Investors

Second quarter of 2022

• Consolidated net sales increased by 18 percent to SEK 1,255 m (1,067), of which organic growth amounted to 11 percent, acquisitions 4 percent and currency effects 3 percent.
• Net sales in Product & Solutions amounted to SEK 1,021 m (850) and in Installation Services to SEK 291 m (246)
• Gross profit increased to SEK 379 m (327), Gross margin decreased slightly to 30.2% (30.6%)
• EBITDA increased to SEK 216 m (192), EBITDA margin decreased to 17.2% (18.0%)
• Operating profit (EBIT) increased to SEK 180 m (160), EBIT margin decreased to 14.4% (15.0%)
• ROCE increased to 17.9 percent (16.6)
• Cash flow from operating activities amounted to SEK 38 m (114)
• Earnings per share before and after dilution were SEK 5.86 (4.84) and SEK 5.82 (4.80), respectively

January-June 2022

• Consolidated net sales increased by 22 percent to SEK 2,167 m (1,771), of which organic growth amounted to 14 percent, acquisitions with 5 percent and currency had an impact of 3 percent
• Net sales in Product & Solutions amounted to SEK 1,794 m (1,413) and in Installation Services to SEK 462 m (399)
• Gross profit increased to SEK 616 m (510), Gross margin decreased to 28.4% (28.8%)
• EBITDA increased to SEK 307 m (242), EBITDA margin increased to 14.2% (13.7%)
• Operating profit (EBIT) increased to SEK 236 m (182), EBIT margin increased to 10.9% (10.3%)
• Cash flow from operating activities amounted to SEK 22 m (27)
• Earnings per share before and after dilution were SEK 7.48 (5.31) and SEK 7.43 (5.27), respectively

Message from the CEO

Last 12 months sales above milestone of SEK 4 B for the first time

Consolidated net sales in the second quarter increased by 18 percent compared to the previous year, from SEK 1,067 million to SEK 1,255 million. Organic growth was 11 percent of which 13 percent were sales price increases and volume development was -2 percent, the impact from acquisitions was 4 percent and currency translation effects were 3 percent. Organic growth was 15 percent in Products & Solutions and 5 percent in Installation Services.

EBIT for the second quarter amounted to SEK 180 million, compared to SEK 160 million for the corresponding period last year. The positive development of the operating result is explained by Products & Solutions increasing profitability due to a good sales development with a pro-active approach to price management while Installation Services had a profit slightly below second quarter last year.

Our Return on Capital Employed at 17.9 percent (16.6) remains significantly above the threshold of 13 percent. The improvement is driven by the improved operating result. Operational cash flow has been negatively affected by increased accounts receivable because of increased sales and increased inventory due to securing raw material availability, higher input costs and higher finished product levels to secure our delivery capabilities.

Within a relatively fluid macro environment, we are seeing a stabilization of input costs and additional signs of somewhat slower construction demand. However we have been able to increase our market share in most of our business units.

The net sales organic growth of 11 percent (8) in the second quarter are explained by good sales in the Products & Solutions operating segment, which organically grew 15 percent (12) of which 14 percent were related to sales price increases and volume development was 1 percent while the Installation Services operating segment increased organically by 5 percent (-6) whereof 7 percent were related to sales price increases and volume development was -2 percent.

In the Products & Solutions operating segment, the Bitumen-based waterproofing business showed strong double-digit growth on all the four Nordic markets. SealEco, our synthetic rubber waterproofing business, also had double-digit sales growth. Our major markets show continued strong demand, however in the more consumer related Distripond business we saw a weaker development.
Taasinge group, our prefabricated wooden elements business, had sales on the same level as last year with a stronger development on the Danish market. In both Denmark and Norway, we have strong order books. Seikat, our Finnish entity within this business, has started the year well and is basically fully booked for the rest of 2022.
Sales development of our green infrastructure businesses, sold under the brands Veg Tech and Urban Green, showed strong double-digit organic development compared with the same period previous year.

In the Installation Services operating segment net sales increased with 18 percent. Organic growth was 5 percent, of which 7 percent was sales price increases and volume development was -2 percent, the impact from acquisitions was 9 percent and currency translation effects were 4 percent.

Our Danish franchisees continue to experience a stable and strong market and the order books are well exceeding the level of last year. In the second quarter the EBIT contribution was somewhat below last year.

During the quarter we signed an agreement to acquire 70 percent of the shares in the VKP Group, a group headquartered in Kajaani in northeast Finland providing roofing and waterproofing services. The transaction was completed on 1 July.

We continue to focus on organic growth, profitability, sustainability, and selective acquisitions. Our balance sheet is strong, and we continue to have the capacity to carry out acquisitions. We have a strategic focus to promote sustainable building solutions and enhance our service and product portfolio.

Helsingborg, 19 July 2022

Martin Ellis,
President and CEO

Conference call

A conference call for investors, analysts and media will be held today, 19 July 2022, at 10:00 a.m. CET and can be joined online at www.nordicwaterproofing.com. Presentation materials for the call will be available on the website one hour before the call.
To participate, please dial any of below numbers and use pin code 7021766#:
From the United Kingdom: +44 20 31 98 48 84
From US: +1 412 317 6300
From Sweden: +46 8 50 51 63 86