• Order momentum from Q4 continues, up 18% y-o-y, de-risking '25e
• Stronger margin in both segments, but we extrapolate only in T&D
• Margin expansion in T&D and additional acquisitions key from here

Strong start to the year

In addition to the reignition of M&A activity, Q1 also brought with it another strong report. Order intake grew 18% y-o-y, beating our estimate by 7%. It is good to see that the strong orders of Q4 were not a one-off and that we may now be at healthier levels than we saw throughout most of '24. Sales fell 3%, in line with our estimate, but the adj. EBITA margin of 8.2% (6.5%) beat our expectation of 6.3% quite substantially. This was driven by both segments, with T&Ds 3.9% (4.0%) being 1.9 pp above, and E&Es 17% (9.6%) 3.2pp above our estimate.

Partially extrapolate margin in T&D, E&E volatile

We leave our sales estimates relatively unchanged, but note that they are de-risked by the strong Q1 order intake. While the strong margin was good to see, we are cautious about extrapolating this. Especially in E&E, the margin can be very volatile between quarters, and with the segment already at healthy margin levels, we do not raise our assumptions here. In T&D, however, we feel that the organisational changes in Christian Berner AB and the cost saving measures—which have still to fully come through—were at least partial drivers of the better margin, and thus think this can be extrapolated to a degree, meaning we raise our margin estimates here somewhat. All in all, we raise '25e-'27e adj. EBITA by 9/3/1%. The company stated that it sees limited impact from tariffs, as more than 99% of sales are in Europe, and it has only limited sourcing in the US.

T&D recovery and M&A key going forward

The strong report and return to M&A with the acquisition of Autofric, which will join the E&E segment, are encouraging. Going forward, the key thing to watch for will be margin expansion in the T&D segment, as well