Cavotec SA - Interim report January - December 2019 - Seite 2

Revenues for the fourth quarter and for the whole year 2019 were in line with previous year. This is a reflection of fewer big projects in some of our markets during 2019 but it also shows that we are becoming increasingly better at delivering stable financial performance without the boost from any extraordinary contract. This trend is supported by our Services offering, which has developed very well since the launch and now represents 20% of our total revenues.

Revenues within Ports & Maritime increased again in the fourth quarter, mainly as a result of higher sales in the Shorepower, MoorMaster and Reels product categories and the growing service offering within the segment. Revenues within Airports & Industry decreased due to a lack of bigger projects and lower activity among industrial companies and our continued focus on high quality orders. We are, however, optimistic for 2020 as we expect high activity in Airports with projects in India and the Middle East and to acquire new Industry customers in previously underserved geographies. 

In 2019 we reported not only significantly improved profitability but also the highest cash generation since Cavotec was listed 2011 in Stockholm – even after the extraordinary payment of EUR 8.1 million in June 2019. One reason for this improvement is our focus on high quality, lower risk business combined with the lower cost base resulting from the transformation. The adjusted EBIT increased to EUR 5.6 million (0.1), corresponding to a margin of 11.8% (0.2%) and for the whole year to EUR 15.7 million (3.9), corresponding to a margin of 8.0% (2.0%). The operating cash flow amounted to EUR 9.1 million (1.8) in the fourth quarter and to EUR 14.4 million (1.2) for the whole year. This all together led to that the net debt decreased to EUR 3.9 million, which combined with continued good cash generation provides us with ample room to further develop our business organically and to start contemplating strategic acquisitions.  

Our order book at the end of the quarter is stable relative to a year ago at EUR 100.0 million on the back of a lower year over year order intake. We don’t expect the lower order intake in the quarter to have an impact on our growth ambitions for 2020 as variations from one quarter to another is common for us. 

Our strong financial performance in the quarter and the year means that we have met and exceeded our 7% annual EBIT margin target earlier than expected. We have therefore today announced a new accelerated financial target; we are now aiming to reach an annual adjusted EBIT margin of more than 10% within two years and more than 12% within five years. The remaining targets are unchanged.