Earnings Release • May 11, 2016
Earnings Release
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This is a strong result. We are integrating Grontmij and capturing synergies while also improving the billing ratio throughout the group. Synergies and increased billing ratio contributed with approximately SEK 76 million to EBITA, compared with last year's pro-forma. At the same time, we are facing significant head-wind in the quarter due to negative calendar effects with 10 fewer working hours. This is negatively impacting EBITA with SEK 78 million compared to last year's pro forma. Still we are able to essentially offset the negative calendar effect through synergies and increased billing ratio.
Sweco is the leading engineering and architecture consultancy in Europe since the acquisition of Grontmij on 1 October 2015. The integration is progressing well and in several areas faster than the original plan. The rebranding has been completed and all former Grontmij-countries are operating under the Sweco name. We remain confident that we will achieve the financial targets communicated at the announcement of the acquisition.
During the quarter we acquired Ludes, a German architecture and project management consultancy with around 100 employees. The acquisition is in line with Sweco's strategy of leveraging our new footprint in Northern Europe for bolt-on acquisitions, similar to the model we have successfully applied in the Nordic market.
Overall, the market for Sweco's services is good and the development is stable. The situation varies between markets. The Swedish market is strong, while the Norwegian market is good but has weakened. The markets in Denmark, Western Europe and Central Europe are in general good and are developing positively. The markets in Finland and in the Netherlands remain challenging.
Sweco plans and designs tomorrow's communities and cities. Our work produces sustainable buildings, efficient infrastructure and access to electricity and clean water. With 14,500 employees in Europe, we offer our customer for publication on 11 May 2016 at 07:20 CET
The pro forma reporting facilitates analysis of developments in operational activities on a like-for-like basis, assuming that Grontmij had been part of Sweco since the beginning of 2015.
Net sales were essentially unchanged at SEK 4,018 million (4,024 million).
Synergies from the Grontmii integration contributed approximately SEK 37 million to EBITA and included reduced costs for shared IT and head office functions, reduced costs for overhead in Sweden as well as operational improvements in Denmark and the Netherlands.
The billing ratio increased 1.3 percentage points to 74.5 per cent (73.2). Approximately 0.9 percentage points of the improvement comes from increased internal efficiency throughout the group. The remainder is attributable to realized synergies, predominantly through reductions in administrative staff.
The positive effect of synergies and increased billing ratio contributed SEK 76 million to EBITA. Since the Easter holiday was during the first quarter in 2016, as opposed to the second quarter as in 2015, there were 10 fewer working hours compared with last year. This had a negative impact on profit and net sales of approximately SEK 78 million. Consequently, increased internal efficiency essentially offset the negative calendar effect.
4 of 7 Business Areas increased EBITA compared with last year. EBITA totalled SEK 263 million (258), excluding extraordinary costs for the Grontmij acquisition.
Net sales increased 63 per cent to SEK 4.018 million (2,465). Acquisition-based growth was 64 per cent and is almost exclusively attributable to the Grontmij acquisition.
As of 1 January, Grontmij Sweden is fully integrated with Sweco Sweden. Due to the new organisation, Grontmij's contribution to sales and earnings cannot be reported separately.
EBITA, adjusted for extraordinary costs, increased to SEK 263 million (229).
Extraordinary costs related to transaction, integration and restructuring cost associated with the Grontmij-acquisition totalled SEK 36 million and are reported in the Group-wide segment.
EBITA was SEK 228 million (228).
Increased amortizations of acquisition-related intangible assets due to the Grontmij-acquisition impacted EBIT, which totalled SEK 205 million (216).
Financing costs increased due to increased net debt. impacting profit after tax, which decreased to SEK 148 million (160).
Earnings per share decreased to SEK 1.24 per share (1.70) primarily due to extraordinary costs and an increased number of shares. As synergy realisation continues and extraordinary costs decrease. Sweco expects EPS accretion within two years after the acquisition of Grontmij, as previously communicated.
| Key ratios, Pro forma | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
Pro forma Apr 2015 - Mar 2016 |
Pro forma Full-year 2015 |
|---|---|---|---|---|
| Net sales, SEK M | 4,018 | 4,024 | 15,992 | 15,998 |
| Organic growth, % | 4 | |||
| EBITA excl. extraordinary items, SEK M | 263 | 258 | 1.106 | 1,100 |
| margin, % | 6,6 | 6.4 | 6.9 | 6.9 |
| Number of full-time employees | 14,589 | 14,557 | 14,560 | 14,552 |
| Billing ratio | 74.5% | 73.2% | 74.5% | 74.2% |
| Normal working hours | 478 | 488 | 1,958 | 1,968 |
| Net debt/EBITDA excl. extraordinary items | 1.5 | 1.2 |
| Key ratios, Actual | Actual Jan-Mar 2016 |
Actual Jan-Mar 2015 |
Actual Apr 2015 - Mar 2016 |
Actual Full-year 2015 |
|---|---|---|---|---|
| Net sales, SEK M | 4,018 | 2,465 | 12,941 | 11,389 |
| Acquisition-related growth, % | 64 | 18 | ||
| EBITA, SEK M | 228 | 228 | 740 | 740 |
| Margin, % | 5.7 | 9.3 | 5.7 | 6.5 |
| Profit after tax, SEK M | 148 | 160 | 427 | 439 |
| Earnings per share, SEK* | 1.24 | 1.70 | 3.99 | 4.36 |
| Number of full-time employees | 14,589 | 8,650 | 11,645 | 10,188 |
| Net debt/EBITDA | 2.1 | 1.3 | 1.8 |
In view of the preferential rights issue conducted during 04 2015, historical share data is restated pursuant to IAS 33.
