Q2 2025

• Net sales amounted to SEK 266 (264) million,
  an increase of 1 percent compared with the same period in 2024, of which organic growth accounted for 1 percent
• Adjusted EBITA amounted to SEK 19 (18) million, corresponding to a margin of 7 (7) percent
• EBITA was SEK 15 (25) million, corresponding to a margin of 6 (9) percent
• Operating profit/loss (EBIT) amounted to SEK 9 (-16) million
• Basic and diluted earnings per share amounted to SEK 0.04 (-0.65)
• Cash flow from operating activities was SEK 30 (40) million, affected by a tax deferral repayment of SEK -3 (-2) million.

The period January – June 2025

• Net sales amounted to SEK 473 (482) million, -2 percent compared with the same period in 2024, of which organic growth accounted for -2 percent
• Adjusted EBITA amounted to SEK 25 (24) million, corresponding to a margin of 5 (5) percent
• EBITA was SEK 21 (30) million, corresponding to a margin of 4 (6) percent
• Operating profit/loss (EBIT) amounted to SEK 9 (-18) million
• Basic and diluted earnings per share amounted to SEK -0.13 (-0.77)
• Cash flow from operating activities was SEK 9 (39) million, affected by a tax deferral repayment of SEK -16 (-3) million.

Significant events during and after the reporting period

• The financing agreement with a major Nordic bank was extended in May by one year (to Q1 2027), with new covenant levels.
• On July 14, Seafire’s subsidiary Pexymek entered into an agreement concerning a divestment of the real estate company Mastöret Fastighet AB.
• On August 18, Per Bodén took up the role of CFO, while Keivan Cherloo took up the role of COO at Seafire.

CEO Comments

Net sales during Q2 amounted to SEK 266 (264) million, corresponding to growth of 1 percent, which means the first quarter of organic growth for the Group since Q1 2023. Adjusted EBITA during the quarter amounted to SEK 19 million (7 percent), slightly up on the previous year (SEK 18 million, 7 percent).
 
Stable net sales
Five of twelve subsidiaries showed growth during the quarter which began weakly, affected by the global trade turbulence that led to a cautious attitude among the subsidiaries’ customers. The market improved at the end of the quarter and ten of twelve subsidiaries recorded growth in June. Borö-Pannan showed signs of recovery compared with a weak comparative quarter, and SolidEngineer also showed strong growth. Nordbutiker’s net sales decreased by 8 percent, mainly as a result of a very weak April, when consumer confidence was at a record low, but the recovery in June proved to be strong. For the subsidiaries within the construction sector and the ROT/renovation, an increase in activity levels was apparent among customers, along with a more positive future outlook, and our assessment is that we have now reached a plateau from which we can grow.
 
Improved results driven by implemented measures
The focus on profitability is continuing and delivered effects during the quarter. During Q2, the gross margin improved by two percentage points to 48 (46) percent and seven of twelve companies showed improvement. Of particular note is Nordbutiker, which increased its gross margin by 5 percentage points as a result of active work on procurement and pricing, thereby improving its earnings despite lower net sales. SolidEngineer showed strong earnings growth driven by good cost control under new leadership. The cost base is stable, and we need growth and further gross margin improvement in order to drive earnings growth. We are reviewing and discontinuing unprofitable business, which is expected to increase margins, reduce tied-up capital and release resources for areas where we want to grow.
 
Strong cash flow, extended financing agreement and value-creating real estate transaction
Cash flow from operating activities was strong during Q2 at SEK 30 (40) million. The comparative period was positively affected by the reduction in excess stock within Nordbutiker. The process of reducing our working capital structurally is continuing. At the end of the quarter, net debt amounted to SEK 208 (199) million, while the debt ratio (net debt/EBITDA) amounted to 3.8x including the tax deferral, and 2.9x excluding it. In May, Seafire extended the existing financing agreement with a major Nordic bank by a further year (to Q1 2027). The extension entails amended covenants and unamended (good) commercial terms and conditions.
 
In July, Pexymek signed an agreement to divest its production real estate to Logistri. The valuation is attractive, and we consider it good capital allocation to create flexibility for investments in the core business and add-on acquisitions.
 
New management team and governance model
In August, Per Bodén and Keivan Cherloo took up their new roles as CFO and COO respectively. In Per and Keivan, we are taking onboard individuals with strong profiles and a strategic perspective combined with an interest in entrepreneurship and operational issues. We have also implemented the final stages of the previously communicated changes to our governance model in order to accelerate business development; board work is being simplified and, in connection with this, we have thanked external board members in subsidiaries for their service.
 
Strong and motivated leaders and employees in subsidiaries are key to Seafire’s success. During the year, we have concluded and begun a number of successions. We are pleased to be able to attract strong new leaders. It is also pleasing to see broad participation in Seafire’s warrant program approved by the AGM - a fully subscribed program is testament of the belief among key personnel in the Group’s potential going forward.
 
Future prospects – further uncertainty alongside some optimism
The economic situation remains uncertain, with considerable turbulence in the global economy. Seafire is primarily exposed to the Swedish economy which has long been weak. We began the year with a hypothesis of a gradual strengthening of the economy, the timing of which has gradually been pushed forward. Whether a strong June is a sign of a turning point is as yet unclear, but we are seeing increasing activity levels among the customers of subsidiaries, which will hopefully translate into increased business volumes going forward. We continue to work actively to drive profitability and cash flow, and are continuing to work on potential additional acquisitions. The most important piece in the puzzle - great people - is in place and I look forward to an active fall with the team and its new members. I would like to thank all the Group's employees for their hard work so far this year, as well as the shareholders for your continued commitment to Seafire.
 
Daniel Repfennig
President and CEO