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Fasadgruppen Group

Earnings Release May 12, 2022

3047_10-q_2022-05-12_4b559bbc-2558-41de-9a2c-f14c555b5eb9.pdf

Earnings Release

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Interim report 1 January – 31 March 2022

"Positive start to the year – strong growth in order backlog"

First quarter highlights

  • Net sales increased to SEK 737.5 million (433.1), corresponding to growth of 70.3 percent. Organic growth was 4.3 percent.
  • EBITA increased to SEK 38.6 million (17.7) and the EBITA margin was 5.2 percent (4.1).
  • Items affecting comparability1 impacted EBITA by SEK - 4.8 million (-9.2). Adjusted EBITA (excluding items affecting comparability) increased to SEK 43.4 million (26.9).
  • Earnings for the period amounted to SEK 22.2 million (7.3), earnings per share before and after dilution were SEK 0.48 (0.16).
  • Operating cash flow rose to SEK 74.9 million (2.5).
  • The order backlog increased to SEK 2,616.0 million (1,409.6).

Significant events during the quarter

  • Nine new acquisitions have been completed in the quarter: Miljø-Sanering, Meyer-Mørch, Murpartnern and Malercompagniet Oslo in Norway, and Helsingborgs Fasad & Kakel, Herrängens Plåtslageri, Vantörs Bleck och Plåtslageri, E.P.M. Elektra Plåt och Maskin and Alnova Balkongsystem in Sweden.
  • Fasadgruppen has carried out a directed share issue of 3,000,000 shares, generating proceeds of SEK 420 million.

Events after the end of the period

• Five additional acquisitions have been completed: Kjær Knudsen in Denmark, Fjeldheim-Knudsen in Norway, as well as A Co Tak & Montage, GAJ Stålkonstruktioner and Mur o Puts i Kristianstad in Sweden.

Key figures2

2022 2021 2022 Q1 2021
SEK million Jan–Mar Jan–Mar Δ 12M Jan–Dec
Net sales 737.5 433.1 70.3% 2,980.7 2,676.3
EBITA 38.6 17.7 118.9% 304.7 283.7
EBITA margin, % 5.2 4.1 10.2 10.6
Adjusted EBITA 43.4 26.9 61.6% 317.5 301.0
Adjusted EBITA margin, % 5.9 6.2 10.7 11.2
Cash flow from operating activities 74.9 2.5 2920.7% 326.0 253.5
Cash conversion, % 135.5 9.2 89.8 75.7
Return on capital employed, % 11.4 9.0 11.4 12.4
Return on shareholders' equity, % 14.3 12.9 14.3 16.0
Net debt to equity ratio, % 39.3 50.6 39.3 69.8
Profit/loss before tax 29.1 9.1 220.5% 258.8 238.8
Order backlog 2,616.0 1,409.6 85.6% 2,616.0 1,930.0

1For items affecting comparability in the respective period, see note 7.

2IFRS measures are Net Sales and Profit/loss before tax. Other measures are Alternative performance measures, for definitions of Alternative performance measures, see page 19.

Fasadgruppen Group AB is the largest façade work company in the Nordics and the only complete provider of sustainable façades operating nationwide in Sweden. The enterprise is based on local entrepreneurial companies that maintain a clear focus on cooperation, commitment and know-how.

CEO comment

Positive start to the year

As always, the first quarter is clearly our low season, as much of our work cannot be carried out at cold temperatures. Given this background, we have had a positive start to the year in terms of the development of the business. We have also maintained a rapid pace in terms of acquisitions, with nine new businesses added to the Group during the quarter and a further five after the end of the quarter.

Sales in the first quarter amounted to SEK 737.5 million, an increase of 70.3 percent compared with the corresponding quarter in the previous year. Organic growth was 4.3 percent and growth through acquisitions was 66.0 percent. The order backlog increased by 85.6 percent in the quarter, of which organic growth accounted for a good 18.6 percent. The adjusted EBITA margin amounted to 5.9 percent in the quarter, compared with 6.2 percent in the corresponding quarter in the previous year.

Strong momentum in acquisitions

While projects experienced low levels of activity, the opposite was true of our acquisition work. Up to and including March, we had acquired nine new businesses with estimated annual sales of approximately SEK 447 million. In Norway, we strengthened our market offering in both Oslo and Stavanger. Of particular significance in Oslo is Malercompagniet, which is one of the largest façade companies on its local market. In Sweden, we have broadened our offering, through the purchase of Alnova Balkongsystem, which supplies glazing systems to satisfied customers all over the country.

A further five acquisitions were completed after the end of the quarter, with total estimated annual sales of approximately SEK 345 million. These include Kjær Knudsen, which will strengthen our operations in Denmark.

Increased material prices require particular focus on profitability

In March and April, several of our suppliers announced large price increases for materials as a result of strain on the supply chain linked to the war in Ukraine, combined with high inflation. Maintaining our project margins is a priority that both the Group management and the

"We are focusing on growth with quality and profitability."

subsidiary management teams have a strong focus on. Most of our projects are based on fixed-price contracts, but there is a possibility under certain circumstances to pass on abnormal and unpredictable cost increases to the customer. We have, however, purchased materials at the old prices as far as possible for contracts already entered into, so that we are able to deliver the projects to the agreed price. In relation to new projects, dialogues with customers generally indicate a good understanding of the need for increased prices. We continue to follow the development very closely, maintaining a close dialogue with both suppliers and customers in order to be able to act based on the current conditions.

Value-creating share issue

Finally, I would like to mention the share issue that took place in March. We are extremely proud of the confidence and great interest shown in Fasadgruppen despite the current turbulence on the stock market. Our intention with this share issue is to accelerate value creation by maintaining our active acquisition agenda, where we are focusing on growth with quality and profitability.

Despite some short-term challenges as a result of the turbulent global situation, I see good opportunities to continue to strengthen Fasadgruppen's market position. We are now looking forward to a period with high levels of project activity in everything from 'million programme' properties to castles and churches.

