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Instalco
Quarterly Report • Oct 25, 2024
2929_10-q_2024-10-25_8cd0eadd-7c41-4dc7-b088-7fe87cb84df9.pdf
Quarterly Report
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Interim report January – September 2024
July - September 2024
- Net sales decreased by 5.0 percent and amounted to SEK 3,144 (3,310) million. The organic change, adjusted for currency effects, amounted to -5.0 (3.0) percent.
- EBITA was SEK 188 (246) million.
- The EBITA margin was 6.0 (7.4) percent
- Operating profit (EBIT) amounted to SEK 149 (194) million.
- Cash flow from operating activities for the period was SEK 119 (119) million.
- Earnings per share before dilution were SEK 0.32 (0.52) and after dilution were SEK 0.32 (0.52).
- One acquisition was made during the period, which, on an annual basis, contributes an estimated total sales of SEK 40 million.
January - September 2024
- Net sales decreased by 3.1 percent and amounted to SEK 10,082 (10,406) million. The organic change, adjusted for currency effects, amounted to -6.2 (7.2) percent.
- EBITA was SEK 683 (775) million.
- The EBITA margin was 6.8 (7.4) percent
- Operating profit (EBIT) amounted to SEK 563 (628) million.
- Cash flow from operating activities for the period was SEK 475 (567) million.
- Earnings per share before dilution were SEK 1.17 (1.58) and after dilution were SEK 1.17 (1.56).
- Three acquisitions were made during the period, which, on an annual basis, contribute an estimated total sales of SEK 69 million.
Key figures1
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Rolling | Jan-Dec | |||
|---|---|---|---|---|---|---|---|---|
| AMOUNTS IN SEK M | 2024 | 2023 | ∆% | 2024 | 2023 | ∆% 12 months | 2023 | |
| Net sales | 3,144 | 3,310 | -5.0 | 10,082 | 10,406 | -3.1 | 13,956 | 14,279 |
| EBITDA | 297 | 327 | -9.3 | 977 | 1,010 | -3.3 | 1,382 | 1,416 |
| EBITA | 188 | 246 | -23.6 | 683 | 775 | -11.8 | 993 | 1,085 |
| EBITA margin, % | 6.0 | 7.4 | 6.8 | 7.4 | 7.1 | 7.6 | ||
| Operating profit (EBIT) | 149 | 194 | -23.1 | 563 | 628 | -10.3 | 834 | 899 |
| Profit/loss before tax | 106 | 179 | -41.1 | 414 | 553 | -25.1 | 653 | 792 |
| Cash flow from operating activities | 119 | 119 | -0.2 | 475 | 567 | -16.2 | 907 | 999 |
| Net debt/EBITDA, times | 2.7 | 2.6 | 2.7 | 2.6 | 2.7 | 2.4 | ||
| Cash conversion (12-Month rolling),% | 87 | 88 | 87 | 88 | 87 | 90 | ||
| Earnings per share before dilution, SEK | 0.32 | 0.52 | -37.8 | 1.17 | 1.58 | -26.1 | 1.87 | 2.29 |
| Earnings per share after dilution, SEK | 0.32 | 0.52 | -37.8 | 1.17 | 1.56 | -25.2 | 1.87 | 2.26 |
| Order backlog | 8,533 | 9,201 | -7.3 | 8,533 | 9,201 | -7.3 | 8,533 | 8,437 |
1 For definitions of alternative key figures as per the ESMA guidelines, please see the definitions of key figures at instalco.se.
The long-term rising need for qualified installation services remains. From a short-term perspective, Instalco continued to navigate a challenging market in the third quarter. This was particularly true of the major metropolitan regions and southern Sweden. Although we are unable to impact the market situation, we are working proactively with our profitability and mitigation efforts.
The service area is still reporting strong growth, which is an important stabilising factor for the Group. Instalco's decentralised business model and strategy of proximity to our customers has enabled us to adapt to local market changes.
Many of our ongoing projects were signed in a market where there is significant price pressure, which is reflected in our margins. Just like previously this year, we have remained cautious about growing the order backlog to avoid getting locked into long-term, less profitable projects because of the pricing situation that we currently face. We want to have available capacity for when market conditions improve, so that we can ensure sustainable, profitable growth. Though many leading indicators point upward, it is of course still too early to know exactly when the market will turn.
It is reassuring to see that, despite the external challenges, we are reporting stable cash conversion. At the same time, our leverage is somewhat higher than our target, which is primarily attributable to the lower growth in earnings. During the last year, we have slowed down the acquisition tempo, which was the case during the third quarter as well. In August, however, we did make one interesting smaller acquisition in Finland of IT-Line Service Oy which primarily serves customers in the mechanical industry. It has solid profitability and strengthens our industrial offering in Finland – in line with our strategy of growing the industrial segment and expanding on the Finnish market.
Unique culture, collaboration and expertise gives us advantages
The last few quarters have been a time for efficiency measures and strategic preparations. Although the market remains challenging, we know that it is precisely in times like these that we must lay the foundation for our future growth. We are keeping the focus on fostering our unique culture and promoting profitability within the Group. Through our GoGr8 program, we are working proactively to spread best practice and a culture of strong profitability, while offering coaching and support to specific subsidiaries to ensure their success.
The Instalco model is also based on collaboration with customers and among our subsidiaries. Through our close ties and comprehensive solutions on offer, we are able to generate successful projects. One example of that is the comprehensive assignment for installations at the new Gothenburg Central Station, where eight Instalco companies are collaborating to deliver design and installation of the electrical, heating & plumbing, ventilation, sprinkler and automation solutions. Besides that, Instair and Sprinklerbolaget recently signed a joint agreement for the ventilation and sprinkler systems at the new emergency hospital in Västerås after first having been involved in the planning and design phase. It confirms our
position as one of the leading providers of installations at hospitals in Sweden. We are both delighted and proud to have been chosen for this next phase of the project. It also confirms that the multidisciplinary comprehensive solutions we offer is a winning concept.
Preparations for sustainable growth
Energy efficiency and lower consumption of resources provide the foundation for the services that Instalco offers. We have also noticed a growing interest in ways of measuring greenhouse gas emissions and how to report ESG data among our customers and investors. The green transition is a shared responsibility where we, customers and suppliers need to work together to create a robust sustainability data platform. These are things that have been high on our list of priorities during the year, and we are preparing for adaptation to the new EU Directive on Corporate Social Responsibility (CSRD). It is something that will make our customer offering even more attractive.
In summary, we do not see the challenges of the market situation as permanent. We are preparing for the next growth cycle. When the turnaround comes, Instalco will be better positioned than ever to capitalise on the opportunities that arise.
Robin Boheman CEO
The Nordic market of installation services
There is a strong underlying demand for Instalco's services and the interest in energy-efficient, resource-saving installation services is constantly growing. However, the market outlook over the short to medium term is difficult to assess given the prevailing macroeconomic situation. There are also large regional variations in both demand and pricing. Construction starts for new housing in particular have been affected. That, however, is an area where Instalco's direct exposure is low. Falling interest rates will benefit the entire construction industry over the medium term.
Generally speaking, the market is highly influenced by a number of long-term trends and the overall development of society. Some of the important trends behind this are technological advancements with digitalization and electrification, along with certain challenges, such as ageing property holdings, a growing population and energy shortages. Other important driving forces that contribute to the rising demand for Instalco's core offering are the need for green transition and the requisite green industrial investments in the Nordics, as well as a strengthened defence force.
