Indutrade AB (publ)

Welcome to the Indutrade Q2 presentation for 2026. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to CEO Bo Anvik and CFO Patrik Johnson. Please go ahead.

Welcome and good morning on our behalf as well. We are glad to present a strong quarter and let's start with the overall highlights. We had a good development in many areas in the quarter, starting with the top-line development. Demand continued to improve and total order growth was 14%, of which 8% organically, with the majority of our companies growing. Continued positive book-to-bill of 105%. And the strongest demand was with companies having customers within the medtech and pharma area and also the energy sector. Net sales increased 11% in total to record high 9 billion SEK with strong organic growth of 5%. EBITDA was also on a record high level and EBITDA margin improved to 14.7% with good operational leverage on the organic sales and margin accretive acquisitions. Cash flow from operating activities increased and inventory levels were flat from last year organically. We continued being successful in terms of acquisitions. Nine companies acquired in 2026 so far and slightly larger companies on average. Our pipeline remains strong. As mentioned, top line development was strong and demand improved. However, still varies across companies, geographies and segments. Companies with customers within medtech and pharma and the energy sector experienced the strongest demand, but all major customer segments improved compared to last year. Despite the strong net sales, order intake was even higher, resulting in a positive book to build in the quarter. The order backlog is now 8% higher than the same period last year. In terms of sales, acquisitions contributed positively with 6%, a sequential improvement from the 5% we had in Q1 26, and currency movements had no impact in the quarter. The organic development was good, plus 5% benefiting from the increased order backlog development the last few quarters. All in all, a very good top line situation, strong sales, but even stronger order intake. If we move into sales per market, sales improved in the Nordic countries with a broad positive development in many companies and segments, except in Denmark, which were down due to lower deliveries to Novo Nordisk. In the rest of Europe, the situation was mixed with slightly negative development in the Benelux region, mainly due to lower construction activity and some tough comparisons in a few companies. Sales was flat in the UK, Ireland and Switzerland and Austria and up in Germany. Development in Germany was mainly driven by the engineering sector and companies within MedTech and Pharma. Sales in North America and Asia is more volatile. This quarter it was flat in North America and up in Asia. Development in Asia was mainly driven by valves for power generation. Total EBITDA increased 19%, corresponding to an EBITDA margin of 14.7% compared to 13.7% last year. One of our companies in the final earn-out stage has performed better than expected. Their earn-out became larger than the provision we had, so the additional amount we had to pay to them impacted our profit negatively. Excluding this revaluation, the EBIT margin was 14.9%. EBITDA margin was positively affected by the organic sales development, continued strong gross margin and margin accretive acquisitions. Regarding the gross margin, there have been price increases in many areas during the quarter, especially connected to freight, certain raw materials, semiconductors and some electronic components. But our companies have done a really good job in passing price increases to the customers and protecting their gross margins. Looking at the sales development per business area, four out of five business areas had organic growth in the quarter. LifeScience stands out with really strong development and it's mainly connected to broad positive development for many companies within medical technology distribution. We have, for example, deliberately invested in the Polish LifeScience market since some time back and see some really good progress there recently. Processed energy and water and industrial and engineering had good development for many companies and segments. Processed energy and water benefiting from the large order book built up the last quarter. And within that sector, it was predominantly the energy segment broadly increasing. And for example, investments in gas powered power plants. but also cooling applications for data centers, and we see some emerging defense orders coming into this business area as well. In terms of industrial and engineering, it was rather broad in terms of sales improvement. To mention some areas, we had good progress in terms of hard metal tools, specialty chemicals, and the automotive aftermarket. Infrastructure and construction was down 3%, still impacted by the weaker general demand and thus lower order book values coming into the quarter. But I would say that the outlook for the second half of the year is cautiously optimistic. And technology and system solutions had a positive development with 2% organic growth, however, from somewhat lower levels, but nonetheless good progress. And also, I would say that many companies are delivering in a good way and stepwise increasing. And I would say that also there we have a cautiously optimistic perspective on the second half of the year. Four out of five business areas improved the EBITDA margin in the quarter. Industrial and engineering and life science were positively impacted by the organic sales growth, gross margin improvements and also margin accretive acquisitions. Infrastructure and construction has for a longer time worked with cost reduction measures and some divestments to improve its margins. And margin accretive acquisitions contributed positively in process, energy and water. And technology and system solutions had a lower EBITDA margin compared to last year, impacted by weak performance in a few project oriented companies, mainly in the UK, as we have talked about earlier. Acquisition pace was good in the second quarter, and we have so far this year welcomed nine companies to Indutrade with a total annual turnover of 1.5 billion SEK, continuing the successful trend we have had since the second half of 2025. Looking at the rolling 12 months, we have formally closed 16 companies with a total annual turnover of 2.2 billion SEK. During the quarter, we announced the acquisitions of AXOTAN in Sweden, FACOTECH in Germany, VALVCO in the Netherlands, CREATECH in Germany and OTEC in Norway. And after the end of the period, we announced two add-ons, DORTE EGELUND in Denmark and ALBIOX in Finland. All business areas except infrastructure and construction have done acquisitions. Infrastructure and construction continues to prioritize organic operational improvements. This year, so far, the average company size has been on a slightly higher level. This should not, however, be seen as a strategic shift. We are opportunity-oriented and act on the opportunities we believe to be accretive and successful. Consequently, there will be times when we have periods of larger acquisitions and also periods with smaller acquisitions being made. The acquired EBITDA was in a high level in Q2, as can be seen on the graph to the right, at 85 million SEK. Also looking at the EBITDA margin of the acquired companies, it was on a margin accretive level of 17.6% for the quarter and 17.5% rolling 12. Good to note that this includes transaction costs, so the underlying margin is even higher. Our business areas are proactive in the acquisition work and building pipeline. Our business segment leaders are spending more time on acquisitions now compared to a year ago, and the current acquisition pipeline is on a high level. By that, I leave the word over to Patrick to comment more on the financials.

