Release Date: July 18, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Beijer Ref AB (FRA:BRZ0, Financial) reported a strong Q2 with a 12% sales increase, excluding currency effects, and a 15% increase in EBITDA.
- The company achieved a record EBITDA margin of 12% for the first time, driven by strategic initiatives in private label synergies and acquisition purchasing.
- There was significant growth in the EMEA region, with a 17% increase, and stable organic growth, particularly in Eastern Europe.
- The company experienced strong double-digit growth in its green OEM segment, particularly with SCM Frigo products.
- Beijer Ref AB (FRA:BRZ0) reported a positive cash flow trend, with operational cash flow reaching SEK 1.1 billion year-to-date, up from SEK 900 million last year.
Negative Points
- Currency effects negatively impacted sales by 6%, affecting overall financial performance.
- The North American market faced challenges due to a shortage of refrigerants and adverse weather conditions, impacting sales.
- The APAC region experienced slower market conditions in Australia and New Zealand, particularly in the food retail sector.
- The transition to lower GWP refrigerants in North America is ongoing, with only 30-40% completion in Q2, potentially affecting short-term sales.
- The OEM segment faced setbacks in non-green projects, particularly in heat exchangers, which are expected to improve only in the second half of the year.
Q & A Highlights
Q: Can you explain the cautious customer activity in EMEA and the uptick throughout the quarter? How much stronger was the quarter end versus the start?
A: We observed stable development at the beginning of the quarter, with an acceleration in June that continued into July. This increase is partly seasonal, as activity levels typically rise in June and July. We saw promising activity levels in markets like France, Spain, and Italy, which we haven't seen in a couple of years.
Q: What kind of price contribution are we looking at for North America in the quarter, and how do you see that developing into the second half?
A: In North America, we saw a couple of percent price increase in Q2, and we expect this to rise in Q3 as we transition to new refrigerant solutions. By the end of Q3, we anticipate a full transition, which will carry a 7% to 10% higher price depending on the solution.
Q: You mentioned increased activity on the M&A front. Should we expect deals to close before the end of the year?
A: Yes, we expect to close some deals during the year. We've seen a lot of new activities, especially in the US, over the last four to six weeks. These developments are promising, and we anticipate closing some discussions by the end of the year or early 2026.
Q: Could you elaborate on the record high EBITDA margin this quarter and its sustainability?
A: The margin improvement is driven by initiatives like purchasing and private label strategies. While acquisitions can affect reported margins, the underlying margin development is sustainable. We continue to invest in growth initiatives, such as opening new branches and launching private labels, which balance margin percentages with growth.
Q: Regarding the A2L transition, what level of transition did you experience in Q2, and how does it relate to pricing?
A: In Q2, we were around 40% transitioned to A2L refrigerants. HVAC accounts for about 40% of our sales, with the rest being parts and supplies. The transition is progressing, and we expect to be fully transitioned by the end of Q3.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
