Q3 2024 Lassila & Tikanoja Oyj Earnings Call Transcript
Key Points
- Lassila & Tikanoja Oyj (STU:LT5) reported solid performance in the circular economy businesses despite challenging market conditions.
- Facility services in Finland showed significant improvement, with operating profit doubling from the previous year.
- The company successfully managed to offset the impact of municipalization in environmental services through strong performance among B2B customers.
- Sustainability efforts are yielding positive results, with a significant reduction in CO2 emissions and improved work safety metrics.
- The company's financial position has strengthened, with improved cash flow and a slight decrease in the weighted average effective interest rate.
- Facility services in Sweden continue to face challenges, with poor profitability in public sector contracts and a disappointing demand for additional sales.
- The construction industry in Finland is expected to remain slow, negatively impacting the environmental construction segment.
- Earnings per share and return on capital employed have decreased, affected by non-recurring items and increased net finance costs.
- The strategic turnaround in Sweden is taking longer than expected, with deep-rooted problems persisting.
- Elevated ERP costs are impacting financials, with the full benefits of new systems not expected until the second half of next year.
Hello, everyone and welcome to Lassila & Tikanoja third quarter result webcast. The webcast is hosted by L&T's CEO Eero Hautaniemi and CFO Joni Sorsanen. So, there's an opportunity to ask questions at the end of the broadcast but without further ado Eero the floor is yours.
Thank you, Inka and welcome also on my behalf to this earnings release for the first nine months of 2024. At first few highlights overall solid performance in the circular economy businesses despite a quite challenging market environment. All business lines in facility services Finland improved over last year and the turnaround program is progressing well, also our sustainability work is yielding results and I'll, get to the details a little later in the presentation. But let's start with the net sales and as you can see in our circular economy businesses, we managed to actually grow a little bit our sales thanks to a good sales performance
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