Norva24

September-December 2024

• Growth in total operating revenue of 15.5%, driven by currency-adjusted organic growth of 6.2% and growth from acquisitions of 8.5%. Currency adjusted organic growth in all geographies.
• Total operating revenue amounted to NOK 988.6 million (855.7) for the quarter and NOK 3,631.0 million (3,151.9) for the year.
• Margin reduction due to Germany, leading to a reduction in adjusted EBITA margin for the Group of -1.3 percentage points. Increased margin in all the other segments.
• Profit for the period before taxes was NOK 56.5 million (23.4) for the quarter and NOK 245.9 million (233.7) in 2024.
• Basic/Diluted earnings per share amounted to NOK 0.27 (0.37) for the quarter and NOK 0.97 (1.24) for the year.
• Strong operating cash flow of NOK 298.2 million (206.4) for the quarter and NOK 660.6 million (515.8) for the year representing an increase of 28% for the year compared to 2023.
• On October 15, 2024, Norva24 Group signed a new credit facility agreement with Danske Bank and Skandinaviska Enskilda Banken, replacing the current credit facility in place. The new agreement extends the credit facility for 2 years and increases the facility amount from NOK 1.1 billion to NOK 1.85 billion. In all material aspects, there are no other changes compared to the previous agreement.

Significant events after the reporting period

• On January 8, 2025, Norva24 signed an agreement to acquire 100% of the shares in Kanaltechnik Agricola GmbH.
• On January 31, 2025, the decision by the Norwegian Competition Appeals Tribunal to prohibit the acquisition of Vitek Miljø AS was published. The SPA has been terminated by Norva24.
• On January 27, 2025, it was announced that Tore Hansen, CEO Norway, will leave the role as of February 1, 2025.
  

Solid development in core operations and strong cash flow

Looking back on the fourth quarter of 2024 I am proud that we have continued the strong revenue growth across all segments and improved margins for three of four markets. In addition we improved the operating cash flows in all our markets through improved working capital management. We are laying the groundworks for even more structured work on operational efficiency through both implementing our margin improvement methodology and the implementation of the business process tools in the German operations.

We are pleased to report a solid quarterly growth of 15.5%, driven by a currency-adjusted organic growth of 6.2%. All our markets have experienced revenue growth, with Norway and Sweden showing currency-adjusted organic growth rates between 7.5% and 8.5%. This growth has been achieved through a combination of increased utilization, higher prices, and new customer agreements. The adjusted EBITA was reduced compared to Q4 2023, due to the negative impact of Jutzy in Germany.

Norway, Sweden, and Denmark have all shown margin improvements ranging from 30 to 170 basis points compared to Q4 last year. The German operation is severely hampered by the underperforming unit in the Berlin area, Jutzy, and has a margin drop in the quarter of 320 basis points. Excluding Jutzy from the German financials, the segment had a strong organic revenue growth of 18.4%, a margin improvement of 3.8 percentage points for the quarter and 0.5 percentage points for the year, compared to the same periods in 2023. Excluding Jutzy, the Q4 Adj EBITA margin in Germany was 14.5%, and for the full year 2024, the Adj EBITA margin for Germany was 13.1%. The non-core project business of Jutzy is being discontinued and will during 2025 make up a very marginal part of the activity of our German business. The core UIM part of Jutzy is not facing the same issues as the project part, and will remain. Excluding Jutzy the organic growth in Germany was 10.1 % for 2024.

The last quarter of the year is seasonally strong in terms of cash flow. Cash from our operating activities in Q4 2024 was NOK 298 million compared to NOK 206 million last year. We have improved our working capital in all markets.

One of the action points from my last letter was the implementation of the Norva24 Playbook. During Q4 2024, nine branches across all segments have initiated this methodology, and we are expecting margin improvements in the first half of 2025.

In the first quarter I look forward to our Capital Markets Day on March 19 where we will present our updated strategy and financial targets for the next strategy period. In the meantime, as we move forward into 2025, I want to take a moment to reflect on the progress we have made and set the stage for the exciting opportunities ahead in the massive UIM market. We are the clear leader in Northern Europe and our strong financial position gives us the opportunity to continue our journey. I am very excited about the future for Norva24.

Henrik Norrbom

Group CEO

Webcast with teleconference at 09.30 (CET)

To participate in the conference and access the phone numbers, please use the link below.

Webcast/Teleconference:

https://financialhearings.com/event/48433

https://ir.financialhearings.com/norva-24-Q4-report-2024

For further information:
Henrik Norrbom, Group CEO
Tel. +46 72 708 1515
henrik.norrbom@norva24.com

Stein Yndestad, Group CFO
Tel: +47 916 86 696
stein.yndestad@norva24.com

ir@norva24.com