Market conditions continue to improve compared to the previous year, although the recovery to normal conditions will take time, according to the CEO.

“It is gratifying that the important German business is stable and shows increased profitability, while it will take time before the Swedish and Finnish markets turn around,” he says.

During the second quarter, 600 homes (1,203) were settled and net sales amounted to EUR 0.21 billion (0.33). In the quarter, the operating margin amounted to 1.8 percent (5.4), while the operating gross margin was 8.9 percent (10.4).

“The gross margin in the group is weighed down by selective price adjustments to release tied-up capital in unsold homes. We meet the expected lower business volume with reduced overhead costs to the greatest extent possible and follow our plan, but indirect production costs that cannot be covered by completed and handed over project volume in the short term have a negative impact on gross profit and gross margin,” says Peter Wallin.

Bonava has reduced its gross overhead costs by 24 percent on an annual basis, which means that the company can achieve a positive operating margin for the full year 2024 despite a markedly lower expected business volume. For the first half of 2024, it was 0.6 percent.

“Profitability will increase over time when we get the impact of full cost reductions and increasing production starts,” says the CEO.

Furthermore, Peter Wallin highlights the company's focus on cash flow and reducing capital formation and reports an operating cash flow of EUR 65.6 million for the second quarter, compared to -3.1 in the corresponding period last year. Net debt decreased to EUR 0.35 billion (0.6) billion.

“The significantly lower indebtedness means lower financial costs and gives us good conditions to start projects in the future,” says Peter Wallin.