05.08.2021 Stock exchange release

Caverion Corporation’s Half-year Financial Report for 1 January – 30 June 2021

Caverion Corporation’s Half-year Financial Report for 1 January – 30 June 2021

Significant profitability improvement in Q2

1 April – 30 June 2021

  • Revenue: EUR 545.1 (518.5) million, up by 5.1 percent, 2.6 percent in local currencies. Organic growth was
    3.3 percent. Services business revenue increased by 10.1 percent, 7.1 percent in local currencies.
  • Adjusted EBITDA: EUR 33.2 (18.5) million, or 6.1 (3.6) percent of revenue.
  • Adjusted EBITA: EUR 19.7 (4.8) million, or 3.6 (0.9) percent of revenue.
  • EBITA: EUR 18.0 (8.4) million, or 3.3 (1.6) percent of revenue.
  • Operating cash flow before financial and tax items: EUR -3.4 (48.2) million.
  • Earnings per share, undiluted: EUR 0.06 (0.01) per share.

1 January – 30 June 2021

  • Order backlog: EUR 1,789.0 (1,739.7) million, up by 2.8 percent. Services backlog increased by 10.7 percent.
  • Revenue: EUR 1,060.4 (1,060.1) million, down by 1.8 percent in local currencies. Organic growth was
    -1.1 percent. Services business revenue increased by 3.9 percent, 1.8 percent in local currencies.
  • Adjusted EBITDA: EUR 62.6 (44.7) million, or 5.9 (4.2) percent of revenue.
  • Adjusted EBITA: EUR 36.1 (17.0) million, or 3.4 (1.6) percent of revenue, up by 113.0 percent.
  • EBITA: EUR 33.1 (18.4) million, or 3.1 (1.7) percent of revenue.
  • Operating profit: EUR 24.9 (11.5) million, or 2.3 (1.1) percent of revenue.
  • Operating cash flow before financial and tax items: EUR 37.2 (104.3) million.
  • Earnings per share, undiluted: EUR 0.11 (0.02) per share.
  • Net debt/EBITDA*: 0.4x (0.1x).

Unless otherwise noted, the figures in brackets refer to the corresponding period in the previous year.


EUR million 4-6/21 4-6/20 Change 1-6/21 1-6/20 Change 1-12/20
Order backlog 1,789.0 1,739.7 2.8% 1,789.0 1,739.7 2.8% 1,609.1
Revenue 545.1 518.5 5.1% 1,060.4 1,060.1 0.0% 2,154.9
Adjusted EBITDA 33.2 18.5 79.6% 62.6 44.7 39.9% 116.5
Adjusted EBITDA margin, % 6.1 3.6 5.9 4.2 5.4
EBITDA 31.5 22.1 42.1% 59.6 46.2 28.8% 99.4
EBITDA margin, % 5.8 4.3 5.6 4.4 4.6
Adjusted EBITA 19.7 4.8 308.6% 36.1 17.0 113.0% 60.6
Adjusted EBITA margin, % 3.6 0.9 3.4 1.6 2.8
EBITA 18.0 8.4 114.5% 33.1 18.4 80.2% 42.4
EBITA margin, % 3.3 1.6 3.1 1.7 2.0
Operating profit 13.9 5.0 179.1% 24.9 11.5 117.1% 27.2
Operating profit margin, % 2.5 1.0 2.3 1.1 1.3
Result for the period 8.8 2.1 326.8% 15.6 3.7 325.5% 8.6
Earnings per share, undiluted, EUR 0.06 0.01 521.3% 0.11 0.02 526.7% 0.05
Operating cash flow before
financial and tax items -3.4 48.2 37.2 104.3 -64.3% 157.6
Cash conversion (LTM), % 80.3 160.7 158.5
Working capital -139.9 -161.3 13.3% -160.4
Interest-bearing net debt 147.3 138.8 6.1% 118.6
Net debt/EBITDA* 0.4 0.1 -0.2
Gearing, % 79.9 72.5 60.4
Equity ratio, % 18.1 18.6 18.9
Personnel, end of period 14,958 15,902 -5.9% 15,163
* Based on calculation principles confirmed with the lending parties.

Mats Paulsson, Interim President and CEO:

“I am satisfied with our performance improvement continuing strongly in the second quarter of 2021. A new highlight of the quarter was that our revenue grew clearly, driven by the strong organic growth in the Services business. The effects of the corona pandemic gradually started to ease off during the quarter. Having said that, we remain somewhat cautious with the pandemic as unpredictable virus variants and new waves of the pandemic may continue to emerge. Our profitability improved significantly compared to the previous year, helped by the revenue growth and our efficiency and productivity improvements completed earlier. Like in the first quarter, the profitability improvement came from both the Services and Projects sides of the business.

