• Net sales SEK 571m, 3% vs ABGSCe, 2% vs Factset cons.
• EBITA SEK 83m, 5% vs ABGSCe, 2% vs cons
• Outlook: recovery delayed by uncertainty in the market

Q2 in brief: better overall

Our impression is that Svedbergs Group's Q2 report is better than Factset consensus estimates overall. Svedbergs Group reports net sales of SEK 571m in Q1'25, for an organic growth of 5%. This was 3% vs. ABGSCe and 2% vs Factset cons. By segment, Svedbergs grew -3% y-o-y, still impacted by the lagging primary housing market but an improvement vs the -6% growth it reported in Q1, Roper Rhodes by 3% (~8% org.) and Thebalux by 2% (~6% org.). As such, both Roper Rhodes and Thebalux is likely to have grabbed market share in the quarter, and roper Rhodes' growth accelerated. Gross margins improved 280bp y-o-y driven by previous price adjustments. This was the primary reason for 120bp better EBITA margins y-o-y, for EBITA of SEK 83m. This was +5% vs ABGSCe and +2% vs cons.

Outlook: recovery could be delayed by uncertain customers

In the Q1 report, Svedbergs said it expected Nordics to improve and UK/Netherlands to remain stable, also highlighting that it gains a positive COGS impact from a weaker USD. In the Q2 report, it says the current market climate remains uncertain but manageable, and we assess that the message is of a delayed recovery driven by this uncertainty.

Share trading at 10.4x our '25e EBITA

The share has been strong L3M with a total return of 15%. On yesterday's closing price, it is trading at 10.5x-9x our '25e-'26e EBITA vs a historical standard deviation span of 7x-11x. The Q2 report moves consensus' '25e EBITA by 1% and we believe the market will focus on the strong European organic growth today. Svedbergs hosts a Q&A session today at 10:00 CET, a link can be found here.