Eltel Group: Interim report January–September 2023

July–September 2023

  • Net sales EUR 213.4 million (207.0). Total growth 3.1% and organic growth1) in segments 8.3%
  • Adjusted EBITDA EUR 13.6 million (11.5)
  • Adjusted EBITA2) EUR 5.9 million (4.1) and adjusted EBITA margin 2.8% (2.0)
  • Adjusted EBITA2) in segments EUR 6.8 million (6.6) and adjusted EBITA margin in segments 3.5% (3.6)
  • Items affecting comparability EUR -0.9 million (0.0)
  • Operating result (EBIT) EUR 5.0 million (4.1) and EBIT margin 2.3% (2.0)
  • Net result EUR 1.8 million (-0.3)
  • Earnings per share EUR 0.00 (-0.00), basic and diluted
  • Cash flow from operating activities EUR 20.2 million (-30.6)

January–September 2023

  • Net sales EUR 609.9 million (599.6). Total growth 1.7% and organic growth1) in segments 8.0%
  • Adjusted EBITDA EUR 21.6 million (24.5)
  • Adjusted EBITA2) EUR -1.1 million (2.1) and adjusted EBITA margin -0.2% (0.4)
  • Adjusted EBITA2) in segments EUR 6.8 million (11.7) and adjusted EBITA margin in segments 1.2% (2.2)
  • Items affecting comparability EUR -7.1 million (0.0)
  • Operating result (EBIT) EUR -8.2 million (2.0) and EBIT margin -1.3% (0.3)
  • Net result EUR -17.9 million (-7.3)
  • Earnings per share EUR -0.13 (-0.05), basic and diluted
  • Cash flow from operating activities EUR -5.7 million (-30.6)
  • Net debt EUR 133.4 million (166.1)

Significant events during the reporting period

  • During the third quarter, Eltel signed contracts with a combined value of about EUR 171 million (406). Read more on page 13.
  • On 20 July, it was announced that Eltel Finland signed an agreement with Fingrid. The contract is worth about EUR 19 million.
  • On 22 August, it was announced that Eltel and Kempower have entered into an agreement to a value of EUR 15 million, until the end of 2025. Eltel will issue separate purchase orders annually.
  • On 28 August, it was announced that Eltel Finland has entered into a one-year extension of an agreement with Telia Finland. The agreement is worth about EUR 30 million.
  • On 26 September, it was announced that Eltel Sweden and the Swedish Defense Materiel Works, FMV, have signed a frame agreement. Estimated value of the three-year agreement is about SEK 320 million, EUR 27 million.
  • On 29 September, it was announced that Eltel Finland has signed an agreement with Fingrid. The contract is worth about EUR 23 million.

Key figures






EUR million

Jul-Sep 2023

Jul-Sep 2022

Jan-Sep 2023

Jan-Sep 2022

Jan-Dec 2022

Net sales






Net sales growth, %






Adjusted EBITDA






Adjusted EBITA2)






Adjusted EBITA margin, %






Adjusted EBITA2), segments






Adjusted EBITA margin, %, segments






Operating result (EBIT)






Return on operative capital employed (ROCE), %






Net working capital






Net debt






Number of employees, average






1) Organic growth is adjusted for currency effects.

2) Eltel follows the profitability of segments with adjusted EBITA, which does not include restructuring costs and other items affecting comparability. Eltel has changed its terminology since Q1 2023 from operative EBITA to adjusted EBITA for the purpose of additional clarity and alignment with market practice. Please see pages 25–26 for definitions of the key ratios.

Comments by the CEO

The third quarter was strong and stood out as one of our best in recent history. Not only did we maintain the strong growth, but all our country units, including High Voltage Poland, contributed to the positive result. The result was an important step toward sustainable profitability, a step to be followed by many more.

The positive net sales trend we witnessed earlier this year continued into the third quarter. Our intensified sales efforts have consistently driven volumes, leading to an 8.3% organic growth in the segments and a 6.8% increase in local currency for the Group. Like before, the demand for our services remained and we secured new contracts worth about EUR 171 million. The sustained momentum of growing net sales year-over-year reaffirms our ability to secure new business on improved terms and at increased prices.

The third quarter, traditionally our peak in terms of profitability, resulted in adjusted EBITA of EUR 5.9 million (4.1), clearly exceeding the previous year, and even more so compared with the first half of 2023. Key drivers behind this development include our higher pricing ambitions, price negotiations and indexing, as well as the effects of the restructuring and cost-saving program we implemented at the beginning of the year.

In Finland, market demand continues to be strong overall with some fluctuation between business areas. In our classic business, the Communication business performed particularly strong. During the quarter we also built the order book within Power Transmission, which will contribute to continued growth. Still, we are facing challenges in two Power Services agreements, but we are actively working on mitigating actions.

Sweden enjoyed its eighth consecutive quarter of growth year-over-year, and has been profitable for five straight quarters. The operations within Smart Grid and Fiber delivered a solid result, and we also built the orderbook in public infrastructure.

Like in previous quarters, Denmark continued to perform well, with a substantial increase in net sales and improved margins. This positive outcome reflects the country unit’s ability to drive growth from existing contracts as well as from new wins and success in increasing prices.

As seen throughout the year, net sales in Norway declined, primarily due to reduced customer investments in fiber. This dip in volume resulted in overcapacity, which negatively impacted profitability. In response, we implemented a second cost-saving program. This new program is projected to provide annual savings of EUR 2.3 million, and it came with a restructuring cost of EUR 0.9 million. Measures from this program included, among others, reducing our workforce by about 60 full-time employees. On the positive side, we see the beneficial effects from the first cost-saving program, implemented in Q1, and indications suggest that volumes in Norway are stabilizing, even if it is at a lower level than before.

I am pleased that High Voltage Poland showed profitability improvement during the quarter. This proves that our strategy to reduce risks by narrowing the scope of the business is paying off. This is a promising development, but we are aware of the complex challenges in the Polish market.

The powerful megatrends of electrification and digitalization continue to shape our market, and we increasingly see new opportunities emerging. We are accelerating the development and implementing new businesses in the green transition, particularly in solar PV and e-Mobility. We are currently involved in multiple tendering processes, and this week, ground works begin at our first utility-scale solar farm project in Finland. We have also signed several contracts in e-Mobility, including a notable Nordic agreement with Kempower.

During the quarter, we observed heightened sustainability expectations from our customers. Eltel welcomes this trend, as we see it as a potential competitive advantage. An increasing number of customers are asking about our commitments and inviting us to discuss collaborative initiatives. Together with our customers, we are contributing to a sustainable future.

Håkan Dahlström, President & CEO

For further information, please contact:

Tarja Leikas, CFO

Phone: +358 40 730 77 62, tarja.leikas@eltelnetworks.com

Elin Otter, Director, Communications and Investor Relations

Phone: +46 72 595 46 92, elin.otter@eltelnetworks.com

This information is information that Eltel AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 08:00 CET on 2 November 2023.

About Eltel

Eltel is a leading service provider for critical infrastructure that enables renewable energy and high-performing communication networks. Eltel designs, plans, builds and secures the operation of networks for a more sustainable and connected world today and for future generations. In total, we have about 5,000 employees and in 2022 the annual sales was EUR 823.6 million. The head office is located in Sweden and Eltel's shares have been listed on Nasdaq Stockholm since 2015. Read more at www.eltelnetworks.com.