AFRY (AFRY) Q1 2025 earnings summary

Executive summary

• Q1 2025 saw a 2.1% year-over-year sales decline and pressured profitability, mainly due to weak Industrial & Digital Solutions and Process Industries, partly offset by strong Energy growth.

• Profitability was impacted by slow ramp-up, challenging market conditions, and negative calendar effects of -37 MSEK on EBITA.

• Announced a new Group structure and Executive Team changes to focus on core business, improve client value, and enhance operational efficiency, effective July 1, 2025.

• Order backlog increased by 4% sequentially (currency adjusted), reflecting continued success in winning key client projects.

Financial highlights

• Net sales for Q1 2025 were SEK 6,749 million, down from SEK 6,891 million in Q1 2024; EBITDA was SEK 490 million, with an EBITDA margin of 7.3%.

• EBITA (reported) was SEK 459 million (margin 6.8%), compared to SEK 582 million (8.4%) a year ago.

• Earnings per share were SEK 2.21, compared to SEK 3.13 in Q1 2024.

• Operating cash flow was SEK 108 million, with available liquidity at SEK 3.7 billion and net debt/EBITDA at 2.3x.

• Order backlog reached SEK 20.2 billion, up 4% sequentially (currency adjusted).

Outlook and guidance

• Market uncertainty persists, especially due to global tariffs, but direct impact remains limited.

• No major market shifts expected since last quarter; industrial sector remains mixed, with strong defense demand but weak pulp, paper, and IT consulting.

• Process Industries expected to see a turning point in growth within a couple of quarters, especially in metals and mining.

• Updated strategy to be presented in the second half of 2025, with new structure aimed at accelerating profitable growth.