CEO’s comments
2025-06-05
Quarter 4 2024-25
In our fourth quarter, organic growth was 0.5 percent. Given the current economic and geopolitical uncertainties, we are pleased to be able to report organic growth. The trend of gross margin also remained positive and the adjusted operating margin firmed up to 8.7 percent (6.8) in the quarter. This improved performance confirms that our focused efforts are bearing fruit. We made several long-term investments in our production capacity and product portfolio during the year and are well equipped for future growth in a more robust
market.
The market
Sales decreased by 2.2 percent during the quarter, mainly through the impact of a stronger Swedish krona. Adjusted for foreign exchange e/ects and acquisitions, sales rose 0.5 percent. In Europe, positive growth was noted in all regions, especially in Eastern Europe. In North America, sales increased in Canada but decreased in the United States. In the region covering the Middle East, Asia, Australia and Africa, sales declined due to a factory relocation in India. In the period for comparison, major project deliveries were also made in Turkey.
The direct impact of any global trade tariffs on our
business is limited. Our regionalised production, close to our customers, makes us resilient. Only part of our production in Canada is exported to the USA and may
be subject to trade tari/s. However, this could if necessary be managed by moving production to our facility in the USA. The indirect impact of higher component prices will as far as possible be passed on to our customers.
During the quarter, Menerga's last two German agents in the Munich and Leipzig regions were taken over. The acquisitions will result in higher sales margins and more service customers.
Acquisitions & investments
During the year, we finalised a number of investments centred on enabling future growth. In Windischbuch,
Germany, we placed our new 4,500 m2
production and warehousing facilities on stream. In Bouctouche, Canada, we commissioned a new fully automated sheet metal forming production line in our residential units factory. In Dal, Norway, and Milan, Italy, we expanded our existing factories to enable higher production volumes. In the fourth quarter, we also inaugurated our new 19,000 m2 leased production facility in Hyderabad, India, to address the strong growth in that country. Finally, we completed the final stage in the relocation of Menergas' production in Mulheim, Germany, through the sale of the production property, netting a capital gain of SEK 27.8 million. Systemair has a very strong balance sheet, which provides scope for further investments and strategic acquisitions, going forward. Our debt is low and we have a strong cash flow, which creates opportunities for both organic growth and acquisitions.
Sustainability
Our products make an important di/erence in energy savings and indoor air quality. Reducing energy demand – and thus lowering emissions from buildings – is one of the most important issues facing society, if climate impact is to be reduced. For society at large to achieve the climate targets set, major investments in upgrading ventilation in the existing building stock will be needed.
During the quarter, Systemair had its emission targets approved by the Science Based Targets initiative (SBTi), a significant milestone for the Company. We also achieved the target we set earlier to lower our emissions intensity. This was thanks to continued investment and efficiency improvements in our facilities.
It is also pleasing that we continue to see a positive trend in the reduction of work-related injuries leading to sick leave. We will thus meet our annual target of reducing by at least 15 percent the proportion of injuries resulting in sick leave. As a result, by also achieving the Company’s emissions target, Systemair will achieve two of its three prioritised sustainability goals for the year.
Outlook is favourable
Order intake and activity levels are good in several key markets, and we see potential for recovery. We therefore expect a good market development, even though there is uncertainty around several geopolitical factors.
With our well-invested production facilities in 18 countries and the most comprehensive range of energy-eJcient ventilation products on the market, the outlook is favourable for long-term, profitable growth. A local presence based on both sales and production companies in many markets means we are well equipped even in times of geopolitical uncertainty.
Roland Kasper
President and CEO
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Systemair has a well-proven business concept and business model, which is reflected in steadily increasing sales and profit. A large share of our profits are invested in a forward-looking way in increased production development, sustainability initiatives and strategic acquisitions.
