Strong profitability improvement and high growth
CEO comment:
Soltech once again delivers both strong growth and strong profitability.
EBITDA is SEK 31.8 million for the quarter, which is an increase of SEK 76 million compared to last year and our organic growth remains high with 31% in the quarter. The improvement in profitability also results in a significantly higher cash flow from operating activities, which amounted to SEK 40.9 million in the quarter. Our focus on high quality solutions with specialist competencies in solar, roof, façade and electrical technology is starting to pay off and this is the third profitable quarter in a row.
We have a strong quarter behind us and are in the middle of an exciting fall with great business opportunities in all our segments. Not least in solar parks and battery system solutions, where we have many interesting projects coming .
SECOND QUARTER HIGHLIGHTS
• Total revenue increased by 70% to SEK 743.3 (437) million. Growth is driven by both acquisitions and organic growth
• The Group's organic growth was 31% (35%), adjusted for the effects of exchange rate fluctuations. All segments show good organic growth with continued high demand for services where the solar transformation contributes to new business opportunities
• EBITDA amounted to SEK 31.8 (-44.2) million, the profitability improvement is attributable to a continuous focus on profitability, hard work, synergies and improved purchasing processes
• Operating profit (EBIT) amounted to MSEK 14.4 (-46.7).
• Cash flow from operating activities amounted to MSEK 40.9 (-42)
• Earnings per share before and after dilution amounted to SEK -0.05 (-0.42)
SIGNIFICANT EVENTS DURING THE QUARTER:
• This is the Group's first financial report prepared in accordance with IFRS. Comparative figures have also been recalculated
• Soltech has on April 3, through its subsidiary Takorama AB, acquired 100% of the electrical engineering company Din Elkontakt i Kungälv AB
• Soltech's Annual General Meeting was held on May 11
FIRST HALF OF THE YEAR IN BRIEF
• Total revenue increased by 96% to SEK 1,426.3 (724.4) million. Growth is driven by acquisitions and organic growth
• The Group's organic growth amounted to 39% (39%), not affected by exchange rate fluctuations. All segments show good organic growth with continued high demand for services where the solar transformation contributes to new business opportunities
• EBITDA amounted to SEK 39 (-74.4) million, the profitability improvement is attributable to a continuous focus on profitability, hard work, synergies and improved purchasing processes
• Operating profit (EBIT) amounted to MSEK 4.9 (-83.8).
• Cash flow from operating activities amounted to MSEK 0.4 (-113)
• Earnings per share before and after dilution amounted to SEK -0.35 (-0.85)
Soltech company Provektor has been commissioned to install a more than 5,200 sqm roof-placed solar installation for Åkerholmen Lantbruk in Falköping, where 750 dairy cows produce tens of thousands of liters of milk daily. The solar panels will supply the cow sheds with solar electricity that will power milking machines, fans and coolers for the milk produced. Construction of the installation is expected to start in September.
Provektor is the Soltech Group's largest company in electrical engineering and has deep expertise in electrical installation and automation. Since becoming part of the Group, they have also deepened their solar energy expertise. The company has 13 locations in Skaraborg, Skåne and Halland and currently has approximately 150 employees.
Provektor will now construct its largest solar energy installation to date when Åkerholmen Lantbruk will get a rooftop solar solution of just over 5,200 square meters. The farm is run by Morgan and Camilla Dahlberg and is home to 750 dairy cows and another 1,150 young animals. According to Morgan, the choice of energy solution fell on solar cells was an obvious choice. Both in terms of smart use of unused space but also in terms of maintenance.
– Animal welfare and planning are key for us. I want an energy solution that doesn't take my time and requires minimal maintenance. Since we need our land for grazing and grain, a rooftop solar solution is therefore a good fit. We also have great confidence in Provektor and it will be fun to get our own solar energy solution, says Morgan Dahlberg, farmer.
Agriculture with great solar conditions
Agriculture often has good conditions for solar panels with large unused roof areas. But with milking machines, coolers, fans, lighting and agricultural machinery, an electricity supply that can cope with the high electricity consumption is also required. Something that Provektor has now been entrusted to provide Åkerholmen Lantbruk with.