Net sales by quarter and rolling 12 months
Sweco has been commissioned by Jernbaneverket, the Norwegian government's agency for railway services, to electrify the Norwegian Trønder Line and Meråker Line that cover a distance of approximately 200 kilometres. This is the first time Norwegian rail will be electrified since the 1970s, and this will improve the capacity, efficiency and environmental aspects of the region's public transport system. The electrification will reduce CO2 emissions by 12,300 tonnes per year. The project is valued at approximately SEK 26 million.
In Denmark, Sweco has been commissioned by Danish Railways (DSB) to design and manage the planning and construction of the renovation of Østerport train station in Copenhagen. The end result will be a modern junction linking the existing rail with the city's new City Ring metro line. The assignment is valued at approximately SEK 21 million.
After the close of the period Sweco Belgium has been commissioned by Société du Grand Paris for overall project management and detailed civil design for the construction of a new Metro line in Paris, part of the largest metro investment in Europe today. With an order value of approximately SEK 158 million, this is one of Sweco's largest projects to date.
Overall, the market for Sweco's services is good and development is stable.
The situation varies between markets. The Swedish market is strong, while the Norwegian market is good but has weakened. The markets in Denmark, Western Europe and Central Europe are in general good and are developing positively. The markets in Finland and in the Netherlands remain challenging.
The European economy has strengthened and GDP growth improved in all of Sweco's home markets, with the exception of Norway. Geopolitical turbulence, the global macro-economic situation and financial market developments are risks to the development.
EBITA by quarter and rolling 12 months
Demand for Sweco's services predominantly follows the general economic trend in Sweco's submarkets, with some time lag.
Sweco does not provide forecasts.
On 9 March Sweco announced that it would acquire Ludes, a German architecture and project management consultancy with around 100 employees. Ludes has a particularly strong position within healthcare. With Ludes, Sweco Germany establishes a presence in the German architecture market.
The acquisition is in line with Sweco's strategy of leveraging its new footprint in Northern Europe for bolt-on acquisitions, similar to the model successfully applied in the Nordic market.
Sweco has received competition clearance from the German authorities and closed the acquisition at April 15.
Grontmij, with approximately 6,000 employees in 9 countries, was acquired on 1 October 2015. Sweco is now the leading engineering and architecture consultancy in Europe. In 2014 Grontmij had annual sales of approximately SEK 6.0 billion and EBITA (as per Sweco's definition) of approximately SEK 203 million, excluding extraordinary expenses and the divested business in France. Sales for the combined company totalled approximately SEK 16 billion. Following the acquisition, Sweco has around 14,500 employees (pro forma 2015).
The acquisition of Grontmij creates value for all stakeholders - customers, employees, shareholders and society in general:
Sweco has completed around 100 acquisitions over the past 10 years. The acquisition of Grontmij is fully in line with Sweco's growth strategy and vision to be Europe's most respected architecture, engineering and environmental consultancy.
The integration is progressing well and in several areas faster than originally planned. Focus is mainly on profitability improvements and facilitating joint business opportunities.
The annual run rate of profitability improvements at the end of the first quarter was around SEK 160 million, an increase from SEK 100 million at the end of the fourth quarter 2015. Synergies and cost savings made a positive contribution of SEK 37 million to EBITA in the period.
Profitability improvements are found in four main areas:
tion is operational. Reductions in staff and management functions are completed and full-cost savings will be realized before year-end 2016
A reduction of approximately 200 positions is expected within the Group due to integration and restructuring. Notice has been given in most cases, and approximately 160 of these employees have left the Group by the end of the period.
At the announcement of the acquisition, annual profitability improvements were estimated at approximately SEK 250 million through cost savings in the joint operations. Ninety per cent of the savings were expected to be realised within four years, and most within two years. Realized savings to date show that Sweco is well on its way to realizing the targets that were initially set up.
Accumulated extraordinary costs totalled SEK 286 million at the end of the period, of which SEK 36 million arose during the first quarter. All extraordinary cost are reported in the Group-wide segment.
Extraordinary transaction, integration and restructuring costs were initially estimated at approximately SEK 450 million and expected to arise mostly during the fourth quarter of 2015 and first half of 2016. Extraordinary costs are developing according to plan and integration is expected to be completed within the previously announced cost-frame.
Additional value-creating opportunities can be achieved in the longer term by increasing Grontmij's customer focus and internal efficiency as well as through organic
and acquisition-based growth in Sweco's new home markets.
