Q2 2025 HMS Networks AB Earnings Call Transcript
Key Points
- HMS Networks AB (FRA:4H3A) reported an adjusted EBIT margin of 21.4%, showing improvement from the previous year.
- The company achieved a strong cash flow of SEK201 million for the quarter, indicating effective management of inventory and cash flow items.
- The I&T division showed positive development with a 15% organic increase in order intake, driven by recovery in Europe and strong performance in APAC, particularly China.
- The company maintained a book-to-bill ratio of over 1, indicating a healthy balance between orders received and sales.
- HMS Networks AB (FRA:4H3A) is investing in production facilities in York and Pennsylvania, aiming for improved margins and operational efficiency in the future.
- Net sales were flat compared to the previous year, impacted by currency effects and market uncertainties.
- The IDS division experienced a 14% decline in reported sales, partly due to internal delays and market conditions.
- Tariffs have created uncertainty, affecting larger projects and contributing to a cautious market environment.
- The New Industries division faced challenges with a hesitant market in building automation and headwinds in vehicle communication.
- Gross margins were slightly lower than expected, impacted by tariffs and currency fluctuations.
Welcome to the HMS Networks Q2 presentation for 2025 during the questions-and-answer session. (Operator Instructions)
Now I will hand the conference over to CEO, Staffan Dahlstrom; and CFO, Joakim Nideborn. Please go ahead.
Thank you, operator. Good morning, everybody. Welcome to this HMS Networks Q2 report. We follow the standard format we normally do. So I will start with a short business update from this eventful quarter, and then Joakim will give a financial summary and allow you -- a deep dive into the numbers, and then we'll finish up with a Q&A at the end.
But let me start with a very quick overview of the mix picture we are seeing in the quarter-two and remember that we made a big acquisition in April '24. So this also now means that the Red Lion acquisition is part of our organic growth after 12 months.
So, we see a mixed picture both on net sales, where we are more or less flat. But behind this is also some currency changes and things we also made
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