Inside information, profit warning: Sitowise lowers its full year net sales and adjusted EBITA margin (%) guidance, and provides preliminary key figures for the second quarter
Sitowise Group Plc Stock Exchange Release 31 July 2024 at 19.15 (EEST)
Sitowise revises its full year net sales and adjusted EBITA margin (%) guidance downward due to a significantly weaker than anticipated second quarter performance and rest of the year outlook in its Sweden business area, as well as a delay in the recovery in construction market activity in Finland and Sweden.
New guidance:
Sitowise Group’s net sales is expected to decline in 2024, driven by the Buildings business decline and weakened growth outlook in Sweden for the second half of the year. In year 2024, the adjusted EBITA margin (%) is expected to be lower than in 2023.
Previous guidance (issued on 27 February 2024 and repeated on 8 May 2024)
Sitowise Group’s net sales is expected to slightly decline in 2024, driven by the Buildings business decline. Adjusted EBITA margin (%) is expected to be at the 2023 level or above in 2024.
Background for revising guidance
Sitowise's Infra and Digital Solutions business areas continued their strong performance in the second quarter of 2024. The outlook for these two business areas, which together represent approximately one half of the Group’s business, remains good.
The Group’s second quarter net sales development and profitability were burdened especially by a significantly weaker than anticipated performance in its Sweden business area, caused by certain project overruns and insufficient workload. The workload was adversely impacted by continued low order intake and delays of certain project starts. Furthermore, given that temporary layoffs are not possible in Sweden, balancing actions take more time. The order backlog in Sweden is currently on an insufficient level and the challenges are expected to continue into the second half of the year.
The materialization of central banks’ anticipated interest rate cuts has been slower and more moderate than expected, which has delayed market recovery in the Buildings business area.
The stable long-term growth in the demand for Sitowise’s design, consulting, and digital services is supported by megatrends such as urbanization, renovation backlog, sustainability, digitalization and security. We are seeing signs of bottoming out and gradual recovery in construction market and expect growth to materialize in greater scale in 2025.
Preliminary key figures for April–June 2024
| M€ | 4-6/2024 prel. | 4-6/2023 | 1-6/2024 prel. | 1-6/2023 |
| Net sales | 50.9 | 56.5 | 102.4 | 112.5 |
| Adj. EBITA | 2.6 | 4.5 | 5.9 | 11.1 |
| margin (%) | 5.0% | 8.0% | 5.8% | 9.9% |
Sitowise will publish its Interim Report for January–June 2024 on Tuesday 13 August 2024 at 8.30am (EEST). There will be a webcast for analysts, media and investors at noon (EEST) on the same day.
Sitowise Group Plc
Board of Directors
Additional information:
Hanna Masala, CFO, Sitowise Group Plc, tel. +358 40 558 1323
Distribution:
Nasdaq Helsinki
Major media
www.sitowise.com
About Sitowise
Sitowise is a Nordic expert in the built environment with strong focus on digitality. We provide design and consulting knowhow to enable more sustainable and smarter urban development as well as smooth transportation. Sitowise offers services related to real estate and buildings, infrastructure, and digital solutions both in Finland and in Sweden. Global megatrends drive huge changes that require a re-evaluation of the smartness in the built environment – therefore we have set our vision to be Redefining Smartness in Cities. The Group's net sales were EUR 211 million in 2023 and the company employs more than 2,100 experts. Sitowise Group Plc is listed on Nasdaq Helsinki under the trading symbol SITOWS.
