Atlas Copco AB

Welcome to the Atlas Copco Q3 2026 report presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing hash 5 on their telephone keypad. Now, I will hand the conference over to CFO Peter Kinnart. Please go ahead.

Thank you, operator, and to all of you on the call, a very warm welcome to this Q3 2026 earnings call for Atlas Copco Group. Before I hand over to Wagner to start with the short presentation, I will already now remind you to only ask one question at a time during the question and answer session, just to make sure that all participants in the call have the opportunity to raise at least their one most important question. Should we, of course, go to the queue, we, of course, create the opportunity to ask a second question afterwards. But without no further ado, I will hand over to Wager to present the quarter results.

Thank you, Peter, and welcome to this conference call where we will present the Q3 results. And we are also quite happy to announce the result. I think we are quite pleased to see the development in orders received with a very strong order intake, driven by several product lines, several divisions, and the four business areas delivering organic growth, and three of them with double digit organic growth. It was really good to see. Of course, vacuum is outstanding, very nice development there. But basically, most of our divisions are doing quite well with good organic growth. We also see continued growth in service, which is part of our strategy for several quarters. We have positive development in our service divisions. Also very happy to see that. And also the activity level was strong, the order intake strong. We had record revenues, quite happy to see the level we managed to reach, driven mainly by vacuum technique, as we are going to speak later on. But we are quite happy with that development as well. So profit margins, I think what I'm happy about is to see the sequential improvement. I think that was good. And also the fact that we are ramping up, we are now delivering record levels in revenues, and we also managed to deliver a solid operating cash flow. We are also quite happy with that development. And in the quarter, we closed four acquisitions. So then looking more into the numbers, 52.3 billion Swedish krona in orders received, which is an absolute value, also a record level, but we have some currency help there, which ended up in a 25% organic growth, quite solid. like I mentioned before record revenues 47.9 billion Swedish krona organic growth of 11% was also good to see in vacuum technique they managed to have a very good output and very good organic growth in revenues as well Profit margins at 20.8, but here we had some items affecting comparability. In this quarter, mainly the main item was restructuring that we have done in industrial technique, specifically related to our German product companies. that we had to do an adjustment in industrial technique due to low activity, lower volume, but the underlying margin was 21.3%. And the operating profit at 7.7 billion Swedish Krona, also very solid. Increased in basic earnings for sure. Very solid cash flow, like I mentioned. Year on year, you see a drop in the return on capital employed, but sequentially, we see an improvement in our return on capital employed. Then if we go to the regional split, also quite happy to see growth in all the continents. If I started in Asia, very strong development, 39% growth. mainly driven by vacuum technique, but also the other BAs developed quite well. We have a little bit more challenging in industrial technique, but most of the other three BAs, they had good development in Asia. So when I go to Europe, them 8%, it was a bit more flattish in compressor technique. business area, but very solid in vacuum technique, good in industrial technique, and also very good in power technique. But considering the situation that we see in Europe, we are quite pleased with 8% growth, because the environment is a little bit more challenging, but we still manage to grow our business in Europe. then North America very solid as well 39% growth again mainly driven by vacuum technique but all the business areas have developed quite nicely in North America this quarter power technique super solid industrial technique as well driven by both automotive and general industry very strong and compressor technique also very solid growth in in North America so In South America, 4% growth, good to see, developing well. The major country in South America is going through election, a little bit of challenge, but still. good growth and also we see a recuperation in Africa and Middle East with plus 21 percent after a couple of quarters a little bit more challenging is also good to see a good development there where our main businesses are growing quite nicely so quite good to see the regional spread and the development of our orders in the different continents. And that is translated then to a 25% order increase organically in our orders received. 3% is structural, coming from our acquisitions. so total and a little bit of currency help in the top line total growth 29 percent which is which we are like I said before quite happy to see that development then if we go to the different business areas compressor technique had like we have mentioned organic growth but six percent vacuum technique 82% quite outstanding development in vacuum technique but also power technique 13% double digit industrial technique 12% solid growth and it's also good to see the contribution of vacuum technique growing in 12 months rolling then if we go now more in details talking about the business areas organic growth of six percent in compressor technique we are quite happy to see solid demand of our compressors a little bit more challenging in Europe like I mentioned before not a drama but it's good to see six percent notable growth on our gas and process compressors there the development keeps on going quite well we see LNG continues to be a good contributor especially coming from the US but not only also this quarter we saw good development in market segments like heat pumps for district heating in