Alimak Group AB (publ)

Thank you and welcome to this quarter two 2025 call for Alemak Group then. And as always, I have Sylvain with me here. So turning page and a short recap of the group. Global industrial company focusing on vertical access and working at height solutions. Around 3000 employees, truly global business. We are supported by some fundamental global trends for our business, urbanization, more happening at height to land these gears health and safety it's of course a very important factor but also i would highlight automation robotization as our machinery makes are movable and makes you know a possibility for for these new technologies to operate from our systems We do have a leading market position in our niches, which gives us a strong position. We have existed for a long time, so our global footprint and a large installed base, which is also a fundamental piece for our service business. And overall, a solid balance sheet, good cash conversion and financial position to invest. Turning page, new heights strategy, something we launched then back in 2020. It's a simple but also powerful strategy that has served us very well with a decentralized divisional structure where all the result and the business is happening with simple and to the point strategy and strategic drivers. and that program was now first part was up to 25 and we are now working on the next step up to 2030 and we are then planning to have a capital market day on november 25th where we will talk more about that route to 2030. Turning page and our financial and sustainability targets, as you have seen with us, and we are en route to deliver on these. Turning page into Q2. And yeah, after a strong Q1, we are again delivering strong performance and continued margin improvements in Q2. So we are off, I would say, to a very good start of the year, the first half. order intake was down four percent in reported figures but still an increase of four percent in constant currencies and the revenue were down one percent but an increase of seven percent at constant currencies so here we have a eight percent negative currency impact We continue to see increased earnings and margins. So we reached an EBITDA, adjusted EBITDA margin of 18% in the quarter up from 17. And also here we saw a huge currency impact of 7% in the quarter. And if you look year to date, order intake is now 10% organic. And we report a 17.7% EBITDA adjusted margin for the first half year. So a strong start to the year. We signed after the end of the quarter, July 8, an agreement to acquire Century Elevators, permanent industrial elevator business in the US. It's a business with a turnover close to 100 million SEK and the margins in the vicinity of the group margins. and this is something that will strengthen and be part of our industrial division in in the group and they have a position then and business in us and canada we also delivered cash flow improvements in the quarter and we are now a leverage ratio of 174 down from the 229 a year back Turning page a little bit more details in the quarter order intake was 1,720,000,000 SEC down 4% and 4% up in constant currency. We saw strong performance in industrial and facade excess while we had a decrease in construction, wind and HSPS divisions. Revenue was 1,791,000,000 SEK in the quarter, down 1% or up 7% in constant currencies. And we saw positive contribution from industrial and facade excess. And also here, if you take the currency into account, it's a negative impact of 134,000,000 SEK. So it would have been 1.925 if currencies of last year. EBITDA at 322 million SEK up from the 307, giving a margin then of 18% up from the 17. And important to note also, this is the first time ever that the group is touching the 18% mark, which of course we are happy with. And it's supported by improved margins in industrial wind and facade access. And also here with the currency impact, that's 23 million SEK in the quarter, so else it would have been 345 Turning page, service, the order intake was down in the quarter 10% or 2% at constant currencies and 661 million SEC versus 733 last year. And it's industrial and construction division that's reporting a little bit lower order intake, but nothing more to take into that, that it's timing effects. And it's, of course, something that we continue to drive and focus on equally as before. Revenue was up 5% and 12% at constant rates to 694 million SEK up from 660. And especially strong performance in the wind division. Turning page into facade access. Order intake was 451 million SEK in the quarter, up 24% or 35% at constant currency. So good order intake, but also towards a little bit lower comparable. We saw strong North America order intake, especially on the infrastructure side, nuclear energy, we took orders, and also on the service side with refurbishment, retrofit and replacements, giving us nice orders while the main BMU market, building maintenance unit market, is still soft in North America. Europe also contributed positively in the quarter. Revenue was 500 million SEK, up 1% or up 9% at concentrates, and we saw organic growth in all regions. EBITDA at 56 million SEC up from 50 giving a margin then of 11.2 versus 10 and the expansion is due to what we have been doing for a long time pricing project execution but also still then negatively impacted by a low factory utilization due to again the soft BMU market, but also soft margins because of