At this time, I would like to welcome everyone to this HusCompagniet's full year 2025 conference call. Today's call is being recorded. If you have any objections, please disconnect at this time. All participants will be on listen only mode throughout the presentation, and afterwards there'll be a question and answer session. I will now turn the call over to speakers. You may now begin. It appears we have some technical issues. Please stand by until further notice. We should be back now. At this time, I would like to welcome everyone to this HusCompagniet's full year 2025 conference call. Today's call is being recorded. If you have any objections, please disconnect at this time. All participants will be on presentation mode. Afterwards, there'll be a question and answer session.
I'll now turn the call over to speakers. You may now begin.
Thank you for taking the time to join us. Our call today is about HusCompagniet’s full-year results for 2025. I’m Martin Ravn-Nielsen, CEO of the company, and as usual, CFO Allan Auning-Hansen is with me on this call. Let’s go straight to slide 2 for a brief overview of our 2025 performance. We continued to see a gradual market rebound from the drop in sales in 2023 and 2024, mainly in the first half of the year. Sorry, we have some technical issues here. Do you still hear us?
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Thank you. The rebound followed the overall Danish housing market, with an imbalance between supply and demand, especially in larger cities and urban areas. We maintained positive sales traction across the Danish segments, supporting a revenue lift of 29% to DKK 3 billion. Our net order book was worth almost DKK 2.3 billion at year-end. On the negative side, we faced challenges and unsatisfactory performance in semi-detached houses. This impacted profitability, which dropped to DKK 61 million, with an EBITDA margin of 2.1%. Overcoming the challenges in our B2B business is a key priority, and we are focused on returning to the core in semi-detached. We will get back to this.
On a positive note, customer loyalty remained high with our industry-leading Trustpilot score of 4.8, based on more than 7,400 reviews. This was maintained despite critical media coverage in June regarding issues with crumbling mortar joints in detached houses constructed between 2017 and 2022. We increased the number of houses sold and delivered. We celebrated the one-year anniversary of Formium, our high-end detached brand, which has been very well received. Early this year, we opened a dedicated Formium office in Aarhus to meet growing interest in exclusive, tailor-made houses in Jutland. In the same period, we reopened a dedicated showroom and office in Horsens. I’ll come back to that later.
With this introduction, let’s go to slide 3 for a few more comments on the market. The Danish economy remained solid throughout the year, supported by a high employment rate. Core inflation was around 2%, and long-term interest rates were fairly stable. However, consumer confidence worsened in 2025 after a positive trend in the second half of 2024. This continued negative perception was reflected in our detached business in the second half of 2025. KPIs improved in the first month of 2026, and we are monitoring the situation. We had hoped for less global political turmoil in 2026, but another major conflict erupted last week. We remain prepared to leverage opportunities in the market.
This means we remain cautiously optimistic for 2026, despite low visibility and continued volatility. I’ll end this slide with a broader outlook on market opportunities. At the beginning of 2026, the Danish Ministry of Urban and Rural District published a report on expected Danish housing expansion until 2034. Municipalities plan to construct 250,000 new homes, including 50,000 detached houses during this period. In Sweden, the government has proposed incentives to increase real estate transactions by offering higher loan ratios. We welcome these political incentives and look forward to contributing. Please turn to slide four for Allan’s comments on Q4 highlights.
Thank you, Martin. In Q4, revenue increased 22% to DKK 789 million, driven by all segments. The main drivers were an increased number of deliveries in detached and wooden houses, combined with higher average selling prices in the Danish segments. In addition, there was a good contribution from work in progress in semi-detached. Sales were lower across segments compared to a strong end to 2024 and impacted by the decline in consumer confidence in 2025. Gross profit came to DKK 118 million for a margin of 14.9%. Gross profit in detached and wooden houses was stable, but lower in semi-detached due to the negative effect of the challenges in the three B2B projects. The margin was positively impacted by wooden houses, but also by provisions for potential future cases related to crumbling mortar joints in detached.
