Falck invests and maintains operating profit

Since the turn of the year, Falck has accelerated investments in digitalisation and innovation of healthcare solutions, which also characterised the third quarter, where an additional DKK 59 million was invested. The investments resulted in higher costs, but the operating profit in the third quarter of 2023 landed at the same level as last year due to increased demand and operational improvements.

"There is an increased demand for our healthcare services, and this has given us organic growth of 5.5%. The reason why operating profit remains in line with last year is that we have chosen to prioritise long-term investments in a comprehensive digitalisation. We are investing in digitalisation that strengthens the business and supports the proliferation of digital healthcare, just as our recent acquisition of Hejdoktor helps expand our position within telemedicine,"

says Jakob Riis, CEO of Falck.

Despite the increase in sales, reported revenue decreased from last year. This was mainly due to exchange rate developments in the US, Sweden and Norway as well as the divestment of business activities. As a leading provider of employee healthcare schemes in Scandinavia, Falck also experienced that the economic slowdown in Norway and Sweden created reluctance on purchasing decisions among companies.

Falck's ambulance business in the US prospered on several frontiers. Two major contracts were extended, price increases were implemented and a better staffing situation was created compared to last year, which resulted in cost savings. In the past year, Falck has optimised its ambulance operations in the US and especially curbed staff shortages through improved recruitment and retention efforts. This has been achieved by implementing significant parts of an international ambulance model.

New partnerships in the quarter

The development of new healthcare solutions takes place through innovative partnerships. In the US, Falck initiated virtual consultations, which will reduce the number of emergency trips in Alameda, and partnered with Californian Jump Areo on future access to manned drones. In Denmark, a new innovation project was launched in Region Zealand to help witnesses to serious accidents with psychological help and prevent the development of PTSD.

Financial highlights

• Revenue was DKK 2,933 million compared to DKK 2,942 million last year. Revenue was lower due to exchange rate developments and divestment of the ambulance service in the UK in October 2022.
• Operating profit before special items etc. (EBITA) amounted to DKK 137 million. Last year, EBITA was DKK 142 million.
• The EBITA margin was 4.7% compared to 4.8% last year.
• Net profit for the period was DKK 14 million compared to DKK 77 million last year.
• Free cash flow after tax amounted to DKK 140 million compared to DKK 50 million last year.

Falck narrows its revenue guidance for the year to DKK 11.6-11.9 billion compared to DKK 11.5-12.0 billion previously, and raises its operating profit guidance before special items etc. (EBITA) to DKK 400-475 million from DKK 325-425 million previously.

Falck's quarterly report can be found on www.falck.com.