Concentric (COIC) investor relations material

Executive summary

• Net sales for Q2 2024 declined by 13% year-over-year to MSEK 955, with minimal FX impact and reduced customer demand, especially for hydraulic products.

• Electric product sales grew 12.7% year-over-year, now representing 23% of total/group sales, up from 18% in Q2 2023.

• A warranty provision of MSEK 100 for a manufacturing defect significantly impacted reported operating income, reducing it to MSEK 24 and margin to 2.5%.

• Alfdex secured major agreements worth MSEK 1,300 in electric separator products for global truck and off-road markets.

• Net income for Q2 was MSEK 9, with basic EPS of SEK 0.25; adjusted EPS before items affecting comparability was SEK 2.47.

Financial highlights

• Operating income before items affecting comparability was MSEK 124, with a margin of 13.0% (down from 16.0%).

• Cash flow from operations reached MSEK 103, with a profit to cash conversion ratio of 137%.

• Net debt at quarter-end was MSEK 777, down from MSEK 950 a year ago; gearing ratio improved to 35%.

• Net debt to EBITDA ratio stands at 1.33; cash and equivalents at MSEK 374 after a MSEK 158 dividend payment.

• Book-to-bill ratio at quarter-end was 89% (down from 99%).

Outlook and guidance

• Q3 net sales are expected to be slightly weaker than Q2, with continued weak end-market demand and challenging conditions across all regions.

• Additional cost-saving measures are being implemented to maintain margins.

• Strategic focus remains on accelerating electrification and securing new business opportunities.