Interim / Quarterly Report • Jul 25, 2017
Interim / Quarterly Report
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| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
Jul 2016 –Jun 2017 |
|---|---|---|---|---|---|---|
| Net sales | 4,325 | 3,800 | 8,440 | 7,227 | 14,792 | 16,005 |
| Operating profit/loss | 253 | 227 | 461 | 401 | 944 | 1,004 |
| Operating margin, % | 5.8 | 6.0 | 5.5 | 5.6 | 6.4 | 6.3 |
| Adjusted operating profit/loss | 261 | 227 | 469 | 401 | 954 | 1,022 |
| Adjusted operating margin, % | 6.0 | 6.0 | 5.6 | 5.6 | 6.5 | 6.4 |
| Profit/loss after tax | 186 | 163 | 336 | 286 | 674 | 724 |
| Cash flow from operating activities | 150 | 57 | 531 | 70 | 428 | 890 |
| Operating cash flow | 177 | 92 | 612 | 149 | 594 | 1,057 |
| Interest coverage ratio | 26.6 | 15.6 | 20.3 | 13.6 | 15.5 | 18.5 |
| Cash conversion, % | 104 | 77 | 104 | 77 | 60 | 104 |
| Net debt/adjust. EBITDA, 12 m | 2.2 | 2.8 | 2.2 | 2.8 | 2.5 | 2.2 |
| Order intake | 4,937 | 4,515 | 9,408 | 7,985 | 15,990 | 17,298 |
| Order backlog | 10,493 | 7,972 | 10,493 | 7,972 | 8,644 | 10,493 |
In the second quarter, organic growth was positive in Sweden and Denmark, but was unchanged at Group level. Fewer working days in the quarter because of the timing of Easter had a 5-6 percent negative effect on organic growth, with the greatest impact occurring in Norway.
For the first six months of the year, organic growth was 6 percent and all countries except Finland reported organic growth. I'm pleased that growth is coming from both installation and service operations and that we are able to deliver organic growth in excess of our financial target of 5 percent.
Our order backlog, which only contains installation projects, continued to increase and it is continuing to generate stable growth. In the second quarter, the order backlog increased by almost SEK 1,500 million to SEK till 10,493 million, SEK 900 million of which comes from the two most recent acquisitions in Norway and Denmark.
The acquisition of Oras in Norway dilutes our margin in the short term. Adjusted for Oras, our operating margin increased by 0.3 percentage points in the second quarter. The acquisition of Oras will gradually contribute to higher operating profit and will strengthen the operating margin. Following two months as owner, our assumptions prior to the acquisition have been confirmed; Oras has stable underlying operations and there is significant potential for cost savings. Over the next few quarters, there will be a strong focus on improving profitability through measures regarding costs and purchasing, as well as through project selection and implementation of the Bravida Way.
Our cash flow from operating activities has improved considerably in recent quarters and has strengthened our balance sheet, which means we are meeting our financial targets on capital structure and cash conversion.
My assessment is that the market will remain good in Sweden and Norway, stable in Denmark and is improving in Finland. We are seeing good demand for our service operations and installation projects such as new-builds and upgrades of public buildings including hospitals, schools, apartment and office buildings and energy projects.
The lack of skilled labour in the construction industry is hampering our growth, however, and risks delaying the start of construction projects. We are managing the problem through careful project selection and increased recruitment and professional development resources.
Our order backlog has grown and is stable, and once again is at a record high. The order backlog contains lots of small and medium-sized orders and some large orders which, together with a growing service market, ensures stable sales and earnings performance over the coming quarters.
Mattias Johansson, Stockholm, July 2017
Net sales increased by 14 percent to SEK 4,325 million (3,800). Adjusted for currency fluctuations and acquisition, net sales were unchanged. Currency effects had a 2 percent positive impact on earnings and acquisitions improved net sales by 12 percent. Net sales rose in all countries. Sales increased in Sweden by 7 percent, in Norway by 39 percent, in Denmark by 13 percent and in Finland by 3 percent. Growth in Finland was due to the acquisition by Asentaja Group, carried out in December 2016, while in Norway growth was due to the acquisition of Oras in May and a positive currency translation effect.
Compared with the second quarter of 2016, installation business increased by 19 percent and service by 8 percent. Installation business accounted for 55 percent (52) of total net sales. The quarter contained a negative calendar effect compared with the same period last year, as the 2016 Easter weekend fell in the first quarter.
Order intake amounted to SEK 4,937 million (4,515), an increase of 9 percent. The order backlog at 30 June was 32 percent higher than at the same date last year and amounted to SEK 10,493 million (7,972), which is a new record for Bravida.
Net sales increased by 17 percent to SEK 8,440 million (7,227). Adjusted for currency fluctuations and acquisitions, net sales increased by 6 percent. Currency fluctuations improved earnings by 2 percent and acquisitions increased net sales by 9 percent. Net sales rose in all countries. In Sweden, net sales increased by 12 percent, in Norway by 38 percent, in Denmark by 14 percent and in Finland by 8 percent. Sweden, Norway and Denmark all showed organic growth.
Compared with the first half of 2016, installation business increased by 22 percent and service business by 11 percent. Installation business accounted for 54 percent (52) of total net sales. The increase in net sales in the installation business was mainly due to good growth in the order backlog reported since 2016.
The growth in service business is the result of the company's initiatives to boost service sales. Order intake amounted to SEK 9,408 million (7,985), an increase of 18 percent.
Operating profit increased by 12 percent to SEK 253 million (227), resulting in an operating margin of 5.8 percent (6.0). Operating profit in Sweden increased by 5 percent, in Norway by 18 percent and in Denmark by 40 percent. In Finland, operating profit improved to SEK 3 million (0). Group-wide operating profit was SEK 0 million (2). The acquisition of Oras in Norway and establishing the business in Finland has diluted the operating margin. The acquisition of Oras has diluted the operating margin by 0.3 percentage points and establishing the business in Finland has diluted it by 0.2 (0.3) percentage points.
Specific costs amounted to SEK 8 million (-) and related to costs attributable to the acquisition of Oras. Adjusted operating profit was SEK 261 million (227) and the adjusted operating margin was 6.0 percent (6.0).
Net financial items amounted to SEK -13 million (-16). Profit after financial items was SEK 239 million (211). Profit after tax was SEK 186 million (163). Basic and diluted earnings per share were SEK 0.92 (0.81).
Operating profit increased by 15 percent to SEK 461 million (401), resulting in an operating margin of 5.5 percent (5.6). Operating profit in Sweden increased by 3 percent, in Norway by 25 percent and in Denmark by 51 percent. In Finland, operating profit improved to SEK 3 million (-3). Group-wide operating profit was SEK 13 million (11). Establishing the business in Finland and the acquisition of Oras in Norway has diluted the operating margin by 0.2 (0.3) percentage points and 0.1 percentage points, respectively.
Specific costs amounted to SEK 8 million (-), which related to costs attributable to the acquisition of Oras. Adjusted operating profit was SEK 469 million (401) and the adjusted operating margin was 5.6 percent (5.6).
The change in the mix of net sales, with a higher percentage of installation business driven by a strong construction market, had a negative effect on the operating margin as the installation business generally has a slightly lower margin than the service business.