Thank you Bo and Bo has already talked about many of the KPIs but good to highlight is also the year to date numbers with order intake and net sales up 8% and 6% respectively. Gross margin strengthened in the quarter and also year to date and as Bo described our companies they are successful in transferring price increases to the customers so that's really good of them. EBITDA and EBITDA margin was strong in the quarter and even if and even higher actually if you exclude the negative effects Bo described regarding revaluations of earnouts and they are connected to one company performing better than expected which of course clearly is a good thing and if you exclude this revaluation the EBITDA margin would have been then 14.9 in the quarter Year-to-date we are on 14% in line with our financial target. Finance net decreased 4% in the quarter and 11% year-to-date mainly due to lower interest rates. Tax cost increased 22% in the quarter and 14% year-to-date as a result of the higher profitability mainly. Strong growth in earnings per share of 23% in the quarter and 10% year to date and I will talk about that a little bit more on the coming slides. Return on capital employed same level as we had in Q1 on 18%. Operating cash flow improved on the back of the higher result that was up 20% in the quarter and is up 10% year to date. And finally Nettet EBITDA was on a controlled level of 1.7. So let's look in more detail on the cash flow. Cash flow from operating activities improved 20% as I said mainly due to the higher result. Inventories were in line with last year, but working capital in total is up slightly, primarily due to increased receivables coming from the higher invoicing pace. Cash conversion continued to be very strong at 137% in the quarter and working capital efficiency took another improvement step. And looking at the EPS, following a soft development for some time, EPS improved significantly in the quarter, up 23%, actually on an all-time high level. And of course taking historical share splits into consideration. Main reason is obviously the higher operating profit but also the lower finance net that I talked about helped as well. And looking at the more long-term perspective the three-year CAGR it was minus two coming from a strong level than 2023 and plus seven percent looking at the five-year CAGR. and lastly looking at the financial position and the net debt that is seasonally high in quarter two and due to the dividend payout of course it increased versus last year because of the increased acquisition pace however our net debt ratios are stable and on a controlled level net debt equity on 55 percent compared to 52 last year and net debt EBTA slightly higher than last year and it came in at 1.7 and if you exclude earnouts it is on 1.6 compared to 1.4 last year and the financial net debt which is then the part of the debt that relates to borrowing that needs to be refinanced is also low at 1.2 In conclusion, our financial position is strong, creating good room for continued value creative acquisitions and also organic growth initiatives. I think this is also confirmed by S&P who actually upgraded their outlook for us from BBB- with stable outlook to BBB- with a positive outlook. So by that I leave over back to you Bo.

