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Investing.com -- NRC Group ASA (OL:NRC) reported mixed first-quarter results, as its revenue declined compared to a year ago while profitability improved. The company said it expects to hit its EBIT margin targets in 2025 and 2028.
The Norwegian construction engineering company posted Q1 revenue of NOK 1,264 million, down from NOK 1,306 million in the same period last year.
Operating profit (EBIT) came in at a loss of NOK 27 million, an improvement from the NOK 99 million loss a year earlier. The EBIT margin improved to -2.1% from -7.5%. Adjusted EBIT in the prior year was NOK -43 million.
NRC Group announced a change in its key profitability metric and guidance basis, moving from adjusted EBIT to reported EBIT.
Cash flow from operations was negative NOK 150 million, compared to negative NOK 126 million in the first quarter of 2023. The decline was primarily driven by a rise in net working capital, the company said. Net interest-bearing debt increased by NOK 209 million during the quarter to NOK 832 million.
The order backlog grew to NOK 8,875 million from NOK 8,195 million a year ago. The company reported a strong book-to-bill ratio of 1.8x for the quarter, with total order intake at NOK 2,238 million. This includes a NOK 463 million contract for the rehabilitation and upgrade of the Melhus and Ler railway stations.
"NRC Group is on the right path to deliver profitable growth going forward. We have established a stronger foundation after restarting the company last year, were we made significant changes internally," said NRC Group CEO Anders Gustafsson.
With a strong order backlog and a solid pipeline, the company said it feels confident about its ability to achieve its EBIT margin targets of above 2.0% in 2025 and above 5% in 2028.