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Bergman & Beving
Quarterly Report • Oct 19, 2023
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Quarterly Report
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Interim Report 1 April–30 September 2023
Second quarter (1 July–30 September 2023)
- Revenue rose by 2 percent to MSEK 1,094 (1,073).
- EBITA increased by 27 percent to MSEK 107 (84) and the EBITA margin improved to 9.8 percent (7.8).
- Net profit totalled MSEK 49 (49).
- Cash flow from operating activities increased by 252 percent to MSEK 176 (50).
- Two acquisitions have been completed, with total annual revenue of approximately MSEK 135.
Six months (1 April–30 September 2023)
- Revenue rose by 2 percent to MSEK 2,322 (2,273).
- EBITA increased by 21 percent to MSEK 212 (175) and the EBITA margin improved to 9.1 percent (7.7).
-
Net profit totalled MSEK 97 (104).
-
Earnings per share for the most recent 12-month period amounted to SEK 7.45 (7.75) before dilution and SEK 7.40 (7.70) after dilution.
- Four acquisitions have been completed, with total annual revenue of approximately MSEK 220.
| 3 months | 6 months | Rolling 12 months | ||||||
|---|---|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |||
| MSEK | 2023 | 2022 | ∆ % | 2023 | 2022 | ∆ % | 2023 | 2023 |
| Revenue | 1,094 | 1,073 | 2 | 2,322 | 2,273 | 2 | 4,798 | 4,749 |
| EBITA | 107 | 84 | 27 | 212 | 175 | 21 | 419 | 382 |
| EBITA margin, percent | 9.8 | 7.8 | 9.1 | 7.7 | 8.7 | 8.0 | ||
| Profit after financial items | 64 | 61 | 5 | 126 | 131 | -4 | 266 | 271 |
| Net profit (after taxes) | 49 | 49 | 0 | 97 | 104 | -7 | 207 | 214 |
| Earnings per share before dilution, SEK | 1.80 | 1.80 | 3.50 | 3.85 | 7.45 | 7.80 | ||
| Earnings per share after dilution, SEK | 1.80 | 1.80 | 3.45 | 3.85 | 7.40 | 7.80 | ||
| P/WC, percent | 23 | 21 | ||||||
| Cash flow from operating activities | 176 | 50 | 252 | 355 | 129 | 175 | 559 | 333 |
| Equity/assets ratio, percent | 40 | 39 | ||||||
| Number of employees at the end of the | ||||||||
| period | 1,324 | 1,311 | 1 | 1,324 | 1,311 | 1 | 1,324 | 1,348 |
Unless otherwise stated, comparisons in brackets pertain to the corresponding period in the preceding year.
CEO's comments
"We are continuing to trim the sails"
Continued positive earnings performance despite a weaker market
EBITA increased compared with the preceding quarter and rose by 27 percent year on year to MSEK 107 (84). We are approaching a double-digit operating margin since this meant that the EBITA margin increased 2 percentage points to 9.8 percent (7.8).
This was despite weaker demand in the construction sector during the quarter and a slowdown in industry as a whole. Demand was also impacted by our Nordic reseller customers continuing to reduce their buffer inventories. Overall, together with the ongoing efforts to phase out low-margin transactions, this contributed to a smaller revenue increase for the quarter, and organic revenue declined by 7 percent. Our acquisitions of companies with healthy margins and efforts to continually improve the product mix, increased the contribution margin ratio by some 2.5 percentage points during the quarter. Initiated cost savings have yielded results and the Group's like-for-like costs continued to decline. Together, this resulted in a significant earnings improvement in the quarter, which is typically our seasonally weakest quarter of the year.
The Building Materials and Tools & Consumables divisions increased their earnings considerably during the quarter and both posted double-digit operating margins, while earnings declined in the Workplace Safety division. The primary reason for the increase in earnings for Tools & Consumables was the cost savings we have initiated, particularly in Luna, have had a positive effect on earnings despite lower like-for-like revenue than in the preceding year. The decline in profit in Workplace Safety was partly the result of that the division's main customer group, Nordic resellers, do inventory reductions. Additional cost-saving measures were implemented in Workplace Safety to adapt to lower demand.
Increased earnings and lower inventories yield a strong cash flow
Combined with lower inventories, the increase in earnings boosted cash flow from operating activities, which amounted to MSEK 176 (50) during the quarter. Inventories decreased by almost MSEK 300 organically year on year.
Acquisitions of highly profitable, market-leading niche companies with the prerequisites for growth
We acquired two companies during the second quarter. The acquisition of Itaab, the Swedish market leader in metal suspended ceilings that are mainly installed in public properties, provides us with a platform in a niche in the construction sector that is expected to grow. The acquisition of Sandbergs strengthens our presence in the niche for liquid-handling equipment in Sweden, where we already own Germ. Sandbergs' customers are mainly active in industry, haulage/contracting and public-sector operations in northern Sweden, where future market conditions are assessed as favourable. These acquisitions will provide the Group with annual revenue of approximately MSEK 135 with healthy profitability. I welcome Itaab and Sandbergs to the Group and look forward to supporting the companies in their respective growth journeys.
