Green Landscaping Aktie

Welcome to the Green Landscaping Group Q2 Presentation 2026. [Operator Instructions]

Now I will hand the conference over to the speakers. Please begin your meeting.

Good morning, and welcome, everyone, to this conference call regarding Green Landscaping's report for the second quarter of 2026. My name is Tomas Bergstrom, and I am chairing the Green Board of Directors since May of this year. And around the microphone this morning is also Johan Nordstrom, Marcus Holmstrom and Clein Johansson Ullenvik.

I'd like to start by repeating yesterday's factual information when we announced that the Board and Johan have agreed that Johan will step down as CEO effective today. At the same time, we have agreed with Clein, who is a Director of the Board, to step in as acting CEO also effective today, while we initiate a recruitment process and search for a new long-term leader of the group.

While decisions and discussions like these are not easy, we are confident that we have an excellent interim solution in Clein and that the company will be in good hands with him, the rest of the management team, all the strong leaders in the group and also with active support from the Board. We will and have, in fact, already started to work as a team with a high degree of energy and determination. You can never be certain, but I do not believe this transition will slow down the continued development of the group.

It is important to say that we see no overall change to the strategy of being a home for entrepreneurs and of becoming a European champion when it comes to urban outdoor landscaping and maintenance in order to create greener, safer, climate-ready and nicer cities and villages where people want to live and work. With that said, we obviously have ideas on how we can develop and strengthen the group over time.

During the Q&A session, I'm happy to take any questions on the announced leadership change.

Before we go into the report, followed by a brief introduction by Clein and finally, the Q&A session, I would also, on behalf of the whole Board, like to thank Johan for his efforts and contributions to the group. During 11 years, he has been instrumental in building up the group of today, and he has navigated the company through both good and more challenging times. I am looking forward to another type of relationship with Johan as the third largest shareholder.

With that, I hand over to Johan and Marcus to go through the report, followed by an introduction by Clein and then a Q&A where we will jointly try to answer any questions you may have.

Johan, over to you.

So thank you, Tomas. And as always, let me put the financial report into a larger context to begin with. So for the last few years, we have actually faced, I would say, not significant, but we have faced market headwinds, particularly in Finland, Sweden and Norway. And as we know, our report in the second quarter of this year, we are, kind of, happy or pleased to see that we have returned to organic growth, and that is in comparison to last year, I think we were at minus 9%. And this year, we are reporting an overall organic growth of 6%. So that is on the positive side.

When we are in discussions with the local managing directors of the companies, where we see or what they are reporting is that they actually see fewer bidders in the processes when they are bidding for new contracts and also they are reporting stronger order books. So from that perspective, we can see that there is a slight relief in the market, but it's also too soon to say that it's an early sign of recovery, but it's too soon to say that we have reached a turning point. I think that's the main conclusion when we look upon. So the market is looking better, and we see early signs of recovery. And of course, the organic growth in the quarter is quite strong.

In terms of financial performance, the overall financial performance in Norway and Sweden are not up to our expectations. We have worked a long time on improving the situation in Sweden, in particular. We see that they are improving, but not really at the pace that we would hope for. Situation in Norway is slightly different. We had the market headwinds, and we had basically two companies where we communicated that we have difficulties with and one of them is actually improving in a quite significant way. So that's on the upside in Norway.

And then the other main part of this quarter report, I would say, that is the development of Other Europe that shows a continued strong performance. And also, I would like to highlight that we have the operation in Lithuania, which developed, and their performance is quite important to the company. They are having a high profit margin, and we have communicated that those contracts would be renegotiated during the second quarter of this year. And we're very happy to report that we have rewon the majority of all those contracts, and we have rewon them at the profit margin that is higher than we previously have communicated. So that's a very positive development in -- at the state of the company in Lithuania.

So let's move into the report. We have a short introduction to who we are, and that is basically that we are a Green Landscaping Group. We are operating in a very large and attractive market. The structure growth means that we are taking care of the urban environments in the cities. And then, of course, we have talked a lot about the strategy, how we work, what does it mean to be a decentralized company. That really means that we are operating in 6 countries with 60 entities and each one are led by their own local managing directors. And that means they are able to change with the market. They are close to the customers, and that has proven to be a very effective strategy, both when times are good or times are bad, that's effective one.

And also, of course, we are a serial acquirer as we are investing in other entities and have done so quite successfully over the last few years.

In terms of the long-term performance, so as I mentioned, the last few years, we have seen a negative organic growth, and we have had acquired growth. So that means that the total growth over the last 2 years has been kind of flat, even though we are seeing, as was mentioned, early signs of market recovery with a high performance in terms of revenue in the second quarter of this year.

Profit-wise, as we have held, I would say, kind of firm in terms of revenue, the price pressure, in particular in Norway and to a large extent also in Sweden has meant that we are filling up the order books, we are having to work, but we are doing that at significantly lower profit margins than we did before. I don't really see this as being a structural change as I heard about Norway, as the Norway market will recover, we do expect the companies in Norway to recover to previous or healthier profit margin than we see today. So it's not a structural change in the marketplace according to my opinion. So that's about that one.

And then to sum up the second quarter. As I did mention, we had an organic growth of a fairly high 6%, and we had a total growth of 15%. So that's a really strong number. And then, of course, profit-wise, we are at SEK 130 million, and that compared to a year ago, that's a decrease of 10%. But nonetheless, we see strong performance in Other Europe and yes -- and then, of course, if you look upon the cash flow, we had a very high focus for the last 5, 6 weeks on the cash flow generating as that has been weak for the last few quarters.

