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NET ASSET VALUE AND THE LATOUR SHARE
- The net asset value at the end of the period was SEK 215 per share compared with SEK 198 per share at the start of the year, which is an increase of 11.0 per cent adjusted for dividends. The benchmark index (SIXRX) rose 8.6 per cent. The net asset value was SEK 223 per share at 10 February.1
- The total return on the Latour share was 6.7 per cent compared with the SIXRX, which increased 8.6 per cent.
- The Board of Directors proposes an increased dividend of SEK 4.60 (4.10) per share.
INDUSTRIAL OPERATIONS
The fourth quarter
- The industrial operations' order intake rose 9 per cent to SEK 6,924 m (6,374 m). Adjusted for exchange rate effects, this equates to growth of 2 per cent for comparable entities.
- The industrial operations' net sales rose 9 per cent to SEK 7,014 m (6,463 m). Adjusted for exchange rate effects, this equates to growth of 2 per cent for comparable entities.
- The industrial operations' operating profit increased by 15 per cent to SEK 986 m (856 m), which equates to an operating margin of 14.1 (13.2) per cent.
- Bemsiq acquired the Canadian company Armstrong during the fourth quarter, and agreements were signed by Swegon for the acquisition of the German company Howatherm, and by LSAB, within Latour Industries, for the acquisition of the German company HDS Group. Both acquisitions were completed in January 2025. During the fourth quarter, Latour Future Solutions invested in and became a minority shareholder in the Swedish company Perific Technologies.
INDUSTRIAL OPERATIONS
Full year
- The industrial operations' order intake rose 5 per cent to SEK 25,497 m (24,388 m). Adjusted for exchange rate effects, this equates to growth of 1 per cent for comparable entities.
- The industrial operations' net sales rose 1 per cent to SEK 25,886 m (25,550 m). Adjusted for exchange rate effects, this represents a 2 per cent decline for comparable entities.
- The operating profit fell 3 per cent to SEK 3,708 m (3,807 m), which is equivalent to an operating margin of 14.3 (14.9) per cent.
- In the first quarter, Innovalift acquired the German company BS Tableau, Bemsiq acquired 51 per cent of the shares in the Italian company Eelectron, and Nord-Lock Group acquired the Canadian companies Precision Bolting Ltd and Condor Machinery Ltd. In the second quarter, Latour Future Solutions invested in the Swedish companies Plant and Econans, both conducted through private placements of new shares, with Latour Future Solutions becoming a minority shareholder in the companies. In the third quarter, Swegon acquired the Dutch company HC Groep, Bemsiq acquired the Canadian company QEL, and Innovalift signed an agreement to acquire the Turkish company Arkel, which was completed in January 2025.
THE GROUP
- Consolidated net sales totalled SEK 25,886 m (25,550 m), and profit after financial items was SEK 7,005 m (6,645 m). The net impact of impairments and reversals of impairments of shares in associates on the income statement in the period was SEK 661 m (639 m).
- Consolidated profit after tax was SEK 6,200 m (5,901 m), which is equivalent to SEK 9.65 (9.22) per share.
- The Group reported net debt of SEK 14,021 m (11,433 m). Net debt, excluding lease liabilities recognised under IFRS 16, was SEK 12,292 m (9,983 m) and is equivalent to 8 (7) per cent of the market value of total assets.
INVESTMENT PORTFOLIO
- The value of the investment portfolio increased by 14.3 per cent during the year when adjusted for dividends and portfolio changes. The benchmark index (SIXRX) rose 8.6 per cent.
- During the year, Latour participated in the issue of new shares by HMS Networks, pro rata to its holding, purchasing 905,244 shares in the company for SEK 362 m, and also increased its holding in CTEK by 317,151 shares.
EVENTS AFTER THE REPORTING PERIOD
- In January, Hultafors Group acquired the Danish company Lyngsøe Rainwear and the acquisitions of Arkel, HDS Group and Howatherm were completed. More details can be found on page 4.
- Mikael Johnson Albrektsson, CEO of business area Bemsiq, has been appointed new CFO of Latour and will start on May 1, 2025.
1The calculation of the net asset value on 10 February was based on the value of the investment portfolio at 5.30 p.m. on 10 February and the same values as on 31 December were used for the unlisted portfolio.
