Projektengagemang Sweden AB (publ)

Thank you. Good morning everyone and welcome to the presentation of the project engagement result for the second quarter of the year. It was a good quarter in terms of profitability for PE. Our positive result development continues and we are increasing our sales efforts further to take care of the business opportunities that we see ahead. My name is Lislo Taglund and I am the head of the board of directors and the board of directors. I want to start with the market where the uncertainty remains and where the will to invest is still stifled in certain areas, i.e. in line with previous quarters. The housing market is still under pressure and the business linked to commercial properties is still developing weak in the quarter. The predictability around our economy is, however, raising the bar on the market and it is still clear that it will take time before the market turns. Most likely gradually, an improvement from the fall and into 2025. But what we already know is that there is a change in customer needs in energy, defense, industry and the state development that is taking place in terms of the development of infrastructure. The complex challenges that require different types of expertise and experts. Long-term, therefore, the demand for our growing expertise. The prevailing geopolitical uncertainty and the regulatory requirements, for example, need our customers to develop existing buildings and their nearby environments instead of driving and building new. The industry sector is changing to fossil-free, energy needs are increasing and it requires rapid investments in water, wind and solar. Sweden's NATO-interests continue to highlight needs linked to the maintenance of existing infrastructure, new demands on national resistance, civil readiness and resilience. It is within these areas that we see an increased order value and we take more business. We also see a good continued demand and increasing need within the control system, data collection, surveillance and optimization of drives, for example, security facilities, but above all something that is important within buildings and their environment. With that outlook, we are summarizing our quarter for 2024, quarter two, where we continue to deliver a positive result development despite a continued challenging market situation. The EBITDA result increased to 15.7 million kronor compared to 6.4 million the previous year and it is a result of the continued effectiveness measures that we have carried out. The EBITDA marginals improved to .4% against 2.7. In the quarter, all three segments make a better result than the previous year and it depends on the higher cost effectiveness with optimized office space, on the increase in the hour volume, which continues to give a positive effect on the result. Here I think we have good strategy and processes for our award. But it also depends on the degree of debiting, it was somewhat better in the quarter than the previous year. With the measures we have taken, we see continued good potential in this effectiveness forward. The turnover in the quarter decreased to 211 million kronor. The calendar effect in the quarter is 16 hours, which positively affected the turnover with 7.7 million kronor. The effect on EBITDA is not affected in the same way, as we prioritize the salary costs after the month's working hours. All segments show a lower turnover during the quarter and this is mainly due to the adaptation of the staff that we have done in 2023. At the same time, sales have had the highest priority among us and we continue to recruit in areas where we see growth opportunities. Our gas and brake will affect the growth in total during the whole of 2024, but when it comes to gas, we have together recruited an -year-old new employee And then we leave the quarter two, we do that accumulated at about 34 million kronor in results, which corresponds to a margin of about 8%. I also want to mention that the agreement we made with Cortus during the first quarter has not had any effect on the turnover or results during the first half of the year. Only a positive liquidity impact of a smaller character during quarter two. As you know, the third quarter is our weakest quarter due to semester shortages among us and our customers. There is a positive calendar effect during this period, but it does not usually give very big effects due to shortages. I am happy that we now have a greater focus on sales. We recruit on growing markets, we have developed a more effective cost structure with optimized office spaces and we have created a potential for growth, a good reason for us to reach our profitability goal at least 10% of the EBITDA margin. We continue to look at the underlying units and start with architecture and management. Despite the weak will to invest in commercial properties and housing, we continue to see careful enlightenment in architecture, among other things through interior architecture, which is an important signal in the market. The EBITDA result was improved to 5.4 million kronor, which means an EBITDA margin of .5% compared to .6% last year. This is driven by better cost effectiveness, higher degree of activity and good team price increases. Growth has affected as few employees as we have done before. We are now