Please note that the recognition of this provision relates to potential future commitments and does not reflect an increased number of registered cases in the quarter. The provision is based on a third-party evaluation, which has provided a stronger foundation for estimating the number of cases. This estimate is still subject to uncertainty. EBITDA amounted to DKK 15 million for a margin of 1.8% compared to DKK 23 million and 3.5% last year. The decline was mainly due to the development in gross profit and slightly higher staff costs following the balanced ramp-up of our organization since last year. EBIT came to DKK 1 million, down from DKK 12 million last year. Free cash flow amounted to DKK 128 million, up from -DKK 21 million last year, mainly supported by changes in working capital following a high number of deliveries at the end of the period.
Let us go to the full-year highlights on slide five. Revenue grew as expected and reached DKK 3 billion in 2025, an increase of 29%. The progress was driven by higher sales in our Danish segments, mainly in the first half of the year, and the activity level was high, and we delivered more detached and wooden houses in 2025. Gross profit was DKK 488 million with a margin of 16.5%. The increase in gross profit was driven by the detached and wooden houses segments. The detached segment was aided by slightly improved average selling prices. The margin decline was due to the negative effect of the previously mentioned challenges in semi-detached. The three challenged B2B projects will also impact profitability in 2026 and the first half of 2027. EBITDA was DKK 61 million for a margin of 2.1%.
The margin decline was caused by the same elements as the gross margin, and in addition, we had higher SG&A costs, mainly due to the balanced ramp-up of the organization in the first half of the year, combined with higher marketing costs. The ramp-up was initiated to support higher sales and execute on the increased order backlog. Following the slower Q4 sales, we adjusted the organization in January this year. Still, we do not see structural or macroeconomic indicators of a longer-term drop in sales, but as mentioned earlier, it is a volatile market we are operating in. Our main focus in 2026 will be our core business and operation. EBIT amounted to DKK 15 million compared to DKK 56 million last year. Free cash flow was stable at DKK 102 million after changes in net working capital and higher investments in the year.
Martin will now provide more insights into the changed market approach in semi-detached. Please turn to slide 6.
Thanks, Allan. After the unsatisfactory performance in the semi-detached business, we have reviewed the order portfolio and revisited our internal processes. This includes calculation, tendering, contracts, and internal cooperation, as well as collaboration with developers. We are evaluating our approach to the market and identifying ways to improve performance again, prioritizing profitability over growth. Going forward, we will return to the core of the semi-detached business and do what we are best at. This means that we will change our profile from being a contractor to being a developer focused on our own projects, B2B, and B2C. A few good and recent examples include a B2B project with PFA in Aalborg named Søgreenbakken, completed in 2025, and a recently completed B2B project in Skævinge in the north of Zealand.
We also engage in carefully selected low-complexity projects with clearly defined risk profiles and execution frameworks. We will focus on long-term partnerships with key customers. At the same time, we will look for more opportunities to build on our own land and collaborate with partners with our house concepts on their land plots. In these cases, we will be drawing on our standard principles and framework, which have proven successful in the past. We will leverage our core competence to optimize our ability to execute on the projects we engage in. We have begun improving processes across the semi-detached business to be more effective. As part of that process, we have drawn on learnings from both the challenged projects and the successfully completed projects throughout the years.
We will be financially impacted by the challenged projects in our existing order book in 2026 until the first half of 2027. With this, I will return to the 2025 developments, looking at sales, and please turn to slide 7. In 2025, total sales grew by 7% to 1,509 units, driven by progress in Danish segments. Sales in the wooden houses segment declined by 6 units. This overall sales increase was recorded in the first three quarters of 2025, while we saw a decline in Q4. This was mainly due to dampened sales after declining consumer confidence in 2025. Detached sales increased by 4% based on solid performance across the country, and we maintained a market share at the level of 17%-18%.
