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SEATEC, a leader in electric vehicle (EV) charging and low voltage solutions, reported its Q1 2025 earnings, revealing a revenue of $213 million, surpassing the forecasted $204.3 million. The company’s stock reacted positively, climbing 15.59% to $14.68 in pre-market trading, driven by strong financial performance and strategic operational updates. According to InvestingPro, the company maintains a GOOD overall financial health score, suggesting solid operational stability despite market challenges.
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Key Takeaways
- Revenue exceeded expectations at $213 million, compared to the forecast of $204.3 million.
- Stock price surged 15.59% following the earnings release.
- Significant growth in the DACH region, with nearly 60% year-over-year increase.
- Positive EBITDA achieved in the Professional Division for the first time.
- Strategic cost reductions in production have enhanced profitability.
Company Performance
SEATEC demonstrated robust performance in Q1 2025, driven by strong sales in EV charging and low voltage markets. The company reported a 5% organic growth, supported by strategic cost controls and efficiency improvements in its Professional Division. SEATEC’s competitive production flexibility, particularly its operations in Malaysia, has provided tariff advantages, bolstering its market position.
Financial Highlights
- Revenue: $213 million, exceeding the forecast of $204.3 million.
- Gross Margin: 56.4%
- EBITDA: SEK 19 million
- Cash Flow: SEK 8 million
- Net Debt Ratio: 1.9
Earnings vs. Forecast
SEATEC’s revenue of $213 million exceeded the forecast of $204.3 million by approximately 4.3%. This positive surprise reflects the company’s effective execution of its strategic initiatives and strong market demand, particularly in the DACH region.
Market Reaction
Following the earnings announcement, SEATEC’s stock price surged by 15.59%, reaching $14.68. According to InvestingPro data, the stock is currently trading at $4.45, showing a -31.27% return over the past year. While the stock has faced challenges, trading 62% below its 52-week high of $7.26, analysts predict the company will return to profitability this year.
Outlook & Guidance
Looking ahead, SEATEC is entering the third phase of its strategic plan, focusing on accelerated growth and targeting a CapEx of 6-8% of turnover. The company has scheduled a Capital Market Day for May 22 to elaborate on its growth strategies and future initiatives.
Executive Commentary
CEO Henrik Fagrenius commented, "We are now well into phase two, which is profitability and focus on organic growth." He emphasized the company’s consistent organic growth over the past four quarters and its readiness to pursue accelerated growth.
Risks and Challenges
- Currency fluctuations could impact financial results, as noted in the earnings call.
- Supply chain disruptions, particularly in Asian production sites, may pose challenges.
- Market saturation in EV charging could limit growth potential.
- Macroeconomic pressures and potential tariff changes could affect profitability.
Q&A
During the earnings call, analysts inquired about the company’s North American market strategy, given that it represents less than 10% of total sales. SEATEC’s management highlighted its focus on expanding market share and maintaining stable demand despite turbulent market conditions.
Full transcript - Ctek AB (CTEK) Q1 2025:
Conference Operator: The participants will be in listen only mode. Now I will hand the conference over to the speakers’ CEO, Henrik Fagrenius and CFO, Tom Matheisen. Please go ahead.
Henrik Fagrenius, CEO, SEATEC: Thank you, operator, and a warm welcome to all of you to today’s Q1 presentation for 2025 for SEATEC. The presenters today is myself, Henrik Fajenius and our CFO, Tom Matthiesen. And as always, I start with a short recap of SEATEC. SEATEC was founded more than twenty five years ago by Benk Valkwist, the happy guy on the picture, and he invented the first ever smart charger with pulse technology. We are delivering we we are developing and testing and designing everything in Sweden, and we have production mainly in Asia and China, but also in Malaysia.
We have more than 50 premium brands for choosing C Tech as their charger, and I’m very proud to show the Lamborghini that is actually cobranded with C Tech, which is extraordinary and says a lot about our quality. C Tech has mainly two different technologies. We have the EVSE technology where we are focusing on destination charging, And then we have our low voltage, where we are present in different segments as consumer, professional, workshop, client, brand and integrated solutions. You will find SEATEC in a vast area of different usage alternatives for the electrical vehicles and plug in hybrids. We can sell our EV chargers, of course, but also our 12 volt chargers and our workshop chargers.
For the combustion engines, we have our 12 volt chargers and our workshop chargers. And for RV and leisure, like motorcycle, camper vans, etcetera, we have our low voltage and also our integrated solutions. And for industrial, we have integrated solutions. We are distributing in mainly two divisions. We have the professional divisions that is focusing on business to business.
They have the OEM car brands and also big parking operators and sharp point operators. And then we have a consumer division, which are selling into retail and e tail. So then over to the first quarter of twenty twenty five. We were growing for the fourth consecutive quarter and the sales or revenue came in at $213,000,000, which is a growth organic growth of 5%. Gross margin ended up at 56.4%, very strong due to a good product mix.
