Lifco Stock

Welcome to Lifco Q3 Report for 2026. [Operator Instructions] Now I will hand the conference over to CEO, Per Waldemarson; and CFO, Therese Hoffman. Please go ahead.

Thank you, and good morning, everyone, and welcome to the Lifco Q3 2026 Earnings Call. And as usual, we can go in directly to Page #2 in our investor presentation, and we will take a look at the overall development of the Lifco Group. If we start then with the third quarter specifically, we presented a sales growth with 8%, of which acquisition contributed with 6%. Organic growth was 2%, and we had a slight positive impact from currency of 1% in the quarter.

If we go further down to the EBITA, we grew that with 11%. EBITA margin improved to 23.1%, driven by strong margin development in Dental and System Solutions. Profit before tax increased with 18% due to the growth we had in operating profit and lower financial costs. And then if we look at the net profit, it grew with around 10%. And here, I'd just like to highlight that the comparison number for net profit in the quarter was impacted by a lower-than-normal effective tax rate in the third quarter last year, where there was a the reduction in the corporate tax rate in Germany, which resulted in lower deferred tax liabilities.

And this revaluation last year then decreased the tax expenses in the third quarter of 2025 with SEK 63 million. If we then look at operating cash flow, we had a growth of 19% in the quarter. Moving on to the 9-month period, we have increased sales with 8%, where 7% of the growth came from acquisition, 3% organic growth, and we had a negative 2% impact on currencies for the 9-month period. Further down, going into EBITA, we have grown that year-to-date with 10% and profit before tax has increased with 14%. Operating cash flow has grown with 12%.

If we then go into Page #3 and take a deeper look at our different business areas. Starting by the dental area, we are experiencing a stable development overall. And the sales growth is mainly coming from acquisition, both in the quarter and for the 9-month period. The margin continues to improve due to the mix -- the positive mix effect we have where higher-margin companies with unique proprietary products are developing slightly better than our distribution companies.

And I'd like to also once again remind everyone that during the last decade, we have gradually shifted our exposure into more unique proprietary products mainly through acquisition and also from organic developments in this area. If we then go to the Demolition & Tools business area, we have during 2026, had overall a quite stable development, slightly stronger growth in the third quarter in the sales, but margins are negatively impacted by negative mix effects where the market for our demolition robots are a bit weaker than for the attachment side of the business, and that trend has sort of remained throughout the year.

If we go further down to Environmental Technology, we have grown sales and profit and margins for the 9-month period. I'd like to highlight that the more stable development in Q3 mainly has to do with a very strong comparison number and a very strong quarter in the same period last year. Going further to Transportation Products, we have during the first 9 months, grown, thanks to acquisition and organic growth. The development in Q3 was a bit weaker organically, mainly related to weaker market conditions in the U.K., which is the largest country within the Transportation Products area.

And then finally, going into Systems Solutions, we have a strong development in 2026, supported both by acquisition and organic growth, which has led to improved profits and margins. And here, all subdivisions within the area are developing strongly. And I can also highlight after several years of weaker market conditions in Infrastructure Products, we are now experiencing better underlying markets in that segment now for the last few quarters.

I'd also like to mention in the System Solutions area, we have in our quarter report mentioned that a large customer within Contract Manufacturing division, which accounts for approximately 5% of total sales has reduced forecast going into 2027. And the customer has also announced that they have intentions to, in the future, shift purchases to other suppliers outside Europe. And based on the information we have today, which is not complete, we have to highlight that we expect that this will have a negative impact on our System Solutions revenue and earnings in 2027.

I also like to highlight and just give a comment that this is an area within Contract Manufacturing where we saw larger than normal growth during 2024 and 2025. It's been more on a stable high level in '26. And we made strategically the decision quite some time ago not to continue to grow this specific customer further. And we will also, going forward, limit so we don't grow too far in specific customer segments. We can then go further on to Page #4 in our investor presentation. And on this page, we take a much longer-term perspective on Lifco development. And our most important metric is the free cash flow per share after CapEx and only before dividend and acquisition.

This is a measurement that, of course, quarterly can have volatility because cash flow doesn't always linearly grow every quarter. But over long periods of time, it's a very good indication of how we develop. And since our listing in 2014, Lifco has then grown our cash flow per share with 21%. And also, if you look in the more recent period, the growth since 2019, the compounded annual growth rate is 17%. If we then go further into Page #5, we take a quick look at our balance sheet and specifically into our net debt situation. And after closing of Q3 2026, our interest-bearing net debt to EBITDA is at 1x, which is quite low and means that we have plenty of room for further acquisitions.

And speaking of acquisition, we can then go all the way down to the next page at Page 43, where we are basically looking at the acquisitions so far in this year. We have, during 2026 announced -- acquired 8 companies with a total combined turnover of more than SEK 1 billion. I'd like to highlight that we are also in '26, expanding our capacity, both to identify and take care of new acquisitions. And our internal ambition levels are very high. I'd also like to, as always mentioned, that we are very long-term oriented when it comes to acquisitions. And it's more important that we make the right deals rather than being overly stressed in periods of slightly lower deal volumes that we have experienced so far this year.

The activity level is very high, and we have many interesting targets that we are working with, as always, but the timing -- exact timing of when acquisition materializes is very difficult to predict. And we look for highly differentiated niche companies with a long history of high margins, sustainable financial development and we acquired great companies from entrepreneurs and families. And once again, the exact timing on when they are ready to sell to us is difficult to predict.

And that was all from my side. And with that, I'd like to open up for any potential questions. Thank you.

[Operator Instructions] The next question comes from Zino Engdalen Ricciuti from Handelsbanken.

Starting off in Systems Solutions with the customer in contract manufacturing that you highlight. Could you give some more possible flavor to how much do you believe this will impact? Will you -- is it half of the sales base? Or is it that they're just moving incremental volumes?

Thank you, Zino. We still have uncertainty around that, but we take a very cautious approach, and that's also why we would like to mention this in this report, even though we don't have full clarity on how exactly this will develop. So we have to come back around that. But we want -- it's serious enough to highlight it in this quarterly report. And exactly the timing effect of it is very hard to predict today.

Understood. Just a follow-up, do you believe that this is a result of you strategically limiting the growth that you've been willing to have to this company?

Yes, it's very difficult to say. But I think this is a very special situation for Lifco during the last 25 years. We have not had this type of situation. And we are normally working in very stable situations where we gradually grow step-by-step with our customers. So it's not something that we normally do. And of course, given the growth that has taken place, it could, of course, have an impact. But we take also here a very long-term look at things. And for us, it's important that we have the right type of exposure and right type of segments that we operate in. So we are not a company that can go for super high volume type of -- on manufacturing. .

Understood. And moving to the comments you made about seeing growth in the infrastructure products. Do you make any sort of, I would say, read across when you think about the appetite for demolition robots in the Demolition & Tools segment?

I think the only -- it's quite difficult to understand. We know that we are keeping our market shares and why the market is a bit more depressed. The only explanation I can logically think about is that it has more impact on the geopolitical uncertainty, what happened earlier this year with -- in the Middle East and so forth has more impacted on the sentiment on the buying of more expensive equipment in that area. That's still the explanation that we have been able to identify, but there's no clear -- we see also, of course, in that segment that the aftermarket is developing in well, which is a strong signal. But the exact -- once again, the exact timing of the CapEx investments for our customers is more difficult to predict. .

Understood. And lastly for me on Transportation Products. Sorry if I missed your explanation, but could you give some more flavor as to the lower margin despite by the higher sales and how we should think about that going forward?

Yes. But there we have a combination of organic and acquisitions that are blending out. But we saw in this quarter a weaker development organically in our U.K. operations. So that's the main comment for that area.

Yes. And you expect that to be -- of course, the U.K. market generally isn't doing great, but it's so to say sticking.

Sorry, can you repeat that question, sorry?

Yes. And U.K. generally isn't performing great, it's fair to assume that it's something we should see this margin -- something we should see ahead as well.

Well, that's difficult for me to predict. But we have -- in all business areas, we have a little bit different exposures in different type of companies. But we saw in this quarter some more reluctancy of investments in the transportation area in the U.K. .

The next question comes from Ope Otaniyi from Goldman Sachs. [Operator Instructions] The next question comes from Johan Lönnqvist Sundén from DNB Carnegie.

Just a follow-up for me on the contract manufacturing side. Is there -- do you see any risk that there could be other clients following the specific client that you're highlighting in the report to kind of terminate the business with you? Or is it solely isolated to this specific one.

