Nederman Holding AB (publ)

Good morning, everyone, and thank you for joining us today, taking the time not sitting in the fabulous sunshine in this, at least in this part of Sweden. The second quarter was encouraging for Nerman and our owners. We saw a clear increase in customer activity and a strong order intake across all four divisions. This confirms a positive trend we saw at the end of the first quarter. You remember the first part of the first quarter wasn't that great. Market uncertainty persists, but we continue to see customers investing in areas that are important for their operations. It's also encouraging that the investments we have made in innovation and operations over the recent years are creating results. This is strengthening our competitiveness and it's also helping us gain market share in traditional and new industries. During Q2, orders received increased in all four divisions. Extraction and filtration technology, which is the biggest division, had record order intake. Monitoring control technology and duct and filter technology had the highest quarterly order intake since Q1 last year. We also see continued growth in our service business. It's a focus area and it's very important for recurring revenue and long-term value creation. We continue to advance our innovation agenda through new product development and releases that address our customers' need for cleaner production, improved productivity and safer work environments. At our Helsingborg Innovation Center, we are building unique dust analysis capabilities, which will improve both our products and our customer safety. This initiative is generating interest in the market and has also been highlighted on Swedish national television and radio. As part of our agenda for market leadership and focus on Australia, we acquired the business of our distributor of human dust control. We now have a clear presence in Queensland and this acquisition confirms our ambition to grow in a market with significant future potential. Profitability in QT was affected negatively by the lower order intake at the start of the year, as mentioned before. But our operational focus remains strong. We have continued to improve efficiency throughout the organization and maintained a high level of cash generation. Overall, the quarter reinforces our confidence in the direction of the company. We are well positioned to elevate our market leading position and continue creating value for the shareholders. With that, I hand over to Matthew, who will take you through the financial performance in more details.

