Earnings Release • Jul 15, 2022
Earnings Release
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| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 |
| Operating profit | 61 | 108 | 97 | 139 | 193 | 235 |
| Operating margin, % | 2.3 | 4.7 | 2.1 | 3.3 | 2.1 | 2.7 |
| Profit/loss for the period | 72 | 178 | 127 | 224 | 252 | 349 |
| Earnings per share, SEK, before dilution | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Earnings per share, SEK, after dilution | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Equity per share, SEK, after dilution | 91.92 | 83.76 | 91.92 | 83.76 | 91.92 | 87.85 |
| Equity/assets ratio, % | 37.9 | 37.2 | 37.9 | 37.2 | 37.9 | 35.7 |
| Net debt/receivable | -1,466 | -206 | -1,466 | -206 | -1,466 | -873 |
| Net debt, or receivable/EBITDA | -5.4 | -2.2 | -5.4 | -2.2 | -5.4 | -2.8 |
| Net debt/equity ratio, % | -56.3 | -8.8 | -56.3 | -8.8 | -56.3 | -35.4 |
| Order bookings | 1,598 | 2,221 | 3,435 | 3,400 | 6,380 | 6,345 |
| Order backlog | 11,234 | 13,372 | 11,234 | 13,372 | 11,234 | 12,101 |
Over the second quarter of the year, the external situation has shifted in the direction of increased uncertainty with regard to several factors affecting us and our industry. Despite this external turbulence, I am nonetheless satisfied to summarize our first half of the year as a period in which we continued to strengthen the company in its priority areas – profitability, balanced growth, stability, and development.
Our consolidated operating profit for the quarter of SEK61million (108), and the operating profit of SEK22million (14) from the Swedish contracting operations, demonstrate that we are able to maintain the stable trend of recent quarters despite these external factors. Business Area Sweden increased its income for the quarter by 34percent to SEK2,709million (2,019), partly due to a higher production rate in several projects in the Karlastaden district and to production having commenced on several other divested projects.
Our order bookings for the quarter decreased slightly compared with the corresponding period in the preceding year, ending up at SEK1,598million (2,221). I feel confident with the level, however, particularly as we currently have several major collaborative projects in Phase 1 that have yet to be added to the order book, but for which the implementation phases are due to commence relatively soon. With interest rates and a insecure housing market characterizing demand, we derive further security from having been able to refocus the product mix in our order backlog. Compared with the situation in the second quarter of 2021, we have a larger share of projects involving public properties, industrial properties and offices and a smaller share of housing. Although underlying housing needs remain extensive, there is a risk that demand will decrease due to inflation and interest rates. The larger proportion of public projects and clients that we currently have in the portfolio brings stability.
Over the quarter, we experienced a general continued rise in prices for materials, although suppliers and customers alike have, to some extent, successfully realigned and adapted to the situation caused by war and sanctions. We have raised our preparedness, adapted our agreements and have been able to find alternative supply paths. For certain types of materials, prices are declining, albeit from high levels, although the degree of uncertainty requires us to monitor developments closely.
I am also pleased that we managed to strengthen our financial flexibility during the quarter, as well as our opportunities for the future, by prematurely repaying a short-term bond loan, transitioning instead towards a long-term financing model using bank loans. Accordingly, we are transitioning towards increased financial stability, partly through this measure and partly by being even more careful and selective in our investments in our own projects. In times of uncertainty, discipline and planning are crucial in remaining robust and generating freedom of action for oneself.
Stability is also increasing in our largest project, Karlatornet, which is growing steadily upwards by one story a week. This has not been slowed by the current construction of the tower's twist, in which the entire building turns a quarter of a turn, giving the building its characteristic profile. At the time of writing, 20 stories remain before reaching the top.
When we return after our well-deserved summer break, I look forward to being able to present our forwardlooking ambitions in more concrete terms. In parallel with our focus on stability and profitability, we have been developing our strategy for maintaining the company's long-term relevance in an ever-changing world. Based on a strong culture and employees who seek to always improve, we will remain a driving force for development, both in our industry and in society.
Michael Berglin, President and CEO
| Jan– | Jan– | |||||
|---|---|---|---|---|---|---|
| Apr–Jun | Apr–Jun | Jan–Jun | Jun | Jul–Jun | Dec | |
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 |
| Operating profit | 61 | 108 | 97 | 139 | 193 | 235 |
| Net financial items | 4 | 3 | 6 | 10 | 17 | 21 |
| Earnings after financial items | 65 | 111 | 103 | 149 | 210 | 256 |
| Tax | 7 | 67 | 24 | 75 | 42 | 93 |
| Profit/loss for the period | 72 | 178 | 127 | 224 | 252 | 349 |
Consolidated income amounted to SEK2,658million (2,274), an increase of 17percent. Business Area Sweden's income increased by 34percent to SEK2,709million (2,019) Business Area Invest's income increased to SEK472million (447). The increase in Sweden is explained by Karlatornet being in full production and by projects included in previously divested portfolios also being produced at a high rate. The increase in Invest is mainly related to the sale of the second part of the Auriga block to the Karlastaden Group AB joint venture.
Operating profit amounted to SEK61million (108), with Business Area Invest contributing most through its sale of the second part of the Auriga block to the Karlastaden Group AB joint venture.
Net financial items amounted to SEK4million (3). During the quarter, borrowing expenses of SEK9million (14) on project properties were capitalized.
The Group reported an estimated tax income of SEK7million (expense 67). The positive tax effect for the period is primarily explained by non-taxable income and deferred tax effects of transactions.
Profit for the period amounted to SEK72million (178) and earnings per share after dilution for the quarter were SEK2.54 (6.37).
Consolidated income amounted to SEK4,710million (4,224), an increase of 12percent. Business Area Sweden increased its income by 25percent to SEK4,735million (3,789). The increase in Sweden is explained by Karlatornet being in full production and by projects included in previously divested portfolios also being produced at a high rate. Business Area Invest's income increased to SEK973million (784), with the increase consisting primarily of, for example, the sale of parts 1 and 2 of the Auriga block to the Karlastaden Group AB joint venture, but also of construction income of SEK487million for the Karlatornet AB joint venture. Group-internal eliminations amounted to SEK1,090million and pertained primarily to internal deliveries to Karlastaden.
Operating profit amounted to SEK97million (139), with Business Area Invest contributing most through its sale of parts 1 and 2 of the Auriga block to the joint venture Karlastaden Group AB.
Net financial items amounted to SEK6million (10). The decrease is mainly attributable to increased interest expenses on borrowings. During the period, borrowing expenses of SEK9million (26) on project properties were capitalized.
The Group reported an estimated tax income of SEK24million (expense 75). The positive tax effect for the period is primarily explained by non-taxable income and deferred tax effects of transactions.
Profit for the period amounted to SEK127million (224) and earnings per share after dilution for the period were SEK4.49 (8.02).
In the Tamarinden district, we have developed and sold 139 rental apartments that we will now construct. Tamarinden aims to become one of Sweden's first truly climate-smart residential areas. In the district as a whole, a total of 700 homes, a preschool, several parks, and business premises are to be constructed.
