Coor Service Management (COOR) Q1 2025 earnings summary

Executive summary

• New CEO appointed, focusing on operational efficiency, meeting employees and customers, and leading Swedish operations until a replacement is found.

• Implementation of a simplified organization reducing 130 positions, targeting SEK 120 million in annual savings.

• Strong customer relationships and high employee competence highlighted, with key contract wins and extensions in Norway, Denmark, and Finland.

• Focus on operational efficiency and profitability, with improved cash flow and reduced working capital.

• Stable market conditions with successful contract extensions and new wins in medium and small segments.

Financial highlights

• Q1 2025 net sales were SEK 3,052 million, down 2% year-over-year; organic growth -2%, FX effects up to -1%.

• Adjusted EBITA for Q1 2025 was SEK 144 million (margin 4.7%), down from SEK 160 million (5.1%) in Q1 2024.

• Net income for Q1 ranged from SEK 50 million to SEK 122 million; adjusted net income SEK 64 million.

• Cash conversion improved to 81% (LTM), up from 57% in the previous quarter.

• Leverage decreased to 2.8x net debt/Adj. EBITDA LTM, below the target of <3.0x.

Outlook and guidance

• Focus for the next 12 months is on margin improvement and operational efficiency, especially in Sweden and Denmark.

• Cash conversion is expected to be fully restored throughout 2025 as temporary effects from contract changes and personnel liabilities are resolved.

• Management will provide a more detailed plan for margin targets and strategic direction in future updates.

• Additional working capital reductions targeted for 2025.

• Savings from reorganisation expected to be realised gradually during H1 2025.