Thank you. We recently announced some changes in the group management where we have recruited two experienced and well qualified persons. First we have Anna Vilogorak who will be the new CFO of Indutrade. She will assume the role no later than January 14th, 2027. Anna has a broad experience from senior finance positions in global listed companies, combined with deep expertise in capital allocation, business control and strategy. She is currently the CFO of Ratus AB, having previously served as CFO of the Nuent Group. In addition, she has had many roles within Sandvik, working with Group Strategy and M&A before taking on senior finance positions, including Head of Group Business Control and CFO of the ROC Processing Solutions business area. Then we have Håkan Svensson, who will be the new Head of Business Area Infrastructure and Construction from August 1st. the current head will continue as a business segment leader within Indutrade in another business area. Håkan is not new to Indutrade. He was actually the managing director of our company Bengtsson Maskin back in the year 2000. Since then, he has continued to successfully manage companies in different situations and geographies, including being the CEO of the Darien Group, an EVP of Södra and various positions within Dow Corning. I'm very glad to welcome Anna and Håkan to Indutrade. I'm confident they will be highly valuable as we continue our journey of sustainable profitable growth. Lastly, some key takeaways before opening up for questions. Strong top line growth in the quarter despite the strong net sales. Order intake was even higher resulting in a positive book to build in the quarter. Also EPS growth was strong. All time high EBITDA and EBITDA margin improvement with good operational leverage and strong gross margins. Looking ahead, we have a larger order backlog and good acquisition momentum, but the general market uncertainty remains on a high level. Nine acquisitions so far in 2026 and a continued strong pipeline, providing good conditions for a continuously strong acquisition pace. We delivered on many of our financial targets in the quarter and are fully focused to keep the momentum going. Thank you.

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. The next question comes from Op Otani from Goldman Sachs. Please go ahead.

Good morning, Bo. Good morning, Patrick and Martin. Thanks for taking my question. Three for my end, just on order book, margin and M&A. So firstly, an order book. I appreciate we've talked about a grand order book for a few quarters now, but could you give an update on lead times just in the context of the larger order book in this quarter? And secondly, could you just give a bit more detail on what the performance in life science is? Is that just a large customer or is it sort of broad-based across the life sciences group?

Yeah, we have had part of the order book with longer lead times. partly in the life science area and partly in the energy segment. But quite a lot of the deliveries in the link to this order book will happen in quarter three and quarter four now, I would say. So yeah, that should be a strong platform for good sales situations in those segments in the second half of the year here. And the life science was broadly, I would say strong in medical technology companies. In the previous years, I would say life science has been mostly driven by sales to production related sales to the pharmaceutical companies. And now it has switched a bit to our med tech companies selling products which are used in hospitals and laboratories and research institutions. We had some sort of locomotives in that area, but it was The sales growth was not or the order intake growth was not purely driven from that. But the Polish market is interesting and strong. I would say it's a bit under invested versus other Western European markets countries. So there is a strong investment phase which has started and will continue for some time. And we bought the company in the Polish market 2016, and since then we have done some other activities and we have a continued strong acquisition focus on the Polish life science sector. So I think that's the answer to your order intake question.

Thanks very much. And just two quick ones on margin and M&A. On margin, could you just break out how much of that was operating leverage versus margin accretion from M&A, but also maybe just give a comment on price cost given the pricing headwind you're facing in the quarter, also by some pricing on your side as well.

