Third quarter

• Order intake increased by 11 percent to 505 MSEK (456), adjusted for currency effects and acquisitions it increased by 3 percent.
• Net sales increased by 10 percent to 544 MSEK (493), adjusted for currency effects and acquisitions, it was stable.
• EBIT increased to 63.0 MSEK (50.8).
• EBIT margin strengthened to 11.6 percent (10.3).
• Profit after tax increased to 40.4 MSEK (31.1).
• Earnings per share improved to 1.26 SEK (1.08).
• Free cash flow amounted to 29.9 MSEK (55.6).
• After the end of the period, the Westermo business entity entered into an agreement to acquire a minority stake in RazorSecure, a British software company that is a leader in cybersecurity for the train industry. The investment amounts to 2.7 million pounds.

Nine months

• Order intake increased by 10 percent to 1,614 MSEK (1,467), adjusted for currency effects and acquisitions it increased by 8 percent.
• Net sales decreased by 2 percent to 1,649 MSEK (1,680), adjusted for currency effects and acquisitions, it decreased by 5 percent.
• EBIT was 173.7 MSEK (185.4).
• EBIT margin was 10.5 percent (11.0).
• Profit after tax was 102.7 MSEK (122.1).
• Earnings per share were 3.35 SEK (4.22).

COMMENTS FROM THE CEO, JENNY SJÖDAHL

“In a market still characterized by uncertainty and caution, Ependion reports a clearly improved result and strengthened margins for the third quarter of 2025. This shows that our business entities have the ability to balance a focus on profitability with future-oriented investments to strengthen our offering and advance our positions.

Ependion’s order intake for the third quarter increased by 11 percent to 505 MSEK. Adjusted for acquisitions and currency effects, the increase was 3 percent. For the Westermo business entity, order intake increased by 10 percent to 305 MSEK. Excluding the acquisition of Welotec and adjusted for currency effects, order intake decreased by 6 percent, mainly due to a seasonally weaker period for the train segment. The Beijer Electronics business entity reported an increase in order intake by 12 percent to 201 MSEK, where the growth rate for the core HMI offering was 22 percent. At the end of the period, the Group’s order backlog amounted to 1,052 MSEK, of which Westermo accounted for 928 MSEK and Beijer Electronics for 124 MSEK.

The Group’s net sales increased by 10 percent during the quarter to 544 MSEK, adjusted for acquisitions and currency effects, the development was stable. Westermo reported a sales increase of 24 percent to 334 MSEK.

The recently acquired Welotec developed positively and accounted for the business entity’s growth in the period. During the quarter, Westermo was affected by an unplanned production stoppage due to a lightning strike at the Stora Sundby plant. Despite extensive efforts to catch up, deliveries were negatively affected by approximately 10 MSEK in the period. In the Beijer Electronics business entity, sales amounted to 210 MSEK, which was a decline compared to the previous year. The period did not include any sales of the phased-out low-margin products, which improved the sales mix in line with the strategy.

Strengthened gross margin and good cost control contributed to improved profitability for the Group in the third quarter. The Group’s EBIT increased to 63 MSEK, corresponding to an EBIT margin of 11.6 percent. The Westermo business entity reported an improved EBIT of 48 MSEK with an EBIT margin of 14.3 percent and Beijer Electronics’ EBIT amounted to 26 MSEK with a margin of 12.3 percent. Beijer Electronics continues to improve sequential profitability. The Group’s free cash flow was 30 MSEK, a decrease compared to the previous year, which is explained by the fact that the largest improvements in inventory levels were implemented in 2024.

As in the previous period, currency effects have had a noticeable impact on the Group’s accounts. The stronger Swedish krona and the weakening of the US dollar compared to the previous year had a negative impact on EBIT by 12 MSEK and negatively affected both order intake and sales comparisons by 4 percentage points.

As planned, the Group’s product development expenses during the period decreased to 70 MSEK, corresponding to 12.9 percent of Group sales. Beijer Electronics’ new generation of operator panels – the X3 series – is now complete and available to customers, which means that the intensive development work is entering a calmer phase.

The strongly growing defense sector is a segment where robustness and reliability are important requirements, something that Ependion places great emphasis on. Both business entities currently have customers in the defense sector and during the period, a group-wide work was initiated to evaluate the possibilities of strengthening positions in this area.

After the end of the period, the Westermo business entity has entered into an agreement to acquire a minority stake in the British software company RazorSecure Limited, a leading player in cybersecurity solutions for the train industry. The investment amounts to GBP 2.7 million. The agreement also includes a strategic collaboration in technology and business development, as well as an option to acquire the entire company after the end of the 2027 financial year. This investment strengthens Westermo’s position in the growing area of secure and reliable network solutions for the railway sector.

The acquisition of Welotec, which was completed in the second quarter of this year, has developed very well. The company continues to grow, and the integration is progressing as planned. We clearly see how the combination of Welotec’s expertise and our joint broader offering is generating new business opportunities and strengthening our position in the growing energy market.

Ependion is well positioned in attractive markets. The strategic investments and continuous improvements we are driving make us well equipped for the future. In the medium and long term, our prospects for profitable growth are very good given the structural growth in our focus segments. In the short term, uncertainty remains, and we focus on what we can influence. We balance cost discipline with strategic future investments and are focused on creating value, regardless of the market situation.”

INVITATION TO PRESENTATION OF THE REPORT

Today a web and teleconference will be held for press and analysts, where President and CEO Jenny Sjödahl and CFO Joakim Laurén present the company and comment on the report.

Time:       Tuesday, October 21, 13:30 CET

If you wish to participate via webcast please use the link below.
https://ependion.events.inderes.com/q3-report-2025/register

If you wish to participate via teleconference please register on the link below. After registration you will be provided phone numbers and a conference ID to access the conference. You can ask questions verbally via the teleconference. 
https://events.inderes.com/ependion/q3-report-2025/dial-in

The report and the presentation will be available at the company’s website www.ependion.com. A recording of the webcast will also be available here after the event.

Welcome to join!