Ambition to increase profitability, earnings and cash flow
Our ambition is to continue to improve profitability, earnings, margins and cash flow in the Group. Our decentralised governance model allows our companies to rapidly adapt to prevailing conditions and not find themselves complaining that there is too little wind – they trim the sails! Thanks to our companies' and employees' proactive actions to respond to changes in the economy, we are well prepared to adapt to varying market conditions on a company-by-company basis. All of our companies have concrete short- and long-term targets and activities in place that will ensure we will continue to focus on earnings growth ahead of revenue growth. We will continue improving our working capital efficiency, primarily by reducing inventory levels and improving the operating margin, including additional efficiency measures. Despite a weaker underlying market, we have the prerequisites to increase the Group's profitability, margin and cash flow through improvements in our 27 companies. Moreover, we intend to acquire highly profitable niche companies with strong cash flows during the operating year. I therefore believe that Bergman & Beving has good potential to continue to improve its earnings, and our ambition of reaching MSEK 500 in operating profit by the 2025/2026 operating year remains firm.
Stockholm, October 2023
Magnus Söderlind President & CEO
Profit and revenue
Second quarter (July–September 2023)
Revenue rose by 2 percent to MSEK 1,094 (1,073). Acquired revenue growth amounted to 7 percent and exchange-rate fluctuations had a positive impact of 2 percent on revenue. Revenue decreased by 7 percent organically due to a weaker market and the continued phase-out of low-margin transactions in combination with inventory reductions among our reseller customers.
Demand from customers in the construction sector in the Nordic region slowed somewhat as a result of a continuing decline in the number of employees in the sector. However, the construction market for commercial properties and infrastructure projects was more stable. Demand from industry customers remained stable but was characterised by increased uncertainty. As a result, resellers postponed their orders for the winter season and continued to reduce their buffer inventories, which impacted many of the Group's companies.
EBITA for the second quarter increased by 27 percent to MSEK 107 (84) and the EBITA margin improved to 9.8 percent (7.8).
Profit after financial items totalled MSEK 64 (61). Increased interest expenses for bank loans and a higher IFRS 16-related interest expense had a negative impact on financial expenses. Net profit totalled MSEK 49 (49).
Six months (April–September 2023)
Revenue rose by 2 percent to MSEK 2,322 (2,273). Acquired growth amounted to 8 percent. Exchange-rate fluctuations had a positive impact of 2 percent on revenue. Revenue decreased by 8 percent organically.
EBITA for the period increased by 21 percent to MSEK 212 (175) and the EBITA margin improved to 9.1 percent (7.7).
Profit after financial items amounted to MSEK 126 (131). Net profit amounted to MSEK 97 (104) and earnings per share on a rolling 12-month basis totalled SEK 7.40 (7.70) after dilution.
Performance by division
| 3 months | 6 months | Rolling 12 months | ||||||
|---|---|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |||
| MSEK | 2023 | 2022 | ∆ % | 2023 | 2022 | ∆ % | 2023 | 2023 |
| Revenue | ||||||||
| Building Materials | 346 | 310 | 12 | 739 | 699 | 6 | 1,419 | 1,379 |
| Workplace Safety | 354 | 378 | -6 | 759 | 789 | -4 | 1,626 | 1,656 |
| Tools & Consumables | 402 | 395 | 2 | 841 | 805 | 4 | 1,788 | 1,752 |
| Group-wide/eliminations | -8 | -10 | -17 | -20 | -35 | -38 | ||
| Total revenue | 1,094 | 1,073 | 2 | 2,322 | 2,273 | 2 | 4,798 | 4,749 |
| EBITA | ||||||||
| Building Materials | 37 | 26 | 42 | 87 | 63 | 38 | 138 | 114 |
| Workplace Safety | 19 | 35 | -46 | 53 | 74 | -28 | 131 | 152 |
| Tools & Consumables | 50 | 24 | 108 | 81 | 41 | 98 | 161 | 121 |
| Group-wide/eliminations | 1 | -1 | -9 | -3 | -11 | -5 | ||
| Total EBITA | 107 | 84 | 27 | 212 | 175 | 21 | 419 | 382 |
| EBITA margin, percent | ||||||||
| Building Materials | 10.7 | 8.4 | 11.8 | 9.0 | 9.7 | 8.3 | ||
| Workplace Safety | 5.4 | 9.3 | 7.0 | 9.4 | 8.1 | 9.2 | ||
| Tools & Consumables | 12.4 | 6.1 | 9.6 | 5.1 | 9.0 | 6.9 | ||
| Total EBITA margin | 9.8 | 7.8 | 9.1 | 7.7 | 8.7 | 8.0 |
Performance by division –
second quarter
Building Materials
Building Materials' revenue rose by 12 percent to MSEK 346 (310). EBITA increased by 42 percent to MSEK 37 (26) and the EBITA margin improved to 10.7 percent (8.4).
The earnings increase in the division was mainly related to operational improvements and acquired units. ESSVE continued to implement operational enhancements that improved its earnings. Fire Protection reported strong improvements, doubling its earnings despite a slight decline in onshore sales. Demand from customers in the marine industry increased further during the quarter and the first order for fire seals for offshore wind power plants, which is an important growth area, were secured.
Workplace Safety
Workplace Safety's revenue amounted to MSEK 354 (378). EBITA amounted to MSEK 19 (35) and the EBITA margin was 5.4 percent (9.3).
Weaker demand impacted many of the units in the division and was the main reason for the lower earnings. Additional cost-saving measures were implemented in the division.
Tools & Consumables
Tools & Consumables' revenue rose by 2 percent to MSEK 402 (395). EBITA increased by 108 percent to MSEK 50 (24) and the EBITA margin improved to 12.4 percent (6.1).