Net sales
Third quarter
Sales for the quarter amounted to SEK 3,144 (3,310) million, which is a decrease of 5.0 percent. Adjusted for currency effects, the organic change amounted to -5.0 percent and acquired growth was 1.5 percent. Currency fluctuations only had a marginal impact on net sales.
January – September
Net sales for the period amounted to SEK 10,082 (10,406) million, which is a decrease of 3.1 percent. Adjusted for currency effects, the organic change amounted to -6.2 percent and the acquired growth amounted to 4.0 percent.
Currency fluctuations only had a marginal impact on net sales.
Order backlog
Order backlog at the end of the period amounted to SEK 8,533 (9,201) million, which is a decrease of -7.3 percent. Organically, for comparable units, the order backlog fell, adjusted for currency effects, by -6.4 percent. The order backlog of acquired companies contributed with growth of 0.3 percent.
For example, during the quarter, eight Instalco subsidiaries won a joint assignment for the design and installation pf solutions at the new Gothenburg Central Station. The client is Peab and the end customer is Jernhusen. The contract value is approximately SEK 100 million. The following Instalco companies are involved: Elektro-Centralen, LG Contracting, Tofta Plåt & Ventilation, Sprinklerbolaget, Bogesunds El & Tele, Intec, Ovau and Inmatiq. They will be responsible for design and installation of the electrical, heating & plumbing, ventilation and sprinkler systems, as well as the control technology and automatics.
Earnings
Third quarter
Operating profit before amortisation of acquired intangible assets (EBITA) for the period amounted to SEK 188 (246) million, which corresponds to an EBITA margin of 6.0 (7.4) percent, which is primarily attributable to the prevailing market situation.
Operating profit (EBIT) for the quarter amounted to SEK 149 (194) million. Amortisation of acquired intangible assets decreased by SEK 13 million and amounted to SEK 39 (52) million. The decrease is attributable to a lower proportion of identified depreciable assets.
Net financial items for the quarter amounted to SEK -43 (- 15) million, of which unrealised value changes amounted to SEK 11 (5) million and the interest expense on external loans amounted to SEK -41 (-42) million. For the comparison period, there was a positive impact on net financial items of SEK 24 million from the divestment of subsidiaries.
Tax for the quarter was SEK -18 (-38) million, which corresponds to an effective tax rate of 17 (21) percent.
Earnings for the quarter were SEK 88 (142) million, which corresponds to earnings per share before dilution of SEK 0.32 (0.52) and earnings per share after dilution of SEK 0.32 (0.52).
January – September
Operating profit before amortisation of acquired intangible assets (EBITA) for the period amounted to SEK 683 (775) million, which corresponds to an EBITA margin of 6.8 (7.4) percent.
Operating profit (EBIT) for the period amounted to SEK 563 (628) million. Amortisation of acquired intangible assets decreased by SEK 27 million and amounted to SEK 120 (147) million. The decrease is attributable to a lower proportion of identified depreciable assets.
Net financial items for the period amounted to SEK -150 (-75) million, of which unrealised value changes amounted to SEK 1 (11) million and the interest expense on external loans amounted to SEK -124 (-108) million. The increase in interest costs stems from a mix of rate hikes from central banks and a higher level of borrowing. For the comparison period, there was a positive impact on net financial items of SEK 24 million from the divestment of subsidiaries.
Tax for the period was SEK -84 (-114) million, which corresponds to an effective tax rate of 20 (21) percent.
Earnings for the period were SEK 329 (439) million, which corresponds to earnings per share before dilution of SEK 1.17 (1.58) and earnings per share after dilution of SEK 1.17 (1.56).
Cash flow
Third quarter
Cash flow from operating activities amounted to SEK 119 (119) million, with a change in working capital of SEK -86 (-83) million. The Group's working capital fluctuates from one quarter to the next primarily because of fluctuations in these line items: work-in-progress, accounts receivable and accounts payable.
Cash flow from investing activities amounted to SEK -87 (- 256) million, of which acquisitions of subsidiaries and businesses amounted to SEK -33 (-222) million. Cash flow from financing activities amounted to SEK 84 (14) million, of which the net change in loans amounted to SEK 263 (67) million, the
acquisition of non-controlling interests to SEK -92 (0) million and amortisation of lease liabilities to SEK -87 (-63) million. Acquisition of non-controlling interests refers to the purchase of shares in existing subsidiaries where minority interests exist. The change in warrants was SEK 0 (-21) million and SEK 0 (31) million was added through the new issue.
January – September
Cash flow from operating activities amounted to SEK 475 (567) million, with a change in working capital of SEK -178 (-141) million. The Group's working capital fluctuates from one quarter to the next primarily because of fluctuations in these line items: work-in-progress, accounts receivable and accounts payable.
Cash flow from investing activities amounted to SEK -278 (- 1176) million, of which acquisitions of subsidiaries and businesses amounted to SEK -196 (-1089) million. Cash flow from financing activities amounted to SEK -338 (86) million, of which the net change in loans amounted to SEK 264 (385) million, the acquisition of non-controlling interests to SEK -200 (0) million and amortisation of lease liabilities to SEK -232 (- 186) million. Acquisition of non-controlling interests refers to the purchase of shares in existing subsidiaries where minority interests exist. Dividends of SEK 0.68 (0.66) per share were paid out during the period, which corresponds to SEK 179 (172) million. The change in warrants was SEK 10 (-21) million and SEK 0 (80) was added through the new issue.
Revenue by segment
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full-year | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| AMOUNTS IN SEK M | 2024 | Share | 2023 | Share | 2024 | Share | 2023 | Share | 2023 | Share |
| Sweden | 2,166 | 69% | 2,213 | 67% | 6,964 | 69% | 7,259 | 70% | 9,962 | 70% |
| Rest of Nordics | 978 | 31% | 1,098 | 33% | 3,118 | 31% | 3,146 | 30% | 4,317 | 30% |
| Total | 3,144 | 100% | 3,310 | 100% | 10,082 | 100% | 10,406 | 100% | 14,279 | 100% |
EBITA, EBITA margin and earnings before taxes, per segment
| Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | Full-year | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| EBITA | EBITA | EBITA | EBITA | EBITA | ||||||
| AMOUNTS IN SEK M | 2024 | margin | 2023 | margin | 2024 | margin | 2023 | margin | 2023 | margin |
| Sweden | 119 | 5.5% | 177 | 8.0% | 478 | 6.9% | 586 | 8.1% | 833 | 8.4% |
| Rest of Nordics | 68 | 6.9% | 68 | 6.2% | 207 | 6.6% | 191 | 6.1% | 253 | 5.9% |
| Group-wide | 2 | 2 | -2 | -2 | 0 | |||||
| EBITA | 188 | 6.0% | 246 | 7.4% | 683 | 6.8% | 775 | 7.4% | 1,085 | 7.6% |
| Amortisation of acquired | ||||||||||
| intangible assets | -39 | -52 | -120 | -147 | -186 | |||||
| Net financial items | -43 | -15 | -150 | -75 | -107 | |||||
| Profit/loss before tax | 106 | 179 | 414 | 553 | 792 |
Distribution of revenue
| Jul-Sep 2024 | Jul-Sep 2023 | Jan-Sep 2024 | Jan-Sep 2023 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| AMOUNTS IN SEK M | Service Contract | Total | Service Contract | Total | Service Contract | Total | Service Contract | Total | ||||
| Sweden | 752 | 1,414 | 2,166 | 687 | 1,525 | 2,213 | 2,335 | 4,629 | 6,964 | 2,154 | 5,105 | 7,259 |
| Rest of Nordics | 331 | 647 | 978 | 232 | 865 | 1,098 | 979 | 2,139 | 3,118 | 757 | 2,389 | 3,146 |
| Total | 1,083 | 2,061 | 3,144 | 920 | 2,391 | 3,310 | 3,314 | 6,768 | 10,082 | 2,911 | 7,494 | 10,406 |
| Share | 34% | 66% | 100% | 28% | 72% | 100% | 33% | 67% | 100% | 28% | 72% | 100% |
Market
Overall, the market for new construction, renovation and energy-efficiency measures is good for both commercial properties and facilities in the public sector. Downward pressure on prices, however, remains challenging. For new production of residential property, we've noticed a clear dampening effect, primarily due to the interest rate situation. Geographic differences in demand and pricing remain, with the strongest market conditions prevailing in the northern part of the country. The situation is somewhat weaker, however, in Stockholm and southern Sweden.
