Interim report Jan- Mar 2018

Transcription

1 Interim report Jan- Mar 2018 JONAS GUSTAVSSON, CEO STEFAN JOHANSSON, CFO APRIL 25, 2018

2 Agenda Business overview Market and highlights Financials Divisional performance Strategy implementation Summary INTERIM REPORT JAN - MAR

3 Q1, 2018 Improved result in a continued favourable market Net Sales: SEK M +4.6 % Improved profit and margin Overall favourable market EBITA: 325 SEK M EBITA-margin: 9.5% (8,8%) % Good demand in all divisions Slowed organic growth due to resource shortage INTERIM REPORT JAN - MAR

4 We re an engineering and design company Industry 34% 100 Activity in more than 100 countries 13 BSEK Net Sales 2017 Divisions Infrastructure 39% Digital Solutions 16% Energy 11% 10,000 Employees The market s most comprehensive portfolio of service offer across industries Numbers represent 2017 INTERIM REPORT JAN - MAR

5 Moving businesses and society forward Industry Segments Infrastructure 19% Real Estate 17% Automotive & Vehicle 16% Energy and Power 14% Life Science, Food & Pharma 8% Manufacturing Industry 6% Process Industry 6% Telecom and ICT 5% Defence 4% Other 5% 33% Public Sector 67% Private Sector Numbers represent 2017 INTERIM REPORT JAN - MAR

6 Infrastructure Buildings Rail & Road Project Management Water & Environment Architecture & Design Industry Advanced Manufacturing Automotive R&D Food & Pharma Process Industry Product Development Industrial Engineering Specialized Technical Service Energy Thermal Heat & Power Hydro Power Renewable Energy Nuclear Energy Transmission & Distribution Oil & Gas Energy Markets Digital Solutions Experience Design IT Solutions Embedded Systems Systems Management INTERIM REPORT JAN - MAR

7 Our solutions respond to global trends SMART CITIES AND INFRASTRUCTURE FUTURE MOBILITY INDUSTRIAL DIGITALIZATION CHANGING ENERGY MARKETS INTERIM REPORT JAN - MAR

8 Market development Q1 The overall market is largely unchanged compared to previous quarter Industrial market still strong in most of the sectors Continued high rate of investments in the infrastructure market in Sweden and Norway The energy market is stabilized, but still weak in Europe. Conversion to fossil-free production and increased need for energy storage and smart grids The digitalization trend drives increasing demand for digital solutions in all markets INTERIM REPORT JAN - MAR

9 HIGHLIGHTS New projects Q1 New automation order for Henriksdals purification plant, Stockholm Vatten och Avlopp ~ 200 SEK M Expansion of the world s largest dissolving pulp mill in South Africa, Sappi Extended strategic partnership with Electrolux Pre study of the expansion of Arlanda Terminal 5, Swedavia Green profile design assignment of new biomass plant, Hamburg Design of Rhône bridge St. Triphon, Switzerland New hydropower plant in South Asia INTERIM REPORT JAN - MAR

10 HIGHLIGHTS Acquisitions January: Gottlieb Paludan Architects - Danish architect specialized in transport infrastructure, energy and industrial plants. 90 employees and sales ~SEK 140 million January: Arcad Architects based in Switzerland and specialized in industrial and commercial buildings. 8 employees and sales ~SEK 10 million April: Samtanke based in Karlstad with experts within app, web and integration solutions. 6 employees INTERIM REPORT JAN - MAR

11 Growth in Q1 Q1, 2018 Net sales: SEK M (3 265) Total growth: 4.6% Organic growth: 0.3% Adjusted/underlying organic growth: 2% COMMENTS - Overall favourable market - Good demand in all divisions NET SALES, SEK M Slowed organic growth due to resource shortage 0 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q Quarter Rolling 12 mths INTERIM REPORT JAN - MAR

12 Improved profitability Q1, 2018 EBITA increased to 325 SEK M (286) EBITA margin 9.5% (8.8%) EBITA, SEK M AND % excl. items affecting comparability COMMENTS - Improved profitability in 3 out of 4 divisions - Focused efforts in all divisions including positive effects from restructuring program Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q Quarter Rolling 12 mths INTERIM REPORT JAN - MAR

13 Cash flow and Net debt CASH FLOW FROM OPERATIONS GENERATED SEK M 221 (132) 2018 SEK M Net Debt as of Dec 31, Comments Cash flow from operating activities -221 Capex 20 Acquisitions and Earn Outs 74 2 acquisitions Dividend - Buyback of shares - Other 16 Net Debt as of Mar 31, Net Debt/EBITDA 2.2 INTERIM REPORT JAN - MAR

14 Q Infrastructure division Strong growth and increased profitability Investments in Norway and Sweden on high levels. Demand for smart solutions for plants, buildings and urban planning. Also high demand for ÅF s strong architecture and design brands. New orders from Swedavia, Rhône-bridge Switzerland, design of biomass plant, Germany. In January, acquistion of Gottlieb Paludan Architects, Denmark Jan Mar 2018 Jan Mar 2017 Full year 2017 Net sales, SEK M EBITA, SEK M EBITA % Average FTEs Total growth, % of which organic growth, % adjusted/underlying organic growth, % Comparing numbers for growth 2017 are not available due to the fact that 2016 numbers have not been adjusted with regard to changes in organisation INTERIM REPORT JAN - MAR

15 Q Industry division Stable profitability and slowed growth due to resource shortage Continued good demand. Automotive shows high activity, as well as life science and chemical/petrochemical. Strong international demand in pulp & paper New orders from the world s largest dissolving pulp mill, Sappi in South Africa, automation order from Stockholm Vatten och Avfall and product development assignments from Volvo Cars Jan Mar 2018 Jan Mar 2017 Full year 2017 Net sales, SEK M EBITA, SEK M EBITA % Average FTEs Total growth % of which organic growth, % adjusted/underlying organic growth, % Comparing numbers for growth 2017 are not available due to the fact that 2016 numbers have not been adjusted with regard to changes in organisation INTERIM REPORT JAN - MAR

