other comprehensive income, so total comprehensive income is consistent with the profit for the period.
| MSEK | 30-sep 2023 |
30-sep 2022 |
31-dec 2022 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Financial assets | |||
| Shares in group companies | 745,7 | 683,2 | 702,5 |
| Other non-current assets | 2,9 | 3,2 | 3,1 |
| Total non-current assets | 748,5 | 686,4 | 705,5 |
| Current assets | |||
| Receivables from group companies | 154,7 | 122,3 | 126,3 |
| Other current receivables | 39,1 | 27,4 | 25,7 |
| Cash and cash equivalents | 14,0 | 139,3 | 46,3 |
| Total current assets | 207,8 | 289,0 | 198,3 |
| TOTAL ASSETS | 956,4 | 975,4 | 903,8 |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Restricted equity | 131,5 | 131,5 | 131,5 |
| Non-restricted equity | 333,2 | 317,8 | 341,2 |
| Total equity | 464,7 | 449,3 | 472,7 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Liabilities to credit institutions | 150,0 | 150,0 | 50,0 |
| Other non-current liabilities | 15,8 | 31,6 | 20,3 |
| Total non-current liabilities | 165,8 | 181,6 | 70,3 |
| Current liabilities | |||
| Liabilities to group companies | 316,1 | 338,8 | 352,0 |
| Other current liabilities | 9,8 | 5,7 | 8,8 |
| Total current liabilities | 325,9 | 344,5 | 360,8 |
| TOTAL EQUITY AND LIABILITIES | 956,4 | 975,4 | 903,8 |
This summary consolidated interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and relevant provisions of the Swedish Annual Accounts Act. The interim report for the Parent Company has been prepared in accordance with RFR 2 and Chapter 9, Interim Reports, of the Swedish Annual Accounts Act. For both the Parent Company and the Group, the same accounting policies and computation methods have been applied as in the 2022 Annual Report, which was prepared in accordance with International Financial Reporting Standards and Interpretations as adopted by the EU. The information on pages 1-9 relating to the part of the year covered by this interim report constitutes an integral part of this financial report.
The financial instruments measured at fair value are forward exchange contracts. Financial assets at fair value amounted to 0.7 MSEK (0.9) at the end of the period while financial liabilities at fair value amounted to 1.0 MSEK (0.8). The fair values of financial instruments are determined using valuation techniques. Market information is used as far as possible when available, while company-specific information is used as little as possible. If all key inputs required for the fair value measurement of an instrument are observable, the instrument is categorized in level 2. Reported value of trade receivables, other receivables, cash and cash equivalents, trade payables and other liabilities constitutes a reasonable approximation of fair value.
Balco reports the following segments:
| Jul-Sep | Renovation | New Build | Group-wide | Eliminations | Total | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
| Net sales – External revenue | 225,0 | 284,2 | 28,3 | 26,6 | - | - | - | - | 253,3 | 310,8 |
| Net sales – Internal revenue | - | - | - | - | 6,2 | 19,8 | -6,2 | -19,8 | - | - |
| Total sales | 225,0 | 284,2 | 28,3 | 26,6 | 6,2 | 19,8 | -6,2 | -19,8 | 253,3 | 310,8 |
| Operating profit (EBIT) | 14,1 | 14,6 | 1,5 | 1,4 | -3,3 | -0,0 | - | - | 12,3 | 16,0 |
| Depreciation included with | 9,8 | 9,0 | 0,2 | 1,3 | - | - | - | - | 10,0 | 10,4 |
