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Cavotec SA - Interim report January - September 2021
Growing order book and revenue in New Cavotec
On 5 March 2021, Cavotec communicated a decision to focus resources and make investments in the ports & maritime and industrial markets. As a consequence, a process was initiated to divest the Airports business. From the first quarter 2021, Cavotec reports the groups ports & maritime and industry businesses combined under the name New Cavotec. Airports is reported separately.
JULY–SEPTEMBER 2021 NEW CAVOTEC
- Order backlog increased 20.0% compared to Q221 to EUR 92.8 million
- Revenues increased 3.1% to EUR 29.2 million (28.3)
- EBIT amounted to EUR 1.2 million (1.9), corresponding to a margin of 4.0% (6.6%)
- EBIT adjusted for growth investments amounted to EUR 2.5 million corresponding to a margin of 8.5%
JULY–SEPTEMBER 2021 TOTAL
- Order backlog increased 13.3% compared to Q221 to EUR 120.0 million
- Revenues decreased -1.7% to EUR 36.9 million (37.5)
- EBIT decreased to EUR -2.1 million (0.7), corresponding to a margin of -5.8% (2.0%)
JANUARY–SEPTEMBER 2021 NEW CAVOTEC
- Order backlog of EUR 92.8 million increased 60.7% compared to FY2020
- Revenues decreased -1.4% to EUR 84.4 million (85.5)
- EBIT remained stable to EUR 4.5 million (4.5), corresponding to a margin of 5.3% (5.3%)
- EBIT adjusted for growth investments amounted to EUR 6.4 million corresponding to a margin of 7.5%
JANUARY–SEPTEMBER 2021 TOTAL
- Revenues decreased -6.3% to EUR 110.7 million (118.2)
- EBIT decreased to EUR -2.5 million (4.4), corresponding to a margin of -2.2% (3.7%). The loss is predominantly driven by the performance of the airports segment in a disrupted travel market
- Net debt amounted to EUR 23.8 million (Q221:19.4)
Comment from the CEO
Growing interest in decarbonisation underpins strong development in New Cavotec
We continue to see a strong demand for Cavotec’s cleantech solutions to facilitate the decarbonization of the maritime industry. In the third quarter, we signed contracts worth EUR 6.5M for our prefabricated PowerFit shore power connection modules that will be retrofitted to a number of vessels for two of the world’s largest container shipping lines. The order is a recognition of our leading position in the market for retrofitting the thousands of ships that need to be made shore power ready in the coming years. We also signed several orders for shore power connection systems for new-build vessels in recognition of our wide offering in this space.
The fact that shipping lines chose to install our equipment in anticipation of ports around the world to do the same is very encouraging, as well as our dominating market position in this market. The orders send strong signals to ports around the world that their biggest customers plan for a reality in which charging in port will be the new normal.
During the quarter we also secured orders with Port of Stockholm for the first MoorMaster system in Sweden which is estimated to reduce CO2 emissions by up to 5,000 tonnes per year. In fact, a new study by Starcrest Consulting Group shows that automated mooring can reduce carbon emissions in a typical cargo port by tens of thousands of tonnes. If installed at every container port worldwide the carbon dioxide savings alone would be equals to the emissions from a million cars. To help ports make the right decisions we have release a free tool that can be used to estimate the potential fuel savings and emissions reductions from adopting automated vacuum mooring.
The above and other orders resulted in a 20% increase in the backlog for New Cavotec ending at EUR 92.8 M, almost 60% higher than a year ago.
The majority of revenue from these maritime orders will not materialize until 2022 and onwards since the planning cycle in the industry is long. It is against this background encouraging that revenues in New Cavotec, despite the long sales and delivery cycles, increased 3.1% to EUR 29.2 million in the quarter. Strong revenue in Industry and Services contributed to the increase.
Our accelerated focus on investing in activities to solidify our market leading position continued during the quarter. Our focus is on developing our cleantech systems further as well as recruitment of sales and marketing people. Furthermore, we opened a new office in Malaysia to leverage our strong position in the fast-growing markets for electrification and automation of ports in Asia.
In total the growth investments during the third quarter amounted to EUR 1.3 million. These investments have a short term impact on our profitability, but EBIT adjusted for those growth investments amounted to EUR 2.5 million corresponding to a margin of 8.5%.
The process of divesting the Airports business continues according to plan. The market conditions for the airports industry are demanding. However, going forward, demand for both new build and service is expected to increase, due to expected increase of traveling after the pandemic.
The global focus on sustainability, work place safety and increased efficiency in our markets is only accelerating and we continue to solidify our leading position. The growing demand is a strong sign of our expectations for the future of Cavotec.
Lugano, 29 October 2021
Chief Executive Officer
Conference call in connection with publication of the quarterly report
A conference call for shareholders, analysts and media will be held on 29 October 2021 at 10:00 CEST. Participating on the conference call from Cavotec will be Mikael Norin, CEO, and Glenn Withers, CFO.
Conference call Dial-in numbers:
SE: + 46850558352
UK: + 443333009264
US: + 16319131422
Analysts & Media
Johan Hähnel – Investor Relations Manager
Mobile: +46 70 605 63 34 – Email: firstname.lastname@example.org
This is information that Cavotec SA is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 07:00 CEST on 29 October 2021.