Sweco currently holds 97.36 per cent of all Grontmij shares and has initiated a statutory squeeze-out procedure for the remaining shares. Approximately SEK 94 million of the cash component remains to be paid in conjunction with the squeeze-out. Sweco is consolidating 100% of the shares. Since Sweco has initiated a statutory squeeze-out procedure the remaining consideration is reported as a liability and is included in net debt.
Group cash flow from operating activities totalled SEK -244 million (58) during the quarter. Interest-bearing net debt totalled SEK 2,033 million (1,252).
The net debt/EBITDA ratio was 2.1 times (1.3). Pro forma and adjusted for extraordinary costs, the net debt/EBITDA ratio was 1.5 times.
Available cash and cash equivalents, including unutilised credit lines, totalled SEK 1,672 million (1,118) at the end of the reporting period.
INVESTMENTS, JANUARY-MARCH 2016
Investments in equipment totalled SEK 50 million (41) and were primarily attributable to IT investments. Depreciation of equipment totalled SEK 55 million (37) and amortisation of intangible assets totalled SEK 34 million $(14)$ .
Purchase consideration paid to acquire companies and operations totalled SEK 10 million (29) and had a negative impact of SEK 5 million (-27) on Group cash and cash equivalents. Purchase consideration on the divestment of companies and operations totalled SEK 9 million (-) and had a positive impact of SEK 9 million (-) on Group cash and cash equivalents.
After the end of the reporting period, dividends totalling SEK 418 million (318) were distributed to Sweco AB shareholders.
Business Areas are reported on a pro forma basis following the new organisation since 1 October 2015. The pro forma reporting facilitates analysis of developments in operational activities on a like-for-like basis, assuming that Grontmij had been part of Sweco since the beginning of 2015.
Grontmij Sweden is now fully integrated into Sweco Sweden. Since 1 January, Grontmij's operations are integrated in corresponding division within Sweco Sweden.
Calendar effects had a negative impact of 12 working hours, producing a negative year-on-year effect on sales and operating profit of approximately SEK-37 million. The negative calendar effect was partly offset by an improved billing ratio and synergies realised within administrative overhead.
The Swedish market remains strong overall, with stable demand for Sweco's services. There is strong demand in the construction and real estate sector. The infrastructure market is also strong, supported by major public investments. The industrial market and the market for ITrelated services is developing positively. The market for power transmission services is strong, while other energy sectors are weak.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 1,758 | 1,732 |
| Organic growth, % | 1 | |
| Currency, % | 0 | |
| EBITA, SEK M | 170 | 184 |
| EBITA marain, % | 9.7 | 10.6 |
| Number of full-time employees | 5.469 | 5.297 |
The reduction in organic growth and operating profit were mainly attributable to fewer work-hours as a result of Easter falling in the first quarter this year, as opposed to the second quarter in 2015. The calendar effect during Easter is pronounced in Norway compared to the rest of the group. The year-on-year calendar effect of -24 hours had a negative impact on sales and profit of approximately SEK-23 million. Also, negative currency effects reduced net sales and profit by 9 per cent.
The negative calendar effect was partly offset by an improved billing ratio.
The Norwegian market is good, but has weakened. This trend is in line with the slowdown of the Norwegian economy in the wake of falling oil prices.
The Norwegian economy is in transition and demand is distributed unevenly. Markets in the Oslo region and
within infrastructure remain strong. The construction and real estate market in particular has weakened in the western and northern regions of Norway. The market for energy-related services is weak.
Since 1 January, Grete Aspelund is the President of Sweco Norway.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 499 | 531 |
| Organic growth, % | 2 | |
| Currency, % | $-9$ | |
| EBITA, SEK M | 29 | 40 |
| EBITA marain, % | 5.8 | 7.5 |
| Number of full-time employees | 1,353 | 1,315 |
SALES AND PROFIT, JANUARY-MARCH
Organic growth was 11 per cent despite a challenging market and negative calendar effects.
The calendar effect was -6 hours, which had a negative impact on net sales and profit of approximately SEK-6 million.
Operating profit improved to SEK 21 million (17). The profit improvement is mainly attributable to an increased billing ratio and lower project write-downs.
The Finnish market remains challenging. The Finnish economy has basically had zero GDP growth since 2011.
Despite this, demand for construction and real estate-related services is satisfactory while the infrastructure and industry markets remain challenging.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 432 | 392 |
| Organic growth, % | 11 | |
| Currency, % | $-1$ | |
| EBITA, SEK M | 21 | 17 |
| EBITA marain, % | 4.8 | 4.2 |
| Number of full-time employees | 1,972 | 1.905 |
Sales were essentially unchanged with a slight increase in profitability. Underlying improvements to profitability are largely offset by negative calendar effects. The negative calendar effect was -15 hours and had a negative year-on-year impact of SEK-9 million on net sales and profit. Operating profit increased to SEK 4 million (0), primarily due to operational improvements and lower project write-downs.
The market in Denmark is generally good and is developing positively. The construction and real estate sector is evolving well and is particularly strong in the bigger cities. The infrastructure market has lower demand and price pressure, but positive prospects are seen in ports. Demand in the water and energy sector is stable.
