Ncc Group Plc · LSE:NCC
Ncc — Q4 2023 Earnings Presentation
32 slides from Ncc's earnings presentation, Jan 30, 2024
Slide 1: Q4 2023
Q4 2023 Tomas Carlsson, CEO Susanne Lithander, CFO 1 Jan 30, 2024 NCC AB Sandøy-tunnel, Faroe Islands
Slide 2: Orders received and order backlog, SEK M
Q4 2023 Orders received, SEK M Order backlog, SEK M 53,285 56,819 62,510 60,960 59,047 54,995 58,910 59,359 54,594 53,422 16,159 16,635 12,763 12,280 16,288 14,691 11,607 9,681 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2022 2023 2022 2023 2 Jan 30, 2024 NCC AB
Slide 3: Net sales and operating profit, SEK M
Q4 2023 Net sales, SEK M Operating profit, SEK M 152 -170 510 358 474 544 503 789 54,198 56,932 15,592 14,001 14,068 16,018 12,464 14,854 14,022 1,358 1,802 10,111 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2022 2023 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2022 2023 2022 2023 2022 2023 3 Jan 30, 2024 NCC AB
Slide 4: A good year for NCC in a mixed market
A good year for NCC in a mixed market Growing earnings Consistent orders Steady and positive Building Nordics – and reaching SEK 16 received and net earnings growth in large variations EPS target. sales affirming Infrastructure – between markets Proposed dividend of stability growing in selected SEK
Slide 5: Solid order backlog – book to bill >1
Solid order backlog – book to bill >1 SEK M Book to bill 70 000 1,4 60 000 1,2 50 000 1,0 40 000 30 000 0,8 20 000 0,6 62 333 59 486 54 821 50 945 56 096 58 816 54 525 55 763 62 510 60 960 59 047 54 995 58 910 59 359 54 594 53 422 10 000 0 0,4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 202
Slide 6: Q4: Stronger earnings in three BAs
Q4: Stronger earnings in three BAs – no profit recognition in property development SEK M No property divestment recognized in revenue IT and pensions 6 Jan 30, 2024 NCC AB Hammerfest Harbour, Norway
Slide 7: 2023: Strong comeback for Industry and good earnings in Infrastructure
2023: Strong comeback for Industry and good earnings in Infrastructure SEK M 7 Jan 30, 2024 NCC AB
Slide 8: Contracting margins
Contracting margins Infrastructure improves margin 21 quarters in a row %* 4 3 Infrastructure 2 Building Nordics Building Sweden Internal target 1 0 Q3 2019 Q4 Q1 2020 Q2 Q3 Q4 Q1 2021 Q2 Q3 Q4 Q1 2022 Q2 Q3 Q4 Q1 2023 Q2 Q3 Q4 *R12 EBIT margin. BA Infrastructure without Road Services and adjusted f
Slide 9: Earnings Per Share SEK 16 in 2023
Earnings Per Share 16 SEK in 2023 Earnings per share SEK ≥16.00 SEK 2023 Q4 2023 R12 8 12 14 10 16 16.11 2019 2020 2021 2022 2023 SEK 9 Jan 30, 2024 NCC AB
Slide 10: Financial targets
Financial targets Earnings per share Net debt Dividend policy ≥16.00 < 2.5 ≈ 60% SEK 2023 x EBITDA of profit after tax Proposal 2023 2023 50% of profit after tax 16.11 0.98 8.00 SEK x EBITDA SEK 10 Jan 30, 2024 NCC AB
Slide 11: Health & Safety target
Health & Safety target Target for LTIF4 2026 is 2.0 300 9,5 10,0 9,0 8,1 250 7,7 8,0 7,0 6,9 6,7 7,0 200 5,8 6,0 150 5,0 4,1 4,1 4,0 3,6 3,7 4,0 100 3,0 2,0 50 1,0 257 156 176 103 159 86 148 78 159 84 157 78 0 0,0 2018 2019 2020 2021 2022 2023 Accidents - absence 1 day or more Accidents - absence mo
Slide 12: Market outlook
Market outlook • Still uncertainty in economic outlook • However, signs of more predictability regarding inflation, interest rates and priorities • Office and residential market remains slow • Property market difficult, low activity • Strong market for infrastructure and public buildings and large i
Slide 13: Focus areas for NCC
Bild från Q3 Focus areas for NCC • Diligent project selection • Using our segment strengths • Continued execution discipline • Adapting resources where needed 13 Jan 30, 2024 NCC AB Arna Quarry, Onsala Södra Norway rymdrum, Sandby, Sweden Sweden
Slide 14: Net sales 2023
Sales SEK 57 Bn 8% New North Zealand hospital, Hillerød, Denmark Employees (10) 13% 12,200 (13) 57% (58) 22% 14 Jan 30, 2024 NCC AB (19) Net sales, 2023
Slide 15: Business split, 2023
Business split, 2023 Net sales per business area EBIT per business area Operating Capital employed SEK M 10 000 2% (2) 9 000 12% 8 000 19% (32) 7 000 (20) 30% 6 000 (30) 37% 5 000 (28) 20% 4 000 (1) 3 000 25% 2 000 4 411 4 090 7 996 9 592 (24) 1 000 24% 17% 14% 0 (24) (23) (16) Industry Property Dev
Slide 16: Segment split – orders received 2023
Segment split – orders received 2023 Infrastructure Building Sweden Building Nordics Energy & Water treatment 40% Public buildings 46% Public buildings 37% 9% 5% 7% 6% 15% 5% (6) (9) 11% (15) (18) 24% (14) 19% (10) 7% 8% (12) (5) (22) (32) (3) 46% 17% 22% (28) (18) (28) 40% 22% (28) (17) 37% (35) Ro
Slide 17: NCC Infrastructure
