Good morning, and welcome to this presentation of Sweco's Q4 and year-end report. My name is Marcela Sylvander, and I'm head in communication for the Sweco Group. With us today is Sweco's president and CEO, Åsa Bergman, and CFO, Olof Stålnacke. They will take us through the results of the Q4 and also for 2022. After the presentation, we will of course open up for questions. Please, Åsa.
Welcome, everyone, to Sweco's presentation of Q4 and year-end results. Let me start by giving you a quick recap of Sweco. For those of you following our quarterly reports, you are familiar with this information. We are Europe's leading architecture and engineering consultancy. In the quarter, we surpassed 20,000 experts corresponding to a bit over 18,500 full-time employees. We are present in close to 50 markets in Europe, organized in 8 geographical business areas. We have a turnover of more than SEK 24 billion. With that introduction, let's move on to the Q4 results. We finished the year with a strong quarter result. Net sales increased to SEK 6.7 billion. We delivered strong organic growth of 8%, driven by an overall positive demand for services and increased fees. We also add 2% from acquisitions.
EBITDA increased to SEK 709 million with a margin of 10.5%. I'm very pleased with this result and the fact that we have improvements across all our business areas. Seven out of eight business areas reported organic growth, and six out of eight business areas reported margin improvements. Our financial position remains strong, and we also continue to act on opportunities in the market with new acquisitions. On the slide here, you can see one of the projects won during the Q4. We signed a new framework contract to continue our engineering activities on the metro network in Paris. We have worked on this project since 2016, and we will now continue until at least 2030.
The new metro network will connect several strategic locations in Paris, such as the regional airports and the Olympic Stadium, also save 27 million tons of CO2. Let's move to the full year result. Q4 marked a strong end to a mixed year. 2022 was a year hit by the war and all its terrible consequences. Focusing on the business side, there were uncertainties in the macroeconomic environment and, among others, a clear decline in the private and private real estate segment. We also saw a continued positive overall demand for our services with a clear uplift in areas such as energy. Net sales surpassed SEK 24 billion with organic growth of 6% for the year. EBITDA increased by 8% compared to last year with a margin of 9.2%.
We have, throughout the year, improved our organic growth through positive fee development and accelerated recruitment. We continue to execute on our acquisition agenda, having completed 2 acquisitions in Q4 and 12 acquisitions over the full year. In total, we have added close to 400 new experts to Sweco, and by this strengthened our position in strategically important segments. One of the acquisitions was Futureproofed, a Belgium climate tech firm. I will get back to the acquisitions later in this presentation. We maintained our strong financial position with a net debt/EBITDA ratio of 0.4, which is unchanged from last year. The board of directors proposes a dividend of 270 SEK. Let's now take a closer look at the market situation. As I said, the macroeconomic climate remained uncertain due to various events such as the inflation, the Russian invasion of Ukraine, and the lingering effects of the pandemic.
Despite this, the overall demand for our services remained good in the Q4, especially in the infrastructure, energy, environmental, and water segments, as well as digital services. The image you see on this slide is another example of a project we won in Q4 in Belgium based on our expertise in infrastructure. Here we will work on the reconstruction of 27 movable bridges. The project ensures the upgrade to a reliable infrastructure with optimal equipment in terms of remote control. Due to the macroeconomic situation, the demand in certain parts of private buildings and real estate continue to weaken, especially in architecture services. Altogether, we continue to see solid demand for our services, and we continue to strengthen our order book. The long-term demand, driven by trends in society connected to sustainability, digitalization, and urbanization, remains in our favor.
Now let us take a closer look at the result in the Q4. Our organic growth was 8% in the quarter, adjusted for calendar effects. We delivered positive organic growth in seven out of eight business areas. As you can see here, Norway, Denmark, Finland, Netherlands, and the UK all delivered double-digit organic growth. Sweden also delivered a strong level. The positive development is driven by an overall good demand in many sectors, combined with a positive trend in pricing and numbers of FTEs. Let us now move over to the result. EBITDA increased to SEK 709 million, which is an improvement by 30% in the quarter and equivalent to SEK 178 million adjusted for calendar effects. Denmark increased EBITDA significantly yet again and had an all-time high margin. Belgium also had positive development in the quarter compared to last year.
