SECOND QUARTER – CONDITIONS FAVOURABLE FOR BUSINESS AND PROFIT GROWTH STILL STRONG
My introduction to the role as new CEO of Addtech has been quite busy. After eight years at Addtech, latterly as Business Area Manager, Power Solutions, the Group’s strategy, business model and corporate culture is in my blood. I am now spending a great deal of time on getting to know the operations in the Group’s other three business areas better. My impressions from these meetings are very positive. In addition, the business climate in most markets where our companies operate remains buoyant. Our organic growth of 5 percent during the quarter, along with several acquisitions, generated strong profit growth. The Group’s operating margin continued to grow, and remained above 10 percent in all business areas during the second quarter.
The overall demand for our products and solutions remained good. From a geographical perspective, we recorded very strong sales growth in all the Nordic countries, and we also benefited from a business climate that remained positive for our operations outside the Nordic region.
With regard to the market in our various customer segments, sales of production components for manufacturing companies in machinery production, electronics, special vehicles and marine increased, with the two last-mentioned contributing significantly. Demand was also strong in wind power and medical technology. The oil & gas customer segment continued to show positive growth, but demand from customers in the telecom segment was weak.
Demand for aftermarket products for the manufacturing industry and for the forest and process industry showed positive growth. We recorded strong sales for electricity-related products for building and installation customers and demand for infrastructure products from power grid companies in the Nordic region was stable.
We are maintaining a high pace of acquisitions. With no less than twelve acquisitions since the beginning of the financial year the overall contribution of acquisitions to aggregate annual sales is approximately SEK 890 million. There are ongoing discussions about acquisitions of independent, profitable technology companies with market-leading niche positions, as well as smaller complementary acquisitions that can strengthen the market positions and profitability of our existing companies. There are great opportunities to make further acquisitions, not least considering our strong balance sheet.
Addtech’s business model and uniquely strong corporate culture have long proved to be highly successful. I look forward with great enthusiasm to continue to develop our excellent business together with all my colleagues, with focus on sustainable profitable growth.
President and CEO