Report on first quarter of 2024
for ROCKWOOL A/S
Release no. 23 – 2024
to Nasdaq Copenhagen
Earnings call
ROCKWOOL Group will host an earnings call on 16 May 2024 at 11.00 CEST. The call will be transmitted live on
www.rockwool.com.
1/13
15 May 2024
Positive sales momentum and strong profitability in challenging
markets
Highlights
▪ Sales in Q1 2024 totalled 918 MEUR, an increase of six
percent in both local currencies and reported figures
compared to a weak quarter last year.
▪ EBITDA in Q1 2024 reached 216 MEUR, an increase of 32
percent in reported figures compared to Q1 2023. The
EBITDA margin was 23.5 percent, up 4.6 percentage points
from last year. Higher volume, stable overall pricing combined
with productivity gains and cost savings ensured a
satisfactory earnings level.
▪ EBIT amounted to 152 MEUR in Q1 2024, an increase of 46
percent, with a 16.5 percent EBIT margin, up 4.5 percentage
points from Q1 2023. EBIT includes a 6 MEUR provision for
donations to the Foundation for Ukrainian Reconstruction
compared to 13 MEUR in the same period last year.
▪ Investments totalled 84 MEUR in Q1 2024, including the
finalisation of the electrification of the factory in Flumroc,
(Switzerland).
▪ Annualised return on invested capital reached 21 percent, up
from 16 percent in Q1 2023, primarily due to increased
earnings.
▪ Shareholders may from 15 May 2024 until 30 May 2024
request conversion of A shares to B shares. For further
information please refer to
https://www.rockwool.com/group/about-
us/investors/conversion-shares/.
▪ At the end of March 2024, the company had purchased
105 900 B shares under the share buy-back programme for a
total amount of 31 MEUR.
Outlook 2024
▪ Sales growth of around mid-single-digit percent in local
currencies.
▪ EBIT margin around 15 percent.
▪ Investment level around 375 MEUR excluding acquisitions.
“First quarter sales rebounded satisfactorily, up six
percent, and earnings were strong, up 46 percent.
Prices have remained broadly stable during the
quarter, with demand remaining solid in North America
and parts of Asia. The Insulation segment performed
well overall on sales and earnings, whereas
performance was more challenged in the Systems
segment. I am pleased that we successfully started up
our new green energy technology in Switzerland – the
biggest stone wool electric melter in the world. Looking
ahead, we are carefully optimistic that we will see
improved conditions in the industrial construction
sector. We are encouraged by the EU’s adoption of the
Energy Performance of Buildings Directive, which over
time will increase the rate of building renovations and
thus demand for insulation”.
CEO Jens Birgersson
2/13
Main figures / key figures for the Group
Unaudited
Audited
Q1 2024
Q1 2023
FY 2023
Income statement items in MEUR
Net sales
918
866
3 620
EBITDA
216
164
779
Amortisation, depreciation and impairment
64
60
261
EBIT
152
104
518
Profit before tax
155
106
522
Profit for the period
116
78
389
Balance sheet items in MEUR
Non-current assets
2 383
2 311
2 361
Current assets
1 278
1 295
1 193
Total assets
3 661
3 606
3 554
Equity
2 881
2 616
2 804
Non-current liabilities
216
216
199
Current liabilities
564
774
551
Net interest-bearing cash / (debt)
209
-50
239
Net working capital
438
510
358
Invested capital
2 670
2 671
2 562
Cash flow items in MEUR
Cash flow from operating activities
99
65
707
Cash flow from investing activities
84
77
312
Free cash flow
15
-12
395
Others
Number of full-time employees (end of period)
12 017
12 033
11 993
Ratios
EBITDA margin
23.5%
18.9%
21.5%
EBIT margin
16.5%
12.0%
14.3%
ROIC (rolling 4 quarters)
21.2%
15.8%
20.1%
Return on equity (rolling 4 quarters)
15.5%
11.4%
14.4%
Equity ratio
78.7%
72.6%
78.9%
Stock market information (DKK)
Earnings per share
40
27
134
Cash flow per share
34
23
244
Book value per share
994
901
967
Share capital (million)
216
216
216
Price per A share
2 234
1 673
1 965
Price per B share
2 260
1 677
1 977
Market cap (million)
48 236
36 112
42 519
Number of own shares
166 188
62 857
50 288
For definition of key figures and ratios see page 84 in the ROCKWOOL Group Annual Report 2023 available on our website: www.rockwool.com/.
