- Net sales amounted to EUR 1,012.7 million (857.6), up 20.6% in local currencies, organic net sales increased by 3.5%*
- Operative EBITA amounted to EUR 16.7 million (41.7) or 1.6% of net sales (4.9)
- No items affecting comparability (-1.7)
- EBITA amounted to EUR 16.7 million (40.0) or 1.6% of net sales (4.7)
- EBIT amounted to EUR 5.9 million (30.1)
- Net financial expenses decreased to EUR -8.1 million (-12.2)
- The net result amounted to EUR -1.8 million (25.9)
- Earnings per share was EUR -0.04 (0.42)
- Operative cash flow was negative at EUR 30.5 million (-44.6), cash conversion was 160.8% on a rolling 12-month basis
- Net sales amounted to EUR 356.2 million (310.8), up 16.2% in local currencies, organic net sales increased by 4.0%*
- Operative EBITA amounted to EUR 7.8 million (22.5) or 2.2% of net sales (7.2)
- EBITA amounted to EUR 7.8 million (23.3) or 2.2% of net sales (7.5)
- EBIT amounted to EUR 4.1 million (19.6)
- Net financial expenses amounted to EUR -2.0 million (-2.6)
- The net result amounted to EUR 1.9 million (25.2)
- Earnings per share was EUR 0.02 (0.39)
- Operative cash flow was positive at EUR 22.6 million (-7.4)
Unless otherwise stated, figures in brackets refer to the same period in the previous year
* Organic net sales excludes Vete acquisition in 2015, U-SERV acquisition in 2016, and the Norwegian Communication business until 1 September 2016 (Eltel Sønnico) and is presented using comparable exchange rates.
Comments by the CEO
Focus on restoring financials
My first few weeks as CEO of Eltel has without doubt been hectic. The performance deviations in certain projects have been top priority for the management team. We take these performance deviations, communicated after the summer, very seriously and address them accordingly.
These challenges mainly affected profitability in the third quarter, with only a minor impact on net sales. Net sales growth amounted to 16% in the quarter. Growth was mainly driven by acquisitions but also by organic growth, especially within our fibre business in the Communication segment. The EBITA for the quarter amounted to EUR 8 million, in line with our communicated guidance on 14 October, most significantly burdened by the performance in Power segment and especially by certain electrification projects in Africa.
As earlier communicated, these challenges are expected to also impact net sales and profitability in the fourth quarter. Eltel estimates that EBITA for the full year 2016 will be in the range of EUR 27-32 million, indicating an EBITA for the fourth quarter in the range of EUR 10-15 million. In the estimate for the fourth quarter, management has also considered the increased impact of delayed customer investments in the Polish and German power markets and in the German communication sector as communicated in connection with the second quarter 2016 interim report.
Regarding 2017, management is now taking a more cautious stand concerning Eltel’s project business within power transmission in Africa and rail and road in Norway. Within the Power segment, it is estimated that net sales from power transmission will decrease in 2017 compared to the level in 2016.
Eltel’s management is currently carrying out a thorough review, including planning of permanent corrective actions, to restore the situation in this part of our business. The conclusions and an action plan will be in place during November.
Despite the challenges, the vast majority of Eltel’s operations are performing well. The project business, which accounts for approximately one third of total Group volumes, has demonstrated a profitable track record over many years. We have a sizeable committed order backlog that is well supported by both smart meter installations and fibre rollouts. In a longer term perspective, Eltel’s position within both the projects and service business for Infranets will remain strong.
–Håkan Kirstein, President and CEO
For further information:
VP – Investor Relations and Group Communications
Tel: +358 40 311 3009, email@example.com
This information is information that Eltel AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08.00 CET on 9 November 2016.