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Systemair
Quarterly Report • Aug 29, 2024
2980_10-q_2024-08-29_b3f4a37e-3f35-4817-9772-66fea1e4d72d.pdf
Quarterly Report
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Quarterly report
1 MAY – 31 JULY
2024/25
Air handling units Fans Air distribution products
Residential ventilation Fire safety Airborne heating Air conditioning
2023 | 2024
Quarterly report Q1
First quarter, May – July 2024
- Net sales decreased 2.0 percent to SEK 3,111 million (3,175).
- Organic growth was -0.3 percent (+10.7).
- Operating profit (EBIT) totalled SEK 305 million (335). The Group's operating margin was 9.8 percent (10.5).
- Profit after tax amounted to SEK 210 million (242).
- Cash flow from operating activities totalled SEK +188 million (+307).
- Earnings per share (basic) were SEK 1.01 (1.17).
Significant events during the period under review
- In May 2024, Systemair acquired PHEM Engineering SDN. BHD., a manufacturer of ventilation products in Malaysia. The company has 40 employees and reported sales of SEK 47 million in the past financial year ending in March 2024.
- The relocation of Menergas' production in Muelheim and der Ruhr, Germany, to Maribor, Slovenia, was completed on schedule in the first quarter.
| 2024/25 | 2023/24 | 2023/24 | |
|---|---|---|---|
| May–Jul | May–Jul | May-Apr | |
| 3 mths | 3 mths | 12 mths | |
| Net sales, SEK m. | 3,111.3 | 3,174.9 | 12,256.6 |
| Growth, % | -2.0 | 11.4 | 1.6 |
| Operating profit, SEK m. | 305.2 | 334.9 | 963.0 |
| Operating margin, % | 9.8 | 10.5 | 7.9 |
| Profit after tax, SEK m. | 210.1 | 242.3 | 653.8 |
| Earnings per share (basic) (SEK)1 | 1.01 | 1.17 | 3.10 |
| Earnings per share (diluted) (SEK)1 | 1.01 | 1.17 | 3.10 |
| Operating cash flow per share (basic) (SEK)1 | 0.91 | 1.47 | 6.41 |
| Operating cash flow per share (diluted) (SEK)1 | 0.91 | 1.47 | 6.41 |
1) Systemair AB has issued 1,451,240 warrants to persons holding senior positions at the Company.
2024 | 2025
Major orders during the period
Systemair products installed in medical research centre in Sicily
Systemair has delivered air distribution products valued at EUR 1 million to the Ri MED Centre in Sicily, Italy. The Centre is at the leading edge of medical research, in areas such as new vaccines, drugs, cell therapy and tissue engineering.
Systemair delivering fans for renovation of E39 tunnels in Norway
Systemair has delivered tunnel fans for the renovation of road tunnels on the E39 outside Lyngdal in Norway. The delivery comprises in all 48 large 1.1-metre diameter fans with an order valued at approximately EUR 0.7 million. The fans quickly and efficiently remove pollutants and hazardous gases, creating safe and healthy environments.
CEO's comments
|Quarter 1
We achieve a gross margin of 36.0 percent and an operating margin of 9.8 percent for the quarter despite a weak market. New production of residential and commercial properties in the Nordics and Western Europe is at a lower level. Other regions continue to show good growth. Last year's comparative figures were very strong as a result of the recovery that took place after a period of component shortages.
The market
The Nordics and parts of Western Europe have weaker growth in the quarter, but we see a stabilization. Eastern Europe, the Middle East, Asia and North America have shown good growth, which we believe will continue. Demand for energy-eIcient ventilation solutions will be good in the future. The updated directives within the EPBD (Energy Performance of Buildings Directive) now set clearer requirements for conversion and indoor air quality. We see it as positive, as Systemair has a product range that meets the requirements well.
Acquisitions and investments
In May, we completed our acquisition of PHEM Engineering in Malaysia. The company manufactures air handling units and, along with our existing operations in Malaysia, provides us with a platform for continued growth in the region. Today, PHEM currently employs 40 and reports sales of around SEK 47 million. The company's product range will enables us to extend the range of our oJering in local markets.
We are continuing to invest for the long term to underpin our delivery capacity and product development. Commitment to a healthy indoor environment and technological innovation are key drivers for our business, supported by global climate targets and directives.
Investments in buildings and machinery are currently in progress, for example in Lithuania, Germany, Norway and Canada, mainly with a view to streamlining production and increasing capacity. The relocation of Menergas' production from Germany to Slovenia was completed on schedule during the quarter and will fully contribute through higher eIciency and improved profitability as of the next financial year.
Our strong balance sheet crates the scope for more future investments and strategic acquisitions. In addition, we have substantially reduced our debt, which significantly lowers our interest costs.
Sustainability
Our energy-eIcient products make an important contribution in terms of energy saving and indoor air quality, and thus oJer major business potential for the future. Reducing energy demand – and in that way lowering emissions from buildings – is one of the most important issues to society, in order to reduce climate impact and achieve the climate targets that have been set.
We are also particularly proud of our eJorts to reduce the number of work-related injuries, which have delivered clear outcomes. Our work to strengthen structure, procedures and follow-up is helping to create more reliable, safer production.
We are looking at the whole value chain and managing the risks that exist, and actively seize upon opportunities for long-term improvements.
Outlook favourable
We see a continuingly high level of activity among consultants and ventilation contractors. We anticipate more positive market developments as market interest rates fall and as inflation targets are met.
With our 25 well-invested production facilities in 18 countries and the most comprehensive product range in energy-eIcient ventilation on the market, we are well equipped for continued long-term and profitable growth.
Roland Kasper CEO
Sales and markets
Group sales for the first quarter of the 2024/25 financial year totalled SEK 3,111.3 million (3,174.9), down 2.0 percent from the same period last year. Adjusted for the eJects of foreign exchange and acquisitions, net sales decreased 0.3 percent. Acquisition-related growth was 0.5 percent. During the quarter, foreign exchange eJects reduced sales by 2.2 percent.
Geographical breakdown of Q1 sales
Nordic region
During the first quarter, sales in the Nordics were 4.7 percent lower than in the same period last year. In all Nordic countries, sales decreased during the quarter. Adjusted for foreign exchange eJects, sales decreased 4,1 percent.
