Bufab Stock price
Compare with Peer Group
📊 Peer Group
📈 What is it?
The peer group consists of the companies with the most similar business model. They serve as a benchmark for putting a stock into context.
🧮 How is it selected?
Based on similarity of business model, meaning companies from the same industry with comparable products and a similar customer base. That's the only way to compare apples to apples.
🏛️ Why does it matter?
Whether a stock is cheap or expensive is best judged by comparison. A P/E of 18 or an EV/FCF of 20 can look cheap or expensive depending on the yardstick. The peer group gives you the most accurate one: companies with a similar business model that operate under the same conditions.
🎯 What does it mean for investors?
When a metric sits below the peer average, the stock is valued more cheaply relative to its competitors, and above the average more expensively. A discount to the peer group can be an opportunity, but it can also have a reason (for example lower growth). The comparison is a starting point, not a verdict.
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Key metrics
📘 Market Capitalization
📈 What is it?
Market capitalization shows how much a company is currently worth on the stock market.
🧮 How is it calculated?
🏛️ Why is it important?
It helps classify companies by size (Large, Mid, Small Cap) and indicates their market presence and relative stability.
🧮 Calculation
🎯 What does this mean for investors?
- Large-cap companies tend to be more stable, often pay dividends, but may grow more slowly.
- Smaller firms may offer higher growth potential but come with more volatility.
- Market capitalization is a useful indicator of company size — but not a measure of whether a stock is undervalued or overvalued.
📘 Enterprise Value (EV)
📈 What is it?
Enterprise Value represents the total cost to acquire a company — including its debt and excluding its cash reserves.
🧮 How is it calculated?
(= Market Cap + Net Debt)
🏛️ Why is it important?
EV gives a more complete picture of a company's value than market cap alone and is used in key valuation ratios like EV/FCF or EV/Sales.
🧮 Calculation
🎯 What does this mean for investors?
- Enterprise Value shows the true cost of buying a company, including all financial obligations.
- It is more accurate than just looking at market cap, especially when comparing companies with different levels of debt or cash.
- Professional investors prefer EV-based multiples because they better reflect the company’s full financial footprint.
📘 Net Debt
📈 What is it?
Net Debt shows how much debt remains after subtracting a company’s available cash reserves.
🧮 How is it calculated?
🏛️ Why is it important?
It indicates how dependent a company is on borrowed money and how easily it can service its debt in the short term.
🧮 Calculation
🎯 What does this mean for investors?
- Low or negative net debt signals financial strength and flexibility.
- Companies with strong cash positions are better positioned in crises.
- High net debt increases financial risk — especially in environments with rising interest rates or economic downturns.
📘 Cash
📈 What is it?
Cash represents all liquid assets a company can access immediately — including cash, bank deposits, and short-term investments.
🧮 How is it calculated?
🏛️ Why is it important?
It reflects a company’s financial flexibility and resilience — enabling investments, buybacks, or buffer in downturns.
🧮 Calculation
🎯 What does this mean for investors?
- A strong cash position means greater room for maneuver and crisis resistance.
- Cash-rich companies can invest, pay down debt, or repurchase shares.
- But excess idle cash might indicate a lack of growth opportunities.
📘 Shares Outstanding
📈 What is it?
Shares outstanding represent the total number of a company’s shares currently held by investors — excluding treasury stock.
🧮 How is it calculated?
🏛️ Why is it important?
It’s the basis for key metrics like Earnings Per Share (EPS), Market Capitalization, or the Price/Earnings ratio (P/E).
🧮 Calculation
🎯 What does this mean for investors?
- Fewer shares in circulation typically increase earnings per share — making each share more valuable.
- Share buybacks reduce the number of shares and boost per-share metrics.
- Issuing new shares does the opposite — diluting shareholder value and lowering per-share figures.
📘 Price-to-Earnings Ratio (P/E)
📈 What is it?
The P/E ratio shows how many times a company's earnings per share are reflected in its current share price — in other words, how "expensive" the stock appears relative to its profits.
🧮 How is it calculated?
🏛️ Why is it important?
The P/E ratio is one of the most widely used valuation metrics. It helps investors assess whether a stock appears cheap or expensive compared to its earnings power.
🧮 Calculation
📊 P/E (TTM) = Based on earnings from the last 12 months (Trailing Twelve Months):🎯 What does this mean for investors?
- A low P/E may indicate undervaluation — or signal underlying issues.
- A high P/E may reflect strong growth expectations — or an overvalued stock.
📘 Price-to-Sales Ratio (P/S)
📈 What is it?
The P/S ratio shows how much investors are paying for $1 of the company’s revenue – regardless of profitability.
🧮 How is it calculated?
🏛️ Why is it important?
P/S is especially useful for evaluating growth companies or businesses not yet profitable. It reflects how the market values the company’s sales.
🧮 Calculation
Market Cap = kr25.89b | Revenue (TTM) = kr8.66b
Market Cap = kr25.89b | Estimated Revenue = kr9.09b
🎯 What does this mean for investors?
- A low P/S may indicate undervaluation — or low profitability.
- A high P/S can reflect strong growth expectations — or excessive optimism.
- Especially helpful when evaluating companies where profits are low, volatile, or negative.
📘 Enterprise Value to Sales (EV/Sales)
📈 What is it?
EV/Sales shows how much investors are paying for $1 of revenue — considering not just equity, but also debt and cash. It’s the capital structure–adjusted version of the P/S ratio.
🧮 How is it calculated?
🏛️ Why is it important?
It’s ideal for comparing companies with different levels of debt. It reflects a company's true cost relative to its revenue.
🧮 Calculation
Enterprise Value = kr29.33b | Revenue (TTM) = kr8.66b
Enterprise Value = kr29.33b | Forward Revenue = kr9.09b
🎯 What does this mean for investors?
- EV/Sales allows for capital structure–neutral company comparisons.
- A lower ratio may indicate undervaluation; a higher one may signal strong growth expectations or overvaluation.
- Especially helpful when evaluating high-growth companies with low or negative earnings.
📘 Enterprise Value to Free Cash Flow (EV/FCF) | ex SBC
📈 What is it?
EV/FCF compares a company’s enterprise value with its free cash flow. The metric therefore shows the multiple of current free cash flow at which a company is valued. EV/FCF ex SBC additionally accounts for stock-based compensation (SBC). While SBC does not represent a direct cash outflow, issuing shares as compensation can dilute existing shareholders. Therefore, SBC is deducted from free cash flow in this adjusted version.
🧮 How is it calculated?
EV/FCF ex SBC = Enterprise Value ÷ (Free Cash Flow (TTM) − SBC)
🏛️ Why is it important?
EV/FCF provides a valuation based on free cash flow and therefore complements earnings-based valuation metrics such as the P/E ratio. The ex SBC version additionally accounts for the economic impact of stock-based compensation and provides a more conservative view from a shareholder perspective.
🧮 Calculation
🎯 What does this mean for investors?
- A low EV/FCF means that enterprise value is low relative to current free cash flow. The reasons should always be considered in the context of the company and its industry.
- A high EV/FCF means that enterprise value is high relative to current free cash flow. This can, for example, reflect high growth expectations or temporarily weak cash generation.
- When SBC is positive and adjusted free cash flow remains positive, EV/FCF ex SBC is generally higher than the standard EV/FCF.
- The metric is particularly useful for companies with relatively stable and predictable cash flows.
- If free cash flow is negative or very low, EV/FCF has limited usefulness and should not be interpreted like a standard valuation multiple.
📘 Price-to-Book Ratio (P/B)
📈 What is it?
The P/B ratio compares a company’s market value to its book value — showing how much investors are paying for each dollar of net assets.
🧮 How is it calculated?
🏛️ Why is it important?
P/B is commonly used for asset-heavy industries like banks or industrials. It helps assess whether a stock is trading above or below its net asset value.
🧮 Calculation
🎯 What does this mean for investors?
- A P/B below 1 may signal undervaluation — or weak profitability.
- A P/B above 1 implies the market expects future value creation (e.g., brand, IP, growth).
- Best used for companies with tangible assets and strong balance sheets.
📘 Dividend per Share (DPS)
📈 What is it?
Dividend per Share shows how much cash a company pays out to shareholders for each share they own – usually on an annual or quarterly basis.
🧮 How is it calculated?
🏛️ Why is it important?
DPS is the absolute value of the payout per share – crucial for income-focused investors and dividend strategies.
🧮 Calculation
🎯 What does this mean for investors?
- A stable or growing DPS often signals a strong, shareholder-friendly business.
- DPS alone doesn’t tell you how attractive the payout is – the stock price also matters (→ see Dividend Yield).
- Long-term dividend growth is often a hallmark of high-quality companies – like the dividend aristocrats.
📘 Dividend Yield
📈 What is it?
Dividend yield shows how large a company’s dividend is in relation to its current share price.
🧮 How is it calculated?
🏛️ Why is it important?
It allows investors to compare dividend payouts across stocks, regardless of price or payout size.
🧮 Calculation
🎯 What does this mean for investors?
- A stable yield can reflect reliable distributions.
- Comparing 1Y and 5Y yield shows whether dividend growth keeps pace with stock price appreciation.
- A low yield isn’t always negative – it can signal strong past performance or growth focus.
📘 Dividend Growth
📈 What is it?
Dividend growth shows how much a company has increased its dividend per share over time.
🧮 How is it calculated?
5Y: Compound Annual Growth Rate (CAGR)
🏛️ Why is it important?
Consistently rising dividends are often a sign of financial strength and shareholder orientation – especially relevant for long-term investors.
🧮 Calculation
🎯 What does this mean for investors?
- Stable dividend growth is a sign of sustainable earning power.
- High dividend growth can significantly boost your total return:
- If a company pays $1 in dividends and increases it by 15% annually over 5 years, you’ll receive $2 per share in year 5 – twice as much as at the start!
📘 Payout Ratio
📈 What is it?
The payout ratio shows what percentage of a company’s earnings (per share) is distributed to shareholders as dividends.
🧮 How is it calculated?
🏛️ Why is it important?
It helps assess whether the dividend is sustainable – especially in relation to the company’s profitability.
🧮 Calculation
🎯 What does this mean for investors?
- A low payout ratio means the company retains more earnings for reinvestment – typical for growth companies.
- A moderate payout (e.g. 25–50%) indicates a healthy balance between returns and reinvestment.
- High payout ratios may seem attractive but can carry risk if earnings decline.
📘 Consecutive Dividend Increases
📈 What is it?
This metric shows how many consecutive years a company has raised its dividend per share – without any cuts or pauses.
🧮 How is it calculated?
(Special dividends are not considered.)
🏛️ Why is it important?
A long track record of increases reflects financial strength, consistency, and shareholder commitment.
🎯 What does this mean for investors?
- A long dividend increase streak builds confidence – especially in volatile markets.
- Such companies are seen as reliable and income-friendly investments.
- The longer the streak, the stronger the company’s dividend discipline.
📘 Revenue
📈 What is it?
Revenue shows how much a company earns in total from selling its products and services – the gross income before any costs are deducted.
🧮 How is it calculated?
🏛️ Why is it important?
Revenue is one of the key figures to assess a company’s size, market position, and growth potential.
🧮 Calculation
🎯 What does this mean for investors?
- Growing revenue indicates rising demand and can be an early signal of future earnings growth.
- Comparing actual and expected revenue reveals trends in the market environment and analyst sentiment.
- Note: Strong revenue alone isn’t enough – margins and profitability matter just as much.
📘 EBITDA
📈 What is it?
EBITDA stands for “Earnings Before Interest, Taxes, Depreciation, and Amortization.” It reflects a company’s operating profit before the effects of financing, taxes, and accounting depreciation.
🧮 How is it calculated?
🏛️ Why is it important?
EBITDA is widely used to evaluate a company’s operating performance – especially across capital-intensive sectors or international comparisons.
🧮 Calculation
🎯 What does this mean for investors?
- A high or growing EBITDA indicates strong operational profitability – independent of taxes, interest, or accounting methods.
- It’s especially useful for comparing companies across sectors or geographies.
- Important: EBITDA is not a net income figure – it excludes key costs like depreciation and interest.
📘 EBIT
📈 What is it?
EBIT stands for “Earnings Before Interest and Taxes.” It reflects a company’s operating profit after depreciation, but before interest and tax expenses.
🧮 How is it calculated?
🏛️ Why is it important?
EBIT is a core profitability metric that shows how well the company performs in its main business operations – independent of capital structure and tax environment.
🧮 Calculation
🎯 What does this mean for investors?
- A high EBIT indicates strong profitability from the company’s core business – before financial and tax effects.
- It allows better comparison between companies with different debt levels or tax structures.
- Compared to EBITDA, EBIT already accounts for depreciation and reflects capital intensity more clearly.
📘 Net Income
📈 What is it?
Net income is the company’s total profit – the amount left after all expenses, taxes, interest, and depreciation have been deducted.
🧮 How is it calculated?
🏛️ Why is it important?
Net income is the most comprehensive measure of a company’s profitability – showing how much actual profit remains after all business and financing costs.
🧮 Calculation
🎯 What does this mean for investors?
- Growing net income indicates that the company is managing all of its costs efficiently.
- It directly influences valuation metrics like P/E ratio and the company’s dividend capacity.
- Over time, net income trends reveal how resilient and profitable the business model really is.
📘 Free Cash Flow (FCF) | ex SBC
📈 What is it?
Free cash flow shows how much cash remains after a company has covered its operating and capital expenditures. FCF ex SBC additionally deducts stock-based compensation (SBC) to adjust the cash flow for the effect of non-cash SBC.
🧮 How is it calculated?
Free Cash Flow ex SBC = Operating Cash Flow − SBC − Capital Expenditures (CAPEX)
🏛️ Why is it important?
FCF reflects a company’s actual financial strength – independent of reported accounting earnings. It shows how much flexibility a company has for dividends, share buybacks, or debt reduction. FCF ex SBC also deducts stock-based compensation and shows how much cash generation remains after SBC.
🧮 Calculation
🎯 What does this mean for investors?
- High free cash flow indicates that a company has strong financial strength – independent of reported earnings.
- It is often a solid basis for sustainable dividends and share buybacks.
- Declining FCF can be a warning sign, even if reported earnings remain stable.
📘 Revenue Growth
📈 What is it?
Revenue growth shows how much a company’s sales have changed compared to the previous year – both on a trailing basis (TTM) and based on forward projections.