While the activity level remained high in larger cities and nearby areas, we noted that access to financing remains more challenging for customers in rural areas. As I mentioned at the beginning of this call, we have reopened our office and showroom in Horsens. The office marks a physical return to a key regional market. It also introduced our first new concept showroom with architectural materials and design solutions pre-presented in a structured and new way. This enabled customers to better understand the implications of their choices, including budget considerations and what it takes to build a new house. We will also, here in March, launch the new concept in a large showroom in Søborg near Copenhagen instead of the current detached showroom in Virum. About a year ago, we established FORMIUM, our exclusive brand for architect-designed premium homes.
After 12 months, the brand has proven its commercial viability and market relevance on Zealand. We have also seen rapidly growing interest from customers in Eastern Jutland, and therefore we have opened a FORMIUM office as well, with exclusive showrooms in Aarhus and have already sold several houses. The new location provides customers with a highly curated experience supported by in-house architects, engineers, construction managers, and specialist advisors. In total, we now have a dedicated strong team of more than 20 employees serving our FORMIUM concept. Semi-detached sales grew by 13%, driven by 3 larger announced projects and some smaller ones. At year-end, the projects were all unconditional, meaning that we can execute according to plans aligned with the customers.
Looking at the development in the first two months of 2026, we sold 105 units in detached, 6 semi-detached, and 10 houses in Sweden. Let's go to slide 8 for an update on deliveries. The increased sales during 2024 and early 2025 had a positive impact on deliveries, which grew by 15% to 1,031 units. The progress was driven by a 21% increase in the detached segment and a 40% increase in wooden houses. In semi-detached, the number of deliveries declined by 10%. In the first two months of this year, we delivered 77 units in detached, 0 in semi-detached, and 14 in Sweden. Please go to slide 9; Allan will take us through our order backlog.
Thank you, Martin. We continued to build our net order backlog in 2025, and it reached DKK 2.3 billion at year-end, an increase of 21%. The positive development was driven by the Danish segments. Detached accounted for 58% of the total order backlog, semi-detached 37%, and wooden houses the remaining 5%. We are pleased to note that we enter 2026 backed by an increased order backlog. We will now move on to the financial outlook for 2026. Please turn to slide 10. We saw stabilization and a gradual rebound in the house-building market last year as macroeconomic indicators remained solid. Core inflation was around 2%, and interest rates were quite stable.
Consumer confidence has actually improved slightly in recent months after declining in 2025. While the macro trends are sound, the uncertainty has still led to increased cautiousness among homebuilders in Q4 and the beginning of this year. It means that we are facing low visibility, continued volatility, and higher price sensitivity, also on the back of global geopolitical turmoil and conflicts. Furthermore, the winter season was unusually cold, causing delays in some deliveries and initiation of work. We are working on this to catch up, but we are also very focused on ensuring the customer's quality and the quality of the houses. Based on the higher order backlog, we expect moderate growth in 2026, with revenue in the range of DKK 3 billion–DKK 3.3 billion.
We assume that we will deliver between 1,000 and 1,300 houses this year. Earnings are expected to improve as well, with a 2026 EBITDA in the range of DKK 70 million–DKK 130 million. This is based on the market perspective I just highlighted, and an impact from the three challenged B2B projects which will affect profitability until the first half of 2027. In addition, we will see an effect of higher SG&A costs due to the full-year effect of the organizational ramp-up. We are monitoring inflation and costs closely and will mitigate if needed. EBIT is expected to be in the range of DKK 15 million–DKK 75 million. The EBIT level is impacted by higher depreciation following investments in new showrooms at several leased locations.
There will be no dividend distribution in 2026, and dividends are not expected to be reintroduced before our leverage is below 2 times net debt to EBITDA. With this, we want to thank you for listening in. Please turn to the next slide for the Q&A session.
If you wish to ask a question, you will need to press 5 star on your telephone. To withdraw your question, press 5 star again. Our first question comes from the line of Kristian Tornøe from SEB. Please go ahead. Your line will now be unmuted.
