Bergman & Beving (BERG) Q1 26/27 earnings summary

Executive summary

• Achieved 1% organic turnover growth for the third consecutive quarter, signaling cautious optimism for continued modest growth despite challenging market conditions and rising input costs.

• EBITA increased by 9% year-over-year to MSEK 142, marking 26 consecutive quarters of profit improvement; EBITA margin rose to 10.7% from 9.9%.

• Earnings per share (EPS, rolling 12 months) improved to SEK 8.55 after dilution, up from SEK 8.2, despite higher interest costs and currency revaluation.

• Successfully managed rising raw material, energy, and freight costs through proactive price adjustments and decentralized operations, with no expected short-term negative margin impact.

• Acquired All-Coating Industrilackeringar AB as an add-on to Uveco, maintaining an active acquisition strategy targeting SEK 50–80 million EBIT per annum.

Financial highlights

• Net sales were flat year-over-year at MSEK 1,323, with 1% organic growth offset by a 1% negative impact from divestments.

• Gross margin remained strong at around 50% for the third consecutive quarter, driven by organic improvements and favorable product mix.

• Profit/working capital (P/WC) ratio reached 37% (rolling 12 months), with the three-month figure even higher.

• Net debt reduced by SEK 100 million in the quarter, with net debt/EBITA at 2.5x, unchanged from a year ago; operational net loan liability at MSEK 1,566.

• Cash flow from operating activities increased to MSEK 190 from MSEK 182, reflecting seasonally strong performance.

Outlook and guidance

• Underlying market remains cautious with no significant growth expected in the current quarter; gradual demand recovery anticipated in 2026.

• Positive leverage expected when market recovers, due to higher gross margins and cost efficiencies already achieved.

• Acquisition pipeline remains strong, with continued focus on Core Solutions, Safety Technology, and Machinery & Equipment divisions.

• No acquisitions planned for PPE & Utilities division in the near term; focus is on operational improvement.

• Focused on profit expansion over revenue growth, leveraging acquisitions and operational improvements.