For companies in the division with more direct transactions with industry customers, demand remained strong and several of the division's companies reported a positive trend. Luna reported the largest earnings improvement, with implemented cost measures more than compensating for weaker demand. However, Luna's earnings for the preceding year were impacted negatively in an amount of approximately MSEK 10 as a result of an IT attack on the company's former logistics provider. Even taking this into consideration, Luna accounted for the largest earnings improvement in the division.
Group-wide and eliminations
Group-wide items and eliminations for the second quarter amounted to MSEK 1 (-1).
The Parent Company's revenue amounted to MSEK 22 (19) and profit after financial items to MSEK 26 (18) for the period from April to September.
Employees
At the end of the period, the number of employees in the Group totalled 1,324, compared with 1,348 at the beginning of the financial year. During the period from April to September, 45 employees were gained via acquisitions.
Corporate acquisitions
On 3 April, Tools & Consumables acquired all of the shares in Tema Norge AS. Tema Norge is a leading player in Norway in orbital welding and mechanised welding technology and generates annual revenue of approximately MSEK 45.
On 12 June, the Building Materials division acquired all of the shares in Elkington AB. The company is a leading actor in Sweden in floor access hatches but also sells related products in wall and roof hatches. The company has annual revenue of approximately MSEK 40.
On 6 July, the Building Materials division acquired all of the shares in Itaab Trading AB. The company is the leading manufacturer and supplier of metal suspended ceilings in Sweden with annual revenue of approximately MSEK 75.
On 31 August, Tools & Consumables acquired all of the shares in Sandbergs i Jämtland AB. The company is a niched supplier of equipment within handling of liquids in Sweden. The company has annual revenue of approximately MSEK 60.
Bergman & Beving normally uses an acquisition model with a base consideration and a contingent consideration. The outcome of the contingent consideration depends on the future earnings of the acquired company.
Preliminary purchase price allocations for the acquisitions over the past 12 months:
| Fair value of | |
|---|---|
| acquired assets and liabilities | MSEK |
| Customer relations, etc. | 232 |
| Other non-current assets | 12 |
| Other assets | 195 |
| Deferred tax liability, net | -49 |
| Current liabilities | -83 |
| Acquired net assets | 307 |
| Goodwill | 187 |
| Non-controlling interest | -12 |
| Purchase considerations | 482 |
| Less: Purchase considerations, unpaid | -108 |
| Less: Cash and cash equivalents in acquired | |
| companies | -94 |
| Net change in cash and cash equivalents | -280 |
The unpaid purchase considerations of MSEK 108 are contingent and are estimated to amount to a maximum of MSEK 108. The contingent considerations will fall due within four years, but the majority of them will fall due earlier.
Acquisition analyses older than 12 months are considered finalised.
| Rev. | No. of | |||
|---|---|---|---|---|
| Acquisition | Closing | MSEK* | empl.* Division | |
| A.T.E. Solutions, | Feb | Tools & | ||
| UK | 2023 | 32 | 17 | Consumables |
| Kiilax, | Feb | Building | ||
| Finland | 2023 | 100 | 24 | Materials |
| Tema Norge, | Apr | Tools & | ||
| Norway | 2023 | 45 | 8 | Consumables |
| Elkington, | Jun | Building | ||
| Sweden | 2023 | 40 | 6 | Materials |
| Itaab, | Jul | Building | ||
| Sweden | 2023 | 75 | 23 | Materials |
| Sandbergs, | Aug | Tools & | ||
| Sweden | 2023 | 60 | 8 | Consumables |
* Refers to the situation assessed on a full-year basis on the date of acquisition.
Considerations of MSEK 8 pertaining to previous years' acquisitions were paid during the first six months. No remeasurement of contingent considerations was carried out during the period.
Acquisition-related transaction costs for the year's acquisitions, which are recognised in other operating expenses in the income statement, amounted to MSEK 0 (3).
Profitability, cash flow and financial position
Profitability, measured as the return on working capital (P/WC), amounted to 23 percent (21). The return on equity was 9 percent (11).
Cash flow from operating activities for the first six months totalled MSEK 355 (129). Working capital decreased during the period by MSEK 104, mainly a result of a decline in inventory levels.
Cash flow was impacted by net investments in noncurrent assets of MSEK 28 (22) and MSEK 179 (154) pertaining to acquisitions.
The Group's operational net loan liability at the end of the period amounted to MSEK 1,119 (1,091), excluding expensed pension obligations of MSEK 444 (450) and lease liabilities according to IFRS 16 of MSEK 423 (337). Cash and cash equivalents, including unutilised granted credit facilities, totalled MSEK 917 (915).
Financial income and expenses amounted to MSEK -55 (-25) for the first six months, of which the net expense for bank financing amounted to MSEK -35 (-9) for the quarter.
The equity/assets ratio was 40 percent (38). Equity per share increased to SEK 87.10, compared with SEK 84.35 at the beginning of the year.
The Swedish tax rate, which is also the Parent Company's tax rate, was 20.6 percent. The Group's weighted average tax rate, with its current geographic mix, was approximately 22 percent. This higher average tax is a result of a raised corporate tax rate in one of the Group's markets.
