Earnings Release • Jul 24, 2007
Earnings Release
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Comments from CEO Mats Wäppling:
– SWECO delivered impressive first half earnings with growth of 20 per cent and an increased operating margin of 10.4 per cent.
– Market conditions remain favourable and SWECO is enjoying sustained strong demand in all areas of operation. Projects in Sweden include large-scale assignments in preparation for the planned Citybanan railway line in Stockholm. In addition, a greater focus on climate change is stimulating interest in SWECO's consulting services, above all in the environmental and energy areas.
– The fast-paced development in Eastern and Central Europe has given SWECO a leading position that is growing steadily stronger. Today we have around 800 employees in these markets and a very healthy order intake. Among other things, SWECO recently won a contract to design water and wastewater systems for the Russian city of Petrozavodsk.
– Our ambition is to continue growing with strong profitability, both in the Nordic market and in Eastern and Central Europe. We see no signs of slowing so far and the outlook for the remainder of 2007 is bright.
The SWECO Group's net sales rose by 20 per cent to SEK 2,302.7 million (1,925.5). Of the increase, around 50 per cent consists of organic growth and 50 per cent of acquisition-driven growth.
| Profit summary, SEK M | 2007, 6 mths | 2006, 6 mths |
|---|---|---|
| SWECO Sweden | 155.2 | 130.4 |
| SWECO Grøner − Norway | 36.6 | 29.2 |
| SWECO Finland | 7.3 | 2.9 |
| SWECO Baltic & Eastern Europe | 8.1 | 1.1 |
| SWECO Russia | 0.6 | 1.2 |
| SWECO PIC − Industry | 37.8 | 22.8 |
| Group-wide, etc. | -5.2 | -2.0 |
| Operating profit | 240.4 | 185.6 |
| Consolidated net financial items | -1.8 | 3.8 |
| Profit before tax | 238.6 | 189.4 |
Operating profit reached SEK 240.4 million (185.6), an increase of SEK 54.8 million. The improvement is mainly explained by a continued strong market and the accretive effects of past acquisitions. Operating margin for the Group was 10.4 per cent (9.6). The billing ratio, including all administrative personnel, rose by 0.9 percentage units to 76.0 per cent (75.1).
Profit before tax was SEK 238.6 million (189.4). The Group's net financial items totalled SEK -1.8 million (3.8). The year-earlier figure included a value change of SEK 2.1 million pertaining to the sold shares in AB Ångpanneföreningen.
Profit after tax amounted to SEK 166.4 million (132.7), of which SEK 161.0 million (127.8) is attributable to equity holders in the Parent Company. Profit was charged with a tax rate of 30 per cent (30).
Return on equity was 39.3 per cent (40.1) and return on capital employed was 43.8 per cent (42.8).
There were no related-party transactions with a significant impact on the Group's profit or financial position.
Earnings per share were SEK 1.91 (1.51) before dilution and SEK 1.89 (1.51) after dilution.
Net expenditure on equipment during the period totalled SEK 34.8 million (24.8) and referred primarily to computers and other IT investments. Depreciation of equipment amounted to SEK 28.4 million (23.9).
A sum of SEK 137.7 million (93.2) was invested in the acquisition of associated companies and subsidiaries.
The Group's cash flow from operating activities was SEK 106.6 million (66.3).
Cash and cash equivalents and other current interest-bearing assets amounted to SEK 149.4 million (191.5). Disposable cash and cash equivalents including unutilised bank overdraft facilities at the end of the period totalled SEK 396.1 million (SEK 414.3 million at year-end 2006). Interest-bearing debt is reported at SEK 324.9 million (101.1). The net interest-bearing liabilities thus amounted to SEK 175.5 million (net interest-bearing asset 90.4).
Total capital of SEK 269.6 million (261.8) has been distributed to the shareholders during the year.
The equity/assets ratio at 30 June 2007 was 32.7 per cent (41.0).
The number of employees at 30 June 2007 was 4,905 (3,913). The average number of employees in the Group during the period was 4,606 (3,802).
Net sales were up by 20 per cent over the same period of 2006 and amounted to SEK 1,157.7 million (967.0). Operating profit rose by 42 per cent to SEK 100.0 million (70.3) and operating margin was 8.6 per cent (7.3). The billing ratio was 76.0 (75.8).