losses on some legacy projects that are in the final stage. And as we have said, these are expected to be finished more or less by the end of the year. Turning page and a little bit more on the business update. We are having an organizational change. So Philip Gautinot, who has been then head of Facade Access Division, he has decided to leave the group. And first of all, I would like to thank Philip. He has been instrumental in, he was the CEO of Traktelen and he has been instrumental in in integrating Tractel into the group and starting off a very good solid strategy and execution into FacadeXS. So that's why we see these great improvements. And I wish him all the best for his new role that he's picking up. And we have then Hervé Ross, which is currently head of Facade Access Division in North America, that will then take on the role as the new EVP for Facade Access. And of course, I'm very, very happy that we have internal candidates and Hervé is not only an internal candidate, a very strong and perfect person for this role. We are also focusing on, of course, the margin uplift. The division is still not delivering the margins that we are sure should be there. uh and due to that also the bmu market is remaining to be soft we have decided to take out some more fixed costs so we are launching a restructuring program focusing on europe and and where we also will see planned or we plan to do capacity reduction in our factory in spain and the restructuring cost is 60 million sec with an expected annual saving of 30 million sec as of next year And this one, of course, will be recognized in the second half of 2025. I also would like to highlight that if we look into a little bit more the geographies of this business in North America, where both Alimak and Tractel had a very strong base from before, we see a very successful development. You know, we are driving new initiatives and the business is developing extremely well. And we also have margins into that business, which is well above group average. While in Europe and Asia, Pacific, Middle East, Africa, it's still where we have way too low margins and where we now put extra effort, of course, to ensure we can lift. But this also means that we have comfort in that we will lift the margins to levels which is respectful for this group. Turning page and into construction order intake was 327 million SEC down 28% or 21% at constant rates. And it's basically affected by volatility in demand between quarters and regions, but also the fact of course, that the construction market still remains soft globally. So it's a fight day by day to win orders and be close to customers and make things happen. But overall, I think we are doing well. We saw weaker order intake on the rental side in Germany, Benelux and Australia, and also on the used business somewhat in US, but driven by also high comparables. Order intake for mass climbing work platforms was good, and that's also where we have a very strong commercial focus and will have a lot of expectancy for the future. Revenue was 407 million SEK, down 4% or up 3% in constant rates. And we saw stronger revenues for mass-climbing work platforms in Australia and Europe, but somewhat lower revenues in hoist and rental in North America due to some project delays. EBITA, 68 million SEK, down from 71, giving a margin of 16.7, up from 16.6. uh yeah and it's driven by the revenue but also happy to see that we deliver a small margin uptick and a decent margin level in these difficult times for the construction business Turning page. So we continue to invest in people, product development and operational efficiency. And I think this is important to note. We are employed, even though this market is challenging, you know, we employ more people from and we have employed salespeople, we employ business development people. So we continue to drive very aggressively. We invest in product development and in our product range. And we also drive operational efficiency everywhere, taking out costs where that could be done. And this is all the things that contribute to us holding up this business in challenging times we launched a new scan climber mass climbing work platform in the quarter a small very neat machine that can take two and a half tons very cost-effective design and something that can go for the global market and we have also invested significantly in france we have upgraded our rental facility in in france north of Paris and of course taking into all sustainability standards of today we have developed a new training center there for our customers and our own people and it is because you know we believe in France we have a strong presence in France and we want to continue to grow there Turning page, HSPS, a bit softer quarter, but again, due to challenging market conditions, order intake was 316 million SEK in the quarter, down 10% or 4% at constant rates. But also important to note, we are still 4% up year to date, first half. Lower order intake was due to some slow construction sector, but also primarily in Central and Southern Europe. but also offset by good things you know we continue to focus very heavily on our elevator segment it's a very important segment for us and we are close to our customers and we take market share in that in that business revenue was 321 million sec down nine percent or down three percent at constant rates and following the same trend and as as order intake due to