Peab (PEAB) Q3 2024 earnings summary

Executive summary

• Q3 2024 saw net sales rise to SEK 15,539 million, with operating profit up to SEK 995 million and improved cash flow before financing, driven by strong civil engineering and paving demand, while housing and commercial office markets remained weak.

• Civil Engineering and Industry segments delivered strong growth and profitability, while Construction and Project Development faced continued weakness in the housing market.

• Order backlog reached SEK 47,026 million as of September 30, 2024, supported by robust public sector demand and infrastructure investments.

• The Group’s net debt decreased, with a net debt/equity ratio between 0.2 and 0.5.

Financial highlights

• Q3 2024 net sales: SEK 15,539 million (up 5% year-over-year); operating profit: SEK 995 million (up from SEK 786 million); operating margin: 6.4% (5.3%).

• Cash flow before financing for Q3: SEK 1,462 million (significantly higher than previous quarters); for nine months: SEK 882 million (–2,779).

• Orders received for nine months: SEK 44,458 million; order backlog: SEK 47,026 million.

• Earnings per share for Q3: SEK 2.59 (1.85); for nine months: SEK 3.62 (5.17).

• January–September 2024 net sales: SEK 41,912 million (down 3% year-over-year); operating profit: SEK 1,508 million (down from SEK 1,720 million); operating margin: 3.6% (4.0%).

Outlook and guidance

• Civil engineering and paving markets expected to remain strong, while housing investments are projected to stay at low levels in 2024, with gradual improvement in 2025–2026 as lower interest rates take effect.

• Public sector demand and infrastructure investments continue to support order intake.

• Total construction and civil engineering investments in the Nordic market are expected to remain stable.

• Diversified business model positions the group to benefit from varied market demand.