The Parent Company reported net sales of SEK 28.9 million (35.8), all of which referred to intra-group services. Profit after net financial items was SEK 17.3 million (5.6). Capital expenditure on equipment amounted to SEK 0.5 million (0.1) and cash and cash equivalents at the end of the period totalled SEK 10.1 million (48.8).
The SWECO share is listed on the OMX Nordic Stock Exchange in Stockholm. The bid price for the SWECO B share at the end of the period was SEK 66, representing a total increase of 29 per cent during the year. The OMX Stockholm General Index rose by 10 per cent over the same period.
The total number of shares during the period was changed through the issuance of 200,000 new class C shares to enable fulfilment of the Share Bonus Programme 2007, a 10-for-1 share split and a share redemption procedure in which every five shares of class A and B were redeemed for a sum of SEK 8.50. The total number of shares thereafter amounts to 86,414,350, consisting of 9,389,075 class A shares, 76,025,275 class B shares and 1,000,000 class C shares. After deduction of treasury shares, the number of shares outstanding at the end of the period was 84,251,350, of which 9,389,075 were class A shares and 74,862,275 were class B shares.
The conditions for SWECO's warrant series 2005/2008 have been recalculated with respect to the share split and share redemption during the second quarter. After recalculation, the exercise price has been adjusted SEK 26.70 from the earlier SEK 151.10 and each warrant grants the right to subscribe for 5.84 shares instead of the earlier 1.03 shares. On full exercise of the warrant series 2005/2008, the number of class B shares will increase by 1,687,760, corresponding to a dilutive effect of 1.9 per cent of the share capital and 1.0 per cent of the votes.
On full utilisation of the 2007 Share Bonus Programme, the equity capital of SWECO AB (publ) will increase by SEK 1,000,000, corresponding to a dilutive effect of 1.1 per cent of the share capital and 0.6 per cent of the votes. Together with the outstanding warrant series 2005/2008, the total dilutive effect amounts to 3.0 per cent of the share capital and 1.6 per cent of the votes.
SWECO holds 1,163,000 repurchased class B shares (treasury shares). The repurchased shares have an average bid price of SEK 22.10, equal to a total of SEK 25.7 million. The market value at the end of the period was SEK 76.8 million. In order to enable delivery of shares to the employees covered by the Share Bonus Programme 2007, SWECO holds 1,000,000 repurchased class C shares. The repurchased shares correspond to 2.5 per cent of the total number of shares and 1.3 per cent of the votes.
Engineers, architects and environmental experts in the SWECO companies are working together to contribute to the development of a sustainable society. With its approximately 4,900 employees, the SWECO Group is among the dominant players in Europe and the market-leader in several segments of the Nordic and Baltic regions. SWECO has subsidiaries in ten countries and projects currently under way in 75 countries worldwide. Operations are conducted in six business units: SWECO Sweden, SWECO Grøner – Norway, SWECO Finland, SWECO Baltic & Eastern Europe, SWECO Russia and SWECO PIC – Industry.
The market is showing sustained growth and no signs of slowing. SWECO is noting robust demand in all areas of operation. A stronger focus on climate change is stimulating interest in SWECO's services, above all in the energy and environmental areas. Market development is expected to remain favourable in the third quarter.
SWECO Sweden is one of the country's leading consulting engineering firms and the Group's largest business unit, with more than 2,400 employees in 44 locations and services in architecture, structural engineering, building service systems, transportation and civil engineering, water and environment, project management, energy systems and geographic information systems. SWECO Sweden has extensive project exports to countries in Eastern Europe, Africa, Asia, the Middle East and Latin America.
Net sales were up by 18 per cent to SEK 1,364.6 million (1,156.7).
Operating profit amounted to SEK 155.2 million (130.4) and operating margin to 11.4 per cent (11.3).
The market for consulting engineering services remains strong in all areas. Rising interest in reducing environmental impact and the growing dependency on electrical energy are placing heavy demands on the adaptability of players in both the public and private sectors. This is generating an increased need for qualified consultants with specific skills, above all in environment and energy. Greater demand for SWECO's services is therefore anticipated in these areas over the next few years.
