Interview with MT Højgaard Holding’s CFO Dennis Nørgaard

For those who have not previously heard of MT Højgaard Holding, can you tell us about your business, what you do, and which markets you address?

MT Højgaard Holding is one of Denmark’s leading contractors in the construction and civil engineering sector, with a history spanning over 100 years. The company was formed through the merger of Højgaard & Schultz and Monberg & Thorsen in 2001, but its roots trace back to 1918–1919. Over the years, the MT Højgaard Group has been involved in numerous major construction projects and developments that have shaped modern Denmark.

Today, MT Højgaard Holding is a Danish company after divesting its international operations. The company focuses on three main segments:

1. Newbuilding – the MT Højgaard Group constructs large and complex buildings such as office spaces, multi-family housing, and public facilities.
2. Refurbishment and redevelopment – Denmark have a vast stock of older buildings in need of modernization, and the MT Højgaard Group is a key player in this segment. Particularly, housing cooperatives and property owners rely on the company to renovate buildings from the 1960s and 1970s.
3. Infrastructure and civil works – the MT Højgaard Group undertake large-scale projects such as bridges, tunnels, and port facilities. The company has been involved in the construction of the Øresund Bridge and is currently working on a 1.4 km tunnel in Nordhavn, north of central Copenhagen, in collaboration with the Belgian company BESIX.

With a strong local presence and extensive experience in both private and public projects, the MT Højgaard Group is a key player in the Danish market.

The MT Højgaard Group is a major contractor specializing in construction, civil works, and infrastructure projects. What are the key competitive advantages of your offering within the construction industry, and how do you view your positioning relative to other players in the market?

The MT Højgaard Group holds a unique market position by combining technical expertise, in-house production, and long-term partnerships. Unlike many competitors that rely heavily on subcontractors, the MT Højgaard Group retains a significant portion of its production and expertise internally. This provides greater control over quality, costs, and project timelines. Attracting the right talent is a key focus for the company to ensure a strong and sustainable human capital base.

Another key competitive advantage is the company’s experience in handling complex projects. The MT Højgaard Group specializes in larger and technically demanding construction projects. Examples include the company’s involvement in infrastructure projects such as train workshop and the expansion of Bornholm’s port.

Additionally, the MT Højgaard Group holds a strong position in the refurbishment segment, assisting housing cooperatives and property owners in modernizing buildings. Denmark has a growing demand for upgrading older buildings, and the company’s expertise enables more cost-effective refurbishments compared to demolition and new construction.

The company also has strong collaborations with public entities, including municipalities and semi-governmental organizations. Through its long-term partnership strategy, the MT Højgaard Group ensures a stable project pipeline even in times of economic uncertainty.

Revenue from construction partnerships and collaborative projects grew by 9% in 2024 and now represents 37% of the Group’s revenue. What makes the MT Højgaard Group’s partnership model so successful, and how do you plan to expand this area further?

The MT Højgaard Group’s partnership model is built on early project involvement, close collaboration with clients, and a focus on establishing long-term, mutually beneficial relationships. This has allowed the company to increase its revenue from collaborative projects by 9% in 2024.

Instead of participating in isolated tenders, the MT Højgaard Group continuously works with the client from the initial concept stage to project completion. By being involved as early as the design phase, the company ensures that projects are feasible from the outset. This reduces the risk of delays, rework, and cost overruns while increasing customer satisfaction and providing a more stable cash flow.

This partnership model generates more stable revenue streams compared to traditional procurement methods and partnerships involve significantly lower risks for disputes and claims. Clients benefit from more predictable cost structures, while the MT Højgaard Group minimizes unforeseen expenses and project delays.

The MT Højgaard Group sees significant potential in scaling up this model further, particularly within public projects, where the demand for cost-efficient solutions is substantial. At the same time, the company is cautious not to let partnerships become too dominant in its business model. Maintaining a balance between partnerships and traditional competitive bidding is crucial, as participating in tenders helps keep the company competitive and sharp in the market.

2024 marked a significant progress in winding up MT Højgaard Holding’s international activities, with most businesses sold or in the process of being divested. What were the key milestones in this process and what is your strategy going forward?

In 2024, MT Højgaard Holding divested operations in the Faroe Islands, Portugal, Angola, and most of its business in Greenland to fully focus on the Danish market. A key milestone was the sale of the concrete element factory in Greenland and the restructuring of the electrical contracting company Arssarnerit, which is the largest electrical installation firm in Greenland.

Previously, Arssarnerit operated across multiple cities with both project-based and service-oriented business segments. In 2024, the company underwent a restructuring, selling off smaller branches and consolidating operations in Nuuk. Additionally, MT Højgaard Holding sold off certain assets, such as employee housing, to make the business more capital-efficient. The effort to streamline and strengthen the company continues, with a planned sale set for 2025.

Although divestments of international activities resulted in a loss of DKK 168 million in 2024, it has strengthened the company’s long-term stability and generated over DKK 150 million in cash proceeds. By exiting less profitable markets, MT Højgaard Holding can now allocate resources more effectively to its core operations in Denmark.

Going forward, the strategy is clear: we are focusing on increasing efficiency and profitability within the Danish market. There are no plans to re-enter international markets, as Denmark offers sufficient growth opportunities.

Where do you see MT Højgaard Holding in a year?

2025 will be a year of stabilization for MT Højgaard Holding. After several years of changes and a successful strategic transformation, the company has chosen to focus on consolidating its achievements rather than pursuing rapid expansion. While stabilization may not sound exciting, in an industry where many competitors face financial difficulties or even bankruptcy, it is a deliberate and strategic move.

MT Højgaard Holding underwent a significant turnaround in 2024, particularly with the divestment of the international operations. In 2025, the company expects to complete this transition, which will significantly reduce losses associated with these discontinued activities. This is a key factor in improving the company’s net result, as ultimately, net profit—not just EBIT—is what creates value for shareholders.

While MT Højgaard Holding does not anticipate an increase in EBIT in 2025, we have a clear strategy for improving profitability through enhanced efficiency and cost control. There are no plans for aggressive expansion, but the company is actively evaluating its next strategic steps for the future.

A key focus in 2025 will be finalizing the winding up of the international activities and ensuring the company has a solid foundation for future growth. With a strong order book and an increasing share of stable partnership projects, MT Højgaard Holding is well-positioned to deliver sustainable returns for investors in the long run.

Can you name five reasons why MT Højgaard Holding is a good investment today?

1. Focus on core business – The company is now a pure-play Danish operation with increased transparency and efficiency. 
2. Diversified business model – The combination of newbuilding, refurbishment, and infrastructure – as well as long-term strategic partnerships – makes the company less sensitive to economic cycles. 
3. Attractive valuation – The stock trades at a lower multiple than its competitors, making it an appealing investment. 
4. Strong ownership – The foundation-backed ownership structure provides stability and long-term commitment. 
5. A solid order book and project pipeline – With an order book of DKK 11.8 billion, estimated value in partnerships of DKK 5.3 million, value of joint venture orders of DKK 0.8 million and awarded but not yet contracted projects worth DKK 1.6 billion, the MT Højgaard Group has strong future prospects.