Pål Warolin, CEO and Group President

Group growth

First quarter

Net sales

Net sales for the first quarter of 2022 amounted to SEK 737.5 million (433.1), a 70.3 percent increase compared with the same period in the previous year. Exchange rate fluctuations had a positive effect on net sales of 1.9 percent compared with the comparison period. Organic growth amounted to 4.3 percent and growth through acquisitions to 66.0 percent. Organic growth remained positive during the quarter. This is considered to be due in part to the comparison period being the first quarter of 2021, which was still affected by the Covid-19 pandemic. In the first quarter of 2022, Fasadgruppen has implemented nine acquisitions of which three were asset acquisitions and they have all joined us during the quarter. For more information on acquisitions in the first quarter of 2022, please see page 6 and note 8 on pages 16–17.

Earnings

EBITA for the current quarter rose to SEK 38.6 million (17.7) and adjusted EBITA to SEK 43.4 million (26.9). Items affecting comparability in the quarter as a whole amounted to SEK - 4.8 million (-9.2); see also note 7. The adjusted EBITA margin for the current quarter amounted to 5.9 percent (6.2). The first quarter of the year is usually characterised by a considerably weaker margin than the remaining nine-month period, as the winter conditions can make roof work and other outdoor services, for example, more difficult; see also page 7 Seasonal variations. The effect of increased raw material prices in the economy at large has continued to have a limited impact on profitability in the first quarter. The war in Ukraine is currently considered to have limited impact on Fasadgruppen's business in the short term. he Group operates only in Sweden, Norway and Denmark and has only a very limited number of personnel and quantities of input goods that come from the warring countries. Net financial items for the quarter amounted to SEK -3.5 million (-3.2). Interest expenses on loans from credit institutions amounted to SEK -1.8 million (-2.1). Profit for the period amounted to SEK 22.2 million (7.3), corresponding to earnings per share of SEK 0.48 (0.16) before dilution. The effective tax rate was 23.7 percent (19.6).

Order backlog

At the end of March 2022, the order backlog amounted to SEK 2,616 million (1,410), an increase of 85.6 percent. The order backlog for comparable companies at the end of March 2021 had increased by 18.6 percent, while the acquisition growth in the order backlog amounted to 67.0 percent. Organic growth in the order backlog remained strong during the first quarter of 2022 and the order growth for comparable companies during the period was very positive. Since year-end, the order backlog has increased by SEK 686 million; companies acquired and added in the period January–March 2022 had added SEK 331 million to the order backlog at the end of the period.

Financial position and financing

t the end of the period, shareholders' equity was SEK 1,737.9 million (1,269.6). The change in shareholders' equity between the period ends can primarily be attributed to the targeted new share issue that was carried out in March and which generated proceeds of SEK 409.5 million after issue costs. Offset share issues on acquisitions added a further SEK 10.0 million and the remaining change in shareholders' equity can be attributed to profit for the period. Interest-bearing net debt on 31 March 2022 amounted to SEK 683.7 million (542.2). The interestbearing net debt includes lease liabilities amounting to SEK 160.0 million (87.6). Earnouts are not included in interest-bearing net debt and on 31 March 2022 amounted to SEK 309.1 million (140.3). The fixed interest period for interest-bearing liabilities varies between 1 and 3 months. Expanded financing in the period January to March 2022 has primarily been utilised in association with acquisitions completed. he ratio of Fasadgruppen's interest-bearing net debt to adjusted EBITDA 12M (not on a proforma basis) was 1.8 (3.0) at the end of the period. On 31 March 2022, the Group held cash and cash equivalents and other shortterm investments amounting to SEK 685.0 million (222.1). In addition to cash and cash equivalents and other shortterm investments, there were unutilised credit facilities of SEK 30.0 million at the end of the period. The change in working capital remained positive for the quarter and amounted to SEK 33.7 million (-20.0). The strong growth in working capital for the current quarter in contrast to the comparison period is considered to be mainly due to delays to the positive flows of working capital that are normally seen when the majority of projects are completed at the end of the year.

Investments and cash flow

Cash flow from operating activities amounted to SEK 74.9 million (2.5) for the period January to March 2022. Group net investments in tangible non-current assets amounted to SEK -14.1 million (-4.5) for the same period. Depreciation on non-current assets for the period amounted to SEK -22.7 million (-14.8), of which depreciation on acquired intangible assets, such as customer relationships, amounted to SEK -6.1 million (-5.4). Investments in company acquisitions for the period January–March 2022 amounted to SEK -199.8 million

(-186.6). This amount mainly concerns businesses acquired during the period. Other than this, the amount consists of contingent considerations settled in relation to acquisitions from previous years in the amount of SEK -2.7 million.

Personnel

The Group had 1,619 employees (1,004) on 31 March 2022, of whom 76 were women (37). The average number of employees for the period January–March 2022 was 1,460 (930). The significant change from the comparison period is primarily attributable to new acquisitions. For more information on acquisitions in the period January-March 2022, please see page 6.

Parent Company

Fasadgruppen Group AB acts as a holding company for the Group and provides head office functions such as Groupwide management, administration and a finance department. Income comprises management fees from Group companies for Group-wide services and costs covered by the Parent Company. Profit for the period January–March 2022 amounted to SEK -2.5 million (-7.3). Assets primarily consist of participations in, and receivables from, Group company Fasadgruppen Norden AB and amounted to SEK 2,620.3 million (1,574.4) at the end of the period. hareholders' equity amounted to SEK 1,415.5 million (904.3) on the balance sheet date. At the end of the period, the Parent Company had 3 employees (3).

Market overview

Fasadgruppen is the leading complete provider of sustainable façades with a local presence in Sweden, orway and Denmark. he Group's main customers are property owners, construction companies, property management companies, consultants, tenant-owner housing associations, government, municipalities and county council authorities.

According to a market survey carried out in connection with the company's IPO at the end of 2020, sales on the Scandinavian façade market are estimated at around SEK 97 billion. The Swedish market amounts to around 37 billion, the Norwegian market 31 billion and the Danish market approx. 29 billion. Big city regions account for around half of sales.

Fasadgruppen's markets are characterised by long-term stability, driven by an underlying need to renovate both residential and commercial properties. In connection with new construction, façade work also represents a crucial and specialised activity that construction companies outsource to a large extent. In addition to the underlying need for façade work, the trend towards more energy-efficient façade solutions is also considered to be capable of driving further market growth.

