Release Date: November 06, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Multiconsult ASA (FRA:3MC, Financial) reported a strong operational performance with a billing ratio of 71.2%, supported by high organic growth.
- The company achieved a significant increase in net operating revenue, up 17.5% from the previous year.
- EBITA increased by 252.3% to NOK 102.9 million, reflecting improved profitability.
- The order backlog remains robust at NOK 4.8 billion, providing a solid foundation for future operations.
- Multiconsult ASA (FRA:3MC) continues to see a strong pipeline of projects, particularly in defense infrastructure and sustainability, driving demand.
Negative Points
- There was a reduction in sales and order backlog due to peak production in some large projects, which was expected.
- The architecture segment, particularly in Oslo, faced challenging market conditions, leading to temporary layoffs.
- The company experienced a negative calendar effect impacting financial results by NOK 6.1 million in the quarter.
- The international segment saw a slight decrease in EBITA, despite increased net operating revenues.
- Increased competition and uncertainty in parts of the market could pose challenges to sustaining growth.
Q & A Highlights
Q: Can you provide more details on your expectations for the billing ratio going forward, considering the peak production in some projects?
A: We have managed to lift the billing ratio to a higher level, but expect fluctuations between quarters. We anticipate it will fluctuate between 70% to 73%.
Q: How long will the order backlog support the current billing ratios?
A: We have peak performance in some projects next year, but we are continuously filling up the backlog with new contracts, such as the recent NOK450 million defense contract. We are not concerned about maintaining the billing ratios.
Q: Could you elaborate on the infrastructure market in Sweden and your expectations?
A: We see slight improvements in the Swedish infrastructure market, but it will take time before these improvements reflect in our sales.
Q: How will the low growth in full-time equivalents (FTEs) impact organic growth going forward?
A: The engineering business has seen good recruitment, but the architecture business has faced layoffs. We are compensating with high billing ratios and maintaining full capacity.
Q: Can you explain the put option related to A-lab affecting financial income?
A: We bought 70% of A-lab in June 2023, with an option to purchase the rest in 2026. The value of this obligation has been reevaluated, resulting in a positive effect of NOK36 million year-to-date.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
