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Investing.com -- Indutrade AB (ST:INDT) saw its shares slide more than 5% Tuesday after the Swedish industrial technology group reported a decline in second-quarter sales and profitability, while order intake held firm.
Net sales fell 4% year-on-year to SEK 8.1 billion, reflecting a lower order backlog, fewer working days, and tough comparisons.
EBITA dropped 11% to SEK 1.1 billion, bringing the EBITA margin down to 13.7% from 14.8%.
Net profit dropped 12% to SEK 639 million, while earnings per share decreased to SEK 1.75.
Order intake was flat at SEK 8.3 billion but exceeded sales, supporting a book-to-bill ratio of 102%. CEO Bo Annvik noted that “around half of all the companies had organic order growth,” with strength seen in energy, medical technology, and pharmaceuticals, while demand in construction, engineering, and process industries remained soft.
Organic sales declined across all business areas, weighing on margins. Still, the gross margin remained stable at 35.3%, and operating expenses were unchanged. Compared with Q1, four out of five business areas posted margin improvements.
Cash flow from operations declined to SEK 735 million from SEK 1,029 million, affected by weaker earnings and adverse working capital movements.
Indutrade’s financial position remains solid, with a net debt/EBITDA ratio of 1.5x and unutilised credit facilities of over SEK 6 billion.
The company completed three acquisitions during the first half of the year, with combined annual sales of about SEK 390 million, and has since added a fourth. Annvik said Indutrade is “well-placed for a good acquisition pace during the remainder of the year,” citing strong deal activity and financial flexibility.
Looking ahead, Annvik acknowledged lingering macro uncertainty but said the company remains optimistic over the long term, pointing to structural growth opportunities in sectors like energy and healthcare.
“We have had a positive book-to-bill ratio for two consecutive quarters,” he said, though he noted that the order backlog is weaker than a year ago.