Net Sales in quarter exceed 1 BSEK for first time
Second quarter of 2021
- Consolidated net sales increased by 13 percent to SEK 1,067 m (949), of which organic growth amounted to 8 percent, acquisitions with 7 percent and currency had a negative impact of -3 percent
- Net sales in Product & Solutions amounted to SEK 850 m (753) and in Installation Services to SEK 246 m (228)
- Gross profit increased to SEK 327 m (281), Gross margin increased to 30.6% (29.7%)
- EBITDA increased to SEK 192 m (166), EBITDA margin increased to 18.0% (17.4%)
- Operating profit (EBIT) increased to SEK 160 m (137), EBIT margin increased to 15.0% (14.4%)
- ROCE increased to 16.8 percent (15.6)
- Cash flow from operating activities amounted to SEK 114 m (114)
- Earnings per share before and after dilution were SEK 4.84 (4.55) and SEK 4.80 (4.51), respectively
- Consolidated net sales increased by 9 percent to SEK 1,771 m (1,618), of which organic growth amounted to 6 percent, acquisitions with 7 percent and currency had a negative impact of -3 percent
- Net sales in Product & Solutions amounted to SEK 1,413 m (1,291) and in Installation Services to SEK 399 m (379)
- Gross profit increased to SEK 510 m (441), Gross margin increased to 28.8% (27.2%)
- EBITDA increased to SEK 242 m (198), EBITDA margin increased to 13.7% (12.2%)
- Operating profit (EBIT) increased to SEK 182 m (139), EBIT margin increased to 10.3% (8.6%)
- Cash flow from operating activities amounted to SEK 27 m (28)
- Earnings per share before and after dilution were SEK 5.31 (4.18) and SEK 5.27 (4.14), respectively
Message from the CEO
Net Sales in quarter exceed 1 BSEK for first time
Consolidated net sales in the second quarter increased by 13 percent compared to the previous year, from SEK 949 million to SEK 1,067 million, first time ever exceeding 1 BSEK in a single quarter. Organic growth was 8 percent, the impact from acquisitions was 7 percent and currency translation effects were -3 percent.
EBIT for the second quarter amounted to SEK 160 million, compared to SEK 137 million for the corresponding period last year. The positive development of the operating result is mainly explained by good sales growth, operational efficiency and good cost control. Our Return on Capital Employed at 16.8 percent (15.6) remains above target. Our cash flow from operating activities was in line with the previous year of SEK 114 million (114).
During the second quarter several of our suppliers implemented significant price increases for most of our business units. This has in turn led us to implement sales price increases in most of our businesses. We can not rule out some degree of margin compression in the second half, should input cost inflation accelarate.
During the quarter the group established the CSO-position (Chief Sustainability Officer). Susanne Højholt, Group R&D Manager, has taken the role with immediate effect in combination with her current responsibilities.
We have made another acquisition during the quarter and one early in the third quarter, bringing the total in 2021 to six, while retaining a solid balance sheet.
The net sales organic growth of 8 percent (17) in the first quarter are explained by good sales in the Products & Solutions operating segment, which organically grew 12 percent (10) while the Installation Services operating segment decreased organically by -6 percent (-3).
In the Products & Solutions operating segment, the Bitumen-based waterproofing business showed double-digit growth in Norway and Finland while growth in Denmark and Sweden were on a lower level.
SealEco, our synthetic rubber proofing business, had another strong quarter, with double-digit growth rates in total and on all major markets.
The Taasinge group, our prefabricated wooden elements business had a strong double-digit growth compared to the previous year. The profit improvement program has resulted in a significant turn-around within the Taasinge Group. In both Denmark and Norway, we have a good level in the order books and are fully booked for 2021.
The sales development for our green urban environments businesses, sold under the brands Veg Tech and Urban Green, were organically slightly negative in the quarter.
In the Installation Services operating segment, where sales are mainly generated in Finland, Net sales decreased organically by -6 percent, mainly because of a weaker market. Both floor coverings and roof maintenance showed good growth.
Our Danish franchisees continue to experience a stable and strong market and during the second quarter had an EBIT contribution similar to last year and an order book well exceeding the level of last year.
As previously, we have not seen any significant effects from the Covid-19 pandemic. Our focus is on protecting the health of our employees, taking responsibility for our communities, and securing our full supply capability for our customers
During the quarter we have closed the acquisitions of E. Voutilainen Oy, a Finnish company being specialist in liquid floor coating, and Seikat Oy, a Finnish company supplying long-span wooden prefabricated elements. Our active acquisition strategy has led to another transaction when we on the 14 July acquired Rakennusliike Ripatti Oy, a specialist in metallic façade construction, metal profiling and machining and pre-made eaves system with integrated fall protection under the brand RipRap. This resulting in a total of six acquisitions so far during 2021.
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, 20 July 2021
President and CEO
A conference call for investors, analysts and media will be held today, 20 July 2021, at 10:00 a.m. CEST 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:
From the United Kingdom: +44 33 33 00 90 35
From Denmark: +45 78 15 01 08
From Sweden: +46 8 566 427 07
The English version is a translation of the Swedish original. In the event of any differences, the Swedish version applies.