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Q3 Interim Report

Strong order intake, profit development, and reduced net debt

Christian Berner Tech Trade companies continue to show increased order intake, revenue, and improved results thanks to strong offerings at the heart of society’s challenges. EBITA increased in the third quarter by more than 26 percent, compared to the previous year, to SEK 21.9 million, and with SEK 53.8 million for the first nine months, an improvement of more than 53 percent.

Q3 2023
• Order intake totaled SEK 241.1 (181.3) million, an increase of 33.0 percent.
• Net sales for the second quarter were SEK 223.7 (199.2) million, an increase of 12.3 percent, with 11.3 percent constituting organic growth.
• EBITA was SEK 21.9 (17.3) million, an increase of 26.7 percent. The EBITA margin was 9.8 percent (8.7).
• Earnings per share before and after dilution were SEK 0.77 (0.64).
• Cash flow from operating activities was SEK 39.1 (19.5) million. Total cash flow for the period was SEK 27.2 (10.0) million.

Nine months in summary
• Order intake totaled SEK 763.7 (658.1) million, an increase of 16.0 percent.
• Net sales for the first quarter were SEK 707.9 (594.3) million, an increase of 19.1 percent, of which organic growth was 18.7 percent.
• EBITA totaled SEK 53.8 (35.1) million, an increase of 53.3 percent. The EBITA margin was 7.6 percent (5.9).
• Earnings per share before and after dilution were SEK 1.84 (1.20).
• Cash flow from operating activities was SEK 57.1 (3.8) million. Total cash flow for the period was SEK 22.3 (-35.0) million.

Significant events in the third quarter
• The Annual General Meeting (AGM) approved a dividend to shareholders to be paid in two instalments. The second payment was made during the quarter with SEK 5,6 million.
• The subsidiary Zander & Ingeström AB signed an agreement during the quarter for the delivery of electric boilers to Helen Ltd Hanasaari.
• The board of Christian Berner Tech Trade AB established a sustainability committee during the quarter.

Significant events after the end of the reporting period
• There were no significant events after the end of the reporting period.

Another strong quarter of growth and profitability improvements
Third quarter was record strong with an EBITA of SEK 22 million. Accumulated so far this year, the result is SEK 54 million, an improvement of 53 percent, compared to last year, and already 33 percent over the full year 2022. We have stabilized earnings with a larger business volume, which is also reflected in more consistent results over the year. Our business is diversified with a good spread across markets and customer groups, and a strong order intake is another sign of strength.

Several of the subsidiaries have delivered impressive results in the quarter. Zander & Ingeström not only delivered very strong results in the quarter but also won several good orders, including the previously announced order for three high-voltage electric boilers to be installed at Helen Ltd Hanasaari, Finland. The electric boilers will increase Hanasaari’s carbon-neutral district heat production. More and more people are replacing fossil fuel boilers with high-voltage electric boilers from Zander & Ingeström – that is beneficial for all of us.
Through in-house production, during Q3 Bullerbekämparen delivered most of the large order for noise-reducing customized control rooms it won last year, while at the same time replenishing its order books. A working environment free of noise is a matter of course for a responsible employer, and customers are increasingly asking for Bullerbekämparen’s solutions to achieve this. In fact, noise reduction is an important area for several of the Group’s companies. During the quarter, the Christian Berner companies in Norway, Sweden and Finland won fine orders for vibration and noise reduction materials for rail traffic. It is satisfying to see how Group companies can contribute to making rail transport even more sustainable by reducing its noise impact its surroundings.

We exceeded the Group’s margin target, reaching 9.8 percent EBITA for the quarter
The excellent business in combination with the dedicated work to increase decentralization and streamline operations continues to bear fruit. The group’s EBITA margin increased to 9.8 percent from 8.7 percent in the same period last year and finally above the Group target of at least 9 percent. So far this year, we are now at 7.6 percent compared to 5.9 percent in the same period last year. Sales in the quarter grew by 12 percent and order intake by as much as 33 percent, which means that we will continue to have a strong orderbook in the coming quarters.
We are humbled by the current business climate but, at the same time, we are still experiencing stable demand when viewing the Group as a whole. A large part of our offering addresses societal challenges; such as sustainable energy, clean water, and quiet environments. Thanks to determined efforts, we have an increasingly strong financial situation, which both provides security and makes it easier for us to take advantage of business opportunities that may arise in the future. We continue to strive for a more efficient, entrepreneurial organization that is a good owner for other fine businesses to add to the Group.

Caroline Reuterskiöld
President and CEO, Christian Berner Tech Trade AB