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Bravida Holding

Quarterly Report Jul 16, 2021

2897_ir_2021-07-16_0462edaf-834f-4470-8b36-9ea8f46588d9.pdf

Quarterly Report

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April–June 2021

  • Net sales increased by 3% to SEK 5,570 million (5,382)
  • The order backlog was SEK 14,908 million (14,952)
  • EBITA rose by 3% to SEK 327 million (317)
  • The EBITA margin was 5.9% (5.9)
  • Profit after tax was SEK 246 million (238)
  • Cash flow from operating activities was SEK 317 million (728)
  • Net debt amounted to SEK -1,600 million (-1,185)
  • Five acquisitions were completed in the quarter, adding annual sales of approximately SEK 349 million
  • Basic and diluted earnings per share were SEK 1.23 (1.17)

January–June 2021

• Net sales amounted to SEK 10,803 million (10,783)

INTERIM REPORT FOR

APRIL–JUNE

2021

  • EBITA rose by 1% to SEK 593 million (589)
  • The EBITA margin was 5.5% (5.5)
  • Profit after tax was SEK 448 million (433)
  • Cash flow from operating activities was
  • SEK 461 million (1,288) • Nine acquisitions were completed in the period, adding
  • annual sales of approximately SEK 574 million
  • Basic and diluted earnings per share were SEK 2.25 (2.14)

Financial overview

Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 5,570 5,382 10,803 10,783 21,147 21,167
Operating profit (EBIT) 327 317 592 588 1,348 1,353
Operating margin (EBIT), % 5.9 5.9 5.5 5.5 6.4 6.4
EBITA 327 317 593 589 1,351 1,355
EBITA margin, % 5.9 5.9 5.5 5.5 6.4 6.4
Profit/loss after tax 246 238 448 433 997 1,012
Cash flow from operating activities 317 728 461 1,288 2,171 1,344
Cash conversion, % 12 m 89 149 89 149 153 89
Net debt/EBITDA, 12 m 0.9 0.7 0.9 0.7 0.6 0.9
Order intake 5,973 5,346 11,774 11,078 20,242 20,938
Order backlog 14,908 14,952 14,908 14,952 13,791 14,908

We bring buildings to life

Recovery in the service business generated growth in the quarter

Organic growth in Sweden, Denmark and Finland. Order intake grew by 12 percent, fuelled by good service demand, which grew in the quarter. Improved demand for installation projects increased the order backlog by SEK 510 million.

Net sales and EBITA margin

Given strong comparative figures and a continued negative impact from the pandemic, mainly in Norway, I am satisfied with performance in the quarter.

Net sales increased by 3 percent in the quarter. Sales within service increased in all countries, while installation project volumes decreased in Norway and Denmark. However, we note a positive trend at the end of the quarter mainly in Denmark.

The service business grew by 13 percent, contributing to organic growth of almost half a percentage point. We are reporting organic growth in all countries apart from Norway, which was affected by increased lockdowns at the start of the quarter.

The lower production rate in the installation business was due to the weaker order intake in 2020. Some delays in project planning and start-up by customers also contributed to lower activity. The order backlog for installation projects grew by SEK 1.1 billion in the first half of the year, which will lead to increased production volumes over the next few quarters.

The EBITA margin, which was unchanged at 5.9 percent, improved in Sweden and Finland and was unchanged in Norway and Denmark. Our Finnish operations continue to move in a positive direction as a result of good project selection and increased service activities, as well as a stronger market position.

Cash flow

Operating cash flow decreased in the quarter. Last year cash flow reached a historic high, which was due to very low levels of working capital. This year we see a normalisation in the working capital in the first two quarters compared with last year, which is leading to lower cash flow from operating activities. Working capital in relation to net sales remains at a good level of -6.8 percent.

We also have some large outstanding receivables in Denmark from two public-sector customers, which have had a negative impact on cash flow during the year. These projects are in their final phase of production and the disputes will be settled by an arbitral tribunal. Our assesment is that these are not expected to have any significant impact on earnings.

Acquisitions

So far in 2021, we have completed 10 acquisitions, including one in July, with total annual sales of around SEK 584 million.

As previously announced, we have signed a letter of intent to acquire the Minel Group in Norway. The letter of intent is valid until 30 September 2021, but both parties agree that the preconditions for completing the deal do not currently exist. Our assessment is that acquisition opportunities generally

remain very good.

"During the quarter, service sales

Sustainability

Our increased focus on sustainable services has resulted in the launch of GreenHub and Bravida Charge. GreenHub is a fossil-free service concept that we offer our customers in nine cities across the Nordic region. March saw the introduction of Bravida Charge, a complete solution for electric car charging and payment management. Demand is good and the first deliveries were made in the second quarter.

Our own climate footprint has the highest focus and as part of that, our fleet will consist of at least 30 percent fossil-free vehicles by 2025. More than 160 electric vehicles have been ordered so far this year.

Outlook

We are seeing a clear recovery in the service business and demand has normalised in the quarter, following a considerable decline in 2020 due to the pandemic. Demand for installations improved in the spring. The installation business is seeing growing demand for new-builds and the refurbishment of residential, industrial and warehouse buildings, as well as the remodelling and upgrading of office space.

As everyone is aware and as previously announced, raw material prices are rising sharply and there is a risk of material shortages in some areas. Bravida has a good system for dealing with this. We work with both contracts and long-term partnerships on the supplier side and with price increases in respect of customers. We therefore see no significant risk that higher commodity prices will affect our margin in the longer term.

The market outlook improved during the quarter and demand for sustainable low-carbon solutions will contribute to a growing market.

Mattias Johansson Stockholm, July 2021

Consolidated earnings overview

Net sales

April–June

Net sales increased by 3 percent to SEK 5,570 million (5,382). Organic growth was 0 percent, acquisitions boosted net sales by 3 percent and currency effects had an impact of 0 percent. Net sales rose in Sweden, Denmark and Finland.

Compared with the second quarter of 2020, net service sales increased by 13 percent, while net installation sales declined by 4 percent. The service business accounted for 47 percent (43) of total net sales.

Order intake increased by 12 percent to SEK 5,973 million (5,346). Order intake rose in Sweden, Denmark and Finland. The order backlog was SEK 14,908 million (14,952). The order backlog, including acquisitions, rose by SEK 510 million in the quarter. The order backlog only includes installation projects.

January–June

Net sales amounted to SEK 10,803 million (10,783). Organic growth was negative at -2 percent, acquisitions boosted net sales by 3 percent and currency effects had a negative impact of -1 percent. Net sales rose in Sweden, Denmark and Finland.

Compared with same period in 2020, net service sales increased by 7 percent and net installation sales decreased by 5 percent. The service business accounted for 48 percent (45) of total net sales.

Order intake amounted to SEK 11,774 million (11,078), an increase of 6 percent. Order intake increased in Sweden and Norway and was unchanged in Denmark. The order backlog, including acquisitions, rose by SEK 1,117 million in the period.