focusing on taking into account the business opportunities. Among other things, there are great needs related to social sustainability and resilience in state development. In the quarter, we have, among other things, gained confidence from IKA properties to carry out climate risk analysis for a number of buildings in their existence. We also contribute with broad expertise in Åstorks kommun, where they build new municipalities and new schools. You can see it on the picture to the right here. There is expertise from everything from architecture and interior design to safety, light design, energy, environment and issues related to roadways, for example. Most of them are PE disciplines. The market for construction and environment has been a challenge during the quarter, especially linked to new construction. As a result, the degree of activity has been somewhat lower. Despite this, the result and margin are higher in the quarter, and it depends on cost effectiveness, but also on the fact that we have managed to keep up and increase our hourly wage. The turnover has decreased, linked to adjustments we have made by the staff, but here we continue to recruit expertise in the areas that we see good demand in, among other things in the issues of conditions. We work a lot with solar parks, for example. Competence in the previous areas and the inventory of natural resources, where we are currently strengthening the customer offer. The EBITDA result improved to 5.9 million kronor and the margin was 7.6 against 4.8 the previous year. In the quarter, we have, among other things, continued to rely on good construction for construction at the implementation of Global Business Gate, and you can see it on this picture. A new innovative NAV on new masonry shelves in Gothenburg, with two builders who will be built on a new peninsula that stretches about two hundred meters out in Götaälv. And finally, installation that happily continues its positive trend and shows for the eighteenth quarter in a row a better result than the previous year. The improvement is linked to the move that has been made in, above all, safety facilities that I mentioned earlier. The result improvement consists primarily of increased labor levels and increased degree of deputation and of course cost efficiency. The EBITDA result was 4.5 million, and the EBITDA margin increased to 6.5 percent against 2.7. The growth here has also been influenced by the personnel adjustments we have made, while we have gassed and recruited in areas that we see have growth opportunities, and that is, among other things, in the construction of the North Sea, to discover protection and safety. In the quarter we have received, among other things, in the order of the North Sea Water and Reef, to modernize Lindholm's waste management work to meet future requirements. That is what we see on the picture. Here we contribute with many competences, among other things, expertise in VVS and electricity, construction, housing automation and VAA. We have also received an order from academic houses that build on Ullmus or from someone familiar with the old student house, where we design electricity systems and hoses. That was a little project example, and we leave the segment and move on to the financial position for the quarter. The period's result per share rose to 0.46 against 0.04. The cash flow from the running activity was 24.6 million kronor. In comparison to the period for the financial activity, there is a distribution per year, which we did not have this year. If you compare the quarter with tax, there is an effect in 2023 where we have received a tax return payment in Q1, which affects the -to-date figure. Net debt EBTA is 2.2 times 2.4. We are moving down to the level of debt. As I said earlier, we are improving our work with our offices, our debt, and we have not yet had a full liquidity effect here, depending on the length of the contract. Net debt, exclusively, IFA is 16. The total net debt was 204, i.e. a total decrease. Finally, and summarized, and important to understand about our quarter 2, our positive result development continues even in quarter 2, despite the market condition continuing to be weak. I am proud that we are performing a good margin, an improved margin, in the quarter 7.4 and accumulated 7.9. It is a result of hard work with cost effectiveness. We have had a good ability to rearrange, made great efforts in sales and handled team price strategies in a good way. All segments deliver a better result than the previous year, and we continue to recruit in areas where we see attractive growth opportunities. We have just now a 60-year announcement out of the components we are looking for, and we will increase sales efforts further forward. Continue to work and focus on sales to improve efficiency, cost control, revenue and price are crucial to profitability and something we will work constantly with. We have a better degree of delivery, but I see a potential forward when it comes to our effectiveness. I would like to thank all the experts at PEE for their very nice efforts during the quarter 2. I am very pleased with what we have achieved together. I would also like to thank our co-workers and our customers. With that, I wish you a happy summer and at the same time open up for any questions.

