1. Growing need for technology
Investments in new technology, such as digitisation, electrification, autonomous applications and AI, are expected to rise by 15–25 per cent per year in coming years – often through prioritised and less cyclically sensitive initiatives. At the same time, the outsourcing trend will strengthen as the need for specialist expertise grows in combination with a tendency among customers to streamline their operations.
2. Increased focus on service and aftermarket solutions
As customers increasingly prioritise a more efficient service and aftermarket business, demand is on the rise for digital product information, an area where Semcon’s offering is at the very forefront worldwide. More than two-thirds of sales of the offering comprise Managed Service contracts, which create a good foundation for long-term and profitable cooperation – a share that is expected to grow further.
3. Unique combination produces broader customer base
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. This entails greater relevance for a broader customer base, from traditional technology development to the latest AI solutions. Integrated solutions create the conditions to improve growth and efficiency and to reduce costs for the customers.
4. Greater industry differentiation
Semcon’s broad industry presence allows it to balance available expertise based on where demand and profitability is most advantageous. This creates long-term and less cyclically sensitive partnerships. High-tech expertise from the automotive industry is increasingly in demand from other industries, which are facing comprehensive digitisation challenges.
5. Inspiring colleagues the basis of profitable growth
The combination of Semcon’s international cutting-edge expertise and the diversity of its perspectives create the conditions for smart solutions that put people in the spotlight. It creates satisfied users, which means both customers and Semcon become more competitive and profitable. Customer satisfaction and employee commitment are at record levels.
6. Strong financial position
Since 2015, Semcon has doubled its operating margin and is nearing its profitability target of 8 per cent per year. Its strong balance sheet forms a stable foundation for organic growth and acquisitions. Over the past three years, dividends paid to shareholders have averaged 67 per cent of earnings per share. Own shares have also been frequently repurchased since 2017. Earnings per share rose 31 per cent in 2018 to SEK 5.25 (4.00). Earnings per share rose 18 per cent on a rolling 12-month basis to SEK 5.78 (4.88) on 30 September 2019.