Inwido Stock

Hello, and welcome to today's webcast with Inwido, where President and CEO, Fredrik Meuller; and Peter Welin, CFO and Deputy CEO, will present the report for the second quarter of 2026. [Operator Instructions] And with that said, I hand over the word to you guys.

Thank you very much. Good morning, and welcome, everyone, to today's webcast covering Inwido's second quarter of 2026. My name is Fredrik Meuller. I'm the President and CEO of Inwido. And next to me here at our Malmo, Sweden, Inwido head office is Mr. Peter Welin, our Group CFO and Deputy CEO.

And this is today's schedule. We will start off with a couple of key group messages, followed by a deep dive into our business areas and our financials. Towards the end, we will wrap up with an outlook and the Q&A. And of course, as always, this material is also available on our website.

In the months of April through June, Inwido bounces back nicely from what was a challenging start to the year. Step by step, month by month, we improve our performance, resulting in our highest operating EBITA to date for the second quarter. And I think to raise profitability, to grow organically in both net sales and order intake and to make another two acquisitions in the period, I think that really underlines the fact that our model and our strategy work really, really well. Because let's not forget that our market generally remains far from normalized. The ongoing Middle East conflict is defacto a wet blanket, hampering both demand and supply.

So while fighting off raw material surcharges and trying to pass on these costs to consumers, customers via price increases, we are, of course, benefiting from higher volumes. We have seen more operational efficiencies in our factories, where we also leverage the investments that we've made before, and we retain still a very healthy cost control across the group. The record size project order for Sidey Solutions in Scotland, of course, boosted our order backlog, which is now at an all-time high. And I think importantly, worth noting is the Consumer order intake also grew by 3% in the quarter.

Our M&A activities continued to bear fruit. In Q2, we added another two companies to the other four we did recently this time in the U.K. and in Croatia, the latter being yet another new market for Inwido, making it 15 in total. Last but not least, cash flow was strong in the quarter, meaning gearing is at a good level, I think, 1.8x on a pro forma basis, providing us with a solid war chest for further acquisitions and investments.

And staying on that topic, as you are aware, in anticipation of organic growth bouncing back, we are actively and successfully pursuing acquisitions in both existing and new markets. And I'm very pleased with our development here, adding six fine companies across two new markets and with SEK 1.5 billion in additional top line, we -- without paying highly -- without paying too much in terms of multiples. I'm very pleased with that and glad that we are -- that our activities over the last 12 months are bearing fruit. And at the moment, though, we still see -- I mean, on the one hand, we see a healthy activity level across the markets that we're interested in, and we have a solid case pipeline as the industry consolidation continues to offer opportunities for us.

Still with the prevailing market uncertainty, valuation gets kind of tricky because basically, everyone has faced a very challenging Q1 this year and then a lot of the sellers are indicating some kind of hockey stick for the months to come, where we haven't seen the full impact of the Middle East conflict yet. So we are a little bit more selective than usual. And in the meantime, we, of course, also prioritize integration of the latest new family members that we have.

And let's look at one of them, namely Marlex in Northern Croatia, which is geographically also very close to our AJM business unit in Slovenia, i.e., this offers collaboration opportunities for these two BUs. Marlex is a very fine company, ticking all the relevant boxes for us, being #1 in its field, having a broad offering, a strong brand, proven track record, good profitability and offering very solid synergy potential. In short, I think it's an exciting new acquisition. And I want to welcome them to the Inwido family.

If we then go into the four business areas and we look at them in order of size, meaning we will start with Scandinavia. Well, it's a strong quarter by Mads and his team, building on the momentum that we saw towards the end of the first quarter, really improvements across the line with Denmark and Sweden standing out, helped by volume, making, as I said, the factory wheels spin a bit faster and where we can leverage previous investments. We haven't seen the full impact of this, but so far, so good, I would say.

We have been fighting hard to balance the raw material, energy, transport surcharges linked to the Middle East conflict, balancing that with pricing, account by account, where very few, if any, of our peers have been following us. This is far from over. We have yet to see the full impact of the Middle East conflict. At the same time, we have yet to see the full impact from our price increases. But what is clear is that we prioritize profitability here, meaning that we sometimes walk away from projects, bids, tenders where we see or feel that pricing is at a silly level.

I think it's great to see that operating EBIT margin -- EBITA margin is above 15%. This organic growth and a solid order book that now offers cautious optimism for the second half, but it really stands and falls with consumer behavior, which is still a bit subdued. We've had some negative FX translation effects from Danish krone to SEK, but at the same time, it was a bit positive from Norwegian krone. So net-net, not that much.

Then moving across the North Sea to BA West, which includes the U.K. and Ireland, as you will recall. A lot of positives also here for Jonna and her team. Strong top line growth, both organic and via new acquisitions, where we added Sovereign Group in the second quarter, another really nice company, fine acquisition. In absolute terms, we have a higher profit here, although the mix has been somewhat against us, taking down the margin a little bit. The icing on the cake, of course, in the quarter is Sidey Solutions' GBP 50 million order, Inwido's largest to date, which provides a really nice base load for the factory up in Scotland over the coming 5 years and where manufacturing and invoicing started now this month, in month of July.

England offers a tough market still. There's lots of consolidation going on and lots of price pressure, particularly in the Consumer segment. There's a lot of political turmoil, as you all will have seen and read about with a new Prime Minister at some stage coming into office. And I think a win tonight and a win then in the final in the World Cup would be a huge boost for the entire nation. I'm particularly pleased with the collaboration and the synergy pursuit across the BU boundaries here. We have some nice critical mass in this part of Europe at the moment and some really nice companies working together, which bodes really well for the future.

Moving to BA East, which is now Finland, Poland, Slovenia and Croatia. All of the Croatia numbers are not in here yet. They will be consolidated on a P&L and balance sheet basis from the third quarter and onwards. Antti and his team are still fighting a bit of an uphill battle across the BA, primarily in Finland, where the main theme is lack of volume. There is immensely fierce competition and lots of price pressure still. Having said that, the cost alignment is rather impressive. And we are de facto still in the black with our figures, which I think is worth noting. So hats off to Antti and the team. We get a broader exposure now through the Marlex acquisition, meaning we also have less dependence on Finland, which I think is good. It mitigates our risk exposure a bit.

So to conclude this BA run-through, let's turn our focus on BA e-commerce, our online business, where Bo and his team continue on a very positive trajectory, again, raising profitability now actually for the fourth quarter in a row, making their margin trending up on a double-digit basis on a rolling 12-month basis, which I think is really impressive. And it's really a combination of pricing, increased efficiencies and cost downs, a lean mean machine that is doing really well.

As an anecdote, I visited the Copenhagen marketing office of this business recently. It's really a high-tech think tank, lots of exciting and promising AI stuff cooking in their kitchen, not only within marketing. And yes, it made me feel like a true dinosaur, but I had a great time there. So well done, guys.

Now for some more flavor on Inwido's consolidated Q2 financials, I will hand over to you, Peter, please.

Thank you so much, Fredrik. I'll start with this page. This page is showing the income statement. To the left, you can see the Q2, in the middle year-to-date and to the right, last 12 months as well as last year.

Starting with the quarter, sales is plus 16% compared to last year, organically plus 4%. We have a material price inflations in the quarter, but that has been compensated by growth efficiency as well as sales price increases. Thereby, the operating EBITDA margin is plus 0.1% units compared to last year and the operating EBITA is plus 0.2% compared to last year. For the first time ever, the operating EBITA in the second quarter is above SEK 300 million.

Between operating EBITA and EBITA, we have nonrecurring items of SEK 11 million, whereof SEK 8 million are acquisition costs. Profit after tax is plus 27% compared to last year, and the EPS is plus 26% compared to last year, ending up to SEK 3.40 per share.

Looking then at the year-to-date, we had -- the year started slower compared to last year with a slower performance in Q1. But then thanks to the organic growth of 4% in Q2, we have now an organic growth year-to-date of 1% compared to last year. The operating EBITDA margin as well as operating EBITA margin is below last year, but in SEK, is above last year. And not only the operating EBITA and also the EPS has been improved and is now above last year also on year-to-date.

Looking at the latest 12 months, the sales is now on SEK 9.5 billion. The operating EBITA is SEK 970 million, and the margin is 10.2%, and we have an EPS of SEK 9.11.

This page is showing the development in sales as well as operating EBITA compared to last year for Q2 divided between the business areas. We have organic growth in Scandinavia and the West and e-commerce, whereas we still have decline in East. East and then mainly Finland is still challenging. But worth noting and also Fred noted, as said, that the result or the profit or operating EBITA for East is positive in the quarter as well as year-to-date.

In West, the consumer market in U.K. is still challenging, but nevertheless, West has improved the result by SEK 22 million compared to last year, and we have added two acquisitions in West when compared to last year, Victorian as well as Sovereign Group. And then e-commerce is continuing to improve the profitability. Sales is plus SEK 9 million, and the operating EBITA is plus SEK 11 million compared to last year.

If we then look at the more long-term trend for the second quarter, this page is showing sales as well as the operating EBITA margin for the second quarter from 2020 until 2026. We have the highest result in SEK this year with the first time it is above SEK 300 million when it comes to operating EBITA, but it's not the highest margin. We had higher margins in the second quarter during the pandemic due to a higher degree of consumer sales during these years.

However, the margin this year is above last year and is also the highest on -- for the latest 3 years with 11.5%. Pricing, efficiency improvements and cost control had a positive margin impact in the quarter compared to last year and has compensated the material inflation in the quarter compared to last year.

This page is showing the cash flow and the cash flow generations. To the left, you can see the cash flow generations and to the right, you can see the CapEx as well as the CapEx in relation to sales. The cash flow has been improved in the quarter, thanks to higher operating -- thanks to cash flow from operating activities, meaning better result compared to last year, but we have also positive impact when comparing to last year's related to working capital. And that is mainly due to less increase in operating receivables in the quarter compared to Q2 last year.

Looking at CapEx level, the CapEx level has been increased. It's now on a latest 12-month basis, 3.4% of sales and year-to-date on 3.2% of sales. So we are investing more in our facilities, in our operations to improve efficiency as well as, in some cases, also when it comes to capacity.

Then looking at the balance sheet and then specifically looking at the net debt. This page is showing the net debt, including IFRS 16 and also net debt in relation to operating EBITDA. Net debt has been increased during the last quarters and mainly due to acquisitions. And then, of course, we also paid a dividend now in the second quarter of this year. The net debt includes IFRS 16 debt of about SEK 475 million.

Looking at net debt in relation to operating EBITDA, we are on 2.2x, including IFRS 16 and 2.1x, excluding IFRS 16. If we then recalculate the running 12 months operating EBITDA and include the latest acquisitions, we have a pro forma, then we are on 1.8x, excluding IFRS 16, meaning we have comfortable headroom to the target of maximum 2.5x.

When it comes to our financial target on return on operating capital, we have a target of 15%. Operating capital has been increased during the last quarters, mainly due to acquisitions. And now in the second quarter, we have also improved the return on operating capital by 0.1% units from 11.7% to 11.8%, mainly thanks to improved result in the quarter compared to last year.

Then looking at the order intake and the backlog. Starting to the right, the order intake, the order intake is -- has been increased by 23% organically in the quarter compared to last year. And glad we can see that Consumer is plus 3% and then Project is plus 58%. Of course, we have a positive impact from the record order in Scotland of GBP 50 million. And thanks to the higher order intake in the quarter compared to last year, we have also a record high order backlog of SEK 3.3 billion. Project is plus 19% compared to last year and Consumer is plus 12% compared to last year.

If we then dig a little bit deeper into the order intake and we start with the Consumer. This page is showing the order intake, organic order intake growth in Consumer for latest 4 quarters from Q2 2025 until Q2 2026. If we start to the left, we can see the group development. So in Q2 '25, we have minus 4%, then was minus 2% in Q3, it was plus 2% in Q4. It was minus 2% in Q1. And then now in the second quarter this year, it's plus 3%. And then you can see that the positive development in this quarter is mainly due to Denmark as well as in Sweden.

The Consumer order intake is still negative -- still declining in U.K. and in Finland. However, the decline has eased compared to recent quarters. So the driver of the consumer market and the positive order intake is then related to Denmark and Sweden, which is also the largest markets -- consumer markets of Inwido. So in total, plus 3% in the quarter compared to last year.

If we then do the same thing and we look at the project orders, and first thing I would like you to notice is the scale of this diagram. The scale is now plus -- up to plus 300% and the consumer is plus -- was plus 20%. So the volatility is so much higher on the project market compared to the consumer markets. And thereby, we divide the order intake between Project and Consumer. And looking at this quarter, we have, of course, the high order intake in U.K. connected to the order of Scotland, and they are then driving the total order intake.

We have the highest project sales and most project sales, in Finland, it was slight decline. In U.K., big growth due to -- thanks to the big order in Scotland. Sweden will have also a slightly growth compared to last year. And the other markets, they only consist of about 30% of the total project sales within Inwido. And there, we have a little bit decline in Denmark. We have a growth in Ireland and also some growth in Norway.

Now then I hand over back to Fredrik for the conclusions and summary.

Thank you very much, Peter. Yes, it's time to round things off. So let me reiterate today's key messages.

Market-wise, first of all, it really is a mixed bag. Some markets are improving. Scandinavia is, of course, one of them, most notably, while some markets remain at record low levels, Finland included. We have not yet seen the full effects of the ongoing Middle East conflict. We have not seen the full impact of the EPBD, the Energy Performance for Buildings Directive that was recently implemented across the EU and should provide, of course, some tailwind in due course.

But where there are challenges overall, there are also opportunities. And again, whatever is facing us, I feel that we are ready. We have a strategy. We have a business model, a governance model that works really, really well as evidenced in this past quarter. So we built a Ferrari. It's beginning to drive a little bit faster, which is making both the driver and the car smile a little bit more than in the first quarter.

Outlook, yes, it's -- there is low visibility in the crystal ball. It's, I think, necessary to be quite open about that. We continue to stick to our game plan. We execute it step by step in a really good way. The near-term priorities include, first of all, to secure the supply chain, both in terms of negotiating cost increases from the surcharges and make sure that we get the raw material that we need, i.e., security availability of key input. And of course, to work with the value-based pricing to counteract the negative effects from the Middle East conflict, generally continue also with the cost containment and then continue to pursue our M&A strategy in a good way, although we are a little bit more selective at the moment.

So we are also reviewing the business unit portfolio. We have some companies still on our red list. Thankfully, a lot of them are improving their performance, but I'm also not excluding any minor restructurings at this stage. But so far, so good, I'd say. And as shown in Q2, we are really ready to embrace whatever the future has in store for us.

So with that said, Peter and I would now be delighted to answer any of the questions that you may have, please.

[Operator Instructions] The first caller is Jonny Jin from SEB.

I have a couple of questions. Starting off with the gross margin, it looks very strong here despite these higher raw material costs. And I think that you said the last time that you were expecting some yes, quarterly lag before it's fully compensated in Q3. So now you're actually performing better than I thought. So I suppose this is mainly a reflection of you driving higher volumes and beneficial mix. Is that a correct interpretation? And if not, is it possible to split the sort of price effect on organic growth in this quarter?

If we look at what we define as gross margin 1, meaning we take sales minus material costs, then the margin has declined. Then we'll able to compensate that when you look at gross margin 2 or gross margin as in the public report, we have been able to improve the gross margins, thanks to higher efficiency in the productions, meaning we have been able to increase the volume in the factories without increasing the cost so much.

So we have been able to compensate the material price inflation, which has been negative in general for the group by higher efficiency and a better cost control, mainly in the factories.

Understood. So one should read this maybe that -- yes, this is volume organic growth mainly in this quarter then and it's high utilization rate and better profitability.

Yes. And also in some markets, in some production units, we have made some investments, and we see that we also have been able to bear fruit from those investments. So we have improved efficiency. Inwido has, during the last year, even though the market has been quite challenging, we have been investing quite a lot of money into our factories to improve efficiency. In some countries, we have been able -- or some production units, we have been able to see improvement in efficiency, thanks to all the investments.

So yes, it is volume and efficiency improvements. So if you just take sales prices and material price inflations, then there's a negative impact in the quarter.

Understood. So I suppose that the price effect will be more visible forward in Q3 and onwards, then maybe, Is it possible to say something how much you have increased prices on average?

We can take -- it's a relevant question, of course. We can take Elitfonster in Sweden as an example, and that is, of course, a positive example. But it's been a lot of blood, sweat and tears and still is actually, to a large extent, as we negotiate contract by contract. But they have, as most of our business units and sort of an annual price increase. I'm not talking primarily on -- yes, linked to price list, et cetera, which is roughly 3.5% for 2026.

And then on top of that, they have been out, again, balancing these surcharges initially also, of course, trying to negotiate them down and being quite successful with that. But then on top of that, added -- yes, it varies a bit, but let's say, 3.5% to 4% in additional price increases. We do not exclude further price increases either if this conflict continues and at the moment, it looks as it will, then, of course, we will do our best to cover any additional price increases on the raw material or energy or transportation side.

That's not easy. It hasn't been easy yet, but it's something that we're, in a way, forced to do and committed to do. So that's a Sweden, Elitfonster example, that I think is rather relevant for at least the Scandinavian BA to some extent, the e-commerce BA. When it comes to the U.K., when it comes to BA East, it's been much more tricky because of the -- yes, the market conditions and the fierce competition.

Okay. Understood. And just one more on the raw material. When you talk to your suppliers now, are you feeling that raw material prices are still climbing? That's -- so that you are sort of chasing prices? Or have they, sort of, took a leg up and then settle at a higher level from here? What's your feeling there?

No, I feel that it's still moving material to be honest, Jonny. It's -- we've had a first wave of increases or attempted increases. And then as I mentioned, we've sat down account by account and been rather successful so far in negotiations, in some cases, even totally avoiding surcharges or at least mitigating them, decreasing them a bit, which offers comfort. But we haven't seen the end of this, particularly if the conflict continues.

