FLSmidth (FLS) Q1 2025 earnings summary

Executive summary

• Q1 2025 delivered strong financial results, surpassing expectations with higher-than-expected revenue, especially from services, and leading to an upgraded full-year outlook despite market uncertainty from US tariffs and macroeconomic headwinds.

• Service revenue is the main driver of profitability, with Mining service revenue up 14% year-over-year and order intake in both capital and service segments in line with expectations; areas for growth identified in consumables, pumps, and cyclones.

• Adjusted EBITA/EBITDA margin reached 15.1% in Mining and 13.9% for the group, marking a significant milestone toward becoming a high-quality company.

• Entered exclusive negotiations to divest the Cement business to Pacific Avenue Capital Partners, aiming for a full perimeter sale; non-core activities ceased and contracts integrated into Mining.

• Sustainability initiatives advanced, including significant reductions in greenhouse gas emissions and the launch of new recycling and flotation technologies.

Financial highlights

• Group revenue for Q1 was DKK 4,729m, down 2% year-over-year; order intake declined 12% to DKK 4,629m.

• Gross profit increased 18% to DKK 1,629m, with gross margin up to 34.4% from 28.6% in Q1 2024.

• Adjusted EBITA margin improved to 13.9% (from 9.2%); EBITA margin was 12.6% (from 7.5%).

• Net profit for the group was DKK 351m, up 81% year-over-year; EPS increased to DKK 6.1.

• Free cash flow improved to -DKK 122m from -DKK 306m in Q1 2024; leverage ratio (NIBD/EBITDA) at 0.4x, well below target.

Outlook and guidance

• Full-year 2025 guidance raised: Group revenue ~DKK 19bn, Adjusted EBITA margin 13.0–13.5% (up from 12.5–13.0%), Mining Adjusted EBITA margin 14.0–14.5%; Cement guidance unchanged at 9.0–9.5%.

• Guidance excludes transformation and separation costs (DKK 200m for Group/Mining, DKK 50m for Cement).

• Service order intake expected to remain stable for the year, typically DKK 2.6–2.8bn per quarter.

• Outlook subject to macroeconomic and geopolitical uncertainties, especially tariffs and global demand.

• Cement disposal expected to conclude in coming weeks or months.