– This project is very exciting for us. Åkerholmen has perfect installation conditions with large metal roofs with suitable slopes. In addition, we get to work in a beautiful environment and we looking forward to ensuring that agriculture can utilize the sun's rays onwards, says Johan Svensson, Project Manager, Provektor.
Two Soltech companies, Takab i Falun and Borlänge-based E-Mobility, will jointly carry out several assignments for tenant-owner associations in Rättvik and Avesta. The assignments consist of roof renovation, sheet metal work, IMD solutions* and about 1,500 sqm of solar energy distributed over six buildings. The projects start in August and the order value amounts to approximately SEK 11 million.
Soltech has a growth strategy with acquisitions in the solar, roof, façade and electrical engineering industries. Something that builds a group with cross-industry competencies. The goal is then for the companies create synergies such as business advantages for the companies but also predictability for the customers. Something that has now happened when Soltech's two companies based in Dalarna collaborate in new joint deals in Rättvik and Avesta.
The Soltech companies that will carry out the work are Takab i Falun and Borlänge-based E-Mobility. Firstly, Takab will carry out roof renovation on all buildings, including sheet metal work. When the new roofs are in place, E-Mobility will then install approximately 1,500 sqm of solar panels distributed over the six buildings. For the tenant-owner association in Rättvik, E-Mobility will also install smart IMD solutions connected to the solar panels that reduce the total electricity cost for all residents.
– These deals are clear examples of the benefits that are created when our companies work together. Takab i Falun, which has deep roofing expertise but now also solar energy expertise, starts the work, after which Martin Götesson and the team at E-Mobility install solar panels and associated IMD solutions. The customer gets talented entrepreneurs who also have the ambition to collaborate throughout the project, which makes everyone a winner, says Stefan Ölander, CEO of Soltech Energy.
*IMD solutions linked to solar energy solutions create smarter subscription solutions and lower the total electricity cost for all tenant-owners
The construction has started for the Soltech Group's own solar park – Öringe Solpark. It is situated in Getinge in Halmstad municipality. The subsidiary Soltech Energy Solutions carries out the project. The site has been carefully selected according to its good conditions for solar energy and already established grid connection. The investment is made as part of the Soltech Group's sustainability work. When the park is fully completed it will produce electricity equivalent to the household electricity consumption* of more than 1,200 houses. The project is now in building phase one and is expected to be fully operational in spring 2024.
Soltech Energy Solutions is the Soltech Group's operating company in advanced energy systems, energy storage and large-scale solar energy solutions. The company has now begun construction of what will be the Soltech Group's own solar park of approximately 70,000 square meters in Getinge, just outside Halmstad.
– It feels great and exciting that we are now starting construction for Soltech's own solar park. In addition to the fact that it is beneficial business and that it will contribute to the Group reducing its climate footprint, the solar park will contribute with about 5.9 GWh of green electricity to the local area and southern Sweden, says Fredrik A Svensson.
Solar energy and increased biodiversity
The land where the park is established is planned to be managed through mowing and/or grazing, which creates a dynamic living environment for flora and fauna. The solar park will create conditions for increased biodiversity in the area, including sowing of flowering meadow plants and the placement of nests for pollinators and various insect hotels. In this way, pollinators and species that are currently threatened in many parts of Sweden will benefit and thrive in the area.
– For us, it is both important to contribute to the green energy transition but at the same time also protect the surrounding nature and the environment. Through our process, we both respect the place we operate in and contribute to the area's future electricity supply. We are proud and looking forward to constructing a solar park that will contribute to electricity for many households in Halland and that also protects nature and diversity in the area, says Fredrik A Svensson.
Here is more information about Öringe Solpark and how it works when a solar park is established (in Swedish): https://soltechenergysolutions.se/oringe-solpark/
*household electricity consumption calculated on 5,000 kWh/year.