Swedish industry is investing heavily in new ventures and sustainable transition, particularly in the northern part of Sweden. The prison system and armed forces are also renovating and expanding. Many infrastructure projects are underway as well, which impacts opportunities for new business and urban development.
Technical consulting services are early cyclical. The demand for these services since the beginning of the year has increased.
Net sales
Third quarter
Net sales for the quarter amounted to SEK 2,166 (2,213) million, which is an increase of SEK 47 million. Organic growth amounted to -3.0 percent and acquired growth was 1.0 percent.
January – September
Net sales for the period amounted to SEK 6,964 (7,259) million, which is an increase of SEK 295 million. Organic growth amounted to -5.9 percent and acquired growth was 2.4 percent.
Order backlog
Order backlog at the end of the period amounted to SEK 6,429 (6,682) million, which is a decrease of -3.8 percent. Organically, for comparable units, order backlog decreased by -4.0 percent. The order backlog of acquired companies contributed with growth of 0.2 percent.
For example, during the quarter, the Instalco company Enter Ställningar signed a multi-year agreement with Sysav (Sydvkåne Waste Company) for ongoing scaffolding assembly. The contract, with an order value of approximately SEK 130 million, runs from autumn 2024 until 2032.
Earnings
Third quarter
EBITA for the quarter was SEK 119 (177) million, which corresponds to an EBITA margin of 5.5 (8.0) percent which is primarily attributable to the prevailing market situation. Operating profit/loss was SEK 103 (152) million.
January – September
EBITA for the period amounted to SEK 478 (586) million, which corresponds to a EBITA margin of 6.9 (8.1) percent. Operating profit/loss was SEK 427 (513) million.
Key figures for Sweden
| AMOUNTS IN SEK M | Jul-Sep 2024 |
Jul-Sep 2023 |
∆% | Jan-Sep 2024 |
Jan-Sep 2023 |
∆% | Rullande 12 months |
Jan-Dec 2023 |
|---|---|---|---|---|---|---|---|---|
| Net sales | 2,166 | 2,213 | -2.1 | 6,964 | 7,259 | -4.1 | 9,668 | 9,962 |
| EBITA | 119 | 177 | -32.8 | 478 | 586 | -18.4 | 725 | 833 |
| EBITA margin, % | 5.5 | 8.0 | 6.9 | 8.1 | 7.5 | 8.4 | ||
| Order backlog | 6,429 | 6,682 | -3.8 | 6,429 | 6,682 | -3.8 | 6,429 | 6,216 |
Market
The market in Norway remains at a relatively high level, particularly in and around the major metropolitan regions. This applies to both new construction and renovation, although slightly more caution is being exhibited when it comes to decisions about project starts. For new production of residential property, we have noticed a continued dampening effect, which has resulted in slightly higher competition for other types of projects. The primary driving forces are continued major investments in the public sector, such as defence, schools and hospitals, along with private initiatives to develop industrial, office and commercial facilities. A higher demand for energy optimisation of existing properties has also been noticed.
Development of the market in Finland has been stable in recent months, albeit at a relatively low level. The interest rate situation has resulted in more cautious behaviour in the construction industry, while other areas, such as service, industrial operations and data cable projects are progressing as planned. More acquisition investments are expected in the construction and infrastructure sectors.
Net sales
Third quarter
Net sales for the quarter amounted to SEK 978 (1,098) million, which is an increase of SEK 120 million. Organic growth, adjusted for currency effects, amounted to -9.0 percent and acquired growth was 2.6 percent.
January – September
Net sales for the period amounted to SEK 3,118 (3,146) million, which is an increase of SEK 28 million. Organic growth, adjusted for currency effects, amounted to -6.8 percent and acquired growth was 7.8 percent.
Order backlog
Order backlog at the end of the period amounted to SEK 2,104 (2,519) million, which is a decrease of -16.5 percent, adjusted for currency effects. Organically, for comparable units, order backlog decreased by -12.7 percent. The acquired order backlog increased by 0.4 percent.
For example, four Instalco subsidiaries were contracted during the quarter on a joint assignment for installations in conjunction with new construction of a building in Vinstra, north of Lillehammer. It will be used as offices for the Swedish Police, along with business premises for the retail chain, Thansen. The assignment is for design, installation and automation of the electrical, ventilation and heating & plumbing solutions. The following four Instalco companies are involved: Haug og Ruud VVS, Bakke El-Installasjon, Istech and Intec.
Earnings
Third quarter
EBITA for the quarter was SEK 68 (68) million, which corresponds to an EBITA margin of 6.9 (6.2) percent. Operating profit/loss was SEK 45 (40) million.
January – September
EBITA for the period was SEK 207 (191) million, which corresponds to an EBITA margin of 6.6 (6.1) percent. Operating profit/loss was SEK 138 (117) million.
Key figures, Rest of Nordics
| AMOUNTS IN SEK M | Jul-Sep 2024 |
Jul-Sep 2023 |
∆% | Jan-Sep 2024 |
Jan-Sep 2023 |
∆% | Rolling 12 months |
Jan-Dec 2023 |
|---|---|---|---|---|---|---|---|---|
| Net sales | 978 | 1,098 | -10.9 | 3,118 | 3,146 | -0.9 | 4,288 | 4,317 |
| EBITA | 68 | 68 | -0.2 | 207 | 191 | 8.6 | 269 | 253 |
| EBITA margin, % | 6.9 | 6.2 | 6.6 | 6.1 | 6.3 | 5.9 | ||
| Order backlog | 2,104 | 2,519 | -16.5 | 2,104 | 2,519 | -16.5 | 2,104 | 2,222 |
Instalco made three acquisitions during the period January through September. Acquisition costs for the period amount to SEK 1 (7) million and they are reported among Other operating expenses in the income statement.
Instalco typically applies an acquisition structure that consists of the purchase price and contingent consideration. Payment of contingent consideration is based on future results. Companies that achieve higher profits over a specified period of time will thus be paid a higher amount of contingent consideration. Contingent consideration is paid within three years of the acquisition date and there is a fixed maximum level.