I mean this is a very special situation. So it's -- in the other areas in Contract Manufacturing, we have a very different type of customer exposure and segment exposure. So this is -- I would say it's really one-off in that situation.

And the margins on the volumes that is at risk, ballpark, where would you say those are?

Yes. We don't communicate specific margins on specific customer relationships. But in general, I can say that the margins in contract manufacturing is, as you can imagine, slightly lower than the average for the Systems Solutions area. .

So above or below 20%.

I'm not going to give a specific margin, but it's -- we can also see from when we grew in the area in the time of growth that we had negative mix effect from the growth in '24 and '25, and this is partly related to what we experienced now. .

I understand.

That's as much information I feel I can give out.

Yes. And anything with Demolition & Tools to highlight the kind of client discussions, sentiment, what you saw after summer.

I think in general -- sorry, you talked about Demolition & Tools, yes?

Yes.

No, in general, if we take a little bit step back and look at the last 4 years, we saw the sharp decline following the heydays after COVID. We saw the sharp decline in '23, '24 and then '25, a comeback year. And that comeback has gone slowly in the right directory for the majority of the business in Demolition & Tools and then with the exception of demolition robot being more CapEx intensive, mainly sold also to smaller contractors. So I think that has an impact. But overall, it's been going in the right direction, not dramatically, but step by step the last, I would say, last 12 to 18 months.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Yes. So we thank everyone for listening in and wish everyone a good continued day. Thank you.

Welcome to Lifco Q2 Report for 2026. [Operator Instructions] Now I will hand the conference over to CEO Per Waldemarson, and CFO, Thérese Hoffman. Please go ahead.

Good morning, and welcome to the Lifco Q2 presentation, and we can start, as always, by going into Page #2 in our investor presentation. And if we look at the second quarter, we are presenting a solid quarter overall with sales growth of 11%. And in this second quarter, we had organic growth of around 5%. Acquisitions contributed with around 7%, and we had a slight negative minor effect from currencies.

If we go further down, we grew the EBITDA with 14% and obviously, margin increased then from 22.5% in last year's quarter to 23.1%, which is a combination of organic development and also some effect of higher-margin acquisitions coming into the group. And also the profit before tax, net profit grew healthy with 18%. Operating cash flow with 14% and earnings per share also grew with 18%.

If we look at the first 6 month period, we -- after a little bit weaker start to the year, we grew in the first 6 months now with a stronger second quarter with 7% EBITA in sales -- EBITA grew with 10%. I can also go back and just mention the 7% sales growth in the first 6 months, it's also -- it's a 3% organic development and 7% from acquisition and obviously, a higher negative impact of 3% in the first 6 months. For the 6 months, we grow profit before tax and net profit with around 13%.

With that, we can go into Page #3, the following slide and look into the different business areas. And just to remind everyone, we have now -- this is now the first quarter where we have splitted out 2 business areas. So we have Environmental Technology and Transportation Products, which have been previously subdivisions under Systems Solutions, they are now sort of separated out. And the System Solutions that we refer to in this page is now the remaining part of Systems Solutions or the [ previous ] solutions.

But going back to the first area, Dental, we are reporting also here solid numbers, growing in the second quarter with 5% and profit growing with EBITA growing with 10%, obviously, higher margin here which is a combination of higher-margin acquisitions coming into play and also some continued effect of positive product mix that we saw in the first quarter. And positive product mix in this area means that typically means that our own manufactured or our own products are gradually taking a bigger share of the Dental business area. Going back 15 years ago, we were only a distribution business. We still have those companies in the group, but we have gradually slowly over the last 15 years, step-by-step went more into own proprietary products.

If we go to the second area, Demolition & Tools, I would say the second quarter was overall quite stable. Sales grew with 2% and profit with 3% of stable margins here. If you take the full -- the first 6 months figures in Demolition & Tools after the first quarter, we had for that period, a negative mix effect where which we also covered in our report that demolition robots had a more difficult market conditions, especially in the first quarter, which have an impact on our margins. As a slightly lower margins for the first 6 months in Demolition & Tools. But overall, the second quarter was quite stable and in line with previous years.

If we then go into Environmental Technology, we have quite good organic growth, leading to improved net sales of 10% in the second quarter. And the growth also translates into operational leverage and higher margins. So we grew the EBITA with 17% in Environmental Technology. In Transportation Products, the next area, we have a combination of acquisitions that are contributing and also strong organic growth in the second quarter. So we grew sales with 22% and profit or EBITA in this case with 26%, also with higher margins.

And I'd like to make a general comment when it comes to many of our industrial companies, they had in 2025, it was probably the most difficult years for the industrial side of Lifco in the last -- at least since the IPO in 2014. And this first half year has been a little bit of a comeback situation more to normality in 2026. It doesn't mean that everything is perfect, but at least we -- the suffering we had in 2025 is at least now a bit better numbers and beneficiation for many of the companies in 2026.

If we go to the last area, the System Solution, which is now remaining 3 divisions. It's our Contract Manufacturing, our Infrastructure Products and our Special Products. Here, we had in the second quarter, also a strong growth of 19%, also growing profit more, 23% growth in EBITA, which is a combination of acquisitions and also organic growth in the segment. Overall, I would say, in most areas, quite stable and good development.

So we can then go into Page #4, which is the following slide, and that's just a slide that we take very seriously because it's measuring the most important thing, our growth in cash flow per share. And once again, the way we measure cash flow per share and this is the cash flow after CapEx and taxes and interest and everything. The only thing that is not included is dividends to shareholders and payments for acquisitions. So it's a pure cash flow of the operations in our view. And since the IPO in 2014, we have grown the cash flow per share with around 20% CAGR, also improving slightly in this year. Of course, cash flow can vary quite heavily between quarters, and you have to look at this in a very long-term perspective.

We can go in then to Page #5 and look a little bit more into our financial position. We have a stable situation. We actually have a lower net debt-to-EBITDA of 1.8x EBITDA, it was 1.9x a year ago. And that's the net debt, including all the option debt and also the leasing liabilities. If you look at the pure interest-bearing net debt to EBITDA, it's also down from 1.3x last year to 1.2x this year. And then this, as I normally say, this also leads to plenty of room for further acquisitions.

And we are, as always, continue to increase our capacity, our way of finding great companies in many different geographies and different subsectors, and that work is continuing step by step. However, as I always say, the timing and how and when the acquisition materialize, can vary and will vary within quarters and even 6-month period. So we continue and have many interesting discussions as always ongoing. And the timing is always difficult to predict as we are extremely focused on buying really good companies for a reasonable valuation.

And with that, we can move a bit further down to Page #13 which is a little bit lifting the high-level picture of Lifco again. I just want to remind everyone how we work and also especially give a huge credit to the entire Lifco team and all the great people that are working around Lifco. This is a slide that we've had for many years, describing how we work. And before we even get to this page, everything starts with selecting highly differentiated companies to acquire that have a sustainable business model and very interesting subsectors that we believe can be interested to develop over long periods of time in the future.

And then the second point is that we have a very good team of senior experienced former or current managing directors in our subsidiaries. that gradually take the coordination role and the cultural leadership role in all our different subsidiaries that we have. And the job of these people are -- is the most important job is to recruit and coach new MDs into each -- at every subsidiary. So we have a potential for very good growth of these highly differentiated companies.

And then obviously, we come into this slide, and then we -- number 1 is that we have to have very motivated managers and we work very hard to ensure we have that. And once we have them and the coaching has taken place, we let great people have a lot of responsibility in different subsidiaries. And we've seen over now several decades that they can lead to very good results, both in terms of growth and margins.

The second point here is extremely important for us. As I mentioned, we focused on highly differentiated companies, and we try to make them even more differentiated over time. We focus on customers and product areas. Where there is a potential for sustainable profit growth. And we also are willing to sacrifice situations where there is more competition or where we cannot be as special as we want to be. And there, we sometimes shrink out of these segments and continue focusing on the areas where we can make the biggest difference. And I'd like to emphasize how important this is in the decentralized model like Lifco an industrial conglomerate like us, it's very, very important that we focus on areas where we can make a huge difference and not going into segments where volume is the only way to make margin. And that's very important for us.

And then we have a situation where we can have these decentralized models and really work efficiently and have very simple, efficient and entrepreneurial companies. And we try to have in each and every company, a very strong focus on sales, on product development and assembly. And these type of -- the people are doing this job should be the shining stars in our model and not have a [ brokers ] level in between. We try to outsource as much as we possibly can, which leads to an asset-light business group. Most of the companies required, they're already outsourced from day 1. If they have some in-sourcing, we try to over a decade step-by-step make them more efficient.