the closeness of book to bill EBITDA at 55 million SEC down from 69, giving a margin of 17.2 versus 19.5, and this is then driven by the somewhat lower revenue, but still also relatively resilient, I would say. turning page business update so here we also focus on investing and driving things forward you know we have new management in in this division so we are we are focusing even more now on on product development driving of operational and organizational efficiency and and changing somewhat, but also we continue to drive our specific focus into verticals, customer segments. So, and I will, as I was alluding to on the previous page, elevator segment, it's important to us and we take share. We focus on all parts of the world now. And we also drive really our focus on confined space. Some nice success stories working with our end customers. We have fault protection systems installed on transformers in Germany and Poland. And we also got a nice business with retrofit of height safety systems for high voltage transmission infrastructure in Germany. Turning page, industrial and very happy to see, you know, we continue to develop very, very strongly with this business. Order intake was 481 million sec at 9%, 16% up at constant rates. And actually it's 22% up year to date organic. Very strong. We see strong performance primarily on new equipment orders within oil and gas, but also government and public and multiple heavy industry segments. The aftermarket business was, as I already was alluding to, a little bit down in the quarter, but it's due to lower refurbishment and timing of orders. Revenue was 399 million SEK, up 10% or 17% at constant rates. And yeah, it's driven by higher equipment deliveries, but also good aftermarket performance in the quarter. EBITDA, 105 million SEK, up from 82, giving a very strong margin of 26.3, up from 22.7. Also considering that we are continuing to invest in sales resources and product development and services. So, you know, still on the move forward and upward. Turning Pages, we acquired, as I was saying, you know, the or signed an agreement to acquire the industrial part of Century Elevator on July 8th. turnover of 9.7 million us dollar 100 million sec and they are operating then close to our group margin they will give us a strengthened position in us and canada and it gives us an access to a complementary cost-efficient elevator design because this business there has been exclusive distributor or pega czech brand elevators in the us and canada and this is something that we will continue um in addition they also of course did service around 20 of the business was service so we see a very nice opportunity to of course also grow service with this business and we get along you know with the business a nice set of very high talented and skilled service people so of course we will continue to grow grow that piece and then we see also of course some some overhead cost synergies Another positive thing, we bought this from brand Safeway, which is one of our biggest customers in North America. They are on the rental side, so on the construction side. And we have agreed also that we will work even closer together going forward. So I think also that's something I'm very happy to see. Turning page and wind order intake was 158 million SEC down 22% or down 15% at constant rates, but also here, I think it's important to note timing effects, etc. It's still up 4% year to date. But it was negatively affected by the US tariff uncertainties that we have been seeing. You all have, I'm sure, you know, picked up on what's happening in the US. And so far, this tariff uncertainties in Q1 affected the willingness to decide on new investments. We also had somewhat high comparable year over year with China. Revenue was 179 million SEK, down 8% or down 2% in concentrates. And the service, training, safety offerings partly offset somewhat lower equipment sales than in America and Southern Europe. EBITDA at 38 million SEK, slightly down then from 39, but the record margin for the wind business of 21.4%, up from 19.8. And a good share of the market. and also that we have been able to mitigate the tariff effect. So that's something we are of course very happy with. Turning page, we continue to see growing opportunities in the wind market. We take share and we work very close with the Chinese OEMs and we expand with those. India is becoming a more important market and there we also take very nice orders and we see that this is a market we need to be very close to going forward. And then, of course, continue to invest and drive our aftermarket business. And in the quarter, we were also rewarded for our innovation. So we received this EOLO Innovation Award for a patented service lift concept that we have developed. To say a little bit more about the US and the wind market, we have now also, as you know, gotten this big, beautiful bill. which will take away tax incentives for the renewable energy in the US in the coming years. But it's still valid for all projects that start up this year, it's said, and to be finished by 2030. so what we see is that and when we talk with our customers is that the market looks to be very stable and solid for us at least in the next couple of years 26 27 so we really have no worries about the u.s market neither in the next coming two years and then we are turning page and into the profit and loss summary and then i hand over to sylvia