3/13
Management report for the period
1 January to 31 March 2024
General update
In the first quarter of 2024, higher volume, stable overall pricing combined with
productivity gains and cost savings ensured a satisfactory earnings level. The
increase in volume that started in Q4 2023 continued in Q1 2024, driven by the
Insulation segment.
Many European markets remained at a low activity level due to a subdued
residential construction industry, a decline in building permits, and high building
costs driven by high interest rates and inflation. The North American economy
is stronger and growing well, and our factories there are now running at full
capacity, reflecting the high demand and our efforts to reduce lead times. In Q1,
the Board approved a land purchase in Washington state, with the intention to
build a third manufacturing facility in the United States. Volume increased
solidly in South Asia, driven by strong demand.
Global sales development
In Q1 2024, ROCKWOOL Group generated net sales of 918 MEUR, an
increase of six percent in both local currencies and reported figures compared
to Q1 2023. The increase in sales was driven by higher volume but were
adversely affected by product mix. Sales price decreases in the last part of
2023 resulted in slightly decreased sales prices versus Q1 2023. However,
sales prices have in aggregate remained stable since the beginning of the year.
Regional sales development
In Q1 2024, sales in Western Europe amounted to 525 MEUR, down one
percent measured in both local currencies and reported figures. Sales
decreased in important markets like France, the Netherlands, and Denmark. On
the upside, Germany and Italy had a good quarter with increased sales
compared to the same quarter last year.
In Eastern Europe, sales for the first quarter of 2024 amounted to 176 MEUR,
an increase of 30 percent in local currencies and 28 percent in reported figures.
Sales increased in all countries in the region except for Czechia, and many
markets experienced double-digit sales growth in the quarter.
In the rest of the world, first quarter sales reached 217 MEUR, an increase of
11 percent in local currencies and nine percent in reported figures. The
increase in sales was driven primarily by North America, while key markets in
Asia like Malaysia, India, and Japan reported double-digit sales growth
compared to last year.
Group sales
+6%
Sales in Western Europe
-1%
Sales in Eastern Europe
+30%
Sales in rest of the world
+11%
4/13
Regional sales
MEUR
Group profitability
In Q1 2024, EBITDA increased 32 percent to 216 MEUR resulting in an
EBITDA margin of 23.5 percent compared to 18.9 percent for the same period
last year. The margin recovery was driven by volume growth, stable sales
prices combined with capacity agility, and increased production efficiency as
well as lower raw material prices compared to Q1 2023.
First quarter EBIT increased 46 percent, reaching 152 MEUR, corresponding to
an EBIT margin of 16.5 percent compared to 12.0 percent for the same period
last year. The result for Q1 2024 includes a 6 MEUR provision for a donation to
the Foundation for Ukrainian Reconstruction compared to the 13 MEUR
donation in the same period last year. The remaining part of the shareholder
approved donation of 100 MDKK will be expensed during Q2.
EBIT & EBIT margin
MEUR
Net financial items ended positive at 3 MEUR for Q1 2024. A small unrealised
exchange rate gain of 0.2 MEUR was recognised in Q1 2024 mainly related to
528
525
138
176
200
217
0
200
400
600
800
1 000
Q1 2023 Q1 2024
Western Europe Eastern Europe and Russia North America, Asia and others
EBITDA
+32%
EBIT
+46%
EBIT margin
+4.5%-points
102
131
68
101
104
133
146
135
152
0
20
40
60
80
100
120
140
160
Q1 Q2 Q3 Q4
2022 2023 2024
11.0%
10.5%
12.0%
14.5%
14.4%
23%
16%
61%
57%
19%
24%
16.2%
12.9%
16.5%
6.8%
5/13
the foreign currency exposure on the intercompany balance between
ROCKWOOL A/S and our subsidiary in Russia.
