Notes to the Consolidated Financial Statements
Note 1 General Information
Byggma ASA is domiciled in Norway. The head office is in Vennesla. Byggma ASA is listed on the Oslo Stock Exchange. The Group’s main area of business is the production and sale of building products to the Scandinavian and Northern European markets. In Norway, the products are sold through our own nationwide sales apparatus; abroad, sales work is handled partly by subsidiaries and partly by distributors. The product range is mainly produced by the group’s seven production units. These production units are located in Norway and Sweden. In addition to products produced within the Group, Byggma ASA also sells products for resale.
Byggma Group reports in accordance with International Financial Reporting Standards (IFRS). This quarterly report has been prepared in accordance with IFRS Standard for interim reporting (IAS 34). The report should be viewed in conjunction with the annual report for 2022 and with reference to the accounting policies specified therein. The quarterly report has not been audited.
Note 2 Tangible Fixed Assets and Intangible Assets (NOK million)
| YTD 2023 | YTD 2022 | 2022 | |
|---|---|---|---|
| Investments | 56.9 | 98.4 | 130.5 |
| Depreciations and write downs | 66.1 | 61.7 | 82.0 |
Note 3 Net Financial Items (NOK million)
| IFRS Q3 2023 | IFRS Q3 2022 | IFRS YTD 2023 | IFRS YTD 2022 | IFRS 2022 | |
|---|---|---|---|---|---|
| Change in market value, derivatives | 0.0 | 7.1 | 4.6 | 19.6 | 15.1 |
| Received (+) / paid (-) interest rate swap | 1.4 | -0.5 | 3.5 | -1.5 | 0.9 |
| Interest expenses leasing agreements | -0.8 | -0.9 | -2.5 | -2.7 | -3.5 |
| Net interest income (+) / interest expenses (-) | -23.1 | -6.1 | -66.5 | -13.0 | -35.6 |
| Other financial income (+) / expenses (-) | -0.6 | -0.9 | 0.0 | -2.0 | -2.4 |
| Net financials (income ”+” - expenses ”-”) | -23.1 | -1.2 | -60.8 | 0.4 | -25.4 |
Note 4 Share Capital (NOK million)
| Number of shares (in thousands | Ordinary shares | Share premium | Own shares | Sum | |
|---|---|---|---|---|---|
| As at 31 December 2021 | 69,819 | 18.2 | 34.6 | 0.0 | 52.7 |
| As at 30 September 2022 | 69,819 | 18.2 | 34.6 | 0.0 | 52.7 |
| As at 31 December 2022 | 69,819 | 18.2 | 34.6 | 0.0 | 52.7 |
| As at 30 September 2023 | 69,819 | 18.2 | 34.6 | 0.0 | 52.7 |
Note 5 Tax Description
For the full year, we calculate and book actual tax, while for the interim accounts we use nominal tax rates per company per country. Deferred tax/deferred tax assets are based on the tax rate in the relevant countries.
Note 6 Derivative Financial Instruments (NOK million)
| 30 September 2023 | 30 September 2022 | 31 December 2022 | |
|---|---|---|---|
| Assets | |||
| Interest rate swaps - (long-term) | 18.2 | 18.4 | 14.1 |
| Interest rate swaps - (short-term) | 2.1 | 1.8 | 1.5 |
| Forward exchange contracts - (short-term) | 0,0 | 0.0 | 0.0 |
| Total financial derivatives - assets | 20.3 | 20.2 | 15.6 |
| Liabilities | |||
| Interest rate swaps - (long-term) | 0,0 | 0,0 | 0,0 |
| Interest rate swaps - (short-term) | 0,0 | 0,0 | 0,0 |
| Share derivatives - (short-term) | 0,0 | 0,0 | 0,0 |
| Forward exchange contracts - (short-term) | 0,0 | 0,0 | 0,0 |
| Total derivative financial instruments - liabilities | 0,0 | 0,0 | 0,0 |
Note 7 Contingencies
Provisions made in the accounts based on contingent events after the balance sheet date are insignificant.
Note 8 Related Parties
CEO Geir Drangsland and related parties as at 30 September 2023 control 88,70 % of the share capital in Byggma ASA. The agreement that the Group CEO has entered into with Scanel AS is controlled by Geir Drangsland.