Net financial items amounted to SEK -28 million (-31). Profit after financial items was SEK 434 million (370). Profit after tax was SEK 336 million (286). Basic and diluted earnings per share were SEK 1.67 (1.42).
Depreciation and amortisation for the quarter was SEK 9 million (6). Depreciation and amortisation for January to June amounted to SEK 17 million (12).
The tax expense for the quarter was SEK -54 million (-48). Profit before tax was SEK 239 million (211). The effective tax rate for the quarter was 22 percent (23). The tax rate in Sweden is 22 percent, in Norway it is 24 percent, in Denmark 22 percent and in Finland 20 percent. Tax paid amounted to SEK 15 million (18).
The tax expense for January to June was SEK -98 million (-84). The effective tax rate was 22 (23) percent. Tax paid amounted to SEK 59 million (48).
April–June
Cash flow from operating activities was SEK 150 million (57). The improvement in cash flow was due to higher earnings and improved working capital. Working capital improved as a result of current liabilities increasing more than trade receivables. Cash flow from investment activities was SEK -174 million (-36), acquisitions of subsidiaries and businesses was SEK -172 million (-36). Cash flow from financing activities, which relates to dividends, was SEK -252 million.
Cash conversion on a 12-month basis was 104 percent, which was over Bravida's financial target.
Cash flow from operating activities was SEK 531 million (70). The improvement in cash flow was due to higher earnings and improved working capital. Working capital improved as a result of current liabilities increasing more than trade receivables. Cash flow from investment activities was SEK -188 million (-48), acquisitions of subsidiaries and businesses was SEK -181 million (-48). Cash flow from financing activities was SEK -252 million (-404).
Bravida Denmark completed the acquisition of JFE of 1 April. The acquired companies' sales, within district heating contracting, equate to SEK 130 million and the number of employees amount to 100 employees.
On 8 May Bravida Norway completed the acquisition of installation and service company Oras, with heating & plumbing and HVAC operations. Oras employs over 700 people and has annual sales equivalent to SEK 1,200 million. Acquisition costs of SEK 8 million impacted secondquarter earnings as specific costs.
Bravida's net debt at 30 June was SEK 2,343 million (2,577), which corresponds to a capital structure ratio of 2.2. Consolidated cash and cash equivalents were SEK 360 million (226) at 30 June. Interest-bearing liabilities amounted to SEK 2,703 million (2,803) at 30 June. Bravida's total credit facilities amounted to SEK 4,023 million (4,003), of which SEK 1,320 million (1,200) was unused at 30 June.
Equity amounted to SEK 4,116 million (3,543) at the end of the period. The equity/assets ratio was 32.3 percent (31.3).
The average number of employees at 30 June was 10,089 (9,302), an increase of 8 percent.
For the second quarter, revenues were SEK 38 million (45) and earnings after net financial items were SEK -12 million (11). For the January–June period, revenues were SEK 74 million (45) and earnings after net financial items were SEK -13 million (-10).
Bravida Holding AB's ordinary shares are listed on the Nasdaq Stockholm Large Cap list. At 30 June, Bravida had 12,283 shareholders. At 30 June, the four largest shareholders were; Swedbank Robur funds, Lannebo funds, the Fourth National Pension Insurance Fund (AP4) and Capital Group. Bravida has no shareholders that hold shares exceeding 10 percent of voting rights.
The price of Bravida shares at 30 June 2017 was SEK 61.55 (50.50), corresponding to a market capitalisation SEK 12,480 million (10,240) based on the number of shares issued. Over the past 12 months, Bravida shares produced a total shareholder return, including the dividend, of 24.4 percent.
Share capital amounts to SEK 4 mil-
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Net sales | 4,325 | 3,800 | 8,440 | 7,227 | 14,792 |
| Change | 525 | 140 | 1,213 | 242 | 587 |
| Change, % | 13.8 | 3.8 | 16.8 | 3.5 | 4.1 |
| Of which | |||||
| Organic growth, % | 0 | 0 | 6 | -1 | -1 |
| Acquisitions, % | 12 | 6 | 9 | 7 | 6 |
| Currency effects, % | 2 | -2 | 2 | -2 | -1 |
lion divided among 202,766,598 shares, of which 201,566,598 are ordinary shares and 1,200,000 are class C shares. 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.
On 1 April 2017, Bravida Sweden formed a new nationwide division for the areas of security, cooling, sprinklers, technical service management and power. The aim is to develop growth opportunities and synergies within these areas. The new division is headed up by former head of Special Division Sven Klockare, who is also a member of Group management.
On 6 April 2017, Johnny Hey Jensen, former head of Denmark Region North, was appointed the new Head of Division for Denmark. He is also a member of Bravida Group management.
As a result of Bravissima Holding AB (Bain Capital's investment funds) selling all its remaining shares in Bravida Holding AB, Bain Capital's representative Ivano Sessa stepped down from the Board of Bravida Holding AB on 12 June 2017.
The decisions taken by the Annual General Meeting of 10 May included the following: The dividend was set at SEK 1.25 per share, corresponding to a total payment of SEK 252 million. Monica Caneman, Jan Johansson, Ivano Sessa, Staffan Påhlsson, Cecilia Daun Wennborg and Mikael Norman were re-elected as Board members. Monica Caneman was re-elected as Chairwoman of the Board.
The Annual General Meeting adopted the Board's proposal for a new longterm incentive programme and authorised the Board to take decisions on issuing and repurchasing class C shares and transferring own ordinary shares. Of the 166 employees invited to participate in the incentive programme, 88 percent accepted.
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 fluctuations. Operating risks are related to day-to-day business operations such as tendering, price risks, capacity utilisation and revenue recognition. Management of these risks is part of Bravida's ongoing business process.
The percentage-of-completion method is applied and is based on the extent of completion of each project and the expected date of completion. A welldeveloped 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. These significant risks and uncertainties apply to both parent company and the consolidated Group.
No transactions with related parties outside the Group took place during the period.
There are no significant events to report.
Adjusted operating profit, rolling 12 months Cash flow from operating activities, rolling 12 months Adjusted operating margin, rolling 12 months
The construction industry is stable, with new-builds of apartment buildings as the main growth driver. Demand for newbuilds and upgrades of public-sector premises, offices and retail properties and building maintenance continues to be stable. Confidence indicators for the construction industry are at historical highs. Bravida believes demand for technical installations and service is strong in metropolitan regions and university towns and healthy in the rest of the country.
Net sales in Sweden increased by 7 percent to SEK 2,502 million (2,338). Growth is mainly attributable to the installation business, while the service business had slightly lower growth. Division Stockholm, which reported weak sales performance in 2016, is reporting significant organic growth in 2017.
Operating profit increased by 5 percent to SEK 162 million (155), resulting in an operating margin of 6.5 percent (6.6).
Net sales in Sweden increased by 12 percent to SEK 4,948 million (4,436). Growth in the order backlog resulted in increased pro-
Net sales by quarter, Sweden Net sales rolling 12 months, Sweden
Operating profit rolling 12 months, Sweden
duction of installation projects, and the service business also experienced good growth.
Operating profit increased by 3 percent to SEK 278 million (269), resulting in an operating margin of 5.6 percent (6.1). The decrease in the margin was due to a relatively higher share of income from the installation business, which generally has a slightly lower operating margin than the service business.
