What the bad jobs report means for markets
Introduction & Market Context
Volati AB (STO:VOLO) presented its Q2 2025 interim report on July 14, 2025, showing a 6% increase in net sales to SEK 2.317 billion, falling short of the SEK 2.43 billion forecast. The Swedish industrial conglomerate’s stock dropped 3.36% to SEK 109.2 following the announcement, reflecting investor concerns over the revenue miss despite the company’s continued acquisition-driven growth strategy.
The company maintained flat EBITA year-over-year at SEK 245 million while reporting negative organic sales growth of 1%, highlighting the challenging market conditions across its business segments. Volati’s net debt to adjusted EBITDA ratio stood at 3.0x, within the company’s target range but up from 2.7x in Q2 2024.
Quarterly Performance Highlights
Volati’s performance varied significantly across its three business segments. The Salix Group, which contributes approximately 43% of the group’s EBITA, delivered 10% sales growth and a 1 percentage point improvement in EBITA margin to 11%. The Ettiketto Group saw impressive 36% sales growth and 19% EBITA growth, though its margin declined by 2 percentage points due to challenges with Clever Etiketten. Meanwhile, the Industry segment struggled with a 7% sales decline and a 1 percentage point drop in EBITA margin, attributed to difficulties in the Tornum and Corroventa businesses.
As shown in the following chart of quarterly revenue growth, Volati has maintained positive net sales growth despite fluctuating organic growth rates:
CEO Andreas Stenbäck emphasized the company’s first-half performance during the earnings call, noting that "H1 2025 sales increased 10% and EBITA 13%" despite the challenging second quarter. He expressed confidence that "once the market returns, it’s gonna be a real fun journey for us," highlighting the company’s structural readiness for growth.
Detailed Financial Analysis
Volati’s Q2 2025 financial results show the company maintaining its long-term growth trajectory while navigating short-term challenges. The company reported LTM Q2 2025 net sales of SEK 8,242 million (up from SEK 7,597 million in Q2 2024) and EBITA of SEK 702 million (up from SEK 663 million).
The following chart illustrates Volati’s financial development in Q2 2025:
Operating cash flow increased by 27% to SEK 265 million compared to Q2 2024, demonstrating the company’s ability to generate cash despite market headwinds. However, the company’s net debt increased, with the net debt to adjusted EBITDA ratio rising to 3.0x from 2.7x a year earlier, though still within the target range of 2-3x.
Looking at longer-term trends, Volati has maintained a compound annual growth rate (CAGR) of 16% in EBITA since 2019, as shown in the following chart:
However, the EBITA margin has declined from its peak of 10.5% in 2021 to 8.5% in 2025, indicating some pressure on profitability despite continued revenue growth. The company attributes this partly to SEK 7 million in negative one-off items recognized in Q2 related to ongoing structural improvements.
Strategic Initiatives
Acquisitions remain a cornerstone of Volati’s growth strategy. The company completed the acquisition of Hans Eggestrand AB in Q2, adding over SEK 750 million in annual sales. Since 2020, Volati has made 27 acquisitions totaling SEK 4.2 billion in annual sales, demonstrating its commitment to growth through M&A.
The following visual illustrates Volati’s acquisition activity since 2020:
The company’s add-on acquisition strategy has been a key value driver, with M&A contributing annual sales of SEK 600-1,200 million over time. These acquisitions are described as value-creating add-ons that enable substantial synergy realization.
As shown in the following chart of acquired annual turnover and number of acquisitions:
Volati is also implementing long-term structural measures to strengthen margins across its business units, particularly in Salix, S:t Eriks, and Communication. Management expects these improvements to drive further margin enhancement over time, positioning the company for stronger performance when market conditions improve.
Segment Performance Analysis
Salix Group, Volati’s largest business area contributing approximately 43% of group EBITA, showed strong performance with 10% sales growth and improved margins. The segment has benefited from previous structural measures and acquisitions, as illustrated in the following performance chart:
Ettiketto Group, contributing about 29% of group EBITA, delivered the strongest growth with a 36% sales increase and 19% EBITA growth. However, margin pressures from Clever Etiketten affected overall profitability. The segment’s long-term performance shows impressive growth from SEK 251 million in sales in 2019 to SEK 1,091 million in Q2 2025:
The Industry segment, accounting for approximately 28% of group EBITA, faced the most significant challenges with a 7% sales decline. This underperformance was attributed to difficulties in the Tornum and Corroventa businesses, though the Communications division delivered solid results. The segment’s performance trend is shown below:
Forward-Looking Statements
Volati’s management expressed optimism about future growth despite current market challenges. The company expects strong cash flow in the second half of 2025 and anticipates accelerated organic growth and gradual net debt reduction once markets normalize.
The company remains well-positioned for continued growth through acquisitions, with platforms, financial capacity, and processes in place to support this strategy. Management highlighted that structural improvements across business units are ongoing and expected to drive further margin improvement over time.
However, investors should note potential risks, including continued market slowdown affecting sales growth, restructuring costs impacting short-term profitability, competitive pressures particularly in the Industry segment, and macroeconomic uncertainties influencing the timing of market recovery.
With a current stock price of SEK 109.2, down 3.36% following the earnings announcement, Volati is trading closer to its 52-week low of SEK 86.7 than its high of SEK 127.6, potentially reflecting investor caution about near-term performance despite the company’s long-term growth story.
Full presentation:
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