4 | SERNEKE
| Jun 30 | Jun 30 | Dec 31 | |
|---|---|---|---|
| SEK million | 2022 | 2021 | 2021 |
| Total assets | 6,873 | 6,297 | 6,914 |
| Total equity | 2,602 | 2,340 | 2,467 |
| Net debt | -1,466 | -206 | -873 |
| Net debt/EBITDA | -5.4 | -2.2 | -2.8 |
| Cash and cash equivalents | 371 | 335 | 575 |
| Equity/assets ratio, % | 37.9 | 37.2 | 35.7 |
As of June 30, the consolidated balance sheet total amounted to SEK6,873million (6,914) and the equity/assets ratio was 37.9percent (35.7). At the end of the period, cash and cash equivalents amounted to SEK371million (575), with the Group also having a credit facility of SEK500million, with SEK76million of this being used of for guarantees issued. At the end of the period, available cash and cash equivalents totaled SEK771million (775). The Group also holds granted but unused building credits of SEK772million, meaning that financing for future projects developed in-house is secured. Additionally, the joint venture Karlatornet AB, which is owned 50-percent by Serneke, has a granted but unused building credit of SEK1,504million.
As of June 30, equity amounted to SEK2,602million (2,467). The change comprises profit for the period of SEK127million and share-based compensation of SEK8million.
At June 30, net borrowing amounted to SEK1,466million (873). The main changes relate to the amortization of bonds for SEK500million, in connection with which, a long-term bank loan was raised for the corresponding amount. In addition, non-current interest-bearing receivables increased by SEK485million in connection with sales to the Karlastaden Group AB joint venture.
Interest-bearing receivables amounted to SEK2,432million, mainly comprising receivables incurred in connection with Serneke and Balder entering into transactions regarding the Karlastaden district.
| Net debt SEK million |
Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Bank loans | 648 | 220 | 210 |
| Utilized bank overdraft facility | - | - | - |
| Construction credits, housing cooperative projects |
97 | 104 | 269 |
| Bonds | 0 | 514 | 516 |
| Financial lease liabilities | 91 | 74 | 84 |
| Additional lease liabilities, IFRS 16 | 226 | 272 | 248 |
| Loans from the Swedish Tax Agency | 275 | 275 | 275 |
| Other interest-bearing liabilities | - | - | - |
| Interest-bearing receivables | -2,432 | -1,330 | -1,900 |
| Cash and cash equivalents | -371 | -335 | -575 |
| Net debt | -1,466 | -206 | -873 |
The equity/assets ratio shall exceed 30percent. The return on equity shall exceed 15percent.
Return on Equity
The operating margin shall exceed 6percent. Positive operating cash flow each quarter on a rolling six-month basis.
Operating margin rolling 12 Target ≥ 6%
Operating cash flow
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Cash flow from operating activities | -227 | 50 | -232 | 48 | -165 | 115 |
| Cash flow from investment activities | -35 | 41 | -43 | 41 | -64 | 20 |
| Cash flow from financing activities | 86 | -44 | 71 | 12 | 265 | 206 |
| Cash flow for the period | -176 | 47 | -204 | 101 | 36 | 341 |
| Cash and cash equivalents at beginning of period |
547 | 288 | 575 | 234 | 335 | 234 |
| Cash and cash equivalents at end of period |
371 | 335 | 371 | 335 | 371 | 575 |
Cash flow from operating activities amounted to an outflow of SEK227million (inflow 50), of which cash flow from changes in working capital amounted to an outflow of SEK202million (inflow 50). Most of the negative change over the period was attributable to accruals on accounts receivable and accounts payable.
Cash flow from investing activities amounted to an outflow of SEK35million (inflow 41), mainly comprising receivables arising in connection with the sale of the Auriga block in Karlastaden, dividends from associated companies and proceeds from divestments of tangible fixed assets.
Cash flow from financing activities amounted to an inflow of SEK86million (outflow 44) and is mainly attributable to loan repayments, loans raised and payments to housing cooperatives.
Cash flow for the period amounted to an outflow of SEK176million (inflow 47).
Cash flow from operating activities amounted to an outflow of SEK232million (inflow 48), of which cash flow from changes in working capital amounted to an outflow of SEK98million (inflow 45).
Cash flow from investing activities amounted to an outflow of SEK43million (inflow 41), mainly attributable to receivables arising in connection with the sale of the Auriga block in Karlastaden, dividends from associated companies and proceeds from divestments of tangible fixed assets.
Cash flow from financing activities amounted to an inflow of SEK71million (12), which is primarily explained by loan repayments made in the amount of SEK876million, of which SEK500million consisted of bonds amortizations. New loans have been raised in the amount of SEK782million and contributions of SEK166million have been paid in to tenant-owner associations.
Cash flow for the period amounted to an outflow of SEK204million (inflow 101).
The Serneke Group is divided into three segments: Sweden, Invest and International, which are reported as individual operating segments.
Business Area Sweden conducts contracting operations in the areas of construction, civil engineering, and infrastructure, as well as project development operations by developing project and development properties. The business area conducts construction contracting for both external customers, as well as Business Area Invest.
Business Area Invest conducts development projects with a higher degree of complexity, a higher transaction risk and a greater need for capital to be tied up. The business area generates internal assignments for Serneke Sweden's contracting operations.
Business Area International brings the Group's international investments together. The business area is currently in a start-up phase, consisting primarily of an ongoing initiative in project exports. Due to its current scope, the segment will not be described in this report, other than in the tables below on this page and in the "multi-year overview" on page 18.
Other operations are reported under Group-wide, which primarily comprises Group functions and Group-wide provisions.
SALES
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Sweden | 2,709 | 2,019 | 4,735 | 3,789 | 9,049 | 8,103 |
| Invest | 472 | 447 | 973 | 784 | 1,875 | 1,686 |
| International | 0 | 0 | 0 | 0 | 0 | 0 |
| Group-wide | 46 | 33 | 92 | 66 | 181 | 155 |
| Eliminations | -569 | -225 | -1,090 | -415 | -1,884 | -1,209 |
| Total | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 |
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Sweden | 22 | 14 | 32 | 4 | 85 | 57 |
| Invest | 69 | 167 | 129 | 237 | 211 | 319 |
| International | -4 | -4 | -11 | -8 | -21 | -18 |
| Group-wide | -5 | -59 | -16 | -76 | -12 | -72 |
| Eliminations | -21 | -10 | -37 | -18 | -70 | -51 |
| Total | 61 | 108 | 97 | 139 | 193 | 235 |
*The comparative figures have been recalculated in accordance with the new segment reporting
To a certain extent, Serneke's operations are subject to seasonal effects. The contracting operations normally experience lower activity in the first quarter of the year due to fewer production days and, to a greater extent than normal, the weather during the winter months. Earnings are also affected by where public holidays fall, as this affects the number of production days.
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 2,709 | 2,019 | 4,735 | 3,789 | 9,049 | 8,103 |
| Operating profit | 22 | 14 | 32 | 4 | 85 | 57 |
| Operating margin, % | 0.8 | 0.7 | 0.7 | 0.1 | 0.9 | 0.7 |
Income amounted to SEK2,709million (2,019), an increase of 34percent. The increase is mainly attributable to Karlatornet being in full production, while projects previously included in divested project portfolios were also produced at a high pace compared with the corresponding quarter in the preceding year.
Operating profit amounted to SEK22million (14) and the operating margin was 0.8percent (0.7). The operating profit and operating margin for the quarter were negatively affected by indirect effects associated with the corona pandemic, as well as price increases in the market as a result of the unease in Europe and the inflation trend. Compared with the preceding year, operating profit for the quarter shows financial
development in the right direction, with this having been the fifth consecutive quarter in profit.
Income amounted to SEK4,735million (3,789), an increase of 25percent. The increase is mainly attributable to Karlatornet having been in full production over most of the year, while projects previously included in divested portfolios were also produced at a high pace compared with the corresponding period in the preceding year.