Sweco Denmark is going through a turnaround. Profitability is improving, although still unsatisfactory. Actions are being taken and the first signs of stabilisation and improvements are visible.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 330 | 334 |
| Organic growth, % | Ω | |
| Currency, % | -1 | |
| EBITA, SEK M | 4 | O |
| EBITA margin, % | 1.2 | 0.1 |
| Number of full-time employees | 1,140 | 1.143 |
Sales decreased to SEK 423 million (471), primarily due to a weak market and the ongoing restructuring. Operating profit increased to SEK 18 million (14). The profit improvement was mainly due to lower project write-downs and operational improvements.
The market in the Netherlands has been challenging for several years due to the country's real estate and financial crisis. The first signs of stabilization of market development were visible during the first quarter, particularly within private building construction.
Sweco Netherlands delivers services primarily in the areas of public infrastructure, water and public sector buildings. Overall, the market remains challenging.
Sweco Netherlands introduced a new customer-focused and decentralised organisational model during the end of 2015 and the implementation will continue in 2016. The business is being restructured and staff reductions within administration and the consultant organisation are ongoing.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 423 | 471 |
| Organic growth, % | -9 | |
| Currency, % | $-1$ | |
| EBITA, SEK M | 18 | 14 |
| EBITA marain, % | 4.4 | 2.9 |
| Number of full-time employees | 1,543 | 1.707 |
Organic growth was 6 per cent during the quarter, mainly due to good growth in the UK. Operating profit increased to SEK 23 million (13), mainly due to improved profit in Belgium and the UK.
The market in the UK is good and the general market sentiment improved during the quarter. The construction and real estate market in London is particularly strong. The infrastructure market is good, while demand varies in the energy and water market.
The market in Belgium is generally stable within all market segments and the building market is improving. The markets in Bulgaria and Turkey are stable.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 398 | 384 |
| Organic growth, % | 6 | |
| Currency, % | -3 | |
| EBITA, SEK M | 23 | 13 |
| EBITA marain, % | 5.9 | 3.4 |
| Number of full-time employees | 1.663 | 1.600 |
Organic growth is positive in Sweco Central Europe, still sales decreased to SEK 221 million (224). The acquired growth is negative due to divestments of operations in Russia and Slovakia.
Operating profit decreased to SEK 3 million (12). Compared with last year, the negative deviation is mainly due to weak development in Lithuania and due to a different periodisation of holiday accruals in Germany. On the latter, the full-year effect will be nil compared with last year.
The German market is good overall and is developing positively. The construction and real estate market is good and is evolving well. Demand is solid in the transport and environmental sector due to public investments, while the energy market is challenging.
During the quarter Sweco acquired the German architecture firm Ludes with around 100 employees. The transaction was closed on 15 April.
The Polish and Lithuanian markets are seeing weak development due to delayed EU investments in public infrastructure, water and environment. The EU investments are expected to begin in the end of 2016.
The Czech market remains challenging, although there is solid demand for Sweco's services.
| Net sales and profit | Actual Jan-Mar 2016 |
Pro forma Jan-Mar 2015 |
|---|---|---|
| Net sales, SEK M | 221 | 224 |
| Organic growth, % | 2 | |
| Acquisition-related growth, % | -2 | |
| Currency, % | $-1$ | |
| EBITA, SEK M | 3 | 12 |
| EBITA margin, % | 1.1 | 5.4 |
| Number of full-time employees | 1,357 | 1.443 |
Parent Company net sales totalled SEK 128 million (89) and were attributable to intra-group services. Profit after net financial items totalled SEK-46 million (-11). Investments in equipment totalled SEK 5 million (9). Cash and cash equivalents at the end of the period totalled SEK 16 million (2).
Sweco complies with the International Financial Reporting Standards (IFRS) and interpretive statements from the International Financial Reporting Interpretations Committee (IFRIC), as adopted by the EU. This interim report was prepared in accordance with IAS 34, Interim Reporting; the Swedish Annual Accounts Act; and the Swedish Financial Reporting Board's RFR 2, Reporting for Legal Entities.
The Group applies the same accounting and valuation principles as those described in Note 1 of the 2015 annual report. In this interim report, amounts in brackets refer to the corresponding period of the previous year. Because table items are individually rounded off, table figures do not always tally.
The Sweco share is listed on Nasdag Stockholm. The share price of the Sweco B share was SEK 133.4 at the end of the period, representing a 7.4 per cent increase during the quarter. The Nasdaq Stockholm General Index decreased by -3 per cent over the same period.
In accordance with the request of the shareholders, 5.453 class A shares were converted into class B shares with the support of the conversion clause in Sweco's Articles of Association.
The total number of shares at the end of the period was 121,094,830: 10,533,731 Class A shares, 109,661,099 Class B shares and 900,000 Class C shares. The total number of outstanding shares was 119,485,136: 10,533,731 Class A shares and 108,951,405 Class B shares.
RESOLUTIONS AT THE 2016 ANNUAL GENERAL MEETING 2016 share savings scheme: Pursuant to the Board's proposal, the 2016 AGM resolved to introduce a longterm share savings scheme for up to 100 Sweco Group senior executives and other key employees.
2016 share bonus scheme: Pursuant to the Board's proposal, the 2016 AGM resolved to introduce a share-based incentive scheme geared for employees in Sweden.