🧮 How is it calculated?
Forward = (Expected revenue ÷ Revenue in prior year − 1) × 100
Forward growth is based on analyst estimates for the current fiscal year.
🏛️ Why is it important?
Rising revenue signals growing demand, business expansion, and market share gains – especially important for growth-oriented companies.
🧮 Calculation
🎯 What does this mean for investors?
- Growth is the engine of long-term value creation – especially in tech and growth sectors.
- What matters is not just current growth, but its sustainability.
- Forward projections reflect whether analysts expect continued momentum – or a slowdown.
📘 EBITDA Growth
📈 What is it?
EBITDA growth shows how much a company’s operating profit (before interest, taxes, depreciation, and amortization) has increased or decreased compared to the previous year.
🧮 How is it calculated?
Forward = (Expected EBITDA ÷ EBITDA from prior year − 1) × 100
The forward estimate is based on analyst projections for the current fiscal year.
🏛️ Why is it important?
Growing EBITDA indicates improving operational profitability – regardless of financing or accounting effects.
🧮 Calculation
🎯 What does this mean for investors?
- Strong EBITDA growth signals operational efficiency and scalability – especially during growth phases.
- EBITDA growth can be an early indicator of margin and earnings expansion – but should be assessed alongside revenue and EBIT.
📘 EBIT Growth
📈 What is it?
EBIT growth shows how much a company’s operating profit (after depreciation, but before interest and taxes) has increased compared to the previous year.
🧮 How is it calculated?
Forward = (Expected EBIT ÷ EBIT from prior year − 1) × 100
The forward estimate is based on analyst projections for the current fiscal year.
🏛️ Why is it important?
EBIT growth is a direct indicator of a company’s business performance – taking into account capital intensity through depreciation.
🧮 Calculation
🎯 What does this mean for investors?
- Rising EBIT signals improving operating profitability – even after accounting for depreciation.
- It’s especially important for evaluating companies with significant capital expenditures.
- Combined with revenue and EBITDA growth, EBIT growth provides a well-rounded view of operational progress.
📘 Net Income Growth
📈 What is it?
Net income growth shows how much a company’s bottom-line profit has increased or decreased compared to the previous year – both on a trailing basis (TTM) and based on analyst projections.
🧮 How is it calculated?
Forward = (Expected net income ÷ Net income from prior year − 1) × 100
The forward estimate reflects analysts’ expectations for the current fiscal year.
🏛️ Why is it important?
Net income is the ultimate measure of profitability. Growing net income signals stronger efficiency, cost control, and sustainable earnings power.
🧮 Calculation
🎯 What does this mean for investors?
- Stronger net income boosts valuation, dividend potential, and investor confidence.
- If profits stall while revenue grows, it may signal margin pressure.
📘 Free Cash Flow Growth
📈 What is it?
Free cash flow (FCF) growth shows how a company’s available cash – after covering operating expenses and capital expenditures – has changed compared to the previous year.
🧮 How is it calculated?
🏛️ Why is it important?
Free cash flow reflects real financial strength. Growing FCF indicates more flexibility for dividends, share buybacks, and reinvestment.
🧮 Calculation
🎯 What does this mean for investors?
- Declining FCF may point to rising investments, increasing costs, or weaker operating performance.
- Especially for dividend investors, FCF growth is critical – since dividends are paid from actual available cash.
- A negative trend isn't always bad, but it deserves closer attention.
📘 Gross Margin
📈 What is it?
Gross margin shows how much of a company’s revenue remains after deducting the direct costs of goods sold (like materials and production). It represents the company’s “raw profit” before fixed costs, taxes, and interest.
🧮 How is it calculated?
Or simply: Gross Margin = Gross Profit ÷ Revenue × 100
🏛️ Why is it important?
Gross margin indicates how efficiently a company can produce or procure what it sells. It is a key measure of product-level profitability and pricing power.
🧮 Calculation
🎯 What does this mean for investors?
- A high gross margin suggests strong pricing power and efficient production.
- Falling margins may signal rising input costs or competitive pressure.
- Compared to peers, gross margin offers insights into the quality of a business model.
📘 EBITDA Margin
📈 What is it?
The EBITDA margin shows how much of a company’s revenue remains as operating profit before interest, taxes, depreciation, and amortization.It reflects operating efficiency without being distorted by financing or accounting factors.
🧮 How is it calculated?
🏛️ Why is it important?
The EBITDA margin reveals how much operating income a company generates per dollar of revenue – independent of capital structure and tax effects.
🧮 Calculation
🎯 What does this mean for investors?
- A high EBITDA margin reflects strong core profitability – before accounting distortions.
- It allows for effective comparisons across companies and sectors.
- A stable or growing margin signals efficient cost control and business scalability.
📘 EBIT Margin
📈 What is it?
The EBIT margin shows what percentage of revenue remains as operating profit after depreciation but before interest and taxes.
🧮 How is it calculated?
🏛️ Why is it important?
The EBIT margin reflects a company’s core profitability while accounting for capital intensity (e.g. machinery, infrastructure). It’s especially useful for comparing businesses with different levels of depreciation.
🧮 Calculation
🎯 What does this mean for investors?
- A high EBIT margin shows that the company remains efficient even after factoring in depreciation.
- It’s especially relevant for capital-intensive industries.
- Stable or rising EBIT margins over time are a strong indicator of pricing power and business quality.
📘 Net Margin
📈 What is it?
Net margin shows how much of a company’s revenue remains as bottom-line profit after deducting all costs, interest, taxes, and depreciation.
🧮 How is it calculated?
🏛️ Why is it important?
Net margin reflects a company’s overall efficiency – across operations, financing, and taxation. It shows how much actual profit is generated from each dollar of revenue.
🧮 Calculation
🎯 What does this mean for investors?
- A high net margin means the company is not only strong operationally but also manages financing and taxes efficiently.
- Peer comparisons reveal business quality and competitiveness.
- Declining margins despite revenue growth can be a red flag for rising costs or inefficiencies.
📘 Free Cash Flow Margin | ex SBC
📈 What is it?
The Free Cash Flow Margin shows how much free cash flow a company generates relative to its revenue. In simplified terms, free cash flow is calculated as operating cash flow minus capital expenditures. The Free Cash Flow Margin ex SBC additionally accounts for stock-based compensation (SBC). While SBC does not represent a direct cash outflow, issuing shares as compensation can dilute existing shareholders. Therefore, SBC is deducted from free cash flow in this adjusted metric.
🧮 How is it calculated?
Free Cash Flow Margin ex SBC = (Free Cash Flow − SBC) ÷ Revenue × 100
🏛️ Why is it important?
The Free Cash Flow Margin shows how efficiently a company converts its revenue into free cash flow. Strong free cash flow can provide financial flexibility for dividends, share buybacks, debt repayment, or further investments. The ex SBC version additionally accounts for the economic impact of stock-based compensation and therefore provides a more conservative view of cash generation from a shareholder perspective.
🧮 Calculation
🎯 What does this mean for investors?
- A high Free Cash Flow Margin shows that a company converts a high proportion of its revenue into free cash flow.
- This can provide greater financial flexibility for dividends, share buybacks, debt repayment, or investments.
- The Free Cash Flow Margin ex SBC additionally accounts for potential shareholder dilution from stock-based compensation.
- The long-term trend is particularly important. Declining margins can, for example, result from higher investments, changes in working capital, or weaker operating performance.
📘 Equity Ratio
📈 What is it?
The equity ratio indicates what portion of a company’s total assets is financed by shareholders’ equity – in other words, how much it relies on its own capital.
🧮 How is it calculated?
🏛️ Why is it important?
A high equity ratio reflects financial strength and stability, especially during downturns. It’s a key indicator of a company’s solvency and long-term risk profile.
🧮 Calculation
🎯 What does this mean for investors?
- Companies with high equity ratios are generally more resilient and less dependent on external debt.
- Low equity ratios can signal higher risk or aggressive financial strategies.
- Important: Always assess the equity ratio in combination with the return on equity (ROE). This shows not just how stable the company is – but also how efficiently it uses shareholder capital.
📘 Return on Equity (ROE)
📈 What is it?
Return on equity (ROE) shows how efficiently a company uses its shareholders’ equity to generate profit. In other words: how much net income is earned per dollar of equity.
🧮 How is it calculated?
🏛️ Why is it important?
ROE is a core profitability metric. It helps investors understand whether a company delivers attractive returns on the capital provided by its shareholders.
🧮 Calculation
🎯 What does this mean for investors?
- A high ROE indicates that the company is using its capital efficiently and profitably.
- It’s especially meaningful for capital-intensive businesses or firms with high equity bases.
- Important: A very high ROE can also result from high debt levels – always interpret it alongside the equity ratio to assess financial health.
📘 Return on Capital Employed (ROCE)
📈 What is it?
ROCE measures how efficiently a company generates profits from its total capital – including both equity and interest-bearing debt.
🧮 How is it calculated?
It evaluates the return on all capital employed, regardless of how it’s financed.
🏛️ Why is it important?
ROCE is ideal for comparing companies with different financing structures. It shows how well management uses capital to create value for both shareholders and creditors.
🧮 Calculation
🎯 What does this mean for investors?
- A high ROCE means the company uses its capital efficiently – regardless of whether it's funded by debt or equity.
- The higher the ROCE compared to peers, the more value the company creates with its invested capital.
- Especially relevant for capital-intensive sectors like industrials, energy, or infrastructure.
📘 Return on Invested Capital (ROIC)
📈 What is it?
ROIC measures how efficiently a company generates returns from the capital invested in its core operations – regardless of whether the capital comes from equity or debt.
🧮 How is it calculated?
- NOPAT = Net Operating Profit After Taxes
- Invested Capital = Operating assets minus non-interest-bearing liabilities
🏛️ Why is it important?
ROIC is one of the most accurate indicators of capital efficiency. Unlike return on equity, it is not distorted by leverage and shows how much value is created for all capital providers.
🧮 Calculation
🎯 What does this mean for investors?
- A high ROIC shows how effectively a company uses the capital that is truly invested in its core operations.
- Unlike ROCE, ROIC focuses only on the capital that is actively used to run the business – and that requires a return (i.e. interest-bearing).
- Especially useful when comparing companies with large amounts of excess cash or non-interest-bearing liabilities – giving a more realistic picture of capital efficiency.
📘 Leverage Ratio (Debt-to-Equity)
📈 What is it?
The leverage ratio indicates how much a company relies on interest-bearing debt (such as loans and bonds) relative to its shareholders’ equity.
🧮 How is it calculated?
🏛️ Why is it important?
This ratio helps assess a company’s financial structure and risk profile. High leverage can enhance returns – but also increases exposure to interest rate changes and financial stress.
🧮 Calculation
🎯 What does this mean for investors?
- A low leverage ratio signals financial strength and independence.
- A higher ratio can improve returns in good times but increases risk during downturns or rising interest rate periods.
- 👉 Always interpret in the context of industry, capital intensity, and interest rate environment.
📘 Earnings per share (EPS)
📈 What is it?
Earnings per Share (EPS) shows how much profit is attributable to a single share – and is one of the most important metrics for evaluating a company's performance.
🧮 How is it calculated?
The diluted share count reflects potential new shares that could be issued through options, convertible bonds, or other rights.
🏛️ Why is it important?
EPS is the basis for many key valuation metrics like P/E ratio, PEG ratio, or payout ratio. It enables comparisons of profitability across companies, regardless of their size.
🧮 Calculation
🎯 What does this mean for investors?
- EPS captures per-share profitability and is especially useful for comparisons over time or with analyst estimates.
- Rising EPS may signal consistent growth or share buybacks.
- Important: Always use diluted EPS for more realistic valuations – especially in companies with stock-based compensation.
📘 Free cash flow per share (FCF per share)
📈 What is it?
Free Cash Flow per Share shows how much free cash flow a company generates per outstanding share – after investments, but before dividends or debt repayments.
🧮 How is it calculated?
Free cash flow is calculated as operating cash flow minus capital expenditures (CapEx).
🏛️ Why is it important?
FCF per Share reveals how much real cash is available per share – useful for dividends, buybacks, or reducing debt. Unlike net income, free cash flow is harder to manipulate and often seen as a more reliable metric.
🧮 Calculation
🎯 What does this mean for investors?
- High FCF per share signals strong financial flexibility.
- It shows how much capital the company can effectively reinvest or return to shareholders.
- Particularly relevant for dividend payers and capital-efficient businesses.
📘 Short interest
📈 What is it?
Short interest indicates how many shares of a company are currently sold short – that is, borrowed and sold by investors who expect the price to decline.
🧮 How is it calculated?
It reflects the percentage of a company’s shares that are being shorted relative to the total shares available.
🏛️ Why is it important?
Short interest serves as a sentiment indicator: A high value may signal skepticism or bearish expectations – but also increases the potential for a short squeeze if prices rise unexpectedly.
🎯 What does this mean for investors?
- Low short interest usually indicates market confidence in the company.
- High short interest can be a warning sign – or an opportunity if sentiment shifts.
- Especially relevant in volatile markets or ahead of key earnings releases.
📘 Employees
📈 What is it?
The employee count shows how many people a company employs worldwide – offering insights into its size, structure, and business model.
🧮 How is it calculated?
🏛️ Why is it important?
It helps assess operational scale, labor intensity, and cost structure. Combined with revenue and profit, it enables key metrics like revenue per employee or productivity.
🧮 Calculation
🎯 What does this mean for investors?
- A high headcount can signal operational complexity – but also significant growth capacity.
- Revenue per employee is a key indicator of efficiency.
- Especially useful for comparing tech, industrial, or service-heavy companies.
📘 Revenue per employee
📈 What is it?
Revenue per employee indicates how much revenue a company generates on average per employee – a key measure of efficiency and productivity.
🧮 How is it calculated?
The employee count is typically taken from the most recent annual report.
🏛️ Why is it important?
This metric helps compare business models – especially between labor-intensive and technology-driven companies. A high value suggests automation, operational efficiency, or strong value creation per head.
🧮 Calculation
🎯 What does this mean for investors?
- A high revenue per employee indicates a scalable and margin-strong business model.
- A low figure may reflect labor-intensive operations or lower value-add.
- Especially helpful when comparing tech companies to industrial or service sectors.
