Caverion Corporation's Interim Report for 1 January - 31 March 2022

Caverion Corporation Interim Report 28 April 2022 at 8.00 a.m. EEST

Caverion Corporation's Interim Report for 1 January - 31 March 2022

Improved order backlog realised in organic revenue growth

1 January - 31 March 2022
  • Order backlog: EUR 1,951.6 (1,626.7) million, up by 20.0 (-8.0) percent. Services backlog increased by 20.5 (0.7) percent. Projects backlog increased by 19.2 (-17.4) percent.
  • Revenue: EUR 528.1 (515.3) million, up by 2.5 percent, 2.6 percent in local currencies. Organic growth was 2.4 percent, driven by 4.4 percent organic growth in Services. Services business revenue increased by 4.3 percent, 4.4 percent in local currencies. Projects business revenue decreased by 1.0 percent, 0.7 percent in local currencies.
  • Adjusted EBITA: EUR 17.4 (16.4) million, or 3.3 (3.2) percent of revenue, up by 6.3 percent.
  • EBITA: EUR 15.0 (15.1) million, or 2.8 (2.9) percent of revenue.
  • Operating profit: EUR 11.4 (11.0) million, or 2.2 (2.1) percent of revenue.
  • Operating cash flow before financial and tax items: EUR 39.1 (40.6) million.
  • Cash conversion (LTM): 89.6 (137.4) percent.
  • Earnings per share, undiluted: EUR 0.04 (0.05) per share.
  • Net debt/EBITDA*: 1.0x (-0.5x).

Unless otherwise noted, the figures in brackets refer to the corresponding period in the previous year.

* Based on calculation principles confirmed with the lending parties, containing certain agreed adjustments. The calculation principles take into account the impacts of the IFRS 16 standard as of Q4/2021, while prior to this period IFRS 16 standard impacts were not applicable.

Guidance for 2022: In 2022, Caverion Group's revenue (2021: EUR 2,139.5 million) and adjusted EBITA (2021: EUR 87.7 million) will grow compared to 2021.


EUR million 1-3/2022 1-3/2021 Change 1-12/2021
Order backlog 1,951.6 1,626.7 20.0% 1,863.8
Revenue 528.1 515.3 2.5% 2,139.5
Organic growth, % 2.4 -5.4 -2.0
Adjusted EBITDA 30.8 29.4 4.7% 142.1
Adjusted EBITDA margin, % 5.8 5.7 6.6
EBITDA 28.5 28.1 1.3% 113.8
EBITDA margin, % 5.4 5.5 5.3
Adjusted EBITA 17.4 16.4 6.3% 87.7
Adjusted EBITA margin, % 3.3 3.2 4.1
EBITA 15.0 15.1 -0.7% 59.4
EBITA margin, % 2.8 2.9 2.8
Operating profit 11.4 11.0 3.4% 43.5
Operating profit margin, % 2.2 2.1 2.0
Result for the period 6.4 6.8 -6.4% 25.1
Earnings per share, 0.04 0.05 -7.1% 0.17
undiluted, EUR
Operating cash
flow before
financial and tax items 39.1 40.6 -3.7% 103.8
Cash conversion (LTM), % 89.6 137.4 91.2
Working capital -158.2 -176.0 10.1% -144.7
Interest-bearing net debt 125.6 98.0 28.1% 140.7
Net debt/EBITDA* 1.0 -0.5 1.1
Gearing, % 67.7 55.2 69.8
Equity ratio, % 17.3 17.2 19.0
Personnel, end of period 14,272 14,892 -4.2% 14,298

* Based on calculation principles confirmed with the lending parties, containing certain agreed adjustments. The calculation principles take into account the impacts of the IFRS 16 standard as of Q4/2021, while prior to this period IFRS 16 standard impacts were not applicable.

Jacob Götzsche, President and CEO:

"I am pleased that we continued improving our underlying business and increased revenue and adjusted EBITA during the first quarter of 2022. I am satisfied that despite the challenging business environment we had a strong order intake and a positive organic growth. We also refinanced our existing bond with a new EUR 75 million bond with extended maturity. All this supports our sustainable profitable growth strategy going forward.

The recent changes in the geopolitical environment are expected to impact also Caverion. We divested our Russian subsidiary in the end of 2021 and have no operations in Ukraine or Belarus. Therefore, the impact of the conflict on Caverion is currently indirect. The corona pandemic continued to impact our operations with people in isolation and due to very high sick leave levels compared to normal. Despite these challenges in the operating environment and resulting cost inflation, our performance during the first quarter of 2022 was solid.