Operating profit amounted to SEK32million (4) and the operating margin was 0.7percent (0.1). Both operating profit and the operating margin for the period reflect a trend in the right direction.
In June, Serneke sold the Norrköping District Court project to Vacse and commenced construction. In total, the property transaction and the contracting agreement are valued at about SEK246million. The new District Court is scheduled for completion in the spring of 2024.
| Order bookings | Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2020/2021 | 2021 |
| Contracting | 1,598 | 2,221 | 3,435 | 3,400 | 6,380 | 6,345 |
| Order backlog | Jun 30 | Jun 30 | Dec 31 | |||
| SEK million | 2022 | 2021 | 2021 | |||
| Contracting | 11,234 | 13,372 | 12,101 |
External order intake for the quarter amounted to SEK1,598million (2,221), which is a decrease of 28percent compared with the corresponding quarter in the preceding year.
Among the assignments secured during the quarter, the emphasis is primarily on housing, but also on public properties. The quarter's largest order amounted to SEK206million and involves a turnkey contract signed with CapMan for the development of a climate-smart residential area in Örebro. The project is scheduled for completion in the fourth quarter of 2024.
Development in the market and future prospects have shifted towards a higher degree of uncertainty, requiring continued vigilance.
Underlying demand remains, although reflecting a certain shift from private clients for residential projects to local government clients, with increased orders for public spaces and public properties.
The external order backlog at the end of the second quarter amounted to SEK11,234million (13,372). This entails a decrease of 16percent compared with the corresponding quarter in the preceding year.
Of the order backlog for the upcoming years, green projects account for SEK4,970million. The projects involve constructing properties in accordance with established certification requirements that agree with Serneke's green framework.
31 mar 30 jun 30 sep 31 dec
Public purchaser Private purchaser
| Assignment | Location | Order value (SEK million) |
(Anticipated) start of construction |
|---|---|---|---|
| Housing | Örebro | 206 | Second quarter 2022 |
| Public properties | Norrköping | 175 | Second quarter 2022 |
| Office | Stockholm | 136 | Third quarter 2022 |
| Housing | Skövde | 123 | Fourth quarter 2022 |
At the time of this report, some 20 stories remain before the Karlatornet tower reaches its full height of 73 stories. The tower continues to grow by about one story a week. Photo: Kasper Dudzik
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 472 | 447 | 973 | 784 | 1,875 | 1,686 |
| Share in profit of associates and joint | ||||||
| ventures | 1 | 2 | 5 | 7 | -8 | -6 |
| Operating profit | 69 | 167 | 129 | 237 | 211 | 319 |
| Operating margin, % | 14.6 | 37.4 | 13.3 | 30.2 | 11.3 | 18.9 |
| In-house-developed tenant-owner housing production projects | June 30 2022 |
June 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Number of housing units under construction during the year | 18 | 65 | 144 |
| Number of housing units sold during the year | 88 | 20 | 65 |
| Total number of housing units under construction at the end of the period | 402 | 477 | 532 |
| Number of repurchased housing units on the Company's own balance sheet at the end of the period |
12 | 3 | 0 |
*Comparative figures have been adjusted to include previous balances from the Sweden segment. See page 11
The business area's income amounted to SEK472million (447) with the increase consisting primarily of the sale of the second part of the Auriga block to the joint venture Karlastaden Group AB, as well as of contracting income for Karlatornet AB (joint venture).
The share in the profit of associates and joint ventures amounted to SEK1million (2).
Operating profit amounted to SEK69million (167). The positive operating profit is mainly explained by the sale of the second part of the Auriga block to the joint venture Karlastaden Group AB.
As of June 30, 2022, the total book value of Invest's project development portfolio amounted to SEK1,402million.
| Development rights | June 30 | June 30 | Dec 31 |
|---|---|---|---|
| Number (GFA) | 2022 | 2021 | 2021 |
| Development rights on own balance sheet |
136,622 | 230,787 | 196,624 |
| Development rights through joint ventures |
129,360 | 50,400 | 81,854 |
| Agreed development rights not yet taken into possession |
567,357 | 560,442 | 582,436 |
| Total | 833,339 | 841,629 | 860,913 |
Income amounted to SEK973million (784), with the increase primarily being attributable to the sale of parts 1 and 2 of the Auriga block to the Karlastaden Group AB joint venture. Contracting income of SEK487million in the Karlatornet AB joint venture contributed to the positive increase for the period. Additionally, income also comprises contracting income from the manufacture and assembly of steel pipe structures, property sales, as well as hotel revenues.
The share in the profit of associates and joint ventures amounted to SEK5million (7).
Operating profit amounted to SEK129million (237). The positive operating profit is mainly explained by the sale of parts 1 and 2 of the Auriga block to the Karlastaden Group AB joint venture. Hotel operations were also affected positively, with increased activity following the ending of the corona pandemic restrictions.
The operations of Serneke Group AB (publ) consist mainly of Group Management and Group-wide services.
Income for April-June amounted to SEK47million (34) and consisted primarily of intra-group services. The operating loss for the same period amounted to SEK5million (0).
Income for the period January–June amounted to SEK93million (67) and the operating profit was SEK2million (loss 11).
The Parent Company is indirectly affected by the risks described in the section Significant risks and uncertainty factors.
The nature and extent of transactions by related parties can be found in Note 33 of the 2021 Annual Report. During the year, related party transactions have occurred with Lommen Sjöbefälet AB, Kongahälla Shopping AB, Ola Serneke Holding AB, Kviberg Skidanläggning AB, Limestone Management AB, JV Sersund AB, JV Karlatornet AB, JV Karlastaden Group AB and the associated company Änglagården. Transactions with related parties have been made on market terms.
Transactions with Lommen Sjöbefälet AB are considered to be related party transactions as the Company's main owner, Ludwig Mattsson, is a member of the Board of Serneke Group AB. The transactions consist primarily of the rent for Serneke's head office and purchases amounting to SEK6.6million. Transactions with Kongahälla Shopping AB are considered to be related party transactions as the Company's main owner, Ludwig Mattsson, is a member of the Board of Serneke Group AB. The transactions primarily involve contracting income amounting to SEK1.8million.
Transactions with Ola Serneke Holding AB are considered to be related party transactions as Ola Serneke is the principal shareholder in Serneke Group AB. Purchasing amounted to SEK0.4million. The transactions mainly comprise income/expenses relating to the settlement of the assets that took place in 2020 between Serneke and Kviberg Skidanläggning AB, which is owned by Ola Serneke Holding AB, and are thus considered to be related party transactions. Transactions with Limestone Management AB, Per Åkerman's consulting company, are considered to be related party transactions as Per
Åkerman is a member of the Board of the Company. The transactions relate to consultancy fees of SEK0.4million for tasks beyond the Board assignment. Transactions with Sersund AB (joint venture) are considered to be related party transactions as Serneke holds 50percent of Sersund and the transactions consist mainly of income of SEK8.7million from contracting services. Transactions with Karlatornet AB (joint venture) are considered to be related party transactions as Serneke owns 50percent of Karlatornet AB as of December 17, 2020. The transactions primarily involve contracting income of SEK558.9million. Transactions with Karlastaden Group (JV) are considered to be related party transactions as Serneke owns 50percent of Karlastaden Group AB. The transactions primarily involve contracting income of SEK135.1million. Transactions with the associated company Änglagården are considered to be related party transactions as Serneke owns 40percent of Änglagården. The transactions primarily involve outsourcing of staff, rent for premises and rent for the arena, respectively. Income amounted to SEK2.2million and purchases to SEK14.3million
Serneke's operations entail several types of risks, both operational and financial. Operational risks are related to the daily operations and can apply to tenders or project development, assessment of profits, risks linked to production or the price trend. Operational risks are managed by the internal business management that has been developed within the Group. Identifying and managing Serneke's risks is crucial to the Group's profitability. Each segment manages its risks based on the business management and developed procedures and processes. Serneke's financial risks such as interest rate, liquidity, financing and credit risks are managed centrally in order to minimize and control risk exposure. The liquidity situation is assessed on an ongoing basis by the Board and Group Management. Work with sales of the Group's project portfolio is part of Serneke's operations and continues to balance, for example, capital tied up, and to free up liquidity. The Board's assessment is that Serneke acts on the basis of good rules of procedure and ensures that sufficient liquidity is obtained to safeguard its continued operation.
