FULLTEXT DEL 1 AV 1
Kvartalsrapport Q3 2024
===== SIDA 1 =====
Interim Report Q3
JANUARY – SEPTEMBER 2024
More than doubled order intake
Third quarter: July - September
• Net sales increased by 31 percent to 331 MSEK (253)
• Order intake increased by 111 percent to 285 MSEK (135)
• Order backlog increased by 25 percent to 1,329 MSEK
(1,067)
• Adjusted operating profit (EBITA) amounted to 17 MSEK
(15)
• Adjusted operating margin amounted to 5.0 percent
(6.0)
• Net profit after tax amounted to 1 MSEK (6)
• Earnings per share amounted to -0.03 SEK (0.24)
• Operating cash flow amounted to -1 MSEK (18)
The interim period: January– September
• Net sales increased by 11 percent to 1,031 MSEK
(925)
• Order intake increased by 49 percent to 1,017 MSEK
(682)
• Adjusted operating profit (EBITA) amounted to 52
MSEK (74)
• Adjusted operating margin amounted to 5.0 percent
(8.0)
• Net profit after tax amounted to 7 MSEK (40)
• Earnings per share amounted to 0.12 SEK (1.81)
• Operating cash flow improved to 81 MSEK (-2)
Events during the quarter and since the end of the quarter
• Structural change of Riikku's operations and company structure.
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Order intake 285,5 135,1 1 017,2 681,7 1 312,5 977,0
Order backlog 1 328,8 1 066,9 1 328,8 1 066,9 1 328,8 1 073,6
Adjusted operating profif (EBITA) 16,6 15,2 51,5 74,5 66,9 89,8
Adjusted operating margin (EBITA), % 5,0 6,0 5,0 8,0 5,1 7,4
Net profit for the period 0,9 5,6 6,7 39,9 13,3 46,5
Operating cash flow -1,4 18,4 80,8 -2,0 86,4 3,6
Earnings per share, SEK before dilution -0,03 0,24 0,12 1,81 0,40 2,09
Earnings per share, SEK, after dilution -0,03 0,24 0,12 1,81 0,40 2,09
" During the quarter, Balco AB received a major turnkey project in Borås in Sweden of approximately 60 MSEK. "
" Our newly acquired Finnish company Suomen ohutlevyasennus Oy has been selected as a supplier for several
major projects during the quarter and so far in October in total of 8 MEUR. “
- Camilla Ekdahl, President and CEO
===== SIDA 2 =====
2 | Balco Group Interim Report 1 January - 30 September 2024
Strong increase in order intake
Both order intake and sales increased during the quarter
compared to the same period last year. Order intake in-
creased sharply by 111 percent, of which 49 percent was
organic. Net sales increased by 31 percent, with the entire
increase in net sales coming from acquisitions.
Profit and net sales are still affected by the weaker order
intake last year, but profitability remains stable with an
adjusted EBITA margin of 5 percent. This is not a level we
are satisfied with in the longer term but given the slow-
down the market experienced when interest rates and in-
flation increased, we still have stability in our profitability,
albeit at a level that is too low compared to our target.
The market situation
Both the willingness and ability to start renovation pro-
jects have increased due to the continued lowering of in-
terest rates and inflation that has decreased. Customer
activity has continued to increase, but the trend of longer
process times for decisions remains and some of our
companies are exposed to greater price pressure. This ap-
plies above all to the facade companies in Sweden and
our balcony company in Denmark.
The need for renovation is great both for balconies and
facades and continues to be a fundamental driving force
for all our companies. The need is reinforced with the new
EU directive on energy performance for buildings. Balco
Group will be able to play an important role in future ren-
ovation projects by offering balcony glazing that can pro-
vide energy savings of up to 30 percent. In addition, we
offer turnkey projects with other energy-saving measures
such as facade renovations, window replacements, roof
insulation, installation of solar panels and air -to-air heat
pumps.
More new turnkey projects
Our newly acquired Finnish company Suomen
ohutlevyasennus Oy has been selected as a supplier for
several major projects during the quarter and so far in Oc-
tober. The total order value is approximately 8 MEUR, of
which 1.9 MEUR is included in the order intake for the third
quarter. The contracts involve a turnkey renovation of the
façade, windows, doors and balconies for three tenant -
owner associations with a total of nine apartment build-
ings. The balconies will be supplied by our other Finnish
company Riikku. The projects will start up at the end of
the year.
During the quarter, Balco AB received a major turnkey
project in Borås of approximately 60 MSEK which, in ad-
dition to glazed balconies, includes facade work, drainage
and upgrading of green areas. Here we have had a long-
standing dialogue with the customer, where we have con-
tinuously supported with financial expertise in the discus-
sions both within the housing association and with banks
and consultants.
New innovative solution
Balco continues to prove to be the leading developer in
the balcony area with solutions that can provide energy
savings for the residents. A patent has been applied for
further development of our solution with air -to-air heat
pumps. Balco's offer to supply glazed balconies where the
air-to-air heat pumps are part of the overall offering con-
tinues to attract great interest in the Norwegian market.
Structural changes
We are constantly working on optimizing our processes
and our organization. To achieve the best development
from our newly acquired Finnish group Riikku, we have
therefore taken a decision to restructure their operations
and company structure. This means, among other things,
that Riikku will create a n additional business area of its
own in its Finnish operations with focus on renovation,
while at the same time the Swedish operations for new
build will be transferred to RK Teknik.
Prospects
We are noticing an increase in activity from a low level
for our balcony companies that work with renovation.
The entire Group has a strong focus on order intake, but
we will be cautious about entering into price-pressured
projects. Net sales and profit will continue to be affected
in the coming quarters, due to a lower order intake in
the past year, as well as the lead time from order intake
until the projects can start up and generate turnover. All
companies in the Group have a strong focus on costs,
while at the same time we work to create good long-
term profitability. This means that the coming quarters
will also have some overcapacity for certain resources in
the Group.
Camilla Ekdahl
President and CEO
===== SIDA 3 =====
3 | Balco Group Interim Report 1 January - 30 September 2024
Group development
Third quarter: July – September
Net sales increased by 31 percent to 331 MSEK (253). Acquired growth was 43 percent,
currency effect was -4 percent, and organic growth was -8 percent. Net sales for the
renovation segment amounted to 247 MSEK (225) and net sales for the new b uild
segment amounted to 84 MSEK (28).
Order intake increased by 111 percent to 285 MSEK (135). Acquired order intake was
62 percent and organically order intake increased by 49 percent. The renovation seg-
ment accounted for 250 MSEK (82) and the new build segment accounted for 35 MSEK
(53).
The order backlog increased by 25 percent to 1,329 MSEK (1,067). The order backlog
for the renovation segment amounted to 1,034 MSEK (899) and the order backlog for
the new build segment increased to 295 MSEK (168).
Gross profit amounted to 54 MSEK (53), corresponding to a gross margin of 16.2 per-
cent (21.1). Gross profit includes items affecting comparability of 2 MSEK (0) related to
restructuring costs. Adjusted gross profit was 56 MSEK (53) and adjusted gross margin
was 17.0 percent (21.1). The gross margin has decreased due to a different cost struc-
ture in the acquired companies with a lower gross margin than the Group average. In
addition, the gross margin is affected by low occupancy in the G roup's production
facilities and in the project organization.
Sales costs amounted to 25 MSEK (25) and administrative costs amounted to 20 MSEK
(17). The increase comes from the acquired companies. Items affecting comparability
of -2 MSEK (-1) were taken in the quarter related to acquisition costs and restructuring
of the organization.
