As a result of the weakening in the housing market, the Group made a considerable reduction in its workforce in the second half of 2008. The international financial crisis, which manifested itself in the fall of Lehman Brothers in September 2008, soon had a devastating effect on access to financing for private customers and companies alike. It also created major uncertainty about future developments in the housing market.
For BWG Homes, the start of 2009 was dominated by the need to secure continuing access to long-term financing and ensure profitable production in a very uncertain market. In the first half of the year, new covenants for the Group’s long-term financing were negotiated, while equity was strengthened by means of two share issues. These were well received by the market.
Despite the financial crisis, the housing market was already showing clear signs of improvement in early 2009. The Group has kept a clear focus on sales in order to increase its order intake both in Norway and Sweden. Sales were strong during the year and continued to rise. After the considerable decline in production as a result of staff cuts in 2008, the order backlog rose significantly in Norway and Sweden in 2009. The total order backlog was 25.8 per cent higher than at the end of 2008. A more streamlined and effective organisation and attractive projects resulted in good operating efficiency in 2009. This meant the Group was able to deliver satisfactory results, albeit with a lower turnover.
The Group’s financial position has strengthened considerably through the year. Loan terms with the Group’s main bank are established for three years, and the share issues carried out brought NOK 161 million in new capital. Net interest-bearing debt fell by NOK 590 million compared with the previous year. The ownership stake in the insurance company Gar-Bo AB in Sweden was sold in spring 2009, free-ing up NOK 35 million. The equity ratio had increased from 32.1 per cent in 2008 to 39.8 per cent at the end of 2009.