Europe as one example of markets that performed well this quarter for gas and process. Service continues to grow and that has happened for quite some time. Quite happy to see as well 5% organic growth on compressor technique when it comes to revenue. Good to see. We also need to further increase output because of the organic growth and operating margin at 23.6, negatively impacted by currency sales mix from different products and geographies and higher supply chain cost. So lower than last year, but it's fair to say as well, it's the highest profitability that is still the highest profitability that we have in the group. We know we can perform better over time, but the most important for compressor technique is to continue to grow. And we continue to invest in technologies to achieve that. One example is this innovation on the cooling side. that we can integrate this cooling or work together cooling and compressors, for instance, that could give quite a nice saving for our customers. Not only that, we also closed an acquisition this quarter, Euriclimat, that we have added in the report as well. It's a quite important acquisition because it will allow us to step into new markets. There will be more cooling, but not only. I think they also have low temperature heat pumps. And we are going to work now at the beginning of this acquisition to unlock this value. Of course, when you do that, there are quite a lot of integration items. at the beginning but I think compressor technique keeps on building technologies that will allow them to have sustainable profitable growth and that's what we have achieved over the years and we will continue so when it comes to vacuum technique 82% organic growth is really good to see that development for sure and this is for vacuum technique was fantastic development on the semiconductor market but not only I think we are quite happy as well to see the development in industrial and scientific vacuum so there are market segments doing quite well that we see quite a lot of investments in segments like space R&D company countries investing more in R&D that is increasing the demand of our products in industrial vacuum we see metal metallurgy that has a very important segment battery production as well are important segments. Service business continues and revenue was really good to see 28% organic growth in the revenues. And all that has translated in improved profit and profitability. So reaching 22.2% profit, mainly driven by increased volume. And we had an impact coming from the currency. Also good to see return on capital employed going up. And we keep on doing innovation. This product now is for industrial vacuum, a new vacuum pump. That was one of the first products that we developed when we started to step into vacuum. And now we have come with a new design with better energy efficiency. And we continue our journey on innovation as well in vacuum technique. So when it comes to industrial technique, also pleased with 12% organic growth, really notable growth, very good growth on general industry. I think there we managed to focus on growing market segments like electronics, aerospace, defense, and some other segments where we can find good growth. Our products have been very well perceived. Some of these market segments, they need to do a fast rampart. ramp up and we have the right products to support them with that. But not only, and secondly, solid growth in automotive equipment, mainly driven by the US. And there is because our customers, they need flexible production lines. There is a lot of reorganization going on in the US that requires flexible production line. And we have the right products for that. But not only, we also see good focus on automation. And like we have said in previous occasions, our focus on automation, we have done some acquisitions to further unlock this automation journey is now bringing quite good results, especially in the US. where we see good activity level revenues two percent organically profit improved but 18.7 is not where we want to be and and this time we have done the the and adjustments like I mentioned at the beginning some of our German operations were not at the level we would like and then we decided to adjust the underlying profitability is 20.6 so stable return on return on capital employed and here in the bottom you can also see a nice innovation now for boating application or or hard high torque application, often improved safety, repeatability. And the good thing about this, normally you can do this hydraulically, but when you add some measurement equipment, you can really offer much better solution for our customers with process control. And that part of the business is also growing quite nicely, I must say. going to the left business area power technique also solid growth 13 we see improved demand overall all the divisions performing well of course the development in the us it's super strong because organically is very good on top of that we have done an acquisition of MTE that is also performing well. But in many geographies, power technique is performing. Well, good growth as well in specialty rental and continued growth as well in our service business. Also good to see that they can catch up on revenues. So very solid revenues. And also I improved profitability. That was also nice to see that they managed since Q1 to bend the trend and to improve profitability. That was also quite good to see. And they continue to invest in innovation. This case is a new generator to empower. We have two generators inside of that canopy or container. And the benefit of that is variable load applications can really save a lot of fuel consumption. so keep on investing and you see that they are also running at the record levels revenue also in power technique reached record levels so and then when we look to our if we exclude the depreciation of intangible for the acquired entities we reach 22.2 which is a good development I must say but perhaps with that I can pass to you Peter you can continue on the income statement okay thank you Wagner so yeah I think operating profit 9.95 close to 10 billion unadjusted compared to 8.5