Welcome to the Addtech Q1 2026 report presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. If you are listening to the presentation via webcast, you can ask written questions using the form below. Now, I will hand the conference over to CEO Niklas Stenberg and CFO Malin Enarson. Please go ahead. Thank you, operator. Most welcome to everyone to Addtech's first quarter report presentation. Today's setup is that we will use approximately 15 minutes to summarize and give our comments on the results. Then open up for questions. As usual, just a brief summary for any newcomers. A quick run-through of the key fundamentals of Addtech. We are a group of 150+ independent and strictly decentralized companies operating in 20 countries with a clear business-to-business offering. We operate in six business areas, all with clear strategies and a value proposition centered around niche products and solutions, primarily to manufacturing and infrastructure sectors. We have our successful dual growth engine approach, focused to develop and grow the business organically together with our local entrepreneurs. Then complement and strengthen our strategic niches with acquiring leading niche companies with a strong offering. Fund our acquisitions primarily by own cash flow. That's how the model works. Size-wise, we have now a turnover rolling 12 of around SEK 23 billion. Run the operations with an EBITA margin at around 16%. Employ slightly less than 5,000 employees throughout the organization. A small and efficient central team. There you have Addtech in a brief summary. With that said, let's head on to the quarterly highlights. All in all, we can summarize a good start of the new fiscal year. Despite the geopolitical uncertainties, the market situation improved for the group with high customer activity. A very solid order intake, broad-based, I would say. Total net sales increased by 6% during the quarter, organically in line with last year. No effects from FX this quarter. Our EBITA increased with 11%. We improved our margin compared to last year to a high level of 16.6%. We strengthened our cash flow. Closed two acquisitions during the quarter. A bit more on net sales. The overall business situation was good, as I said. We grew top line 6%, which means it was from acquisition, but solid contributions primarily from business areas Automation, Electrification, and Safety. Segment-wise, if we summarize all business areas, the main drivers in the quarters were electronics with products and solutions for electrifying equipment. Special vehicles had a good quarter, primarily towards mining and defense markets. Solid contributions also from medical and also transport sector, where railway and marine were the main contributors. The niche segment, traffic safety, also this quarter contributed in a good way with a continued positive development. All in all, high customer activity. As I said, the broad-based order intake, positive book-to-bill. During the quarter, in part of the business, we're seeing a tendency for customer to place some framework orders to hedge against uncertainty and feared price increases and delays going forward due to the uncertainties that we have around us. I will come back with more details about market development in each business area very shortly. EBITDA increased with 11%. Here, solid contributions from Automation, Electrification, and Safety. We continue to improve our gross margins across the board, so all business areas increased gross margins. It's very satisfying. We report an improved EBITDA margin, as I said, 16.6%. The positive development is primarily due to continued improvements in the product mix and solid contributions from acquisitions, also positive effects from active pricing initiatives and, of course, also earlier communicated restructuring measures in a handful of companies, primarily in Automation and Safety, where we now see good effects. We strengthened our cash flow, and profit for working capital remained at high level. A few words on each business area. From the top, starting with Automation, as you can see in the slide, the business situation clearly improved in the first quarter. A broad-based increase in sales and a good leverage on both earnings and margins. The market situation strengthened. We have now had five quarters in a row with a sequential improvement in order intake, and that is a strong indication for us. The underlying demand for product solutions for defense industry remained very strong. Order intake in mechanical Industry, Medical, and Process had a positive development. Within medical is primarily OEMs supplying diagnostic and analytical equipment, and within segment Process, it's the food processing OEMs that are the main drivers. A solid recovery in Automation that we've been waiting for, and clear positive effects on earnings and margins. Moving on to Electrification. A very strong quarter where market situation was strong. A very good order intake here. Net sales increased with 27%, driven by a solid business momentum in basically all main segments, mechanical Industry and defense, the only exceptions. The latter, defense industry, must due to very tough comps. Here we have products that are not linear. It can come one or another quarter. It's also great to see that our battery group continues to develop positively with good contributions to many of our customer segments. Strong contributions from acquisitions, primarily RAMME in Germany, which are focusing on the Marine segment. In summary, a very strong quarter