Adjusted operating profit (EBITA) amounted to 16 MSEK (15), corresponding to an ad-
justed operating margin of 5.0 percent (6,0).
Net financial items amounted to -9 MSEK (-5), of which -0.3 MSEK (-0.3) relates to
interest expenses linked to rights of use (leases) and -1 MSEK (0)
relates to unrealized
currency losses. Interest expenses of -6 MSEK (-5) have increased due to increased
borrowing in connection with completed acquisitions.
Profit after tax amounted to 1 MSEK (6). Earnings per share amounted to -0.03 SEK
(0.24).
Operating cash flow amounted to -1 MSEK (18). The timing of building permits and the
phases of the projects affect the cash flow between quarters.
Order intake per segment, MSEK
Order backlog, MSEK
100
200
300
400
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2022 2023 2024
New Build Renovation
200
400
600
800
1 000
1 200
1 400
1 600
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2022 2023 2024
Order intake
Q3 2024
285 MSEK
===== SIDA 4 =====
4 | Balco Group Interim Report 1 January - 30 September 2024
Interim period: January – September
Net sales increased by 11 percent to 1,031 MSEK (925). Acquired growth was 34 percent,
currency effect was -1 percent, and organic growth was -22 percent. Net sales for the
renovation segment amounted to 719 MSEK (846) and net sales for the new build seg-
ment amounted to 312 MSEK (79).
Order intake increased by 49 percent to 1,017 MSEK (682). Acquired order intake was
45 percent and organic order intake increased by 4 percent. The renovation segment
accounted for 789 MSEK (570) and the new build segment accounted for 228 MSEK
(112).
Gross profit amounted to 190 MSEK (195), corresponding to a gross margin of 18.4
percent (21.1). The gross result includes items affecting comparability of - 6 MSEK (-4)
related to restructuring costs. Adjusted gross profit was 196 MSEK (199) and adjusted
gross margin 19.0 percent (21.5). The gross margin has decreased due to a different
cost structure in the acquired companies with a lower gross margin than the G roup
average. In addition, the gross margin is affected by low occupancy in the G roup's
production facilities and in the project organization.
Sales costs amounted to 90 MSEK (82) and administrative costs amounted to 72 MSEK
(54). The increase comes from the acquired companies. Items affecting the compara-
bility of -8 MSEK (-3) have been taken so far this year linked to acquisition costs and
restructuring of the organization.
Adjusted operating profit (EBITA) amounted to 52 MSEK (74), corresponding to an
adjusted operating margin of 5.0 percent (8,0).
Net financial items amounted to - 21 MSEK (-10), of which - 1.1 MSEK (-1.2) relates to
interest expenses linked to rights of use (leases) and -1 MSEK (0) relates to unrealized
currency losses. Interest expenses of -17 MSEK (-10) have increased, due to increased
borrowing in connection with completed acquisitions.
Profit after tax amounted to 7 MSEK (40), while comprehensive income for the period
amounted to 9 MSEK (43) after positive currency translation differences. Earnings per
share amounted to 0.12 SEK (1.81).
Operating cash flow improved to 81 MSEK (-2). The timing of building permits and the
phases of the projects affect the cash flow between quarters.
Net sales per customer category, MSEK
Net sales per geographic market, MSEK
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
2024 2023 2024 2023 2023/24 2023
Tenant-owner associations 180,6 130,5 528,8 599,7 719,4 790,3
Private landlords 20,1 30,1 67,1 79,2 106,4 118,5
Publicly owned companies 14,4 9,1 38,6 40,3 48,9 50,5
Construction companies 116,0 83,6 397,0 206,2 446,3 255,6
Total net sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
2024 2023 2024 2023 2023/24 2023
Sweden 137,8 148,3 439,8 585,8 606,6 752,6
Other Nordics 165,2 63,7 489,9 228,1 571,7 310,0
Other Europe 28,1 41,2 101,8 111,5 142,7 152,3
Total net sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Net sales, MSEK
Adjusted operating profit, MSEK
0
300
600
900
1 200
1 500
100
200
300
400
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2022 2023 2024
0
25
50
75
100
125
10
20
30
40
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2022 2023 2024
Operating cash flow
YTD
81MSEK
Net sales
R12
Adjusted operating profit
R12
===== SIDA 5 =====
5 | Balco Group Interim Report 1 January - 30 September 2024
Development per segment
Renovation
Third quarter
Net sales increased by 10 percent to 247 MSEK (225), corresponding to 75 percent (89) of total net sales.
Order intake increased by 205 percent to 250 MSEK (82), corresponding to 88 percent (61) of total order intake.
The adjusted operating profit (EBITA) amounted to 15 MSEK (16), corresponding to an adjusted operating margin of 6.0 percent
(7.1).
Interim period
Net sales amounted to 719 MSEK (846), corresponding to 70 percent (91) of total net sales.
Order intake increased by 39 percent to 789 MSEK (570), corresponding to 78 percent (84) of total order intake.
The adjusted operating profit (EBITA) amounted to 36 MSEK (72), corresponding to an adjusted operating margin of 5.0 percent
(8.5).
The order backlog increased by 15 percent to 1,034 (899), corresponding to 78 percent (84) of the total order backlog.
New build
Third quarter
Net sales increased by 198 percent to 84 MSEK (28), corresponding to 25 percent (11) of total net sales.
Order intake amounted to 35 MSEK (53), corresponding to 12 percent (39) of total order intake.
The adjusted operating profit (EBITA) amounted to 3 MSEK (1), corresponding to an adjusted operating margin of 3.8 percent (5.1).
Interim period
Net sales increased by 295 percent to 312 MSEK (79), corresponding to 30 percent (9) of total net sales.
Order intake increased by 103 percent to 228 MSEK (112), corresponding to 22 percent (16) of total order intake.
The adjusted operating profit (EBITA) improved to 16 MSEK (3), corresponding to an adjusted operating margin of 5.0 percent
(4.0).
The order backlog increased by 75 percent to 294 MSEK (168), corresponding to 22 percent (16) of the total order backlog.
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
Renovation, MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 246,6 225,0 719,5 846,3 961,2 1 088,0
Adjusted operating profit (EBITA) 14,8 15,9 36,2 71,9 48,0 83,8
Adhusted operating margin (EBITA), % 6,0 7,1 5,0 8,5 5,0 7,7
Order intake 250,0 82,0 789,1 569,6 1 058,2 838,7
Order backlog 1 034,4 898,7 1 034,4 898,7 1 034,4 925,5
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
New Build, MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 84,4 28,3 312,0 79,1 359,8 126,9
Adjusted operating profit (EBITA) 3,2 1,5 15,6 3,1 17,2 4,8
Adhusted operating margin (EBITA), % 3,8 5,1 5,0 4,0 4,8 3,8
Order intake 35,4 53,0 228,1 112,1 254,3 138,3
Order backlog 294,4 168,2 294,4 168,2 294,4 148,1
===== SIDA 6 =====
6 | Balco Group Interim Report 1 January - 30 September 2024
Financial position and cash flow
Liquidity and financial position
Interest-bearing net debt including lease liabilities at the end of interim period
amounted to 359 MSEK (223). Pro forma, including 12 months of earnings from ac-
quired companies, i nterest-bearing net debt including lease liabilities in relation to
adjusted EBITDA was 2.9 times (1.4).
Interest-bearing net debt excluding lease liabilities amounted to 298 MSEK (153). Pro
forma, including 12 months of earnings from acquired companies, interest-bearing net
debt excluding lease liabilities in relation to adjusted EBITDA was 2.8 times (1.1).
At the end of the interim period, the Group’s equity amounted to 797 MSEK (758).
The Group’s equity/assets ratio was 49 percent (56).