Fasadgruppen is active in the mid-size segment of the market where projects are in the magnitude of SEK 1– 100 million. Based on this, the Group has created a diversified structure with many smaller, flexible companies in a large number of geographic areas. Local subsidiary company CEOs can take quick business decisions independently and adapt to customer requirements. The means the Group has a stable platform from which to enjoy sustainable profitable growth moving forward.

Sales by geographic area 2022 12M

Acquisitions

In the first quarter of 2022, Fasadgruppen acquired nine new businesses, of which six were company acquisitions and three were asset acquisitions. After the end of the reporting period, a further four businesses have been acquired. These acquisitions are a key part of the Group's growth strategy and are carefully chosen based on selective criteria that are defined in the Fasadgruppen growth strategy.

In 2022, the Group has acquired an estimated SEK 739 million in annual sales and added around 325 new employees to the workforce, that bring new know-how and working capacity to the Group.

Goodwill totalling SEK 2,126.3 million within the Group is a result of continuous and consciously targeted acquisitions over a number of years. Accumulated goodwill primarily

relates to growth expectations, expected future profitability, the significant knowledge and expertise possessed by subsidiary company personnel and expected synergies on the costs side.

Nine new acquisitions were added during the first quarter of 2022: Miljø-Sanering, Meyer-Mørch, Murpartnern, Malercompagniet Oslo, Helsingborgs Fasad & Kakel, Herrängens Plåtslageri, Vantörs Bleck och Plåtslageri, E.P.M. Elektra Plåt och Maskin and Alnova Balkongsystem. All acquisitions have been completed in accordance with the Fasadgruppen strategy and all companies complement and strengthen the Group's competitiveness.

For more information on acquisitions in the period January–March 2022, please see note 8 on pages 16–17.

Acquisitions of companies

Fasadgruppen has added the following acquisitions in 2022.

Estimated annual
sales at time of
acquisition, No. of
Access Acquisitions Country SEK million employees
May Murmestrene Fjeldheim-Knudsen AS Norway 53 36
April Mur o Puts i Kristianstad AB Sweden 25 15
April GAJ Stålkonstruktioner AB Sweden 57 35
April Kjær Knudsen A/S Denmark 190 56
April A Co Tak & Montage AB Sweden 20 7
February Malercompagniet Oslo AS Norway 136 56
February Murpartnern AS Norway 50 50
February Meyer-Mørch AS Norway 29 9
February Alnova Balkongsystem AB Sweden 165 64
Herrängens Plåtslageri AB, Vantörs Bleck och
February Plåtslageri AB, E.P.M. Elektra Plåt och Maskin AB Sweden 30 13
(asset acquisition)
February Helsingborgs Fasad & Kakel AB Sweden 30 14
February Miljø-Sanering AS Norway 7 6
792 361

The Fasadgruppen M&A strategy

Fasadgruppen has an active acquisition strategy. Acquisitions are primarily implemented with the aim of broadening the Group geographically and strengthening its offering. As well as adding new companies to the Group, add-on acquisitions are also made to existing companies with the aim of adding expertise, framework agreements and critical mass.

Fasadgruppen has established a number of acquisition criteria with requirements such as good profitability, geographic locations and long-term management. In Sweden, over 500 potential acquisition candidates have been identified. The corresponding figure for the other Nordic countries is over 1,800 potential companies.

Other information

Risks and uncertainties

Fasadgruppen's business is affected by a number of risks whose effects on earnings and our financial position can be managed to varying degrees. When assessing the Group's future development, it is important to consider the risk factors in addition to possible opportunities for earnings growth. The Group is exposed to different types of risk in its business and these are categorised as operational risks, financial risks and external risks. External risks are primarily related to factors outside Fasadgruppen's own businesses, such as macroeconomic growth on the Group's main markets. Operational risks are related to day-to-day operations such as tendering, capacity utilisation, percentage of completion and price risks. The financial risks include liquidity and loan financing risks. Risk management is clearly defined in the Fasadgruppen management system, which is designed to prevent and reduce the Group's risk exposure. Risk management in the Group aims to identify, measure, control and limit risks in the business.

Strong demand for raw materials combined with production and delivery issues has caused a shortage of materials in several industries but has had only a limited impact on Fasadgruppen's operations during the first quarter of 2022. The Group has been working ceaselessly with suppliers to secure the supply of materials and also manage the price increases generated by supply and demand. The longer-term consequences, which are mostly considered to be of a general cyclical nature, are currently hard to predict. The tragic situation we are witnessing in the war between Ukraine and Russia is currently considered to have limited impact in the short term. The Group operates only in Sweden, Norway and Denmark and has only a very limited number of personnel and quantities of input goods that come from the warring countries. The Group continues to monitor developments closely as part of its ongoing risk management work, making adjustments when necessary.

No additional risks and uncertainties, beyond those presented, are deemed to have arisen during the period. For further information on the Group's risks, please see the 2021 Annual Report.

Seasonal variations

Fasadgruppen's activities and markets are affected by seasonal variations to a certain degree. As a rule, the first quarter of the year is weaker than the remaining ninemonth period as the winter conditions can make roof work and other outdoor services, for example, more difficult. Low temperatures mean it is more difficult for rendering and masonry work to be cured to the expected compressive strength and therefore larger projects involving rendering and masonry are avoided during winter months. he Group's diversified structure, with regard to both market offering and geographic presence, limits exposure to seasonal variations to a certain extent, however.

Future projections

The Nordic market is expected to continue to have stable underlying renovation requirements in the future. Underlying driving forces, such as urbanisation, housing shortages, the tough Nordic weather climate and energy consumption regulation, are considered to lead to a continuing willingness to invest among the Group's customer groups, which points to continued long-term growth potential for Fasadgruppen. The Group has a well underpinned acquisition strategy and future acquisition opportunities are considered to remain good. Business operations in the rest of the Nordic region are under development and talks about acquisitions are being held with a number of companies outside Sweden. The Group's financial base creates the stability that aids both investments and acquisitions. Fasadgruppen continues to develop its sustainability work with the focus on profitability and those products that are being developed for the sustainable façade solutions of the future that should boost the competitiveness of customers. The Group is firmly resolved to drive both daily improvement work in its business and the transformation of the façade sector towards safe and more sustainable solutions.