Bufab Stock Analysis
Analyst Opinions
12 Analysts have issued a Bufab forecast:
Analyst Opinions
12 Analysts have issued a Bufab forecast:
Bufab Events
Past Events
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OCT
23
Q3 2026 Earnings Call
8 days ago
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JUL
14
Q2 2026 Earnings Call
4 months ago
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APR
23
Q1 2026 Earnings Call
6 months ago
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FEB
5
Q4 2025 Earnings Call
9 months ago
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OCT
24
Q3 2025 Earnings Call
about one year ago
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StocksGuide Free
Bufab — Q3 2026 Earnings Call
1. Management Discussion
Good morning and good afternoon, everyone, and warm welcome to Bufab's Q3 report. My name is Erik Lunden, President and CEO of Bufab Group, and together with me today, I have my CFO, Marcus Soderberg. This presentation will be recorded, and by attending the meeting, you agree to the recording. I will start to take us through the highlights of the quarter. Then I will leave the word with Marcus for some financial highlights. After that, I will go through the performance in each of the regions before we sum up the quarter. Let's start with the Q3 highlights. I'm overall very pleased to report another strong quarter for Bufab. We could deliver strong organic growth and achieved significant improvements and record margins on both gross and operating margin. We continue to execute very well on our strategy with clear focus on value creation for our customers.
We deliver a total growth of 16.6% with a strong organic growth of 6.5%, driven by market share gains and somewhat stronger underlying demand in the market. The demand was particularly strong in electronics, mechatronics, electrification, digital infrastructure, aerospace, and defense. The gross margin improved by 1.6 percentage points, which a record high 34.3%. This ended up into a strong adjusted operating margin of 15.6% and almost all our operating companies improved the results, with particularly strong improvements for our sisters in Europe West and Asia Pacific. I am also very pleased with the start for D.C. Iron, which we acquired at the beginning of the quarter. The company has developed very well. It is early stage, but so far very good start and integration process is progressing according to plan.
I will now leave the word over to Marcus for some financial highlights.
Thank you very much, Erik. We start by turning to slide 6 in the presentation, looking at the growth. The growth trend continued in the third quarter. Net sales increased by 16.6% to SEK 2,236 million. Acquisitions, meaning novia in Q4 2025 and D.C. Iron, acquired in this quarter, contributed to 9.5 percentage point out of the total. Currency had a slight positive impact with 0.7 percentage points, and organic growth was strong 6.5% in the quarter. By reporting a strong organic growth also in this quarter, we marked the fifth consecutive quarter of organic growth for the group. Order intake was in line with net sales. The organic growth was strongest in Asia Pacific as well as in Europe West, but also U.K., Ireland, as well as North and East also contributed positively.
It is basically only Americas where we had negative organic growth, and the reason for this is mainly due to one-time refunds of previously paid customs duties as well as slight lower demand within the RV and automotive markets. We turn to slide 7 in the presentation, where we see gross margin development as well as OpEx development and the gross margin in the quarter, the margin reached a record level of 34.3%, up 1.6 percentage points year on year. All regions improved their gross margin. The drivers remain the same, basically as in the recent quarters. A better customer mix and product mix, combined with more value-based pricing as well as some sourcing savings. OpEx amounted to 18.1% of sales.
This was positively affected by a revaluation of earn-outs amounting to SEK 20 million, but we also have a negative impact of SEK 7 million in connection with transaction cost for D.C. Iron at the beginning of the quarter. Adjusted for those items, OpEx ratio, as a percent of net sales, was 18.7%, meaning a decrease of 0.2 percentage point year-over-year. We continue to see good cost control as we grow. We turn page to slide 8 in the presentation, where we see the operating margin development. I guess we can sum it up basically like this, that the strong top-line growth that we saw in the quarter, the high gross margin, and the good cost control in terms of OpEx resulted in a record high adjusted operating margin of 15.6% in the quarter, compared to 14.2% last year.
Adjusted EBITDA increased by strong 28% to SEK 349 million. Behind the increase, it's basically 4 of our 5 regions that improved their operating margin. Only Americas not making a year-over-year increase, but they remained on a very solid or strong level of 20.8% despite the lower top line. We turn to slide 9 in the presentation where we see the development of our cash flow in the quarter. As you can see, cash flow from operating activities increased to SEK 370 million in the quarter compared to SEK 293 million last year. It's actually marking the strongest quarter so far in 2026. The increase is mainly explained by what we already have talked about, meaning the improved underlying result. Working capital contributed slightly positive despite an inventory increase due to the organic growth we saw in the quarter. So strong organic cash flow generation despite strong organic growth.
We turn to page 10 in the presentation where we see the development of our indebtedness and net debt versus EBITDA. Net debt decreased by around SEK 50 million during the quarter to SEK 3,444 million, which includes leasing. This was achieved despite the acquisition of D.C. Iron in the beginning of the quarter. Adjusted net debt versus EBITDA improved to 2.2x from 2.4x at the end of the last quarter. It was also actually a year-over-year decrease with 0.1 percentage point. Also that when taking into consideration that we made quite a big acquisition in Q4 last year, meaning novia, as well as the acquisition of D.C. Iron in the beginning of the third quarter. We're very happy with the strength and balance sheet during the quarter, driven by increase in underlying result, together with the strong capital that we have seen.
With that said, I'll leave the word over to Erik again to go through with the different regions.
Thanks, Marcus. We will then start with the performance in region Europe North and East. Net sales increased by 3.2% in the region, of which organic growth was 3.0%. Several companies continue to develop very well in the region, particularly Norway, Poland and Hungary, as well as BUMAX, supported by strong market share gains. Demand in defense, digital infrastructure, electrification remained strong, while the construction and furniture industries remain on a low level. The gross margin developed very well, increasing by 1.9 percentage points. This was driven by improved customer product mix together with our continued focus on value-based selling. The region's cost level increased mainly due to foreign exchange losses on operating receivables, somewhat higher obsolescence costs, and also investments in growth. Despite this higher cost, the improvement in gross margin more than offset the high expense ratio.
As a result, the adjusted operating margin improved to 15.6%, compared with the 14.6% in the comparative quarter. If we then continue to Europe West. Net sales increased by 39% during the quarter, with very strong organic growth of 14.2%. The acquisition of novia Group contributed by 25.2%. The strong organic growth was driven by continued market share gains, improved product mix and previously communicated larger projects which are progressing according to plan. Looking at the demand, we saw particular strength in mechatronics, aerospace, electricity and defense. The gross margin increased by 2.4 percentage points, driven by improved product mix and higher value added from new projects. The operating expense ratio, adjusted for the evaluation of contingent purchase considerations of SEK 20 million, decreased to minus 12.8%. The improved operating expense ratio was a direct result of strong operating leverage on additional volumes, combined with the solid cost control in the region.
All in all, this resulted in significant improvement in profitability, with adjusted operating margin increasing to 15.4% compared to 12.7% in the comparative quarter. Finally, the recently acquired novia Group delivered a stable performance in the quarter for Europe West. If we then continue with region Americas. They had a total growth that was negative by 6.6%, of which organic growth was minus 8%. The negative organic growth was due to refunds of previously paid customs duties, lower demand in the RV and automotive markets, and a strong comparative quarter. Adjusted for the refunded customs duties, organic growth was minus 4.3%. Despite lower volumes, we saw a strong improvement in gross margin, which increased by 3.4 percentage points. This was primarily driven by general price adjustments and our continued successful efforts to improve profitability within the CST group in the U.S.
The lower organic growth also resulted in somewhat higher cost level relative to sales, together with somewhat higher obsolescence cost for the region. Overall, the adjusted operating margin remained at a strong level of 20.8%, compared to 22.2% in the comparative quarter. Continue then with the region U.K., Ireland. Net sales grew strongly by 20.2%, while organic growth was solid 5.4%. D.C. Iron, acquired at the beginning of July, contributed with 13.4% to the sales development for the region. TIMCO continued to deliver robust sales despite the weak construction market, while rising stainless steel prices supported a slight improvement for Apex. We also saw strong improvements in gross margin, up 2.4 percentage points year-on-year.
This reflected a better customer product mix, higher price on stainless steel prices, and the addition of D.C. Iron, which has a somewhat higher gross margin than the rest of the companies in the region. The cost level was somewhat higher, reflecting transaction costs for acquisition of novia. Sorry, for D.C. Iron. Adjusted for these costs, the operating expense ratio was 22.1% compared with 22.6% in the comparative period. Altogether, this resulted in a strong improvement in the adjusted operating margin, reaching 13.8% compared to 10.7% in the comparative quarter. Finally, Asia-Pacific. We saw very strong growth in the region with total growth of 22% and organic growth of 28.4%. The development was particularly strong in the Bufab Shanghai and Bufab India, driven mainly by continued strong growth within energy industrial automation solutions.
Gross margin also improved significantly by 6.0 percentage points, reflecting continued value-based pricing, a better customer product mix, and also purchasing savings. At the same time, the high volumes provided strong operating leverage combined with continued good cost control, and altogether this drove a substantial improvement in profitability, reaching an operating margin of 21.1% compared to 14.3% in the comparative quarter. I will then go through 2 group news, and I will start with the customer case. Today, I will talk about our customer, Knorr-Bremse. Knorr-Bremse is a market leader within rail and commercial vehicle braking systems, with operations in more than 100 locations globally. They have a broad product portfolio and a relatively complex C-parts and technical components requirements within their operation. When KB started to interact with Bufab, they had a clear mission to consolidate their broad supply base and to lower their total cost.
We at Bufab saw in early stage a big opportunity to support KB on their journey and create peace of mind within their C-parts and technical components space. Today, we support KB with end-to-end solutions covering sourcing, quality, sustainability, and logistics. We create clear value through tailor-made solutions that suits KB's needs on each site. We are today one of KB's three strategic global distributors, supporting more than 30 sites in total, with big opportunities for further growth into new commodities and also to more sites globally. Hopefully, it's the starting point with the growth journey together with Knorr-Bremse. I would also like to take the opportunity to welcome you all to Bufab's Capital Markets Day that will take place in Stockholm on December 10.
Please register by sending an email to sofie.unnersjo@bufab, and I hope to see you all in Stockholm in the beginning of December. Finally, I will end this call by sum up the quarter and say a few words about the priorities ahead. To sum up, I'm overall very pleased with the performance in the quarter. We delivered a strong organic growth of 6.5% and record high gross and operating margin. We have now seen strong year-over-year development in our gross margin for 13 consecutive quarters, and we expect the gross margin to continue to improve during the rest of the year. Looking at the market, the geopolitical uncertainty remains, but we saw some improvements in the market during the quarter. We also see somewhat higher purchasing prices from Asia, that we will of course handle as we normally do in Bufab in a good way.
Looking ahead, our priorities will remain the same. We will continue to execute on our strategy, take the opportunity to gain market share, gradually improving our margins, and have good control of our cost base. Of course, delivering a solid cash flow. We will focus to continue our value journey with clear focus on improving for our customers and also improving our product mix, and also continue our work with implementing value-based pricing organization. Overall, we have a very strong momentum in the organization, and I think we are very well positioned for the coming years, to serve our customers in an even better way.
That was my final slide for today. I will now leave the floor open for Q&A, please.
[Operator Instructions] We start with the first question from [ Laura Mourtadi ]. Please ask your question.
2. Question Answer
Just a couple of questions from my end. You said that you expect the gross margin to continue to improve for the rest of the year, but as you mentioned, you also see higher purchasing prices in Asia. Do you mean that year on year or also above this Q3 level? Also, how quickly can you pass the Asia increases on?
As I mentioned, we expect the gross margin to continue. That, I think, is based on work we have done, I would say many quarters and years back, actually. It is not a short-term impact. It is a long-term working that our system done to gradually improve our gross margin, so that is sustainable. When it comes to changes in the price level from Asia and also even before saw increases from Europe, that is something that is natural for us to work with and pass on to our customers, and we do not see that impacting us in a negative way.
Okay. Very clear. Are you maybe able to split out how much of the organic growth that was price versus volume?
Normally, we do not go into that kind of details. The only thing that we can say is that it is basically a combination between taking market share, increased volumes that we saw a bit more now in this quarter, maybe, relative to the previous quarter 2026, as well as a price component. But we do not go into these stages when it comes to that.
Okay. On the duty refunds in the Americas segment, can you specify what the EBITDA impact was? Also just on the broader market, are you seeing any signs of stabilizations in the RV and automotive markets?
Sorry, can you repeat the first question? What did you say? We lost you there.
The duty refunds, the EBITDA impact, could you specify what it was in the quarter?
Yes. Basically, it's krona per krona refund mainly. The actual impact on EBITDA level is not to be considered as significant at all. It's basically a growth item mainly.
Okay. My second question was more on the broader market. You mentioned that you haven't really been seeing signs of stabilization in RV or automotive. Is that correct?
Yes. If you take overall, we see somewhat improved demand in the different markets. When it comes to U.S. market, where we have most of our automotive business, it's still a low demand for automotive in U.S. specifically. That's what I comment.
Okay. Also, just you mentioned that your organic growth was, primarily it was a mix of things, but you mentioned market share gains. Who are you taking share from? What is winning it for you? Is it the service sourcing or pricing at this stage in the market?
Yes. We are mainly competing with small local players. Our customers, specifically in the trading part of our business, they are helping our customers with consolidation of a big amount of suppliers, where we have a very strong offering compared to small local players. We are mainly taking market share from local players, and we can see a good development market share-wise in several regions and in many countries in the quarter. I am pleased with that performance. You had one more question there. Sorry, can you repeat that one as well?
I think that was clear.
Since there are no further questions, I hand over to Erik to close this call.
Okay. Thanks everyone for joining this call. Once again, warm welcome to our Capital Markets Day in Stockholm in December. Thank you.
Thank you.
Bufab — Q3 2026 Earnings Call
Bufab — Q2 2026 Earnings Call
1. Management Discussion
Good morning, and good afternoon, everyone, and a warm welcome to Bufab's Q2 report. My name is Erik Lunden, President and CEO of Bufab Group. And together with me here today I have Marcus Soderberg, Group CFO. By attending this meeting, you accept that this meeting will be recorded.
I will start this presentation to go through our highlights in the quarter and then leave the word over to Marcus for some financial details. After that, I will sum up our performance in each region, some group news, and then at the end, sum up the quarter and also time for Q&A.