| of which amortization | 1,7 | 0,4 | - | 0,1 | - | - | - | - | 1,7 | 0,5 |
| Items affecting comparison | 0,2 | - | - | - | 1,0 | 0,8 | - | - | 1,2 | 0,8 |
| Adjusted operating profit (EBITA) | 15,9 | 15,0 | 1,5 | 1,5 | -2,2 | 0,8 | - | - | 15,2 | 17,3 |
| Adjusted operating margin | 7,1% | 5,3% | 5,1% | 5,7% | 6,0% | 5,6% | ||||
| Operating profit (EBIT) | 14,1 | 14,6 | 1,5 | 1,4 | -3,3 | -0,0 | - | - | 12,3 | 16,0 |
| Finance income | - | - | - | - | 0,9 | 0,2 | - | - | 0,9 | 0,2 |
| Finance cost | - | - | - | - | -5,8 | -2,2 | - | - | -5,8 | -2,2 |
| Profit before tax | 14,1 | 14,6 | 1,5 | 1,4 | -8,2 | -2,0 | - | - | 7,3 | 14,0 |
| Jan-Sep | Renovation | New Build | Group-wide Eliminations |
Total | ||||||
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
| Net sales – External revenue | 846,3 | 836,5 | 79,1 | 113,9 | - | - | - | - | 925,4 | 950,4 |
| Net sales – Internal revenue | - | - | - | - | 18,4 | 33,1 | -18,4 | -33,1 | - | - |
| Total sales | 846,3 | 836,5 | 79,1 | 113,9 | 18,4 | 33,1 | -18,4 | -33,1 | 925,4 | 950,4 |
| Operating profit (EBIT) | 61,9 | 62,5 | 3,0 | 7,1 | -2,5 | -0,2 | - | - | 62,3 | 69,4 |
| Depreciation included with | 31,2 | 26,1 | 2,2 | 4,3 | - | - | - | - | 33,4 | 30,4 |
| of which amortization | 4,9 | 1,5 | 0,2 | 0,2 | - | - | - | - | 5,1 | 1,7 |
| Items affecting comparison | 5,1 | 0,8 | - | - | 1,9 | 1,0 | - | - | 7,0 | 1,8 |
| Adjusted operating profit (EBITA) | 71,9 | 64,7 | 3,1 | 7,4 | -0,6 | 0,9 | - | - | 74,5 | 73,0 |
| Adjusted operating margin (EBITA) | 8,5% | 7,7% | 4,0% | 6,5% | 8,0% | 7,7% | ||||
| Operating profit (EBIT) | 61,9 | 62,5 | 3,0 | 7,1 | -2,5 | -0,2 | - | - | 62,3 | 69,4 |
| Finance income | - | - | - | - | 2,7 | 0,3 | - | - | 2,7 | 0,3 |
| Finance cost | - | - | - | - | -12,7 | -5,8 | - | - | -12,7 | -5,8 |
Balco's financial statements include alternative performance measures, which complement the measures that are defined or specified in applicable rules for financial reporting. Alternative performance measures are presented since, as in their context, they provide clearer or more in-depth information than the measures defined in applicable rules for financial reporting. The alternative performance measures are derived from the Company's consolidated financial reporting and are not measured in accordance with IFRS.
| MSEK | 30-sep 2023 |
30-sep 2022 |
31-dec 2022 |
|---|---|---|---|
| Interest-bearing net debt incl leasing debt | |||
| Non-current interest-bearing liabilities | 229,0 | 236,7 | 135,9 |
| Current interest-bearing liabilities | 15,1 | 16,8 | 20,7 |
| Cash and cash equivalents | -21,6 | -140,7 | -51,9 |
| Interest-bearing net debt incl leasing debt | 222,6 | 112,8 | 104,8 |
| Adjusted EBITDA (R12) | 147,7 | 150,8 | 146,6 |
| Interest-bearing net debt/EBITDA (R12), times | 1,5 | 0,7 | 0,7 |
| Interest-bearing net debt excl leasing debt | |||
| Interest-bearing net debt incl leasing debt | 222,6 | 112,8 | 104,8 |
| Leasing liabilities non-current | -54,3 | -64,5 | -63,3 |
| Leasing liabilities current | -14,8 | -16,4 | -20,0 |
| Interest-bearing net debt excl leasing debt | 153,5 | 31,9 | 21,6 |
| Interest-bearing net debt/EBITDA excl leasing (R12), times | |||
| Adjusted EBITDA (R12) | 147,7 | 150,8 | 146,6 |
| Leasing depreciations (R12) | -3,9 | -20,0 | -23,4 |
| Adjusted EBITDA (R12) excl leasing depreciations | 143,8 | 130,8 | 123,2 |
| Interest-bearing net debt/EBITDA excl leasing (R12), times | 1,1 | 0,2 | 0,2 |