16 Q Energy Division Improved profitability and in a continued weak European market. Traditionally new assignments are fewer in the beginning of the year. Market is largely unchanged. In Scandinavia refurbishment of existing installations is still moderately strong and investments in smart grids continues. The market for nuclear related services has picked up and renewables is gaining momentum. New orders include services of nuclear installations, geothermal renewable project in Turkey, and a new hydropower plant in Asia. Jan Mar 2018 Jan Mar 2017 Full year 2017 Net sales, SEK M EBITA, SEK M EBITA % Average FTEs Total growth, % of which organic growth, % adjusted/underlying organic growth, % Comparing numbers for growth 2017 are not available due to the fact that 2016 numbers have not been adjusted with regard to changes in organisation INTERIM REPORT JAN - MAR

17 Q Digital Solutions Increased profitability and slowed growth due to resource shortage Continued strong demand for digital solutions. Clients demand long term partnership in product development, Electrolux is one example. The defence industry continues to be strong. Extended partnership with Electrolux including transfer of approx 50 R&D engineers to ÅF. Small digital business in Sweden was acquired and the integration of InUse goes as planned. Jan Mar 2018 Jan Mar 2017 Full year 2017 Net sales, SEK M EBITA, SEK M EBITA % Average FTEs Total growth, % of which organic growth, % adjusted/underlying organic growth, % Comparing numbers for growth 2017 are not available due to the fact that 2016 numbers have not been adjusted with regard to changes in organisation INTERIM REPORT JAN - MAR

18 Summary - Development divisions, Q1 Division Infrastructure Industry Energy Digital Solutions Share of net sales 42% 32% 10% 16% Growth 10.8% 0.3% -2.6% 4.1% whereof organic growth adjusted/underlying organic growth 3.2% -0.9% -2.6% -0.7% 5.4% 0.4% 0.2% 0.9% EBITA margin 11.3% 8.8% 4.0% 10.2% INTERIM REPORT JAN - MAR

19 OUR VISION Providing leading solutions for generations to come. ÅF Making Future. INTERIM REPORT JAN - MAR

20 OUR MISSION We create sustainable engineering and design solutions INTERIM REPORT JAN - MAR

21 Strategy execution GROWTH VALUE CREATION OPERATIONS PEOPLE International expansion into leading positions Business model shift to deliver higher value Operational excellence Best in class people practices Geographical expansion in core countries International growth in selected niches Expansion in international investment projects Increase share of projects and solutions Cross ÅF solutions to meet global growth drivers Invest in and develop concepts and selected products Optimisation of professional services Simplified and focused organisation Adjusted financial steering Optimised pricing and sourcing Ethical commitment Leadership development People engagement and development Employer branding Recruitment and onboarding Diversity and inclusion INTERIM REPORT JAN - MAR

22 Our revised Business Model % Concepts/Solutions 61% Projects 39% Service PRODUCTS CONCEPTS SOLUTIONS Operating Satellites After market 24/7 Turn key projects Professional Teams Fixed price projects Professional services Time & Material Projects SERVICE PROJECTS Direction Claiming the value chain and increase value add to our clients Scalable and repetitive delivery Leverage from our extensive competence portfolio - cross disciplinary projects INTERIM REPORT JAN - MAR

23 Three main tracks in the strategy implementation 1. ENGAGE AND INVOLVE EVERYONE Future ÅF Programme Visualize strategy and vision + continuous communication (e.g. Future Tour Leadership support & training 2. DRIVE CROSS-ÅF SOLUTIONS & BUSINESS DEVELOPMENT Develop solutions in Smart Cities Business Development function Programmatic M&A 3. IMPLEMENT REVISED STRUCTURES AND TOOLS New organization Revised Performance Management Revise incentive models INTERIM REPORT JAN - MAR

24 Strengthen our position WHO WE ARE HOW WE WIN OUR VISION GROWTH DRIVERS OUR STRATEGY Providing leading solutions for generations to come ÅF Making Future OUR VALUES WE ARE Brave Devoted Team Players OUR MISSION We create sustainable engineering and design solutions Smart infrastructure and cities Future mobility Industrial digitalization Changing energy markets GROWTH International expansion into leading positions VALUE CREATION Business model shift to deliver higher value OPERATIONS Operational excellence PEOPLE Best in class people practices INTERIM REPORT JAN - MAR

25 SUSTAINABILITY AT ÅF Choices that make a difference Improved sustainable performance - SBPI Our clients assess that we to a higher degree contribute with sustainable value Our employees are more aware of how we contribute with sustainable value in our assignments. The initiative New Immigrated Engineers has resulted in more than 70 recruitments INTERIM REPORT JAN - MAR

26 WORKING AT ÅF Attractive workplace 1. Ikea 2. ÅF 3. Google We are one of Sweden s most popular employers among young professionals. Our ambition is to attract, develop and retain the best talents in the world, wherever we meet them. INTERIM REPORT JAN - MAR

27 Financial targets GROWTH 10 % organic growth and add on acquisitions Platform acquisitions on top EBITA MARGIN 10 % over a business cycle NET DEBT Net debt/ebitda 2.5 INTERIM REPORT JAN - MAR

28 Q1 summary NET SALES SEK M (3 265) +4.6% EBITA 325 SEK M (286) +13.5% Improved profit and margin Overall favourable market Good demand in all divisions Slowed organic growth due to resource shortage Continued focus on strategy execution INTERIM REPORT JAN - MAR

29 Thank you!