Annual and Sustainability Report 2024
Balco Group - climate-smart solutions
Balco Group AB is a market-leading group in innovative and sustainable balcony solutions and facade renovation. Under nine brands, we help our customers create safer and more pleasant homes in eight markets in northern Europe.
Balco AB was founded in 1987 in Växjö and has since developed into a group with approximately 650 employees. The Group's subsidiaries often have a local connection and are located in a large number of places in the Nordic region and northern Europe. The geographical proximity to our customers is of great importance for the Group's brands and also creates good knowledge of the market.
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2024 in numbers
1,418 MSEK
NET SALES
70 MSEK
ADJUSTED
OPERATING PROFIT
4.9 %
ADJUSTED
OPERATING PROFIT MARGIN
0.89 SEK
ADJUSTED
EARNINGS PER SHARE
CEO comments
A year of strategic acquisitions and structural transformation
2024 was a year of continued challenging market conditions for several of our companies. We strengthened our strategic position through two important acquisitions in Finland at the same time as we implemented structural changes to reduce our costs and increase our efficiency. During the year, Balco Group continued to develop new products and is at the forefront of the development of innovative balcony solutions.
Sales increased by 17% to just over SEK 1.4 billion, with acquisitions contributing 30%, while organic growth was negatively affected by the challenging market situation. Despite lower volumes, we have managed to defend profitability acceptably through good cost control, although we are not satisfied with the level, which is below our long-term targets. Our organisation has shown an ability to adapt to changing and challenging market conditions by creating creative and flexible solutions while maintaining competence in the companies.
We grow sustainably and profitably
The housing of the future needs to be adapted to urbanization, resource efficiency and quality of life. Taking into account economic, environmental and social value creation, Balco Group's strategy is based on four pillars: a long-term business model, innovation, acquisitions and entrepreneurship.
Read moreBalco Group shall be the obvious choice for balcony solutions and contribute to a better living environment.
Value creation within Balco Group
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An ageing housing stock is the basis for a growing demand for safe and innovative balcony solutions, and Balco Group currently has one of the best offers on the market, covering both standardised projects in new construction and unique solutions adapted to specific renovation needs.
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With a constant endeavour to improve products in terms of function, materials and installation process, Balco Group can offer modern products that often lay the foundation for what becomes the industry standard.
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Acquisitions are an important part of Balco Group's growth strategy and today the Group consists of nine brands, all with unique customer offerings. The Group's experience from previous acquisitions has created a clear and structured process for the successful integration and development of acquired companies.
- Balco Group places a high value on entrepreneurship. In the sectors in which the Group's subsidiaries operate, the brand is of great importance and often acts as a quality stamp.
The market
Balco Group is the market leader in the Nordic region and has a position as a challenger in other markets in northern Europe. A majority of the Group's sales come from the renovation segment, where tenant-owner associations constitute the largest customer group. Common to all geographic markets is a pent-up need to renovate an ageing property portfolio, with a large proportion of properties built between 1940 and 1980.
Net revenue by segment in 2024
In 2024, the renovation segment accounted for the majority of revenue. However, new construction grew strongly during the year due to the acquisitions of Riikku Group and Suomen Ohutlevyasennus Oy.
- Renovation (71%)
- New build (29%)
Read more about the market
Market trends
With increased interest in reducing climate impact combined with rising energy costs, more and more customers are demanding energy-smart homes. At the same time, there is great interest in balconies, patios and other solutions that create an outdoor environment directly connected to the home.
This is how Balco Group acts:
Balco Group offers glazed balconies with a documented energy-saving effect of up to 30%. Through the Group's subsidiaries, there is also a wide range of other balcony solutions and services that include facade renovation, installation of solar cells, insulation and heat recovery.
There is a high demand for balcony solutions in big cities but, due to space constraints, a smooth installation process and delivery is necessary when different suppliers have to work together in a limited space. In addition, the building permit process often takes longer due to the high demands on the character and cultural heritage of the buildings. With the right look and design of the balconies, the process can be streamlined.
This is how Balco Group operates:
As a market leader, Balco Group is well versed in building permit processes and always adapts the product design to meet local requirements. Balco Group can also carry out turnkey contracts as the Group controls the entire value chain and has its own fitters who carry out the installations. Some of the subsidiaries offer so-called city balconies that are easily adaptable to the building and aesthetically designed with the urban environment in mind.
The changed economic situation with high interest rates has contributed to housing associations and market players becoming more cautious in their decision-making processes regarding new investments. Despite this, there is an increasing need for both renovation and new production of properties.
This is how Balco Group acts:
Balco Group works actively, both in Sweden and abroad, to build long-term customer relationships. Through its subsidiaries, the Group has a strong local presence in many locations and an elaborate sales process whereby projects can be designed over time through dialogue with the customer. In recent years, the Group has implemented efficiency improvements in production, which enables the Group to quickly meet demand in the event of a change in market conditions.
CFO comments
Financial discipline in a challenging market
2024 was characterised by the integration of our acquisitions and intensive work to strengthen our operational efficiency. Our sales increased by 17 per cent to SEK 1.4 billion, with the Finnish acquisitions contributing 30 per cent. Organic growth was minus 12 per cent, mainly affected by a weaker market in Sweden and Denmark, while other markets were relatively stable, and an increase in Norway.
Despite the weaker organic growth, we have managed to maintain acceptable profitability through targeted work on costs and efficiency improvements, although this is clearly below our target but reflects our focus on balancing short-term profitability with long-term development potential.
Sustainability for Balco Group
Balco Group's sustainability work and sustainability strategy coincide with the business concept of creating innovative, sustainable and attractive balcony and facade solutions with the customer at the centre, giving people a better quality of life. The Group's products help to create a safe and aesthetically pleasing local environment that provides long-term value creation through energy savings and low environmental impact.
Sustainability initiatives 2024
- Continued development of our sustainability reporting and reporting for EU regulation in CSRD and related accounting principles in ESRS.
- As part of the work with SBTi, the Group continued to replace vehicles with electric or hybrid models in 2024 with the aim of all vehicles in the Group being fossil-free, with the exception of individual hybrid models.
- Continued development of the Group's collection of sustainability data, with a focus on Scope 3, among other things.
Key figures
MSEK |
2024 |
2023 |
|---|---|---|
| Net sales | 1 417,9 | 1 214,9 |
| Order intake | 1 376,8 | 977,0 |
| Order backlog | 1 309,3 | 1 073,6 |
| Adjusted operating profit (EBITA) | 69,6 | 89,8 |
| Adjusted operating margin (EBITA), % | 4,9 | 7,4 |
| Operating profit (EBIT) | 34,8 | 70,4 |
| Operating margin (EBIT), % | 2,5 | 5,8 |
| Profit for the year | 4,6 | 46,5 |
| Operating cash flow | 138,5 | 3,6 |
| Earnings per share, SEK, before dilution | 0,05 | 2,12 |
| Earnings per share, SEK, after dilution | 0,05 | 2,12 |
| Adjusted earnings per share, basic and diluted | 0,89 | 2,55 |