So it's still a top priority for us. And at the same time, I think it goes to show that Inwido, we have the economies of scale. We are big and important customers for these suppliers, and we don't stand and fall with one supplier. We have a rather healthy exposure that is balanced across several suppliers, particularly for the critical input goods. So I think we are probably faring better than many of the others in our industry, but it is a tough battle.

Understood. Then I want to move to demand a little bit because I think, yes, in the last quarter in Q1, you said a stronger exit into Q2 here, and it seems like it's materialized as well. What is sort of your -- yes, just feeling when you look at your momentum here entering the second half of this year, is it sort of -- yes, these organic growth rates, are they to continue to expect in Q3, what you're seeing now or elaborate a little bit more there?

I mean you're right in saying that we did capture a lot of positive momentum primarily in Scandinavia from the end of Q1. And then, of course, the weather improved quite substantially. That's made a difference. And then Q2 is always going to be a stronger quarter than Q1. But we've seen a gradual improvement from April to May and from May to June. So that's, of course, promising. But it varies a lot still from one market to another.

Denmark, stable at a good level. Sweden gradually improving, but so far more on the Project side actually than the Consumer side, where if you read the sort of war-linked headlines in the newspapers, of course, of inflation potentially going up implicitly then indicating that also your interest rates on your mortgages will go up, then, of course, the households become a bit more sidelined again and the whole Middle East conflict becomes a wet blanket still on Consumer purchases.

Norway, bottomed out, but not really taking off either. Finland, super tricky. Slovenia, Croatia, Poland rather, cautiously optimistic about those as well as Ireland. And then U.K. is really patchy. Scotland, perhaps a bit better than England, but the difference is really between Consumer and Project where Consumer is still really pressed, I would say.

But of course, the -- I mean, to answer your question, the order intake that we saw now and the organic growth gives us some comfort. And the order backlog is, as Peter mentioned, at a record high level. But it, of course, also includes this Sidey Solutions order in Scotland. So yes, cautious optimism, I think, both in terms of volume and in terms of profitability. But the pattern over the last 6 to 12 months has been extremely bumpy. It's literally been from one top month to one all-time low month and then back up again. So it will be a bumpy ride also going forward.

And I think that's quite important that we keep our eye on the ball and we execute on our plan. It will not be a walk in the park. We work with scenarios rather than anything else. And of course, in a positive scenario, the Middle East conflict fades out in some kind of fashion and hopefully also the Ukraine war, of course, not to be forgotten. And that will be, I think, quite a nice boost to demand across both projects and consumers. Meaning, as Peter said before, we will have a very nice leverage from the investments that we've made in the past few quarters where we're really stepped on the gas pedal.

And I think we've done a good job holding back costs, holding back additional resources already now in the second quarter. It's very easy when you see demand going up all of a sudden that you start adding back resources again, but that's not really been the case for us so far. And so that's a priority to really leverage the efficiency-enhancing investments that we made in the past.

Understood. I understand. It's a very tricky market right now. But just -- as you said, it's a very bumpy between the quarters here. So I just want to make clear that the organic growth in this quarter, at least, it's a fair representation of what sort of the underlying demand was in this quarter because we also said we had some delays of deliveries from last quarters and stuff like that. So I mean, there's no unusual timing. We should read this as the actual demand in this quarter, this organic growth.

And just one thing that, Jonny, is, of course, that Q1 was very, very weak. We had a cold winter this Q1, especially the consumer market, its impacting consumer market. So some consumers were then postponing both in terms of sales as well as the order intake, not placing the orders, not taking the sales in Q1, it was then postponed to Q2.

So we had some extra Q2 related order intake as well as sales due to the lower Q1, so it was compensating Q1. So it should not be -- it's very hard for us to exactly calculate how much. But still, we have a positive order intake as well as sales in the consumer market for the first 6 months. But some of the growth of Q2 should be related to Q1 if the winter has not been so cold and so long as it was.

I understand. So maybe it's more I look at them combined to see the underlying demand.

Yes. Yes, that's a good point.

Good. Okay. Just one final on the profitability on the EBITA margin here, one on West and e-commerce because in West, EBITA margin looks to be down despite organic growth and better gross margin. So can you maybe some comment what's happening on the operating expense side there? And secondly, the e-commerce looks very strong, EBITA margin here at 12.6% this quarter and over 10% on a rolling 12-month basis. So do you think that these levels in e-commerce is sustainable? Or do you see any signs of increased competition or similar pushing down the e-commerce margins from here onwards?

Starting with East (sic) [ West ]. So we still have a very challenging market when it comes to the consumer market. So the project market, especially in Scotland is doing well. The acquisitions are doing well as well, but the consumer market is very challenging. So due to the consumer market, the margin has declined in the quarter compared to last year, even though it was a good sales growth, but the sales growth was mainly on the project market.

The second question you have when it comes to e-commerce. So before the pandemic, the e-commerce had an operating EBITA margin between 11% and 12%, around 11%. And the target is, of course, to come back to that level now in the future. So we are on a good trend when it comes to e-commerce and profitability. We have taken down costs. Last year, we took some restructuring costs within e-commerce. We closed down some areas, and we were more focused on pricing instead of volume, and that has been a positive impact. So yes, we continue to see improvement on the margins and then the target is to come back to the same level as we were on pre-pandemic.

Maybe if I can just add to what Peter said on the last topic of e-commerce. For them, it is a rather tricky balancing act between top line growth and profitability because entering new markets, which is part of their ambition and part of the group's ambition is at least in the short term, rather costly. It requires a lot of upfront marketing costs to just gain a foothold and to maintain that foothold. So that will be a balancing act also going forward.

The good news is that right here right now, we have a very lean and mean machine all the way from operations and manufacturing to cost-efficient, high-tech marketing to value-based pricing. So -- and I still think that there's -- and I know Bo's ambition is to capture even more. And on top of that, they're doing a fantastic job with their working capital. So hats off for that team and it will be, of course, very exciting and quite promising to look at the performance ahead as well.

We'll now go ahead with the next caller, which is Linus Alentun from Nordea.

Just starting with a follow-up question here on the raw material prices, maybe you already answered it. But I mean, if the pure price cost effect was negative here in Q2, should we expect that gap to narrow in H2 as pricing catches up here? Or do you still see a negative net effect here also in H2?

H2, perhaps not really. But in Q3, I foresee a negative impact and then we are on the right path, at the right level in Q4. Some of the material inflation has been a little bit also postponed. So we foresee a higher material inflation also coming into Q3. But in Q4, we will be on a back to basis, if you understand what I mean.

All right. Back on track. Perfect. Then just a question on Finland. I mean, it remains weak here with low volumes and price pressure that continues, although you're still profitable here. I mean, are there any signs here of any stabilization here? And under what conditions here, would you consider further restructuring of the smaller loss-making units? And if so, what would be the time line for this?

Yes. I mean there are some lights at the end of the horizon. I think also as one or two of our peers disappear into Chapter 11 and are not being picked up by anybody else, that, of course, offers opportunities for us. We have some hopes for additional tailwind coming from implementation of the EPBD in Finland. And there are talks -- early talks about maybe implementing something similar to the ROT program that we have in Sweden, i.e., some more incentives from the government to boost both new build and, particularly, renovation. But it's early days. When it comes to -- and at the same time, given all of that, I think we've done and are doing a really good job in terms of cost alignment. I'm rather impressed by that actually.

When it comes to portfolio evaluation, yes, that's something we do on a continuous basis. As I said earlier, we've seen some positive movement, generally speaking, on the -- when it comes to the companies listed on what we refer to as the red list, i.e., being in the red on the last 12-month basis. In Finland, we have some small entities, of course, that have lost some 50%, 60% of the volume where you simply cannot counteract that from a cost alignment point of view. So they're literally down to the bone chewing.

At the same time, some of them are rather dependent on a project here and there. So the picture can change quite dramatically actually from 1 month to another. But yes, I wouldn't exclude additional restructuring. And if that happens, it would be at the earliest, I think, in Q4, early next year. And again, it would only -- we're literally only talking about the smaller entities here.

Yes, the smaller loss-making ones, I guess. Perfect. A question here on the Sidey order. I mean, it gives you strong visibility here for several years in Scotland. I'm just wondering how large is the pipeline here for similar social housing tenders? And I mean, should we think about this win as something that can be repeated here in the future? You've talked about a lot of the pipeline in Scotland of these types of projects.

Yes. It's a relevant question, Linus. We -- I mean, you will recall that in December 2024, we announced what was then to date, the largest order for Inwido Group, again, coming from Sidey Solutions, actually, it was GBP 22.5 million at that time, and that was the first part of a 2-stage deal where the second part is actually up for confirmation later this year or maybe at the latest early next year. So that would theoretically be, if we win it or if they confirm it, that would be another GBP 22.5 million for Sidey.

But I think the pipeline looks rather healthy. And of course, it sometimes comes across perhaps as we have -- that there are no other actors in that market. But there are -- the competition is actually quite fierce, but the supply is rather healthy. There's a lot of social housing, not only in Scotland, but also in England. And we are we are beginning to see some signs of England following suit here from Scotland, where England is also beginning to deal with a huge overhang of renovation needs that still persists and is actually growing within the social housing sector.

So we remain quite optimistic about the exposure here. Let's not forget that Sovereign Group that we added now in the second quarter is also active in this field, but primarily within England, where Sidey Solutions, together with Walker Profiles in the West of Scotland are active primarily in Scotland. So we have really good coverage here. And yes, so the guys are -- they're doing a fantastic job, are well positioned for additional projects.

Again, these are -- GBP 50 million is not something we get every week or every year perhaps. But there are -- I mean, the projects are out there and that will come up for tendering, have a decent size. We're talking a few million pounds here and there and over a shorter time frame sometimes. So yes, it is an attractive market.

But the competition is very fierce.

Yes. And you have capacity in Sovereign Group as well if tenders would appear in England as well.

Yes, that's a very good comment actually that I forgot to mention myself. And I think it's linked also to the fact what I mentioned earlier that we have critical mass, generally speaking, now from both a manufacturing but also a market coverage point of view in both the U.K. and in Ireland. And the collaboration between the entities is going steadily up, which is really promising.

And on top of that, I think these entities are doing a really good job with the project orders. It's one thing to try to get in on a healthy take on margin. But then if you run the project over the course of, in this case, now with Sidey, 5 years, you better make sure that you have covered everything that needs to be covered for a rainy day so that your pocket margin, what you actually end up with towards the end of that project is at least as good as and hopefully and has proven historically better than the take on margin.

So again, the project management skills here are really, really important. And thankfully, in the case of both Sovereign and Sidey and Walker Profiles, they are really, really good.

All right. And -- on synergies here, let's change subject. I mean you mentioned that you have made some integration improvements here. Could you give me a concrete update perhaps on what has been implemented here? Is it sourcing, manufacturing, cross-selling, overheads and maybe quantify it a bit?

The biggest synergy we have are within procurement, also material price -- materials and purchase have not yet really started. Cross-selling is very little within this group because we have a decentralized model where each business unit are focusing on their own productions and their own sales and their own branding. So cross-selling and administration cost is quite limited. So our main synergies are within purchase as a procurement and has not really started for the latest acquisitions.

Some acquisitions we did last year when it came to -- when it comes to Aron Fonster and Fast Frame, there, we have started to see some impact, Victorian a little bit also, but the other ones, quite minor changes so far. It will come more -- it takes roughly 3 to 4 quarters before we can see some impact when it comes to procurement.

Then when it comes to productions and production efficiency and how to run the factories, that takes a bit longer time. In some cases, we have to make investments. Normally, it takes 1 to 2 years before we can see some impact on the efficiency improvements.

All right. So still more to come here. And just one last question here from my side. I mean you mentioned that the competitors have lowered prices here while you have been more selective in the quarter. Would you say that you have lost the market share in the quarter? Or what are your views here?

It's tricky to say right here right now. Where we do get that kind of market intel, particularly in a market like Sweden, there's always a lag of at least a quarter for that data to arise. In some cases, I think the short answer is yes. Am I worried about that? The answer is no. I'd rather continue to walk away from some larger projects or tenders where we believe being on top of our own cost base and given the uncertainty that's prevailing that where we actually walk away instead and have somebody else take a loss on it.

So I'm not at the moment and nor are my BU or BA presidents overly concerned about market share, to be honest. In this market, there are a lot of challenges. There's a lot of uncertainty, but there's also an opportunity to work with value-based pricing in a really solid way. At the end of the day, in our business, it all comes down to OTIF, i.e., on time in full, i.e., delivery precision. And there we score really, really high also in terms of quality. And so that gives us a really a really solid starting point to charge a decent price for the value that we bring to the table.

We now move to the next caller, which is Igor Tubic from DNB Carnegie.

I just had a couple of follow-up questions. If we just start to look at the Danish market, you mentioned that there was some pricing pressure in Q1. And I just wonder how do you manage that, so to say, in Q2? And should we expect -- or have you been able to increase prices there as well? Or can you just elaborate a little bit more about the Danish market?

The Danish market was -- had lower prices in the first quarter, but we decided not to reduce the prices as much. So we went more for profit for volume. And that meant that our factories was -- we had a little bit too low productions compared to our capacity in the first quarter, but we have gained that in the second quarter. So thanks to we're not reducing the prices in Q1, we could have better margins on the orders we came into in the second quarter.

And the reason -- the main reason was what happened in Denmark was many things. Of course, we had a cold winter, and that impacted the whole market. We had an election in Denmark. We had also the problem with Greenland and U.S. and the conflict. And that impacted total market in the first quarter and the total market went down and then start the price fight to buy in orders to the factories. But we decided to hold on our prices more, lost volume in the first quarter. But thanks to that, we gained margins in the second quarter.

Okay. And if we -- I mean, in terms of the trend, you mentioned that the consumer is starting to improve in Denmark, then I assume that we should not expect any price increases for the Danish market that's more volume-driven.

Exactly. The prices went back to a more normal level in the second quarter. So we foresee a more stable pricing development in Denmark. So it's more led to volume in the future.

And in terms of the EPBD law that you mentioned also, can you -- when do you expect to see some sort of effect from that? And have you started to see any effect in any of the countries that has implemented that?

Very limited, if any, effect so far. The deadline for the EU member countries was 29th of May. Still, there was an opportunity here, if you want to call it that, for each member country if they had legitimate reasons, they could postpone the implementation of the directive, i.e., into legal text, national law. And Sweden was one example of that, but a few other countries as well, where you have lower use of fossil fuel for your heating and where your energy efficiency is already deemed to be at a decent level, then you could postpone the implementation.

So I think we'll see limited impact for the full year at all 2026. However, I mean, we still see -- I mean, there's a discussion in Sweden, again, using Sweden as an example, of the 17th of August where Boverket will discuss and hopefully take a decision about implementing a similar to ROT, an incentive on renovation of houses, private houses built before 1989. And of course, if that comes into force, that would be a boost for the second half of this year in Sweden.

What we have seen following the cold and long winter that Peter mentioned before, we've seen a general increase in awareness of the fact that windows and doors have a huge impact on your quality of life, but also your electricity bill. So I think that has helped us a bit. And to some degree, explains why we've seen an uptick in demand now in the second quarter. I think that awareness is quite important, and it's become higher in countries or markets like England, for example, where we still use a lot of single-glazed windows rather than double or triple glazed.

So a lot of upside potential. I don't think we should expect too much coming from the EPBD this year, but hopefully more tailwind in the coming years.

Thank you so much for the questions. We will now round up this Q&A session with some questions that have been sent into us. And the first one is, could you provide more details on the growth outlook for the Nordic markets in the second half of 2026?

Yes. Thank you. My feeling is that we've actually covered that one through questions from the analysts here. So I'm not ducking it. I just feel that we've already responded to it.

Thank you for that. Maybe this one, do these long-term contracts in the West have price escalation clauses?

In some cases, yes. They are related to some index. If some indexes are going up to a certain level, then there is opportunity to have a price discussions with the customers.

Thank you. That was all the questions we had for today. So thank you so much, Fredrik and Peter for presenting here today, and thank you all for calling in and attending those questions, and we wish you a pleasant summer.

Thank you very much. Just to round things off, first of all, pencil these dates into your calendar, please, and don't forget to follow us on LinkedIn.

Last but not least, on behalf of Peter and myself, thanks, everyone, for attending this call. We wish you all a very nice and relaxing summer.

Bye for now.

Hello, and welcome to today's presentation with Inwido, where President and CEO, Fredrik Meuller; and CFO and Deputy CEO, Peter Welin, will present the report for the first quarter of 2026. [Operator Instructions]

And with that said, I hand over the word to you guys.

Thank you very much. Good morning, everyone, and welcome to today's webcast covering Inwido's first quarter performance of 2026. My name is Fredrik Meuller. I'm the President and CEO of Inwido since 2 years back. And next to me here in sunny Stockholm today is Peter Welin, our Group CFO and Deputy CEO.

Looking at the agenda and the material as such, we have listened to your feedback. We use today a new format, hopefully perceived as being a little bit more to the point at both group and BA levels. We will have a question-and-answer session towards the end of this call. And as usual, the material is, of course, also available on Inwido's website.

A seasonally challenging quarter in a turbulent context. I think the summary of that heading sums it up quite nicely. Given that and given the circumstances, I have to say that I think we do it rather well in what has been a challenging quarter. And to some extent, we have to start already at the end of the fourth quarter of 2025. We had a record-breaking December, following a soft October and November. And so, it was a strong finish to last year, indicating that we would have a solid start to 2026. And we, of course, also need to remind ourselves that Q1 is always the quarter with the lowest activity of the year, where we also need to balance our resources for the pickup in demand, a pickup in this industry early Q2. So we cannot take out all of the costs that would hamper us in Q2. But January, February were really burdened by harsh winter conditions across all of Europe really, including our markets.

And on top of that, we had some turbulence in the Danish market, which is somewhat unusual for us. Lower consumer confidence related to everything from the Greenland debacle to turbulence around the Novo Nordisk share, which is a major factor on the Copenhagen Stock Exchange, and on top of that, yes, harsh winter also in Denmark, and of course, also a new election. So there was a bit of a vacuum early in January, February. Momentum, however -- I will get back to that. Momentum, however, picked up quite substantially towards the end of the quarter.

