HELSINKI, Aug. 4, 2022 /PRNewswire/ —
Caverion Corporation Half-year Financial Report 4 August 2022 at 8.00 a.m. EEST
Organic revenue growth and margin improvement continued
1 April – 30 June 2022
Revenue: EUR 577.0 (545.1) million, up by 5.9 (5.1) percent, 6.5 (2.6) percent in local currencies. Organic growth was 4.7 (3.3) percent. Services business revenue increased by 7.7 (10.1) percent, 8.3 (7.1) percent in local currencies. Projects business revenue increased by 2.5 (-2.9) percent, 3.1 (-4.6) percent in local currencies.
Adjusted EBITA: EUR 22.9 (19.7) million, or 4.0 (3.6) percent of revenue, up by 16.0 percent.
EBITA: EUR 21.4 (18.0) million, or 3.7 (3.3) percent of revenue.
Operating profit: EUR 17.5 (13.9) million, or 3.0 (2.5) percent of revenue.
Operating cash flow before financial and tax items: EUR -9.3 (-3.4) million.
Earnings per share, undiluted: EUR 0.09 (0.06) per share.
Acquisitions: Caverion closed four acquisitions in April–June 2022.
1 January – 30 June 2022
Order backlog: EUR 1,907.9 (1,789.0) million, up by 6.6 (2.8) percent. Services backlog increased by 4.3 (10.7) percent. Projects backlog increased by 9.8 (-6.1) percent.
Revenue: EUR 1,105.1 (1,060.4) million, up by 4.2 (0.0) percent, 4.6 (-1.8) percent in local currencies. Organic growth was 3.6 (-1.1) percent, driven by 5.2 (2.7) percent organic growth in Services. Services business revenue increased by 6.1 (3.9) percent, 6.4 (1.8) percent in local currencies. Projects business revenue increased by 0.8
(–6.5) percent, 1.3 (-7.9) percent in local currencies.
Adjusted EBITA: EUR 40.3 (36.1) million, or 3.6 (3.4) percent of revenue, up by 11.6 percent.
EBITA: EUR 36.4 (33.1) million, or 3.3 (3.1) percent of revenue.
Operating profit: EUR 28.9 (24.9) million, or 2.6 (2.3) percent of revenue.
Operating cash flow before financial and tax items: EUR 29.7 (37.2) million.
Cash conversion (LTM): 81.3 (80.3) percent.
Earnings per share, undiluted: EUR 0.13 (0.11) per share.
Net debt/Adjusted EBITDA: 1.5x (1.1x).
Acquisitions: Caverion closed five acquisitions in January–June 2022.
Unless otherwise noted, the figures in brackets refer to the corresponding period in the previous year.
Guidance for 2022: In 2022, Caverion Group’s revenue (2021: EUR 2,139.5 million) and adjusted EBITA (2021: EUR 87.7 million) will grow compared to 2021.
KEY FIGURES
Jacob Götzsche, President and CEO:
«I am pleased that we continued improving our underlying business and increased revenue and adjusted EBITA during the second quarter of 2022 compared to the previous year. I am satisfied that despite the challenging business environment we have a continued strong order backlog and a positive organic growth. This supports our sustainable profitable growth strategy going forward.
The recent changes in the geopolitical environment are expected to impact also Caverion. We divested our Russian subsidiary in the end of 2021 and have no operations in Ukraine or Belarus. Therefore, the impact of the conflict on Caverion is currently indirect. Despite these challenges in the operating environment and resulting cost inflation and rising interest rates, our performance during the second quarter of 2022 was solid. The effects of the corona pandemic gradually started to ease off during the second quarter, however the number infections started to increase again towards the end of the quarter. We remain somewhat cautious with the pandemic as unpredictable virus variants and new waves of the pandemic may continue to emerge.
Our order backlog at the end of June increased by 6.6 percent to EUR 1,907.9 (1,789.0) million compared to the previous year. The order backlog increased in Services by 4.3 percent and in Projects by 9.8 percent. In addition to the fixed contracts in Projects and Services, we also see strong demand in Services ad-hoc orders. We expect our increased order backlog to continue to support our revenue growth in 2022. Our second quarter revenue was EUR 577.0 (545.1) million, up by 5.9 percent or 6.5 percent in local currencies. Measured in local currencies, the Services business revenue increased by 8.3 percent, while the Projects business revenue increased by 3.1 percent in the second quarter. The business mix change seen in recent years continued; the Services business accounted for 66.0 (64.8) percent of Group revenue in the second quarter of 2022. As a result of the high share of our Services business, more than half of our revenue is recurring service and maintenance work.
Our profitability improved in the second quarter. The adjusted EBITA improved to EUR 22.9 (19.7) million, or 4.0 (3.6) percent of revenue. EBITA was EUR 21.4 (18.0) million, or 3.7 (3.3) percent of revenue. Particularly divisions Austria, Finland, Germany and Norway progressed well. Division Denmark continued the positive performance improvement. Both business units, Services and Projects, improved their performance during the second quarter of 2022.
Our operating cash flow before financial and tax items was EUR 29.7 (37.2) million in the first half of the year 2022 and cash conversion (LTM) was 81.3 (80.3) percent. In the first half of 2022, the cash flow was negatively impacted by the payment of EUR 8.8 million for civil claims relating to the German anti-trust matter. The respective cost was recognised in 2021 and reported in items affecting comparability in 2021. At the end of the first half of the year, our interest-bearing net debt amounted to EUR 215.4 (147.3) million, or EUR 77.5 (23.7) million excluding lease liabilities. The net debt was impacted by investments in acquisitions with a negative cash flow effect of EUR 28.4 million in January–June 2022 and dividend payment of EUR 23.2 million. We have a solid financial position, and our leverage is at a low level. The net debt/Adjusted EBITDA ratio was 1.5x (1.1x).
We have embarked on our journey towards targeted acquisitions in line with our strategy. As part of our ongoing development of our capabilities to serve our customers, we closed the acquisitions of the Danish company DI-Teknik A/S in April 2022, the Finnish service company Wind Controller and the Finnish industrial service specialist WT-Service Oy in May 2022 as well as one bolt-on acquisition in Norway in May 2022. DI-Teknik is one of Denmark’s largest industrial automation companies bringing us completely new expertise in this area. Wind Controller is the leading technical consultant and service provider for the Finnish wind power industry.
In May we launched our updated strategy and financial targets guiding us up until the year 2025. We are targeting sustainable profitable growth going forward. Our strategic priorities and actions are progressing according to the plan. We have already taken our first steps in executing on our new strategy by identifying a handful of customer solution areas in which we will set up centres of expertise, sharing knowledge by leveraging our presence across our geographies. In addition, we continue our simplification efforts in our IT landscape. We move forward in our Sustainability strategic theme by aiming to have more than 2,000 electric service vans in use by 2025. We also improved our EcoVadis sustainability rating from the silver to the gold standard and are now in the top 5% in our industry. We strongly believe in our purpose to enable building performance and people’s wellbeing in smart and sustainable built environments.»
Impacts of the Ukraine crisis on Caverion’s business during the first half of 2022
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