Our order backlog increased by 2.8 percent to EUR 1,789.0 (1,739.7) million compared to a year earlier and by 10.0 percent compared to the end of the first quarter (EUR 1,626.7 million). Order backlog continued to increase particularly in Services, up by 10.7 per cent. Our second quarter revenue grew to EUR 545.1 (518.5) million, up by 5.1 percent or 2.6 percent in local currencies. Measured in local currencies, the Services business revenue increased by 7.1 percent and the Projects business revenue declined by 4.6 percent in the second quarter. The Group’s organic growth was 3.3 percent in the second quarter. Organic growth in the Services business was as high as 8.0 percent. The business mix change seen in recent years continued; the Services business accounted for 65.1 (62.6) percent of Group revenue in the first half of 2021.

The performance improvement in the second quarter follows our plans. Our second quarter adjusted EBITA improved to EUR 19.7 (4.8) million, or 3.6 (0.9) percent of revenue. EBITA was EUR 18.0 (8.4) million, or 3.3 (1.6) percent of revenue. Both business units improved their profitability. I am particularly happy about the progress seen lately in divisions Industry, Germany, Norway and Sweden. In Services, the positive progress continued and the performance was on a strong level. We continued to see an increased interest towards those parts of our lifecycle offering that help customers make their operations more sustainable. In Projects, market demand still continued on a lower level, although there were clear signs of market stabilisation towards the end of the quarter. We have so far coped well with the increase in material prices, affecting particularly our Projects business. We continued to deploy best practices and to improve our business performance in Projects. The finalisation of the last remaining major risk project will most likely take until the end of the year.

Our operating cash flow before financial and tax items was EUR 37.2 (104.3) million in January-June 2021 and the cash conversion (LTM) was 80.3 (160.7) percent. A periodic change was according to our expectations. In the second quarter of 2020, operating cash flow was also positively impacted by postponed authority payments of EUR 29.6 million. Our liquidity position is strong and our leverage is at a low level. At the end of the second quarter, our interest-bearing net debt amounted to EUR 147.3 (138.8) million, or EUR 23.7 (9.9) million excluding lease liabilities. The net debt/EBITDA ratio was 0.4x (0.1x). Our cash and cash equivalents were EUR 113.7 (130.2) million. We completed bolt-on acquisitions in Sweden and Austria in July and continue to actively search for suitable acquisitions in the second half of 2021.

Looking forward into this year, we are well positioned to meet growing customer demand, supported by our new offerings. The economic environment is turning more positive and the sustainability trend is growing stronger around us. The improvement of energy efficiency of buildings will play a key role in the achievement of environmental targets such as EU’s “Fit for 55” climate package. We saw clear improvements in our performance in the first half of the year and I am confident in our ability to continue improving going forward. Our mid-term financial targets launched in November 2019 remain valid.


Market outlook for Caverion’s services and solutions

Caverion expects market demand to be overall positive in Services and to gradually improve also in Projects in the second half of 2021. This scenario assumes a successful outcome from the ongoing corona vaccination programmes and no significant unforeseen negative surprises in 2021. Increased material prices may still affect particularly the development of the Projects business.

The speed of the economic recovery is still somewhat uncertain. The business volume and the amount of new order intake are important determinants of Caverion’s performance in 2021. A negative scenario whereby the corona pandemic continues longer than currently anticipated, due to for example the so-called delta variant, can still not be ruled out. Nevertheless, a large part of Caverion’s services is vital in keeping also critical services and infrastructure up-and-running at all times.

The monetary and fiscal policies currently in place are clearly supporting an economic recovery in 2021. As an example, the economic stimulus packages provided by national governments and the EU are expected to increase infrastructure, health care and different types of sustainable investments in Caverion’s operating area. The main themes in the EU stimulus packages are green growth and digitalisation. Caverion expects the national and EU programmes to increase demand also in Caverion’s areas of operation as of the second half of 2021.

The digitalisation and sustainability megatrends are in many ways favourable to Caverion and believed to increase demand for Caverion’s offerings going forward. The increase of technology in built environments, increased energy efficiency requirements, increasing digitalisation and automation as well as urbanisation remain strong and are expected to promote demand for Caverion’s services and solutions over the coming years. Especially the sustainability trend is expected to continue strong. Increasing awareness of sustainability is supported by both EU-driven regulations and national legislation setting higher targets and actions for energy efficiency and carbon-neutrality. The objective of the European Commission’s Renovation Wave Strategy is to at least double the annual energy renovation rate of residential and non-residential buildings by 2030. Mobilising forces at all levels towards these goals are expected to result in 35 million building units renovated by 2030. The increased rate and depth of renovation will have to be maintained also post-2030 in order to reach EU-wide climate neutrality by 2050. Caverion has been putting a large effort to develop its offering and solutions to meet this demand.