OK, thank you. So moving on to the key financials and starting with orders received. Orders received, as we mentioned, picked up at the end of Q1, and this has continued throughout the second quarter. Strong flow of orders across all divisions, particularly small and mid-sized orders. No huge mega orders in process technology division, but growth in all four divisions nonetheless. Total order intake for the quarter was 1.48 billion krona, up from 1.425 billion last year. That's currency neutral and organic growth of 6.3%. What more can we say there? The currency effects are becoming less now. We've seen at least at the moment a relative stabilization of the US dollar and the euro against the Swedish krona. I did say relative there. Orders received, if you see on the presentation, the chart in the middle, you can see that this is the second best order intake quarter. since Q1 of 2024, and that's at prevailing rates. I was playing around a little yesterday with looking at currency neutral, and this is the best quarter of order intake since this chart started back earlier in 2023. So very pleasing with that order intake level. If we move on to the next slide and look at sales, of course, we have the weaker order intake, particularly in January and February, and this has affected sales in this quarter we're lacking some volume and it's sales of a 3.7 percent down currency neutral it's it's uh 77 million lower than the same quarter last year so that does impact a bit on profitability so uh on the profitability side we um ended up with a uh and adjusted a beta of 114 million kroner which is 8.3 percent earnings per share for the course of 1.54 kroner versus £197 last year. More positively, it was cash flow. We had a good operating cash flow in the quarter, £69 million positive in Q2 versus £59 million in the same quarter last year. We see on the net debt that we have an increase in Q2 versus Q1. That's typical in their demand when we pay our dividend in during the second quarter. It's paid right at the end of April this time. So that that was one hundred and forty million kroner alone. And that does make some difference on the net debt. We expect this positive cash flow to continue into Q3 and Q4 now. Little bit on the divisions, then I'll keep this a bit more brief than we have traditionally shown so we can. Sven's already told us a lot about the key activities. But if we take extraction and filtration technology first, the largest division record order intake, as Sven already mentioned, the highest quarterly order intake ever. Profitability, on the other hand, was lower. Lower sales volumes related to the order intake. That has the knock-on effect that capacity utilization in our factories is down. We have got very efficient factories and that's something that we ought to see an increase in utilization going forwards, given the excess of orders over sales that we saw in this quarter. Basically, we've grown backlog in all three regions, which is pleasing as well. Orders received 716 million is over 100 million more than the sales of 611. Adjusted ABITA is only 11% in this division. You can yourselves do the maths. If we have a sales of 715 million, I think we can see a rapid pickup in the ABITA margin going forwards. The key activities for ENFT were the acquisition of human dust control in Australia, We're continuing to invest in, it's in North America actually, the major investments now in the facility in Charlotte, North Carolina. We also held a partner royale event here in Helsingborg. We had over 50 European partners visiting us there. Process technology. development in the quarter some currency neutral growth in order intake and process technology that's uh it's one percent there are some markets now that are showing signs of stabilization if we take the fiber and textile market we actually saw growth in the quarter which was pleasing If we take India, for example, we also, on the foundry and smelter side, see the Indian business growing there. We've invested a bit of time and money in that, and that's starting to reap rewards. The service business continues to grow as well, which is very, very important for this division. It has the better margins there. Some larger orders were booked, but it was still on a relatively modest level. Orders 380 million Kroner, sales 390 million Kroner, which is 10 million lower than last year in sales. But despite that, we actually had a slightly higher margin. A beta margin is 8.9%. This shows the importance of continuing to grow the service business. The mixed effect of having more service in there is clearly positive for profitability. Key activities in process technology, still focusing on product development. We're upgrading a test center at the moment, and the digital range is fundamental for this, not least in order to connect it to the service side of things where we see this good profitability development. Moving on to duct and filter technology. Extremely strong order intake in the second quarter here. The order intake picked up in March continued throughout the quarter. Sales increased marginally, but it's not really a backlog business. But despite that, there is a bit of a backlog build up. Very good profitability, good operational efficiency. These investments that we've made in, for example, in Thomasville in the US and also the plant in Assens in Denmark are seeing increases in margins in the factories. If we talk about the numbers, external orders received 194 million, total sales 203 million, and then the beta margin is 19%, which is very pleasing. WHAT MUST BE POINTED OUT THIS IS THAT THIS DIVISION ALSO HAVE BUILT BACKLOG IN THEM IN THE QUARTER THE EXTERNAL ORDERS RECEIVED 194 MILLION ON TOP OF THAT THEY TYPICALLY SELL FOR AROUND 20 TO 25 MILLION TO THEIR UM TO THE OTHER DIVISIONS IN THE NEAR DEMAND GROUP SO UH WE OUGHT TO SEE A SAY A PICK UP IN SALES IN THE IN THE THIRD QUARTER AS WELL HERE UM KEY ACTIVITIES BIM Toolbar has been launched in Europe. It's been very successful in helping us get larger orders in the US, and we're aiming for the same here. Marketing activities have been quite important right now. We've tripled the production capacity for our heavy-gauge ducting in the US, and that business is developing well. It also brings in regular ducting business, and we're highlighting that. We also have now a remote warehouse in Dallas as part of our ambition to improve the fast, friendly, reliable North AB NOW concept a little bit further west in the US. an interesting thing here as well. The solar panel system in Thomasville, which we've expanded further, is now exceeding one gigawatt of electricity production annually, which is actually helping with some decimal points on the ABITA margin. It's a very good business case with solar panels in that part of the world. Monitoring control technology. The positive here was a significant pickup in order intake in the second quarter, particularly in APAC. Both gas, methane, and neon monitors performed strongly in APAC there. As is probably expected, the sales did decline following the low order intake in Q1. Order backlog has therefore increased, which bodes well for the upcoming quarters. We see some clear indications that the market is stabilizing. Nevertheless, orders received were 192 million, which is very good. That's 17% growth. Sales were down at 178 million from 190 last year. The EBITDA margin is then 7.2%, which is a big drop from 14.9 last year. As well as a drop in sales, we had a somewhat negative mixed effect here with gas met portable units. We had fewer of those in the sales mix in the quarter. Which leads nicely on to key activities, actually, because we've GASMET have launched a new GT 7000 TELUS and we've received the first orders for that one that that will help margins once we start getting that up to significant volumes. The Insight Digital platform is being continued to be is continuing to be developed, willing to have a new commercial release later coming later in the year. And we continue in this division to develop in product development is extremely important to do so includes digital solutions we even opened up as well something that's positive a modernized service workshop in houston texas serving the us market we've improved that further there which should help the aftermarket business what we've done it also in in that's not actually mentioned on this on this slide monitoring control technology now have launched their offices in both Korea and Singapore, which will continue to support this growth that we're seeing in the APAC region. There is definite potential for this division over there. Sven might talk about that a little later. So that's a crash course through what the divisions have been doing in the quarter. The financial calendar Next time we speak to you in this forum will be on the 21st of October when we'll talk about Q3 and the year end report is released on the 12th of February. But with that, I think we can open up for any questions that listeners may have for us.

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