Then, on top of that came the Middle East conflict spoiling the party, adding to uncertainty overall, although we haven't seen any major impact of that so far. We'll talk more about later on as well. So for us, it was, to some extent, back to the drawing board without panicking. We continue to align our cost, but that is not something you do overnight. So there's, of course, a bit of a lag before that -- those measures kick in. And it means that we've had a start to what is now de facto the fourth year of a historic industry downturn. But again, given the circumstances, I think we do it rather well. I'm quite impressed by the efforts taken across all of our 4 business areas. And financially -- Peter will cover the details of the financials in a second. But financially, we are back to "normal" pre-pandemic [ QI ] profitability. And that's also taking into account the fact that we had some negative FX impact in this quarter as well, around SEK 6 million on EBITDA.

What is important is that because there's always a silver lining, and this quarter is no exception. March was substantially better than January, February, in fact, almost record-breaking. And I think overall, April looks good. So some positive momentum that bodes quite well for Q2 and onwards, gives us some cautious optimism.

There are lots of positives to celebrate in this quarter as well. I'm very proud of the achievements that we have made, going everything from R&D, where we launched new products, to sustainability, which has been award-winning in many aspects. In fact, last Thursday, our business unit, Outline, in Denmark was commended as the #1 company in Denmark within diversity and #6 when it comes to employee engagement. We're #2 in employee engagement in Finland. We're #3 in employee engagement in Ireland. So there's still a lot of positive activity, and I think we handle the downturn in a very, very good way across the group.

Last but not least, before Easter, we concluded our fifth acquisition over the past 6 months, not bad, through the acquisition of Sovereign in the U.K. A fine traditional Inwido transaction, I would say, really, really strengthening our U.K. platform. And it goes to show that the road map that we are on towards doubling the size of Inwido by year 2030 is definitely achievable. And we do it in a -- still in a selective way, where profitability is just as important as growth.

Now, we have one slide for each of the 4 Bas, and the order is by size. We're starting with BA Scandinavia, where, as I mentioned, Denmark was softer, meaning that, that had a negative mix impact on the overall figures, not only for the BA but for the group as a whole. But I think solid performance also here, given the external factors. It's largely a volume and gross margin one matter. Particularly in January, February, Denmark was softer, meaning that there was increased price pressure. March, much, much better. We came out of the doldrums. And as I said, that offers some cautious optimism for Q2 and beyond.

[indiscernible] to mention, one specific BU continued to gain share already late last year, and they have also launched a new precision range. I myself actually attended a 2-day training course at our Lenhovda site and walked away with a big smile on my face, feeling that we have a fantastic BU with fantastic products and people. So that's important for the future.

If we move on to what is now a BA called West, previously Western Europe. West was, in this quarter, one of the stars, together with our e-commerce business. We have concluded 3 nice acquisitions, one of which after the quarter-end, as I just mentioned, and they're all contributing nicely already. So great to see the integration happening and with quite attractive synergy potential upside as well. Sidey Group in Scotland bucked the poor weather and the cycle and, in fact, had their best Q1 to date, which makes a big difference positively to the whole BA.

Worth mentioning more from a structural point of view in the U.K. and West market is that minimum wages have been raised yet again in England by 4.1% from -- as from 1st of April. We've also seen a positive reaction from the cold and wet and windy and snowy winter that people have become -- end consumers have become much more aware of the fact that their electricity bill has gone up and the fact that they need to renovate their windows. And in addition to that, there is now something called the Warm Home Act in the U.K. where the government is providing some incentives for renovation. And in Ireland, we have seen the equivalent of the ROT subsidy in Sweden now being implemented, which, of course, provides some tailwind for our consumer business.

Moving on to Business Area East. Yes, Finland, on top of very, very challenging macroeconomic conditions, had an unusually prolonged and cold winter. We had temperatures of minus 25, minus 30 degrees for several weeks in a row, meaning that it's not easy to run a window business during those conditions. And certain projects were, of course, deferred and some projects pushed to the sideline.

Having said that, we have continued to shave off costs in a creative way, painful as it may be, and I'm genuinely impressed by Antti and his team in how they try to manage the situation. Price pressure is immensely fierce, given the fact that the market -- the demand is just so low. And so, given the circumstances, I think we've done a good job. As a sign of the times worth mentioning is that one of our larger competitors, Fenestra, 2 weeks ago announced their bankruptcy. So it just goes to show that these are exceptional market conditions. Who knows? Hopefully, it -- I mean, it takes out capacity from the market. So hopefully, that's in a way, something that we can reap the benefits of as well.

Poland looks solid. And of course, we've added AJM, the acquisition in Slovenia, making it our 14th market in terms of manufacturing and 18th market in terms of manufacturing and sales. So that's really great to see.

Worth mentioning regarding Finland is also that as late as last week, finally, at last, the government is talking about implementing measures, and relatively soon implementing measures, again, similar to the RUT setup that we've seen in Sweden, and that has been beneficial in Sweden. They're talking about implementing some of that in Finland to get the renovation and the consumer side going again, which would, of course, be extremely welcomed by us and everybody else in the industry.

Last but not least, our e-commerce business is really going from strength to strength. I'm very pleased about the development here. It's the third consecutive quarter that we raised our profitability in what is de facto still a tough segment. Also here, of course, we saw some tougher conditions in Denmark at the beginning of the quarter, but quite a nice rebound towards the end of the quarter. And 191% higher profit is not bad; 4.5 percentage points on the margin side, I think, says it all. It's very impressive. It's a combo of cost efficiency measures that we started to take already 1 year ago and that we continued to take throughout 2025, but also very dedicated efforts within the field of value-based pricing. So these measures are kicking in quite nicely.

And in addition to Denmark, Germany is improving, and we have seen that we've gained market share in Q4 last year in Sweden, meaning that we are now #1 in Sweden. And last but not least, we can see, judging by Trustpilot scores, which are quite important in this business, that we score far, far higher than our peers. And I'm not surprised. I visited our Glodeni factory in Romania recently, fantastic factory, great people, great products. So we have a bit of a lean and mean machine now when it comes to online and our e-commerce business, which is great to see, onwards and upwards for Bo and his team.

Now, for more flavor on Inwido's consolidated Q1 financials, I hand over to you, Peter, please.

Thank you so much, Fredrik. I'm starting with this page. This page is showing the income statement for Q1. As Fredrik mentioned before, we had a good momentum end of last year. So when this year started, we had a positive order intake in December. And then, the cold and long winter slowed down the market performance in the beginning of the quarter, meaning we had too high capacity in the beginning of the quarter because we had forecasted with high activities, which didn't occur. Thereby, we had a lower gross margin this year compared to last year, a decline from 22.9% to 22.1% because we don't have the time -- we didn't have the time to adjust that quickly in the beginning of the year. And it shall be noted that everything we do is made to order. If we could be able to produce an inventory, then we could have been running the productions fully just producing to inventory, but we can't do that.

So sales in the quarter was up by 4%. Organically, it's down by 2%. We had a slow start in the quarter, but more positive end of the quarter. The EBITDA was down by 6% compared to last year, and the operating EBITA was down by 19% compared to last year from SEK 111 million down to SEK 9 million. And here, it's also included a negative FX impact of SEK 6 million. Further down the income statement, we can see that profit after tax was down by 55% and the earnings per share was down by 73%. Of course, we have a higher minority stake in the quarter this year compared to last year.

This page is showing the sales development, as well as the operating EBITA development in Q1, from Q1 last year to Q1 this year. We can see that we have lower results in Scandinavia and in East. And we have a positive improvement or positive result improvement in West, as well as in e-commerce. In West, we have a positive improvement due to, of course, acquisitions that have a positive contribution to the result in Q1 compared to last year, but we have also an organic improvement in West when comparing to last year. And then, e-commerce has continued improvement, as Fredrik mentioned before.

Looking more on a long-term perspective, this page is showing the sales and the gross margin development from 2020 until 2026. And this year, we have a higher seasonality impact in this quarter compared to last 5, 6 years. A minor of 4.3% is quite normal if you compare the margins pre-pandemic. Pre-pandemic, we were running between 4% and 5%. And in 2020, we had a margin of 3.3% in Q1. So we have a higher seasonality impact in the quarter. And it should be mentioned that the seasonality impact doesn't mean that they have an impact to the total year. It's just a shift between Q1 and the remaining quarters.

Looking at the cash flows. The cash flow development is always negative in Q1 because of seasonality. This year was no exception. So the cash flows before finance activities, excluding financial assets and acquisitions, was negative by SEK 212 million this year compared to minus SEK 187 million last year, a negative delta of SEK 26 million due to the lower operating results. So cash from operating activities was down by SEK 24 million. Looking at the CapEx level, the CapEx level is slightly higher this year compared to last year, but not a large increase.

Then looking at the net debt, the net debt has increased during the last months due to acquisitions. We have made 5 acquisitions, but only 4 have been paid for. The latest acquisition, Sovereign is -- will be included from April and paid in April. So the total net debt end of March is SEK 2.6 billion, including SEK 419 million of IFRS 16 debt and an acquisition debt of SEK 586 million. Net debt versus EBITDA is 2.0 including IFRS 16 and 1.9 excluding IFRS 16. However, if I then calculate with a pro forma basis, meaning I calculate for 12 months running rate for the acquisitions, when we calculate the net debt to EBITDA, it's on 1.7, meaning we have still a good leverage and a healthy position to make more acquisitions.

Return on operating capital has declined in the quarter, mainly due to the lower operating results, but we also have a higher operating capital due to the acquisitions. So we have a decline from 12.4% in Q4 last year down to 11.7% in Q1 this year, rolling 12 months.

Looking at the order intake and the order backlog. On this page, you can see -- to the left, you can see the order backlog, and to the right, you can see the order intake. I will come back more when it comes to the order intake on the 2 following pages. But starting with the order backlog, the total order backlog is 1% lower compared to last year. Projects is minus 5% and Consumer is plus 11%.

Looking at the order intake, the total order intake is plus 3% in the quarter. Organically, it's minus 3%, where Consumer is minus 2% and Projects is minus 5%. So if we then dig a little bit deeper into the organic order intake for Consumer and Projects, starting with Consumer, this page is showing the organic developments -- order intake developments of the Consumer from Q1 last year to Q1 this year, meaning the latest 5 quarters. To the left, you can see the total development of the group. You can see that in Q1 this year, we had minus 2% in Q1, and in Q4 last year, it was plus 2%.

Starting with Denmark, Denmark is quite stable. And then, you can ask me, have you forgotten Q1 this year? No, I have not. The Q1 is exactly on the same level as last year organically, thereby, there's [ no stable ] for Q1 for Denmark. So Denmark is quite stable.

In Sweden, we had a higher order intake all the quarters in 2025. We had a really strong end of Q4, and then we had a little bit weaker Q1 this year. And of course, the winter has an impact, but also the ROT program had some impact for the order intake. The ROT will not have an impact on the total sales or total development on a 12-month basis, but it's a shift between Q4 and Q1. So higher order intake in Q4, a little bit less order intake in Q1.

The consumer market in U.K. and Finland are still very challenging. And then, the rest, which is only 13% of sales, there we had growth, and we see growth in Poland as well as in Germany. And once again, this is organic, so meaning the latest acquisitions are not included and also adjusted for FX. So in Q3 and Q4 last year, the U.K. and the Finnish market was negative, but that was compensated by the Swedish -- by the order intake in Sweden. And then, in Q1 this year, Sweden has not compensated the development of U.K. and Finland, and thereby, we have a decline of 2% compared to last year.

The Project market, this page is showing exactly the same as Consumer and organic development of the order intake of the Project market. But I can only say this is so much more volatile. On previous page, we had a scale from minus 25% to plus 20%. Here, we are more or less minus 100% to plus 300%. So the order intake within the Project market is more volatile. And in total, it was minus 5% in the quarter compared to last year organically.

Thank you very much, Peter. It's time to round things off. And I think overall, I mean, Inwido's 2030 target remains firm. We are delivering on our strategy in a very good way. In anticipation of the organic growth and the market rebound or recovery, we are in a clever and selective way, conducting a lot of acquisitions, attractive acquisitions in both existing and new markets. We've signed and concluded 5 deals over the last 6 months. When I look into the pipeline of live and semi-live cases, I think it looks quite good. In fact, we have a few cases in totally new markets in addition to the ones that we've already added. It's a mix still of window and door businesses. but it includes also some targets within solar shading, which, as you know, and as mentioned several times, is another area that we want to enter into.

So I think we stand tall in the worst storm this industry has ever seen. We're turning challenges into opportunities. And to some extent, to use an analogy here, I think we're building, and to some extent, have built a Ferrari. In Q1, we were unfortunately only able to drive it at 40 kilometers per hour. So that's a little bit frustrating, but we're picking up speed, and that's important and bodes quite well.

I don't need to dwell on the headwind on the left-hand side, but more importantly, perhaps point towards the levers that we are pulling since, yes, a long time back. And this is, of course, something that we can never stop focusing on. This is always relevant for us, given the market context. On the cost side and the personnel side, we are taking out headcount. We are emptying [ time banks ]. We are forcing vacations, et cetera. It's painful, but necessary. We are tightening the screening of our portfolio and the BUs' performance in a clever and long-term way, meaning that additional restructuring may happen. But there's absolutely no panic. On the contrary, I'm quite confident about where we are and where we're heading. And I think it feels the same when I listen to the rest of my group management team and the BU management teams.

We are performing better than our peers. And overall, I think Q1 is actually a solid quarterly performance given the circumstances. Let's not forget that the fundamentals of this industry remain very, very strong. At the end of the day, people do need new windows and doors. We have lost some 20%, 30% volume and sales since the peak a few years ago. A "normalization" of this industry will implicitly mean quite a solid bounce back in demand.

So if we look at the outlook, yes, the world is in a crazy place. It's very difficult, both for us, our analysts, investors and everybody else out there to see what's around the corner. The Middle East conflict will most likely have a negative impact on raw materials, both price levels and availability. It will impact energy and transportation costs, but I'm not necessarily overly concerned about that. We have a governance model and we have a track record of being able to deal with those kind of circumstances, particularly looking into what we did during the pandemic. The question mark is more hovering around demand and how that will be impacted by this situation. If there is, of course, increasing threats about inflation, indicating that interest rates may go up, then of course, that could be another wet blanket on the consumer demand side. But let's see. Our size and our competence is -- and our importance, relatively speaking, for our suppliers is something that is certainly helping us in this situation.

So we are ready. We are focusing on what's within our control. Pro forma, we've added SEK 1 billion in turnover over the last 6 months through these mentioned acquisitions. We have a more lean operational setup. It's really all about volume and about going for profitability instead of volume.

So with that said, I think Peter and I would be delighted now to answer any of the questions that you may have, please.

[Operator Instructions] And the first caller here is Jonny Jin from SEB.

I hope you can hear me. I have a couple of questions. I will start with profitability and the operating expense side. Were there any unusual high cost in this quarter that we should not escalate going forward? And also tying that to your comments about increased market uncertainty and such, are you now actually implementing cost reductions ahead in Denmark or Finland, for instance? Or is this sort of the fair cost base we should expect in the near term?

Jonny, this is Fredrik. It's a relevant question, of course. No, I think as we said before, one needs to bear in mind that Q1 is a quarter where we always need to balance the cost. It will be very easy to -- but very shortsighted to throw out many more resources than what we have and what we can do. But that will bite us in the rear end if we do that already early in Q2 as the seasonal demand starts to pick up. And thankfully, this year, we've had -- following the harsh winter, we've had quite a nice spring season already in many of our markets. So, again, big variations from market to market.

In Denmark, of course, we're looking into what we can do to enhance the profitability even further. There is a lag before we take the measures and before we see the impact on that in the P&L. But overall, it's -- Denmark did come out of the doldrums towards the end of the quarter, much, much better compared to the beginning of the quarter. And in Denmark, we have some really, really nice entities that are doing a good job already. So it's more a matter of getting that volume back and actually, to some extent, walking away from silly price projects.

Finland is a totally different story. There, as you know, we have not only -- I mean, already before 2025, we started to adjust the cost base, both the fixed and variable cost base to the demand situation. And -- but you can only shave off so much. At the end of the day, you come down to the bone. And -- but we have, at the same time, continued to take additional measures. And I'm genuinely impressed, as I said before, by what we have achieved and how we can maintain momentum and this award-winning employee engagement level, given the circumstances because it is heavy. It is tough. And as I mentioned, we have competitors that are now going belly up, which is a sign of the times. So hopefully, the last piece of news in Finland, the introduction of some kind of government incentive scheme comes into play and very soon because that would be, of course, a big positive piece of news.

So yes, we're -- I mean, we are adjusting costs everywhere, but we are also confident about our OTIF, our On-Time, In-Full delivery precision because that gives us an edge vis-a-vis competition. It gives us an opportunity to also work with value-based pricing. So it's too easy to say that we should only work with the cost base. It's a bit more complex than that. Hopefully, that answers your question.

Yes, understood. But there were no extraordinary costs that we should be aware of in this quarter?

No, there's no extraordinary cost in this quarter. And it should be mentioned, if you take away acquisitions because we have quite many acquisitions that impact [ comparements ] when you're comparing Q1 this year compared to last year, but as we follow up on our cost base, meaning our production costs and our overhead costs, we have a cost savings of more than SEK 30 million in the quarter compared to last year, excluding acquisitions.

Understood. Okay. Moving to gross margin here, it declined in the quarter year-over-year and I suppose that is more of a reflection of volume and mix. Is that correct? And then more importantly, how should we think about the increased energy prices and raw materials going forward? What sort of the magnitude we can expect from the coming quarters? And are you now implementing price increases to offset that or.

So the first question is, yes, it's more -- it's volume and mix, more volume than mix, especially because of the lack of activities in January, February because we had planned with higher activities in January, February than what was the outcome. And then, of course, we have a mix because of the Denmark was a bit lower in sales compared to last year, and that has a negative impact on the margins.

