Garo (GARO) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 were SEK 265 million (MSEK 264.8), down 9% year-over-year, with Electrification stable and E-mobility down 28%.

• Adjusted EBIT improved to SEK 0.4 million (MSEK 0.4) from negative SEK 7 million (MSEK -6.7), despite SEK 2.9 million in settlement costs for the former CEO.

• Leadership team strengthened with new COO, CTO, and CHRO roles to drive integration, innovation, and talent development.

• Early signs of recovery in housing-related segments and stable demand in public, commercial, and renovation sectors.

• Net income reached MSEK 0.3, a turnaround from a loss of MSEK -8.1 in Q1 2024.

Financial highlights

• Net sales: SEK 265 million (MSEK 264.8), a 9% decline year-over-year.

• Adjusted EBIT: SEK 0.4 million (MSEK 0.4), margin 0.1% (-2.7% last year), impacted by SEK 2.9 million in settlement costs.

• Net income: MSEK 0.3 (-8.1); EPS: SEK 0.01 (-0.16).

• Cash flow from operating activities after working capital: SEK 0.5 million (MSEK 0.5), up from negative SEK 43.8 million.

• Net debt: SEK 286 million (MSEK 286.0), equity/assets ratio: 51.2%.

Outlook and guidance

• Continued cautious short-term outlook due to market uncertainty, especially in E-mobility.

• Long-term growth drivers in electrification, energy efficiency, and smart infrastructure remain intact.

• Early Q2 trends similar to late Q1, with some impact from fewer working days due to Easter.

• Gradual recovery in Nordic housing construction expected in 2025, supported by lower interest rates and fiscal stimulus.

• Company remains focused on margin improvement and cost control.