Cash flow, investments and amortization/depreciation
For the interim period, cash flow from operating activities amounted to 32 MSEK
(-44).
Cash flow from investing activities amounted to - 87 MSEK (-50), of which - 1 MSEK
(-2) was replacement investments and - 5 MSEK ( -9) expansion investments and
-81 MSEK (-39) acquisition of shares in subsidiaries.
Cash flow from financing activities amounted to 93 MSEK (62) with the largest item
relating to increased utilization of the revolving credit facility.
Cash flow for the interim period amounted to 38 MSEK (-31).
Depreciation for the interim period amounted to -39 MSEK (-33), of which -14 MSEK
(-15) relates to depreciation related to rights of use (lease) and -7 MSEK (-5) relates to
amortization of acquired intangible assets.
Parent company
The Parent Company is headquartered in Växjö and conducts business directly and
through Swedish and foreign subsidiaries. The activities of the Parent Company are
mainly focused on strategic development, financial management, corporate govern-
ance issues, board work and banking relations.
30-sep 30-sep 31-dec
MSEK 2024 2023 2023
Non-current liabilities to credit institutions 337,0 174,7 174,2
Leasing liabilities non-current 48,1 54,3 51,2
Current liabilities to credit institutions - 0,4 -
Leasing liabilities current 13,1 14,8 19,0
Cash and cash equivalents -39,4 -21,6 -2,8
Interest-bearing net debt incl leasing debt 358,8 222,6 241,6
Interest-bearing net debt excl leasing debt 297,6 153,5 171,4
Interest-bearing net debt incl. leasing/EBITDA (12 months),
times
3,3 x 1,5 x 1,9 x
Interest-bearing net debt incl. leasing/EBITDA (proforma)
(12 months), times
2,9 x 1,4 x 1,9 x
Interest-bearing net debt excl. leasing/EBITDA (12 months),
times
3,3 x 1,2 x 1,6 x
Interest-bearing net debt excl. leasing/EBITDA (proforma)
(12 months), times
2,8 x 1,1 x 1,6 x
Equity/assets ratio, % 48,9 57,5 58,9
External interest-bearing net debt
In relation to EBITDA (proforma)
Operating cash flow R12, MSEK
0,0
0,5
1,0
1,5
2,0
2,5
3,0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2022 2023 2024
50
100
150
200
250
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Equity7assets ratio
49 %
===== SIDA 7 =====
7 | Balco Group Interim Report 1 January - 30 September 2024
Operations and segment description
Balco Group is a market leader in the balcony industry and offers a range of services, from development and manufacturing to
sales and installation of in-house manufactured open and glazed balcony systems. Balco has a unique method, known as the
Balco method, to deliver glazed balconies and balcony solutions. The method involves removing existing balconies and replac-
ing them with new, larger, glazed balconies with a lifespan of over 90 years, which provides the market's most economical and
sustainable solution.
To offer complete and customized solutions in the balcony industry, Balco Group has several subsidiaries that work together to
offer a complete solution in areas such as the manufacture and delivery of balconies, masonry and tile services, technical solutions
and façade services such as renovation, window replacement and façade cleaning. Balco Group strives to meet the customer's
needs and requirements by offering a combination of specialized services and expertise. Balco Group's offering contributes to
increased quality of life, security and value increase for residents in apartment buildings and provides energy savings of up to 30
percent. The Group takes full responsibility for the project and guides the customer through the entire process from project
planning to final inspection and service.
Segment - Renovation Segment - New Build
Sjøsiden Boligpark, Norway New Road Rainham, UK
The segment includes the replacement and expansion of exist-
ing balconies, mainly glazed balconies. The main driving force
is the pent -up need for renovation and the age profile of the
properties. The offer also includes façade renovation.
The segment includes balconies in the construction of multi -
dwelling properties. Demand is driven by the pace of new
housing production. The offer also includes façade work in
new construction.
Sales development per quarter, MSEK Operating margin per quarter, %
Sustainability
Sustainability is a prerequisite for long-term profitability for Balco Group. By focusing on sustainability, we can create a
strong brand, increase customer trust, and improve our competitiveness in the long term. We will continue to work hard to
incorporate sustainability into all aspects of our business.
Sustainability is a focus area in the construction industry and affects all parts of the value chain. This is especially true of the
market for balconies where Balco Group operates. Property developers and property owners are demanding economically
advantageous and climate-smart solutions with a long lifespan.
As an important step in our sustainability work and goal to be a leader in the climate transition in its industry, Balco Group
has committed to developing short-term and long-term emission reduction targets including net zero targets in line with the
Science Based Targets initiative (SBTi).
100
200
300
400
2023
2024
2023
2024
2023
2024
2023
2024
Q1 Q2 Q3 Q4
New Build Renovation
2,0
4,0
6,0
8,0
10,0
2023
2024
2023
2024
2023
2024
2023
2024
Q1 Q2 Q3 Q4
New Build Renovation
===== SIDA 8 =====
8 | Balco Group Interim Report 1 January - 30 September 2024
Other information
Employees
The number of full-time employees in Balco Group amounted to 631 (501) as of the end of September 2024. The increase comes from the
acquired companies Riikku Group Oy and Suomen ohutlevyasennus Oy.
Seasonality
Balco's sales and earnings are partly affected by the timing of orders, seasonal variations and the fact that the general meeting season in
tenant-owner associations normally falls in the second and fourth quarters. Furthermore, the Group is positively affected by months with
many working days and lack of time off, as well as negatively by weather factors where winters with significant snowfall mean increased
costs.
Shares, share capital and shareholders
As of the end of September 2024, the number of shares in Balco Group AB amounted to 23,021,648 shares, corresponding to a share
capital of 138,135,310 SEK. The number of shareholders was 5,025. The five largest shareholders were Familjen Hamrin, Skandrenting AB,
Lannebo Kapitalförvaltning, Swedbank Robur fonder and AB Tuna Holding.
Related party transactions
The related parties consist of the Board of Directors, Group Management and the CEO, partly through ownership in Balco and partly
through the role of senior executive. The related parties also include the company's largest shareholders, the Hamrin family, which is
represented on the board by Carl-Mikael Lindholm, and Skandrenting, which is represented on the board by Johannes Nyberg. Transac-
tions with related parties are carried out on a market basis. For further information, see the Annual Report 2023 on pages 79 and 99.
Incentive program
Balco Group AB has two long-term incentive programs aimed at the company's senior executives and additional key employees, a total
of approximately 40 employees. The incentive programs comprise a maximum of 450,000 warrants in total, which entitle the hold er to
subscribe for a maximum of the corresponding number of shares. Balco's total cost for the incentive programs during the term of the
programs is expected to amount to approximately 3 MSEK. The programs entail a dilution corresponding to approximately 2 percent of
the company's total number of shares. The senior executives of Balco have acquired 120,000 warrants amounting to a total valu e of
549,800 SEK. The purpose of the incentive programs is to encourage broad shareholding among Balco's employees, facilitate recruitment,
retain competent employees and increase the motivation to achieve or exceed the company's financial targets. For more information, see
the Annual Report 2023 on pages 76, 78 and 113.
Risks and uncertainty factors
The Group and the Parent Company are exposed to various types of risks through their operations. The risks can be divided into industry-
and market-related risks, business-related risks and financial risks. Industry- and market-related risks include, among other things, changes
in demand because of a weaker economy or other macroeconomic changes, a changed price picture for raw materials that are central to
Balco's production, and changes in competition or price pressure. Business -related risks include Balc o's ability to develop and sell new
innovative products and solutions, that the Group can attract and retain qualified employees, and that Balco's profitability is dependent
on the results of the individual projects, i.e. the Group's ability to predict, calculate and deliver the projects within set financial frameworks.