In accordance with IFRS, contingent consideration has been measured at fair value. It is classified in Level 3 of the fair value hierarchy and reported under Non-current liabilities and Other current liabilities in the balance sheet. At the end of the period, the Group's estimated total amount of contingent consideration was SEK 194 million, of which SEK 15 million is for acquisitions made in 2024.
Changes in reported contingent consideration
| Jan-Sep | Jan-Dec | |
|---|---|---|
| AMOUNTS IN SEK M | 2024 | 2023 |
| Opening carrying amounts | 349 | 454 |
| Revaluation of contingent | ||
| consideration | -20 | 23 |
| Paid contingent consideration | -151 | -215 |
| Added through acquistions made | 15 | 89 |
| during the period | ||
| Exchange rate difference | 1 | -2 |
| Closing carrying amounts | 194 | 349 |
The maximum, non-discounted amount that could be paid to prior owners is SEK 438 million, of which SEK 23 million pertains to acquisitions that were made in 2024.
Revaluation of contingent consideration had a net impact on the period of SEK 20 (10) million, which is reported in Other operating income in the income statement.
The Group's goodwill stems from continuous, goal-oriented acquisition efforts over a period of many years. The amount allocated to goodwill on the acquisition date corresponds to the cost of acquisition less the fair value of the acquired net assets. The value of goodwill is motivated by the earnings capacity of our companies and it represents the future economic benefits of collaboration between subsidiaries, cross-selling and joint purchasing. The benefits have not, however, been individually identified or reported separately. Equity at the end of the period, the Groups total goodwill amounted to SEK 5,304 (5,378) million. Consolidated goodwill is tested each year for impairment by looking at each cashgenerating unit. No impairment of goodwill was necessary during the period. Other identified goodwill, such as customer relations and the order backlog, have been measured at present value of future cash flows and as a rule, is amortised over a period of 3 to 10 years.
Instalco's acquired net sales over the last 12-month period (RTM), in accordance with the assessed situation on the acquisition date, amounted to SEK 166 million.
Company acquisitions
Instalco made the following company acquisitions during the period January – September 2024.
| Share of the | ||||||
|---|---|---|---|---|---|---|
| Area of | votes and | Net sales, SEK | Number of | |||
| Access gained | Acquisition | technology | Segment | capital | million¹ | employees |
| March | Lund Elektro AS | Electrical | Rest of Nordics | 100% | 15 | 9 |
| August | IT-Line Service Oy | Industry | Rest of Nordics | 100% | 40 | 33 |
| Add-on acquisition |
||||||
| February | Solyx AB | Electrical | Sweden | 70% | 14 | 5 |
| Total | 69 | 47 |
1 Pertains to the assessed annual sales on the acquisition date, based on the most recent financial year that was subject to audit.
Impact of acquisitions
Acquisitions had the following impact on the Group's assets and liabilities. None of the acquisitions in the period have been assessed as individually significant, which is why the disclosures cover them as a whole. The acquisition analyses for companies acquired in 2024 are preliminary. Instalco regards the calculations as preliminary until final figures pertaining to the acquired companies have been received.
AMOUNTS IN SEK M
| Intangible assets | 15 |
|---|---|
| Deferred tax asset | - |
| Other non-current assets | 2 |
| Other current assets | 13 |
| Cash and cash equivalents | 24 |
| Deferred tax asset | -0 |
| Other liabilities | -4 |
| Total identifiable assets and liabilities (net) | 50 |
| Goodwill | 34 |
| Consideration paid | |
| Cash and cash equivalents | 65 |
| Contingent consideration including settlement via issue in kind | 10 |
| Total transferred consideration | 74 |
| Impact on cash and cash equivalents Cash consideration paid |
65 |
| Cash and cash equivalents of the acquired units | -24 |
| Total impact on cash and cash equivalents | 41 |
| Settled contingent consideration attributable to acquisitions in the current year and prior years | 151 |
| Exchange rate difference | 4 |
| Total impact on cash and cash equivalents | 196 |
| Impact after the acquisition date included in the Instalco Group's net sales and operating profit/loss |
|
| Net sales | 12 |
| Operating profit (EBIT) | 2 |
| Impact on net sales and operation profit/loss until the acquisition date if the acquisitions had been completed on 1 January 2024 |
|
| Net sales | 24 |
| Operating profit (EBIT) | 3 |
Financial position
Equity at the end of the period amounted to SEK 3,339 (3,329) million, with an equity ratio of 32.0 (30.9) percent.
Cash and cash equivalents, together with its other shortterm investments amounted to SEK 122 (106) million at the end of the period.
Interest-bearing debt including leasing at the end of the period amounted to SEK 3,914 (3,705) million, of which leasing amounts to SEK 663 (640) million.
As of the end of the period, Instalco's total credit line, including unutilised credit, amounted to a total of SEK 3,850 (3,950) million, of which SEK 3,050 (2,950) million had been utilised. As of the end of the quarter, the Group was meeting the stated covenants with a good margin.
Interest-bearing net debt at the end of the period amounted to SEK 3,793 (3,599) million, with a gearing ratio of 119.6 (114.8) percent. Net debt in relation to EBITDA was 2.7 (2.6) times, which is somewhat higher than the target that it should not exceed 2.5 times. Currency changes impacted interest-bearing net debt by SEK 10 (5) million.
Investments, depreciation and amortisation
Investments in company acquisitions amounted to SEK 196 (1,089) million during the period. The amount includes settled contingent consideration attributable to acquisitions made in the current and prior years equal to SEK 151 (184) million.
Net investments in fixed assets for the period amounted to SEK 82 (86) million.
Depreciation/amortisation of property, plant and equipment and intangible assets amounted to SEK 413 (382) million, of which SEK 293 (235) million was depreciation of PPE and SEK 120 (147) million was amortisation of acquired intangible assets.
Seasonal variations
The company's revenue, profitability and cash flow are impacted by seasonal variations and holidays, which limits comparability of the various interim periods. Instalco reports its revenue based on the percentage of completion of its projects. Accordingly, in periods with fewer workdays, the revenue of ongoing projects decreases. For example, sales and profitability during the first and third quarters of the year are impacted by the summer vacation period and lower level of activity. The industrial business area also tends to have its lowest level of activity during the first quarter, which is another reason why sales are lower in the quarter.
The second quarter coincides with spring and early summer, when there is a higher level of activity than what typically occurs in the first quarter. The highest earnings tend to come in the fourth quarter, when many projects are completed.
Share Information
At the end of the period, the number of shares and votes in Instalco AB amounted to 264,107,025.
Instalco's ten largest shareholders, 2024-09-30
| 1 Per Sjöstrand | 22,957,835 | 8.7% |
|---|---|---|
| 2 Capital Group | 20,392,279 | 7.7% |
| 3 AMF Pension & Fonder | 15,200,125 | 5.8% |
| 4 Swedbank Robur Fonder | 13,487,037 | 5.1% |
| 5 Cliens Fonder | 13,465,978 | 5.1% |
| 6 Wipunen varainhallinta OY | 13,100,000 | 5.0% |
| 7 Heikintorppa Oy | 12,800,000 | 4.9% |
| 8 SEB Fonder | 12,229,913 | 4.6% |
| 9 ODIN Fonder | 11,755,515 | 4.5% |
| 10 Första AP-fonden | 11,270,356 | 4.3% |
| Total, ten largest shareholders | 146,659,038 | 55.6% |
| Other | 117,447,987 | 44.5% |
| Total | 264,107,025 | 100.0% |
The ten largest known shareholders (grouped) of Instalco AB as of 30 September 2024. Source: Monitor by Modular Finance AB. Compiled and processed data from Euroclear, Morningstar and FI.
