Boreo executes its capital efficiency focused strategy by exiting from SANY excavator business in Finland and Sweden
BOREO PLC Investor news 16 January 2023 at 14:00 EET
Boreo executes its capital efficiency focused strategy by exiting from SANY excavator business in Finland and Sweden
Boreo Plc and SANY Europe GmbH (“SANY”) have agreed to terminate their excavator dealership agreements in the Finnish and the Swedish markets. The existing dealership agreement for the Estonian market remains intact and HM Nordic Oü, a company part of Boreo’s Heavy Machines Business Area, continues to operate as the SANY dealer in the Estonian market. The decision of the termination follows SANY’s plans to reorganize its operations in the Nordic region and the updated strategy and strategic financial targets of Boreo published in September 2022.
“Our ambition is to own businesses with potential to deliver stable earnings growth with attractive returns on capital. While we see a great potential for growth for SANY products in the Finnish and the Swedish markets, the growth of the business requires significant investments and hence lacks the characteristic to deliver such returns on capital which we expect to be able to generate elsewhere. The initiative follows our resource allocation mindset and is well in line with our updated strategy and long-term strategic financial targets”, says Boreo CEO Kari Nerg.
“I would like to express my gratitude to our team for the good work done to establish the SANY brand to the markets. We continue with the sale, distribution and service activities in Finland and Sweden during a transition phase and ensure, in collaboration with SANY, a smooth roll-over to a new distribution structure. In Estonia, the ramp-up phase has been successful, and we have reached a meaningful market position in the country. Given the positive results and the close integration of the business with our Putzmeister operations we continue to develop the business in Estonia”, says Richard Karlsson, Head of Boreo’s Heavy Machines Business Area.
In the last 12 months ending Q3/2022, the SANY business in Finland and Sweden generated a total revenue of c. EUR 3,4 million and operational EBIT of c. EUR -0,4 million. At the end of FY22, the total net asset value attached to the Finnish and Swedish operations was c. EUR 3,0 million of which a write-off of c. EUR 0,3 million is expected and will be booked in the Q4/2022 result. The personnel engaged with the business will continue after a transition in other positions in Boreo’s Heavy Machines Business Area.
Vantaa, 16 January 2023
Boreo Plc
Kari Nerg
CEO
Distribution:
NASDAQ Helsinki Ltd
Principal media
Further information:
Kari Nerg
CEO
tel 4
Aku Rumpunen
CFO
tel 6
Boreo in brief:
Boreo is a company listed on Nasdaq Helsinki that creates value by owning, acquiring and developing small and medium sized companies in Northern Europe. Boreo's business operations are organized into three business areas: Electronics, Technical Trade and Heavy Machines.
Boreo’s main objective is to create shareholder value in the long-term. It aims to achieve this with an acquisition-driven strategy, creating optimal conditions for its businesses to increase sales and improve profitability, and by being a best-in-class home for its companies and personnel.
The Group's net sales in 2021 were EUR 122 million and it employs some 300 people in seven countries. The company’s headquarter is in Vantaa.