Order intake increased by 8 percent to SEK 3,027 million
(2,797). Bravida Sweden received a number of large orders concerning several hospitals and schools, a mining industry project and a cooling facility for baking products and a conference centre. The majority of the order intake, however, related to small and medium-sized installation projects and service assignments.
The order backlog at the end of the quarter was 24 percent higher than for the same period last year and amounted to SEK 5,539 million (4,463).
Order intake increased by 13 percent to SEK 5,543 million (4,900).
| Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|
| 2,502 | 2,338 | 4,948 | 4,436 | 8,760 |
| 574 | ||||
| 6.6 | ||||
| 9,566 | ||||
| 4,944 | ||||
| 5,376 | 5,198 | 5,376 | 5,198 | 5,330 |
| 162 6.5 3,027 5,539 |
155 6.6 2,797 4,463 |
278 5.6 5,543 5,539 |
269 6.1 4,900 4,463 |
The Karolinska Institute is using Bravida Fire & Security for the installation and maintenance of security and safety systems. In June, an agreement was signed concerning solutions for access control, intruder alarms, intercoms, locks and locking systems for the Karolinska Institute's Flemingsberg education and research campus. The agreement covers installation, service and maintenance. Bravida Fire & Security is also supplying solutions for the Karolinska Institute's cuttingedge Biomedicum laboratory facility in Solna.
The economy has been relatively weak in recent years. Investments in public-sector construction and infrastructure and housing, however, have resulted in a stable construction sector. Bravida believes demand for technical installations and service is strong around Oslo and in northern Norway and healthy in the rest of the country, except for the south-west of the country where overall demand remains weak.
Net sales increased by 39 percent to SEK 1,033 million (746). Most of the growth is due to acquisitions and a positive currency translation effect. The acquired company Oras has been consolidated from 8 May. Oras has net annual sales of approximately SEK 1,200 million.
Operating profit increased by 18 percent to SEK 56 million (47), resulting in an operating margin of 5.4 percent (6.3). The acquisition of Oras has resulted in a 1.0 percentage point dilution of the operating margin; adjusted for this, the operating margin was 6.4 percent (6.3). Fluctuations in exchange rates contributed to a positive translation effect of 4 percent on net sales and operating profit.
Work to integrate Oras is going to plan.
Net sales by quarter, Norway Net sales rolling 12 months, Norway
Operating profit by quarter, Norway Operating profit rolling 12 months, Norway
Net sales increased by 38 percent to SEK 1,938 million (1,402). The growth was due to acquisitions and organic growth in both the installation and service businesses and a 6 percent positive currency translation effect.
Operating profit increased by 25 percent to SEK 106 million (85), resulting in an operating margin of 5.5 percent (6.1). The acquisition of Oras has resulted in a 0.5 percentage point dilution of the operating margin; adjusted for this, the operating margin was 6.0 percent (6.1).
Order intake decreased by 8 percent to SEK 873 million (944). Order intake related to small and medium-sized installation projects and service assignments.
The order backlog at the end of the quarter was 68 percent higher than for the same period last year and amounted to SEK 2,724 million (1,619), SEK 875 million relates to the order backlog in Oras.
Order intake increased by 24 percent to SEK 2,147 million (1,726).
| Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|
| 1,033 | 746 | 1,938 | 1,402 | 3,124 |
| 56 | 47 | 106 | 85 | 224 |
| 5.4 | 6.3 | 5.5 | 6.1 | 7.2 |
| 873 | 944 | 2,147 | 1,726 | 3,507 |
| 2,724 | 1,619 | 2,724 | 1,619 | 1,677 |
| 2,409 | 2,182 | 2,409 | 2,182 | 2,349 |
Vitaminveien 11 is currently under construction in Storo, Oslo. The area will house a hotel, apartments, offices, cinema theatres, parking spaces and a preschool. Together, the new buildings will comprise an area of 62,000 square metres. Orders for all the heating & plumbing installations are worth NOK 70 million and Bravida is working with Rørtema AS to carry out the installations. The project is expected to be completed in 2019.
The construction industry is stable. The housing market has improved, which is contributing to increased demand for housing new-builds and upgrades. New-builds and the upgrade of public-sector buildings and housing are contributing to a stable market. Confidence indicators for the construction industry are slightly below normal levels. Bravida believes demand for technical installations and service assignments is healthy in major cities.
Net sales increased by 13 percent to SEK 621 million (550). Growth is mainly attributable to the installation business, while the service business had slightly lower growth.
Operating profit increased by 40 percent to SEK 31 million (22), resulting in an operating margin of 5.0 percent (4.0). The improved earnings are mainly due to an improvement in results for the Infrastructure division. Currency fluctuations had a positive 4 percent impact on net sales.
Net sales increased by 14 percent to SEK 1,211 million (1,060). The growth in sales was due to good growth in both the installation
Net sales by quarter, Denmark Net sales rolling 12 months, Denmark
Operating profit by quarter, Denmark Operating profit rolling 12 months, Denmark
and service businesses. Currency fluctuations had a positive 3 percent impact on net sales.
Operating profit increased by 51 percent to SEK 60 million (40), resulting in an operating margin of 5.0 percent (3.8). The improved earnings are due to an improvement in results in the Infrastructure division.
Order intake increased by 39 percent to SEK 854 million (615). Bravida Denmark received some large orders relating to projects such as a logistics and administration building for a data centre, a school and fuse- and power-related work on a section of railway. The majority of the order intake, however, related to small and medium-sized installation projects and service assignments.
The order backlog at the end of the quarter was 18 percent higher than for the same period last year and amounted to SEK 1,873 million (1,584).
Order intake increased by 24 percent to SEK 1,352 million (1,090).
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Net sales | 621 | 550 | 1,211 | 1,060 | 2,278 |
| Operating profit | 31 | 22 | 60 | 40 | 114 |
| Operating margin, % | 5.0 | 4.0 | 5.0 | 3.8 | 5.0 |
| Order intake | 854 | 615 | 1,352 | 1,090 | 2,412 |
| Order backlog | 1,873 | 1,584 | 1,873 | 1,584 | 1,689 |
| Average number of employees | 1,782 | 1,491 | 1,782 | 1,491 | 1,602 |
450 Coop stores in Southern Jutland, parts of Zealand and Funen are serviced by Bravida. Over the past year Coop has been trialling using Bravida for the service of their HVAC, cooling and CTS. Coop has now converted the trial period into a fixed service contract for a period of three years. A framework agreement has also been signed, providing a fixed price for maintenance and installation work. The framework also includes electrical and heating & plumbing work.
The construction sector has gradually improved over the past year and building firms are reporting increased sales and better order levels. Confidence indicators for the construction industry have improved. Bravida believes demand for technical installations and service is growing.
Net sales increased by 3 percent to SEK 177 million (171). The acquisition of Asentaja Group in December 2016 has contributed to the growth in net sales. Project selection has contributed to improving operating profit to SEK 3 million (0), resulting in an operating margin of 1.7 percent (-0.1).
Net sales increased by 8 percent to SEK 360 million (333). The low sales growth is due to project selection previously acquired businesses. Project selection has contributed to improving operating profit to SEK 3 million (-3), resulting in an operating margin of 1.0 percent (-1.0).
Integration of Asentaja Group is proceeding according to plan, and earnings were affected by integration costs.