You can also read about how the Group is working to counter possible risks as a consequence of the shortage of materials in several industries and the ongoing war between Ukraine and Russia in the section on Risks and uncertainties.

Incentive programme

The 2021 Annual General Meeting resolved to introduce a long-term incentive programme for employees in the Group consisting of a maximum 923,010 warrants. Each warrant entitles the holder to subscribe to a new share in the company in June 2024. The subscription price for each such share shall be SEK 164.1, which corresponds to 125 percent of the averaged volume-weighted price paid for the company's shares on the asdaq tockholm over the last ten trading days before the 2021 AGM.

At this moment in time, 487,382 warrants have been issued to 64 employees in the Group at a market price calculated in accordance with the Black & Scholes model. Option premiums paid amount to SEK 7.9 million. The remaining , warrants are held by the company's wholly owned subsidiary, Fasadgruppen Norden AB, and have been transferred free of charge.

Under certain circumstances, the company has the right to buy back warrants from holders who cease to be employees of the Group or that wish to transfer their warrants to a third party. For more information on the warrant terms and conditions, please see the company website.

Shares and share capital

There has been an increase in the number of shares and voting rights in the first quarter of 2022 as a result of a targeted new share issue of a total of 3,000,000 shares and an offset share issue of a total of 62,790 shares as part of the purchase consideration on the acquisition of Alnova Balkongsystem AB. As at 31 March 2022, the number of shares and votes amounted to 45,450,443 with a share capital of SEK 2.4 million, corresponding to a quotient value of SEK 0.05 per share. The three largest shareholders in the company at the end of December 2021 were Capital Group, Connecting Capital, and Swedbank Robur Fonder.

Proposed dividend

The Board of Directors proposes to the Annual General Meeting that a dividend of SEK 1.20 (0.60) per share be paid for the year, which is in line with Fasadgruppen's dividend policy to distribute 30 percent of the Group's consolidated net profit, taking into account factors such as financial position, cash flow and growth opportunities. The total dividend thus amounts to SEK 58.1 (27.1). The proposed dividend corresponds to 31.3 percent of the Group's net profit.

Events after the end of the period

• Five additional acquisitions have been completed: Kjær Knudsen in Denmark, Fjeldheim-Knudsen in Norway as well as A Co Tak & Montage, GAJ Stålkonstruktioner and Mur o Puts i Kristianstad in Sweden.

Presentation of interim report

The interim report will be presented in a telephone conference and webcast on 12 May at 8.15 a.m. CEST via https://tv.streamfabriken.com/fasadgruppen-group-q1- 2022. Phone number for participation: +46 8 5055 8350 / +44 333 300 9266.

Financial reports

Condensed consolidated income statement and statement of comprehensive income

2022 2021 2022 Q1 2021
SEK million Jan–Mar Jan–Mar 12M Jan–Dec
Net sales 737.5 433.1 2,980.7 2,676.3
Other operating income 6.7 4.3 53.1 50.7
Operating income 744.2 437.4 3,033.8 2,726.9
Materials and consumables -367.6 -215.8 -1,513.4 -1,361.7
Remuneration to employees -265.0 -155.0 -937.1 -827.2
Depreciation and impairments of tangible
and intangible non-current assets -22.7 -14.8 -82.5 -74.5
Other operating costs -56.4 -39.5 -220.3 -203.4
Total operating costs -711.6 -425.1 -2,753.2 -2,466.7
Operating profit/loss 32.6 12.2 280.6 260.2
Net financial items -3.5 -3.2 -21.8 -21.5
Profit/loss after financial items 29.1 9.1 258.8 238.8
Tax on profit for the period -6.9 -1.8 -58.2 -53.0
Profit/loss for the period 22.2 7.3 200.6 185.7
Other comprehensive income for the
period:
Items that will not be reclassified to profit
or loss: - - - -
Items that can be reclassified to profit or
loss:
Exchange rate differences on translation of
foreign operations 26.6 17.4 31.0 21.8
Other comprehensive income for the
period, net after tax 26.6 17.4 31.0 21.8
Comprehensive income for the period 48.8 24.7 231.6 207.5
Comprehensive income for the period - - - -
attributable to:
Shareholders in the Parent Company 48.8 24.7 231.6 207.5
Holdings without controlling interest
Earnings per share for the period before dilution,
- - - -
SEK 0.48 0.16 4.41 4.11
Earnings per share for the period after dilution,
SEK
0.48 0.16 4.41 4.11
Average no of shares, before dilution* 46,169,048 45,132,480 45,502,972 45,243,830
Average no of shares, after dilution* 46,169,048 45,132,480 45,502,972 45,243,830
Actual no of shares at the end of the period 48,450,443 45,132,480 48,450,443 45,387,653

*Recalculated in respect of the share split in 2020.

Condensed consolidated balance sheet

SEK million 31/03/2022 31/03/2021 31/12/2021
ASSETS
Brand 316.0 159.5 264.5
Customer relationships 16.5 15.0 13.6
Goodwill 2,126.3 1,449.2 1,953.6
Other intangible assets 1.0 0.5 0.5
Total intangible assets 2,459.8 1,624.2 2,232.3
Right-of-use assets 150.7 90.2 133.3
Tangible non-current assets 107.1 55.5 81.3
Total tangible non-current assets 257.8 145.7 214.7
Financial non-current assets 6.0 2.9 3.7
Total non-current assets 2,723.6 1,772.8 2,450.6
Inventories 19.9 7.0 16.0
Accounts receivable 451.3 281.1 410.8
Revenues from contracts with customers and similar receivables 174.0 101.7 128.0
Prepaid expenses and accrued income 21.5 11.5 27.2
Other receivables 51.7 5.4 41.3
Cash and cash equivalents 685.0 222.1 271.6
Total current assets 1,403.3 628.8 894.9
TOTAL ASSETS 4,126.9 2,401.6 3,345.5
SH R H LD RS' QU Y
D L
L
S
Sh
h
' q i y
1,737.9 1,071.2 1,269.6
Non-current interest-bearing liabilities 1,121.9 573.8 911.7
Non-current lease liabilities 115.0 64.3 96.5
Deferred tax liabilities 89.7 43.0 74.5
Other non-current liabilities 185.5 117.7 158.0
Total non-current liabilities 1,512.2 798.8 1,240.8
Current interest-bearing liabilities 86.8 102.8 114.6
Current lease liabilities 45.0 23.3 34.7
Accounts payable 246.1 128.1 180.4
Contract and similar liabilities 320.6 142.9 302.5
Accrued expenses and prepaid income 178.3 123.2 162.0
Other current liabilities - 11.2 41.0
Total current liabilities 876.8 531.5 835.1
L SH R H LD RS' QU Y
D L
L
S
4,126.9 2,401.6 3,345.5