Looking at your second question, we foresee material price increases, which will then impact in Q2. We will increase our sales prices. It is an ongoing process right now when it comes to our sales price and how much we're going to increase sales price because we don't really know how big the material price increase will be.

But that will then have an impact then from Q3. So there will be everything else equal, slightly impact -- negative impact in Q2 and then in Q3, we are back on track because it takes a bit more time for us to adjust our pricing. So it's a timing issue for us. So in the long-term perspective and looking historically, we have never had a problem because we are able to adjust and compensate on the sales prices, but it's a time lag.

Understood. Good. Then I move to sales a little bit. I think you mentioned some harsh weather conditions in the quarter. Have that affected deliveries in any material way, causing delays or similar?

Yes. The short answer is yes. Again, it's really been across all of our markets. In the West, it was more wet and unusually windy. In the East, it was more snowy and cold. And all in all, it has had quite a big impact, both on demand as such, but primarily on installations and project deliveries and what have you. So it's been deferrals, not cancellations in any way. It doesn't really work like that in our industry. It's more deferrals delays.

And again, that typically happens in Q1 every year, but this year has been exceptional. I think it's been the -- across Europe, the coldest winter since 2008 or something like that. So very wet in the West and a few weeks of a spell of minus 25, minus 30 degrees in the East. I hate to talk about the weather as one factor explaining the quarterly results, but this year, one really has to. And this will not have an impact when it comes to the full year because that will then be compensated in following quarters.

And the delays are on the product market. The consumer market has not such a delay. There is more delay that the consumers are waiting to place the orders instead of placing the orders in January February and March, you're placing the orders in March, April, June, et cetera. So it's a timing issue. So it's not an impact of total year. It's more a timing issue with lower Q1 and then that will then compensate in the following quarters.

Understood. Is it possible to try to quantify the effect a little bit of that delay?

We are talking about roughly 1% of sales that has been -- that shall be then moved to Q2. So roughly SEK 20 million, a little bit more.

Good. That's good. Then just one final from my side. I think this is more of a clarification question, and it's regarding your comment about higher activity levels and order intake in March compared to January and February. Are you talking about year-on-year improvement here? Because I suppose you always have this a little bit seasonality during Q1, where March is usually the strongest. So or anything deviating extra from the usual or.

Yes, it's more year-on-year, Jonny. It's a relevant question, of course. As you correctly point out, normally, we see a gradual uptick throughout the quarter. But this year, March was, relatively speaking, better than a "normal March. And of course, it's nice to see our acquisitions adding to that overall somewhat rosier picture as well.

Can you say something how much higher sales were in March year-over-year? Is that possible?

No, we don't give probably that figures, but I can say that January was worst January ever, and I've been here for 28 years. And then, February [indiscernible] and March was an improvement. I think we have an extremely bumpy pattern, which is not really something we've seen before. But if we start with Q4 already, I mean, October was challenging. November was an all-time low and then December was an all-time high.

Then as Peter said, January was an all-time low again, and then we're gradually getting back on track. So it was always going to be a bumpy ride. We talked about for a long time, and it's difficult to predict what's around the corner.

I think it's important that we stay focused on the road maps that we have. We continue to deliver on the strategy in a very good way given the circumstances, and we have a model, where we are prepared and we have the skills, the experience to deal with whatever comes in our way, both challenges and opportunities.

But as Peter said, it may be a lag of a few months every now and then depending on what happens in the exterior domain. But overall, I'm quite confident about what we're doing and where we're heading. So it was a positive organic sales in March this year compared to last year, sales growth March this year compared to March last year.

I'll just squeeze in for one final -- sorry, a lot of questions here. But in Scandinavia, organic growth took a step down here. It's down 3% organic, which is a slowdown compared to Q4. And I think you mentioned the ROT effect. So if we take Q1 and Q4 combined, organic growth is some 2%. Is that a fair reflection of underlying demand sort of now in near term or.

Yes. If you combine Q4 and Q1, and then you can see the total development. So there is a shift.

And then we go to the next caller and the cell phone number that ends with 8225, you have the word.

Can you hear me now?

Yes.

I think I muted myself and then unmuted again. So Albin here.

Hello, Albin.

Lots of good questions here from Jonny, but I have one more. You mentioned some time lag. But looking from here, I think Q2 last year, you had margin headwinds due to the significant Q1 to Q2 drop in order intake and demand, especially in Denmark, which we believe impact the margins in Q2 there. So how should we think about Q2 this year? Is it easier now to plan for you? And should we therefore expect that margins are up again in Q2 year-over-year?

I can't say it's easier to plan for because of the volatility as we've seen, as I said before, December, best December ever, January, the worst January ever. So it's a very volatile market for us. It's also hard to predict how the Middle East will have an impact on the consumer behavior and the consumer spending in Q2, which is, of course, a big, big question mark for us. So I can't say it's easier for us to plan for.

But my comment is more that everything else equal, an increased material price inflation will have a negative impact in Q2, and we will be able to compensate that from Q3. How big that is, it's also a question mark because it depends on how long this war is going to be and the impact on material prices due to the war. So it's very hard -- it's very tricky to predict. That's certain.

Yes. Maybe just to add to that, there is a lot of -- it's all about psychology if you look at the consumer side of things because, as Peter said, all else equal, and let's take Sweden as an example, the macroeconomics are there, right? And the households have thicker wallets than in a long time.

But with the uncertainty going on and -- and yes, it just makes it very difficult for everyone to push a button on a project like a window and door renovation project as goes to show. But the fundamentals are there. And Sweden as a market otherwise has quite a promising outlook, I would argue, irrespective of the fact that the ROT level is now at a lower level again.

We still have lower interest rates. I mentioned the household wallet. We still have easing of amortization of mortgages, et cetera, et cetera. The housing market has started to pick up momentum, primarily in the 3 largest cities, et cetera.

But I think what Denmark experienced in Q1, which was a relatively new situation for Denmark is really all about psychology and the sort of geopolitical unrest. Finland, yes, if you go there, you need to understand that they have a neighbor in the East that they have a history with. So it's not necessarily so that people are thinking about renovating their windows when they're not really sure about what will happen next week, so to speak.

So it's all in the shadow of the Middle East, in the shadow of Ukraine, in shadow of the Greenland debacle and what have you. We just need -- it's frustrating, but we need to pay respect to that, I think.

And is it possible to quantify what the impact of the, let's say, hard to plan moment last Q1 to Q2 did with the margins in the second quarter. Is it possible to quantify that? And correct me if I'm right or wrong, but Denmark has the last quarter with tough comps. This quarter was the last quarter with tough comps for Denmark, right? So it should be easier or.

I think Denmark had a good Q2 -- relatively good Q2 last year as well. But no, sorry, I can't quantify it. It's too many uncertain parameters right now.

Yes. I think when it comes to last year, it was more a matter of -- I would argue it was more a matter of parts of U.K. and Finland that were on the softer side. Sweden and Denmark were quite solid in Q2 last year. Sweden had a pickup because of the higher ROT level as from May last year. So it was more a matter of Finland that towards the end of Q2, we, of course, thought that Finland had bottomed out and then the floor just disappeared already in July. So there you go.

But yes, I mean, yes, it was really a mixed bag already in Q2 last year, and it continued to be a mixed bag across the markets. I think the good news is with the broad exposure that we have that we don't stand and fall with one single market, we have a mitigated risk in that sense with the broad exposure that we have. That keeps increasing, by the way.

Yes. Yes, for sure. And then maybe one question on another single market, ROT. You mentioned ROT in Sweden and there's some similar stuff in Ireland going on right now. Can you just comment a bit more on the details about that? When did it start? What do you see, et cetera?

Yes, you're absolutely right. In Ireland, they have actually quite recently introduced this -- I can't remember what it's called, but it's related to energy efficiency with the purpose of renovating old windows and doors. So the grant levels are actually very similar to what we've seen and are still seeing in Sweden at a high level. So that's, of course, a boost for the market and for us as such.

And again, as late as last week, something similar was mentioned in Finland. Now the proof is in the pudding that it actually becomes implemented, but the news was that they are looking into doing something like that very soon in Finland, and that would, of course, be welcomed.

Okay. That's a bad timing for the bankruptcy in Finland then. But speaking of that, is it any tangibles or intangibles for sale there that you're interesting of acquiring?

Sorry, say that again, Albin?

The company in Finland that went into bankruptcy restructuring, I think it's Fenestra or is there any intangibles or tangibles there that are interesting for you?

Most likely not. I mean it's early days. It just happened less than 2 weeks ago. But at the end of the day, it's capacity out of the market, which is good. But -- so hopefully, we can have a stabilization of pricing, price levels, et cetera. But yes, it's -- yes, this is more of a sales company. So yes, I don't think it will have any -- it's not really of interest for us in that sense.

Similar to what we've seen in the U.K., as you know, for the last year, we've had lots of teasers about various companies being up for sale, almost being panic sales, where they are in financial distress. And at Inwido, we don't do financial distressed acquisitions. So we just leave them. And thankfully, they have been left to their own devices as well. So nobody else has really picked them up. I think the same will happen.

The next call is Sofia Sorling from Carnegie. So the next caller is Sofia Sorling from Carnegie.

Two questions from my side. So first, why would you say the competition is more fierce in Denmark compared to, for example, Norway and Sweden? And also, do you believe that this competition is isolated to Q1? Or have you seen it continue into Q2?

I think it's -- we feel that it was -- with this magnitude, it was much more linked to actually January, February rather than March. Let's see how this develops. But as the market was just much smaller in that sense through lower demand levels in January, February. Of course, that quite quickly intensified the competitive nature of the market, meaning more price pressure than before. But we remain confident with the entities that we have and the market is -- and remains attractive.

And again, March looked much, much better than January, February. So we are quite optimistic about the Denmark development going forward. As Peter said, order intake-wise, it's quite stable actually.

And just on the question, why the competition was mainly in Denmark and not Norway and Sweden. Do you see any specific reason for that?

Well, Norway is, first of all, a smaller market for us and a small market as such. We have one entity up there doing a great job. And Norway, market-wise, I mean, the country is benefiting from higher oil prices, but the consumer side of things has been at a somewhat subdued lower level, and that's where it sort of stayed for the time being. So no major differences in context this quarter compared to previous quarters in Norway. Competition remains more or less the same.

In Sweden, we have thankfully gained market share. The industry association data, the freshest data is from Q4 last year. So it's a lag here of a quarter, but it indicated that we have gained market share primarily through our [indiscernible] business, and that's without reducing prices, by the way. It's by retaining a high OTIF level and by launching new products overall, just doing a good job on the -- particularly on the consumer side. So yes, overall, of course, competition is fierce.

In Denmark, I think the nuancing for Denmark was more that it was a somewhat new situation for us and for the market in the beginning of Q1, partly weather-related, partly related to, as I said, macroeconomic conditions, Greenland, Novo Nordisk and the elections.

And my last question, would you say that you're satisfied with the margin contribution from the new acquired companies, both in West and East?

Yes. Very much so. I mean we -- again, out of the 5 that we've acquired now, the majority of them have as communicated a higher profitability level than Inwido in general. So that's good. Then, of course, also -- they are facing also some seasonal differences, and that varies a bit from one entity to another.

The one in Slovenia -- we are learning, of course, now as part of their integration into Inwido that in Slovenia, Q1, there is even more seasonality in Q1 compared to what we are typically used to. Having said that, they've had a very good start to this year, relatively speaking.

So overall, really, really nice acquisitions, and it looks good also going when I look into the crystal ball looking ahead. Of course, we need to continue to be selective, particularly now in the current market context. We can see that a lot of companies actually improved their performance and did better in 2025. And then, of course, we are not alone with a more challenging Q1 this year.

So we can see that when we look into some of the other acquisition targets, potential transactions that we're working on, meaning that we need to bridge, yes, valuation gap one way or another, meaning that it may be somewhat more difficult to reach an agreement here and now.

Having said that, I think it looks quite good actually with the discussions that we are in. Solar shading is a little bit the odd bird in all of this because the larger incumbents, i.e., the ones that we are more interested in as an entry ticket into solar shading in addition to the smallish entity that we have in Finland already. They are performing really well, which is good news.

But if they don't have to sell and there are really not any structured auction processes in that field at the moment, then of course, the price side goes up a bit, meaning implicitly that we need to be dead certain about the savings coming from sales synergies, in particular, in this case.

There will be some cost synergies as well, but particularly sales synergies. So yes, a difficult market, but again, doing better towards the end of the quarter. And again, April has started in a good way and M&A activity remains high.

Moving on to the last caller here, which is Linus Alentun from Nordea.

Just a quick couple of questions here from me. You mentioned walking away from silly price projects in Denmark. I was just wondering if you could give a sense here of how much volume you are deliberately sacrificing here?

Yes. Not too much, I would say. I mean we need to make sure that we all understand that Denmark is not -- I don't want to make it come across as Denmark is sort of on a similar level like Finland or anything like that. It's definitely not. Denmark is very, very solid.

But of course, we have strong positions to defend. We have strong brands to defend in the Danish market. So we are really cautious about going into some projects that for us don't really make any sense.

Let's not forget that we are in the sort of upper medium to premium, premium niches of the market. So it's not in any major volumes that we're talking about, Linus, when it comes to Denmark.

In Finland, it's a totally different story there. The pond has just become extremely small, meaning that everyone is fighting for volume, us included, meaning that we have lost quite a lot on the gross margin one level.

In Denmark, it's a different story. And again, we think that was more of a short-term thing in January, February compared to a long-term thing as we look into what's happened in March and onwards.

And just on Finland, I mean that was a pretty weak result. But as I understand it, there is a lot due to the weather here. Can we expect some sort of pickup here in Q2 in Finland?

You shouldn't expect a lot. In fact, the really only limelight in what is, in fact, a rather dark market context is, as I said, last week's announcement by the Finnish government, which are really the first announcements that they are looking into and preparing for some kind of rollout of a ROT -- similar ROT program that we've had in Sweden. They have a history of looking into what their friend, their neighbor on the west side of the country is doing. And I think that they're doing exactly that also for something to happen, hopefully now later in Q2.

But other than that, let's not have too high hopes about Finland. We've had that before. I was somewhat optimistic about Finland a year ago, and I was proven very wrong just a few weeks later. So let's hope they can surprise on the positive going forward. But we hope for the best, but prepare for the worst.

Having said that, I think we are doing really, really well over there, relatively speaking, given the circumstances. And again, we have peers that go belly up, whereas we are still alive and we are -- we have entities that, of course, make money despite the fact that we've taken out a lot of resources, which has been super, super painful. And again, we are winning awards for the [indiscernible] that we have, the DNA that we have in the organization, which to me is super impressive.

And just one last question here back to the U.K. You mentioned the minimum wages here up about 4% from April, right? I was just wondering if you could perhaps give some rough quantification of the impact here and -- or are you able to offset this straight away through pricing or.

Yes, I don't know the exact impact. But of course, from a -- if we take a step back and look at the country as such, it's, of course, a lever that the labor government is pulling with all good intentions, but in a country, where productivity has at least historically not necessarily followed suit, it becomes a bit of a challenge for at least more labor-intensive industries in that country.

We, as you know, have a mix of PVC manufacturers and timber manufacturers. And of course, the PVC manufacturing is less labor intensive. Overall, of course, we are trying to push that cost increase onwards to customers. I think we do a relatively good job with that given the circumstances.

But it's trickier to do so in the customer, in the trade part of the business -- sorry, in the consumer trade part of the business than in the project business. So it sort of reduces -- theoretically reduces the competitiveness of England as a country.

For us, as witnessed by the acquisitions that we have made, which are, by the way, contributing very nicely already, it is possible to make money in that market. And let's not forget that it's the de facto, the second largest window and door market in Europe. So -- and we are #2 in that market.

So for us, we see scale benefits. We have our entities collaborating more and more, much more compared to what they did in the past. So that all bodes really, really well. We have some new people on board and more people coming on board.

So we are quite forward leaning when it comes to the U.K. outlook. In the near term, it will be perhaps more within social housing than anything else. But as goes to show with, for example, the Victorian Sliders acquisition, you can make some really nice money in that market if you do it well.

Lot of opportunity, I understand.

And that was all the questions we had here. So I will now hand over to you, Fredrik, for some concluding remarks.

Thank you very much. Please pencil these dates into your calendar and don't forget to look at our newly released annual and sustainability report as well, hot off the presses. Thank you, Peter.

Thank you, everyone, out there for attending and listening. And let me also thank all of my Inwido coworkers and our business partners for a job well done throughout Q1 of this year. Thank you very much. Bye for now.

Hello, and welcome to today's webcast with Inwido, where President and CEO, Fredrik Meuller; and CFO and Deputy CEO, Peter Welin, will present the report for the fourth quarter of 2025. [Operator Instructions]

And with that said, I hand over the word to you, Fredrik.

Thank you very much. Good morning, everyone, and welcome to this webcast for Inwido's Fourth and Final Quarter of 2025. My name is Fredrik Meuller, I'm the President and CEO of Inwido. And by my side here today in sunny Stockholm is Mr. Peter Welin, our Group CFO and Deputy CEO.

As usual, we will go through the highlights and the detailed financials of both group and the BAs, and then we'll finish off with conclusions and of course, open up for Q&A towards the end. In the spirit of transparency, we have also added a few new slides that I hope and think that you will appreciate. As usual, also, the material is, of course, available on Inwido's brand-new website. So do take a look at that.

In a nutshell, this is sort of summarize where Inwido is finding itself at the moment, but also where we're heading. We are on a super exciting journey towards becoming a company twice the size of what we are today. It's not all about top line, of course. On the contrary, it's about profitable growth. So rest assured that the bottom line is and will remain important as well. We are very pleased about how we execute our strategy in what is the fact of still an unprecedented industry downturn.

This is, of course, a familiar slide to many of you. Do note, however, that we've now added Ammanford in Wales and Kungota in Slovenia on the map representing the 2 latest acquisitions that we did just before year-end last year, meaning also that pro forma, our sales are now closer to SEK 10 billion rather than SEK 9 billion before. We are de facto one of the leading players across Europe. But again, we have many white spots on the map. So lots of growth opportunities for us to pursue. We're de facto only in one of the top 10 geographic markets in Europe. So with that said, again, huge potential to grow from here.