Share of net sales % NCC Infrastructure SE 74 DK 13 NO 13 Solid orders received Earnings improves – EBIT margin 3.1% SEK M 20 000 723 4 700 175 600 15 000 3 500 400 2 10 000 300 200 1 5 000 18 377 16 339 15 391 17 256 16 707 17 667 100 391 429 548 0 0 0 2021 2022 2023 2021 2022 2023 Orders received
Slide 18: NCC Building Sweden
NCC Building Sweden Orders received lower, compared to strong 2022 Earnings on par with last year – impact from high cost SEK M 20 000 4 700 600 15 000 3 500 400 2 10 000 300 200 1 5 000 14 369 13 868 14 711 14 178 12 661 14 475 100 457 252 272 0 0 0 2021 2022 2023 2021 2022 2023 Orders received Net
Slide 19: NCC Building Nordics
Share of net sales % NO NCC Building Nordics DK 49 16 FI 35 Growing orders received and net sales Earnings on par with 2022, variation between countries SEK M 20 000 4 700 600 15 000 3 500 400 2 10 000 300 200 1 5 000 13 297 11 324 12 321 13 568 16 654 14 615 100 410 347 343 0 0 0 2021 2022 2023 202
Slide 20: NCC Industry
NCC Industry Asphalt volumes impacted by early winter, stone volumes holds up well given the market Stone material sold, thousands of tons Asphalt sold, thousands of tons (excl Asphalt Finland) 9 000 2 000 8 000 1 800 7 000 1 600 1 400 6 000 1 200 5 000 1 000 4 000 800 3 000 600 2 000 400 199 188 13
Slide 21: NCC Industry
Share of net sales % NCC Industry SE 55 DK 23 NO 20 FI 2 Good net sales in a market with high price pressure Turnaround successful, earnings improved 20 000 SEK M 700 4 600 Operating 4,090 3 15 000 500 capital employed, 400 2 SEK M 10 000 300 ROCE, % 8,9 200 1 5 000 100 11 268 10 065 11 638 11 459 1
Slide 22: NCC Property Development
NCC Property Development One property and a land sale recognized in profit 2023 EBIT, SEK M 350 323 300 273 277 268256 250 200 179 183 150 100 68 54 47 50 40 29 42 19 1 0 -50 -20 -11 -25 -18 -37 -100 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 2020 2021 2022 2023 22 Jan 30, 2024
Slide 23: NCC Property Development – good letting in the quarter
NCC Property Development Good letting in the quarter SQM 80% 25 000 70% 20 000 60% 50% 15 000 40% 10 000 30% 20% 5 000 10% 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2021 2022 2023 Let during quarter, sqm 23 Jan 30, 2024 NCC AB
Slide 24: NCC Property Development – increased letting ratio
NCC Property Development Increased letting ratio SQM 300 000 80% 70% 250 000 60% 200 000 50% Remaining unlet area, sqm 150 000 40% Let during quarter, sqm 30% *Sold, no letting 100 000 20% Previously let area, sqm 50 000 10% Let during quarter (% of available unlet area) 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 25: NCC Property Development projects
NCC Property Development Operating 9,592 7 ongoing projects, 4 completed projects capital employed, SEK M Expected time of profit recognition for sold projects ROCE, % 2,8 2024 2025 2026 2027 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Arendal Albatross MIMO Park Central Ongoing unsold projects Comple
Slide 26: Earnings
Earnings Q4 Jan-Dec SEK M 2023 2022 2023 2022 Earnings in segments (all BAs) 543 609 1,982 1,518 NCC HQ and subsidiaries -139 -26 -310 -131 Internal gains -31 -24 -18 -44 Other group adjustments -14 -15 149 15 Other & Eliminations total -184 -65 -179 -161 EBIT 358 544 1,802 1,358 Financial items -4
Slide 27: Cash flow
Cash flow SEK M Q4 Jan-Dec 2 000 SEK M 2023 2022 2023 2022 1 500 From operating 1 389 activities 599 690 2,122 1,997 1 000 1 037 851 500 687 692 764 From property 586 projects -390 -392 -1,684 -1,518 19 0 -360 Other working -500 capital 853 1,051 369 -213 -772 -1 000 -1 274 -1 505 Investing activiti
Slide 28: Corporate net debt Dec 31, 2023
Corporate net debt Dec 31,2023 500 Net debt* / EBITDA ** 0 Target < 2.5x -500 Dec 31, 2023 0.98x *Corporate net debt excluding pension liabilities and leasing liabilities -1 000 -1 500 -1 561 -2 000 -2 374 -2 500 2022 Q4 2023 Q4 28 Jan 30, 2024 NCC AB
Slide 29: Annual General Meeting
Annual General Meeting • April 9, 2024 • At Space conference center in Stockholm • More information will be published no later than four weeks ahead of the AGM • The annual report published at the latest on March 19, 2024 29 Jan 30, 2024 NCC AB AGM 2022, Stockholm, Sweden
Slide 30: Summary
Summary • Increased earnings - EPS target SEK 16 reached • Dividend proposal of SEK 8.00 per share • Strong orders received • Mixed picture with strong parts and more challenging parts • Property market development decisive • Continued significant uncertainty about impact from current economic clima
Slide 31: Slide 31
Slide 32: Contact information
Contact information Tomas Carlsson, CEO tomas.carlsson@ncc.se Susanne Lithander, CFO susanne.lithander@ncc.se Tel +46 730 37 08 74 Maria Grimberg, Head of Communication & IR maria.grimberg@ncc.se Tel +46 708 96 12 88 ncc.com/Investor-relations For definitions and details, please see the quarterly re