Earnings

April–June

Operating profit was SEK 327 million (317). EBITA increased by 3 percent to SEK 327 million (317), resulting in an unchanged EBITA margin of 5.9 percent. The EBITA margin increased in Sweden and Finland, but was unchanged in Norway and Denmark. Group-wide income was SEK -9 million (-2). Net financial income/expense amounted to SEK -15 million (-13). Profit after financial items was SEK 312 million (303). Profit after tax was SEK 246 million (238). Basic and diluted earnings per share increased by 4 percent to SEK 1.23 (1.17).

January–June

Operating profit was SEK 592 million (588). EBITA increased by 1 percent to SEK 593 million (589), resulting in an improved EBITA margin of 5.5 percent. The EBITA margin improved in

Norway, Denmark and Finland, but was unchanged in Sweden. Group-wide income was SEK -8 million (8). Net financial income/ expense amounted to SEK -24 million (-35). Profit after financial items was SEK 568 million (553). Profit after tax was SEK 448 million (433). Basic and diluted earnings per share increased by 5 percent to SEK 2.25 (2.14).

Depreciation and amortisation

Depreciation and amortisation in the quarter totalled SEK -109 million (-104), SEK -100 million (-96) of which related to the amortisation of right-of-use assets. Depreciation and amortisation in the January–June period totalled SEK -215 million (-211), SEK -197 million (-193) of which related to the amortisation of right-of-use assets.

Tax

The tax expense for the quarter was SEK -66 million (-66). Profit before tax was SEK 312 million (303). Tax paid totalled SEK -52 million (-52).

The tax expense for January to June was SEK -120 million (-120). Profit after tax was SEK 568 million (553). Tax paid totalled SEK -118 million (-124).

Cash flow

April–June

Cash flow from operating activities before changes in working capital totalled SEK 368 million (389). Changes in working capital amounted to SEK -51 (339) million. Current receivables increased by SEK 675 million, current liabilities rose by SEK 627 million and inventory increased by SEK 3 million. Cash flow from operating activities was SEK 317 million (728).

Cash flow from investing activities was SEK -148 million (-146), of which acquisitions of subsidiaries and businesses totalled SEK -135 million (-139). Cash flow from financing activities, which refers to the net change in borrowing, the dividend and amortisation of lease liabilities, was SEK -207 million (-590). Cash flow for the quarter was SEK -37 million (-8). 12-month cash conversion was 89 percent (149).

January–June

Cash flow from operating activities before changes in working capital totalled SEK 670 million (683). The change in working capital amounted to SEK -209 million (605).The change is due to higher trade receivables mainly because of a high level of billing at the end of the period and some outstanding receivables in Denmark. Lower activity in the installation business is leading

Net sales (SEK million)

Net sales by quarter

Order intake by quarter

Order intake, rolling 12 months

to fewer project starts with initially good cash flows. In addition, projects that initially had good payment plans have progressed further in terms of completion, naturally leading to them having lower cash flow. Last year's extension period for tax payments due to Covid-19, which were paid in the first half of the year, has also impacted cash flow. Current receivables increased by SEK 958 million, current liabilities rose by SEK 754 million and inventory increased by SEK 5 million.

Cash flow from operating activities was SEK 461 million (1,288).

Cash flow from investing activities was SEK -290 million (-227), of which acquisitions of subsidiaries and businesses totalled SEK -271 million (-217).

Cash flow from financing activities, which refers to net repayment of borrowing, dividends and amortisation of lease liabilities, was SEK -654 million (-860). Cash flow for the period was SEK -483 million (200).

Financial position

Bravida's net debt at 30 June was SEK -1,600 million (-1,185), which corresponds to a capital structure (net debt/adjusted EBITDA) ratio of 0.9 (0.7). A dividend of SEK 507 million was paid in the quarter, whereas in the previous year the dividend was paid in quarter 4. Consolidated cash and cash equivalents were SEK 1,302 million (1,103). Interest-bearing liabilities totalled SEK -2,902 million (-2,288), of which SEK -1,400 million (-120) was commercial paper and SEK -1,002 million (-949) was leases.

Total credit facilities amounted to SEK 2,500 million (2,500), of which SEK 2,500 million (2,300) was unused at 30 June. At the end of the period, equity totalled SEK 5,991 million (5,819). The equity/assets ratio was 33.2 percent (34.6).

Acquisitions

Five acquisitions were completed during the quarter, adding a total of around SEK 349 million in annual sales. Nine acquisitions were completed in the January–June period, adding total annual sales of approximately SEK 574 million. See also Note 3.

Employees

The average number of employees at 30 June was 11,763 (11,940), a decrease of 1 percent.

Occupational injuries

Reported occupational injuries that led to at least one day's sickness absence decreased by 9 percent over the past 12 months to a LTIR (lost time injury rate) of 8.7 (9.6). In Sweden the LTIR was 9.9, in Norway it was 2.8, in Denmark 11.7 and in Finland 12.3. LTIR increased in Sweden but decreased in other countries. Our target is a LTIR of <5.5, with an ultimate goal of zero workplace accidents.

Parent company

Revenues for the quarter were SEK 50 million (49) and income after net financial items was SEK -9 million (-1). Revenues for the January–June period were SEK 96 million (97) and earnings after net financial items were SEK -1 million (-1).

Shareholder information

Bravida Holding AB's ordinary shares are listed on the Nasdaq Stockholm Large Cap list. At 30 June Bravida had 9,980 shareholders. The five largest shareholders were Mawer Investment Management, Swedbank Robur Funds, the Fourth Swedish National Pension Fund (AP4), Lannebo Funds and Handelsbanken Funds. Mawer Investment Management holds just over 11 percent of the votes.

The listed share price at 30 June 2021 was SEK 123.80, which corresponds to a market capitalisation of SEK 25,171 million based on the number of ordinary shares. Total shareholder return over the past 12 months was just over 17 percent.

Share capital totals SEK 4 million, divided among 203,816,598 shares, of which 203,323,771 are ordinary shares and 492,827 are class C shares, which are held by Bravida Holding AB. Ordinary shares entitle holders to one vote and a dividend payment, while C shares entitle holders to one-tenth of a vote and no dividend.

Financial goals

  • Sales growth: over 5 percent a year
  • EBITA margin: over 7 percent
  • Cash conversion: over 100 percent
  • Net debt/EBITDA: under 2.5x
  • Dividend: over 50 percent of net profit

Other events during the period AGM of 26 April

It was resolved, in accordance with the Nomination Committee's proposal, to re-elect Fredrik Arp, Cecilia Daun Wennborg, Jan Johansson, Marie Nygren, Staffan Påhlsson and Karin Stålhandske as members of the Board for the period until the end of the next Annual General Meeting.

The following Board proposals were approved

  • To adopt the proposed dividend of SEK 2.50 per share
  • To adopt a long-term incentive programme aimed at senior executives and other key personnel in the Bravida Group
  • To authorise the Board to take decisions regarding a new issue of C shares
  • To authorise the Board to take decisions regarding the buyback of C shares and the transfer of treasury shares

In May the Board took the decision to convert 348,227 C shares into ordinary shares to be provided to participants in the long-

Net sales and growth
Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Net sales 5,570 5,382 10,803 10,783 21,147
Change 188 295 20 683 743
Change, % 3.5 5.8 0.2 6.8 3.6
Of which
Organic growth, % 0 3 -2 2 1
Acquisition-based growth, % 3 6 3 6 5
Currency effects, % 0 -3 -1 -1 -2

tions. Operating risks are related to day-to-day business opera-

Director and became a member of Group management.