In the infrastructure sector, order intake remains high with substantial planning and design volumes and a positive investment trend is awaited throughout the remainder of 2007. Activity in the construction sector remains high. The rapid growth rate in residential planning and design is starting to slow, but is being offset by improved order intake for planning and design of offices and other commercial premises.
The market for industrial consulting services is growing steadily. Investments in new plants and process technology in the mining and steelworking industries are generating increased volumes for SWECO.
SWECO has won a contract from the National Road Administration to prepare a work plan for Road 155 in western Sweden, where five kilometres of six-lane highway and two traffic interchanges will be built between Gothenburg and the cities of Torslanda and Öckerö. The road, which currently has four lanes, will be made safer through widening and the addition of concrete barriers.
SWECO's Swedish architects have been commissioned to plan a Russian housing development in Saint Petersburg with a Scandinavian design. The contract is worth around SEK 23 million. The project is focused on sustainable development and energy conservation.
SWECO has been partnered with Grontmij for a large-scale consulting assignment ahead of the planned Citybanan railway line in Stockholm. In total, the contract is worth approximately SEK 100 million. The contracted services include drafting of construction documents, preparation of complete tendering documents, participation in the construction phase and preparation of management data for four large contracting assignments.
SWECO Grøner is one of Norway's largest engineering consultancies with some 550 employees. SWECO Grøner, which also has extensive export operations, is organised in five business areas: Energy, Water & Environment, Building & Construction, Land & Transportation and Building Service Systems.
Net sales improved by 17 per cent to SEK 375.7 million (321.2). Operating profit was reported at SEK 36.6 million (29.2) and operating margin at 9.7 per cent (9.1).
SWECO Grøner is noting sustained strong demand in all of areas of operation and conditions are expected to remain stable throughout the remainder of the year.
Demand in the construction sector remains keen. The rate of housing construction is vigorous and even higher growth is awaited for office and industrial construction. Development in the offshore sector is characterised by robust demand, particularly in planning and design of underwater and steel structures.
In the infrastructure sector, planned investments in the road and railway network are expected to generate strong and steady demand for SWECO's services. Development in the water and environment sector is positive and a rising level of activity is being noted in areas such as environmental management, hydrology and environmental economy. In the energy sector there is an accelerating demand for consulting services in development of wind power, bioenergy and small hydropower plants.
SWECO has been selected for a large-scale assignment on behalf of REC, which is building a new production plant in Porsgrunn, Norway, for manufacturing of silicon wafers for solar applications and a plant in Narvik, Norway, for manufacturing of solar cells and modules. The contract includes planning and design of heating, water and sanitation, electrical systems and automation.
SWECO has been chosen by Sargas AS for preconstruction planning of Norway's first coal power plant with full CO2 capture, which is planned to be built in the Norwegian municipality of Kvinnherad. The capture technology is the first of its kind and can also be applied to existing coal power plants.
SWECO Finland has some 80 employees and at present mainly provides construction management and project management services through the subsidiary SWECO CMU.
Net sales amounted to SEK 42.2 million (17.2). Operating profit was SEK 7.3 million (2.9) and operating margin was 17.4 per cent (16.9).
The market for consulting engineering services is showing positive development and continued strong demand is expected throughout the remainder of the year. There is a growing inflow of investment to the infrastructure sector and the construction sector is noting strong demand for commercial space, office and public facilities such as hospitals. Growth in the environmental market remains positive, but has slowed somewhat.
SWECO won several notable contracts in the first half of 2007, including additional orders in connection with renovation and enlargement of the Stockmann department store in Helsinki and construction management services for the property development company Sponda.
The Baltic countries and Eastern Europe are dynamic growth markets for SWECO. Operations in this region are conducted via the business units SWECO Baltic & Eastern Europe with some 670 employees and SWECO Russia with around 110 employees. SWECO also has extensive project exports to these markets from Sweden, Norway and Finland, primarily in water and environment, infrastructure, industry and architecture.
Net sales for SWECO Baltic & Eastern Europe rose sharply to SEK 77.6 million (14.2). Operating profit was SEK 8.1 million (1.1) and operating margin was 10.5 per cent (7.7). Net sales for SWECO Russia increased by 42 per cent to SEK 5.4 million (3.8). Operating profit amounted to 0.6 million (1.2) and operating margin to 10.7 per cent (31.6).
