Financial Report 1 April 2021–31 March 2022
Fourth quarter (1 January–31 March 2022)
- Revenue rose by 8 percent to MSEK 1,205 (1,115).
- EBITA increased by 21 percent to MSEK 88 (73) and the EBITA margin improved to 7.3 percent (6.5).
- Net profit rose by 23 percent to MSEK 53 (43).
12 months (1 April 2021–31 March 2022)
- Revenue rose by 6 percent to MSEK 4,575 (4,311).
- EBITA increased by 22 percent to MSEK 331 (271) and the EBITA margin improved to 7.2 percent (6.3).
- Net profit rose by 22 percent to MSEK 202 (166).
- Earnings per share for the most recent 12-month period increased to SEK 7.55 (6.15) before dilution and SEK 7.50 (6.15) after dilution.
- Six acquisitions (Abtech, Albretsen, (3) Screen, Safety Technology, BSafe and Retco) have been completed, one of which after the end of the period, with total annual revenue of approximately MSEK 170.
- The Board proposes a dividend of SEK 3.40 per share (3.00).
The past year – Platform for continued profitable growth
The Group’s positive performance continued during the 2021/2022 financial year. Profit increased by 22 percent, the operating margin improved to 7.2 percent, and we delivered our highest-ever annual earnings. It is gratifying to note that all three of our divisions increased their revenue, earnings, and operating margins during the year and that the last quarter of the year ended on a strong note, with increased profit (21 percent) and a stronger operating margin (0.8 percentage points).
But the year has not been without its challenges, including interruptions in the supply chain, the COVID-19 pandemic, and increased costs for shipping, materials, and production. However, our decentralised governance model, in which our subsidiaries are responsible for the majority of decision making, demonstrated its strength by providing the companies with the flexibility to find their own solutions to the challenges that arose. Russia’s invasion of Ukraine has so far had only a marginal impact on the Group. We have partnered with the Ukrainian embassy to donate relevant products from several of our companies, valued at approximately MSEK 10.
Overall, we have seen many examples where our managers and leaders have taken responsibility and proactive measures during the year.
We have established a plan to double the Group’s operating profit in the next four to five years. The plan includes clearer decentralisation, an increased focus on profitability, intensified management by objectives and an increased rate of acquisitions. We have deliberately chosen to prioritise earnings growth over revenue growth, which has resulted in increased margins. The preceding year included major non-recurring transactions stemming from the pandemic, which strengthened revenue. The year was a step in the right direction and we have increased our focus on transactions where we offer higher added value and assigned a lower priority to lower-margin transactions.
Thanks to an increased rate of acquisitions, we welcomed five new companies to the Group during the year, and one more after the end of the operating year. Four of them are add-on acquisitions for the companies deemed to have favourable conditions for growth. Two acquisitions are new independent companies that match our updated acquisition criteria, with a focus on well-run, highly profitable companies that are market leaders in expansive niches areas for construction and industrial customers.
The future – Focus on improving earnings and profitability
Our earnings have increased for nine consecutive quarters. After my first year with the Group, I see favourable conditions to improve profitability, earnings, operating margins, and cash flows in all divisions going forward.
Our corporate culture is characterised by entrepreneurship, where dedicated leaders grow as they continuously develop and improve their companies. Overall, I feel confident as I look ahead to the coming years. We will continue to build a group of niche companies that create long-term commercial and social value. We are convinced that adopting a sustainability perspective is a prerequisite for creating growth opportunities and being viewed as attractive in the stock market and M&A market, among both customers and employees. That is why sustainability, which creates business benefits, is a cornerstone of the future of Bergman & Beving.
We live in times of growing inflation and uncertainty about where the economy is heading. The strength of our decentralised model is that it provides us with the preconditions to react quickly, on a company by company basis, if the market conditions change. Assuming that the underlying situation does not dramatically worsen and with our existing companies and increased rate of acquisition, increased profitability and improved cash flow, I believe that we have good potential to double the Group’s operating profit within four to five years.
I would like to conclude by offering my sincere thanks to all our dedicated employees for your many outstanding efforts during the year and welcome our new employees to Bergman & Beving.
Stockholm, May 2022
President & CEO