Changes in market conditions, financial turmoil and political decisions are the external factors that mainly affect demand for new construction of housing and commercial property, as well as investment from industry and the public sector. Demand for service and maintenance is less sensitive to economic fluctua-

tions such as tendering, price risks, capacity utilisation and revenue recognition. Management of these risks is part of Bravida's business process. Recognition over time is applied and is based

term incentive programme 2018. These were transferred to the

In May, Andreas Olofsson took up the position of Group HR

incentive programme participants.

on the extent of completion of each project and the expected date of completion. A well-developed process for the monitoring of projects is essential in limiting the risk of incorrect revenue recognition. Bravida continually monitors the financial status of each project to ensure that individual project calculations are not exceeded. The Group is also exposed to impairment loss risks in fixed-price contracts and various types of financial risk such as currency, interest rate and credit risk.

Transactions with related parties

No transactions with related parties outside the Group took place during the period.

Events since the end of the period

On 1 July, the acquisition of Dala Klimat, with sales of SEK 10 million and 4 employees, took place.

EBITA (SEK million)

Significant risks

EBITA by quarter

EBITA, rolling 12 months

EBITA margin, %

Cash flow from operating activities (SEK million)

Cash flow from operating activities by quarter

Cash flow from operating activities, rolling 12 months

Sustainable initiatives and a smaller carbon footprint

Bravida launches GreenHub: fossil-free, fast service throughout the Nordics

As Bravida's fleet of vehicles goes electric, alternative transport options are also being expanded across the Group as of 1 September. Our GreenHub concept focuses solely on electric bicycles, electric mopeds and walking. It reduces both our own and our customers' carbon footprint, making GreenHub a sustainable investment.

GreenHub was launched in Oslo in autumn 2020 and has been a huge success. The project is now being extended to eight more of the Nordic region's larger cities; Stockholm,

Gothenburg, Bergen, Trondheim, Kristiansand, Copenhagen, Aarhus and Helsinki. Bravida will be the green service partner in the heart of the Nordic region's largest cities. The aim is to contribute in every we can towards achieving the UN's Sustainable Development Goals for 2030.

GreenHub will only ever be 15 minutes away from customers, ensuring quick delivery of our services. Delivery times are also reduced by avoiding traffic jams and not having to find parking spaces.

GreenHub will open in Stockholm, Gothenburg, Copenhagen, Aarhus, Helsinki and Trondheim on 1 September 2021.

Bravida Charge: the complete solution for your electric car

Another initiative from Bravida is the launch of Bravida Charge, a comprehensive solution for electric vehicles. Bravida Charge includes the installation of the charging point, operation, monitoring, remote support and payment solution, controlled via an app. Bravida Charge meets the growing need for an electrified infrastructure for both business customers and private individuals.

Bravida Charge allows us to help our customers reduce their carbon footprint while also cutting our own emissions, as at least 30% of Bravida's service vehicles will be fossil free by 2025.

Bravida Charge is currently available in Sweden and Denmark, and will soon be launched in Finland and Norway.

Operations in Sweden

Market

The confidence indicator for the construction industry improved in the quarter and was above the normal level.

Independent market assessments for 2021/2022 indicate an improvement in the service market, a solid installation market and a growing overall market.

Net sales and earnings

April–June

Net sales increased by 5 percent to SEK 3,119 million (2,961). The increase in net sales was attributable to both service and installation business. Organic growth was 2 percent.

EBITA rose by 7 percent to SEK 203 million (190). The EBITA margin increased to 6.5 (6.4) percent.

January–June

Net sales increased by 3 percent to SEK 5,959 million (5,768). The increase in net sales was attributable to both service and installation business. Organic growth was 0 percent.

EBITA increased by 4 percent to SEK 358 million (345). The EBITA margin was unchanged at 6.0 percent.

Order intake and order backlog April–June

Order intake increased by 14 percent to SEK 3,532 million (3,096). A large order of approximately SEK 270 million was recorded in the quarter relating to the reconstruction of Stockholm's Slussen area. In other respects, order intake related to small and medium-sized installation projects and service assignments.

The order backlog at the end of the quarter was SEK 9,235 million (9,245) percent. The order backlog rose by SEK 521 million in the quarter.

January–June

Order intake increased by 12 percent to SEK 6,686 million (5,993).

Operations in Sweden

Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 3,119 2,961 5,959 5,768 11,313 11,504
EBITA 203 190 358 345 801 813
EBITA margin, % 6.5 6.4 6.0 6.0 7.1 7.1
Order intake 3,532 3,096 6,686 5,993 10,677 11,370
Order backlog 9,235 9,245 9,235 9,245 8,400 9,235
Average number of employees 5,683 5,934 5,683 5,934 5,831 5,580

Net sales (SEK million)

Net sales by quarter Net sales, rolling 12 months EBITA (SEK million)

EBITA by quarter EBITA, rolling 12 months

Operations in Norway

Market

Independent market assessments for 2021/2022 indicate an improvement in the service market, a solid installation market and a growing overall market.

Net sales and earnings

April–June

The pandemic has continued to have a negative impact on business. Net sales decreased by 6 percent to SEK 987 million (1,048). Net sales from the installation business decreased, while service business sales increased in the quarter. Currency fluctuations had a positive 4 percent impact on net sales. Organic growth was negative at -10 percent.

EBITA decreased by 5 percent to SEK 64 million (67). The EBITA margin was unchanged at 6.4 percent.

January–June

Net sales decreased by 13 percent to SEK 1,968 million (2,262). Net sales decreased in the installation business and increased in the service business. Currency fluctuations had a negligible impact on net sales. Organic growth was negative at -13 percent. EBITA decreased by 11 percent to SEK 108 million (121). The EBITA margin increased to 5.5 (5.3) percent.

Order intake and order backlog April–June

Order intake decreased by 14 percent to SEK 919 million (1,067). Order intake mainly relates to small and medium-sized installation projects and service assignments.

The order backlog at the end of the quarter was 2 percent higher than for the same period last year and amounted to SEK 2,401 million (2,359). The order backlog decreased by SEK 67 million in the quarter.

January–June

Order intake increased by 10 percent to SEK 2,272 million (2,068). Order intake mainly relates to small and medium-sized installation projects and service assignments.

Operations in Norway

Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 987 1,048 1,968 2,262 4,304 4,010
EBITA 64 67 108 121 245 232
EBITA margin, % 6.4 6.4 5.5 5.3 5.7 5.8
Order intake 919 1,067 2,272 2,068 3,848 4,052
Order backlog 2,401 2,359 2,401 2,359 2,097 2,401
Average number of employees 2,892 2,936 2,892 2,936 2,997 2,953

Net sales (SEK million)

Net sales by quarter

Net sales, rolling 12 months

EBITA (SEK million)

Operations in Denmark

Market

The confidence indicator for the construction industry improved in the quarter and was above the normal level.

Independent market assessments for 2021/2022 indicate an improvement in the service market, a weaker installation market and a slight decrease in the overall market.

