Release Date: October 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Beijer Alma AB (LTS:0YG7, Financial) reported organic growth in the third quarter, indicating some stability in a weakened economy.
- The Nordics, Asia, and UK regions showed strong performance, contributing positively to the company's growth.
- Beijer Tech's Fluid Technology segment experienced significant growth, both organically and through acquisitions.
- The company successfully completed acquisitions of Clifford Springs and Clemco, supporting its growth strategy.
- Lesjofors launched door springs in the US, which positively impacted growth despite some initial one-off costs.
Negative Points
- Order bookings declined by 1%, and net revenues grew only slightly, reflecting modest growth numbers.
- The Chassis Springs business area experienced a slowdown, with net revenues decreasing by 8% due to tough comparables and reduced stock levels.
- Germany and Central Europe were identified as weaker markets, impacting overall performance.
- Adjusted operating profit margin decreased by 0.8 percentage points compared to the previous year.
- The company faces economic uncertainty, including high interest rates, which poses challenges for balancing growth investments and savings.
Q & A Highlights
Q: Can you provide insights into the profit development between the Industrial segment and Chassis Springs within Lesjofors?
A: The Industrial segment performed better year over year compared to Chassis Springs. The slowdown in Chassis Springs, comparable effects from last year's energy support, and one-off costs from the US door springs launch impacted profits. Additionally, the weaker European, particularly German, economy affected results. - Henrik Perbeck, CEO
Q: Regarding the weak demand in Germany and Central Europe, did demand deteriorate during the quarter, and what are your expectations for Q4?
A: After the summer, performance remained weak, contrary to expectations of improvement. We are not speculating on when an upturn will occur, but demand has been stable without a significant drop at the end of the quarter. - Henrik Perbeck, CEO
Q: Niche Technologies saw slower growth. Are comparables getting easier, and what is the outlook for year-over-year development?
A: Despite strong performance last year, we maintained growth, which is positive. Demand drivers for these niche companies differ from the general economy. We have a positive long-term view on their growth potential, though performance can fluctuate quarterly. - Henrik Perbeck, CEO
Q: How did the acquisitions impact the financial performance this quarter?
A: Acquisitions contributed positively to growth, with Beijer Tech's revenue increasing both organically and through acquisitions. The acquisition of AVS in March notably boosted Fluid Technology's growth. - Johan Dufvenmark, CFO
Q: What is the current financial position of Beijer Alma, and how does it support future growth strategies?
A: With a net debt-to-EBITDA ratio of 1.8, we maintain a strong financial position to support our growth strategy, including acquisitions. This financial stability allows us to pursue opportunities in the M&A market. - Johan Dufvenmark, CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