The focus that, that creates is very important because we can spend more time in the company, developing new products that are better and more value for customers, you can also think more about how to do global sales expansion of the products that we have developed instead of focusing too much on what machinery that is going to be installed in the production. And then we have a very strong focus on cash flow. We have different measures to implement that and also incentives in the system for that. And maybe the last point, the most important, we are doing this as a multi-decade project. So we don't -- even though we focus very much on the profits every month, we also invest step-by-step in activities to create long-term growth in all our companies.

So with that, I would like to open up for any questions. Thank you very much.

[Operator Instructions] The next question comes from Opeyemi Otaniyi from Goldman Sachs.

Maybe 3 from my end. Firstly, on Systems Solutions at least based on how it was previously reported, growth was quite solid across the 3 segments. Do you mind just sort of giving a bit more detail on what's driving that? And maybe what's driving Environmental Technology and then the various subsegments.

Secondly, on Demolition & Tools sort of gross -- organic growth seems to be sort of low single digit. Could you kind of go through how that trended versus expectations and sort of forward-looking outlook for the rest of the year?

And then just lastly, on mix, margin seems to be positively surprised. Can you just go through Dental has had sort of positive mix for a few quarters now. So anything surprising there? And also maybe the same question for Demolition & Tools just because, again, mix is a headwind to margins. So maybe any thoughts on that?

Thank you. There were quite a number of questions, and I'm not sure I really got all of them, but I'll try my best.

I think the first question was regarding Systems Solutions. And I think for this quarter, it was pretty solid across the board. Maybe I could mention, I don't know if you specifically ask for it, there is a reason we didn't mention for the first time in quite a while, anything about Contract Manufacturing because we had quite stable development over there. And in this specific quarter, when it comes to Contract Manufacturing, we had actually quite good growth -- quite stable development in the areas that had strong growth since now almost 2 years. So that was more of a normal quarter, but other areas had quite good growth in this quarter.

And just to remind everyone, this can vary between quarters depending on how deliveries play out and so forth. But in this quarter, it was pretty good across the board. The question around Demolition & Tools. I think I can only repeat what we said in the last Q2 -- it's been, overall, the Demolition & Tools area peaked around '23 level and then had a very difficult '24. We saw somewhat of a come back in '25. And then we had maybe a bit surprisingly to many observers, a bit weaker start in Q1 2026.

In this quarter, I would say, overall stable. But given the uncertainty in the global economy and especially the areas where we have more CapEx-related products there's still a lot of uncertainty around those areas. And so the machinery sales, for example, we -- although this quarter was quite stable, it's still very difficult to predict what will happen there going forward.

And then the last question was regarding mix effects. If we go specifically into Dental. I think in this first 6 months, we have 2 things that come into play at the same time. We have done some super niche acquisitions in the recent 12 months, that increased our margins. And then we see the general trend that we had for some time that we have a little bit better development in our own product areas in our own proprietary products. On top of that, maybe we haven't had any sort of negative surprises in the last 6 months that also helps the margin. So I think these 3 things play together.

And I guess the mix effect was also referring to Demolition & Tools. And I can only repeat, we have slightly higher margin in our machinery part if you compare to our attachment side. The attachment side has been more stable and developing more positive in the last 6 months. And therefore, we have over the first 6-month period, it a negative mix effect where we had slightly slower development in our higher-margin parts. In the second quarter, it was more stable, but for the first 6-month period.

I don't know if I answered all the questions here, but maybe if you have any follow up, feel free to.

Largely, you largely did. Maybe just one follow-up on Transport Products. Growth there was 22%. I think you've done some in that segment in previous quarters, but sort of was driving quite strong organic growth there?

Well, I would say that last year, I had a general comment here earlier on that 2025 was the most difficult year in more than a decade for our industrial companies, including Transportation Products. And this year, we felt that the markets were a little bit more -- I wouldn't say maybe fully back to normal, but at least more friendly class. So in general, we feel that things are coming back across the board in this year.

But keep in mind that last year was very, very difficult. And the reason maybe just to be very clear, the reason things look on the top line, maybe not as bad last year as it felt was that we had this extra growth from Contract Manufacturing throughout the most part of 2025, but made the numbers a little bit strange. But under the hood, there was a lot of difficult situations in 2025 in many of our industrial exposure. So this first 6 months have been a bit more...

The next question comes from Karl Bokvist from ABG Sundal Collier.

Follow-up there on contract just to understand like if there's anything left, so to say, of those one or fewer larger contracts for lack of better words, that was really supportive. I mean have they now run through their course and now it's just another kind of leg up in general product deliveries and so on? I'm just trying to think about volatility and comparables.

I wouldn't really describe it like that. I think what happened, it's actually now it started, I think, about 2 years ago, the growth in Contract Manufacturing that was very high for a while. And now it's sort of stabilized on a -- maybe not at the peak level that we saw in some -- I can't remember exactly it was 9 or 12 months ago. But it's more stabilizing on a higher level compared to how it was 2 years ago. Specifically in this quarter, as I mentioned before, we saw quite strong growth in many other areas in Contract Manufacturing and more stable development compared to previous year in the areas that sort of took off 2 years ago.

So it was a bit different type of quarter to see. So right now, you can say it's very difficult to predict. But right now, we sort of grinding along in the areas that took off 2 years ago, and we'll see how that develops. And other areas have now at least in this quarter, had a strong momentum, and we'll see how the future develops.

All right. And my second question, correct me if I'm wrong here. But within environmental, would it be fair to assume that the marine side of things is doing well? And then the follow-up would be, I know that you are very agnostic in terms of M&A, but kind of just your view when you assess the marine market for M&A opportunities?

Well, the short answer is that without going into too much specifics, it was, in general, a solid quarter for the environmental areas. So they consist of quite different type of companies, but we saw quite strong growth, including the marine market. But just to keep in mind, the business we have in marine is very much an aftermarket driven business. So it's not an area that even though top line can vary, but from a profit development is very much driven by a stable and continuous growth in aftermarket. So it's not coming only from one area in Environmental Products, the more general increase in this quarter.

The next question comes from Dan Heimer from SEB.

Just 2 follow-ups from my side. Maybe starting a bit on the comment you had about the industrial part of your business that is a little bit better first half here. I know a lot has happened throughout the quarter with geopolitical uncertainty in the beginning of the quarter. Do you see any impact from that increased level of uncertainty in April and then later catch up in June? Or was it sort of even performance throughout the full quarter and quite limited impact from what's happening in the world?

Yes. Difficult question to answer. I think you're right. There's a lot of geopolitical insecurity or instability. But we've sort of got used to that now the last, I would say, 4 years. So I would say this -- maybe I should say this way, this first 6 months has been a bit strange, I don't know if you've seen that in other companies. But I think the difference between months has been the biggest that I've ever seen in the last 20 years. And I cannot really make a good conclusion of that. So there's been intra month, but it's not so clear that has to do with geopolitical wars, et cetera, et cetera.

So I have a hard time making good conclusions. So probably you guys who are following many companies can help me better interpret what has happened in the first 6 months. But just to give a little bit of flavor, it was -- but I think it also has to do with the holiday shifts in Central Europe and so forth. But for example, this quarter, April was okay. May was very weak and June was good. And we saw a similar effect actually in the first quarter, which is a bit strange because you would argue that March is in theory, been a weak quarter given what happened in the Middle East in the beginning or late February, beginning of March. So I have a hard time making very good conclusions around this, but I can only mention that is how it's been looking for us around this.

Yes, fully understood. And maybe on the organic growth in the quarter of 5%, a bit of a catch-up from Q1. I know there's a little bit of different comps in Q1 and Q2. But still in terms of pricing, are you pushing more price increases now when you have a little bit higher transportation cost and fueling prices? Or is it sort of a good mix between volume and pricing in this quarter?

I mean I think if you're referring to extraordinary price increases due to short-term price hikes in the value chain, that takes normally a little bit of time in some companies. But in general, we are -- every year, no matter how the market condition is we are inspiring and we are ensuring that our companies are gradually adapting their pricing and developing better products with higher value for customers step-by-step. So it's a constant work in Lifco.

I think the short-term impact, that could actually be a little bit -- take some time, but some companies can be, of course, very quick depending on the situation, how you work with order books and deliveries, et cetera. But I think in general, so far, it's more of a general grind that took place in this year.

Especially if you compare to how things -- sorry, Dan, but if you compare it to how things were when the inflation really peaked some years ago that it was much more dramatic. Now of course, we are also implementing some extraordinary price increases in specific sectors where raw material has a more clear relevance for us. Other than that, we normally do our normal price adjustment as we go along.

