Alfa Financial Software (ALFA) CMD 2024 summary

Financial performance and growth

• Achieved strong organic growth from 2017 to 2024, with capital sales up 9% and service sales up 15% over the period, and accelerated growth from 2021 to 2024.

• Adjusted EBITA margin improved to 16.5% (LTM 2024) from 16.1% in 2023, with net income rising to 10.2 BSEK and EPS to 16.67 SEK.

• Order backlog reached 52 BSEK as of September 2024, with 15 BSEK for 2024 delivery and 37 BSEK for 2025 or later.

• Operating cash flow remains robust, with net debt/EBITA at 0.61 and ROCE at 22.8%.

• Financial targets set at 5% growth, 15% adjusted EBITA, and 20% ROCE, with recent averages exceeding these goals.

Strategic priorities and investments

• Focused on massive investments in market leadership for core portfolio, future technologies, and service as a strategic priority.

• M&A activity is aimed at enhancing capabilities rather than pure growth.

• CAPEX program for 2022-2027 totals ~14.5 BSEK, with major investments in energy, food & water, and marine segments.

• Scaling initiatives target the Brazed business, service, technology, China, and India, with a balanced approach to future decisions.

• Growth strategy is structured around three buckets: Evolve (+25% since 2022), Expand (+47%), and Explore (+100%), with CAPEX allocated 45%, 50%, and 5% respectively.

Sustainability and climate targets

• Committed to Net Zero by 2050, with 60% reduction in Scope 1 & 2 emissions by 2025 and 100% by 2030; Scope 3 emissions to be reduced by 50% by 2030.

• Scope 1 & 2 Net Zero targeted for 2027, with investments in solar panels and emission reduction at key sites.

• Product innovation supports circularity and recycling, with new heat exchanger and separator concepts.