The effective tax rate was 25.5 percent for Q1 2024, up 0.5 percentage points
from the same period last year and unchanged from full year 2023.
Net profit for the first quarter of 2024 amounted to 116 MEUR, which is 38
MEUR higher than in the same period last year.
Balance sheet
Net working capital ended the first quarter at 438 MEUR, an increase of 80
MEUR compared to year-end 2023 and a decrease of 72 MEUR compared to
Q1 2023. Increased sales volume and lower input costs kept inventory levels
low. Higher trade receivables from the growth in sales was partly offset by
higher trade payables as production activity in the factories increased. The net
working capital ratio ended at 11.9 percent, 1.4 percentage points below the
same period last year.
Due to higher four quarter rolling EBIT, annualised return on invested capital
increased to 21.2 percent compared to 15.8 percent for the same period last
year.
At the end of Q1 2024, total assets amounted to 3661 MEUR, an increase of
107 MEUR compared to year-end 2023 and 55 MEUR compared to Q1 2023.
The increase was mainly a combination of higher ongoing investments offset by
lower inventories due to higher sales and lower input costs.
At the end of the period, the equity ratio remained solid at 79 percent.
Cash Flow
Cash flow from operations before financial items and tax amounted to 135
MEUR for the first quarter of 2024, compared to 87 MEUR in the same period
last year. Operations continued to generate solid cash flow, and the negative
impact from the change in net working capital was at level with last year.
In Q1 2024, capital expenditure excluding acquisitions was 84 MEUR compared
to 77 MEUR in the same period last year. The sustainability investment for
conversion to electrical melter in Flumroc (Switzerland), additional production
capacity and automation in Bohumín (Czechia), new Rockpanel capacity in
Roermond (Netherlands) and the additional Grodan capacity in Toronto
(Canada) were the largest individual projects.
Free cash flow was 15 MEUR in Q1 2024 compared to -12 MEUR in the same
period last year.
Cash flow from financing was -47 MEUR mainly from purchase of own shares
in relation to the share buy-back programme, compared to 139 MEUR in the
same period last year due to drawings on our credit facilities.
ROIC
+5.4%-points
Operational cash flow before
financial items and tax
+48 MEUR
Free cash flow
+27 MEUR
6/13
The Group’s financial situation remains solid with a net interest-bearing cash
position of 209 MEUR and unused credit facilities of 600 MEUR.
Business segments
Sales per business
MEUR
Key figures Insulation segment
MEUR
Q1 2024
Q1 2023
External net sales
724
664
EBIT
124
79
EBIT margin
15.4%
10.4%
In Q1 2024, Insulation segment sales reached 724 MEUR, which is an increase
of nine percent measured in both local currencies and reported figures
compared to first quarter last year. The increase was mainly related to higher
volume especially in Eastern Europe, North America and South Asia.
EBIT in the Insulation segment was 124 MEUR resulting in an EBIT margin of
15.4 percent in Q1 2024, up 5.0 percentage points. Based on our commitment
to support reconstruction activities in Ukraine, a provision of 6 MEUR for
donation to the Foundation for Ukrainian Reconstruction was recognised in the
Insulation segment in Q1 2024 compared to 13 MEUR in the same period last
year.
724
664
724
807
723
796
711
707
694
200
202
194
211
194
214
192
248
240
0
200
400
600
800
1 000
1 200
Q1 Q2 Q3 Q4
866
Insulation sales
+9%
Insulation EBIT margin
+5%-points
Systems
Insulation
924
1 018
917
1 010
955
934
903
918
7/13
EBIT per business
MEUR
Key figures Systems segment
MEUR
Q1 2024
Q1 2023
External net sales
194
202
EBIT
28
25
EBIT margin
14.2%
12.4%
Systems segment sales amounted to 194 MEUR in Q1 2024, which is a
decrease of four percent in local currencies compared to Q1 2023. Sales
decreased in Rockfon, Rockpanel, and Lapinus while Grodan performed well in
the quarter.
Systems segment generated an EBIT of 28 MEUR, which is 3 MEUR or 10
percent above last year. The EBIT margin was 14.2 percent, up 1.8 percentage
points compared to Q1 2023.
