Bravida Holding AB

STO:BRAV

Earnings Call Transcript 2018-Q4

[Operator]

Ladies and gentlemen, welcome to the Bravida Q4 Report 2018. Today, I'm pleased to present CEO, Mattias Johansson; and CFO, Nils-Johan Andersson. [Operator Instructions] Now I hand the word over to Mattias. Please go ahead.

[Mattias Johansson, CEO & Group President]

Thank you very much, and good morning, everyone, and welcome to this presentation of Bravida's Q4 results. Today, as usual, it's myself, Mattias Johansson; and Bravida CFO, Nils-Johan Andersson, who will do the presentation and answer your questions.So let's start on Slide 3. Bravida is, as you know, a growing company and has a growing business. We are now located in more than 160 different places in 4 countries. We have more than 55,000 customers, and we are not dependent on any specific market or customer. Close to 50% of our sales is service, and more than 60% of our sales is coming from service, renovation and redevelopment. This gives us a low risk in our business model. First, we have diversified end markets; two, low customer concentration; and three, small average contract size.And I think this is another solid and good quarter. So let's look at the highlights on the next slide, Slide 4. And the key highlights for Q4 2018 is that the net sales grew 12% to SEK 5,521,000,000, and the organic growth was 4% and M&A contributed with 6%. We had growth in all countries, and the service sales growth was 4%, and the installation sales was high at 20%. The slower service growth is dependent on fewer working days in December, in the end of the quarter. The order backlog is at good level, close to SEK 12 billion. We have continued good momentum in order intake, and the order intake is SEK 6.6 billion, whereof Stockholm Bypass Project is included with SEK 1.6 billion. We have good order intake in Sweden and Finland, and we have growth in Sweden even if we exclude Stockholm Bypass Project.EBITA is up 12% to SEK 438 million, and the margin is at stable 7.9%. And I'm very happy to see and announce that the EBITA margin improved in Denmark and Finland. The EBITA margin in Norway and Sweden with a slightly lower level this quarter, we're coming back to that later on. But we can already now say that the low margin in Norway is due to high production in remaining low-margin project in Oras.We had a very strong cash flow, I would say. It was SEK 807 million from operating activities, and the cash conversion is above 100% at 102%. The working capital is minus SEK 940 million or minus 4.9% of sales. And net debt is down to SEK 1.365 billion, and that's 1.1x adjusted EBITDA. The strong cash flow enables increased dividend to 29%, and we can continue to do acquisitions and take down the leverage even if we do this increase. And that's a strong evidence that our business model is cash-generating, and we can do other things to develop the company at the same time.In the quarter, we did 4 acquisitions that were completed, adding SEK 420 million. And so far, we have done 3 acquisitions in Q1 '19, adding another SEK 105 million. The Oras integration is according to plan, and we also have strengthened the acquisition team to ensure a continued high pace of acquisitions.On the next slide, we'll take you through the view on the market. Overall, we still see a high demand for both service and installation. We have heard earlier this month that the construction companies in the Nordics say the same. They have also increased their order backlog since last year. And in Sweden, we see good market. Service and installation activity is good. The main growth drivers are public investments in buildings and infrastructure. The industry confidence indicator is at normal level, and we also see the declining production in residential construction will be replaced by projects from other types of facilities. For example, renovation of residentials