Let's now dig into the quarterly and full year highlights at the group level. And starting with the quarter, I mean, market-wise, it's yet another quarter with soft demand in both the renovation and the new build sectors overall. Similar to Q3 last year, the geographic pattern is a bit mixed, large variations across the markets. We continue to see Sweden progressing and improving. And at the other end, Finland is still very challenging and parts of England as well.

Still, I think it's highly pleasing and rather promising to see the uptick in organic growth, both in the net sales and also in order intake for primarily the consumer side. As -- when we talk about the order intake, I think it's important to bear in mind, and as we have flagged before that the comparison with the fourth quarter of 2024 is a bit tricky because, as you recall, we, in December 2024, had a record order from the Sidey Group in Scotland, equaling GBP 22.5 million. So -- but adjusting for that, actually, net-net, we have -- we come out slightly positive also on the organic order intake now.

Group gross margin, one, rather okay, a function of pricing -- value-based pricing activities and a rather stable raw material dimension. Having said that, we've had, of course, a less favorable mix, both in the geographic dimension where Sweden has outpaced Denmark in growth, for example, but also where we've had more project sales than consumer renovation sales. On top of that, we've also been hampered by negative FX impact from a stronger Swedish krona. We'll get back to that later on.

Looking at gross margin, too, I think it's quite solid. It's really a lot about efficiencies in all forms and shapes. Our investments from previous quarters are beginning to pay back, which is great to see. But overall, it's about cost consciousness, restructuring where we shut down a smallish entity in Finland and generally taking out cost. So that has, to a large extent, really offset the drop, the negative headwind that we've had in other dimensions.

I think it's important still to remind ourselves of the fact that the industry fundamentals remain the same, and they remain rather positive. At the end of the day, people do need windows and doors. And there's a lot of pent-up demand in both the renovation and the new build sector. Both need to grow from here.

Last but not least, we've been successful within mergers and acquisitions. We are not stressed up about it, and we're definitely not overpaying for the assets that we come across. But it's great to see that our activities, the focused efforts that we have within acquisitions have paid off, and we've added 3 new companies in the quarter, 4 new companies over the last 4 months. And hopefully, of course, there should be more to come in the M&A dimension.

Cash is king, strong cash flow and a lot of working capital excellence, primarily within the e-commerce business area. And of course, we've had a somewhat lower CapEx than expected that also strengthens our war chest and our financials, making them even more solid going forward.

So a snapshot of the quarterly key financials relative to the same quarter last year. Again, on the order intake side, one needs to make an adjustment for the Sidey record order in December 2024, meaning that overall, order intake is actually in line with last year or, in fact, slightly better. As mentioned already, operating EBITA was hampered by SEK 13 million negative on the FX side, but again, offset by efficiencies that started in -- yes, to a large extent in Q3, but in some cases, actually already in Q1 last year. You will recall, hopefully that primarily back then, our business area e-commerce took the opportunity to make their setup a little bit more lean and mean, and that has paid off. And on top of that, then we were forced to make more adjustments in -- primarily in Finland in early Q3 as demand back then surprised us negatively.

So all of that is beginning to and have, I would say, really had an impact in the fourth quarter, which is great to see and making us more ready for what's to come as we now have ended 2025. Main contribution at the BA level is from BA Scandinavia and BA e-commerce. The other 2 have done a great job as well, but are facing tougher market conditions. And again, strong cash flow, still rather low gearing. It has been affected by acquisitions, of course, Peter will talk more about that, but we still have plenty of room to pursue additional acquisitions from here.

So overall, if we zoom out from Q4 and we add the previous 9 months to close the books on the full year of 2025. Market-wise, it has yet again been a roller coaster ride. At the beginning of 2025, we thought that -- I thought that it would be the beginning of a bounce back in demand relatively quickly in Q1 already, we did notice that, that was not really going to be the case. And then as stated, Q2 added quite a lot of geopolitical turmoil, and that has been a bit of a wet blanket on consumer demand, in particular throughout the entire year of 2025.

Still, I think we come out stronger than before. We're, again, successfully executing our game plan. And we are definitely ready for whatever 2026 has in store for us. So I'm overall very proud of what we've achieved. And pro forma, of course, we've added almost SEK 1 billion in turnover. We have more lean operations, and that bodes well for the future. I think importantly also worth noting is that we do deliver a healthy dividend to our shareholders at SEK 5.50, i.e., same level as last year.

So to sum up the key financials also for the full year of '25. Importantly, I think we are displaying an organic top line growth and a healthy profit margin, which is really a quality seal of what Inwido is all about. Again, FX headwind, actually SEK 30 million affecting EBITA on the full year level and still low volume. But I think we met it by really successful collaboration. So there is more on the synergy side from us working in the horizontal dimension across all of Inwido, which is great to see and additional efficiencies, consciousness and investments paying off dividends. And then on top of that, the successful M&A work. So overall, I'm rather pleased with what we've achieved.

Yes. Again, large market variations across our business areas. Sweden continues to improve, boosting Scandinavia. And of course, the ROT incentive where the government raised the level in May last year had a positive impact. But all of our Swedish entities, I'd say, have done really, really well and particularly Elitfonster. And that, of course, makes a huge difference to the BA as such.

Denmark looks solid. We hope and think that the Greenland debacle, the Greenland matter and Novo Nordisk turmoil that we've seen over the last 12 months, so to speak, that, that does not have a negative impact on demand and sentiment overall in Denmark. And so far, so good, I would say. Same thing with Norway, where we are doing a really good job in still what is de facto quite a tough market, but we think that Norway has stabilized and bottomed out.

If we move across to BA e-commerce, yes, similar pattern as in the previous quarter with, yes, Sweden improving. We, of course, see quite positive outlook on Sweden, strong macroeconomics. It's an election year, and we're beginning to see that the housing market is moving, more transactions being done and at somewhat higher price levels, starting, of course, as usual with inner city of Stockholm. But that's, of course, overall positive news for us. On e-commerce, Black Week, which is important in Q4 was rather successful.

If we move West and going into Western Europe, Ireland remains quite buoyant, and U.K. is patchy. Scotland faring better than England still. England tricky, but quite a mixed bag. And I think there is some light at the horizon. There are increasingly talks at the government level about how to further boost the economy from where they are right now. And for sure, they need some support to get consumer sentiment back.

Last but not least, Eastern Europe, which in our case, as you know, is largely Finland and to some extent, Poland, well, not really improving, I have to say, still very, very tough. And here, I'm lacking still incentives and clear measures taking at the government level. Having said that, there is a new tax regime with the intention, of course, to make households a little bit better off. And hopefully, that will kick in now already early this year. Poland doing quite okay, stabilizing with a reasonably positive outlook actually.

So as stated before several times, we, of course, need to grow by some 15% CAGR on top line in order to get to our 2030 target of getting to a SEK 20 billion turnover. That is definitely achievable. And I think we've proven over the last 4 months that we can do it and that we can do it in a clever and profitable way. So it's -- again, it's not just about top line. We need to bear in mind what kind of reputation we have given the 50-plus acquisitions that Inwido have done over the years in a really, really good way. So we continue to be very picky. And thankfully, we continue to be perceived as a very attractive buyer with the model that we have.

And I think overall, the market is improving. There is quite a lot of M&A activity going on, including some strategic assets that are in play, we think. But again, we're picky. And the 4 acquisitions we did are really classic Inwido transactions, I would say. And the first 2 ones that we got in yes, late Q3, early Q4 are already contributing in a really, really nice way, proving that they were the right deals to do. And great also to see the acquisition of AJM, which means that we've added yet another country, Slovenia, to our geographic footprint. And Slovenia is a very solid market, and it also provides us with access to Austria and Switzerland, which are also really, really interesting for us.

So overall, very pleased with our M&A efforts. They continue, of course. And when I look into the crystal ball and when I look at our funnel and pipeline, our cases and activity level and the overall discussions that are live, I'm reasonably optimistic. I think it looks quite good. It's a nice balance between new and existing markets. It's a nice balance between medium-sized and large assets actually. So in the meantime, we see that some of our peers are struggling in some of the markets that we're in, primarily Finland and the U.K. So in England, of course, we continue to see quite a few cases popping up, but many of them are cases that are in financial distress and i.e., they are not of interest to us. There is quite a lot of capital out there. We do see competition in the processes that we're in, but it's not sort of crazy bid levels, and we wouldn't do any stupid transactions here. The multiples, I think, still are very reasonable.

We are also looking into the field of solar shading. So in the pipeline of cases that we are working with, both on the sort of gross and net list, there are a few assets with the solar shading label, which is, as we've stated several times before, it is an area of interest to us. Here, profitability typically is much higher than in the traditional window and door business, meaning that we may have to pay multiples that are somewhat in the higher end of the range that we typically pay. But again, very nice companies. And here, we, of course, see sales synergies on top of the cost synergies.

Moving on, and it's great to see smiles on people's faces and particularly our coworkers. I think it's a lovely picture. And within sustainability, we have every reason to smile. One example is our employee engagement survey that we do every year. And in -- now in Q4, we actually achieved the highest ever score, and we have had the highest ever response rate, which is a fantastic outcome given that it's been a very challenging year with lots of changes going on and of course, lots of cost cutting as well. I think it's a sign that the group management team and all of our BUs have done a really, really good job in explaining where we are and where we're heading in a credible way, and it has to be like that, of course.

So very pleased overall here. We have KPIs moving in the right direction as they have been on a positive trend for a really long time. And particularly, our carbon dioxide number is down by a lot, which is the function of both our own activities, improving our CO2 footprint, but also very fruitful collaboration together with our business partners and suppliers. So it just goes to show that we're in it together. And we're getting a lot of external credit here as well, of course, for our overall sustainability work. It's really, really a natural part of our DNA. Can never rest on our laurels, though, and particularly when it comes to accidents and incidents, that's always and always will be very, very high on our agenda.

So with that said, for some more flavor on Inwido's Q4 and full year financials, I hand over to you, Peter.

Thank you so much, Fredrik, and I'll start with this picture. This picture is showing the income statement. To the left, we can see the Q4 developments. And to the right, we can see the full year.

Starting with the quarter, sales is plus 1%. We still have the same negative mix impact, meaning that consumer sales are declining and the product sales is growing. The reported consumer sales is down by 1% and the product sales is plus 4%. The organic sales was plus 3% in the quarter. And here is the consumer sales plus 1% organic and the product sales is plus 6%. So we still have the same negative mix impact as we had in Q2 as well as in Q3. And that can be seen in our gross margin development. The gross margin has declined in the quarter from 25.9% last year to 25.7%. Then we have been able to offset that by reducing our costs meaning that the operating EBITDA margin as well as operating EBITA margin are on the same level as last year.

We have made acquisitions and acquisitions have a positive contribution to the quarter, but we also have a negative FX impact from our translation exposure. The group doesn't have so high transaction exposure, but we have a high translation exposure due to stronger SEK, where we are then consolidating the Danish result as well as the Finnish results into the group. And the FX impact is more or less the same negative impact as the positive impact from acquisitions, so they offset each other.

Below the operating EBITA and down to EBITA, we have nonrecurring items of SEK 26 million in the quarter, whereof SEK 21 million are connected to acquisitions. So SEK 21 million acquisition costs and then SEK 5 million as structural costs. The structural costs are mainly connected to Finland, where we're taking more actions due to the market developments. And also, we have reduced a business unit called Finluft and merged that into another business unit in Finland. And that has cost -- we have taken some costs in that in the Q4.

Further on the income statement, we can see that profit after tax is down by 7% compared to last year, even though EBITA is on the same level as last year. We have a little bit higher financial net or negative financial net in the quarter compared to last year. And we also have higher tax costs in the quarter compared to last year. Due to our acquisition costs that are nondeductible. And we also have some losses in U.K., and we cannot utilize those losses on the tax calculations for this year, can be used in the future now after we made more acquisitions in the U.K. that are profitable. And then we also have a higher minority stakes or minority result in the quarter and thereby, earnings per share is down by 9% compared to last year.

Looking at the full year, sales plus 2% organically is plus 4%. We have an operating EBITA margin of 10.5% for the full year compared to 10.8% last year. We had a good development in Q2, and then we had a margin decline in Q2 and Q3 -- sorry, decline in the Q1 and then the margin development in Q2 and Q3. And now in Q4, we are back on track again. And the earnings per share ended at SEK 8.87, minus 5% compared to last year.

This page is showing the sales development as well as the operating EBITA development for each business area in Q4. To the left, you can see the sales development. And to the right, we can see the operating EBITA developments. The main takeaway on this page is that Scandinavia is stable, higher sales as well as higher results, lower margins due to mix, not the mix between consumer and project, it's more mix between the different business units. The Swedish market is growing more compared to the Danish market, and thereby, we have a lower margin for Scandinavia, but still a stable development for Scandinavia.

We can also see that Eastern as well as Western are still challenging, lower sales as well as lower results. And we can see that the margin focus on e-commerce is paying off. In the quarter, sales is down by SEK 3 million for e-commerce. However, the result is plus SEK 12 million or more than 50% higher increase on the operating EBITA compared to last year for e-commerce. So the action taken when it comes to e-commerce, we have reduced the cost in e-commerce. We have taken some restructuring costs both in Q4 last -- in 2024 and also beginning of this year, and now we can see the payoff of those actions.

This graph is then showing the operating EBITA margins as well as sales for Q4 between 2019 and 2025. And we can see that we are back on track when it comes to the operating EBITA margin for the quarter. same level as last year and also looking at long-term perspective, we are back and have a high level for Q4 this year.

Looking at the cash flows. This page is showing the cash flow. So the left, you can see the cash flow development, cash flow before financing activities, however, excluding financial assets and also excluding acquisitions. And to the right, we can see the CapEx level this year. The cash flow was strong in Q4. We have the strongest cash flows in Q4 [Technical Difficulty] from operating activities was above last year. And when it comes to working capital, we are not as positive development of working capital as it was in last year. However, if we look at our working capital in relation to sales, we are more or less on the same level as last year.

And then when it comes to investments, when it comes to CapEx, we have lower CapEx in the quarter -- in Q4 this year compared to last year. We have also lower for the full year, and we were expecting a bit higher CapEx during 2025. However, some projects have been delayed and some project has been postponed into 2026.

In the quarter, we have concluded 3 acquisitions. We have paid for [ RM Fonster ] in Sweden, Fast Frame in U.K. and also Victorian in U.K. When it comes to AJM, that acquisition is not yet -- it has been closed now in January, but was not closed in Q4 and has not been paid for in Q4. So this means that the net debt has increased in the quarter due to the 3 acquisitions, RM, Fast Frame and Victorian.

When it comes to Victorian, we made that acquisition very late in 2025, late in December, meaning that balance sheet is included and the payment for the shares are included in the quarter, but not the income statement. So we don't have any results from Victorian in 2025. They will be consolidated from 2026 when it comes to the income statement. And then AJM will be fully consolidated also from 2026.

So the net debt has increased to SEK 2.1 billion, and that includes IFRS 16 loans of SEK 483 million. So net debt in relation to operating EBITDA is now 1.7x, including IFRS 16. However, when I calculate a pro forma basis, for the EBITDA, meaning I include full year results for RM, Fast Frame, Victorian, then the net debt to EBITDA is 1.5x, including IFRS 16. Excluding IFRS 16, we are on 1.4x reported and on a pro forma basis, we are on 1.3x.

The acquisition has also had a negative impact when it comes to our calculation of return on operating capital, especially Victorian because the balance sheet is included, but not any results. And that's why we have declined in the quarter from 12.7% in Q3 down to 12.4%. So we are 0.3% units behind last year, and we are also behind the target of 15%.

Looking at the order backlog as well as the order intake, starting with the order intake. In Q4, as Fredrik also mentioned, we took this large order in Scotland and a large order of GBP 22.5 million. And they were booked in Q4 because the order was received in December. So the order intake -- organic order intake is down by 12% compared to last year. However, when we adjust these large orders, we are slightly positive compared to last year. The positive thing is that consumer is growing. We have a positive order intake of plus 2% organic in the quarter and the project is down by 28% due to the orders in Scotland. Adjusted for order in Scotland, the project is also slightly positive. The order backlog is slightly lower this year compared to last year. Project -- the order back of project is down by 11% and the consumer is down by 1%.

If we then look at the order intake and then we divide the order intake between the different markets and starting with the consumer. This page is showing the order intake, organic order intake per quarter from Q4 last year to Q4 this year, meaning development during 5 quarters. And now we are separated by market, so not by business area, meaning e-commerce is now -- the e-commerce sales in Denmark is reported in Denmark and e-commerce sales in Sweden is reporting sales, et cetera.

The most important market for us is Denmark. The Denmark stands for 43% of our consumer sales. The second most important market for us is Sweden stands for 25%. On this page, we can see that in Q4 last year, we had a negative organic order intake of minus 2%. Then in Q1 this year, we started the year positive at plus 2%. Q2 was minus 4%, Q3 was minus 2% and now Q4 is plus 2%. And when I look at the development between the markets, we can see that Denmark, which is the most largest market for us when it comes to consumer sales, is quite stable. And we can see a positive development in Sweden on all quarters. Q4 last year -- until Q4 in 2025 had a positive development when it comes to the order intake.

And we can see that U.K. and Finland, which stands for 12% of our -- U.K. sales was 12% of our consumer sales and Finland for 8%, they are still challenging. They've been challenging all over the year, last 5 quarters. And then the rest, they are quite small. Rest is Norway, Ireland, Germany and Poland. So stable development in Denmark, positive in Sweden when it comes to consumer order intake, U.K., Finland still a challenging market for us.

When it comes to the project sales, and the main thing when it comes to project sales is it's a higher volatility in the project sales compared to consumer sales. So now we have to have a graph where we go up to plus 250% because in U.K. last year, we took this large order of GBP 22.5 million, and we had an order intake growth more than 200% in Q4 last year. And this year, since we are comparing to last year with these large orders, we had quite a large decline in U.K.