And I think we -- typically, the second quarter is a quarter where we tie up capital because we are starting up all the new projects. There is a high revenue. And typically, that means we have a negative cash flow. And this year, we were able to have a fairly good release and that means we had a minus SEK 7 million compared to minus SEK 78 million, comparable period last year. And then, of course, in terms of the leverage, we are 3.4x, and that's a fairly high number. We are really not happy with that one, and we are focusing on making sure that, that one will come down as we move into the following quarter.

I think that's -- next slide. And then if we look upon Sweden, as we have been communicating that we have for 1.5 years been focusing heavily on improving the financial performance in Sweden, meaning that we have divested or closed a couple of companies, and that means we have a decrease of 2% of revenue, while organic growth was actually 4%. So we see organic growth in the remaining entities while the divested or closed entities are contributing negatively.

And then, of course, we came in at an EBITA by SEK 26 million, that gives us a margin at 4%. So we are at the tail end, I would say, of what we refer to as a turnaround of Swedish entities. And those are, at large, progressing according to plan and will be finalized more or less during the third quarter this year.

Norway, as we can see for the second quarter, we are reporting an increase of 9% organically, and that's a very high number for us. So the market, again, it's early signs. We're not saying we're at the turning point, but they did really good work on keeping up their revenue. And then in terms of profitability, they achieved SEK 29 million and a margin of 4.1%, which, of course, was to some extent expected, but it was significantly lower than previous year. So what we have been reporting is that we have continued challenging market conditions, but we actually do see early signs of improvement.

And then Other Europe. And there, we have a very healthy increase of 55% (sic) [ 56% ]. So it's quickly growing, and that's where we have been spending time and effort in terms of the acquiring companies and adding those to the group. And we also saw a significant increase of EBITA to SEK 85 million, and that gave us a very healthy margin of close to 17% EBITA margin. And on the average, it's a strong performance across all the companies in that region.

And I did mention the, I would say, not extraordinary, but the very good achievement of Stebule, who rewon the contracts at very healthy profit margins.

So by that, I think I hand over to Marcus, our CFO.

Thank you, Johan. I will cover the main financials as usual. The second quarter showed strong net sales growth of 15%, totaling at SEK 1.8 billion, bringing our rolling 12 months sales to SEK 6.6 billion, a total growth of rolling 12 months now at 8%. As said, we are very pleased to see the organic growth in the quarter, 6%, positive for second consecutive quarter, and we have organic growth in all segments.

Reported EBITA amounted to SEK 130 million compared to SEK 145 million last year. The profitability in Sweden and Norway is at a low level, but the trend is moving in the right direction, and we're seeing that the actions implemented are yielding positively. However, the market headwind is negatively impacting. Segment Other Europe continues the positive development, and we see a good sign of positive development in all regions.

The EBITA margin in the quarter came in at 7%. For rolling 12 months, the EBITA margin is at 6.3%, and we're not satisfied with the overall outcome and are strongly focused to return to positive EBITA growth in Sweden and Norway. I will go through more details around cash flow in the next coming slides, but the cash flow from operating activities came in at minus SEK 7 million, which was an improvement compared to last year and financial leverage came in at 3.4x.

We are very pleased from a market perspective to see that the order backlog is increasing in the quarter to SEK 8.0 billion. However, it's important to know that we shouldn't use the order backlog as a short-term indicator. But in long term, it's very positive to see the growth. And as Johan mentioned, we are particularly pleased with the order intake in Lithuania in the quarter.

Earnings per share in Q2 came in at SEK 1.29, which was an increase compared to last year, which was largely driven by the reversal of -- revaluation of future earn-out liabilities of SEK 27 million reported in the financial net of our P&L. And this -- I also want to highlight in regards to that revaluation, the acquisitions continue to perform well in line with our investment case. However, with a short remaining part of the earn-out period, we no longer expect them to reach the maximum level of the earn-out conditions.

And looking at cash flow, second quarter is typically a quarter where we build working capital. And as we also deliver strong organic growth, we're extra pleased to see that the cash flow is improving in the quarter, having operating cash flow at minus SEK 7 million compared to minus SEK 77 million (sic) [ SEK 78 million ] last year. And the improvement reflects the strong focus we have had on working capital management and cash flow generation across the group for many quarters now, and it's a sign that our improvement measures are being -- are starting to yield results.

We have had continuous efforts focusing on improved timely invoicing, timely collections and improving our commercial conditions in the operational contracts. As a portfolio, we see improvement in large portion of our entities, and we're staying close to the ones that not yet achieved the progress as we have expected. And this effort will continue with high focus in the third quarter.

Looking at the cash flow bridge in the quarter. Cash flow from operating activities, as said, minus SEK 7 million, then we had total earn-out payments of minus SEK 20 million from financing -- from investment activities. We also had CapEx and other lease amortization totaling at minus SEK 83 million. We did not repurchase any shares in the quarter, totaling the total free cash flow at minus SEK 110 million in the quarter.

Having the negative total cash flow in the quarter, financial leverage came in at 3.4x, which is above our financial target. Our ambition is to return to target driven by improved operational cash flow and earnings. However, I would like to underline that we maintain headroom to meet our financial covenants in our funding agreements. And the key priority for us going forward is to improve our cash flow generation.