If you want to ask a question, press the square 5 on your phone to wait for your turn. If you want to ask a question, press the square 6 on your phone to wait for The next question is from Vincent Tegner from CB Equities. Please go

ahead. Thank you. My first question is about how the effectiveness is affected when people are going out and projects are being handed over, which is the debiting rate. How do you see this development during the quarter?

Thank you, Vincent, for that question. I think we have worked well with it. We have good processes for delivery. It is something that increases the effectiveness when you have deliveries, but I think we have worked well. We have found a way to handle that. The improvement we see is also affected by the move we have made in different market areas, where we see an increased demand, for example, in industry, energy and security. So, it is also an effect of

that. Thank you very much. My second question is about the development of the system, which has been going on for a while now, where you are moving towards more growing markets, such as security. I am thinking, for example, of market shares and the

like. Yes, as I said, the joy is that we continue the positive result development. It is clear that we have managed to take a lot of tasks that make us strengthen the order book, we have increased the team price and the debiting rate. This market is linked to defense and security, and also our NATO interests. I see that the potential for the development of the segment of the installation is great. I think we will be able to see the possibility of growing organically here in

the future. Thank you very much. My last question is about how you see yourself completing your career, in addition to strengthening the profitability.

Our main focus this half of the year has been to restore profitability, which has been our highest priority. But our strategic approach and goal are fixed. As soon as possible, we will create profitable growth. Our services are in the right time to meet the demand and we continue to direct. It is the organic growth that is priority right now. In the long run, we will certainly be able to implement the requirements.

Thank you very much. That was all from me.

Thank you, Vincent. The next question comes from Stefan Knutsson from ABG.

Good morning, Liselotte. I was going to look at the conditions to stop... Do you hear me?

Yes, I hear you

well. I was just going to look at the conditions to stop the development we see on the personnel side. It is obvious that you are at a completely new level in profitability, but if I count correctly, you continue to lose 3% of the personnel strength from Q1 to Q2. I was just going to look at that. You mentioned that you have employed 80 people during the first half of the year, but net you are still down to about 70 people, which indicates that we see a very high personnel turnover. I was wondering if you could elaborate on that.

Yes, that is absolutely correct. As we have said earlier, we think that we will have difficulty showing growth during Q4 due to the people that we have had to develope during Q3. We see a slightly higher personnel turnover, but with the experience we have, and I have historically, I don't think it is alarmingly high. However, there is a big demand right now for engineers and architects. It is important to be clear about what we can offer there, and that people should enjoy living well with us. So we want to stay and develop with us. I think that what we have done now, stabilizing, will help us, and our focus for the next half year, Q2, will be to ensure, and our ambition is to ensure, that net and recruitment will be positive.

Thank you. Top. I was just going to check, you mentioned something at the beginning of your presentation about the fact that calendar effects don't strike you down. Is that so? Because it is a bit against how your other sectors do.

That is true. It differs somewhat. We prioritize the salary cost after a month's working hours, so there is no greater effect on the piece when we have a calendar effect, but the turnover is what is affected.

Top. That was all for me.

Thank you very much for your questions and closing comments.

Then we will see, if we have received any written questions. There is a question about the degree of performance which is still a bit below our historical level, and what is the level we should be at. As I said, I see a potential in the effectiveness or the degree of performance in the future. We have shown that we can be at other levels, and the effect of a percent of the rate of performance throughout the year is 11 million crowns, straight into EBITDA. So it is clear that this is a big focus area for us to improve performance and development of it. It is part of our work with effectiveness of processes. So it is a big focus area in the future. We also have a question about our EMPs, which has a somewhat negative trend in the quarter. It is a result of the fact that we have done a lot of work on the move. We have allowed out about 100 people from the company, so it has affected our EMPs. We measure... This shows how to recommend and if you put 9 and 10 as grades, but we also follow other settings regarding how the staff is developing and wants to stay. And those levels are at about the same level as before. Let's see if anything else comes in. No. But then I want to thank you again. I am very pleased with this quarter and with the result development we have had. Thank you very much. I wish you all a happy summer.