POSITIVE CONTRIBUTIONS FROM ACQUISITIONS, CONTINUED SOLID CASH FLOW AND CAUTIOUS MARKET CONDITIONS

Comments refer to continuing operations unless otherwise stated

• Net sales increased by 4% to SEK 1,330 million (1,283). In total for the Group, organic sales change was -4%, excluding currency effects.
• EBITA amounted to SEK 255 million (255), corresponding to an EBITA margin of 19.2% (19.9).
• Adjusted EBITA was in line with the previous year and amounted to SEK 251 million (252), corresponding to an adjusted EBITA margin of 18.9% (19.6). Organic adjusted EBITA decrease was -8%, excluding currency effects.
• Profit before tax for the quarter amounted to SEK 123 million (162), which was affected by unrealized exchange rate differences of SEK -25 million (3) and increased interest expenses.
• Profit after tax amounted to SEK 74 million (110) and earnings per share amounted to SEK 1.83 (2.81).

• Cash flow from operating activities amounted to SEK 170 million (171), corresponding to a cash conversion of 74% (72).

SIGNIFICANT EVENTS AFTER THE END OF THE REPORTING PERIOD

• New loan agreement signed to more favourable terms for refinancing of existing loans. The credit facility is increased to support the Group's growth strategy.

COMMENTS BY THE CEO

Sdiptech summarizes a quarter in which several parts of the Group's units continued to have a good demand. However, with uncertainties in the global environment, we saw towards the end of the period that some customers were holding off on planned projects. Net sales increased by 4%, while adjusted EBITA was at the same level as last year and amounted to SEK 251 million, resulting in an adjusted EBITA margin of 18.9%. Cash flow generation from operating activities remained stable at 74%, generating SEK 170 million in the quarter.

Quarterly summary
Net sales increased by 4% in the quarter. Both acquisitions and good organic development in a number of our business units made a positive contribution. At the same time, the Group's overall organic sales declined by 4% excluding currency effects. We see some impact towards the end of the period due to the recent escalation of trade barriers and geopolitical unrest, particularly in Supply Chain & Transportation. Our exposure to the US is limited to approximately 4% of total sales, and we have no sales between the US and China. We are working to ensure the best possible operation for each business, for example by utilizing our local manufacturing facilities and thus ensuring continued delivery to customers in the US.

Our adjusted EBITA for the quarter was at the same level as last year. While acquisitions have had a positive contribution to the Group's profit, the organic development was -8% excl. currency. Units within Energy & Electrification had a positive contribution, where we see several drivers that are persistent, such as electrification and energy efficiency. Some units in Supply Chain & Transportation also had a good demand for their efficient and safe transportation solutions. However, we have already started to see the effects of the new legal requirement in the UK which means increased wage levels, even though these laws only came into force from April 1. This is putting pressure on margins in the short term as we have delays in some longer contracts before this can be fully compensated for with price increases. This is mainly noticeable in Water & Bioeconomy.

We are definitely not satisfied with the deteriorating margins, and we are focused on initiatives linked to profitability, efficiency and selective growth. We are also working on reviewing our portfolio based on the criteria we have set for new companies since our strategic shift in 2019. For example, the group's only remaining construction unit, which had difficulties in 2024, has gradually wound down, and the sales process of the elevator business in Central Europe is also proceeding according to plan with ongoing dialogues with several stakeholders.

Acquisitions
During the quarter, we acquired Phase 3 Connectors Ltd in the UK, which ensures reliable and efficient power distribution for events, data centers and industrial facilities, among others. Phase 3 has previously collaborated with other units within the Energy & Electrification business area, of which the company is a part of from February 2025. We have also completed a small add-on acquisition to our Dutch unit Certus, which works with image processing and software development for the optimization of ports, terminals, truck parks and logistics companies. The add-on acquisition, called Supplai, specializes in AI algorithms and video processing solutions, and will result in Certus being able to offer an even more efficient, accurate and reliable solution.

Outlooks
Our acquisition pipeline remains solid, and we have many ongoing dialogues. At the same time, we are keen to balance the pace of acquisitions against prevailing external factors and uncertainties. To secure future acquisition opportunities for high-quality companies, we have renewed and expanded our bank financing. In addition to the larger credit frame, it also lowers our interest rates.

Several of our business units are working to adapt their operations and cost levels based on the market situation for each business. As mentioned above, our portfolio is continuously reviewed based on today's strict criteria. We are actively working to set up separate plans for those companies that do not fully meet these criteria. As part of this, further divestments may become relevant.

I would like to highlight our employees, whose commitment and adaptability continue to be a decisive strength. Our culture and values create stability even when the external environment changes. Finally, I would like to express my appreciation to our shareholders for your continued trust.

Bengt Lejdström
President and CEO