Interim Report Q3 2023

27 Oct 2023 08:00 CEST

"Focus on earnings growth and acquisitions to reach target."

Revenue, MSEK

580

(400)

Operating margin, %

10.7

(11.8)

EBITA, MSEK

(50)

EBITA margin, %

12.1

(12.5)

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Momentum Group’s interim report for the third quarter of 2023 was published on 27 October. Listen to the presentation below where Ulf Lilius and CFO Niklas Enmark presents the results and provide a business update. Below you’ll also find the separate Q&A session.

CEO comment, Q3 2023

Focus on earnings growth and acquisitions to reach target

As an acquirer without an exit horizon, we grow by continuously acquiring profitable and well-managed companies. Companies that we take good care of, with clear ambitions for earnings growth and activities to achieve these goals.

Ulf Lilius, President & CEO

The Group’s operations delivered favourable sales growth, with organic growth of 8% in the quarter. Acquired businesses contributed to this growth, and the Group’s revenue increased by a total of 45% year on year. Revenue growth, combined with effective cost control, led to a 40% increase in EBITA compared with the same quarter last year. Over the year to date, seven companies have been acquired, adding combined annual revenue of approximately SEK 510 million.

Third quarter 2023

Revenue increased by 45% to SEK 580 million (400), of which 8% was attributable to comparable units.
Operating profit rose by 32% to SEK 62 million (47), corresponding to an operating margin of 10.7% (11.8).
EBITA increased by 40% to SEK 70 million (50), corresponding to an EBITA margin of 12.1% (12.5).
Profit for the quarter increased by 22% to SEK 44 million (36), corresponding to earnings per share of SEK 0.85 (0.70).
Acquisition of Processkontroll Items, a leading niche player in instrumentation for demanding operating conditions.
Acquisition of Conclean, a leading niche player in private sewage systems, rainwater recycling and stormwater management.

January–September 2023

Revenue increased by 31% to SEK 1,631 million (1,245), of which 8% was attributable to comparable units.
Operating profit rose by 32% to SEK 176 million (133), corresponding to an operating margin of 10.8% (10.7).
EBITA increased by 32% to SEK 195 million (148), corresponding to an EBITA margin of 12.0% (11.9).
Profit for the period increased by 28% to SEK 129 million (101), corresponding to earnings per share of SEK 2.60 (1.95).
The return on working capital (EBITA/WC) was 60% (62).
The equity/assets ratio was 33% (44) at the end of the period.
As of 30 September, the number of repurchased Class B shares totalled 1,104,794. The change in the third quarter was attributable to business acquisitions.
During the first quarter, Hydmos Industriteknik, LocTech and Agera were acquired. During the second quarter, Askalon and Regal were acquired. During the third quarter, Processkontroll Items and Conclean were acquired. In total, the acquisitions generate approximately SEK 510 million in annual revenue.

Events after the end of the period

No significant events occurred after the end of the period.

A quarterly presentation is available on the company’s website, momentum.group, where CEO Ulf Lilius and CFO Niklas Enmark present the report and provide an update on operations.

About Momentum Group

Momentum Group operates, develops and acquires successful sustainable companies in the Nordic region through active ownership with decentralised profit and business responsibility. The Group consists of a number of companies that together constitute one of the Nordic region’s leading suppliers of industrial components, industrial services and other related services in the industrial sector. What the businesses have in common is that they help make customers’ operations easier, safer and more profitable by offering sustainable, long-life products and services with a strong local presence close to customers. The Group generates revenue of approximately SEK 2.1 billion and has more than 700 employees. Momentum Group's B share is listed on Nasdaq Stockholm. For more information, please visit momentum.group.

	Q3			Jan-Sep			R12 Sep
	2023	2022	Δ	2023	2022	Δ	2023	2022	Δ
Revenue	580	400	45%	1,631	1,245	31%	2,125	1,647	29%
Operating profit	62	47	32%	176	133	32%	228	171	33%
of which: Items affecting comparability	–	–		–	-6		–	-12
of which: Amortisation of intangible assets in connection with acquisitions	-8	-3		-19	-9		-23	-12
EBITA	70	50	40%	195	148	32%	251	195	29%
Net profit	44	36	22%	129	101	28%	168	129	30%
Earnings per share before and after dilution, SEK	0.85	0.70	21%	2.60	1.95	33%	3.35	2.50	34%
Operating margin	10.7%	11.8%		10.8%	10.7%		10.7%	10.4%
EBITA margin	12.1%	12.5%		12.0%	11.9%		11.8%	11.8%
Return on working capital (EBITA/WC)							60%	62%
Equity/assets ratio							33%	44%