Beijer Alma (Stockholm:BEIA B) Q2 2026 Earnings Call

0:00 Okay, ladies and gentlemen. Welcome to this presentation of BEIA ALMA second quarter twenty twenty six. If you hear some strange noises around me, it's because I'm sitting in a sailboat in the middle of the Baltic Sea. It's a old way waves, but no wind. That's why there are some strange note noises. Together with me is Peter Forsloom, is the CFO of BEIALMA, who will present the financial figures.

0:34 Good morning, everybody. On this agenda, I will talk a bit about highlights from q two, and then we'll talk about financial performance, then acquisitions, and finally q and a. And we increased our net revenue by 5% in this quarter, and we have adjusted EBITDA of 14%. If we look at the market and we are working in many areas of the world, and we start in United States where we are with the components.

1:18 It's been a good quarter and we see a strong market in United States and we are as we are manufacturing springs, we are in many many different customer segments, but it seems like in the first half year there's been a strong market in United States and it seems to continue that way. If you go to Europe, that means Europe excluding Nordic, it's been a much weaker market. It's been stable, but really no no no increase in the market. And we have also still some problems to solve from our commx that we work with and and will be not solved probably before end of this year.

2:06 In the Nordic region, we have seen a smaller growth, stable market and also a slight growth (publ) general for for the components and actually a nice growth organically for Beijer in order. If we go to Asia where we have the spring business, it's been a stable (publ) business over the period. Then we took specifically, we talked about Beijer it has been a very good quarter where we have made acquisitions, have had organic growth and we come back to that later on, but it's been a good quarter and, I have some hope for the coming quarters in this year that will continue to be strong quarters for for 2026.

3:04 And by that I give the word to Peter. Thank you, Jani. We'll now go into a little bit more detail both both components and tech, but also a little bit on a general. As Jani mentioned, we see a continued profitability improvement both in components and tech. We have a strong EBITDA growth come out to 14% year over year. We see a stable demand during the quarter and not reaching really the heights of late March from the first quarter, but overall stable and we are satisfied with the performance. John mentioned also U. S. Specifically and U. S. Is the market together with niche within Beijer Alma that has the highest demand.

3:50 We've also seen a very limited effect from the geopolitical turmoil on the Q2 numbers than what happens in the future that let's see. But so far not much of an impact. Great. We will go further. If you look a little bit on the sales development,

4:30 you look at the sales development, we have a slightly organic growth within the quarter and but still some currency headwind. If we look at the components, we have more currency headwind than we have in tech that is fairly neutral. If you look at the organic growth a little bit more specifically, there are still effects from the action plan. We were saying that we're losing around 50,000,000 SEK on top line based on the deals that we have decided to not do in the action plan. So the underlying organic growth is a little bit stronger than the 1%. Acquisitions are contributing than 5%. And please remember that the acquisition the five acquisitions we made this year is fairly late in the quarter. So we'll see that the full impact during the third quarter rather than here in the second quarter.

5:27 Moving on to a little bit more details on BEIA components. If look at the chassis rail business, we see a slightly lower demand in the quarter compared to last year. Specifically, this comes from Germany and from UK. On the demand side, we see a better demand in Eastern Europe, but we see that the business is stable, it's not that much has changed, it's just the demand moving a little bit sideways and a little bit lower, nothing dramatically in Chassis Springs, still good profitability in Chassis. Industry we have talked about a little bit on regions, U. S. Is the strongest and exactly as Johnny mentioned around Europe that we see Europe is stable, but it's not improving and becoming better. So the industrial demand is moving sideways in Europe rather than improving.

6:22 We have the effects from the action plan as we discussed earlier. What is great is that we see a broad profitability improvement over the different regions, not only in one or two, there's broad improvement on profitability. Looking at Alcom X, so Alcom X delivers a stable Q2 results, profitability moving sideways, are still we are very close to double digit, but still not really there. But Alcom X is stabilizing and the performance is solid here in the second quarter. (publ) (publ) Moving then to Beijer Tech. So Beijer has a very strong quarter, 8% organic growth and then five acquisitions. So Beijer Alma is really performing on a high level. If you look at the demand side, specifically in the different segments in Beijer Alma then we see that industrial products, there is still a little bit of a cautious demand when it comes to industrial product, but not bad in any way, but a little bit cautious.