EBITDA SEK 19,000,000, impacted by non realized FX impacts and cash flow SEK 8,000,000. And we came in on a net debt ratio of 1.9, so very stable financial situation. If we look a little bit more deeper into the figures, we have consumer division, which was actually growing for the seventh consecutive quarter. Strong sales in North America, strong online sales and so our efforts there is paying off. I’m very happy to say that the Professional Division showed a positive EBITDA for the first quarter since we started about the division, and that was due to growth in client brand, where we had good sales to Europe’s biggest motorcycle manufacturer.
And we also see better margins on our newly introduced CC Free EV charger. So with this, I think we are very good placed for soon entering into our third phase. And we would talk more about that in our Capital Market Day in the May 22. So with that, I leave over to you, Tom.
Tom Matthiesen, CFO, SEATEC: Yes. Thank you, Henrik. So some more words around the financials, and I go a step down to the divisions. And as you can see, the consumer division on the graph on the upper side right, you can see that stands for more than two thirds, so we’re around two thirds of the turnover of the company. Here, we have grown again, organically.
We have 7% with a stable and good EBITDA margin of around 35. So continuous good performance in the Consumer division. Coming over to the Professional division, which stands for one third of the turnover of the company, we are happy to say that we have the first profitable quarter since we started the new organization in end of twenty twenty three, with a positive EBITDA of around 6%. That comes, as Hendrik mentioned, both from the strong low voltage sales to the OE customers, but also from improved margins on the EVSE side of the business. Around cash flow and CapEx, which is quite important areas, of course, for a company like SEATEC.
We continue to have a positive cash flow from operating activities, a bit less than last quarter one last year, but that is mainly reflecting some bigger payments in and out at this periodical impact of that. So as we mentioned a little bit later in this in the fourth bullet, we see a long term positive cash flow trend. That also means that we did an extra amortization of our loan with €25,000,000 per period. CapEx, as we have said before, it’s now coming back on the more normal levels, around 8% so far this year of the turnover. And we, over time, see that being somewhere in the area of 6% to 8%.
Net debt to ratio, also an improvement versus quarter one last year from down to 1.9% from 2.2 at the end of quarter one last year. So by that, I hand it over to you again.
Henrik Fagrenius, CEO, SEATEC: Thank you, Tom. So to summarize the quarter, moving back to the our strategic plan that we put together a little bit more than one and a half year ago, and we put it into three phases where the first phase was to create stability and cost control. We left that phase a year ago, and we are now well into phase two, which is profitability and focus on organic growth. We have now showed four quarters of organic growth, and we are getting ready to talk about more accelerated growth, which we will present at our Capital Market Day, the May 22. So most welcome, and I hope to see you all there.
Going into the quarter again. As I mentioned, fourth quarter of consecutive growth for the group and seventh quarter of consecutive growth for Consumer division. First ever quarter with positive EBITDA in Professional Division, and that relates to high sales of client brand and also a better gross margin for our newly introduced CC Free EV charger. So we have a very stable financial situation and net debt ratio well below our financial targets. So we are ready for our next phase, which we will present on our Capital Market Day, the May 22.
And with that, I open up for questions.
Conference Operator: The next question comes from Johan Eliason from Kepler Cheuvreux. Please go ahead.
Johan Eliason, Analyst, Kepler Cheuvreux: Yes. Hi. This is Johan at Kepler Cheuvreux. I have a question just regarding your North American exposure. You mentioned that as a growth driver in this quarter.
How big is North America for you today now when the GM contract is out of the numbers? And how do you supply it
Matthias Ehrenborg, Analyst, Redeye: basically? That’s my first question.
Henrik Fagrenius, CEO, SEATEC: Good morning, everyone, and thank you for the question. North America was last year without GM a little bit less than 10% of our total sales. We moved the production to Malaysia for 80% of our total of 80% of our products to Malaysia. And the tariff is hard to foresee, but my judgment today is that we are in a pretty good spot. I think it’s neutral due to competition because I do not believe that there is anyone producing locally in in America, and all our competitors are producing in Asia.
And with the move to Malaysia, I think we are in a relatively good spot as it is today.
Johan Eliason, Analyst, Kepler Cheuvreux: Guess the question that you say 80% Malaysia, is that for The U. S. Or North American sourcing or is that for your total No.
Henrik Fagrenius, CEO, SEATEC: That is for the North American sourcing.
Johan Eliason, Analyst, Kepler Cheuvreux: Yes. Okay. Excellent. Well, I’m looking forward to the May 22. So I have no further questions right now.
Thank you very much.
Conference Operator: The next question comes from Matthias Ehrenborg from Redeye.
Matthias Ehrenborg, Analyst, Redeye: Henrik and Tom Matthias here from Redeye. First off, I just want to congrats on a solid quarter. A few questions from my side. Could you share if there’s any main driver behind the positive EBITDA in the Professional segment? Or is it more a general result from your cost savings and, I guess, overall solid demand in all product categories and customer groups?