Thank you, Ole. Good morning, everybody. Once again, we are pleased to see an adjusted EBITDA going by more than revenue. It's almost becoming a habit. It's a 5% growth for adjusted EBITDA versus an almost flat revenue. And this comment applies to both the quarter due to 2025 and the first semester versus same period last year. And we trust this is a testimony to the strength of our business model and the continuous improvements in operational efficiency. And I'll give some more color on that on the next slide. There were no items affecting comparability in the quarter. Below EBITDA, the amortization charge is consistent with Q1 2025 and our expectations. It's coming down versus Q2 2024 as a result of Tractel related intangible assets now being fully amortized. FinanceNet is done as well due to the reduced debt and lower interest rates. That's in line with our expectations, which is around 40 million per quarter this year. Taxation rate in the quarter is up versus Q2 2024. That's really a factor of the evolution in the country mix. But at a level of 25.7%, we are close to the average of 25% we foresee. So higher adjusted EBITDA, no ISE, lower amortization charge lead to a significantly higher EBIT. It's a 16% growth in the quarter. And combined with the lower finance net, despite the slightly higher taxation rate, we grow the net result by 28% in the quarter. Next, please. So I'm now coming to the key EBITDA drivers, gross margin and operating expenses. This has been a strong quarter from a gross margin point of view, with an improvement in all divisions except Facade Access, where we saw a small degradation. It's interesting to see that we have managed to fully mitigate the adverse foreign exchange rate developments and the new US tariff. This has implied adjustments to our supply chain, some customer price increases whenever this was needed. And we believe those swift actions have been enabled by our agile, decentralized operating model, which is proving its value in those relatively challenging times. Operating expenses as a percentage of revenue are coming down in the quarters at the second driver to the EBITDA growth. uh and the operating expenses uh you know for all divisions except industrial were either flat or down in the quarter despite some cost inflation such as labor or some voluntary cost increases as mentioned by ule typically product development digital And as we have said in the previous quarter, industrial division has expanded its cost base. That's primarily a factor of a growing sales organization, which is being built to support the sales growth. So overall, as a group, we continue to very actively work on our cost efficiency. We reduce the costs we don't need and we spend wherever we need to fuel our profitable growth strategy. Next, please. So, as I said, the result for the period was up 28%, 184 million SEC versus 143 million SEC in Q2 2024. uh excluding ic the net result was the same 184 but versus 154 in q2 last year this is a 19 increase The EPS was up by the same percentage, 28%, so 1.74 versus 1.35 with the same number of shares. Adjusted for ISE and acquisition-related amortization, EPS was 1.98 SEC in the quarter versus 1.78 last year. This is an 11% increase. So moving to operating cash flows, we continue to focus highly on cash generation and that allow us to keep holding 12 months cash flow on a good level, as you can see on the right hand side graph. We have increased cash flow from our operation in the quarter versus Q2 last year. So it's 182 versus 164. Although we have increased working capital in the quarter due to the effects of contract phasing in Facet Access Division, primarily. And we believe those effects will be reversed mostly in the second part of this year. So overall, not a bad quarter. Although we think we can do better and then we'll continue to drive those improvements in the future. So net debt in the quarter was slightly up 2.6 billion SEC versus 2.4 at the end of Q1 2025. The increase is due to the dividend payment around 300 million SEC in the quarter and the revaluation of the euro loan and those negative effects were partially compensated by, of course, the positive operating cash flows. The leverage is 1.74 at the end of the quarter. This is slightly up versus Q1 2025, but still well in line with our financial target of being below 2.5. And our focus on cash generation will contribute to future deleveraging. Our capital allocation priorities remain unchanged. We will continue to invest in organic growth. I mentioned several examples of expenses related to that. As we have said for some time, we have the financial muscle to make acquisitions. We are very pleased we have signed and soon closed the century acquisition and we continue to work actively on future acquisitions. And of course, we are committed to delivering dividends according to the policy, which is 40 to 60% of our net earnings. So of course, it's a board proposal in the end and AGM decision. And finally, regarding Rossi, we are pleased to see another sequential increase. This is an important metric for us. We are not 26.8% excluding goodwill, 11% including goodwill. That consistent increase over time is driven by the improvement in profitability and of course the underlying recurring improvement in performance. On that, I'm pleased to pass the baton again to Ole.