Western Europe
During the quarter, sales in the West European market were 4.8 percent lower than in the corresponding period last year. Adjusted for foreign exchange eJects, sales decreased 4,1 percent. The Netherlands, the UK and Germany showed negative growth in the quarter, while sales in Italy, Spain and France increased.
Eastern Europe and CIS
During the quarter, sales in Eastern Europe and the CIS were 1.0 percent higher than in the corresponding period last year. Azerbaijan, Serbia and the Czech Republic showed growth during the quarter, while sales in the Slovakian, Slovenian and Polish markets declined. Adjusted for foreign exchange eJects and acquisitions, sales rose 3.7 percent.
North America
Sales in North America during the quarter were 0.7 percent higher than in the same period last year. Adjusted for foreign exchange eJects, sales rose 1.8 percent. The Canadian market showed growth during the year, while the USA market declined. Sales of residential air handling units increased after a period where levels were lower.
Middle East, Asia, Australia and Africa
Sales in the Middle East, Asia, Australia and Africa increased by 4.7 percent compared with the same period last year. Adjusted for foreign exchange eJects and acquisitions, sales rose 10.7 percent. Malaysia, India and Singapore continued to report good growth over the period.
SEK 3,111 m.
Net sales in interim period May to July 2024
| 2024/25 | 2023/24 | |||
|---|---|---|---|---|
| May–Jul | May–Jul | Change | Of which | |
| 3 mths | 3 mths | in sales | organic | |
| Nordic region | 422.6 | 443.7 | -4.7% | -4.1% |
| Western Europe | 1,393.7 | 1,464.2 | -4.8% | -4.1% |
| Eastern Europe & CIS | 411.5 | 407.5 | 1.0% | 3.7% |
| North America | 415.3 | 412.5 | 0.7% | 1.8% |
| Middle East, Asia, Australia and Africa | 468.2 | 447.0 | 4.7% | 10.7% |
| Total | 3,111.3 | 3,174.9 | -2.0% | -0.3% |
(Sales figures are based on geographical domicile of customers.)
Net sales per quarter compared with same period previous years
Net sales
Sales by market, 3 months
2024/25 (2023/24)
- Nordic region
- Western Europe
- Eastern Europe & CIS
- North America
- Middle East, Asia, Australia and Africa
Results for the first quarter
Gross profit for the first quarter amounted to SEK 1,120.7 million (1,098.8), an increase of 2.0 percent over the same period last year. The gross margin was 36.0 percent (34.6).
Operating profit for the first quarter totalled SEK 305.2 million (334.9), down 8.9 percent from the same period in the preceding year. The operating margin was 9.8 percent (10.5). Operating profit includes a hyperinflation adjustment of SEK -0.6 million.
Selling and administration expenses for the quarter totalled SEK 814.6 million (788.5), a rise of SEK 26.1 million, or 3.3 percent. Companies acquired accounted for SEK 1.5 million of the increase in costs. Selling and administration expenses in like-for-like units rose SEK 24.6 million. Work is in progress at several units to realign costs to meet any decline in sales.
No major costs were charged to selling expenses for anticipated bad debts (previous year: SEK 5.7 million). Acquisition-related costs of SEK 0.1 million (–) were charged to income during the quarter.
The overall eJect on operating profit from the hyperinflation adjustment aJecting Turkey was SEK -0.6 million (-10.5).
Net financial items for the first quarter totalled SEK -16.8 million (-18.0). The eJects of foreign exchange on longterm receivables, loans and bank balances totalled SEK -0.4 million (+2.6) net. Interest expenses for the quarter amounted to SEK -15.6 million (-20.9).
Tax expense
Estimated tax for the quarter totalled SEK -78.3 million (-74.6), corresponding to an eJective tax rate of 27.1 percent (23.5) based on profit after net financial items. The high tax charge for the period arises from noncapitalised loss carry-forwards attributable to loss-making companies.
Acquisitions and new businesses
In May 2024, Systemair acquired PHEM Engineering SDN. BHD., a manufacturer of ventilation products in Malaysia. The company has 40 employees and reported sales of SEK 47 million in the past financial year ending in March 2024.
For more information regarding the acquisition and its impact on the Group's cash and cash equivalents, see Note 3 in this report.
Investments, depreciation and amortisation
Investments in the quarter, net of disposals, totalled SEK 120.5 million (172.2), including SEK 94.7 million (129.3) in new construction and machinery. The investments related primarily to production facilities in Lithuania, Germany and Italy. Depreciation, amortisation and impairment of non-current assets amounted to SEK 111.4 million (104.7).
Cash flow and financial position
Cash flow from operating activities, before changes in working capital during the quarter, totalled SEK 379.3 million (388.5).
Changes in working capital, in connection above all with higher trade accounts receivable, but also inventories, had a total impact of SEK -190.9 million (-81.8) on cash flow. Cash flow from financing activities totalled SEK -44.8 million net (-70.5), as a result of lower net borrowing. At the end of the period, net indebtedness was SEK 1,056.3 million (1,433.0). Leverage (net debt/EBITDA) was 0.76 (0.69). Adjusted leverage (net debt/adjusted EBITDA) was 0.71 (0.90). The consolidated equity/assets ratio was 58.9 percent (56.8) at the end of the period under review.
Personnel
The average number of employees in the Group was 6,423 (6,283). At the end of the period under review, Systemair had 6,631 employees (6,616), 15 more than one year previous. Companies acquired added a total of 37 employees, while divested companies reduced the number of employees by 21. New employees were recruited chiefly in Canada (70) and India (38). Personnel cutbacks were made above all in Menerga in Germany (-77), South Africa (-28) and Denmark (-23).
Warrants
On 31 August 2023, the Annual General Meeting of Systemair AB approved the issue of warrants within the framework of the LTIP 2023 incentive programme. During 2023, Systemair AB issued a total of 362,500 warrants for Systemair shares to senior executives of the Company. The warrants were transferred to the participants at a price corresponding to their market value, calculated via an external independent valuation based on an accepted valuation model (Black-Scholes). The programme runs for four years and the last day for subscription is 30 September 2027. In 2021, 592,500 warrants were subscribed for by senior executives under the LTIP 2021 programme and in 2022, 520,740 warrants were subscribed for under the LTIP 2022 programme. These programmes also run for four years and the last days for share subscription are 30 September 2025 and 30 September 2026, respectively. In the preceding year, 24,500 warrants were repurchased from employees who had left their employment. The subscription prices are SEK 98.20 for LTIP 2021, SEK 58.30 for 2022 and SEK 77.50 for 2023.