for Electrification, broad-based growth, solid contributions from the acquired company, as I said, an EBITDA growth of 43% with a high margin of 16.2%. In the margin, I would say that it's partly boosted by very strong performance from acquisitions with a slight positive seasonal effect in this quarter. Energy experienced a very positive market development in the first quarter. The electrical transmission business recovered in a very good way with high order intake after period with fewer project rollouts, and a lower order intake earlier quarters. High demand also in distribution and transport while power generation was stable. Sales were down in the quarter as expected due to very tough comps, with an improved product mix, our margins increased to 19.5%. Forward-looking, we have a very strong backlog and good business momentum, indicating a strong year, but tilted towards the second half of the financial year, as we indicated already in the Q4 report. Again, the products are now coming in just as we had expected. The overall market situation within Industry was good in the quarter, but with variations. Solid demand in mechanical industry, electronics, subsea, and waste management, but companies exposed to forestry and sawmill industry order intake remained weak. We have been repeating this now for a number of quarters. Customer activity is there, and a couple of orders were won during the quarter, but we don't see any general trend shift here. Also, special vehicles met a somewhat weaker market situation where demand being negatively affected by geopolitical uncertainty and higher oil price that we had during the quarter. Total net sales decreased with 3%. Again, this is primarily due to the sawmill volumes. These effects will, of course, remain until this market situation improves. Moving on to Business Area Process, where the overarching market situation was, I would say, stable in the quarter. Demand was good in Marine segment, solid order intake related to regulatory demands and shift to more green fuels. Also Energy and Special Vehicles had a positive development. Stable in mechanical industry, weak in medical technology towards tough comps, and also forestry and process industry was on the weaker side. Here we again see that activities are good. There are a lot of discussions on products, but customers are still holding off on investment decisions. Products are also continuing to being a bit postponed. All in all, a rather challenging start for Process with 2% increase in sales, but this is entirely driven by contributions from acquisitions. Earnings and margins were down to the lower business volumes, but adjusted for revaluations of consideration, we actually saw a slight improvement on the margins also for Process in this quarter. Last not least, Safety, which had a very positive development in the quarter, a good business development and solid order intake. The market remained strong within traffic safety and the Energy, electronics, and engineering manufacturing industry experienced a positive trend in the quarter. Regarding data centers, we saw a bit flattening out on high levels within Safety during the quarter. Here we see a little shift towards more local product procurement in data centers. This will seemingly give potential for several companies in the group moving forward. No clear signs, however, I would say in the construction sector. It's an important sector for Safety. The companies exposed to building installation continued to meet overall weak demand. Overall sales increased by 10%, approximately half coming from acquisitions. Positive effect on earnings and margins, also fueled by both product mix that was improved and the previously implemented cost measures in a couple of companies that we've been talking about earlier last year. Well, to sum up this picture, I would say a very solid quarter, positive market situation, high customer activity on group level. Variations still between different segments, customers, and geographies. It is clear that the geopolitical uncertainty still adds to the hesitant approach in investing among customers in a number of segments. With that said, I give the word to you, Malin, for a few more details. Thank you, Niklas. You have mentioned a lot of important matters already. I will dig down in some of them. As you heard, our EBITA grew and the profit margin improved compared to last year. The EBITA margin increased by one percentage points, adjusted for revaluations of earnouts. We had yet another quarter with a record high margin. We had good contributions from acquisitions, but the development was also attributable to an improved product mix, good pricing power, and the fact that restructuring measures taken in businesses with persistently lower market conditions are starting to have a clear impact now. We can see that the trend line of total cost in relation to sales still has a good development. Regarding other operating incomes and expenses, revaluations of earnouts were more or less in line with last year, while currency effect from revaluation of balance sheet items had substantially less negative effect on other income and expenses than last year. Our cash flow from operating activities strengthened compared to the same quarter last year by stronger margins and efficient working capital. Cash conversion was stable at a satisfactory level. Inventory levels increased somewhat during the quarter due to acquisitions and the usual summer buffering, but also due to price increases and supply chain