Kreate Group Plc · OMXHEX:KREATE
Kreate — Q1 2022 Earnings Presentation
20 slides from Kreate's earnings presentation, Apr 27, 2022
Slide 1: Revenue increased and order backlog at a high level
REVENUE INCREASED AND ORDER BACKLOG AT A HIGH LEVEL TIMO VIKSTRÖM, PRESIDENT & CEO MIKKO LAINE, CFO 2 7 AP R 2 0 2 2 K R E AT E G R O U P P L C / I N T E R I M R E P O R T 1 - 3 / 2 0 2 2
Slide 2: January–March 2022 in brief
JANUARY–MARCH 2022 IN BRIEF 1. 3. 5. Order backlog amounted to EBITDA was EUR 2.1(1.7) Free cash flow from operating EUR 208.8 (158.3) million million, amounting to 4.2% activities was EUR -1.2 (+0.1) (4.4%) of revenue million Revenue was EUR EBITA was EUR 1.1 (0.9) Revenue and operating profit rose
Slide 3: Forces of change in Kreate's operating environment
FORCES OF CHANGE IN KREATE’S OPERATING ENVIRONMENT § € SOCIETY LEGISLATION POLITICS ECONOMY ENVIRONMENT TECHNOLOGY Labour shortage Zoning and construction Public sector’s Growing government Life-cycle thinking Production methods legislation capability for debt and low-carbon Data manag
Slide 4: Possible impacts of Russia's war in Ukraine on Kreate's operations
POSSIBLE IMPACTS OF RUSSIA’S WAR IN UKRAINE ON KREATE’S OPERATIONS If the situation drags on, financial growth may 2023 be weaker. Any possible stimulus activities from the public sector and the transition away from Russian energy and raw materials will create markets and opportunities for infrast
Slide 5: Kreate's markets continued to develop favourably
KREATE’S MARKETS CONTINUED TO DEVELOP FAVOURABLY BUSINESS FUNCTIONS MARKET SHARE OF KREATE’S POSITION AND MEASURES DEVELOPMENT Q1/2022 KREATE’S AND 12-MO OUTLOOK* REVENUE STRUCTURAL ENGINEERING In January–February, revenue growth in Structural engineering was driven by an uptick in housing and repai
Slide 6: Highlights for January–March 2022
HIGHLIGHTS FOR JANUARY–MARCH 2022 Joint project venture Seila completed the Kreate won the Early Contractor Massive Kupittaa–Turku track project development stage and started construction of Involvement contract for the Kirkkonummi started: Kreate Rata won the first railway main road 19 Seinäjoki–La
Slide 7: Personnel
PERSONNEL ON AVERAGE 407 392 376 378 I N J U RY COMMENTS BY PERSONNEL: F R E Q U E N C Y R AT E 1 2 “Good team spirit and working towards a common MONTHS ROLLING goal bring out the best in everyone and that makes 7.4 work more meaningful as well as helps quality and efficiency." (0 7 accidents 1–3/2
Slide 8: Financial report
FINANCIAL REPORT MIKKO LAINE, CFO 8
Slide 9: Order backlog at a record level
ORDER BACKLOG AT A RECORD LEVEL ORDER BACKLOG Q1/2020–Q1/2022, EUR MILLION At the end of March 2022, the order backlog 209 amounted to EUR 208.8 (158.3) million and its 200 expected profitability was at a normal level The largest additions during the reporting period 162 158 were main road 19 Se
Slide 10: Revenue grew in January–March 2022
REVENUE GREW IN JANUARY–MARCH 2022 REVENUE, EUR MILLION REVENUE DISTRIBUTION 1-3/2022 (1-3/2021) 250 235.3 237.6 Q1 62.0 BY BUSINESS FUNCTION BY CLIENT GROUP 200 75.8 34 % (40%) 32 % 150 (15%) 65.4 70.6 44 % (43%) 100 50.4 66 % 50 (60%) 24 % +32% –23% (42%) 50.0 50.4 Structural engineering 38.3 Citi
