Slide 1: Presentation Q3 2024
Presentation Q3 2024 22 October 2024 .
Slide 2: Busy quarter, strong cash flows and stable results in a weaker market
Busy quarter, strong cash flows and stable results in a weaker market • Merger of Knightec and Semcon, reconstruction in Plantasjen and restructuring in Expin Group • Continued strong development in Industry • Temporarily weak quarter in Construction & Services with tough comparisons in Construction
Slide 3: Business Areas
Business Areas 3 .
Slide 4: Industry: Adj EBITA growth of 21% and EBITA-margin at 9.7%
Industry: Adj EBITA growth of 21% and EBITA-margin at 9.7% Segments: Industrial Services and Product Solutions Comments Net sales LTM +1% SEKm 10,279 10,409 • Merger of Knightec and Semcon • Positive organic growth of 8% in the 7,014 Technical consultancy companies • Net sales decreased 2%, whereof
Slide 5: Segment financials - Industry Q3 2024
Segment financials - Industry Q3 2024 Industrial Services Product Solutions Net Sales Net sales SEK 1,233m (1,297), -4% Net sales SEK 1,203m (1,190), +1% Share of total group sales 17% Share of total group sales 16% Sales was negatively affected by Sales was negatively affected by weak CRO market we
Slide 6: Overview of HL Display
Overview of HL Display Company overview Geographic footprint Sales distribution (2023) Founded in 1954, HL Display is a European footprint Sales by region Other HL Partners leader in in-store communication 1% Central and merchandising solutions South West 6% 8% helping customers to build 28% attra
Slide 7: Investment highlights
Investment highlights Leading position in an attractive market, fuelled by supportive long-term market trends Diversified blue-chip customer base, built on long-lasting relationships Organic development ahead of the grocery market’s growth rate Clear focus on sustainability, with industry-leading pr
Slide 8: HL Display's financial development over time
HL Display’s financial development over time Financial development over time for HL Display (excluding Kostklip) (MSEK) Operating EBITA % Operating EBITA Net sales 14% +33.7% EBITA CAGR 12% 2,669 11% 11% 11% 2,344 9% 1,889 1,708 1,554 1,594 1,520 1,445 6% 3% 382 293 142 163 191 203 50 106 2017 2018
Slide 9: HL Display's Buy & Build journey so far
HL Display’s Buy & Build journey so far At acquisition Post acquisition Target Year Market Sales EURm Organic sales Synergies Kostklip 2024 18 Too early Effekt Grafik 2024 7 Too early PR trading 2024 21 → Too early Werba 2023 14 (2X) Oechsle 2023 14 → Akriform 2023 8 → APOS 2022 2 Display Italia 202
Slide 10: Overview of Kostklip
Overview of Kostklip Company overview ESL market forecast* ESL penetration curve Kostklip has served the North North America, USDbn Directional American retail market since 1969 with an offer of in-store communication Penetration and shelf management solutions The company has annual sales of 1.5
Slide 11: Construction & Services: Strong order intake growth, R12, at SEK 18.326m
Construction & Services: Strong order intake growth, R12, at SEK 18.326m Segments: Construction and Critical Infrastructure Comments Net sales LTM Order backlog Order intake LTM 18,326 SEKm -7% SEKm 17,767 • Net sales decreased 7%, whereof 16,491 34,697 13,996 29,144 29,580 organic growth -2%. Large
Slide 12: Segment financials - Construction & Services Q3 2024
Segment financials - Construction & Services Q3 2024 Construction Critical Infrastructure Net sales SEK 2,858m (3,318), -14% Net Sales Share of total group sales 38% Net sales SEK 1,015m (838), +21% Share of total group sales 14% Temporarily weak sales in Construction Large negative currency effects
Slide 13: Consumer: Reconstruction in Plantasjen
Consumer: Reconstruction in Plantasjen Segments: Consumer Comments Net sales LTM SEKm -8% • Net sales decreased 15%, whereof 6,424 5,938 5,455 -11% organic, driven by Plantasjen • Adj EBITA SEK -56m (-67) • Plantasjen’s adj EBITA SEK -86m (-100), PY negatively affected by inventory reduction program
Slide 14: Financials
Financials 14 .
Slide 15: Net sales and adjusted EBITA
Net sales and adjusted EBITA SEKm LTM 32,353 SEKm LTM 2,254 -9% -6% 7,971 7,454 7,039 517 469 432 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2022 2023 2024 2022 2023 2024 • Negative net sales growth of 6% in the quarter • Adjusted EBITA down 9% in the quarter whereof -4% organic growth •
Slide 16: Cash flow from operating activities
Cash flow from operating activities SEKm LTM 2,925 Cash flow from operating activities, SEKm Q3 2024 Q3 2023 FY 2023 -9% EBIT 159 481 3,010 Adjustment for non-cash 570 349 565 items Received dividends and -103 -136 -430 financial items, net 862 736 783 Income tax paid -50 5 -316 Change in NWC 206 16
Slide 17: Net working capital
Net working capital SEKm NWC 4QTR average % LTM net sales Net working capital, 2024 2023 2023 SEKm Sep Sep Dec Inventories 1,839 2,135 1,868 979 Trade receivables 2,915 3,166 3,277 -98% 683 Contract assets 756 1,154 725 3.4% 3.3% Accounts payable 2,409 2,732 2,803 Contract liabilities 1,631 1,782 2,
Slide 18: Adj EBITA down 9%
Adj EBITA down 9% Net sales bridge, SEKm Net sales 7,971 64 • Net sales down 6% in the quarter 299 • Acquired growth of 1% in the quarter 281 • Negative organic sales growth of 4% in the 7,454 quarter, mainly driven by Construction and Consumer segments. Positive organic sales Q3 2023 Acquired/dispo
Slide 19: Leverage, ROCE and ROIC
Leverage, ROCE and ROIC Leverage development Leverage Leverage reported Leverage adjusted • Leverage at 0.7x in Q3 2024, below the 2.5x target range (1.5x – 2.5x) 2.2x • Leverage at 1.2x excluding reversal of write- down of the holding in Aibel • Decreased leverage in the quarter due to 1.6x S decre
Slide 20: Financial targets
Financial targets Targets 2025 Outcomes Q3 2024 EBITA growth SEK 3 billion SEK 2,254m EBITA is to amount of at least SEK 3 billion by 2025 (Adjusted EBITA LTM) Leverage 1.5 – 2.5x 0.7x (non-adjusted) 1.2x (adjusted) Net debt, excluding financial lease liabilities, in relation to EBITDA should normal
Slide 21: Final Remarks
Final Remarks 21 .
Slide 22: Final remarks
Final remarks • Merger of Knightec and Semcon, reconstruction in Plantasjen and restructuring in Expin Group • Continued strong development in Industry • Temporarily weak quarter in Construction & Services with tough comparisons in Construction • Strong order backlog and order intake, R12, in Constr
Slide 23: Q&A
Q&A 23 .
Slide 24: Our financial segment reporting
Our financial segment reporting Industry Construction & Services Consumer Industrial Services Product Solutions Critical Infrastructure Construction Consumer 24
Slide 25: Ratos Group and Business areas
Ratos Group and Business areas Net sales, Adj EBITA and Adj EBITA-margin Q3 Q3 Change Net sales, SEKm 2024 2023 % Industry 2,428 2,465 -2% Construction & Services 3,873 4,155 -7% Consumer 1,154 1,351 -15% Elimination of internal net sales -0 Net sales 7,454 7,971 -6% Q3 Q3 Change Adj EBITA, SEKm 202