Slide 1: Interim report Q4 & full year 2019
Interim report Q4 & full year 2019 1 2020-01-30 NCC AB
Slide 2: Tomas Carlsson, CEO
Tomas Carlsson CEO 2 2020-01-30 NCC AB
Slide 3: Welcome to our new office
Welcome to our new office 3
Slide 4: Ending 2019 with a strong Q4
Ending 2019 with a strong Q4 Q4 2019 • Earnings improved and net sales up • Strong cashflow • Orders received down but order backlog on strong level Proposed dividend • Somewhat more cautious in the market mainly in Sweden SEK 5.00 per share Full Year 2019 – improving in line with plan • Earnings im
Slide 5: NCC in 2019: Sweden remaining the largest market but orders received in Denmark doubled
NCC in 2019: Sweden remaining the largest market but orders received in Denmark doubled Orders received per country Net sales per country 14% 11% 12% 13% 11% 12% 15% 15% 2018 2019 55% 2018 2019 58% 62% 14% 62% 9% 23% 14% Sweden Denmark Norway Finland 5 2020-01-30 NCC AB
Slide 6: Accident frequency going down
Accident frequency going down LTIF Group 1 Day 500 16 14.4 14 400 407 10.9 12 10.6 9.5 8.8 10 300 315 300 8.0 7.5 7.2 7.0 8 257 241 246 200 202 204 6 176 4 100 2 0 0 2011 2012 2013 2014 2015 2016 2017 218 2019 Number of accidents LTIF 1 Day 6
Slide 7: Order backlog stronger than previous years
Order backlog stronger than previous years SEK M 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Q1 2017 Q2 Q3 Q4 Q1 2018 Q2 Q3 Q4 Q1 2019 Q2 Q3 Q4 7 2020-01-30 NCC AB
Slide 8: Orders received
Orders received Down in Road Services, BU SE and Infrastructure – up in BU Nordics Q4 Full Year SEK M SEK M 70,000 70,000 60,000 60,000 50,000 50,000 40,000 40,000 30,000 30,000 56,777 61,842 58,048 20,000 20,000 10,000 16,223 17,750 10,000 13,708 0 0 Q4 2017 Q4 2018 Q4 2019 2017 2018 2019 8 2020-01
Slide 9: Residential orders received
Residential orders received SEK M 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2019 Orders received residential NCC average 9 2020-01-30 NCC AB
Slide 10: Net Sales
Net Sales Net sales growing SEK M SEK M Q4 Full year 70,000 70,000 60,000 60,000 50,000 50,000 40,000 40,000 30,000 30,000 57,346 58,234 54,441 20,000 20,000 10,000 16,273 17,832 18,239 10,000 0 0 Q4 2017 Q4 2018 Q4 2019 2017 2018 2019 10 2020-01-30 NCC AB
Slide 11: Q4 2019: Earnings improving
Q4 2019: Earnings improving Improvements in all business areas supported by sale of property SEK M Q4 700 670 Operating margin 600 500 400 2019 3.7% 300 256 200 2018 1.4% 100 -43 0 -100 Q4 2017 Q4 2018 Q4 2019 11 2020-01-30 NCC AB
Slide 12: Full year 2019: Improved earnings
Full year 2019: Improved earnings SEK M 1,400 Operating margin 1,200 1,296 (NCC total) 1,000 1,075 800 600 2019 2.2% 400 200 2018 -1.3% 0 -200 -400 -600 -764 -800 2017 2018 2019 12 2020-01-30 NCC AB
Slide 13: Full year 2019: Comparison with 2018
Full year 2019: Comparison with 2018 Earnings without SEK M revaluations during 2018 1,400 1,200 1,296 1,000 1,075 800 600 400 953 200 0 -200 -400 -600 -764 -800 2017 2018 2019 13 2020-01-30 NCC AB
Slide 14: Full year 2019: Improved earnings without PD
Full year 2019: Improved earnings without PD NCC without Property Development Business Area Property Development SEK M SEK M 1,400 1,400 1,200 1,200 1,000 1,000 800 983 800 600 600 400 601 474 400 200 200 313 0 0 -200 -181 -200 -400 -583 -400 -600 -600 -800 2017 2018 2019 -800 2017 2018 2019 14 2020
Slide 15: Proposed dividend 5,00 SEK per share
Proposed dividend 5,00 SEK per share 2.50 SEK 2.50 SEK 3 April 2020 2 November 2020 15 2020-01-30 NCC AB
