Clean air with Nederman solutions for industrial air filtration

Year-end report 2019

Quarter 4, 2019

  • Incoming orders amounted to SEK 1,140.7m (967.8), which currency adjusted is an increase of 18.1 percent compared with the same period last year.
  • Net sales amounted to SEK 1,086.5m (1,069.0), which currency adjusted is an increase of 1.8 percent compared with the same period last year.
  • Operating profit was SEK 108.7m (120.0)*, giving an operating margin of 10.0 percent 11.2)*.
  • Adjusted operating profit was SEK 113.2m (129.4)*, giving an adjusted operating margin of 10.4 percent (12.1)*.
  • Net profit was SEK 72.4m (89.4)*.
  • Earnings per share were SEK 2.06 kr (2.55).*

January – December, 2019

  • Incoming orders amounted to SEK 4,168.4m (3,479.5), which currency adjusted is an increase of 15.2 percent compared with the same period last year.
  • Net sales amounted to SEK 4,307.7m (3,553.9), which currency adjusted is an increase of 16.6 percent compared with the same period last year.
  • Operating profit was SEK 343.2m (305.7)*, giving an operating margin of 8.0 percent (8.6)*.
  • Adjusted operating profit was SEK 349.1m (318.9)*, giving an adjusted operating margin of 8.1 percent (9.0)*.
  • Net profit was SEK 225.8m (202.8)*.
  • Earnings per share were SEK 6.43 (5.78)*.
  • The Board of Directors proposes a dividend of SEK 2.50 (2.30) per share.

* In the transition to IFRS 16, the Group has applied a retroactive method, which means that the figures for the 2018 financial year have been restated in accordance with the new standard.

CEO’s comments

In recent years, Nederman has strengthened its position as the Clean Air Company, with an increased focus on the fantastic benefits that our products deliver and the major opportunities offered by global digitalisation. During the final quarter, this work materialised both in a strong level of orders received and in the acquisition of Finnish company Gasmet.

Acquisition of Gasmet
On 9 December, Nederman acquired the Finnish company Gasmet Technologies Oy. Gasmet is a world-leading supplier of FTIR gas analysis solutions and supplies system solutions for continuous emission monitoring, mercury and dioxin monitoring systems and portable gas analysers. The company is based in Helsinki, Finland, and also has global presence through wholly owned entities in Germany, the UK, Canada, Hong Kong and Austria. The company focuses on developing, manufacturing and marketing products and complete systems for a range of applications in industry, the environment and safety.

Gasmet’s EBITDA margin exceeds that of the Nederman Group, but taking acquisition costs into account, and the fact that the business was only consolidated for a brief period in the 2019 financial year, the acquisition had only a slightly positive impact on the Group’s net earnings.

Through this acquisition, we gain access to world-leading technology that significantly strengthens our offering in Monitoring & Control Technology and digital solutions. This moves us further in the direction of our vision of being able to offer Clean Air as a Service and strengthens our position as an industry leader in future-proof solutions for clean air.

I also want to take this opportunity to welcome Ketil Gorm Paulsen as the new head of the Monitoring & Control Technology division. Ketil was formerly Managing Director of NEO Monitors, where he has performed very well.

Orders received, sales and earnings
Nederman developed well in the fourth quarter of the year. Total orders received amounted to SEK 1,141m (968), equivalent to currency-neutral growth of 18.1 percent. Organic growth amounted to 11.4 percent. Net sales totalled SEK 1,087m (1,069), equivalent to currency-neutral growth of 1.8 percent. A relatively large share of the orders received arrived late in the quarter and it was thus not possible to convert them into sales before the end of the quarter, which meant that the result for the period was somewhat lower than anticipated. Adjusted operating profit was SEK 113m (129)*, yielding an adjusted operating margin of 10.4 percent (12.1)*. This should be seen from the perspective that the corresponding quarter of 2018 was Nederman’s most profitable quarter ever.

Orders received for the full year amounted to SEK 4,168m (3,480), equivalent to currency-neutral growth of 15.2 percent. Net sales totalled SEK 4,308m (3,554), equivalent to currency-neutral growth of 16.6 percent. Adjusted operating profit for the full year was SEK 349m (319)*, yielding an adjusted operating margin of 8.1 percent (9.0)*.

Outlook
Many of our markets, not least the US and China, and recently also Germany to a certain extent, continue to be characterised by uncertainty, not least from the recent development of the corona virus. Trade conflicts and financial uncertainty mean that decisions on major investments are being prolonged and that large projects are often being postponed, resulting in considerable volatility in orders received. We have also noted increasing signs of a general slowdown in the world economy. Despite these challenges, our basic view is one of cautious optimism. Environmental issues will remain important for our customers, which can be expected to soften the effects of a weaker economy to a certain degree, and we are continuing to strengthen our positions in several key areas where we see that future growth will occur. In Europe and North America, we will build on Nederman's strengths as a leading environmental technology company. In regard to the developments in Asia, which are not aligned with our ambitions, we are continuing our intensive efforts to reverse the trend.

Sven Kristensson, CEO

For further information, please contact:

Sven Kristensson, CEO
Telephone: +46 42 18 87 00
e-mail:
sven.kristensson@nederman.com

Matthew Cusick, CFO
Telephone: +46 42 18 87 00
e-mail:
matthew.cusick@nederman.com

This information is information that Nederman Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08:00 a.m. CET on February 14, 2020.

   
About Nederman
Nederman is a global leader in industrial air filtration dedicated to capturing, measuring, controlling and cleaning air to make industrial production more efficient, safe and sustainable. Based on industry leading products, solutions and services in combination with an innovative IoT platform we deliver knowledge and facts needed to optimise performance and guarantee emissions compliance.

The Nederman Group is listed on Nasdaq Stockholm. The Group has approximately 2600 employees and presence in more than 50 countries. Learn more at nedermangroup.com

Nederman Holding AB (publ), P.O. Box 602, SE-251 06 Helsingborg, Sweden. 
Corporate registration number: 556576-4205

The full report (PDF)