Soltech Energy Sweden AB (publ) has on July 11 acquired 30 percent of the shares in the subsidiary Takorama. Soltech Energy now owns 100 percent of the company and the acquisition of the remaining shares in the company is the next step in strengthening Takorama's transformation towards becoming a solar-roof company. Takorama has more than 30 employees and had a turnover of approximately SEK 50 million in 2022 with a good profit margin. The acquisition is financed entirely from own cash.
Soltech acquired 70 percent of Takorama on March 2, 2020, at the time Takorama had a turnover of approximately SEK 25 million. The remaining 30 percent of the company is now being acquired according to plan. This means that Soltech now owns 100 percent of the company, which during its time in the Soltech Group has been transformed by adding solar energy solutions, electrical technology and battery solutions to its core business within roofing and waterproofing.
– Takorama has gone from being a traditional roofing company to becoming a solar-roof company and, since the additional acquisition of Din Elkontakt this spring, now also has deep expertise in electrical engineering. I am therefore very pleased that we are acquiring the remaining part of the company as part of the work to further strengthen their transformation journey, says Stefan Ölander, CEO of Soltech Energy.
Transformation into a solar-roof company
Takorama is a leading company in the roofing industry in western Sweden and with over 30 years of experience in the industry, they are a well-known player in the region. Since Soltech acquired the company, they have developed a solar energy offering and have helped both old and new customers with roof-placed solar energy solutions, for instance Swedish Mässan Gothia Towers. Soltech invests in its subsidiaries and in April 2023, a bolt on-acquisition was made to Takorama when Din Elkontakt became part of the company. This bolt on-acquisition has made Takorama a full-service company with a complete offering in roofing, solar, battery technology and electrical technology.
– Now we have even better opportunities to sharpen our solar energy offering in combination with roofing and electrical technology. The fact that we are part of the Soltech Group gives us great competitive advantages and we look forward to our future together, says Micke Norrby, CEO of Takorama.
Soltech Energy's subsidiary Soltech Energy Solutions has commissioned an international, reputable financial advisor to identify investors for a majority of the solar park project portfolio of more than 1,000 MWp that has been built up over the past two years. The total remaining portfolio is thus significantly larger than the 300 MWp portion that Solgrid recently became a partner in, a deal in which the estimated future order value for Soltech amounts to between SEK 700 and 1,000 million, in the first stage.
Over the past two years, Soltech Energy Solutions has established a business area focusing on the development of solar park projects. The project portfolio developed includes building rights and land agreements and the majority of the projects are located in the SE4 area. In order to further develop the projects with permit approval and later construction, very large investments are required.
Soltech's focus regarding solar parks is to develop projects, build and manage operation and maintenance. Focus is not ownership of solar parks, with the exception of Soltech's own solar park in Öringe, which is currently being built. Therefore, the goal is to find investors with the ambition to become long-term owners of the solar parks and together with Soltech, further develop the portfolio through contracting and construction. In addition to the existing portfolio, Soltech continues to search for and secure new projects on an ongoing basis.
A transaction such as the one Soltech Energy Solutions is planning with the help of an external financial advisor, would mean that the solar park projects in the portfolio can be made ready for construction faster with the help of external financing and external co-ownership. When the projects then gradually become ready for construction, Soltech has the exclusive right to build. This means that the solar park portfolio would constitute a significant secured business opportunity.
The benefits for Soltech are many. Soltech does not need to finance the large-scale project development of the solar park portfolio itself via a new share issue or take up large loans. The plan is instead to realize shares of the portfolio in the near future and then have the opportunity for long and stable revenues over time from construction, operation, maintenance and support services such as large battery solutions.
Currently, details about the time plan or valuation of the portfolio cannot be disclosed as it is too early in the process. But in order to begin the work of finding investors, the news must be shared with the public market.
– Soltech Energy Solutions has quickly built up a business area for solar parks that has great financial value for the Group and that we look forward to developing together with one or more investors. Our goal is for this to accelerate the green energy transition as well as Soltech's growth and profitability, says Stefan Ölander, CEO of Soltech Energy.