On 14 July 2021, the European Commission adopted a set of proposals in the “Fit for 55” climate package to make EU's climate, energy, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels. Increasing the energy efficiency of buildings, the electrification of the transport infrastructure through e-charging stations, a greater use of renewable energy technologies as well as the green transition of the industry towards clean technologies all present major opportunities for Caverion.

The Energy Performance of Buildings Directive (EPBD) passed by the EU requires all new buildings from 2021 to be nearly zero-energy buildings (NZEB). Furthermore, EU Member States shall lay down requirements to ensure that, where technically and economically feasible, non-residential buildings with an effective rated output for heating systems or systems for combined space heating and ventilation of over 290 kW are equipped with building automation and control systems by 2025. The building automation and control systems shall be capable of (a) continuously monitoring, logging, analysing and allowing for adjusting energy use; (b) benchmarking the building’s energy efficiency, detecting losses in efficiency of technical building systems, and informing the person responsible for the facilities or technical building management about opportunities for energy efficiency improvement; and (c) allowing communication with connected technical building systems and other appliances inside the building.

The nearly zero or very low amount of energy required should be covered to a very significant extent from renewable sources. As concrete numeric thresholds or ranges are not defined in the EPBD, these requirements leave room for interpretation and thus allow EU Member States to define their nearly zero-energy buildings in a flexible way, taking into account their country-specific climate conditions, primary energy factors, ambition levels, calculation methodologies and building traditions. Several Caverion countries have already passed the national legislation based on the EPBD framework.


Caverion expects market demand to be overall positive in the second half of 2021. Caverion’s Services business is overall by nature more stable and resilient through business cycles than the Projects business. Stimulus packages are also expected to positively impact general demand in the Services business.

There is an increased interest for services supporting sustainability, such as energy management. Caverion has had a special focus for several years both in so-called Smart Technologies within building technologies as well as in digital solutions development, both of which are believed to grow faster than more basic services on average and enable data-driven operations with recurring maintenance. In Cooling, as an example, there is a technical change ongoing from environmentally harmful F-gases into CO2-based refrigeration, providing increased need for upgrades and modernisations. The sustainability trend is also increasing the demand for building automation upgrades.

As technology in buildings increases, the need for new services and digital solutions is expected to increase. Customer focus on core operations also continues to open up opportunities for Caverion through outsourcing of industrial operation and maintenance, property maintenance as well as facility management.


According to Euroconstruct reports published in June 2021, the recovery of the European construction industry is more rapid than initially expected. According to the latest estimates by Euroconstruct, the total construction volume in Western Europe is expected to grow by 4.1 percent in 2021, following a drop of 5.2 percent in 2020. Non-residential construction, which was most strongly hit by the crisis, still shows a weaker recovery path in 2021 compared to residential construction according to Euroconstruct. Due to the late-cyclical nature of the Projects business, even after the economic environment recovers, it typically takes some time before the Projects business turns back to growth. However, the stimulus packages are expected to positively impact the general demand also in the Projects business. Caverion expects market demand to gradually improve also in Projects in the second half of 2021.

From the trends perspective, the digitalisation and sustainability megatrends are supporting demand also in Projects, as Caverion’s target is to offer long-term solutions binding both Projects and Services together. The requirements for increased energy efficiency, better indoor climate and tightening environmental legislation continue to drive demand over the coming years.

Guidance for 2021

In 2021, Caverion Group’s adjusted EBITA (2020: EUR 60.6 million) will grow compared to 2020.


Caverion will hold an online news conference on its Half-year Financial Report on Thursday, 5 August 2021, at 10.00 a.m. Finnish time (EEST). The online news conference can be viewed live on Caverion’s website at www.caverion.com/investors. It is also possible to participate in the event through a conference call by calling the assigned number +44 (0)330 336 9105 at 9:55 a.m. (Finnish time, EEST) at the latest. The participant code for the conference call is “3813833 / Caverion”. More practical information on the online news conference can be found on Caverion's website, www.caverion.com/investors.

Financial information to be published in 2021

Q3 Interim Report will be published on 4 November 2021 and Financial Statement Release for 2021 on 10 February 2022 at 8:00 a.m. (EET). Financial reports and other investor information are available on Caverion's website www.caverion.com/investors. The materials may also be ordered by sending an e-mail to IR@caverion.com.


Distribution: Nasdaq Helsinki, principal media, www.caverion.com


Contact us or subscribe

For further information, please contact: Martti Ala-Härkönen, Chief Financial Officer, Caverion Corporation, tel. +358 40 737 6633, martti.ala-harkonen@caverion.com Milena Hæggström, Head of Investor Relations and External Communications, Caverion Corporation, tel. +358 40 5581 328, milena.haeggstrom@caverion.com
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