Vestum

Highlights of the period July – September 2025

• Net sales amounted to SEK 889 (1,019) million
• Adjusted EBITA amounted to SEK 98 (120) million, corresponding to an adjusted EBITA margin of 11.0% (11.8%)
• EBITA amounted to SEK 95 (133) million, corresponding to an EBITA margin of 10.6% (13.1%)
• EBITA per share before dilution amounted to SEK 0.25 (0.35)
• Operating profit (EBIT) amounted to SEK 23 (62) million
• Cash flow from operating activities amounted to SEK 51 (92) million

Summarising comments by CEO Simon Göthberg
Vestum continues to sequentially strengthen profitability with an adjusted EBITA margin of 11.0% for the quarter, up from 10.1% in the second quarter. At the same time, we are facing challenging comparable figures from the previous year, which is reflected in negative organic growth of 2%. Overall, demand has remained stable since the summer and has partially strengthened towards the end of the third quarter, with September being the strongest month and in line with last year. The change in reported EBITA compared to the previous year was negatively affected by SEK 16 million in non-recurring adjustment items, the majority of which related to revalued contingent considerations in the third quarter of 2024. These items partly explain why the financial net debt in relation to reported EBITDA is slightly higher than in the second quarter, at 2.8x. During the quarter, we have continued to invest in our leading product companies, which is reflected in increased purchases of tangible fixed assets, while growing volumes at the end of the quarter have driven up working capital. The investments primarily relate to geographic expansion in the UK within the Flow Technology segment. As a result, cash flow decreased during the quarter, but for sound reasons.

The Flow Technology segment continues to develop positively across all markets, generating sales growth of 10%, mainly driven by acquisitions. Profitability, measured as EBITA margin, has strengthened from 18.1% to 20.7% compared to the previous year. As in the first half of the year, we are experiencing stable demand and profitability in Scandinavia. In the UK, the market has been preparing for the new investment plan AMP8, under which more than £100 billion will be invested over the next five years to improve water infrastructure. Although these investments have yet to materialise in the market, we are generating solid organic growth in the UK towards the end of the quarter. After the close of the quarter, we completed the acquisition of Dynamic Fluid Solutions, a leading UK supplier of advanced pumping and fluid management systems for complex industrial and environmental applications. This is a strategically important acquisition for the segment, enabling us to accelerate geographic expansion and initiate close collaborations on customer projects and procurement. The market outlook for the segment remains very favourable, and we expect stable development going forward.

Within the Niche Products segment, volumes have developed in line with the previous year, while the EBITA margin has sequentially strengthened from 12.4% to 14.1%. Compared to the same quarter last year, the margin has declined due to challenging comparable figures. We remain focused on further strengthening profitability in the segment.

Within the Solutions segment, we have divested several businesses during the year, including the largest and third largest company, resulting in a decrease in sales in absolute terms. The EBITA margin in the segment has sequentially strengthened from 5.0% to 5.6%, but has declined from 9.1% compared to the previous year. The market continues to be characterised by high competition and price pressure, although we saw some improvement towards the end of the quarter in both volume and pricing. Our focus remains on improving profitability in the segment. The market outlook for the Flow Technology segment remains very favourable for the coming years, particularly in the UK, while there is reason to believe that the market will gradually improve in the other two segments. The combination of solid earnings at the end of the quarter and increased working capital tie-up suggests growing volumes ahead. However, it is too early to determine whether this marks the beginning of a new positive trend characterised by profit growth. Vestum will continue to allocate capital with high discipline, and we look forward to the end of the year and 2026.
 
The Interim Report is available on Vestum’s website: https://www.vestum.se/en/ir/financial-reports/