Looking at the loan maturity profile, we did a lot of actions in this area during last year. We secured and broadened our financing base with having refinancing our bank debt, which is financed through SEB, DNB and SEK. And we also last year issued our first bond. We have a well-balanced loan portfolio with additional options to extend the bank financing 1 plus 1 year in addition to the time frame we're seeing on the slide. And prior quarter end, we had cash and cash equivalent amounting to SEK 483 million and unutilized credit facilities amounting to SEK 342 million.

On our financial targets, we are closing into our growth target, rolling 12 months at 8% compared to the target of 10%. EBITA margin below at 6.3%, and we're putting significant effort and focus to improve the organic margin development in Sweden and Norway. Financial leverage at 3.4x, as said, it remains above target, and it's a key focus for us to strengthen our operational cash flow and prioritize to reduce our indebtedness.

And finally, we have also a fourth financial target in terms of dividend. And at the Annual General Meeting in May 2026, the shareholders decided that no dividend should be distributed for fiscal year 2025, which is in line with the decisions from previous years.

And with that said, I want to hand back to you, Johan.

Okay. Thank you very much. I really don't have much to add to it. But before we open up for the Q&A session, we hand over to Mr. Clein Johansson.

Hello, everybody. Clein Johansson Ullenvik here. I know some of you in this call, but just briefly, my background is ABB, 12 years, starting as a trainee, ending as the last 3 years of that period as Managing Director in the ABB Group. Then moving forward to Ahlsell for 7 years, 1 year, CEO, 5 years, roofing products and then 2013 up until a month ago, Swedol/Alligo, where I had the huge joy to be part of the team building Alligo in a public environment since 2020.

I love this type of business. My parents used to say that I sat in an excavator, not operating it. They say I operated it. I strongly do not believe that, but I sat in an excavator before I could walk. So I grew up in this type of business, and I really, really love it. And I will approach this period with great -- carefully and respectfully and to learn to know the team better.

So yes, that's me.

Thank you, Clein. So then we'll open up for Q&A. Please go ahead.

[Operator Instructions] The next question comes from Jonny Jin from SEB.

I hope you can hear me. I want to start with a question on organic growth and in relation to your profitability because I know that organic growth is positive, which is good, but it looks like incremental margin is still negative.

So can you maybe elaborate what sort of entities are actually growing and sort of give more elaboration on the growth? Is this sort of a mix effect? Or yes, how come the margin is continuing to go down as you go? That's my first question.

Well, it's Johan here. What we see, as is mentioned, is that there are fewer bidders in the marketplace, and there are actually more orders to bid on, and we have been able to build up the order books. I think that's a general trend we see in the marketplace. However, the price picture is still under pressure and has been for a while going back. So this is just a consequence of a market that has been shrinking for some time.

And then you have to make sure that you are competitive in the marketplace and in particular, in Norway and to, I would say, also a large extent in Sweden. That means that in this situation when you have an increased competition -- competitive situation and the market is shrinking, then you have to fight for the orders. So it doesn't mean that you have a bad company performance. It's only that you have to keep the engine running at the company level. And that's a situation we have had.

My personal thinking is really that as we are in a situation where the market has returned to positive growth, we see that there are fewer bidders, and we see from our companies internally within the group that the order books for the coming 6 months are healthier than they were a year ago. So my expectation is that we will see an increased profit margins at which you can win the contracts moving into the future. But that's not the point we are, but the point of time where we are right now is that the market seems to be recovering, but the prices have not yet recovered.

Okay. I understand. I understand. I just want to understand this a little bit better if there were any unusual mix effect as such because I know that the market is still tough and there is a price pressure as such, but I mean there's also an option to walk away from unprofitable business if it's too fierce price competition. So...

Yes. But we are not talking about unprofitable business. We are talking about where you have profit margins, you are still making money. So difference is if you can -- a quotation at 10% or 12% or 2%. And when you have competition, in particular in Norway, they have done -- I would say that the entrepreneurs in Norway have done a very great job on defending the market positions. We have to understand that we have had a record high level of bankruptcies in Norway, while we are keeping and standing our ground in a good way.

So they have done actually a good work, but they can't win at the previous profit levels they have had. But as the market is coming back into shape and becomes bigger, then, of course, our expectation is that they will start to increase the prices on the bidding process. And by that, the prices in the market at which you can win a new contract will increase as well. But we haven't seen that one happening yet.

Okay. I understand. Speaking of Norway then, I know that you said that in your previous calls that you had some internal execution challenges converting sales into profits and such. Can you maybe elaborate a little bit more there and update how this is progressing, would you say? Do you feel that you're happy with the internal organization you want now? Or are you still sort of working it out on internal execution side?

Yes, as we said, we have had two things going on in Norway. The one thing is the market situation where we have had a very challenging market situation. And also, we have had two companies we basically have communicated, where we say that these companies do have operational issues above and beyond what goes on in the marketplace. And we have to keep in mind that we have -- I think it's 12 companies in Norway, and we have really good companies in Norway to begin with. So from that perspective, Norway is and has been a very good market for us.

And then we did encounter two difficult -- two challenging situation in two of the companies. And we are kind of pleased to see that one of those companies are actually progressing above our expectation in terms of performance. So that's really good to see. Then it's sort of linear. It's not saying that they're going to have additional difficulties. But right now, they are actually improving above our expectations. So that's really good.

And that goes back to the report we made in the third quarter of 2025 when we actually communicated that we had to do some write-off. That company is performing above our expectations at this point of time, and that's really good.

