Energy Save (ESGR) ABGSC Investor Days summary

Business overview and strategy

• Focuses on air-to-water heat pumps for residential and commercial markets, leveraging a partnership strategy for scalable growth across 29 European countries.

• Production partnerships in China and a new joint venture in Turkey enhance supply chain resilience and market reach.

• Owns an IP platform enabling both ES-branded and OEM offerings, with a new tech stack based on propane refrigerant for improved efficiency and environmental impact.

• Targets key growth markets in Central Europe, Italy, Germany, Benelux, and is exploring entry into the U.S. market.

• Digital tools and a layered control platform support rapid customization and integration for partners.

Market trends and financial performance

• European heat pump market experienced a 47% decline in H1 2024 due to policy and subsidy changes, but signs of recovery are emerging, especially in Germany.

• Subsidy applications for heat pumps in Germany improved by over 100% in late 2024 compared to earlier periods.

• Five-year CAGR of 35% outpaces the market's 27%, with expectations to resume growth as the market recovers.

• Recent quarters saw sales decline, but investments position the company for accelerated growth when the market rebounds, anticipated in 2025.

• Strategic investments include a Turkish factory and strengthened IP, reducing reliance on any single market.

Partnerships and product development

• The Aira OEM partnership is expected to generate SEK 200–400 million in revenue over the first two years, with potential for further growth under a four-year license agreement.

• The company’s tech stack enabled Aira to launch a premium product in under 14 months, demonstrating rapid go-to-market capability.

• Differentiated product and marketing strategies for ES and OEM brands allow coexistence and market expansion.

• Unique selling points include high price-performance ratio, simplified installation, and strong digital support for distributors.

• Ongoing efforts to expand distributor relationships and adapt product offerings to evolving market needs.