Thank you, Sylvain. And yeah, we turn page to the summary. So a strong quarter, I would say, and a strong start to the year, the first half. We continue to deliver on the new heights program, which serves us well then, as you have seen, with the 4% order intake growth and 7% revenue growth in constant currencies in the quarter. But also, as I was saying, you know, on the year to date base, we have a 10% order intake growth organic and we are at 17.7% adjusted EBITDA after the first half year. We continue to take actions to improve profitability and take out cost or structure we don't need. So that you also see now in FacadeXS we do something more. uh and we also do have this solid financial position that we are uh talking about you know so which allowed us to make this nice acquisition uh which is then due to close end of the month so should be part of the group from first of july sorry from first of august then this also financial position allows to continue to drive this so so uh you know we are uh uh working on our acquisition funnel and and i think we will see a good activity also on this going forward and we continue to invest in all divisions to drive profitable growth i think also what's nice to see when you look into the divisional result and as a group we do very well we continue to lift but you also see that it's a potential in all divisions to also absolutely do do more and we are working also of course on the future as i was saying so on november 25th we are planning to have a capital market day where we will give more details about that so with that i would like to thank you and we move over to q and a

If you wish to ask a question, please dial pound key 5 on your telephone keypad. To enter the queue, if you wish to withdraw your question, please dial pound key 6 on your telephone keypad. Next question comes from Sophia Sorling from DNB Carnegie Investment Bank. Please go ahead.

Yes. Hello. This is Sophia from DNB Carnegie. Can you hear me?

Yes, Sophia. Hi. We hear you well.

Yeah. Great. Thank you. Okay, so my first question is related to the Facade Access Division. So I noticed this order intake. You mentioned that the infrastructure projects are rolling in. What about the profitability level here in this type of infrastructure projects? Should we expect that these are in line with your EBITDA margin target for Alamak Group, or should we expect that these orders have quite a

a lower margin level that's my first question yeah i think very clearly that you can expect that they will support continue to support our business you know with where we have taken most of this is in north america uh now where we also do have you know a margin on the facade access business as i was saying which is well above the group average

so so absolutely we expect to have good margins and we do have good margins on that business okay and a follow-up question so in terms of complexity and length of the project do it differ significantly or or not at all compared to the other orders within facade access and that could actually i mean make it more difficult to set pricing for this type of orders in your view

No, I wouldn't say, you know, it's not big of a difference, but maybe if anything, it's maybe a little bit shorter, some of them. But, you know, typically, I think you would see also one to two years of time between order and delivery, you know, but it could also be shorter, but not so often, which is when they are much longer. But again, you know, it depends so much what it is. So... if anything i would say slightly shorter than the bmuse all right okay and maybe a technical question here but no sorry um yeah sorry did you have something more in the answer no i was just trying to say which gives us even more control over it of course you know when it's shorter time yeah definitely yeah um yeah and the

somewhat of a technical question, but this one-off item of 60 million in the second half of 2025, is it expected to be like a split of this cost into Q3 and Q4, or is it rather closer to the latter part of the second half of 2025, or how should we think about this cost?