Well, if we start with the gross margin, it was slightly better than a year ago. I think we had 35.6 this quarter and 35.3 the last one. So a slight improvement in terms of gross margin. And I don't know if you can, Patrik, better than me answer the difference or balance between operational leverage organically and acquisitions.

Yeah, I can try. I mean, we have the good leverage on both the organic side and the acquisition side. I think the biggest driver, I would say this quarter for the margin improvement is the organic one with the organic sales increase of 5% and organic profit increase with 11%. So there you have your biggest driver, but acquisitions also contributed.

Okay, and do you have an outlook for sort of price cost going into H2 or is it sort of similar dynamics in Q2 until end of Q1?

I would think it's fairly similar going forward in the second half.

Okay, and thank you very much. I just lost an M&A. Any change in terms of pacing of deals? I know sort of you paused them slightly. At some point last year, it's kind of more linear in terms of when they happen for the coming quarters.

Yeah, but now we have a strong pipeline and right now less hesitation in terms of finalizing projects. So the expectation is that we would continue in a good pace also in the second half of the year.

Great. Thanks for taking my questions, and best of luck for the summer and the coming quarters. Thanks.

The next question comes from Max Bako from SEB. Please go ahead.

Thank you, operator, and good morning, Bo and Artrik. Thank you for taking my questions. Perhaps starting with the infrastructure and construction segment, as you mentioned, you are cautiously optimistic here for the second half and I suppose that has to do with the book to build actually being slightly above one. So two questions on that segment. First, are there any specific sub-segments or sub-end markets that are perhaps trending in the right direction? And then also with, as you said, Håkan coming in as new vice president for that segment, do you see any changes that will be made or will it be business as usual?

I think it's broadly a better better momentum in several countries in terms of infrastructure and construction coming up now. There has been quite a lot of delays in projects. In the first quarter, it was quite a lot of weather-related issues. Installation companies had to delay that, and now obviously there is PRIMETIME TO DIG IN THE GROUND AND WORK WITH OUTSIDE INSTALLATIONS AND THEN JUST THAT THE MACROS ARE STEP BY STEP TRENDING IN THE RIGHT WAY SO YEAH WE SEE A BETTER AND BETTER MOMENTUM BROADLY AND THERE ARE SOME I WOULD SAY WATER WASTE WATER IS A SEGMENT WHERE WE HAVE VERY STRONG POSITIONS AND where we expect good growth. And there are other areas as well where there's been a bit subdued situations. So no, it's step by step, just a better broad improvement, I would say. But it's not going to happen overnight. It's step by step and sometimes smaller steps as well. Håkan and you are both good leaders. They have slightly different leadership styles as we all have. And to use a bit of a sports analogy, sometimes it's beneficial with with a new voice in the locker room. And Juwa has managed the business area through a phase of a lot of cost reductions and some divestments. And now it needs to be a phase with revenue growth, business development, strong focus on sales. And I think this shift will be beneficial in that perspective.

Sounds good and then turning to the technology and system solutions segment. You said the same thing there I believe that you're cautiously optimistic here for the second half and I think we have seen now three quarters in a row with the book to build above one and quite a bit above one here in the last two quarters. If you could just touch upon the lead times and How soon should this potentially then translate to a bit more positive organic earnings growth for the segment, if you have any thoughts on that?

Yeah, as you remember, we had an unfortunate situation in quarter four in that business area with two UK companies which had some mismanagement in them and That is impacting the business area quite significantly and there is transformation of those two companies ongoing and it takes a while to go from one sort of niche orientation which they had to going back to more of their original business platform. So I really hope that towards at least quarter four, we will see first signs of financial benefit from this transformation. So if you exclude some of these problematic companies in that business area, the earnings quality is actually good. So it's more specific, a small number of specific companies holding them back right now. And there is intense work going on to rectify that situation. And as all of you know, It takes some time to transform companies. There are new MDs in these companies. Since some months back now, we have had really strong support from also outside help to kickstart focused agendas on these companies now. So I'm optimistic that we will see improvements, but maybe more towards the later part of the year than in the beginning of the second half here.

