Sweco (SWEC) Q2 2024 earnings summary

Executive summary

• Net sales rose 11% year-over-year in Q2 2024 to SEK 8,077 million, with 6% organic growth and margin improving to 9.8% from 7.8%.

• EBITA increased to SEK 794 million, a 12% rise year-over-year, despite SEK 58 million in restructuring costs.

• Efficiency measures and restructuring, especially in the UK, are showing positive effects.

• Growth driven by higher average fees, increased billing ratio, and FTE growth; 6 of 8 business areas reported organic growth and EBITA improvements.

• Demand remains strong in water, energy, and infrastructure, but weak in traditional industry and real estate.

Financial highlights

• Net sales reached SEK 8,077 million, with 6% calendar-adjusted organic growth and 3% from M&A.

• EBITA was SEK 794 million, up 12% year-over-year (calendar adjusted), or 22% excluding SEK 58 million in restructuring costs.

• Net debt reduced to SEK 3,451 million, with net debt/EBITDA at 1.1x, reflecting a strong financial position.

• Cash flow from operating activities reached SEK 1,371 million, and available liquid assets totaled SEK 3,334 million.

• Six of eight business areas reported organic growth and EBITA improvements.

Outlook and guidance

• Efficiency improvements and higher billing ratios are expected to continue gradually improving margins.

• No major restructuring actions planned for Q3, but ongoing focus on efficiency.

• Order book continues to grow in absolute terms, with no directional change in trend.

• Committed to capturing growth opportunities in green transition, healthcare, pharma, and defense.

• Geopolitical instability and macroeconomic trends continue to impact certain markets, but overall demand is resilient.