Our order backlog increased by 20.0 percent to EUR 1,951.6 (1,626.7) million compared to a year earlier. The order backlog increased in Services by 20.5 percent and in Projects by 19.2 percent. We expect our increased order backlog to continue to support our revenue growth in 2022. Our first quarter revenue was EUR 528.1 (515.3) million, up by 2.5 percent or 2.6 percent in local currencies. Measured in local currencies, the Services business revenue increased by 4.4 percent, while the Projects business revenue decreased by 0.7 percent in the first quarter. The business mix change seen in recent years continued; the Services business accounted for 66.5 (65.4) percent of Group revenue in the first quarter.

Our first quarter adjusted EBITA improved to EUR 17.4 (16.4) million, or 3.3 (3.2) percent of revenue. EBITA was EUR 15.0 (15.1) million, or 2.8 (2.9) percent of revenue. Profitability improved especially in Sweden and Denmark. Both business units, Services and Projects, improved their performance slightly during the first quarter of 2022.

We have a solid financial position. Our liquidity position continues to be strong and our leverage is at a low level. Our operating cash flow before financial and tax items was EUR 39.1 (40.6) and cash conversion (LTM) was 89.6 (137.4) percent in the first quarter. In the first quarter 2022, the cash flow was negatively impacted by the payment of EUR 8.8 million for civil claims relating to the German anti-trust matter. The respective cost was recognised in 2021 and reported in items affecting comparability in 2021. At the end of the first quarter, our interest-bearing net debt amounted to EUR 125.6 (98.0) million, or EUR -11.6 (-27.4) million excluding lease liabilities. The net debt/EBITDA ratio was 1.0x (-0.5x) according to the confirmed calculation principles.

As part of our ongoing development of our capabilities to serve our customers, we signed the agreement to acquire the Danish company DI-Teknik A/S in March 2022 and closed one bolt-on acquisition in Sweden in January 2022. DI-Teknik is one of Denmark's largest industrial automation companies bringing us completely new expertise in this area. The acquisition was closed in April.

We have continued the work on our updated strategy that will guide us up until the year 2025. We will target sustainable profitable growth going forward. We strongly believe in our purpose to enable building performance and people's wellbeing in smart and sustainable built environment. We will tell more about this work at our Capital Markets Day in Helsinki on 10 May 2022."

Impacts of the Ukraine crisis on Caverion's business during the first quarter of 2022

Russia's invasion of Ukraine at the end of February 2022 increased geopolitical tensions especially in Europe overnight. Unprecedented sanctions were imposed on Russia and Belarus and on certain individuals of these countries, and Russia imposed extensive counter-sanctions. Any further escalation or prolongation of the conflict or regional unrest in neighbouring areas could adversely affect growth estimates for all of Europe, and potentially lead to a recession. The war has created uncertainties weakening the growth prospects in several countries where Caverion operates.

Caverion has divested its Russian subsidiary at the end of 2021 and has no operations in Ukraine or Belarus. Therefore, the impact of the conflict on Caverion is currently indirect. The crisis may affect Caverion directly short or longer term if the conflict escalates further or if de-escalation is not achieved. The possibility that other countries may become actively involved in the conflict would be likely to materially and adversely affect also Caverion's operations in such countries.

The duration of the Ukrainian conflict and its future effects on the industry, and Caverion in particular, remain uncertain, and the overall situation remains highly volatile. Caverion has already experienced some increases in material prices and delays in the supply chain, however not having a significant impact on the first quarter 2022 performance. These will potentially accelerate further with a longer duration of the war in Ukraine. Due to the uncertainty, it is however difficult to evaluate the potential long-term effects of the crisis on Caverion.

Market outlook for Caverion's services and solutions in 2022 and megatrends impacting the industry

Caverion expects the underlying demand to be overall positive in Services and Projects during 2022. This scenario assumes a sufficient control of the corona pandemic impacts with no significant unforeseen setbacks in 2022 and no further escalation or prolongation of the conflict in Ukraine. The conflict has resulted in geopolitical tensions and increased uncertainty in economic growth prospects. Inflationary and interest rate pressures are also rising.

New construction is expected to decrease slightly, with renovation remaining stable. Uncertainty is caused by the availability of building materials and the anticipation of cost increases. Increased material prices and longer delivery times may continue to affect also Caverion's business going forward. Potential risks may still emerge from the supply side, not only from raw material price inflation but also from labour shortage, potentially further fuelled by increased sick leave levels or quarantines caused by the corona pandemic.