No, you would see it in both quarters. We will start to do some of these things now, as soon as we are back after vacation or it's going. I can't give you an exact split between the quarters and the months, but it will happen throughout the next six months.

Could you give some more details on what type of capacity costs that you are taking out there?

it's a little bit related to everything you know it's a mix of things that we are looking at across Europe but also of course a significant piece in the factory where we also try to take down fixed costs so it will involve both some structure and also people okay thank you

And yeah, let's go to wind division. So you mentioned this US terrace that was fully mitigated during the quarter. Do you believe it will be possible to mitigate this ahead as well? Or, I mean, what is the investment appetite among your customers here? What do they, do you think demand will come down now due to this?

Yeah, no, but that was actually the thing, yes. So we believe so. With the big, beautiful bill, you know, and that's the policy change that you see. And that's the biggest impact, you know, the way we see it, because that will take away the tax incentive for renewable energy in the coming years. But it has a lag, so it's not coming into effect until the end of this year. which means that all projects that have started by the end or during 2025 will still get the tax grant you know and when we talk to our customers they plan to start more than enough projects this year so that we don't foresee any drop in volumes rather maybe the contrary you know for us in the next couple of years in north america and then when it comes to tariff situation it's related to some uh uh aluminium and stuff you know that we need there but those things we have basically already mitigated so we don't We don't foresee the tariffs per se to impact our business, wind business for now. It's more been this uncertainty of the investment climate, which now seems to be stabilized when the big beautiful bill was sanctioned. Even though it's not positive news long term, it's positive news it seems like almost in the next two years. And and then you could also believe, which I think most people believe, you know, by that time, the Senate will look different and the most likely the, you know, the climate from 28 and forward, but also different. Yeah. So not major concern. Thank you.

No, I think. Thank you. And yeah, and the HSPS division. You mentioned it's somewhat of a softer demand here. Could you say anything about the specific order trend during the quarter? Has it been different compared to due to last year?

Yeah, we saw a little bit softer market, you know, a little bit across the board in the in the quarter. But we also know that we have a lot in the pipe, so it's nothing fundamental, you know, and orders are flying in, you know, beginning of this quarter. So it's We don't have a general, you know, major concern about this. It's more a timing again, you know. The market was very volatile and with the geopolitics and everything around us. So everyone's cautious. And these products we mostly sell, you know, and through distribution. And that has been somewhat lower in the quarter. But we have no major concern about that. But at the same time, we also drive a lot of changes in that business to really fundamentally dig into where we can find good growth and profitable growth going forward. So we are making a lot of changes there to the better. So we see a lot of potential. Absolutely.

Okay. And within this division, overall, how do you experience the competitive landscape here at the moment? Any aggressive price pressure, etc.?

I wouldn't say it's that, you know, because where we have, you know, our products, most of it, you know, we are competitive. We have an edge. We have a position, you know, and customers are loyal to because it's related also to health and safety and, you know, comfort around the good solutions. So that's the problem. It's more the market thing. We are strong in the niches where we operate, but it's also so huge, this area, you know, so we are also very, very small in the niches where we operate. So, you know, so it's a lot of opportunity that we are digging more into.

Okay. All right. Thank you. That was all my questions. Thank you for your answers.

Thank you.

The next question comes from Andreas Koski from BNP Paribas Exane. Please go ahead.

