HMS Networks (HMS) CMD 2025 summary

Strategic direction and organizational structure

• Focus on three divisions: Industrial Data Solutions (IDS), Industrial Network Technology (INT), and New Industries, each with tailored strategies and customer approaches.

• Emphasis on proximity to customers, with a shift back to decentralized decision-making and divisional accountability.

• Accelerating new customer acquisition and expanding within the existing base from 2026-2030, with M&A prioritized to strengthen divisions.

• Continued pursuit of both organic growth and M&A, targeting a balanced 50/50 split to reach SEK 7.5 billion revenue by 2030.

• Organizational culture prioritizes high-performing, engaged employees and leadership development.

Financial performance and targets

• Achieved 18% CAGR in net sales from 2020 to 2025, with significant contributions from six acquisitions.

• Net sales target set at SEK 7.5 billion by 2030, with an EBITDA/EBITA margin target of 25%.

• ARR targeted to reach or exceed 10% of net sales by 2030, supporting a gross margin ambition above 65%.

• Dividend payout targeted at 30%-50% of adjusted EPS, with leverage to remain below 2.5x net debt/EBITDA.

• Cash conversion normalized to around 75%, with debt levels being reduced monthly.

Growth initiatives and market trends

• Market growth expected at 7%-9% CAGR, with IDS and INT targeting increased market share through new platforms and expanded offerings.

• Key trends: deglobalization, automation, digitalization, cybersecurity, and AI, all seen as growth drivers.

• Direct sales to increase from 53% to over 55% of revenue, focusing on large customers and cross-selling opportunities.

• Operational efficiency improvements expected to allow sales growth to outpace OpEx growth.

• Significant investments planned in product portfolio updates to boost service content and ARR.