Significant risks and uncertainties affecting the Sweco Group and the Parent Company include business risks
associated with the general economic trend and investment spending in various markets, the capacity to attract and retain skilled personnel and the effects of political decisions. The Group is also exposed to various types of financial risks, such as foreign currency, interest rate and credit risks. No significant risks are deemed to have arisen apart from the risks detailed in Sweco's 2015 annual report (page 90, Risks and Risk Management).
The number of normal working hours in 2016, based on the pro forma 12-month sales-weighted business mix as of 03 2015, is broken down as follows:
| Quarter 1: | 478 (488) | -10 |
|---|---|---|
| Quarter 2: | 490 (469) | +21 |
| Quarter 3: | 518 (519) | -1 |
| Quarter 4: | 493 (492) | $+1$ |
| Total 2016: | 1.979 (1,968) | +11 |
FORTHCOMING FINANCIAL INFORMATION
Interim report January-June 18 July 2016 Interim report January-September 28 October 2016 Year-end report 2016 14 February 2017
Stockholm, 11 May 2016
President and CEO. Board member
FOR FURTHER INFORMATION, PLEASE CONTACT: Tomas Carlsson, President and CEO Phone +46 8 695 66 60 / +46 70 552 92 75 [email protected]
Jonas Dahlberg, CFO
Phone +46 8 695 63 32 / +46 70 347 23 83 [email protected]
SWEC0 AB (publ) Org. nr. 556542-9841 Gjörwellsgatan 22, Box 34044, 100 26 Stockholm Phone +46 8 695 60 00, Email [email protected] www.swecogroup.com
This report has not been audited.
| $\textsf{Key ratios}^{\textsf{1)}}$ | Jan-Mar 2016 | Jan-Mar 2015 | Apr 2015-Mar 2016 | Full-year 2015 |
|---|---|---|---|---|
| Profitability | ||||
| EBITA margin, % | 5.7 | 9.3 | 5.7 | 6.5 |
| Operating margin (EBIT), % | $5.1\,$ | 8.8 | 5.2 | 6.0 |
| Profit margin, % | 4.8 | 8.5 | 4.8 | 5.6 |
| Revenue growth | ||||
| Organic growth, % | $1\,$ | $\overline{4}$ | 6 | |
| Acquisition-related growth, % | 64 | $\mathbf 1$ | 18 | |
| Currency effects, % | $-2$ | $\mathbf{1}$ | $\mathbf 0$ | |
| Total growth, % | 63 | 6 | 24 | |
| Debt | ||||
| Net debt, SEK M | 2,033 | 1,252 | 1,688 | |
| Interest-bearing debt, SEK M | 2,378 | 1,354 | 2,232 | |
| Financial strength | ||||
| Net debt/Equity, % | 40.5 | 61.8 | 34.4 | |
| Net debt/EBITDA, x | 2.1 | 1.3 | 1.8 | |
| Equity/Assets ratio, % | 39.1 | 31.7 | 39.0 | |
| Available cash and cash equivalents, SEK M 2) | 1,672 | 1,118 | 2,229 | |
| Return | ||||
| Return on equity, % | 12.1 | 29.5 | 12.9 | |
| Return on capital employed, % | 12.5 | 23.5 | 13.2 | |
| Share data 3) | ||||
| Earnings per share, SEK 3) | 1.24 | 1.70 | 3.99 | 4.36 |
| Diluted earnings per share, SEK3) | 1.22 | 1.67 | 3.94 | 4.30 |
| Equity per share, SEK3)4) | 41.90 | 21.37 | 40.98 | |
| Diluted equity per share, SEK3)4) | 41.39 | 21.03 | 40.49 | |
| Number of outstanding shares at reporting date | 119,485,136 | 90,818,083 | 119,537,510 | |
| Number of repurchased Class B and Class C shares | 1,609,694 | 1,598,764 | 1,557,320 |
1) Key ratio definitions are available on Sweco's website. Key ratios in this table refer to the consolidated accounts (not pro forma).
2) Including unutilised credit.