Okay. Very clear. Maybe just finishing on acquisitions. You've done 4 so far this year. Pipeline is at normal levels and you have a lot to work on going into the second half of the year? Or yes, can you just give a few words on that as well?

Yes. We have a lot of things to work on to the second half of the year. But no, it's -- we are very quality oriented, and we try to stay very disciplined. So sometimes, you get a release and everything comes into play and maybe you make 5 deals in 1 month and then suddenly, you make only 4 or 5 deals in 6 months. So that can vary a lot. But if you go under the hood of what's going on, the activity level is -- continues to be extremely high. And of course, higher than ever as it grows every year. So we have more discussions than we ever had, but that's normal for us. We grow a little bit every year in how we look at things.

But everything -- all the stars have to be aligned to make a deal happen. So we have to work -- continue to work very hard. And hopefully, we get some more closings and transaction in the second half, but very difficult to predict. And we should not predict that. I think it's very dangerous to put targets or we should always be willing to walk away if we don't feel comfortable, fully comfortable because when we buy a company, we're going to keep it forever, and it's a big obligation from our side. But the short answer is yes. We are very active in looking for new opportunities.

The next question comes from Gustav Berneblad from Nordea.

Gustav from Nordea. I thought maybe just to come back here to the contract manufacturing part of the business. Just wondering if you are experiencing any sort of worsening component shortage related to your business, particularly, I guess, related to electronics parts or the EMS business. If you could say anything regarding that? And if you have seen any preordering in the quarter as well?

I think we're quite into detail there. But yes, I think there's been -- there is a component difficulties. But we're quite used to that now. In the recent history, we had a situation like this coming quite frequently.

So yes, that is the situation we are handling that quite well. But in some areas, we would like, of course, have quicker deliveries and more supply. But overall, it's not a major problem on the Lifco Group level like this, but this specific situations, yes, that can be a problem.

Okay. Perfect. That's clear. And then just to come back a bit to Demolition & Tools. I mean, it sounds like overall, H1 was a bit weaker, particularly, I guess, Q1. But if we just look at the demolition robots, are you seeing any trend shift in that market? And maybe it sounds a bit better in Q2. Has it sort of increased gradually during the quarter or rather stable throughout?

Yes. I guess you can say first quarter was tough, and it was a bit better in the second quarter. So yes, I think that's a short answer. But we're not -- we're quite far away from a good momentum, especially when it comes to more construction-related use of the machinery.

So that has -- if you compare it to how things were 3 years ago, we're quite far off from that level still. But that doesn't mean that we think that will come in next quarter or even the next 6 months. So we take it as always a very conservative approach on the future. But long term, we hope that one day, things will be very good for this segment as well. We just don't know when.

That's fair. That's fair. And just finally on the Environmental Technology. Maybe you said this before, sorry for that. But just on the margin side, I mean, is there anything that's pushing margins up here? I think it's quite impressive, but -- or should we assume that this is a good reference point also going forward?

I think many of these companies, we have high-margin companies with high margin on product sales and also some of them in aftermarket sales. But when you get organic decline, it's very difficult to protect margins. And vice versa, when you get some positive organic development, it's quite easy to have an operational leverage normally.

So that's -- I think that's the simple explanation that -- we have organizations with product developers and sales force, et cetera, et cetera, and we have a better leverage on those organizations. We tend to get better margins. So that's what we saw in this quarter.

[Operator Instructions] There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. I'd like to thank everyone for dialing in and also for the good questions. And we look forward to continue developing Lifco and see all of you in the next quarter report in October. Thank you very much.

Welcome to Lifco Q1 Report for 2026. [Operator Instructions] Now I will hand the conference over to CEO, Per Waldemarson; and CFO, Therese Hoffman. Please go ahead.

Thank you, and good morning, and welcome to the Lifco Q1 conference call. We can start with moving in directly into slide or Page #2 in our investor presentation and take a look at the overall performance in the quarter. And if we look at Lifco overall, we are presenting a stable quarter with 4% growth in sales, 6% growth in EBITA and 8% growth in net profit.

In the quarter, acquisition contributed with around 8% to our sales growth. We had a negative effect from exchange rates of around 5%. And organically, we grew with around 1% in the quarter. I think here talking about organic growth, we should also take into consideration the record high sales we had in quarter 1 2025 that we now had to meet, and we could not meet those numbers. And that has to be taken into consideration that we are having a decline in our sales in the Contract Manufacturing, which basically means that many companies in our industrial side had a better start to 2026 than the start we had in 2025.

We will come back to that a little bit more later. And we can then move into Page #3 and look into the different areas. If we start with the Dental field, we had overall a stable development in sales and despite the negative foreign exchange rate also there, we have in the quarter a positive mix effect where higher-margin companies with own manufactured products developing stronger than the distribution companies, and this leads to better margins than last year. It's basically a product mix effect.

Also acquisitions that we have carried out during 2025 and early '26 are contributing with slightly better margins. So that's the explanation for the EBITA margin ending up at 23%. If we then go further down to Demolition & Tools, sales was overall stable on the high level for the business area. We have obviously here also a negative foreign exchange effect on the sales levels. So we had a slightly decline of 3.6% overall in sales.

I would like to highlight here. Also here, we had in Q1 2025, very strong margins in this area. In Q1 2026, the current quarter, margin is lower, in particular, due to weak market conditions in our demolition robot segment, which is resulting in a negative product mix in this area.

I would also like to, as I usually do highlight that the margins in this area tends to be quite volatile between quarters. So we have seen that historically. But the key point here is that we had a weaker market development in Demolition & Tools, meaning that it was overall quite stable in sales for the other parts of this segment.

In Systems Solutions, we have, despite also the negative foreign exchange effect, some strong growth of 9% in sales due to acquisitions and organic growth in all subdivisions, except for the Contract Manufacturing that I mentioned previously. And once again, Contract Manufacturing had somewhat of a record quarter 1 year ago. And we have now seen from the last, I would say, 12 months, somewhat weakening from the record levels we had. And this was also the case in Q1 2026. And I can already now mention that, unfortunately, we have limited visibility in this area. So we have to take a cautious approach going further into the year for this segment.

If we go further looking at other segment Systems Solutions, we had a very strong development or strong development in Transportation Products, Environmental Products in the first quarter, which is very nice to see after some, I would say, weaker development during the whole 2025. We had some good starts there. Infrastructure and Special Products had overall stable development, but both of these segments had contribution from acquisitions, making them grow.

So if we just end up the overall picture for Systems Solutions, if we exclude the effect from the volatility in deliveries in Contract Manufacturing, we're very pleased to see that the vast majority of the Systems Solutions companies had a better start of 2026 compared to 2025.

We can then go further into Page #4 and just make a short statement on the information that was presented in our report this morning. We will -- from the next quarter onwards, we will organize ourselves into 5 business areas instead of 3. And this means that Environmental Technology and Transportation Products that has formerly been divisions within Systems Solutions will now be reported as business areas as of the interim report for the second quarter of 2026.

And just a few comments. The change that we now are reporting 5 business areas comes after many years of strong growth in Systems Solutions, both through acquisitions and organic growth. And within Systems Solutions, the 2 divisions that we have currently, Environmental Technology and Transportation Products have become so material that they will reported and monitored internally in a new way.

So we will actually lift them up like this. And just also would like to highlight that the Dental and Demolition & Tools segments will not be affected by this change. And the outcome of this is that Systems Solutions, obviously, going forward will then consist of Contract Manufacturing, Infrastructure Products and Special Products.

And then we can go into Slide #8, and look very briefly at our financial position. And the financial position remains very strong. Interest-bearing net debt to EBITA is at 1.1x, which is the same level as 1 year ago despite a large number of acquisitions during the last 12 months. And total net debt to EBITA is also stable at 1.7x. And in that number, we also include the debt for options, future option payments of minority holdings.

And this financial position means that we have plenty of room to continue doing further acquisitions. We are continuously increasing our capacity to both search and take care of new companies. The inflow of new ideas continues to be high, and I think it's increasing every year. But the exact timing of when acquisition can materialize will be a bit volatile. We have seen that historically, and we continue to see that.

So we are working very hard, but we also remain very disciplined in terms of the quality of the companies we want to bring into Lifco, which is way more important for the next decade than optimizing acquisition short term. So it's always a balancing act in this matter.

And then we can go into Page #23. And given that we will, from next quarter onwards, report Systems Solutions a bit differently with 2 new business areas, I think it would be nice to look at Page 23 now after 11, 12 years as a listed company. At the time of the IPO in 2014, Systems Solutions was a very small part of Lifco with at the time, some low-margin operations that were, to be frank, struggling going into the IPO.