We can see a quite stable development in Finland during the last quarters. We can see also quite stable development in Sweden, some growth in Denmark, but Denmark is only 8% of our product sales. And then Ireland is also quite volatile because there, we also take large orders. However, Ireland is only 4% of our total product sales. So the product market is much more volatile compared to the consumer market.

And when it comes to the order intake, you should not look too much on a single quarter. You have to look more on a rolling 12-months basis, in some cases, also the rolling 24-months basis to see the development when it comes to the product order intake. The sales within the product market is stable, but the order intake is very much volatile.

Thank you very much, Peter. Have a glass of water. I think it's now time to look into our 4 business areas in more detail and starting with Scandinavia, of course. Yes, very positive to see organic growth in both sales and orders, driven by Sweden again, as we mentioned several times already. And particularly Elitfonster doing a great job. Also operationally, and I think worth mentioning is that they got Supplier of the Year Award from the Optimera Group over here in Sweden, very much linked to their high OTIF on-time-in-full delivery precision. So a great job there.

The flip side of Sweden doing better is, of course, that it means that we have a negative geographic mix impact since Sweden is doing better than Denmark. And on top of that, of course, we have translation effects from a stronger Swedish krona. When we translate profits in Denmark, for example, and in particular, it becomes less worth when we take it into Swedish krona. But overall, great cost consciousness, great efficiency, leveraging the investments made across the entire BA. So well done, Mats and team. And it's great, of course, also to see that the latest acquisition in this field, RM Snickerier in Vimmerby is already well integrated and already contributing in a very nice way.

Let's move to the East, and that's actually exactly what we will name this BA from now onwards, BA East since we're looking at, of course, additional acquisitions in this area as well. You will recall that we had a softer-than-expected Q3. We thought at the end of Q2 that it had sort of bottomed out in Finland. That turned out already in July to not be the case, meaning that we had to go back to the drawing board, meaning that we had to take out more cost. And it's been and still is a fight for volume, but we are prioritizing profit before volume, meaning that we de facto have probably lost some market share, but some of the pricing for some projects over there has just been at crazy levels, and we will not contribute to the whole sector going down the drain. So it has been painful. And some entities are really down to the bone chewing, but they're doing a great job.

On top of that, as we've mentioned a few times already, we did one smallish restructuring of one entity in the portfolio. But it really is about profit before volume. Antti and his BUs keep fighting, showing a lot of cease to. It's been a lot of blood, sweat and tears, and it's not over yet, unfortunately. But hopefully, some silver lining in the form of this tax relief that's been implemented as from 1st of January in Finland. So hopefully, the wheels can start spinning again and consumer confidence can be boosted by that. But the war and the neighbor in the East is de facto a main, main issue for that whole market. In the meantime, great to see, of course, the exciting add-on through AJM in Slovenia, providing us with access to Austria and Switzerland as well.

E-commerce, well, Bo and his team proactively turned this BA into a lean and mean machine already in Q1 last year. You will recall that we were off to a slow start within e-commerce, and that meant that we had to review our setup in everything from manufacturing to sales, and that has really kicked in. We took some additional measures in Q3. And I think Q4 really proves that it's all about profitability and growth, but growth in a clever way. So a combination of value-based pricing, a combination of cost control, operational efficiencies across the 3 factories that we have in Estonia, Poland and Romania add to a 55% or 54% profit improvement despite volume being down by 1%. So really, really strong and order intake on top of that looked, of course, very healthy as well. So well done. You have every reason to be proud of what you've achieved.

Last but not least, to complete this BA run through, we go West, and we praise Jonna and her team for a job well done in what is also still a challenging market, a bit patchy across England and Scotland. It was challenging throughout more or less all of 2025 and Q4 was no exception. So a lot of hard work, but with a mixed bag depending on the positioning of our entities and the segments that they are in. So pure trading is trickier in particularly in England, whereas projects and some of the other businesses are more positive. I think the recipe here has been and still is a combo of cost consciousness, mix and thankfully also now very solid contribution from our latest addition, Fast frame. And then, of course, we have high hopes, and it looks good with Victorian Sliders as well, where, as Peter said, we got the capital in before year-end, but we haven't included any profits yet. So that will, of course, be a big plus from Q1 and onwards. Also here, we will rename the BA to BA West and not Western Europe.

To summarize, I think this -- and some of you will have seen this slide before, it's an illustrative way of looking at the building blocks of Inwido's exciting growth journey, talking about both top line and bottom line. And as you can see, we're still eagerly waiting for the anticipated comeback and rebound in both renovation and new build. On top of that, we, of course, are beginning to see something happening around energy efficiency and EPBD is still -- it's not super clear yet. But of course, this is now going to become legislation across all of the EU member states from, I think, it's May and onwards. So we are closely monitoring the developments in each country. And of course, hopefully, at least towards the end of the year, we should be seeing some tailwind from this, particularly as windows and doors are extremely well suited to help house owners improve their energy efficiency.

So overall, I think we are executing our strategy road map, which is a very clear one and a road map that we are committed to. We're doing a great job with it also on the right-hand side here on the profitability levels. And we're definitely stronger as a group today compared to a year ago. So again, we are really ready for whatever 2026 has in store for us. I think we've really been navigating successfully through a lot of headwind, very stable performance overall. It's de facto the third year running of this historic downturn in the industry. We've added pro forma SEK 1 billion in turnover just over the last few months. We have a more lean setup. So at the end of the day, now it's really all about volume. When we get more volume in, not if, but when it happens, we will, of course, be in a really, really good position to also make even more money based on that.

There is a bit of a cultural revolution going on within Inwido, where we have stronger and stronger collaboration in the horizontal dimension, best practice sharing, communication, information sharing, visiting each other's factories, et cetera. We're more engaged than ever and very forward leaning. And last but not least, we also managed to pay back a healthy dividend to our shareholders.

So just to conclude, I recommend, as always, that you pencil these dates into your calendars already now. And again, do visit our brand new website. And with that said, Peter and I would now be delighted to answer any of the questions that you may have, please.

[Operator Instructions] And the first caller here is Jonny Jin from SEB.

Fredrik and Peter, can you hear me?

Yes.

I have a couple of questions. I think I will start with demand. I think you said in the last quarter that you had a strong end to Q3 and now organic growth is back here in Q4, which is good. So can you maybe elaborate how is the momentum entering the new year, would you say? And given your current trajectory, is it fair to assume that this positive organic growth can continue in coming quarters?

It's a relevant question, of course. It is difficult to stick your chin out and say that it's all hunky-dory from here because it's not really. It will be a bumpy ride. It's really large variations between different markets. I have to say, though, that it feels a bit more solid than a year ago. We have the macroeconomic projections and the KPIs to support that, particularly when it comes to Sweden. Let's not forget that Q1 is always the softest quarter for us. And so it's also too early to say that we're out of the doldrums. We've, of course, had a very cold spell across Northern and Continental Europe so far this winter, meaning that some installation work affecting some sales in -- particularly in countries like Finland, which have already been faced with a lot of headwind.

But -- so it's a mixed bag. But overall, irrespective of what happens, I think we have proven now, particularly towards the end of last year that we are in a really good position to maneuver any scenario. We can quickly ramp up where needed, and we can quickly adjust the cost base also when needed. But overall, I think the macro picture looks quite okay. And there is de facto a lot of pent-up demand across a lot of our countries where new build and renovation in particular, is at far too low levels.

Yes. I understand. [ We'll see. ] Then I want to ask a question on the margin. It looks very good here in the quarter despite this unfavorable mix, and I want to understand the drivers a little bit more. So starting on cost side, do you think you can -- do you have more things you can do on the cost side? Or are you now sort of preparing the cost base to meet the higher demand from here? And then on price, I think that you, Fredrik, talked about price on your Capital Markets Day. Is that having any effect already now on profitability? Or how should we view that?

Yes. If we start with the cost side, of course, we can take out more costs if needed. But we -- I think we've done this in a clever way, and it's been really down to each BU to look into what they need to do. The good news is that this is more or less going automatically. The BUs really know what to do and when to push the button. And some of them have, of course, painfully been through this for a couple of quarters, if not years already. But we will never take out too much cost because we need particularly the strategic dimension of the cost base when things start to go northward again.

But if you take -- you can take Finland as an example, I mean, we have entities that have already in the lion's share of 2025 being down to 1 working week, and that's painful. We will, across all of the Finnish operations from 1st of January, actually, so it's already implemented, have for all the white collar staff in Finland, a 4-day working week. So -- and we can do more, of course, if need be. We also did the restructuring that we mentioned a couple of times in Finland, where we shut down one smallish entity, but still, it's really more about profitability than volume, to be honest. And that's where we perhaps have a somewhat different and more of a long-term strategy than many of our peers. So yes, a long response to your question. But yes, we can do more on the cost side if need be. But I have to say, I think we -- it looks quite good overall, the whole group at the moment, and we are in a good spot to make money also if this downturn continues to prevail in some of the markets that we're in.

Pricing-wise, yes. So I mean, pricing-wise, if I start and Peter, you can fill in. I think pricing, at least from a, let's say, theoretical point of view, is a topic that is higher on the agenda and where we have more confidence and where we try it out in entities where pricing may not have been as common or as used as a lever before. And of course, whenever you do try it, you realize that it is a fantastic lever for profitability. So we talk about it. We train our people about it. At the end of the day, you need some ammunition to be successful with pricing as well.

And thankfully, here, we have, in some entities like Elitfonster in Sweden, also been able to launch a couple of new products in the second half of last year. That certainly helps. And even more importantly, the OTIF, the on-time-in-full KPI is generally, I would say, across the whole group at a really, really high level despite challenges in the marketplace. We -- many -- the majority of our entities are at the 98% target level that we strive for on a daily basis. But on top of that, I mean, yes, the pricing impact, I would say, hasn't really -- it's not been a huge difference in the quarter. Maybe, Peter, you can elaborate a bit more on it.

No, I totally agree. But we have -- and actually, in some cases, it's a quite challenging market right now, especially in Finland, where the price is going down. So it's a price pressure in Finland, also in some cases, also in some markets, channels when it comes to U.K. So we don't have any positive gains on pricing in Q4.

Understood. A quick one on the e-commerce business. I think profitability looks good, and we talked about that. But besides cost control, gross margin seems strong there as well. So what drove that, would you say? And can we expect similar cost base in that segment going forward as organic growth is positive now, and it seems like you're gaining some momentum there.

It's really -- yes, it's really, how should I say, a snapshot of the entire group's market situation. We are in a very strong position in our core markets like Scandinavia, in particular, and that certainly helps. I think we've gained market share. We are de facto the only one making money in this field, and now we're making really, really decent money. But some of the newer markets are still new and in that sense costing us [ $1 or $2 ] before they can show decent profitability.

So we want to grow and we see potential here for sure, going forward, but we want the need to grow in a clever way. So we need to digest some of these new markets and let them sink in and learn from each new market before we move on to the other ones. But for sure, organic growth opportunities, lots of price pressure here, though, because it is de facto, as you know, Jonny, our most transparent business where the end customers can in a rather open fashion, compare our offering with some of our peers' offering.

So I think it's more -- it just adds to the fact that we need to have a very lean operational setup, and that's not something that we are fully happy with yet. There is still more work to be done there. We have made quite a few investments into the factories across Estonia, Poland and Romania. And the full impact of that, we haven't seen yet on the operational margin.

Understood. We'll see. Just one final from my side. I think you had on total SEK 26 million in costs classified as items affecting comparability in the quarter. I think you had some SEK 60 million last quarter and SEK 50 million the quarter before that, where I suppose the majority relates to M&A costs. So given your journey that you are on now with more M&A, how should we think about the, I would say, recurringness of these costs going forward?

So we are in -- we have a target to reach SEK 20 billion. To reach the SEK 20 billion, we must do acquisitions. And when we do acquisitions, of course, we have costs connected to those acquisitions, mainly when it comes to due diligence costs. So yes, we are going to have acquisition costs also in '26, '27 and the coming years. We will report them as nonrecurring items because we don't know when they're going to happen, and it's also not really operative. Just to separate, so you can see the operational results and then the acquisition costs. But yes, it's going to be cost in the coming years as well.

When it comes to the full year, in Q4, as I said before, SEK 26 million is nonrecurring costs, whereas SEK 21 million is acquisition costs. For the full year, a little bit more than SEK 60 million in total, whereas a little bit more than SEK 40 million are acquisition costs.

And I think Peter is absolutely right. I think it's -- in absolute terms, yes, maybe a higher level than where we've been at before, but it's linked to the pace that we're at. Relatively speaking, it's rather small amount given the fact that we've added SEK 1 billion now over -- in turnover over the last 4 months. And as you recall, when it comes to the cost that we highlighted for Q2 and Q3, well, they were rather extraordinary and where we didn't get any bang for the buck because we were quite unlucky with 2 processes that we've talked about. And they were really complex transactions as well. So we had an unusually high fee that we needed to pay to primarily tax advisers.

So it will vary a little bit depending on what kind of deals we do and when we do them. But as Peter said, we, of course, will face some charges here if we're going to continue to do acquisitions, which is definitely the ambition that we have.

And the next call is Linus Alentun from Nordea.

Can you hear me?

Linus, yes, we can hear you.

Just a few couple of questions from me here. Firstly, on the Scandinavian margin here, it declined somewhat from 17.1% to 16.4% despite stronger sales. And I was just wondering here if we strip out FX and mix effect and assume normalized conditions there, what do you view as a realistic margin for this segment ahead?

The main reason why the margin declined in Q4 this year compared to last year is due to the mix, not due to the mix between the consumer product, more mix between the different business units, especially in the markets Denmark compared to Sweden. Sweden has been growing more. Denmark has been more stable. We have higher margins in Denmark compared to Sweden, and thereby, we are dilutive in the quarter due to the growth in Sweden compared to Denmark.

So going forward, it depends, of course, how the market will develop, where will the growth be. And during this quarter have been growth more in Sweden. So the question is more in '26 and forward, where will the growth be in Sweden and/or in Denmark?

Okay. Super. And next, just a question here about Finland. I mean you're winding down Finluft, but you said -- but Finland as a whole still remains pretty challenging. I mean the margin is still pretty low. So I'm just wondering at what point do you reassess the Finland footprint rather than incremental restructuring? What would need to happen to consider exiting or significantly downsizing here and really reallocate the capital to higher return markets or M&A, for example?

Yes. I think it's, first of all, worth bearing in mind that it's not that long ago that the Finnish entities were the stars of the Inwido Group. So historically also when we've seen a rather rapid downfall in the market, we've also historically seen a rather rapid bounce back. So we just need 1 or 2 triggers and then hopefully, something start -- yes, the whole market starts to look more shiny again. And because also the levels that we're at, where the whole industry is at are just not sustainable. So of course, at some stage, something will happen.

When it comes to our portfolio and our decision-making, where that is literally, I wouldn't say on a daily basis. But of course, we have -- with the governance model that Inwido has, we have at least formally a reason on a quarterly basis, if not a monthly basis to review the portfolio and above all, look into what measures we are taking. But I am super confident and rather pleased with the job and the work that Antti and his team are doing. It's a very, very, very painful situation that we're facing. And given that, I think we have actually fared better than the rest of the market, and we are not going into silly pricing. So yes, we've lost some market share, but we retain our margins where we can retain our margins.

So we are -- yes, the problem is that we so far haven't really seen any major dialogue at the government level in Finland compared to what we've seen in Sweden. But these tax measures that I mentioned is a sort of a step in the right direction. I'm sure more will come at some stage. Right now, we don't really have any reason to restructure the portfolio more than what we've already done. But again, it's something that we revisit, I would say, on a monthly basis, to be honest. The most important part is that we see the movement and that we take actions where we can take actions. And that, again, I'm very confident and rather pleased about what I'm seeing there.

All right. Moving on to M&A here. I'm just wondering here about the time line -- about the pipeline. You said in the CMD here that it's very strong. I'm just wondering about the sun protection area here, which you listed as promising. Do we have any of those in the pipeline? Or how can we think about that area going forward?

Yes. It's been a clear ambition from us, from me to enter that field in a bigger and better way. We, as you know, have already one entity in Finland, Artic-Kaihdin that we acquired 1.5 years ago. Smallish entity, but -- and a bit of a [ litmus ] test for us in this field, which is -- and Linus, it's solar shading, not some protection. I got this wrong myself. Some protection, somebody kindly reminded me is more the sunblock Hawaiian Tropic kind of products. We're not into that.

It's solar shading. And -- but again, this is a field where we see synergy potential on the sales side because our end customers are increasingly asking for solar shading in different forms and shapes when they also buy windows and doors from us, partly linked to global warming. And this is, of course, a movement that we see has already happened and is still happening if you move further down South in Europe, where a lot of window and door manufacturers also offer some kind of solar shading solution. The profitability in this field can vary a bit from one entity to another.

But if you look at some of the incumbents, it's not uncommon for them to have profitability in the 20% plus area, which is, of course, very attractive for us. That would be -- and that's even without synergies then -- there could be some synergies on the cost side as well. But I think primarily, it will be on the sales side. So we're looking for -- we are actively looking for incumbents in both existing and new markets that would offer us a new platform from which we could grow further and learn.

So to answer your question, yes, we have a few assets of that nature on the growth list that we are in a dialogue with. Again, a lot of these companies are family-owned, second, third-generation. They are making a healthy profit since many years back, not necessarily for sale, but some are. And we have to be ready to pay up a little bit more. So as I mentioned earlier, probably towards the higher end of the 5 to 7x EBITDA. But again, I'm more than willing to do that because it would add a new leg for Inwido to stand on. It would offer a brand-new growth horizon. You could envisage that you split the 2030 target that we have that in 2030, maybe some 10% of our total sales would be within solar shading, which to me would be very exciting.

That is exciting. Just one last question from me here on raw materials. I've noticed that aluminum prices have increased quite a bit here during the past year. I mean your product portfolio spans PVC, wood and aluminum frames. So I'm just wondering here about the aluminum exposure. And does rising aluminum here create an advantage for PVC focused products? Or how do you expect this to play out?