disruptions. All in all, inventory levels are still at healthy levels in relation to sales and order backlog, and profitable working capital remained at 81% sequentially. Our financial position remained very strong during the quarter, and our gearing and leverage decreased compared to last year, even though our net debt has increased. We have a very satisfactory headroom in our financing structure, which strengthened further during the quarter through the rising of new debt. While we do not have any specific debt targets, we believe our strong balance sheet provides significant capacity to fund future acquisitions and organic growth investments. With that said, I hand over back to you, Niklas, for more information about acquisitions, I believe. Yes. Thank you, Malin. As you can see in the picture, we have had a strong first six months of this calendar year. A lot of very good companies coming into the group. We completed two more acquisitions during the quarter. Two Dutch companies, one, Staka Holding, supplying customized outdoor enclosures, and Nijhuis Engineering, selling patented system solutions for road and rail construction machinery. We are proud to welcome them both to the group. Together, they add about SEK 250 million in turnover with accretive margins. Given our increased footprint internationally, as you can see in the picture, it's a lot of acquisitions outside of the Nordics. We can really see that we have a growing awareness of Addtech in a lot of new markets. We continue to fill our pipeline with high-performing companies that are well spread across both niches and geographies and business areas. This combined with the strong balance sheet, as Malin just went through, this gives us a lot of firepower, I really expect to keep a high acquisition pace going forward. The acquisition market looks very promising, I would say. To wrap up this, a very good start to the fiscal year. High customer activities quite across the board. We can see that despite, again, the geopolitical uncertainty and the very tough comps in Energy and Industry, we grew top line, we especially grew earnings with 11% and even better on earnings per share. Strengthened the cash flow and balance sheet remains very strong. Given our agility and strong positions in attractive niches. We have a positive view of the continuance of this financial year, tilted towards the second half, as we have been indicating before. With that said, over to Q&A. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Ope Otaniyi from Goldman Sachs. Please go ahead. Hi. Good morning, Christopher. Sorry, good morning, Niklas. Good morning, Christopher, and good morning, Malin. Two questions. Morning. Morning. Two questions from my end. Maybe just one on margin and then one on Industry. I suppose margins have been quite strong for a few years on quarters now, but particularly strong in the last few quarters. Could you just give us some thoughts on how you see this level in coming quarters and any thoughts on what's driving margins higher? It's like you said. We have had a really good development on margins. Of course, they can vary a bit quarter-over-quarter. If we look at the group as such, we see that the kind of rolling 12 margin is relevant with a continuous ambition to gradually increase the margin. It can vary a bit, of course, between the different business areas. Automation is coming from a lower level, and as we've been indicating in earlier quarters, we have foreseen that Automation should come back on the level they are now. While on the other hand, we can see that, for instance, Industry having the kind of tough comps on sawmill industry will, most likely as it looks right now, rather maybe decrease a little bit. All in all, we think the rolling 12 margin is relevant going forward. Again, with, as always, an ambition to increase the margins. As I also indicated, in Electrification, a very strong margin this quarter, which is partly boosted, not very significantly, but a little bit due to a very strong performance from acquisitions this quarter. Especially RAMME in Germany has a little seasonality effect with the strong Q1 and a bit weaker Q2, due to that they closed down production and so forth for a couple of weeks. All in all, we think we are satisfied with the margin levels. Great. Thanks very much. Just one more on Industry. I think you've sort of telegraphed that sort of headwind in Forestry has existed for a few quarters now. Is there anything new in terms of Special Vehicles or the end markets there? Sorry, on Special Vehicles? Yes, within Industry, just with the other end markets may be driving sort of weaker organic growth near term. Is it just Forestry or sort of Special Vehicles and other stuff as well within Industry? No, in general, I would say we see a positive development on most niche segments in Industry. The sawmill headwind is, of course, the big issue for Industry. This quarter, we saw a little bit weaker order intake from some segments in Special Vehicles, and that is due to disruptions in supply chain and also higher oil price that has given a little bit of a hesitation. We still see Special Vehicles having a good market situation. I would say also electronic production, mechanical industry, we have a good development there. I would say it really runs down to the sawmill market. Great. Thanks very much. Thanks for taking my questions. Thank you. The next question comes from Max Bacco from SEB. Please go ahead. Thank you, operator. Hi, Niklas and Malin. Hi. The first question also