If we then start with the highlights in the quarter, I'm overall pleased with our performance. We delivered strong growth and improvement in both gross margin and operating margins. We continue to execute very well on our strategy with a clear focus on value creation for our customers through tailormade solutions [indiscernible]. Organic growth is at strong 5.3%, in line with our growth target and with a positive development in all regions. The growth was mainly driven by increasing market shares with positive contribution from our previously communicated larger projects.
The underlying demand remained cautious during the quarter. We saw good demand in sectors such as energy, digital infrastructure and defense, while demand in construction, kitchen and bathroom, and the automotive industry remained weak. Both gross margin and operating margin reached high levels in the quarter. The gross margin improved by 2.1 percentage points and reached high 33.2%.
Over the 12 last quarters, we delivered improved gross margin compared to comparison quarters, and we expect this trend to continue throughout 2026. The adjusted operating margin amounted to a strong 14.7%, which means that we now consistently improved our profitability compared with the previous year over the past 7 quarters. All regions and almost all our sister companies improved the results compared to last year.
At the beginning of July, we announced the acquisition of DC Iron, one of U.K.'s leading distributors of iron work parts. This acquisition is in line with our strategy of acquiring profitable companies in attractive niches within C-parts and technical components. And I will come back with more details on this acquisition later in this call.
I will now leave the word over to Marcus for some financial highlights.
Thank you, Erik. So we start by having a look at the development in terms of growth. Total growth in the quarter amounted to strong 11.7%. We continue to see a gradual improvement of the organic growth throughout the quarter, which [indiscernible] now with this quarter, the fourth consecutive quarter where we see organic growth. The growth was mainly driven by increased market shares, like Erik said, and also by the previously communicated larger projects. What's really nice to see in this particular quarter is that it's actually organic growth in all our segments. The acquisition of novia that developed in accordance to plan within the quarter contributed with 7.2% to overall growth in the quarter, while the strengthened Swedish krona had a slight negative impact in the quarter. During 2025, communicated divestment within Component Solutions Group within segment Americas had a minor negative effect on growth with 0.3 percentage points. Order intake, this has to be mentioned, was in line with net sales in the quarter.
If we look at the gross margin and OpEx development, we are very satisfied with the gross margin development in the quarter, which increased compared to the comparative quarter and reached strong levels of 33.2% compared to 31.1% in previous year, an increase of 2.1 percentage points. All regions and most companies increased their gross margin in the quarter, which is really nice to see. The increased gross margin is a result of focused work to continue to improve both our customer and product mix as well as landed purchase savings in the quarter, some positive currency effects compared to the comparable quarter, as well as certain price adjustments made. Over the past 12 quarters now, we have seen strong momentum in the gross margin development, a development that we expect to continue throughout the rest of 2026.
Operating expenses in comparison to net sales amounted to 18.5%. This is slightly higher than previous year. We still have quite a big focus on strong cost control, but at the same time, we continue to invest in certain growth opportunities and initiatives in selected companies. All in all, a growing top line in combination with a continued strong gross margin development, paired with good cost control led to a clear improvement in both absolute adjusted operating profit and margin in the quarter. Adjusted operating profit increased with SEK 65 million or 24.2% versus the comparative quarter and landing on SEK 333 million. The adjusted operating margin increased with 1.6 percentage points to 14.7 percentage points compared to 13.1% last year. What's really nice to see is that all segments increased both their adjusted operating profit in absolute figures as well as their adjusted operating margin quarter-to-quarter. Given the strong first half of the year, we now are well on track to reach our long-term margin target for the full year of 2026.
Cash flow-wise, cash flow increased versus the comparative quarter, a direct result of the improved underlying result. Cash flow was also somewhat supported by a reduction in net working capital. The buildup of accounts receivables fueled by the strong organic growth in the quarter was more than offset by inventory reductions and somewhat higher accounts payable. What deserves to be mentioned is the increased noncash item figure in the cash flow statement versus the comparable quarter. It's mainly driven by an accrual buildup related to CBAM cost. CBAM, as some of you might know that much about, is EU's new carbon border adjustment mechanism, which affects our European companies from January 1, 2026. And since the cost that we carry due to this new regulation has not yet been paid out, they have been increasing the noncash item in the cash flow compared to previous year. And according to current regulations, the accumulated CBAM provision is expected to be settled during the first 3 quarters of 2027.
Net debt and net debt versus EBITA-wise, we remain at a solid 2.4 multiple despite dividend payment and currency effect. As you know, we've made some dividend payments in late April. And that, together with some unfavorable foreign exchange effects on our acquisitions loans in the quarter, led to a slightly increased debt, which was fully basically offset by the increased EBITA, strong development in the quarter, meaning that we stay on a leverage of 2.4. And the stable leverage level was supported, as I said, by the strong underlying EBITA growth, demonstrating the strength of the group's earnings development and cash generation in the quarter.
With that, I leave the word over to you, Erik.
Thanks, Marcus. And I will continue then with some highlights from each of the regions, and I will start with the region Europe North & East. Total growth in the region was 3.8%, of which organic growth was 3.8%. Market conditions continue to vary across countries and customer segments in the region. We saw positive development in Norway, Poland and in Bumax due to increased market share. The furniture and kitchen sector for HT Bendix continued to face lower demand, whereas demand in defense, digital infrastructure and electrification were strong in the quarter.
The gross margin was very strong, reaching 35.1%, an improvement by 3.9 percentage points, driven by a better customer and product mix and consolidation of purchasing volumes and currency effects.
Operating expenses increased quarter-to-quarter, mainly as a result of currency losses and higher personnel costs in the region. Overall, this resulted in improved and strong adjusted operating margin of 16.4% compared to 14% last year.
If we then continue with the Region Europe West, the total growth in the quarter for the region was 35.8%, a very strong number. The growth was largely driven by acquisition of novia Group last year, which contributed by 26.6%, while the organic growth came in at a strong 10.1%. The organic growth was driven by strong development at Flos in the Netherlands, Bufab Spain and Bufab Czech, supported by increasing market shares in several markets, including positive contribution from our big project with a semiconductor player in the Netherlands and also better product mix in the region.
The demand was particularly strong in sectors such as mechatronics, aerospace and defense in the region. The gross margin improved by 1.3 percentage points, driven by improved product mix and higher added value in new projects. The cost level was lower than last year. As a result of the strong growth, improved gross margin and lower cost base, the adjusted operating margin improved to 13.8% compared to 11.8% last year. The newly acquired novia Group performed according to plan during the quarter.
Continue then with the Region Americas. The total growth was minus 3.2%, which organic growth was positive 2.6% and organic growth was mainly driven by price increases driven by CSG. The demand in the RV and trailer market, which is an important segment for ABS, remained stable, but on a low level. We saw longer-than-usual plant closures during American holidays in the quarter and lower demand continued in the automotive industry, which particularly impacted CSG.
The gross margin improved by 1.6 percentage points. The improvement was mainly driven by general price adjustments and a successful turnaround within our sister company, CSG. The cost level was lower compared with last year, mainly due to divestment of CSG production facility, combined with continued good cost control in the region. Overall, this resulted in a strong improvement in the adjusted operating margin, which increased to 21.1% compared with 19.3% in the comparative quarter.
We continue then with Region U.K. & Ireland. The total growth in the region was minus 2.3% with organic growth of positive 0.3%. We continue to see a weak demand in the construction industry impacting TIMCO in the region. Rising market prices of stainless steel impacted Apex in a positive way, and Bufab U.K. benefited from increased market share.
The gross margin improved by 2.2 percentage points, mainly driven by rising prices of stainless steel, sourcing savings and somewhat lower freight costs in the region. The total cost level was higher compared with last year. This was explained by positive foreign currency translation, and underlying cost development continues to be characterized by good cost control overall. This resulted in improvement in adjusting operating margin to 12.0% compared with 10.8% in the comparative period.
Finally, Region Asia-Pacific. The total growth amounted to 14.6% with strong organic growth of 14.9% for the region. The strong growth was mainly driven by Bufab Shanghai and Bufab India, and impacted by strong growth within energy and industrial automation. The gross margin improved by strong 3.5 percentage points. The improvement was driven by continued active work with implementation of value-based pricing, improved customer and product mix as well as purchasing savings. The cost level was lower compared with last year, primarily as a result of higher volumes, currency effects, but also thanks to continued good cost control in the region. A strong development in all levels led to impressive improvement of the adjusted operating margin, reaching 20.9% compared with 13.7% in the comparative quarter.
I will after that continue with some group news, and I'd like to start to talk about the acquisition of DC Iron that we signed in the beginning of July. And DC Iron is a U.K.-based distributor of iron work parts. The company supplies products to fencing gate systems, iron components and key clamps systems to fabricators, engineering companies and contractors across the U.K. DC Iron have a turnover of GBP 14.8 million last year with margins significantly above Bufab's profitability target of 14% on EBITA level. The company is based in Newcastle, U.K., and has 40 employees. The former owner MD, Scott Collins, will continue as MD after acquisition. And of course, it is great for me to welcome Scott and his team to Bufab. We acquired 100% of the shares with a 3-year earn-out, and DC Iron will be reported as a niche company within Region U.K. & Ireland.
So why do we acquire DC Iron? We see DC Iron as a strong fit for Bufab. It is in line with our strategy of acquiring profitable companies and attractive niches within C-parts and technical components. The company operates in an attractive and resilient niche market and are one of the leading players within their niche. We have a strong product range, low customer concentration with end customers in segments such as infrastructure, public indoor and safety. Looking back, DC Iron delivered excellent growth and profit, and we see great opportunities in the Bufab family to continue this positive trend. To conclude, we see a strong culture and commercial fit for Bufab and acquisition fully in line with our long-term strategy.
Finally, on the group news, I'm happy to share that Bufab Shanghai has been awarded as Excellent Cooperative Supplier by Schneider Electric at Schneider Electric's Supplier Day 2026. Bufab have been working closely with Schneider globally for many years, and we have today a strong collaboration with Schneider globally, but also in China. In China, Bufab Shanghai has gradually been growing with Schneider and is today supporting 20 of Schneider's 23 manufacturing sites in China and are today seen as a long-term partner to Schneider.
Bufab Shanghai got award for the tailor-made end-to-end solutions, including VMI services, R&D support and strong customer service. For me, this recognition demonstrates our ability to support customers throughout the value chain, from product development to efficient and resilient supply chain solutions. We will, of course, continue our value creation journey with our customers and ensure that we build long-term partnerships through our services in line with our strategy in the Bufab family.
I will end this call with summing up the quarters and say a few words about our outlook and priorities. To sum up, I'm overall pleased with our performance in the second quarter. We continue to execute very well on our strategy, and we delivered strong organic growth, clear improvements in both gross and operating margins, and all regions and almost all our sister companies improved the results year-on-year. Over the past 12 quarters, we have seen a strong momentum in our gross margin, a development we expect to continue during 2026. We have, over the last couple of years, worked actively with our value creation for our customers, implement more value-based pricing across the organization, gradually improving our customer product mix, and this has clearly started to pay off, and we are well on track to achieving our margin target for the year.
As previously communicated, we have not been affected directly by the Iran war and the disruption in the Strait of Hormuz, but we continue to see cautious market and cautious approach among our customers and somewhat increasing purchasing prices from Asia lately. Our focus going forward remains the same, and that is to focus on things we can control and continue to execute well on our strategy with clear focus on value creation for our customers. This includes continue gaining market shares, gradual improvement in gross margin and a good cost control and, of course, delivering a strong cash flow. If doing a good job here, this will put us in a good position when the market demand returns. Despite the continued uncertainty in the world, we remain optimistic about the future and believe that we have a strong momentum for the future.
That was my final slide for today. I will now open up the floor for Q&A, please.
[Operator Instructions] We start with the first question from Jonny Jin, and he is from SEB.
2. Question Answer
I have a couple of questions. I want to start with the strong organic growth, which is good to see, but I want to break down this a little bit further. So starting in West here, 10% organic growth, a clear pick up here. Is that a reflection mostly on previously won contract that is now being fully ramped up? Or is it even more to come in the near term? Or is it sort of other market share gains you're taking in the quarter? Can you maybe elaborate there?
Sure. Yes, it's a combination. We are doing well overall in the region, and we have several sister companies that are performing well and grabbing market share. And on top of that, we also have a very good momentum in Netherlands with the big semiconductor player that is ramping up. So that is also contributing positively to the organic growth. So it is a mix between overall good performance in many sisters and that we're ramping up the semiconductor partnership that we have in Netherlands with a big semiconductor player.
Understood. Is it still ramping? Or is it sort of this level?
We still have ramping up phase. So still is ramping up and hopefully more to come.
Understood. Sounds promising. Then I want to move to Asia a little bit, also very strong growth. What is happening there? Is there any sort of project sales impacting positively here in this quarter? Or is it pure regular market share gains there as well?
No, it's, I think, regular market share gains. As I mentioned, when I talked about the region's performance, we see really strong momentum in China, and we have seen that for quite many quarters, doing a good job with many of our customers there. And on top of that, we also see very good performance from Bufab India in the quarter. And that combined put us in a very strong performance in the quarter. So it's mainly driven by good performance in India and China.
Understood. And then U.K. here, also very positive jump. It's nice to see that it's now a positive trajectory again or territory. Do you see like sort of a general market stabilization in U.K. from here? Or can we -- were something special impacting U.K. in this quarter? Or is it only market share gains there as well?
The market remains cautious, I would say, in U.K. So TIMCO that operate in construction is facing a tough market condition out there still. So no improvements whatsoever. What we see, slightly positive effect is the prices on stainless that impacts Apex in a positive way. That gives some impact in a positive way for Apex. But the overall market condition is still tough and quite cautious in the region. So no improvements in the quarter.
Understand. And the price effect here of organic growth in this quarter. I mean, has price effect already started to show -- the accelerating price effect in this quarter? Or is the acceleration this quarter mainly a reflection of volume, would you say?
Mainly volume.
Okay. And then gross margin, I mean, yes, obviously, very strong again and impressive. It's strong also in all regions, which I understand is a reflection of your strategy execution and mix. But in America, specifically, 42.4% gross margin seems very strong here despite tough comparables. So besides these structural changes, were there any temporary effects impacting Americas gross margin in this quarter?
No.
Okay. That's clear. And then on tariffs, I mean, some companies are receiving tariff refunds from the U.S. now. Is that something you are expecting as well? Or...
No, not what we have seen so far. So let's see what will happen, but we have not seen it so far.
Understand. Understand. Just one final sort of question. But in segments North & East here, you mentioned some increased personnel costs due to growth initiatives here. What is that more specifically? I mean, are you having a new contract you are preparing to ramp up? Or is that something special you want to mention?
