This release is a summary of
October - December in brief
- Net sales decreased by 8.3% to
EUR 52.8 (57.6) million. In constant currency the net sales growth was -7%. - Organic net sales growth was -6% (5%).
-
Adjusted EBITA was
EUR 2.4 (5.3) million, or 4.6% (9.2%) of net sales. -
Operating profit decreased to
EUR 0.3 (3.8) million, or 0.6% (6.6%) of net sales. -
Sitowise acquired
Positive Impact Finland Oy in November and announced the acquisition of the expert business ofAhlman Group Oy in December.
January - December in brief
- Net sales increased by 3.2% to
EUR 210.9 (204.4) million. In constant currency the net sales growth was 5%. - Organic net sales growth was 1% (5%).
-
Adjusted EBITA was
EUR 17.0 (20.4) million, or 8.1% (10.0%) of net sales. -
Operating profit declined to
EUR 11.7 (13.2) million, or 5.5% (6.4%) of net sales. -
The order book decreased by 10% to
EUR 164 (181) million. - Leverage (net debt / adjusted EBITDA) was 3.0x (2.6x).
-
In addition to the acquisitions announced in Q4, Sitowise acquired the Finnish company
Infrasuunnittelu Oy in May. - Sitowise published its new strategy for 2023-2025 in February with unchanged long-term financial targets.
- Considering the current market environment, and to preserve capital for future growth initiatives, the Board of Directors proposes that no dividend be paid based on the balance sheet to be adopted for the financial year 2023. The Board will consider using the authorization for share buy-backs during 2024.
The figures in the financial statements release are audited. Comparative figures for the corresponding period of the previous year are in brackets. The figures disclosed in the financial statements release are rounded so the sum of individual figures can deviate from the reported sum. This report has been published in Finnish and English. If there are any differences between the English translation and the original Finnish version, the Finnish report shall prevail.
EUR million | 10-12 2023 | 10-12 2022 | Change, % | 1-12 2023 | 1-12 2022 | Change, % |
Net sales | 52.8 | 57.6 | -8.3 % | 210.9 | 204.4 | 3.2 % |
EBITA, adjusted | 2.4 | 5.3 | -54.6 % | 17.0 | 20.4 | -16.5 % |
% of net sales | 4.6 % | 9.2 % | 8.1 % | 10.0 % | ||
EBITA | 1.3 | 4.7 | -73.5 % | 15.1 | 16.1 | -5.9 % |
Operating profit | 0.3 | 3.8 | -91.1 % | 11.7 | 13.2 | -11.1 % |
Result for the period | -0.9 | 2.4 | -135.7 % | 5.5 | 7.9 | -29.9 % |
Cash flow from operating activities before financial items and taxes | 11.3 | 13.1 | -13.4 % | 23.9 | 22.7 | 5.4 % |
Net debt | 55.3 | 56.6 | -2.2 % | |||
Net debt / EBITDA, adjusted | 3.0x | 2.6x | 16.6 % | |||
Equity ratio, % | 42.9 % | 41.6 % | ||||
Earnings per share (EPS), EUR | -0.02 | 0.07 | -133.0 % | 0.16 | 0.22 | -28.4 % |
Number of personnel, average | 2,169 | 2,237 | -3.0 % | 2,211 | 2,151 | 2.8 % |
CEO
In Q4, Sitowise's Infra and Digital Solutions businesses continued their strong performance and
In the quarter, we completed a significant investment into modernizing our system landscape. While bringing long-term benefits, during the quarter, the implementation of the new ERP and CRM systems in
Even with the headwinds in the Buildings business, our full-year net sales increased by 3.2 percent in 2023 and adjusted EBITA margin was 8.1 percent. Infra outpaced the market growth throughout the year, reaching its targets each quarter. Also Digital Solutions had an excellent year with significant performance improvement and successful streamlining of its SaaS and product portfolio. Both businesses benefited from the growing demand in green transition and security related services.
I truly believe that Sitowise is today better positioned to meet our clients' needs and face the competition than a year ago. One of the 2023 key events was the launch of our revised strategy, that has been well received by our employees and external stakeholders. I'm pleased of the progress made in strategy execution in 2023 and in targets of increasing the share of recurring revenue to 10% in 2025 and doubling our sustainability services revenue to
Sitowise employees showed a strong commitment in providing our services and developing new designs and solutions for our clients last year, even if we needed to make some tough decisions, especially in Buildings, during the year. I want to express my warmest thanks to all Sitowise employees for their continued dedication and good work.