Financial targets
Systemair has the following financial targets.
- Average annual growth in sales over a business cycle should be no less than 10 percent.
- The average operating margin over a business cycle should be no less than 10 percent.
- The Group's equity/assets ratio should not fall below 30 percent.
- The dividend is to be set at approximately 40 percent of profit after tax.
Tera – Ari handling unit for Data center cooling
Sustainability
Sustainability issues are a central and natural part of Systemair. The importance of good and healthy indoor air is increasing, while the impact of demands for energy- and resource-eIcient solutions is becoming ever-more evident.
We are proud that our energy-eIcient products and ventilation solutions make a real diJerence in reducing energy use in buildings, thus helping to lower greenhouse gas emissions.
In this way, Systemair is helping both to improve public health and mitigate climate change. Through this and our sustainability eJorts, we are taking responsibility and striving for a more sustainable future.
Sustainability is part of our strategy and is increasingly being integrated into our business, with this work encompassing environmental, social and business ethics issues. Our sustainability framework focuses on four areas that contribute to progress in ten of the UN's Sustainable Development Goals.
Responsible enterprise
- Ensuring an ethical and responsible business
- Zero tolerance for corruption
- Taking our responsibility in our supply chain
Sustainable operations
- Reducing greenhouse gas (GHG) emissions
- Improving our own energy eIciency
- Reducing our environmental impact
Sustainable workplace
- Zero vision for workrelated injuries
- Promoting employee development
- Equal opportunities with an inclusive culture
Sustainable products
- Developing leading energy-eIcient solutions
- Improving indoor air quality
- Life cycle approach for reduced environmental impact
Sustainability reporting
Systemair reports annually on its sustainability work in the Company's Annual Report. To improve governance and monitoring and to increase transparency, Systemair compiles selected sustainability data on a quarterly basis. Three key performance measures from sustainability reporting are presented below.
Work-related injuries leading to sickness absence
Systemair strives to ensure that no work-related injuries occur, especially those that lead to sick leave. Our aim is for a reduction of 15 percent per year in our work-related injuries leading to sick leave, as measured by the LTIFR (Lost Time Injury Frequency Rate) metric. We are pleased with and proud of the major reduction that we achieved in 2023/24, where the outcome was a 41 percent reduction from the outcome in 2022/23. The favourable trend continued in the first quarter of 2024/25 as a result of consistent and systematic work through training, monitoring and investment.
Work-related injuries with sickness absence, LTIFR
Female leaders
Increasing the proportion of female leaders is a strategic goal. The aim is that by 2025/26 women will represent no less than 25 percent of Systemair's leaders. A leader is defined as a person who is a member of a local management team and/or is in charge of directly reporting employees. The proportion of female leaders decreased slightly in the past year to 23.7 percent. The metric is volatile in the short term. Systemair uses various measures to establish firmer ground for long-term positive developments in the area.
Scopes 1 and 2 emissions (CO2e)
Systemair has a target of halving its emissions intensity by 2030/31, with 2019/20 as the baseline year. Scope 2 emissions are based on the market-based method. The outcome for the first quarter was a good, low ratio of 1.73 t.CO2e/MSEK, which is to be expected for that period. Absolute emissions decreased by 4 percent in Q1, compared with the same period last year. The outcome on a rolling twelve-month basis was 2.12 t.CO2e/MSEK, representing an overall reduction of 33 percent compared to the base year 2019/20. This was achieved mainly through energy eIciency improvements and investments in solar cell installations.
In Q1, our solar cells generated 1,097,000 kWh. This has led to reductions of 398 tonnes of CO2 in emissions.
Emissions intensity Scopes 1 & 2 (Ton CO2e/SEK m. COGS)
Percentage of female leaders
Events after the close of the period
No significant events have occurred since the end of the financial year.
Exposure to Russia, Ukraine and Belarus
At the end of the period under review, the number of employees in Russia, Ukraine and Belarus stood at 200. Systemair's sales in the region represent 1.7 percent of the Group's total sales in the period under review.
Material risks and uncertainty
Systemair has chosen to organise risk management into four diJerent categories: strategic, operational, financial and regulatory. Strategic risks comprise, for example, macroeconomic developments in the cyclical construction industry, geopolitics and brand-related risks. Examples of operational risk factors include product availability and skills supply. The financial risks that Systemair has identified in its business consist of foreign exchange risk, borrowing and interest rate risk and credit risk and liquidity risk. Finally, regulatory risks include corruption and product requirements. The material risks and uncertainties aJecting Systemair are described in more detail in the Company's 2023/24 Annual Report.
Related party transactions
There were no material related party transactions during the period under review. Transactions with related parties for the 2023/24 financial year are described in detail in Note 40 to the accounts in the Annual Report.
Parent Company
The Parent Company's net sales for the period under review totalled SEK 56.3 million (46.0). Operating profit was negative, at SEK -47.3 million (-41.5). The Parent Company had 68 employees (64). The core business of the Parent Company consists of intra-Group services.
Systemair in Brief
Systemair is a leading ventilation company with operations in 51 countries in Europe, North America, the Middle East, Asia, Australia and Africa. The Company had sales of SEK 12.3 billion in the 2023/24 financial year and today employs approximately 6,600 people. Systemair has reported an operating profit every year since 1974, when the Company was founded. Over the past 10 years, growth has averaged 9.0 percent. Systemair helps to improve the indoor climate via energy-eIcient and sustainable products that reduce carbon dioxide emissions.
Systemair has well-established operations in growth markets. The Group's products are marketed under the Systemair, Frico, Fantech and Menerga brands. Systemair shares have been quoted on the Nasdaq OMX Nordic Exchange in Stockholm since October 2007 and are today traded on the Large Cap List. The Group comprises about 90 companies.
