In This Article:
Release Date: February 11, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Bravida Holding AB (FRA:BV0) reported a stable result with sales in line with the previous year and a slightly improved margin.
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The company achieved a strong cash conversion rate of 105%, allowing the board to propose an increased dividend.
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Margin improvements were noted in Denmark, Norway, and Finland, with Denmark showing a significant turnaround.
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Service business continued to grow, with a 5% increase in the quarter.
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The company maintained a strong balance sheet with low debt levels, providing room for acquisitions and dividend payouts.
Negative Points
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Organic growth was negative, offset only by a 4% acquired growth.
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The order intake was challenging, down 26%, partly due to tough comparisons with a large project won in the previous year.
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The market in the south part of Sweden remained weak, impacting overall group margins.
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Restructuring costs in Sweden and Denmark amounted to close to 70 million, affecting profitability.
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The Finnish market was identified as the weakest, with a decrease in order intake by 11% and a 33% year-on-year decline in order backlog.
Q & A Highlights
Q: Regarding the restructuring in southern Sweden, are these the final measures, and how much have you reduced the FTEs in the region? A: We have laid off between 300 and 400 people in southern Sweden. The restructuring costs are split between layoffs and premises. We believe the market has bottomed out, so for now, we are done with restructuring, but it depends on market developments. (Unidentified_1 and Unidentified_2)
Q: In Denmark, margins are back in positive territory. Can you provide insight into the profitability between services and installation? A: The installation business is still negative but improving. The service growth is not sustainable at current high levels, but the margin in Denmark is expected to continue improving in 2025. (Unidentified_1 and Unidentified_2)
Q: What is holding back clients from converting quotations into firm orders? A: The market is turning with lower interest rates and a more positive attitude from investors. Clients are currently assessing costs and prices before committing to contracts. This is a typical first sign of market recovery. (Unidentified_1)
Q: In Norway, with the acquisition of Tuno Group, how is the service resilience expected to offset slower installation sales? A: We expect Norway to continue improving margins, supported by the Tuno Group acquisition. The service business is holding up well, which should help offset slower installation sales. (Unidentified_1)