Currency fluctuations had a positive 3 percent impact on net sales and operating profit.
Order intake increased by 16 percent to SEK 191 million (164). Order intake related to small and medium-sized installation projects and service assignments.
The order backlog at the end of the quarter was 16 percent higher than for the same period last year and amounted to SEK 357 million (307).
Order intake increased by 40 percent to SEK 384 million (273).
Net sales by quarter, Finland Net sales 12 months, Finland
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Net sales | 177 | 171 | 360 | 333 | 662 |
| Operating profit | 3 | 0 | 3 | -3 | 7 |
| Operating margin, % | 1.7 | -0.1 | 1.0 | -1.0 | 1.1 |
| Order intake | 191 | 164 | 384 | 273 | 538 |
| Order backlog | 357 | 307 | 357 | 307 | 334 |
| Average number of employees | 451 | 360 | 451 | 360 | 380 |
Pietarsaari City Hotel is being upgraded and Bravida is providing installation services. The hotel is Finland's oldest city hotel with around 100 rooms and three restaurants. The entire building is now being upgraded, along with all its technical facilities. The work is being carried out while the hotel continues to operate. Bravida is installing electrical, HVAC, cooling and fire alarm systems.
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan-Dec 2016 |
Jul 2016– Jun 2017 |
|---|---|---|---|---|---|---|
| Net sales | 4,325 | 3,800 | 8,440 | 7,227 | 14,792 | 16,005 |
| Production costs | -3,675 | -3,245 | -7,234 | -6,192 | -12,562 | -13,603 |
| Gross profit/loss | 649 | 555 | 1,206 | 1,034 | 2,230 | 2,402 |
| Selling and administrative expenses | -396 | -328 | -745 | -633 | -1,286 | -1,398 |
| Operating profit/loss | 253 | 227 | 461 | 401 | 944 | 1,004 |
| Net financial items | -13 | -16 | -28 | -31 | -67 | -63 |
| Profit/loss before tax | 239 | 211 | 434 | 370 | 877 | 941 |
| Tax on profit/loss for the period | -54 | -48 | -98 | -84 | -203 | -217 |
| Profit/loss for the period | 186 | 163 | 336 | 286 | 674 | 724 |
| Other comprehensive income | ||||||
| Items transferred or that can be transferred to profit or loss | ||||||
| Translation differences for the period from the translation of foreign operations | -14 | 22 | -25 | 43 | 92 | 24 |
| Items that cannot be transferred to profit or loss | ||||||
| Revaluation of defined-benefit pensions | -36 | -107 | -36 | -184 | -65 | 83 |
| Tax attributable to the revaluation of pensions | 8 | 24 | 8 | 41 | 14 | -34 |
| Other comprehensive income for the period | -42 | -61 | -54 | -100 | 42 | 72 |
| Comprehensive income for the period | 143 | 101 | 283 | 185 | 715 | 796 |
| Comprehensive income for the period attributable to: | ||||||
| Equity holders of the parent | 143 | 98 | 282 | 185 | 714 | 812 |
| Non-controlling interests | 0 | 3 | 0 | 0 | 1 | 0 |
| Comprehensive income for the period | 143 | 101 | 283 | 185 | 715 | 796 |
| Earnings per share for the period, SEK | 0.92 | 0.81 | 1.67 | 1.42 | 3.34 | 3.59 |
Number of ordinary shares in the parent company for all periods are 201,566,598.
| 7,780 | |||
|---|---|---|---|
| Goodwill | 7,276 | 7,599 | |
| Other non-current assets | 153 | 175 | 144 |
| Total non-current assets | 7,933 | 7,451 | 7,743 |
| Trade receivables | 2,698 | 2,222 | 2,544 |
| Income accrued but not invoiced | 1,127 | 1,027 | 875 |
| Other current assets | 614 | 388 | 514 |
| Cash and cash equivalents | 360 | 226 | 286 |
| Total current assets | 4,799 | 3,864 | 4,219 |
| Total assets | 12,732 | 11,314 | 11,962 |
| Equity attributable to holders of the parent | 4,107 | 3,534 | 4,067 |
| Equity attributable to non-controlling interests | 9 | 9 | 11 |
| Total equity | 4,116 | 3,543 | 4,079 |
| Other non-current liabilities | 3,036 | 3,000 | 2,945 |
| Total other non-current liabilities | 3,036 | 3,000 | 2,945 |
| Trade payables | 1,530 | 1,202 | 1,468 |
| Income invoiced but not accrued | 1,504 | 1,368 | 1,318 |
| Other current liabilities | 2,546 | 2,201 | 2,151 |
| Total current liabilities | 5,581 | 4,771 | 4,938 |
| Total liabilities | 8,617 | 7,772 | 7,883 |
| Total equity and liabilities | 12,732 | 11,314 | 11,962 |
| Of which interest-bearing liabilities | 2,703 | 2,803 | 2,703 |
| SEK MIL. | 30/06/17 | 30/06/16 | 31/12/16 |
|---|---|---|---|
| Consolidated equity | |||
| Opening balance | 4,079 | 3,555 | 3,555 |
| Comprehensive income for the period | 283 | 185 | 715 |
| Dividend | -252 | -202 | -202 |
| Cost shareholder programme | 6 | 4 | 10 |
| Closing balance | 4,116 | 3,543 | 4,079 |
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Cash flow from operating activities | |||||
| Profit/loss before tax | 239 | 211 | 434 | 370 | 877 |
| Adjustment for non-cash items | 12 | -12 | 17 | -23 | 50 |
| Income taxes paid | -15 | -18 | -59 | -48 | -112 |
| Changes in working capital | -87 | -124 | 140 | -229 | -387 |
| Cash flow from operating activities | 150 | 57 | 531 | 70 | 428 |
| Investing activities | |||||
| Acquisition of subsidiaries and businesses | -172 | -36 | -181 | -48 | -262 |
| Other | -2 | 1 | -7 | -1 | -18 |
| Cash flow from investing activities | -174 | -36 | -188 | -48 | -280 |
| Financing activities | |||||
| Repayment of loan | – | 0 | -500 | -200 | -302 |
| New loan | – | – | 500 | – | – |
| Change in utilisation of overdraft facility | 0 | -2 | 0 | -2 | 0 |
| Dividend paid | -252 | -202 | -252 | -202 | -202 |
| Cash flow from financing activities | -252 | -204 | -252 | -404 | -504 |