Those original company has done a tremendous job of improving their business, their market positions and their margins. So we have seen some very good organic development. And then on top of that, maybe even more importantly, we have, during the last 11 years, acquired a large number of very strong niche companies into the 5 different subdivisions that we have so far.

Two of those divisions have now developed so strongly that we from next quarter onwards, then we will report them as business areas. And both Transportation and Products and Environmental Products are now areas with close to SEK 1 billion in profits, EBITA and with margins way above 20%.

And as we will look into further on when we start reporting them more gradually from next quarter, you will also learn that we have some -- especially Environmental Technologies, some global market-leading positions in many of those operations. But also the remaining part of Systems Solutions, which means Infrastructure, Special Products and Contract Manufacturing have developed also very well over time and will together form the parts of the remaining Systems Solutions going forward.

So with that final remark, I would like to open up for any questions. Thank you.

[Operator Instructions] The next question comes from Zino Engdalen Ricciuti from Handelsbanken.

I would like to start off in the Demolition & Tools business area. You said now that you've seen some weaker market developments in the quarter. I'm wondering if you could elaborate a bit more on what you're seeing and what the drivers behind the weaker markets are?

Thank you, Zino. Well, if we talk specifically for the quarter, we see a relatively better performance in our attachment side compared to the machinery side, which typically is an indication of sentiment change in the market, meaning that customers are still willing to invest in lower-ticket items, but more hesitant to invest in more expensive CapEx investment for them for the customer perspective.

So that's what we see now. Obviously, the situation has been now for years and continues to be very difficult now with the global situation that we are facing and the uncertainty that continues to be high in this area. So we also see -- if you go back the last 3 years, there's been some volatility up and down in this segment, and it continues the uncertainty, you can say, given the situation we have now in geopolitics, et cetera. So -- but in the quarter, just to be clear, we -- overall sales for the area was quite okay, but the mix effect in this quarter was the key thing.

The next question comes from Dan Heimer from SEB.

A couple of questions from my side. Maybe starting a bit on the motivation to break out Environmental Technology and Transportation Products out of Systems Solutions. I suppose it's more of a way to increase external transparency rather than changing anything on how you operate internally. Is that a correct way to read it here?

Yes. I mean, yes and no, I would say, as you know, you have been following us for quite some years, we have -- we are operating with a number of senior leaders in Lifco that are taking care of the governance of the portfolio companies, and that will not change at all because of this.

So it has partly to do with the external reporting. But also we have to acknowledge that these areas and now looking back, we have now been able to find very interesting add-on opportunities in this area. It's also part of the motivation that we can also internally monitor how we are developing a bit clearer when we report on this. But you're right, it won't change how we operate internally from next quarter onwards. We still use the same type of -- same people will be doing a great job like they've been doing in the past. Yes.

The next question comes from Gustav Berneblad from Nordea.

It's Gustav here from Nordea. I thought maybe just to ask a question here on the margin uplift in Dental if we look year-over-year. Is it possible to give any more color on what is the contribution from previously announced M&A here? Or -- and what is the contribution from the mix effect? And also, I guess you don't want to guide, but is there anything in terms of the mix that points towards a more negative mix going forward?

Well, if you take the first part of the question, we see the effect is strong both organically margin because of the product mix effect and the acquisitions. So it's a combination of both, I would say.

And then you're right, we don't guide going forward. So this is one quarter. Hopefully, we can continue to see increasing margin in the future, but we don't celebrate victory from one good quarter. So time will tell.

But in general, I can -- in this regard, just mention that over the last decade, we have gradually step-by-step increased our exposure to own manufactured products, own proprietary solutions. And we kept our distribution business, and they've been doing a great job in their markets, but the mix effect has been gradually changing like this. So now in this quarter, it became a little bit bigger effect maybe than normally, but that trend has been there for years. And we continue to have a higher appetite for more differentiated type of companies in all areas, but also in Dental.

The next question comes from Zino Engdalen Ricciuti from Handelsbanken.

Yes. One more question from my side. When I'm looking at the tables on Transportation Products and Environmental Technologies, there seems to be some variations in the margin. And I'm wondering if you have anything you want to send our way that could be helpful around how to think about the margins in these business areas.

Can you be a bit more specific? Sorry, [indiscernible] I'm answering the question in a correct way.

Sorry, could you repeat that?

Zino, can you just explain what variation are you referring to just so I can answer it more specifically what you're looking at.

The quarterly variations in the new business areas where you have highlight or shown the EBITA margins on a quarterly basis?

Yes. Okay. No, no. But this is true for -- in general, for Lifco that when it comes to quarterly margins, our companies, they are operating without thinking about the quarters. So that can be varying. And then, of course, in -- then on top of that, you also have some acquisition effects that can come in different quarters as well.

But -- and then in some areas like in Environmental Products technology, for example, we have -- in certain areas, we have some more deliveries with larger size that can also move around between quarters and impact the quarterly margins. But if you look over time and take the annualized situation, then if there is a variation in margin, then it has more to do with if the market has had a more tougher year. Like in 2025, for example, we had a slightly more difficult year for many of our Systems Solutions company, including, I would say, Environmental Technology and Transportation Products. So that's -- but between quarters, it can be volatility. Yes, that's correct.

The next question comes from Dan Heimer from SEB.

Another question as well, maybe touching a bit on Contract Manufacturing, which we have touched upon for many quarters now. But now, of course, have very difficult comparisons. Q2, you had a little bit of easy comparisons. But would you say the level you're at right now on the sales level, is that sort of representable, although I acknowledge that it can vary a bit between quarters here.

It's a very difficult question, Dan, because as you know, we have been -- it went up, I think, summer of '24 and then it sort of peaked first quarter 2025, and then it was a bit up and down or a little bit weaker level in end of '25, and now we're starting a bit weaker. But it's very difficult for us to give a forecast. Maybe we can say that the peak levels that we saw a year ago, we don't expect to see in the next few quarters, basically. Does it mean that it can improve or go down a little bit from where we are now? We don't know. So that's the best estimate we have right now.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Yes. I'd like to thank everyone for listening in, and thank you for the questions, and I wish everyone a nice Friday. Thank you.

Welcome to Lifco Q4 report for 2025. [Operator Instructions] Now I will hand the conference over to CEO, Per Waldemarson; and CFO, Therese Hoffman. Please go ahead.

Thank you, and good morning, and welcome, everyone, to the Q4 2025 earnings call for Lifco. We will start with the overall summary on Page #2 in our presentation. And we can start looking at the quarterly numbers where we can conclude that Lifco Group then had a sales growth of 6%, of which organic growth was 4%, acquisition growth 7%. And then we had, like many others in this quarter, a negative exchange rate effect. In our case, the negative effect was 5% on sales in the quarter.

If we go further down, we had an EBITA growth of 5%, net profit growth of 7%. And in this quarter, we had a strong growth in operating cash flow with an increase of 23%, thanks to our increased results and also some release of working capital. And earnings per share grow in the quarter with 7%.

If we then look at the right-hand side of the graph and take the full year figures, we had a sales growth of 8% in '25, of which organic growth was 4% growth, acquisition contributed with 7% and we had for the full year, a negative exchange rate effect of 4%. EBITA grew for the whole year with 7% and net profit growth was 10%. And also for the full year, we had a solid operating cash flow of growing 11% and our earnings per share grew for the full year numbers with 10%.

And I'd also like to just highlight that the Lifco Board has proposed a dividend of SEK 2.7 per share, which is an increase of last year's SEK 2.4 per share. And this is, of course, a proposal that will be finalized as a decision on the Annual Meeting.

If we then go further to Page #3 in our investor presentation, we can have a little more deeper look at the different business areas. And if we start then with Dental, we had overall a stable underlying organic development during the full year 2025 and also in the last quarter, the same pattern. And for the full year -- sorry, both in the quarter, especially and also for the full year, we had negative effects from currency, which then overall led to a moderate increase in profit of 2% for the full year numbers and 1% in the quarter. So quite stable underlying development in this area.

In Demolition & Tools, we have, we have during the whole 2025, seen a slightly improving market conditions with some organic growth. And this is then following quite difficult year in 2024 when the markets were very weak in most part of the Demolition & Tools area. The organic growth continued also in the last quarter, but was offset by even more negative exchange rate effect when we translate our numbers into Swedish krona.

And during the Q4, we also -- the margin in Dem & Tools was slightly lower than previous year due to some product mix effect. But I would also like to highlight that we had the opposite situation in Q3. And this is an area where we have and has always had some volatility in margin between different quarters, depending on product -- what products are taking a bigger share of the total in the area.