The Central and Eastern European economies are undergoing powerful expansion driven partly by continued development and modernisation of society and partly by ongoing adaptation to EU standards. Environmental improvements and modernisation of infrastructure are continuing with undiminished strength.
There is a keen demand for SWECO's services, particularly in the environmental area but increasingly also in the industrial, infrastructure, energy and architecture areas as these countries upgrade their water and sewage systems, transport systems, energy supply, industrial facilities, housing and commercial premises.
In Lithuania, SWECO won a large-scale contract in connection with the implementation of a new waste management system in the city of Kaunas.
In the Czech Republic, SWECO's recently acquired subsidiary Hydroprojekt was selected to prepare a master plan for the Elbe River's run-off areas in the country.
At the beginning of July, SWECO's Russian company Lenvodokanalproekt won two major environmental contracts in the city of Petrozavodsk in northwest Russia. The contracted services include inspection of the city's water and wastewater systems and drafting of proposals for how the systems can be improved.
SWECO PIC is the Group's global resource for qualified industrial consulting services. The company's capabilities include consulting, planning, engineering, and project management services for product development, production optimisation and plant investment. With more than 900 employees in Finland, 200 in Sweden and 20 in Norway, the company is one of the Nordic region's largest industrial engineering consultancies. SWECO PIC also has extensive international operations in Europe, Asia and South America. Operations are conducted in five divisions: Process Industry, Product and Manufacturing Industry, Energy, Electronics and Marine Industry.
Net sales were up by 13 per cent to SEK 473.3 million (420.1). Operating profit rose to SEK 37.8 million (22.8) and operating margin was 8.0 per cent (5.4).
The market for industrial consulting services is showing solid growth, driven by rising investment in facilities for industry, research and product development. Ongoing structural changes in the industrial sector are also boosting demand for consulting services. The manufacturing and telecom industries are increasingly contracting out product development and industrial design to external consultants, both domestic and in the international market in Europe and Asia. Investments in the forestry industry are concentrated outside the Nordic region, particularly in South America, Asia and Russia.
SWECO has been commissioned to deliver consulting engineering services for construction of the world's largest luxury cruise vessel, Genesis, which can accommodate 5,400 passengers. SWECO's services will include hull analysis and engineering design of mechanical systems. The assignment is being carried out on behalf of Aker Yards and is valued at around SEK 14 million.
SWECO's industrial consultants were awarded a major contract by Växjö Värnamo Biomass Gasification Centre (VVBGC) in connection with rebuilding and retrofitting of a unique biomass gasification plant in Värnamo, Sweden. The rebuild of the gasification plant is part of the CHRISGAS R&D project, where the aim is to develop and optimise an energy- and cost-efficient method to produce hydrogen-rich gases from renewable biomass. The contract is worth approximately SEK 18 million.
In product development and industrial design, SWECO has been awarded several interesting assignments for clients like Fiskars' Buster boats and Metso Automation.
SWECO Position has acquired the Swedish GIS consulting firm SWEGIS with seven employees. The company is a total supplier of software and services for Geographic Information Systems (GIS). The acquisition will further strengthen SWECO Position's offering in the Swedish consulting market for GIS.
SWECO Grøner has signed an agreement to acquire the northern Norwegian consulting engineering firm of AT Consult with 27 employees. The company is primarily active in the construction and civil engineering sectors and has longstanding experience of assignments in the Arctic region. The acquisition will strengthen SWECO's position in northern Norway and the capacity to offer clients in this region a wider range of services.
SWECO Grøner has also signed an agreement to acquire the operations of the Norwegian engineering consultancy NNBK Finnmark with 14 employees. NNBK Finnmark has a strong market position in Northern Norway and is specialised in areas like planning, design and construction management.
SWECO has acquired the Czech consulting company Hydroprojekt CZ, with 270 employees, which is active mainly in water resources and wastewater management. The acquisition will strengthen SWECO's position in the Czech Republic and create a new home market in Central Europe, as well as consolidating the market position in water and environment.