| Cash flow for the period | -276 | -182 | 91 | -382 | -356 |
| Cash and cash equivalents at start of year | 645 | 390 | 286 | 573 | 573 |
| Translation difference in cash and cash equivalents | -8 | 19 | -17 | 36 | 69 |
| Cash and cash equivalents at end of period | 360 | 226 | 360 | 226 | 286 |
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Operating profit/loss | 253 | 227 | 461 | 401 | 944 |
| Depreciation and amortisation | 9 | 6 | 17 | 12 | 26 |
| Other adjustments for non-cash items | 4 | -17 | 1 | -35 | 28 |
| Capital expenditure | -2 | 1 | -7 | -1 | -18 |
| Changes in working capital | -87 | -124 | 140 | -229 | -387 |
| Operating cash flow | 177 | 92 | 612 | 149 | 594 |
| SEK MIL. | Apr–Jun 2017 |
Apr–Jun 2016 |
Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|---|---|
| Net sales | 38 | 45 | 74 | 45 | 82 |
| Selling and administrative expenses | -44 | -29 | -70 | -45 | -83 |
| Operating profit/loss | -5 | 16 | 3 | 0 | -1 |
| Net financial items | -6 | -6 | -16 | -9 | -34 |
| Profit/loss after financial items | -12 | 11 | -13 | -10 | -34 |
| Net Group contribution | – | – | – | – | 644 |
| Transfer to/from untaxed reserves | – | – | – | – | -153 |
| Profit/loss before tax | -12 | 11 | -13 | -10 | 456 |
| Tax | – | – | – | – | -99 |
| Profit/loss for the period | -12 | 11 | -13 | -10 | 357 |
| SEK MIL. | 30/06/17 | 30/06/16 | 31/12/16 |
|---|---|---|---|
| Shares in subsidiaries | 7,341 | 7,341 | 7,341 |
| Total non-current assets | 7,341 | 7,341 | 7,341 |
| Receivables from Group companies | 2,495 | 2,071 | 1,755 |
| Current receivables | 120 | 86 | 51 |
| Total current receivables | 2,615 | 2,157 | 1,806 |
| Cash and bank balances | 272 | 151 | 184 |
| Total current assets | 2,887 | 2,307 | 1,990 |
| Total assets | 10,228 | 9,649 | 9,331 |
| Restricted equity | 4 | 4 | 4 |
| Non-restricted equity | 4,502 | 4,388 | 4,760 |
| Equity | 4,506 | 4,392 | 4,764 |
| Untaxed reserves | 231 | 78 | 231 |
| Liabilities to credit institutions | 2,700 | 2,700 | 2,700 |
| Total non-current liabilities | 2,700 | 2,700 | 2,700 |
| Short-term loans | – | 100 | – |
| Liabilities to Group companies | 2,624 | 2,264 | 1,496 |
| Other current liabilities | 167 | 115 | 140 |
| Total current liabilities | 2,791 | 2,479 | 1,636 |
| Total equity and liabilities | 10,228 | 9,649 | 9,331 |
| Of which interest-bearing liabilities | 2,700 | 2,800 | 2,700 |
| INCOME STATEMENT, SEK MIL. | Apr–Jun 2017 |
Jan–Mar 2017 |
Oct–Dec 2016 |
Jul–Sep 2016 |
Apr–Jun 2016 |
Jan–Mar 2016 |
Oct–Dec 2015 |
Jul–Sep 2015 |
|---|---|---|---|---|---|---|---|---|
| Net sales | 4,325 | 4,115 | 4,277 | 3,289 | 3,800 | 3,427 | 3,919 | 3,302 |
| Production costs | -3,675 | -3,558 | -3,547 | -2,822 | -3,245 | -2,948 | -3,272 | -2,821 |
| Gross profit/loss | 649 | 557 | 730 | 466 | 555 | 479 | 647 | 481 |
| Selling and administrative expenses | -396 | -348 | -377 | -277 | -328 | -305 | -372 | -312 |
| Operating profit/loss | 253 | 209 | 353 | 189 | 227 | 175 | 275 | 168 |
| Adjustments relating to specific costs | 8 | – | 0 | 11 | – | – | 33 | 27 |
| Adjusted operating profit/loss | 261 | 209 | 353 | 200 | 227 | 175 | 308 | 195 |
| Net financial items including revaluation of hedges | -13 | -14 | -18 | -17 | -16 | -15 | -202 | -32 |
| Profit/Loss after financial items | 239 | 194 | 335 | 172 | 211 | 159 | 74 | 136 |
| Tax on profit/loss for the period | -54 | -44 | -80 | -39 | -48 | -36 | -18 | -28 |
| Profit/loss for the period | 186 | 151 | 255 | 133 | 163 | 123 | 56 | 109 |
| BALANCE SHEET, SEK MIL. | 30/06/17 | 31/03/17 | 31/03/17 | 31/12/16 | 30/09/16 | 30/06/16 | 31/03/16 | 31/12/15 |
|---|---|---|---|---|---|---|---|---|
| Goodwill | 7,780 | 7,593 | 7,599 | 7,508 | 7,276 | 7,239 | 7,211 | 7,185 |
| Other non-current assets | 153 | 145 | 144 | 204 | 175 | 141 | 219 | 313 |
| Current assets | 4,439 | 3,890 | 3,933 | 3,813 | 3,638 | 3,521 | 3,395 | 3,536 |
| Cash and cash equivalents | 360 | 645 | 286 | 220 | 226 | 390 | 573 | 408 |
| Total assets | 12,732 | 12,272 | 11,962 | 11,745 | 11,314 | 11,290 | 11,396 | 11,443 |
| Equity | 4,116 | 4,221 | 4,079 | 3,619 | 3,543 | 3,640 | 3,555 | 3,306 |
| Borrowings | 2,700 | 2,700 | 2,700 | 2,700 | 2,700 | 2,700 | 2,700 | 3,420 |
| Other non-current liabilities | 336 | 258 | 245 | 475 | 300 | 174 | 177 | 330 |
| Current liabilities | 5,581 | 5,093 | 4,938 | 4,951 | 4,771 | 4,776 | 4,964 | 4,387 |
| Total equity and liabilities | 12,732 | 12,272 | 11,962 | 11,745 | 11,314 | 11,290 | 11,396 | 11,443 |
| CASH FLOW, SEK MIL. | Apr–Jun 2017 |
Jan–Mar 2017 |
Oct–Dec 2016 |
Jul–Sep 2016 |
Apr–Jun 2016 |
Jan–Mar 2016 |
Oct–Dec 2015 |
Jul–Sep 2015 |
|---|---|---|---|---|---|---|---|---|
| Cash flow from operating activities | 150 | 381 | 415 | -57 | 57 | 13 | 694 | -201 |
| Cash flow from investing activities | -174 | -14 | -49 | -183 | -36 | -13 | -58 | -95 |
| Cash flow from financing activities | -252 | 0 | -300 | 200 | -204 | -200 | -431 | -1 |
| Cash flow for the period | -276 | 367 | 66 | -40 | -182 | -200 | 205 | -296 |
| OPERATIONS | TECHNICAL AREAS | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Service | Installation | Electrical | Heating & Plumbing |
HVAC | Other areas | ||||
| Sweden | 46% | 54% | 45% | 30% | 18% | 7% | |||
| Norway | 50% | 50% | 64% | 27% | 3% | 6% | |||
| Denmark | 46% | 54% | 56% | 26% | 17% | 0% | |||
| Finland | 20% | 80% | 38% | 28% | 22% | 11% | |||
| The Group | 46% | 54% | 51% | 29% | 14% | 6% |
| KEY FIGURES | Apr–Jun 2017 |
