THIRD QUARTER 2017 RESULTS
Christian Nørgaard Madsen, CEO | Anne Harris, CFO
DISCLAIMER
This presentation includes forward-looking statements which are based on our current expectations and projections about future events. All statements other than statements of historical facts included in this presentation, including statements regarding our future financial position, risks and uncertainties related to our business, strategy, capital expenditures, projected costs and our plans and objectives for future operations, including our plans for future costs savings and synergies may be deemed to be forward-looking statements. Words such as "believe," "expect," "anticipate," "may," "assume," "plan," "intend," "will," "should," "estimate," "risk" and similar expressions or the negatives of these expressions are intended to identify forward-looking statements. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. You should not place undue reliance on these forward-looking statements. In addition any forwardlooking statements are made only as of the date of this notice, and we do not intend and do not assume any obligation to update any statements set forth in this presentation.
INTRODUCTION AND HIGHLIGHTS
Christian Nørgaard Madsen, CEO
Highlights
• Third quarter revenue growth of 9.8%, driven by acquisitions
multiconsult.no
- Third quarter earnings impacted by lower billing ratio and negative calendar effect
- Year to date 2017 revenue growth of 11.9%, earnings impacted by lower billing ratio
- Stable order backlog at NOK 2.1 billion
- Hjellnes group acquisition successfully completed
- Consolidated in the balance sheet as of 30 September 2017
3-2-1 GO - comments
- Acquisition of the Hjellnes group a big step towards realisation of strategic ambitions for Norway
- Healthcare, urbanism
- Initiating growth within international renewable energy
- Opening of branch office in Kenya
- Important contracts
- Expanding within healthcare buildings in Scandinavia
- Acquisition of aarhus arkitekterne A/S
- Several important projects won, hospitals in Tønsberg, Helsingborg, Copenhagen
- New ERP system provides a basis for more efficient operations
- Intensified focus on Sweden building on existing presence through LINK arkitektur AB and Iterio AB
Fornebubanen frame agreement award
- Significant and complex transportation project
- New 8.2 kilometers long metro line between Fornebu and Oslo
- An interchange with the existing network at Majorstuen station
- Six new metro stations including associated infrastructure
- Joint Venture agreement between Multiconsult and COWI
- Three-year frame agreement, possible extension up to ten years
- The value of the agreement is significant
- Estimated volume of approx. 970 000 hours including options
Financial summary 3Q and YTD 2017
multiconsult.no
• 3Q 2017
- Net operating revenue up 9.8% y-o-y to NOK 608.8 million
- EBIT of NOK 10.5 million, 1.7% margin
• YTD 2017
- Net operating revenue up 11.9% y-o-y to NOK 2 147.4 million
- Organic growth 4.7%
- Impacted by a lower billing ratio
- EBIT of NOK 120.7 million, 5.6% margin
- Impacted by non-recurring expenses
- Opex increase in line with growth
Key ongoing projects 3Q 2017
- Campus Ås
- Hospital Campus, Helsingborg
- Mount Coffee Hydropower Project
- New Airbase Ørland
- InterCity Haug Halden
Order intake 3Q 2017
Order backlog development per business area
- Order backlog up 27.6% y-o-y to NOK 2 107.9 million
- Order backlog of the Hjellnes group of NOK 153.4 million included in order backlog as of 30 September 2017
- Call-offs on frame agreements only included when signed
- ─ Fornebubanen
- ─ BaneNOR
- ─ NORAD
Organisation
- Integration of the Hjellnes group in progress
- Stanislas Merlet awarded Young Advisor of the year 2017 by RIF
- Multiconsult climbs to #3 at Universum Professionals Survey 2017
- Prestigious buildingSMART International Award for Design 2017 - Tønsberg Hospital
- Silver medal in Farmandprisen for best website 2017
- Stable organisation group employee turnover at 6.4% (5.9%)
FINANCIAL REVIEW
Anne Harris, CFO
Financial highlights 3Q 2017
*Underlying
Financial highlights YTD 2017
- Net operating revenue up 11.9% to NOK 2 147.4 million
- ‒ Organic growth 4.7%
- ‒ Good project execution
- ‒ Billing ratio fell to 68.3%
• EBIT of NOK 120.7 million, a decrease of 26.1%
- Higher employee benefit expenses
- Non-recurring expenses
- including implementation of new ERP system
- EBIT margin at 5.6%
Segments YTD 2017
Greater
Oslo Area |
YTD 2017 |
YTD 2016 |
Change |
| EBIT MNOK |
64.5 |
111.0 |
41.9% |
| EBIT margin % |
7.1% |
12.6% |
5.5 pp |
Billing
ratio |
67.2% |
70.9% |
3.7 pp |
Number
of
employees |
1
187 |
881 |
34.7% |
| Regions Norway |
YTD 2017 |
YTD 2016 |
Change |
| EBIT MNOK |
30.3 |
41.9 |
27.6% |
| EBIT margin % |
4.0% |
5.9% |
1.9
pp |
Billing
ratio |
67.3% |
68.7% |
1.4 pp |
Number
of
employees |
842 |
792 |
6.3% |
| International |
YTD 2017 |
YTD 2016 |
Change |
| EBIT MNOK |
17.1 |
5.0 |
>100% |
| EBIT margin % |
13.1% |
7.5% |
5.6 pp |
Billing
ratio |
72.1% |
63.2% |
8.9
pp |
Number
of
employees |
205 |
124 |
65.3% |
LINK
arkitektur |
YTD 2017 |
YTD 2016 |
Change |
| EBIT MNOK |
11.6 |
6.2 |
88.7% |
| EBIT margin % |
3.4% |
2.4% |
0.9 pp |
Billing
ratio |
71.4% |
69.9% |
1.5 pp |
Number
of
employees |
476 |
343 |
38.8% |
Operating revenues by business area YTD 2017
Cash flows YTD 2017
- Solid cash flow from operations
- Change in working capital driven by
- Increased production
- Increased trade receivables and work in progress
- Investments
- Acquisition of Iterio AB and Hjellnes Group
- Ordinary asset replacement
- Financing
- Increased debt due to acquisitions
- Dividend payment
Outlook
- The overall market outlook remains fairly positive
- Continued strong competition and price pressure on large projects
- Market rates have stabilised in Norway, regional variations
- Increased employee cost in Norway not fully reflected in billing rates
- Stronger combination of professional capability and stable order backlog
- Active and systematic implementation of the 3-2-1 GO strategy
- Intensified focus on improving profitability
| 4Q 2017 results: |
28 Feb
2018 |
| 1Q 2018 results: |
23 May
2018 |
Q&A
THIRD QUARTER 2017 RESULTS | Christian Nørgaard Madsen, CEO Anne Harris, CFO