For the full year in 2025, Demolition & Tools grew the EBITA with 9% despite quite strong negative foreign exchange effect and the margin overlook for the full year period increased with 1 percentage point.

If we then go further down and look at our Systems Solutions area, we have now mentioned throughout the year that it's been a somewhat challenging year for many parts of Systems Solutions, especially in the Transportation Products and Special Products area. They have actually faced more difficult market conditions compared to previous years.

And the lower sales volumes in parts of these areas led to slightly lower EBITA margins. If we then talk a little bit about other areas, Infrastructure Products saw some improvements in 2025, both for the full year and in the quarter. And that's thanks to the same trend that we saw in Demolition & Tools a slightly improving construction markets and infrastructure markets making this area coming back organically.

Environmental Products had a stable development through '25. And as you all know, Contract Manufacturing had very strong growth in the first 9 months and a more stable development in the last quarter of 2025. And during the last quarter, Systems Solutions improved EBITA with 10% despite also here a negative foreign exchange, but also, of course, helped by a number of acquisitions that contributed to this growth.

And margin was slightly lower than previous year due to -- also here, we have some negative product mix effects, but areas with slightly lower margin is having a better organic development in this area.

So if we go further to Page #4, we can then take a little bit of a step back and take a look at the longer perspective of Lifco. But before we do that, we can then also give some information on how the EBITA growth for Lifco in 2025 was split.

We had another year with strong contribution from acquisitions of 10% in '25. And as you can see here, we had flat organic EBITA development in -- throughout the year. And this is then mainly due to the weak market conditions in parts of Systems Solutions that has led to lower sales volumes and then shrinking organic profits in some parts of this. And then foreign exchange had a negative impact of 3% for the full year on the EBITA level.

If we then look at the longer time period of Lifco, we can then conclude that for the last 11 years, we have had an average growth from acquisitions of 12% per year. The average organic EBITA growth has been 6%. And I think now we have also had a couple of years with tougher market conditions. So even with those years included in the data, we have been able to grow on average 6% per year throughout the last 11 years.

And if we go further down on this slide, you can see then also the split of the average organic EBITA growth on different business areas. Dental, quite stable development with 1% growth on average per year. Demolition & Tools having a higher growth of 9% per year and Systems Solutions then had on average 11% organic growth over the last 11 years.

And then we can go further into Page #5, also a long-term perspective graph. And here, we can just see that Lifco has grown the EBITA, and now we talk about CAGRs, compounded average growth rates of 18% from 2015 to '25. Earnings per share has grown 16%. Our net debt has actually been -- is lower than at the time of the IPO. So we are now sitting at 1.1 interest-bearing net debt to EBITA. We had a strong growth in operating cash flow. And also, we've been growing our dividends with around 70% CAGR.

Also on this slide, we also list how much we've spent on acquisitions in the years. And also on the bottom of this slide, you can see basically what we paid equivalent to the 100% ownership of the companies that we've taken in, in every year and also the estimated profit impact of the companies that we have acquired in each and every year.

And if you look into details there, you can see that we continue to have -- we're adding high-margin, strong companies, and we're able through our very hard work and very diversified screening of companies all around Europe to find very high-quality companies at fairly reasonable valuations.

If we then go further down to Page #6, which is maybe the most important part, if you take a long-term perspective -- short-term cash flow is, of course, a volatile measurement. It can vary between months and quarters. But if you take a very long-term perspective, cash flow is the best way of measuring the underlying performance of the company and especially when you measure it on the cash flow per share.

And just to clear the data we have here in this slide, we then look at the free cash flow per share after CapEx and after all interest payment, taxes, et cetera. And the only thing we don't include is dividends and acquisitions that we view as more decisions on the Board level, at an annual meeting level.

So if you look at that measurement, we have actually grown cash flow per share with 22% CAGR since Lifco was listed, which basically means 9x higher cash flow per share than back to 2014. So a very strong development here. And this is also a fundamental part of why we're able to continue to grow Lifco from acquisitions without stretching our balance sheet.

If we then go further down to Page #7, we can also see on a more graphical level that our net debt-to-EBITDA ratios are very stable. So you can -- basically, it means that we are using our free cash flow in a stable way to pay dividends and also make acquisitions.

We have net debt -- total net debt, including IFRS and our option debt for future payments, it's 1.7. It's down from 1 year ago. And the interest-bearing net debt-to-EBITDA is 1.1x, which is also down from 1 year ago despite all the acquisitions that we carried out in this year.

And this obviously means that we still have plenty of room to continue our growth journey, both organically and from acquisitions. And I would also like to highlight that our M&A capacity is continuously increasing. We took -- we take every year some steps to develop this, and we did also very good development in our capacity in 2025.

And then we can go all the way down to Page #33 where we just look at the acquisitions that we carried out in '25. And in total, we announced 17 acquisitions with a total estimated sales level of SEK 2.2 billion in combined turnover. And once again, we have acquired in '25, a very good collection of companies. They have high margin, super niche, super specialized and strong positions in their respective niches.

I'd also like to highlight, and this is not new for '25, but in general, when we acquire these super niche strong market companies, we also get very strong profit-oriented company cultures. So we're very happy to welcome these companies into -- to the culture that's matching Lifco in a very good way.

So that's all for me. And then I'd like to open up for any questions. Thank you.

[Operator Instructions] The next question comes from Carl Ragnerstam from Nordea.

It's Carl here from Nordea. A couple of questions from my side. Firstly, looking at the other operating income and expenses in the quarter, SEK 60 million, that is seemingly the highest level in -- ever, I think. What is behind that, you say?

Yes, you're right. It's -- we have not had that situation before, and we can be transparent. And this comes from a fire in one of our subsidiaries that we had some time ago, where we had extra costs, obviously, relating to moving the company and setting the production up. And with that, we have taken part of the insurance money that we received and put that as an operating income -- other operating income. But you can say, for the full year '25, this has not been any positive effect. On the contrary, we've been a bit conservative in our bookings. So this is not material...

And do you expect more to come?

There could be some more, slight more coming in as we took a conservative approach around the full clearance of the insurance claim. Sorry, the majority is '25 issue, yes.

Okay. And then it's Q1, if anything, or...

Difficult to say. But the way to look at this, if you want to be very detailed oriented around this topic is that you can say part of the problems we had in our profit in this company was partly offset by this other operating income.

Okay. That is very clear. On Demolition, you touched a little bit upon the mix and the margin in the quarter surprised me a little bit at least. Obviously, we've seen volatility before. Is it solely the mix you're referring to as less special machinery sold. Or is it any other mixes? And also on that note, have you seen anything related to pricing that could also be one effect on the margin side?

So when we look -- no, it's relating to the mix. And you refer -- I mean, so when we say more -- sell more super niche machinery products, we obviously have slightly higher margin compared to some of the other parts in this. And we had -- so you can basically draw the conclusion that we had slightly higher part of that in Q3 and slightly lower in Q4. And the margin, if you look at individual entities, is we are strong in pricing. So it's not that effect here.

And on the mix side, is it a mix you see in the quarter that could be sustainable over more quarters ahead? Or is it more of a temporary, as we've seen before, Lifco selling a few less machinery of a certain niche?

I think if you look at the full year numbers, we're increasing our margins. If you look at Q3, we had very strong margins compared to previous year. And now we have a little bit the opposite effect in Q4. I think it's way too early to draw any major conclusion around this. And I think we've seen this over -- if you go back over the last 10 years, we had this 1 percentage point margin difference between quarters, I would say, quite normal in this area.

It's on a high level. And we have to look at a little bit longer time periods here to draw more conclusion. The main message for this area is that we saw some comeback in 2025. We're not on booming levels. It's not a heyday that we're seeing at all, but it's coming back from quite depressed situation in '24.

Okay. Very clear. And the final one, if I may, is on Contract Manufacturing. Sorry for bringing that up. I know that you're not super willing to talk to it by a subsidiary or subsegment. But entering Q1, I think comps will be -- I mean, even tougher to some extent. So should we see that you keep this level flat year-over-year? Should we see that also coming up in Q1 here as well? Or I mean, how should we look at the volatility we've seen historically? And also how you manage your procurement with the, I guess, budgets you have for that segment in order to minimize the risk of over or procuring too little.

Well, as I -- we talked about this a few times in the last 15 months here. And we had sort of a hiccup in Q2. In Q3, Q4, we've seen a more stable development. So that's where we stand right now, and that's what we can see right now. So based on that, it looks stable. But as you know, this has changed quite quickly during Q2. So we had temporary slower development in Q2.