About Systemair
The Company established operations in 1974 with a product concept, the circular duct fan, a design that considerably simplified the process of installation. We adopted the motto "the direct route", which has been developed from a product concept into a business philosophy. Our product range has expanded strongly to extend over a broad range of fans, air handling units, products for air distribution, air conditioning, air curtains and heating products.
Mission statement
Operating from the core values of simplicity and reliability, our business concept is to develop, manufacture and market energy-eIcient, high-quality ventilation products. On the basis of our business concept and with our customers in focus, our aim is to be seen as a company to rely on, with the emphasis on delivery reliability, availability, sustainability and quality.
Business model
Availability is an important parameter in terms of our competitiveness, and we ensure eJective control of our flow of goods, with our own production units, centralised warehouse facilities and an eIcient common ERP system. With modern production plants and our own sales companies around the world, we reach out directly to our customers.
The business model supports stability and development, and today we are a leading producer and supplier of ventilation products with our own production and sales organisation.
Strategies
Systemair's mission is to create better air every day around the world. Through energy-eIcient and sustainable products, we are reducing CO2 emissions and energy consumption, and we are leveraging the market's powerful drivers to achieve our goals.
Strategic priorities:
- We will provide an attractive workplace with an inclusive culture that promotes employee development and entrepreneurship. Through this internal strength, we can build strong relationships based on expertise and trust.
- We provide a wide range of quality products, based on standardised platforms, with energy eIciency and indoor air quality at their core. Our products are designed to make connected and smart solutions possible.
- We will improve our profitability through economies of scale and eIcient product development focused on standardisation. A strong local presence where decision-making is decentralised, for agility on the solid ground of common processes.
- We look to the future in order to prepare for the demands that lie ahead. Sustainable products are part of this: we look at the whole life cycle of the product to improve resource eIciency and our climate footprint. We will build up our servicing business as it plays an important role in optimising the product in operation. Overall, Systemair stands for a long-term approach and will work to put this into practice through sustainable and responsible decisions.
- We will continue to maintain a global and diversified customer base. This provides us with solid foundations for profitable growth via organic investments and an active acquisition agenda. Systemair is our main brand and other brands are only used when they oJer a clear business benefit.
Summary income statement
| Group | Parent Company | ||||||
|---|---|---|---|---|---|---|---|
| SEK m. | 2024/25 May–Jul 3 mths |
2023/24 May–Jul 3 mths |
2023/24 Aug–Jul trl 12 |
2023/24 May-Apr 12 mths |
2024/25 May–Jul 3 mths |
2023/24 May–Jul 3 mths |
|
| Net sales | 3,111.3 | 3,174.9 | 12,193.0 | 12,256.6 | 56.3 | 46.0 | |
| Cost of goods sold | -1,990.6 | -2,076.1 | -7,957.4 | -8,042.9 | - | - | |
| Gross profit | 1,120.7 | 1,098.8 | 4,235.6 | 4,213.7 | 56.3 | 46.0 | |
| Other operating income | 33.2 | 99.7 | 202.4 | 268.9 | 4.1 | 10.7 | |
| Selling expenses | -659.7 | -632.7 | -2,643.7 | -2,616.7 | -38.2 | -30.2 | |
| Administration expenses | -154.9 | -155.8 | -597.3 | -598.2 | -30.4 | -35.7 | |
| Other operating expenses | -38.6 | -77.6 | -336.9 | -375.9 | -39.1 | -32.3 | |
| Net gain on monetary items | 4.5 | 2.5 | 73.2 | 71.2 | - | - | |
| Operating profit/loss | 305.2 | 334.9 | 933.3 | 963.0 | -47.3 | -41.5 | |
| Net financial items | -16.8 | -18.0 | -97.4 | -98.6 | 314.2 | 362.9 | |
| Profit after financial items | 288.4 | 316.9 | 835.9 | 864.4 | 266.9 | 321.4 | |
| Appropriations | - | - | - | - | 0.2 | -0.7 | |
| Tax on profit for the period | -78.3 | -74.6 | -214.3 | -210.6 | 7.7 | -0.8 | |
| Profit/loss for the period Profit/loss for |
210.1 | 242.3 | 621.6 | 653.8 | 274.8 | 319.9 | |
| Attributable to: | |||||||
| Parent Company shareholders | 209.7 | 243.9 | 611.4 | 645.6 | - | - | |
| Non-controlling interests | 0.4 | -1.6 | 10.2 | 8.2 | - | - | |
| Earnings per share (basic), SEK | 1.01 | 1.17 | 2.94 | 3.10 | - | - | |
| Earnings per share (diluted), SEK | 1.01 | 1.17 | 2.94 | 3.10 | - | - |
Statement of comprehensive income
| Group | Parent Company | |||||
|---|---|---|---|---|---|---|
| SEK m. | 2024/25 May–Jul 3 mths |
2023/24 May–Jul 3 mths |
2023/24 Aug–Jul trl 12 |
2023/24 May-Apr 12 mths |
2024/25 Aug–Jul trl 12 |
2023/24 May-Apr 12 mths |
| Profit/loss for the period Other comprehensive income |
210.1 | 242.3 | 621.6 | 653.8 | 274.8 | 319.9 |
| Items that have been, or may later be, transferred to profit for the year: |
||||||
| Translation differences | -21.7 | 79.7 | -58.2 | 43.2 | - | - |
| Items that cannot be transferred to profit for the period: |
||||||
| Revaluation of defined-benefit pensions, net after tax |
- | - | -1.7 | -1.7 | - | - |
| Other comprehensive income | -21.7 | 79.7 | -59.9 | 41.5 | - | - |
| Total comprehensive income for the period |
188.4 | 322.0 | 561.7 | 695.3 | 274.8 | 319.9 |
| Attributable to: | ||||||
| Parent Company shareholders | 188.0 | 323.6 | 551.5 | 687.1 | - | - |
| Non-controlling interests | 0.4 | -1.6 | 10.2 | 8.2 | - | - |
Systemair AB has issued 1,451,240 warrants to persons holding senior positions within the Company.
