Instalco (INSTAL) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 grew 0.3% year-over-year to SEK 3,293 million, with positive organic growth for the first time since Q2 2023, mainly from the industrial segment.

• Service business accounted for 36% of revenues, providing stability amid market challenges.

• The company completed the first phase of its German expansion and finalized the acquisition of Alf Näslunds Eltjänst in Sweden, adding SEK 55 million in annual sales.

• The organization is a leading northern European provider in technical installation and consulting, with over 6,000 employees and a decentralized structure.

• Order backlog increased to SEK 9,019 million, with a book-to-bill ratio of 66% and organic order backlog growth of 2.1%.

Financial highlights

• Adjusted EBITA/EBITDA for Q1 was SEK 187 million (margin 5.7%), while reported EBITA was SEK 123 million (3.7% margin) due to a SEK 64 million one-off cost from Northvolt's bankruptcy.

• Cash flow from operations reached SEK 223 million, up 12% year-over-year, with cash conversion at 96% (R12M).

• Adjusted EBITA margin for the last 12 months was 6.6%, down from 7.6% a year ago.

• Earnings per share before and after dilution were SEK 0.16, down from SEK 0.37.

• Equity ratio stood at 34.1%; cash and cash equivalents at period end were SEK 87 million.

Outlook and guidance

• Market remains challenging but early signs of recovery are visible, especially in Sweden and the industrial/service segments.

• Management expects continued margin pressure and is focused on cost optimization, risk minimization, and selective growth.

• Leverage is above target but expected to decrease as market conditions improve; financial position remains stable.

• Strategic targets include ≥10% average sales growth, 8% EBITA margin, 100% cash conversion, and net debt/EBITDA ≤2.5x.