We expect the market environment to remain mixed in 2024. Demand for services related to green transition, security and digitalization of the built environment is expected to remain as the key driver for growth especially in Infra and Digital Solutions. In Buildings, the first part of the year will still be challenging, and the market is expected to show signs of recovery towards the end of 2024 at the earliest. There are already some weak positive signals when it comes to the Swedish market environment, but predicting the timing of a clear improvement in our markets is very difficult.
Our priority in 2024 is to improve Sitowise's profitability. Key actions in all business areas include moving our sales culture to the next level, pricing excellence, directing our efforts to the growing segments in the market, further actions to mitigate cost inflation and increasing internal efficiencies.
OUTLOOK, GUIDANCE, AND FINANCIAL TARGETS
Outlook for the year 2024
The stable long-term growth in the demand for design, consulting and digital services to create sustainable societies is supported by megatrends such as urbanization, renovation backlog, sustainability, digitalization and security.
The weakened macro-economic outlook, high interest rates and high inflation have slowed down growth in both
We expect the market environment to remain mixed in 2024. Key driver for growth will be increasing demand for services related to green transition, security, and digitalization of the built environment. In Buildings, the first part of the year will still be challenging due to the difficult construction market in
Entering the year 2024, orderbooks were at good level in Infra, Digital Solutions and
In addition to the market development, cost inflation (e.g., relating to salary increases), higher number of working days in 2024 than in the previous year (-1 day in Q1, +1 day in both Q2 and Q3 and equal number of days in Q4), potential currency fluctuations (EUR/SEK) and higher interest expenses are expected to impact Sitowise's financial performance during 2024.
Guidance
Long-term financial targets
The Board of Directors of
- Growth: Annual growth in net sales of more than 10 percent, including acquisitions
- Profitability: Adjusted EBITA margin of at least 12 percent
- Leverage: Net debt / adjusted EBITDA should not exceed 2.5x, except temporarily in conjunction with acquisitions
According to its dividend policy, Sitowise's objective is to pay annually a dividend corresponding to 30-50 percent of net profit to its shareholders. When distributing a possible dividend, business acquisitions, the company's financial situation, cash flow and future growth opportunities are taken into account.
SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
Directed share issue and a change in the number of Sitowise shares
On
The new shares subscribed for in the issue were registered with the
Proposals of the Shareholders' Nomination
On
The Shareholders' Nomination Board further proposes that for the term of office ending at the Annual General Meeting 2025, the current members of the company's Board of Directors
Proposals in full are available on Sitowise's investor site at Annual General Meeting 2024 | Sitowise.
BOARD OF DIRECTORS' PROPOSAL CONCERNING THE USE OF THE PARENT COMPANY'S PROFIT
On
According to its dividend policy, Sitowise's objective is to pay annually a dividend corresponding to 30-50 percent of net profit to its shareholders. When distributing a possible dividend, business acquisitions, the company's financial situation, cash flow and future growth opportunities are taken into account. Considering the current market environment, and to preserve capital for future growth initiatives, the Board of Directors proposes that no dividend be paid based on the balance sheet to be adopted for the financial year 2023. The Board will consider using the authorization for share buy-backs during 2024.
Espoo,
Board of Directors
Additional information
Heikki Haasmaa, CEO, heikki.haasmaa@sitowise.com, tel. +358 50 304 7765
Financial calendar 2024
The planned publication dates for
- Annual and Sustainability Report, and the Report of
the Board of Directors and Financial Statements 2023: week 11 2024 -
Interim Report for January-
March 2024: 8 May 2024 -
Half-year financial report for January-
June 2024: 13 August 2024 -
Interim Report for January-
September 2024: 7 November 2024
Webcast for analysts, media and investors
Sitowise's Q4 2023 earnings webcast will be held today,
Distribution:
Key media
www.sitowise.com
SITOWISE IN BRIEF:
Sitowise is a Nordic expert in the built environment with strong focus on digitality. We provide design and consulting knowhow to enable more sustainable and smarter urban development as well as smooth transportation. Sitowise offers services related to real estate and buildings, infrastructure, and digital solutions both in
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