No, that's mainly linked to bonus accruals, I guess, because of some development in the quarter. Marcus, you want to add more?
Yes. I mean most of the cost add-on is obviously coming from the people side, given that that's the biggest part of the OpEx in Bufab. So it's investments within that area in the last couple of quarters.
Since there seems to be no further questions, I hand over to Erik to close the meeting.
Okay. So thanks, everyone, for joining this call. I wish you all a nice day and summer. So thanks for joining. Bye-bye.
Bufab — Q2 2026 Earnings Call
Bufab — Q1 2026 Earnings Call
1. Management Discussion
Good morning, and good afternoon, everyone, and a warm welcome to this Q1 report from Bufab. My name is Erik Lunden, President and CEO of Bufab Group. And together with me here, I have Marcus Soderberg, our Group CFO. This presentation will be recorded and by attending to the meeting, you agree to the recording. I will start this presentation to give you the highlights of the quarter. After that, I will leave the word over to Marcus for some financial highlights. Then I will take you through the different regions' performance. And at the end, we will have time for sum up and Q&A.
If we start then with the highlights of the quarter, I would say that it's a good quarter from our side. I'm overall very pleased with our performance. We delivered organic growth and clear improvements in both gross margin and operating margin. I think we execute very well on our strategy with a clear focus on improved value creation for our customers through our offering and also solutions, and this work has clearly started to pay off in the quarter. The organic growth was 2.2% with positive development in 3 of the 5 regions, driven by mainly higher volumes. The underlying demand remained cautious in the market. We saw good demand in industries like energy, agriculture and food and defense, while demand in construction, furniture and interior design continued to be on a low level.
Both the gross margin and the operating margin increased compared with the comparative quarter and reached all-time high levels. The gross margin improved to 32.9% versus 30.3% last year, and we have now delivered 11 quarters with improved gross margin compared to comparison quarter. Our underlying cost level was slightly lower than last year, and we continue to maintain a good focus on cost control, while at the same time, we invest in growth where it makes sense. All in all, we delivered a strong adjusted EBITA margin of 15.3%. It's up compared to last Q1 in 2025, that was 12.7%. And it's also very encouraging to see that all regions and the vast majority of our sister companies contributed positively to this result by improving their performance versus last year.
I will now leave the word over to Marcus for some financial highlights.
Thanks a lot, Erik. So we'll start looking at the growth during the quarter. We did see organic growth, but still see the underlying demand to remain a bit cautious. But in total, the growth in the quarter amounted to 1.7%. We continue to see a gradual improvement of the organic growth, which is good, which came in on 2.2%. It's now actually the third consecutive quarter in which we see a gradual improvement of the organic growth rate, which we're very glad to see.
The acquisition of novia had a solid development in the quarter, contributed with 6.5 percentage points to the overall growth in the quarter, while the strengthened Swedish krona had a negative impact currency-wise of minus 6.5 percentage points. There was a small effect also coming from the during 2025 communicated divestment within Component Solutions Group that had a negative impact of 0.5 percentage points.
In terms of order intake, it should also be said that in the quarter, order intake exceeded net sales. Gross margin-wise, we are very satisfied with the gross margin development in the quarter. It increased compared to the comparative quarter and reached a high level of 32.9% versus 30.3% in the comparative quarter, an increase of 2.6 percentage points. The increased gross margin is a result of a continuous focused work to improve both our customer and product mix, landed purchase savings in the quarter, some price adjustments as well as the strengthened Swedish krona effect on the Swedish entities.
Over the past 11 quarters, like Erik said, we have seen strong momentum in our gross margin, and we expect this development to continue throughout the year. In terms of operating expenses, operating expenses as a percent of net sales increased slightly compared to the comparative quarter and amounted to 17.6% versus 17.2%. But if we adjust for the acquisition of novia made in Q4 '25, and the revaluation of contingent purchase considerations in the comparative quarter, the operating expenses as a percentage of net sales actually decreased slightly. So still good cost control. The lower underlying operating expenses is also a direct result from continuous strong focus on exactly cost control throughout the whole organization. And while maintaining good cost control, we also continue to invest in various growth activities such as investing in our sales organization, et cetera.
So clear improvement in operating margin. We are well on track to reach our overall margin target as a summary. And as I said, strong gross margin in combination with the good cost control that we saw in the quarter led to a clear improvement in the operating margin that landed on a strong level of 15.3% compared to 12.7% in the comparative quarter. Adjusted operating increased with SEK 62 million, meaning a growth rate of 22% to SEK 340 million versus SEK 278 million in the comparative quarter. It's nice to see that all segments increased its operating margin and the vast majority of our operating entities actually improved their overall result as well, which is also very nice to see. Given the strong start of the year, we are now well on track to reach our margin target for the full year of 2026.
Cash flow-wise, cash flow increased versus the comparative quarter, actually a direct result of the improved underlying result. There is one thing standing out a bit in the cash flow statement, and that is the noncash item figure in the cash flow statement that is considerably higher versus the comparable quarter. And the main driver behind this is that we build up accruals for the future payment of CBAM, that is EU's new carbon border adjustment mechanism, which affect all our European companies with start of January 1, meaning affecting all our purchases in the European countries from January 1. And the payment for those costs will be due in 2027. So we accrue for those during 2026.
Other things worth mentioning is that, as you can see, we build slightly more net working capital in this quarter relative to the comparable quarter, but the development of that is naturally due to that we are now back in organic growth phase, which is good. So solid cash flow in the quarter.
If you take a look at the balance sheet, we continue to strengthen the balance sheet throughout the quarter. Debt-wise, the group took good steps in the right direction, driven by a solid cash flow in the quarter. We reduced the overall debt level of approximately SEK 90 million despite the fact that we have a strengthened Swedish krona affecting the loans for the acquired companies negatively in the quarter. But still, we were able to reduce debt with approximately SEK 90 million.
Reduced debt in combination with strong development of our operating underlying result in the quarter also led to an improved net debt-to-EBITDA multiple. Net debt-to-EBITDA decreased with 0.2 multiple points, down to a multiple of 2.4, which is well within our financial target range long term. So I guess you can say that we continue to strengthen our balance sheet after acquisition of novia already, meaning we are ready for new value-adding acquisitions when the right opportunities appear.
With that said, I'll leave the word over to you, Erik, again.
Thanks, Marcus. And I will then take you through the regional highlights, and I would like to start with the Region Europe, North and East. The total growth for the region was minus 1.3%, of which organic growth was positive 1.7%. Market conditions continue to vary across countries and customer segments in the region. We saw positive development in Finland and Sweden, while demand in Denmark remained weak. The furniture and kitchen sector continued to face lower demand where defense and digital infrastructure remained strong in the quarter.
The gross margin improved by 3.0 percentage points, driven by better customer and product mix and the consolidation of purchasing volumes. As in the previous quarters, currency effects have also had a positive impact on the gross margin for the region. Operating expenses increased quarter-to-quarter, mainly due to remeasured additional purchase considerations in the comparable quarter. Adjusted for those effects, the share of cost increased only slightly compared to last year. Overall, this resulted in an improved adjusted operating margin of 16.1% compared with 14.2% last year.
If we then continue with the Region West, the region showed a strong growth of 24.7%. This growth was largely driven by the acquisition of novia Group, which contributed by 23.7%, while organic growth came in at a solid level of 6.3%. The organic growth was driven by strong development in France, Spain, Turkey and Czech Republic, and supported by increasing market shares and also better product mix in the region. The demand was particularly strong in sectors such as mechatronics, aerospace and defense.
Also, the gross margin had a positive development, improved by 2.2 percentage points, driven by better product mix and higher added value in the new projects. The cost level was in line with last year, reflecting continued cost discipline in the region despite higher activity in the market. As a result, the adjusted operating margin improved to 15.3% compared with 13.4% last year. Finally, worth to mention is that the newly acquired novia Group developed according to plan during the quarter and contributed positively to the region.
If we continue with Americas, the total growth for Americas in the quarter was minus 6.1%, mainly impacted by currency effects, which accounted for negative 13.4%. At the same time, the organic growth was strong at 11.6%. The organic growth was mainly driven by price increases and demand in the RV and the trailer market, which is an important segment for ABS. It remained stable, but on a low level. We also continue to see weak demand in the automotive industry, which particularly affected our sister company CSG in the U.S.
The gross margin improved significantly, increasing by 7.7 percentage points. This was mainly driven by general pricing adjustments and also very successful turnaround within our sister company CSG. Looking ahead, we expect the gross margin to come down slightly going forward, but remain on a high level for the region. The cost level was lower compared with last year, mainly due to the divestments of BGM within CSG, combined with continued good cost control in the region. Overall, this resulted in a strong improvement in adjusted operating margin, which increased to 21.7% compared with 12.5% in the comparative period.
If we then continue with the Region U.K. and Ireland, the total growth in the quarter was minus 12.2% with organic growth of minus 3.8%. We continue to see a low demand in the manufacturing industry, impacting both Bufab U.K. and Ireland, combined with lower market prices, which impact Apex that are doing stainless. But also weak confidence within the U.K. construction market, combined with unfavorable weather in Q1 resulted in lower sales volumes for TIMCO. The gross margin improved by 2.0 percentage points, mainly driven by sourcing savings and lower freight costs. The cost level for the region was lower compared with last year. This is partly explained by the fact that the comparative quarter was negatively impacted by customer loss as well as restructuring costs for mainly Apex. Overall, this resulted in an improvement in adjusted operating margin, reaching 11.7% compared with 9.5% in the comparative period.
Finally, we have Region Asia Pacific. The total growth for the region was minus 25.3%, organic growth accounted for minus 14%, while currency had a negative impact of 11.3%. The decline in organic growth was mainly attributable to Bufab Singapore due to lower demand from some large customers and also termination of an unprofitable customer in that company. Bufab Shanghai saw a small decline due to a very strong comparable quarter in Q1 2025. The gross margin also improved in Asia Pacific by 3.4 percentage points. This was driven by our active work with value-based pricing together with purchasing savings in the region. The cost level was somewhat higher, primarily as a result of lower volumes and currency effects. Overall, this resulted in improvement in adjusted operating margin, reaching 16.6% compared to 16.1% in the comparative quarter.
Before we sum up the quarter, I will take us through some highlights in the market. And I will talk about the Middle East conflict, trade barriers and also how we deal with that. While we had a strong start of the year, we have seen developments in Iran and the Middle East have increased the uncertainty in the market. On top of that, we have trade policies around us impacting us and our customers. If we start to say a few words about the conflict in Middle East, we have so far seen limited impact for our customers due to the conflict in terms of demand. Of course, a situation like this creates uncertainty in the market, but the only direct impact we've seen so far is higher cost level on air freight, which has a very limited impact on us as we use mainly sea freight.
When it comes to trade barriers like tariffs in U.S., CBAM in Europe, we act proactively to mitigate any impact for our customers and for Bufab. We have clearly seen in the last couple of years that turbulent times often create opportunities for a player like Bufab to take actually market share as customers increase their focus on securing their supply chains and that uncertainty drives consolidation that benefits us as we can help out in turbulent times to minimize impact for our customers. I think it's also very clear that our decentralized operating model makes us fast and flexible and help us to support our customers in the best possible way when we have turbulent times. So all in all, I think we act proactively and are well positioned to grab market share in an uncertain market.
Finally then, if we take and sum up the quarter. I'm overall pleased with our performance in the quarter. We delivered organic growth, clear improvements in both gross and operating margin, reaching all-time high levels despite a continued cautious market. Over the past 11 quarters, we have seen strong momentum in our gross margin, and we expect this positive trend to continue throughout 2026. But the market continued to be cautious overall. We see big deviations between segments and industries.
While we have seen a strong start to the year, conflicts in Middle East has increased uncertainty in the market, which, of course, could impact the demand if this continues. But as I mentioned in the previous slide, also open up opportunities for market share growth. Going forward, we will continue to focus on things within our control, and that is, of course, to gain market share, gradually improving our margins with a focus on gross margin improvement, delivering a strong cash flow. I think if we continue doing this in a proper way, we will be very good position when the market demand turns back. We see clearly that our strategy pays off. And despite the uncertainty in the market, we remain optimistic about the future and believe that we are in a very strong position for the future.
That was my final slide. I will now leave the room open for Q&A. Welcome to this Q&A session.
[Operator Instructions] So we start with the first question from Jonny Jin.
2. Question Answer
I have a couple of questions. I will start with segment West, I think, which sees an acceleration in organic growth, which is good. But could you please elaborate a little bit more what is driving that? Can we assume that previously announced customer wins have a full effect already now? Or is that still ramping? That's my first question.
Yes. Jonny, thanks for your question. Yes, we see good development in several sisters in the West. As I mentioned here, we have a good development in Spain, Czech, also in France. And we're actually doing a good job in grabbing market share. And when it comes to your second question here about this big contract that we secured last year, we have not seen the full effect of that yet. That is to gradually come in, in the following quarters. We have seen some impact, but more to come in the coming quarters.
Okay. That's fair. So maybe Q2 and onwards, we'll see more effect on the contracts. Is that fair?
Yes, that's fair.
Good. Then I want to move to Region Americas a little bit. I mean gross margin continued to be very strong, which is impressive. And I think it's up even compared to Q4. So maybe could you elaborate what is driving that? Is there any artificial timing boost or similar that we need to be aware of affecting the gross margin in Americas, because a lot of moving parts with divestments and structural changes, but also the timing of certain effects. Could you elaborate that, please?
Yes. As I mentioned also previously, we have seen very good development in our sister company, CSG, that is more or less a turnaround case. They had struggled with low profitability for some time. And the new management have done a good job in the last couple of quarters to change the way of working and also changing the profiles of customers and we are working with.
On top of that, we also divested BGM that was the manufacturing part of CSG. So that is one explanation why we see big improvement in performance in the region. On top of that, ABS has done a good job in working with both market share, but also on the pricing within their operations and also positively contributed to the gross margin. But there are some extra boost right now. So we expect some decline on gross margin going forward, but still be on a high level. So good work done, but maybe a little bit extra boost now in this quarter, but will remain on a high level also going forward.
That's fair. Could you quantify, please, the boost effect, the timing effect in this quarter?
No, I can't. We will not give any more details around that.