Share structure and repurchase of shares
At the end of the period, share capital totalled MSEK 56.9 and was distributed by class of share as follows:
SHARE STRUCTURE
| Class of share | No. of shares | No. of votes | % of capital | % of votes |
|---|---|---|---|---|
| Class A shares, 10 votes per share | 1,062,436 | 10,624,360 | 3.9 | 28.7 |
| Class B shares, 1 vote per share | 26,373,980 | 26,373,980 | 96.1 | 71.3 |
| Total number of shares before repurchasing |
27,436,416 | 36,998,340 | 100.0 | 100.0 |
| Of which, repurchased Class B shares | -769,443 | 2.8 | 2.1 | |
| Total number of shares after repurchasing |
26,666,973 |
The share price on 30 September 2023 was SEK 157.20. The average number of treasury shares was 813,911 during the period and 769,443 at the end of the period. The average purchase price for the repurchased shares was SEK 87.88 per share.
CALL OPTION PROGRAMMES
| Corresponding | % of total | Redemption | |||
|---|---|---|---|---|---|
| Outstanding programmes | No. of options | no. of shares | shares | price | Redemption period |
| Call option programme 2020/2024 | 215,100 | 215,100 | 0.8% | 99.50 | 11 Sep 2023–7 Jun 2024 |
| Call option programme 2021/2025 | 178,000 | 178,000 | 0.6% | 197.30 | 16 Sep 2024–12 Jun 2025 |
| Call option programme 2022/2026 | 210,000 | 210,000 | 0.8% | 106.10 | 9 Sep 2025–5 Jun 2026 |
| Call option programme 2023/2027 | 250,000 | 250,000 | 0.9% | 181.10 | 9 Sep 2026–4 Jun 2027 |
Call options issued for repurchased shares resulted in an insignificant dilution effect. In the first quarter of the year, the 2019/2023 call option programme expired. In the second quarter, the 2023/2027 call option programme resolved on by the Annual General Meeting in August 2023 was issued.
Events after the end of the period
No significant changes occurred after the end of the quarter.
Affirmation
The Board of Directors and the President & CEO affirm that this interim report provides a true and fair overview of the operations, position and earnings of the Parent Company and the Group, and that it describes the material risks and uncertainties to which the Parent Company and the companies within the Group are exposed.
Stockholm, 19 October 2023
Jörgen Wigh Chairman
Fredrik Börjesson Director
Charlotte Hansson Director
Henrik Hedelius Director
Malin Nordesjö Director
Niklas Stenberg Director
Jörgen Bengtsson Director – employee representative Mikael Lindblom Director – employee representative
Magnus Söderlind President & CEO
This report has not been reviewed by the Company's auditors.
Other information
Publication
The information in this report is such that Bergman & Beving AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out below, at 7:45 a.m. CEST on 19 October 2023.
Dates for forthcoming financial information
- Interim Report 1 April–31 December 2023 will be published on 9 February 2024.
- Financial Report 1 April 2023–31 March 2024 will be published on 15 May 2024.
Contact information
Magnus Söderlind, President and CEO, Tel: +46 10 454 77 00 Peter Schön, CFO, Tel: +46 70 339 89 99
Visit www.bergmanbeving.com to download reports, presentations and press releases.
Reporting by quarter
| 2023/2024 | 2022/2023 | 2021/2022 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| MSEK | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Revenue | ||||||||||
| Building Materials | 346 | 393 | 382 | 298 | 310 | 389 | 400 | 277 | 288 | 375 |
| Workplace Safety | 354 | 405 | 425 | 442 | 378 | 411 | 402 | 452 | 351 | 428 |
| Tools & Consumables | 402 | 439 | 438 | 509 | 395 | 410 | 413 | 444 | 385 | 399 |
| Group-wide/eliminations | -8 | -9 | -8 | -10 | -10 | -10 | -10 | -10 | -10 | -9 |
| Total revenue | 1,094 | 1,228 | 1,237 | 1,239 | 1,073 | 1,200 | 1,205 | 1,163 | 1,014 | 1,193 |
| EBITA | ||||||||||
| Building Materials | 37 | 50 | 40 | 11 | 26 | 37 | 29 | 10 | 21 | 34 |
| Workplace Safety | 19 | 34 | 29 | 49 | 35 | 39 | 37 | 43 | 29 | 36 |
| Tools & Consumables | 50 | 31 | 35 | 45 | 24 | 17 | 25 | 33 | 31 | 14 |
| Group-wide/eliminations | 1 | -10 | 0 | -2 | -1 | -2 | -3 | -2 | 0 | -6 |
| Total EBITA | 107 | 105 | 104 | 103 | 84 | 91 | 88 | 84 | 81 | 78 |
| EBITA margin, percent | ||||||||||
| Building Materials | 10.7 | 12.7 | 10.5 | 3.7 | 8.4 | 9.5 | 7.3 | 3.6 | 7.3 | 9.1 |
| Workplace Safety | 5.4 | 8.4 | 6.8 | 11.1 | 9.3 | 9.5 | 9.2 | 9.5 | 8.3 | 8.4 |
| Tools & Consumables | 12.4 | 7.1 | 8.0 | 8.8 | 6.1 | 4.1 | 6.1 | 7.4 | 8.1 | 3.5 |
| Total EBITA margin | 9.8 | 8.6 | 8.4 | 8.3 | 7.8 | 7.6 | 7.3 | 7.2 | 8.0 | 6.5 |