there. In Norway, the market is good as well. Public investments and energy efficiency is driving that market. Overall, service and installation activity is good. And we also can see decreasing activity in residential construction. But overall, our market, the market we are exposed to, we certainly see a good demand for the service and installation we are delivering.In Denmark, the market is good. Construction of residential is actually growing. Health care and education buildings are driving volumes, and construction volumes of commercial buildings increases as well as data centers.In Finland, the market is stable. The construction market is improving. We can see that the sales have increased for construction companies, and we also see stable demand for service and installation in our market. The industry confidence indicator for all countries, I would say, is at normal level.On Slide 6, we take a deeper look into how sales have developed in Q4. We had growth of 12%, as I mentioned earlier; 4% was organic and 6% came from M&A. If we split up the Q4, regarding the organic growth, we could see that we had a good growth in October and November and a lower growth in December, depending on fewer working days that I mentioned earlier. If we look into how this year has started, we are back on good growth again. So overall, Q4 was a good quarter when we look at the growth side. We also can see that we had growth in all countries, and we have especially strong growth in installation. The EBITA is improved by 12% in the quarter to SEK 438 million, and the margin is unchanged at 7.9%. And the EBITA margin improvement in Denmark and Finland is something we are really happy about. But of course, we still see a gap between the average in the group and the market we have in those countries, and we think we can improve that in the normal course. It was slightly lower in Sweden and Norway, but still at very good levels, I would say. All in all, 12% growth regarding sales and 12% growth regarding the EBITA.On the next slide, we look at the order backlog. I'm concerned that the backlog is at levels that we are very confident about. And it's a record high level, of course, when we booked one part of the Stockholm Bypass Project. It's now close to SEK 12 billion. It's 17% higher compared to last year. We have increased order backlog in all divisions in Sweden, even if we exclude Stockholm Bypass Project, and I think it's a good proof of the demand we see in the market. We have a declining order backlog in Norway, mostly depending on Oras, where we still produce on the order backlog. They came into our books with -- on low margin as well. That's why they dilute our margin. And we have been taking down that order backlog since 2 years back. And we see that this part of the Oras order backlog will end out in Q1 '19. Otherwise, if we exclude the Stockholm Bypass Project, we have won mainly small and mid-sized projects. We will also book the second phase of the order -- the Stockholm Bypass Project in Q1 '19, and we will add around SEK 1.1 billion regarding this project.Turning to acquisition on Slide 8. And as you all know in this call, acquisition is an important value create in Bravida. We know that there are many possibilities in the market to continue to do this. We have, therefore, strengthened our M&A team to enable more deals and improve integrations. So far in the quarter, we did 4 acquisitions, 3 in Sweden and 1 in Finland. In total, we did 12 acquisitions in '18, adding around SEK 800 million, and we did acquisitions in all the countries. So far, in '19, we have done another 3 acquisitions, adding around SEK 100 million in sales. For the coming quarters, we still see a strong pipeline, so attractive multiples, and I'm convinced that M&A will contribute to Bravida's development in 2019 as well.So said that, now over to Nils-Johan and the financial performance.