For further information on risks, as well as critical estimates and assessments, see the Board of Directors' Report and Notes 3 and 4 in the 2021 Annual Report. The descriptions in the Annual Report remain relevant. The Annual Report is published at www.serneke.group.
Serneke is monitoring the continued development of the corona virus pandemic closely to assess its effects in the short and long term.
Russia's invasion of Ukraine in February 2022 intensified the effects on the global economy that became apparent during the corona pandemic. The sanctions against Russia and Belarus introduced as a result of the war and the widespread uncertainty in the global economy are affecting the supply and transport of materials, as well as purchasing prices.
During the period, inflation and interest rates also shifted sharply, which could have an impact in the future through further increased prices and subdued demand.
No significant events have occurred after the end of the reporting period.
Serneke Group AB has two share series, Series A and B. On June 30, 2022, Serneke had approximately 7,130 shareholders and the closing price on June 30, 2022, was SEK36.4.
| Total number | Percentage of shares |
Percentage | |||
|---|---|---|---|---|---|
| Series A shares | Series B shares | of shares | outstanding, % | of votes, % | |
| Ola Serneke Holding AB | 3,710,000 | 2,430,526 | 6,140,526 | 21.69% | 52.57% |
| Lommen Holding AB | 540,000 | 3,646,482 | 4,186,482 | 14.79% | 12.03% |
| Christer Larsson i Trollhättan AB | 380,000 | 507,000 | 887,000 | 3.13% | 5.73% |
| Ledge Ing AB | 330,000 | 450,000 | 780,000 | 2.76% | 4.99% |
| Vision Group i väst AB | 250,000 | 550,662 | 800,662 | 2.83% | 4.06% |
| Fastighets AB Balder | 0 | 2,300,000 | 2,300,000 | 8.13% | 3.06% |
| Svolder Aktiebolag | 0 | 2,077,608 | 2,077,608 | 7.34% | 2.76% |
| Försäkringsaktiebolaget Avanza | 0 | 1,147,694 | 1,147,694 | 4.05% | 1.53% |
| Mediuminvest AS | 0 | 733,058 | 733,058 | 2.59% | 0.97% |
| Novobis AB | 0 | 366,708 | 366,708 | 1.30% | 0.49% |
| Total, 10 largest | 5,210,000 | 14,209,738 | 19,419,738 | 68.60% | 88.18% |
| Other shareholders | 0 | 8,886,967 | 8,886,967 | 31.40% | 11.82% |
| Total shares outstanding | 5,210,000 | 23,096,705 | 28,306,705 | 100.00% | 100.00% |
| Repurchased shares | 0 | 446,527 | 446,527 | ||
| Total shares registered | 5,210,000 | 23,543,232 | 28,753,232 |
Source: Euroclear and Serneke
Share series, number of shares and votes, Jun 30, 2022.
| Share class | Shares | Votes excluding own holding |
|---|---|---|
| Series A shares | 5,210,000 | 5,210,000 |
| Series B shares | 23,096,705 | 2,309,670.50 |
| Total | 28,306,705 | 7,519,670.50 |
| Own holding | 446,527 | |
| Total number | 28,753,232 | |
| Share class | Shares | Votes |
|---|---|---|
| Series A shares | 5,210,000 | 5,210,000 |
| Series B shares | 23,543,232 | 2,354,323.20 |
| Total | 28,753,232 | 7,564,323.20 |
Interim Report January–September 2022 October 27, 2022 Year-end report 2022 February 8, 2023
The Board hereby certifies that this interim report provides a fair overview of the operations, position and earnings of the Parent Company and the Group and describes the significant risks and uncertainties that Serneke faces.
This report has not been reviewed by the Company's auditors.
Gothenburg, July 15, 2022 Serneke Group AB (publ)
Board of Directors
Jan C. Johansson Chairman
Mari Broman Member
Ludwig Matsson Member
Veronica Rörsgård Member
Per Åkerman Member
Fredrik Alvarsson Member
Lars Kvarnsund Member
Michael Berglin, President and CEO e-mail: [email protected] Phone: +46 (0) 31712 97 00
Anders Düring, CFO E-mail: [email protected] Phone:: +46 (0)70 88 87 733
This information is such that Serneke Group AB (publ) is obliged to publish pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication on July 15, 2022, at 08:00 a.m. CET
| Apr– | Apr– | |||||||
|---|---|---|---|---|---|---|---|---|
| Jun | Jan–Mar | Oct–Dec | Jul–Sep | Jun | Jan–Mar | Oct–Dec | Jul–Sep | |
| SEK million | 2022 | 2022 | 2021 | 2021 | 2021 | 2021 | 2020 | 2020 |
| Income | ||||||||
| Sweden | 2,709 | 2,026 | 2,389 | 1,925 | 2,019 | 1,770 | 2,025 | 1,592 |
| Invest | 472 | 501 | 580 | 322 | 447 | 337 | 223 | 28 |
| International | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Group-wide | 46 | 46 | 42 | 46 | 33 | 33 | 17 | 20 |
| Eliminations | -569 | -521 | -468 | -325 | -225 | -190 | -99 | -142 |
| Total | 2,658 | 2,052 | 2,543 | 1,968 | 2,274 | 1,950 | 2,166 | 1,498 |
| Operating profit | ||||||||
| Sweden | 22 | 10 | 32 | 21 | 14 | -10 | -65 | -62 |
| Invest | 69 | 60 | 74 | 7 | 167 | 71 | -4 | -10 |
| International | -4 | -5 | -5 | -4 | -4 | -4 | -3 | -3 |
| Group-wide | -5 | -11 | -11 | 15 | -59 | -17 | -6 | 0 |
| Eliminations | -21 | -18 | -19 | -14 | -10 | -9 | 31 | -4 |
| Total | 61 | 36 | 71 | 25 | 108 | 31 | -47 | -79 |
| Operating margin, % | 2.3 | 1.8 | 2.8 | 1.3 | 4.7 | 1.6 | -2.2 | -5.3 |
| Profit after net financial | ||||||||
| items | 65 | 38 | 74 | 33 | 111 | 38 | -119 | -82 |
| Profit/loss for the period | 72 | 55 | 87 | 37 | 178 | 46 | -72 | -66 |
| Balance sheet | ||||||||
| Fixed assets | 3291 | 2894 | 2725 | 2655 | 2522 | 2158 | 2156 | 757 |
| Current assets | 3582 | 4052 | 4189 | 3810 | 3775 | 3807 | 3836 | 4962 |
| Total assets | 6,873 | 6,946 | 6,914 | 6,465 | 6,297 | 5,965 | 5,992 | 5,719 |
| Shareholders' equity | 2,602 | 2,527 | 2,467 | 2,372 | 2,340 | 2,161 | 1,946 | 1,896 |
| Non-current liabilities | 1,449 | 752 | 740 | 1,200 | 1,177 | 1,182 | 1,058 | 1,245 |
| Current liabilities | 2,822 | 3,667 | 3,707 | 2,893 | 2,780 | 2,622 | 2,988 | 2,578 |
| Total equity and liabilities |
6,873 | 6,946 | 6,914 | 6,465 | 6,297 | 5,965 | 5,992 | 5,719 |
| Orders | ||||||||
| Order bookings | 1,598 | 1,837 | 1,749 | 1,196 | 2,221 | 1,179 | 4,852 | 961 |
| Order backlog | 11,234 | 11,966 | 12,101 | 12,642 | 13,372 | 13,126 | 13,619 | 10,623 |
| Employees Average number of employees |
1,304 | 1,269 | 1,208 | 1,205 | 1,189 | 1,174 | 1,161 | 1,180 |
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 |
