Indutrade AB (publ)

Welcome and good morning on our behalf as well. Let's start with a summary of the 2024. We had a successful 2024 with solid financial performance and we were able to strengthen our strategic platform, paving the way for continued sustainable profitable growth going forward. Our diversified structure is providing resilience in a weaker general business climate stable demand situation with plus two percent total growth in orders and net sales respectively our EBITDA margin is or came in above target and we had a strong cash flow 16 well-managed and profitable companies were acquired during the year with a total annual turnover of 1.6 billion SEK and we had our climate targets validated by the science-based target initiative and the board proposes a dividend of SEK 3 crowns per share which is a bit above the 2.85 we had last year. If we then turn to the highlights of the fourth quarter, ordering take in line with same period last year, organically a decline of 5%. Organic development mainly explained by strong references linked to a large order for pharma production in Denmark. However, the majority of the companies had organic order growth. Net sales increased 7% in total, where of 2% organically. The EBITDA margin was stable and high at 14.6%. And if we exclude one off, it was 14.3%. We continued our work with inventory reductions and we had a record high operational cash flow of 1.6 billion SEK. Four acquisitions completed in the last quarter and one so far in the beginning of 2025. And the pipeline is continued to be strong. If we then look a little bit more into order intake and sales, total order intake and net sales growth was 0% and 7% respectively, supported by good contribution from acquisitions, which had an impact of plus 5% respectively. The organic order intake decreased with 5%, mainly due to this strong reference linked to the larger order for pharma production in Denmark, as I mentioned earlier. And if we adjust for this, the organic order intake was basically in line with last year. The demand varied between companies, but in terms of customer segments on an aggregated level, the medtech and pharma segments showed the strongest demand. excluding the impact of the large order last year. And for example, in the single use area, which has been weaker for quite some time. And now we saw a bit of an uptake there. Also, the energy sector, engineering and a large part of the Scandinavian process industry were relatively stable. The infrastructure and construction customer segment continue to be generally weaker. Organic net sales growth was plus 2%, with strongest growth in business area life science and process energy and water. Also, half of the companies grew organically during the quarter, despite many companies and customers being closed for a longer period than usual over the Christmas holidays. Then we turn to the geographic market-oriented sales, and we can here see that the Nordic countries aggregated percentage strong numbers with a stronger sales growth in Denmark and Norway. However, Finland remains slightly weaker. In the UK, Ireland, the Irish market stood out positively, mainly due to strong sales within the pharma segment. And in key countries like Switzerland and Germany and the Netherlands, overall development was weaker due to the general macroeconomic headwinds. However, still also many companies in these markets having a good sales situation. Sales in Asia was higher than last year driven by good development in for example valves for power generation and products within the marine segment. Also each year we report the distribution of total sales across various customer segments. This year, the medical technology and pharma segment remains our largest, with a share increasing by two percentage points compared to last year. It's a great segment to be in, low cyclicality in general and high profitability in the customer base. So something we have deliberately invested in for some time now. On the other side the share of sales to the infrastructure and construction and general engineering sectors each decreased by one percentage point. And the other customer segments remained stable except for the marine segment which declined by one percentage point. Then we turn to profitability and elaborate a little bit more on this. Our EBITDA margin was stable and high at 14.6% unchanged from the same period last year. As mentioned, the underlying EBITDA margin excluding some one-offs was 14.3%. Organic sales development and slightly higher expenses are the main drivers of the underlying EBITDA margin decline. The expense increase is linked to general cost inflation but also some certain growth related initiatives in some companies and also some restructuring costs which will become beneficial this year. And it's obviously so that where you have growth opportunities, you need to invest before you can harvest. So that's why some of the expenses are a little bit higher. Continued good pricing efforts from our companies resulted in a strengthened gross margin and I would say that our companies have managed gross margins really well over a longer time period. High quality products, strong