Bergman & Beving AB (publ)

Thank you very much. Welcome everyone to the Bergman & Beving interim report for our Q3 quarter. My name is Magnus Söderlin, I'm the CEO and on my side here I have Peter Schön, our CFO. So just to start off with some highlights from the Q3 quarter. We have another quarter with increased earnings profitability and we also now have an increased EPS. and if you have followed us we have now 20 consecutive quarters with increased profits and this quarter the turnover increased six percent but that was mainly due to acquisition and we'll come back to them about the organic uh top line growth but we had an ebta increase of 10 and and that was mainly driven by the acquisitions contribution we had during the quarter And we continue also to improve the EBTA margins. So we're now at 9.6 this quarter compared with 9.3, the comparable quarter. And we also continue to improve our profitability. So our profitability measure has profit of working capital, and we now have an increase of 6% units. And this is measured rolling 12. So there's a kind of lag of the improvements we have made. So the rolling three figures is even higher than the rolling 12 figures. So all the activities we have been running for the last quarters is now showing results in the improvement in this ratio. And we also have, as earlier stated, an increase in earnings per share, rolling 12 to 7.55 compared with previous year 7.15. And we have achieved this despite that continuous sluggish market. We have said earlier that the best KPI on an aggregated level for the group is number of employees within the construction industrial sector in the Nordic. And the Q3 calendar figure for that show and the group decrease, if you kind of weighted the countries and the different segments, industry and construction, a decline of 3%. And if we dig into the figures, actually, the biggest decline is actually in Norway within the industry that had a decline of 6%. And the lowest decrease, actually all markets, all segments have a decrease, is the construction market in Finland that is decreasing with 1% this quarter. But then you should remember that they have had a very strong decrease earlier in the earlier quarters. So they are kind of flattening it out now, it seems. But still, it's a sluggish market. I said it in the previous quarterly report, and I say it again, the diamonds are formed under pressure, so we still have not the market with us on a group level. So we continue to lower the cost and to work with, you know, working capital decreases in oral kind of organic units. And we have some progress here. But also in terms of the gross margin, we are doing some activities. You don't see an improved gross margin this quarter, but there are some extraordinary items, and I will come back to that during the different division presentation, why we don't see that improvement in this quarter. But underlying, I would say, we still have a strong gross margin as such. We also had a very successful acquisition quarters. We made four acquisitions in the quarter, whereas three was made in December. And our target, yearly target in terms of EBITDA to acquire is 50 to 80 million. So we are now in that range. But that doesn't say we are not stopping acquisitions. And we will see if we manage acquisitions. So, in total, we made six acquisitions so far this fiscal year. And we presented the Maschinam and the Spraylet acquisition in the previous quarterly presentation. As I said earlier, we made four acquisitions the Q3 quarter. The biggest one is Leverpynta. It's part now of the core solution division. It has an annual revenue of 180 million SEK roughly. And as you can see on the EBTA, we only acquire companies with an EBTA margin above 15%. So this is kind of the level that Leverpynta has delivered historically. And we also only acquire companies with a profitable working capital about 45%. And this company has a profitable working capital well above that range. So Leverpynta has operation in Sweden and Finland. They are leading in producing high quality laminate boards used under high pressure and heating. And they are typically used in situations where you need really high quality products. And one example is within furniture within the professional segments, typically within hospitals and schools and those type of environments where they need high quality furnitures. Another acquisition that is adding up to the core solution is Ovesta, and they are building special purpose door. It's kind of sound oscillating door or fire safety doors, turnover of 35 million, a margin well above 15%, and also them have a profit of working capital above 45%. They are selling to typical constructions and installation companies. And it's in situation where you need those special purpose stores. Typically within also government buildings and those type of situation. And they are currently only present in Finland. But we are looking into the possibility to expand their business into other Nordic countries. One other acquisition we made was Kolinder, that's a Swedish company and that is now part of the safety solution division. Turnover 60 million and have an EBITDA on the range of 15% and also them having a profit over working capital will above 45%. We own several companies when we make signs, special purpose signs. And this is a company that is also have a very strong position in that niche market. And we now have companies in Sweden and Norway and Denmark in this niche. So this is kind of strengthen our position in the Nordic in this specific markets. And lastly, LabSense is a Finnish company, and that is now part of the industrial equipment division. 35 million with a very strong profit margin and also a very strong profitable working capital ratio. And they are the distributor of laboratory equipment used especially within the government sector. So they are kind of representing a lot of leading manufacturers within that laboratory equipment space. So you can see we acquire three companies in Finland and we think we have a very good experience with acquiring companies in Finland. And there are a lot of high quality companies and we also feel that the price level in Finland tend to be a little bit lower than in many other Scandinavian countries. So all in all, we acquired 385 million so far this year. And as you can see, all of them have a profit margin above 15%. So if you calculate backwards, you will see we are already in the range of 50 to 80 million profit acquired so far this year. I said it before, but we now have 20 consecutive quarters with increased EBTA, and that increased 10% this quarter. And we have a current now of 27% in terms of the EBTA development. The EBIT level increased 4% and the EBT level was flat compared with previous quarter. But there are some extraordinary items in the financial net that explain why the EBIT level didn't increase this quarter. So that is some special terms or special items there that affect the financial net in a negative way. And once again, we also continue to improve the EBITDA margin. So if we then look at the revenue development, we said that we had an increase of revenue with 6%. And on this slide, you can see the acquisition contribute with 11% and the organic growth with this quarter 5%. We previously talked about we're phasing out high volume, low margin product, but stated in the previous quarter, we are getting to end of that. So I think this organic kind of development in this quarter more reflects the underlying market. And it's a little bit higher than the 3% I indicated about the number of employees in the Nordic. But you can't see that KPI as a 100% reflection of our kind of underlying market. It's the best proxy we have. So we don't feel that we actually lose market shares in the markets, generally speaking. We actually win some of these. I will present some of them later on under the division presentations. So I think this more reflects the kind of underlying market situation as such. With that, I will leave the words to Peter to explain more about the financials in the index quarter.

Yeah. Good. And if we look at the gross margin, we see a slight decrease in the gross margin, but still underlying, we increase the share of revenue from own products. And the reason why the gross margin is slightly decreasing is that we have Some call it one-offs. SV is doing a lot of, they retake products from the new customers, which affects their gross margin a bit in this quarter. And also we have sold for Fastit, we have discontinued an operation in Asia and sold out some stock to zero margin. we anticipate the gross margin to stabilize and still be on that high level going forward, even though we won't see the gross margin increasing at the pace that we have had historically. And if we look at the group target overview,

Yeah, as you can see, we have a continuous improvement in the profit of working capital. We are now at 30%. The target is to reach the 45% latest fiscal year 26-27. That's two years plus from now. And as I said earlier, we have a continuous improvement in this ratio, both because we improved the profit, but also that we improved the working capital efficiency. So my expectation is that we should see a continued improvement in that going forward, still aiming for the 45%. If we look at the EBIT development, we are now at a rolling 12, 395. We have the target for 500. and we are moving in the right direction. We see opportunities reach the 500, but we had expected the market to pick up a little bit earlier and We need to have some help from the market to kind of get to the 500. But many indications shows that we will see a pickup here in the next quarter to come. So that's still in reach. And the EBITDA margin is now 8.3, and we aim for the 10%. And that is also something that we will see improve over time. Still aiming for the 10, even if that's also quite challenging.