Note 9 Subsequent Events
There are no significant subsequent events.
Note 10 Loans (NOK million)
| 30 September 2023 | 30 September 2022 | 31 December 2022 | |
|---|---|---|---|
| Long-term loans | |||
| Bank loans | 528.1 | 441.5 | 573.4 |
| Subordinated loan from related parties | 43.1 | 0,0 | 43.1 |
| Long-term liability from sale leaseback* | 220.1 | 0,0 | 215.4 |
| Lease liabilities | 63.3 | 68.1 | 65.1 |
| Total long-term loans | 854.6 | 509.6 | 897.0 |
| Short-term loans | |||
| Overdraft facility | 192.0 | 295.0 | 90.3 |
| Bank loans | 401.5 | 463.7 | 445.3 |
| Subordinated loan from related parties | 10.8 | 0,0 | 10.8 |
| Lease liabilities | 20.4 | 19.0 | 19.1 |
| Total short-term loans | 624.7 | 777.7 | 565.4 |
| Total loans | 1479.3 | 1287.3 | 1462.5 |
* The liability from sale leaseback relates to the sale of Birkeland Eiendom AS and Masonite Fastighet AB. They were sold during the autumn of 2022. The transaction is booked as a sale leaseback in accordance with IFRS 9 as it is likely that the companies will be purchased back through a put/call structure in the autumn of 2042. The related properties are continued in the consolidated financial statements.
Byggma ASAs subsidiaries Uldal AS and Masonite Beams AB rents the related properties in Birkeland Eiendom AS and Masonite Fastighet AB respectively for their production of windows and I-Beams. The rental agreements run for 20 years and Uldal AS and Masonite Beams AB have an option to prolong the agreements for 10 years at a time after that. The rent is classified as interest expense in the consolidated financial statements.
Note 11 Segment information (NOK million)
Net Sales Revenues
| IFRS Q3 2023 | IFRS Q3 2022 | IFRS YTD 2023 | IFRS YTD 2022 | IFRS 2022 | |
|---|---|---|---|---|---|
| Panel sales to external customers | 321.1 | 348.3 | 1135.1 | 1317.8 | 1662.2 |
| Beams sales to external customers | 61.7 | 126.7 | 241.2 | 351.9 | 456.9 |
| Window sales to external customers | 62.4 | 66.3 | 203.1 | 210.9 | 291.0 |
| Lighting sales to external customers | 25.0 | 24.0 | 72.2 | 68.1 | 98.1 |
| NET SALES REVENUES FOR THE GROUP | 470.2 | 565.2 | 1651.6 | 1948.7 | 2508.2 |
Operating Profit
| IFRS Q3 2023 | IFRS Q3 2022 | IFRS YTD 2023 | IFRS YTD 2022 | IFRS 2022 | |
|---|---|---|---|---|---|
| Panels | 6.2 | 19.3 | 110.2 | 144.2 | 161.1 |
| Beams | 8.1 | 27.6 | 30.8 | 58.6 | 70.4 |
| Windows | 3.2 | 5.5 | 4.3 | 13.4 | 18.9 |
| Lighting | 1.0 | -1.1 | -2.6 | -5.8 | -6.3 |
| Real Estate | 10.8 | -8.5 | 32.2 | 13.9 | 23.5 |
| Byggma joint/eliminations | -3.8 | 73.9 | -3.6 | 62.5 | 56.9 |
| OPERATING PROFIT FOR THE GROUP | 25.4 | 116.7 | 171.3 | 286.8 | 324.6 |
Net Sales Revenues by Country
| IFRS Q3 2023 | IFRS Q3 2022 | IFRS YTD 2023 | IFRS YTD 2022 | IFRS 2022 | |
|---|---|---|---|---|---|
| Norway | 337.2 | 324.1 | 1091.4 | 1239.8 | 1607.2 |
| United Kingdom | 4.6 | 21.1 | 30.2 | 39.9 | 50.3 |
| Sweden | 72.7 | 109.3 | 295.3 | 381.5 | 492.5 |
| Finland | 2.3 | 4.7 | 8.4 | 13.5 | 17.5 |
| Denmark | 19.6 | 19.1 | 72.1 | 72.4 | 87.9 |
| The Netherlands | 16.8 | 16.8 | 69.5 | 68.1 | 92.5 |
| Other | 17.0 | 70.1 | 84.7 | 133.3 | 160.4 |
| NET SALES REVENUES FOR THE GROUP | 470.2 | 565.2 | 1651.6 | 1948.7 | 2508.2 |
Note 12 Associated Company (NOK million)
