BALCO GROUP (BALCO) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 declined by 3% to 316 MSEK, with organic growth at -10% and acquired growth at 8%.

• Adjusted EBITA margin dropped to -0.9% from 5.0% last year, with adjusted EBITA at -3 MSEK versus 16 MSEK.

• Order intake fell to 275 MSEK from 352 MSEK, and order backlog decreased to 1,238 MSEK from 1,392 MSEK.

• Major structural actions included workforce reductions in Finland and Denmark and closure of the Arboga plant, with 31 MSEK in restructuring costs and expected annual savings of 60 MSEK.

• Q1 results were weak due to project delays in Sweden, the UK, and Finland, and a major project deviation in Sweden.

Financial highlights

• Adjusted EBITDA was -3 MSEK (margin -0.9%), down from 60 MSEK last year.

• Adjusted earnings per share were -0.24 SEK, and reported EPS was -1.31 SEK.

• Operating cash flow was 1 MSEK, down from 34 MSEK in Q1 2024.

• Equity at quarter-end was 757 MSEK, with an equity/assets ratio of 47%.

• Interest-bearing net debt/adjusted EBITDA was 4.0x, up from 3.2x.

Outlook and guidance

• Market recovery is expected to be gradual and slower than previously forecast, with continued uncertainty and delays in large projects.

• Q2 and subsequent quarters are expected to be on par with last year, but full-year EBITDA may be slightly below 2024.

• Lower order intake over the past year will impact sales and earnings in coming quarters; focus remains on cost control and selective acquisitions.

• Ongoing investments in sales, markets, and product development continue alongside structural changes.

• Increased customer activity in the renovation segment in Sweden and Norway; slight improvement in Swedish new build market.