And adding to that, Johan, if I may, also that we have now also completed the strengthening of the country platform in Norway in terms of leadership, where we have a new country manager and enforced the capabilities in terms of supporting our entities out there, which brings our -- and with a focus on strengthening governance and bringing our companies closer together. So that's also something that has progressed really well in the quarter.

Yes. Good point, Marcus.

Okay. Yes, that's good. Then in Sweden, I want to ask about the margin there as well. I know that the market is tough as such. But I mean, focusing on what you can control like on your internal side, I mean, margin is still down year-over-year here. And I know that you also shut down some unprofitable business. So can you maybe shed some more comments on why the margin is down? Or are you happy with this level, given the circumstances?

No, we are not happy with the performance, but we also have to keep in mind that we did a divestment of Jordelit in the beginning of this year. And the profile of the revenue of Jordelit is basically they are making money in the first half year and then they're actually losing money in the second half year. And that is impacting the numbers as you look upon them.

So adjusted for that one, we don't see any major difference compared to a year ago in the performance, and we are on track in terms of -- we started, I think it was more than 2 years ago in making, I would say, a significant effort and once and for all to improve the profitability in Sweden because we haven't been happy with that performance. We have had companies just making quite healthy margins, and then we have companies in Sweden who actually have been running losses.

And then we said, as I mentioned 2 years ago, that enough is enough, let's do something about it. And the decision to divest Jordelit was one part of that plan in order to improve the situation in Sweden and return to, I would say, a normalized or a decent profit margin because that's the end goal here. And the process or the progress, I would say, on that project is pretty much according to plan. We have closed down one company. We are in the process of shutting down another two companies, and that is progressing more or less according to plan.

And also, those are the companies who are actually tying up a bit of our working capital as well. And as we drive this project to its closure, we are also expecting a significant cash release as that is being ended, I would say, or when we have reached the goal of improving that situation in Sweden.

Okay. I just have one more in Sweden and Norway. I know that you said that, yes, you anticipate a gradual recovery from here in the coming quarters and that you're happy with the intake here. So in your sort of orders, do you have any visibility of, sort of -- is it margin in the order book, is that shifting in any clear direction? Or is it more...

I think the point you're making is that you have an order book and you have won the contracts at lower margins than you would be expecting. We don't see the margins being worse than we have had for the last year, I would say. But the point is really that, yes, the market will recover. We see that the order books are at a healthy state, and that also means if we should fill up additional orders, then that should be at a higher profit margin. I think that's the discussions we are with the MDs at this point in time.

So in terms of seeing -- it won't be like you see a rapid improvement in profit margins. It will be a -- my opinion is that it will be a gradual improvement as we see the third and the fourth quarter coming into place.

Just another question in Other Europe here. I know that margin is good, as you said. I want to make clear, is there any boost in the quarter from some sort of finalization of projects impacting positively like timing-wise? Or I just want to understand how we should think about the Other Europe margin ahead as well, because...

No, we don't run that big a project. So we don't have any single one or two or three projects that would have that impact. We are running hundreds of thousands, I would say, projects in each one of the quarters. So if you just look upon the number of companies we have in that region and then any single companies are running 30, 40 projects simultaneously per month.

So no, we do not have that big projects that could have a negative or a positive effect that could impact even the segment. For a single company, yes. But even at segment level, that would be even out.

Okay. Yes, that's clear. Perfect. I just want to make clear there. Then on the retained -- maintained contracts in Lithuania, when is those new contract structure, when will that hit your numbers?

So they will start now in the third quarter. So that's the time frame, vast majority of it.

Okay. That's clear. Then a quick one on cash flow. I know that it improves year-over-year and there's some seasonality in this quarter. But I mean, given that you are coming from a sort of relatively higher working capital tie-up, going forward, do you expect sort of a deviation from regular seasonality so that the cash flow can be better than what it usually be going forward? Or how should we think about the working capital release? When can that happen, the big swing?

Good question, Jonny. And as I said, we're pleased to -- it's encouraging to see the development here in Q2, but we have still more to achieve. And in the total portfolio, we're seeing the shift that we are moving in the right direction, but we're still staying very close to the companies that haven't moved satisfactory to deliver the improvements we expect.

And we are -- from a cyclical perspective, we usually have a flat working capital development in Q3 and then positive cash flow in Q4, Q1. And we are, from a bigger perspective, expecting that also for this year, but seeing that we can reap benefits from delivering on the actions we have put in place and put in the expectation. So there are potential for us to deliver a bit stronger than usual seasonality here.

Okay. That's clear. Just one final from my side, and that's maybe to you, Tomas, representing the Board here maybe. What sort of profile are you looking for in your next permanent CEO? And what sort of key metrics or characteristics do you want to see in your next CEO?

Well, thank you, Jonny. I think that is to be discussed with the Board, and we haven't exactly put down the specification yet. But on my wish list, there are, of course, a few things. I need -- I think one thing is a strategic mind, experience from a similar business model. I think international experience is good. It needs to be a modern communicator and the person should have a track record of capital allocation and shareholder value focus. Those are a few things, but needs to be defined in more detail.

[Operator Instructions] The next question comes from Karl-Johan Bonnevier from DNB Carnegie.

So a lot of questions and a lot of answers already. So it's good to see that most of my things on the my list has gone by now. But just to go through more clarification, if possible. Looking at Sweden and Norway and when you say you are targeting a positive EBITA growth, I guess, comparisons with last year are maybe not easy, but at least going into the second half, less demanding than you had in the first half. Is that a good way of looking at it that you are probably turning the tide already going into the second half?