Okay, perfect. Focusing a bit more on this specific quarter Q2, I mean you have mentioned it and we see it in the numbers it was very broad based the improvement but is there anything extraordinary in the quarter that supported the outcome in terms of project completions or something similar that could be relevant to be aware of?

No, not on Indutrade group, not significant on a group level. There were some drivers in specific business areas. So for process energy and water, we see strong sales into the energy segment and gas power plants. But that will continue also in the second half, even stronger in the second half, I would say. And in the life science area, I spoke a bit about this Polish market, and that's been strong and equal to process energy and water. I think that will also continue in the second half of the year.

Okay perfect and then the final question a bit broader perhaps but as you stated during the presentation very very healthy M&A activity here during the first half of 2026 and it seems like you're quite upbeat here on the second half as well and this of course would mark a quite clear acceleration versus the previous two years that as also mentioned previously, were perhaps burdened by the organizational changes that were made and then also perhaps a more hesitant stance due to the geopolitical turbulence and so on and so forth. So the question being is basically, do you feel that the organization is fit for fight to now maintain acquisition pace more in line with the historical average for in the trade?

Yes, I would say even stronger than the historical average. We have a very strong platform now and the focus is also clearly there and the understanding of the importance of a strong pipeline and We have step by step, I would say, built capabilities on generating leads and deals ourselves rather than relying on external brokers to the same extent as before. So I think the platform is stronger than ever now.

Perfect. Very clear. That was all from me. Thank you very much and well done.

Thank you so much.

The next question comes from Carl Boakvist from ABG Sundahl Collier. Please go ahead.

Thank you. Good morning. Max took almost all of my questions, so I'll see if I find something else here. But what I was wondering was on infrastructure and construction. You've done a lot on the cost side, and I'm just curious to understand here if we still get, let's say, kind of limited organic sales growth, Do you still have more benefits to come that would support a margin increase?

A relevant, interesting question. We start to be a bit limited in terms of driving performance with cost reductions. one additional smaller step, but it really needs to come more and more from the top line now, I would say. If that answers your question.

Yeah. All right. And then on PEW here, there's been some comments before, at least on some customer hesitancy and now this quarter it was it was up year over year and in Miljansek it improved sequentially as well. So is this, can we say something about customers now actually coming back to the negotiating table and placing orders now to a greater degree?

Yeah I think they have placed orders for some quarters now but The sales haven't really been realized. Some of them have had longer lead times and so on. The outlook is quite positive for that business area for the second half of the year and going forward. There are some strong underlying drivers on the energy side. We see both benefits using gas gas-powered power plants linked to solar and wind, which is not always the sun is shining and the wind is blowing. And you see some of these plants being updated to also manage hydrogen. You see investments in this area now linked to what has happened in the Middle East recently. So I think there is a strong underlying sort of demand for that continuously for some time. And then that business area see more and more opportunity, I would say, linked to data centers. They work a lot with flow equipment, as you know, and both when you actually build the facility, there are different types of flow equipment needed for the general facility, but not least also for the cooling systems. So some of the companies have opportunities in that area. And we also have some companies who have had, I would say, the emerging interests from some defense customers also needing flow-related equipment for different application areas. No, it's an interesting business area, definitely, and we have strong market positions, high-quality brands and products, so good platform to stand on there.

Understood. That was all from my side. Thank you.

Thanks.

The next question comes from Johan Lankvist Sundhien from DNB Carnegie. Please go ahead.

Hi Bo and Patrik, thank you for taking my questions. The first one is a little bit going back to the discussion of the life science segment and just to get a feeling for how sustainable the growth pace is that we're currently seeing. Can you please give some more color on where you are, where we are in the kind of ramp up, ramp down phase on your kind of Novo Nordics exposure, for example, and how much of a one-time element is that and how much is kind of sustainable in the longer perspective on the growth side there?