| Return on capital employed | |||
| Equity | 756,5 | 723,7 | 729,8 |
| Interest-bearing net debt | 222,6 | 112,8 | 104,8 |
| Average capital employed | 907,8 | 835,0 | 811,8 |
| Adjusted operating profit (EBIT), (R12) | 102,7 | 109,3 | 104,6 |
| Return on capital employed, % | 11,3 | 13,1 | 12,9 |
| Equity/assets ratio | |||
| Equity attributable to owners of the parent company | 756,5 | 723,7 | 729,8 |
| Total assets | 1 316,7 | 1 410,5 | 1 296,6 |
| Equity/assets ratio, % | 57,5 | 51,3 | 56,3 |
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Oct-Sep | Jan-Dec | |
|---|---|---|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 | 2022 | 2022/23 | 2022 |
| Adjusted operating profit (EBIT) | ||||||
| Operating profit (EBIT | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Items affecting comparison | ||||||
| Adjustment of earn-out | - | - | - | - | -10,7 | -10,7 |
| Re-structuring costs | 0,2 | 0,8 | 5,1 | 1,6 | 15,9 | 12,3 |
| Acquisition costs | 1,0 | 0,0 | 1,9 | 0,3 | 2,1 | 0,5 |
| Adjusted operating profit (EBIT) | 13,5 | 16,8 | 69,4 | 71,3 | 102,7 | 104,6 |
| Operating profit (EBITA) | - | - | - | - | - | - |
| Operating profit (EBIT) | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Amortization | 1,7 | 0,5 | 5,1 | 1,7 | 5,9 | 2,6 |
| Operating profit (EBITA) | 13,9 | 16,5 | 67,4 | 71,1 | 101,3 | 105,1 |
| Adjusted operating profit (EBITA) | - | - | - | - | - | - |
| Adjusted operating profit (EBIT) | 13,5 | 16,8 | 69,4 | 71,3 | 102,7 | 104,6 |
| Amortization | 1,7 | 0,5 | 5,1 | 1,7 | 5,9 | 2,6 |
| Adjusted operating profit (EBITA) | 15,2 | 17,3 | 74,5 | 73,0 | 108,7 | 107,2 |
| EBITDA | ||||||
| Operating profit (EBIT) | 12,3 | 16,0 | 62,3 | 69,4 | 95,4 | 102,5 |
| Depreciation and amortization | 10,0 | 10,4 | 33,4 | 30,4 | 45,0 | 42,0 |
| EBITDA | 22,3 | 26,3 | 95,7 | 99,8 | 140,4 | 144,5 |
| Adjusted EBITDA | ||||||
| Adjusted operating profit (EBIT) | 13,5 | 16,8 | 69,4 | 71,3 | 102,7 | 104,6 |
| Depreciation and amortization | 10,0 | 10,4 | 33,4 | 30,4 | 45,0 | 42,0 |
| Adjusted EBITDA | 23,5 | 27,2 | 102,8 | 101,7 | 147,7 | 146,6 |
| Investments, excluding expansion investments | ||||||
| Investments in intangible fixed assets | -0,5 | -0,0 | -3,5 | -0,2 | -10,6 | -7,2 |
| Investments in tangible fixed assets | -1,4 | -3,4 | -6,8 | -12,9 | -10,8 | -16,9 |
| of which expansion investments | 1,9 | 1,0 | 8,7 | 4,9 | 15,9 | 12,1 |
| Investments, excluding expansion investments | - | -2,4 | -1,6 | -8,1 | -5,5 | -12,0 |
| Operating cash flow | ||||||
| Adjusted EBITDA | 23,5 | 27,2 | 102,8 | 101,7 | 147,7 | 146,6 |
| Changes in working capital | -3,6 | 79,4 | -98,9 | 28,7 | -61,9 | 65,7 |
| Investments, excluding expansion investments | - | -2,4 | -1,6 | -8,1 | -5,5 | -12,0 |
| Operating cash flow | 19,9 | 104,2 | 2,3 | 122,2 | 80,4 | 200,3 |
| Net Sales excluding acquisitions | ||||||
| Net Sales | 253,3 | 310,8 | 925,4 | 950,4 | 1 308,6 | 1 333,6 |
| Acquired net sales | -18,1 | - | -58,2 | -33,4 | -71,4 | -46,6 |
| Net Sales excluding acquisitions | 235,1 | 310,8 | 867,2 | 917,0 | 1 237,1 | 1 287,0 |
On March 2, 2023, Balco entered into an agreement for the acquisition of all shares in NMT Montageteknik i Norden AB, a company in Sundsvall that offers total contracting in balcony renovation in northern Sweden. The acquisition is expected to contribute positively to earnings per share already in 2023.