Yes, it's -- yes.

Yes, of course, we're driving the actions to deliver organic improvement here. And as you are on it, we have -- we are absorbing in our organic EBITA bigger write-downs, which Johan mentioned also in one of our Norwegian companies during last year. So that's for sure, not expected in this half of the financials.

But on top of that, the actions we're driving should also yield positively and it comes to also the discontinuance business we have in Sweden that was loss-making last year and so on. So yes, from that perspective, gradual improvement.

Yes. it's -- as Marcus said, we did encounter difficulties in the third quarter and fourth quarter last year. And that means that the comparable numbers are somewhat easier. So yes, our expectations are that we should perform above that level that we did last year.

Good to hear. And just on Lithuania and Other Europe, when you're looking at phasing in now the new contract portfolio, do you see that, say, the Finnish, German operation can balance that headwind when you're looking at it and maybe keep a growth coming out of also the profitability in Other Europe in these kind of circumstances?

Can you rephrase the question? So I clearly understand it.

Yes. No, looking at the headwind that is obviously now coming from Lithuania heading into new contract setup. If you take the view of Other Europe, do you see that Germany and Finland can balance that kind of headwind. So you still are staying in a positive momentum from an Other Europe perspective, so to say, even though Lithuania is going to be...

What headwind are you referring to?

Well, profitability, looking at the absolute EBITA as we talked about in the Nordic operation, yes.

Karl, is it referring to the margins in our defended contracts in Lithuania?

Yes. No, I'm trying to grasp the impact on, say, the total other European operation of that kind of conversion that you will have in profitability? Because I guess you are still seeing absolute profit growth coming out of the German operation given the acquisitions that are coming in still having a positive contribution. And if that is then on the similar magnitude as maybe the headwind we're going to see then from slower profitability coming out of the Lithuanian operations?

Sorry to say we haven't made that analysis. What we have been communicating is that the rewon contracts in Lithuania will have a profit margin, what do you say, significantly or yes, being at a large percentage above what we see in that region at this point of time.

So that's what we have been communicating, and that will give you some guidance in terms of what type of profit margins are we looking for in Lithuania. So when you refer to the headwind, we -- yes, of course, in absolute terms, that should mean to some extent that the profit margin in Lithuania will come down, but they will come down at a significantly higher level than compared to the company or to the segment Other Europe as it is. So those profit margins are quite high.

And the outcome for us here in the second quarter was positively in terms of the magnitude of what level these contracts were rewon at. But then on top of that, yes, we still have benefits from the completed acquisitions in Germany that will also drive an absolute EBITA growth in Other Europe.

Just trying to bridge the gap between the different components here so we get some sort of total kind of reasoning around it.

Yes.

[indiscernible] analysis. We just haven't done that analysis in terms of what -- I understand the question there. And that is that it will be a slightly lower contribution in Lithuania in absolute terms, but also you will probably see a slight growth in revenue in Lithuania as well because we have also -- it's -- let's come back to that question in the third quarter.

Sounds fair. Sounds fair. And Tomas, maybe turning to you and Clein a little. When you see the situation that we now ended up in, and I know there's a lot of actions going on across the company. How are you setting the agenda for yourself and Clein in this kind of transition period before you find a long-term solution?

Well, as I said in my introduction, I don't see this at all slowing down the development of the group. We have an excellent interim solution in Clein. There are a lot of efforts and actions ongoing, as Johan and Marcus has described. We have very strong leaders in the country platforms. So it will be business as usual, and Clein will come in, and we will have an active Board trying to lay a very good foundation for new long-term leader.

I think, as I said, the strategy overall, there's no change to that. I'm sure, Clein, after a few weeks on the job, will have some ideas. I do have some ideas, and we'll come back to those. There are many things to develop as always in any company, and it's a continuous evolution. And I think strengthening the size of the group and leveraging the competitiveness of being 60 companies in 6 countries, that's a key priority going forward.

Sounds very logical. And listening to your reasoning before, it sounds more that you are looking for a new external candidate for the position rather than an internal one.

We'll run an open process, external candidates and also internal if there are candidates. We'll do this thoroughly and in a good structured way. We will take our time, and whether it takes 3 months, 9 months or 12 months, we are confident that we have a good solution in place and that we will not lose any pace at all in developing the company.

Sounds very prudent. Thank you very much. Good luck out there, Johan, and I hope you are an active shareholder of the company going forward. And good to hear you on the call today, Clein, as I would have expected you to be in another call if you go back one quarter or so.

All the best out there.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you all for listening in the middle of July to this Q2 report and to the information also that we announced last night.

On a final note, I'd like again to extend a thank you to Johan for his 11 years with the company. I wish Clein good luck in his new position and looking forward to contribute and develop Green Landscaping Group going forward.

Thank you very much.

Thank you.

Welcome to the Green Landscaping Group Q1 Presentation 2026. [Operator Instructions]

Now, I will hand the conference over to the CEO, Johan Nordstrom; and CFO, Marcus Holmstrom. Please begin your meeting.

Thank you, and welcome to today's earnings call. As was mentioned, my name is Johan Nordstrom, and I'm also joined by our CFO, Marcus Holmstrom, who will manage the financial section of this presentation in a few minutes. But as always, let me tell you about the most recent performance and put that into context.

Now the first quarter of 2026 showed a strong organic growth of 11%, and we also saw an improved underlying EBITA compared to prior year with adjusted for capital gains, and we also had a stable cash flow in the quarter. Now if we adjusted for items for comparability, the EBITA amounted to SEK 27 million, and that is an increase of 29% compared to previous year.

