Organic growth and market outlook
Sales for comparable units decreased by 4% during the quarter. September ended strong – is that a sign that the market is turning, and when do you expect to see a recovery in organic growth?
September was clearly the strongest month during the quarter, especially in pulp and paper and steel where we also had some project deliveries during the end of the quarter. We shouldn’t draw too big conclusions from one month – it was partly a catch-up effect after a quiet summer.
We feel that many customers are still a bit cautious and there is a high focus in price which affected our product sales. During the quarter we saw good demand for service and maintenance, which also benefited our gross margins.
We don’t expect a sharp recovery right away, but expect the Group’s customers to remain restrained until a more stable recovery occurs.
Macro indicators vs. customer sentiment
You mention that some macro indicators are turning more positive, but that customers remain restrained. Why do you think that difference exists, and when do you expect them to meet?
That’s a good question. We do see some positive signals in leading indicators, but many of our customers are still very cautious.
Industrial companies have been through several years of uncertainty – energy costs, supply chain disruptions, inflation, currency fluctuation – and they’re prioritising stability and cash flow before new investments.
One likely explanation to the positive indicators such as PMI and also the actual industrial production, is that some industries – such as defence and energy related in Sweden, healthcare in Denmark and O&G in Norway have seen strong demand. Once the improvement becomes more visible and predictable also in our customer segments, we expect activity to pick up gradually. But it will probably be a step-by-step recovery during 2026 rather than a quick rebound.
Comparison with peers and exposure mix
Some other Swedish peers report positive organic growth, while Momentum shows a small decline. Is that due to your market exposure or something company-specific?
It’s mainly about mix and exposure. We have higher exposure to sectors like automotive, mining and energy, which have been softer. Other peers are more exposed to sectors that have recovered a bit faster, and more OEM as well as more sales outside Sweden, we have 80% of our sales in Sweden. Our large aftermarket share and focus on traditional industry gives us stability, but it also means that our recovery often comes a little later when the market turns up.
So it’s really about timing and mix, not about company-specific issues.
Industry business area
In the Industry business area, you mentioned several project transactions completed towards the end of the period. What was the underlying sales trend excluding these, and do you expect similar projects ahead?
If we look at Industry excluding those project transactions, sales would have been slightly weaker, but the overall activity level is quite stable. The project sales is a standard part in our offer but the timing is different from year to year.
All in all, the business area shows good cost control and remains well-positioned for when the market momentum improves.
Infrastructure business area
Regarding service utilisation in Infrastructure, which has impacted margins earlier, what visibility do you have for Q4?
Service utilisation improved in Q3, particularly towards the end of the quarter.
Q4 is normally a busy period for maintenance and service work, so we expect healthy capacity utilisation in our operations. However, as we have also stated, the demand is a bit sluggish and customers have pushed maintenance down the road earlier this year so things can change based on their demand and production plans.
Currency and customer exposure
How is the stronger Swedish krona affecting your customers, and how are you positioning yourselves? Also, how large is your exposure to export-driven industries today?
Niklas:
A stronger SEK mainly affects some of our export-oriented customers in Sweden, for example within automotive and metals which we feel is also an explaining to the cautiousness among these customers regarding their own competitive situation and demand. Add to this also the turbulence from tariffs in general and for sectors such as steel production.
For us, the direct effect is quite limited since most of our business is Nordic and priced in local currency.
A lot of our customers are ultimately dependent on export sales but as we have expanded into infrastructure which is more local that share has decreased over time.
Acquisitions – performance and outlook
Acquisitions contributed SEK 82 million to revenue in the quarter. How do these align with your expectations in terms of profitability and synergies? And how do you view the acquisitions market right now?
The acquisitions we’ve done this year are performing well and already contributing positively to earnings per share.
They bring complementary expertise and strong entrepreneurs into the Group, and integration has gone smoothly.
We’re also seeing more collaboration between companies, which creates both operational and commercial opportunities.
The acquisition market remains active and we see an increase in inflow. Valuations are fairly stable, and sellers continue to prefer long-term industrial owners like us.
With our solid balance sheet, we can continue at a good pace – but as always, we focus on quality before quantity.
Growth ambition and EBITA target
Can you reach your 15% EBITA growth ambition this year without new acquisitions? You’re currently at about 4% year-to-date.
Our long-term target of 15% annual EBITA growth remains fully relevant. It’s an average over time that combines organic and acquired growth.
This year, the softer market has limited organic growth, but margins are solid and the acquisitions contribute well.
What’s important is that we maintain strong profitability and cash generation, which gives us the ability to continue investing and building for the long term.