It is -- aluminum is, of course, an important product for us, but it's not the most important product for us. First of all, it is glass then comes wood, then comes PVC profiles and then comes aluminum. Aluminum, we don't have so much pure aluminum windows. We have it somewhat in Finland as one unit, and we also have some sales in U.K. where it's pure aluminum. When it comes to aluminum windows, it's more that we have as a water coat on the outside of the wood windows. So it's not -- it has an impact of us, of course, the price development, but not as big as the other materials.

And we will now go on to the next caller who is Sofia Sorling from DNB Carnegie.

Sofia here from DNB Carnegie. Can you hear me now?

Yes. Now we can hear you.

Perfect. Okay. So my first question is related to the Western Europe business area. So you mentioned in the report that you continue to see very tough markets in the U.K. but still you have very high profitability in this Western Europe. And also it's quite not that volatile if you compare it to other business areas. So could you just explain this? Should we understand it that perhaps orders from the Sidey Group is holding up sales and profitability right now, but that might come down into 2026? Or how do -- how should we think about the communication about the weak U.K. market?

The weak U.K. market is mainly connected to England and the consumer market, where we can see the decline, both in the order intake and sales as well as profitability. The Scottish market when it comes to Sidey, not selling to consumer markets or the product market, that is doing well both in Q4, the order intake is below last year in the quarter due to that they took these large orders. But in general, latest 12 months development or latest 24 months development and sales development and profitability, they are doing well and holding up. So the comment is more connected to England and the consumer market in England where it is challenging.

Okay. A follow-up question then. Do you see a larger risk that like Scotland will not hold up later on? Or do you see like a more chance and potential that you see more positive for example from the Victorian Window House Group (sic) [ Victorian House Window Group ] in 2026? Like is there a larger risk ahead or a larger potential do you think?

I would say, a larger potential actually. I mean, Scotland as a market is, of course, competitive and to that extent, challenging, but it's also quite solid. Social housing, which is the field that Sidey Group, our 2 companies there have a lot of exposure towards is solid and quite buoyant. But it's, of course, not the only thing that we do within Sidey Group. They do -- they cover other parts of the market demand as well. And in England, as Peter said, it's more patchy. But I think the acquisition of Fast Frame is a good example of an entity that we really want and where you can obviously make money if you have a strong and unique position in the marketplace in your niche and in some cases, also in your geographic area.

You must not forget that England is very regional stroke local. So it depends quite a lot on where you are in the country and what kind of position and what kind of brand you have there. Victorian Sliders will, for sure, add to the overall strong portfolio that we have. But it is a mixed bag at the moment. The entities that we have that are more facing the consumer side, the trading part of the business are struggling, and it's been, in that sense, a deterioration in the second half of last year than compared to the first half.

But we -- I mean, as an example, we are continuing to look at additional acquisition targets in the U.K. as well. We believe in the market long run. And in fact, it can be quite a good time and timing-wise to get into that market even further. It's a super fragmented market. And it's a lot happening, huge consolidation, which is just actually for us and some of the others, just beneficial, painful, but beneficial in the long run.

Okay. And I actually had just a final question. It's related to the e-commerce business area. So obviously, it has been quite volatile in the margin profile in this business area and it has improved significantly in Q4 versus Q3, for example. But how should we think about this margin ahead? Would you say that this is definitely like a one-time high margin in Q4? Or do you expect a more of a stable margin profile in line with perhaps not this level, but what is your expectation here in this business model basically?

I think near to medium term, we have a 10% target, which I think is achievable. I don't think one should see it as a one-off. It's a lot of hard work and I think quite an achievement to get to where they are today in this last quarter. They have a better, more clear setup. They are working with pricing in a different way compared to before. It will, for sure, be a bumpy ride. Mix will have an impact. New markets will initially add to the cost and not necessarily be profit generating from day 1. But in the long run, of course, we want to extend the -- and expand the geographic footprint we have.

But overall, they are in a better position strategically and cost-wise, better prepared for what's to come. As I said, it's a super competitive market. Already in 2024, we were the only ones making a profit compared to our peers. And I'm sure that situation has been even more clearly intensified in 2025.

Thank you. And that was all the questions we had for today. So I now hand over the word to you, Fredrik, for some final remarks here.

Thank you very much. It's a wrap. Thank you, Peter. Thanks, everyone, out there for attending. I would also like to take this opportunity to thank all of my Inwido coworkers and our business partners for a job well done. Together, we're already embracing an exciting 2026. So buckle up and enjoy the ride. Cheers and bye for now.

Hello, and welcome to today's broadcast with Inwido. We have President and CEO, Fredrik Meuller and CFO and Deputy CEO, Peter Welin, who will present the report for the third quarter of 2025. [Operator Instructions]

And with that said, I hand over the word to you, guys.

Thank you very much. Good morning, everyone, and welcome to this webcast covering Inwido's third quarter of 2025. My name is Fredrik Meuller. I'm the President and CEO of Inwido since April 2024, and I am joined here in Stockholm today by Peter Welin, our group CFO and Deputy CEO. As usual, we will go through some of the highlights of the group's performance, first of all, and then dig into the detailed financials. We will have a BA run through and finish off with a summary, outlook and of course, a Q&A session.

As usual, you will find the material available also on Inwido's website. So let's get right into it, and we will start with the quarterly highlights at group level. And this is a slide you're, of course, familiar with. I do hope, though, that you can see that we've added 2 sites since the last quarter. They are Vimmerby in Småland, Sweden, and Nottingham in the U.K., of course, very much linked to the two transactions that we have done over the last month. We'll get back to those in a minute.

Inwido is otherwise leading in Europe, of course. Still, we have lots of white spots on the map, meaning that we have huge growth potential, both organically and through acquisitions going forward. I think the exposure that we have is rather unique and particularly important as a strong feature in times like these ones that we are currently experiencing.

If we look at the quarter and the highlights, it was really a quarter with 2 phases, where July, in particular, started off on a rather soft fashion. August was a little bit better and primarily September was a nice rebound. So we finished off the quarter in a much better fashion than we started it on -- so there is a silver lining there. I would also highlight that we saw a lot of variations between our different markets.

Sweden is one of the brightest spots improving quite a lot at last. We have been waiting for that recovery and it's, of course, also from very low levels. So that was promising. Finland, in turn, was a rather negative surprise to us. We said already in Q2 that Finland had bottomed out. That's what we thought then, that we really couldn't get any lower, but it did. So Finland is a bit of a disappointment in the quarter. And it just goes to show that it's a very tough market now at new all-time low levels.

So overall, the much anticipated and much needed consumer demand recovery was slower than we had planned for, particularly again in the market of Finland. Sales were flat. Order intake up slightly, very much linked to our project business. Order book also up a bit. Our GM1 margin is quite okay, linked to price increases that we've been able to push through, rather stable raw material side, but we have been affected and hampered by less favorable mix geographically and segment-wise, and we've suffered from a stronger Swedish krona.

So the main issue is really gross margin, too, with the productivity and staffing basically hampered by lack of volume. Having said that, I'm overall quite pleased with the cost control that we have. It's really lack of volume and the soft market, that's the main problem. So once again, certain entities have been forced to cut deeper into their cost base, that's frustrating. It's painful. And it takes some time before we see the full impact of it.

I want to say though, I mean, I do note that the fundamentals for this business remain rather intact and overall quite positive. There's a lot of pent-up renovation and new build demand that needs to be covered at some stage. And that demand is just growing. On top of that, of course, we are expecting energy efficiency legislation to come through across all of the EU early next year in the form of the EPBD directive being implemented.

M&A is more important for us. Our hard work is thankfully paying off, but we've also been a bit unlucky with one larger process also this quarter. I'll get back to that later on. We've done 2 excellent deals. There's more to come, and I do remain rather optimistic about our M&A going forward.

So looking into a snapshot of the Q3 key financials relative to the same quarter last year. We can see that the lower order intake that we experienced already in Q2 pushed through to us lacking volume in this quarter. And again, particularly in Finland, we were simply not prepared for it. So we had too high of a cost base, something that we've been forced to manage with throughout the remainder of the quarter. And we've had an adverse mix geography-wise and segment-wise with more project sales than consumer sales. Last but not least, our EBITDA was hit by an SEK 8 million of FX from a stronger Swedish krona.

From the BAs, Scandinavia and e-commerce were the main contributors this quarter and the other two faced much tougher market conditions. On the positive side, we have a strong cash flow yet again, lower gearing yet again, and that offers comfort for us in turbulent times, but it also enables us to have a very solid war chest for the M&A going forward.

Adding the first 6 months of the year, we get the full 9 months year-to-date performance, and I have to say it's been a bit of a mental roller coaster ride, low visibility in the marketplace, lots of geopolitical unrest and erratic consumer behavior. But again, I think our broad exposure, our financial strength certainly helps. We performed better than our peers. We gained share. We're seen as a flight to safety. I'm overall proud of our performance.

I think it's important with a reminder that we are all in all in 12 different markets, all of them with unique features and at different stages of the cycle. Variations between the markets were very clear in Q3 between and also even within some of our business areas. Scandinavia, again, quite okay as a market. Sweden is growing, albeit from low levels. But certainly, the government incentive schemes, the ROT-avdrag, and a lower interest rate has had and is having a positive impact on households overall.

Although the ROT-avdrag will most likely disappear in its current form at the end of this year, which is a bit of a surprise to me that the government is taking that measure, but that's my personal opinion. The market will still benefit from easing up of mortgage -- yes, the mortgage rules and regulations, hopefully also giving a positive push to the real estate market, which is an important KPI and an important trigger for Inwido and our window and door business.

Continuing on Scandinavia, Denmark, quite solid. I mean, consumer confidence has taken a bit of a hit this year over the last few months linked very much to the Novo Nordisk volatility, which has had a big impact on the country as such. But overall, we remain positive about Denmark, and we see the current turbulence, if you like, as more of a one-off that will soon disappear. Norway is not deteriorating any longer. It has bottomed out, we think and hope, and we are doing quite well in Norway, given the circumstances.

Moving on to Eastern Europe. I mentioned it a couple of times already. I will mention it even more times later on. It is challenging. Finland surprised us on the negative side across the whole line with consumer demand being very soft. Same pattern in Poland. And I do think that we, in Sweden, sometimes underestimate the negative impact that the whole Russia-Ukraine situation is having on these countries. I visited both of them recently. And it's just a wet blanket that is over the entire economy.

And unfortunately, in Finland, we're not really seeing the same government discussions about supporting the construction industry, one way or another, that we are, for example, seeing in Sweden and where in Sweden has had a positive impact. We're not really seeing the same in Finland, meaning that it will most likely be tough for some time still.

E-commerce is also still in a bit of a waiting mode. Sweden is one positive exception, though. In fact, e-trade in Sweden in August was the best August ever. And that has, of course, had a positive impact on us as well.

Last but not least, Western Europe, a bit of a mixed bag. Ireland remains solid for us and solid as a country in market. U.K., much more difficult, particularly England with low consumer confidence, structural issues, high inflation, high unemployment and hopefully, the labor government can turn things around. That's very much needed. So generally, we see that plenty of our smaller peers are struggling in the current marketplace. We have gained share. Sweden and Elitfönster, there is only one example. We are perceived as a flight to safety, partly because we are also -- we have a strong balance sheet, but also they very much appreciate our high on-time and full delivery position.

A few words about mergers and acquisitions. We've closed 2 acquisitions over the last month, which is very pleasing, 2 nice ones. And since there is, of course, much less organic tailwind than we had expected from the market, more acquisitions are needed, relatively speaking, for Inwido to meet its long-term growth targets. And again, thankfully, our hard efforts are starting to pay off. We work in a very structured fashion. We have added resources. We're also working with external advisers in a larger scale.

And I think these 2 deals exemplify very much what we are looking for in terms of features. They meet our desired criteria and our culture very well. But they have been lengthy processes. Just as an example, RM Snickerier in Sweden took us 9 months to complete from start to finish. It's a structured auction process that we won, very nice business, complementary to our Sweden offering with its premium Allmoge products. Fast Frame in the U.K. is also an important add-on to our Dekko business unit in the U.K. with lots of potential for sales and cost synergies.

So hopefully, this is the beginning of a string of pearls that we've been talking about and working on. The pipeline looks promising. And it's a good mix, again, of existing and new markets, but also of medium-sized to larger ones. We are, of course, happy with the 2 ones that we have done now, but we need to do bigger deals as well, and that's thankfully something that we have in our funnel.

I want to mention already now that we have -- we were involved in one larger process actually started early in 2025, where it was a structured auction process. It actually would have been for us a totally new geographic market more into Central Europe, a sizable deal, where we won the auction, but it was a very problematic process because of the sell side. And in the very, very last minute early in September, if I recall correctly, the seller for emotional reasons, decided to pull the process. We were about to sign.

And at the very last minute, we got a negative message, painful, but it goes to show that the market sentiment is, first of all, having also a negative impact on M&A in that sense. It's more complex. It takes longer time than expected. But even more importantly, the emotional dimension of parting with your business one cannot really underestimate. And that's always really tricky for us to manage. We are sympathetic about it, but it's sometimes quite painful when something like this happens where we were just about to put income paper.

So you will see a note about this in the financial report, where we've taken a hit on our EPS, for example, due to M&A transaction costs. Thankfully, we have others that we are working on that also look very promising. And on this one that I just mentioned, we have not closed any doors. It may well be that, that one bounces back at some stage. But whether that would happen in 1 month's time or in 3 years' time, I cannot say, of course.

Moving on to sustainability. I keep saying it every quarter, but I'm very happy to do so. I'm genuinely impressed and proud of our efforts within this field. It is important not only for Inwido and its shareholders, but also for the stakeholders around us and very much appreciated by our customers. It's a natural part of our DNA. It's a multifaceted approach going all the way from energy efficiency, to health and safety, to R&D, very much exemplified by the pictures and the messages on this slide.

We're getting a lot of credit for this from external business partners, where they really perceive us as best-in-class. Worth mentioning is, of course, also Elitfönster got an award last week in Sweden by Optimera as the best supplier of the year partly because of their groundbreaking work within the field of sustainability. So it's yet another quarter of really strong KPI development across the whole board, I would say, pleasing to see.

Now for more flavor on Inwido's consolidated Q3 financials, I will hand over to you, Peter, please.

Thank you so much, Fredrik. Starting with this page, the income statement. To the left, you can see the Q3 in the middle, you can see the development year-to-date and this year as well as last year and to right you can see the rolling 12 months as well as full year of 2024.

Starting with the quarter. Sales was down by 2% compared to last year. The organic sales growth was plus 0.2% or plus SEK 5 million compared to last year, so slightly growth when it comes to organic sales. The gross margin declined from 27.1% to 25.9%, mainly due to the mix that Fredrik was also talking about. Consumer sales was down by 5% in the quarter, whereas the product sales was up by 2%. And we also had different months within a quarter with a slow start in July and August and then September was improved compared to last year.

Due to the lower gross margins and due to the mix in the quarter, gross operating EBITDA margin declined from 13.4% to 12% and the operating EBITDA declined from SEK 304 million to SEK 268 million. Then in the quarter, we had restructuring costs, mainly acquisition cost of SEK 60 million, and we also had a negative FX impact of SEK 8 million in the quarter when comparing the currency to last year.

Further on income statement, we can see that profit after tax was down by 18% as well as earnings per share was also down by 18% from SEK 3.23 to SEK 2.65. Looking at the year-to-date, January to September, sales is plus 2%, organically is plus 4% compared to last year due to the higher sales growth in the beginning of the year. The gross margin now declined from 25.3% to 24.9% due to development in Q3 and operating EBITDA margin also declined from 10.2% to 9.8%.

The profit after tax as well as earnings per share is slightly down compared to last year, it's minus 2%, mainly the earning per share has declined from SEK 6.12 to SEK 6.00. So rolling 12 months, Inwido has sales just below SEK 9 billion, SEK 8.985 billion, with an operating EBITDA margin of 10.4% and earnings per share of SEK 9.16.

This page is showing the sales development to the left and operating EBITDA development to the right in Q3 last year to Q3 this year, so you can see the development per business area. In general, most of our business units as well as our production units have planned for higher sales growth in the quarter compared to last year, especially within the consumer market. Due to we had a high growth in -- or good growth end of last year when it comes to order intake and also beginning of this year and then came Q2 with a little order intake. And that impacted the sales and the performance in July and August.

We have taken actions and thereby September was on the same level as last year. The consumer market is mainly declining within Eastern Europe due to Finland. In Eastern Europe, the sales of consumers was down by 70% in the quarter, and Western Europe due to U.K. where sales was down by 21% compared to last year. We see a growth in Sweden, and we see growth in Ireland when it comes to consumer sales.

E-commerce has made cost savings. And even though the sales declined in the quarter, the operating EBITDA was slightly improved due to cost savings taken beginning of this year, and also focus on pricing. So they have improved their gross margin in the quarter compared to last year.

This page is showing sales as well as operating EBITDA margin in the third quarter from 2019 until 2025. And as you can see, we have a lower margin this year compared to previous years due to the mix and also due to the lower volumes, especially in July and August, wherein September was on the same level as last year. And we have a mix impact of 5% in the second quarter when it comes to consumer sales.

When it comes to cash flows, the cash flow has also declined. The cash flows before financial activities, excluding financial assets and acquisitions of subsidiaries, was down by SEK 60 million compared to last year due to lower cash flows from operating activities. That was down by SEK 85 million compared to last year, mainly due to a lower operating EBITDA and also due to acquisition costs as well as tax payments.

The tax payments was higher this year in Q3 compared to last year, was SEK 58 million this year compared to SEK 11 million last year. And we have a timing issue. Year-to-date, the tax payment is more or less on the same level as last year. Working capital is stable, minor changes when it comes to working capital. And then when it comes to CapEx, we have lower CapEx this year compared to last year, but that will increase in the coming periods, but still a positive cash flow generation.

