JULY–SEPTEMBER 2023

• Revenue amounted to EUR 42.0 million (42.0)
• EBIT increased to EUR 1.7 million (-0.4), corresponding to an EBIT margin of 4.1% (-1.1%)
• Net result for the period was EUR 0.1 million (-3.0)
• Operating cash flow improved to EUR 4.3 million (-4.7)
• Earnings per share, basic and diluted, increased to EUR 0.001 (-0.032)

JANUARY–SEPTEMBER 2023

• Order backlog decreased -11.3% to EUR 136.5 million (153.9)
• Revenue increased 25.9% to EUR 127.2 million (101.0)
• EBIT improved to EUR 3.2 million (-2.9), corresponding to an EBIT margin of 2.5% (-2.8%)
• Net result for the period was EUR -2.2 million (-6.3)
• Operating cash flow amounted to EUR -3.2 million (-2.6)
• Earnings per share, basic and diluted, amounted to EUR -0.021 (-0.067)

KEY EVENTS DURING THE THIRD QUARTER

• Commissioning of the world’s first ultra-fast 3 MW charging system for battery-powered heavy-duty vehicles, supplied by Cavotec

KEY EVENTS AFTER THE THIRD QUARTER

• Order valued at EUR 6.65 million from one of the world’s largest shipping companies for PowerFit, Cavotec’s containerized solutions for high-voltage connection of vessels to shore
• Long-term service agreement signed with COSCO Group

Comment from the CEO

On the right track to build a stronger Cavotec

We have achieved important progress in the transformation of Cavotec during the quarter. We report positive EBIT for the third consecutive quarter as well as positive operating cash flow and net result in the quarter. These are key improvements in our work to create a stronger, value creating Cavotec. We have set clear strategic priorities that we focus on to capitalize on the strong megatrends of electrification and reduced greenhouse gases that drive our market.

In the quarter, revenue amounted to EUR 42.0 million and was at the same level as previous year. Our focus on profitable growth has resulted in a normalization of the order backlog while we continue to see a steady stream of customer inquiries and strong interest in our cleantech solutions. An example of a recent customer win after the end of the quarter, is the order from one of the world’s largest shipping companies for shore power, valued at EUR 6.65 million. At the same time, the trend persists where customers carefully evaluate the macroeconomic environment.

It is encouraging to see that we for the third consecutive quarter report a positive EBIT. In the quarter, EBIT amounted to EUR 1.7 million, an improvement from last year’s loss of EUR -0.4 million. This improvement is mainly reflecting reduced operating expenses. We also achieved a positive operating cash flow of EUR 4.3 million and report a net profit of EUR 0.1 million in the quarter. These numbers demonstrate that we are on the right track with the transformation and building of a stronger company.

We lay the foundation for value creation
With the transformation of Cavotec, we create the conditions for growth with stable profitability and good cash flow. In that work, we do a total review of the company and focus on strategic priorities which include customers and go-to-market, operational excellence, cost control, culture and values, and innovation. This work has been ongoing since I took on the CEO role just over a year ago and we have already achieved major strategic improvements that lay the foundation for a Cavotec that creates value for customers, employees and shareholders.

Comprehensive change programs
Our change programs are comprehensive and cover the entire group. Let me give some examples of what the changes include. As part of the go-to-market priorities, we will establish clear responsibilities for following up on customer projects which will make us more efficient and reduce for example invoicing time. An example of how we improve production and procurement is our new Indian assembly unit that will serve the significant Indian market and gives us the opportunity to use the local supplier base. By having our assembly units close to customers, we save costs while building closer customer relationships. Cost control is also an important component of the transformation and must constantly be present in all our processes and characterize our daily work.

Culture key to success
I am convinced that we can only achieve our strategic priorities if we have a culture characterized by openness and a common desire to reach the same goals, while working as one company. At the same time, innovation – which I give a broader meaning than just developing and creating new products and services – must be present in everything we do. If we are to succeed in our change work, we must all be innovative, dare to question existing routines and be open to new ideas and ways of working.

Megatrends supported by legislation
We have an attractive offer and our markets are driven by strong megatrends. The need to electrify operations and reduce greenhouse gas emissions is growing worldwide. This trend is supported by authorities that all over the world introduce regulations in, for example ports, to reduce emissions and noise pollution. With Cavotec’s solutions, our customers can electrify their operations as well as reduce emissions and noise. In addition, our products and solutions create safer and more attractive workplaces.

Good customer case from Sweden
A good example of how we succeed in this is from the port of Kapellskär, north of Stockholm in Sweden. In mid-September, Sweden got its first port – Kapellskär – with automatic mooring of a ship using vacuum technology. We have delivered and provided service for the automatic mooring with vacuum plates and next-generation electrical connection at this port. It is Finnline's brand new ship M/S Finnsirius, which runs on the route Kapellskär – Naandal in Finland with automated vacuum plates. The plates moor and unmoor the ship in less than 30 seconds. In addition to making mooring and unloading faster, emissions are reduced and workplaces become safer.

On the right track
With the plans and strategic priorities we have, I am confident that we are on the right track to build a stronger Cavotec and grow profitably. We are well positioned to be a key player in the transition to a more sustainable, emission-free world.

David Pagels
Chief Executive Officer

Webcasted presentation and telco
CEO David Pagels and CFO Joakim Wahlquist will present the interim report on Friday 10 November at 10:00 am CET. If you wish to participate via webcast, please use the link https://ir.financialhearings.com/cavotec-q3-report-2023/register. Via the webcast you may submit written questions. If you wish to participate via teleconference, please register on the link https://conference.financialhearings.com/teleconference/?id=2001522. After registration you will be provided phone numbers and a conference ID to access the conference. You can ask questions verbally via the teleconference. The presentation is in English.

Interim reports on cavotec.com
The full report and previous interim and annual reports are available on https://ir.cavotec.com/financial-reports.

Next report
The fourth quarter and year-end report is published 23 February 2024 at 7:00 am CET.