Group summary
| CONSOLIDATED INCOME STATEMENT | 3 months | 6 months | Rolling 12 months | |||
|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 |
| Revenue | 1,094 | 1,073 | 2,322 | 2,273 | 4,798 | 4,749 |
| Other operating income | 3 | 4 | 9 | 7 | 46 | 44 |
| Total operating income | 1,097 | 1,077 | 2,331 | 2,280 | 4,844 | 4,793 |
| Cost of goods sold | -563 | -580 | -1,228 | -1,254 | -2,601 | -2,627 |
| Personnel costs | -231 | -216 | -484 | -449 | -966 | -931 |
| Depreciation, amortisation and impairment losses | -71 | -57 | -137 | -112 | -257 | -232 |
| Other operating expenses | -142 | -150 | -301 | -309 | -656 | -664 |
| Total operating expenses | -1,007 | -1,003 | -2,150 | -2,124 | -4,480 | -4,454 |
| Operating profit | 90 | 74 | 181 | 156 | 364 | 339 |
| Financial income and expenses | -26 | -13 | -55 | -25 | -98 | -68 |
| Profit after financial items | 64 | 61 | 126 | 131 | 266 | 271 |
| Taxes | -15 | -12 | -29 | -27 | -59 | -57 |
| Net profit | 49 | 49 | 97 | 104 | 207 | 214 |
| Of which, attributable to Parent Company | ||||||
| shareholders | 48 | 48 | 93 | 102 | 198 | 207 |
| Of which, attributable to non-controlling interest | 1 | 1 | 4 | 2 | 9 | 7 |
| EBITA | 107 | 84 | 212 | 175 | 419 | 382 |
| Earnings per share before dilution, SEK | 1.80 | 1.80 | 3.50 | 3.85 | 7.45 | 7.80 |
| Earnings per share after dilution, SEK | 1.80 | 1.80 | 3.45 | 3.85 | 7.40 | 7.80 |
| Number of shares outstanding before dilution, '000 | 26,667 | 26,568 | 26,667 | 26,568 | 26,667 | 26,575 |
| Weighted number of shares before dilution, '000 | 26,643 | 26,568 | 26,625 | 26,551 | 26,584 | 26,560 |
| Weighted number of shares after dilution, '000 | 26,792 | 26,568 | 26,799 | 26,587 | 26,706 | 26,586 |
CONSOLIDATED STATEMENT OF
| COMPREHENSIVE INCOME | 3 months | 6 months | Rolling 12 months | |||
|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 |
| Net profit | 49 | 49 | 97 | 104 | 207 | 214 |
| Other comprehensive income | ||||||
| Remeasurement of defined-benefit pension plans | 37 | 79 | 37 | 157 | 0 | 120 |
| Tax attributable to components that will not be | ||||||
| reclassified | -8 | -16 | -8 | -32 | -1 | -25 |
| Components that will not be reclassified to | ||||||
| net profit | 29 | 63 | 29 | 125 | -1 | 95 |
| Translation differences | -27 | 22 | 34 | 33 | 45 | 44 |
| Fair value changes for the year in cash-flow hedges | 1 | -6 | -2 | -4 | 8 | 6 |
| Tax attributable to components that will be | ||||||
| reclassified | -1 | 1 | 0 | 1 | -2 | -1 |
| Components that will be reclassified to net profit | -27 | 17 | 32 | 30 | 51 | 49 |
| Other comprehensive income | 2 | 80 | 61 | 155 | 50 | 144 |
| Total comprehensive income for the period Of which, attributable to Parent Company |
51 | 129 | 158 | 259 | 257 | 358 |
| shareholders | 51 | 127 | 153 | 256 | 247 | 350 |
| Of which, attributable to non-controlling interest | 0 | 2 | 5 | 3 | 10 | 8 |
CONSOLIDATED BALANCE SHEET
| 30 Sep | 30 Sep | 31 Mar | |
|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 |
| Assets | |||
| Goodwill | 1,939 | 1,732 | 1,815 |
| Other intangible non-current assets | 726 | 534 | 604 |
| Tangible non-current assets | 149 | 133 | 140 |
| Right-of-use assets | 424 | 328 | 441 |
| Financial non-current assets | 6 | 5 | 5 |
| Deferred tax assets | 35 | 79 | 34 |
| Inventory | 1,268 | 1,491 | 1,360 |
| Accounts receivable | 885 | 877 | 969 |
| Other current receivables | 172 | 192 | 161 |
| Cash and cash equivalents | 249 | 142 | 220 |
| Total assets | 5,853 | 5,513 | 5,749 |
| Equity and liabilities | |||
| Equity attributable to Parent Company shareholders | 2,252 | 2,087 | 2,181 |
| Non-controlling interest | 63 | 30 | 59 |
| Non-current interest-bearing liabilities | 1,391 | 1,227 | 1,362 |
| Provisions for pensions | 444 | 450 | 490 |
| Other non-current liabilities and provisions | 260 | 245 | 207 |
| Current interest-bearing liabilities | 400 | 343 | 385 |
| Accounts payable | 448 | 567 | 487 |
| Other current liabilities | 595 | 564 | 578 |
| Total equity and liabilities | 5,853 | 5,513 | 5,749 |
CONSOLIDATED STATEMENT OF EQUITY ATTRIBUTABLE TO PARENT COMPANY SHAREHOLDERS
| 30 Sep | 30 Sep | 31 Mar | |
|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 |
| Opening equity | 2,181 | 1,915 | 1,915 |
| Dividend | -96 | -90 | −90 |
| Exercise and purchase of options for repurchased shares | 14 | 6 | 6 |
| Total comprehensive income for the period | 153 | 256 | 350 |
| Closing equity | 2,252 | 2,087 | 2,181 |
| CONSOLIDATED CASH-FLOW STATEMENT | 3 months | 6 months | Rolling 12 months | |||
