NEW REJLERS ACHIEVES RECORD EARNINGS IN TOUGH TIMES
Despite a year filled with geopolitical concerns, inflation, high interest rates, and a weaker economy, Rejlers still had a strong year and continued its renewal process. In 2023, the Group had higher earnings than ever before, we made our largest acquisition to-date and we strengthened our sustainability work, all of which ensures our relevance in a market characterised by the shift to a sustainable society.
If 2022 was a really strong year for Rejlers, 2023 was more challenging in the market – but all in all, another strong financial year for us. After the first quarter of the year, the sharp inflation and rapidly rising interest rates gradually cooled down those parts of our market that are aimed at the property sector and, to some extent, the industry. In other operating areas, however, the market remained strong and possibly stronger than ever within energy, driven by the on-going transformation of the entire energy system.
All in all, 2023 was nonetheless a new strong year for Rejlers. Consolidated annual sales of SEK 4,088 million (3,513) mean a growth of more than 16 per cent, with a strong organic growth of 5 per cent. The group had earnings at a record level, with an EBITA for the full year that ended up at SEK 306.2 million (287.3). It was less positive that the margin growth did not really keep up, partly due to non-recurring costs of SEK 20 million and partly due to exposure to the crisis in the property market. The EBITA margin amounted to 7.5 per cent (8.2). The adjusted EBITA margin was 8.0 per cent.
We are continuing to work tirelessly to achieve our long-term goal of an EBITA margin of 10 per cent over a business cycle by the end of 2025. As an adjustment to the economic downturn, we unfortunately needed to lay off 75 employees in the most impacted operating areas in the fourth quarter. At the same time, we recruited in the areas that target customers within energy and infrastructure. With these measures, we are now more adapted to the prevailing market and can continue the journey towards better margins through continued focus on efficiency, leadership and higher fees.
In the 2023 financial year, we also continued to make strategic acquisitions. The bid for Swedish listed Eurocon, consolidated as of 1 April, was the largest acquisition in Rejlers’ history. In order to ensure a continued strong balance sheet in spite of the record deal, we carried out a new share issue equivalent to half of the purchase consideration in May. The belief in our ability and future potential was reflected in this issue being oversubscribed. The majority of Eurocon’s nearly 300 employees are located in northern Sweden, a fact that has given Rejlers a completely new position in the green industrial transformation taking place in northernmost Sweden. At the same time, this acquisition strengthened our offering to the process industry and our ability to carry out major projects and provide comprehensive solutions.
Rejlers has always been on the forefront in terms of technological answers to the greatest societal challenges. Today, the transition to a sustainable society is the overriding priority in both the public and private sectors. Investments are increasingly being made in new technologies and new methods to counteract the human-caused climate changes, to improve our resource efficiency and to handle waste in a sustainable manner. This means that it is a golden age for us as a technical consulting firm. Our relevance in the market is directly linked to our ability not only to actively participate in the transformation of our own operations, but also to effectively meet our customers’ growing needs for support. By serving as a catalyst in our customers’ journey towards sustainable change, we are well positioned to achieve our strategic goals of significant growth and sustainable profitability.
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In 2023, we accelerated our sustainability work. We began the year with the recruitment of Malin Ljung Eiborn as the newly appointed Sustainability Director at the Group level with a place in the Group management team. She is leading the work of transforming Rejlers into a modern, green technology consultant that supports customers in the energy transition, the industrial transformation and the necessary future-proofing of our communities. Towards the end of the year, Rejlers adopted a new sustainability strategy that includes new strategic targets. We are, among other things, in the process of setting ambitious science-based climate goals (Science Based Targets), and by 2030, we will carry out sustainability analyses of all customer projects to identify how our customers can become more sustainable. Today, being on the offensive within sustainability is a prerequisite for achieving our financial targets.
A stronger sustainability profile also helps to develop and strengthen Rejlers’ brand among both customers and current and potential employees. Our important branding efforts make it increasingly easier for us to recruit new employees in all of our countries. In Sweden, we retained our top position among the technical consultants in Universum’s ranking of the country’s best employers in 2023. As the “big, small” company, Rejlers stands out. Large enough for the most exciting assignments and large framework agreements, we are at the same time small enough for all employees to be seen and get feedback when they make their voice heard. Our employees are close to each other and can easily exchange knowledge and experiences. The vision of Rejlers as the “Home of the Learning Minds” stands for a warm and welcoming culture where no one thinks they know everything, but everyone is constantly open to learning new things. One particularly strong contribution to building our brand is our increasingly popular knowledge channel on YouTube, “Rejlers Play”, where our Head of Learning, Jesper Börjesson discusses current issues connected to community-building with interesting, high profile guests. During the year, we also successfully launched Rejlers Play in Finland.
We have continued to focus on developing leadership and improving the quality of our operating activities. The journey of change we are on is making Rejlers ever stronger. To be as present as possible as CEO, while at the same time keeping my finger on the pulse of the business, I travel out to one of our 100 offices in our four countries every Thursday-Friday. This is probably the most fun part of my job, as I get the opportunity to both listen and learn for myself and to inform employees about how Rejlers as a whole is moving forward. If I fast-forward through my visits of the past six years, I realise what an incredible journey we have made. On-site in our modern offices today, it is really possible to begin to see the new Rejlers that we envisioned when we staked out the path to 2025 once upon a time. Nowadays, you are greeted by a warm, positive and forward-looking spirit that inspires me even more to continue driving the change!
Of course, I have no crystal ball on hand, but when I look ahead, I still see that our order book is well-filled and at the same time we are better equipped for today’s market after the steps we took at the end of 2023. There continues to be great needs in the energy sector, industry and the modernisation of society. Our expertise as technical consultants with a strong focus on sustainability is timely and the chances are good for a gradually strengthened market in 2024.
Lastly, I would like to thank all our employees for their continued strong efforts in 2023. I feel that you are all affirming our journey of change towards a larger, more profitable and more learning company that serves as a catalyst for our customers’ sustainable transformation. In addition, of course, I want to thank our customers and shareholders for their continued trust, and I hope that they feel the same confidence in the future that I do. Go Rejlers!
Viktor Svensson,
President and CEO
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