Sweden delivered very strong margins. Finland is now close to our financial target of 12%. We are seeing first signs of the actions taken in Q3 starting to have effect on efficiency in these business areas. In total, we improved our margins in six business areas to a total of 10.5% in the quarter. We will now dive into our acquisitions. We continue to execute on our acquisition agenda. During this year, we have acquired 12 companies, welcoming close to 400 new experts to Sweco. During Q4, we announced the acquisition of two companies, one being Via Trafik Rådgivning, Denmark's largest specialized consultancy within traffic and mobility, with some 55 full-time employees.
As I mentioned briefly earlier, in December, we acquired Futureproofed, a Belgian climate-tech firm that guides companies and cities towards a low carbon future through their software-as-a-service platform, which enables clients to measure, reduce, and report CO2 emissions. This further adds to Sweco's offering in sustainability services and digital solutions. We also kickstarted 2023 with three acquisitions, one being Belgian group VK architects+engineers, specialized in architectural, technical, and infrastructure design solutions within the infrastructure and building segments. VK is active in the Belgian market and has also presence in the Netherlands, Luxembourg, the UK, and Vietnam. The VK group has some 600 experts and an annual net sales of around 750 million SEK. The acquisition is subject to approval from the Belgian Competition Authority, with closing expected in the first half of 2023.
I will now give the floor to Olof, who will go through the numbers in more detail. Please, Olof.
Thank you, Åsa, good morning, everyone. Starting with the long-term trend on organic growth, we are slightly down versus Q3, but organic growth is still on historically high levels at 8%. Looking at net sales development with this organic growth, net sales in the quarter is SEK 6.7 billion, taking LTM net sales to SEK 24.3 billion. We see a significant negative calendar effect in the quarter from 6 less hours. Positive impact from M&A is 2%, and from FX now with the weak Swedish krona, up to 5%, bringing the total growth to 14% for the quarter. Looking at EBITDA development, EBITDA is SEK 709 million in the quarter, and LTM EBITDA thereby increasing to over SEK 2.2 billion.
EBITDA is up SEK 178 million or 30%, excluding the SEK 54 million negative impact from calendar. Looking at the EBITDA bridge by business area, we are of course very pleased to see EBITDA increases in all our 8 BAs, especially pleased with the increases we see in Sweden and Finland, showing that our actions that we talked about in Q3 have started to take effect. Denmark has shown a long-term positive trend and now has the second biggest EBITDA contribution, and again, an all-time high EBITDA margin of 15.7%. Belgium continues to maintain a good momentum. Norway grows EBITDA and increase margins. Netherlands also grows EBITDA significantly, but is slightly down in margin. U.K. and Germany and Central Europe also improve from relatively low levels in Q4 last year.
Across business areas, the drivers behind the EBITDA growth are accelerated recruitment, continued fee increases, and also an improved billing ratio. On the non-salary cost side, we continue to see increases, but the rate has slowed down significantly compared to what we saw in Q2 and Q3. Sickness absence, which had a significant negative impact in Q4 last year, was in the end actually even higher this year. However, less vacation taken brings total impact from absence to more or less zero versus last year. It's important to note that for the full year, vacation is in line with previous years. Looking then at our financial position, it remains strong with net debt at SEK 1.1 billion, slightly up versus last year. The stronger full year operating cash flow is outweighed by larger outflows for dividends and acquisitions.
Leverage is at 0.4, in line with last year and less than a fourth of our target maximum. We have available liquid assets at the end of the year of 4.9 billion SEK. With that, back to you, Åsa, to conclude.
Thank you, Olof. Let us now look at some conclusions for the quarter and the year as a whole. As previously said, it was a strong ending to a mixed year. 7 out of 8 business areas delivered organic growth, and 6 out of 8 business areas improved their margins. We have a stable inflow of orders that continue to strengthen our order book. We maintain a strong financial position, which allow us to be flexible and act on opportunities that arise. In the short term, we focus on increasing prices and our fee structure in order to mitigate salary inflation. Despite the market uncertainties, we see strong demand for our services, and I'm confident that the demand for Sweco's expertise will continue to grow as society needs to accelerate the green transition. The transition creates opportunities for us, and we are winning many new interesting projects.
Sweco is standing in the center of this transformation, and we are well-positioned to capitalize on our broad experience. We will stay on track with our strategy, keeping our leverage low to be flexible and act when opportunities arise in the market. We will maintain our diverse portfolio within segments, clients, and markets, limiting exposure to macroeconomic events. We will continue to be agile, shifting our expertise to where it is needed. Lastly, I'm proud to say that we in many aspects are leading the way together with our clients. Before we open up for questions, I would like to briefly direct your attention to the news we published yesterday concerning a contract that we signed with Nefco, the Nordic Green Bank. There are approximately or at least 6.2 million internally displaced people in Ukraine.