The financial risks are summari zed under financing risk, liquidity risk, credit risk and interest rate risk. Balco's risks and uncertainties are
described on pages 30–35, 42, 87–88, 91 and 94 of the Annual Report for 2023.
Outlook
Balco Group is one of the few complete balcony suppliers on the market that provides customized and innovative balcony solutions on a
turnkey contract. Balco Group is the market leader in the Nordic region and has a challenging position in other markets where the Group
operates. The market is fragmented and growing throughout Northern Europe. The value of the balcony market in the countries w here
Balco Group is represented is estimated at just over 40 billion SEK.
Balco Group continuously evaluates selective acquisitions that can strengthen our market position in existing markets. The ti ming of
building permits affects cash flow between quarters. The lower order intake over the past year will affect sales and earnings in the coming
quarters. We continue to focus on costs and adjust the organization based on changes in occupancy and order intake but retain important
expertise so that the company is not damaged in the long term.
===== SIDA 9 =====
9 | Balco Group Interim Report 1 January - 30 September 2024
Financial targets
Revenue growth
Balco shall achieve growth of 10 percent per year during a business cycle.
Profitability
Earnings per share shall grow by 20 percent per year during a business cycle.
Capital structure
Interest-bearing net debt shall not exceed 2.5 times operating profit before depreciation and amortization (EBITDA), other than
temporarily.
Dividend policy
Balco shall distribute 30 -50 percent of profit after tax, taking into consideration the needs for Balco’s long -term growth and
prevailing market conditions
The interim report has been subject to a review of ISRE 2410 by the company's auditors.
This information comprises such information as Balco Group AB is obliged to publish in accordance with the EU Market Abuse Regulation. The
information was provided by the contact person below for publication on October 28, 2024, at 13:00 CET.
Camilla Ekdahl
President and CEO
Web conference
A webcast conference call will be held at 14:0 0 CET October 28, 2024, where CEO and President Camilla
Ekdahl and CFO Michael Grindborn will present the report and answer questions.
To follow the webcast presentation and send written questions, please use this link:
https://www.finwire.tv/webcast/balcogroup/q3-2024/
To participate via teleconference and be able to ask questions, call in:
SE: +46 8 5052 0017
PIN: 835 5857 5016 #
For more information, please contact:
Camilla Ekdahl, President and CEO, Tel: +46 70 606 30 32, camilla.ekdahl@balco.se
Michael Grindborn, CFO and Head of IR, Tel: +46 70 670 18 48, michael.grindborn@balco.se
Calendar 2024
Year-end report Jan-Dec 2024 ........ February 10, 2025
Annual Report 2024 ............................ March 14, 2025
Interim report Jan-Mar 2025 ............ April 28, 2025
Annual General Meeting 2025 ......... May 6, 2025
Interim report Jan-Jun 2025 ............. July 14, 2025
Interim report Jan-Sep 2025 ............. October 27, 2025
===== SIDA 10 =====
10 | Balco Group Interim Report 1 January - 30 September 2024
Consolidated statement of comprehensive income
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Production and project costs -277,5 -199,9 -841,6 -730,5 -1 080,7 -969,5
Gross profit 53,6 53,4 189,8 194,9 240,3 245,4
Sales costs -25,5 -25,3 -89,7 -81,5 -116,5 -108,4
Administration costs -19,8 -17,2 -72,4 -54,3 -94,8 -76,7
Other operating income 1,2 1,4 2,2 3,5 9,0 10,3
Other operating expenses -0,0 -0,1 -0,0 -0,2 -0,1 -0,2
Operating profit 9,5 12,3 29,9 62,3 38,0 70,4
Finance income 0,4 0,9 2,7 2,7 3,7 3,7
Finance costs -9,2 -5,8 -23,8 -12,7 -29,2 -18,1
Profit before tax 0,8 7,3 8,8 52,4 12,5 56,0
Income tax 0,2 -1,7 -2,1 -12,4 0,8 -9,5
Net profit for the period 0,9 5,6 6,7 39,9 13,3 46,5
Net result attributable to parent company's shareholders -0,7 5,3 2,7 39,7 8,9 45,9
Net result attributable to non-controlling interest 1,6 0,3 4,0 0,2 4,4 0,6
Net profit for the period 0,9 5,6 6,7 39,9 13,3 46,5
Other comprehensive income
Items that may later be reclassified to the income
statement
Translation difference when translating foreign
operations -1,5 -4,5 1,9 3,4 1,9 3,4
Comprehensive income for the period -0,5 1,1 8,7 43,4 15,2 49,9
Comprehensive income attributable to parent company's
shareholders -2,2 0,8 4,7 43,2 10,8 49,2
Comprehensive income attributable to non-controlling
interest 1,6 0,3 4,0 0,2 4,4 0,6
Comprehensive income for the period -0,5 1,1 8,7 43,4 15,2 49,9
Earnings per share, SEK, before dilution -0,03 0,24 0,12 1,81 0,40 2,09
Earnings per share, SEK, after dilution -0,03 0,24 0,12 1,81 0,40 2,09
Average number of shares before dilution, thousands 23 022 21 909 22 936 21 909 22 680 21 909
Average number of shares after dilution, thousands 23 022 21 909 22 936 21 909 22 680 21 909
===== SIDA 11 =====
11 | Balco Group Interim Report 1 January - 30 September 2024
Consolidated balance sheet in summary
30-sep 30-sep 31-dec
MSEK 2024 2023 2023
ASSETS
Non-current assets
Intangible assets
Goodwill 515,0 485,4 485,2
Other intangible assets 276,6 142,2 142,2
Total intangible assets 791,6 627,6 627,3
Tangible assets
Right-to-use assets 59,0 67,8 70,5
Property, plant and equipment 224,6 162,9 161,9
Total tangible assets 283,6 230,6 232,4
Financial assets 3,6 - -
Deferred tax assets 0,8 0,7 0,3
Total non-current assets 1 079,6 858,9 860,1
Current assets
Inventory 70,7 58,6 51,5
Accounts receivables 179,8 158,6 138,0
Contract assets 207,3 156,2 177,1
Other current receivables 51,5 62,7 37,7
Cash and cash equivalents 39,4 21,6 2,8
Total current assets 548,6 457,8 407,2
TOTAL ASSETS 1 628,2 1 316,7 1 267,2
EQUITY AND LIABILITIES
Equity
Share capital 138,1 131,5 131,5
Other capital contributions 450,8 406,3 406,3
Reserves 13,6 11,7 11,6
Retained earnings, incl. profit for year 191,5 207,0 196,7
Equity attributable to Parent Company’s shareholders 794,0 756,5 746,1
Non-controlling interest 4,6 1,4 1,8
TOTAL EQUITY 798,6 757,9 748,0
LIABILITIES
Non-current liabilities
Liabilities to credit institutions 337,0 174,7 174,2
Leasing liabilities 48,1 54,3 51,2
Other non-current liabilities 36,6 13,8 1,4
Deferred tax liabilities 69,5 42,1 41,7
Total non-current liabilities 491,2 284,9 268,5
Current liabilities
Liabilities to credit institutions - 0,4 -
Leasing liabilities 13,1 14,8 19,0
Contract liabilities 61,0 70,3 50,0
Accounts payables 147,1 101,7 91,0
Other current liabilities 117,1 86,7 90,7
