Instalco AB (publ)

Welcome to the Instalco Q2 presentation 2026. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to the speakers. Please go ahead.

Okay, welcome to this presentation of Instalco's report for the second quarter of 2026. And my name is Per Sjöström, I'm CEO of Instalco. And with me today is our CFO, Kristina Kasperger. And for the Q&A part, our head of IR, Matilda Eriksson. In short, I will say that we see the effect from the changes we have implemented and that Q2 is an important step for Instalco in the right direction. So, as always, I will start with a short snapshot of Instalco today. We are the leading installation Group across the Nordics with an established platform also in Germany, which I will get back to in this presentation. Our strength is our decentralization, local companies close to customers combined with common standards, tools and governance. And with over 6000 employees, we are exposed to market segments driven by long-term needs such as energy efficiency and electrification. Slide three. First, for a quick glance at our LTM numbers, where the majority are taking important steps in the right direction. Net sales amount to 14 billion, as you can see, and we ended the quarter with a backlog of almost 11 billion. This represents a steady book to bill of around 77%. And on top of that, we have our service businesses, which made up 35% of sales in the quarter. Our EBITDA for rolling 12 months amounted to 927 million, corresponding to a margin of 6.6%, a continued step up compared to Q1. And despite the somewhat weaker cash flow from operations in Q2, we maintain a high cash conversion at 90%. So let me start with a brief summary of the quarter. First, we delivered strong organic growth across all the segments. That reflects a market that is gradually improving, but also that we are executing better across the group. Profitability also improved compared with last year. We are seeing the benefits of better project selection, stronger execution and increased operational discipline. Our order backlog strengthened further during the quarter, giving us a solid foundation for the coming quarters. The market picture is still mixed, but activity continues to develop in the right direction. And finally, Instalco 2.0 continues to gain traction. The work we started last year is becoming part of how we operate every day, and we are seeing the effects in more parts of the business. And I think that was the big picture, Kristina. Let's dive into the numbers.

Thank you, Per. I will start with looking at net sales and order backlog development during Q2. Net sales grew by 10.3% to almost 3.9 billion. Currency had a slight positive impact on the outcome. Organic growth, on the other hand, remained positive and strong at 8.4%, and we saw growth in all three countries. When looking at where the most growth came from, we can see a strong increase from companies working with industrial clients. Geographically, the biggest sales growth came from west and south of Sweden as well as Norway. Our order backlog also reported even more growth of 17% or 14.8% organically. The backlog increase was primarily driven by Norway, but also came from Sweden. In addition to the backlog, service continues to provide a solid foundation for the business. In the quarter, it amounted to 35% of sales and we delivered growth in absolute numbers of 9% in our service business, driven by Sweden and Norway. Then moving on to earnings. EBITDA grew by 22% to 274 million, corresponding to a margin of 7.1% compared to 6.4% a year ago. Last year, Q2 had a one-off cost of 11 million. Adjusting for these, the comparison margin amounted to 6.7%, and still, this year is still better. The year-on-year development reflects both improved operational performance and the higher volumes in the quarter. Margins improved in most of our business areas. The biggest improvement year on year came from industrial facing companies, as well as the north of Sweden and our technical consultants at Intek. We are not yet where we want to be, but the quarter marked an important step in the right direction. Next, I will look into each country in more detail. First up, we have a look at Sweden in Q2. Overall net sales grew by 10% to 2.8 billion with an accelerated organic growth of 9%. The order backlog increased even more by 13.1% compared to a year ago to 7.5 billion. The EBITDA increased to 197 million corresponding to a margin of 7% compared to 6.6% last year. The stronger margin and improved earnings reflects higher volumes and operational improvements supported by a gradually improving market. The Swedish market continued to improve during the quarter and the signs of recovery are becoming clearer. Activity is increasing, especially in the larger cities where more projects are now moving into the execution phase. In Stockholm, this is especially true for somewhat larger projects. We are also seeing early signs of a recovery in the residential market, although from low levels. At the same time, development remains uneven across regions and customer groups. And now for a summary of Norway. Overall net sales were up to 625 million and organic growth amounted to 4.9%. FX effects impacted positively. EBITDA amounted to 42 million compared to 36 million last year. This corresponds to margin improvement from 6.5 to 6.8%. We are proud that Norway managed to showcase both growth and improved earnings despite experiencing delayed start dates in several projects. This is due to permitting and decision processes. This is a timing issue rather than loss demand. And our subsidiaries have managed to navigate these new projects to cover the other by slower utilization. Norway showed a continued very strong development of the order backlog, which increased by over 40% compared to a year ago, or 35% organically. The Norwegian market remains challenging, but we continue to see signs of a gradual recovery. Activity is strongest in Oslo and the southern parts of the country, supported by public investments in hospitals, defense, infrastructure, and data centers. The residential market remains weak, while commercial projects are developing more steadily. Competition is still high, but pricing has become more rational than before. And last but not least, a summary of Finland. Net sales grew by 8.6% to 432 million, organically by 9.3%, with a negative impact from FX. The order backlog decreased slightly by 3.8% compared to a year ago or minus 3.3% organically. EBITDA amounted to 35 million compared to 30 million last year. This corresponds to margin improvement from 7.3 to 8.1%. The improvement was primarily driven by a continued, fairly strong contribution from companies delivering projects for the industrial customers, while performance in the Finnish installation operations was more subdued. The Finnish market remains weak, but we believe it has reached the bottom. Residential construction and larger private investments are still at low levels while industrial projects and renovation continue to drive activity. We do not expect a broader market recovery in the near term, although market sentiment has improved somewhat. At the same time, investments in the energy transition, defense and digital infrastructure continue to support demand. Data centers are also becoming an increasingly important growth area in the Finnish market. Before I hand over to you Per, let me briefly touch on our cash flow. In Q2, cash flow from operations amounted to 104 million, which was weaker than the same period last year. The main reason is that more capital was tied up in accounts receivable, following the strong growth and high level of invoicing towards the end of the quarter. Importantly, we have not seen a corresponding increase in overdue receivables, which gives us confidence in the underlying quality of the receivables book. Strong cash flow and healthy balance sheet remain key priorities for Instalco and we continue to maintain a disciplined approach to working cap, capital allocation and selective investments. Yes, that concludes the financial review from my side, so Per, over to you.