On July 5, Soltech Energy Sweden AB (publ) acquired 100 percent of the shares in Tekniska lösningar i Täby AB (Tlab) with entry on July 6, 2023. The company has a turnover of approximately SEK 40 million with good profitability and has 15 employees based in Danderyd, north of Stockholm. Together with Soltech, Tlab will increase the share of solar energy in the product range and raise both turnover and profit. The acquisition is financed entirely from own cash and with newly issued Soltech shares and consolidates the Soltech Group's position in electrical engineering and solar energy.
Soltech has a clear growth strategy with acquisitions in the solar, roof, facade and electrical engineering industries. Something that builds a strong Group with cross-sector competencies. The acquisition of the electrical engineering company Tlab further establishes the group in the electrical engineering area and also strengthen Soltech's geographical presence in the Stockholm area.
Tlab is a well-established electrical engineering company and today has a turnover of approximately SEK 40 million with good profitability. Tlab's competence extend over projects and installations that includes complex and large-scale electrical and network installations, but the company also offers solar cell solutions in combination with charging and energy storage. The goal is to grow further in the renewable energy business area, where solar cell installations form the basis.
– We are now growing even more within the electrical engineering industry, which is much welcomed as solar energy requires electrical expertise with the installation. Tlab is a profitable and skilled company and already have a well-established experienced in solar energy, charging and storage solutions. This acquisition will create even more synergy opportunities between our subsidiaries, not least in the Stockholm area, and I would like to warmly welcome Jocke Persson and his team to Soltech, says Stefan Ölander, CEO of Soltech Energy.
Advanced electrical installations and solar energy
Tlab's history goes back to the 80s and the company operates in large parts of the country, although the majority of employees are based in Stockholm. For electrical installations, the company is primarily active in contracting and new installations, but also has deep expertise in more advanced solutions such as switchgear. The company's solar energy customers mainly consist of companies and smaller industrial properties, and renewable energy is a growing business area. CEO Jocke Persson therefore takes a very positive view of becoming part of the Soltech Group.
– This is a fantastic milestone for the whole of Tlab. Our customers' demand for solar energy is growing strongly and as a part of the Soltech group we will gain more opportunities to further develop our solar energy offer. Having an international Group behind us will create great advantages and we look forward to start cooperation with our sister companies, Jocke Persson, CEO at Tlab.
365zon has once again won a solar energy auction for the Netherlands' largest association for homeowners, Vereniging Eigen Huis. The winning assignment means that 365zon will install solar panels on approximately 1,000 houses during Q3-Q4 2023. The order value for the deal amounts to approximately SEK 71 million.
The Dutch solar energy company 365zon was Soltech's first international acquisition when they were acquired in April 2022. The company, with approximately 60 employees, has once again won a solar energy order for the homeowners' association Vereniging Eigen Huis. The association organizes solar energy auctions to offer its members opportunities to obtain market-leading solar energy consulting and installation services.
This means that 365zon will install solar panels on approximately 1,000 houses during quarters three and four of this year.
– I’m happy to conclude that we once again gained this trust in times of intensifying competition. This achievement reflects the dedication and hard work of our team and our will to contribute to the green transition, says Lars Buuts, CEO of 365zon.
– They once again prove that they are one of the leading companies in the Dutch solar energy market. I truly admire Lars, Levi, Arjan and their teams strong aim to create remarkable solutions that exceed their customers’ expectations, says Stefan Ölander, CEO of Soltech Energy.
On June 27, Affärsvärlden published an article about Soltech that avoids mentioning anything positive at all about Soltech's development in recent years. The writer only has a negative focus instead of a holistic perspective. The article is full of examples of deals that have been challenging for various reasons and not a single successful acquisition or deal is mentioned. The article also has a long line of own interpretations, personal attacks, opinions and facts that are purely incorrect and unprofessional. Furthermore, I was not a shareholder who stepped in in 2019, I had been chairman of the board for 7 years. I’m also the single largest shareholder, so building a castle in the air is not directly in my interest.