Slide 16: Financial objectives and dividend policy
Financial objectives and dividend policy Operating Net debt Return Dividend policy margin on equity ≥ 4.0% < 2.5 ≥ 20% ≥ 40% x EBITDA of profit after tax 2019 Proposed 2.2% 0x 32% 5,00 SEK per (-1.3%) (0.6x) (-18%) share 62% of profit after tax 16 2020-01-30 NCC AB
Slide 17: Susanne Lithander, CFO
Susanne Lithander CFO 17 2020-01-30 NCC AB
Slide 18: Balanced business areas
Balanced business areas Net sales 2019 EBIT* 5% 19% 14% 19% 34% 22% 19% 31% 23% 14% NCC Infrastructure NCC Building Sweden NCC Building Nordics NCC Industry NCC Property Development *according to segment reporting 18 2020-01-30 NCC AB
Slide 19: NCC Infrastructure
NCC Infrastructure Primarily Sweden and Norway – Centralen project in orders received 2018 Orders received 2019 Net Sales 2019 Roads 22 (14)% Roads 21 (18)% Railways 4 (35)% Railways 14 (9)% Groundworks 36 (24)% Groundworks 34 (30)% Energy and Water Treatment 22 (12)% Energy and Water Treatment 19 (
Slide 20: NCC Infrastructure
NCC Infrastructure Earnings stabilized and improving – Road Services positive result Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Orders received 3,868 5,796 16,601 21,271 Order backlog 20,389 21,037 20,389 21,037 Net sales 5,371 5,134 17,425 16,936 EBIT 78 -144 212 -743 EBIT margin, %
Slide 21: NCC Building Sweden
NCC Building Sweden Residential 1/3 of both net sales and orders received; 2/3 rental units Orders received 2019 Net Sales 2019 Offices 13 (9)% Residential 30 (17)% Offices 6 (8)% Residential 29 (33)% Industry/Logistics 2 (6)% Refurbishment/Conversion 24 (22)% Industry/Logistics 4 (4)% Refurbishment
Slide 22: NCC Building Sweden
NCC Building Sweden Some departments still in turnaround Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Orders received 4,107 5,893 12,741 15,075 Order backlog 16,561 18,709 16,561 18,709 Net sales 4,264 4,614 14,851 15,701 EBIT 103 109 364 453 EBIT margin, % 2.4 2.4 2.5 2.9 22 2020-01-30
Slide 23: NCC Building Nordics
NCC Building Nordics Orders received 2019 Net Sales 2019 Offices 13 (8)% Residential 32 (29)% Offices 13 (17)% Residential 31 (29)% Industry/Logistics 2 (6)% Refurbishment/Conversion 21 (31)% Industry/Logistics 6 (4)% Refurbishment/Conversion 30 (28)% Retail 0 (1)% Health Care 19 (1)% Retail 1 (2)%
Slide 24: NCC Building Nordics
NCC Building Nordics Strong order backlog and improving results in all countries Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Orders received 3,001 3,477 16,080 11,229 Order backlog 15,807 11,313 15,807 11,313 Net sales 3,485 3,162 11,769 10,753 EBIT 99 -78 231 -227 EBIT margin, % 2.8 -
Slide 25: NCC Industry
NCC Industry Sweden remains the largest market Sweden 55 (55)% Denmark 19 (19)% Norway 17 (17)% Finland 9 (9)% 25 2020-01-30 NCC AB
Slide 26: NCC Industry: Stone and asphalt volumes
NCC Industry: Stone and asphalt volumes Steady volumes in stone – asphalt lower due to weather conditions in Q4 Stone material sold, thousands of tons Asphalt sold, thousands of tons 10,000 3,000 9,000 8,000 2,500 7,000 2,000 6,000 5,000 1,500 4,000 3,000 1,000 2,000 500 1,000 0 0 Q1 Q2 Q3 Q4 Q1 Q2
Slide 27: NCC Industry
NCC Industry Volumes steady – close to objective for operating margin in 2019 Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Orders received 3,040 3,058 12,852 12,943 Order backlog 2,967 3,092 2,967 3,092 Net sales 3,674 3,876 12,971 12,968 EBIT 187 155 511 350 Operating margin % 5.1 4.0