Then the performance across the group is a little bit of a mixed bag. We saw in Sweden there we delivered clear earnings improvement, and that is driven by the actions we have implemented. Other Europe reported a seasonally stable profitability. And in Norway, we continue to see a weak performance in a challenging market. And of course, we are not satisfied with the overall outcome for the company, but we do remain fully focused on improving the profitability, in particular in Norway.

And also during the quarter, we have invested in one strong company through the acquisition of Finke Landschaft + Strabe in Germany. So I think that's the perspective that it is a mixed bag. So Sweden and Other Europe was performing, and we had some challenges in Norway, while we overall saw an organic growth of 11% in the first quarter.

So let's move into the presentation. Just a brief overview of the Green Landscaping Group. And we are a leading company in the ground maintenance and landscaping industry in Europe. We operate in a very large and attractive market with structural growth in the marketplace.

And also, we do have an entrepreneurial culture inside our company, and that is supported by a decentralized structure that works pretty well for us as we have local customers, and we're active locally close to the customers on the ground. And then to top it off, we do see a value creation through a proven M&A strategy that we chose to invest in the best companies in the industry.

So moving on to the long-term performance. I think it's wise to zoom out a little bit and look upon the performance of the company for the last few years. And we can clearly see that we have had a steady growth over time, while the year 2025 was, to some extent, a challenging year for us in terms of growth and also in terms of profitability. But given the first quarter where we are back to 11% growth, I think that's a pretty strong sign we are sending that we are back on track.

In terms of profitability, again 2025 was a challenging year for us. But right now, we have been focusing heavily for the last 1.5, 2 years on improving situation in Sweden. And we do see an improved performance in Sweden, and we do see a stable performance in the segment we call to as Europe, while we do have some challenging market conditions in Norway, and that's what we are focusing on going forward.

And next slide. So to sum up the first quarter, if we look upon the net sales, there we saw a total growth of 14%, amounting to close to SEK 1.4 billion. And also as I did mention, we have an organic growth of 11% in the quarter. Profitability-wise or EBITA, there we saw a decrease of 25%, where we land at SEK 30 million versus SEK 40 million a year ago. And as I did mention, we see a stable improvement of margins in Sweden and Other Europe, while we do have some challenges in Norway.

And also putting that in perspective, prior year's EBITA included a SEK 19 million capital gain on the property divestment we made in Lithuania. So really, when I'm comparing the underlying performance, I'm reducing the SEK 40 million by SEK 19 million, and that's where we see the improvement in the profitability.

Now cash flow was okay. We do have a heavy cash flow because we are not that -- we see some room for improvement in terms of cash flow. So the cash flow for the first quarter was stable, but slightly below our own expectations. And that also means that from the financial leverage perspective, we are at 3.1. That is from our perspective on the high side, and we will focus on that one going forward, so we can get it down to a more, from our perspective, acceptable level.

And then as I did mention, we are continuing our successful expansion in Germany, and we completed one investment in Finke in the beginning of the year. And then, of course, the last bullet there, the divestment of Svensk Jordelit. That's a part of the program we set out 1.5 years ago in order to improve the situation in Sweden.

Now Svensk Jordelit AB is a profitable company that we choose to divest because of the way the company has -- the way we have developed and the way the Jordelit have developed, we came to the conclusion that that company will probably be more successful outside the Green Landscaping Group. So that's why we choose to divest that company in the first quarter of this year.

Now looking into the Swedish market. Then we saw for the rolling 12 months, we see a decrease of 3% to SEK 2.5 billion where we have an organic growth of a negative 1%, while profitability-wise, we increased to 1% to SEK 115 million, and there we have a margin of 4.6%.

Now the first quarter performance, there we actually saw an increase of revenue of 5% to SEK 609 million. And also we saw an increase in EBITA of 9% to SEK 39 million. And that gives us a margin of 6.4% in the first quarter. I think we should keep in mind that the first quarter is typically a low season for what we are doing and having a 6.4% in the Swedish market from a historic perspective, that is actually quite a nice number.

And then moving on into Norway. And as we clearly can see there that the net sales have been decreasing by 6% to SEK 2.3 billion where organically we are a negative 5%. And then, of course, profitability-wise, we do see a significant decrease in profitability in Norway, which leaves us with a margin of 3.4%, and there the decrease is 60%. So we have an SEK 80 million EBITA margin in Norway, and that is clearly below our expectations.

And then for the first quarter, we actually saw an increase in revenue in Norway of 5%, while we saw a decrease on EBITA with a negative margin of 3.2%. So what's really going on in Norway is that we are having a difficult market situation, and we have 2 companies who are not performing, and we are working on improving the situation in Norway quite significantly.

And then looking upon Other Europe. So for the rolling 12 months, we can see that we have a net sales increase by close to 40%. And right now, that means they are up to SEK 1.5 billion. So it's becoming substantial to us. We have an organic growth of 2%. And then, of course, we saw an increase on EBITA by 26% to SEK 280 million, and that gives us with a very strong margin of 18.2% in the Other Europe segment.

Then for the first quarter, equal to Sweden and Norway, that's the low season we have in the first quarter. But still, we see a significant increase in net sales by 60% in the quarter, while we saw a decrease of profitability to SEK 15 million, and that gives us a margin of 4.9%.