Jan–Mar 2017 |
Oct–Dec 2016 |
Jul–Sep 2016 |
Apr–Jun 2016 |
Jan–Mar 2016 |
Oct–Dec 2015 |
Jul–Sep 2015 |
|---|---|---|---|---|---|---|---|---|
| Operating margin, % | 5.8 | 5.1 | 8.3 | 5.8 | 6.0 | 5.1 | 7.0 | 5.1 |
| Adjusted operating margin, % | 6.0 | 5.1 | 8.3 | 6.1 | 6.0 | 5.1 | 7.9 | 5.9 |
| Profit margin, % | 5.5 | 4.7 | 7.8 | 5.2 | 5.5 | 4.6 | 1.9 | 4.1 |
| Return on equity,* % | 17.4 | 16.9 | 17.5 | 13.3 | 12.5 | 9.7 | 8.4 | 12.1 |
| Net debt | 2,343 | 2,058 | 2,417 | 2,783 | 2,577 | 2,416 | 2,433 | 2,972 |
| Net debt/adjust. EBITDA* | 2.2 | 2.0 | 2.5 | 3.0 | 2.8 | 2.7 | 2.7 | 3.4 |
| Cash conversion,* % | 104 | 98.0 | 60 | 91 | 77 | 85 | 125 | 116 |
| Interest coverage ratio | 26.6 | 15.9 | 21.6 | 12.5 | 15.6 | 11.7 | 4.3 | 2.7 |
| Equity/assets ratio, % | 32.3 | 34.4 | 34.1 | 30.8 | 31.3 | 32.2 | 31.2 | 28.9 |
| Order intake | 4,937 | 4,471 | 4,313 | 3,693 | 4,515 | 3,469 | 3,886 | 3,458 |
| Order backlog | 10,493 | 9,000 | 8,644 | 8,475 | 7,972 | 7,135 | 7,092 | 7,099 |
| Average no. of employees | 10,089 | 9,835 | 9,730 | 9,469 | 9,302 | 9,419 | 9,359 | 9,374 |
| Administration costs as % of sales | 9.2 | 8.5 | 8.8 | 8.4 | 8.6 | 8.9 | 9.5 | 9.5 |
| Working capital as % of sales** | -6.2 | -6.9 | -5.8 | -4.9 | -6.3 | -7.2 | -7.9 | -5.7 |
| Earnings per share for the period, SEK*** | 0.92 | 0.75 | 1.26 | 0.66 | 0.81 | 0.61 | 0.28 | 0.54 |
| Equity per share, SEK*** | 20.42 | 20.94 | 20.24 | 17.96 | 17.58 | 18.06 | 17.64 | 16.40 |
| Cash flow from operating activities per share, SEK*** | 0.74 | 1.89 | 2.06 | -0.28 | 0.28 | 0.06 | 3.44 | -1.00 |
| Share price at balance sheet date, SEK | 61.55 | 58.10 | 55.25 | 57.00 | 50.50 | 59.75 | 55.50 | – |
*Calculated on rolling 12-month earnings.
**Calculated on rolling 12-month sales.
***In the third quarter of 2015, a reverse 1:2 split of the company's shares was carried out, following which there are 201,566,598 shares. Earnings per share from previous periods have been restated in this interim report.
The company presents certain financial measures in the interim report that are not defined under IFRS. The company believes these measures provide valuable additional information for investors and the company's management as they allow relevant trends to be assessed. Bravida's definitions of these measures may differ from other companies' definitions of the same terms. These financial measures should be regarded as complementary rather than replacing the measures defined under IFRS. Below are definitions of measures not defined under IFRS and not mentioned elsewhere in the interim report. These measures are reconciled in the tables below. Calculations do not always tally because amounts in the table below have been rounded to the nearest million Swedish kronor. For definitions of key figures, see page 20.
| RECONCILIATION OF KEY FIGURES, NOT DEFINED UNDER IFRS | Apr–Jun 2017 |
Jan–Mar 2017 |
Oct–Dec 2016 |
Jul–Sep 2016 |
Apr–Jun 2016 |
Jan–Mar 2016 |
Oct–Dec 2015 |
Jul–Sep 2015 |
|---|---|---|---|---|---|---|---|---|
| Net debt | ||||||||
| Interest-bearing liabilities | 2,703 | 2,703 | 2,703 | 3,003 | 2,803 | 2,805 | 3,005 | 3,380 |
| Cash and cash equivalents | -360 | -645 | -286 | -220 | -226 | -390 | -573 | -408 |
| Total net debt | 2,343 | 2,058 | 2,417 | 2,783 | 2,577 | 2,416 | 2,433 | 2,972 |
| EBITDA | ||||||||
| Operating profit/loss | 253 | 209 | 353 | 189 | 227 | 175 | 275 | 168 |
| Depreciation, amortisation and impairment losses | 9 | 8 | 7 | 6 | 6 | 6 | 6 | 5 |
| EBITDA | 262 | 217 | 360 | 196 | 233 | 181 | 281 | 174 |
| Working capital | ||||||||
| Current assets | 4,799 | 4,534 | 4,219 | 4,033 | 3,864 | 3,911 | 3,967 | 3,891 |
| Cash and cash equivalents | -360 | -645 | -286 | -220 | -226 | -390 | -573 | -408 |
| Current liabilities | -5,581 | -5,093 | -4,938 | -4,951 | -4,771 | -4,776 | -4,964 | -4,389 |
| Current loans | 3 | 3 | 3 | 303 | 103 | 105 | 305 | 3 |
| Provisions | 143 | 137 | 143 | 130 | 115 | 117 | 141 | 120 |
| Total working capital | -996 | -1,064 | -859 | -705 | -916 | -1,032 | -1,124 | -784 |
| Interest coverage ratio | ||||||||
| Profit/loss before tax | 239 | 194 | 335 | 172 | 211 | 159 | 74 | 136 |
| Interest expense | 9 | 13 | 16 | 15 | 14 | 15 | 22 | 81 |
| Total | 249 | 207 | 351 | 187 | 225 | 174 | 96 | 217 |
| Interest expense | 9 | 13 | 16 | 15 | 14 | 15 | 22 | 81 |
| Interest coverage ratio | 26.6 | 15,9 | 21.6 | 12.5 | 15.6 | 11.7 | 4.3 | 2.7 |
| Cash conversion | ||||||||
| Operating profit/loss before depreciation, amortisation and impairment | ||||||||
| losses, past 12 months | 1,035 | 1,006 | 970 | 891 | 868 | 827 | 804 | 775 |
| Non-cash provisions in working capital, last 12 months | 55 | 28 | -1 | 54 | 39 | 51 | 60 | 25 |
| Change in working capital, last 12 months | -18 | -54 | -379 | -122 | -226 | -158 | 150 | 86 |
| Investments in machinery and equipment, last 12 months | -27 | -22 | -21 | -32 | -31 | -32 | -34 | -11 |
| Total | 1,045 | 958 | 569 | 791 | 650 | 688 | 979 | 875 |
| Operating profit/loss, last 12 months | 1,004 | 978 | 948 | 866 | 847 | 805 | 782 | 756 |
| Cash conversion, last 12 months, % | 107 | 98 | 60 | 91 | 77 | 85 | 125 | 116 |
| Specific costs | ||||||||
| Operating profit/loss | 253 | 209 | 353 | 189 | 227 | 175 | 275 | 168 |
| Adjustments relating to specific costs * | 8 | - | 0 | 11 | - | - | 33 | 27 |
| Adjusted operating profit/loss | 261 | 209 | 353 | 200 | 227 | 175 | 308 | 195 |
* See note 3.