[Nils-Johan Andersson]

Thank you, Mattias. And yes, let's start to begin to the figures. As Mattias said earlier, we had a top line growth of 12%, and this is the same figure for the quarter and for the full year. And this is actually in line with the financial target we have. If we look into the organic growth of 4%, it was negative affected from a long Christmas vacation. We lost days in December. We had good organic growth in October, November, a weakened December, but I think Mattias also mentioned this, that we are back on track again in January. EBITA increased with 12%, and earnings per share increased with 17%. So we see a positive impact from lower tax rates. We have used loss carryforward mainly in Norway during '18, and we also have positive tariffs effect in the financial net debt that make that the earnings per share is increasing faster than the EBITA level. You can say, overall, there is a good financial performance in Q4.And let's look into next slide and start to look into different countries, and starting with the largest one, Sweden. We see a stable top line growth, with 5% in the quarter, and this is mainly organic growth. EBITA margin came down slightly from 8.7% to 8.5%. This is mainly explained by -- that we had a positive one-off last year, where we had repayment from pension companies. The amount was SEK 10 million to SEK 15 million. So -- but anyhow, it's still good development in Sweden if you look for the margin-wise. If you look for the order intake and order backlog, overall, it was really good. Order intake was up 91%. And of course, the main explanation is the first bypass Stockholm order. But I figure it's even more important is to look into, if we exclude this one, the order intake was up with 27%. And it's also good to see that all divisions -- we have 4 divisions in Sweden, all the divisions increased their order backlog in the last quarter last year. So we have talked quite a lot about the impact on residential, and I think we start to see that the impact on residential is limited for Bravida in Sweden.So we continue with next slide and Norway. Also in Norway, we continue with the good growth, 13%. And this is also mainly organic growth, but also some currency impact. EBITA margin was 6.6%, and here, we have the dilution from Oras. And if we exclude for a minute Oras and look into, say, the old Bravida, we had EBITA margin at 7.1% -- and 7.5% in the old Bravida. So a continued stable good development in the old Bravida.This dilution will come to its end after Q1 and -- while we are phasing out the old Oras project with low profitability. If we look into the order backlog and order intake, order backlog slightly decreased in year-on-year with 9%. But as we have said many times earlier, that we are working and tried to finalize the old Oras backlog. And if we look to the last 12 months, we had produced 75% of the old order backlog we bought in May '17 from Oras.Okay. We can continue with Denmark. And Denmark top line growth with 23%. This is also mainly organic growth, but also some currency impact. We have had a high production in a couple of large projects. There is 2 hospitals and 1 data center. Margin wise, we continue to improve EBITA margin. If we look for the full year, I think we have taken the step to new level. We have increased from 5.1% to 5.8%, and we start to have a really nice business now in Denmark. Order backlog, it's more or less flat. It's increased with 2% year-on-year. And as I said earlier, we have had a high production in 3 large projects. But it's good to see that the order backlog has continued on a high level and has been replaced by a couple of -- many small and mid-sized orders. So if we look for the full year growth in Denmark, 24%. Of course, it's hard to have this next year, on 2019, as well, but it's explained by these 3 large orders.If we go to Finland. Top line is up with 63%, and this is mainly explained by the acquisition we made in 2018. We see a large improvement in the EBITA margin from 3.9% to 5.5%. And here, it's also the -- mainly the 2 acquisition we finalized in 2018. It's Adison and Hangö, who actually delivered better than the plan we had. So it's great to see that we have been successful in this acquisition. If we look into the order intake and order backlog, we see a strong development. And it's -- both order intake and order backlog is up with over 60%, and this is promising for 2019.If we look for next slide and start to look into the cash flow and net debt development. As Mattias said earlier, Bravida continued to deliver strong cash flow. We have taken down the net debt to SEK 1,365,000,000 from SEK 2,062,000,000 in Q3. And also, the net debt to EBITDA were on 1.7 in the end of Q3, and now it's down to 1.1.If you look to the bottom of the page, we see the operating cash flow, and it's more or less the same figure for 2017 and '18. But please remember that we have paid SEK 219 million, 2-1-9, in tax in 2018, and it was only SEK 95 million in 2017. So if we look for the real operating cash flow, it actually increased with 12% year-over-year. And it's good to see that cash conversion is 102%, and actually, that's slightly above our financial target.If you look for the dividend, we proposed to the annual meeting an increase with 29%. This is more or less 42% of the net profit. If we look for the average increase since we did the IPO in '15, there has been an average increase of 26% since the IPO. As many other companies, we will start to implement or use new accounting rules, IFRS 16, from January. And we have quite many lease costs, lease service costs, 5,600, and we will more or less rent all the buildings. More or less, 265 buildings we are using. And according to the program of calculation we have done, the EBITA will increase from 6.3% to 6.4, and then the net debt to EBITDA will from 1.1 to 1.5. So there will be an impact on this figure, but we don't see, for this reason -- and there is no really any reason to change the financial targets if we -- when we start to use the IFRS 16.So if we look for next slide and look just -- look for the financial targets. We are committed to grow the business with over 10%, and we -- as I said earlier, Q4 was 12% and the full year was 12%. EBITA is -- we will take this to 7%. We improved it from 6.2% to 6.3%. There is still a dilution from Oras and Finland, you can say, and we are quite sure they will start improve their results in 2019. Cash conversion above 100%. We have delivered 102%. And if we look for the dividend, it's -- proposal is up with 29%, corresponding to 42% of the net profit per share. And as I said earlier, it's an average increase of 26% since the IPO. Net debt in the balance sheet, we are saying that we should be around the 2.5. We were on 1.1 in the end of December. If we -- when we now start to implement IFRS 16, it will increase with 0.4 up to 1.5.So I think I leave over to Mattias to summarize.