But all we can see now is that it's quite stable. And when it comes to the material, I think we had we have -- based on what happened in Q2, we have stepped up in many of our operations in being prepared for this. But of course, if demand changes very quickly, it will have a short-term impact on maybe cash flow and that situation. But we managed that quite well. If you look at how we end up '25, we have very strong cash flow also in this part of the operations.

And as you view 2026 right now, do you see a quite flattish sequential development of this business? Or is it cyclicality we should consider entering '26 in this, I mean, quarterly?

Okay. So if you take the first quarter in '25, we had very strong development last year. But we also have now a quite strong development in -- during the fall, and we're matching our Q4 '24 numbers quite well. So I think that's the best estimate. I can't give you any better estimate than following the trend that we're seeing right now.

And the visibility is maybe in theory, quite longer. But in reality, we saw in Q2 that we had to be very careful in predicting too far ahead in this area. But right now, we see stability. So that's the best guess.

The next question comes from Karl Bokvist from ABG Sundal Collier.

On Dental there, anything worth highlighting in terms of a similar question really on the other segments in terms of mix or anything like that on the margin then?

No, I think in general, in Dental, we have -- maybe I should answer this question here on a more long-term perspective. We have had now for a number of years an increasing trend where we are becoming more and more of a manufacturer, partly due to acquisitions and partly also to the organic development of the companies we have. And I think we saw that trend also in '25 where we had slightly more difficulty in our distribution companies.

They are becoming less and less important part of our profits in this area. And I think that's also the trend we saw in '25. And as I mentioned probably a year ago, hopefully, we are now reaching a point where the sort of transition of Lifco Dental Group into a company with own products and own R&D and unique proprietary products is reaching a point where we can hopefully see some high growth in coming years. But it's too early to say whether that's in this year or it takes another year or so before we're at that point.

And then on the M&A side, in the past, if I look at this correctly now, the past 3 years, the margin of acquired units has been even above 25, and in some cases, even closer to 30. So I understand that is not on its own a focus area for you, but just how far can you go in terms of finding these very high-margin companies and thereby have a clearly still margin accretive effect on the group?

Well, I mean, we don't really look at it like that. Our target is not to get margin-accretive acquisition. Our target is to get really good companies that we can own forever and that are super specialized and they suit the model of having independence within the Lifco Group in a very entrepreneurial and decentralized manner.

And we have learned over the last 20 years that companies with high strong margins over many years and very specialized product offering is very suitable to gradually continue to develop within the Lifco system. So that's why we probably end up having a higher appetite for those type of companies. So whether they have -- but having said that, whether the companies have a margin of 22% or 30%, that's difficult to predict what it will be in the coming years. But -- because we can also accept companies with high margins and not super high margins.

But we tend to really feel more safe about the corporate culture and especially the position of the company when we've seen a long history of high margins so that we don't only see great products, we also see very great execution. So we will see. It's my normal answer to this. We cannot promise that they will always be accretive. And I think maybe that's not so important. The important thing is how we increase our free cash flow per share in a very good way, and they are high-margin companies is one way of doing that.

Yes, sure. And my final one is just on the growth, excluding currency and acquisitions inside Systems. Is it without giving any direct number, but would it be fair to assume that, that number was positive during the second half?

I don't have 6-month figures here in front of me. But I can say that it became better in the last quarter, the growth in Systems Solutions. But we're not -- as I always say, we don't celebrate victory. You have to see some longer-term perspective, but it felt a little bit better in the second half or maybe the last quarter. I don't have the specific 6 months figures in front of me right now, but the feeling we have, and I'm sure about the fourth quarter, it was better. But it was a difficult year in '25, but it's at least if anything, it's a good -- it's better to have a little bit better feeling in Q4, but it's a little bit too early to celebrate victory that the markets are coming back across the line.

Yes. Always nice to be optimistic ahead of a full year.

Yes. Thank you.

The next question comes from Opeyemi Otaniyi from Goldman Sachs.

Maybe just 2. On the others, do you mind sort of going into the other segments in System Solutions, what you're seeing there and maybe margin outlook on the other segments other than Contract Manufacturing?

Excuse me, the line wasn't very good for me there. Can you please repeat that question? Sorry.

Okay. I was just wondering, do you mind going into a bit of detail on the other businesses in System Solutions other than Contract Manufacturing in terms of trends you're seeing there. And then maybe margin outlook and margin contribution from those businesses?

Yes. We don't communicate margins on the divisional levels, but we can give -- I can give you a little bit of a flavor how last year was overall. And as I mentioned, we saw the strongest development, obviously, in Contract Manufacturing, which we've discussed in previous calls. And then we had a stable development in environmental products overall. And then in infrastructure products, we saw, as I mentioned in the call here, we saw throughout the year a slight improvement from a relatively tough '24, and that is a little bit the same trend that you can see in Demolition & Tools area that we -- '24 was a very difficult year for many construction and infrastructure exposed companies.

And '25 then was slightly better. And then if you look at the more difficult areas, it was in Transportation Products and Special Products. And there in Transportation Products, we saw a slight improvement actually from the weak situation we had throughout the year in Q4, whereas in Special Products, it still was not -- we still see some weaker market conditions for some companies also in Q4. So that's basically the summary of the trend in those areas.

Okay. That's very clear. And just on margins, I think in sort of Q3, Q2, you kind of talked that sort of costs were maybe a bit too high in some business areas due to growth investments. When thinking of margins in Q4, sort of any margin improvement driven by sort of those coming out, some of those costs coming out. And so when we look at margins going forward, is there still scope to boost margins by sort of taking cost out as well?

Sorry, the line is not great. Can you please repeat that again? Sorry, I can't really hear you. You were referring to something in Q2, Q3, which I couldn't really hear.

Apologies. Maybe just thinking of margins and cost out. You talked about costs were maybe a bit too high in certain parts of the business and in H1. Is there still scope to take those costs out in H1 this year or that was largely done in H2 last year?

So if you look at our cost reductions in Lifco, they have been -- basically our portfolio companies, they act when they see a change in market demand. So in '24, the majority of our cost reduction, of course, took place in the Demolition & Tools area, where we had a very weak market situation, and they are now improving in '25.

And then in Systems Solutions, obviously, we have companies then addressing the weaker market conditions throughout 2025, especially then in Transportation and Special Products. But having said that, some companies are -- have very high margins and very little fixed cost, so they can do only so much to compensate in this. And others have, of course, more opportunity where you can say, in general, the lower the margin, the more you have to address and more things we can do to fix it.

But in Lifco, it's really -- we are built on a culture where we have very action-oriented managers, and we continuously work very hard on the management level in Lifco to ensure that we have that in all our companies. And they do a really good job in addressing the market situation locally. And that happens immediately. It's not a centralized steering project around this. So I think I can also highlight that I'm very happy about how different managers are executing this in a Lifco way.

So it's not like we sit here with a plan and now Lifco will do this and that, instead, we see continuous things happening in our portfolio companies.

[Operator Instructions] The next question comes from Jakob Marken from Danske Bank.

Just a short one on the demand side. If you can help us to get some understanding of where you see demand picking up. As you spoke about, I mean, how do you see that in the different geographies, North America versus Europe and the rest of the world, if you can help us and especially maybe on the Demolition & Tools part and the Infrastructure part?

Well, I think in Demolition & Tools, we've had now, of course, we are quite -- in all our areas, quite exposed to Europe. Demolition & Tools, of course, a more global exposure than the others. And yes, in 2024, it was especially difficult, I think, in Europe, U.S., North America was holding up a bit better in '24. '25, we have a mixed picture when it comes to North America. We have some areas holding up quite well despite tariffs and the situation there. Whereas others have seen more situation.

We haven't really understood why this is. But -- so it's still possible to grow in North America in '25 for some companies, but not so clear. In Europe, we saw a slight improvement in '25. I think one of the more difficult markets, maybe not so much related to Demolition & Tools, but in general, it was U.K. during 2025. And I can only go historical when I -- I don't give any predictions about how the markets will go going forward. But it's been pretty much -- yes, pretty similar for us around Europe.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. Thank you very much for listening, and thank you for the questions. And I wish everyone a nice Friday. Thank you.

Welcome to Lifco Q3 Report for 2025. [Operator Instructions] Now I will hand the conference over to CEO, Per Waldemarson; and CFO, Thérese Hoffman. Please go ahead.