Yes, thank you. I have a few questions. I'll just do them one by one. Firstly, on your updated strategy for semi-detached, it sounds like you're going from a growth focus to a profitability focus. While that makes sense, I'm curious how your factories fit into this equation, because you also highlight being more selective and disciplined. I would interpret this as something which could ultimately lead to lower volumes, yet you are dependent on having optimal utilization of your factory. Can you elaborate on that balance, please?
Thank you for your question, Christian. First of all, you are correct. When we look ahead, it's more a profitability than growth focus that we clearly have in the semi-detached segment, also learning from the past year. It also means that, in terms of strategy for the factory, it will still be a supporting element to our semi-detached business. It's something we have worked on with the factory to operate on a more standalone basis and provide wholesale elements, which we already sell to various customers. We are operating the factory in a way that allows it to stand on its own while still supporting the B2B business.
Previously, it was mainly focused on supporting the B2B business, but we do see demand for wholesale elements products as well.
All right. That makes sense. Another part of your updated strategy is the focus on pursuing opportunities to build on own land. Yet, when we look at your balance sheet, the level of own land is almost unchanged versus 2024 and materially below the levels in 2022 and 2023. To what degree is your current financial leverage a challenge to accelerate that part of the strategy?
Yes, thank you again, Christian. All in all, I think regarding own land, there are various ways to get that financing in place. We are exploring different options. I also think that we have very good dialogue with the bank on these elements, which has shown support in our discussions. We have some interesting projects, especially when we look at 2027 and onwards. That's why we are going to focus more on own land, which can come in various ways.
All right. Fair enough. Then you highlight that we should expect these effects to materialize in 2028. Does this also mean that we should expect you to target an EBITDA margin of 8%–10% by 2028 in semi-detached?
I would say, in the longer run, it's still our ambition to reach that level. The three challenged B2B projects will unfortunately impact part of 2027, and from there, we consider returning toward a normal, so to say, EBITDA margin level.
Okay. The target is still 8%–10%?
Our target is still 8% to 10%. That's correct.
Good.
Chris, also, in the past, we have seen semi-detached projects on own land have better margins. Therefore, as we acquire more own land going forward, we can see another split: B2B projects, semi-detached projects, and B2C projects. Both semi-detached and B2C are integral to our business. We are also more focused on B2C going forward, as it provides higher margins.
Understood. The last topic I wanted to touch upon is the SG&A cost in Q4. It seems quite low. Usually, SG&A is higher in Q4 than Q3. In 2025, it's on par. Can you explain what happened exactly?
Yes. Basically, throughout the year, we make a provision for employee bonuses, and based on the results generated in 2025, this bonus is lower than initially assumed. That’s the primary reason.
That makes sense. Great. That was all for me. Thank you.
Yeah. Thank you, Kristian.
Next up is Sebastian Grave. Please go ahead. You are now unmuted.
Good morning, Martin and Allan, and thank you for taking my question. First, I would like to follow up on Kristian's question regarding the factory. I’m struggling to fully understand what makes you the right owner of the factory if it is not going to play an integrated part of your semi-detached strategy and has to acquire most of its volumes itself. To my knowledge, these factories have never been a strong standalone business model. At least, there is little evidence for that historically in Denmark.
Thanks for your question. The factory is still a supporting element to our semi-detached business. Looking ahead, it also supports our B2C business with the construction of roof cassettes. Historically, selling HC Elements has been a rather profitable business for the factory. There are several reasons why, from our current perspective, we still believe we are the right owner of the factory.
Okay. That’s very clear. Thank you, Allan. Then I would like to ask about detached sales trends. We've seen a slow but fairly steady recovery since 2023. Now, in the quarter, sales are down by more than 20% units-wise. Also, current trading in January and February seems somewhat soft. I know uncertainty is high, with many factors outside Denmark. Are there fundamental reasons for this slowdown? Are your overall expectations for continued recovery still in place?