In response to the effects of the war, the EU has decided to finance housing, schools, preschools, and hospitals, as well as to repair infrastructure in the liberated cities in Ukraine. In the scope of this assignment, we will support the project organization when it comes to the construction of housing in six cities in Western Ukraine. The objective is to quickly meet the needs of internally displaced people with housing, heating, water, and electricity. Sweco will be collaborating with local Ukrainian consultants that we worked with in the past in this assignment. It feels incredibly gratifying that we can contribute with our expertise in a concrete manner that enables meeting people's basic needs. With that, let's open up for questions. Thank you.
Thank you, Åsa. Thank you, Olof. We will now open up for questions, and you may ask them either directly through the phone line or through the chat function. Please, Eugenia, if you could give us the instructions.
Thank you. This is the conference operator. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Dan Johansson with SEB. Please go ahead.
Thank you so much, and, good morning, Åsa and Olof.
Good morning.
Good morning.
Good morning. I think I have three questions. I'll take them one by one, if that's fine. Perhaps starting a bit, if it's possible, to state the level of price increases in the quarter or at least the split between price and volume. Is something like 50/50 a fair assumption, or was it more price increases this quarter?
I think it's fair to say that this quarter it is more volume than price increases. Price increases are slightly down versus Q3. We don't see this as any trend in the market, just that we see fluctuations between quarters. This quarter, the FT growth and volume was the strongest driver.
Perfect. Thank you for that. Also a question on the targeted actions you have had to improve utilization, which seems to have given effect here in this quarter. Are you seeing the full impact already now in Q4, or should we expect some more benefits now entering into 2023 from this?
We have started to see the impact from some of the activities that we have taken, but we have more to gain going forward.
Yeah. As we talked about in Q3, one of the areas where we are taking action is when it comes to office space, and that's obviously something you don't address in a quarter. That's ongoing work, for example. It's a good start, and we're pleased to see the first signs, as we said.
Yeah, totally agree. Makes sense. Perhaps a last question on Finland specifically. You've previously been a bit impacted by weak market there. You're saying in the report that the market remains somewhat weak, but at the same time you're growing 10% organic there in the market itself this year. Just wondering here, what explains that better performance here in Q4? Is it any major new assignments? Are you taking market shares, or what explains that turnaround that seems to be ongoing in Finland here?
If you recall, I mean, it's right that the market is still a bit weak in Finland. If you recall what happened in Q3, we talked about there was some larger project being postponed, and there was also some weak start in Finland. It's also about that, I mean, when you end up with those effects, it's really about focusing on the market, our clients, and our projects, really leaning forward and making sure that we win the project that is on the market, and that is what has happened in Finland.
Added to that, to say that we have something that is a bit of a one-off in Q4 as well in Finland. We have a SEK 10 million positive project result from an incentive structure in a large project when ending that. That's a SEK 10 million. It is connected to a customer project, but the quarterly effect is somewhat of a one-off in the quarter.
Okay. Thank you so much for that clarification.
The next question is from Johan Dahl with Danske Bank. Please go ahead.
Yes. Good morning, everyone. Just on attrition and personnel turnover, are you seeing any changes in the market there in Sweco?
I mean, we're still facing a market where there is lots of people, you know, leaving. We are succeeding with our recruitment. We are succeeding with our onboarding. I mean, we continue to focus there. You could expect that the personnel turnover will decrease a bit. What we see now is it's more stable. We need to continue to focus on that and see what it will bring going forward.
All right. Back to the question of efficiency. You talked about, you know, a lower pace of increase in sort of overhead OpEx. You know, can you help us a little bit here looking into 2023? You know, what are basically the numbers here? I mean, it's easy to get carried away here. You have some SEK 150 million Current results in the last 12 months or last 15 months from high sick leave, you know, that hasn't come back yet, if I understand you correctly, in hearing Q4. On top of that, you got this sort of OPEX decrease. In the bridge for 2023, you know, how much money are we talking about here in terms of efficiency measures? I'm not talking billing ratio.
I mean, the answer, unfortunately, will have to be that it depends a bit because we also want to continue to grow, to drive growth, as we have done in the quarter with continued high net recruitment. Of course, continue to increase fees, even that, if that shouldn't affect costs, of course. We will continue to work with the cost, but we don't want to communicate anything about the future. It's important for us. We have taken a step in terms of getting to the cost levels that we see are sustainable long term, and we're gonna continue that work. We are not given the high growth and the good profitability development. We are not in a cost-cutting mode, but we are more in a sort of getting the costs right mode.
