Bergman & Beving AB (FRA:BLRB) Q1 2026 Earnings Call Highlights: Strong EBITDA Growth Amid ...

Bergman & Beving AB (FRA:BLRB) Q1 2026 Earnings Call Highlights: Strong EBITDA Growth Amid ...

Stocks end lower as tech bleeds, Fed policymaker calls for ’modestly higher’ rates GuruFocus - - Organic Growth: 1% organic growth in turnover. - EBITDA Increase: 9% increase in EBITDA. - EBITDA Margin: Improved to 10.7%, an increase of 0.8 percentage points from the previous year.

- Profit Working Capital: Reached 37% for the quarter. - Earnings Per Share (EPS): Rolling 12-month EPS increased from SEK8.2 to SEK8.5. - Net Debt Reduction: Decreased by SEK100 million in the quarter.

- Net Debt to EBITDA Ratio: 2.5, same level as a year ago. - Core Solutions Revenue Increase: 11% increase, with half from organic growth and half from acquisitions. - Core Solutions EBITA Margin: 14.7%.

- Safety Technology Revenue Increase: 27% increase, with growth across most companies. - Safety Technology EBITA Margin: Increased to 16.8% from 16.4%. - Machinery and Equipment EBITA Margin: Decreased to 4.2% from 11.6% last fiscal year.

- PPE and Utilities Revenue: SEK360 million compared to SEK485 million last fiscal year, flat when adjusted for divestments. - Cash Flow: Strong quarter, according to plan. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points - Bergman & Beving AB (FRA:BLRB) achieved a 9% increase in EBITDA, marking 26 consecutive quarters of improved profits. - The company reported a 0.8% improvement in EBITDA margin, now at 10.7%, compared to the same period last fiscal year. - Earnings per share improved from SEK8.2 to SEK8.5 on a rolling 12-month basis.

- The Core Solutions division saw an 11% revenue increase, with a 30% rise in EBITA, driven by both organic growth and acquisitions. - Safety Technology division experienced a 27% revenue increase and a 29% rise in EBITA, supported by successful acquisitions and organic growth. - Rising raw material and energy costs due to the Iran conflict have increased operational challenges.

- The Machinery and Equipment division reported a significant decline in EBITA margin from 11.6% to 4.2%, attributed to a less favorable business mix and one-off costs. - The PPE and Utilities division experienced a revenue decline, with EBITA dropping from SEK19 million to SEK9 million, indicating ongoing performance issues. - Organic inventory reduction has slowed, partly due to increased safety stock in response to market volatility.

- The company faces uncertainties in the underlying market, with no significant growth expected in the near term due to geopolitical tensions. A: Magnus Soederlind, CEO, explained that the situation is volatile, with some components like plastics seeing price increases up to 50%, now down to 30%. Steel prices have risen by 10% year-on-year due to energy costs.

The company is monitoring these costs daily, supported by AI, and has implemented price hikes to mitigate the impact, although the full effects will be seen in future quarters. Q: What is the breakdown of organic growth versus price increases in the 1% organic growth reported? A: Magnus Soederlind noted that price adjustments take time to reflect in financials due to existing stock levels and delivery times.

The effects of cost increases and price adjustments will be more visible in the current quarter, Q2. Q: Are the impressive margins in Core Solutions driven by temporary factors or sustainable improvements? A:

The CEO confirmed that the margin improvements are sustainable, resulting from ongoing organic efforts and successful acquisitions, with no temporary effects influencing the results. Q: How will capital allocation be managed across divisions, particularly between high-performing and underperforming segments? A: Magnus Soederlind stated that acquisitions will focus on Core Solutions, Safety Technology, and Machinery and Equipment divisions.

The PPE and Utility division will focus on improving current operations without new acquisitions. Q: What is the outlook for the Machinery and Equipment division, given its recent underperformance? A:

The CEO expects a bounce back in Q2, citing temporary costs and project-based business volatility as factors in Q1’s performance. The division has good forecasts for the current quarter, and long-term expectations remain positive. For the complete transcript of the earnings call, please refer to the full earnings call transcript.