Slide 11: No significant changes in project profitability levels
NO SIGNIFICANT CHANGES IN PROJECT PROFITABILITY LEVELS EBITA (EUR MILLION) In January–March 2022, EBITA grew compared 12.0 to the reference period, amounting to EUR 1.1 10.5 10.5 (0.9) million Q1 Profitability grew as expected alongside 9.0 2.3 3.1 revenue growth The cost increases during 2021
Slide 12: Key figures: January–March 2022
KEY FIGURES: JANUARY–MARCH 2022 EUR million 1–3/2022 1–3/2021 1–12/2021 Order backlog 208.8 158.3 202.8 Revenue 50.4 38.3 237.6 EBITDA 2.1 1.7 14.2 EBITDA, % 4.2 4.4 6.0 EBITA 1.1 0.9 10.5 EBITA, % 2.2 2.3 4.4 Operating profit 1.0 0.8 10.4 Operating profit, % 2.1 2.2 4.4 Result for the period 0.6 -0
Slide 13: Investments early in the year affected cash flow
INVESTMENTS EARLY IN THE YEAR AFFECTED CASH FLOW FREE CASH FLOW FROM OPERATING ACTIVITIES, EUR MILLION 18.0 Q1 Free cash flow from operating activities in 12.0 January–March was EUR -1.2 (0.1) million 9.7 6.0 4.0 The company’s net investments were EUR -1.8 (-0.8) million. Investments were made w
Slide 14: Interest-bearing net debt and equity ratio
INTEREST-BEARING NET DEBT AND EQUITY RATIO INTEREST-BEARING NET DEBT (EUR MILLION) AND EQUITY RATIO (%) Kreate’s interest-bearing net debt on 31 March 40 38.2 % 38.2 % 40% 2022 was EUR 23.1 million (31 March 2021: 36.8 % EUR 18.8 million) 35 35% During the reporting period, Kreate signed an 30 3
Slide 15: Interest-bearing debt – maturity and average interest
INTEREST-BEARING DEBT – MATURITY AND AVERAGE INTEREST LOAN PORTFOLIO ON 31 MARCH 2022, REPAYMENT SCHEDULE FOR INTEREST-BEARING EUR MILLION DEBT ON 31 MARCH 2022, EUR MILLION 6.0 30 25 22.3 20 Average interest of interest- bearing debt, 15 excluding lease liabilities 10.0 recognised on the balance sh
Slide 16: Outlook for 2022
OUTLOOK FOR 2022 Kreate estimates that its revenue (2021: EUR 237.6 million) and EBITA (2021: EUR 10.5 million) will grow compared to 2021. Justifications: Kreate’s strong order backlog and specialisation in demanding construction as well as the stable infrastructure construction market support the
Slide 17: The future is built today
THE FUTURE I BUILT TODAY FueeUTURET BULLE TOOT?
Slide 18: A clear strategy with a view to continued profitable growth
A CLEAR STRATEGY WITH A VIEW TO CONTINUED PROFITABLE GROWTH A PROFITABLE GROWTH COMPANY WITH AN ENTREPRENEURIAL MINDSET EXECUTES THE MOST DEMANDING INFRASTRUCTURE PROJECTS AND OFFERS THE MOST INTERESTING WORKING COMMUNITY IN THE BUSINESS AS WELL AS OPPORTUNITIES FOR DEVELOPMENT. EXPANDING AND SUPPOR
Slide 19: Kreate's long-term goals
KREATE’S LONG-TERM GOALS GROWTH PROFITABILIT Y DEBT TO EQUITY RAT IO Growing the revenue EBITA margin Net debt/EBITDA to EUR 300 million > 5% < 2.0 by 2024 in the medium term through a balanced combination of organic growth and selected acquisitions KREAT E’S The aim is to distribute at least half o
Slide 20: Kreate's shareholders on 31 March 2022
KREATE’S SHAREHOLDERS ON Shareholder Shares % of shares 31 MARCH 2022 1. 2. Harjavalta Oy Tirinom Oy 1,783,689 1,000,000 19.9 11.1 3. Ilmarinen Mutual Pension Insurance 425,000 4.7 SHAREHOLDERS BY SECTOR Company 4. Valtonen Seppo Timo Johannes 412,101 4.6 13 % 5. Varma Mutual Pension Insurance 359,0