W5 Solutions

Significant events during Q3 2022
There are no significant events to report for the quarter.

Significant events after the end of the period
There are no significant events to report after the end of the period.

Financial Overview

JULY–SEPTEMBER 2022
• Operating income for the quarter amounted to MSEK 27.6 (24.8), an increase of 11%.
• Profit, EBITA, for the quarter amounted to MSEK 1.9 (0.9), an increase of 111%.
• Cash flow from operating activities amounted to MSEK -21.3 (-21.1).
• Orders received during the period amounted to MSEK 21 (48) with an order book at the end of the period of MSEK 217.

JANUARY–SEPTEMBER 2022
• Operating income for the nine-month period amounted to MSEK 101.3 (88.7), equivalent to an increase of 14%.
• Profit, EBITA, for the nine-month period amounted to MSEK 11.9 (13.2), which is equivalent to a decrease of 10%.
• Cash flow from operating activities amounted to MSEK -7.5 (1.3).
• Orders received during the period amounted to MSEK 128 (85) with an order book at the end of the period of MSEK 217

THE CEO’S VIEW, DANIEL HOPSTADIUS

Our strongest third quarter so far. W5 Solutions is expanding and shows stable turnover and profit growth for the third quarter. Our income amounted to MSEK 27.6 (24.8), an increase of 11%, and we more than doubled our profit, which ended at MSEK 1.9 (0.9). Summing up the first three quarters of the year, we have a 14% increase in sales to date of MSEK 101.3 (88.7). The third quarter tends to be our weakest historically, and 2022 is no exception, but it is followed by our strongest quarter. With the solid start to the year and the delivery plan for the fourth quarter, we have every chance of making 2022 go down in history as a great year in our growth journey.

Strong and increasing order intake
We continue to have a good order intake during the quarter, which totals MSEK 21. The order backlog at the end of the quarter amounted to MSEK 217. Having suffered component shortages and delivery delays throughout the year, we now see things starting to change for the better. With our order book and the improved component supply situation, we are looking forward to the end of 2022 and the beginning of 2023. Service and maintenance run smoothly and provide a sound basis for the ongoing order flow. We have several large offers out and expect order intake to go from good to very strong by the end of the year and during 2023.

New recruitment accelerates acquisition strategy and growth
To meet the growth we face, we continuously seek new skills and have strengthened the organization with several qualified employees. A strategically important recruitment Siebren de Boer, our Head of Corporate Development and M&A. Siebren has, among other things, experience as European CFO for NEP Group and has extensive knowledge of merger and acquisition processes. Acquisitions are a cornerstone of our strategy, so Siebren’s expertise and track-record will serve us well in our growth journey.

Enhanced preparedness for the expected change
We have high expectations for the end of this year and the beginning of the next. Our focus is to harness the continued strong demand for our solutions, which places heavy demands on our ability to deliver. The challenge here is to quickly adjust and redistribute the order flow, partly because of a slight ongoing shortage of components but also because of growing demand. In this regard, our teams have shown remarkable flexibility and patience in delivering under constantly changing conditions. During the fourth quarter, we will deliver orders for MSEK 70, which means that we all need to roll up our sleeves to ensure that our customers get what they expect. Whatever it takes to live up to our vision of a safer tomorrow.
 
We are also beginning to see our customers increase their budgets for 2023, which will entail larger purchases. As a result, we expect general growth in virtually all our business areas and subsidiaries, further improving our availability regarding service and maintenance moving forward. Considering the already strong order book and related business, 2023 looks to be an even stronger year. This lays the foundation for our long-term goals in 2025, a turnover of MSEK 500 with an EBITA margin of 15%.

Daniel Hopstadius

CEO, W5 Solutions AB

The interim report is available for download at https://w5solutions.com/investor-relations/