Q1 2025 Ferronordic AB Earnings Call Transcript
Key Points
- Ferronordic AB (OSTO:FNMA PREF.PFD) reported a 3% increase in revenue to SEK1.2 billion despite market uncertainties.
- The company successfully reduced its net debt to SEK1.8 billion, indicating improved financial management.
- Inventory levels in Germany were reduced by 59% compared to the end of Q1 2024, addressing previous supply chain issues.
- The electric truck rental business in Germany continued to contribute positively to the company's performance.
- Kazakhstan's revenue increased by 26%, driven by growth in the mining and construction sectors.
- Gross profit declined due to an unfavorable revenue and product mix, impacting the overall profitability.
- The US construction equipment market saw a 5% decline, with Ferronordic's sales of new equipment and rental fleet sales decreasing by 6% in units.
- The German truck market decreased by 28% during the quarter, affecting Ferronordic's sales performance.
- Net income significantly decreased to SEK150 million, largely due to foreign exchange effects.
- The company faced challenges in recruiting qualified mechanics, limiting its ability to meet the demand for service and parts.
Welcome to the Ferronordic Q1 2025 Report Presentation. (Operator Instructions)
Now I will hand the conference over to speakers, CEO, Lars Corneliusson; and CFO, Erik Danemar. Please go ahead.
Thank you. This is Lars Corneliusson here and welcome to the report on our first quarter of 2025. And if we can press -- sorry. And we call the report steady despite uncertainty.
And obviously, there are -- there is increased uncertainty in our markets and in our industry. We will obviously come back to that. And despite that uncertainty, our revenue actually increased by 3% to SEK1.2 billion. However, we saw a decline in gross profit and that was partly due to revenue and product mix.
And selling and administrative costs came down. And that was partly thanks to cost reduction that we have entered upon and lower sales commissions. So we had an operating result, which decreased to SEK13 million, which was mainly a result of the lower gross margin. We also had net
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