Condensed statement of changes in shareholders' equity

Retained
earnings
Other including Total
contributed profit/loss for h
h
'
SEK million Share capital capital the period Reserves equity
Sh
h
' q i y
01/01/2021 2.3 844.7 205.8 -6.2 1,046.5
Profit/loss for the period - - 7.3 - 7.3
Other comprehensive income:
Exchange rate differences on
translation of foreign operations - - - 17.4 17.4
Total comprehensive income - - 7.3 17.4 24.7
Sh
h
' q i y
31/03/2021 2.3 844.7 213.1 11.2 1,071.2
Sh
h
' q i y
01/01/2021 2.3 844.7 205.8 -6.2 1,046.5
Profit/loss for the period - - 185.7 - 185.7
Other comprehensive income:
Exchange rate differences on
translation of foreign operations - - - 21.8 21.8
Total comprehensive income - - 185.7 21.8 207.5
Dividend - - -27.1 - -27.1
Option liquidity - 7.9 - - 7.9
Offset share issue 0.0 34.7 - - 34.7
Transactions with shareholders 0.0 42.6 -27.1 - 15.6
Sh
h
' q i y
31/12/2021 2.3 887.3 364.5 15.6 1,269.6
Sh
h
' q i y
01/01/2022 2.3 887.3 364.5 15.6 1,269.6
Profit/loss for the period - - 22.2 - 22.2
Other comprehensive income:
Exchange rate differences on
translation of foreign operations - - - 26.6 26.6
Total comprehensive income - - 22.2 26.6 48.8
Targeted new share issue 0.2 409.4 - - 409.5
Offset share issue 0.0 10.0 - - 10.0
Transactions with shareholders 0.2 419.4 - - 419.5
Sh
h
' q i y
31/03/2022 2.4 1,306.7 386.6 42.2 1,737.9

Condensed consolidated statement of cash flows

2022 2021 2022 Q1 2021
SEK million Jan–Mar Jan–Mar 12M Jan–Dec
Operating activities
Profit/loss after financial items 29.1 9.1 258.8 238.8
Adjustment for non-cash items 22.9 13.1 91.3 81.4
Interest paid -5.5 -2.8 -11.5 -8.8
Tax paid -36.8 -23.4 -89.2 -75.7
Changes in working capital 33.7 -20.0 19.8 -34.0
Cash flow from operating activities 43.4 -24.0 269.1 201.7
Investing activities
Acquisition of subsidiaries and businesses -199.8 -186.6 -635.2 -622.0
Net investments in non-current assets -14.1 -4.5 -56.8 -47.2
Net investments in financial assets 0.7 -0.3 1.2 0.2
Cash flow from investing activities -213.1 -191.4 -690.8 -669.1
Financing activities
New share issue 409.5 - 409.5 -
Payment of warrants - - 7.9 7.9
Dividend paid - - -27.1 -27.1
Proceeds from borrowings 180.6 105.0 1,445.6 1,370.0
Repayment of loans - -73.3 -915.4 -988.7
Repayment of lease liability -10.6 -6.5 -40.6 -36.5
Cash flow from financing activities 579.5 25.1 879.9 325.6
Cash flow for the period 409.7 -190.3 458.3 -141.7
Cash and cash equivalents at start of period 271.6 409.3 222.1 409.3
Translation difference in cash and cash
equivalents
3.7 3.0 4.7 3.9
Cash and cash equivalents at end of period 685.0 222.1 685.0 271.6

Condensed Parent Company income statement

2022 2021 2022 Q1 2021
SEK million Jan–Mar Jan–Mar 12M Jan–Dec
Operating income 2.7 2.2 10.2 9.7
Operating expenses -4.4 -9.2 -18.1 -22.8
Operating profit/loss -1.7 -7.0 -7.9 -13.2
Net financial items -1.4 -2.2 29.6 28.8
Profit/loss after net financial items -3.1 -9.2 21.8 15.7
Appropriations - - 59.3 59.3
Profit/loss before tax -3.1 -9.2 81.1 75.0
Tax on profit for the period 0.6 1.9 -5.0 -3.7
Profit/loss for the period* -2.5 -7.3 76.1 71.3

*There are no items recognised in other comprehensive income at the Parent Company and therefore the total comprehensive income is the same as the profit/loss for the period.

Condensed Parent Company balance sheet

SEK million 31/03/2022 31/03/2021 31/12/2021
ASSETS
Tangible non-current assets 0.2 - 0.2
Financial non-current assets 2,371.9 1,240.5 1,389.2
Total non-current assets 2,372.2 1,240.5 1,389.5
Current receivables 1.2 0.5 1.1
Cash and bank 247.0 333.4 646.1
Total current assets 248.1 333.9 647.3
TOTAL ASSETS 2,620.3 1,574.4 2,036.8
SH R H LD RS' QU Y
D L
L
S
Restricted shareholders' equity 2.4 2.3 2.3
Unrestricted shareholders' equity 1,413.0 902.0 996.2
h
h
' q i y
1,415.5 904.3 998.5
Non-current liabilities 1,119.7 573.7 908.7
Accounts payable 1.4 0.1 1.3
Other current liabilities 79.8 93.8 119.7
Accrued expenses and prepaid income 4.0 2.6 8.6
Total liabilities 1,204.9 670.1 1,038.3
L SH R H LD RS' QU Y
D L
L
S
2,620.3 1,574.4 2,036.8

Notes

Note 1 Accounting policies

Fasadgruppen Group AB applies the International Financial Reporting Standards (IFRS) as adopted by the European Union. The consolidated accounts in this interim report have been prepared in accordance with IAS 34 Interim Financial Reporting plus applicable regulations in the Swedish Annual Accounts Act. The Parent Company accounts have been prepared in accordance with the Swedish Annual Accounts Act and RFR 2, Accounting for Legal Entities. The interim report should be read together with the annual report for the financial year ending on 31 December 2021. The accounting policies and calculation bases are the same as those that were applied in the annual report for 2021. Information in accordance with IAS 34 16A also appears in other parts of the interim report in addition to the financial statements and associated notes.