| Earnings per share, SEK, before dilution | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Earnings per share, SEK, after dilution | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Weighted average number of shares before dilution | 28,306,705 | 27,938,245 | 28,269,271 | 27,938,245 | 28,127,733 | 27,962,221 |
| Weighted average number of shares after dilution | 28,306,705 | 27,938,245 | 28,269,271 | 27,938,245 | 28,127,733 | 27,962,221 |
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Operating profit | 61 | 108 | 97 | 139 | 193 | 235 |
| Growth, % | 16.9 | 63.2 | 11.5 | 31.7 | 16.9 | 27.1 |
| Order bookings | 1,598 | 2,221 | 3,435 | 3,400 | 6,380 | 6,345 |
| Order backlog | 11,234 | 13,372 | 11,234 | 13,372 | 11,234 | 12,101 |
| Organic growth, % | 16.9 | 63.2 | 11.5 | 31.7 | 16.9 | 27.1 |
| Operating margin, % | 2.3 | 4.7 | 2.1 | 3.3 | 2.1 | 2.7 |
| Cash flow before financing | -262 | 91 | -275 | 89 | -229 | 135 |
| Cash flow from operations per share, before dilution |
-8.02 | 1.79 | -8.21 | 1.72 | -5.87 | 4.11 |
| Cash flow from operations per share, after dilution |
-8.02 | 1.79 | -8.21 | 1.72 | -5.87 | 4.11 |
| Equity per share, SEK, before dilution | 91.92 | 83.76 | 91.92 | 83.76 | 91.92 | 87.85 |
| Equity per share, SEK, after dilution | 91.92 | 83.76 | 91.92 | 83.76 | 91.92 | 87.85 |
| Working capital | 760 | 995 | 760 | 995 | 760 | 482 |
| Capital employed | 3,807 | 3,710 | 3,807 | 3,710 | 3,807 | 3,961 |
| Return on capital employed, % | 7.1 | 1.1 | 7.1 | 1.1 | 7.1 | 7.8 |
| Return on equity after taxes, % | 10.2 | 4.0 | 10.2 | 4.0 | 10.2 | 15.8 |
| Equity/assets ratio, % | 37.9 | 37.2 | 37.9 | 37.2 | 37.9 | 35.7 |
| Net debt | -1,466 | -206 | -1,466 | -206 | -1,466 | -873 |
| Net debt/equity ratio, % | -56.3 | -8.8 | -56.3 | -8.8 | -56.3 | -35.4 |
| Net debt/EBITDA | -5.4 | -2.2 | -5.4 | -2.2 | -5.4 | -2.8 |
| Statement | ||||||
|---|---|---|---|---|---|---|
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 |
| Production and administration expenses | -2,528 | -2,145 | -4,488 | -4,027 | -8,805 | -8,344 |
| Gross profit | 130 | 129 | 222 | 197 | 416 | 391 |
| Sales and administration expenses | -51 | -32 | -93 | -67 | -176 | -150 |
| The effect on profit of establishing the joint | ||||||
| venture | 0 | 0 | 0 | 0 | 0 | 0 |
| Share in profit of associates and joint ventures | -18 | 11 | -32 | 9 | -47 | -6 |
| Operating profit | 61 | 108 | 97 | 139 | 193 | 235 |
| Net financial items | 4 | 3 | 6 | 10 | 17 | 21 |
| Profit after financial items | 65 | 111 | 103 | 149 | 210 | 256 |
| Tax | 7 | 67 | 24 | 75 | 42 | 93 |
| Profit/loss for the period | 72 | 178 | 127 | 224 | 252 | 349 |
| Attributable to: | ||||||
| Parent Company shareholders | 72 | 178 | 127 | 224 | 252 | 349 |
| Non-controlling interests | 0 | 0 | 0 | 0 | 0 | 0 |
| Earnings per share before dilution, SEK | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Earnings per share after dilution, SEK | 2.54 | 6.37 | 4.49 | 8.02 | 8.96 | 12.48 |
| Average number of shares before dilution | 28,306,705 | 27,938,245 | 28,269,271 | 27,938,245 | 28,127,733 | 27,962,221 |
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Jan–Dec | |
|---|---|---|---|---|---|---|
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Profit/loss for the period | 72 | 178 | 127 | 224 | 252 | 349 |
| Other comprehensive income | 0 | 0 | 0 | 0 | 0 | 0 |
| Total comprehensive income | 72 | 178 | 127 | 224 | 252 | 349 |
| Jun 30 | Jun 30 | Dec 31 | |
|---|---|---|---|
| SEK million | 2022 | 2021 | 2021 |
| Assets | |||
| Fixed assets | |||
| Intangible fixed assets | 26 | 24 | 25 |
| Other tangible fixed assets | 332 | 389 | 351 |
| Investments in associates/joint ventures | 166 | 151 | 160 |
| Deferred tax assets | 132 | 89 | 108 |
| Non-current interest-bearing receivables | 2,432 | 1,330 | 1,900 |
| Other non-current receivables | 203 | 539 | 181 |
| Total fixed assets | 3,291 | 2,522 | 2,725 |
| Current assets | |||
| Project and development properties | 1,376 | 1,555 | 1,704 |
| Inventories | 2 | 1 | 1 |
| Accounts receivable | 1,075 | 983 | 966 |
| Accrued but not invoiced income | 524 | 446 | 555 |
| Other current receivables | 234 | 455 | 388 |
| Cash and bank balances | 371 | 335 | 575 |
| Total current assets | 3,582 | 3,775 | 4,189 |
| Total assets | 6,873 | 6,297 | 6,914 |
| Equity and liabilities | |||
| Shareholders' equity | 2,602 | 2,340 | 2,467 |
| Non-current liabilities | |||
| Non-current interest-bearing liabilities | 1,190 | 935 | 467 |
| Other non-current liabilities | 72 | 33 | 71 |
| Deferred tax liability | 0 | 0 | 0 |
| Other provisions | 187 | 209 | 202 |
| Total non-current liabilities | 1,449 | 1,177 | 740 |
| Current liabilities | |||
| Current interest-bearing liabilities | 147 | 524 | 1,135 |
| Current tax liabilities | 0 | 0 | 0 |
| Accounts payable | 1,391 | 1,025 | 1,344 |
| Invoiced but not accrued income | 811 | 816 | 744 |
| Other current liabilities | 473 | 415 | 484 |
| Total current liabilities | 2,822 | 2,780 | 3,707 |
| SEK million | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Equity attributable to Parent Company shareholders | |||
| Balance at beginning of period | 2,467 | 1,946 | 1,946 |
| New share issue | 167 | 166 | |
| Share-related compensation | 8 | 3 | 6 |
| Other | - | - | |
| Transactions with non-controlling interests | - | - | |
| Changed accounting policy | - | - | |
| Comprehensive income for the period | 127 | 224 | 349 |
| Non-controlling interests | |||
| Acquisition of non-controlling interests | - | - | |
| Comprehensive income for the period | 0 | - | |
| Balance at end of period | 2,602 | 2,340 | 2,467 |
| SEK million | Apr–Jun 2022 |
Apr–Jun 2021 |
Jan–Jun 2022 |
Jan–Jun 2021 |
Jul–Jun 2021/2022 |
Jan–Dec 2021 |
|---|---|---|---|---|---|---|
| Operating activities | ||||||
| Cash flow before change in working capital | -25 | 0 | -134 | 3 | -1 | 136 |
| Change in working capital | -202 | 50 | -98 | 45 | -165 | -22 |
| Cash flow from operating activities | -227 | 50 | -232 | 48 | -165 | 115 |
| Investing activities | ||||||
| Increase/decrease in investing activities | -35 | 41 | -43 | 41 | -64 | 20 |
| Cash flow from investing activities | -35 | 41 | -43 | 41 | -64 | 20 |
| Cash flow before financing | -262 | 91 | -275 | 89 | -229 | 135 |
| Financing activities | ||||||