Net sales and earnings

April–June

Net sales increased by 3 percent to SEK 1,082 million (1,052). The increase in net sales was attributable to the service business.

Organic growth was 4 percent. Currency fluctuations had a negative 5 percent impact on net sales.

EBITA increased by 2 percent to SEK 54 million (53), while the EBITA margin was unchanged at 5.0 percent.

January–June

Net sales increased by 1 percent to SEK 2,146 million (2,119). The increase in net sales was attributable to the service business. Organic growth was 2 percent. Currency fluctuations had a negative 5 percent impact on net sales. EBITA increased by 6 percent to SEK 110 million (104), while the EBITA margin rose to 5.1 percent (4.9).

Order intake and order backlog April–June

Order intake increased by 24 percent compared with the same period last year, and amounted to SEK 1,117 million (903). Order intake related to small and medium-sized installation projects and service assignments.

The order backlog at the end of the quarter was 3 percent higher than for the same period last year and amounted to SEK 2,467 million (2,398). The order backlog rose by SEK 35 million in the quarter.

January–June

The order intake was SEK 2,162 million (2,159). Order intake related to small and medium-sized installation projects and service assignments.

Operations in Denmark

Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 1,082 1,052 2,146 2,119 4,217 4,244
EBITA 54 53 110 104 220 225
EBITA margin, % 5,0 5.0 5.1 4.9 5.2 5.3
Order intake 1,117 903 2,162 2,159 4,277 4,279
Order backlog 2,467 2,398 2,467 2,398 2,451 2,467
Average number of employees 2,366 2,269 2,366 2,269 2,315 2,411

Net sales (SEK million)

Net sales by quarter

Net sales, rolling 12 months

EBITA (SEK million)

EBITA, rolling 12 months

Operations in Finland

Market

The confidence indicator for the construction industry improved in the quarter but remained below normal. Independent market assessments for 2021/2022 indicate an improvement in the service market and installation market and a growing overall market.

Net sales and earnings

April–June

Net sales increased by 22 percent to SEK 400 million (328). The increase in net sales was attributable to both service and installation business. Organic growth was 12 percent. Currency fluctuations had a negative 5 percent impact on net sales.

EBITA rose by SEK 6 million to SEK 16 million (10). The EBITA margin increased to 4.0 (3.0) percent.

January–June

Net sales increased by 20 percent to SEK 783 million (653). The increase in net sales was attributable to both service and installation business. Organic growth was 15 percent. Currency fluctuations had a negative 5 percent impact on net sales.

EBITA rose by SEK 15 million to SEK 26 million (11). The EBITA margin increased to 3.3 (1.7) percent.

Order intake and order backlog April–June

Order intake increased by 47 percent to SEK 422 million (286). Order intake related to small and medium-sized installation projects and service assignments.

The order backlog at the end of the quarter was 15 percent lower than for the same period last year and amounted to SEK 804 million (950). The order backlog rose by SEK 22 million in the quarter.

January–June

Order intake decreased by 19 percent to SEK 707 million (875). The lower order intake was due to Bravida receiving a large order last year.

Operations in Finland

Amounts in SEK million Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 400 328 783 653 1,392 1,522
EBITA 16 10 26 11 56 71
EBITA margin, % 4.0 3.0 3.3 1.7 4.0 4.7
Order intake 422 286 707 875 1,518 1,350
Order backlog 804 950 804 950 842 804
Average number of employees 714 704 714 704 666 676

Net sales (SEK million)

Net sales by quarter

Net sales, rolling 12 months

EBITA (SEK million)

EBITA, rolling 12 months

Financial reporting

Consolidated income statement, summary

SEK MILLION Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Net sales 5,570 5,382 10,803 10,783 21,147 21,167
Production costs -4,784 -4,632 -9,304 -9,320 -18,093 -18,078
Gross profit/loss 786 750 1,499 1,463 3,054 3,089
Selling and administrative expenses -459 -433 -907 -876 -1,706 -1,736
Operating profit/loss 327 317 592 588 1,348 1,353
Net financial income/expense -15 -13 -24 -35 -74 -64
Profit/loss before tax 312 303 568 553 1,274 1,289
Tax -66 -66 -120 -120 -276 -277
Profit/loss for the period 246 238 448 433 997 1,012
Profit/loss for the period attributable to:
Owners of the parent company 249 238 456 434 1,002 1,024
Non-controlling interests -3 -1 -7 -1 -5 -12
Profit/loss for the period 246 238 448 433 997 1,012
Basic earnings per share, SEK 1.23 1.17 2.25 2.14 4.94 5.05
Diluted earnings per share, SEK 1.23 1.17 2.25 2.14 4.93 5.04

Consolidated statement of comprehensive income, summary

SEK MILLION Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Jul 2020–
Jun 2021
Profit/loss for the period 246 238 448 433 997 1,012
Other comprehensive income
Items that have been or can be transferred to
profit/loss for the year
Translation differences for the period from the translation
of foreign operations
-46 -62 52 -102 -150 4
Items that cannot be transferred to profit/loss for the year
Revaluation of defined-benefit pensions 134 60 134 60 10 84
Tax attributable to the revaluation of pensions -29 -13 -29 -13 -2 -18
Other comprehensive income for the period 59 -15 157 -55 -142 70
Comprehensive income for the period 305 223 606 379 855 1,082
Comprehensive income for the period attributable to:
Owners of the parent company 308 224 606 379 860 1,087
Non-controlling interests -3 -1 -1 -1 -5 -5
Comprehensive income for the period 305 223 606 379 855 1,082

Consolidated balance sheet, summary

SEK MILLION 30 Jun 2021 30 Jun 2020 31 Dec 2020
Goodwill 9,223 8,908 8,904
Right-of-use assets 981 936 1,002
Other non-current assets 201 174 179
Total non-current assets 10,405 10,017 10,084
Trade receivables 3,824 3,442 3,391
Contract assets 1,911 1,705 1,257
Other current assets 596 564 574
Cash and cash equivalents 1,302 1,103 1,748
Total current assets 7,634 6,813 6,969
Total assets 18,039 16,830 17,053
Equity attributable to owners of the parent company 5,977 5,813 5,855
Non-controlling interests 15 6 21
Total equity 5,991 5,819 5,876
Non-current liabilities 1,679 2,151 1,770
Lease liabilities 662 627 679
Total non-current liabilities 2,341 2,778 2,449
Lease liabilities 340 322 343
Trade payables 2,311 2,191 2,123
Contract liabilities 2,493 2,292 2,049
Other current liabilities 4,562 3,428 4,213
Total current liabilities 9,707 8,233 8,728
Total liabilities 12,048 11,012 11,177
Total equity and liabilities 18,039 16,830 17,053
Of which interest-bearing liabilities 2,902 2,288 2,872

Changes in equity

SEK MILLION Jan–Jun 2021 Jan–Jun 2020 Jan–Dec 2020
Consolidated equity
Amount at start of period 5,876 5,596 5,596
Comprehensive income for the period 742 379 855
Non-controlling interests' put option -137 -166 -136
Dividend -507 -457
Long-term incentive programme 17 9 17
Amount at end of period 5,991 5,819 5,876

