Q1 2025: Steady despite uncertainty
FIRST QUARTER 20251
- Revenue increased by 3% to SEK 1,206m (1,172)
- Operating profit decreased to SEK 13m (21)
- Operating margin decreased to 1.1% (1.8)
- The result for the period decreased to SEK -150m (70)
- Basic earnings per share1 amounted to SEK -10.32 (4.83)
- Cash flows from operating activities amounted to SEK 185m (124)
| SEK m (or as stated) | 2025 Q1 | 2024 Q11 | % | 2024 FY |
| Revenue | 1,206 | 1,172 | 3% | 4,720 |
| Gross profit | 197 | 231 | -15% | 853 |
| Operating profit | 13 | 21 | -35% | 21 |
| Result for the period | -150 | 70 | -314% | -89 |
| Earnings per share, SEK2 | -10.32 | 4.83 | -314% | -6.15 |
| Cash flow from operations | 185 | 124 | 340 | |
| Net debt (cash) | 1,826 | 1,542 | 1,978 | |
| Gross margin, % | 16.3% | 19.7% | -3.4pp | 16.5% |
| Operating margin, % | 1.1% | 1.8% | -0.7pp | 0.2% |
| Working capital/LTM Revenue, % | 17% | 20% | -2.6pp | 23% |
| Equity/total assets, % | 30% | 33% | -3.2pp | 30% |
| Return on capital employed, % | 1% | -2% | 2.3pp | 1% |
| Return on equity, % | -20% | -2% | -17.7pp | -6% |
1 In Q1 2025 certain revenue and cost items have been reclassified, with effects on comparable numbers in Q1 2024 for revenue, gross
profit, SG&A and other income. For more details on this effect, please refer to the note on p8 in the report.
2 Before dilution.
Lars Corneliusson, President and CEO, comments:
During the first quarter of 2025, we saw increased uncertainty in our markets. Despite this, our underlying business remained relatively stable, largely thanks to our robust service and parts business.
In the US, there is speculation about the effects of new trade and fiscal policy and the risk of recession. Despite the uncertainty, the mood among our customers in the US remains good. However, dealers still have high levels of machines in stock and in their rental fleets. During the first quarter, price competition intensified and pressure on margins increased. The US market for construction equipment decreased by 5%. Our sales of new machines and sales from our rental fleet decreased by 6% in units. Overall, sales increased by 9% but operating profit decreased by 21% to
SEK 48m compared to a very strong first quarter of 2024.
In Germany, the market remains challenging after two years of negative growth. The business outlook has improved somewhat after a new government was formed and announced plans for major investments in defence and infrastructure. The market for trucks, however, decreased by 28% during the quarter. Our sales of new trucks decreased by 6% in units and we increased our market share significantly. Although customers are still cautious about renewing their fleets, they continue to use their existing trucks. Demand for service therefore remains strong and we could have sold more service hours and spare parts if we had more service technicians. Overall, sales in Germany decreased by 9% to SEK 402m. Operating profit amounted to SEK -9m. With the cost savings we have implemented, a promising recruitment campaign for service technicians and a more well-balanced inventory, we are now significantly more resilient and in a better position to capture opportunities in Germany.
In Kazakhstan, our sales of new machines increased to 28 units. Overall, sales increased to SEK 42m, with a positive operating profit of SEK 1m.
For the Group, sales increased by 3% to SEK 1,206m. Operating profit amounted to SEK 13m. Net profit was negatively affected by the strengthening of the Swedish krona against the euro and the US dollar. The Group's net debt decreased to SEK 1,826m, mainly due to exchange rate effects.
Despite the current uncertainty, we remain optimistic about our operations in the US and the long-term opportunities there. Demand is supported by a dynamic economy and a significant need to upgrade the country's infrastructure. The German economy remains weak, but we have taken steps to reduce costs and make our organization and balance sheet more resilient. We are confident that aftermarket demand will remain strong and are optimistic about the long-term potential in Germany. We also continue to see opportunities in the market in Kazakhstan.
About Ferronordic
Ferronordic is a service and sales company in the areas of construction equipment and trucks. It is the dealer for Volvo CE in all or parts of nine states in the United States and also represents Hitachi, Sandvik and Link-Belt in parts of the same area. Ferronordic is dealer of Volvo Trucks, Renault Trucks in Germany and dealer of Volvo CE and certain other brands in Kazakhstan. Ferronordic began its operations in 2010 and currently has 37 outlets and approx. 800 employees. Ferronordic's vision is to be the leading service and sales company in its markets. The shares in Ferronordic AB (publ) are listed on Nasdaq Stockholm. www.ferronordic.com
This information is information that Ferronordic AB (publ) is obliged to disclose pursuant to the EU Market Abuse Regulation and the Swedish Securities Market Act (2007:528). The information was submitted for publication on 15 May 2025, 07:30 CET.
Contact
For investors, analysts and media:
Erik Danemar, CFO and Head of Investor Relations
+46 73 660 72 31
ir@ferronordic.com