Thank you and good morning. Three questions please. The first one is on construction and the order intake which was relatively weak in this quarter, and I'm sorry if you've already elaborated on this, but I was a bit late on the call, but can you talk a little bit about the underlying demand situation in construction? Is the weakness mainly related to larger project businesses or do you see underlying weakness from let's say rental companies or your own rental business or what explains the relatively weak ordering taking construction for this quarter and what do you expect going forward yeah but it is you know some timing effects this market has been soft as we all know for a long long time and

then the willingness to invest in our machines you know because most of our machines goes to either rental companies or to construction companies and of course they don't invest in this type of new machinery unless they have to you know in principle when the times are difficult then they rental companies have their yards you know a lot of these machines in their yards and of course they don't renew so maybe they delay renewal programs you know when when it is like it is now so So we are a little bit lagging in that cycle. So when the construction market really starts to come back, then we expect, of course, these things to kick in again, but also with a little bit lag then. We also have our own rental, as you know, and as I also said now, that we saw a little bit lower order intake in our own rental in this quarter, but we have had good order intake in Q1 in rental. So that also comes with some swings between months and quarters. So not something that we are fundamentally seeing any trend changes on. Not at all. So it's more this thing that the market still continues to be very challenging and the willingness to invest in new machinery when the market is weak, it's not there to that extent. uh but of course you know machines also go to industrial projects it go to infrastructure projects and these things are still moving so there is a you know a baseline thing there and we are convinced we take market share we have also won a lot because we installed you know globally our used concept so instead of in places where it's not possible to sell new we have been selling a lot of used which is You could say, yeah, it doesn't load your factory. No, but you know, it ties these customers to us, you know, because they choose our concept, which is something that is a choice they make for a long time. So it's also very good for us to do that. So. And we know multiple competitors are struggling. They are in bankruptcy and have gone bankrupt. You know, so overall, we still feel that we do a good job, but the market remains very, very challenging and it's a fight day by day for everything we win here.

And how to think about your backlog in construction, because I remember Q423 and when you had weak orders and then in Q124 your revenue dropped quite significantly in construction and that impacted your margins quite meaningfully. Should we be worried that something similar could happen this time around?

We feel relatively comfortable going into Q3 that because, you know, the order intake we have has given us a decent volume in the factory, you know, or the factories. Yeah. So that should be relatively okay. But it's also depending on the mix and so forth in the quarter. But we are not overly concerned and do not believe that we should fall back to the levels that you refer to.

Yeah, yeah, yeah. And then on industrial, which continues to be extremely strong, I mean, another quarter with very strong organic order growth. Is this mainly driven by your expansion into new applications, etc.? And can you see those kind of solid double-digit growth rates continue for several quarters or even several years? Or how to think about the very strong performance in industrials?

We plan and we work and we believe that we can see a lot of growth in this business for a long time. absolutely the thing is that you know we are exposed to some nice segments for the time being also you know which is support you know mining and you know energy and stuff you know where where we see we are also now you know since we drive this dedicated division you know which didn't exist really five years ago but really with focus and segment by segment we are also you know as soon as there are new things like data centers you know they they need cooling towers with or three floor high and then you need lifts and systems like this you know so we are on to also these new things that pop up and we are since we have this segment focus we are also you know uh challenging and helping customers to maybe choose these systems instead of ladders you know where they typically have you had the that manual type of thing you know or and now have lifts instead so this is the way we proactively work and we take market share and gain position and Uh, so we feel very positive about, uh, you know, the market, uh, we said also now, you know, governmental things, you know, the investments into, uh, into, um, the military that, uh, as all of this started to see come, you know, we, we also see that, you know, because, uh, that means the sites or structures, uh, at multiple floors where, where they need our means. So there is a lot of opportunity.

Yeah.

Maybe also one more thing is that you know these platforms that we're having you know which is especially the mass climate work platforms it's a technology which will also allow you know because it's centimeter by centimeter moving up or down and they are wide you know so these machines will allow robots or you know automation to actually be used at places where you don't have where you never have thought about that today so that's also structures and ways you know we are working on so we see a lot of potential also in that respect going forward yeah and and the aftermarket business is an important part of the industrial

traditional business area. Do you see the same kind of growth rate on the aftermarket side? Or is there is a risk that the equipment is growing much faster now and that is the lower margin business and over time, this will lead to a negative mix effect or how to how to think on the margins? I mean, we have to think about that.