Consolidated cash flow statement, summary

SEK MILLION Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Cash flow from operating activities
Profit/loss before tax 312 303 568 553 1,274
Adjustments for non-cash items 108 138 219 254 569
Income taxes paid -52 -52 -118 -124 -244
Change in working capital -51 339 -209 605 572
Cash flow from operating activities 317 728 461 1,288 2,171
Investing activities
Acquisitions of subsidiaries and businesses -135 -139 -271 -217 -281
Other -13 -6 -19 -10 -34
Cash flow from investing activities -148 -146 -290 -227 -316
Financing activities
Net change in borrowing 400 -496 50 -671 -145
Repayment of lease liabilities -99 -94 -197 -189 -388
Dividend paid -507 -507 -457
Cash flow from financing activities -207 -590 -654 -860 -990
Cash flow for the period -37 -8 -483 200 866
Cash and cash equivalents at start of period 1,367 1,131 1,748 972 972
Translation difference on cash and cash equivalents -27 -21 38 -69 -90
Cash and cash equivalents at end of period 1,302 1,103 1,302 1,103 1,748

Parent company income statement, summary

SEK MILLION Apr–Jun
2021
Apr–Jun
2020
Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Net sales 50 49 96 97 192
Selling and administrative expenses -55 -49 -91 -89 -154
Operating profit/loss -5 0 6 9 38
Net financial income/expense -5 -1 -7 -10 -21
Profit/loss after net financial items -9 -1 -1 -1 17
Net Group contributions 140
Appropriations -40
Profit/loss before tax -9 -1 -1 -1 117
Tax -26
Profit/loss for the period -9 -1 -1 -1 91

Parent company balance sheet, summary

SEK MILLION 30 Jun 2021 30 Jun 2020 31 Dec 2020
Shares in subsidiaries 7,341 7,341 7,341
Deferred tax asset 0 0 0
Total non-current assets 7,341 7,341 7,341
Receivables from Group companies 1,170 1,474 1,225
Current receivables 52 51 45
Total current receivables 1,222 1,525 1,270
Cash and bank balances 1,148 956 1,626
Total current assets 2,370 2,481 2,897
Total assets 9,712 9,823 10,238
Restricted equity 4 4 4
Non-restricted equity 3,604 4,452 4,096
Equity 3,608 4,456 4,100
Untaxed reserves 520 480 520
Liabilities to credit institutions 500 1,000 500
Provisions 1 6 1
Total non-current liabilities 501 1,006 501
Short-term loans 1,400 320 1,350
Liabilities to Group companies 3,636 3,520 3,708
Current liabilities 47 41 60
Total current liabilities 5,083 3,882 5,118
Total equity and liabilities 9,712 9,823 10,238
Of which interest-bearing liabilities 1,900 1,320 1,850

Quarterly data

INCOME STATEMENT, SEK MILLION Apr–Jun
2021
Jan–Mar
2021
Oct–Dec
2020
Jul–Sep
2020
Apr–Jun
2020
Jan–Mar
2020
Oct–Dec
2019
Jul–Sep
2019
Net sales 5,570 5,233 5,614 4,750 5,382 5,401 5,667 4,638
Production costs -4,784 -4,520 -4,671 -4,103 -4,632 -4,688 -4,743 -4,004
Gross profit/loss 786 713 943 647 750 713 924 634
Selling and administrative
expenses
-459 -447 -466 -364 -433 -442 -500 -358
Operating profit/loss 327 266 477 283 317 271 424 276
Net financial income/expense -15 -9 -28 -12 -13 -21 -17 -16
Profit/loss after financial items 312 256 449 271 303 250 407 259
Tax -66 -54 -99 -58 -66 -54 -105 -58
Profit/loss for the period 246 202 351 213 238 196 303 202
BALANCE SHEET 30 Jun 2021 31 Mar 2021 31 Dec 2020 30 Sep 2020 30 Jun 2020 31 Mar 2020 31 Dec 2019 30 Sep 2019
Goodwill 9,223 9,081 8,904 8,957 8,908 8,807 8,731 8,743
Other non-current assets 1,182 1,183 1,180 1,045 1,110 1,182 1,208 1,085
Current assets 6,332 5,654 5,221 5,675 5,710 5,807 5,599 5,697
Cash and cash equivalents 1,302 1,367 1,748 1,129 1,103 1,131 972 467
Total assets 18,039 17,285 17,053 16,807 16,830 16,928 16,510 15,992
Equity 5,991 6,186 5,876 6,033 5,819 5,758 5,596 5,355
Borrowings 500 300 500 1,012 1,018 800 500 1,100
Non-current liabilities 1,841 1,950 1,949 1,717 1,760 1,717 1,700 1,548
Current liabilities 9,707 8,848 8,728 8,045 8,233 8,653 8,714 7,988
Total equity and liabilities 18,039 17,285 17,053 16,807 16,830 16,928 16,510 15,992
Apr–Jun Jan–Mar Oct–Dec Jul–Sep Apr–Jun Jan–Mar Oct–Dec Jul–Sep
CASH FLOW 2021 2021 2020 2020 2020 2020 2019 2019
Cash flow from operating activities 317 144 873 10 728 560 989 65
Cash flow from investing activities -148 -142 -62 -27 -146 -81 -79 -130
Cash flow from financing activities -207 -448 -172 43 -590 -270 -385 -12
Cash flow for the period -37 -446 639 26 -8 208 525 -77
Apr–Jun Jan–Mar Oct–Dec Jul–Sep Apr–Jun Jan–Mar Oct–Dec Jul–Sep
KEY RATIOS 2021 2021 2020 2020 2020 2020 2019 2019
Operating margin (EBIT), % 5.9 5.1 8.5 6.0 5.9 5.0 7.5 6.0
EBITA margin, % 5.9 5.1 8.5 6.0 5.9 5.0 7.5 6.0
Return on equity, % 16.6 16.6 16.7 16.0 16.2 15.9 16.2 18.2
Net debt -1,600 -1,134 -1,124 -1,230 -1,185 -1,698 -2,063 -2,735
Net debt/EBITDA 0.9 0.6 0.6 0.7 0.7 1.0 1.3 1.8
Cash conversion*, % 89 121 153 167 149 127 115 104
Interest coverage, multiple 23.0 25.4 32.9 29.8 24.5 25.0 34.6 19.7
Equity/assets ratio, % 33.2 35.8 34.5 35.9 34.6 34.0 33.9 33.5
Order intake 5,973 5,801 5,140 4,024 5,346 5,732 5,546 5,055
Order backlog 14,908 14,397 13,791 14,274 14,952 14,985 14,485 14,507
Average number of employees 11,763 11,731 11,906 11,972 11,940 11,811 11,722 11,584
Administrative expenses as % of sales 8.2 8.5 8.3 7.7 8.1 8.2 8.8 7.7
Working capital as % of sales -6.8 -6.8 -7.5 -6.7 -8.1 -6.5 -5.6 -3.1
Basic earnings per share, SEK 1.23 1.02 1.73 1.07 1.17 0.97 1.50 0.99
Diluted earnings per share, SEK 1.23 1.02 1.73 1.07 1.17 0.96 1.50 0.99
Equity per share, SEK 29.39 30.40 28.85 29.72 28.64 28.37 27.57 26.34
Cash flow from operating activities per
share, SEK
1.56 0.71 4.30 0.05 3.59 2.76 4.88 0.32
Share price at balance sheet date, SEK 123.80 120.30 109.50 109.20 89.05 70.15 90.95 86.35

Reconciliation of key ratios, not defined under IFRS.

