Impressions from investor meeting
MT Højgaard Holding (MTHH) today announced that it has sold its Faroe Island activities which comprised an 80% share in RTS Contractors. Assuming that MTHH receives clearance from the competition authorities in Angola, Seth will also be disposed in Q1'24, leaving 'only' the Greenland operations left to be disposed. At today's investor meeting, MTHH management expressed confidence in being able to dispose of the Greenland activities during 2024e. While the two ongoing construction projects, the college dormitory and airport in Nuuk are 91% and 79% completed, respectively, the previously flagged (Q2'23) issues with the misplacement of the airport control tower is bug but not a deal-breaker. All told, MTHH appears to be well on track to close the chapter (except for the Maldive operations now managed by MTHDK) on its troubled international operations by the end of 2024e (some warranty obligations, likely to be on the books, though).
Furthermore, at today's investor meeting, MTHH management also expressed ambitions to generate cash flow in 2024e on par with that of 2023 (CFFO of DKK 793m). In our view, this is achievable, but definitely not trivial. It would, among others, require a stable net working capital development (NWC) in 2024e on top of strong NWC improvement during 2023e. If achieved, it would further increase the company's net cash position which stood at DKK 248m at the end of 2023. The company's current market cap is (see sidebar) DKK 1.3bn.
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