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 IAS 34 Interim Reporting and appropriate sections of Chapter 9, Interim Reporting, of the Swedish Annual Accounts Act. The parts of the interim report that
relate to the parent company have been prepared in accordance with Section 9, Interim Reporting, of the Swedish Annual Accounts Act.
This report has been prepared in accordance with the same accounting policies and calculation methods as the 2016 Annual Report.
Amounts in the Group's financial reports are in Swedish kronor (SEK MIL) unless otherwise noted. Rounding differences may occur.
Geographic markets constitute Bravida's operating segments. The Group's geographic markets comprise the countries; Sweden, Norway, Denmark and Finland.
| NET SALES BY COUNTRY | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK MIL. | Apr–Jun 2017 |
Break down |
Apr–Jun 2016 |
Break down |
Jan–Jun 2017 |
Break down |
Jan–Jun 2016 |
Break down |
Jan–Dec 2016 |
Break down |
| Sweden | 2,502 | 58% | 2,338 | 62% | 4,948 | 59% | 4,436 | 61% | 8,760 | 59% |
| Norway | 1,033 | 24% | 746 | 20% | 1,938 | 23% | 1,402 | 19% | 3,124 | 21% |
| Denmark | 621 | 14% | 550 | 14% | 1,211 | 14% | 1,060 | 15% | 2,278 | 15% |
| Finland* | 177 | 4% | 171 | 4% | 360 | 4% | 333 | 5% | 662 | 4% |
| Group-wide and eliminations | -8 | -5 | -18 | -5 | -32 | |||||
| Total | 4,324 | 3,800 | 8,440 | 7,227 | 14,792 |
| SEK MIL. | Apr–Jun 2017 |
Operating margin |
Apr–Jun 2016 |
Operating margin |
Jan–Jun 2017 |
Operating margin |
Jan–Jun 2016 |
Operating margin |
Jan–Dec 2016 |
Operating margin |
|---|---|---|---|---|---|---|---|---|---|---|
| Sweden | 162 | 6.5% | 155 | 6.6% | 278 | 5.6% | 269 | 6.1% | 574 | 6.6% |
| Norway | 56 | 5.4% | 47 | 6.3% | 106 | 5.5% | 85 | 6.1% | 224 | 7.2% |
| Denmark | 31 | 5.0% | 22 | 4.0% | 60 | 5.0% | 40 | 3.8% | 114 | 5.0% |
| Finland | 3 | 1.7% | 0 | -0.1% | 3 | 1.0% | -3 | -1.0% | 7 | 1.1% |
| Group and eliminations | 0 | 2 | 13 | 11 | 25 | |||||
| Total | 253 | 5.8% | 227 | 6.0% | 461 | 5.5% | 401 | 5.6% | 944 | 6.4% |
| Adjustments (specific costs)* | 8 | – | 8 | – | 10 | |||||
| Adjusted operating profit/loss | 261 | 6.0% | 227 | 6.0% | 469 | 5.6% | 401 | 5.6% | 954 | 6.5% |
| Net financial items | -13 | -16 | -28 | -31 | -67 | |||||
| Profit/loss before tax | 239 | 211 | 434 | 370 | 877 |
| AVERAGE NUMBER OF EMPLOYEES | Jan–Jun 2017 |
Jan–Jun 2016 |
Jan–Dec 2016 |
|---|---|---|---|
| Sweden | 5,376 | 5,198 | 5,330 |
| Norway | 2,409 | 2,182 | 2,349 |
| Denmark | 1,782 | 1,491 | 1,602 |
| Finland | 451 | 360 | 380 |
| Group and eliminations | 72 | 71 | 70 |
| Total | 10,089 | 9,302 | 9,730 |
*Specific costs have only had an effect on Group-wide operations, not the other segments.
Specific costs are costs that are limited in time and relate mainly to improvement programmes, acquisition costs and the IPO. In the second quarter of 2017 these costs were related to the acquisition of Oras. In the third quarter of 2016 these mainly related to the costs for the final settlement of a dispute. See also the table on page 16 for adjusted operating profit.
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 higher earnings which is explained by many projects being completed during this period.
Bravida made the following acquisitions during the period January to June 2017:
| Acquired unit | Country | Type | Month of acquisition |
Percentage of votes |
No. of employees |
Estimated annual sales in SEK MIL. |
|---|---|---|---|---|---|---|
| Electrical business, Oslo* | Norway | Company | February | 9% | ||
| Plumbing business, Denmark | Denmark | Company | April | 100% | 100 | 130 |
| Plumbing & HVAC business, Norway | Norway | Company | May | 100% | 700 | 1,200 |
*Acquisition of non-controlling interests.
On 8 May 2017 Bravida, via Bravida Norge AS, acquired 100 percent of the share capital in Norwegian installation and service company Oras AS. The acquisition of Oras, Norway's leading heating & plumbing and HVAC provider, makes Bravida the market-leading end-to-end provider of installation and service on the Norwegian market. Oras has annual sales of approximately SEK 1,200 million, around 700 employees, with headquarters in Oslo, and has a presence throughout Norway in areas where Bravida already operates. The acquisition provides for synergy effects, primarily in purchasing and central costs. The purchase price for the shares was SEK 121 million, with the purchase price being paid in the second quarter of 2017. Oras had net debt of SEK 7 million at the acquisition date. Oras was consolidated into the Group from 8 May 2017. Earnings for the second quarter of 2017 were impacted by acquisition costs of SEK 8 million as a specific cost.
The acquisition analysis for Oras AS below is preliminary.
| Acquired net debt and goodwill | SEK MIL. |
|---|---|
| Purchase price | 121 |
| Fair value of acquired net debt | 7 |
| Goodwill | 129 |
Acquisitions have the following effects on consolidated assets and liabilities.
| Assets and liabilities included in acquisition, SEK MIL. | Oras AS | Other | Total |
|---|---|---|---|
| Intangible assets | 13 | 0 | 13 |
| Property, plant and equipment | 8 | 7 | 15 |
| Trade receivables * | 209 | 26 | 236 |
| Income accrued but not invoiced | 75 | 3 | 78 |
| Other current assets | 44 | 5 | 49 |
| Cash and cash equivalents | 0 | 1 | 1 |
| Long-term liabilities | -10 | -15 | -26 |
| Trade payables | -102 | -11 | -113 |
| Income invoiced but not accrued | -49 | 0 | -49 |
| Other current liabilities | -196 | -15 | -211 |
| Sum net identifiable assets and liabilities | -7 | 0 | -7 |
| Consolidated goodwill | 129 | 53 | 181 |
| Aquisition price | 121 | 55 | 176 |
| Cash and cash equivalents (acquired) | 0 | 1 | 1 |
| Net effect on cash and cash equivalents | 121 | 54 | 175 |
| Purchase price paid in cash | 121 | 33 | 154 |
| Consideration recognised as a liability | 0 | 22 | 22 |
| Aquisition price | 121 | 55 | 176 |
*No significant write-downs of trade receivables exist
The Board of Directors and Chief Executive Officer warrant that the report gives a true and fair overview of the operations, financial position and results of the Group and parent company, and describes significant risks and uncertainties faced by the parent company and the companies included in the Group.