3) Historical share data is restated in accorda
| Income Statement | ||||
|---|---|---|---|---|
| SEKM | Jan-Mar 2016 | Jan-Mar 2015 | Apr 2015-Mar 2016 | Full-year 2015 |
| Net sales | 4,018 | 2,465 | 12,941 | 11,389 |
| Other income | 0 | 0 | 0 | $\Omega$ |
| Other external expenses | $-952$ | $-539$ | $-3,290$ | $-2,877$ |
| Personnel expenses | $-2,769$ | $-1,658$ | $-8,693$ | $-7,581$ |
| EBITDA | 296 | 268 | 959 | 931 |
| Amortisation/depreciation and impairments | $-69$ | $-40$ | $-219$ | $-190$ |
| EBITA | 228 | 228 | 740 | 740 |
| Acquisition-related items 1) | $-23$ | $-12$ | $-70$ | -60 |
| Operating profit (EBIT) | 205 | 216 | 670 | 681 |
| Net financial items | $-11$ | $-7$ | $-45$ | $-41$ |
| Profit before tax | 194 | 210 | 625 | 640 |
| Income tax | -46 | $-49$ | $-198$ | $-200$ |
| PROFIT FOR THE PERIOD | 148 | 160 | 427 | 439 |
| Attributable to: | ||||
| Parent company shareholders | 148 | 160 | 426 | 438 |
| Non-controlling interests | 0 | 0 | 1 | 1 |
| Earnings per share attributable to parent company share- holders, SEK 2) |
1.24 | 1.70 | 3.99 | 4.36 |
| Average number of shares 2) | 119,475,201 | 94,259,333 | 106,749,089 | 100,445,122 |
| Dividend per share, SEK 2) | 3.50 |
1) Acquisition-related items are defined asamortisation and impairment of goodwill and acquisition-related intangible assets, revaluation of additional purchase price, and
profit and loss on the divestment of companies
| Consolidated income statement and other comprehensive income, SEK M |
Jan-Mar 2016 | Jan-Mar 2015 | Apr 2015-Mar 2016 | Full-year 2015 |
|---|---|---|---|---|
| Profit for the period | 148 | 160 | 427 | 439 |
| Items that will not be reversed in the income statement | ||||
| Revaluation of defined benefit pensions, net after tax 1,3) | $-21$ | 24 | 45 | |
| Items that may subsequently be reversed in the income statement |
||||
| Revaluation of Grontmij NV holding, net after tax 2) | 12 | 12 | ||
| Translation differences, net after tax | $-28$ | -9 | $-112$ | $-92$ |
| Translation differences transferred to profit for the period | - | 5 | 5 | |
| COMPREHENSIVE INCOME FOR THE PERIOD | 99 | 152 | 357 | 410 |
| Attributable to: | ||||
| Parent company shareholders | 99 | 152 | 356 | 409 |
| Non-controlling interests | 0 | 0 | ||
| $1)$ Tax on revaluation of defined benefit pensions | $-5$ | $-16$ | ||
| 2) Tax on revaluation of Grontmij NV holding | -3 | $-3$ |
3) Revalued annually. Reviewed quarterly in the event of material changes to actuarial assumptions.
| Cash flow statement SEKM |
Jan-Mar 2016 | Jan-Mar 2015 | Apr 2015-Mar 2016 | Full-year 2015 |
|---|---|---|---|---|
| Cash flow from operating activities before changes in working capital and tax paid |
274 | 261 | 965 | 952 |
| Tax paid | $-81$ | -56 | $-182$ | $-157$ |
| Changes in working capital | $-437$ | $-147$ | 55 | 345 |
| Cash flow from operating activities | $-244$ | 58 | 838 | 1,140 |
| Cash flow from investing activities | $-56$ | $-66$ | $-1.430$ | $-1.440$ |
| Cash flow from financing activities | 110 | $-64$ | 881 | 707 |
| CASH FLOW FOR THE PERIOD | $-190$ | $-72$ | 289 | 407 |
| Balance sheet SEKM |
31 Mar 2016 | 31 Mar 2015 | 31 Dec 2015 |
|---|---|---|---|
| Goodwill | 5,757 | 2,148 | 5.752 |
| Other intangible assets | 390 | 113 | 416 |
| Property, plant and equipment | 637 | 406 | 639 |
| Financial assets | 167 | 48 | 157 |
| Current assets excl. cash and cash equivalents | 5,528 | 3,579 | 5,068 |
| Cash and cash equivalents incl. short-term investments | 345 | 102 | 544 |
| TOTAL ASSETS | 12,825 | 6,397 | 12,575 |
| Equity attributable to parent company shareholders | 5,007 | 2,015 | 4,899 |
| Non-controlling interests | 9 | 11 | 9 |
| Total equity | 5,015 | 2,026 | 4,907 |
| Non-current liabilities | 2,615 | 1,228 | 2,700 |
| Current liabilities | 5,194 | 3.143 | 4,968 |
| TOTAL EQUITY AND LIABILITIES | 12,825 | 6,397 | 12,575 |
| Contingent liabilities | 646 | 250 | 704 |
| Changes in equity SEKM |
Jan-Mar 2016 | Jan-Mar 2015 | ||||||
|---|---|---|---|---|---|---|---|---|
| Equity attribut- able to parent company shareholders |
Non-controlling interests |
Total equity | Equity attribut- able to parent company shareholders |
Non-controlling interests |
Total equity | |||
| Equity, opening balance | 4,899 | 9 | 4,907 | 1,874 | 14 | 1.888 | ||
| Comprehensive income for the period | 99 | 0 | 99 | 152 | 0 | 152 | ||
| Acquisition of non-controlling interests | $-12$ | $-3$ | $-15$ | |||||
| Divestment of non-controlling interests | 0 | 0 | ||||||
| Buy-back of treasury shares | $-20$ | $-20$ | ||||||
| Sale of treasury shares | 3 | $\overline{\phantom{a}}$ | ||||||
| Share-based incentive schemes | 25 | $\overline{\phantom{a}}$ | 25 | |||||
| Share savings schemes | $\overline{\phantom{a}}$ | |||||||
| EQUITY, CLOSING BALANCE | 5,007 | 9 | 5,015 | 2,015 | 11 | 2,026 |
During the period Sweco acquired Petro Team Engineering AB, Sletten AS and extended the participation in Par 2 Ontwikkeling B.V. to 100 per cent (was 50 per cent owned). The acquired businesses have an aggregate total of 13 employees. Purchase consideration totalled SEK10 million and had a negative impact on cash and cash equivalents of SEK5 million. The acquisitions impacted the consolidated balance sheet as detailed in the table below. Of the unsettled purchase price commitment of SEK 3 million, SEK 1 million refers to conditional contingent consideration. During the period the acquired companies contributed SEK4 million in sales and SEK 0.1 million in operating profit (EBIT) before extraordinary cost. If all of the companies had been owned as of 1 January 2016 they would have contributed approximately SEK 4 million in sales and about SEK 0.1 million in operating profit before extraordinary cost.