Conversion of shares
In accordance with ROCKWOOL’s articles of association, shareholders may
from 15 May 2024 (as per this announcement) until 30 May 2024 request
conversion of A shares to B shares. Further information on how to submit a
conversion request and on the terms and conditions can be found on the
company’s website:
https://www.rockwool.com/group/about-us/investors/conversion-shares/.
Share buy-back programme
As stated in the 2023 Annual Report, ROCKWOOL Group has initiated a share
buy-back programme of up to 160 MEUR. The share buy-back programme will
run from 8 February 2024 until 7 February 2025. During this period, the
Company will buy own shares for up to a maximum of 160 MEUR. At the end of
March 2024 the company had purchased 105 900 B shares under the
programme for a total value of 231 MDKK or 31 MEUR.
79 79
124
110 110
52
118
71
124
23
25
28
21
23
16
28
30
11
0
20
40
60
80
100
120
140
160
Q1 Q2 Q3 Q4
Systems sales
-4%
Systems EBIT margin
+1.8%-points
Systems
Insulation
102
104
152
131
68
101
135
133
68
146
8/13
Outlook for the full year 2024
▪ Sales growth of around mid-single-digit percent in local
currencies.
▪ EBIT margin around 15 percent.
▪ Investment level around 375 MEUR excluding acquisitions.
2024 outlook overview
7 February 2024
3 May 2024
15 May 2024
Net sales
in local currencies
Sales roughly at the
same level as in 2023
Sales growth of around
mid-single-digit percent
Sales growth of around
mid-single-digit percent
EBIT margin
Around 13 percent
Around 15 percent
Around 15 percent
Investments excluding acquisitions
Around 375 MEUR
Around 375 MEUR
Around 375 MEUR
Further information:
Kim Junge Andersen, Chief Financial Officer
ROCKWOOL A/S
+45 46 56 03 00
At ROCKWOOL Group, we are committed to enriching the lives of everyone who
experiences our products and services. We help our customers and communities tackle
many of today’s biggest sustainability and development challenges, from energy
consumption and noise pollution to fire resilience, water scarcity and flooding. Our
product range reflects the diversity of the world’s needs, while supporting our
stakeholders in reducing their own carbon footprint.
Stone wool is a fully recyclable, versatile material that forms the basis of all our
businesses. With approximately 12 000 dedicated colleagues in 40 countries and sales
in more than 120, we are the world leader in stone wool products, from building
insulation to acoustic ceilings, external cladding systems to horticultural solutions,
engineered fibres for industrial use to insulation for the process industry and marine &
offshore.
9/13
Management statement
15 May 2024
Registered Directors
Board of Directors
10/13
Income statement
Unaudited
Audited
MEUR
Q1 2024
Q1 2023
FY 2023
Net sales
Other operating income
Operating income
Raw material costs and production material costs
Delivery costs and indirect costs
Other external costs
Personnel costs
Operating costs
EBITDA
Amortisation, depreciation and impairment
EBIT
Income from investments in associated companies
Financial items
Profit before tax
Tax on profit for the period
Profit for the period
EUR
Earnings per share of 10 DKK (1.3 EUR)
Diluted earnings per share of 10 DKK (1.3 EUR)
Statement of comprehensive income
Unaudited
Audited
MEUR
Q1 2024
Q1 2023
FY 2023
Profit for the period
Items that will not be reclassified to income statement:
Actuarial gains and losses of pension obligations
-
-10
Tax on other comprehensive income
-
-
Items that may be subsequently reclassified to income statement:
Currency adjustment from translation of entities
-8
-43
-54
Hedging instruments, value adjustments
-3
Tax on other comprehensive income
-
-
Other comprehensive income
-5
-39
-63
Comprehensive income for the period
11/13
Business segments and sales reporting
Unaudited
Q1
Insulation segment
Systems segment
Eliminations
ROCKWOOL Group
MEUR
2024
2023
2024
2023
2024
2023
2024
2023
External net sales
724
664
194
202
-
-
918
866
Internal net sales
82
95
-
-
-82
-95
-
-
EBIT
124
79
28
25
-
-
152
104
EBIT margin
15.4%
10.4%
14.2%
12.4%
16.5%
12.0%