Total current liabilities 338,3 273,9 250,7
TOTAL EQUITY AND LIABILITIES 1 628,2 1 316,7 1 267,2
===== SIDA 12 =====
12 | Balco Group Interim Report 1 January - 30 September 2024
Consolidated changes in Shareholders’ Equity
MSEK
Share
Capital
Addition
al paid-in
capital Reserves
Retained
earnings
including
comprehensive
Non-
controlling
interest
Total
equity
Opening balance 1 Jan 2023 131,5 406,3 8,3 183,7 1,2 731,0
Comprehensive income for the period
Profit for the period - - - 39,7 0,2 39,9
Other comprehensive income for the period - - 3,4 - - 3,4
Total comprehensive income for the period - - 3,4 39,7 0,2 43,3
Transactions with shareholders:
Distributed dividend - - - -16,4 - -16,4
Total transactions with Company owners - - - -16,4 - -16,4
Closing balance 30 Sep 2023 131,5 406,3 11,7 207,0 1,4 757,9
Opening balance 1 Jan 2024 131,5 406,3 11,6 196,7 1,8 748,0
Comprehensive income for the period
Profit for the period - - - 2,7 4,0 6,7
Other comprehensive income for the period - - 1,9 - - 1,9
Total comprehensive income for the period - - 1,9 2,7 4,0 8,7
Transactions/ acquisitions/ disposald in holdings without
control - - - -7,9 -1,2 -9,1
Transactions with shareholders:
New shares issue 6,7 43,5 - - - 50,2
New warrants issue - 0,9 - - - 0,9
Total transactions with Company owners 6,7 44,5 - - - 51,1
Closing balance 30 Sep 2024 138,1 450,8 13,6 191,5 4,6 798,6
===== SIDA 13 =====
13 | Balco Group Interim Report 1 January - 30 September 2024
Consolidated Cash Flow Statements in summary
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Operating activities
Operating profit (EBIT) 9,5 12,3 29,9 62,3 38,0 70,4
Adjustment for non-cash items 12,5 8,9 22,9 34,0 27,9 38,9
Interest received 0,7 0,9 2,5 2,7 3,5 3,7
Interest paid -7,5 -5,5 -20,4 -11,5 -25,5 -16,5
Income tax paid -5,7 -7,4 -14,3 -32,4 12,4 -5,8
Cash flow from operating activities before changes in
working capital 9,5 9,2 20,6 55,1 56,2 90,7
Changes in working capital
Increase (-)/Decrease (+) in inventories -0,0 0,8 -2,0 0,2 5,2 7,4
Increase (-)/Decrease (+) in current assets 22,2 10,0 18,5 7,5 15,3 4,3
Increase (+)/Decrease (-) in current liabilities -51,5 -14,0 -5,2 -106,4 -27,3 -128,5
Cash flow from operating activities -19,8 5,9 31,9 -43,6 49,3 -26,1
Cash flow from investing activities
Investments in intangible fixed assets -1,5 -0,5 -2,5 -3,5 -4,6 -5,6
Investments in tangible fixed assets -0,5 -1,4 -2,9 -6,8 -3,8 -7,7
Acquisitions of operations 0,3 - -80,8 -39,5 -80,8 -39,5
Changes in other non-current assets/liabilities -0,4 - -0,8 - -0,8 -
Cash flow from investing activities -2,0 -1,9 -87,0 -49,8 -90,0 -52,9
Cash flow from financing activities
Changes in bank loans -14,2 -5,0 108,3 94,4 99,7 85,8
Changes in leasing -4,9 -4,0 -15,1 -15,7 -22,8 -23,4
New warrants issue 0,9 - 0,9 0,0 0,9 0,0
Distributed dividend to non-controlling interest -1,2 - -1,2 - -1,2 -
Distributed dividend to parent company's shareholders - - - -16,4 -16,4 -32,9
Cash flow from financing activities -19,3 -9,0 92,9 62,3 60,2 29,6
Cash flow for the period -41,2 -5,0 37,8 -31,1 19,5 -49,4
Cash and cash equivalents at beginning of the period 81,2 27,5 2,8 51,9 21,6 51,9
Exchange rate differential cash and cash equivalents -0,7 -0,9 -1,2 0,8 -1,7 0,4
Cash and cash equivalents at end of the period 39,4 21,6 39,4 21,6 39,4 2,8
===== SIDA 14 =====
14 | Balco Group Interim Report 1 January - 30 September 2024
Key ratios
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Order intake 285,5 135,1 1 017,2 681,7 1 312,5 977,0
Order backlog 1 328,8 1 066,9 1 328,8 1 066,9 1 328,8 1 073,6
Gross profit 53,6 53,4 189,8 194,9 240,3 245,4
Adjusted Gross Profit 56,2 53,4 195,8 198,7 249,9 252,9
EBITDA 22,4 22,3 69,4 95,7 88,4 114,7
Adjusted EBITDA 27,4 23,5 83,6 102,8 108,2 127,4
Operating profit (EBITA) 11,6 13,9 37,3 67,4 47,0 77,1
Adjusted operating profit (EBITA) 16,6 15,2 51,5 74,5 66,9 89,8
Operating profit (EBIT) 9,5 12,3 29,9 62,3 38,0 70,4
Adjusted operating profit (EBIT) 14,5 13,5 44,2 69,4 57,9 83,0
Gross profit margin, % 16,2 21,1 18,4 21,1 18,2 20,2
Adjusted gross margin, % 17,0 21,1 19,0 21,5 18,9 20,8
EBITDA margin, % 6,8 8,8 6,7 10,3 6,7 9,4
Adjusted EBITDA margin, % 8,3 9,3 8,1 11,1 8,2 10,5
Operating profit margin (EBITA), % 3,5 5,5 3,6 7,3 3,6 7,9
Adjusted operating profit margin (EBITA), % 5,0 6,0 5,0 8,0 5,0 8,4
Operating profit margin (EBIT), % 2,9 4,8 2,9 6,7 2,9 5,8
Adjusted operating profit margin (EBIT), % 4,4 5,3 4,3 7,5 4,4 6,8
Operating cash flow -1,4 18,4 80,8 -2,0 86,4 3,6
Operating cash conversion, % -5,1 78,2 96,6 -2,0 79,8 2,8
Capital employed, average 1 144,0 978,9 1 070,3 906,9 1 066,0 911,2
Capital employed, excl. goodwill, average 629,7 493,4 570,2 435,2 565,8 439,7
Equity, average 793,7 756,1 770,1 743,2 775,3 738,0
Interest-bearing net debt incl leasing debt 358,8 222,6 358,8 222,6 358,8 241,6
Interest-bearing net debt excl leasing debt 297,6 153,5 297,6 153,5 297,6 171,4
Interest-bearing net debt incl. leasing/Adjusted EBITDA 12
months, times 3,3 1,5 3,3 1,5 3,3 1,9
Interest-bearing net debt excl. leasing/EBITDA (12 months),
times 3,3 1,2 3,3 1,2 3,3 1,6
Return on capital employed, %, (12 months) 5,1 10,5 5,4 11,3 5,4 9,1
Return on capital employed, excl. goodwill, %, (12 months) 9,2 20,8 10,1 23,6 10,2 18,9
Return on invested capital, %, (12 months) 1,7 8,7 1,7 8,9 1,7 6,3
Equity/assets ratio, % 48,8 57,5 53,2 56,9 52,7 57,6
Number of full-time employees on the closing date 631 501 631 501 631 490
Average number of shares before dilution, thousands 23 022 21 909 22 936 21 909 22 680 21 909
Average number of shares after dilution, thousands 23 022 21 909 22 936 21 909 22 680 21 909
Equity per share, SEK 34,49 34,53 33,57 33,92 34,18 33,68
===== SIDA 15 =====
15 | Balco Group Interim Report 1 January - 30 September 2024
Parent Company, income statement in summary
Parent company, balance sheet in summary
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Net sales 6,0 6,2 17,8 18,4 25,8 26,4
Administrative expenses -4,5 -3,9 -15,4 -13,3 -26,8 -24,7
Operating profit 1,4 2,3 2,4 5,1 -1,0 1,7
Interest income and similar profit/loss items 3,1 0,8 7,6 4,0 10,6 6,9
Interest expenses and similar profit/loss items -5,2 -5,0 -18,2 -14,4 -23,3 -19,4
Dividend / result from group company 4,8 - 277,5 12,7 302,7 37,9
Profit/loss after financial items 4,1 -2,0 269,3 7,3 289,1 27,0
Appropriations - - - - 47,9 47,9
Tax 0,1 0,4 1,7 1,1 -7,2 -7,7
Net profit/loss for the period 4,3 -1,6 271,0 8,4 329,8 67,1
In the Parent Company there are no items that are reported as other comprehensive income, so total comprehensive income is consistent with the profit for the period.
