Focus on long-term profitability in a challenging market
The fourth quarter in summary
• Net Sales decreased to SEK 502.6 million (577.3)
• Operating profit decreased to SEK -27.5 million (3.8)
• Earnings before tax (EBT) decreased to SEK -41.4 million (-13.8)
• Net income for the period decreased to SEK -44.4 million (-16.9)
• Cash flow from operating activities amounted to SEK 63.9 million (60.1)
The full year in summary
• Net Sales decreased to SEK 2,012.8 million (2,182.5)
• Operating profit decreased to SEK -46.0 million (43.5)
• Earnings before tax (EBT) decreased to SEK -95.7 million (-0.7)
• Net income for the period decreased to SEK -103.9 million (-12.9)
• Cash flow from operating activities amounted to SEK 125.9 million (183.1)
Comments from the Group President and CEO, Roger Berggren;
The fourth quarter of 2024 was characterized by a continued challenging market, where geopolitical turmoil and economic uncertainty negatively impacted our sales and margins. Demand in the heavy commercial vehicle and passenger car industries continued to decline during the quarter, leading to lower net sales and negative operating income compared to the corresponding period last year. To address these challenges, we have implemented several strategic initiatives, including our cost savings program of an expected annual profit improvement of SEK 100 million, which already in Q4 2024 started to show positive effects.
Net sales for the quarter amounted to SEK 502.6 million (577.3), a decrease of 12.9% compared to the same quarter last year. For the full year, net sales were SEK 2,012.8 million (2,182.5), a decrease of 7.8%. Operating profit for the fourth quarter amounted to SEK -27.5 million (3.8) and for the full year SEK -46.0 million (43.5).
Our investments in electrification are an important part of our long-term strategy and we remain convinced of its potential. However, so far, they have not lived up to our expectations, mainly due to market volatility. We are actively working to adapt our offering to better meet market needs and ensure future profitability in this area.
The Latvian operations, where we have invested in electrification, have had a negative impact on earnings during the year and account for the largest deviation compared to the previous year. However, we see clear improvements in 2025, and we expect this business to generate a positive cash flow going forward. The German operations continued to show a weak progress, and we expect continued challenges. At the same time, we see opportunities to grow sales in the German market, both in the automotive industry and in general industry.
Demand in the defence industry is strong, and we see significant opportunities to expand in this area. With increasing defence budgets and a growing need for advanced technical solutions, this is a strategically important market for LEAX. We are working hard to strengthen our position by developing competitive offerings, deepening partnerships with existing customers and establishing new business relationships. Our ambition is to become a reliable and long-term partner in the defence industry, where our technical expertise and manufacturing capacity create value for customers.
To maintain a stable and sustainable business in the long term, we continue to have financial strength as a priority. We are focusing on optimising cash flow and reducing debt, while investing in future growth areas.
The first quarter of 2025 is expected to remain challenging, but we see a clear improvement from Q2 onwards, driven by a stronger order book. Our investments in new projects and implemented cost efficiencies are expected to gradually yield positive results in the coming quarters. We also continue to prioritize operational efficiency and commercial progress to create the best conditions for sustainable and long-term profitability.
I would like to thank all employees for their commitment and efforts during this challenging year. Together we are building a solid foundation for the future and developing LEAX in a changing market.
Roger Berggren, Group President and CEO
Telephone: +46 (0)70 655 99 71
E-mail: roger.berggren@leax.com
Jonas Lundberg, CFO
Telefon: +46 (0)70 453 58 14
E-mail: jonas.lundberg@leax.com
About LEAX
LEAX Group AB (publ) is the parent company of a group ("LEAX Group") with about 1,000 employees. LEAX has operations in Köping, Falun and Falköping in Sweden, Riga and Rezekne in Latvia, Curitiba in Brazil, Detmold in Germany and Mezökövesd in Hungary. The Group designs, develops and industrializes advanced manufacturing solutions and superior products for global mobility and industrial markets. The Group had sales of SEK 2.0 billion in 2024.
