Vestum (VESTUM) Q1 2025 earnings summary

Executive summary

• Achieved 3% organic growth in Q1 2025, marking the first positive organic growth in two years, with improved profitability and adjusted EBITA margin at 8.7%.

• Leverage reduced to 2.1x reported EBITDA, below the 2.5x target, mainly due to divestitures and a new capital structure established in March 2025.

• Cash flow decreased due to increased investments, higher working capital, and one-time financial costs from early bond redemption.

• Major divestments and the full redemption of the SEK 600 million bond improved the capital structure.

• Acquisition of Nortech, a UK leader in Flow Technology, completed post-quarter and to be consolidated from Q2.

Financial highlights

• Net sales in Q1 2025 were SEK 900 million, down 9% year-over-year, primarily due to divestments in the Solutions segment.

• Adjusted EBITA for Q1 2025 was SEK 78 million, with an 8.7% margin; EBITA margin increased by 0.5 percentage points year-over-year.

• Free cash flow was negatively impacted by one-off expenses, including SEK 25 million from early bond repayment.

• Net debt at SEK 1.4 billion, slightly lower than previous quarter; leverage at 2.1x EBITDA.

• LTM net sales reached SEK 4,155 million; LTM adjusted EBITA was SEK 411 million (9.9% margin).

Outlook and guidance

• Continued focus on growth through organic initiatives and acquisitions, with optimism for improved free cash flow from Q1 onward.

• Expectation of significant interest cost savings of SEK 15 million per quarter due to new capital structure.

• Market conditions are improving but global economic uncertainty and trade barriers persist.

• Strategy remains focused on disciplined capital allocation and high-margin, niche acquisitions.