Goods transferred at a point in time
724
664
194
202
918
866
Geographical split of net sales
Unaudited
Audited
MEUR
Q1 2024
Q1 2023
FY 2023
Western Europe
525
528
2 125
Eastern Europe and Russia
176
138
679
North America, Asia and others
217
200
816
Total net sales
918
866
3 620
Balance sheet
(condensed)
Unaudited
Audited
MEUR
Q1 2024
Q1 2023
FY 2023
Assets
Intangible assets
Tangible assets
Right-of-use assets
Other financial assets
Deferred tax assets
Non-current assets
Inventories
Receivables
Cash
Current assets
Total assets
Equity and liabilities
Share capital
Currency translation adjustments
-179
-160
-171
Proposed dividend
Retained earnings
Hedging
-1
-3
Total equity
Non-current liabilities
Current liabilities
Total liabilities
Total equity and liabilities
12/13
Cash flow statement
(condensed)
Unaudited
Audited
MEUR
Q1 2024
Q1 2023
FY 2023
EBIT
Adjustments for amortisation, depreciation and impairment
Adjustments of non-cash operating items
-2
-5
-2
Changes in net working capital
-79
-72
Cash flow from operations before financial items and tax
Cash flow from operating activities
Cash flow from investing activities excluding acquisitions
-84
-77
-317
Business acquisitions/disposals, net of cash
Free cash flow
-12
Cash flow from financing activities
-47
-238
Net cash flow
-32
Cash available – beginning of period
Exchange rate adjustments on cash
-3
-3
-6
Cash available – end of period
Unutilised, committed credit facilities
Statement of changes in the equity
Unaudited
Shareholders of ROCKWOOL A/S
MEUR
Share
capital
Currency
translation
adjustments
Proposed
dividend
Retained
earnings
Hedging
Total
equity
Equity 1 January 2024
-171
-3
Profit for the period
Other comprehensive income
-8
-5
Comprehensive income for the period
-8
Share buy-back programme
-31
-31
Purchase of own shares
-3
-3
Equity 31 March 2024
-179
-1
Equity 1 January 2023
-117
-1
Profit for the period
Other comprehensive income
-43
-39
Comprehensive income for the period
-43
Purchase of own shares
-3
-3
Equity 31 March 2023
-160
13/13
Main figures in DKK million
Unaudited
Audited
MDKK
Q1 2024
Q1 2023
FY 2023
Net sales
6 848
6 447
26 972
Amortisation, depreciation and impairment
475
448
1 948
EBIT
1 132
772
3 861
Profit before tax
1 157
786
3 889
Profit for the period
862
582
2 898
Total assets
27 304
26 856
26 490
Equity
21 487
19 486
20 898
Cash flow from operating activities
738
485
5 267
Cash flow from investing activities
626
574
2 322
Exchange rate
7.46
7.44
7.45
Accounting policies
This unaudited interim report has been prepared in accordance with IAS 34 and additional Danish regulations for the
presentation of quarterly interim reports by listed companies. The interim report has been prepared in accordance with the
accounting policies set out in the Annual Report for 2023 with no significant changes.
Significant accounting estimates and assumptions
In preparing this interim report Management has made various accounting estimates and judgements that may significantly
influence the amounts recognised in the Consolidated Financial Statement and related information at the reporting date. The
accounting estimates and judgements which Management considers to be material for the preparation and understanding of
the interim report are stated in Note 1.1 in the Annual Report 2023 and primarily relates to impairment testing, valuation of
inventories, deferred tax assets and uncertain tax positions.
Disclaimer
The statements on the future in this report, including expected sales and earnings, are associated with risks and
uncertainties and may be affected by factors influencing the activities of the Group, e.g. the global economic environment,
including interest and exchange rate developments, the raw material situation, production and distribution-related issues,
breach of contract or unexpected termination of contract, price reductions due to market-driven price reductions, market
acceptance of new products, launches of competitive products and other unforeseen factors.
ROCKWOOL A/S
Denmark
Tel: (+45) 46 56 03 00
CVR number: 54879415
Report date: 2024-05-15