SWECO has acquired an additional 29 per cent of the shares in the Lithuanian consulting engineering company LSPI, bringing its total holding to 99 per cent.
SWECO has also acquired an additional 10.2 per cent of the shares in the Estonian subsidiary SWECO Projekt, after which SWECO holds 60.2 per cent of the shares in the company.
SWECO PIC has acquired the wireless product development unit of Flextronics ODM Finland Oy, with 16 employees. The acquisition will widen SWECO's scope to offer comprehensive product development services for companies in the telecom sector.
SWECO complies with the International Financial Accounting Standards (IFRS) and interpretations of these (IFRIC) that have been endorsed by the European Commission for application in the EU. This interim report is presented in accordance with IAS 34, Interim Financial Reporting. The accounting and valuation standards applied in this interim report are the same as those used in the annual report for 2006.
The SWECO Group's significant risks and uncertainties include business risks tied to the general economic trend and investment propensity in different markets, the ability to attract and retain competent personnel and the effects of political decisions. The Group is also exposed to different types of financial risk, such as foreign exchange, interest rate and credit risk. No significant risks are assessed to have arisen aside from those presented on page 40 of SWECO's annual report, "Risk Management".
| Interim report January-September: | 23 October |
|---|---|
| Year-end report: | 6 February 2008 |
SWECO's ambition is to achieve sustained profitable growth by strengthening its positions in the Nordic market and expanding its operations in the markets of Eastern and Central Europe. In view of robust demand for all of SWECO's services, the outlook for 2007 is deemed favourable.
The Board of Directors and the CEO give their assurance that this semi-annual report provides a true and fair picture of the operations, financial position and operating results of the Parent Company and the Group, and presents the significant risks and uncertainties to which the Parent Company and the Group companies are exposed.
Stockholm, 24 July 2007 SWECO AB (publ)
Olle Nordström Eric Douglas Anders Frick Chairman Deputy Chairman Board Member
Birgit Erngren Wohlin Aina Nilsson Ström Håkan Brinkenberg
Board Member Board Member Employee Representative
Anna Leonsson Magnus Naesman Mats Wäppling Employee Representative Employee Representative Board Member, President
& CEO
This interim report has not been examined by the company's auditors.
This is the type of information that SWECO is obligated to disclose in accordance with the Swedish Securities Exchange and Clearing Operations Act and/or the Financial Instruments Trading Act.
Mats Wäppling, Managing Director & CEO of SWECO AB Telephone +46 8-695 66 07 [email protected]
Bo Jansson, Chief Financial Officer of SWECO AB Telephone +46 8-695 66 06 [email protected]
SWECO AB (publ) Corp. identity no. 556542-9841 Gjörwellsgatan 22, Box 34044, SE-100 26 Stockholm Telephone: +46 8-695 60 00, Fax +46 8-695 66 10 E-mail: [email protected] www.sweco.se
| Income statement, SEK M | April-June | April-June | Jan-June | Jan-June July 2006- | Full year | |
|---|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 June 2007 | 2006 | ||
| Net sales | 1,157.7 | 967.0 | 2,302.7 | 1,925.5 | 4,271.9 | 3,894.7 |
| Other external expenses | -296.3 | -243.0 | -571.9 | -466.7 | -1,148.4 | -1,043.2 |
| Personnel costs | -744.4 | -639.1 | -1,457.4 | -1,245.6 | -2,643.6 | -2,431.8 |
| Amortisation/depreciation | -17.0 | -14.6 | -33.0 | -27.6 | -63.2 | -57.8 |
| Operating profit | 100.0 | 70.3 | 240.4 | 185.6 | 416.7 | 361.9 |
| Net financial items | -1.5 | 1.4 | -1.8 | 3.8 | -3.1 | 2.5 |
| Profit before tax | 98.5 | 71.7 | 238.6 | 189.4 | 413.6 | 364.4 |
| Tax | -30.9 | -21.4 | -72.2 | -56.7 | -121.6 | -106.1 |
| Profit after tax | 67.6 | 50.3 | 166.4 | 132.7 | 292.0 | 258.3 |
| Attributable to: | ||||||
| Equity holders in the Parent Company | 63.6 | 47.7 | 161.0 | 127.8 | 286.6 | 253.4 |
| Minority interest | 4.0 | 2.6 | 5.4 | 4.9 | 5.4 | 4.9 |
| Earnings per share for profit attributable to equity holders in the Parent Company, SEK |
||||||
| - Before dilution | 0.75 | 0.56 | 1.91 | 1.51 | 3.40 | 3.00 |
| - After dilution | 0.75 | 0.56 | 1.89 | 1.51 | 3.38 | 2.99 |
| Dividend per share, SEK | - | - | - | - | - | 1.50 |
| Redemption amount per share, SEK | - | - | - | - | - | 1.70 |
| Average number of shares* | 84,251,350 | 84,451,350 | 84,251,350 84,451,350 84,284,683 84,384,685 | |||
| Average number of shares after dilution* | 85,080,904 | 84,881,480 | 84,978,824 84,868,060 84,869,931 84,805,825 |
* The number of shares for earlier periods has been recalculated with respect to the now completed share split.