Summary balance sheet
| Group | Parent Company | ||||
|---|---|---|---|---|---|
| SEK m. | 31/07/2024 | 31/07/2023 | 30/04/2024 | 31/07/2024 | 31/07/2023 |
| ASSETS | |||||
| Goodwill | 1,026.9 | 1,002.6 | 1,025.8 | - | - |
| Other intangible non-current assets | 279.5 | 292.6 | 287.7 | 20.5 | 24.1 |
| Property, plant and equipment | 2,781.4 | 2,577.2 | 2,727.0 | 28.1 | 21.6 |
| Financial and other non-current assets | 251.0 | 188.1 | 240.6 | 3,064.6 | 2,997.8 |
| Total non-current assets | 4,338.8 | 4,060.5 | 4,281.1 | 3,113.2 | 3,043.5 |
| Inventory | 2,124.0 | 2,477.4 | 2,124.0 | - | - |
| Current receivables | 3,021.9 | 2,879.4 | 2,973.3 | 1,265.9 | 1,730.7 |
| Cash and cash equivalents | 425.7 | 429.1 | 414.3 | - | - |
| Total current assets | 5,571.6 | 5,785.9 | 5,511.6 | 1,265.9 | 1,730.7 |
| TOTAL ASSETS | 9,910.4 | 9,846.4 | 9,792.7 | 4,379.1 | 4,774.2 |
| EQUITY AND LIABILITIES | |||||
| Equity | 5,839.7 | 5,592.5 | 5,653.8 | 2,292.6 | 2,374.0 |
| Untaxed reserves | - | - | - | 1.5 | 1.4 |
| Non-current liabilities, non-interest-bearing | 251.6 | 252.7 | 219.5 | - | - |
| Non-current liabilities, interest-bearing | 710.0 | 702.6 | 727.3 | 1,550.5 | 1,438.0 |
| Total non-current liabilities | 961.6 | 955.3 | 946.8 | 1,550.5 | 1,438.0 |
| Current liabilities, interest-bearing | 751.0 | 1,140.2 | 734.9 | 371.7 | 834.8 |
| Current liabilities, non-interest-bearing | 2,358.1 | 2,158.4 | 2,457.2 | 162.8 | 126.0 |
| Total current liabilities | 3,109.1 | 3,298.6 | 3,192.1 | 534.5 | 960.8 |
| TOTAL EQUITY AND LIABILITIES | 9,910.4 | 9,846.4 | 9,792.7 | 4,379.1 | 4,774.2 |
Summary consolidated cash flow statement
| 2024/25 | 2023/24 | 2023/24 | |
|---|---|---|---|
| SEK m. | May–Jul 3 mths |
May–Jul 3 mths |
May-Apr 12 mths |
| Operating profit/loss | 305.2 | 334.9 | 963.0 |
| Adjustment for non-cash items | 147.7 | 125.4 | 331.2 |
| Financial items | -17.1 | -22.5 | -91.9 |
| Income tax paid | -56.5 | -49.3 | -220.0 |
| Cash flow from operating activities before changes in working capital | 379.3 | 388.5 | 982.3 |
| Changes in working capital | -190.9 | -81.8 | 350.9 |
| Cash flow from operating activities | 188.4 | 306.7 | 1,333.2 |
| Cash flow from investing activities | -119.6 | -167.0 | -389.7 |
| Cash flow from financing activities | -44.8 | -70.5 | -898.1 |
| Cash flow for the period | 24.0 | 69.2 | 45.4 |
| Cash and cash equivalents at start of period | 414.3 | 339.9 | 339.9 |
| Translation differences, cash and cash equivalents | -12.6 | 20.0 | 29.0 |
| Cash and cash equivalents at close of period | 425.7 | 429.1 | 414.3 |
Statement of changes in equity – Group
| 2024/25 May–Jul |
2023/24 May–Jul |
2023/24 May-Apr |
|||||||
|---|---|---|---|---|---|---|---|---|---|
| SEK m. | Equity attributable to Parent Company shareholders |
Non controlling interests |
Total equity |
Equity attributable to Parent Company shareholders |
Non controlling interests |
Total equity |
Equity attributable to Parent Company shareholders |
Non controlling interests |
Total equity |
| Amount at beginning of year | 5,645.5 | 8.3 | 5,653.8 | 5,265.7 | 6.8 | 5,272.5 | 5,265.7 | 6.8 | 5,272.5 |
| Dividend | -2.5 | -2.5 | - | -2.0 | -2.0 | -228.8 | -2.0 | -230.8 | |
| Issue of warrants | - | - | - | - | - | - | 2.4 | - | 2.4 |
| Revaluation of acquisition option |
-0.1 | 0.1 | - | -2.6 | 2.6 | - | -80.9 | -4.7 | -85.6 |
| Comprehensive income | 188.0 | 0.4 | 188.4 | 323.6 | -1.6 | 322.0 | 687.1 | 8.2 | 695.3 |
| Amount at end of period | 5,833.4 5,833.4 | 6.3 | 5,839.7 5,839.7 | 5,586.7 5,586.7 | 5.8 | 5,592.5 5,592.5 | 5,645.5 5,645.5 | 8.3 | 5,653.8 5,653.8 |
Key performance measures for the Group
| 2024/25 May–Jul |
2023/24 May–Jul |
2023/24 May-Apr |
||
|---|---|---|---|---|
| 3 mths | 3 mths | 12 mths | ||
| Net sales | SEK m. | 3,111.3 | 3,174.9 | 12,256.6 |
| Growth | % | -2.0 | 11.4 | 1.6 |
| Operating profit/loss | SEK m. | 305.2 | 334.9 | 963.0 |
| Operating margin | % | 9.8 | 10.5 | 7.9 |
| Adjusted operating margin | % | 9.8 | 11.0 | 8.8 |
| Profit after net fin. items | SEK m. | 288.4 | 316.9 | 864.4 |
| Profit margin | % | 9.3 | 10.0 | 7.1 |
