In This Article:
Release Date: April 24, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Bufab AB (STU:29B) reported a sales growth of 1.6% in Q1 2025, marking a positive trend after several quarters of negative growth.
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The company achieved a strong gross margin of 30.3%, an improvement from 29.1% in Q1 2024, driven by its trading business.
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The Asia Pacific region showed impressive organic growth of 17.2%, primarily led by strong performance in China.
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Bufab AB (STU:29B) successfully reduced its net debt leverage to 2.5%, aided by loan reductions and positive currency effects.
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The company maintained a strong focus on cost control, resulting in a lower underlying cost base after adjustments for one-offs and restructuring costs.
Negative Points
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Organic growth was slightly negative at -0.1%, indicating challenges in achieving consistent organic expansion.
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The automotive industry in the US faced lower demand, impacting Bufab AB (STU:29B)'s CSG operations negatively.
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The company's cash flow decreased to 164 million SEK in Q1 2025, primarily due to less reduction in inventories compared to the previous year.
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The UK and Ireland region experienced a decline in gross margin by 0.5 percentage points, driven by price pressure in stainless steel.
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Bufab AB (STU:29B) anticipates additional minor restructuring costs in upcoming quarters, which may impact financial performance.
Q & A Highlights
Q: The general market has shown signs of stabilization but remains cautious. Given the positive organic growth trend, do you expect this to continue? A: Yes, we expect this trend to continue. We don't anticipate any major differences compared to the last few quarters, and we foresee a similar trend moving forward. (Eric Lian, President and CEO)
Q: Regarding the US tariffs, growth in the America segment was negative but improved compared to previous quarters. Was there any pre-buying effect in Q1, and how did this shift in April? A: It's difficult to quantify the impact, but there might have been some positive effect on sales numbers at the end of the quarter linked to US tariffs. However, the underlying trend was already moving in the right direction for the RV industry before the tariffs. We don't expect any significant short-term impacts. (Eric Lian, President and CEO)
Q: The gross margin continued to improve year-on-year. How satisfied are you with this development, and what remains to be done? A: I am pleased with the development. We aim for gradual improvement by enhancing our offering and value to customers. I expect continued improvement in gross margin in the coming quarters. (Eric Lian, President and CEO)