Sustained organic growth and strong margin increase

Summary by AI ^BETAClose X

Nolato AB reported sales of SEK 2,342 million for the third quarter of 2025, compared to SEK 2,401 million in the previous year. However, operating profit (EBITA) increased to SEK 281 million from SEK 235 million, resulting in an improved EBITA margin of 12.0% versus 9.8%. Profit after tax rose to SEK 215 million, up from SEK 164 million, with earnings per share increasing to SEK 0.80 from SEK 0.61. Cash flow from operating activities was SEK 301 million, slightly lower than the previous year's SEK 327 million. For the first nine months of 2025, consolidated sales totaled SEK 7,190 million, while operating profit reached SEK 829 million, yielding an EBITA margin of 11.5%. Profit after tax for the period was SEK 626 million, and earnings per share amounted to SEK 2.32. Cash flow from operating activities for the nine months was SEK 752 million.

Disclaimer*

Third quarter of 2025 in brief

Sales totaled SEK 2,342 million (2,401)
Operating profit (EBITA) increased to SEK 281 million (235)
EBITA margin of 12.0% (9.8)
Profit after tax was SEK 215 million (164)
Earnings per share, basic and diluted, rose to SEK 0.80 (0.61)
Cash flow from operating activities amounted to SEK 301 million (327)

Business area performance

Medical Solutions sales amounted to SEK 1,311 million (1,355); adjusted for currency, this was an increase of 2%. Operating profit (EBITA) increased to SEK 159 million (145), and EBITA margin rose to 12.1% (10.7). The business area continues to invest in future growth by expanding capacity in Hungary and Poland as well as by establishing operations in Malaysia. The latter strengthens capabilities for further growth in Asia, as well as global production flexibility. The previously communicated customer project in Hungary is running according to plan and validation deliveries have begun. It is estimated that these deliveries will be at around the same levels in the coming quarters and then subsequently increase.

Engineered Solutions sales amounted to SEK 1,035 million (1,046); adjusted for currency, this was an increase of 2%. Operating profit (EBITA) was SEK 120 million (103) and EBITA margin rose to 11.6% (9.8). Sales to the automotive industry increased through higher project invoicing and an upbeat performance for the Hygiene market area, while at the same time previous initiatives in consumer electronics in Asia are yielding results. Implemented cost adjustments, heightened capacity utilization and advanced market positions contributed to the strong margin growth.

Materials saw lower volumes in the quarter in the Automotive segment, resulting in slightly negative growth.

First nine months of 2025 in brief

Consolidated sales totaled SEK 7,190 million (7,282)
Operating profit (EBITA) increased to SEK 829 million (718)
EBITA margin was 11.5% (9.9)
Profit after tax was SEK 626 million (495)
Earnings per share, basic and diluted, totaled SEK 2.32 (1.84)
Cash flow from operating activities amounted to SEK 752 million (897)
Sustained strong financial position

Comments from the CEO

Christer Wahlquist, President and CEO of Nolato AB, commented:

It is gratifying to see that both our business areas continue to grow organically despite a persistently challenging operating environment. At the same time, EBITA margin rose by a full 2.2 percentage points to 12.0% from the comparative quarter, which means that we are already in line with the financial target presented at our Capital Markets Day in March.

Cash flow after investments was slightly lower than last year; note, however, that we are continuing our significant planned investments. Net financial liabilities in relation to operating profit (EBITDA) amounted to 0.6x, thus remaining low. Our acquisition strategy has, in the past, focused on extending our geographical reach to ensure that we can meet our customers’ needs on all continents – a position we have now established. Going forward, focus will shift to complementing our existing business with expertise in new materials and technologies.

Overall, we will continue on Nolato’s strategic journey with increased profitable growth in focus, based on our global capabilities that enable directing business and production to the regions that best meet customers’ needs. Besides, we have a strong financial position that gives us flexibility and enables investing both in new customer projects and bolt-on acquisitions.