A word from the CEO
Nordisk Bergteknik reports a strong second quarter. The Group’s three segments have developed very satisfactorily with strong growth and record profitability in parts of the Group. We also continue to be active in the consolidation of our industry and have completed three new acquisitions which continue to strengthen our position as a strategic partner in the construction industry, in accordance with our plan. In total, we have made six acquisitions in Sweden and Norway in the last twelvemonth period. Measured as if these companies had been part of the Group since 1 July 2020, sales thus amounted to SEK 1 848 million with an adjusted EBIT margin of 5,9%, compared with the last calendar year’s SEK 1 008 million with a margin of 5,4%.
The Group’s net sales grew during the second quarter by 126% and amounted to SEK 490.5 (217.0) million.
The organic growth for the Group during was 50%, where all segments developed well. Adjusted operating profit (adjusted EBIT) amounted to SEK 46.6 (18.0) million, which is more than double the corresponding quarter last year. The strong financial development is a result of several factors, including that we have reached a significant size and scalability in the business, that we have continuously and consistently worked with project and financial management and that today we also consist of businesses that are not as machine and investment-heavy but more service-focused, which contributes to higher profitability. The number of employees in the Group increased from 646 to 751 during the quarter, mainly driven by acquisitions.
Nordisk Bergteknik continues to grow
Our acquisition work intensified during the quarter, where we completed and took on three new acquisitions; the founding company Grundia in Gothenburg, the machine service and transport company S Blomquist in Gothenburg and the Norwegian energy drilling company Kragerø. The first two acquisitions strengthen and broaden our presence in the Västra Götaland region, where we are expected to continue to have a high demand for many years to come. The work with Västlänken, to name an example requires our services in several disciplines and spans a total of about a hundred different projects over a period of 10-15 years to come.
During the second quarter, we also included declarations of intent for two new acquisitions, partly in rock work, excavation work and extraction based in Västerbotten, and partly in the foundation sector in Västra Götaland.
We have previously established a successful methodology for acquisitions and look forward to further strengthening our position as a strategic partner in the construction industry in both existing and new geographies.
It is also positive to note that the Swedish government has recently decided to implement all stages of the Norrbotnia line within the framework of the forthcoming national infrastructure plan, which also gives Nordisk Bergteknik opportunities to further contribute to the transformation to a greener Sweden.
We now see clear signs that both society in general and our customers are increasingly accelerating this structural transformation, which also applies to sustainability aspects in procurements and processes.
Record growth in Rock Sweden
Net sales in Rock Sweden increased in the second-quarter by 153%, of which as much as 75% was organic, to SEK 232.1 (91.6) million.
At the same time, the segment showed good profitability with an EBIT margin of 6.8% (3.5%), which is a significant improvement compared with the previous year. The organic growth was mainly linked to major projects around Västlänken in Västra Götaland and the Aitik mine in Norrbotten. The improved profitability is linked to new projects and higher volumes, but also to our recent acquisitions that have contributed to higher profitability levels.
Our acquisition of S Blomqvist, which was consolidated in June, complements the business well and means that we are broadening the value chain, especially in Västra Götaland, where collaborations with, among others, Bohus Bergsprängning are already underway.
Good growth in Rock Norway
Net sales in the Rock Norway segment increased during the second quarter by 170%, where organic growth amounted to 35%, to SEK 162.0 (60.1) million compared with the previous year. The EBIT margin decreased from 12.2% to 7.4%, but the EBIT result increased in absolute terms by SEK 4.4 million to SEK 12.3 (7.9) million during the period. The fact that profitability was negatively affected compared with the previous year is mainly due to the fact that we have established a third business area in Rock Norway, rock stabilisation, which has a seasonal pattern with a clearly stronger second half-year.
Overall, we continue to have a good and increasing demand for our services in the segment. We also look forward to starting work more across national borders as soon as the geographical restrictions with quarantine ease.
Foundation Sweden further strengthens profitability
During the second quarter, we had a high demand for our services in the Foundation Sweden segment. We acquired Gothenburg-based Grundia, which contributed to us increasing net sales by 48% during the second quarter, of which 28% was organic, to SEK 96.4 (65.3) million compared with the previous year. Profitability increased to an EBIT margin of 18.1% (12.0%). The increased profitability is largely due to more and more profitable projects as well as reduced use of subcontractors compared with the previous year.
Demand remains high in the segment, largely through all the infrastructure investments that are underway in Västra Götaland, and we see several interesting development opportunities in the future.
In terms of operations, our assessment is that the challenges of the pandemic are now more or less behind us and that the situation has normalized. In the coming six months, we hope that the situation will also be normalized across national borders and that we will be able to make greater use of the Group’s synergies between the countries. With a continued high demand for our services and good market prospects together with a diversified customer base, well-invested machinery and committed and knowledgeable employees, we are thus looking forward with anticipation.
CEO Nordisk Bergteknik