| Newly raised borrowings | 694 | 172 | 782 | 208 | 1,000 | 426 |
| New share issue | 0 | 0 | 0 | 167 | 0 | 167 |
| Amortization of liabilities | -729 | -217 | -876 | -365 | -968 | -457 |
| Dividend | 0 | 0 | 0 | 0 | 0 | 0 |
| Increase/decrease in financing activities | 121 | 1 | 165 | 2 | 233 | 70 |
| Cash flow from financing activities | 86 | -44 | 71 | 12 | 265 | 206 |
| Cash flow for the period | -176 | 47 | -204 | 101 | 36 | 341 |
| Cash and cash equivalents at beginning of period |
547 | 288 | 575 | 234 | 335 | 234 |
| Cash and cash equivalents at end of period |
371 | 335 | 371 | 335 | 371 | 575 |
| Jan– | ||||||
|---|---|---|---|---|---|---|
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Dec | |
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Income | 47 | 34 | 93 | 67 | 181 | 155 |
| Sales and administration expenses | -52 | -34 | -91 | -78 | -170 | -157 |
| Operating profit | -5 | 0 | 2 | -11 | 11 | -2 |
| Net financial items | -10 | -21 | -26 | -39 | -56 | -69 |
| Profit after financial items | -15 | -21 | -24 | -50 | -45 | -71 |
| Appropriations | 0 | 0 | 0 | 0 | 0 | 0 |
| Profit/loss before tax | -15 | -21 | -24 | -50 | -45 | -71 |
| Tax | 2 | 4 | 3 | 9 | -5 | 1 |
| Profit/loss for the period | -13 | -17 | -21 | -41 | -50 | -70 |
| Jan– | ||||||
|---|---|---|---|---|---|---|
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Dec | |
| SEK million | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 |
| Profit/loss for the period | -13 | -17 | -21 | -41 | -50 | -70 |
| Other comprehensive income | 0 | 0 | 0 | 0 | 0 | 0 |
| Total comprehensive income | -13 | -17 | -21 | -41 | -50 | -70 |
| SEK million | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Assets | |||
| Fixed assets | |||
| Tangible fixed assets | 9 | 7 | 8 |
| Investments in Group companies | 395 | 309 | 360 |
| Deferred tax assets | 17 | 22 | 14 |
| Other non-current receivables | 3 | 3 | 3 |
| Total fixed assets | 424 | 341 | 385 |
| Current assets | |||
| Project and development properties | 2 | 2 | 2 |
| Other current receivables | 934 | 1,524 | 1,498 |
| Cash and bank balances | 154 | 145 | 313 |
| Total current assets | 1,090 | 1,671 | 1,813 |
| Total assets | 1,514 | 2,012 | 2,198 |
| Equity and liabilities | |||
| Shareholders' equity | 516 | 556 | 530 |
| Non-current liabilities | |||
| Non-current interest-bearing liabilities | 8 | 516 | 3 |
| Other provisions | 1 | 2 | 2 |
| Total non-current liabilities | 9 | 518 | 5 |
| Current liabilities | |||
| Current interest-bearing liabilities | 2 | 7 | 523 |
| Accounts payable | 11 | 8 | 8 |
| Other current liabilities | 976 | 923 | 1,132 |
| Total current liabilities | 989 | 938 | 1,663 |
| Total equity and liabilities | 1,514 | 2,012 | 2,198 |
This interim report has been prepared in accordance with IAS 34, Interim Financial Reporting. The Interim Report has been prepared in accordance with International Financial Reporting Standards (IFRS), as well as interpretations of current International Financial Reporting Interpretations Committee (IFRIC) standards as adopted by the EU. The Parent Company's reports have been prepared in compliance with the Annual Accounts Act and the Financial Reporting Board's recommendation RFR 2, Accounting for Legal Entities. ESMA's guidelines on alternative key indicators are applied in the report.
The Interim Report has been prepared in accordance with the same accounting principles and calculation methods as in the 2020 Annual Report. For detailed information regarding accounting policies, see Serneke's 2020 Annual Report, see www.serneke.se.
Financial assets and financial liabilities measured at fair value in the balance sheet are classified according to one of three levels based on the information used to establish the fair value. The Group only holds financial assets and liabilities valued in level 3, which is why levels 1 and 2 have been omitted in the table below. No transfers have been made between the levels during the periods. A more detailed description of the levels can be found in Note 4 of the 2021 Annual Report.
Level 1 – Valuation is made according to prices in active markets for identical instruments.
Level 2 – Financial instruments for which the fair value is established based on valuation models that are based on observable data for the asset or liability other than quoted prices included in Level 1.
Level 3 – Financial instruments for which fair value is established based on valuation models where significant inputs are based on non-observable data.
| Group SEK million | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Financial assets | |||
| Non-current interest-bearing receivables* |
2425 | - | 1,893 |
| Available-for-sale financial | |||
| assets** | 2 | 2 | 2 |
| Total financial assets | 2,427 | 2 | 1,895 |
| Financial liabilities | |||
| Other short- and long-term | |||
| liabilities | 10 | 23 | 18 |
| Of which, additional purchase | |||
| considerations*** | 10 | 23 | 18 |
| Total financial liabilities | 10 | 23 | 18 |
* As of June 30, 2022, the shareholder loan for Karlatornet is recognized at SEK1,264million. The remainder of the receivable is attributable to the joint ventures established with Fastighets AB Balder in 2021 and in the second quarter of 2022. ** In the fair value calculation of available-for-sale financial assets at level 3, the market price method has been applied and the yield value assumption has been used. *** In the fair value calculation of the additional purchase considerations at level 3, project estimates, budgets and forecasts have been applied.
For the Group's financial assets and financial liabilities, the reported values are assessed as corresponding to FAIR VALUE. No significant changes in valuation models, assumptions or inputs were made during the period.
The repayment of the financial receivables regarding Karlatornet presupposes that the underlying calculations, which also pertain to the valuation of the underlying assets, proceed in accordance with the forecast and, if a deviation were to occur entailing there being no funds available to enable the payment of the dividend to Balder, Serneke has undertaken to convert the shareholder loan into a contingent shareholder contribution.