Okay. Fair enough. I need to try at least. But then I want to ask another one. I mean your comment there around slightly lower gross margin in Americas going forward, I think that's understandable because you previously mentioned that the boost from the tariff, I think that was coming into the comparables here in Q2 also. So I think last year, you said that roughly half of the gross margin improvement year-on-year stem from temporary effects. I think that's roughly 2.5 percentage points in that area. Is that sort of the magnitude we can expect decrease going forward? Or -- is that fair?
No, I don't think you should really take that conclusion fully, because we also have a big impact on the CSG operation that was not in that equation that much. That was mainly due to the situation in ABS. So you can't fully take that conclusion, because we also have a big impact on CSG's performance.
Okay. Yes, that's clear. Then just one final from my side. I think Fastenal had mentioned some timing lag in price increases actions to keep up with input cost and tariffs and such. Is that something that you have seen as well or...
No, not really. We have, I think, acted quite quickly on that. So if you mean there would be any lagging effect, so no, not really.
Henric Hintze, welcome to ask your question.
This is Henric at ABG. I just wanted to ask a bit on Region Asia Pacific. So like you mentioned, sales down here quite a lot, and it's been a bit volatile maybe on volume. Could you give us any sort of indication on what a normal level to expect here is and what is driving this?
Yes. The reason why we see this volatile numbers in the quarter is mainly driven then to Bufab Singapore. And that is driven by some customers that show lower demand in this quarter versus last year. And then on top of that, we have decided to step out from some unprofitable business that impact negative in the quarter. Having said that, I think looking forward, we continue to see a strong momentum in the other sisters in the region. So those big variations, we don't expect to see in the coming quarter as we saw in this quarter. So less volatile is expected going forward.
Okay. But is this Q1 level sort of a reasonable level to expect?
We don't know exactly what will happen in the terms of demand in the coming quarters. There's still a lot of uncertainty in that region, also driven by the situation in Middle East impacting some of the sisters. So it's very difficult to predict and give guidelines on how the demand will continue in the coming quarters. So I avoid that.
Okay, sure. And just on the overall organic growth in the group we're seeing in the quarter here. I mean, you have been talking quite a bit about taking new customers in a weak market over the past year or so. Can you give us any indication of how much is market recovery, or if there is any market recovery in the organic growth figure versus you taking new customers?
We see mainly volume effect in the improvement, and that is driven by mainly good work with market share in some sisters that we think are the main contributor to the organic growth in the quarter. The general market continues to be on a quite cautious level, I would say. As I mentioned in the intro session, the trend continues with really strong demand in some segments and others continue to be on a weak level. So the organic growth is mainly driven by volume and good work on market share.
Yes. Okay. And maybe just finally on the gross margin potential here as well. So you mentioned you expect it to keep seeing a positive development throughout this year. Just sort of with the work you're doing internally and the plans you have in place, is there any reason to expect that, that work will be largely concluded this year or that there is further potential beyond that?
I think what defines our gross margin development is how well we are actually giving value to our customers and lower their total cost and give them value creation. So if Bufab continues to do a good job here, also that should be paying off in the gross margin. But how that will develop, time will tell, but our work here in the different systems to do our best to gradually improve our customers' performance and lower the cost for us then to gradually improve our gross margin. So time will tell how good we're doing this and how much value we create.
Zino Engdalen, welcome to ask your question.
Zino from Handelsbanken. I'd just like to start off on a follow-up to Jonny's question on organic growth in Region West, if it's possible to give any idea around how much of the organic growth that is coming from these previously announced customer orders?
No, we don't disclose any exact number how much is new orders and how much is the rest. So unfortunately, not.
Well, I also needed to try. Going to the comments you made around the freight costs, it sounds like it should have a relatively -- or it sounds like you want to convey the message that it should have a relatively limited impact while you also highlighted that there were cost savings from that in U.K. and Ireland. Is that, so to say, fair to say that the freight cost risk is relatively low?
Yes. I would say that there are 2 different things. If you take the situation in the Middle East that's impacting the supply, here, we see limited impact. And the only impact we've seen on freight then is on air. And luckily, we have a quite small limited air freight in our business. The other part was the lower freight cost in U.K. and Ireland, and that is actually linked to the high freight cost that we had in the comparative quarter in 2025 that was actually standing out. So now we can say we have normalized the level on freight in U.K. and Ireland. So there are 2 separate topics there actually. But all in all, we have seen limited impact on freight for us and our customers. And the main thing we have seen due to the conflict situation is actually on air freight.
Very clear. And I'd also like to follow up on the other big customer projects you announced with Babcock, if there are any. Anything you can disclose there regarding the progress of that contract and how the expectations are for the ramp-up there?
We are doing well with that account. We are continuing building up the support structure for the customer, and we will see gradually positive impact on our net sales with this customer in the coming quarters and years to come. And how fast and how quick it goes, that's always difficult to say in those type of accounts, because it takes two to tango, us and the customer, and also a little bit how they should look at their production. But good start with the implementation phase, and we expect to see gradually positive impact on our net sales for that region.
Very clear. And just lastly, on capital allocation, given that you highlighted the net debt, that you have a continued appetite for M&A, if there's anything you want to share with regards to platforms or add-ons, or if it's more opportunistic, so to say?
No. We're looking at both. In our strategy, we are looking at 2 types, you can say, of acquisitions. We look both at platform acquisitions where we enter a new market or segment, that could be both within trading and niche, and that is bigger players then. And secondly, we're looking at add-on acquisitions where we add on a company that want to contribute into a certain sister somewhere in the world. So we are looking at both and have both type of companies in our pipeline.
Okay. Since there are no more questions, I would like to thank you all for attending this meeting and wish you a nice day ahead. Thank you.
Bufab — Q1 2026 Earnings Call
Bufab — Q4 2025 Earnings Call
1. Management Discussion
Good morning, and good afternoon, everyone, and a warm welcome to Bufab's Q4 report. My name is Erik Lunden, and I am President and CEO of Bufab Group. And together with me here to present the quarter, I have Helena Hager, Acting CFO. This presentation will be recorded and by attending to the meeting, you agree to the recording.
I will start to take us through the full year of 2025 and some highlights from Q4. And then I'll leave the word over to Helena for some financial details before I go through each of the regions. And then at the end, we will have time for Q&A. If we then start with 2025, it was another record year for Bufab -- results despite a weak market. We had a total growth of 0.5% in the year, where the organic growth was 0.3%. It was a record high gross margin at 31.9%, and the adjusted operating margin ended up at 13.3% for the year.
The Board proposed a dividend of SEK 1.3 per share for the year. We continue to have a strong execution of our strategy. We have added more and more value-added services to our customers. We have some technical issues, so we need to wait for a minute. [Technical Difficulty] Okay. We try again, sorry for the technical issues. We start to recap the full year 2025, and it was another successful year for Bufab.
We ended up with record high results despite a quite weak market out there. Our total growth in the year was 0.5%, whereas the organic growth was positive 0.3%. We delivered a record high gross margin at 31.9%, and our adjusted operating margin ended up at 13.3%. The Board proposed a dividend of SEK 1.3 per share for the year. What I'm very pleased with is that we continue to execute very well on our strategy. We have more value-added services to our customers and also improving how we work with value-based pricing.
From a sustainability point of view, we also had a good 2025. We launched new offering to our customers, and we got recognition from EcoVadis with Platinum rating in 2025. I'm also very pleased how we work with the customer and product mix, and we secured very interesting projects during 2025 in key segments like defense, infrastructure and in general industry. We also acquired the novia Group in Q4, and we also divested a small manufacturing part of CSG in U.S. during the year. And all in all, I'm pleased with the performance. We have strong momentum and put ourselves in a good position to deliver our profitability target for 2026.
If we then jump into the highlights of the quarter. Q4 was a strong end to a successful year for Bufab, and I'm overall pleased with our performance. We continue to focus on things within our control, and most of our systems out there delivered very strong results in the quarter. The organic growth was slightly positive, 0.3%, and the modest growth reflects the continued uncertainty we see in the market with big variation between countries and the customer segments.
Demand was strong in energy, agriculture and food, digital infrastructure and defense, while the mobile home trailer market was stable and construction, furniture, interior design and automotive industry remained weak. We delivered a very strong gross margin, 33.8% versus 29.3% last year, and the adjusted operating margin improved to 13.1% compared to 11.8%. The underlying cost level was unchanged compared to last year if we then adjust for novia and the acquisition of VITAL. And we continue to maintain strong focus on cost control, while we, of course, continue to invest in growth in cases where it makes sense. And all regions, except U.K., Ireland, delivered strong results in the quarter.
I will then leave the word over to Helena for some financial details. Please, Helena.
Thank you, Erik. Let's review the financial highlights, starting with net sales. Net sales for the quarter increased by 3.7%, resulting in a total of SEK 1.931 billion. We see a positive increase of 0.3% in organic growth. However, this growth varies across the regions, showing positive results in Europe West and the Americas, while in contrast, the Asia Pacific, Northeast and U.K., Ireland experienced negative organic growth. And that is, as Erik said, reflecting a continued uncertain market, but is also partly explained by 2 larger project sales in Q4 in previous year affecting this one.
The change in net sales is also influenced by a negative currency impact of 6.6%, and that is the strengthening of the Swedish krona that is -- that has led to this revaluation effect. And additionally, we have the acquisition of novia Group and VITAL that contributed 10% to the net sales increase.
Moving forward to the margin. We are pleased to see a significant improvement in our gross margin as well as a high operating margin in the quarter. The gross margin for the quarter was 33.8%, representing an increase from 29.7% in the same period last year. Additionally, gross margins improved across all regions. And the improvement is driven by several different factors. It's driven by savings in purchase, active work with improved customer and product mix and also price adjustments and currency.
The strong gross margin has been a key factor in achieving this high operating margin, which has resulted in an adjusted EBITA margin of 13.1%. And as Erik mentioned before, the underlying cost level was in line with previous year when adjusting for a novia Group and VITAL. We also had some favorable impacts related to currency affecting the cost, while acquisition costs had a negative effect compared to last year. And as we said previously, we continue to maintain a focus on cost control throughout the organization, while we also invest in companies and projects that will help us to grow for the future.
The cash flow. From the operating activities amounted to SEK 224 million, corresponding to a cash conversion of 93%. The cash flow from operating activities in the quarter was higher than in the comparable period, explained by improved earnings combined with improved working capital. The increase in inventory was smaller than in the comparable period. And on a full year basis, we can see that the inventory levels in the companies have normalized after the pandemic years.
So the working capital in relation to net sales amounted to 38%, which is then mainly due to reduced capital tied up in inventory. Finally, the net debt-to-EBITDA ratio is up after the acquisition of novia, landing on 2.6 -- maybe you remember, but in our last call in October, we communicated an expected net debt of 2.7 by the end of '25. After the novia acquisition in late October, net debt was 3.0 and positive to see by quarter end, it is now improved to 2.6.
That was all from the financial highlights.
Thanks, Helena. I will then continue and give you some details from the different regions. And I would like to start with the region, Europe, North and East. The total growth was minus 4.6% in the region and organic growth was negative 1.8%. Demand in the furniture and kitchen sector, where HT Bendix in Denmark operates remained low, while demand in defense, digital infrastructure was strong. Gross margin was very strong for the region, up 4.3 percentage points, driven by active work to improve our customer and product mix, price adjustments and consolidation of purchase volumes and also positive currency effect on the gross margin.
Operating expenses was up versus last year, mainly due to one-off related to workforce restructuring, but also inflation pressure. And the adjusted operating margin improved to 12.9% compared to 10.5% last year. If we then continue with Europe West, the total growth was 39.2%, of which 40.4% was acquisition and 3.9% was organic growth. We saw good demand in general in energy and defense, while automotive and construction industries continued on low activity levels.
The gross margin was up 6 percentage points, driven by price adjustments and increased added value services on new projects and also novia contributed positively on the gross margin. Adjusted for VITAL and the novia Group, share of OpEx was lower than the previous year, and we ended up on a very strong operating margin of 16.2%. Novia Group actually had a negative impact on the operating margin for the region due to the full year bonus provisions and currency effects booked in Q4, but novia expect to have a positive impact on the region during 2026.
If we then continue with Americas, they showed total growth of minus 4.1% and organic growth was positive 9.1%, mainly driven by price increases. Demand was stable, but on a low level for the mobile home and trailer market and lower demand was also noted in the automotive industry for CSG. The gross margin was up 8.4 percentage points driven by price adjustments, the divestments in CSG -- part of CSG and also reclassification of obsolescence reserves.
Some explanation here. The gross profit in Americas has been influenced by reclassifications of obsolescence, which involves relocating costs between GP and OpEx. These adjustments in onetime gave a positive effect on the gross profit for the quarter, alongside a partially offsetting negative effect on OpEx. And additionally, obsolescence costs have risen over the year, primarily in Q4 due to enhanced compliance with our reporting guidelines.
So if you adjust for this, we still have a very positive development in the gross margin and up on around 37% for the quarter. We also saw higher operating expenses mainly due to increased obsolescence reserves for Americas and end up on a positive development for operating margin and end up at 11.3%. And I can also mention that we have previous quarter had some positive impact on the gross profit due to tariffs on nontariff goods in the inventory, and that didn't have any impact in the Q4.
If we then continue with U.K., Ireland, total growth amounted to negative 12.5%, of which the organic growth was minus 2.4%. We saw low demand in the manufacturing industry impacted Bufab U.K., combined with lower market prices, which impacts APEX and their stainless business. Gross margin was up as well, 3.0 percentage points, mainly driven by sourcing savings and lower freight charges. We saw higher cost level due to inflation from higher social tax and national minimum wage in U.K.
The adjusted operating margin ended up at 8.1% compared to 9.0% in Q4 last year.
And then finally, Asia Pacific, the total growth for the region amounted to minus 22.4%, of which currency was 12.7% and organic growth was negative 9.7%. Bufab Shanghai delivered strong numbers and Bufab India noted minor negative growth and Bufab Singapore had a larger decline due to a larger onetime project sales in Q4 last year, as also Helena mentioned. Gross margin was up 2.3 percentage points due to purchasing savings and active work with our value-based pricing.
We also saw a higher share of OpEx in the region, primarily due to lower volumes and a smaller currency impact. The adjusted operating margin improved to 14.7%. Before we sum up the quarter, I would like to share a group news. And at this time, I will highlight one of the customer deals that we closed in 2025, and that is a major project with a world-leading supplier in the semiconductor industry.
