NCC (NCC) Q3 2024 earnings summary

Executive summary

• Orders received reached SEK 13.3 billion in Q3 2024, with a stable order backlog and book-to-bill ratio of 1.0, reflecting balanced intake and revenue.

• Operating profit increased 8% year-over-year, adjusted for capital gains, with industry and Building Nordics as key drivers.

• Net sales were SEK 14.3 billion, stable year-over-year.

• Market outlook remains positive, especially for infrastructure, public buildings, and defense, while the property market is slow but shows early signs of recovery as interest rates decline.

• The construction market is mixed, with strong demand in infrastructure and public buildings, but subdued property transactions and residential construction.

Financial highlights

• Q3 operating profit (EBIT) was SEK 665 million, up 8% year-over-year, excluding 2023 capital gains.

• Earnings per share (EPS) for Q3 was SEK 4.83, with a rolling twelve-month EPS of 12.72 SEK.

• Net debt increased to SEK -5,948 million at period end, mainly due to lower cash flow and continued investments.

• Cash flow before financing was SEK -309 million in Q3, mainly due to higher working capital.

• Financial net improved to SEK 53 million in the quarter, but higher net debt and interest rates impacted financing costs.

Outlook and guidance

• Continued positive outlook for infrastructure, industry, and public sector segments, supported by geopolitical and sustainability factors.

• Property market expected to improve gradually as interest rates decline, though a lag is anticipated before activity picks up.

• Environmental targets for CO2 reduction (Scope 1 and 2) have already surpassed the 2030 goal, with new targets to be set next year.

• Dividend policy remains at 60% payout, with 8 SEK per share for the year.