Comments from the CEO
"The past year has been characterised by recession and geopolitical tensions. Nonetheless, the industrial operations have delivered positive growth, and we end the year with a robust fourth quarter, in which profitability was strong and organic growth was reported for both order intake and net sales. Demand remains at a relatively good level, but it is a mixed picture across different geographic regions and sectors. Although the construction and real estate markets are generally subdued, there is an upward investment trend in, for instance, energy efficiency improvements. Our three business areas that have the greatest exposure in these markets are being impacted to varying extents by the current economic uncertainty. Swegon and Bemsiq have reported year-on-year growth, while Hultafors Group is just below last year's level in terms of organic growth. The decision-making processes for large-scale projects seem to be taking longer, but few projects come to a complete halt. Caljan's order book is expanding and our assessment is that the logistics sector, which has been hit hard since the pandemic, has begun a gradual recovery. Innovalift, Latour Industries and Nord-Lock Group are reporting stable business development. As always, we are well prepared for any changes in the demand profile.
Both order intake and net sales increased in the fourth quarter by 9 per cent, representing a 2 per cent increase on an organic basis. The operating profit increased by 15 per cent to SEK 986 m (856 m) with an operating margin of 14.1 (13.2) per cent. The good profitability is supported by our strong gross margins. Overall, we are very satisfied with the performance delivered in the fourth quarter.
The year as a whole has developed positively, especially given the challenging conditions. The order intake grew by 5 per cent to SEK 25,497 m (24,388 m) and net sales increased 1 per cent to SEK 25,886 m (25,550 m). Operating profit stands at SEK 3,708 m (3,807 m) with an operating margin of 14.3 (14.9) per cent. Our business areas have adapted their operations to prevailing conditions and keep a firm control over their costs. We have good delivery capacity and continue to provide our customers with a high level of service. Cash flow has been strong during the year and operating cash flow stands at SEK 3,651 m.
Latour's financial strength enables us to continue to invest forward in our operations, regardless of the economic situation. Our long-term investment horizon provides security and stability for our companies, employees and business partners. For us, it is important that the companies remain at the forefront of their industries to ensure long-term sustainability and profitability, and we are continuously investing in our factories and in product development and digitalisation.
There was significantly higher acquisition activity during 2024 than in 2023, when the level was intentionally kept low. During the fourth quarter, we acquired one business and signed agreements for the acquisition of another two, both of which were finalised in January 2025. Bemsiq acquired the Canadian company Armstrong and is thus further broadening its range of gas detection systems. Swegon acquired Howatherm, a German manufacturer of air handling units. The acquisition strengthens Swegon's position in the German HVAC market. Finally, within Latour Industries, LSAB acquired HDS Group in Germany, thus strengthening its position in Europe's largest wood market. Earlier in the year, we acquired five businesses and signed an agreement for another acquisition that was completed in January. If we include the acquisitions that were finalised in January 2025, we have added annual acquired growth of just under SEK 3 billion during the year. The profitability of all of the acquired businesses is well in line with Latour's other industrial operations. The process of identifying suitable targets continues at an unrelenting pace and we have substantial scope for further acquisitions. More information about our acquisitions can be found on page 4.
The net asset value in Latour increased by 11.0 per cent during the year, adjusted for dividends. The value of our portfolio of listed holdings increased by 14.3 per cent. By comparison, the benchmark index SIXRX increased by 8.6 per cent. Several of our listed holdings have submitted their financial statements for the fourth quarter. The picture for 2024 generally reflects the challenging market environment, although a number of the companies saw their order intake moving in the right direction in the fourth quarter. Despite the uncertain economic situation, the levels of earning are high and, in some cases, rising. The strong and stable performance enables acquisition activities in our listed holdings too. ASSA ABLOY, HMS Networks, Nederman and Troax have together completed several acquisitions during the quarter.
Based on the strong results of both the industrial operations and the listed holdings, the Board of Directors proposes an increased dividend of SEK 4.60 (4.10) per share, which is equivalent to an increase of 12.2 per cent."
Johan Hjertonsson
President and CEO
For further information please contact:
Johan Hjertonsson, President and CEO, Tel. +46 702-29 77 93 or
Anders Mörck, CFO, Tel. +46 706-46 52 110
Conference call
President and CEO Johan Hjertonsson and CFO Anders Mörck present the report and answers to questions in a webcasted teleconference today at 10.00 AM (CET). The conference call will be held in English.
Webcast
Via the webcast you are able to ask written questions.
If you wish to participate via webcast, please use the link: https://latour.events.inderes.com/q4-report-2024
Teleconference
You can ask questions verbally via the teleconference.
If you wish to participate via teleconference, please register on the link below.
After registration you will be provided phone numbers and a conference ID to access the conference.
https://conference.inderes.com/teleconference/?id=5005727
The information contained in this report constitutes information which Investment AB Latour (publ) is required to disclose under the EU Market Abuse Regulation. The information was provided by the above contact persons for publication on 11 February 2025 at 08.30 CET.