Thanks again, Sebastian. Looking at Q4, as we mentioned in our Q3 financial publication, Q4 sales were lower than expected against a backdrop of greater uncertainty. Consumer confidence declined further in the second half of 2025. Lately, consumer confidence has improved over the past couple of months. From our activity and lead generation, we are more positive going forward. That said, as you recalled, it remains a very uncertain time, and only a week ago, a war in the Middle East initiated.
Looking ahead, we are slightly optimistic, but as you said, these remain very uncertain times.
Okay. Can you explain what this optimism is based on, Allan, if I may ask?
Sure. All macroeconomic indicators in Denmark are quite strong. The unemployment rate is low. Consumer confidence has declined recently. Overall, based on activity from our leads, we are more positive when looking into the coming months. Time will show, given the macroeconomic volatility we see right now. That’s our current stance.
That’s fair. One last question: you mentioned an unusually cold winter. Do you expect to fully catch up the lost activity in Q1, or is there a net negative earnings impact embedded in your 2026 guidance due to winter effects?
Over the year, we expect to catch up. In the coming quarters, we do expect a delay due to these challenges. It is very important for us to ensure high quality in the houses we deliver.
For sure. That’s very clear. Thank you for taking my questions.
Thank you.
As a reminder, press 5 star to ask a question. Our next question will be from Anders Pretzman from Danske Bank. Please go ahead. Your line will be unmuted.
Thank you very much. Hello, Martin and Allan, and thank you for taking my questions. Regarding FTEs, landing at 508 at year-end is an all-time high. You’ve adjusted it slightly. Can you indicate where we currently are on FTEs and what we should expect going forward?
I won’t go too much into details, Anders, regarding future perspectives. The 508 FTEs combine increases in both white-collar and blue-collar employees. Due to higher activity in our Esbjerg factory, blue-collar employees increased significantly. White-collar ramp-up was balanced to support increased sales and deliveries in 2026. As seen from the order backlog, which is up 20%, additional FTEs are required to support this growth.
That is the main driver behind the FTE increase. In January, we adjusted the FTE base based on the current situation, focusing strongly on our core operations.
Thank you. It seems fair to assume that your current FTE base could support significantly higher detached unit sales than currently observed. Can the current sales force sustain detached unit sales above 1,000 units per year?
No, they would not be able to do that.
Okay. That is very clear. Thank you.
In 2025, we sold 780 units. Assuming the current sales force captures an additional 200 units is unrealistic.
That is very clear. If I may, regarding provisions for the detached segment in Q4, can you clarify the size of the provision for future mortar joint remediation? Does this provision change your stance on the ongoing arbitration case?
First, no, it does not change anything. Insights from the work leading to the provision support our standing in the case. I understand the desire for more detail, but as in previous quarters, we have not decided to share specific numbers.
Okay. That’s reasonable. One last question: 2025 earnings were lumpy across segments. With your 2026 guidance, can you provide assumptions on gross margins or what you currently assume for the different segments?
Without being too concrete: the semi-detached margin in 2025 was negatively impacted by write-downs on various projects. We expect an increase in the semi-detached gross margin. In the detached segment, we expect a decrease in gross margin due to greater market pressure in Q4 than expected, and the corrective measures we implemented then will be delivered in 2026.
In general, we focus on market share in combination with profitability, and we continuously balance the two.
Thank you very much. That was all for me.
Thank you, Anders.
We have a follow-up from Kristian Tornøe. Please go ahead.
Yes. Thank you. I just want to clarify, Allan. You said you expect a lower gross margin in detached. Does that include the Q4 provision, i.e., lower than the 18.8% reported for the full year?
I expect it to be somewhere in that range, without being too concrete.
Understood. Thank you.
As no one else is lined up for questions, I’ll now hand back to the speakers for closing remarks.
We thank you for your interest in HusCompagniet. Please reach out with any follow-up questions, and have a nice day.
Thank you.