application knowledge and very good customer service levels deliver customer value and give our companies confidence in pricing. And acquisitions and divestments were also margin accretive. All in all, EBITDA increased within total plus 7% compared to last year, where of minus 1% organically. Acquisitions did, however, have a positive effect of plus 7%. If we then turn to the business areas and the sales situation on an aggregated level, half of the companies showed organic sales growth in the quarter. Business area life science and process energy and water had the strongest development with plus 9% and plus 8% organic growth respectively. Life science was driven by sales of diabetes related products in the Nordics and also production equipment to Novo Nordisk. Process energy and water had good development in the energy sector and the process industry in Scandinavia, but was partly offset by the weaker market situation in Finland. The slightly damped market climate continues to impact business areas, industrial and engineering, infrastructure and construction, and also technology and systems solutions. In terms of EBITDA margin for the business areas was improvement in business area, infrastructure and construction, and also process, energy and water. The margin in infrastructure and construction was impacted positively by acquisitions, some divestments and also some restructuring activities. In process energy and water, the strong gross margin was the main driver. Industrial engineering had the weakest margin development because of the organic sales decline, but also partly due to some positive one-off items in the previous year reference. The lower EBITDA margin in life science is mainly explained by the higher expense levels in some companies, primarily linked to a higher growth-oriented activity level, general inflation, but also some one-offs. Lastly, technology and system solutions did a good job in defending the EBITDA margin despite the organic sales decline, mainly thanks to positive gross margin development in many companies, as well as contributions from newly acquired companies. If we then turn to acquisitions, 2024 was a successful year in terms of acquisitions. 16 in total with an annual turnover of 1.1 billion SEK. We have in a given year before made 17 so 16 stands out to be a good number. It was a strong finish of the year with four acquisitions completed in Q4 and the majority of the acquisitions completed last year were generated internally and the new business segment structure will continue to strengthen our internal lead generation over time. There's been one acquisition so far in 2025, the German company Ecoroll, who is specialized in tool technology for mechanical surface treatment. And the inflow of new acquisition candidates is on a good level. And if we look at acquisitions trending over time and how they deliver profitability to us, it's always important to repeat that the number of acquisitions should be followed over a longer period of time. As mentioned, high pace in 2024 and historically good contribution in Q4. Regarding the financial effects, the bridge effects from acquisitions over the last 12 months have added over 80 million SEK to the group's EBITDA in the fourth quarter, a significant improvement from the previous quarters in 2024. Furthermore, we can also see that the acquisitions are margin accretive with an accumulated EBITDA margin of over 16% for the full year and over 20% for the quarter. By that I leave the word over to Patrick to comment more on the financials.

Thanks Bo, yes let's dive into the details some more then. Total orders were in line with last year as Bo commented in the quarter and up 2% for the full year. Total sales grew 7% in the quarter and 2% for the full year. Book to bill in the quarter was 96%, 98% for the full year. As also mentioned previously, gross margin improved again up to 35.7%. And for the full year, the gross margin came in at 35% compared to 34.6% last year. EBITDA in absolute value increased with 7% in the quarter, driven mainly by effects from acquisitions and divestments. While the organic side, organic sales and also slightly higher expenses created some headwind. And for the full year EBITDA decreased with 2%. the margin in the quarter EBITDA margin was 14.6 that's in line with last year however we had some one-offs in the quarter primarily connected to to earn out revaluations which had a net effect of plus 26 million if you exclude this the margin was 14.3 Full year EBITDA margin was 14.4 versus 15 last year. Looking at the finance net, that decreased with 4% in the quarter, but was on a full year basis up 8%. Tax cost increased by 29% for the quarter, resulting in a tax rate of 22%. That's a normal tax rate for us, I would say. Last year, the tax rate was exceptionally low in the quarter four, so not really a fair reference. For the full year, tax costs decreased by 6%, corresponding to a tax rate of 22%. Earnings per share increased in the quarter with 3%, but it's down with 4% on a full year basis. And we will look more into that on the coming slides. Return on capital employed came in at 90%, slightly lower than our target due