relating to the Industry segment. Basically a follow-up. As you mentioned yourself, the margin down 1.3 percentage points here in the quarter, or 1.4, adjusting for earnouts revaluation. Is that a fair magnitude to assume also going ahead all else equal, or is it anything else to it? Yes. It's always very difficult to guide here because it depends on many different variables. We said going into this year that as long as the sawmill market is hampered, this will have an effect on the margins. I think there is probably, as of now, rather maybe some additional slight negative potential on the margin the coming quarters. I would not expect any dramatic change, from this level, it's maybe a little bit more there. Okay, understood. On the same topic, which I also addressed during the presentation, Automation and Safety segments both saw very nice profitability improvements here in the quarter, which was something we discussed last quarter as well, and still quite stable on a sequential basis, the margin then compared with Q4. Would you say that these levels are reasonable to expect going ahead, or is there any seasonality in these two segments that should be considered? No, I would not say any specific seasonality. As you can see from early years, we see some effect, of course, from the summer period. Apart from that, on the margin side, I would say that Automation is on the right track, meaning that Automation should have a slight better margin than rolling 12. While in Safety, I would say rolling 12 is probably a relevant number also going ahead. Okay. Very clear. The final one, just to clarify it. You highlight here in the quarter a well-filled order book, positive book-to-bill, and also that the market situation has strengthened during the quarter. Of course, we have the specific dynamics in each respective segment. To me, it sounds like that you at least expect organic sales growth to gradually improve in the coming quarters versus the basically 0% that we have seen during the last two quarters. Is that a correct interpretation? Yeah, only looking at our order intake in the quarter and the order book, again, considering tilted towards the second half. Of course, all uncertainties that might have different effects, our expectations is that organic growth should gradually improve, again, tilted towards the second half. Very clear. That was all from me. Thank you very much. Thank you. The next question comes from Karl Bokvist from ABG Sundal Collier. Please go ahead. Thank you. Good morning. First on Automation here. We've talked about it, but just when thinking about the margins now, and you've been talking about cost savings initiatives, et cetera. From this step, if we think about the 14% level, is there more that can be realized from your own initiatives? Or is it now from this level more about getting a bit of organic growth back and that you get leverage on volumes and so on, which in turn could drive profitability? Good morning. I would say that as of now, it's more relating to top-line growth and that will generate incremental margins, potential incremental margin improvements. The cost initiatives, again, as of now, I would say are already in the numbers. All right. Just on Industry here, even when we take the earnout revaluations into account, it's at 20%. Despite the fact that sawmill volumes are low, I acknowledge your commentary earlier about that it could have a slight negative impact, just the other parts here, do you think that there is more to come in other areas of Industry that could support or raise margins? Is it more about, to your point earlier about rolling 12 with a slight negative impact from sawmills, that's how we should think about it? It's always in a group like Addtech and also in the Industry, there are a number of companies that should increase their margins. If you look at Industry as a whole, I would say that my comment before is not that I really see at this point that we have any other segments or markets that would balance up that effect from sawmill. Rather a slight decrease until sawmill market comes back. Final question is on just looking into your second quarter now ahead, primarily on Energy and Industry. Correct me if I'm wrong here, when just looking at the organic growth that these businesses saw last year, it seems like both had quite good quarters. Would it be just fair to assume or take that into account when assessing the year-over-year development for those two divisions now for your current second quarter? Yeah, I think it's quite clear if you look on the second quarter last year and my comments now, where Industry had a very strong effect from some sawmill projects in the second quarter last year, and primarily from that side. Also Energy having a strong quarter and as I said, really strong product inflow now in Energy. Those products are more, I would say, tilted towards the third and fourth quarters. I think your assumption is probably correct. Great. Then the follow-up would be, because then from Q3 it looks like those kind of comparables, for lack of better words, are better in that sense, right? That it's primarily Q2 where you still have this challenge year-over-year, from Q2 things look more normalized. I mean, from Q3. Yes. All right. Very good. Thank you. Thank you. The next question comes from Gustav Berneblad from Nordea. Please go ahead. Yes, good morning. It's Gustav here from Nordea. Hi. I thought maybe just to build here. Hi, good morning. Just to build on Karl's here question on Energy. It sounds like you