It's difficult to put a number on it, for 2023.
On the sick leave, I mean, is that, how are you thinking about that? Is that just normal right now? Or do you think that'll be ever recovered in your view? difficult to answer, question to answer, but just how you think about that issue?
No, no, it's very clear. As I said, we had even higher sickness rate than we had in Q4 2021, and that was above levels we've seen before COVID. It's definitely still at an abnormal level, but it remains to be seen what the new normal is with the current environment. That said, I mean, you should expect it to go down at least somewhat going forward.
Just a final question. Looking at your, sort of most, cyclical parts, if you look on architecture and parts of your installation business in Sweden, for example, how far would you say that you got them into this cyclical weakness? I mean, what is your experience from previous downturns? Are we sort of approaching the middle or are you seeing some flattening out in terms of demand? Just interesting to hear your perspective there.
I mean, it's a difficult question to, I will try. First of all, one thought is that the downturn or the weakening market when it comes to housing has gone on for quite a long time. We have been able to reorganize or actually utilize the resources into different segments over the time. I think it's important to also see the whole portfolio we have and why we always talk about having this broad portfolio. Our architects and our technical installations engineers can really work towards the public buildings, toward infrastructure buildings. We can really, we can utilize the resources in a very good way. It doesn't really explain your, or as it doesn't really answer your question.
With that said, we have been able to maneuver how deep and how far we are into the kind of market situation. I really don't know. What I have experienced, we have experienced is that the different countries have a bit of a different cycles. I mean, we are staying really close, and we are making sure that we mitigate whenever we need it. We also work across countries to utilize resource in a good way. We are fortunate due to our resilient strategy or client portfolio and service portfolio that we really can work this way. I mean, you haven't seen us taking any heavier actions when it comes to reduction of personnel or anything like that.
The answer to that is that our broad portfolio gives us this opportunity.
Great. I'll get back in line. Thanks.
The next question is from Stefan Knutsson with ABG. Please go ahead.
Yes. Congratulations, Åsa and Olof, on a strong report. A question regarding price-wage balance in 2023. You talked a bit about it, but are you still optimistic about the ability to continue to raise prices, or do you think it will become more challenging this year?
First of all, good morning, Stefan, and welcome to Sweco since this is your first telephone conference with us. On the fee salary balance for 2023, as we've said before, it remains our biggest concern. It's the most important thing to focus on for us going forward. We are still. The answer to your question, we are still confident that we can make that balance, but it will require continued hard work on pricing.
Perfect. If you want to follow up, only on the one-time activation of software you had in Denmark, how large of an impact was that? Also on the impressive margin in Sweden, can you give some more flavors of drivers there and, if you think it's a sustainable improvement?
On the, on the software capitalization in Denmark, that is SEK 12 million. It should be noted, though, that even without that, it was an all-time high margin Denmark. It is a big one-off, but they are still underlying performing very strongly. On Sweden, these are the types of margin that we have seen before in Sweden. They are sort of back to where they have been historically, and the main drivers are FTE growth and also fee increases in Sweden. In terms of sustainability, we don't like to make forecasts, but it's very clear that the actions that Sweden have taken since we talked about in Q3 are having an effect. That's very positive.
Okay, perfect. Thank you very much.
Thank you.
Thank you.
The next question is from Raymond Ke with Nordea. Please go ahead.
Hi, good morning, Olof and Åsa.
[Good morning.]
Two questions from me. The first one regarding the use of sub-consultants, is it still at an elevated level where you would like to see it lower to get down to normal levels, so to speak?
It is still at an elevated level, not as high as we saw it in Q3, still at an elevated level. If you look at one of the countries that are using most sub-consultants, it's Denmark. I think it's partly an effect of the high growth and the fact that we always use sub-consultants. I don't know if you want to.
Yeah. Maybe a comment on how we think about sub-consultants. I mean, we don't have any go real targets, and we don't have a clear strategy around that because it's really about, it's really linked to what kind of types of contracts we are winning and how we put together the team to be able to really deliver and execute. It fluctuates in relation to what kind of projects we are winning and what phases we are in those projects.
Understood. Thanks for the flavor regarding that. The second question then, is it possibly that you make sure you compensate price-wise for sub-consultants so that they are, in a way, a margin drag compared to using your own people? Are they still typically, just generally speaking across the board, still, a margin drag?
That varies quite a lot, so it's difficult to say anything on average there.