| Acquisitions, SEK M | |
|---|---|
| Intangible assets | 8 |
| Property, plant and equipment | |
| Current assets | 13 |
| Non-current liabilities | $-5$ |
| Other current liabilities | $-7$ |
| Total purchase consideration | 10 |
| Unsettled purchase price commitment | $-3$ |
| Cash and cash equivalents | $-2$ |
| DECREASE IN GROUP CASH AND CASH EQUIVALENTS | 5 |
During the period Sweco divested business within Sweco Nederland BV and Park Frederiksoord B.V. with total 38 employees. The businesses contributed SEK 5 million in sales and SEK 0 million in operating profit. The divestments had a positive impact on profit of SEK 0.5 million and a positive impact on the Group's cash and cash equivalents of SEK 2 million. The divestments impacted the consolidated balance sheet as detailed below.
| Divestments, SEK M | |
|---|---|
| Property, plant and equipment | 6 |
| Current assets | 3 |
| Capital gain recorded on divestment | |
| Total purchase consideration | ٥ |
| Cash and cash equivalents in divested companies | |
| INCREASE IN GROUP CASH AND CASH EQUIVALENTS | ۰ |
After the end of the period. Sweco completed the acquisition of Ludes, a German architecture and project management company with around 100 employees. The transaction was closed at April 15 and the company will be consolidated in Sweco's accounts during the second quarter.
The Group's financial assets measured at fair value totalled SEK 14 million (12). The derivative instruments are forward currency contracts, the fair value of which are determined based on listed prices for forward currency contracts on the balance sheet date (Level 2). The fair value of unlisted financial assets is determined through market valuation techniques (observable market inputs) such as recent transactions, listed prices of similar instruments and discounted cash flows. In the event no reliable inputs are available for determining fair value, financial assets are reported at acquisition value (Level 3). There were no transfers between levels during the period.
Sweco has restated historical figures to reflect the new Sweco Group organisational structure, effective as of 1 October 2015. Grontmij is included pro forma as if the acquisition had taken place on 31 December 20131).
| Quarterly summary 2) | Actual 2016 Q1 |
Actual 2015 04 |
Pro forma 2015 Q3 |
Pro forma 2015 02 |
Pro forma 2015 01 |
Pro forma 2014 Q 4 |
|---|---|---|---|---|---|---|
| Net sales, SEK M | ||||||
| Sweco Sweden | 1,758 | 1,921 | 1,390 | 1,795 | 1,732 | 1,768 |
| Sweco Norway | 499 | 508 | 401 | 551 | 531 | 521 |
| Sweco Finland | 432 | 488 | 375 | 408 | 392 | 417 |
| Sweco Denmark | 330 | 365 | 320 | 331 | 334 | 328 |
| Sweco Netherlands | 423 | 450 | 445 | 465 | 471 | 496 |
| Sweco Western Europe | 398 | 428 | 389 | 393 | 384 | 362 |
| Sweco Central Europe | 221 | 262 | 220 | 245 | 224 | 258 |
| Group-wide, Eliminations, etc. | $-45$ | $-73$ | $-36$ | $-68$ | $-44$ | $-43$ |
| TOTAL GROUP | 4,018 | 4,350 | 3,504 | 4,120 | 4,024 | 4,107 |
| EBITA, SEK M | ||||||
| Sweco Sweden | 170 | 211 | 91 | 186 | 184 | 223 |
| Sweco Norway | 29 | 52 | 24 | 44 | 40 | 58 |
| Sweco Finland | 21 | 35 | 27 | 10 | 17 | 3 |
| Sweco Denmark | 4 | 28 | 18 | -8 | $\mathbf{0}$ | $-5$ |
| Sweco Netherlands | 18 | $-1$ | 12 | 0 | 14 | 21 |
| Sweco Western Europe | 23 | 25 | 22 | 23 | 13 | 20 |
| Sweco Central Europe | $\overline{3}$ | 19 | $\overline{7}$ | 11 | 12 | 19 |
| Group-wide, Eliminations, etc. | $-40$ | $-170$ | $-63$ | $-79$ | $-23$ | $-58$ |
| EBITA | 228 | 200 | 138 | 187 | 257 | 281 |