NMT Montageteknik i Norden AB had a turnover of 49 MSEK during the last operating year. The acquisition has been financed with existing cash and cash equivalents.
More information can be found in press releases from March 2, 2023.
NMT Montageteknik i Norden AB is consolidated as of March 1, 2023.
The acquisition calculation is preliminary.
| The purchase price comprises the following components (MSEK) | ||
|---|---|---|
| Cash payment | 42,8 | |
| Aquired net assets | -15,3 | |
| Goodwill | 27,5 |
| The following assets and liabilities were included in the acquisition (M | ||
|---|---|---|
| Cash and cash equivalents | 6,1 | |
| Tangible fixed assets | 1,6 | |
| Intangible assets | 8,3 | |
| Receivables | 12,1 | |
| Liabilities | -10,2 | |
| Deferred tax liabilities | -2,6 | |
| Acquired net assets | 15,3 |
This interim report contains references to a number of performance measures. Some of these measures are defined in IFRS, while others are alternative measures and are not reported in accordance with applicable financial reporting frameworks or other legislation. The measures are used by Balco to help both investors and management to analyse its operations. The measures used in this interim report are described below, together with definitions and the reason for their use.
| Alternative performance measures | Definition | Reason for use |
|---|---|---|
| Return on equity | Income for the period divided by the average shareholder equity for the period. Average cal culated as the average of the opening balance and the closing balance for the period. |
Return on equity shows the return that is generated on the shareholders' capital that is invested in the company. |
| Return on capital employed | Adjusted EBITA as a percentage of average cap ital employed for the period. Average calculated as the average of the opening balance and the closing balance for the period. |
Return on capital employed shows the return that is generated on capital employed by the company and is used by Balco to monitor profitability as it re lates to the capital efficiency of the company. |
| Return on capital employed exclud ing goodwill |
Adjusted EBITA as a percentage of average cap ital employed for the period excluding goodwill. Average calculated as the average of the open ing balance and the closing balance for the pe riod. |
Balco believes that return on capital employed ex cluding goodwill together with return on capital employed shows a complete picture of Balco's capi tal efficiency. |
| Gross income | Revenue less production and project costs. | Shows the effectiveness of Balco's operations and together with EBIT provides a complete picture of the operating profit generation and expenses. |
| Gross margin | Gross income as a percentage of net sales. | Ratio is used for analysis of the company's effective ness and profitability. |
| EBITDA | Earnings before interest, tax, depreciation and amortization. |
Balco believes that EBITDA shows the profit gener ated by the operating activities and is a good meas ure of cash flow from operations. |
| Interest-bearing net debt relative to adjusted EBITDA |
Interest-bearing external net debt divided by adjusted EBITDA. |
Balco believes this ratio helps to show financial risk and is a useful measure for Balco to monitor the level of the company's indebtedness. |
| Adjusted EBITDA | EBITDA as adjusted for items affecting compa rability. For a reconciliation of adjusted EBITDA to income for the period. |
Balco believes that adjusted EBITDA is a useful measure for showing the company's profit gener ated by the operating activities after adjusting for items affecting comparability, and primarily uses adjusted EBITDA for purposes of calculating the company's operating cash flow and cash conver sion. |
| Adjusted EBITDA margin | Adjusted EBITDA as a percentage of net sales. | Balco believes that adjusted EBITDA margin is a useful measure for showing the company's profit generated by the operating activities after non-re curring items. |
| Adjusted EBIT margin | Adjusted EBIT as a percentage of net sales. | Balco believes that adjusted EBIT margin is a useful measure for showing the company's profit gener ated by the operating activities. |
| Adjusted EBIT | EBIT adjusted for items affecting comparability. For a reconciliation of adjusted EBIT to income for the period. |
Balco believes that adjusted EBITA is a useful meas ure for showing the company's profit generated by the operating activities, and primarily uses adjusted EBIT for calculating the company's return on capital employed. |
| Adjusted EBITA margin | Adjusted EBITA as a percentage of net sales. | Balco believes that adjusted EBITA margin is a use ful measure for showing the company's profit gen erated by the operating activities. |