Outstanding share-related incentive programmes
Instalco has three outstanding warrants scheme corresponding to a total of 7,300,000 shares that are directed at the expanded Group management team, CEOs of subsidiaries and other key individuals of the Group. The warrants have been transferred on market terms at a price that was established based on an estimated market value using the Black & Scholes valuation model calculated by an independent valuation institute. Conditions for subscription price per share in the programmes correspond to 115 percent of the volume-weighted average price during the period of five trading days after each AGM.
| Percentage of | Redemption | |||||
|---|---|---|---|---|---|---|
| Outstanding | Number of | Corresponding | the total number | rate per | ||
| programme | options | number of shares | of shares | Price per option | option | Redemption period |
| 2022/2025 | 2,600,000 | 2,600,000 | 1.0% | SEK 7.8 | SEK 50.92 | 22 May 2025 - 16 June 2025 |
| 2023/2026 | 2,350,000 | 2,350,000 | 0.9% | SEK 2,09/SEK 7,27 | SEK 64.90 | 22 May 2026 - 16 June 2026 |
| 2024/2027 | 2,350,000 | 2,350,000 | 0.9% | SEK 7.74 | SEK 44.32 | 24 May 2027 - 18 June 2027 |
Parent Company
The main operations of Instalco AB are head office activities like group-wide management and administration, along with finance and accounting. The comments below pertain to the period 1 January through 30 September 2024. Net sales for the Parent Company amounted to SEK 15 (24) million. Operating profit/loss was SEK -2 (-2) million. Net financial items amounted to SEK 49 (170) million. Earnings before taxes were SEK 46 (169) million and earnings for the period were SEK 46 (169) million. Cash and cash equivalents at the end of the period amounted to SEK 4 (7) million.
Transactions with related parties
Besides remuneration to senior executives, there were no transactions between Instalco and related parties that had a significant impact on the company's financial position or earnings during the period.
Risks and uncertainties
The Instalco Group is active in the Nordic market and it has a decentralised structure whereby each unit runs its own operations, with a large number of customers and suppliers. The business model limits the aggregated business and financial risks.
Instalco's earnings and financial position, as well as its strategic position, are affected by a number of internal factors that Instalco has control over, as well as a number of external factors where the ability to impact the outcome is limited. The most significant risk factors are the state of economy and market situation, including inflation and interest rates, along with structural changes and competition, which impact the demand for new construction of homes and offices, as well as investments from the public sector and industry. The demand for service and maintenance work is less impacted by these risk factors.
Ongoing geopolitical conflicts do not currently have a direct impact on Instalco's sales or purchases. The indirect effects, such as disturbance in logistics chains and rising prices for raw materials that are not possible to compensate for in our own
contracts, could however impact some of the subsidiaries in the Group. We are monitoring developments carefully, but it is currently difficult to assess what future consequences these conflicts could have on the market and economy.
For more information, please see the section on Risks (pages 50-52) in the 2023 Annual Report.
The Parent Company is indirectly impacted by the aforementioned risks and uncertainties via its function in the Group.
Accounting policies
The interim report has been prepared in accordance with IFRS that have been adopted by the EU, with the application of IAS 34 Interim Financial Reporting. Disclosures as per IAS 34.16A are provided in the financial statements, notes and other parts of the interim report. The interim report for the Parent Company has been prepared in accordance with the Annual Accounts Act and the Swedish Securities Market Act, which is in accordance with RFR 2 Accounting for Legal Entities. The same accounting policies and bases of computation have been applied in this interim report as in the most recent annual report. New and revised IFRS and IFRIC pronouncements applicable as of the 2024 financial year have not had any significant impact on the consolidated financial statements.
Fair value of financial instruments
The amount of contingent consideration that could be paid out to prior owners is classified in Level 3 of the fair value hierarchy and it is valued at fair value through profit or loss. More information on additional consideration is provided in the section on acquisitions. The fair value of other financial assets and liabilities does not differ significantly from the carrying amounts.
Events after the end of the reporting period Nothing to report.
| AMOUNTS IN SEK M | Jul-Sep 2024 |
Jul-Sep 2023 |
Jan-Sep 2024 |
Jan-Sep 2023 |
Rolling 12 months |
Full-year 2023 |
|---|---|---|---|---|---|---|
| Net sales | 3,144 | 3,310 | 10,082 | 10,406 | 13,956 | 14,279 |
| Other operating revenue | 20 | 30 | 97 | 93 | 121 | 117 |
| Operating income | 3,164 | 3,340 | 10,180 | 10,498 | 14,077 | 14,396 |
| Materials and purchased services | -1,568 | -1,711 | -4,817 | -5,347 | -6,684 | -7,215 |
| Other external services | -246 | -261 | -814 | -785 | -1,099 | -1,069 |
| Personnel costs | -1,053 | -1,036 | -3,565 | -3,335 | -4,903 | -4,673 |
| Depriciation/amortisation and impairment of property, plant and equipment and intangible assets |
-148 | -133 | -413 | -382 | -548 | -517 |
| Other operating expenses | -1 | -5 | -7 | -21 | -9 | -23 |
| Operating costs | -3,015 | -3,146 | -9,616 | -9,871 | -13,243 | -13,497 |
| Operating profit (EBIT) | 149 | 194 | 563 | 628 | 834 | 899 |
| Net financial items | -43 | -15 | -150 | -75 | -181 | -107 |
| Profit/loss before tax | 106 | 179 | 414 | 553 | 653 | 792 |
| Tax on profit for the year | -18 | -38 | -84 | -114 | -147 | -177 |
| Profit/loss for the period | 88 | 142 | 329 | 439 | 506 | 615 |
| Other comprehensive income | ||||||
| Exchange rate difference when translating subsidiaries abroad | -67 | -14 | -23 | -13 | -128 | -118 |
| Comprehensive income for the period | 21 | 127 | 307 | 425 | 378 | 496 |
| Comprehensive income for the period attributable to: | ||||||
| Parent Company's shareholders | 18 | 122 | 285 | 401 | 367 | 483 |
| Non-controlling interests | 3 | 5 | 21 | 25 | 10 | 14 |
| Earnings per share for the period, before dilution, SEK | 0.32 | 0.52 | 1.17 | 1.58 | 1.87 | 2.29 |
| Earnings per share for the period, after dilution, SEK | 0.32 | 0.52 | 1.17 | 1.56 | 1.87 | 2.26 |
| Average number of shares before dilution¹ | 264,107,025 | 263,996,442 | 264,107,025 | 262,016,921 | 264,107,025 | 262,539,447 |
| Average number of shares after dilution¹ | 264,107,025 | 263,996,442 | 264,107,025 | 265,399,015 | 264,107,025 | 265,726,017 |
Instalco has three outstanding warrants schemes corresponding to a total of 7,300,000 shares.