I just, I mean, just an add-on comment. It's, I mean, we are focusing as much as we can on also making sure that we price ourself in the right way and think about profitability also when we take in sub-consultants. I mean, it's the whole package, so to say.
Great. That's all for me. I'll get back in line. Thank you.
Thank you.
Thank you.
The next question is from Johan Sundén with Carnegie. Please go ahead.
Thank you, operator, and good morning, Olof and Åsa.
Good morning.
Good morning.
Lots of good questions thus far. I think I had a few ones on Germany. Just take a step back, and if you can just elaborate a bit on the turnaround process in the German business, how far you have come in the kind of troubled projects that caused issues in late 2020, and how far left there is on them, and little bit more status update on German situation.
As you all know, we started the turnaround by shifting out the top management, and we have done lots of management changes. We have also worked by implementing new processes and ways of working, new revenue recognition rules. We still have some way to go due to that it takes some time when you're gonna turn around a business like this because it's really linked to capability and behaviors. It's really linked to making sure that we go to market in a way so we're quite selective on the German market, and that is the reason that you see negative growth in Germany. We do want to make sure that we actually are taking on the right kind of projects.
We are seeing some lights, and a little bit more stability. It goes quite slow, I have to say, but we are on the right way in Germany. Maybe some comments from you.
Yeah. I think we are very happy that they have stabilized on a profitable level. That being said, of course, we want higher margins over time from Germany, but it is, we want to do it the right way. We need to work out the legacy projects. As Åsa said, we need to be selective on what we take in the market. Continue moving in the right direction is what we're looking for.
The few bigger trouble projects, how much is left on those?
Well, it's a very mixed picture. Some of them are already out of the portfolio. Some have sort of either finished this year or in the coming few years. But there are, there will be some, a tail of legacy projects left for some time yet.
Great. Thanks for clarification. A second question, it's on capital allocation and M&A pipeline. We've noticed that you've been more active beginning of this year. You talked about that pricing negotiation with sellers has been a little bit tough. What's your feeling on the M&A pipeline as of now, and should we expect you to be more active, near term?
I mean, as said before, we, and as we have I mean, communicated over the years. We focus business area by business areas to create an M&A pipeline and keep relations on each market and be selective of what kind of services and how. I mean, if we get the opportunities, then we will act on those. We have seen more activity the last year due to, I think, I mean, it takes some time, so it's more of that the market has opened up. Of course, it's also connected to the market the macro economy. I mean, we will continue that work. I mean, we have an M&A pipe country by country.
As said, I mean, we have the financial strength. We also know what competencies and what companies we would like to acquire, but it takes two to tango.
Yeah. Sure. Thanks a lot for good question. Good, good answers. I get back in line.
Thank you.
Thank you.
The next question is a follow-up from Johan Dahl with Danske Bank. Please go ahead.
Yes, thanks. Just a follow-up on your Swedish infrastructure exposure. You know, there quite a lot of talk last year about, you know, very competitive tendering activity, et cetera. Are you seeing any changed behavior from the buyers in that space? Is there a change in mix towards, you know, more or less profitable areas as you go into 2023? Is this still a sort of growth area for you if you look on Sweden particularly?
Yes, it is a growth area. I have to say that the market hasn't changed that much. What we see though is that the order book we have in the infrastructure sector is good. I mean, it is. I mean, we have a potential to grow. When it comes to competitiveness on the market, I mean, it's the same. It's more about how we operate that market than how we organize ourself to be efficient enough to execute on a, I mean, profitable levels in those projects.
I think it's worth mentioning also that what we are seeing in the north of Sweden in terms of industrial projects also drives a lot of investments in other areas such as infrastructure, so that's a very strong market for us as well.
Okay. Final question just on the order book. I think you talked throughout 2022 about, you know, strengthening the order book, each and every quarter, if I'm not mistaken. Can you just put it into context where we stand today compared to, you know, one or two years ago in terms of visibility and how that order book looks in numbers?
Well, we don't give numbers on the order book, but the visibility is I would say in terms of annual turnover, it's the same as it has been. The order book has sort of over time grown with revenue. We have the same visibility in terms of annual turnover. If that makes sense.
All right. Thanks. Yeah, yeah. Thanks.
The next question is from Fredrik Lithell with Handelsbanken. Please go ahead.