Yeah, I think overall it's It's a quite sustainable situation for that business area. But between years, drivers can change a bit. And as I said, for the last two or three years, we have seen a lot of production equipment to pharmaceutical producers being sold, as you understandably also have identified a lot of Novonodisk. but also to the Irish market, a lot of pharmaceutical companies producing there. And both these two takers, if I say the Irish cluster being a taker and Novo Nordisk another taker, has had definitely lower demand the last year. I'm slightly optimistic actually that that could be a bit of a increased phase for certain application areas for the second half and maybe next year. So if anything, maybe a slight increase linked to that customer and maybe the Irish market is a little bit more stable as it is for some time linked to the U.S.-European trade situation. Then we have also had a good demand from the single use area during COVID and then a sharp decline because they had a lot of safety stock. Now we see a fairly good situation in that market as well. And then broadly, there are actually quite a lot of medical technology companies selling products into hospitals or even products patients are using on them. And that's also broadly quite strong. So I think we have a very good platform and we are not dependent on single companies or single locomotives in that business area.

Thanks for the call, it sounds promising. My second question is on the kind of cost side. We see in this quarter that revenue starts to grow faster than your SG&A cost items in the P&L. If we look into the second half and potentially into 2017, any reason not to assume that this kind of decoupling from say the revenue growth versus the SG&A cost to continue as you have ramped up cost quite a lot over the last few years or anything that any area where you see you need to add on more cost that we should be aware of?

Oh no the cost There's not going to be any sort of cost increase on group level or business area level of significance. It's linked to the companies. And if you're a growth company, you should add more direct people if you need to in your production or whatever it might be. But I think We are at the level where we should see benefit actually from top line and SG&A will not increase in 100% correlation to that for sure not. So more of a decoupling if you call it that.

Yeah, or a good operational average at least on incremental volumes.

Yeah.

Perfect. Those were my two questions. Thanks, Opo. I'll get back in line.

The next question comes from Opo Tani from Goldman Sachs. Please go ahead.

Hi. Hi again. Just two clarifications from my end. Do you mind giving a sense of the Polish market within life sciences just to get a sense of how large and significant it is there? And then I think you kind of talked about the data center and defense exposure already within process energy and waste. But could you give a sense of sort of, are these orders where you're already seeing firm commitments or it's sort of upside potentially in coming quarters and years to go through in that segment? Thank you.

Yeah. The Polish business right now is not super significant for the whole, the total business area, but the growth rate has been high enough for some time and we see that they, The plans the Polish government has and a lot of private institutions in the Polish market has are stronger than what a lot of the other Western countries have, which are more up-to-date in terms of equipment. So it's just a very promising market for a phase of several years going forward. It's both interesting in terms of organic growth based on the presence we have, but also I would say interesting for further acquisition activity into that market. And your question regarding process, energy and water, I would say right now the gas power plants are the stronger driver versus data center and defense. What we have seen in terms of data center and defense is more Maybe not embryonic, but promising signals and potentials going forward. Another strong segment for that business area is the marine area, actually, where we made quite a significant acquisition in the Netherlands during the spring here. 35 million euro company with strong international sales. And we already had a Swedish company with a manufacturing facility in China, which is also quite large. and we bought actually another niche operator in the Netherlands as well in that segment. So we have a cluster of companies in the marine area which is also promising and a growth provider for the future. So there are many pockets of opportunities there.

Thank you very much.

The next question comes from Zeno Englund Rick Tjudi from Handelsbanken. Please go ahead.

Yes, good day and thanks for taking our questions. Two short ones from my side. Firstly, on the order intake, you similarly to previous quarters, I think, comment that just over half of your companies have seen an increased order intake. Could you share a bit on the more underlying is it that your larger companies tend to be the ones that are growing more or how should we look on that dynamic?

I wouldn't say it has anything to do with size. It doesn't really either have anything to do with if it's a trading company or production company. It's more what customer base you have and actually if there is underlying demand and if the company is really on their toes in terms of working with business development, which basically all in the trade companies are obviously. But no, there is no size dimension which is standing out in that perspective.

very clear and on the M&A side you briefly touched upon that you're relying a bit less on brokers. Could you talk a bit more about the internal flow you are seeing and how it has developed? You've been clear since the 2044 basically that this will be gradual and where do you see that you are on this gradual journey when it comes to inflow?

