Fasadgruppen Group AB (publ)

Good morning everyone. Welcome to the presentation of Fasalgruppen's Q1 results for 2024. With us today here we have our CEO Martin Jakobsson who will present the results and also in the room we have our CFO Kasper Tamm and myself Adrian Westman. With that I hand over to you Martin for the presentation. Thank you Adrian.

So some highlights here for the first quarter of 2024. It's a clear low activity here in the first quarter. It is a typical low season for us. And this is then connected to our services, which is mainly produced on the outdoor of the buildings. And in a cold environment, this affects clearly the activity levels. I would also like to highlight here that new production levels were quite much lower this quarter than compared to last year. Moreover, I would like to highlight here that the competition in Sweden is still tangible, but I would not say that it has worsened compared to the latest couple of quarters here. I'm pleased to see that we've had a healthy organic order backlog growth. And in this environment, I would say that this is a clear positive that the demand is holding up so well for our kind of services and that the customers continue to trust us. In the quarter, we've also completed two acquisitions of Elenta and Alument, which we spoke of in the last conference call. So Moving over to net sales development, we have a clear negative organic development here of 12%. And that is mainly then due to the development in Sweden. I would like to highlight, as I mentioned in the start here, that we've had a low productivity, unfavorable weather conditions, and also an early Easter, which was in March this year compared to April last year. As I mentioned earlier as well, the new production levels is quite clear down, I would say in the portion of some 40% of our new production companies compared to last year. Looking at the EBITDA level, we have a weak margin here of 1.9% compared to 6.5% last year. Also here, the results are affected by the low activity levels. But in honesty, we could say that we are more seasonally affected than we were last year. This combined with a larger overhead in comparison to the project activity makes up for the weaker results but you can look in the chart in the bottom right here you can clearly see the darker blue bars indicating the first quarter of each year so I would still not say that I'm very worried about 24 in that sense the result due to the weak, I would say, seasonality effect here for the first quarter. Looking at the order backlog development, we have a positive organic development of some 4%. And the clear positives here are the markets in Denmark, Norway and Finland, which are all growing. somewhat muted growth here for Sweden. I would say that a positive here is that the order backlog margin is actually somewhat up in the quarter here, indicating at least that we are able to win orders at healthier margins. Moving over to cash flow, I would say that the cash flow follows our typical seasonal pattern. We see an improvement in the working capital of some 7 million compared to a negative of 7 million last year. I would also like to highlight here that the investment levels in CAPEX was some 35 million compared to 10 million in the first quarter of 23. So we are poised for future growth in that instance. That is then connected, of course, to what we see in the activity levels in the market and our positive world backlog developments. Looking at our financial capacity and our net debt, First of all, see that the interest rate here in the first quarter was around 6% compared to 4.6% in the last quarter. We have a very short interest rate period of one to three months. So in the case of a lower interest rate environment, we will adapt quickly. In terms of our net debt to adjusted EBTA, it was on a non-performer level 2.7 and on a performer level 2.6. I would say that I'm not worried about these debt levels. We are eager to continue to acquire companies and to continue our growth journey. Speaking of our growth journey, we are here presenting our two latest acquisitions, which I also mentioned in the last conference call. And what I would like to highlight here is the special setup for Elenta, which we only acquired 60% of the company with an option to acquire the rest, which is a new take, which we've not done before. which is another tool that we're adding to our work belt here in terms of acquisitions going forward. And I would say all in all there's still plenty of M&A opportunities out there. then an update on the energy performance of buildings directive which has been finalized which some of you may may have heard and i would say that this is a clear market trend they're positive for us and all in all i would like to highlight that the building stock by 2050 in the european union will be a zero emission and we are eager to to help our customers in achieving that we also see that there's coming stricter requirements from financing institutions and to take advantage of that we've also initiated a collaboration uh with uh feb the bank in a larger bank hearing in the nordics in order to to take advantage in order helping our customers in the tenant owner associations so that they can achieve both the financing and advice as well as the project execution from us and SEB. With that I would like to highlight here the concluding remarks. I would say that at first glance you could absolutely see a big difference here in the results of the q124 compared to last year then bear with us that the results last year was unusually strong i would say and it is clear that on a where when it's a lower new production level that is hindering us in in achieving greater results in the first quarter so i would say that There's plenty of disadvantages with new production per se, but the clear advantage is that it often is producing during Q1. Often it can be that if you have a deadline where you will move in, let's say in Q1 or Q2, where the customer wants that the building is finalized in this new production stage, then you make that so that you work even during Q1, even if it's cold outside. However, on the renovation side, that is not the case, I would say. Renovation is then more starting up during spring. So in this instance, I would say that our high season compared to low season is then, let's say, from April to December, depending then on weather. I'm also positive here with the order backlog growth indicating future healthy growth and also then that the margin in the backlog is stable to positive. So with that said, I would say that we are still positioned to capitalize on our long-term market drivers and eager to assist our customers in helping them. And with that said, I'd also like to highlight that we have a capital markets day here on the 2nd of September, 1 p.m. in Stockholm. So I hope to see you all at that stage. And with that, we open up for questions.

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