The company presents certain financial measures in this interim report that are not defined under IFRS. The company considers that these indicators provide valuable additional information for investors and the company's management as they allow relevant trends to be assessed. Bravida's definitions of these indicators may differ from other companies' definitions of the same terms. These financial measures should therefore be regarded as complementary rather than replacing the measures defined under IFRS. See page 20 for definitions of key performance indicators.

Reconciliation of key performance
measures, not defined under IFRS.
SEK MILLION
Apr–Jun
2021
Jan–Mar
2021
Oct–Dec
2020
Jul–Sep
2020
Apr–Jun
2020
Jan–Mar
2020
Oct–Dec
2019
Jul–Sep
2019
Net debt
Interest-bearing liabilities -2,902 -2,501 -2,872 -2,359 -2,288 -2,830 -3,035 -3,202
Cash and cash equivalents 1,302 1,367 1,748 1,129 1,103 1,131 972 467
Total net debt -1,600 -1,134 -1,124 -1,230 -1,185 -1,698 -2,063 -2,735
EBITA
Operating profit, EBIT 327 266 477 283 317 271 424 276
Amortisation and impairment of
non-current intangible assets
1 0 0 1 1 1 1 1
EBITA 327 266 478 284 317 272 425 276
EBITDA
Operating profit, EBIT 327 266 477 283 317 271 424 276
Depreciation, amortisation and
impairment losses 109 107 121 102 104 106 111 105
EBITDA 435 372 599 385 421 377 535 380
Working capital
Current assets 7,634 7,021 6,969 6,804 6,813 6,938 6,571 6,164
Cash and cash equivalents -1,302 -1,367 -1,748 -1,129 -1,103 -1,131 -972 -467
Current liabilities -9,707 -8,848 -8,728 -8,045 -8,233 -8,653 -8,714 -7,988
Lease, current liability 340 339 343 308 322 336 340 336
Short-term loans 1,400 1,200 1,350 465 320 1,020 1,495 1,180
Provisions 206 220 226 173 172 141 144 142
Total working capital -1,429 -1,434 -1,587 -1,424 -1,709 -1,349 -1,136 -633
Interest coverage ratio
Profit/loss before tax 312 256 449 271 303 250 407 259
Interest expense 14 11 14 9 13 10 12 14
Total 326 267 463 281 316 260 419 273
Interest expense 14 11 14 9 13 10 12 14
Interest coverage, multiple 23.0 25.4 32.9 29.8 24.5 25.0 34.6 19.7
Cash conversion*
12-month EBITDA 1,366 1,357 1,363 1,316 1,308 1,264 1,244 1,258
Non-cash items in EBITDA,
last 12 months
96 130 135 55 50 30 -2 81
Change in working capital,
last 12 months
-242 148 572 800 560 298 179 -44
Investments in machinery and
equipment, last 12 months
-43 -36 -34 -40 -27 -28 -34 -23
Total operating cash flow 1,177 1,599 2,036 2,131 1,891 1,564 1,387 1,272
Operating profit/loss, last 12 months 1,330 1,321 1,328 1,279 1,272 1,228 1,209 1,223
Cash generation, last 12 months, % 89 121 153 167 149 127 115 104

*Excluding IFRS 16 Leases.

Notes

NOTE 1. Accounting policies

This is a translation of the Swedish Interim Report of Bravida Holding AB. In the event of inconsistency between the English and the Swedish versions, the Swedish version shall prevail.

This interim report for the Group has been prepared in accordance with International Reporting Standards (IFRS) using IAS 34 Interim Reporting. The parent company applies Recommendation RFR 2 Accounting for Legal Entities and Chapter 9 of the Swedish Annual Accounts Act regarding interim reports. The accounting policies applied are consistent with what is set out in the 2020 annual accounts.

The IASB has published supplements to standards effective from 1 January 2021 or later. Such supplements have not had any material impact on Bravida's financial statements.

All amounts in this interim report are stated in millions of Swedish kronor (SEK), unless specified otherwise, and rounding differences may therefore occur.

NOTE 2. Segment reporting and revenue distribution

Net sales by country

SEK MILLION Apr–Jun
2021
distri
bution
Apr–Jun
2020
distri
bution
Jan–Jun
2021
distri
bution
Jan–Jun
2020
distri
bution
Jan–Dec
2020
distri
bution
Sweden 3,119 56% 2,961 55% 5,959 55% 5,768 53% 11,313 53%
Norway 987 18% 1,048 19% 1,968 18% 2,262 21% 4,304 20%
Denmark 1,082 19% 1,052 20% 2,146 20% 2,119 20% 4,217 20%
Finland 400 7% 328 6% 783 7% 653 6% 1,392 7%
Group-wide and eliminations -18 -7 -53 -19 -79
Total 5,570 5,382 10,803 10,783 21,147

EBITA, EBITA margin and profit/loss before tax

SEK MILLION Apr–Jun
2021
EBITA
margin
Apr–Jun
2020
EBITA
margin
Jan–Jun
2021
EBITA
margin
Jan–Jun
2020
EBITA
margin
Jan–Dec
2020
EBITA
margin
Sweden 203 6.5% 190 6.4% 358 6.0% 345 6.0% 801 7.1%
Norway 64 6.4% 67 6.4% 108 5.5% 121 5.3% 245 5.7%
Denmark 54 5.0% 53 5.0% 110 5.1% 104 4.9% 220 5.2%
Finland 16 4.0% 10 3.0% 26 3.3% 11 1.7% 56 4.0%
Group-wide -9 -2 -8 8 29
EBITA 327 5.9% 317 5.9% 593 5.5% 589 5.5% 1,351 6.4%
Amortisation of intangible
assets
-1 -1 -1 -1 -2
Net financial income/expense -15 -13 -24 -35 -74
Profit/loss before tax (EBT) 312 303 568 553 1,274

NOTE 2. Segment reporting and revenue distribution, cont.