It's different phases in this work. An initial phase is about, you know, we have defined 30 plus segments we are active in, interested in. And more broadly, we are also very optimistic in terms of good companies. So we will always find a home for a good company. company which fits our criteria. So now we work with utilizing the network we have with the customer basis, supplier basis, peers in industries. So the personal networks we have, and then we add, I would say, AI generated lists of relevant companies for all these segments and the second phase is to start to build relationships with these companies and obviously not all of them are in a situation where they want to divest right now. So that relationship building can go on for one to 10, 20 years, I don't know, until something is up for sale. But when it is up for sales, we want to be in a pole position to be a real contender to acquire that company. And most of that early phase of using our network and using AI and so on, is in place, I would say now. So it's a lot of relationship building going on within Indutrade right now. And sometimes you're a little bit lucky and you take contact with the company and it's actually for sale or will be for sale within very short. But that's a minority, obviously, of the contacts we take. Most of it is establishing something with potential for the future.

very clear and just a quick follow up on the comment there on the AI generated list. How do you view sourcing work over time since I guess this AI generated list over time will become more of a commodity when it comes to other acquisition driven companies like yourself looking for this niche good to companies?

Yeah, Dan, if you have identified a company which fits to our criteria and you have a dialogue, then obviously, usually the seller will compare a few different buyers with each other and then it's extremely helpful to have a 50 year history to have You know, basically a very strong brand in this perspective. We have no scandals, no issues. We've always been profitable and we have a quite large smuggles board of different things to offer a seller being part of Indutrade long term. in order to help that company take a step from 10 million euros to 20 million euros. We have real credibility to help them do that. And they can talk to 200 other MDs who are part of Indutrade who can testify to that. And if you compare that to a an acquiring company who was founded three, four years ago with less history and a smaller smorgasbord. I think we are usually in a very strong situation when it comes to those competitive situations.

Very clear. Thank you. Those were my questions. And also, I want to wish you, Patrik, all the best for what comes ahead.

Thank you.

As a reminder, if you wish to ask a question, please dial pound key 5 on your telephone keypad. The next question comes from Gustav Bernebled from Nordia. Please go ahead.

Yes, good morning. It's Gustav here from Nordia. Just a quick one also for me. If we start with industrial and engineering, just to get a bit more conviction in that margin development year over year, you know, 170 basis points is Is that, would you say, purely driven by volumes or is there a sort of meaningful impact also from a temporary mix effect or anything, just to get more conviction how sustainable it is?

I wouldn't say it's... temporary mix effect. I think it's more of a broad top line based leverage benefit, I would say. So this is where we should be and plan to be also going forward.

That's very clear, thank you. Just to build on Sina's question here on M&A and sort of internal sourcing and so forth. I think you commented in Q1 that two out of three acquisitions there was sourced internally. Is it possible to give an updated figure on that? And also, if you compare the M&A pipeline as you have now versus entering the year, would you say that total EBITDA in the pipeline or number of acquisitions is larger now than it was entering the year?

I don't want to give you any exact numbers between what's external and internal source, but the internal source is step by step improving, increasing all the time and I would say that the pipeline is also on a very... It's a strong pipeline right now, and it's broad-based basically in all business areas, except for infrastructure and construction where we also have a pipeline, but there has been more transformational work there than in the other areas. Part of that area is a little bit more cyclical than others. We don't want to enter into clearly very cyclical businesses. We want to avoid that and have more of a stable profitable growth outlook when we acquire something.

That makes sense. Thank you very much, and I wish you a good summer.

Thank you so much.

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

Then I would like to say thank you from our side as well. Great questions, good discussions. And I also want to formally thank Patrick for eight plus years within the trade, done a fantastic job and we wish him all the best in his new role as well. So thank you all and have a nice summer.