| AMOUNTS IN SEK M | 30 Sep 2024 |
30 Sep 2023 |
31 Dec 2023 |
|---|---|---|---|
| ASSETS | |||
| Goodwill | 5,304 | 5,378 | 5,288 |
| Right of use asset | 688 | 661 | 762 |
| Other non-current assets | 953 | 1,100 | 1,039 |
| Total non-current assets | 6,944 | 7,139 | 7,089 |
| Accounts receivable | 1,971 | 2,029 | 2,091 |
| Contract assets | 814 | 885 | 628 |
| Other current assets | 575 | 616 | 641 |
| Cash and cash equivalents | 122 | 106 | 267 |
| Total current assets | 3,482 | 3,636 | 3,627 |
| TOTAL ASSETS | 10,426 | 10,775 | 10,716 |
| TOTAL EQUITY | |||
| Equity | 3,172 | 3,136 | 3,207 |
| Non-controlling interests | 167 | 193 | 183 |
| Total equity | 3,339 | 3,329 | 3,390 |
| Non-current liabilities | 3,484 | 3,579 | 3,520 |
| Lease liabilities | 405 | 433 | 507 |
| Total non-current liabilities | 3,889 | 4,013 | 4,028 |
| Lease liabilities | 259 | 207 | 232 |
| Trade payables | 1,100 | 1,279 | 1,052 |
| Contract liabilities | 504 | 590 | 549 |
| Other current liabilities | 1,336 | 1,357 | 1,466 |
| Total current liabilities | 3,198 | 3,434 | 3,298 |
| Total liabilities | 7,087 | 7,446 | 7,326 |
| TOTAL EQUITY AND LIABILITIES | 10,426 | 10,775 | 10,716 |
| Of which interest-bearing liabilities | 3,914 | 3,705 | 3,728 |
| Equity attributable to: | |||
| Parent Company shareholders | 3,172 | 3,136 | 3,207 |
| Non-controlling interests | 167 | 193 | 183 |
| profit or loss Other Non Share contributed Translation incl.profit (loss) controlling capital capital for the year Total interests Total equity AMOUNTS IN SEK M reserve Opening balance 2024-01-01 1 1,126 -1 2,080 3,207 183 3,390 Profit/loss for the period 308 308 21 329 - - - Translation effect for the period fo foreign operations -23 -23 -24 -1 - - - Comprehensive income for the period -23 308 285 20 305 - - Transactions with owners Dividends -179 -179 -179 - - - - Change in non-controlling interests -151 -151 -36 -187 - - - Change in warrants 10 10 10 - - - - Total transactions with owners -321 -321 -36 -357 - - - Closing balance 2024-09-30 1 1,126 -24 2,068 3,172 167 3,339 Opening balance 2023-01-01 1 996 117 1,830 2,944 208 3,152 Profit/loss for the period 414 414 25 439 - - - Translation effect for the period fo foreign operations -13 -13 0 -13 - - - Comprehensive income for the period -13 414 401 25 425 - - Transactions with owners New issues 0 130 130 130 - - - Dividends -172 -172 -172 - - - - Change in non-controlling interests -146 -146 -39 -185 - - - Change in warrants -21 -21 -21 - - - - Total transactions with owners 0 130 -339 -210 -39 -249 - Closing balance 2023-09-30 1,126 104 1,905 3,136 193 3,329 1 |
Accumulated | ||||
|---|---|---|---|---|---|
| AMOUNTS IN SEK M | Jul-Sep 2024 |
Jul-Sep 2023 |
Jan-Sep 2024 |
Jan-Sep | Rolling 2023 12 months |
Full-year 2023 |
|---|---|---|---|---|---|---|
| Cash flow from operating activities | ||||||
| Profit/loss before tax | 106 | 179 | 414 | 553 | 653 | 792 |
| Adjustments for non-cash items | 166 | 99 | 434 | 345 | 534 | 445 |
| Tax paid | -67 | -76 | -195 | -189 | -197 | -191 |
| Changes in working capital | -86 | -83 | -178 | -141 | -83 | -47 |
| Cash flow from operating activities | 119 | 119 | 475 | 567 | 907 | 999 |
| Investing activities | ||||||
| Acquisition and divestment of subsidiaries and businesses | -33 | -222 | -196 | -1,089 | -296 | -1,188 |
| Other | -54 | -35 | -82 | -86 | -97 | -102 |
| Cash flow from investing activities | -87 | -256 | -278 | -1,176 | -393 | -1,288 |
| Financing activities | ||||||
| New issue | - | 31 | 0 | 80 | 0 | 80 |
| Warrants | -0 | -21 | 10 | -21 | 10 | -21 |
| Acquisition of non-controlling interests | -92 | - | -200 | - | -200 | - |
| Dividends | - | - | -179 | -172 | -179 | -172 |
| Net change of loan | 263 | 67 | 264 | 385 | 167 | 289 |
| Amortisation leasing | -87 | -63 | -232 | -186 | -306 | -260 |
| Cash flow from financing activities | 84 | 14 | -338 | 86 | -508 | -85 |
| Cash flow for the period | 116 | -123 | -142 | -524 | 7 | -375 |
| Cash and cash equivalents at the beginning of the period | 17 | 230 | 267 | 631 | 106 | 631 |
| Translation differences in cash and cash equivalents | -12 | -1 | -4 | -2 | 9 | 11 |
| Cash and cash equivalents at the end of the period | 122 | 106 | 122 | 106 | 122 | 267 |
| AMOUNTS IN SEK M | Jul-Sep 2024 |
Jul-Sep 2023 |
Jan-Sep 2024 |
Jan-Sep | Rolling 2023 12 months |
Full-year 2023 |
|---|---|---|---|---|---|---|
| Net sales | 4 | 7 | 15 | 24 | 23 | 32 |
| Operating costs | -5 | -8 | -17 | -26 | -26 | -36 |
| Operating profit (EBIT) | -1 | -1 | -2 | -2 | -4 | -3 |
| Net financial items | -2 | -2 | 49 | 170 | 46 | 168 |
| Profit/loss after net financial items | -3 | -3 | 46 | 169 | 42 | 165 |
| Group contribution received | - | - | - | - | 9 | 9 |
| Profit/loss before tax | -3 | -3 | 46 | 169 | 51 | 174 |
| Income tax | - | - | - | - | 1 | 1 |
| Profit/loss for the period | -3 | -3 | 46 | 169 | 52 | 174 |