The amounts are rounded to the nearest million (SEK million) to one decimal place, unless otherwise stated. As a consequence of rounding, figures presented in the financial reports may not add up to the exact total in certain cases and percentage figures can differ from the exact percentage figures. Amounts in brackets refer to the comparison period.

Note 2 Significant estimates and

assessments

Preparation of the interim report requires the company management to make assessments and estimates as well as assumptions that affect the application of the accounting policies and the carrying amounts of assets, liabilities, income and expenses. The actual outcome may deviate from these estimates and assessments. The critical assessments and estimates made when preparing this interim report are the same as in the most recent annual report.

Note 3 Allocation of income

Group, SEK million 2022
Jan–Mar
2021
Jan–Mar
2022 Q1
12M
2021
Jan–Dec
Sweden 470.5 337.3 2,056.7 1,923.4
Denmark 94.2 15.4 397.3 318.6
Norway 172.8 80.4 526.7 434.3
Total 737.5 433.1 2,980.7 2,676.3

Sales come from external customers, with no individual customer accounting for 10 percent or more of sales. The Group management identifies business operations as an operating segment, which is the division used by Fasadgruppen in its internal reporting. The operating segment is monitored by the Group's executive decisionmakers and strategic decisions are made on the basis of the operating profit for the segment.

Note 4 Related party transactions

The nature and scale of related party transactions are described in the Group Annual Report for 2021.

Transactions with related parties arise in current operations and are based on business terms and conditions and market prices. In addition to ordinary transactions between Group companies and remuneration to executives and directors, the following transactions with related parties have occurred during the period: During the Income outside Sweden comprises 36.2 percent (22.1) of total income for the Group for the period January to March 2022. The Group applies the percentage of completion method.

period 1 January to 31 March 2022, Fasadgruppen has bought and sold services from/to companies controlled by senior executives for amounts totalling SEK 0.9 million for purchased services and SEK 0.0 million for services sold linked to project-related work. As at 31 March 2022, Fasadgruppen's current liabilities to companies controlled by senior executives amounted to SEK 0.4 million and current receivables to SEK 0.0 million for project-related work.

Note 5 Pledged assets and contingent liabilities

Group, SEK million 31/03/2022 31/03/2021 31/12/2021
Pledged assets:
Company mortgages 20.3 84.8 38.9
Other 70.1 35.6 57.1
Total 90.4 120.4 96.0
Contingent liabilities:
Guarantees 223.8 166.7 169.7

Note 6 Fair value of financial instruments

The Group has financial instruments where level 3 has been used to determine the fair value. Financial liabilities measured at fair value through profit or loss pertain to earnouts not yet settled and amounted to SEK 285.6 million as at 01/01/2022. For the period January–March 2022, earnouts of SEK 2.7 million were settled. Additional new earnouts amounted to SEK 26.2 million from the company acquisitions of Malercompagniet Oslo AS, Alnova Balkongsystem AB, Helsingborgs Fasad & Kakel AB and the asset acquisitions of Herrängens Plåtslageri AB, Vantörs Bleck och Plåtslageri AB, E.P.M. Elektra Plåt och Maskin AB. At the end of the period, earnouts not yet settled amounted to SEK 309.1 million. The earnout amounts were mostly based on either EBITDA, EBIT or post-tax profits for the years 2021, 2022, 2023 and/or 2024. The earnouts are valued on an ongoing basis using a probability assessment, where an evaluation is

made of whether they will be paid at the agreed amounts. Management has here considered the risk for the outcome of future cash flows, where the time factor, given the prevailing interest rate situation, has not been considered material.

The fair value of Group financial assets and liabilities is estimated as equal to their book value. The Group does not apply netting for any of its significant assets or liabilities. No transfers between levels or valuation categories occurred in the period.

Changes in contingent earnouts, SEK million
Opening contingent earnouts, 01/01/2022 285.6
Contingent earnouts added 26.2
Earnouts settled -2.7
Closing contingent earnouts 31/03/2022 309.1
Expected disbursements
Expected disbursements in < 12 months -130.5
Expected disbursements in > 12 months -178.6

Note 7 Items affecting comparability

The table below presents items affecting comparability during the quarter and period.

Group, SEK million 2022
Jan–Mar
2021
Jan–Mar
2022 Q1
12M
2021
Jan–Dec
Costs related to IPO - -4.9 -0.2 -5.1
Acquisition-related costs -4.8 -4.3 -18.7 -18.2
Revaluation of earnouts - - 6.0 6.0
Other - - - -
Total -4.8 -9.2 -12.9 -17.3

Note 8 Business acquisitions

Company acquisitions January–March 2022

During the period, Fasadgruppen has completed the acquisitions of and added all shares in Malercompagniet Oslo AS, Murpartnern AS, Meyer-Mørch AS, Alnova Balkongsystem AB, Helsingborgs Fasad & Kakel AB and Miljø-Sanering AS.

he acquisitions were made to strengthen the Group's position geographically within rendering, masonry, window and roof work. Malercompagniet is one of the largest façade companies in the Oslo region and works mainly on renovation projects with a focus on painting, masonry, rendering and roofs. Murpartnern has built up a strong position in the Oslo region within façade renovation, with expertise in masonry, rendering and brickwork. Norska Meyer-Mørch focuses on painting and façade projects. The acquisition of balcony specialist lnova alkongsystem , one of weden's leading turnkey suppliers, strengthens the Group's offering within balcony solutions. Helsingborgs Fasad operates a façade business within masonry and rendering, tiling and balconies. The acquisition of sanitisation specialist Miljø anering strengthens the Group's presence in western Norway.

The acquired companies reported total earnings of around SEK 426 million and EBITA amounted to around SEK 41 million for the 2021 calendar year. Since the time of the acquisition and up to 31 March 2022, the companies have contributed SEK 46.4 million to Group net sales and SEK 5.4 million to Group EBITA.