| Norske Skog ASA Q3 2023 | Norske Skog ASA YTD 2023 | |
|---|---|---|
| Interest held as at 30 September 2023 | 18.49 % | 18.49 % |
| Treasury Shares in Norske Skog ASA as of 30 September 2023 | 6.82 % | 6.82 % |
| Real interest held as at 30 September 2023 | 19.85 % | 19.85 % |
| Income statement and statement of comprehensive income | 0,0 | 0,0 |
| Operating revenues | 3,036.0 | 9,760.0 |
| EBITDA* | 327.0 | 1,382.0 |
| Profit (loss) after tax | 134.0 | -1.0 |
| Other comprehensive income | -176.0 | 258.0 |
| Total comprehensive income | -42.0 | 257.0 |
| Share of profit (loss) before tax (from 09.03.2023) | 26.6 | 19.2 |
| Gain related to reverse dilution | 27.3 | 27.3 |
| Bargain purchaase | 0,0 | 0,0 |
| Share of profit (loss) from associate in P&L | 53.9 | 46.5 |
| Share of other comprehensive income (from 09.03.2023) | -34.9 | 8.4 |
| Share of comprehensive income (from 09.03.2023) | 19.0 | 54.9 |
*EBITDA as defined in Norske Skog ASA Alternative Performance Measures
| Balance sheet | 30 September 2023 |
|---|---|
| Non-current assets | 8,790.0 |
| Current assets | 5,109.0 |
| Non-current liabilities | 5,607.0 |
| Current liabilities | 2,411.0 |
| Net assets (total equity) | 5,880.0 |
| Share of net assets (total equity) | 1,166.9 |
| Goodwill | 51.5 |
| Carrying amount as at 30 September 2023 | 1,218.2 |
| Bridge Associated Company YTD | 2023 |
|---|---|
| Financial investment 1 January 2023 | 1,078.0 |
| Addition financial investment in Q1 2023 | 63.9 |
| Gain (+) / loss (-) on financial investment (1 January 2023 - 9 March 2023) in other comprehensive income | -11.0 |
| Financial investment 9 March 2023 | 1,131.0 |
| Recognition of Norske Skog ASA as associated company 9 March 2023 | 1,131.0 |
| Purchase of additional shares | 23.2 |
| Recognition of gain related to bargain purchase | 9.3 |
| Share of comprehensive income (from 09.03.2023) | 54.9 |
| Carrying amount of Norske Skog ASA as at 30 September 2023 | 1,218.2 |
| Carrying amount of Lim og Platetransport AS as at 30 September 2023 | 0.1 |
| Carrying amount as at 30 September 2023 | 1,218.3 |
Byggma ASA was considered to have significant influence in Norske Skog ASA as of 9 March 2023. On 9 March 2023 the CEO of Byggma, Geir Drangsland, was elected chairman of the board in Norske Skog. The Geir Drangsland also controls Drangsland Kapital AS which owns 5.64% of Norske Skog. Before 9 March 2023 the investment in Norske Skog was classified as financial investment in Byggma’s consolidated financial statement. From 9 March 2023 the investment in Norske Skog ASA is treated as an associated company as per the equity method in accordance with IAS 28.
CEO in Byggma, Geir Drangsland, is CEO in Norske Skog with effect from 1 September 2023. Simultaneously he resigned as Chairman of the board in Norske Skog. Geir Drangsland has informed the board in Byggma that that he will resign as CEO in Byggma. The process of hiring a new CEO is started and the plan is to employ a new CEO in Byggma in the beginning of 2024.
Byggma group owns 20 % of the company Lim og Platetransport AS which owns and operates trucks that transport glue and panels for Forestia AS. Lim og Platetransport AS has a carrying amount of NOK 82.800 in Byggma’s balance and YTD the share of profit is NOK 32.700.