30-sep 30-sep 31-dec
MSEK 2024 2023 2023
ASSETS
Non-current assets
Financial assets
Shares in group companies 1 080,0 745,7 1 458,2
Other non-current assets 3,7 2,9 3,4
Total non-current assets 1 083,7 748,5 1 461,6
Current assets
Receivables from group companies 194,8 154,7 89,7
Other current receivables 17,0 39,1 6,2
Cash and cash equivalents 34,4 14,0 -
Total current assets 246,2 207,8 95,8
TOTAL ASSETS 1 329,9 956,4 1 557,4
EQUITY AND LIABILITIES
Equity
Restricted equity 138,1 131,5 131,5
Non-restricted equity 691,0 333,2 375,5
Total equity 829,1 464,7 507,0
LIABILITIES
Non-current liabilities
Liabilities to credit institutions 324,3 150,0 150,0
Other non-current liabilities 32,2 15,8 10,9
Total non-current liabilities 356,5 165,8 160,9
Current liabilities
Liabilities to credit institutions - - 3,4
Liabilities to group companies 120,7 316,1 874,7
Other current liabilities 23,7 9,8 11,4
Total current liabilities 144,3 325,9 889,6
TOTAL EQUITY AND LIABILITIES 1 329,9 956,4 1 557,4
===== SIDA 16 =====
16 | Balco Group Interim Report 1 January - 30 September 2024
Notes
Note 1 Accounting principles
This summary consolidated interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and
relevant provisions of the Swedish Annual Accounts Act. The interim report for the Parent Company has been prepared in accord ance
with RFR 2 and Chapter 9, Interim Reports, of the Swedish Annual Accounts Act. For both the Parent Company and the Group, the same
accounting policies and computation methods have been applied as in the 2023 Annual Report, which was prepared in accordance with
International Financial Reporting Standards and Interpretations as adopted by the EU. The information on pages 1 -9 relating to the part
of the year covered by this interim report constitutes an integral part of this financial report.
Note 2 Financial instruments
The financial instruments measured at fair value are forward exchange contracts. Financial assets at fair value amounted to 0,0 MSEK (0.7)
at the end of the period while financial liabilities at fair value amounted to 0,0 MSEK (1.0). The fair values of financial instruments are
determined using valuation techniques. Market information is used as far as possible when available, while company-specific information
is used as little as possible. If all key inputs required for the fair valu e measurement of an instrument are observable, the instrument is
categorized in level 2. Reported value of trade receivables, other receivables, cash and cash equivalents, trade payables and other liabilities
constitutes a reasonable approximation of fair value.
Note 3 Business segments
Balco reports the following segments:
Renovation: includes replacement and expansion of existing balconies and installation of new balconies on apartment buildings without
balconies. The segment’s main market driver is the age profile of the residential property portfolio .
New Build: includes installation of balconies in conjunction with the construction of apartment buildings and balcony solutions in the
maritime area. The segment is driven mainly by the rate of new residential construction.
Jul-Sep
MSEK 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023
Net sales – External revenue 246,6 225,0 84,4 28,3 - - - - 331,0 253,3
Net sales – Internal revenue - - - - 6,0 6,2 -6,0 -6,2 - -
Total sales 246,6 225,0 84,4 28,3 6,0 6,2 -6,0 -6,2 331,0 253,3
Operating profit (EBIT) 9,2 14,1 2,4 1,5 -2,2 -3,3 - - 9,5 12,3
Depreciation included with 9,6 9,8 3,4 0,2 - - - - 13,0 10,0
of which amortization 1,6 1,7 0,5 - - - - - 2,1 1,7
Items affecting comparison 3,9 0,2 0,3 - 0,7 1,0 - - 5,0 1,2
Adjusted operating profit (EBITA) 14,8 15,9 3,2 1,5 -1,4 -2,2 - - 16,6 15,2
Adjusted operating margin 6,0% 7,1% 3,8% 5,1% 5,0% 6,0%
Operating profit (EBIT) 9,2 14,1 2,4 1,5 -2,2 -3,3 - - 9,5 12,3
Finance income - - - - 0,4 0,9 - - 0,4 0,9
Finance cost - - - - -9,2 -5,8 - - -9,2 -5,8
Profit before tax 9,2 14,1 2,4 1,5 -10,9 -8,2 - - 0,8 7,3
Jan-Sep
MSEK 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023
Net sales – External revenue 719,5 846,3 312,0 79,1 - - - - 1 031,5 925,4
Net sales – Internal revenue - - - - 17,8 18,4 -17,8 -18,4 - -
Total sales 719,5 846,3 312,0 79,1 17,8 18,4 -17,8 -18,4 1 031,5 925,4
Operating profit (EBIT) 24,7 61,9 11,6 3,0 -6,4 -2,5 - - 29,9 62,3
Depreciation included with 30,0 31,2 9,5 2,2 - - - - 39,5 33,4
of which amortization 4,2 4,9 3,2 0,2 - - - - 7,4 5,1
Items affecting comparison 7,2 5,1 0,9 - 6,1 1,9 - - 14,2 7,0
Adjusted operating profit (EBITA) 36,2 71,9 15,6 3,1 -0,2 -0,6 - - 51,5 74,5
Adjusted operating margin (EBITA) 5,0% 8,5% 5,0% 4,0% 5,0% 8,0%
Operating profit (EBIT) 24,7 61,9 11,6 3,0 -6,4 -2,5 - - 29,9 62,3
Finance income - - - - 2,7 2,7 - - 2,7 2,7
Finance cost - - - - -23,8 -12,7 - - -23,8 -12,7
Profit before tax 24,7 61,9 11,6 3,0 -27,5 -12,5 - - 8,8 52,4
Renovation New Build Group-wide Eliminations Total
TotalRenovation New Build Group-wide Eliminations
===== SIDA 17 =====
17 | Balco Group Interim Report 1 January - 30 September 2024
Note 4 Reconciliation with IFRS financial statements
Balco’s financial statements include alternative performance measures, which complement the measures that are defined or specified in
applicable rules for financial reporting. Alternative performance measures are presented since, as in their context, they provide clearer or
more in-depth information than the measures defined in app licable rules for financial reporting. The alternative performance measures
are derived from the Company’s consolidated financial reporting and are not measured in accordance with IFRS.