The combined purchase consideration amounted to SEK 270.1 million, of which SEK 236.8 million has been paid

via cash and cash equivalents on gaining possession with SEK 23.2 million constituting earnouts and SEK 10.0 million via an offset share issue. The outcome of the earnouts that are dependent on future operating profits achieved by the companies concerned has been valued via a probability assessment where it is assessed that the agreed amount will be paid within the term of the earnout period, which is 1–4 years.

Acquisition costs totalling SEK 4.8 million are recognised as other operating expenses for January–March 2022.

Other business acquisitions January–March 2022

Asset acquisitions

Three asset acquisitions were completed in 2022, where operating subsidiaries within the Group complemented their business operations. The subsidiary Karlaplans Plåtslageri AB has acquired the operations of Herrängens Plåtslageri AB, Vantörs Bleck och Plåtslageri AB, E.P.M. Elektra Plåt och Maskin AB. The acquired businesses have annual sales of around SEK 30 million and 13 employees. SEK 9.0 million has been paid in cash and cash equivalents, with SEK 3.0 million constituting earnouts. As a consequence of their size, the asset acquisitions are not considered significant in relation to the Group's financial position and earnings.

Earnouts settled

During the period, earnouts have been settled in a total of SEK 2.7 million attributable to the acquisition of Hans Eklund Glasmästeri AB.

Acquisition analyses

Some of the surplus value in the preliminary acquisition analyses has been allocated to the company brand and customer relationships while unallocated surplus value has been attributed to goodwill.

The brands consist of the acquired company brands that are retained and utilised indefinitely, which is a key part of the Fasadgruppen strategy. Goodwill is primarily attributable to the expected future profitability of the business, the significant knowledge and expertise possessed by the personnel and synergies on the cost side. Customer relationships derive from the written agreements comprising the order backlog at the time of acquisition. Most of the agreements have a term shorter than 12 months and all are deemed to have been terminated within a maximum of 24 months.

Goodwill and brands have an indeterminable useful life and are not amortised but are tested for impairment annually or if such is indicated. The estimated value of customer relationships is amortised over the term of the order backlog.

Value according to acquisition analysis – Company acquisitions January–March 2022
-- -- -- -- -----------------------------------------------------------------------------------
Fair value
SEK million Carrying amount adjustment Fair value
Brand - 47.1 47.1
Customer relationships - 8.5 8.5
Right-of-use assets - 29.8 29.8
Tangible non-current assets 13.7 - 13.7
Financial non-current assets 0.3 - 0.3
Inventories 33.1 - 33.1
Accounts receivable and other receivables 51.9 - 51.9
Cash and cash equivalents 48.7 - 48.7
Deferred tax liabilities -3.0 -11.8 -14.8
Lease liabilities - -29.8 -29.8
Amounts owed to credit institutions -1.9 - -1.9
Appropriations -1.3 - -1.3
Other liabilities -1.3 - -1.3
Accounts payable and other liabilities -59.2 - -59.2
Identifiable net assets 81.0 43.8 124.8
Goodwill 145.3
Consideration 270.1
Of which earnout 23.2
Of which offset share issue 10.0
Of which cash and cash equivalents
transferred -236.8
Acquired cash and cash equivalents 48.7
Change in Group cash and cash
equivalents -188.1

Signatures

The Board of Directors and the Chief Executive Officer hereby confirm that the interim report gives a true and fair view of the company's and the Group's operations, financial position and performance, and describes significant risks and uncertainties faced by the company and the companies in the Group.

Stockholm, 11 May 2022

Fasadgruppen Group AB

Per Sjöstrand Chair of the Board

Ulrika Dellby Board Member Tomas Georgiadis Board Member

Christina Lindbäck Board Member

Tomas Ståhl Board Member Gunilla Öhman Board Member

Pål Warolin Group President and CEO

his interim report has not been reviewed by the company's auditors.

The information in this report is such that Fasadgruppen Group AB (publ) is obliged to publish under the EU Market Abuse Regulation. The information was submitted, under the auspices of the CEO, for publication on 12 May 2022 at 7.30 a.m. CEST.

Definitions of alternative performance measures

Fasadgruppen reports performance figures to describe the underlying profitability of the business and to improve comparability. The Group applies the ESMA guidelines on alternative performance measures. A list of alternative performance measures is available at www.fasadgruppen.se

Growth in net sales

Change in net sales as a percentage of net sales during the comparison period, previous year.

The change in net sales reflects the sales growth achieved by the Group over time.

Organic growth

Change in net sales as a percentage of net sales during the comparison period, previous year, for the companies that were part of the Group throughout the comparison period and the current period unadjusted for any currency effects.

Organic growth reflects the Group's realised sales growth, excluding acquisitions, over the measurement period.

EBITA

Earnings before interest and taxes (EBIT) before amortisation and impairment of goodwill, brands and customer relationships.

EBITA provides a picture of earnings generated from operating activities.

EBITDA

Earnings before interest and taxes (EBIT) before depreciation, amortisation, write-downs and impairment of tangible and intangible non-current assets.

EBITDA provides a picture of a company's current operating profit before depreciation and amortisation.

EBIT margin

Earnings (EBIT) as a percentage of net sales.

The EBIT margin is used to measure operating profitability.

EBITA margin

EBITA as a percentage of net sales.

The EBITA margin is used to measure operating profitability.

Items affecting comparability

Items affecting comparability are property sales, acquisition-related costs, preparatory costs of floatation and floatation costs, issue costs, restructuring costs and revaluations of earnouts.

Excluding items affecting comparability makes it easier to compare earnings between periods.

Adjusted EBIT

EBIT adjusted for items affecting comparability. Adjusted EBIT improves comparability between periods.

Adjusted EBITA

EBITA adjusted for items affecting comparability. Adjusted EBITA improves comparability between periods.

Adjusted EBITA margin

Adjusted EBITA as a percentage of net sales.

The adjusted EBITA margin is used to measure operating profitability.

Adjusted EBITDA

EBITDA adjusted for items affecting comparability.

Adjusted EBITDA improves comparability between periods.