The margin side, I would say you shouldn't be overly concerned about. We also secure that we have good margins on the new sales. So we are getting out, I would say, good margins in both ends. but also at the same time you know when you look at service i think this is also the strength of actually what we have done the change we did back in 2020 then at that stage service division was a separate type of animal supporting all divisions now this sits in every division each division have their own service setup and this means you know that for example in industrial we uh we are close to the customers because segment by segment this also varies you know maybe in one segment you sell the new machinery to one type of you know maybe an epc or a developer while the service contracts goes to the direct end user itself which is two different parties but you are aware of it so you can go after it in other cases it might be the same cell you know so you sell both the machine and the service contract as one go so and this structure that we're having now that allows us to really strongly focus and of course wherever we sell a new machine we are also doing whatever we can to make sure we get the service contract thank you thank you very much for your time and have a great summer thank you you too

There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.

Yeah, thank you. When I look at the screen here, we do not have any written questions, so unless they pop up very quickly, I think we are at the end.

The next question comes from Jenna Xu from Barenburg. Please go ahead.

Hi, thanks for the presentation and thanks for taking my question. I just had a follow up on what was asked about the wind division earlier. You mentioned that because of the uncertainty that we're seeing surrounded in the tariff situation, it had an impact on the order intake this quarter. But given that the big beautiful bill is slated to come into effect, I was wondering if this means that we might see the possibility that you know projects that were planned for 26 possibly even 27 would be pushed forward into 25 and we would see like um you know a very good second half of the year for the wind division just curious on your thoughts on this yeah but i think you're absolutely right but uh but it will not affect us in the same manner you know but projects will be

Because that is what this big beautiful bill is saying, you know, that if projects start in 2025, they will get the tax credit, you know, or the tax benefit. So that means that from what we understand from our customers, that they will try to start and, you know, all everything, you know, that will secure our volumes for 26 and 27. know because it doesn't mean that that they will all be installed and delivered you know in uh in 20 uh five so it's just that you know projects are getting kicked off uh but we will have so what it means for us the way we see it is that we will have a good 25 we will have a good 26 and we will have a good 27 order intake wise and revenue wise in u.s or win no real change but maybe slightly better than what we first saw actually half a year or a year back because they are pushing some things forward. Yes.

Yeah. Could you just remind us quickly, like what are the lead times like for the wind division?

The lead times, but that varies a lot. Sometimes we get the orders early, but you know, it more has been six to 12 months, but could also be shorter. So it varies, you know, but on average, plus minus six months.

Okay, great. And last question on the margins. You know, we've had another stellar record quarter for the wind division margin. And I know you said previously, like, it would be very good if the wind division could have margins of 15% and up, but we're at, you know, more than 21% now. So where do you see this going forward, particularly since, you know, there's also a huge focus right now on driving that aftermarket and that training and service opportunity?

Yeah, I haven't changed my view heavily. First of all, I'm very pleased, of course, with the margin that we are seeing and the performance that we have in that division, the consistency and the structure, the way of working. So it's remarkable. But at the same time, we shouldn't forget what type of industry they are in and uh the market how it operates so uh so you know that that maybe say 15 is on the very conservative you know but that they should have be in the vicinity and or north of the group target you know but that we should start to expect a lot over over 20 i i doubt over time because of this market dynamics. But that said also, you know, it's not that we put limits to this, you know, we just try to do as good as we can every day. And that's what we see this team is doing. And that's why it's also constantly developing, you know? So, but pragmatically and realistically, you know, considering the business environment that that business operates in, I don't think it's likely that you will see something fundamentally different to where we have seen over the last year or so.

Okay, thank you very much.

Thank you.

There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.

yeah i see now that still is no more written questions here so unless it's something popping up So I think with that, I would like to thank everyone listening in and also for the questions received. I would like to thank our dear employees, you know, driving the group forward to new heights every day. Customers, partners being close to us and loyal. So thank you all. I wish you all a great summer. Until next time.