|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 |
| Operating activities before changes in working capital |
111 | 69 | 251 | 198 | 442 | 389 |
| Changes in working capital | 65 | -19 | 104 | -69 | 117 | -56 |
| Cash flow from operating activities | 176 | 50 | 355 | 129 | 559 | 333 |
| Investments in intangible and tangible assets | -11 | -12 | -29 | -23 | -51 | -45 |
| Proceeds from sale of intangible and tangible assets | 1 | 1 | 1 | 1 | 0 | 0 |
| Acquisition of businesses | -81 | -87 | -179 | -154 | -280 | -255 |
| Disposal of businesses | - | - | - | - | 19 | 19 |
| Cash flow before financing | 85 | -48 | 148 | -47 | 247 | 52 |
| Financing activities | -61 | -21 | -123 | 3 | -151 | -25 |
| Cash flow for the period | 24 | -69 | 25 | -44 | 96 | 27 |
| Cash and cash equivalents at the beginning of | ||||||
| the period | 231 | 212 | 220 | 182 | 142 | 182 |
| Cash flow for the period | 24 | -69 | 25 | -44 | 96 | 27 |
| Exchange-rate differences in cash and cash | ||||||
| equivalents | -6 | -1 | 4 | 4 | 11 | 11 |
| Cash and cash equivalents at the end of the | ||||||
| period | 249 | 142 | 249 | 142 | 249 | 220 |
Compilation of key financial ratios
| KEY RATIOS | Rolling 12 months | |||||
|---|---|---|---|---|---|---|
| 30 Sep | 31 Mar | 31 Mar | 31 Mar | 31 Mar | ||
| MSEK | 2023 | 2023 | 2022 | 2021 | 2020 | |
| Revenue | 4,798 | 4,749 | 4,575 | 4,311 | 4,060 | |
| EBITDA | 621 | 571 | 503 | 426 | 353 | |
| EBITA | 419 | 382 | 331 | 271 | 208 | |
| EBITA margin, percent | 8.7 | 8.0 | 7.2 | 6.3 | 5.1 | |
| Operating profit | 364 | 339 | 298 | 247 | 189 | |
| Operating margin, percent | 7.6 | 7.1 | 6.5 | 5.7 | 4.7 | |
| Profit after financial items | 266 | 271 | 259 | 212 | 155 | |
| Net profit | 207 | 214 | 202 | 166 | 116 | |
| Profit margin, percent | 5.5 | 5.7 | 5.7 | 4.9 | 3.8 | |
| Return on working capital (P/WC), percent | 23 | 21 | 22 | 20 | 16 | |
| Return on capital employed, percent | 9 | 8 | 8 | 7 | 6 | |
| Return on equity, percent | 9 | 10 | 11 | 10 | 7 | |
| Operational net loan liability (closing balance) | 1,119 | 1,090 | 889 | 697 | 695 | |
| Operational net debt/equity ratio | 0.5 | 0.5 | 0.5 | 0.4 | 0.4 | |
| Operational net loan liability/EBITDA, multiple | 1.8 | 1.9 | 1.8 | 1.6 | 2.0 | |
| Equity (closing balance) | 2,315 | 2,240 | 1,932 | 1,715 | 1,643 | |
| Equity/assets ratio, percent | 40 | 39 | 36 | 35 | 35 | |
| Number of employees at the end of the period | 1,324 | 1,348 | 1,227 | 1,129 | 1,083 |
| KEY PER-SHARE DATA | Rolling 12 months | |||||
|---|---|---|---|---|---|---|
| SEK | 30 Sep 2023 |
31 Mar 2023 |
31 Mar 2022 |
31 Mar 2021 |
31 Mar 2020 |
|
| Earnings before dilution | 7.45 | 7.80 | 7.55 | 6.15 | 4.30 | |
| Earnings after dilution | 7.40 | 7.80 | 7.50 | 6.15 | 4.30 | |
| Cash flow from operating activities | 21.05 | 12.55 | 8.50 | 14.40 | 8.25 | |
| Equity | 87.10 | 84.35 | 72.85 | 64.40 | 61.10 | |
| Share price | 157.20 | 128.40 | 141.40 | 121.40 | 50.30 |
Parent Company summary
| INCOME STATEMENT | 3 months 6 months |
Rolling 12 months | ||||
|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | |
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 |
| Revenue | 12 | 10 | 22 | 19 | 40 | 37 |
| Other operating income | 0 | - | 0 | - | 0 | 0 |
| Total operating income | 12 | 10 | 22 | 19 | 40 | 37 |
| Operating expenses | -13 | -10 | -25 | -25 | -54 | -54 |
| Operating profit/loss | -1 | 0 | -3 | -6 | -14 | -17 |
| Financial income and expenses | 12 | 13 | 29 | 24 | 52 | 47 |
| Profit after financial items | 11 | 13 | 26 | 18 | 38 | 30 |
| Appropriations | - | - | - | - | 15 | 15 |
| Profit before taxes | 11 | 13 | 26 | 18 | 53 | 45 |
| Taxes | -2 | -3 | -5 | -4 | -2 | -1 |
| Net profit | 9 | 10 | 21 | 14 | 51 | 44 |
| STATEMENT OF COMPREHENSIVE INCOME | 3 months | 6 months | Rolling 12 months | |||
|---|---|---|---|---|---|---|
| MSEK | Jul–Sep 2023 |
Jul–Sep 2022 |
Apr–Sep 2023 |
Apr–Sep 2022 |
30 Sep 2023 |
31 Mar 2023 |
| Net profit | 9 | 10 | 21 | 14 | 51 | 44 |
| Fair value changes for the year in cash-flow hedges |
1 | -6 | -2 | -4 | 8 | 6 |
| Taxes attributable to other comprehensive income |
-1 | 1 | 0 | 1 | -2 | -1 |
| Components that will be reclassified to net profit |
0 | -5 | -2 | -3 | 6 | 5 |
| Other comprehensive income | 0 | -5 | -2 | -3 | 6 | 5 |
| Total comprehensive income for the period | 9 | 5 | 19 | 11 | 57 | 49 |
BALANCE SHEET
| 30 Sep | 30 Sep | 31 Mar | |
|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 |
| Assets | |||