30-sep 30-sep 31-dec
MSEK 2024 2023 2023
Interest-bearing net debt incl leasing debt
Non-current interest-bearing liabilities 385,1 229,0 225,4
Current interest-bearing liabilities 13,1 15,1 19,0
Cash and cash equivalents -39,4 -21,6 -2,8
Interest-bearing net debt incl leasing debt 358,8 222,6 241,6
Adjusted EBITDA (R12) 108,2 147,7 127,4
Interest-bearing net debt/EBITDA (R12), times 3,3 1,5 1,9
Interest-bearing net debt excl leasing debt
Interest-bearing net debt incl leasing debt 358,8 222,6 241,6
Leasing liabilities non-current -48,1 -54,3 -51,2
Leasing liabilities current -13,1 -14,8 -19,0
Interest-bearing net debt excl leasing debt 297,6 153,5 171,4
Interest-bearing net debt/EBITDA excl leasing (R12), times
Adjusted EBITDA (R12) 108,2 147,7 127,4
Leasing depreciations (R12) -18,8 -23,9 -20,2
Adjusted EBITDA (R12) excl leasing depreciations 89,5 123,9 107,1
Interest-bearing net debt/EBITDA excl leasing (R12), times 3,3 1,2 1,6
Return on capital employed
Equity 794,0 756,5 746,1
Interest-bearing net debt 358,8 222,6 241,6
Average capital employed 1 066,0 907,8 911,2
Adjusted operating profit (EBIT), (R12) 57,9 102,7 83,0
Return on capital employed, % 5,4 11,3 9,1
Equity/assets ratio
Equity attributable to owners of the parent company 794,0 756,5 746,1
Total assets 1 628,2 1 316,7 1 267,2
Equity/assets ratio, % 48,8 57,5 58,9
===== SIDA 18 =====
18 | Balco Group Interim Report 1 January - 30 September 2024
Jul-Sep Jul-Sep Jan-Sep Jan-Sep Oct-Sep Jan-Dec
MSEK 2024 2023 2024 2023 2023/24 2023
Adjusted operating profit (EBIT)
Operating profit (EBIT 9,5 12,3 29,9 62,3 38,0 70,4
Items affecting comparison
Re-structuring costs 4,2 0,2 8,1 5,1 13,7 10,7
Acquisition costs 0,7 1,0 6,1 1,9 6,2 1,9
Adjusted operating profit (EBIT) 14,5 13,5 44,2 69,4 57,9 83,0
Operating profit (EBITA) - - - - - -
Operating profit (EBIT) 9,5 12,3 29,9 62,3 38,0 70,4
Amortization 2,1 1,7 7,4 5,1 9,0 6,8
Operating profit (EBITA) 11,6 13,9 37,3 67,4 47,0 77,1
Adjusted operating profit (EBITA) - - - - - -
Adjusted operating profit (EBIT) 14,5 13,5 44,2 69,4 57,9 83,0
Amortization 2,1 1,7 7,4 5,1 9,0 6,8
Adjusted operating profit (EBITA) 16,6 15,2 51,5 74,5 66,9 89,8
EBITDA
Operating profit (EBIT) 9,5 12,3 29,9 62,3 38,0 70,4
Depreciation and amortization 13,0 10,0 39,5 33,4 50,4 44,3
EBITDA 22,4 22,3 69,4 95,7 88,4 114,7
Adjusted EBITDA
Adjusted operating profit (EBIT) 14,5 13,5 44,2 69,4 57,9 83,0
Depreciation and amortization 13,0 10,0 39,5 33,4 50,4 44,3
Adjusted EBITDA 27,4 23,5 83,6 102,8 108,2 127,4
Investments, excluding expansion investments
Investments in intangible fixed assets -1,5 -0,5 -2,5 -3,5 -4,6 -5,6
Investments in tangible fixed assets -0,5 -1,4 -2,9 -6,8 -3,8 -7,7
of which expansion investments 1,6 0,4 4,4 4,4 7,0 7,0
Investments, excluding expansion investments -0,4 -1,5 -1,0 -5,9 -1,4 -6,4
Operating cash flow
Adjusted EBITDA 27,4 23,5 83,6 102,8 108,2 127,4
Changes in working capital -28,5 -3,6 -1,8 -98,9 -20,4 -117,4
Investments, excluding expansion investments -0,4 -1,5 -1,0 -5,9 -1,4 -6,4
Operating cash flow -1,4 18,4 80,8 -2,0 86,4 3,6
Net Sales excluding acquisitions
Net Sales 331,0 253,3 1 031,5 925,4 1 321,0 1 214,9
Acquired net sales -109,2 -18,1 -315,7 -58,2 -322,0 -64,6
Net Sales excluding acquisitions 221,8 235,1 715,8 867,2 999,0 1 150,3
===== SIDA 19 =====
19 | Balco Group Interim Report 1 January - 30 September 2024
Note 5 Acquisition
On January 22, Balco Group entered into an agreement on and completed the acquisition of all shares in Riikku Group Oy, one of Fin-
land's leading companies in balcony glazing. The acquisition is consolidated from 1 January 2024 and is expected to contribute posi-
tively to earnings per share during the full year 2024.Through the acquisition, Balco Group establishes a strong position in the Finnish
balcony market and strengthens the range in the new construction segment. The acquisition also strengthens Balco Group's market
position in the Nordics, in line with the group's long-term strategy.
Riikku Group Oy was founded in 2005 and is one of Finland's two largest balcony glazing companies. The company mainly works with
new build, but also sells in the renovation segment. Riikku's head office is in Alavus, Finland and has sales offices in several Finnish cities
as well as subsidiaries in Sweden, Norway, and Finland. The Riikku Group had a turnover of approximately 40 MEUR in 2023 with an
operating margin that was slightly lower than Balco Group's. Riikku has a modern and well-invested production facility of approximately
7,500 m2 in Alavus. Riikku and its subsidiaries will continue to be run by the current management with Joakim Petersen-Dyggve as Man-
aging Director.
The agreed purchase price amounts to 15 MEUR on a cash and debt-free basis. 3 MEUR will be paid with newly issued shares to Riikku's
former owners. The remaining 12 MEUR is financed with own cash and was paid half upon entry and half over the next four years with a
quarter per year. The acquisition calculation is preliminary.
On March 6, Balco Group entered into an agreement and completed the acquisition of sixty percent of the shares in Suomen
ohutlevyasennus Oy, a Finnish general contracting and facade company. The acquisition is consolidated from 1 March 2024 and is ex-
pected to contribute positively to earnings per share during the full year 2024.
Through the acquisition, Balco Group further strengthens its position on the Finnish market and expands the offer in the renovation
segment as well as in turnkey and green transformation. Balco Group's latest acquisition Riikku is a major supplier to Suomen Ohutle-
vyasennus and together the two acquisitions lead to the group establishing itself as a leading player in Finland.
Suomen ohutlevyasennus Oy was founded in 1984 and is a turnkey company with facade renovation as an area of expertise. The pro-
jects mainly include facade renovation with additional insulation and often installation of balcony glazing. Over 90 percent of the com-
pany's turnover comes from the renovation segment, and the customers are tenant-owned associations and construction companies.
The company is located in Turku, Finland and had a turnover of just over 11 MEUR in 2023 with a higher operating margin than Balco
Group's for several years. Suomen ohutlevyasennus will continue to be run by co-owners Jukka Stam and Mikko Jokinen.
The agreed purchase price amounts to 5.4 MEUR for 60 percent of the shares on a cash and debt-free basis. 1.4 MEUR is paid with
newly issued shares to Suomen ohutlevyasennus’ previous owners. The remaining EUR 4 million is financed with own cash and the ac-
cess was paid. The acquisition calculation is preliminary.