| AMOUNTS IN SEK M | 30 Sep 2024 |
30 Sep 2023 |
31 Dec 2023 |
|---|---|---|---|
| Assets | |||
| Financial assets | 1,375 | 1,375 | 1,375 |
| Deferred tax asset | 2 | - | 2 |
| Total non-current assets | 1,377 | 1,375 | 1,377 |
| Other current assets | 8 | 117 | 109 |
| Cash and cash equivalents | 4 | 7 | 37 |
| Total current assets | 12 | 123 | 146 |
| TOTAL ASSETS | 1,388 | 1,498 | 1,523 |
| EQUITY AND LIABILITIES | |||
| Equity | 1,238 | 1,345 | 1,361 |
| Total equity | 1,238 | 1,345 | 1,361 |
| Non-current liabilities | 144 | 146 | 146 |
| Current liabilities | 6 | 7 | 15 |
| Total liabilities | 151 | 153 | 162 |
| TOTAL EQUITY AND LIABILITIES | 1,388 | 1,498 | 1,523 |
| AMOUNTS IN SEK M Income statement |
Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 |
|---|---|---|---|---|---|---|---|---|
| Net sales | ||||||||
| Growth in net sales, % | 3,144 -5.0 |
3,656 -4.6 |
3,283 0.6 |
3,873 7.9 |
3,310 18.7 |
3,832 23.5 |
3,264 26.4 |
3,590 35.6 |
| EBITDA | 297 | 359 | 321 | 406 | 327 | 381 | 302 | 364 |
| EBITDA margin, % | 9.4 | 9.8 | 9.8 | 10.5 | 9.9 | 10.0 | 9.2 | 10.2 |
| EBITA | 188 | 265 | 231 | 310 | 246 | 296 | 233 | 292 |
| EBITA margin, % | 6.0 | 7.2 | 7.0 | 8.0 | 7.4 | 7.7 | 7.1 | 8.1 |
| Operating profit (EBIT) | 149 | 224 | 190 | 271 | 194 | 244 | 190 | 261 |
| Operating profit/loss (EBIT), % | 4.7 | 6.1 | 5.8 | 7.0 | 5.9 | 6.4 | 5.8 | 7.3 |
| Profit/loss before tax | 106 | 170 | 138 | 239 | 179 | 202 | 171 | 230 |
| Profit/loss for the period | 88 | 131 | 111 | 176 | 142 | 162 | 135 | 182 |
| Equity, provisions and liabilities | ||||||||
| Return on equity, % | 15.7 | 17.4 | 18.4 | 19.6 | 20.3 | 18.8 | 20.6 | 20.1 |
| Return on capital employed, % | 12.5 | 12.7 | 13.0 | 14.1 | 13.9 | 13.3 | 13.3 | 14.9 |
| Interest-bearing net debt | 3,793 | 3,695 | 3,419 | 3,461 | 3,599 | 3,372 | 3,107 | 2,503 |
| Gearing ratio, % | 119.6 | 116.6 | 102.2 | 107.9 | 114.8 | 107.6 | 101.9 | 85.0 |
| Net debt/EBITDA, times | 2.7 | 2.6 | 2.4 | 2.4 | 2.6 | 2.5 | 2.5 | 2.1 |
| Key financial performance indicatiors | ||||||||
| Working capital | 443 | 518 | 360 | 322 | 325 | 370 | 268 | 341 |
| Equity ratio, % | 32.0 | 31.6 | 33.9 | 31.6 | 30.9 | 31.2 | 30.0 | 32.9 |
| Cash conversion (rolling 12 months), % | 87 | 89 | 91 | 90 | 88 | 81 | 82 | 85 |
| Cash flow from operating activities | 119 | 158 | 198 | 432 | 119 | 225 | 222 | 376 |
| Order backlog | ||||||||
| Order backlog | 8,533 | 9,058 | 8,921 | 8,437 | 9,201 | 9,185 | 8,987 | 8,376 |
| Key figures, employees | ||||||||
| Average number of employees | 6,126 | 6,144 | 6,188 | 6,237 | 6,076 | 5,474 | 5,453 | 5,431 |
| Number of employees at the end of the period | 6,208 | 6,233 | 6,224 | 6,282 | 6,228 | 6,183 | 6,023 | 5,611 |
| Acquisition-related items | ||||||||
| Revaluation of contingent consideration | 10 | 5 | 4 | 14 | 5 | 6 | -1 | 11 |
| Acquisition costs | -1 | -0 | -0 | -2 | -1 | -3 | -4 | -2 |
| Total acquisition-related items | 10 | 5 | 4 | 12 | 4 | 3 | -4 | 9 |
| Key figures per share SEK | ||||||||
| Average number of shares before dilution | 264,107,025 | 264,107,025 | 264,107,025 | 264,107,025 | 263,996,442 | 261,520,302 | 260,564,020 | 260,564,020 |
| Average number of shares after dilution | 264,107,025 | 264,107,025 | 264,107,025 | 264,107,025 | 263,996,442 | 264,120,302 | 265,510,300 | 265,510,300 |
| Profit/loss for the period attributable to the Parent | ||||||||
| Company´s shareholders, SEK million Earnings per share for the period before dilution, |
85 | 124 | 99 | 187 | 137 | 152 | 126 | 175 |
| SEK | 0.32 | 0.47 | 0.37 | 0.71 | 0.52 | 0.58 | 0.48 | 0.67 |
| Earnings per share for the period after dilution, SEK | 0.32 | 0.47 | 0.37 | 0.71 | 0.52 | 0.58 | 0.47 | 0.66 |
| Cash flow from operating activities per share, SEK | 0.45 | 0.60 | 0.75 | 1.64 | 0.45 | 0.85 | 0.84 | 1.42 |
| Equity per share, SEK | 12.01 | 11.99 | 12.67 | 12.13 | 11.89 | 11.92 | 11.48 | 11.09 |
| Share price at the end of the period, SEK | 41.00 | 40.56 | 42.28 | 40.90 | 32.50 | 53.85 | 49.98 | 39.63 |
Reconciliation of key figures not defined in accordance with IFRS
The Company presents certain financial measures in the interim report, which are not defined under IFRS. The Company believes that these measures provide useful supplemental information to investors and the company's management, since they allow for the evaluation relevant trends. Instalco's definitions of these measures may differ from other companies using the same terms. These financial measures should therefore be viewed as a supplement, rather than as a replacement for measures defined under IFRS. Presented below are definitions of measures that are not defined under IFRS and which are not mentioned elsewhere in the interim report. Reconciliation of these measures is provided in the table, below. For definitions of key figures, see instalco.se.