Slide 28: One new project started in Q4 – eight in total 2019
One new project started in Q4 – eight in total 2019 Four projects sold with later profit recognition No. of projects Lettable space, sqm 300,000 19 250,000 17 17 15 18 200,000 22 21 21 Sweden 19 18 18 Norway 150,000 16 Denmark Finland 100,000 50,000 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 20
Slide 29: Strong letting in full year 2019 but lower in Q4
Strong letting in full year 2019 but lower in Q4 300,000 55% 50% 250,000 45% Remaining unlet area, sqm 40% 200,000 35% Let during quarter, 30% sqm 150,000 25% Previously let area, 20% sqm 100,000 15% Let during quarter 50,000 10% (% of available unlet 5% area) 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 30: Letting and completion status in the property portfolio
Letting and completion status in the property portfolio 100% 90% 80% 70% 60% Letting ratio 50% Completion ratio 40% 30% 20% 10% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2017 2018 2019 30 2020-01-30 NCC AB
Slide 31: NCC Property Development
NCC Property Development Five projects in earnings in Q4 and sale of land with building rights in Norway Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Net sales 1,989 1,361 3,056 2,157 Operating profit/loss 273 144 313 -181 Capital employed 4,935 4,314 4,935 4,314 EBIT margin % 13.7 10.6
Slide 32: Other and eliminations
Other and eliminations Q4 Q4 FY FY Q4 Q4 FY FY SEK M 2019 2018 2019 2018 SEK M 2019 2018 2019 2018 NCC HQ and NCC Infrastructure 78 -140 212 -743 other group -100 49 -331 -177 adjustments NCC Building Sweden 103 109 364 453 Internal gains 15 27 -24 11 NCC Building Nordics 99 -78 231 -227 Other and N
Slide 33: Comment to other & eliminations
Comment to other & eliminations Depending of internal sales SEK –50 to 50 M per between Building and Property Internal gains quarter last three development due to different profit years recognition methods HQ costs normally Q3 seasonally lower than other HQ costs steady over time quarters due to vac
Slide 34: Income statement
Income statement Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 Net sales 18,239 17,832 58,234 57,346 Gross profit 1,497 1,047 4,101 2,140 Selling and administrative expenses -829 -799 -2,811 -2,875 Cost ratio 4.5% 4.5% 4.8% 5.0% Other 2 8 6 -29 EBIT 670 256 1,296 -764 Financial items -31
Slide 35: Net debt per December 31
Net debt per December 31 5,000 4,489 Net debt* / EBITDA 4,000 ** 1,732 R12 0x 3,045 3,000 493 Leasing liabilities (incl IFRS 16) 2,000 Pension liability Corporate net debt *Net debt excluding pension 2,279 2,840 liabilities and leasing liabilities 1,000 according to IFRS16 and from this quarter not
Slide 36: Cashflow very strong in Q4
Cashflow very strong in Q4 SEK Bn Cash flow before financing R12 4 Oct-Dec Oct-Dec Jan-Dec Jan-Dec SEK M 2019 2018 2019 2018 3 From operating 3,381 2,281 3,379 790 activities 2 From property 349 -221 -1,165 -1,166 projects 1 Investing -155 -119 -701 -782 activities 0 Cash flow Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 37: Tomas Carlsson, CEO
Tomas Carlsson CEO 37 2020-01-30 NCC AB
Slide 38: Ending 2019 with a strong Q4
Ending 2019 with a strong Q4 Q4 2019 • Earnings improved and net sales up • Strong cashflow • Orders received down but order backlog on strong level Proposed dividend • Some more caution in the market mainly in Sweden SEK 5.00 per share Full Year 2019 – improving in line with plan • Earnings up comp
Slide 39: NCC AB
39 2020-01-30 NCC AB