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Investing.com -- Afry’s on Tuesday said its second-quarter earnings declined on lower sales and fewer working days, with key metrics missing consensus expectations.
Net sales totaled SEK 6.67 billion, down 7.2% from SEK 7.20 billion in the same period last year. Organic growth, after adjusting for calendar effects, saw a 2.5% decline.
Adjusted EBITA fell 23.4% to SEK 438 million, with a margin of 6.6%, compared to 8% a year earlier.
Calendar effects reduced EBITA by SEK 104 million. Excluding this, the margin was flat year-over-year, suggesting stable underlying profitability.
Jefferies analysts noted the results were 3% below consensus on sales and 7% below on adjusted EBITA.
Segment performance varied. Infrastructure reported sales of SEK 2.65 billion, down 4.4%. Adjusted organic growth was 0.5%. EBITA declined 19.7% to SEK 171 million, with a margin of 6.5% (7.7%).
Sales in Industrial & Digital Solutions decreased by 8.1% to SEK 1.67 billion, with an adjusted organic growth decline of 5.7%. EBITA dropped to SEK 104 million from SEK 116 million, and the margin narrowed to 6.2% from 6.4%.
Sales in Process Industries decreased by 10.6% to SEK 1.25 billion, with adjusted organic growth showing a 3.6% decline.
EBITA edged down to SEK 125 million from SEK 129 million, while the margin rose to 10% from 9.3%, supported by project completions.
Energy posted sales of SEK 978 million, down 0.8%, but adjusted organic growth reached 4.2%. EBITA decreased to SEK 92 million from SEK 96 million, with the margin at 9.4% (9.8%).
Management Consulting recorded a 14.4% drop in sales to SEK 393 million. EBITA halved to SEK 37 million from SEK 72 million, and the margin fell to 9.4% from 15.7%, while adjusted organic growth was down 9.4%.
Capacity utilization declined to 72.6% from 73.4%. Afry’s order backlog increased 3.8% year-over-year to SEK 20.7 billion.
New contracts included work on Norway’s nuclear decommissioning and Zurich’s Western Bypass.
Cash flow from operating activities was SEK 353 million, compared with SEK 420 million a year earlier.
Net debt excluding lease liabilities rose to SEK 5.13 billion from SEK 4.66 billion. Earnings per share declined to SEK 1.71 from SEK 3.33.
Afry booked SEK 91 million in restructuring costs related to an ongoing reorganization.
The company expects further costs of SEK 200–300 million over the next year, with a targeted payback of one year.