And I think here, we should keep in mind that the prior year EBITA for the segment Other Europe included the sales of property capital gain of SEK 19 million. So one should bear that in mind when you compare the numbers. And then, of course, we completed, as I did say, one investment in the first quarter. So that's pretty much for the Other Europe segment.

And then just a short introduction to Finke that we closed in the beginning of the year. It's a company that was founded back in 2010. It's based in Borken in North Rhine-Westphalia in Germany. And they do provide classic groundwork, sewer construction and landscaping services to a broad array of customers. And size-wise, they are, I would say, a sweet spot company for us with about EUR 12 million in annual revenue. So we do welcome Finke into the group of companies we already have.

So by that, I think that concludes my part of it, and then I hand over to Marcus, who will walk you through the financials. So Marcus.

Perfect. Thank you, Johan, and I will cover the main financials. First quarter showed net sales growth of 14%, totaling at SEK 1.4 billion and bringing our rolling 12 months sales to SEK 6.4 billion. For the quarter, organic growth was, as Johan said, 11%. Structural effects contributed with 4% and the impact from exchange rates was negatively 2%.

As Johan also mentioned, all segments delivered organic growth in the quarter, largely driven by higher demand of winter services in Sweden and Norway, while colder weather had negative impact on demand for landscaping services. Also reflecting on structural growth in the quarter as we usually or for the first time, have divested company, and it's not a strategy shift we have, but looking at structural growth 4% putting it down to -- we had 7% contribution from acquired entities and the sales of Jordelit impacted negatively 3% in the quarter.

Reported EBITA was SEK 30 million, a decrease primarily due to the comparison period included a capital gain of SEK 19 million. But adjusting for this one, we had underlying organic improvement in our EBITDA numbers of 29%.

EBITDA margin came in at 2.2% and rolling 12 months, 6.8%. And we are, of course, not satisfied with this number, and we are strongly focused on executing on the actions we have implemented in Norway and continuing to deliver the positive trend we have in Sweden.

I will go into more details on cash flow in next slide, but operating activities amounted to positively SEK 137 million, broadly in line with last year and financial leverage sequentially increased to 3.1. And here, we're also heavily focused on delivering the cash home in order to be able to deleverage in the coming quarters.

The order backlog amounted to SEK 7.7 billion, which is higher than last year, and the increase is actually noted in all regions. But it's important to know that the order book fluctuates between quarters and should not be viewed as a short-term leading indicators.

Earnings per share in Q1 declined to minus SEK 0.36 compared to SEK 0.33 last year, mainly due to lower EBITDA in the period, while lower cost of funding had a positive effect.

Looking at cash flow. In line with seasonality, operating cash flow contributed heavily positively in the quarter at SEK 137 million. Following the negative development in 2025, we're not fully satisfied with this outcome and have a high focus on delivering reduced working -- delivering on our action to tie less working capital. Progress have been remained, but made in the forecast, but it remains a focus area for us.

Rolling 12 months cash flow from operating activities amounted to SEK 340 million. Looking at the cash flow bridge for total free cash flow in the quarter. Operating activities contributes with SEK 137 million. Then we completed the acquisition, totaling of cash consideration of SEK 112 million in the investment on Finke Landschaft + Strabe in Germany, which Johan also presented earlier. And then we also had a small portion of earn-out payment in the quarter included in that number.

We also divested Svensk Jordelit AB, which was divested and it had an annual revenue of SEK 117 million, and the divestment strengthens the group's focus on our core operation within maintenance and landscaping for public customers. That brought in plus SEK 37 million in our total cash flow.

So the net from acquisition and divestments was negatively SEK 75 million. Then we have the CapEx totaling including lease amortization at minus SEK 18 million, and we did not repurchase any shares in the period, totaling the free cash flow from the period at negative minus SEK 15 million. And as I mentioned earlier, working capital development and cash flow generation continue, as always, to be a focus area for us, and we're committed to deliver on our actions.

Financial leverage increased sequentially in light of our net debt being at SEK 2.5 billion and leverage at 3.1, which is above our financial target. And our ambition remains to return to the target driven by improved operational cash flow and, of course, improved earnings. However, I would like also to underline that we maintain good headroom to meet our financial covenants in the funding.

And our maturity profile for our financing, we did a lot of activities in this area during last year. We broadened our financing base with issuing a bond, and we also refinanced the bank debt to much more favorable terms and conditions compared to the previous ones, which helps us in lowering funding costs going forward. And we're very pleased with how we were received in the capital market of the bond issue, and it signals the strong confidence the credit market has in us.

Concluding my part of the presentation, looking at our financial target, leaving 2025 at negative growth numbers. We're pleased to see that we're turning a shift here and having rolling 12 months now plus 3%. And on the EBITDA margin side, very positive with the development we've seen over the past quarters in Sweden and the stability in earnings in Other Europe, and we're focused and committed to turn the trend in Norway. Rolling 12 months EBITDA margin ended up at 6.8%.

And finally, the leverage at 3.1%. We also have a fourth financial target, which is dividends. And in conjunction with the Q4 report, the Board proposes to the annual meeting that no dividend should be distributed for the fiscal year of 2025, which is in line with the recommendation and decisions from previous years. And our AGM will be held at 7th of May in next week.

And with that, I will hand back to you, Johan, for a few closing remarks before we open up for questions.

Yes. Thank you very much, Marcus. And as I said, it was a mixed bag in terms of the performance. So we are back on growth. That is very good to see. And in terms of the local markets, look upon the performance of Sweden, Finland, Lithuania, Germany, I'm quite happy with the performance and the activities we have done there.

