NIBE Industrier AB (publ)

Good morning, good afternoon, whatever it means to you sitting out there. We are back and we're going to give you like 20, 25 minutes presentation of the report. And then we're going to, of course, invite you for questions. Just a couple of things. We have to finish around 12 because we have other tasks to fulfill today. And also we would ask you to only put two questions at a time to allow as many as possible to get their questions across.

Yeah. Hello also from my side, Hans here, and I'll be happy to fill in where Erik hands over.

Okay, fine. Well, the overall headline is, we believe it's a strong report that demonstrates both, of course, the growth in revenue and the profit and also margin wise. And that's a six consecutive quarter So we might say it's a trend anymore rather than just a quarter coming alone. So we're bold enough to suggest that. And we've given a few hints here on the slide that you have in front of you. And that is, of course, that it's less pronounced with the Swedish crown this time. It's more like par with the, here we go, There we go, with the previous similar quarter or corresponding quarter. We also talk about tariffs. Of course, we have to do that, but they've been fended off fairly well, but for stoves. We're going to come back to that during the presentation. And we see also trend towards more renewable attitudes, both in Europe and also in North America. Also something that we're going to comment more on when we come back to the quarter per business area. And then, of course, we're very pleased to see that our assortment now is so well received and our presence is appreciated, of course, both national and also international. And we keep the good cost control, although we see that things are improving. It's very tempting to perhaps increase costs. We have to have that discipline. And also we see that our investments in new facilities have given us a good productivity development. And they're sitting there, we are just idling now to fulfill the demand that we believe is going to come for the years to come now. Just a quick glance at the figures. You have them before, of course. The growth there of the 7.6 organically, that is really 8.7, which is a healthy growth. And it's also the gross margin that's improving, which is pleasing to us, demonstrating that we are polishing in our cost and keeping the cost discipline. and the operating profit speaks for itself, but also that the operating margin has taken a considerable jump compared to the corresponding quarter last year. And the graphs that we typically have, that's also indicating that we are now on a stronger path towards the revenue. And we also see, I'm sorry, the profit of the financial items, and that is of course a function or of several factors, the sales improvement, also that we have a pretty good cash flow. We borrow a little bit less or quite a bit less than we did a year ago. So all the things are working in the right direction. If we talk about climate solution, we've already mentioned that, that the market is solid when it comes to improvements. And it's very pleasing to see that in Europe, both the single individual home market for heat pumps has increased, and that is particularly for renovation, of course. The new construction is not So prosperous until now anyway. And also the commercial segment is expanding. In the US, as expected, the single family home market for heat pumps went down when the subsidies were taken away. But nevertheless, the commercial segment is really outnumbering that. So overall, we still have a growth there. Also, that we have also these political uncertainties that we mentioned initially, but when it comes to looking at it in the US with the manufacturing there, they will really have an upper hand, so that's a good thing. Of course, people are affected by the political situation, but I also think or believe, which is sad in a way perhaps, that people are getting used to these things and eventually we have to continue to live So we feel that there is an uptick in demand and in positivism in all three segments, really. And that, I think, has to do that eventually you get fatigued listening to all these problems. You just have to continue living. and again the product launches have been very very efficient and successful and that fills us with the satisfaction naturally that people are looking for better refrigerants and intelligent controls for energy optimization and so forth so we feel we are really on the right track in investments we have them the larger ones behind us now that's not something that we going to start now they are installed ready to take on the challenge And very quickly, Hans is going to come back to more detailed figures when it comes to gross margin and such. But it's important to note though that the real underlying growth here, if we take away the effects of the currency, is around 9%. And the operating margin is now up well into the the spectrum, whatever we call it, or interval that we really aim for between 2013 and 2015. And of course now we have on a running basis 12.2, so still a little bit to go, but that's quite a bit better than the corresponding period the previous year. Swinging over to Element, and there we really have had a positive development, and that is particularly for the semiconductor segment. Everyone talks about the segment, you know, AI and all that, and here we are positioned so well in North America with our subsidiaries delivering components to those manufacturers that really stand behind the manufacturing of the chips themselves. and they of course predict a steady growth in the future and now we have gotten a sniff of that and that is of course one of the major factors behind the growth. But it's also that the HVAC market is certainly coming back and that also has a positive effect on element. However, of course, the new construction that is still slower in Europe and elsewhere. And of course, when construction is slower, that is dampening the whole mechanism in society. Construction drives the whole society. So that's when it comes to the home appliances and stuff like that, that is of course still limping along. And just jumping over to the next, I'm too quick. No, here we are. I'm sorry. There we are. Again, the net sales, quite an improvement. And of course now we see a growth of organically 11.6 and even outnumbering climate solution. And then on top of that, we have a couple of percent of growth when it comes to acquisitions. And very pleasing to see that our operating margin is back within the interval again, 8.9 versus 6.6. That's quite a hefty improvement. And we're very pleased to see that. And also the gross margin has taken a good step, which Hans is going to come back to and explain. I've said that earlier during interviews today, that we would have liked to have this discussion or this press release or press conference two days later, because we don't really know what's happening on the tariff side in North America. That is, of course, very, very important that that is mitigated somehow. We have had those tariffs and and then they were worsened in April this year. And of course, we hinted about that going to be difficult to mitigate that. We feel that in a little bit longer time, we will be able. But now we know that negotiations are going on between Canada and the US. And as long as people are negotiating, there's still hope. and hopefully at the at tonight their time they will have reached some kind of agreement and we are we hope that the terrorists will be eased off a little bit we don't know they certainly won't be hardened to any respect so what we see now what we described is the worst case and we thought it was well you know, were thought out to present that to you. But we hope that after the negotiations tonight, that we're going to come back with some better news. And despite headwinds, we dare to say that demand has started to improve a little bit. And we see signs in Europe of improvement in demand. Not so strong, but still, we had an organic growth around the 2% during the quarter. It's been more stable in North America, we must say. and whether they are not so anxious as we are in Europe or what's behind that, we can't really tell. But it seems like their market has been more stable altogether, both in Canada and in the US. But it's very promising to see now that we believe that we've been down at the very bottom also on stoves. and we on a second quarter that's very pronounced as we all know the seasonal pattern for stoves and we just hope that we're going to have a real come back now during the coming six months or come let's say five months as of today of course. So that's a little bit about the stove situation and here We have the figures. The operating margin is still negative, but a considerable improvement from the previous quarter corresponding year. So that's why we are fairly optimistic about changing this into a decent result. IF THE 25% TERRORISTS WOULD REMAIN, IT WOULD BE A BIT MORE DIFFICULT TO OF COURSE MITIGATE THAT IN THE IMMEDIATE FUTURE. BUT WE ARE FAIRLY OPTIMISTIC ABOUT LOOKING AFTER THAT. SEE WHAT HAPPENS TONIGHT. Just a few more pie charts. Excuse my language, excuse my voice. Here we have the distribution of sales. Of course now Stoves has not been able to grow, so that's a very obvious dominance by the Climate Solution and eBay Element. And when it comes to the operating profit, of course, that is now all taken care of by Climate Solutions and Nibe Element with the 78 and 22%. We hope to change that pie chart fairly quickly. And I think with that, that is the last pie chart that I have. The Nordic countries slightly under 20%, rest of Europe 45%. and North America, just about 30%, and then Asia, 7%, which is predominantly element. Hans, I hope your voice is better than mine.