Thank you. Congrats to a good report. Hope you're well. I had a question on wage drift, really. If you have seen any changes in behavior or that you have needed to move wages, in order to safeguard enough consultants in the organization? Also, if you could elaborate a little bit on what you expect in terms of the negotiations, especially in Sweden then on coming new central agreements, would be interesting to hear? Maybe if you could expand a little bit on the nice project you're participating in, the Nefco project? It would be interesting to get some more color on that. Happy news there. Thank you.
I mean, if I, if I start with the, with the, the salary inflation or the, the market when it comes to that, for us, it's about making sure that we have market based salaries, and we have a very structured process when we work with our salaries, and that we will keep. Of course, the salary inflation is a challenge for everyone in the, in the industry. We have shown, in, I mean, during 2022 that we can mitigate it with higher prices and increased prices, and that we will continue. It has really been known for us, I mean, it doesn't come as a surprise year-end that this year might be even tougher when it comes to the salary inflation.
I mean, we have really focused on this to make sure that we continue this work and even accelerating it. I think it's also worth mentioning that we have a product portfolio of 100,000 projects. The average size project in Sweco is around 25,000 EUR. We put out new prices all the time on the market, and many of our contracts has an indexation claw in our contracts. With that said, it still is a concern, as Olof said, meaning that we really need to make sure that we can price ourself in a good way.
Maybe to add to that, we haven't seen in Q4 any changes in terms of salary movements compared to earlier in the year. There is no change that doesn't change anything for 2023, but we haven't seen anything out of the ordinary in Q4.
Okay. Very clear. Thank you.
On your question around the Ukraine project. For us, for us, when the war, the invasion of Ukraine started, we had two projects ongoing in Ukraine, so we have had long relationships with Ukrainian consultants. We also had a clear view of that we would like to make sure that we position ourselves really early to make sure that we can contribute with our competence and our knowledge. We have really been there showing ourselves for Nefco as as one potential investor, but we are also showing ourselves in the different countries, making sure that we can contribute in the best way. This is, of course
It creates proudness, but it's also really a way for us to use what we have to support Ukraine. Even if I mean, I really look forward to be able to support to really rebuild the country in the future. This is a very good start, and we will focusing on making sure that we can support whatever is needed when it comes to this kind of projects. I said, there is those Ukrainian consultants that we have worked with before. We will work with them, and we will support them in this work.
Can I just follow up on that? I mean, the project starts immediately, you say. How many of your employees will be engaged in this?
It has already started. Now it's 5 people working with this project, and hopefully it will grow over time.
Okay. Thank you. Thank you.
For any further questions, you may press star and one. The next question is a follow-up from Raymond Ke with Nordea. Please go ahead.
Yeah, hi. Just, one more from me. Let's see, I lost the. If you compare the ability to deal with wage price balance in continental Europe against, let's say, the Nordics, do you notice any difference? As in, is either one more challenging for you, or do you feel that both are comparable in terms of labor market and end market demand?
I think it's all. I mean, it's, you can actually compare them. I mean, you, I mean, you might know that there are differences when it comes to how the different governments handle the inflation situation. Of course, the expectations on the different market differ. I mean, we have the same kind of structure when it comes to our contracts. We have a little bit more fixed price in this, in our countries outside Nordic countries. In those contracts, we also have in many contracts indexation clause.
I mean, the whole Sweco Model and the reason that we talked so much about implementing the Sweco Model has to do with, I mean, being close to the client, but especially it also has to do with what kind of product portfolio would you like to have, and how do you work with contract management, and what do you ensure to make profit in your project, and how do you execute your project? That goes for all countries now because we have worked really hard to make sure that we have implement the Sweco Model in the different countries. Yeah. Something to add?
I think there are differences between the countries, but there is not sort of a general difference between Nordics and continental Europe, I would say.
Okay, great. Thank you.
Marcela, there are no more questions from the conference call at this time.
Thank you, Eugenia. We have one question in the chat function, that's from Steven from Goldman Sachs. It's about Germany. I think it has been answered, there might be something you want to add to that. He writes, "Congratulations on the good result." Thank you. "Could you elaborate on the German and Central Europe division, as I've seen growth there declined?
I think we commented on that. It is working out the legacy projects. It's about being selective when we take new projects. Growth is not the first priority in Germany right now, but more getting back to stable profitability. Then long term, we are very much looking for growth in Germany, but it's not the priority right now, I would say.
Yeah. Agree.
Okay. No more questions, in the chat. Eugenia, what about you?
No questions.
Okay. We have no more questions. With that, we want to thank you for joining us, and we wish you a pleasant, nice day. Thank you so much.
Thank you.
Thank you.