Stockholm, 25 July 2017 Bravida Holding AB
Monica Caneman Chairman
Jan Johansson Director
Cecilia Daun Wennborg Director
Mikael Norman Director
Staffan Påhlsson Director
Mattias Johansson CEO and Group President
Jan Ericson Employee representative
Geir Gjestad Employee representative
Anders Mårtensson Employee representative
Örnulf Thorsen Employee representative
This interim report has not been reviewed by Bravida's auditors. 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 13:00 CET on 25 July 2017.
Mattias Johansson, President and CEO E-mail: [email protected] Telephone: +46 8 695 20 00
Nils-Johan Andersson, CFO E-mail: [email protected]
Telephone: +46 70 668 50 75
This report contains information and opinions on future prospects 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.
| 10 November 2017 |
|---|
| 16 February 2018 |
Calculated as the average number of employees during the year, taking account of the percentage of full-time employment.
12-month rolling net profit/loss as a percentage of average equity.
Recognised tax expense as a percentage of profit/loss before tax.
Equity attributable to equity holders of the parent company divided by the number of ordinary shares outstanding at period end.
Total exchange differences on borrowing and cash and cash equivalents in foreign currency, other financial revenue and other finance costs.
Operating profit/loss excluding specific costs as a percentage of net sales. The adjusted operating margin excludes the effect of specific costs, which improves the ability to make comparisons over time by excluding items that are irregular in frequency or size.
Operating profit/loss adjusted for specific costs. Adjusted operating profit/loss improves the ability to make comparisons over time by excluding items that are irregular in frequency or size.
ACTIVITIES PER SHARE Cash flow from operating activities for the period, divided by the number of shares at period end.
12-month EBITDA (operating profit/ loss plus depreciation and amortisation) +/-change in working capital and investment in machinery and equipment in relation to 12-month EBIT (operating profit/loss).
This key figure 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 are recognised in accordance with the principle of percentage-ofcompletion method. These revenues are recognised in proportion to the degree of completion of projects.
Average net debt divided by EBITDA excluding specific costs, based on a rolling 12-month calculation.
Interest-bearing liabilities, excluding pension liabilities, less cash and cash equivalents. This key figure is a measure to show the Group's total interest-bearing debt.
The change in sales adjusted for currency effects, as well as acquisitions and disposals compared with the same period of the previous year.
Operating profit/loss adjusted for noncash items, investments in machinery and equipment and changes in working capital.
The value of projects received and changes to existing projects during the period in question.
The value of remaining, not yet accrued project revenues from orders on hand at the end of the period. Order backlog does not include service operations, only installation projects.
Earnings for the period in relation to the average number of shares in the period.
Profit/loss after financial items plus interest expense, divided by interest expense. This key figure 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.
Total current assets, excluding cash and cash equivalents, minus current liabilities excluding current provisions and borrowing. 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 profit/loss as a percentage of net sales.
Installation/contracting The installation and refurbishment of technical systems in properties, facilities and infrastructure.
Operation and maintenance, as well as minor refurbishment of installations in buildings and facilities.
Power supply, lighting, heating, automatic control and surveillance systems. Telecom and other lowvoltage installations. Fire and intruder alarm products and systems, access control systems, CCTV and integrated security systems.
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 through heat recovery ventilation, heat pumps, etc.
Earnings before financial items and taxes.
Operating profit/loss before scheduled depreciation, amortisation and impairment losses. EBITDA is a measure that the Group regards as relevant for investors who want to understand earnings generation before investments in non-current assets.
Equity including non-controlling interests as a percentage of total assets.
Transactions and items that are irregular in occurrence and size and consequently have an impact on earnings and key figures.
Operating profit/loss adjusted for the impact on earnings from Oras and specific costs expressed as a percentage of net sales.
Operating profit/loss adjusted for the impact on earnings from Oras and specific costs.
Profit/loss after financial items, as a percentage of net sales.
Water, waste water, 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.
Principally relates to technical solutions and products for security, cooling, sprinklers, technical service management and power.
Bravida brings buildings to life – 24 hours a day, 365 days a year. We work primarily with electricity, heating & plumbing, and HVAC, but we also offer services in security, sprinklers, cooling, power and technical service management.
After every installation or service assignment we want properties and systems to work a little better, be more energy-efficient and for those people that live or work there to feel safe and healthy. In other words, we bring buildings to life.
We offer installation and service of electrical, heating & plumbing and HVAC systems.
Our skills and efficiency add value and benefit for our customers on a daily basis.
We combine a local presence with the resources of a large company.
Our vision is to be the leading partner in the Nordics for efficient technical solutions in installation and service. Our comprehensive knowledge will increase our customers' competitiveness.
We manage our business according to a number of key goals that reflect our aims regarding growth, stability and leadership in the sector.
Our corporate culture and way of working make us unique in the market. Bravida's business model is built from entrepreneurship, follow-up and support, and continuous improvement.
Bravida's approach is based on an important principle: our local branches are at the heart of the business. Each Bravida branch knows its local customers best. So each branch is responsible for taking decisions regarding its local market. It's the commitment of the local branches and employees that drive the company forward.
But there are also advantages in being a large company. Together we have created working practices, templates and systems to provide support, follow up and help local branches move forward. Our central Group departments like financial management, legal services, purchasing and HR help create economies of scale and support local branches.
We want to constantly improve and simplify the way we operate. Our motto is 'same needs – same solution'. Our Group-wide working model designed to create constant improvement helps local branches continually share experiences and learn from each other.
Bravida's objective is to be the largest or second-largest player in all the locations where we choose to operate. We aim to grow both organically and via acquisitions in our various key geographical markets. To ensure long-term stable growth, we are increasing our focus on service and proactive sales.
Focus on growth in service and proactive sales Recurring business reduces our cyclicality. Combining installation and service provides longer-term business.
Focus on end-to-end solutions and packaged solutions Greater cooperation between branches
Acquisitions should contribute at least one of the following:
Maintaining good financial stability is essential to Bravida. Margin always takes precedence over volume in our operations, with cost effectiveness being a corner stone of our business and we continually endeavour to maintain stable cash flow.
Long-term efforts to maintain strong cash flow and a healthy capital structure.
Continual monitoring of cash flow at all levels of the company.
Growth, but not at any price. We only take on assignments with a healthy margin and calculable risks.
Continual financial monitoring at all levels of the company.
Bravida aims to operate a responsible business and manage its own and others' resources efficiently. We take focussed measures to achieve clear results in our sustainability work.
– efficient production and energy-efficient offerings
Greater efficiency in our own operations and resource usage
Cooperation with customers to reduce energy and resource consumption in their properties and facilities
Sustainability impact assessment of installation GOOD BUSINESS ETHICS
– employee safety, and physical and mental health Active health and safety work
Focus on leadership
– in relation to customers, employees and suppliers
Active measures to maintain a healthy corporate culture with positive values Continual sustainability assessment of suppliers
Bravida Holding AB 126 81 Stockholm Sweden Street address: Mikrofonvägen 28 Telephone: +46 8 695 20 00 www.bravida.se
Bravida Norge AS Postboks 313 Økern 0511 Oslo Norway Street address: Østre Aker vei 90 Telephone: +47 2404 80 00 www.bravida.no
Bravida Danmark A/S Park Allé 373 2605 Brøndby Denmark Telephone: +45 4322 1100 www.bravida.dk
Bravida Finland Oy Ajomiehentie 1 00390 Helsinki Finland Telephone: +358 9 751 6060 www.bravida.fi
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