[Mattias Johansson, CEO & Group President]

Thank you. Slide 16, we have the summary of the Q4 report. And it's a lot of things to summarize. And overall, a really strong performance that we are happy to announce, of course. Sales increase of 12%, a mix between organic growth and acquisitions, and well in line with the financial target. The order backlog is at a good level, record level, and we can see a good continued business momentum for service in the future, and that will support organic growth in coming quarters as well. The EBITA margin is stable at close to 8%. We see and we are seeing improvements in Finland and Denmark. M&A execution is on track with a healthy pipeline. We did 12 acquisitions in '18, adding SEK 800 million in sales, and we have started '19 good as well. And we have reinforced the M&A team, as I mentioned earlier, to improve this part of the business even more. Net debt, as Nils-Johan just said, 1.1x EBITDA. We have -- operating cash flow improved compared to last year, and cash conversion is above financial target, and it's at 102%. The proposed dividend is at SEK 2 per share, and that's increased by 29% and 42% of the earnings per share. And we still see good market conditions to continue.So I think this shows the business model, the beauty of the business model. Strong cash flow generating. We can take down the debt ratio. And we can do -- as well as we increase the dividend, we can continue to do acquisitions. And we think -- I think this is a good quarter, and we have positive view on the coming quarters as well.So thank you very much. And now we can open up for some questions.

[Operator]

[Operator Instructions] Our first question is from Predrag Savinovic from Nordea.

[Predrag Savinovic, Analyst of Consumer Goods]

On the order intake in Sweden, it was very strong from the Stockholm Bypass. But even excluding this, it's up considerably, which is very positive. Can you talk about this? Where does this come down? Why now, after it's been in the negative territory for a couple of quarters?

[Mattias Johansson, CEO & Group President]

No, but I think our business model, our footprint is actually that we are located in many different places, and there has been a lot of focus on the residentials. And as you know, residentials is a small part of our business. We are not dependent on any single market, any single customers, et cetera. Actually, regarding residentials, we have said earlier that the new deal part of the residentials has been 10% of our sales, and that's very stable. We have also seen and we have expected that the renovation of residentials will go up, and that's something we can see as well in the book, so that's a much better business for us. So I think the mix between the service and renovation is more than 60% of our sales in total. That mix, together with our diversified markets on many different places in 4 countries, and when you asked about Sweden, we are in very many places in Sweden as well, and the demand for our services and the installation part is overall good in Sweden. So I think that's the reason behind the order intake or the order backlog in Sweden. And I also think that, as you know, this can and will vary between different quarters, depending on where we book the new signed contracts into the system, et cetera. So I think, overall, it just shows me that we have a good organization and we have a strong demand in the markets. And yes, as mentioned, the construction companies as well. I think all the big construction companies that we can see so far have announced increased order backlogs compared to last year as well. And that's also -- they are ahead of us in the cycle. And we can see numbers about confidence indicators regarding the technical consultants, et cetera, and they have flattened out as well. So yes, a strong demand in the market, I would say.

[Predrag Savinovic, Analyst of Consumer Goods]

And these orders here, they're not -- I mean, since it's almost a 30% figure, are there any bigger contracts here? Any change in terms of average order size or in line with usually?

[Mattias Johansson, CEO & Group President]

I'm sorry, not [ as big as ] the Stockholm Bypass Project, I would say. They're only small and mid-sized projects that we actually have won.

