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Nordic Waterproofing

Nordic Waterproofing

Protecting and waterproofing roofs

Nordic Waterproofing is a market-leading supplier of products used to protect and waterproof roofs. It was founded in 2011 as a merger of Trelleborg’s and Lemminkäinen’s waterproofing operations and was listed on OMXS Mid Cap in June 2016. The market is highly consolidated in terms of suppliers, while the customer base is fragmented. The company both supplies (through its Products & Solutions division) and installs (through its Installation Services division) waterproofing products using the materials bitumen and EPDM, but also PVC. Recent acquisitions have also been into prefabricated façade elements and green roofing products.

High barriers to entry, the price-to-weight ratio of waterproofing products benefits local players, while NWG’s economies of scale are also beneficial. Besides a strong balance sheet with plenty of attractive M&A opportunities, the core business offers a high cash flow conversion.

Bitumen and synthetic rubber costs have an impact on the company’s margin. Although the product renewal in the roofing industry is low and the pace of technology advances is small, new product introductions have historically resulted in some small provisions. Furthermore, M&A activity always brings the risk of lower than expected operational synergies and performance of acquired businesses.

SEKm 2021 2022e 2023e
Sales 3664 4189 4271
Sales growth (%) 10,9 14,3 1,9
EBITDA 474 551 528
EBITDA margin (%) 12,9 13,2 12,4
EBIT adj 382 460 440
EBIT adj margin (%) 10,4 11 10,3
Pretax profit 335 435 412
EPS rep 10,63 14,01 13,37
EPS growth (%) 0,1 31,8 -4,6
EPS adj 11,8 15,18 14,53
DPS 6 7,01 6,68
EV/EBITDA (x) 12,5 7,9 8
EV/EBIT adj (x) 15,5 9,4 9,6
P/E (x) 21 11,9 12,5
P/E adj (x) 18,9 11 11,5
EV/sales (x) 1,6 1 1
FCF yield (%) -1,1 10,6 7,5
Dividend yield (%) 2,7 4,2 4
Net IB debt/EBITDA 1,5 0,9 0,8
Lease adj. FCF yield (%) -2,4 9,4 6,3
Lease adj. ND/EBITDA 1,4 0,7 0,5
SEKm 2021 2022e 2023e
Sales 3664 4189 4271
COGS -2622 -2998 -3057
Gross profit 1041 1191 1213
Other operating items -567 -640 -686
EBITDA 474 551 528
Depreciation on tangibles -47 -48 -48
Depreciation on intangibles 0 0 0
EBITA 410 488 468
Goodwill impairment charges 0 0 0
Other impairment and amortisation -20 -20 -20
EBIT 382 460 440
Other financial items 0 0 0
Net financial items -47 -25 -28
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 335 435 412
Tax -78 -98 -91
Net profit 256 338 321
Minority interest 0 0 1
Net profit discontinued 0 0 0
Net profit to shareholders 256 338 322
EPS 10,63 14,01 13,37
EPS Adj 11,8 15,18 14,53
Total extraordinary items after tax 0 0 0
Tax rate (%) -23,4 -22,4 -22
Gross margin (%) 28,4 28,4 28,4
EBITDA margin (%) 12,9 13,2 12,4
EBITA margin (%) 11,2 11,7 11
EBIT margin (%) 10,4 11 10,3
Pretax margin (%) 9,1 10,4 9,6
Net margin (%) 7 8,1 7,5
Growth rates Y/Y 2021 2022 2023
Sales growth (%) 10,9 14,3 1,9
EBITDA growth (%) 4,6 16,3 -4,3
EBIT growth (%) 13,2 20,6 -4,5
Net profit growth (%) 1,3 31,8 -5
EPS growth (%) 0,1 31,8 -4,6
Profitability 2021 2022 2023
ROE (%) 17,9 21,8 18,7
ROE Adj (%) 19,9 23,6 20,3
ROCE (%) 16,3 18,4 16,4
ROCE Adj(%) 17,5 19,5 17,4
ROIC (%) 14,3 15,7 14,9
ROIC Adj (%) 14,3 15,7 14,9
Adj earnings numbers 2021 2022 2023
EBITDA Adj 474 551 528
EBITDA Adj margin (%) 12,9 13,2 12,4
EBITA Adj 410 488 468
EBITA Adj margin (%) 11,2 11,7 11
EBIT Adj 382 460 440
EBIT Adj margin (%) 10,4 11 10,3
Pretax profit Adj 363 463 440
Net profit Adj 284 366 349
Net profit to shareholders Adj 284 366 350
Net Adj margin (%) 7,8 8,7 8,2
Depreciation and amortisation -64 -63 -60
Of which leasing depreciation -55 -58 -64