Since we started our acquisition strategy in 2019, Soltech has expanded greatly and in such a strategy losses are a natural part initially. It is not possible to increase turnover fortyfold without investing large sums of money. We have never tried to hide the fact that, in addition to all the successes, we have of course encountered challenges.
My view of the media is that they often do a good job by analyze different companies, and there everything negative has to be highlighted. But the media should not focus solely on highlighting the negative aspects in a subjective article. In order to provide the reader, and our shareholders, an objective picture of the company, the positive should also be highlighted. But since this part was not included in Affärsvärlden's article, I thought I would highlight some of them in the following list:
• from 2019 to 2022, we have gone from approx. 50 MSEK to approx. 2,000 MSEK in turnover. The expansion continues with a focus on profitability
• our organic growth was as much as 57% in 2022 and 66% in Q1 2023. Proof that the subsidiaries thrive and develop within the Soltech Group
• our underlying business was profitable in both Q4 2022 and Q1 2023
• approx. 30 companies have been acquired and the absolute majority have had a very good development and over 95% of all entrepreneurs have stayed in the Group
• in 2022, Soltech was established in the Netherlands and Spain via the acquisition of large solar energy companies
• our investment in solar parks has proven very successful. Recently, a deal with Solgrid was communicated with an initial order value of SEK 700-1000 million
• synergy effects between the companies are beginning to have a noticeable effect both in terms of lower prices and safer deliveries
• The solar energy industry worldwide faces an extremely positive future as governments, businesses and individuals line up to ensure cheap and green energy.
Soltech's subsidiaries conducts a fantastic job and our idea with a solar energy company as a foundation and deep competence in nearby areas such as roofing, facade and electrical technology is a unique positioning that will deliver great value in the future.
I understand that our shareholders and employees are very worried after this article and I can only refer to the positive things within our Group, of which a small part is mentioned above. We continue to build a Group with a focus on quality, profitability and growth and look forward to other articles in the future that give an overall picture of Soltech Energy.
Stefan Ölander, CEO
Borlänge-based Soltech company E-Mobility and Kläppen Ski Resort are now collaborating. An agreement between the companies has been reached which awards E-Mobility the privilege of installing solar panels and smart electric vehicle (EV) charging points for the thousands of cabin owners at the ski resort and the corporate headquarters of Kläppen Ski Resort. The order is initially valued at SEK 14 million, but can potentially amount to SEK 24 million during the contract period.
E-Mobility is the Soltech Group company with expertise in large-scale EV charging points and charging infrastructure. The company has signed a three-year agreement with Kläppen Ski Resort, Sweden's largest family-owned ski resort with 38 slopes and 21 ski lifts.
The agreement, effective as of August this year, means that E-Mobility is offering the cabin owners at Kläppen the opportunity to install solar panels and EV charging points, where E-Mobility delivers technical consultation, installation and continual support. All installations are also prepared to accommodate energy storage in the future. The company will also install solar panels and EV charging points at the planned new headquarter of Kläppen Ski Resort, expected to be finished in 2025, which will house 55 employees and provide close to 100 EV charging points.
– We are very happy to have gained the trust of a ski resort that really puts its sustainability ambitions to the test. Now we look forward to rolling up our sleeves and helping Kläppen's cabin owners get access to both smart EV charging and solar energy solutions, says Maja Pettersson, responsible for solar energy at E-Mobility.
An important service for both the climate and cottage owners
Kläppen Ski Resort has high sustainability ambitions for its operations and has previously participated in several environmental projects. Now the ski resort is taking its sustainability work to the next level through the long-term collaboration with E-Mobility, which will help cabin owners interested in sustainability reduce their environmental impact.
– We think it is extremely important to think long-term and sustainably. Sustainability work must permeate all daily work, and with E-Mobility's solutions we continue in the right direction. For us, it is a natural part to think sustainably, both in the short and above all in the long term. We are a family-owned company and for us sustainability is part of our core values and our DNA. We want to develop the company and in the future hand over a sustainable facility to the next generation Eriksson, says Gustav Eriksson, CEO of Kläppen Ski Resort.