[Predrag Savinovic, Analyst of Consumer Goods]

All right. And you still have some backlog left in Oras in Norway, where the deliveries will be finalized in Q1 next year. And upon completing this, do you expect to turn up at the same margins as your other Norwegian operations right away? Or will there still be some dilution from organizational differences, et cetera?

[Mattias Johansson, CEO & Group President]

I think it will take some time, of course. But in the long-term perspective or -- it's possible to get the same margin, of course. But our business is very much about changing people's behavior, and we don't have any machines we're adjusting. But regarding the dilution from orders, I would say, it's 1, maybe 2 projects that we're struggling with for the moment that dilutes the margin most. If we look at Oras as -- the broader picture about Oras, I would say that 12 out of 13 places or 11 out of 12 places we are heading definitely in the right direction. So it's an isolated challenge, I would say, and that will phase out in Q1 '19. And then the margin will gradually improve. And hopefully, we can, of course -- meet the margin in Oras as we have in the existing Norwegian business. But we need to remember that it will take a couple of years or more than a couple of years. And then I think, also, we should remember that the Norwegian margin needs some high levels.

[Predrag Savinovic, Analyst of Consumer Goods]

And then the Danish operations here, you speak of 2 large orders driving the growth, particularly in 2018. And could you quantify how much these add to the top line for Denmark?

[Mattias Johansson, CEO & Group President]

Do we have that now?

[Nils-Johan Andersson]

No. I figured it's 2 hospitals' orders and I think we -- I have to come back, we -- with how much we produced on these orders in last -- in 2018.

[Mattias Johansson, CEO & Group President]

But the growth is not only coming from those projects, because we have a...

[Nils-Johan Andersson]

No, no. No.

[Mattias Johansson, CEO & Group President]

That's what you're asking for, so very strong market in Denmark.

[Predrag Savinovic, Analyst of Consumer Goods]

Super. And then how much would you say that the calendar affects you negatively in the quarter, on the service side? Is it like 1%, 1.5% on organic growth?

[Nils-Johan Andersson]

I think we -- it's hard. We have seen other companies coming up with, but they were talking about base. So we -- it's -- we saw it clearly in mid-December, that the activity level slowed down. We also saw it also when we -- the material projects also came down. And it's had the biggest impact on the service business. It's hard to estimate, and it will be -- but it was a clear effect. And people talk -- so also, when we look for what people used -- look into the books and how they used the holiday, it was in higher level in '18 compared to '17. So it has an impact in December. But as we said earlier, it's good to see that we are back on track again in January.

[Predrag Savinovic, Analyst of Consumer Goods]

Very good. And finally here, in terms of M&A growth in the Nordics, could you update us a bit on the current market share in the respective countries and how much bigger it can get before it's too much? I mean, are we talking about double your size here before authorities say anything more?

[Mattias Johansson, CEO & Group President]

I think the pipeline is -- or I know the pipeline is strong. We can continue to do M&A for -- yes, for a long time. We have the cash to do it. We have the organization to do it. We have the organization to integrate it. And remember that we have a market share in Sweden, which is our biggest market, that's around 11%. And I think that just shows us that we can, yes, be much, much bigger before we meet that type of resistance, I will say. So that's nothing we think about for the coming business time period at least.

[Operator]

Our next question is from Lucas Ferhani from Deutsche Bank.

[Lucas Ferhani, Research Analyst]

Just wanted to ask a question on the mix in Sweden between service and installation over the year rather than just this quarter. It does seem installation grew at a slower pace and the service grew very highly. Kind of what's your thinking around handling this mix? Are you still trying to grow as much in installation as possible as the service or has this changed? And what are the possibilities the market kind of forced you to move towards service?