Earnings measures and margin measures
| AMOUNTS IN SEK M | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 |
|---|---|---|---|---|---|---|---|---|
| (A) Net sales | 3,144 | 3,656 | 3,283 | 3,873 | 3,310 | 3,832 | 3,264 | 3,590 |
| (B) EBITDA | 297 | 359 | 321 | 406 | 327 | 381 | 302 | 364 |
| Depreciation/amortisation and | ||||||||
| impairment of property, plant and | ||||||||
| equipment and intangible assets | ||||||||
| (not acquired) | -109 | -95 | -90 | -96 | -81 | -85 | -69 | -72 |
| (C) EBITA | 188 | 265 | 231 | 310 | 246 | 296 | 233 | 292 |
| Depreciation/amortisation and | ||||||||
| impairment of acquired intangible | ||||||||
| assets | -39 | -41 | -40 | -39 | -52 | -52 | -43 | -31 |
| (D) Operating profit/loss (EBIT) | 149 | 224 | 190 | 271 | 194 | 244 | 190 | 261 |
| (B/A) EBITDA margin, % | 9.4 | 9.8 | 9.8 | 10.5 | 9.9 | 10.0 | 9.2 | 10.2 |
| (C/A) EBITA margin, % | 6.0 | 7.2 | 7.0 | 8.0 | 7.4 | 7.7 | 7.1 | 8.1 |
| (D/A) Operating profit/loss, (EBIT), % | 4.7 | 6.1 | 5.8 | 7.0 | 5.9 | 6.4 | 5.8 | 7.3 |
Capital structure
| AMOUNTS IN SEK M | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 |
|---|---|---|---|---|---|---|---|---|
| Calculation of working capital and | ||||||||
| working capital in relation to net sales | ||||||||
| Inventories | 207 | 212 | 213 | 202 | 187 | 185 | 173 | 159 |
| Accounts receivable | 1,971 | 2,076 | 1,906 | 2,091 | 2,029 | 2,041 | 1,835 | 1,891 |
| Contract assets | 814 | 768 | 774 | 628 | 885 | 915 | 901 | 619 |
| Prepaid expenses and accrued income | 206 | 234 | 199 | 271 | 255 | 166 | 148 | 158 |
| Other current assets | 162 | 176 | 246 | 168 | 173 | 178 | 230 | 177 |
| Trade payables | -1,100 | -1,088 | -1,065 | -1,052 | -1,279 | -1,172 | -1,201 | -1,042 |
| Contract liabilities | -504 | -532 | -512 | -549 | -590 | -594 | -590 | -461 |
| Other current liabilities | -612 | -515 | -526 | -642 | -652 | -558 | -430 | -473 |
| Accrued expenses and deferred income, | ||||||||
| including provisions | -701 | -814 | -875 | -795 | -684 | -791 | -798 | -687 |
| (A) Working capital | 443 | 518 | 360 | 322 | 325 | 370 | 268 | 341 |
| (B) Net sales (12-months rolling) | 13,956 | 14,122 | 14,298 | 14,279 | 13,996 | 13,474 | 12,744 | 12,063 |
| (A/B) Working capital as a percentage of | ||||||||
| net sales, % | 3.2 | 3.7 | 2.5 | 2.3 | 2.3 | 2.7 | 2.1 | 2.8 |
| AMOUNTS IN SEK M | Q3 2024 | Q2 2024 | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 |
|---|---|---|---|---|---|---|---|---|
| Calculation of interest-bearing net debt | ||||||||
| and gearing ratio | ||||||||
| Non-current, interest-bearing financial liabilities |
||||||||
| 3,496 | 3,465 | 3,155 | 3,492 | 3,412 | 3,399 | 3,589 | 2,950 | |
| Current, interest-bearing financial liabilities | 420 | 247 | 344 | 236 | 293 | 203 | 189 | 185 |
| Cash and cash equivalents | -122 | -17 | -80 | -267 | -106 | -230 | -672 | -631 |
| (C) Interest-bearing net debt | 3,793 | 3,695 | 3,419 | 3,461 | 3,599 | 3,372 | 3,107 | 2,503 |
| (D) Equity | 3,172 | 3,167 | 3,347 | 3,207 | 3,136 | 3,133 | 3,049 | 2,944 |
| (C/D) Gearing ratio, % | 119.6 | 116.6 | 102.2 | 107.9 | 114.8 | 107.6 | 101.9 | 85.0 |
| (E) EBITDA (12-months rolling) | 1,382 | 1,413 | 1,435 | 1,416 | 1,375 | 1,322 | 1,244 | 1,165 |
| (C/E) Interest-bearing net debt in relation | ||||||||
| to EBITDA (12-months rolling) | 2.7x | 2.6x | 2.4x | 2.4x | 2.6x | 2.5x | 2.5x | 2.1x |
| Calculation of operating cash flow and | ||||||||
| cash conversion (12-months rolling) | ||||||||
| (F) EBITDA Net investments in property, plant and |
1,382 | 1,413 | 1,435 | 1,416 | 1,375 | 1,322 | 1,244 | 1,165 |
| equipment and intangible assets | -97 | -78 | -78 | -102 | -91 | -76 | -52 | -37 |
| Changes in working capital | -83 | -80 | -46 | -47 | -80 | -172 | -177 | -137 |
| (G) Operation cash flow (12-months | ||||||||
| rolling) | 1,202 | 1,255 | 1,311 | 1,267 | 1,204 | 1,074 | 1,015 | 991 |
| (G/F) Cash conversion % (12-months | ||||||||
| rolling) | 87 | 89 | 91 | 90 | 88 | 81 | 82 | 85 |
| (H) Earnings for the period (12-months | ||||||||
| rolling) | 506 | 559 | 590 | 615 | 621 | 557 | 585 | 551 |
| (H/D) Return on equity, % | 15.7 | 17.4 | 18.4 | 19.6 | 20.3 | 18.8 | 20.6 | 20.1 |
| (I) EBIT | 149 | 224 | 190 | 271 | 194 | 244 | 190 | 261 |
| (J) Financial income | 10 | 15 | 13 | 93 | 63 | 27 | 17 | 38 |
| (K) Total assets | 10,426 | 10,521 | 10,472 | 10,716 | 10,775 | 10,762 | 10,854 | 9,573 |
| (L) Interest-free liabilities | 3,171 | 3,480 | 3,423 | 3,598 | 3,741 | 3,800 | 3,809 | 3,286 |
| (I+J)/(K-L) Return on capital employed, % | 12.5 | 12.7 | 13.0 | 14.1 | 13.9 | 13.3 | 13.3 | 14.9 |
Future reporting dates
Year-end report 2024 13 February 2025 Interim report January – March 2025 29 April 2025 AGM 2025 6 May 2025 Interim report January – June 2025 18 July 2025 Interim Report January – September 2025 24 October 2025
Board of Directors' assurance
The Board of Directors and CEO ensure that this interim report provides a fair view of the company's and the Group's operations, position and earnings, and describes significant risks and uncertainties faced by the company and the companies belonging to the Group.
Stockholm, 25 October 2024 Instalco AB (publ)
| Per Sjöstrand | Camilla Öberg | Carina Qvarngård | Ulf Wretskog |
|---|---|---|---|
| Chairman | Director | Director | Director |
| Per Leopoldsson | Carina Edblad | Johnny Alvarsson | Robin Boheman |
| Director | Director | Director | CEO |
This report has been reviewed by the company's auditors.
Presentation of the report
The report will be presented in a telephone conference/audiocast today, 25 October at 09:30 CET via https://ir.financialhearings.com/instalco-q3-report-2024
To participate by phone, register via https://conference.financialhearings.com/teleconference/?id=50048289
Note
This information is information that Instalco is required to disclose under the EU Market Abuse Regulation. The information was made public by the contact person listed below, on 25 October 2024 at 07:30 CET.
Additional information
Robin Boheman, CEO
Christina Kassberg, CFO, [email protected]
Mathilda Eriksson, Head of IR, [email protected] +46 (0)70-972 34 29
Auditor's report on review of interim financial information in summary (interim report) prepared in accordance with IAS 34 and Chapter 9 of the Swedish Annual Accounts Act (1995:1554)
THIS IS A TRANSLATION FROM THE SWEDISH ORIGINAL
Introduction
We have reviewed the condensed consolidated interim financial information in summary (interim report) of Instalco AB (publ) as of 30 September 2024 and the nine-month period then ended. The Board of Directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different focus and is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and other generally accepted auditing standards. The procedures performed in a review do not enable us to obtain assurance that would make us aware of all significant matters that might be identified in an audit. Therefore, the conclusion expressed based on a review does not give the same level of assurance as a conclusion expressed based on an audit.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed consolidated interim report is not, in all material respects, prepared in accordance with IAS 34 and the Swedish Annual Accounts Act for the Group and the Swedish Annual Accounts Act for the Parent company.
Stockholm, date of digital signature
Grant Thornton Sweden AB
Camilla Nilsson Authorized Public Accountant
Instalco has a decentralised structure, where operations are conducted in each unit, in close cooperation with customers and with the support of a very streamlined central organisation. The Instalco model is designed to benefit from the advantages of both strong local ties and joint functions.
1) Cumulative distribution of net sales for the reporting period