| Extraordinary items 3) | 36 | 190 | 59 | 70 | $\mathbf 1$ | 58 |
| EBITA excl. extraordinary items | 263 | 390 | 197 | 257 | 258 | 339 |
| EBITA margin, % | ||||||
| Sweco Sweden | 9.7 | 11.0 | 6.6 | 10.4 | 10.6 | 12.6 |
| Sweco Norway | 5.8 | 10.2 | 6.1 | 8.0 | 7.5 | 11.0 |
| Sweco Finland | 4.8 | 7.1 | 7.3 | 2.5 | 4.2 | 0.8 |
| Sweco Denmark | 1.2 | 7.7 | 5.6 | $-2.3$ | 0.1 | $-1.4$ |
| Sweco Netherlands | 4.4 | $-0.3$ | 2.6 | 0.1 | 2.9 | 4.2 |
| Sweco Western Europe | 5.9 | 5.9 | 5.7 | 5.8 | 3.4 | 5.5 |
| Sweco Central Europe | 1.1 | 7.4 | 3.1 | 4.3 | 5.4 | 7.4 |
| EBITA margin | 5.7 | 4.6 | 3.9 | 4.5 | 6.4 | 6.8 |
| Extraordinary items 3) | 0.9 | 4.4 | 1.7 | 1.7 | 0.0 | 1.5 |
| EBITA margin excl. extraordinary items | 6.6 | 9.0 | 5.6 | 6.2 | 6.4 | 8.3 |
| Billing ratio, % | 74.5% | 74.7% | 74.1% | 74.8% | 73.2% | 73.8% |
| Number of normal working hours | 478 | 492 | 519 | 469 | 488 | 486 |
| Number of full-time employees | 14.589 | 14,621 | 14.339 | 14,707 | 14.557 | 14,565 |
1)The pro forma information is based on the consolidated income statements for the fourth quarter of 2014 and for the first three quarters of 2015 of Sweco and Grontmij respectively. Sweco and Grontmij
both apply IFRS. T
thanculates or uronump have been aupstered to be unishered with overcus of observation of the income searchers the prototion and monitosity strip income search of the product of the state of the state. Groupwide, eliminati
| January-March | Net sales SEKM |
EBITA SEKM |
EBITA margin % |
Number of full-time employees |
||||
|---|---|---|---|---|---|---|---|---|
| Actual | Pro forma | Actual | Pro forma | Actual | Pro forma | Actual | Pro forma | |
| Business area | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 | 2016 | 2015 |
| Sweco Sweden | 1,758 | 1,732 | 170 | 184 | 9.7 | 10.6 | 5,469 | 5,297 |
| Sweco Norway | 499 | 531 | 29 | 40 | 5.8 | 7.5 | 1,353 | 1,315 |
| Sweco Finland | 432 | 392 | 21 | 17 | 4.8 | 4.2 | 1,972 | 1,905 |
| Sweco Denmark | 330 | 334 | 4 | 0 | 1.2 | 0.1 | 1.140 | 1,143 |
| Sweco Netherlands | 423 | 471 | 18 | 14 | 4.4 | 2.9 | 1,543 | 1,707 |
| Sweco Western Europe | 398 | 384 | 23 | 13 | 5.9 | 3.4 | 1.663 | 1,600 |
| Sweco Central Europe | 221 | 224 | 3 | 12 | 1.1 | 5.4 | 1,357 | 1.443 |
| Group-wide, Eliminations, etc. 1) | $-45$ | $-44$ | -40 | $-23$ | $\overline{\phantom{a}}$ | $\overline{\phantom{0}}$ | 92 | 148 |
| TOTAL GROUP | 4,018 | 4,024 | 228 | 257 | 5.7 | 6.4 | 14,589 | 14,557 |
1)Groupwide, eliminations, etc. includes group functions, the operations in China as well as Grontmij's real estate operations. All extraordinary items are included in Group-wide.
| Parent Company income statement, SEK M | Jan-Mar 2016 | Jan-Mar 2015 | Full-year 2015 |
|---|---|---|---|
| Net sales | 128 | 89 | 355 |
| Operating expenses | $-166$ | $-93$ | -399 |
| Operating loss | $-39$ | -5 | -44 |
| Net financial items | $-7$ | -6 | 508 |
| Profit/loss after net financial items | $-46$ | $-11$ | 464 |
| Appropriations | $-20$ | ||
| Profit/loss before tax | -46 | $-11$ | 444 |
| Tax | $-61$ | ||
| PROFIT/LOSS AFTER TAX | -46 | $-11$ | 383 |
| Parent Company balance sheet, SEK M | 31 Mar 2016 | Full-year 2015 |
|---|---|---|
| Intangible assets | 78 | 81 |
| Property, plant and equipment | 48 | 50 |
| Financial assets | 6,346 | 6,348 |
| Current assets | 202 | 1,911 |
| TOTAL ASSETS | 6,675 | 8,390 |
| Equity | 4,590 | 4,619 |
| Untaxed reserves | 23 | 23 |
| Non-current liabilities | 1,842 | 2,083 |
| Current liabilities | 220 | 1,665 |
| TOTAL EQUITY AND LIABILITIES | 6,675 | 8,390 |
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