Slide 1: Merko Ehitus Group 9 months and III quarter 2014
MERKO EHITUS GROUP 9 months and III quarter 2014 November 2014
Slide 2: Agenda
Agenda 1. Key highlights 2. Business review at segment level 3. Financial position 4. Market outlook 5. Group in brief 2
Slide 3: Key highlights
Key highlights EUR millions 9M 9M Var Q3 Q3 Var 12M 2014 2013 2014 2013 2013 Revenue 182.2 197.8 -7.9% 68.5 84.1 -18.5% 262.7 Gross profit 16.3 17.4 -6.4% 6.2 7.5 -18.1% 22.7 Gross profit margin (%) 8.9 8.8 +1.6% 9.0 9.0 +0.6% 8.6 EBITDA 10.2 11.6 -12.2% 4.1 5.3 -23.3% 15.1 Net profit, attr. to equi
Slide 4: Business review – 9 months
Business review – 9 months REVENUES Strong performance from general construction (revenues up by 43.3% y-o-y) and real estate development segment (up by 36.3%). Decrease of revenues in road construction (down by 45.7%) and civil engineering segment (down by 38.8%). No comparable amount of EU fun
Slide 5: Business review – Q3
Business review – Q3 REVENUES Increase in general construction segment revenues (up by 9.5% y-o-y). Decrease of revenues in road construction segment (down by 40.7%), civil engineering segment (down by 26.4%). Private sector orders have not increased for the group at the volumes anticipated at
Slide 6: Real estate development – apartments
Real estate development – apartments Objective to keep the adequate level of inventory to meet the market demand, new project launch depending on market conditions at the time. REVENUES 36.3% increase of revenues compared to 9M 2013. Increased focus on our own developments. Q3 37 apartments (EUR
Slide 7: Secured order book
Secured order book Secured order book 23.7% lower compared to last year. EUR 37.2m worth of new contracts signed in Q3 2014 compared to EUR 109.8m during Q3 2013. 9M 2014 new contracts value amounted to EUR 107.5m vs EUR 205.7m in 9M 2013. Q3 2013 includes very large contracts signed in Estonia
Slide 8: Financial position
Financial position Group’s strong liquidity position maintained, cash at EUR 40.3m. The net debt almost nil (EUR 0.1m) and debt ratio is at a modest level of 15.7% (30.09.2013: EUR -4.5 and 13.9%). Group has drawn more loans to support own developments in Q3. Current assets are at 2.2x current
Slide 9: Stock Exchange overview
Stock Exchange overview No of % of total % of total Shareholders Variance shares 30.09.2014 30.06.2014 AS Riverito (management) 12 742 686 71,99% 71,99% - ING Luxembourg S.A. AIF Account 974 126 5,50% 5,50% - Skandinaviska Enskilda Banken S.A. 469 378 2,65% 2,71% -10 149 Firebird Republics Fund Ltd
Slide 10: Market outlook: construction
Market outlook: construction We are forecasting a continuing decline in the volume of Baltic construction contracts for general contractors. Continuing decrease of public sector procurements due to the switchover to the new EU funding period and uncertainties around allocation of funds by sectors
Slide 11: Market outlook: real estate
Market outlook: real estate Number of transactions and price per m2 have shown growth trend up until 1H 2014 due to low interest rates and limited supply of new flats during the last few years. Still good potential to start new developments in all Baltic capitals, however clients are increasingl
Slide 12: Focus going forward
Focus going forward Key challenge to increase and also keep the 2013 level of secured order book. Active positioning in residential real- estate. Closely following the developments in the nearby markets and new opportunities. Aim to identify non-Baltic revenue potential at acceptable risk leve
Slide 13: Group in brief
Group in brief Construction services: Operates in Estonia (81% of revenue), • General construction Latvia (17%), Lithuania (2%) • Engineering construction • Road construction Own developed real estate projects The largest listed construction company in the Baltics 31.12.2013: Net Profit 2013: Share
Slide 14: Contacts
Contacts Andres Trink Signe Kukin Chief Executive Officer Chief Financial Officer E-mail: andres.trink@merko.ee E-mail: signe.kukin@merko.ee AS Merko Ehitus Delta Plaza, 7th floor Pärnu mnt. 141, 11314 Tallinn, Estonia Phone: +372 6501 250 www.group.merko.ee 14
Slide 15: Disclaimer
Disclaimer This presentation has been prepared by AS Merko Ehitus (the Company) solely for your use and benefit for information purposes only. By accessing, downloading, reading or otherwise making available to yourself any content of the presentation, in whole or in part, you hereby agree to be b