| Adjusted profit margin | % | 9.3 | 10.3 | 8.0 |
| Return on capital employed | % | 13.3 | 20.9 | 14.2 |
| Adjusted return on capital employed | % | 14.6 | 17.2 | 15.6 |
| Return on equity | % | 11.1 | 21.4 | 11.8 |
| Adjusted return on equity | % | 12.8 | 15.9 | 13.7 |
| Equity/assets ratio | % | 58.9 | 56.8 | 57.7 |
| Investments | SEK m. | -119.6 | -167.0 | -389.7 |
| Depreciation/amortisation and impairments | SEK m. | 111.4 | 104.7 | 422.1 |
| Per share ratios | ||||
| Earnings per share (basic) | SEK | 1.01 | 1.17 | 3.10 |
| Earnings per share (diluted) | SEK | 1.01 | 1.17 | 3.10 |
| Adjusted earnings per share (basic) | SEK | 1.02 | 1.23 | 3.68 |
| Adjusted earnings per share (diluted) | SEK | 1.02 | 1.23 | 3.68 |
| Equity per share (basic) | SEK | 28.04 | 26.86 | 27.14 |
| Diluted equity per share | SEK | 28.03 | 26.84 | 27.13 |
| Operating cash flow per share (basic) | SEK | 0.91 | 1.47 | 6.41 |
| Operating cash flow per share (diluted) | SEK | 0.91 | 1.47 | 6.41 |
| Average number of shares in period, before dilution | No. | 208,000,000 | 208,000,000 | 208,000,000 |
| Average number of shares in period, after dilution | No. | 208,140,000 | 208,149,000 | 208,110,000 |
Quarterly performance measures – Group
| 2024/25 | 2023/24 | 2022/23 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| May–Jul Feb–Apr | Nov–Jan Aug–Oct | May–Jul Feb–Apr | Nov–Jan Aug–Oct | May–Jul | ||||||
| Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | ||
| Net sales | SEK m. | 3,111.3 | 3,068.8 | 2,826.7 | 3,186.1 | 3,174.9 | 3,128.8 | 3,043.5 | 3,036.7 | 2,848.9 |
| Growth | % | -2.0 | -1.9 | -7.1 | 4.9 | 11.4 | 17.6 | 33.6 | 26.3 | 24.4 |
| Gross margin | % | 36.0 | 35.1 | 33.9 | 33.9 | 34.6 | 34.2 | 34.2 | 33.3 | 34.6 |
| Operating profit/loss | SEK m. | 305.2 | 233.0 | 73.0 | 322.1 | 334.9 | 734.5 | 277.5 | 119.8 | 269.6 |
| Operating margin | % | 9.8 | 7.6 | 2.6 | 10.1 | 10.5 | 23.5 | 9.1 | 3.9 | 9.5 |
| Adjusted operating margin | % | 9.8 | 6.8 | 7.2 | 10.1 | 11.0 | 8.9 | 9.0 | 9.9 | 9.5 |
| Return on capital employed Adjusted return on capital employed |
% % |
13.3 14.6 |
14.2 15.6 |
20.7 16.0 |
23.4 17.1 |
20.9 17.2 |
20.1 16.2 |
13.3 16.4 |
12.4 15.7 |
14.7 15.5 |
| Return on equity | % | 11.1 | 11.8 | 19.9 | 24.2 | 21.4 | 22.6 | 13.3 | 12.2 | 16.1 |
| Adjusted return on equity | % | 12.8 | 13.7 | 13.7 | 15.5 | 15.9 | 16.4 | 18.5 | 17.8 | 17.4 |
| Equity/assets ratio | % | 58.9 | 57.7 | 57.8 | 55.6 | 56.8 | 54.7 | 46.5 | 43.8 | 44.0 |
| Equity per share (basic) | SEK | 28.04 | 27.14 | 25.67 | 26.92 | 26.86 | 25.32 | 22.51 | 21.30 | 19.73 |
| Diluted equity per share | SEK | 28.03 | 27.13 | 25.66 | 26.90 | 26.84 | 25.31 | 22.51 | 21.30 | 19.73 |
| Earnings per share (basic) | SEK | 1.01 | 0.88 | -0.12 | 1.18 | 1.17 | 2.96 | 0.79 | 0.21 | 1.04 |
| Earnings per share (diluted) |
SEK | 1.01 | 0.88 | -0.12 | 1.18 | 1.17 | 2.96 | 0.79 | 0.21 | 1.04 |
| Adjusted earnings per share (basic) |
SEK | 1.02 | 0.78 | 0.50 | 1.18 | 1.23 | 0.77 | 0.77 | 1.06 | 1.05 |
| Adjusted earnings per share (diluted) |
SEK | 1.02 | 0.78 | 0.50 | 1.18 | 1.23 | 0.77 | 0.77 | 1.04 | 1.05 |
| Cash flow from operating activities per share (basic) |
SEK | 0.91 | 0.92 | 1.94 | 2.08 | 1.47 | 0.82 | 1.34 | 0.98 | -0.31 |
| Cash flow from operating activities per share (diluted) |
SEK | 0.91 | 0.92 | 1.94 | 2.08 | 1.47 | 0.82 | 1.34 | 0.98 | -0.31 |
Note 1 Accounting policies
Systemair applies International Financial Reporting Standards (IFRS). This interim report was prepared for the Group in accordance with the Swedish Annual Accounts Act, the Swedish Financial Reporting Board's recommendation RFR 1 and IAS 34 Interim Financial Reporting, and for the Parent Company in accordance with the Swedish Annual Accounts Act and RFR 2.
The interim report has been prepared in accordance with IAS 34 Interim Financial Reporting. The Group applies the same accounting policies as described in the 2023/24 Annual Report.
No other new or revised standards, interpretations or improvements, as adopted by the EU, have affected the Group in any material way.
