Inwido

Second quarter

• All business areas reported a higher order intake, with an overall increase of 22 percent compared with the corresponding quarter in the preceding year.
• The order backlog amounted to SEK 2,654 million, an increase of 68 percent (up 10 percent organically) compared to the corresponding quarter in the preceding year.
• Net sales amounted to SEK 2,331 million (2,263), up 3 percent. Organic growth amounted to negative 5 percent.
• Operating EBITA rose to SEK 263 million (261) and the operating EBITA margin amounted to 11.3 percent (11.6).
• Earnings per share amounted to SEK 2.52 (3.36), impacted by items affecting comparability and positive currency effects in net financial items for the previous year.
• Net debt amounted to a multiple of 1.4 in relation to operating EBITDA (1.1 excluding IFRS 16).
• Inwido refinanced its main sustainability-linked credit agreement after the end of the quarter.

January–June 2024

• Net sales amounted to SEK 4,142 million (4,358), down 5 percent. Organic growth amounted to a negative 13 percent.
• EBITA amounted to SEK 324 million (429) and the EBITA margin amounted to 7.8 percent (9.8).
• Operating EBITA amounted to SEK 354 million (430) and the operating EBITA margin amounted to 8.5 percent (9.9).
• Earnings per share amounted to SEK 2.89 (5.26).

CEO Comments:

We are both proud and humble to report on the second quarter of the year, during which order intake increased by 22 percent in total and 10 percent organically. This is resulting in a strong order backlog, up 68 percent (up 10 adjusted for acquisitions) compared to the corresponding period in the preceding year. Net sales increased by 3 percent over the quarter, to SEK 2,331 million (2,263). Operating EBITA is increasing slightly compared to the same period in the preceding year, to SEK 263 million (261), with an operating EBITA margin of 11.3 percent (11.6).  

Considering the challenging market we are still experiencing, not least in respect of new build in Finland and Sweden, I can state that our business units have been progressive and, in some areas, have won market share during the spring. In most cases, they have done this while also maintaining their margins. The increased order intake is particularly evident in the e-Commerce business area, which is continuing to win market share, as well as in the Western Europe business area, where the Irish company Carlson received the largest single order to date in Inwido’s history in June, worth in the region of SEK 110 million. However, it should be noted that order intake is increasing in all our business areas.

In the key performance indicators for sustainability work, the unit-related figures in the field of the environment continue to be challenged by lower volumes, although the absolute figures are pointing in the right direction. The key performance indicators for sick leave, health and safety are continuing to improve, while the key performance indicator regarding the frequency of accidents in the workplace is decreasing significantly. Another positive aspect is the fact that the amount of waste is continuing to decrease.  Our high ambitions in respect of sustainability are attracting ever more attention externally, and Inwido was listed among “Europe’s 500 climate leaders 2024” by the Financial Times during the quarter. We have also secured another credit agreement linked to sustainability, this time worth SEK 1.5 billion. In addition to extending the profile of Inwido’s overall debt portfolio, this new agreement is also in line with our short-term commitment under the Science Based Targets initiative (SBTi).

Business area Scandinavia is continuing to be affected by the decline in volume in the new build market. Despite a 7 percent decrease in sales, the gross margin increased, resulting in an EBITA margin of 14.2 percent (14.3), which is on a par with the preceding year. With their strong positions and offerings, it is principally the Danish companies that are benefiting from increasing activity in the consumer market.

Business area Eastern Europe, and especially Finland, is being affected by the sharp slowdown in the volume of new build. The 22 percent drop in sales during the quarter resulted in the operating EBITA margin falling to 5.5 percent (13.0). It is important to note, however, that the comparison figures are at a historically high level when it comes to profitability.

Business area e-Commerce has continued the positive trend and is considered to have advanced its position in all markets. Sales increased by 15 percent compared to the corresponding period in 2023. The increase in volume and a higher gross margin contributed to the significantly increased operating EBITA margin of 10.8 percent (3.9).

Business area Western Europe, which has developed strongly since last year’s acquisition of Sidey Group, also continued to deliver during the second quarter, now also organically. The business area’s sales increased by 108 percent, operating EBITA increased by 248 percent, and the EBITA margin increased to 11.4 percent (6.8).

Outlook
Three months after taking up the position of President and CEO of Inwido, I can observe that this is a well-functioning company characterized by a high level of activity, great professionalism, and a firm belief that we will achieve our long-term goal of a turnover of SEK 20 billion by 2030. Acquisitions are an important element in reaching this goal, and considering how many discussions I have already been involved in, I can state that the climate has improved significantly this spring. At the same time, our business units are focusing diligently on continued profitable, organic growth. 

In the longer term, there are a considerable number of external driving forces that are benefiting the long-term growth of energy-efficient windows and doors. The EU has clear ambitions as regards raising the energy performance of buildings in the years to come, which are starting to attract more and more attention. In this respect, both the media and analyst reports are highlighting companies in the renovation market that are benefiting from the directives, including Inwido. In the short term – with a strong order book, an ever lower rate of inflation and hopes of reduced interest rates – we are looking forward to the second half of the year with cautious optimism.

MALMÖ, JULY 12, 2024

Fredrik Meuller,  
President and CEO