1) The period prior to 2004 refers to operating profit according to the then applicable accounting standards excluding goodwill amortisation.
| Cash flow statement, SEK M | April-June | April-June | Jan-June | Jan-June July 2006- Full year | ||
|---|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 June 2007 | 2006 | ||
| Cash flow from operating activities before changes in working capital and paid tax |
115.6 | 89.5 | 273.3 | 222.3 | 472.2 | 421.2 |
| Paid tax | -48.8 | -23.3 | -134.5 | -89.8 | -187.6 | -142.9 |
| Changes in working capital | -6.6 | -5.9 | -32.2 | -66.2 | -0.5 | -34.5 |
| Cash flow from operating activities | 60.2 | 60.3 | 106.6 | 66.3 | 284.1 | 243.8 |
| Cash flow from investing activities | -93.2 | 254.3 | -134.7 | 110.7 | -215.2 | 30.2 |
| Cash flow from financing activities | -41.6 | -276.9 | -53.2 | -282.2 | -54.1 | -283.1 |
| Cash flow for the period | -74.6 | 37.7 | -81.3 | -105.2 | 14.8 | -9.1 |
| Balance sheet, SEK M | 30 June 2007 | 30 June 2006 | 31 Dec 2006 |
|---|---|---|---|
| Intangible assets | 602.4 | 401.7 | 444.5 |
| Tangible assets | 149.7 | 116.3 | 142.4 |
| Financial assets | 64.4 | 48.5 | 44.3 |
| Other current assets | 1,347.1 | 1,108.4 | 1,195.1 |
| Cash and cash equivalents | 149.4 | 133.7 | 224.6 |
| Total assets | 2,313.0 | 1,808.6 | 2,050.9 |
| Share capital and reserves attributable to equity holders in the Parent Company |
733.7 | 721.8 | 825.6 |
| Minority interest | 22.3 | 20.2 | 10.3 |
| Total equity | 756.0 | 742.0 | 835.9 |
| Long-term liabilities | 117.9 | 179.1 | 107.6 |
| Current liabilities | 1,439.1 | 887.5 | 1,107.4 |
| Total equity and liabilities | 2,313.0 | 1,808.6 | 2,050.9 |
| Pledged assets | - | - | 1.8 |
| Contingent liabilities | 125.6 | 44.1 | 128.5 |
| Changes in equity, SEK M | Jan-June 2007 |
Jan-June 2006 |
Full year 2006 |
| Equity, opening balance | 835.9 | 880.7 | 880.7 |
| Exchange difference on translation of foreign operations |
18.0 | -8.3 | -25.1 |
| Income and expenses reported directly | |||
| in equity | 18.0 | -8.3 | -25.1 |
| Profit for the period | 166.4 | 132.7 | 258.3 |
| Total reported income and expenses | 184.4 | 124.4 | 233.2 |
| Capital distribution to shareholders | -269.6 | -261.8 | -269.9 |
| Minority interests in acquired companies | 16.7 | - | 3.5 |
| Purchase of minority interests | -10.3 | - | -10.1 |
| Issue expenses | -1.1 | -1.3 | -1.5 |
| Equity, closing balance | 756.0 | 742.0 | 835.9 |
| Dividend of SEK 1.50 per share | - | - | -126.4 |
| Redemption amount of SEK 1.70 per share | - | - | -143.2 |
| Key ratios1) | Jan-June 2007 |
Jan-June 2006 |
Full year 2006 |
|---|---|---|---|
| Operating margin, % | 10.4 | 9.6 | 9.3 |
| Profit margin, % | 10.4 | 9.8 | 9.4 |
| Return on equity, % | 39.3 | 40.1 | 29.9 |
| Return on capital employed, % | 43.8 | 42.8 | 38.2 |
| Equity/assets ratio, % Equity per share for profit attributable to equity holders in the Parent Company, SEK |
