Good morning, and welcome to W5 Solutions' year-end report presentation. I am joined today with CEO Daniel Hopstadius.
Good morning.
Good morning, Daniel. Could you summarize the development of the fourth quarter?
Yes, if we summarize this, it has been a very hectic quarter. As you remember, our last quarter report, we said that we are going to make deliveries for SEK 70 million. We have overachieved, so we delivered at SEK 78 million. A great effort, and that means that this is our strongest quarter historically ever. We have also put up a new company in Finland, W5 Finland Oy, and they have also acquired parts of a company, Nastakiekko Oy. So, of course, it has been really, really hectic. So now we are a Nordic group through the creation of our Finnish subsidiary. So it has been a great but really hectic quarter.
Daniel, could you go a little bit more in depth with the financials of this fourth quarter?
I would like to start to tell about the growth. We are showing strong growth. Our revenue amounted to SEK 78 million, actually a little bit above SEK 78 million, as I mentioned before. We have a growth of 43%, and I would say most of that is also organic growth, about 85%. The profit for the quarter, measured on the EBITDA level, is SEK 8 million, and that is an increase of 233% compared to last year. If we look at the whole year, we can see we had a revenue of the year for about SEK 180 million. That is a growth rate of 25%. The profit on an EBITDA level was about 28%, from SEK 15.6 million then to SEK 20 million. If we make a conclusion of that, we had an outstanding year.
Thank you. Does the strong order intake look likely to continue?
Yes, it will continue. Sales continue to develop strongly, and we had an order intake of SEK 80 million during the quarter. This given, we get the order book a total about SEK 192 million at the end of the year. That is also an increase of 10% from the last year. If we look ahead, we can see that the demand from the customer side is increasing a lot. So we are looking for a very positive forecast for our sales.
And obviously you have grown, you have improved the profit, and you have continued to win new orders. How have you succeeded in doing this?
I would say I have to thank our wonderful, amazing team behind the delivery to our customers. Without them, this had not been possible. So we have managed to keep what we promised by being flexible, able to make quick changes in what we deliver, and very important is to make the right priorities. I would say also, we have increased costs due to the inflation and the delivery issues that still is around. We have succeeded in raising the margins. And if you see that for the future, there is improvements to make into the margins in the future.
But does not that mean you have worsened your margins?
That is absolutely right. But we have prioritized our deliveries over short-term profit in a single project. And of course that does result in decreased margins. But our ambition is to have a long-term horizon and to become an important part of the Nordic defense and support the defense capabilities. And our ability to actually be able to deliver has led us to receive two further orders from a Nordic customer within the live fire segment. So I do believe that is the right strategy to go with.
You have entered into new partnerships. Can you describe a little more closely of-
Yes. We have established a new strategic partnership with a U.S. company, Shield AI. They are leaders in autonomous drones with AI capabilities and offers one of the market's best solution to unmanned tactical flight systems. Here we have a high expectation, thanks to increased demand on this market. With them as a partner, we can deliver flight system to our customers that are well-suited to the Nordic regions. There's a harsh region, harsh environment, so they can manage to cope with the Arctic conditions.
In the report, you write that the company's well-positioned for continued profitable growth. Can you explain more about that?
Yes. It's very true that we have great possibilities for the upcoming year. We have already, as you can see, we have acquired another company, that's ArcQor AB. They are specialized in power supply. They are leaders in rugged batteries, chargers, and power banks, especially suited for extreme environments. Through this acquisition, we have also added an additional SEK 100 million into our order books into the group.
If we combine these with our numbers, we're now close to SEK 300 million in our order book. We also expect, as I mentioned before, the sales to increase. Also we could do that with increased margins. If you look for the whole year, our estimated growth is about 25% for the organic growth. If you look for total growth for the whole group, we estimate that to be approximately 75%, and that's included with the acquisitions. So with that said, we are very well positioned to keep on this growth journey.
The future, this is the end now, this is the end with quarter four, so how does the future look?
It looks bright. Due to the fact that increased readiness and rising budgets into the Western Armed Forces, we can see they have raised their budgets, and that, of course, will mean that we will sell more of our products. We are only at the beginning of our growth journey. In 2023, you will see more and better results from our investments and the initiatives we take this year. Taking into account the good development, we are, as I said before, very well positioned to reach our long-term targets. That is to reach SEK 500 million with 15% EBITDA margin at 2025.
Thank you, Daniel.
Yeah, thank you very much.