| Intangible non-current assets | - | 0 | - |
| Tangible non-current assets | 1 | 2 | 2 |
| Financial non-current assets | 2,570 | 2,448 | 2,583 |
| Current receivables | 1,044 | 837 | 1,121 |
| Cash and bank | 0 | 1 | 1 |
| Total assets | 3,615 | 3,288 | 3,707 |
| Equity, provisions and liabilities | |||
| Equity | 1,081 | 1,106 | 1,144 |
| Untaxed reserves | 6 | 49 | 6 |
| Provisions | 42 | 40 | 43 |
| Non-current liabilities | 1,263 | 1,146 | 1,283 |
| Current liabilities | 1,223 | 947 | 1,231 |
| Total equity, provisions and liabilities | 3,615 | 3,288 | 3,707 |
Notes
1. Accounting policies
This Interim Report was prepared in accordance with IFRS and by applying IAS 34, Interim Financial Reporting, the Swedish Annual Accounts Act and the Swedish Securities Market Act. The Interim Report for the Parent Company was prepared in accordance with the Swedish Annual Accounts Act and the Swedish Securities Market Act, which conforms to the provisions detailed in RFR 2 Accounting for Legal Entities.
The same accounting policies and bases of judgement have been applied in this Interim Report as in the Annual Report for 2022/2023. Disclosures are provided in the financial statements and accompanying notes as well as other sections of the interim report.
New or amended accounting standards which take effect in coming periods
A number of new and amended IFRS have not yet come into effect and have not been applied in advance in the preparation of this financial statement. The amended IFRS to be applied in the future are not expected to have any material impact on the Group's financial statements.
2. Revenue per geographic area
The Group primarily conducts operations in Sweden, Norway and Finland and revenue presented for the geographic markets is based on the domicile of the customers.
| 3 months | 6 months | Rolling 12 months | |||||
|---|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | ||
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 | |
| Sweden | 363 | 378 | 798 | 849 | 1,686 | 1,737 | |
| Norway | 269 | 278 | 550 | 586 | 1,159 | 1,195 | |
| Finland | 120 | 109 | 268 | 233 | 542 | 507 | |
| Other countries | 342 | 308 | 706 | 605 | 1,411 | 1,310 | |
| Revenue | 1,094 | 1,073 | 2,322 | 2,273 | 4,798 | 4,749 |
3. Leases
Leases under IFRS 16 have the following effect on the consolidated balance sheet or income statement.
| 30 Sep | 30 Sep | 31 Mar | |
|---|---|---|---|
| MSEK | 2023 | 2022 | 2023 |
| Right-of-use assets | 424 | 328 | 441 |
| Non-current lease liabilities | 286 | 221 | 297 |
| Current lease liabilities | 137 | 116 | 140 |
| 3 months | 6 months | Rolling 12 months | |||||
|---|---|---|---|---|---|---|---|
| Jul–Sep | Jul–Sep | Apr–Sep | Apr–Sep | 30 Sep | 31 Mar | ||
| MSEK | 2023 | 2022 | 2023 | 2022 | 2023 | 2023 | |
| Depreciation of right-of-use assets | -39 | -33 | -76 | -66 | -145 | -135 | |
| Interest on lease liabilities | -3 | -2 | -7 | -4 | -12 | -9 |
IFRS 16 will not affect operational follow-up or follow-up of earnings from the divisions.
The increase in right-of-use assets and lease liabilities pertains primarily to the new logistics facility. The new lease gave rise to an increase of MSEK 1 in IFRS 16 interest for the quarter.
4. Risks and uncertainties
The uncertain geopolitical situation, the general conditions and inflation have intensified, but have had a marginal impact on the Group to date. Otherwise, no significant changes occurred during the financial year with respect to risks and uncertainties, for either the Group or the Parent Company. For information about these risks and uncertainties, refer to pages 58–61 of Bergman & Beving's Annual Report for 2022/2023.
5. Transactions with related parties
No transactions having a material impact on the Group's position or earnings occurred between Bergman & Beving and its related parties during the financial year.
6. Alternative performance measures
Bergman & Beving uses certain financial performance measures in its analysis of the operations and their performance that are not calculated in accordance with IFRS. The Company believes that these performance measures provide valuable information for investors, since they enable a more accurate assessment of current trends when combined with other key financial ratios calculated in accordance with IFRS. Since listed companies do not always calculate these performance measures ratios in the same way, there is no guarantee that the information is comparable with other companies' performance measures of the same name.