[Mattias Johansson, CEO & Group President]

Yes, I think this is a jewel track, if you can call it by -- like that. We have 2 different ways of working with the different segments. We, of course, always want to improve and increase the services, definitely. And we see the demand in the market, and we also think that we can act more proactive to be able to win more service -- contract service agreements, et cetera. On the other hand, we see a strong demand for the installation, which means that we, of course, want to kind of take advantage of that demand and try to win the projects we can on the installation side as well. But the margin is more important than volume. We don't -- we price the risk. And we have high production in Sweden on installation for the moment. And the mix can change from one time to another, depending on how high the production is on the installation side. But the most important thing is that we can see growth in service and installation paralleling. And so I don't know if I answered your question, but it's important to develop the service business because that's more stable in the long term. On the other hand, of course, we want to contribute from this high demand in the -- on the installation side.

[Lucas Ferhani, Research Analyst]

That does answer my -- I mean, it was just before you said you're still trying to work as much as possible in installation. But like you said, maybe at a point in the cycle where the situation becomes probably harder to go in installation, do you, I mean, meaningfully try yourself to grow towards service, but you pretty much answered that question. Another one was on the working capital. You said you made improvements, and the cash flow is really good. Can you talk about what kind of improvements were made? And do you still see progress on the working capital?

[Nils-Johan Andersson]

Yes, we -- there is a clear seasonality in our cash flow. And if we take the overall picture, where we always have the strongest cash flow in the fourth quarter and the weakest normally in the third quarter, we'll continue to work on the both side, both on the receivables and payables. I think there was -- we are -- there is no really big changes in -- if you look for the receivables and payables. But we -- of course, we are really pleased that we are, again, coming up with a strong cash generation and we are able to keep the cash conversion over 100% in this quarter as well.

[Lucas Ferhani, Research Analyst]

Great. And the last one would be, can you have a quick update on the bypass project? And I remember last quarter you said that you're looking to hire a bit more people, maybe some consultants, to help you, given the scale of that project.

[Mattias Johansson, CEO & Group President]

Yes, I think it's an early stage in the project. But of course, we have started the work. It's around 2 years of design and preparation now, and the organization is build up. And I think I said some of the resources will be internally, and we will, of course, do some external consultants in this project as well. But when we say external consultants, that's people that we have been working together with in earlier projects as well. So they are semi-hired, you can say that, only known people and with experience from the same type of project. I think this is going -- it has just started, but it's following the plan. We have a steering committee, where I take part as well in this project. And we are confident and looking forward to executing this project together with the customer, of course.

[Operator]

Our next question is from Karl-Johan Bonnevier from DNB Markets.

[Karl-Johan Bonnevier]

Yes, you gave us some great guidance for IFRS 16 inclusion in your numbers coming up to Q1. Could you just clarify, if possible, to -- what kind of impact would you see on the EBITDA line? And do you expect anything at the bottom line, say, net profits?

[Nils-Johan Andersson]

EBITDA will -- according to the preliminary calculation, increase with 1.8%. And as I said, EBITA will increase with 0.1, and there is limited impact on the net profit. It's -- as I said, that the net debt to EBITDA will increase from -- with 0.4 going -- if you look for the pro forma in the end of last year, going from 1.1 to 1.5. And so the net debt will increase with -- we have a figure for SEK 1.38 billion. That's the impact on the balance sheet.

[Karl-Johan Bonnevier]

And I guess the change to net debt won't have any impact on your covenants or anything like that? Or what you have to do for that, so...

[Nils-Johan Andersson]

No, no. No, not that. No, the bank agreement we have, they exclude changing the accounting rules. So it's not -- and of course, the covenants, compared to where we are today, is on a completely different level. So it's not really an issue.

[Karl-Johan Bonnevier]

Excellent. And then just on the M&A pipeline, do you see that you have any larger transaction of the order size or upwards in the pipeline as well? Or should we expect more of the small or mid-sized kind of acquisitions?

