January – March 2015
- Net sales amounted to EUR 239 million (259), down 7.8%. The decrease in net sales was 5.8% at comparable exchange rates and excluding the Communication business in Norway, which in 2015 is deconsolidated, net sales increased by 3.2% or 5.3% at comparable exchange rates
- Operative EBITA* amounted to EUR 5.3 million (4.8) or 2.2% of net sales (1.8)
- Non-recurring items** were EUR -2.6 million (-0.4)
- EBITA totalled EUR 2.7 million (4.4) or 1.1% of net sales (1.7)
- Net financial expenses were affected by a non-cash expense of EUR 3.5 million (0.0) related to refinancing
- The net result was EUR -7.5 million (-3.6)
- Earnings per share were EUR -0.14 (-0.11)
- Operative cash flow* amounted to EUR -59.9 million (24.5), strongly impacted by IPO-related cash payments
Unless otherwise stated, figures in brackets refer to the same period previous year
* see definitions on pages 12 and 17
** IPO-related costs in 2015
Comments by the CEO: “Exciting first quarter for Eltel”
Our first quarter as a listed company was eventful. Apart from the listing itself, we also renewed our financing, completed an acquisition in Germany and signed a new five-year contract with TeliaSonera. Furthermore, we announced new contracts to install smart meters in Norway in the beginning of the second quarter.
The basic market trends in our Infranet market continue to support growth. This development is the result of demands by end-users for better availability and higher capacity in addition to regulators urging operators and utilities to invest to create higher flexibility, security and to support environmental initiatives.
Eltel’s performance fluctuates between quarters. The first quarter is often the weakest due to weather conditions and order flows from our customers. However, the first quarter of 2015 was favourable for most of our units and our performance is in line with or slightly better than the same period previous year.
For the Communication segment we focused on the launch of our renewed contract with TeliaSonera in the Nordics and Baltics as well as on implementation of our joint venture with Sønnico relating to the new contract for Telenor in Norway.
In the Power segment, power transmission order intake and sales declined slightly, with some projects being completed while other are in the latter part of the launch phase. Tendering activity remained high and we are entering the Norwegian smart metering market with more than 800.000 meter installations in Hafslund and Skagerak. We are proud of the trust that Hafslund has placed in us and view this as a strong confirmation of our prime position in this area. Our acquisition of Edi.Son in Germany is encouraging and will give us a good platform in this large and growing market.
The Transport & Security segment had a mixed start to the year with healthy growth of rail and road, albeit with a slightly lower margin due to the change in the mix that involved an increase in the project business. We also noted intensified competition for rail projects due to the attractiveness of the market, particularly in Norway and Sweden.
For the Group as a whole, our net sales were impacted by deconsolidation of our Communication business net sales in Norway. However, excluding this impact, steady growth was visible. Our net result for the first quarter was impacted by some non-recurring items related to both the IPO and our IPO refinancing. These costs have now been expensed according to plan and it will be easier to follow the regular performance of our business in coming quarters.
The cash generation in the first quarter was adversely impacted by our very strong cash collection in the final quarter of 2014. The weak cash generation in the first quarter was also the result of IPO-related payments, customer advances received in 2014 and above- normal supplier payments during the quarter.
In addition to our day-to-day activities we finalised our IPO process and were listed on the Nasdaq Stockholm Mid Cap on 6 February. The listing has been positive for us in many ways and we are grateful for the trust that many new shareholders have placed in us. All of this gives us even more energy and makes us more committed to the task of delivering on our targets of further improving our efficiency through the “Eltel Way” and supporting our continued growth.
–Axel Hjärne, CEO
For more information, please contact:
Gunilla Wikman, Head of Investor Relations
tel. +46 72 584 3630, email@example.com
About Eltel AB
Eltel is a leading European provider of technical services for critical infrastructure networks – Infranets – in the segments of Power, Communication and Transport & Security, with operations throughout the Nordic and Baltic regions, Poland, Germany, the United Kingdom and Africa. Eltel provides a broad and integrated range of services, spanning from maintenance and upgrade services to project deliveries. Eltel has a diverse contract portfolio and a loyal and growing customer base of large network owners. The number of employees is approximately 8,600 and in 2014, Eltel net sales amounted to EUR 1,242 million. Eltel’s share is listed on Nasdaq Stockholm since February 2015.