Note 2 Revenue analysis
The Group's revenue is generated in the main from the manufacture and sale of ventilation products, as well as from the servicing of ventilation products. Total revenue for the quarter amounted to SEK 3,111.3 million (3,174.9), of which servicing of ventilation products accounted for SEK 127.4 million (137.0).
| 2024/25 | 2023/24 | 2023/24 | |
|---|---|---|---|
| May–Jul | May–Jul | May-Apr | |
| SEK m. | 3 mths | 3 mths | 12 mths |
| Europe | |||
| Sale of goods recognised at a specific point in time | 2,080.0 | 2,175.8 | 8,342.3 |
| Sale of goods recognised over time | 29.1 | 19.6 | 97.4 |
| Servicing recognised at a certain point in time | 59.5 | 72.5 | 294.4 |
| Servicing recognised over time | 62.4 | 60.2 | 273.4 |
| 2,231.0 | 2,328.1 | 9,007.5 | |
| Americas, Middle East, Asia, Australia and Africa | |||
| Sale of goods recognised at a specific point in time | 830.2 | 777.6 | 2,988.8 |
| Sale of goods recognised over time | 44.6 | 64.9 | 242.1 |
| Servicing recognised at a certain point in time | 4.8 | 1.7 | 4.5 |
| Servicing recognised over time | 0.7 | 2.6 | 13.7 |
| 880.3 | 846.8 | 3,249.1 | |
| Total | |||
| Sale of goods recognised at a specific point in time | 2,910.2 | 2,953.4 | 11,331.1 |
| Sale of goods recognised over time | 73.7 | 84.5 | 339.5 |
| Servicing recognised at a certain point in time | 64.3 | 74.2 | 298.9 |
| Servicing recognised over time | 63.1 | 62.8 | 287.1 |
| 3,111.3 | 3,174.9 | 12,256.6 |
Note 3 Companies acquired
Companies acquired
Breakdown of purchase consideration for PHEM Engineering SDN. BHD., Malaysia:
| PHEM | |
|---|---|
| Total historical cost, less costs of acquisition | 25.5 |
| Assets acquired | |
| Fair value of assets acquired, net | 14.3 |
| Goodwill | 11.2 |
| Identifiable net assets | |
| Brands and customer relationships | 4.4 |
| Machinery and equipment | 1.2 |
| Inventory | 5.0 |
| Trade accounts receivable | 8.6 |
| Other current assets | 1.9 |
| Cash and cash equivalents | 3.1 |
| Deferred tax liability | -0.7 |
| Interest-bearing liabilities | -0.1 |
| Other operating liabilities | -9.1 |
| 14.3 |
The total impact on cash flow from acquisitions and previously withheld purchase considerations on was SEK -22.5 million. Transaction costs of SEK 0.1 million in connection with the acquisition have been charged to profit in the quarter.
Customer relationships have been measured as the net present value of future cash flows. The useful life of these assets has been estimated at 5 years. The goodwill upon acquisition is attributable to the strong market position of the companies acquired, synergies expected to arise after the acquisition and the company's estimated future earning capacity. Net sales for the acquired company between the time of the acquisition and the end of the period under review totalled SEK 15.0 million. Operating profit for the corresponding period was SEK 2.9 million.
Note 4 Financial instruments
Systemair's financial instruments comprise derivatives, trade accounts receivable, cash and cash equivalents, trade accounts payable, accrued supplier costs, interest-bearing liabilities, acquisition options and additional purchase considerations. Liabilities to credit institutions carry variable interest rates or, in certain cases, fixed rates for a short period. Derivatives are measured at fair value via the income statement on the basis of input data corresponding to level 2 as defined in IFRS 13.
Share purchase options and additional purchase considerations are measured on level 3 as defined in IFRS 13. The calculation for the option to acquire the remaining 10 percent of the shares in Systemair HSK, Turkey, is based on the anticipated earnings before depreciation/amortisation and tax (EBITDA), plus the increase in value of the land and building where the Turkish production facility is situated. Any increase in anticipated profit after tax and any increase in value of the land would result in an increase in the liability relating to the option. No upper limit for the anticipated liability is established in the agreement. Any change in estimated liability is transferred via the Group's equity. No change in the liability was made during the quarter. It is currently valued at SEK 94.3 million. The liability for the acquisition option is recognised as Current liability, non-interest bearing. The calculation for the option to acquire the remaining 40 percent of the shares in Frico A/S, Denmark, is based on the anticipated operating profit (EBIT) for the 2023/24 and 2024/25 financial years. Any increase in anticipated profit after tax would result in an increase in the liability relating to the option. No upper limit for the anticipated liability is established in the agreement. Any change in
estimated liability is transferred via the Group's equity. No change in the liability was made during the quarter. It is currently valued at SEK 16.3 million. The liability for the acquisition option is recognised under Non-current liabilities, non-interest-bearing, on the balance sheet. Other financial assets and liabilities are recognised as current. For that reason, the fair values of all financial instruments are considered to equate approximately to the carrying amounts. Systemair has not recognised any financial assets and liabilities net.
Note 5 Segment reporting
The Group's operations are classified geographically. Systemair aggregates into two geographical segments of (i) Europe and (ii) Americas, Middle East, Asia, Australia and Africa. The market segment Europe accounts for the major share of Systemair's business. The segment Europe consists of a large number of markets. The legal entities within Europe work with each other in manufacturing and sales. The Company also judges that in every material respect similar economic conditions exist in the region, and so the legal entities within the region have been aggregated. Systemair further considers that accounting for the merged segments of (i) Europe and (ii) Americas, Middle East, Asia, Australia and Africa presents a clearer picture. The Parent Company is accounted for via a separate segment, Group-wide. The subsidiaries are aggregated on the basis of their legal domicile and they are consolidated according to the same principles as for the Group as a whole.
