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Björn Strömberg
CFO
+46 (0)31 721 03 05
Contact me

Kristina Ekeblad
Investor Relations Manager
+46 (0)704 130 926
Contact me

Semcon as an investment

Growing need for digitalisation and sustainable, innovative solutions creates excellent growth opportunities for Semcon. The combination of digital excellence and advanced engineering skills forms a unique offering, while the strategic shift in recent years of the offering, customer portfolio and business model has further strengthened Semcon’s position in the market. Strong profitability and financial position offer the right conditions for continued profitable growth.

1. Growing need for technology

Strong macro trends support the high demand for innovative technology. The need for a sustainable and digital transition is clear in all industries and investments in new technical solutions, such as digitalisation, electrification, autonomous applications, AI and other disruptive technologies, is expected to rise sharply in the years ahead. This will often take place through prioritised and less cyclically sensitive initiatives. Many companies need to make the transition to achieve the sustainability targets that they are increasingly setting, which boosts demand for climate-smart technology development for products and production as well as new aftersales solutions. Concurrently, the time to market for new, often more complex technology is shorter than ever, which further increases the need for Semcon’s services.

2. Increased focus on service and aftermarket solutions

As customers increasingly prioritise a more efficient service and aftersales business, demand is on the rise for digital product information and learning, an area where Semcon’s offering is at the forefront worldwide. More than 75 per cent of sales from the Product Information business area comprise solution-based deliveries and functional sourcing, which create a good foundation for long-term and profitable cooperation. This percentage is expected to increase further given a strengthening outsourcing trend as the need for specialist expertise grows in combination with a tendency among customers to streamline their operations.

3. Unique combination increases value creation

In contrast to companies specialising in either IT or engineering, Semcon can offer its customers both: a unique combination of digital services and advanced product and production development. Integrated solutions create the conditions for higher value for customers and improved growth and efficiency for Semcon. This also entails greater relevance for a broader customer base, from traditional technology development to the latest AI solutions.

4. Broad customer portfolio provides stability

A broad customer portfolio helps to spread risk and increase stability across cyclical fluctuations. Semcon’s broad industry presence also allows it to balance available expertise on the basis of demand and profitability, which produces long-term and less cyclically sensitive partnerships. High-tech expertise from the automotive industry is increasingly in demand from other industries that are facing comprehensive sustainability and digitalisation challenges.

5. Inspired and safisfied colleagues

The combination of Semcon’s international cutting- edge expertise and the diversity of its perspectives creates the conditions for smart solutions that put people and the planet first. It creates satisfied users, which means both customers and Semcon become more competitive and profitable. The foundation for creativity and innovation is inspired colleagues who enjoy their work – and Semcon’s attractiveness as an employer is crucial for long-term success. Customer satisfaction and employee commitment are at record levels.

6. High profitability and strong financial position

Over the past five years, Semcon’s profitability has almost doubled and was 10.4 per cent (EBITA) in 2021. Cash flow has also been strong and the Group’s financial position is good with net cash of SEK 214 million on 31 December 2021. In 2021, the Board adopted new financial objectives for Semcon and the Group now aims to grow sales by 10 per cent per year, through a combination of organic growth and acquisitions, while EBITA margin is to reach at least 10 per cent. Healthy profitability and the strong balance sheet form a stable foundation for further growth.

7. Long-term value creation

Semcon’s operations are positively affected by the transition to sustainable and digital solutions and create value for end users and employees, customers, shareholders and society as a whole. Over the past five years (2017–2021), the share price for the Semcon share has risen 176 per cent, compared with 94 per cent for OMX Stockholm PI. Total return for the Semcon share during the same period was 225 per cent, compared with 126 per cent for OMX Stockholm GI.

Contact

Björn Strömberg
CFO
+46 (0)31 721 03 05
Contact me

Kristina Ekeblad
Investor Relations Manager
+46 (0)704 130 926
Contact me

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