EO items 0 0 0
Impairment and PPA amortisation -28 -28 -28
EBITDA lease Adj 406 501 478
EBITDA lease Adj margin (%) 11,1 12 11,2
Leasing payments -68 -50 -50
SEKm 2021 2022e 2023e
EBITDA 474 551 528
Net financial items -47 -25 -28
Paid tax -43 -98 -91
Non-cash items 102 -11 -28
Cash flow before change in WC 486 418 381
Change in WC -266 90 -13
Operating cash flow 220 508 368
CAPEX tangible fixed assets -77 -50 -51
CAPEX intangible fixed assets -6 -13 -13
Acquisitions and disposals -198 -19 0
Free cash flow -61 427 304
Dividend paid -244 -143 -169
Share issues and buybacks -20 0 0
Other non cash items -80 -10 0
Decrease in net IB debt 382 -89 93
Balance Sheet (SEKm) 2021 2022 2023
Goodwill 952 952 952
Indefinite intangible assets 75 65 56
Definite intangible assets 0 0 0
Tangible fixed assets 375 439 494
Other fixed assets 133 164 196
Fixed assets 1810 1872 1926
Inventories 609 519 530
Receivables 509 504 512
Other current assets 3 3 3
Cash and liquid assets 227 460 545
Total assets 3158 3358 3515
Shareholders equity 1451 1646 1799
Minority 9 9 9
Total equity 1460 1655 1807
Long-term debt 776 786 786
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 102 102 102
Other long-term liabilities 5 5 5
Short-term debt 52 52 52
Accounts payable 257 251 256
Other current liabilities 373 373 373
Total liabilities and equity 3158 3358 3515
Net IB debt 712 489 404
Net IB debt excl. pension debt 712 489 404
Capital invested 2296 2267 2335
Working capital 492 402 415
EV breakdown 2021 2022 2023
Market cap. diluted (m) 5371 4027 4027
Net IB debt Adj 677 454 369
Market value of minority 9 9 9
Reversal of shares and participations -122 -143 -171
Reversal of conv. debt assumed equity 0 0 0
EV 5935 4347 4233
Capital efficiency (%) 2021 2022 2023
Total assets turnover (%) 121,7 128,6 124,3
Capital invested turnover (%) 175,8 183,4 186,4
Capital employed turnover (%) 151,7 147,1 150
Inventories / sales (%) 11,7 12,2 12,4
Customer advances / sales (%) 7,5 8,1 7,8
Payables / sales (%) 4,9 5,5 5,9
Working capital / sales (%) 10,2 10,7 9,6
Financial risk and debt service 2021 2022 2023
Net debt / equity (%) 48,8 29,6 22,4
Net debt / market cap (%) 15,5 12,1 10
Equity ratio (%) 46,2 49,3 51,4
Net IB debt adj. / equity (%) 46,4 27,4 20,4
Current ratio (%) 197,7 219,6 233,2
EBITDA / net interest (%) 1008,1 2222,7 1884,5
Net IB debt / EBITDA (%) 150,4 88,7 76,6
Interest cover (%) 871,7 1968,7 1670,2
Lease liability amortisation -68 -50 -50
Other intangible assets 225 210 195
Right-of-use asset 116 108 94
Total other fixed assets 142 163 191
Leasing liability 111 111 111
Total other long-term liabilities 129 129 129
Net IB debt excl. leasing 566 343 258
Net IB debt / EBITDA lease Adj (%) 139,4 68,4 54
SEKm 2021 2022e 2023e
Shares outstanding adj. 24 24 24
Fully diluted shares Adj 24 24 24
EPS 10,63 14,01 13,37
Dividend per share Adj 6 7 6,7
EPS Adj 11,8 15,18 14,53
BVPS 60,25 68,33 74,68
BVPS Adj 20,72 28,8 35,15
Net IB debt / share 29,6 20,3 16,8
Share price 190,88 167,2 167,2
Market cap. (m) 4597 4027 4027
Valuation 2021 2022 2023
P/E 21 11,9 12,5
EV/sales 1,62 1,04 0,99
EV/EBITDA 12,5 7,9 8
EV/EBITA 14,5 8,9 9,1
EV/EBIT 15,5 9,4 9,6
Dividend yield (%) 2,7 4,2 4
FCF yield (%) -1,1 10,6 7,5
P/BVPS 3,7 2,45 2,24
P/BVPS Adj 10,76 5,81 4,76
P/E Adj 18,9 11 11,5
EV/EBITDA Adj 12,5 7,9 8
EV/EBITA Adj 14,5 8,9 9,1
EV/EBIT Adj 15,5 9,4 9,6
EV/cap. employed 2,5 1,7 1,5
Investment ratios 2021 2022 2023
Capex / sales 2,2 1,5 1,5
Capex / depreciation 903,3 1256,7 -1601,5
Capex tangibles / tangible fixed assets 20,4 11,5 10,4
Capex intangibles / definite intangibles 0 0 0
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 2,4 1,1 -0,8
Lease adj. FCF yield (%) -2,4 9,4 6,3