The Group pledges collateral for external loans. The Group's contingent liabilities arise primarily in connection with different property disposals, whereby various operational guarantees may occur, as well as performance guarantees for future contracts. Serneke Group AB (publ) has also
entered into a guarantee undertaking, which means that the co-owners in Prioritet Serneke Arena are jointly responsible for the correct fulfillment of interest and repayment of the associate's liabilities to credit institutions in the event that the associate is unable to pay.
Pledged assets and contingent liabilities in the consolidated balance sheet:
| Group | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|---|---|---|---|
| Pledged assets | 2,570 | 2,139 | 2,367 |
| Contingent liabilities | 4,360 | 990 | 2,677 |
| Parent Company | |||
| Pledged assets | 300 | 300 | 300 |
| Contingent liabilities | 7,186 | 2,886 | 4,987 |
| Apr-June 2022, SEK million | Sweden | Invest | International | Group-wide | Eliminations | Total |
|---|---|---|---|---|---|---|
| Construction income | 2,708 | 334 | - | - | -525 | 2,517 |
| Sale of properties and development rights |
0 | 100 | - | - | - | 100 |
| Rental income | 0 | 2 | - | 3 | -3 | 2 |
| Other income | 1 | 36 | - | 43 | -41 | 39 |
| Total income | 2,709 | 472 | 0 | 46 | -569 | 2,658 |
| Date of income recognition: | ||||||
| At a specific time | 1 | 136 | - | 43 | -41 | 139 |
| Over time | 2,708 | 336 | - | 3 | -528 | 2,519 |
| Total income | 2,709 | 472 | 0 | 46 | -569 | 2,658 |
| Apr–Jun 2021, SEK million | Sweden | Invest | International | Group-wide | Eliminations | Total |
| Construction income | 2,014 | 213 | - | - | -192 | 2,035 |
| Sale of properties and development rights |
3 | 43 | - | - | - | 46 |
| Rental income | 0 | 2 | - | 3 | -3 | 2 |
| Other income | 2 | 189 | - | 30 | -30 | 191 |
| Total income | 2,019 | 447 | 0 | 33 | -225 | 2,274 |
| Date of income recognition: | ||||||
| At a specific time | 5 | 232 | - | 30 | -30 | 237 |
| Over time | 2,014 | 215 | - | 3 | -195 | 2,037 |
| Total income | 2,019 | 447 | 0 | 33 | -225 | 2,274 |
| Jan–Jun 2022, SEK million | Sweden | Invest | International | Group-wide | Eliminations | Total |
| Construction income | 4,729 | 708 | - | - | -1,000 | 4,437 |
| Sale of properties and development rights |
214 | - | - | - | 214 | |
| Rental income | 0 | 4 | - | 5 | -5 | 4 |
| Other income | 6 | 47 | - | 87 | -85 | 55 |
| Total income | 4,735 | 973 | 0 | 92 | -1,090 | 4,710 |
| Date of income recognition: | ||||||
| At a specific time | 6 | 261 | - | 87 | -85 | 269 |
| Over time | 4,729 | 712 | - | 5 | -1005 | 4,441 |
| Total income | 4,735 | 973 | 0 | 92 | -1,090 | 4,710 |
| Jan–Jun 2021, SEK million | Sweden | Invest | International | Group-wide | Eliminations | Total | |
|---|---|---|---|---|---|---|---|
| Construction income | 3,781 | 373 | - | - | -349 | 3,805 | |
| Sale of properties and development rights | 3 | 212 | - | - | - | 215 | |
| Rental income | 0 | 4 | - | 6 | -6 | 4 | |
| Other income | 5 | 195 | - | 60 | -60 | 200 | |
| Total income | 3,789 | 784 | 0 | 66 | -415 | 4,224 | |
| Date of income recognition: | |||||||
| At a specific time | 8 | 407 | - | 60 | -60 | 415 | |
| Over time | 3,781 | 377 | - | 6 | -355 | 3,809 | |
| Total income | 3,789 | 784 | 0 | 66 | -415 | 4,224 |
Income from contracting agreements is reported in accordance with IFRS 15 Revenue from Contracts with Customers, either by fulfilling the performance undertaking over time (that is, gradually) or at one specific time. Contracting agreements entail the construction contract being performed on the customer's land, where an asset is created over which the customer gains control in pace with the completion of the asset. This entails income being recognized gradually (over time), applyingpercentage-of-completion. When applyingpercentage-of-completion, the input method applies whereby income is reported based on the degree of completion,
which is calculated as the ratio between the expenses incurred for work performed at the end of reporting period and the estimated total expenses for the assignment. Revaluations of the projects' final forecasts entail corrections of previously accrued profits. If it is probable that the total contract expenses will exceed the total contract income, the anticipated loss should be immediately recognized as a cost in its entirety. Modification and supplementary orders are included in the commission income to the extent that they have been approved by the customer.
On disposal of properties or development rights directly or indirectly through a sale of shares, the underlying property or development right's value is recognized in the Group as income. Income from property sales is reported on gaining access to the property. When agreements include both property sales and building rights,
as well as a contracting agreement for the planned building for the buyer, an assessment is made as to whether the property and/or building rights transactions and the contracting agreement, respectively, are separate performance commitments. Depending on the design and terms of the agreement, the sale can be seen as one or several performance undertakings. Sales are reported at the point in time at which control is transferred to the buyer. Control is transferred over time if the seller has no alternative use for the property sold and the seller is entitled to payment from the customer for the work performed. In such cases, income is reported applyingpercentage of completion. If any of the above criteria are not met, income is reported at a single point in time, on completion and transfer to the customer. Sales of development rights can be dependent upon decisions regarding future detailed development plans. An assessment is then made as to the likelihood of the respective detailed development plan. Sales income and earnings are recognized when the probability is deemed to be very high. When sales income is recognized, all remaining commitments in the sales earnings are also taken into account. Occasionally, property projects are sold with guarantees of a certain level of leasing, and, at the time of sale, any rental guarantees are reported as a reserve in the project, which then has a positive effect on successive profit recognition as letting takes place.
Income also includes rental income, which is to be considered as operating leasing. Rental income is announced in advance and accrued on a straight-line basis in the income statement based on the terms of the leases. Rent paid in advance reported as prepaid rental income. In cases where the rental contract allows a reduced rent for a certain period of time, which is compensated for by higher rent during another period, this is allocated across the term of the contract.
Other income refers to income not classified as construction income, property sales and building rights, or rental income such as hotel revenues, government subsidies, or income from central companies.