The business volume and the amount of new order intake are important determinants of Caverion's performance in 2022. A negative scenario whereby the corona pandemic or the ongoing geopolitical conflict start to negatively impact market demand cannot be ruled out. However, a large part of Caverion's services is vital in keeping also critical services and infrastructure up-and-running at all times.

The monetary and fiscal policies currently in place are still supporting an economic recovery. As an example, the economic stimulus packages provided by national governments and the EU are expected to increase infrastructure, health care and different types of sustainable investments in Caverion's operating area over the next few years. The main themes in the EU stimulus packages are green growth and digitalisation. Caverion expects the national and EU programmes to increase demand also in Caverion's areas of operation in 2022. The European Central Bank (ECB) continued in March 2022 its step-by-step reduction of its asset purchases and may conclude the program in the third quarter of 2022. There are already expectations that ECB will follow FED with a lag and start to raise its interest rates later in the year to control inflationary pressures.

The digitalisation and sustainability megatrends are in many ways favourable to Caverion and believed to increase demand for Caverion's offerings going forward. The increased energy efficiency requirements, increasing digitalisation, automation and technology in built environment as well as urbanisation remain strong and are expected to promote demand for Caverion's services and solutions over the coming years. Especially the sustainability trend is expected to continue strong. The EU also aims to accelerate the green transition due to the current geopolitical situation.

Increasing awareness of sustainability is supported by both EU-driven regulations and national legislation setting higher targets and actions for energy efficiency and carbon-neutrality. This is furthermore supported by the society's end-users' general request for an environmentally friendly built environment. Examples of current initiatives include e.g. the proposed revision of EU's Energy Performance of Buildings Directive (EPBD) and Minimum Energy Performance Standards (MEPS) it aims to establish as well as the "Fit for 55" climate package and the Renovation Wave Strategy. The "Fit for 55" climate package proposes to make EU's climate, energy, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels. The objective of the European Commission's Renovation Wave Strategy is to at least double the annual energy renovation rate of residential and non-residential buildings by 2030. Mobilising forces at all levels towards these goals is expected to result in 35 million building units renovated by 2030.


Caverion expects the underlying demand to be overall positive during 2022. Caverion's Services business is overall by nature stable and resilient through business cycles. Stimulus packages are also expected to positively impact general demand in the Services business.

There is an increased interest for services supporting sustainability, such as energy management. Caverion has had a special focus for several years both in so-called Smart Technologies as well as in digital solutions development. These are believed to grow faster than more basic services on average and enable data-driven operations with recurring maintenance. The sustainability trend is also increasing the demand for building automation upgrades.

As technology in buildings increases, the need for new services and digital solutions is expected to increase. Customer focus on core operations also continues to open opportunities for Caverion through outsourcing of industrial operation and maintenance, property maintenance as well as facility management.


New construction is expected to slow down slightly in 2022, with office and commercial construction expected to slow down the most. Public construction remains unchanged, with the highest growth expectations in industrial construction. Industrial investment activity is expected to be stable. Due to the late-cyclical nature of the Projects business, even after the economic environment recovers, it typically takes some time before the Projects business turns back to growth. However, the stimulus packages are expected to positively impact the general demand also in the Projects business. Caverion expects the underlying demand to be overall positive also in Projects during 2022.

Economic sentiment is on a lower level in the EU as a result of the Ukraine crisis. However, the indicator is still above the long-term average with less impact on industry and construction confidence compared to consumer confidence.

From the trends perspective, the digitalisation and sustainability megatrends are supporting demand also in Projects, as Caverion's target is to offer long-term solutions binding both Projects and Services together. The requirements for increased energy efficiency, better indoor climate and tightening environmental legislation continue to drive demand over the coming years.


Caverion will hold a news conference on its Interim Report on Thursday, 28 April 2022, at 10.00 a.m. Finnish time (EEST) at Flik Studio Eliel, Töölönlahdenkatu 2C (Sanoma House), Helsinki, Finland. The news conference can be viewed live on Caverion's website at It is also possible to participate in the event through a conference call by calling the assigned number +44 333 3000804 at 9:55 a.m. (Finnish time, EEST) at the latest. The participant code for the conference call is 66423485#. More practical information on the news conference can be found on Caverion's website,

Financial information to be published in 2022

Interim/Half-yearly Reports for 2022 will be published on 4 August and 3 November 2022. Financial reports and other investor information are available on Caverion's website The materials may also be ordered by sending an e-mail to

Caverion will arrange a Capital Markets Day in Helsinki on 10 May 2022 at 12:00 noon (EEST). Further information on the programme is available on Caverion's website,


Distribution: Nasdaq Helsinki, principal media,

Source: Cision

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