The purchase price comprises the following components (MSEK)
Cash payment 78,5
Present value calculated future payments 39,2
Aquired net assets -117,7
Goodwill -
The following assets and liabilities were included in the acquisition (M
Cash and cash equivalents 2,2
Tangible fixed assets 64,3
Intangible assets 104,6
Inventories 15,9
Receivables 84,3
Liabilities -133,8
Deferred tax liabilities -19,8
Acquired net assets 117,7
The purchase price comprises the following components (MSEK)
Cash payment 60,9
Aquired net assets -34,8
Goodwill 26,1
The following assets and liabilities were included in the acquisition (M
Cash and cash equivalents 4,3
Tangible fixed assets 9,8
Intangible assets 44,3
Receivables 11,1
Liabilities -25,4
Deferred tax liabilities -9,3
Acquired net assets 34,8
===== SIDA 20 =====
20 | Balco Group Interim Report 1 January - 30 September 2024
Alternative performance measures
This interim report contains references to several performance measures. Some of these measures are defined in IFRS, while others are
alternative measures and are not reported in accordance with applicable financial reporting frameworks or other legislation. The measures
are used by Balco to help both investors and management to analyze its operations. The measures used in this interim report are described
below, together with definitions and the reason for their use.
Alternative performance measures Definition Reason for use
Return on equity Income for the period divided by the average
shareholder equity for the period. The average
calculated as the average of the opening balance
and the closing balance for the period.
Return on equity shows the return that is generated
on the shareholders’ capital that is invested in the
company.
Return on capital employed Adjusted EBITA as a percentage of average capi-
tal employed for the period. The average calcu-
lated as the average of the opening balance and
the closing balance for the period.
Return on capital employed shows the return that is
generated on capital employed by the company and
is used by Balco to monitor profitability as it relates to
the capital efficiency of the company.
Return on capital employed ex-
cluding goodwill
Adjusted EBITA as a percentage of average capi-
tal employed for the period excluding goodwill.
Average calculated as the average of the opening
balance and the closing balance for the period.
Balco believes that return on capital employed ex-
cluding goodwill together with return on capital em-
ployed shows a complete picture of Balco's capital ef-
ficiency.
Gross income Revenue less production and project costs. Shows the effectiveness of Balco's operations and to-
gether with EBIT provides a complete picture of the
operating profit generation and expenses.
Gross margin Gross income as a percentage of net sales. Ratio is used for analysis of the company’s effective-
ness and profitability.
EBITDA Earnings before interest, tax, depreciation, and
amortization.
Balco believes that EBITDA shows the profit generated
by the operating activities and is a good measure of
cash flow from operations.
Interest-bearing net debt relative
to adjusted EBITDA
Interest-bearing external net debt divided by ad-
justed EBITDA.
Balco believes this ratio helps to show financial risk
and is a useful measure for Balco to monitor the level
of the company’s indebtedness.
Adjusted EBITDA EBITDA as adjusted for items affecting compara-
bility. For a reconciliation of adjusted EBITDA to
income for the period.
Balco believes that adjusted EBITDA is a useful meas-
ure for showing the company’s profit generated by
the operating activities after adjusting for items af-
fecting comparability, and primarily uses adjusted
EBITDA for purposes of calculating the company’s op-
erating cash flow and cash conversion.
Adjusted EBITDA margin Adjusted EBITDA as a percentage of net sales. Balco believes that adjusted EBITDA margin is a useful
measure for showing the company’s profit generated
by the operating activities after non-recurring items.
Adjusted EBIT margin Adjusted EBIT as a percentage of net sales. Balco believes that adjusted EBIT margin is a useful
measure for showing the company’s profit generated
by the operating activities.
Adjusted EBIT EBIT adjusted for items affecting comparability.
For a reconciliation of adjusted EBIT to income for
the period.
Balco believes that adjusted EBITA is a useful measure
for showing the company’s profit generated by the
operating activities, and primarily uses adjusted EBIT
for calculating the company’s return on capital em-
ployed.
Adjusted EBITA margin Adjusted EBITA as a percentage of net sales. Balco believes that adjusted EBITA margin is a useful
measure for showing the company’s profit generated
by the operating activities.
Adjusted EBITA EBITA adjusted for items affecting comparability.
For a reconciliation of adjusted EBIT to income for
the period.
Balco believes that adjusted EBIT is a useful measure
for showing the company’s profit generated by the
operating activities, and primarily uses adjusted EBIT
for calculating the company’s return on capital em-
ployed.
Items affecting comparability Items affecting comparability are significant
items reported separately due to their size or fre-
quency, e.g., restructuring costs, write-downs, di-
vestments, and acquisition costs.
Balco believes that adjustment for items affecting
comparability improves the possibility of comparison
===== SIDA 21 =====
21 | Balco Group Interim Report 1 January - 30 September 2024
Alternative performance measures Definition Reason for use
over time by excluding items with irregularity in fre-
quency or size. This is to give a more accurate picture
of the underlying operating profit.
Operating cash conversion Operating cash flow divided by adjusted EBITDA. Balco believes this is a good measure for comparing
cash flow with operating profit.
Operating cash flow Adjusted EBITDA increased/decreased with
changes in net working capital less investments,
excluding expansion investments.
Operating cash flow is used by Balco to monitor busi-
ness performance.
Organic growth Net sales excluding acquired growth current pe-
riod divided by net sales during the correspond-
ing period last year.
Organic growth excludes the effects of changes in the
Group's structure, which enables a comparison of net
sales over time.
Interest-bearing net deb
The sum of non -current interest-bearing liabili-
ties and current interest-bearing liabilities.
Balco believes interest -bearing net debt is a useful
measure to show the company’s total debt financing.
Net working capital Current assets excluding cash and cash equiva-
lents and current tax assets less non -interest-
bearing liabilities excluding current tax liabilities.
This measure shows how much net working capital
that is tied up in the operations and can be put in re-
lation to sales to understand how effectively net
working capital tied up in the operations is used.
EBIT margin EBIT as a percentage of net sales. Balco believes EBIT margin is a useful measure to-
gether with net sales growth and net working capital
to monitor value creation.
EBIT Earnings before interest and tax. Balco believes that EBIT shows the profit generated by
the operating activities.
EBITA margin EBITA as a percentage of net sales. Balco believes EBITA margin is a useful measure to-
gether with net sales growth and net working capital
to monitor value creation.
EBITA EBIT excluding amortization on acquired intangi-
ble assets.
Balco's growth strategy includes acquiring compa-
nies. In order to better illustrate the development of
the underlying business, the management has chosen
to follow EBITA, which is an expression of the operat-
ing profit before depreciation and write-downs of ac-
quired intangible assets.
Equity/asset ratio Equity divided on total assets. Balco believes that equity to asset ratio is a useful
measure for the company's survival.
Capital employed Equity plus interest-bearing net debt. Capital employed is used by Balco to indicate the
general capital efficiency of the company.
Capital employed excluding good-
will
Capital employed minus goodwill. Capital employed excluding goodwill is used together
with capital employed by Balco as a measure of the
company's capital efficiency.
===== SIDA 22 =====
Balco Group in brief
Balco Group is a market leader in the balcony industry, where we develop, manufacture, sell,
and take responsibility for the installation of our own bespoke open and glazed balcony sys-
tems. The Group's customized products contribute to enhanced quality of life, security, and
increased value for residents in multi-occupancy buildings. Furthermore, Balco Group's stand-
ardized glazing systems result in reduced energy consumption.
631 employees
Balco Group was established in 1987 and is a group
consisting of producing and selling companies. The
group is the market leader in the Nordics and operates
in several markets in northern Europe. The head office
is in Växjö, and the group has approximately 650 em-
ployees. A general and distinctive feature of the com-
panies in the Group is that they control the entire
value chain - from sales work to installed balcony -
through a decentralised and efficient sales process.
7 markets
1,321 MSEK net sales R12
35,000 sqm total production area