Cash flow from operating activities

EBITDA less net investments in tangible and intangible non-current assets plus adjustments for cash flow from changes in working capital.

Cash flow from operating activities is used to monitor cash flow from operating activities.

Cash conversion

Cash flow from operating activities as a percentage of EBITDA.

Cash conversion ratio is used to monitor how efficiently the Group manages investment activities and working capital.

Order backlog

The value of outstanding, not yet accrued project income from orders received at the end of the period.

The order backlog is an indicator of the Group's outstanding project income from orders already received.

Return on equity1

Total earnings for the last 12 months as a percentage of average shareholders' equity during the corresponding period (shareholders' equity at the start and end of the period respectively divided by two).

Return on equity is important for investors who want to be able to compare their investment with alternative investments.

Return on capital employed1

Total earnings before tax plus financial expenses over the last 12 months as a percentage of capital employed during the corresponding period (sum of capital employed at the start and end of the period respectively, divided by two).

Return on capital employed is important for assessing profitability on externally financed capital and shareholders' equity.

Return on capital employed, excluding goodwill1

Total earnings before tax plus financial expenses for the last 12 months as a percentage of capital employed with deductions for goodwill and other acquisition-related intangible non-current assets over the same period (the sum of capital employed minus goodwill and other acquisition-related intangible non-current assets at the start and end of the period, divided by two).

The return on capital employed, excluding goodwill and other acquisition-related intangible non-current assets is important for assessing profitability on externally financed capital and shareholders' equity adjusted for goodwill arising from acquisitions.

Capital employed

Total capital with or without goodwill minus non-interestbearing liabilities and appropriations.

Capital employed shows by how much company assets are financed by the return on this capital.

Interest-bearing net debt2

Current and non-current interest-bearing liabilities plus current and non-current lease liabilities minus cash and cash equivalents. Earnouts are not included in this performance measure.

Interest-bearing net debt is used as a measure showing the Group's total indebtedness.

Net debt to adjusted EBITDA ratio

Net debt at the end of the period divided by adjusted EBITDA for a rolling 12-month period.

The net debt to adjusted EBITDA ratio provides an estimate of the company's ability to reduce its debt. It represents the number of years it would take to repay the debit if the net debt and adjusted EBITDA were to remain constant, without taking into consideration cash flow related to interest, tax and investments.

Net debt to equity ratio

Interest-bearing net debt as a percentage of total shareholders' equity.

The net debt to equity ratio measures the extent to which the Group is financed by loans. As cash and cash equivalents and other current investments can be used to pay off debt at short notice, net debt is used instead of gross debt in the calculation.

1The definition of performance measures has been changed as of Q1 2021. Performance measures are calculated on a rolling 12 month period instead of an annualisation of the return in the period concerned. Comparison figures have been recalculated.

2The definition of the performance measure has been changed as of Q1 2021 and now includes lease liabilities, unlike previously. Comparison figures have been recalculated.

Fasadgruppen in brief

Vision

Fasadgruppen aims to create sustainable façades and so contribute to a more sustainable and enduring society with beautiful buildings and a good living environment for people.

Business concept

The Fasadgruppen business concept is to offer competitive, multidisciplinary solutions by enabling collaboration between leading local and specialised subsidiaries to achieve economies of scale and synergy effects between the companies.

Business model

The Fasadgruppen business model is based on a decentralised structure with extensively delegated responsibilities to entrepreneurial subsidiaries supported by a Group-wide organisation with purchasing, business development, acquisitions, finance and similar services. Four geographical business areas simplify regional coordination through resource sharing and best practice, identification of cross-selling opportunities and joint sales initiatives. In this way, the entrepreneurial endeavour, convenience and modest overheads of each local company are enhanced by Group opportunities to achieve economies of scale and offer comprehensive solutions to customers.

Offering

Fasadgruppen possesses expertise in all aspects of exterior work on properties. The offering includes services within façade renovation, energy efficiency, window replacement, balcony and roof renovation.

Projects and customers

Fasadgruppen mainly focuses on medium-sized projects with an order value of SEK 1–100 million. Our customers operate in the Nordic construction and renovation market and include owners of public, commercial and residential properties, tenant-owner housing associations, construction companies and private home owners.

Strategy

Develop local market leaders

Fasadgruppen aims to maintain and grow its position on local markets by attracting and retaining the best contractors and personnel in each local market.

Promote cooperation

Synergy effects between local units are to be achieved by means of an organisation that promotes effective cooperation. The Group employs a proven model to achieve economies of scale that are implemented directly on the acquisition of a new company, ensuring optimal integration and synergies throughout the Fasadgruppen Group.

Efficient processes

Continuously optimising its processes enables the Group to be managed in the best possible way and gives subsidiaries a platform to increase their profitability.

Growth through acquisitions

Acquisitions play an important role in the Fasadgruppen strategy for profitable growth. Acquisitions enable the Group to expand geographically, broaden its offering, enhance its expertise and achieve economies of scale within existing companies.

Financial targets

Fasadgruppen's financial targets aim to ensure long-term and stable profitability and growth in value to give our shareholders a good return.

Sales growth >15%

We aim to achieve an average growth in sales of at least 15 percent per year over an entire economic cycle. Growth should be both organic and via acquisitions.

EBITA margin >10%

Our EBITA margin should be at least 10 percent per year over an entire economic cycle.

Cash conversion ratio 100%

Our cash conversion ratio should be 100 percent.

For sustainable development

Sustainability is an integral part of Fasadgruppen's business operations and strategy. hrough clear goals, long-term thinking and total commitment, we aim to contribute to sustainable development. Fasadgruppen supports Agenda 2030 and has identified five of the global sustainable development goals as the most relevant for our business.

Fasadgruppen Group AB Drottninggatan 81 A, SE 111 60 Stockholm [email protected] www.fasadgruppen.se Co. reg. number: 559158 - 4122

Contact information

Casper Tamm, CFO Tel.: +46 (0)73 820 00 07 Email: [email protected]

Adrian Westman, Head of IR Tel.: +46 (0)73 509 04 00 Email: [email protected]

Financial calendar

AGM 2022....................................................12 May 2022 Interim report January–June 2022..............16 August 2022 Interim report January–September 2022....15 November 2022 Year-end report 2022...................................14 February 2023

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