Thank you very much, and welcome again. We had some technical difficulties, so we will restart the call again. And we start again at Page #2 and look at the overall performance of the Lifco Group. And we can then conclude that the third quarter is a solid quarter despite some difficult market conditions in parts of our business. especially in Systems Solutions. In the third quarter, we grew net sales with 9%, of which 5% was organic growth, 8% growth came from acquisitions, and we had a negative foreign exchange rate effect of 4% in the quarter. EBITA grew with 10% and the margin -- EBITA margin of 22.6% was slightly higher than the same quarter last year.

We have very solid and strong cash flow in the quarter. And then I'd like to highlight when we look at net profit, where we had a growth of 9% that we had an impact of a onetime effect in this quarter where of about SEK 63 million, and this has to do with the revaluation effect on deferred taxes due to a decision in Germany that they will, in year 2028 onwards, gradually lower the German corporate tax rate. So this is a onetime revaluation effect. So there will be no further impact of this tax effect in the coming years until 2028 when we'll see gradual lowering of taxes in Germany.

If you then look at the 9-month period in 2025, we grew our net sales with 9%, of which 4% was organic growth. We had 7% positive impact from acquisitions and then a negative impact of 3% from foreign exchange rates. And then EBITA grew with 7% and margin for 9-month period was 22.2%, which is slightly lower than the year before due to weaker market conditions in parts of our Systems Solutions business, which has led to an organic decline in sales and lower margins in some areas of our business.

We can then go over to Page #3 and look into the different business areas. If we start with Dental, it's overall quite stable development, which is not unusual for this area. So for the full year, we have a small growth in profit and sales. Of course, we also have some negative foreign exchange effects dragging down those numbers. In Q3, we grew the profit with 9% and margins was a bit higher than last year. But I just want to highlight that there could always be variation between quarters, and we've seen that also in historically. So I look more at the full year performance here.

In Demolition & Tools, we have improved organically now in 2025, and this has to do with a quite weak development in '24. So we see a comeback. So this organic growth that we see in '25 also leads us to improve margins because we have a positive operational leverage effect when we have slightly higher volumes. We can also get normally better margins. And the EBITA margin of 25% for 9 months is strong, but I also want to highlight that the market conditions are still not back to the levels we saw a few years back when we had our record years in this business area.

If we go then further down to Systems Solutions, we are growing with 14% for the 9-month period, but margin is slightly lower than previous year at 22.4%. And once again, the main reason for our lower margin is that we are experiencing weaker market conditions throughout this year in some areas, which led to lower organic sales and then slightly lower margins organically in those companies. And this is mainly in our Transportation Products and Special Products subdivisions, but also some other areas we experienced this depending on what situation the companies are in.

And I also want to highlight that our companies, as always, are focusing very hard to now get back the margins to normal levels despite not the perfect market conditions. I just also want to remind everyone that another reason for the lower margin in Systems Solutions for the 9-month period is that we, especially in the beginning of '25, had a very strong organic sales growth in Contract Manufacturing, which is an area with slightly lower margin than the other part of Systems Solutions. So we get sort of a little bit negative mix effect in this year in the numbers.

And then we can go to Page #7 and take a look at our financial position. And our interest-bearing net debt to EBITDA remains at low levels at 1.3x net debt to EBITDA. And this is a number where we -- despite the fact that we have done quite a number of acquisitions this year and have pretty good activity, we are still having a very solid position when it comes to our opportunity to continue doing acquisitions. So we will, as always, continue to look to find attractive opportunities to acquire good companies all around Europe that can contribute to the future development of our group.

And I would like to remind everyone we focus on acquiring very high-margin companies with strong positions in small niches. And we also keep our focus on staying disciplined and finding reasonable valuation. So this is always a difficult task, but we have historically done a good job. Once again, I remind everyone, the timing of acquisition when they materialize it's always difficult to predict, and they will be a bit lumpy. So far in 2025, we have had acquisitions carried out at quite a good level. Also, I want to remind everyone that we are working very hard on continuously developing our organization so that we can do more acquisitions.

Over the last -- past 5 to 7 years, we have grown our capacity to make more acquisitions with around, I would say, 10% every year. And this, of course, is an area we will continue to work very hard in the future so we can continue to develop Lifco step-by-step. And with that comment, I would like to open up if there are any potential questions. Thank you.

[Operator Instructions] The next question comes from Zino Engdalen Ricciuti from Handelsbanken.

I would like to start out in Demolition & Tools. If you can nuance a bit in terms of, so to say, end markets, both in terms of products and geographies.

Yes. So if we start -- thank you for the questions. I think if we start with products, where we see maybe the most clear comeback in this year is obviously where we have the most difficulties last year. It's a typical effect we see that we had a quite difficult situation in 2024, especially when it came to the attachment business. And I think they are now seeing improvement from those low levels.

When it comes to the other areas, the more machinery-based equipment that we sell, it's a more mixed picture in this year, I have to say. We see in some areas quite good development and the other is more difficult development. And that's a little bit more volatile area. Also maybe a little bit an area where for some companies, tariffs can have an impact short term. The more uncertainty in the market makes customers wait, et cetera. So I think that's more on the product side.

When it comes to geography, yes, then you would conclude that based on the first comment that United -- USA business is dropping dramatically this year, it's not really true because we see also a mixed picture. Some companies are still doing quite fine in the U.S. despite tariffs, so they're able to continue, whereas others are having more problems there. And in Europe, I think, the area where we -- in general, and that's maybe not the Demolition & Tools comment, U.K. has been quite difficult, I think, this year in general. Germany has been difficult for a while. That's maybe not a change in this year. So that's basically maybe the markets that stand out. But it's -- yes, that's as much I can mention on this question.

Very, very clear. And jumping into Systems Solutions, 2 questions for me. Firstly, quickly on contract manufacturing, if there are any new comments on how, so to say, your expectations in the quarter that we had from -- and comments from the clients.

Well, yes, as you maybe can read from the numbers, it was a quarter where we sort of matched -- roughly matched to last year when it was starting to pick up. So it's an improvement from Q2, which we indicated also in the last earnings call that it looks a bit better in July. So -- and just a comment on that. So now -- right now, it feels that we're on a stable level compared to previous years when it picked up. But given the uncertainty that we saw also in Q2, we are very careful in making any promises around this area. But you can say so far, so good, basically.

Very clear. And if we look at Systems Solutions adjusted, so to say, for Contract Manufacturing, you highlighted some of the -- maybe the weaker areas. Can you talk a bit about how the momentum in the business area adjusted for Contract Manufacturing feels? Of course, it's varied, but more in general.

Sorry, I couldn't really hear you. You want -- your question was about Contract Manufacturing or the other areas?

No, excluding Contract Manufacturing.

Okay. All right. No, but there is -- I mean, there is a number of things that -- some companies are doing quite well, actually growing -- they have their structural growth and they continue with that in this year. And then we have some companies in the U.K. For example, we -- the companies that are more exposed to U.K., we see more reluctant market in this year. And also, of course, some companies are impacted by tariffs, not in the way that we think we can sell in the future. But we have, for example, if you have a bigger CapEx investment, it seems to be taking a longer time to close deals in the U.S. So we're also impacting from that.

And then I think in some other areas, it's just a general maybe weaker market in the industrial parts of Europe that also impact us. So it's a combination of some companies dropping a little bit more, maybe due to this stop in the U.S. temporarily and then other companies just dropping a little bit because of slightly weaker market conditions in industrial parts of Europe. And then I would say, as I mentioned before, maybe a little bit more in the U.K. exposed business in this year.

And just a follow-up. You mentioned quite a lot now impacts from tariffs. It would just be more interesting to hear more what your feeling is regarding the tariff situation and what the companies need to see for investments to pick up.

No, but it's good that you asked that question because I don't think, in general, we have a huge problem with tariffs. We haven't commented that specifically report, but some specific companies with maybe more higher CapEx investment products they have -- it's a little bit -- takes a bit longer time to get that done because the customers are maybe a little bit reluctant to make a decision because the uncertainty of if tariffs will be removed, et cetera.

But we also have companies in the U.S. where we are actually growing this year. So I think it's -- I don't want to overstate that the problem but a slightly lower margin this year has to do with tariffs. So it's a bit mixed picture for us actually in the tariff situation. So I wouldn't make it too big of a point at this stage for Lifco, even though you have individual companies that are -- there are maybe a few companies that have really, really a decline in the U.S., but it's marginal for Lifco overall. And we have others that are growing quite well despite the fact that they have, of course, increased prices to compensate for tariffs and they're still growing. So it's a mixed picture for us.

[Operator Instructions] There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. Thank you very much for listening. We apologize for the technical issues and hope that it worked anyways. And I wish everyone a good day and eventually a good weekend. Thank you.

The host has ended this call. Goodbye.