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Nordic Waterproofing - Company presentation with President & CEO Martin Ellis
Nordic Waterproofing - Company presentation with CEO Martin Ellis

Main shareholders - Nordic Waterproofing

Main shareholders Share capital % Voting shares % Verified
Svolder 16.1 % 16.1 % 30 Apr 2022
Swedbank Robur Fonder 8.0 % 8.0 % 30 Apr 2022
Handelsbanken Fonder 6.6 % 6.6 % 30 Apr 2022
Tredje AP-fonden 5.0 % 5.0 % 30 Apr 2022
Alcur Fonder 4.5 % 4.5 % 30 Apr 2022
Länsförsäkringar Fonder 4.4 % 4.4 % 30 Apr 2022
Carnegie Fonder 3.9 % 3.9 % 30 Apr 2022
Danske Invest (Lux) 3.2 % 3.2 % 30 Apr 2022
ODDO BHF Asset Management 2.9 % 2.9 % 30 Apr 2022
Avanza Pension 2.2 % 2.2 % 30 Apr 2022
Source: Holdings by Modular Finance AB

Insider list - Nordic Waterproofing

Name Quantity Code Date
Thomas Zipfel - 975 SELL 18 Aug 2021
Thomas Zipfel + 5 894 ALTM 17 Aug 2021
Thomas Zipfel + 3 929 BUY 16 Aug 2021
Mats Lindborg - 5 000 SELL 26 Jul 2021
Paul Erik Rask - 11 885 SELL 21 Jul 2021
Esa Mäki - 2 500 SELL 21 Jul 2021
Esa Mäki + 6 012 ALTM 2 Jul 2021
Martin Tholstrup + 5 925 ALTM 1 Jul 2021
Mats Lindborg + 5 943 ALTM 28 Jun 2021
Paul Erik Rask + 2 061 BUY 10 Feb 2021

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