are incrementally more positive here in terms of orders, where you phrased it very strong. Can you just elaborate a bit more on this and maybe just recap to the previous discussion we had here in Q4, where you sort of highlighted permitting constraints and a bit of a bottleneck and so forth? Good morning. What we have always said here is that we will not see a linear development. Even if the underlying demand is very strong on the markets where we are, it will be variations quarter- by- quarter. The fact that we had a little slower product inflow due to all of these restraints that we usually talk about in the last maybe one, two quarters, we now see a very strong comeback, so to say. I think we have to look at this market in the more longer perspective and just realize that it could be variations on quarterly basis. This permit situation, I would say is still there. It can still be delays due to appeals and all of these things. Again, the kind of outlook at this point looks very promising. What was that? That's very clear. Yes. That was good. Just a follow-up on that, because it feels like you commented on, as you say, a decent market still. Despite, you still comment on volumes picking up first in Q3 and Q4. Should we assume that it's longer lead times on these projects as well, and that we should expect it to be more tilted towards 2027, the orders you take here in Q1 or? I think my point is that, as it looks as of now, we elaborate on the order book, we should see effects from this in the third and fourth quarter. Is it possible to comment anything specific on a specific number on the book-to-bill here in the quarter? As you know, we don't report figures like concrete on order intake. If I say it's clearly above one. That's very clear. Thank you. That was all for me. Maybe I could add is a sequential improvement, a slight sequential improvement on book-to-bill. That's very clear. Thank you, Niklas. Thank you. That was all for me. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. The next question comes from Johan Lönnqvist Sundén from DNB Carnegie. Please go ahead. Hi, Niklas and Malin. Hi. Hi. Thank you for taking my questions. I actually just have one follow-up question to all good questions that already been asked. It's on the Safety segment and the comment on the data center exposure, where you mentioned that you're seeing a trend for more kind of local procurements, and it could create big opportunities for more Addtech companies. Can you please elaborate a little bit what that really means? How many companies can be involved, and how can that kind of Safety segment or that exposure change for you in the coming year or so? Yeah. Looking back, we have had primarily a couple of companies in the U.K. with a very strong situation on data centers. What we have seen, as said, it has flattened out a little bit on that side. That is because we can see a shift towards procurement being more on a general European basis for a few players towards more local procurement. What we can see now, and it's very difficult, even if I wanted to, I couldn't say an exact potential here. It's quite clear that, I would say, it's a number of companies that are indicating that they are in discussions on projects, and it's basically in all Nordic markets. That's the shift I talk about. If it flattens out a bit on the more bigger procurement project, it's now more tilted over to local procurement. We see a positive potential here, but I couldn't elaborate on any figures here. If I may have a follow-up there. When you say more companies, are you still only referring to companies within the Safety segment, or are there- No, it's actually. many companies in other segments as well? Yeah. It's actually also in, I would say, both Energy and Electrification. It's actually a bit broad-based here. Interesting. Another question as well, on a different topic, is the project postponement that we talked about a bit. You say that they still persist. Any kind of change throughout the second quarter of indication change behavior on that sense? No, not really. It's still the same thing. I've been talking about this confidence in investments. I think the ongoing disturbance that we see over and over, not in our Addtech company, but more the geopolitical situation. This is, I would say, particularly affecting more very high energy-consuming production, like chemical industry and so forth. Here we can see that there is a lot of projects. We have a good order book and a lot of discussions, but we still see these hesitations. I would say no real change here. What about lead times? Say if the client would decide to go ahead tomorrow, would it be possible for you to deliver, or would it be normal for you to deliver for that client during fall? Or is it something for first of 2027? No, I would say that a number of these projects have been planned for quite a long time. We could most likely start to deliver quite instantly, during the fall. It, of course, depends on the different project, but to a quite large extent, we could start supplying during fall. Perfect. Yeah. Thanks for the color on those two topics. I'm happy to get back in line. Thanks a lot. Thank you. There are no more phone questions at this time, I hand the conference back to the speakers for any written questions or closing comments. Thank you all for good questions. We can conclude that we don't have any written questions either. With that said, we wish you all a great week and eventually a good summer. Thank you very much. Thank you all.