Henrik Fagrenius, CEO, SEATEC: Morning, Matthias. Yes, it is we have reduced the cost quite significantly in that division. And as we mentioned previous, it’s up to getting volumes now to get a positive EBITDA, and that we managed to do in the first quarter. So it was a good growth in client brand, which is the low voltage chargers for our premium customers. But we also had a stable sellout of our EVSE destination.
So if we remove the GM contract, we have a stable sellout of EVSE destination with a better margin, which also helps to have a positive EBITDA.
Matthias Ehrenborg, Analyst, Redeye: Okay. And then did you have any positive one off effects from the discontinued GM contract in this quarter? No, not at all. Okay. Excellent.
I think this already has been answered a bit in the previous question. But then could you describe your U. S. Business in the quarter and your and how your customers are feeling in the region?
Henrik Fagrenius, CEO, SEATEC: If we start with the quarter, it was very good sentiments. We had high sales, especially on our online channels. We when with the move, we managed to reduce our pricing a bit with kept margins, and that we saw positive take up from our customers in North America. So as I mentioned before, 80% we have now produced in Malaysia. And at the moment, the tariffs from Malaysia is 10%.
We don’t know how that will develop, but it’s relatively good for us compared to some of the competitors, I think. So we look positive at that. Then, of course, it’s very hard to say anything about the future and the sentiment of our customers and consumers in North America at the moment.
Matthias Ehrenborg, Analyst, Redeye: Yes, understood. If we just look at the Q1 numbers, you had SEK70 million roughly in sales from Americas and you had SEK21 million in Q1 last year. If we remove the GM volumes from last year, what would be a representative number, would you say?
Henrik Fagrenius, CEO, SEATEC: In North America specifically?
Matthias Ehrenborg, Analyst, Redeye: Yes, exactly. So if we remove the GM numbers from there,
Henrik Fagrenius, CEO, SEATEC: don’t reveal that on that detail, but I can say that we had a good sales development if we clear for GM activities.
Matthias Ehrenborg, Analyst, Redeye: Okay. Okay. Excellent. Thank you. And then if we move over to the DACH region, it grew by, yeah, I think nearly 60% year over year, which looks very high.
What are the reasons behind this development in the quarter?
Henrik Fagrenius, CEO, SEATEC: We had also a very, very strong online sales, but also our professional workshop charters are developing really, really nicely and especially in the Dutch region.
Matthias Ehrenborg, Analyst, Redeye: Okay. So it’s not there aren’t any timing effects to that and the Q4 last year, for instance, instead of going to Q1 or it’s just pure demand driven, would you say?
Henrik Fagrenius, CEO, SEATEC: It’s very hard to say if it’s timing effects because you always have there could be timing effects between the quarters. But we are, of course, closely monitoring the underlying sellout at our especially our big online or e tailers, and we see a very healthy growth in those figures.
Matthias Ehrenborg, Analyst, Redeye: Okay. Thanks. And just regarding the development for the CC3, especially in The UK then in the quarter. What was the development like? And what do you expect now heading into the summer months?
Henrik Fagrenius, CEO, SEATEC: We if we take CC Free, our short storm connected free, it has been very well received by the customers. The UK sales have not really taken off yet. So it’s hard to say. We are working closely with our customers in UK and also in Scandinavia. And later on, we will also launch it in Germany, as you know.
But so far, we have seen a stable demand in a very, very turbulent times.
Matthias Ehrenborg, Analyst, Redeye: Okay. Thank you. Understood. And just a final question from my side. Could you expand a bit on the Q1 net finance of minus SEK 30,000,000 as they look quite high?
Tom Matthiesen, CFO, SEATEC: Yeah. I can take that question, Thijs. So, it’s actually, we are impacted both in in financials and net finance finance net and and on the operating result of non realized FX impacts, you know, when the corona has been stronger against both US dollars and euros. We have some impacts on that. And and on the finance net, it’s primarily that we have quite a lot of euros on our accounts, and they are evaluated to 1 krona less per euro than during the quarter.
So that is the main impact. So around 8,000,000, 9 million of that impact is just non realized FX impact.
Matthias Ehrenborg, Analyst, Redeye: Okay. Thank you. That was very clear. Okay. That was all from my side.
Thank you very much for taking all my questions.
Tom Matthiesen, CFO, SEATEC: Yeah. Thank you, Matthias. Thank you, Matthias.
Matthias Ehrenborg, Analyst, Redeye: Thank
Conference Operator: Marias.
Henrik Fagrenius, CEO, SEATEC: You very much for listening in to our Q1 report and looking forward to see you with May 22 in Stockholm. Thank you so much.
Matthias Ehrenborg, Analyst, Redeye: Bye bye.
Tom Matthiesen, CFO, SEATEC: Thank you.
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