to the slightly lower earnings the last year, but maintain high acquisition pace Cash flow wise, quarter four came in really, really strong. It's normally a seasonally strong quarter, but this was exceptionally high, a record high level, actually 1.6 billion. And for the full year, operational cash was 4.1. That's also high level, but slightly down versus last year. And lastly, the net debt to EBITDA ratio was stable at a low level of 1.4 at the end of the year. That's the same level that we had last year. Then looking some more at the cash flow, that was, as I said, a record high, 1.6 billion. for the quarter and the improvement comes mainly because of slightly higher result and that we also managed to reduce the working capital in line with what we did last year. If you look specifically at the inventory levels, the organic inventory levels continue to decline sequentially in the quarter. And the organic inventory to sales ratio is now coming closer to the preinflation level, which is encouraging to see. As we have mentioned before, our companies are relatively capital light and there's continuously a strong underlying operational cash flow coming from our companies. Normally we have good cash conversion. You can see that also. in the slide right now trending on a rolling four-quarter basis at more than 130 percent so that's that's uh that's good working capital efficiency improved but also them compared to both in the last quarter quarter three and and and also the same period last year Earnings per share then, as I commented earlier, increased in the quarter with 3% from 1.95 to 2.01 SEK per share. On a full year basis it was 5% lower than last year, 7.86. And the quarterly change, the increase in the quarter is mainly of course then related to the EBITDA change, the EBITDA increase. Somewhat offset by the increased tax cost I spoke about. If you look on a more longer term basis, then average increase in EPS over the last three and five years have been 9% and 13% respectively. And by that I conclude them with the financial position and the interest bearing debt decreased sequentially. It was slightly higher than last year but decreased sequentially and it is due to that we have the relatively high acquisition pace during the year and then a slightly lower full year operational cash flow. If you look at the debt ratios, we are at relatively historically low ratios, net debt equity ratio of 49% versus 53% last year. And then the net debt EBITDA, I mentioned earlier then, 1.4%, the same as last year. If you exclude earnouts, 1.3%, and that was on 1.2% last year. Worth noting maybe then is that part of the short-term debt was successfully refinanced during the quarter through a new seven-year loan, term loan of 75 million euro from Svensk Exportkredit. And then we also issued a new five-year bond of one billion SEK, all at, I think, competitive conditions. To summarize, despite high acquisition pace, our debt ratios are low, and I think also the debt maturity profile is well balanced, and we have a strong financial position. Thanks for me, and then I leave back over to Bo.

Thank you, Patrick. Then we turn to sustainability. It was really satisfying that we received the validation from the science-based targets initiative of our climate targets during quarter four. We have quite high ambitions here and our targets in terms of scope one and two emissions, we should reduce by 50% and scope three by 25% by 2030. And we use 2023 as a base year. In the longer term, we actually aim for a net zero by 2050. And our companies continue to show good development in the sustainability area with clear progress on the group wide KPIs we have set. And we see sustainability improvements primarily linked to reducing our CO2 footprint as a clear business opportunity. and we see that this is appreciated by the customer base in a good way. Some key takeaways. The Indutrade model based on decentralization and balanced diversification shows its strength. and is reinforced with a new segment oriented group structure we have been in the new structure for one year now and it's well received and we see step by step that that new structure will develop both in terms of organic and acquisition growth in a good way there was a stable demand situation in general and continued sales increase and good profit levels We had all-time high operational cash flow for a single quarter. There is some market uncertainty remaining for the upcoming quarters and we have a slightly lower order backlog, but not very low in a broader perspective. However, I would say that the macroeconomics are trending in a favorable direction and in combination with the underlying investment needs in several sectors with our entrepreneurial companies is balancing the risk. 16 acquisitions completed in 2024, one so far this year and the pipeline remains strong. good progress in terms of sustainability and we have the validation from the science-based target initiative and all in all we have strengthened the platform for long-term sustainable profitable growth for Indutrade. By that we end the official presentation. Thank you for listening in and we open up for potential questions.