In This Article:
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Order Intake: Increased by 111% to 285 million SEK.
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Net Sales: Increased by 31% to 331 million SEK.
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Adjusted Operating Profit: 16 million SEK, with an adjusted operating margin of 5.0%.
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Earnings Per Share: -0.036 SEK.
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Operating Cash Flow: -1 million SEK.
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Order Backlog: Increased by 25% to approximately 1.4 billion SEK.
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Renovation Segment Net Sales: Increased by 10% to 247 million SEK.
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Renovation Segment Order Intake: More than tripled to 250 million SEK.
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New Build Segment Net Sales: Almost tripled to 84 million SEK.
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New Build Segment Order Intake: Decreased to 35 million SEK from 53 million SEK last year.
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Equity: 799 million SEK with an equity ratio of 49%.
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Interest Bearing Net Debt: 2.8 times adjusted EBITDA, up from 1.1 last year.
Release Date: October 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Balco Group AB (OSTO:BALCO) more than doubled its order intake, increasing by 111% compared to the previous year.
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Net sales increased by 31% to 331 million SEK, driven by recent acquisitions.
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The company has developed new innovative solutions, such as glazing that offers up to 30% energy savings, enhancing its position in the Green Transformation market.
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The order backlog increased by 25%, reaching approximately 1.4 billion SEK, indicating strong future business potential.
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The newly acquired Finnish company, Swu Lanes, secured several major projects, contributing positively to the group's performance.
Negative Points
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Despite increased sales, profitability remains below target with an adjusted EBIT margin of 5%.
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The company faces significant price pressure in the facade segment, particularly in Sweden.
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Organic growth was negative, with a decline of 8% in the quarter.
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The interest-bearing net debt increased, with a net debt to adjusted EBITDA ratio rising to 2.8 from 1.1 last year.
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There is a noted trend of longer decision times from clients, which could delay project starts and revenue realization.
Q & A Highlights
Q: Could you quantify the covenants interest coverage ratio and net debt to adjusted EBITDA? A: Michael Grindborn, CFO, explained that they have a 12-month performance EBITDA and can go up to 4.0 in a single quarter, but must reduce to 3.75 the following quarter and then to 3.5 thereafter.
Q: How is the development progressing in different parts of Sweden, especially in the Stockholm area? A: Camilla Ekdahl, COO, stated that there is no significant difference in performance between Stockholm and the rest of Sweden. However, balcony companies are seeing increased activity, while facade companies face price pressure.