Change in revenue
Comparable units refer to sales in local currency from units that were part of the Group during the current period and the entire corresponding period in the preceding year. Acquisitions/divestments refer to the acquisition or divestment of units during the corresponding period.
| 3 months | 6 months | ||||
|---|---|---|---|---|---|
| Percentage change in revenue for: | Jul–Sep 2023 |
Jul–Sep 2022 |
Apr–Sep 2023 |
Apr–Sep 2022 |
|
| Comparable units in local currency | -7 | -4 | -8 | -4 | |
| Currency effects | 2 | 3 | 2 | 2 | |
| Acquisitions/divestments | 7 | 7 | 8 | 5 | |
| Total – change | 2 | 6 | 2 | 3 |
EBITA
Operating profit for the period before impairment of goodwill and amortisation and impairment of other intangible assets in connection with corporate acquisitions and equivalent transactions.
| 3 months | 6 months | Rolling 12 months | |||||
|---|---|---|---|---|---|---|---|
| MSEK | Jul–Sep 2023 |
Jul–Sep 2022 |
Apr–Sep 2023 |
Apr–Sep 2022 |
30 Sep 2023 |
31 Mar 2023 |
|
| Operating profit Depreciation and amortisation in connection |
90 | 74 | 181 | 156 | 364 | 339 | |
| with acquisitions | 17 | 10 | 31 | 19 | 55 | 43 | |
| EBITA | 107 | 84 | 212 | 175 | 419 | 382 |
EBITDA
Operating profit for the period before depreciation/amortisation and impairment losses.
| 3 months | 6 months | Rolling 12 months | |||||
|---|---|---|---|---|---|---|---|
| MSEK | Jul–Sep 2023 |
Jul–Sep 2022 |
Apr–Sep 2023 |
Apr–Sep 2022 |
30 Sep 2023 |
31 Mar 2023 |
|
| Operating profit Depreciation, amortisation and impairment |
90 | 74 | 181 | 156 | 364 | 339 | |
| losses | 71 | 57 | 137 | 112 | 257 | 232 | |
| EBITDA | 161 | 131 | 318 | 268 | 621 | 571 |
Return on working capital (P/WC)
Bergman & Beving's profitability target is for each unit in the Group to achieve profitability of at least 45 percent, measured as EBITA (P) for the rolling 12-month period as a percentage of average 12 months' working capital (WC), defined as inventories plus accounts receivable less accounts payable.
| Rolling 12 months | ||||
|---|---|---|---|---|
| 30 Sep | 30 Sep | 31 Mar | ||
| MSEK | 2023 | 2022 | 2023 | |
| EBITA (P) | 419 | 347 | 382 | |
| Average working capital (WC) | ||||
| Inventory | 1,374 | 1,311 | 1,389 | |
| Accounts receivable | 896 | 892 | 924 | |
| Accounts payable | -466 | -557 | -516 | |
| Total – average WC | 1,804 | 1,646 | 1,797 | |
| P/WC, percent | 23 | 21 | 21 |
7. Other definitions
Return on equity1
Net profit for the rolling 12-month period divided by average 12-month equity.
Return on capital employed
Profit after financial items plus financial expenses for the rolling 12-month period divided by the average balance-sheet total less non-interest-bearing liabilities.
EBITA margin
EBITA for the period as a percentage of revenue.
Equity per share1
Equity divided by the weighted number of shares at the end of the period.
Cash flow per share
Cash flow for the rolling 12-month period from operating activities divided by the weighted number of shares.
Operational net loan liability
Interest-bearing liabilities excluding lease liabilities and provisions for pensions less cash and cash equivalents.
Operational net debt/equity ratio1
Operational net loan liability divided by equity.
Earnings per share
Net profit attributable to the Parent Company shareholders divided by the weighted number of shares.
Operating margin
Operating profit for the period as a percentage of revenue.
Equity/assets ratio1
Equity as a percentage of the balance-sheet total.
Profit margin
Net profit after financial items as a percentage of revenue.
Weighted number of shares
Average number of shares outstanding before or after dilution. Shares held by Bergman & Beving are not included in the number of shares outstanding. Dilution effects arise due to call options that can be settled using shares in share-based incentive programmes. The call options have a dilution effect when the average share price during the period is higher than the redemption price of the call options.
1 Minority shares are included in equity when this performance measure is calculated.
Bergman & Beving in brief
- Bergman & Beving, founded in 1906, is a Swedish listed corporate group with extensive experience in acquiring and developing leading niche companies from a long-term ownership perspective.
- Bergman & Beving's vision is to be a leading niche supplier of productive, safe and sustainable solutions to companies.
- Our decentralised governance model means that we strive for leading positions through organic growth and addon acquisitions in existing niches and through acquisitions in new niches.
- Through our products, we are represented at over 5,000 sales outlets and by distributors in approximately 25 countries.
- Our primary market is the Nordic region, which accounts for approximately 70 percent of revenue.
- We aim to be a sustainable company where we actively work to create long-term value for society and our shareholders while limiting the impact of our operations on the environment.
- The subsidiaries in the Group are operated with decentralised business responsibility, with a focus on simplicity, responsibility and freedom, efficiency, openness and a willingness to change.
Our business units:
