The Financial Statements for the financial year 2019 are now available1. They are proposed to be later adopted by the Annual General Meeting of shareholders.
The CEO’s and CFO’s comments on the 2019 financial result and the current situation
As You may see from the Financial Statements, the result for the financial year 2019 was moderate and did not completely fulfill our expectations. This was mainly due to some organizational changes in some of the Group companies and some delays in the project startups. The completion of the West Metro consortium project had a negative impact on the Group’s sales volume as the engineering work provided by certain larger group of engineering companies, including not only Solwers companies, was administrated through a Solwers’ subsidiary, Finnmap Infra Oy.
The COVID-19 situation has already had and will certainly continue to have some impact on our business, but its magnitude is very difficult to predict at this point. It depends on the length of the pandemic and on changes to be eventually seen in client behavior. A major part of our turnover is related to infrastructure and financial services consulting, and these business segments have not yet suffered that much from the pandemic. However, the COVID-19 situation has already had a negative impact on the architectural design as many hotel-, office-, commercial- and congress center projects are being postponed or cancelled.
Some new business acquisitions have been planned for 2020 and at this point we believe that we are able to close them during this year despite the COVID-19 situation. The result for the first four months (Jan-April 2020)2 of the year was satisfying the consolidated revenue being EUR 9 million and operating profit EUR 1 million. Our current full year EBIT forecast is EUR 1.8 million (7%), but it should be noted that in this exceptional situation there are many uncertainties related to execution of all major projects as well as to forecasting.
Stefan Nyström, CEO
Solwers continued in 2019 with its active acquisition strategy by acquiring two new companies, KAM Redovisning AB and Dreem AB. Despite the excellent profitability of these two newcomers, the group’s performance stagnated somewhat compared to previous year due to some challenges on the Finnish market.
Implementation of the growth strategy will continue in 2020, but with added focus on raising profitability. The company’s balanced capital structure (equity ratio 41.6 % at year-end 2019) and continuing good operating cash flow (EUR +1.9 million in 2019) as well as the satisfying Q1/2020 performance form a good base to continue building on.
Roger Lindqvist, CFO
1) If You wish to receive a copy in Finnish, please contact info(a)solwers.fi
2) Please note that all 2020 figures presented are unaudited