| Indicator | Definition | Purpose | ||||||
|---|---|---|---|---|---|---|---|---|
| Growth | Income for the period less income for the previous period | In the Company's view, the key indicator | ||||||
| divided by income for the previous period. | allows investors, who so wish, to assess the | |||||||
| Company's capacity to increase its earnings. | ||||||||
| Organic | Income for the period, adjusted for acquired growth, less | In the Company's view, the key indicator | ||||||
| growth | income for the previous period, adjusted for acquired | allows investors, who so wish, to assess the | ||||||
| growth, divided by income for the previous period, | Company's capacity to increase its income | |||||||
| adjusted for acquired growth. | without acquiring operating companies. | |||||||
| Jan– | ||||||||
| Apr–Jun | Apr–Jun | Jan–Jun | Jan–Jun | Jul–Jun | Dec | |||
| Calculation of organic growth | 2022 | 2021 | 2022 | 2021 | 2021/2022 | 2021 | ||
| Income current period | 2,658 | 2,274 | 4,710 | 4,224 | 9,221 | 8,735 | ||
| Income corresponding to previous period | 2,274 | 1,393 | 4,224 | 3,207 | 7,888 | 6,871 | ||
| Income change | 384 | 881 | 486 | 1,017 | 1,333 | 1,864 | ||
| Adjustment for structural effect | 0 | 0 | 0 | 0 | 0 | 0 | ||
| Total organic growth | 384 | 881 | 486 | 1,017 | 1,333 | 1,864 | ||
| Total organic growth (%) | 16.9% | 63.2% | 11.5% | 31.7% | 16.9% | 27.1% | ||
| Order | The value of new projects and changes in existing projects | In the Company's view, this key indicator | ||||||
| bookings | during the period. | allows investors, who so wish, to assess the | ||||||
| Company's sales in Business Area Contracting | ||||||||
| for the current period. | ||||||||
| Order | The value of the Company's undelivered orders at the end | In the Company's view, this key indicator | ||||||
| backlog | of the period excluding cooperation agreements. | allows investors, who so wish, to assess the Company's income in Business Area |
||||||
| Contracting over upcoming periods. | ||||||||
| Operating | Operating profit divided by income. | In the Company's view, the key indicator allows investors, who so wish, to assess the |
||||||
| margin | Company's profitability. | |||||||
| Operating | Current assets less current liabilities. | In the Company's view, the key indicator | ||||||
| capital | allows investors, who so wish, to assess the | |||||||
| Company's tied-up capital in relation to its | ||||||||
| competitors. | ||||||||
| Capital | Consolidated total assets less deferred tax assets less non | In the Company's view, this key indicator | ||||||
| employed | interest-bearing liabilities including deferred tax liabilities. | allows investors, who so wish, to assess the | ||||||
| total capital placed at the Company's | ||||||||
| disposal by shareholders and creditors. | ||||||||
| Jun 30 | Jun 30 | Dec 31 | ||||||
| Calculation of capital employed | 2022 | 2021 | 2021 | |||||
| Total assets | 6,873 | 6,297 | 6,914 | |||||
| Deferred tax assets | -132 | -89 | -108 | |||||
| Less non-interest-bearing liabilities including deferred tax liabilities | -2,934 | -2,498 | -2,845 | |||||
| Capital employed | 3,807 | 3,710 | 3,961 | |||||
| Indicator | Definition | Purpose | |||||
|---|---|---|---|---|---|---|---|
| Return on capital employed |
Profit after net financial items plus financial expenses divided by average capital employed for the period. Accumulated interim periods are based on rolling 12- month earnings. |
In the Company's view, the key indicator allows investors, who so wish, to assess the Company's capacity to generate a return on the total capital placed at the Company's disposal by shareholders and creditors. |
|||||
| Calculation of average capital employed | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
||||
| Jun 30, 2022 (3,807) + Jun 30, 2021 (3,710) / 2 | 3,759 | ||||||
| Jun 30, 2021 (3,710) + Jun 30, 2020 (3,573) / 2 | 3,642 | ||||||
| Dec 31, 2021 (3,961) + Dec 31, 2020 (3,539) / 2 | 3,750 | ||||||
| Calculation of return on capital employed | Jun 30 | Jun 30 | Dec 31 | ||||
| 2022 | 2021 | 2021 | |||||
| Profit after net financial items Plus financial expenses |
210 57 |
-52 93 |
256 38 |
||||
| Average capital employed | 3,759 | 3,642 | 3,750 | ||||
| Return on capital employed | 7.1% | 1.1% | 7.8% | ||||
| Equity per share, before/afte r dilution |
Total equity according to the balance sheet divided by the number of shares outstanding on the closing date. The difference between before and after dilution is accounted for by the convertibles issued by the Group. |
The Company believes that key indicators give investors a better understanding of historical return per share at the closing date. |
|||||
| Cash flow from operations per share, before/afte r dilution |
Cash flow from operating activities divided by the average number of shares during the period. The difference between before and after dilution is accounted for by the convertibles issued by the Group. |
It is the Company's view that the key indicator gives investors a better understanding of the operations' cash flow in relation to the number of shares, adjusted for changes in the number of shares during the period. |
|||||
| Earnings per share, before/afte r dilution |
Profit for the period divided by the average number of shares during the period. The difference between before and after dilution is accounted for by the convertibles issued by the Group. |
It is the Company's view that the key indicator gives investors a better understanding of profit per share. |
| Indicator | Definition | Purpose | ||||
|---|---|---|---|---|---|---|
| Return on equity | Profit for the period as apercentage of average shareholders' equity. Accumulated interim periods are based on rolling 12-month earnings. |
In the Company's view, the key indicator allows investors, who so wish, to assess the Company's capacity to generate a return on the capital shareholders have placed at the Company's disposal. |
||||
| Calculation of average shareholders' equity Jun 30, 2022 (2,602) + Jun 30, 2021 (2,340) / 2 |
Jun 30 2022 2,471 |
Jun 30 2021 |
Dec 31 2021 |
|||
| Jun 30, 2021 (2,340) + Jun 30, 2020 (1,959) / 2 Dec 31, 2021 (2,467) + Dec 31, 2020 (1,946) / 2 |
2,150 | 2,207 | ||||
| Profit/loss for the period | Calculation of return on shareholders' equity | |||||
| Average shareholders' equity | 252 2,471 |
86 2,150 |
349 2,207 |
|||
| Return on equity | 10.2% | 4.0% | 15.8% | |||
| Equity/assets ratio | Shareholders' equity less minority interests as apercentage of total assets. |
The equity/assets ratio shows the proportion of total assets represented by shareholders' equity and has been included to allow investors to be able to assess the Company's capital structure. |
||||
| Net debt | Interest-bearing liabilities less liquid assets less interest-bearing receivables. |
Net debt is a measure deemed relevant for creditors and credit rating agencies. |
||||
| Net debt/equity ratio | Interest-bearing net debt divided by shareholders' equity. |
Net debt/equity ratio is a measure deemed relevant for creditors and credit rating agencies. |
||||
| EBITDA | Operating profit excluding amortization/depreciation. |
EBITDA is a measure deemed to provide investors a better understanding of the Company's earnings. |
||||
| Calculation of EBITDA | Jun 30 2022 |
Jun 30 2021 |
Dec 31 2021 |
|||
| Operating profit | 193 | 14 | 235 | |||
| Depreciation | 80 | 80 | 80 | |||
| EBITDA | 273 | 94 | 315 | |||
| Net debt/EBITDA | Interest-bearing liabilities less liquid assets less interest-bearing receivables divided by EBITDA. |
Net debt/EBITDA is a measure deemed relevant for creditors and credit rating agencies. |
Serneke is a growing corporate group providing comprehensive services in contracting and projectdevelopment with more than 1,200 employees. Through novel thinking, we drive development and create more effective and more innovative solutions for responsible construction. The business has a good mix of
Serneke Group AB (publ) Headquarters: Kvarnbergsgatan 2 SE-411 05 Gothenburg Phone +46 (0)31-712 97 00 | [email protected] public and commercial assignments, providing strength over economic cycles.
Serneke's annual reports and other financial information are available under the tab Investors at www.serneke.se
On July 15, 2022, at 9:00 a.m. (CET), Serneke Group will comment on this Interim Report in a live online presentation for investors, analysts and the media. The presentation will be held in Swedish and can be followed live via webcast at https://tv.streamfabriken.com/serneke-q2-2022. Presentation materials for the presentation will be available on the website one hour before the webcast begins.
To participate, please dial: +46 8566 42 705
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