Beijer Alma AB (publ)

Thank you. Welcome to this webcast for the first quarter in 2025 of Bayer Alma. Myself, I've been in position about less than one month, but I've been with the company on the board for a number of years. The picture you see now on the first page is actually from one of our latest acquisitions, Svemas. And they are the customer basis, the infrastructure, especially in Sweden. I guess most of you know who we are. We are Listy since many years. And personally, I regard us as a serial acquirer. uh even though market may not have been anticipated the company in that way and if we look at the figures the market situation as everyone knows is very unstable and and things happening day from day to day but in our case the first quarter was a good quarter If we look at the different regions, the Nordic region in general delivered good growth, combination of organic and acquired growth. And Le Sjefors, that's working a lot with the springs, are working worldwide and have a mixed demand, but actually has some organic growth in sales and order bookings. Chassis Springs, which is a separate business within Leche Forge, was slightly lower than last year, but a little bit higher margin. And Chassis Springs are springs to used cars. So that's actually where you replace the factory managed springs with replacements. In the industry segment, Asia, Nordics and US industrial contributed to growth. We have one acquisition we did a few years ago, AlcomX in Holland, and there we have some problems with their market of door springs, because they are connected to the construction market, and that is, as everyone knows, on a low level in Europe. We are working on ways to solve the problem, but still we are negatively affected by this situation. Biotech, who can see an overall stable demand, but it varies with the markets, but Biotech are mainly working in Norway, Sweden and Finland and partly in Denmark. But we had a very nice organic growth and also, as I mentioned, acquisitions. Liquefors only acquired one company in the quarter, and that will be in service from our case from the 1st of April. So it has not affected the first quarter. But it's an interesting investment in India, which is a growing market for the future. So the order bookings increased with 9%. Now we should remember that Eastern was in last year in the first quarter and it comes in the second quarter this year. So we had an organic increase of 4% and the net revenue with 8% to almost 2 billion Swedish crowns. and the adjusted operating profit was 282 million Swedish crowns and adjustment was related to the cost of the former MD when he left the company. We had an operating margin that was on the same level as last year. As you can see that Lykkefors is a a major part of Bayer Alma today with 68%. What we have seen in the past years is that the operating profit margin has been very stable. But as I see it now, we have some opportunities for the future to increase this margin. In Lykkefors, it was also order bookings increased organically as well as in revenue. And industry, who is an area where we have been growing for the last years, increased by 7%. And Chasse Springs decreased by 5%, but that is every year is a bit different depending on how tough the winter are. So that means how much cars are affected by the hard roads and those things. So it's minor change and the margin was actually a little bit higher for Chasse Springs this first quarter. a bay tech we had also very nice figures of increase of the bookings of 15 and net revenue but 70 and here you can really see nice growth for all the three three business units we have so so and mainly they are the main business here for for bay tech are customers in the nordic but if some few of the companies are also exporting worldwide from Baytech. So financials, we had an increase in adjusted operating profit EBITDA and the EBITDA margin was 14.4% same as last quarter last year. and adjusted EBIT margin was slightly higher than last year. So cash flow was more positive than last year. The profit increase that means also that we had a bit better profit per share than last year. Net depth increased also a bit depending on acquisitions. But we still have a good room for acquisitions in our balance sheet. And we are now on a net death to adjusted a bit of two times. Earnings per share increased with 6% for the period. acquisitions as we mentioned earlier we acquired one company in india but it will be closing is our transaction will be the first of april and uh generally i think that now we have for fully fortunate time of consolidation and in in looking for increased profit margin btech UPS Odeman in Finland. It was a small acquisition and will be connected to OPH in Finland. They have contributed the first month and Svemas was acquired in beginning of March, has had a good contribution during the month to our group. And here you can see the acquisitions we've done over the years since 2018. And I think we should see Beotech as a serial acquirer or compounder, some people say. and we have today in two business areas I should not be surprised if it's in the future will be more business with more acquisitions and also general more international acquisitions in the BayerTech area so So I think this is a nice group and I used once upon a time to be the MD of Indutrade for many years and I think the group has a potential to have a performance in the future like Indutrade and other serial acquirers. But we will always be cautious with what we acquire I look at profitable business and also with the low risk on the demand side. By this short presentation, I will open up for questions and answers. So please go ahead.

To ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Carl Noren from Seb. Please go ahead.

Yes, hello and good morning, Jonny. A couple of questions from my side. Maybe we start like overall on a strategic planning here. It sounds a little bit like we should expect maybe more focus on organic growth and organic margin improvements in Länsjöfors, while they are taking focus on growing both organic and through acquisitions. Is that how we should read it here in the near term?

That's a good conclusion, yes. But of course, if there shows up interesting cases in Liquefors, we should acquire there as well. But basically, that's the trend we are looking at in the nearest future.

Yeah, that's good. And then just on chassis springs here, I mean, slightly down in the quarter compared to a tough comparison. I'm just wondering a little bit on the margin improvement there you said you had in the quarter. What is really the driver behind that?

No, it's a minor and it's probably a mix depending on markets and customers and those things. So I don't see it as a trend yet. Okay.

Okay. And overall, the chassis season, so to say, I mean, Q2 is usually quite high season as well. Do you see Q2 similar demand trends as in Q1, or is it too early to say?

It's too early to say.

