Financial position at the end of June 2020

Half-year Financial Report for 1 January –  30 June 2020 (published 6 August 2020)

Caverion’s liquidity position was strong and Caverion had a high amount of undrawn credit facilities on 30 June 2020. Caverion’s cash and cash equivalents amounted to EUR 130.2 (103.6) million at the end of June. In addition, Caverion had undrawn revolving credit facilities amounting to EUR 100.0 million and undrawn overdraft facilities amounting to EUR 19.0 million.

The Group’s gross interest-bearing loans and borrowings excluding lease liabilities amounted to EUR 140.1 (128.3) million at the end of June, and the average interest rate was 2.7 (2.9) percent. Approximately 36 percent of the loans have been raised from banks and other financial institutions and approximately 64 percent from capital markets. Lease liabilities amounted to EUR 128.9 (134.3) million at the end of June 2020, resulting to total gross interest-bearing liabilities of EUR 269.0 (262.6) million.

The Group’s interest-bearing net debt excluding lease liabilities amounted to EUR 9.9 (24.7) million at the end of June and including lease liabilities to EUR 138.8 (158.9) million. At the end of June, the Group’s gearing was 72.5 (77.3) percent and the equity ratio 18.6 (20.8) percent. Excluding the effect of IFRS 16, the gearing would have amounted to 5.2 (12.0) percent and the equity ratio to 21.2 (24.0) percent.

Caverion raised a 5-year TyEL pension loan of EUR 15 million on 29 April 2020.

On 15 May 2020 Caverion issued a EUR 35 million hybrid bond, an instrument subordinated to the company's other debt obligations and treated as equity in the IFRS financial statements. The hybrid bond does not confer to its holders the rights of a shareholder and does not dilute the holdings of the current shareholders. The coupon of the hybrid bond is 6.75 per cent per annum until 15 May 2023. The hybrid bond does not have a maturity date but the issuer is entitled to redeem the hybrid for the first time on 15 May 2023, and subsequently, on each coupon interest payment date. If the hybrid bond was not redeemed on 15 May 2023, the coupon will be changed to 3-month EURIBOR added with a Re-offer Spread (706.8 bps) and step-up of 500bps.

The outstanding EUR 66.06 million 2017 Capital Securities was redeemed in full on 16 June 2020 in accordance with its terms and conditions.

In June a one-year extension option to move the maturity of RCF (100M€) and term loan (50M€) from 2022 to February 2023 was utilised.

Caverion’s external loans are subject to a financial covenant based on the ratio of the Group’s net debt to EBITDA. The financial covenant shall not exceed 3.5:1. At the end of June, the Group’s Net debt to EBITDA was 0.1x according to the confirmed calculation principles. The confirmed calculation principles exclude the effects of the IFRS 16 standard and contain certain other adjustments.

 

Debt Maturity Structure Q2/2020


Net Debt Exl. Lease Liabilities Q2/2020

Gross Debt Exlcuding Liabilities Q2/2020

Cash flow and working capital

The Group’s operating cash flow before financial and tax items improved to EUR 104.3 (59.2) million in January-June and cash conversion (LTM) was 160.7 (169.9) percent. The Group’s free cash flow improved to EUR 91.0 (52.1) million. Cash flow after investments was EUR 85.7 (47.4) million.

In April-June, the Group’s operating cash flow before financial and tax items improved to EUR 48.2 (29.1) million. Cash flow was positively impacted by postponing authority payments to the value of EUR 29.6 million, which will be paid out in July-November. The Group’s free cash flow improved to EUR 45.0 (25.2) million. Cash flow after investments was EUR 43.1 (23.9) million.

The Group’s working capital improved to EUR -161.3 (-80.8) million at the end of June. There were improvements in divisions Finland, Sweden, Industry, Germany and Austria compared to the previous year. The amount of trade and POC receivables decreased to EUR 488.4 (502.2) million and other current receivables to EUR 24.0 (25.2) million. On the liabilities side, advances received increased to EUR 236.5 (196.5) million and other current liabilities to EUR 267.0 (234.5) million, while trade and POC payables decreased to EUR 189.3 (194.5) million.