32.7 | 41.0 | 40.8 |
| - Before dilution | 8.61 | 8.55 | 9.80 |
| - After dilution | 8.61 | 8.51 | 9.73 |
| Interest-bearing debt, SEK M | 324.9 | 104.1 | 105.8 |
| Of which, liabilities to credit institutions | 307.3 | 74.9 | 75.3 |
| Average number of employees | 4,606 | 3,802 | 3,986 |
| Number of shares on closing date2) | 84,251,350 | 84,451,350 | 84,251,350 |
| Number of shares on closing date after dilution2) | 85,256,334 | 84,798,130 | 84,887,845 |
| Number of shares on closing date after full dilution2) | 85,939,110 | 85,939,700 | 85,739,700 |
| Number of repurchased class B and C shares2) | 2,163,000 | 963,000 | 1,163,000 |
1) The definitions of key ratios are unchanged and can be found in SWECO's annual report for 2006.
2) The number of shares for earlier periods has been recalculated with respect to the now completed share split.
| Business segment | Operating profit Average number Operating margin of employees SEK M % |
Net sales SEK M |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 | 2007 | 2006 | 2007 | 2006 | |||
| SWECO Sweden | 1,364.6 | 1,156.7 | 155.2 | 130.4 | 11.4 | 11.3 | 2,342 | 1,995 | ||
| SWECO Grøner – Norway | 375.7 | 321.2 | 36.6 | 29.2 | 9.7 | 9.1 | 534 | 484 | ||
| SWECO Finland | 42.2 | 17.2 | 7.3 | 2.9 | 17.4 | 16.9 | 74 | 57 | ||
| SWECO Baltic & Eastern Europe |
77.6 | 14.2 | 8.1 | 1.1 | 10.5 | 7.7 | 419 | 81 | ||
| SWECO Russia | 5.4 | 3.8 | 0.6 | 1.2 | 10.7 | 31.6 | 48 | 37 | ||
| SWECO PIC – Industry | 473.3 | 420.1 | 37.8 | 22.8 | 8.0 | 5.4 | 1,176 | 1,047 | ||
| Group-wide, eliminations, etc. | -36.1 | -7.7 | -5.2 | -2.0 | - | - | 13 | 101 | ||
| Total Group | 2,302.7 | 1,925.5 | 240.4 | 185.6 | 10.4 | 9.6 | 4,606 | 3,802 |
Net sales, operating profit, operating margin and average number of employees during the period January-June
During the year, SWECO has acquired Autosolvia AB, JAPS Elektronik AB, EuroFutures Fredriksson & Partners AB, Kedbrant & Wickberg Teknik AB, Hydroprojekt CZ a.s, Hydroreal a.s, Costers Geoborr AB and SWEGIS AB, as well as the net assets of Grapenfelt norr AB, Markteknik i Bromma AB, AT Consult and Flextronic's unit for wireless product development. During the year, SWECO Projekt has been fusioned with ETP Grupp, Eesti Projekt and SWECO Eesti, of which ETP Grupp and Eesti Projekt were not previously included in the Group. In the second quarter, SWECO also acquired minority holdings in LSPI and Sweco Projekt. Based on preliminary acquisition analyses, these acquisitions affected the Group's balance sheet and cash and cash equivalents as shown in the table below. Since the beginning of the year, the acquired companies have contributed sales of SEK 89 million and operating profit of SEK 6 million. If all companies had been acquired at 1 January 2007, the SWECO Group's net sales would have increased by an additional sum of approximately SEK 83 million and operating profit by approximately SEK 6 million.