Distribution of revenues Apr–Jun 2021 Apr–Jun 2020
Revenue per category, SEK million Service Installation Total Service Installation Total
Sweden 1,480 1,640 3,119 1,428 1,534 2,961
Norway 570 416 987 498 550 1,048
Denmark 456 626 1,082 327 725 1,052
Finland 131 269 400 78 250 328
Eliminations -1 -17 -18 -1 -6 -7
Group 2,636 2,934 5,570 2,329 3,053 5,382
Distribution of revenues Jan–Jun 2021 Jan–Jun 2020
Revenue per category, SEK million Service Installation Total Service Installation Total
Sweden 2,909 3,050 5,959 2,832 2,936 5,768
Norway 1,122 847 1,968 1,098 1,165 2,262
Denmark 898 1,248 2,146 750 1,369 2,119
Finland 222 561 783 144 509 653
Eliminations -9 -44 -53 -4 -15 -19
Group 5,141 5,662 10,803 4,819 5,964 10,783
Average number of employees Jan–Jun
2021
Jan–Jun
2020
Jan–Dec
2020
Sweden 5,683 5,934 5,831
Norway 2,892 2,936 2,997
Denmark 2,366 2,269 2,315
Finland 714 704 666
Group-wide 108 97 98
Total 11,763 11,940 11,906

NOTE 3. Acquisition of operations

Bravida made the following acquisitions in the January–June period:

Acquired unit Country Technical area Type Date Percentage
of votes
Employees Estimated
annual
sales,
SEK million
Profire Sprinkler AB Sweden Sprinklers Company January 100% 35 70
J Beese VVS & Blik Denmark Heating and plumbing,
ventilation
Assets and
liabilities
February 12 14
Fiberkom ApS Denmark Electrical Company February 100% 8 8
SKM Service Oy Finland Heating and plumbing Company March 100% 20 133
Volt Elektro AS Norway Electrical Company April 100% 6 11
IEAB Installationsentreprenören AB Sweden HVAC Company May 100% 23 75
E3K Installation AB Sweden Automation, electrics,
heating and plumbing,
ventilation
Company May 100% 100 165
Runevads VVS Teknik AB Sweden Heating and plumbing,
ventilation
Company June 100% 30 50
Sundins El i Norrköping AB Sweden Electrical Company June 100% 24 48

NOTE 3. Acquisition of operations, cont.

Effects of acquisitions in 2021

Bravida normally uses an acquisition structure with a fixed purchase price and contingent consideration. The contingent consideration is initially valued at the likely final amount, which for the year's acquisitions is SEK 69 million. The contingent considerations are due for payment within three to five years. The acquisitions are reported in aggregate form in the table below as individually they are not of sufficient size to justify separate recognition of each acquisition.

The acquisition analyses of acquired companies in 2021 are preliminary.

Assets and liabilities included in
acquisition
Fair value recognised in the
Group, SEK million
Intangible assets 2
Property, plant and equipment 5
Trade receivables* 67
Income accrued but not invoiced 4
Other current assets 29
Cash and cash equivalents 69
Non-current liabilities -5
Trade payables -34
Income invoiced but not accrued -7
Other current liabilities -42
Net identifiable assets and liabilities 88
Consolidated goodwill 283
Consideration 371
Cash and cash equivalents, acquired 69
Net effect on cash and cash equivalents 302
Cash consideration paid 274
Consideration recognised as a liability** 97
Consideration 371

*There are no material impairments of trade receivables. **Of the total consideration recognised as a liability, SEK 69 million consists of contingent consideration.

Acquisitions after the end of the reporting period

Bravida has made one acquisition since the end of the period. In July, Dala Klimat was acquired in Sweden, with 4 employees and sales of approximately SEK 10 million.

NOTE 4. Seasonal variations

Bravida's business is affected by seasonal variations in the construction industry and employees' annual holiday. Bravida usually has a lower level of activity in the third quarter as it is the main holiday period. The fourth quarter normally has the highest earnings because many projects are completed during this period.

NOTE 5. Financial instruments, fair

value

The fair value of the Group's financial assets and liabilities is not materially different from carrying amounts. No items other than the contingent consideration are recognised at fair value in the balance sheet.

The Board and the Chief Executive Officer hereby confirm that the report gives a true and fair overview of the development of the parent company's and Group's activities, their financial position and earnings, and describes significant risks and uncertainties faced by the parent company and the companies included in the Group.

Stockholm, 16 July 2021 Bravida Holding AB

Fredrik Arp Chairman

Jan Johansson Board member

Karin Stålhandske Board member

Marie Nygren Board member Staffan Påhlsson Board member

Cecilia Daun Wennborg Board member

Mattias Johansson CEO and Group President

Jan Ericson Employee Representative

Geir Gjestad Employee Representative

Örnulf Thorsen Employee Representative

Information

This information is information that Bravida Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out below, at 7:30 a.m. CET on 16 July 2021.

This interim report has not been reviewed by Bravida's auditors. This report contains information and opinions on future prospects

For further information, please contact:

Mattias Johansson, President and CEO Email: [email protected] Telephone: +46 8 695 20 00

Åsa Neving, CFO Email: [email protected] Telephone: +46 8 695 22 87

for Bravida's business activities. The information is based on Group management's current expectations and estimates. Actual future outcomes may vary considerably from the forward-looking statements in this report, partly because of changes in economic, market and competitive conditions.

Financial reporting dates

Interim Report July–September 2021 26 October 2021
Interim report October–December 2021 15 February 2022
Interim Report January–March 2022 28 April 2022
Annual General Meeting 5 May 2022
Interim Report April–June 2022 15 July 2022

Financial definitions

Average number of employees

Calculated as the average number of employees during the year, taking account of the percentage of fulltime employment.

Return on equity

12-month rolling net profit/loss as a percentage of average equity.

EBITA*

Operating profit excluding amortisation and impairment of non-current intangible assets. EBITA is the key ratio and performance indicator that is used for internal operational monitoring. EBITA provides an overall view of profit generated by operating activities.

EBITA margin*

EBITA as a percentage of net sales.

EBITDA*

Earnings before interest, taxes, depreciation, and amortisation. EBITDA is a measure that the Group regards as relevant for investors who want to understand earnings generation before investments in non-current assets.

Effective tax rate

Recognised tax expense as a percentage of profit/loss before tax.

Equity per share, SEK

Equity attributable to equity holders of the parent company divided by the number of ordinary shares outstanding at period end.

Net financial income/expense

Total exchange differences on borrowing and cash and cash equivalents in foreign currency, other financial revenue and other finance costs.

Capital structure

(Net debt/EBITDA) Net debt divided by EBITDA excluding specific costs, based on a rolling 12-month calculation.

A healthy capital structure provides a solid basis for continued business operations. The capital structure should enable a high degree of financial flexibility and provide scope for acquisitions.

Cash flow from operating

activities per share Cash flow from operating activities for the period, divided by the number of shares at period end.

Cash conversion* (excluding IFRS 16 Leases)

Total 12-month EBITDA, change in working capital and investment in plant and equipment, as well as adjustment for non-cash items in EBITDA in relation to 12-month EBIT (operating profit).

This key ratio measures the percentage of profit that is converted into cash flow. The purpose is to analyse what percentage of earnings can be converted into cash and cash equivalents and, in the longer term, the opportunity for investments, acquisitions and dividends, with the exception of interest-related cash flows.

Net sales

Net sales are recognised in accordance with the principle of recognition over time, rather than using the previous percentage-of-completion method. These revenues are recognised in proportion to the degree of completion of projects.

Net debt*

Interest-bearing liabilities (including lease liabilities, excluding pension liabilities), less cash and cash equivalents. This key figure is a measure to show the Group's total interest-bearing debt.

Organic growth

The change in sales adjusted for currency effects, as well as acquisitions and disposals compared with the same period of the previous year. Sales from acquisitions and divestments are eliminated for a period of 12 months from the date of acquisition or divestment.

Operating cash flow*

Operating profit/loss adjusted for non-cash items, investments in machinery and equipment and changes in working capital.

Order intake

The value of new projects and contracts received, and changes in existing projects and contracts over the period in question. Includes both installation and service business.