| Alternative performance measures | Definition | Reason for use |
|---|---|---|
| Adjusted EBITA | EBITA adjusted for items affecting comparabil ity. For a reconciliation of adjusted EBIT to in come for the period. |
Balco believes that adjusted EBIT is a useful meas ure for showing the company's profit generated by the operating activities, and primarily uses adjusted EBIT for calculating the company's return on capital employed. |
| Items affecting comparability | Items affecting comparability are significant items reported separately due to their size or frequency, e.g., restructuring costs, write downs, divestments and acquisition costs. |
Balco believes that adjustment for items affecting comparability improves the possibility of compari son over time by excluding items with irregularity in frequency or size. This is to give a more accurate picture of the underlying operating profit. |
| Operating cash conversion | Operating cash flow divided by adjusted EBITDA. |
Balco believes this is a good measure for comparing cash flow with operating profit. |
| Operating cash flow | Adjusted EBITDA increased/decreased with changes in net working capital less investments, excluding expansion investments. |
Operating cash flow is used by Balco to monitor business performance. |
| Organic growth | Net sales excluding acquired growth current period divided by net sales during the corre sponding period last year. |
Organic growth excludes the effects of changes in the Group's structure, which enables a comparison of net sales over time. |
| Interest-bearing net deb | The sum of non-current interest-bearing liabili ties and current interest-bearing liabilities. |
Balco believes interest-bearing net debt is a useful measure to show the company's total debt financ ing. |
| Net working capital | Current assets excluding cash and cash equiva lents and current tax assets less non-interest bearing liabilities excluding current tax liabili ties. |
This measure shows how much net working capital that is tied up in the operations and can be put in relation to sales to understand how effectively net working capital tied up in the operations is used. |
| EBIT margin | EBIT as a percentage of net sales. | Balco believes EBIT margin is a useful measure to gether with net sales growth and net working capi tal to monitor value creation. |
| EBIT | Earnings before interest and tax. | Balco believes that EBIT shows the profit generated by the operating activities. |
| EBITA margin | EBITA as a percentage of net sales. | Balco believes EBITA margin is a useful measure to gether with net sales growth and net working capi tal to monitor value creation. |
| EBITA | EBIT excluding amortization on acquired intan gible assets. |
Balco's growth strategy includes acquiring compa nies. In order to better illustrate the development of the underlying business, the management has cho sen to follow EBITA, which is an expression of the operating profit before depreciation and write downs of acquired intangible assets. |
| Equity/asset ratio | Equity divided on total assets. | Balco believes that equity to asset ratio is a useful measure for the company's survival. |
| Capital employed | Equity plus interest-bearing net debt. | Capital employed is used by Balco to indicate the general capital efficiency of the company. |
| Capital employed excluding good will |
Capital employed minus goodwill. | Capital employed excluding goodwill is used to gether with capital employed by Balco as a measure of the company's capital efficiency. |
Balco Group is a market leader in the balcony industry, where we develop, manufacture, sell, and take responsibility for the installation of our own bespoke open and glazed balcony systems. The Group's customised products contribute to enhanced quality of life, security, and increased value for residents in multi-occupancy buildings. Furthermore, Balco Group's standardised glazing systems result in reduced energy consumption.
501 employees Balco Group was established in 1987 and is a group consisting of producing and selling companies. The Group's seven brands belong to the companies Balco AB, Balco Altaner AS, TBO-Haglinds AB, Stora Fasad AB, RK Teknik i Gusum AB, Söderåsen Mur & Kakel AB and NMT Montageteknik AB. The group is the market leader in Scandinavia and operates in several markets in northern Europe. The head office is located in Växjö, and the group has more than 500 employees. A general and distinctive feature of the companies in the Group is that they control the entire value chain - from sales work to installed balcony - through a decentralised and efficient sales process.
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