We signed this contract in 2025 after long discussions with one of the world-leading manufacturer to semiconductor industry. And it is mainly BUMAX products that we'll deliver, but also C-Parts through FLOS. And it is tailor-made solutions that is part of this package to the customer. In this type of deal, we deliver typical peace of mind and clear value to our customers through cost savings, short lead times, quality control, et cetera, so full scope support for the customer. And this is a high-volume project that we started in Q4 this year -- sorry, last year. And we predict this project to ramp up during 2026 and 2027.
And why is this type of deal good for Bufab in the future? First of all, this is in an industry where we aim to grow, where we see long-term growth potential. We can also utilize our strength as a group with our broad offering and our capability to give tailor-made solutions for our customers and give the right services and solutions that they need. We deliver clear value for the customer, and this is a win-win. If we perform well, we will also deliver strong growth and also higher margins and much higher than the average margin that we have in Bufab.
And our aim is to create a long-term partnership and a win-win situation for the customer and for Bufab, of course. If we then finally sum up the quarter and talk a few words about priorities and outlook. First of all, I would like to say that I'm overall very pleased with our performance in 2025. We continue to focus on things within our control and execute our strategy very well and have delivered a record high gross margin and operating margin for the year. I'm also pleased that we delivered a strong Q4 despite quite weak market still out there. And over the past 10 quarters now, we have gradually strengthened our gross margin, and we expect the gross margin to continue to have a positive development also during 2026.
Despite the uncertain market conditions, we are optimistic about the future. We continue to focus on things in our control and give value to our customers and of course, continue to try to grab market share in a market that is actually good for market share growth. Continue to focus on improving our margin with focus on improving our gross margin, but of course, also be cautious with costs. And finally, continue working with our net working capital and secure a strong cash flow also in 2026.
And to sum up, I think we have a good momentum right now and put ourselves in a good position to also deliver on our profitability target for 2026.
That was my final slide. So I will now open up for Q&A.
[Operator Instructions] We start with the first question from Jonny Jin.
2. Question Answer
A couple of questions from me. I think I will start with North America. I mean, obviously, a very strong gross margin here in the quarter, and we touched upon that a little bit. But could you maybe break down the effect from the reclassification of obsolescence reserves here in the quarter and general underlying improvements and the effect from the divestment. If you could break down the drivers a little bit closer.
Yes. So I will not share all the details, but we have -- if we adjust then for obsolescence, we have an improvement in the quarter, ending up around 37% on gross margin compared to 33% last year. And that is driven by the improvement in CSG when we divested the manufacturing part of CSG, that is improving our overall profitability situation with a better customer product mix. And on top of that, ABS and also CSG is working well with their pricing management that is contributing. So we're going from a level around 33% to 37% if adjust then from the obsolescence that gave us a boost in the quarter. That is a little bit of what I can say about the gross margin in the Americas.
Yes. Okay. So it sounds interesting, majority structurally, obviously then. On demand, a quick question there. I think book-to-bill is back above 1 here in the quarter, which is good. So how should we think about demand going forward, would you say? And what sort of visibility do you have in new customer contracts getting on board as you take market share? Or what is your gut feeling there?
Yes. What I can say is that there's still uncertainty in the market. So it's very difficult to predict how the demand will turn out now in 2026. But if you look at things that we can control, I'm pleased with the performance in '25 in terms of market share gains and also secure some big projects that we know that will help us and support our growth levels in 2026 and 2027. That is sure. And then if we get some tailwind from the overall market, that is in the crystal ball, so to say, but I'm optimistic we put ourselves in a good position to, I would say, harvest when the market bounce back. But we still see many industries and segments with quite low demand and not picked up yet. So we continue to put ourselves in a good position to hopefully be -- get some leverage from that when the market bounces back.
Yes. Understood. But can you say something about how big the new contract with the leading manufacturer of semiconductor equipment is in the -- is for you. And also, I think you highlighted Babcock contract and the size of that last quarter. Is that any effect on that already now? Or when will that show in numbers?
Yes, both those projects are, for us, significant volumes and that will contribute on gradually on top line and right away on the gross margin because it's a high-value services that we provide to those customers. And they will have gradually positive impact on the net sales and also margin in 2026. We will not be able to disclose any details about the numbers, but more that will gradually help us during '26 from top line and also margin point of view.
Understood. One final quick one. I think gross margin in U.K. is also very strong and did quite a big jump here in the quarter year-over-year. So was there anything particular that drove that? Or how should we view the U.K. going forward here?
No. As I mentioned in the call, I'm overall very pleased with our gross margin improvement during 2025. All regions are contributing and also systems in the regions are more or less all of them are doing a good job to improve their situation from a gross margin point of view. And that is paying off step by step. And here, U.K. is no exception. There challenges is the market situation in U.K. in general, but also, of course, also situation for stainless with tough prices out in the market. But from a gross margin point of view, they, alongside with the rest of the organization is doing a good job, I think, and gradually improve the situation. So that I'm pleased with.
Gustav Berneblad, welcome to ask your question.
It's Gustav here from Nordea. Just to start off here, maybe in Europe West. I mean, a very strong margin. And it would be interesting to hear just what do you see there in terms of temporary effects here impacting the margin positively. I mean if we look at Q4 in recent year, it has not really been the seasonally strong quarter, so to say. So it will be very interesting to hear.
Yes. No. West have a good, as you said, development in Q4. I think a little bit, as I mentioned when Jonny asked his question about the gross margin, more or less all companies in the region West are performing well from a gross margin perspective and are good in improving their customer product mix and also adding value services with higher margins to our customers. And on top of that, there are projects like this supply to semiconductor industry that is starting to give results as well. So all in all, they do a good job and improving the situation. So -- and then also in Q4, they had a positive customer product mix as well that contributed positively. So I would say it's -- the main driver is the good work they have done for quite some quarters now is paying off, but also a favorable mix in the quarter.
And in regards to your commentary in the report as well, I mean, you say that the novia Group has a negative impact on the margin as well. Is it possible to give any indication of that.
Yes, that's true. I mean they give a positive impact on the gross margin, but a negative impact on the operating margin in the quarter. And that is because the way they have done the reclassifications, the previous owners will take a lot of the reservations and costs for bonuses and currency and others in Q4 impacting the operating margin negatively.
Having said that, with our way of reporting and putting reservations in place, we expect novia to contribute positively to the region West from an operating margin point of view starting now in Q1 and continuing in 2026. So if you remove novia from the acquisition, the old West, so to say, are performing very well in the quarter and have a good momentum.
That's perfect. And then maybe on your comment here, it's not only in Americas, we are seeing price increases. It sounds like West as well. But on a group level, what would you say out of the 0.3% organic growth is driven by price versus volumes in the quarter here?
I would not share the details around that. I would say that it's a combination of factors that drives the improvement. One is the working with pricing management and the other that is very important as well is that we still continue to get sourcing savings and we keep them. And thirdly, we are, I would say, better in doing value-add services that we are increasing every time. So we give our customers a broader range of support that generates higher margin. And we have, as we have mentioned before, also secured deals that is contributing positively.
I mentioned this deal here in the semiconductor industry that, for example, is helping West in Q4 and will continue helping them also in 2026. So the new deals that we are adding to net sales is contributing positively as well. So it's a combination of factor that is helping us on the margin side. And yes.
Yes. And sorry, one last one, very quick one. Are you still seeing -- or are you seeing any change here to the situation regarding the buyers' market in China. Or is that still supporting you?
It's still supporting us.
[ Mattis ], please ask your question.
A question on ForEx impact on profitability. Could you be able to quantify the impact on gross margin and operating margin coming from ForEx?
No, we don't disclose any details on the ForEx on gross margin and on net sales. We don't do that. We have -- as you can see, we have some countries, as I mentioned, in some regions, we have positive effect driving like we mentioned in Northeast, for example, that is contributing positively and others is the other effect. So it's a mixed bag, and we don't disclose more details than we have mentioned here in the different -- for different regions.
Since there are no further questions, I hand over to Erik to close the meeting.
Yes. Thanks, everyone, for joining. I wish you all a nice day ahead. Thank you.
Bufab — Q3 2025 Earnings Call
1. Management Discussion
Hi, everyone, and a warm welcome to Bufab's Q3 report. My name is Erik Lunden, and I'm President and CEO of Bufab Group. And together with me here, I have Helena Hager, acting CFO. This presentation will be recorded and by attending to the meeting, you agree to the recording. I will start this meeting to go through our Q3 highlights, and then I will give the word over to Helena to take us through some financial details. After that, I will go through some regional highlights and some group news before we end up the meeting with sum up the quarter and Q&A.
So if we start then with some highlights of the quarter. Overall, I am very pleased with our performance in the quarter. We continue to execute very well on our strategy, and it continues to give results. Something that was very positive to see that was that we finally got some organic growth, 1.4%, first time in 2 years, primarily driven by increased market shares. The market though contains uncertain with a big variation depending on geographical areas and customer segments. Demand was still strong in energy, agriculture and food, medical technology and defense, but weaker demand in mobile home, trailer market and also in construction and furniture. We end up to have a very nice gross margin in the quarter, record high on 32.7%, and we now have 8 consecutive quarters of gradually improved gross margin.
Our operating margin adjusted ended up at 14.2%, which actually is in line with our financial targets for 2026. If we look then on our cost base, the underlying cost base was changed in the quarter compared to Q3 last year to adjust for one-offs. And I think we are good in managing our cost base overall, and we continue to invest in growth at the same time as we take good cost control throughout the organization. Something that was very nice to see in the quarter was some new customer projects across key segments like defense, infrastructure and general industry. And I'll come back to that. I'm also very pleased that we managed to finalize the acquisition of novia Group in early October, and I have also one slide on that later on. I will now leave the word over to Helena for some financial highlights. Please, Helena.
Thank you, Erik. So let's look into the financial highlights, starting with the net sales. We can begin by noting a 2% increase in net sales in the quarter, bringing the total to SEK 1.917 billion. Even more notable is that we can see a positive increase of 1.4% in organic growth, as Erik mentioned earlier. And that is driven by our increased market share and also the impact of higher prices resulting from U.S. tariffs. The organic growth is also being driven by all regions with the exception of Ireland and U.K., which is, of course, positive and with the Americas making the most contribution.
The change in net sales is also influenced by a negative currency impact of 4.4%, and it's coming from the strengthening of the Swedish krona against most currencies, but especially the U.S. dollar, and that has then led to a revaluation effect. And also the increase in net sales is explained by the acquisition of Vital, which has then contributed with 5%. Let's move on to the margin. As Erik also said, we are pleased to see a significant improvement in our gross margin as well as a record high operating margin in the quarter. The gross margin for the quarter reached 32.7% and an improvement from 30.6% in the previous period. And we are also pleased to notice that the gross margin increases across all the regions.
The gross margin is then, of course, contributing very nicely to our record high operating margin, giving us an adjusted EBITA margin of 14.2%. When looking -- moving on and looking at our operating expenses, we can see that the cost level is consistent with last year when we do the adjustment for one-off items. The primary one-off items include capital gain from the divestment of Lann and Halborn last year and also cost from divestment within Component Solutions Group in U.S., and that happened this year. Then we also have an effect of the operating expenses in Vital is also explaining the difference. And additionally, we had a revaluation of earn-out in the third quarter last year. And also worth mentioning on the positive side is that we have a benefit from a favorable currency effect. But we also continue to focus on cost control while investing some of the savings into growth initiatives.
Our primary focus, I would say, is investing in people and our facilities to support and also drive the growth further on into the future. And the cash flow from the operating activities amounted to SEK 293 million, corresponding to a cash conversion of 108%. And the cash flow from operating activities was slightly lower than last year quarter, mainly due to the reduction in inventories not being as significant as in the comparable period. So the inventory levels subsidiaries have normalized, you can say, after the pandemic years. And we also see some inventory buildup taking place during the year, and that is mainly in order to improve the service level to customers, but also we see a buildup of inventory for new businesses that will come next year.
And then finally, the net debt against EBITDA ratio has shown a positive trend this quarter, decreasing to 2.3% or 2.3%, sorry. And in current month, we anticipate an increase in net debt to 3.0 due to the acquisition of novia. However, our estimates indicate that we will continue to improve this ratio, and we expect the net debt to reach approximately 2.7% by the end of Q4. Thank you. Over to you, Erik.
Thanks, Helena. I will then take you through the regional highlights, and I will start with the Region North and East. The total growth in the region was minus 2.1% and organic growth was positive 0.5%. We saw strong development in BU East and also in Bufab Finland and stable demand in general industry, while furniture and kitchen, for example, academic Denmark and the energy sector in Nordic remained weak. Gross margin was strong, up by 3.9 percentage points, driven by improved value sales, customer product mix and consolidation of purchasing savings. In addition, currency effects had a positive impact on the gross margin.
Operating expenses increased SEK 27 million compared to last year, but the difference was mainly explained by revaluation of earn-out and one-off effects in connection with divestment of Bufab Lann Hallborn, but also negative currency effect and inflation. Adjusted operating margin improved to 14.6% compared to 14.2% last year for the region. If we then continue with the Region Europe West. Here, the total growth was 20.5%, linked to the acquisition of Vital and the organic growth was positive 1.7%. We continue to see very strong development in the Bufab Czech, also followed by Bufab Spain, driven by market share. Demand in energy, defense, infrastructure continue to be strong in the region, while automotive and construction continue to be on low levels. Also here, the gross margin was up 0.3 points, driven by price adjustments.
Operating expenses increased by SEK 18 million year-on-year, mainly related to Vital, but also investments in some customer cases linked to growth in the coming years. Adjusted operating margin ended up at 12.7% for Region West. If we then continue with the Americas, the total growth amounted to 3.6% and organic growth was 12.6%, driven by tariff revenue. The demand was stable in Americas on a quite low level for mobile homes, but also for the automotive industry for CST. We divested a small manufacturing unit within CST in the quarter, and that expects to continue to have a positive effect for the profitability for Region Americas in the coming quarters. Our gross margin increased 6.2%, driven by improved customer product mix, general price adjustments, but also the effects of tariff. If we estimate the short-term effect of tariff is estimated to be half of the gross profit level in the region. Even despite support from the tariffs, we see very strong development in Americas on a gross margin point of view.
