NOTE (NOTE) Q1 2026 earnings summary

Executive summary

• Q1 2026 began with lingering supply chain and output issues from Q4, resulting in a weak January, but performance improved through February and March, ending the quarter strong.

• Q1 2026 sales reached SEK 962 million, down from SEK 1,003 million year-over-year, with organic growth at -6% after currency and acquisition adjustments.

• The acquisition of STI, a leading UK defense EMS provider, was completed and is considered transformational, expected to add SEK 550–600 million in sales for 2026 and expanding exposure to the security and defense sector.

• Security & Defence segment now represents 18% of business, with expectations for further growth.

• Order backlog increased 11% year-over-year, with longer-term orders supporting growth into 2027.

Financial highlights

• Q1 sales reached SEK 962 million, slightly above guidance, but organic growth was -6% year-over-year.

• Reported operating margin was 8.7%; underlying/adjusted operating margin was 9.1%, slightly above the guided range.

• Profit after tax was SEK 52 million, or SEK 1.83 per share.

• Operational cash flow was SEK 46 million, lower than previous quarters due to lower profitability and a buildup in working capital.

• Equity ratio remains strong at approximately 35% despite recent acquisitions.

Outlook and guidance

• Entering Q2 with strong momentum; Q2 is expected to be the best quarter to date, with continued improvement throughout 2026.

• Underlying operating margin for the full year is expected to return to 9.5%-10.5%.

• STI is expected to contribute SEK 550–600 million in sales for the remainder of the year, with a back-end loaded revenue profile.

• Order backlog at quarter-end was 11% higher year-over-year on a like-for-like basis.

• Cash flow is expected to remain positive and stable, with working capital needs rising moderately as growth resumes.