[Mattias Johansson, CEO & Group President]

No. The answer is no for the moment, and I think it's hard to guide on that one as well. But of course, we look into everything. I think what's really created value for us when we look back to what we have done is, of course, a deal like Oras. But it's very often more convenient and more efficient to actually integrate the bolt-ons, slightly smaller or somewhere between SEK 50 million and SEK 100 million in that area, or SEK 50 million to SEK 150 million or whatever. It's -- but of course, we have a position and we want to have the position even if we increase the dividend with the 29%. We still have a position to act on that type of target if the opportunity comes. So we all control it, but we don't have any discussion of that kind for the moment.

[Operator]

[Operator Instructions] Our next question is from Stefan Andersson from SEB.

[Stefan E. Andersson, Analyst]

Two questions. Just first one on Finland, small division, but anyhow, on the margin there. The new management there made a cleanout 2 quarters ago, and now, all of a sudden, it bumps back to 5.5%, which is the highest we've seen. Just give us a flavor, is that from adjustments in the fourth quarter as it might be? Or is this really the level you operate in Finland on?

[Nils-Johan Andersson]

No, you're correct. We said that when we had Marko join us, he took out some costs in the second quarter. And -- but it's not really that we're releasing some reserves in Finland now. It's -- as I said, we see a good development in the acquisition we did in Adison, we booked in January; and Hangö, we took over in, I think, the beginning of October. Good development. And so -- and we have now also strengthened team. We have a new regional manager coming in here in the Jyväskylä-Tampere area. And also, of course, Marko and team are doing an excellent work now. 5.5% is -- yes, so when we look into this figure, this Q4 figure, where we normally have always the highest margin, but, of course, there is -- it's a much more stable situation in Finland today compared to a year ago. And yes, we will look forward with a strong order intake, a strong backlog to '19 as well.

[Mattias Johansson, CEO & Group President]

Yes. And I think just to go back to what I said earlier, Stefan, we have, of course, said that we haven't reached critical mass before. But we have also said we were not in the hurry to reach that size. We said it's important to build the building brick by brick, and also when we do acquisitions, to do good acquisitions. And I think this is the result of 2 good acquisitions that have come into Bravida in combination with the existing business that is improving in many places, even if we are not happy in all places. But a seasonality in the margin, of course, as Nils-Johan mentioned, but we will definitely see a much better '19 than '18.

[Nils-Johan Andersson]

And we -- I've something else to give -- we continue to implement Bravida Way, and now educate everyone in our productivity in what we call Bravida [ boss ] program, and hopefully, will support the business in the coming quarters.

[Stefan E. Andersson, Analyst]

Great. Then on Sweden, you mentioned that there was -- that you had this positive effect last year in Sweden. If you look at that margin in this quarter, I know that you sometimes have successful ending of projects that could release a little bit. I mean, I know the seasonality happens. But would you say that, that margin is normal at the level you're operating right now for being at Q4? Or is there something extra in there that it's good for us to know when we do our estimates?

[Nils-Johan Andersson]

No. I think the margin we have, the 8.5%, there is nothing -- there is no extra money otherwise, positive or negative. So this is -- I think this is normal or plain results, I should say.

[Operator]

Our next question is from Lucas Ferhani from Deutsche Bank.

[Lucas Ferhani, Research Analyst]

I'm sorry, that's fine on my end already.

[Operator]

Sorry. Do you not want to ask a question?

[Lucas Ferhani, Research Analyst]

No, no. That's fine on my end, sorry.

[Operator]

And as there are no further questions, I will hand the word back to the speakers for any final comments.

[Mattias Johansson, CEO & Group President]

Okay. Thank you very much, everyone. Good questions and a good report. I think that's a good start of this day. So thank you very much all of you, and see you soon again. And have a nice day. Thank you. Bye.

[Nils-Johan Andersson]

Thank you. Bye.

[Operator]

This now concludes our conference call. You may now disconnect your lines.