Good. And then another one on Alcomex, where you stated in the report that you see some effects on the margins in the latter part of the quarter. I mean, should we already expect to see some impacts of better margins in Alcomex in Q2, and then a gradual improvement throughout the year, you think?

Yeah, I think we have some produce going on now, so improve the situation, but we still have some cost reductions to do with the company. So, but on our operational level, I think we can expect a positive trend, but we will have some structured changes on the cost level still in second quarter.

Okay, but will you take that as an adjustment or a one-off?

That will probably be a one-off, yes.

Okay. Yeah, okay, so slightly more to do there. That's clear. And then it's the final one on the Easter impact. I mean, you mentioned that it could have been a little bit positive impact there. Do you have anything more to say regarding that? We're hearing some mixed from different companies here regarding Easter. Do you think it was slightly positive?

Yeah, it's more working days, so... I mean normally all over the years I experienced where Eastern can affect there's a few more working days in March this year compared to last year then how it will end after the second quarter we don't know yet that's too early yeah yeah oh that's good and that's all for me thank you for taking your questions and have a good day

The next question comes from Carl Korshedden from Carnegie. Please go ahead.

Yes, good morning, Jonny. Just a couple of questions from my side here. I noticed that this is the first quarter in quite a while that you didn't mention Europe as a region, I guess, underperforming. Does that mean that you are now, I mean, fairly satisfied with the European business if you perhaps exclude Alcomex? just to get a sense of how underlying Europe is developing.

Well, fairly satisfied. That's a good expression, yes. But I think still there are more to do. But yes, we have made some changes in Germany, so we are less depending on the German market now. But there are things to do in Europe.

And you mentioned also that general, I guess, industrial demand in the U.S. was quite strong in the quarter. Do you think that could in any way be impacted by any sort of pre-buying effects here? Or are you feeling that demand there is holding up quite well overall?

Well, it is hard. I mean, what we are selling in U.S. is to 95% produced in U.S., where the U.S. market will go. I guess you have to ask a person in U.S. about who is the president of the United States. So it's impossible to make any forecast for that.

Yeah, I see. It would be very helpful if, I mean, did you see any sort of shift here in the first parts here of Q2 or any change in customer behavior or Does it look to date quite similar as in Q1?

With the information I have today, it looks similar, yes. But I mean, it can be changed from day to day, week to week. But I mean, we have a pretty wide customer base, so it's more connected to the general market, I think, for industry in the US and specific companies.

Got it, and just on this fire there you mentioned on Minnefors, it would be interesting to hear a little bit more on that and if you would expect to see any further negative P&L effects from that in the upcoming quarters or if that sort of has been handled now already?

It's a small unit and it's in Finland and we have a full insurance coverage for it and we have not decided how to do next step here. We are supporting I think 60-70% of the products from other companies within the group. and we are probably missing a little bit part but we are discussing what's the next step here i don't expect any any more than marginal effect maybe in the coming quarter understood thank you very much that was all my questions

The next question comes from Johan Dahl from Danske Bank. Please go ahead.

Yes, good morning, everyone, and good morning, Jonne. Just sort of a strategic sort of question. You talked in the report about, you know, focusing on margins in Leche Forge. I just wanted to sort of hear your view and also perhaps the board's view on where you see that potential in Leche Forge What do you think, what is the untapped potential in Leksjöfors and the sort of industrial springs franchise which you've built over the last couple of years? And how do you think you can achieve those margin improvements? Is it level of integration or sort of level of cost synergy takeout that you see as potential? And secondly also, if you look on the assets in Leksjöfors today, should we expect also possibly some sort of portfolio review where some assets may not fit that well into sort of a margin improvement profile?

Today, Lysefors is a group where 50% of the sales are from brands not named Lysefors. We have 19 different brands. Lysefors is very much a Nordic brand, but in Europe and US, it's quite different brands. So I think we should really look for a more decentralized organization and see that we put a pressure on the individual MDs for the different small businesses. There could be some cost cutting also in some areas where the costs have been built up during the last years. And eventually it could be some spin-off also, but that should be just a minor thing. I think the potential in improving the existing business. And as we talked about earlier, we have AlcomX, who is still a problem. And when we solve that, it will have a good effect on the group level. And we have maybe one or two other companies also that we are working with now.

Got you. How big of a delta is AlcomX in your mind?

How much?

Now, how much loss making was it, for example, looking at last year?

No, the first quarter was a few million.

Say again? Sorry, I didn't hear.

A few million during the first quarter.

Gotcha, gotcha, a few million.

A few million, I didn't say a few, maybe three, four million or something.

Gotcha, very clear. Thanks so much.

If you wish to ask a question, please dial pound key 5 on your telephone keypad. More phone questions at this time, so I hand the conference back to the speaker for any written questions or closing comments.

Okay, so far I haven't seen any written questions. So I guess I can just say final words. My aim is to start a job, as I said earlier, improve the margin in in the group and that goes for both business areas or for both bay tech and for for um i think a reasonable goal for leisure force is to come back to the 20 percent where where they were a few years ago and i can see the activities that is needed to do that we have it on the map and for bay tech it will be also challenged but i think if you compare to similar groups on the stock market i think we could increase the margin with three four percent units over some time also in bay tech and by that i want to say thank you and I guess we will see each other or hear each other in July next time. Bye-bye.