| 2024/25 | 2023/24 | 2023/24 | |
|---|---|---|---|
| May–Jul | May–Jul | May-Apr | |
| SEK m. | 3 mths | 3 mths | 12 mths |
| Europe | |||
| Net sales, external | 2,216.0 | 2,328.1 | 9,007.5 |
| Net sales, intra-Group | 64.6 | 38.1 | 183.8 |
| Operating profit/loss | 264.7 | 279.4 | 870.8 |
| Operating margin, % | 11.9 | 12.0 | 9.7 |
| Profit after net fin. items | 261.8 | 376.4 | 1,067.4 |
| Profit margin, % | 11.8 | 16.2 | 11.9 |
| Assets | 6,229.4 | 6,016.9 | 6,259.3 |
| Investments | -80.4 | -74.2 | -241.0 |
| Depreciation/amortisation and impairments | 87.2 | 79.5 | 332.3 |
| Americas, Middle East, Asia, Australia and Africa | |||
| Net sales, external | 895.3 | 846.8 | 3,249.1 |
| Net sales, intra-Group | 10.3 | 4.5 | 36.8 |
| Operating profit/loss | 88.2 | 96.6 | 293.6 |
| Operating margin, % | 9.9 | 11.4 | 9.0 |
| Profit after net fin. items | 70.3 | 51.5 | 186.2 |
| Profit margin, % | 7.9 | 6.1 | 5.7 |
| Assets | 2,438.0 | 2,396.6 | 2,420.6 |
| Investments | -13.8 | -45.9 | -79.0 |
| Depreciation/amortisation and impairments | 20.3 | 18.1 | 72.5 |
| Group-wide | |||
| Net sales, intra-Group | 56.3 | 46.0 | 192.7 |
| Operating profit/loss | -47.7 | -41.1 | -201.4 |
| Profit after net fin. items | -43.7 | -111.0 | -389.2 |
| Assets | 4,389.0 | 4,783.5 | 4,279.7 |
| Investments | -25.4 | -46.9 | -69.7 |
| Depreciation/amortisation and impairments | 3.9 | 7.1 | 17.3 |
| 2024/25 | 2023/24 | 2023/24 | |
|---|---|---|---|
| May–Jul | May–Jul | May-Apr | |
| SEK m. | 3 mths | 3 mths | 12 mths |
| Eliminations | |||
| Net sales, intra-Group | -131.2 | -88.6 | -413.3 |
| Assets | -3,146.0 | -3,350.6 | -3,166.9 |
| Total | |||
| Net sales, external | 3,111.3 | 3,174.9 | 12,256.6 |
| Operating profit/loss | 305.2 | 334.9 | 963.0 |
| Operating margin, % | 9.8 | 10.5 | 7.9 |
| Profit after net fin. items | 288.4 | 316.9 | 864.4 |
| Profit margin, % | 9.3 | 10.0 | 7.1 |
| Assets | 9,910.4 | 9,846.4 | 9,792.7 |
| Investments | -119.6 | -167.0 | -389.7 |
| Depreciation/amortisation and impairments | 111.4 | 104.7 | 422.1 |
Alternative Performance Measures
In the report, Systemair presents performance measures that supplement the financial ratios defined in IFRS; these are known as alternative performance measures (APMs). The Company is of the view that these APMs provide valuable information to investors and the Company's management, in that they enable evaluation of the Company's performance, trends, capacity to pay down debt and invest in new business opportunities, and that they reflect the Group's acquisition-intensive business model.
Because not all companies calculate key financial performance measures in the same way, these APMs are not always comparable. As a result, they should not be regarded as substitutes for performance measures as defined in IFRS. A number of definitions appear below, the majority of which are alternative performance measures.
For more key performance measures and information on how they are calculated, see Systemair's website at: group.systemair.com/investor- group.systemair.com/investor-relations/financial relations/financial relations/financial-information/financial information/financialinformation/financial-data/
Definitions of Key Performance Measures
Number of employees
The number of employees at the end of the accounting period. New employees, appointments terminated, part-time employees and paid overtime are converted into full-time equivalents.
Return on equity
Profit after tax before non-controlling interest, for the trailing 12 months (TTM), divided by average equity excluding non-controlling interest.
Return on capital employed
Profit after financial income, for the trailing 12 months (TTM), divided by average capital employed.
Equity per share
Equity, excluding non-controlling interest, divided by the number of shares at the end of the period.
Adjusted leverage
Net debt in relation to adjusted operating profit before depreciation, amortisation and impairment (adjusted EBITDA).
Adjusted operating margin
Adjusted operating profit divided by adjusted net sales.
Adjusted operating profit
Operating profit excluding restructuring costs, impairments, hyperinflation adjustments and other items aJecting comparability.
LTIFR
Lost Time Injury Frequency Rate. The number of work-related injuries with sickness absence per 1 million hours worked.
Leverage
Net debt in relation to operating profit before depreciation, amortisation and impairment (EBITDA).
Operating cash flow per share
Cash flow from operating activities for the period, divided by the average number of shares during the period.
Organic growth
Change in sales by comparable units, adjusted for acquisitions and foreign currency eJects.
Earnings per share
Profit for the period attributable to Parent Company shareholders, divided by the average number of shares during the period.
Operating margin
Operating profit divided by net sales.
Operating profit (EBIT)
Earnings before financial items and tax.
Equity/assets ratio
Adjusted equity divided by total assets.
Capital employed
Total assets less non-interest-bearing liabilities.
Growth
Growth is defined as the change in net sales, relative to net sales for the preceding period.
Emission intensity
Calculated as total Scopes 1 and 2 emissions divided by Cost of Goods Sold (COGS). As regards both emissions and COGS for all years, any divested operations are disregarded. Similarly those for any acquired activities are taken into account.
Profit margin
Profit after financial items divided by net sales.
Miscellaneous
The information in this Interim Report is information that Systemair is required to disclose in accordance with the Swedish Securities Markets Act (lagen om värdepappersmarknaden) and/or the Swedish Financial Instruments Trading Act (lagen om handel med finansiella instrument). This information is to be submitted for publication at 12.30 p.m. on 29 August 2024.
The interim report has not been audited.
Skinnskatteberg, 29 August 2024
Systemair AB (publ)
Board of Directors
Contact
CEO Roland Kasper
Telephone: +46-(0)73-094 40 13 E-mail: [email protected]
CFO Anders Ulff
Telephone: +46-(0)70-577 40 09 E-mail: [email protected]
Systemair AB (publ)
Co. Reg. No. 556160-4108 SE-739 30 Skinnskatteberg, Sweden Telephone: +46 (0)222-440 00 [email protected]
Calendar
- Interim Report Q2 2024/25 Interim Q2 2024/25 7.00 a.m., 4 December 2024
- Interim Report Q3 2024/25 Interim Q3 2024/25 7.00 a.m., 6 March 2025
- Year-end report 2024/25 end report 2024/25 2024/25 7.00 a.m., 5 June 2025
- Interim Report Q1 2025/26 Interim Q1 2025/26 12.30 p.m., 28 August 2025
- Interim Report Q2 2025/26 Interim Q2 2025/26 7.00 a.m., 4 December 2025
Systemair.com
Telephone: +46 (0)222-440 00 [email protected]
Systemair AB (publ)
Co. Reg. No. 556160-4108 SE-739 30 Skinnskatteberg,
Sweden
Systemair AB | Quarterly report Q3 2023/24 29