| Acquired | ||||
|---|---|---|---|---|
| SEK M | JAPS | Hydroprojekt | Others | Total |
| Assets in acquired companies | 28.5 | 47.1 | 79.5 | 155.1 |
| Liabilities in acquired companies | -16.9 | -18.7 | -40.4 | -76.0 |
| Minority interest reported on acquisition | -0.1 | - | -6.0 | -6.1 |
| Surplus value | ||||
| Intangible assets | 33.1 | 29.5 | 80.1 | 142.7 |
| Tangible assets | - | 0.5 | 1.6 | 2.1 |
| Deferred tax | - | -0.1 | -0.4 | -0.5 |
| Total purchase price | 44.6 | 58.3 | 114.4 | 217.3 |
| Unsettled purchase price commitment | -4.5 | - | -14.4 | -18.9 |
| Unsettled purchase price commitments regarding acquisitions in earlier years |
- | - | -3.6 | -3.6 |
| Cash and cash equivalents in acquired companies |
-6.3 | -6.5 | -44.3 | -57.1 |
| Effect on the Group's cash and cash equivalents |
33.8 | 51.8 | 52.1 | 137.7 |
| Five-year overview1) | July 2006- | Full year | |||
|---|---|---|---|---|---|
| June 2007 | 2006 | 2005 | 2004 | 20032) | |
| Net sales, SEK M | 4,271.9 | 3,894.7 | 3,372.2 | 3,141.4 | 2,211.4 |
| Operating profit, SEK M | 416.7 | 361.9 | 271.6 | 208.6 | 96.8 |
| Profit before tax, SEK M | 413.6 | 364.4 | 351.2 | 222.3 | 119.5 |
| Operating margin, % | 9.8 | 9.3 | 8.1 | 6.6 | 4.4 |
| Billing ratio, % | 75.8 | 75.3 | 74.2 | 72.1 | 68.9 |
| Return on equity, % | 39.3 | 29.9 | 35.3 | 26.7 | 16.8 |
| Return on capital employed, % | 43.8 | 38.2 | 38.1 | 27.7 | 19.6 |
| Equity/assets ratio, % | 32.7 | 40.8 | 43.2 | 38.1 | 32.4 |
| Earnings per share, SEK | |||||
| - Before dilution | 3.40 | 3.00 | 3.18 | 1.88 | 1.13 |
| - After dilution | 3.38 | 2.99 | 3.17 | 1.86 | 1.12 |
| Dividend per share, SEK | - | 1.50 | 1.10 | 0.80 | 0.60 |
| Redemption amount per share, SEK | - | 1.70 | 2.00 | - | - |
| Average number of employees | 4,351 | 3,986 | 3,626 | 3,445 | 2,437 |
1) The definitions of key ratios are unchanged and can be found in SWECO's annual report for 2006.
2) 2003 is not covered by IFRS but is reported according to the then applicable accounting standards.
| Parent Company income statement, | Jan-June | Jan-June | Full year |
|---|---|---|---|
| SEK M | 2007 | 2006 | 2006 |
| Net sales | 28.9 | 35.8 | 71.1 |
| Other external expenses | -19.1 | -7.4 | -19.4 |
| Personnel costs | -14.8 | -27.7 | -54.8 |
| Amortisation/depreciation | -0.2 | -1.2 | -2.0 |
| Operating profit | -5.2 | -0.5 | -5.1 |
| Net financial items | 22.5 | 6.1 | 749.5 |
| Profit after net financial items | 17.3 | 5.6 | 744.4 |
| Appropriations | - | - | 0.1 |
| Profit before tax | 17.3 | 5.6 | 744.5 |
| Tax | 0.1 | - | -72.6 |
| Profit after tax | 17.4 | 5.6 | 671.9 |
| Parent Company balance sheet, SEK M | 30 June 2007 | 31 Dec 2006 |
|---|---|---|
| Tangible assets | 1.5 | 2.0 |
| Financial assets | 463.0 | 406.1 |
| Current assets | 650.4 | 1,216.1 |
| Total assets | 1,114.9 | 1,624.2 |
| Equity | 797.0 | 1,048.7 |
| Untaxed reserves | 0.1 | 0.1 |
| Current liabilities | 317.8 | 575.4 |
| Total equity and liabilities | 1,114.9 | 1,624.2 |
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