Order backlog

The value of remaining, not yet accrued project revenues from orders on hand at the end of the period. Order backlog only includes installation projects, not service operations.

Diluted earnings per share

Profit/loss for the period attributable to shareholders of the parent company divided by the average number of outstanding ordinary shares after dilution.

Basic earnings per share

Profit/loss for the period attributable to owners of the parent company divided by the average number of outstanding ordinary shares.

Interest coverage ratio*

Profit/loss after financial items plus interest expense, divided by interest expense. This key ratio is a measure of how much earnings may fall by without interest payments being jeopardised or how much interest on borrowing may increase without operating profit turning negative.

Working capital*

Total current assets, excluding cash and cash equivalents, minus current liabilities excluding current provisions and interest-bearing short-term borrowing, and current lease liabilities. This measure shows how much working capital is tied up in the business and may be set in relation to sales to understand how efficiently tied-up working capital is being used.

Operating margin

Operating profit/loss as a percentage of net sales.

Operating profit/EBIT

Earnings net financial income/ expense and tax.

Equity/assets ratio

Equity including non-controlling interests as a percentage of total assets.

Specific costs

Transactions and items that are irregular in terms of occurrence and amount and thereby have an impact on earnings and ratios.

*See page 15 for reconciliation of performance measures.

Operational definitions

Installation/contracting

The installation and refurbishment of technical systems in properties, facilities and infrastructure.

Service

Operation and maintenance, as well as minor refurbishment of installations in buildings and facilities.

Electrical

Power supply, lighting, heating, control and surveillance systems. Telecom and other low-voltage installations. Fire and intruder alarm products and systems, access control systems, CCTV and integrated security systems.

HVAC (heating, ventilation and air conditioning)

Comfort ventilation and comfort cooling through air treatment, air conditioning and climate control. Commercial cooling in freezer and cold rooms. Process ventilation, control systems. Energy audits and energy efficiency work through heat recovery, heat pumps, etc.

Heating & Plumbing

Water, wastewater, heating, sanitation, cooling and sprinkler systems. District heating and cooling. Industrial piping with expertise in all types of pipe welding. Energy saving through integrated energy systems.

Other

Refers to other technical areas such as power, security, cooling, solar panels, energy optimisation, sprinklers and technical service management.

Other definitions

LTIR (Lost Time Incident Rate)

Occupational injuries that lead to at least one day of sickness absence per million working hours.

This is Bravida

Our mission

We offer technical end-to-end solutions over the life of a property, from consulting and project design to installation and service. We are a large company with local presence throughout the Nordics. We have a local presence for customers and take long-term responsibility for our work. Our employees are our most important asset. With shared values, working methods and tools, together we create sustainable and profitable business for us and our customers.

Our vision

Bravida enables customers to leverage the full potential of their buildings. Through service and installation, we bring buildings to life – leading the way towards a sustainable and resilient society.

Target

We manage our business according to a number of key goals that reflect our aims regarding sustainable growth, stability and leadership in the sector.

Bravida helps customers with the service and installation of technical functions in properties and industrial facilities. Our aim is for each service and installation project to make a property better and more energy efficient.

The Bravida Way

Bravida is a large company with a local presence throughout the Nordics. We operate as ONE company, drawing on the same culture, working methods and strategies. Together we provide the market's best customer experience.

➀ We have a local presence, but we are ONE company

We approach and interact with our customers on local markets. Bravida's group-wide corporate culture, working methods and strategy ensure each branch creates the market's best customer offering and a profitable business.

➁ Shared culture

Together, we are Bravida. Our entire company shares the same corporate culture, values and leadership.

➂ Shared working methods and tools

Bravida develops group-wide working methods and tools that all branches use to lead and enhance their business.

➃ Group-wide strategy

Our managers' most important task is to implement Bravida's strategy. Each branch is proactive in creating the best customer offering, the best team, efficient operations and a sustainable business.

Our vision is our ultimate objective, and our strategies help us get there. Our aim is to be the best in the Nordic region, the first choice for customers and the most attractive employer in the industry. To achieve this, we work actively to implement our strategies every day.

"We aim to be the best on a number of levels."

⊕ Best customer offering

Bravida has the best customer offering on the market. Our customers choose us because we create end-to-end solutions that make the complex simple. We listen to our customers and proactively suggest solutions for the entire life cycle of a property. We assist in making sustainable choices and creating sustainable solutions. We provide customers with feedback after completing assignments, and always ask if we can help with anything else. Above all, we keep our promises, we take responsibility for our work and care about our customers.

⊕ Sustainable business

We take responsibility for our business and take a proactive approach to long-term sustainability. We ultimately aim to eliminate all occupational injuries, and each branch works systematically to create a safe, pleasant work environment. We endeavour to achieve sustainable use of resources and a small carbon footprint. We set high standards for both our suppliers and ourselves on business ethics, legal requirements and human rights.

⊕ The best team

Bravida has the best team in the industry. What unites us is our drive to constantly improve. That is why the best managers and employees choose to work with us. We actively promote gender equality and diversity with a view to becoming a stronger company. We are passionate about service and are experts in project management and delivering assignments. We work as a team, we help each other out and we have fun together at work. In addition, we provide all kinds of opportunities to grow and develop at our company.

⊕ Efficient delivery

Bravida takes a highly professional approach to everything it does. All our employees do their utmost every day to provide a great customer experience. We are efficient, cost conscious and ensure our workplaces are well run. We always apply our group-wide working methods and ensure purchasing is carried out correctly. We also plan meticulously, monitor our productivity and have control over all aspects of our assignments.

⊕ Profitable growth: margin over volume

Margin over volume. Bravida constantly endeavours to improve profitability and achieve the full potential of each branch. We do this by ensuring we provide the best customer offering, the best team, efficient delivery of assignments and a sustainable business. We only take on assignments and projects with a good margin. We are cost conscious and use resources efficiently. We always use Bravida's group-wide resources and systems, and aim to achieve low fixed costs. Licence to grow. When a branch is profitable and has firm foundations in place, we focus on growth. We grow organically by developing our offering and by increasing our emphasis on sales and recruitment. We also grow through acquisitions. Our profitable branches and regions are always on the lookout for good local businesses, and we acquire companies that we would like to be part of our own business. Bravida also makes strategic acquisitions to establish itself on new markets or in new technical areas.

Bravida's objective is to be the largest or second-largest player in those places where we choose to operate.

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Headquarters

Bravida Holding AB Stockholm 126 81 Sweden Street address: Mikrofonvägen 28 Telephone: +46 8 695 20 00 www.bravida.com

Sweden

Bravida Sverige AB 126 81 Stockholm Sweden Street address: Mikrofonvägen 28 Telephone: +46 8 695 20 00 www.bravida.com

Norway

Bravida Norge AS Postboks 313 Økern 0511 Oslo Norway Street address: Østre Aker vei 90 Telephone: +47 2404 80 00 www.bravida.no

Denmark

Bravida Danmark A/S Park Allé 373 2605 Brøndby Denmark Telephone: +45 4322 1100 www.bravida.dk

Finland

Bravida Finland Oy Valimotie 21 00380 Helsinki Finland Telephone: +358 10 238 8000 www.bravida.fi

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