Operating expenses increased by SEK 1 million year-on-year, but adjusted for divestment within the CST group, the operating expenses decreased for the region. And all in all, the operating margin improved to a strong number of 22.2% versus 12.5% last year. If we then continue with U.K. Ireland and U.K. Ireland is the region that now are challenging the toughest market conditions, I would say. The growth amounted to minus 9.6% and organic growth was negative 4.1%. In the region, we see continued low demand in the manufacturing and general industry, impacting both Apex and Bufab U.K. For Apex, that are operating within stainless is still very low prices in the market and that impacts their performance. TIMCO holding up volumes and profitability well in a very challenging market. Gross margin increased by 0.2%, mainly driven by sourcing savings for the region. The operating expenses for the region was in line with last year, and the adjusted operating margin was 10.7%.
Then finally, we have Asia Pacific. Here, we had a total growth of minus 7.4%, but a positive organic growth of 1.3%. Shanghai and India continue to show strong organic growth in areas such as electronics, marine, rail and energy. Gross margin improved for the region by 0.8% due to purchasing savings and also good work with value-based pricing in the region. The operating expenses decreased by SEK 7 million year-on-year, primarily driven by positive currency effects. The adjusted operating margin then improved significantly to 14.3% for the region. I will then take us through some group news that happened in the quarter, but also in October. And I will start with the great news about the acquisition of novia Group that we see as a very important strategic platform within the Bufab Group going forward. novia Group is a German expert provider of global sourcing solutions, and it fits very well with our strategy. The group has a turnover of EUR 50 million in 2024 and profitability significantly higher than Bufab's target for 2026. The operation in Germany and Switzerland with sales in Europe and U.S. and also assembly in China and Vietnam.
What novia do is that they provide customers with sourcing solutions, engineering expertise and assembly, which creates clear customer value and will be a good addition to our portfolio in terms of offering. They have an interesting profile in terms of markets and customers. They are strong in med tech, energy, sanitary and general industry, as example. And we're also pleased to see that Markus Bauer will continue as MD for novia Group also going forward and also be a minority shareholder in the group. And we managed to finalize the acquisition in mid of October. So it's now in our books. So why then novia Group? For me, this is in line with our strategy and fits perfectly well in our plan for the future. As I mentioned before, novia brings important new capabilities to Bufab through their engineering expertise, also how we work with assembly and technical services and a very interesting place in the value chain. It also expands our footprint in Germany and also in Western Europe with a strong and diverse customer base, where I think it could be a win-win both for novia's growth going forward, but also for the Bufab Group.
It also will have a positive impact on our profitability in the group, novia at a run rate on significantly higher operating margin than our 2026 target. And also, I see novia as a perfect platform for both organic growth within this field, but also add-on acquisitions to build a big player within this field going forward. So all in all, I'm very pleased that we now can welcome novia and the novia team to the Bufab Group. As I also mentioned in my intro, I'm pleased how we're working actively in the market and taking market shares in many regions. One example that took place now in the quarter was the framework agreement that we signed with Babcock that is one of the leading suppliers within defense, aerospace and security. We won a competitive framework agreement with competition with other C-parts suppliers in a very interesting growth area for us going forward, which is defense. A little bit short about Babcock. It's a big player within this field, has GBP 4.8 billion in turnover and a backlog of approximately GBP 10 million. And we think that they are perfect type of customers for our services. For Babcock, we have tailor-made logistics solutions that will be on site for them, and it's now up and running actually, but hopefully more to come in the coming quarters.
And as I mentioned, we believe that we can streamline and support Babcock on the procurement and efficiency overall, and that will be a win-win with this partnership. One important enabler for us is sustainability. In the deal with Babcock, but also with other customers, we see more and more, especially in Europe, that our strong position within sustainability is a key enabler for us to take market share. One strong recognition for our work with sustainability was that we got the Platinum EcoVadis rating in October. And for me, this is a positive signal and achievement that we are in the top end when it comes to sustainability within the C-Part industry. I will then finally sum up the quarter and say a few words about the outlook and our priorities going forward. First of all, I would like to highlight once again that I'm pleased in the way that we are delivering on our strategy. I think that our strategy gives clear value to our customers, and that is also paying off now in the organic growth, but of course, also in our gross margin and operating margin.
We delivered a record high gross margin and adjusted operating margin. Even if we then adjust for the tariffs in that helps us short-term U.S., we still have a record high gross margin and operating margin in the group. So I'm overall pleased how we work with that. We will continue to have a strong focus on cost control, but at the same time, invest in the key areas for growth. It could be customer cases, but also, of course, in infrastructure in sales to put us in a strong position while the market rebounds. Because the market is still tough out there, it's uncertainty in the market. But all in all, we are still positive about the future. We'll continue to focus on things within our control and put us in the best possible position when the market rebounds.
So to sum up, continue our work with our strategy, that is to continue to be active in the market and take market share. Of course, continue the gross margin journey that we are on. We still have much work to do here and continue to strengthen that margin, but also then be cost efficient overall in the organization to end up on a strong operating margin. And we continue to deliver a strong cash flow, focus on our net working capital and inventory. That was all for today. I will now leave the floor open for Q&A, please.
So welcome to this Q&A session.
[Operator Instructions]
We start with the first question from Jonny Jin. Please ask your question.
2. Question Answer
Can you hear me?
Yes.
Just a couple of questions from my side. I think I'll start with a quick one on the gross margin in America. I mean you mentioned already that roughly half of this strong gains stem from temporary effects from tariffs. I suppose it's roughly 3 percentage points. But can we expect the tariff effect to disappear completely already next quarter? Or could this effect remain a little bit ahead as well? That's my first question.
It can remain a little bit ahead as well. So that will be a gradual decline. And then as I mentioned, there are still a lot of other works ongoing to gradually improve also the gross margin in Americas. So it will be 2 factors here. One, decline due to the tariff effect, but also gradual improvement with the work the team is doing both in ABS and CSG.
Yes. Okay. That's more structural. So this temporary effect will gradually disappear coming quarters?
Correct.
Yes. Okay. That's clear. And then moving to Region West. Margin -- EBITA margin there is down 100 bps despite the inclusion of Vital and you also showcased organic growth in that region, so -- and higher gross profit. So could you just explain a little bit what happened there on the EBITA margin? And how should we view that going forward?
Yes. We have some higher operating margin -- sorry, operating expenses in the quarter for West. We have quite significant investments in growth actually in West that is impacting the numbers in the quarter, that will benefit positively for the region in 2026 and '27 that is impacting. And then, of course, there is -- for some companies, a little bit tougher situation in the market that's impacting the performance. But I would say that I'm all in all, not that concerned about the situation in the West. I think they have the cost level under control.
Okay. Understood. But was there any unusual high cost in that segment this quarter that is not -- should not be extrapolated or?
Yes, they will not be at the same level going forward.
Okay. Can we say something about the magnitude of those costs in the quarter?
No, not really, but no details, but some of them is investment in growth that will disappear, yes.
Yes. Okay. Then one on North and East Europe. I mean gross margin is also very strong in that region. Could you maybe elaborate more what is driving this? Is there any temporary FX effect that is fitting you with the strong or a weaker dollar? And -- or like how much is structural would you say? And how much is -- are there any temporary effects there?
The majority of the improvement is driven by the good work they're doing in the region with the customer product mix, sourcing savings so on, but they also have a positive currency effect for the region in the quarter. So it's both contributing, both good work, but also the currency effect.
Can we pinpoint the magnitude of the currency effect in this quarter from the margin?
The bigger effect is on the other areas, not on currency, but it...
Yes. And then one final on outlook and demand here. I mean you're now back on organic growth trajectory. And I also -- I mean, you recently press released the Babcock contract, and I feel like you have some momentum in the business now. And this contract, I suppose, is also a result of you having long discussions with customers before signing. So can we expect more of these type of contracts announced going forward? And can we expect this continued organic growth to continue here in Q4 onwards as well?
Yes. When it comes to our activity in the market and market share gains, I'm positive with the development in 2025. I think we have secured several important projects that will pay off in -- mainly in '26, '27 and onwards. With the new way we are working with our customers, where we do often tailor-made solutions comes to logistics solutions and so on. There is -- the good thing is that then you get a bigger part of the cake, but also that drives initially bigger investments to make it happen.
And we expect more of those to materialize in top line in '26, I would say, mainly. So that is positive. The market overall, I think, still remains on a cautious level. So I hope to see us delivering organic growth by being good in the market and to see some -- hopefully, these trends continue. That is what we're aiming for.
Yes. Interesting. We'll see. But just one final. I mean, I think you usually don't press release new customer contract wins like this one. So was there anything particular reason why you chose to press release this? Or could you say something about the size of this deal?
We don't talk about any numbers, but there are a couple of reasons why we did the press release. First of all, is the size of the deal and potential. The second is that we see defense as a very interesting focus area for us going forward, and we have secured interesting projects in this area in 2025. And thirdly is the way also that we provide service and solutions to our customers in a case like Babcock, where we do I would say, significantly helping the customers with efficiency and way of working and also cost -- total cost when it comes to C-parts. So there are a couple of factors why we choose to do this. And then of course, also that in this case, the customer also positive and willing to do this as well that impacts.
Yes. Okay. I understand. But is it fair to say 1% or 2% of sales and then it's beneficial for mix or it could be even more on?
I will not share any detailed number. I will say that it's a good framework that we have signed with a customer that consumes a lot of C-parts.
Henric Hintze, welcome to ask your question.
This is Henrik at ABG. So first, just one follow-up on the Americas thing. Can you give any guidance regarding how long it will take for the tariff boost effect to dissipate completely from the gross margin?
In the coming quarter, we estimate it to gradually decrease. So yes.
Yes. But will it still be there in Q1, Q2? Or will it be partially there in Q4 and then...
Then I need to have a crystal ball. I don't have it. So I can't share that how the market will develop exactly in Q4.
Sure. And on the organic growth in this quarter, you reported a slight organic growth now. I was just wondering if you could give any flavor on how much of the net positive impact here is from new customers year-on-year compared to how the market is developing?
We see the main reason for the organic growth is market share gain in different parts of the world. So that is which is the main driver for this positive number in the quarter.
Okay. That's interesting. And you have been speaking quite a lot about new customer contracts, not only this quarter, but over the past year or so. I was just wondering, do you expect at some point to see an acceleration in the contribution from market share gains? Can you sort of see that in your pipeline or anything like that?
If we sign contracts like Babcock and others that we have communicated, that will gradually give us a positive impact on the organic growth and market share gains. Then we don't guide on how much this will impact for the coming years more than that it will be a gradual positive impact. How it works is that you build up a foundation with, for example, solutions in place and then you gradually increase number of C-parts from those customers' accounts. So that is what we expect to happen.
And then on top of that is, of course, impacting the speed depending on the market situation and how quick the market rebounds in many areas where it's not that high activity as it was before, for example, with [indiscernible] and those that are quite low volumes. So no detailed guidance I will give you more than that, it will be gradually impacted postively.
But you think it's more reasonable to expect that new customers will gradually start contributing to organic growth rather than that we'll see a step change in growth rates at some point when a lot of contracts start?
Gradually improvement, I would say, that is the now it works in our industry. Even though that those type of contracts, of course, start on a higher level than maybe traditional sales that we had in the past, but still it's a gradual increase, as you can expect.
So since there are no further questions, I hand over to Erik to close the meeting.
Okay. So thanks, everyone, for joining today. I wish you all a nice day ahead. Thank you.
Bufab — Q3 2025 Earnings Call
Financial data from Bufab
Revenue
Revenue is the sum of all sales generated by a company, e.g. for its products or services.
Revenue (TTM) metric explainedDirect Costs
Direct costs are the costs incurred directly in connection with the manufacture of the product or service.
Gross Profit
Gross Profit indicates how much of the revenue remains in the company after deducting direct production costs. If the percentage share of sales is calculated, this is referred to as the gross margin.
Gross Profit metric explainedSelling and Administrative Expenses
Selling, general and administrative expenses (SG&A) include all expenses for marketing and sales as well as the general administration of the company.
Research and Development Expense
Research and development costs (R&D) provide information on how much the company invests in the research and development of its products. The costs are particularly interesting as a percentage of revenue and in comparison to direct competitors.
EBITDA
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is the company's earnings before interest, taxes, depreciation and amortization. The EBITDA margin is calculated as a percentage of sales.
Depreciation and Amortization
Depreciation represents reductions in the value of the company's assets (e.g. due to wear and tear on machinery).
EBIT (Operating Income)
EBIT (Earnings Before Interest and Taxes) is the company's profit before interest and taxes, also known as the operating income. The EBIT Margin is calculated as a percentage of sales at
.
Net Profit
Net Profit represents the profit or loss after deduction of all costs.
Net Profit metric explainedStocksGuide Premium
| Sep '26 |
+/-
%
|
||
| Revenue | 8,655 8,655 |
8%
8%
100%
|
|
| - Direct Costs | 5,753 5,753 |
4%
4%
66%
|
|
| Gross Profit | 2,902 2,902 |
17%
17%
34%
|
|
| - Selling and Administrative Expenses | 1,756 1,756 |
11%
11%
20%
|
|
| - Research and Development Expense | - - |
-
-
|
|
| EBITDA | 1,499 1,499 |
23%
23%
17%
|
|
| - Depreciation and Amortization | 325 325 |
9%
9%
4%
|
|
| EBIT (Operating Income) EBIT | 1,174 1,174 |
28%
28%
14%
|
|
| Net Profit | 777 777 |
33%
33%
9%
|
|
In millions SEK.
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Company Profile
Bufab AB engages in provision of supply chain solutions for sourcing, quality control, and logistics for C-parts. The company is headquartered in Varnamo, Jonkopings and currently employs 1,709 full-time employees. The company went IPO on 2014-02-21. The firm purchases, develops, manufactures and distributes components such as C-parts, standard fasteners, magnets, magnet systems, and other standard and drawing-specific parts in metal, plastic, rubber, stainless steel, metal powder, wire and fabric. The company serves a variety of industries, such as telecommunication, automotive, furniture, offshore, engineering, industrial construction, agriculture, aerospace and railway. The firm operates through subsidiaries in Sweden, Norway, Finland, France, Germany, China, Taiwan, Austria, Poland, the United Kingdom and the Netherlands, among others. Also, it operates Kian Soon Mechanical Components Pte Ltd in Singapore.
StocksGuide Premium
| Head office | Sweden |
| CEO | Mr. Lunden |
| Employees | 1,874 |
| Website | www.bufab.com |
