SRV Interim Report January-
July-
- Revenue amounted to
EUR 146.9 (186.8) million.
-
Operative operating profit amounted to
EUR 4.6 (3.9) million with an operating profit ofEUR -4.9 (5.5) million. The divestment ofSRV Russia Oy had aEUR -9.5 million impact on operating profit, of whichEUR -9.3 million consisted of the recognition of translation differences in income.
-
Cash flow from operating and investment activities totalled
EUR -4.6 (4.5) million.
-
New agreements valued at
EUR 132.5 (135.0) million were signed in July-September.
January-
- Revenue amounted to
EUR 428.3 (588.9) million.
-
Operative operating profit amounted to
EUR -1.3 (18.7) million with an operating profit ofEUR -9.9 (-70.1) million. The divestment ofSRV Russia Oy had aEUR -9.5 million impact on operating profit, of whichEUR -9.3 million consisted of the recognition of translation differences in income.
-
The result before taxes was
EUR -16.4 (-69.1) million.
-
Cash flow from operating and investment activities totalled
EUR -13.6 (-12.7) million.
- The equity ratio fell to 34.9 per cent (36.3% 9/2022) and gearing rose to 84.8 per cent (59.3% 9/2022). Excluding the impact of IFRS 16, the equity ratio was 49.5 (48.6) per cent and gearing was 5.1 (-5.4) per cent.
-
At period-end, the order backlog stood at
EUR 995.6 (717.1) million. New agreements valued atEUR 528.3 (337.3) million were signed in January-September. The sold share of the order backlog was 92.1 (87.8) per cent.
-
Earnings per share were
EUR -1.0 (-6.5).
Outlook (unchanged)
During 2023, SRV's revenue and result will be affected by several factors in addition to general economic trends, such as: the timing and amount of income recognition for SRV's own projects, which are recognised as income upon delivery; the margin of the order backlog and its development; the start-up of new contracts and development projects; the war that
Revenue in 2023 will mainly be generated by cooperative contracting and development projects sold to investors. At the beginning of 2023, the order backlog was strongly weighted towards cooperative contracting, which involves fewer risks but lower margins. The company therefore expects the largest proportion of its full-year earnings to be generated in the end of the year. The share of revenue accounted for by developer-contracted housing production will remain small in 2023.
- Full-year consolidated revenue for 2023 is expected to decrease in comparison to 2022 (revenue in 2022:
EUR 770.1 million ).
-
Operative operating profit is expected to be positive, but lower than in 2022 (operative operating profit in 2022:
EUR 18.9 million .
Significant events after the period
There were no significant events after the end of the review period.
President & CEO's review
"Market conditions continued to be challenging in the third quarter of 2023, and we do not expect a significant change for the better in the short term. Demand for housing construction has almost come to a halt, and demand for real estate investments has weakened considerably as a result of the rapid rise in interest rates. Public construction remains strong, and there have been favourable developments in demand for industrial investments in terms of both volume and operating models. Our own development is strong in relation to the market, thanks to our net debt-free status, the low number of unsold apartments, and an order backlog that has strengthened since the end of last year, particularly in business construction. Our operational controllability has developed favourably over the past two years, which is reflected in our improved occupational safety, adherence to schedules, improved financial performance and, I'm delighted to say, also customer satisfaction.
In spite of the challenging market situation, our revenue continued to experience slight quarter-on-quarter growth, driven by business construction. However, due to poor demand for housing construction, revenue fell short of the comparison period.
As expected, our operative operating profit for the quarter was relatively good in view of the circumstances:
Our order backlog remained strong in the third quarter of 2023, and was 39% better than in the comparison period. The order backlog will lead to increased revenue starting from the last quarter of this year when projects get up to full speed. The annex to the
The divestment of our Russian holdings proceeded during the review period, and in August we sold the share capital of our subsidiary
In October, SRV and the
I see our favourable development continuing for the rest of the year, although we do not expect any particular traction from the market. Looking further ahead, I believe the trends for urbanisation and regional concentration will continue in
1-9/ | 1-9/ | 7-9/ | 7-9/ | 1-12/ | |||
(IFRS, milj. eur) | 2023 | 2022 | change | change, % | 2023 | 2022 | 2022 |
Revenue | 428.3 | 588.9 | -160.6 | -27.3 | 146.9 | 186.8 | 770.1 |
Operative operating profit | -1.3 | 18.7 | -20.0 | -106.9 | 4.6 | 3.9 | 18.9 |
Operative operating profit, % | -0.3 | 3.2 | -3.5 | 3.1 | 2.1 | 2.5 | |
Operating profit | -9.9 | -70.1 | 60.2 | -4.9 | 5.5 | -76.4 | |
Operating profit, % | -2.3 | -11.9 | 9.6 | -3.4 | 2.9 | -9.9 | |
Profit before taxes | -16.4 | -69.1 | 52.6 | -6.5 | 5.8 | -79.1 | |
Net profit for the period | -14.4 | -76.7 | 62.3 | -6.6 | 5.3 | -85.7 | |
Net profit for the period, % | -3.4 | -13.0 | 9.7 | -4.5 | 2.9 | -11.1 | |
Earnings per share2) | -1.0 | -6.5 | 5.5 | -0.5 | 0.4 | -6.6 | |
Order backlog (unrecognised) | 995.6 | 717.1 | 278.5 | 38.8 | 838.8 | ||
Equity ratio, % | 34.9 | 36.3 | -1.5 | 36.3 | |||
Equity ratio, %, excl. IFRS 16 1) | 49.5 | 48.6 | 0.9 | 48.2 | |||
Net gearing ratio, % | 84.8 | 59.3 | 25.5 | 55.1 | |||
Net gearing ratio, %, excl. IFRS 16 1) | 5.1 | -5.4 | 10.6 | -7.5 | |||
Financing reserves | 63.9 | 61.8 | 2.1 | 3.4 | 65.9 |
1.The figure has been adjusted to remove the impacts of IFRS 16.
2. The key figure for the comparison period has been adjusted, taking the 2022 share issues and reverse share split into account.
Business Review
January-
The Group's revenue declined by
The Group's operative operating profit decreased to
The Group's operating profit was
At period-end, the Group's order backlog stood at
July-
The Group's revenue declined by
After a loss-making start to the year, the Group's operative operating profit swung into the black at
The Group's operating profit was
Espoo,
Board of Directors
All forward-looking statements in this interim report are based on management's current expectations and beliefs about future events. The company's actual results and financial position may differ materially from the expectations and beliefs such statements contain due to a number of factors that have been presented in this interim report.
Briefing, webcast and presentation materials
A briefing for analysts, investors and media representatives will be held as a webcast on
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SRV in brief
SRV is a Finnish developer and innovator in the construction industry. We are building a more sustainable and responsible urban environment that fosters economic value and takes the wellbeing of both the environment and people into consideration. We call this approach lifecycle wisdom. Our genuine engagement and enthusiasm for our work comes across in every encounter - and listening is one of our most important ways of working. We believe that the only way to change the world is through discussion.
Our company, established in 1987, is listed on the
SRV - Building for life
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https://mb.cision.com/Main/18314/3861723/2385929.pdf
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