ALFVF - Alfa Laval Corporate AB (ALFVF) Q4 2023 Earnings Call Transcript
2024-02-06 11:49:06 ET
Alfa Laval Corporate AB (ALFVF)
Q4 2023 Earnings Conference Call
February 06, 2024 03:00 AM ET
Company Participants
Tom Erixon - President & Chief Executive Officer
Fredrik Ekstrom - Chief Financial Officer
Conference Call Participants
Sebastian Kuenne - RBC Capital Markets
Andrew Wilson - JPMorgan
Daniela Costa - Goldman Sachs
John Kim - Deutsche Bank
Max Yates - Morgan Stanley
James Moore - Redburn Atlantic
Alexander Virgo - Bank of America
Klas Bergelind - Citi
Mattias Holmberg - DNB Markets
Gustaf Schwerin - Handelsbanken
Sven Weier - UBS
Andreas Koski - BNP Paribas
Vlad Sergievskiy - Barclays
Anders Idborg - ABG Sundal Collier
Presentation
Tom Erixon
Good morning. Fredrik and I would like to welcome you to the Full Year 2023 Earnings Call and share some comments and reflections on the quarter and on the year.
Let me as always do a couple of introductory comments on the year. The full year 2023 was kind of a tick in the box type of year. The invoicing grew 22% to SEK64 billion, reflecting a solid order book and stable supply chains finally. Cash flow finally returned to normal conversion rates and reached SEK9 billion or three times that of last year. The Marine division started a strong margin recovery in the second half of 2023 as earlier guided and reached an 18% margin in the quarter, well in line with expectations.
And finally earlier acquisitions performed well and ahead of plans with a strong development for both Desmet and StormGeo as the prime examples. So a good year overall. In Q4, specifically demand remained sequentially stable in line with guidance and reach an invoicing record level.
Looking into 2024, we have a solid order book of SEK45 billion, SEK8 billion higher than last year. And the demand trends in the in-for-out orders looking into 2024 are a bit mixed. The transactional business in Food & Water turned positive in Q4 after six quarters of weak demand, so perhaps somewhat of an improvement ahead. And the HVAC sector turned negative in Q4 due to weak construction market and a slow heat pump market as well. So that is the preconditions as we move into 2024.
Now let me go to the key figures for 2023 as a full year. It was a solid year with all numbers improving more than 20%. We are especially pleased that EBITDA is growing faster than sales in the period with heavy investments in R&D and capacity expansion. Finally, the bottom line was really strong with earnings per share at SEK15.3, an improvement of 50% compared to last year.
The key figures for the fourth quarter specifically also had solid numbers generally better than last year. Order intake was sequentially stable and invoicing reached a new record level. The margin development was mixed and I will comment that on the divisional level....
Alfa Laval Corporate AB (ALFVF) Q4 2023 Earnings Call Transcript