Interim report January – March 2022 Sweco AB (publ)
A positive start to the year
January – March 2022
- Net sales increased to SEK 6,077 million (5,538)
- EBITA increased to SEK 648 million (540), margin 10.7 per cent (9.8)
- EBITA increased 2 per cent year-on-year after adjustment for calendar effects
- EBIT increased to SEK 629 million (523), margin 10.4 per cent (9.4)
- Net debt amounted to SEK 997 million (957)
- Net debt/EBITDA decreased to 0.4 x (0.5)
- Profit after tax increased to SEK 463 million (392), corresponding to SEK 1.29 per share (1.10)
Comments from President and CEO Åsa Bergman:
We started the year with solid organic growth and a stable overall performance, despite a high level of sickness absence due to Covid-19. Four out of eight business areas report EBITA improvements, the demand for Sweco’s services remained good and we continued to strengthen our order book. We also continued to act on opportunities in the market and announced two new acquisitions in the quarter.
We delivered positive FTE growth and our ambition is to continue to accelerate recruitment going forward. In the fierce competition for talent, Sweco’s strong employer brand is a key strength for us.
Among the projects won in the first quarter, I would like to highlight two projects related to the growing demand for sustainable mobility and public transportation. We won three out of four projects for Stockholm’s new metro line, covering services in environmental impact analysis and the design of new stations. We also won a ten-year railway project in the Öresund Region. These project wins reflect Sweco’s position as a European leader in railway design.
Solid operational development and strong financial position
Net sales in the first quarter increased to SEK 6,077 million (5,538), with organic growth of 3 per cent, adjusted for calendar effects. EBITA amounted to SEK 648 million (540), resulting in an EBITA margin of 10.7 per cent (9.8). The positive development is supported by higher average fees, FTE growth, and positive calendar effects, while high levels of sickness absence had a significant negative impact.
The organic growth was positive in six out of eight business areas, and four out of eight business areas reported higher EBITA adjusted for calendar effects compared with the same period last year. The positive Group result is linked to strong quarters in Norway, Belgium and Denmark, as well as continued improvements in Germany. The result was negatively impacted by high levels of sickness absence across our business areas, but most notably in the Netherlands and Sweden.
Sweco’s financial position remains strong, with low net debt and significant available liquid assets.
Two new acquisitions
We announced two new acquisitions in the quarter. The Norwegian consultancy Stema Rådgivning is a renowned expert in project and construction management, with 90 employees and total sales of NOK 177 million in 2021. Adding their expertise, Sweco can capture an even larger share of the Norwegian market.
Swedish Net Engineering, with 28 employees, is an expert in physical and technical protection and security. This is a good complement to our expertise in buildings and well aligned with the increasing demand for security solutions.
These acquisitions highlight our strategy to add leading expertise to Sweco’s offering and address interesting growth segments through acquisitions.
We stand by Ukraine
The Russian invasion of Ukraine is a serious and unacceptable violation of international law and human rights. We offer our support to Ukraine, both through donations and by offering Sweco’s expertise. Sweco does not have any employees working in Russia or Ukraine, and we decided early on to terminate the few export projects ongoing in Russia and Belarus.
Accelerated transformation drives demand for our services
The short- and long-term consequences of the war in Ukraine, together with the major transformative changes brought about both by digitalisation and by climate adaptation, will challenge and place demands on our societies and on business.
It is clear to me that Sweco has both an important role to play and an ability to contribute and grow with these challenges. It feels more relevant, challenging and inspiring than ever before.