And looking at the cash flow generation and then looking at our net debt, this page is showing the net debt as well as net debt in relation to operating EBITDA, excluding as well as including IFRS 16. And as you can see, we have a seasonality when it comes to our cash flows and the net debt. The net debt is always the lowest point in Q4 because then we have low activities and working capital is at lower level. Then in Q1, the market started to increase, and we increased the working capital. And in Q2, we pay out the dividend. So the net debt always increases in Q1 and Q2. And then in Q3 and Q4, the net debt declines because we had generated cash flows in the second half of the year.

Same pattern as this year. The Q3, we had a positive cash flow generations and the net debt declined by SEK 225 million in the quarter compared to end of July. And we have a lower net debt of SEK 247 million compared to September last year. And we also have right now a lower net debt compared to December of 2024.

The net debt at end of September is SEK 1.272 billion and that includes IFRS 16 loan of SEK 466 million as well as acquisition debt of SEK 387 million, meaning the net debt related to bank loans minus the cash is now down to SEK 419 million. Looking at net debt versus EBITDA, we are today on 1.0, including IFRS 16 was 1.2 in September last year. And excluding IFRS 16, is 0.7 compared to 0.9 last year. So Inwido has good headroom for further growth, and we have reduced the gearing.

Another natural target of Inwido is return on operating capital. Return on operating capital is defined as average operating capital in relation -- sorry, EBITDA in relation to average operating capital and EBITDA declined in the quarter due to lower operating EBITDA and also due to acquisition costs. And thereby, the return of capital declined in the quarter to 12.7%, even though the operating capital also declined. So we have a negative development in the quarter due to lower operating EBITDA and also due to the acquisition costs.

And this page is showing the order backlog development to the left and also showing the order intake to the right. The order backlog is plus 5% compared to September of last year. Project is plus 9%, whereas consumer is minus 3%, indicating a negative mix in the coming periods. Looking at the order intake. The total order intake -- organic order intake was plus 1% compared to last year, where we have a positive project growth of 6% compared to last year, mainly driven by Scotland. We have taken some large orders in Scotland, where the consumer market declined also in Q3, minus 2%. We see a decline in U.K. and we see a decline in -- a continual decline in Finland. We have a positive growth in Scandinavia due to Sweden. And the e-commerce is slightly lower compared to last year, where then we also focused on profitability.

I'll now hand over back to Fredrik.

Thank you very much, Peter. We will now look into our 4 business areas in more detail, and we will start with the Scandinavia. As mentioned before, Sweden is at last improving, primarily on the consumer side. And as mentioned, Elitfönster, our larger entity, has gained share. Denmark remains solid. It's been a little bit turbulent over the last few months, but we remain positive on Denmark, also in the near to medium to long term. And Norway has turned corner. Sales are up a bit overall and the order intake is flattish.

Ironically, the flip side of Sweden improving is that the mix impact is negative on the BA as such. We still suffer from unabsorbed costs also in this BA. Overall, we have lost 20%, 30% of volume since 2019, and that's painful. Having said that, we have invested quite a lot into this BA and into the group overall with capital expenditures, et cetera. And so we are in a nice position when volumes do return. And here again, we've had an excellent add-on now in the form of RM Snickerier that will add value to Inwido as from Q4.

Moving on to Eastern Europe. As we stated in Q2, as I mentioned, that it had bottomed out in Finland, that did not hold true, contrary to our expectations, declined sharply in July. It improved a little bit later on, but July was really, really soft and caught us by surprise, meaning that Finland overall is at an all-time low, and we are once again forced to take additional cost alignment measures, literally taking people out, which is painful.

Here we have lost some 20% volume since 2019, but we do have entities that have lost 50%, 60% of their volume. They're down to the bone chewing. We have still done better than the market. We may have lost some share lately because we go for profitability before volume. And we've had an adverse mix, again, consumer being lower, which is quite painful, of course. I will not exclude additional restructuring here. We are, of course, looking at the portfolio across all of Inwido, as you know, and Eastern Europe is not an exception.

E-commerce, I'm quite proud of their performance in the quarter. They lost volume. And as you recall, they had a tough start to the year already in Q1, forcing them to take some corrective measures. Those have had an impact, and there's added to that additional very solid cost control and value-based pricing that has improved the margin for BA e-commerce throughout the quarter. ETrade, as such, though is still quite at a low level and rather flattish in development. Sweden is a positive exception.

So it's really purely a volume game. We do have a solid order backlog that gives us comfort, and we are now in a more lean operational setup, which is also improving profitability here. And I want to remind everyone that all of our peers in this field were loss-making last year, and I'm sure that situation has not improved this year.

Last but not least, Western Europe. The macro reading in England is not improving. Households are rather depressed, and we hope and think that the additional measures from the government will be taking to improve conditions over there, but it's really, really tough. Sales are affected for us, and there's a lot of margin pressure. We are, however, proudly walking away from silly pricing. We take the long-term perspective, and we are further adjusting our unabsorbed fixed costs here.

There's a difference, of course, between Scotland and England, Scotland, where we have our Sidey Group performing still well and the project business is doing better and Sidey Group has continued to boost our overall order intake and backlog also in this quarter. Ireland remains stable and quite buoyant where we have very fine entity called Carlson, and they celebrated recently their 30-year anniversary. We're seeing in England that more and more businesses do come up for sale, a lot of them are in financial distress, but there are, as seen by our Fast Frame acquisition, certain gems out there as well. And thankfully, they are attracted by the Inwido model, and I think the Fast Frame transaction set a good example for what we want to do.

So let's wrap up our key messages from today's Q3 report. Yes, recovery is slower than anticipated, but we finished Q3 on a positive note with Sweden, in particular, improving together with Ireland. There are lots of variations across our markets and across our segments, highlighting the importance of local presence, highlighting the importance of broad coverage. And this is, of course, exactly what Inwido is all about. So volume and mix FX were hampering our profitability. We are adjusting costs where needed. We are prioritizing profit and above all, we are very, very active in the M&A field and the outlook is rather promising here, I would say.

Again, the fundamentals of the business remain strong. There's lots of pent-up demand, and energy efficiency is definitely getting there and the tide can turn quite quickly in this business. Inwido is standing firm. We get comfort from our backlog. We get comfort from our leading positions in the marketplace. And above all, we get comfort from our strong balance sheet. And last but not least, to further boost our strategy execution overall, Ulrika just joined my management team, making it even stronger. So welcome Ulrika to Inwido. As usual, do pencil in these days into your calendars already now and particularly don't miss our Capital Markets Day here in Stockholm later in December.

Now Peter and I would be delighted to answer any of the questions that you may have. So please go ahead.

[Operator Instructions]

And the first question here is the cell phone number that ends with 690. You have the word.

Can you hear me?

Yes, we hear you.

Jonny here from SEB. Fredrik and Peter, I have a couple of questions. Starting with demand and outlook. I think you mentioned stronger sales and order intake here in September. But I also think you have similar reasoning in your Q2 with a stronger end to the quarter as well. Can you elaborate here a little bit more what happened? And the stronger September you mentioned, is it mainly the consumer sales that drove that higher momentum? That's my first question.

What happened in Q3 was that we had a positive end of Q2 with order intake. Still, the backlog was a little slightly down, and then the order intake started to decline in July and August. And then there was a little bit -- it was positive in September, not fully compensating the July and August and then especially related to England as well as Finland.

When it comes to September this year, yes, the order intake was improved in September compared to last year. We had a positive growth in Sweden. There was a positive growth in Denmark. But Denmark, we had a decline in July and August, but then we had a little bit of catch up in September. And Sweden, we had small growth in July and could contain in August and not contain it in September. But still a negative development when it comes to Finland and U.K.

Okay. But given the current trajectory that you're on now, is it fair to assume that positive organic growth can continue here in coming quarters?

It's very hard to say because we thought that when we came out of June starting July, that now we see a positive trend because the Q2 started weak and was improved in the quarter. And then July and August came a little bit of a surprise for us. So we thought we could read the cards in end of June, beginning of July and then the cards changed again in July and August. So it's a little bit hard to say. But we can say that order backlog end of September is we have a slightly negative mix impact.

We have a lower order backlog of consumers and higher backlog of projects and that indicates that Q4 will have also negative mix impact when comparing to Q4 last year. We should also remember that Q4 of last year was quite okay, especially consumer sales. The consumer market started to recover already in Q2 2024. And then we had a positive growth within the consumer markets, also in U.K., also in Finland, up until November. And then in November, the U.K. market started to decline. We had continued positive growth when it comes to order intake in Sweden, Denmark and in Finland up until February, March, April and then the Finnish market started to decline in March, April.

So we had a good order intake in Q4 on most markets. It was only England that had declined starting in November. So we are not comparing to a good Q4 in that sense. So it's a little bit hard to say exactly if it's going to be -- to have continued growth or not continued growth. It depends on consumer complex what's going to happen now during the next coming weeks.

Okay. We will see. But I think you mentioned somewhat growth in Denmark in September. So I mean, given that I assume that consumer is coming up a little bit. So I mean the mix headwind can be less of a magnitude in Q4, although it's still there year-on-year.

Yes. Denmark had a growth. Consumer market had growth in September. July and August was below last year. And in total, the Q3 Denmark was more or less on the same levels last year, the order intake.

Okay. And then moving on to CapEx. I have a quick question there. I think you said that the CapEx is going to come up here the coming period and quarters. And given that Vetlanda factory is almost done now, what is driving this would you say?

We've taken quite a large initiatives when it comes to both capacity improvements, but also efficiency improvements within several factories. So we have taken quite large decisions during the last months, quarters, and that will have an impact in Q4.

When it comes to CapEx, most of the CapEx are most larger in machinery installments, they are done in Q4, in November, December, when we are entering low season and as well as January, February. So we normally push that to the winter season where we have less work in the factories just to reduce the risks. So our CapEx level is always the highest in end of the year and beginning of the year.

And we have taken quite large decisions, both when it comes to Denmark, we've taken some decisions. And we've also taken some decisions when it comes to some factories in Sweden. When it comes to Vetlanda, that will be implemented starting this year as well as in Finland, we also took a decision last year, which is a quite feasible investment.

So we are continuing to make investments. And looking at our investments in the past, we have been running about 3% of sales. Then during the COVID, it was reduced. And what I'm saying that we have to compensate the lower levels during COVID. So we should calculate between 3.5% and 4% in the next coming years.

Okay. But given your efficiency investments to take it, when can we expect to see gains from that, would you say?

That will then be second half of 2016 (sic) [ 2026 ].

Okay. And then final from my side on the M&A. I mean, we're, obviously, again, a little bit of a larger M&A related cost here on the transaction side that was canceled in the quarter. And I believe you had a similar effect in Q1. So I suppose this is the second transaction that was canceled within the 2 quarters you had. I mean what does this mean for your M&A opportunities going forward, would you say? Have you lost momentum, given that there's been a lot of resource and time on this? Or are you still optimistic that you can close maybe some larger deals here in the coming 6 to 12 months?

It was, as I said earlier, a bit painful once again to be a bit unlucky in the very last minute, and it's costing us a buck or two as well. The good news is that, we are, of course, not standing and falling with one deal only. We are working on a number of transactions in parallel, we have to. And again, the mix of them and the features of these transactions and discussions, they're overall very positive, I would say. And I have to say, over the last month or so, we've seen an uptick in activity overall where quite a few new discussions have also popped up. Not everything coming our way is of interest, but quite a few are.

So we have ramped up resources. We did that earlier in the year. We are also working even more closely with some external advisers to help us out, particularly in totally new geographic markets, more into Central Europe. But these processes are complex. They are bit more lengthy than usual because of the nature of the market conditions at the moment and because of, I'd say, above all the emotional dimension of these discussions. Again, the one that we lost in the very last minute was a good example of that.

But again, the door is not closed. It may well come back at some stage. And it was really not due to Inwido in any way, not due to price or us running the process in a bad way. On the contrary, it was really just "emotions." The founder, 70 years old, no obvious successor. But in the very last minute thinking that, yes, maybe I'll just continue with this for another while. Let's see what happens sort of and there's nothing really we can do about that. We just have to take it on the chin and move on and work on the other ones.

And again, I'm quite optimistic about what we're seeing here. We are above all working in a structured way. We have a war chest that is rather impressive. I mean, as we said, in previous quarters already, we could acquire the equivalent turnover of, say, SEK 4 billion with our existing loan facilities without having to ask the capital markets for more money or without breaking covenants or anything like that. So that puts us in a very neat position.

We are still quite picky. We're monitoring a lot of the markets out in Europe quite closely, also now with the EPBD directive being implemented to see what markets we prefer and not prefer. But yes, we've been a bit unlucky so far this year, but that can, of course, quickly change as well.

Okay. But will you say that within the 6 and 12 months there coming forward, I mean, could you still -- is it fair to say that you're still optimistic that you can close a little bit, 1 or 2 larger deals there as well?

Absolutely. I would definitely echo that. And I mean, I'm no stupid, I understand that doing deals in the SEK 70 million turnover category won't take us that much faster to the 2030 target. So thankfully, we have other cases in the pipeline as well. Having said that, these 2 add-ons were really, really neat, strong brand names, excellent performance, excellent management team and with a profitability well above the Inwido average. So we like to do those as well.

Okay, clear. We will follow-up on that, but that was all for me.

Thanks a lot, Jonny. Good questions.

Thanks so much for the questions there. We will now go in and let the next caller in here and he is the person that has the cell phone number that ends with 497. You're welcome. You have the floor.

It's Linus from Nordea here. Just a quick couple of questions here from me. You mentioned underabsorbed cost here from the expected stronger recovery in Finland, U.K. I was just wondering have you now rightsized the cost base here ahead of Q4?

Again, we were taken by surprise already in July. So we were geared up for a bit of an uptick early in Q3, given where we came out at the end of Q2. Unfortunately, that didn't really happen. And so we've been quite negatively affected across all of Finland, all of our Finnish entities, some worse than others, meaning that we went back to the Inwido model and the experience that we have to just pull the reins and take measures painful as it may be, but everyone knows the drill. And it takes a while before that gets into full impact. So impact, of course, started to get in towards the end of the quarter. Is that enough? No, probably not.

But we're in a much better position, of course, now early in Q4 than we were just a few months ago. But as I said earlier, we will need to revisit the overall portfolio that we have in BA Eastern Europe. We're doing that at the moment. And let's see, there may be additional restructuring required, similar to what we did in the U.K. late last year. At the same time, I have full faith in the team that we have on the ground and they're doing a great job given the circumstances. There are certainly other peers out there that are facing much tougher time than we are. But, yes, I wouldn't exclude additional cost correcting measures to be taken.

Okay. And just a question on the gross margin decline. Maybe particular here in Scandinavia where it was driven by the geographical mix tilted more towards Sweden. Do you see any changes to this mix in the last pickup period here of the quarter? And what's expected in Q4, given the current order mix.

So looking at the order intake within Scandinavia, Sweden is positive and Norway is declining and Denmark is stable compared to last year. So in that sense and also look at the same when it comes to order backlog, that we have a higher backlog coming to Sweden, Denmark is stable. That will mean that we then go into Q4 with a negative mix when it comes to the different markets. So we have higher margins and higher gross profit -- or gross margin within Denmark compared to Sweden.

Okay. And just one last question here on the 2030 target, given limited organic growth tailwinds here, what do you expect the split to be here in the coming years to hit that target between M&A and organic growth?

I mean first of all, I mean it's a relevant question. We're counting our way backwards from that target in 2030, we need to grow by a CAGR of, say, 15% from now on. That's a sizable number. When you asked me a year ago, I'd say the split was supposed to be right down and there roughly 50-50 organic vis-a-vis acquisitive growth. Today, of course, relatively speaking, we need more M&A, and we need it sooner rather than later. We need more sizable M&A, and all of that is exactly what we're working on. So it's difficult to say a number.

But in the near term, out of the 15% CAGR, 10%-plus will have to come from M&A. And thankfully, we have discussions and targets in the pipeline funnel that are everything from SEK 300 million to SEK 2 billion in turnover. So I remain quite optimistic about M&A in the near to medium term, and I still fundamentally believe in the 2030 target.

Okay. That's interesting. Can you give any number on the size of the failed acquisition, the size?

That was roughly in the EUR 50 million turnover bracket.

Thank you so much for the questions there. We'll now carry on with some questions that have been sent to us. Could you elaborate on costs in Q3 related to the layoffs in Finland?

In Finland, we have more short-term working with the temporary layoffs. So we are running the factories on less production days. Actually, one factory was more or less only running instead of 5 working days, we're working in the factories on 2 days. And the whole month on 7 days. So it's more like we're working with temporary layoffs in Finland. And then we have taken some other cost initiatives when it comes to Finland, we have taken down some other costs, not so much when it comes to layoffs.

I know you have talked a little bit about it already, but what was spent on M&A in Q3?

The tilt of restructures in Q3 was SEK 16 million and we're up about SEK 14 million -- SEK 13 million was connected to acquisition costs. And the main part of that acquisition cost was the acquisition that was not taking place, as Fredrik was mentioned about.

And the last question here. Is there more one-off coming in Q4?

Well, I guess, the nature of one-offs is that you don't really know when they're coming. So that's charming anyway. I would hope that we have more transaction costs, of course, also in Q4. Let's see the magnitude of those. But we are working on M&A, of course, so there should be and will be some costs related to it. Apart from that, it would be more extraordinary in the form of restructuring in one shape or another. And I can't really comment on that at this stage.

We are reviewing entity by entity. Some are doing really well. Some are having a tougher time. That's the nature of Inwido's portfolio, where we de facto now have 36 window and door companies. Not all stars will be aligned at the same time. So we've had a reason and have a reason to look into restructuring in a closer fashion, and that would be the only thing that I can sort of foresee at this stage. But I cannot be unfortunately more concrete than that at this stage.

Thank you so much. That was all the questions we had. So I now want to hand over to you guys for some closing remarks.

Okay. Thank you very much, and thank you, Peter. Thanks, everyone, out there for attending this webcast. I'd also like to take this opportunity to thank all of our Inwido's employees and business partners for a job really well done. Together, we are weathering this storm in a very good way. Thank you very much, and a great day, everyone.