7:31 Fluid, with a solid organic growth. There is a wide range of businesses there in the valves that are performing on a good level. Niche Technologies has had a very, very good year that continues. Several companies are contributing (publ) in a good way. If you look at the profitability improvement that we see in Beijer so that is driven by both demand, but also a little bit of mix where we have sort of say more revenue in the niche technologies and businesses, which tends to have a little bit of higher margins. Looking at BEIA Tech as a whole, we now have a period of twelve months behind us with a very solid organic growth. I think we've had 8% in Q3 last year, 8% in Q4, 6% in Q1 and now 8% here again in Q2.

8:25 So it's a very solid delivery here over time from Beijer Alma Looking at the cash flow side, we come out with a strong cash flow in the quarter, driven first and foremost by the profit growth, but also that we in the quarter sees a positive working capital development, meaning that last year in the second quarter we had a negative working capital development and now we have a positive, meaning that the swing gets fairly significant between second quarter last year and second quarter this year. Looking at capital efficiency, which is one of our financial targets, we are catching in soon to reach the 50%. We see a good development in the capital efficiency both in the sort of adoption internally, but also in the development in the numbers.

9:17 So solid performance capital efficiency, very much driven by the EBITDA growth. Moving over to financial position, net debt stays at 1.7 despite us doing five acquisitions and paying dividend. That's of course helped by the strong cash flow. We see that we have a good financial strength to continue to invest and to reach the set targets that we have. So from a leverage perspective, it's a solid delivery.

9:53 With those comments I will hand back to you Johnny to talk a little bit about the acquisitions that we have done in the quarter. Thank you. As we this is a picture showing the the acquisitions we've done since 2010, and as you've seen it varied over the years, but I think now we have our ambition is to continue to grow the acquisitions, and we have two teams now. One team since many years working with Baytech, but also a new team working with Bay Components. And we are waiting now for them to be able to make the first deal. Let's see.

10:39 If we look at the acquisitions done, second quarter is in in BEIATEC. The first is a Swedish company in Uppsala with an add on to one company we have with Lundgrens. They're working with service with piping service. We made our first acquisition outside the Nordic, and that is a fluid company because we have a lot of fluid competence. So it's by context and and knowledge we ended up this business.

11:17 KeyCab is is actually a company who's doing sludge screw compressors, who is adding to a product program that we have earlier in this area with processing sludge. GR Wood is a Finnish company with very special business, who is an intermediary between supplier of material for refurbishing houses and refurbisher. They make kits of what is needed when you refurbish a house, So the the company is doing the refurbishment, make a specification what they want, and your woods manufacture this, make a package of it, deliver to the to the house that's supposed to be refurbished.

12:10 This is a business I haven't seen in Sweden. It's very very special for Finland, but they have been very sold in the market for a long time, have a nice profit. Finally, it's Steiner who is a valve company in in Norway working to to the oil sector in Norway. And there will I know there will come a few more acquisitions in Beijer Alma in q three as well. So the summary is that it's a stable industrial demand, and we continue to improve our profitability, and we are aiming at a higher level than we are today.

13:05 We have so far not been impacted by the geopolitical turmoil in the quarter. A few price increases on some material, but not in a major in that and not what we have seen with our customers as well. By that, we go over to the q and a. If you wish The next question comes from Johan Dal Dal from Danske Bank. Please go ahead. Yes. Good morning, everyone. Just, John, if you could expand a little bit on components that the team you talked about on M and A, how that how those working processes are progressing?

13:59 And when you think they can start to deliver on sort of the growth would be interesting to hear. Yeah. We we we hired one person from, I think it was first of February, March 1, an experienced person. We have also now released one person in the European organization. So we have now building up a number of cases. But, you know, it takes time to get relations with with different people out in organization, but I hope there will be something in in this autumn. But you never know until the deal is done. Got you. And and also on components, presumably, there will be needed price hikes. I'm sure you did some in Q2 already. But how far have we come in compensating for raw material cost inflation? Is that something that is mainly ahead of you in the second half? Or do you think you've come sort of a long way on actually compensating for for raw mats?

15:08 Many of the the production orders actually is not long term orders. It's an order you take and you you set the prices. That means we compensate from day one for it. So I think we have done maybe 80% already. K. Got you. Thank you so much. There are no more phone questions at this time. So I hand the conference back to the speakers for any written questions or closing comments. I haven't seen any written questions. Have you, Peter? No. There are no written questions at this point in time. I guess many, presentations today.

16:00 But you're anytime you're welcome to come back to us if you have any questions. So thank you for for today, and we'll we hear from each other at least in also q three, and, I wish you a good summer. Goodbye.