We do have some challenges in Norway, and we are addressing those in a diligent way, I would say, where we actually have a new management, new country structure in place. So we have some new players there and made some significant changes to the structure in Norway and in order to improve going forward in the Norwegian market.

So by that, I think we open up for the Q&A.

[Operator Instructions] The next question comes from Jonny Jin from SEB.

I have a couple of questions. I think I will start with Norway profitability where EBITA is even more negative this year despite you have this record low snow level last year and organic growth is 7% this year. So elaborate even more what is really happening in Norway, what is driving this and how we should think about the Norwegian margin going forward ahead.

Yes. Thank you. Johan here. In terms of the revenue, it's quite simple because we had not a perfect winter, but we did have a decent winter this year. So we can't complain about that one. However, that means that it's one of the companies where it is one of the big players we have in Norway, taking care of the winter services in the Oslo region. So we did have the revenue, but they weren't able to turn that into profitability.

So that's kind of the simple answer on it. We had the revenue, we had the winter, but they were -- they failed in terms of making money out of that revenue that came. And that goes back to management change we had in that company. So we had fairly new management who were capable of turning the revenue into profit margins that we are expecting and should be expecting them to do.

But is it an execution problem down from your side? Or is it more of a market pricing pressure? Or what is your...

No, these are -- good question. Those are long-term contracts we have with the municipality of Oslo. So the prices are determined in the contract. So there's nothing wrong with the contract. So this is down to execution on how you execute on the contract per se and turn the revenue into profit. And that's where we failed.

Okay. Were there any extra costs in this quarter reflecting those restructuring or such charge in the quarter here?

Not really, no. So we had the revenue in Norway, but we weren't able to turn or this company specific because it's more or less one company we are referring to that typically should have had a good first quarter. And fortunately, they did not turn that revenue into profitability. And that affected the whole segment of Norway.

Okay. Okay. But looking forward then, I mean, on a rolling 12-month basis, you earn around 3.4% EBITA margin here in Norway. So my question is, where are you heading now? I mean, is it fair to assume that you could maybe reach a mid-single-digit EBITDA margin in Norway? And if so, how quick could this -- things you're implementing now, how fast can they take before they are showing in numbers?

The first quarter is always a bit tricky for us because to begin with, it's a low season. And in Norway, we do have some weak services. If you look upon Sweden, for instance -- and the profit margins we're having there, there we have been working actively in order to minimize the impact of the winter. And if you look upon last year, where we didn't have any great winter in Sweden, we were still able to -- I don't remember the numbers exactly. I think it was around 6% or something. And this year, we have like 6.4%. And that means we have been successful in minimizing the dependency on winter.

And of course, Norway is a different animal in terms of the winter services. But again, when the high season second quarter begins, then you have all the landscaping companies with different type of services we are providing. So I would be careful on comparing the first quarter activities to what we do for the remainder 3 quarters of the year because there you have different type of services done by the companies who have done winter services. And then, of course, all the landscaping companies who have a low season in Q1 are fully up and running in the following 3 quarters.

Yes. Okay. But I mean the actions you're implementing now...

It's hard to compare the activities we are doing in the low season in Norway versus what we are doing in the second, third and fourth quarter in Norway. It's a little bit like comparing apples and peers.

Yes, yes. Okay. I understand. But on a rolling basis, I think you should have all of those quarters in it. So I mean, 3.4% EBITA margin now, where are you heading? I mean, can we assume that these actions are implementing now and you are improving margin from Q2 onwards? Or where are you heading? Is a mid-single-digit margin fair to assume in Norway for the full year or...?

So, Jonny, looking at how those rolling 12 months leaving Q1 now basically is that we started to have challenges in Norway to a significant extent during Q3 last year when we had one company delivering project write-downs and so on. Then the market has also turned negative during that time. On the rolling 12 months, we still have quite tough comparables looking at Q2 last year. But then, of course, we are committed to bottom out in the next few quarters and delivering the result of the actions we're actually driving out in the business. Then we don't guide for the future. So it's up to...

No. And it's kind of tough to answer the question as we typically don't guide into the future.

Okay. Yes, we'll see. Then on the cash flow a -- moving on to cash flow here. While free cash flow is positive in the quarter, I think working capital tie-up is still negative on a rolling basis. I think it's negative SEK 170 million on a rolling 12-month basis here. So how should we think about this going forward? Can we expect a further working capital release ahead in the coming quarters? Or what is fair?

Yes. So we have a clear seasonal pattern in our working capital buildup and going into the high season, then we traditionally tie more capital. But what we faced during the last couple of quarters, we haven't released the amount of working capital that the business should have delivered. And therefore, we addressed it with actions and are expecting us to have a catch-up effect during this year in light of the actions we have done.

Looking at our portfolio, we have in total 60 companies and many of these are delivering solid cash flow. Then in a few entities, not in a specific area, we are addressing those specifically and making sure that the cash flow comes. So it is down to traditional housekeeping on a company level, and that's where we are addressing it currently together with the local MDs. So for the full year, we're driving action in order to release working capital on a rolling 12-month basis.

Okay. Good. Just a follow-up quickly to understand the cash flow better because it looks like -- on a rolling 12-month basis, it looks like that the change in receivables is the main drag explaining most of the drag in working capital. So can you maybe elaborate what is driving that and the dynamics going forward?

Yes. So we don't see that it should be represented that there's a shift in our model or market. But of course, the tough market itself contributes that it takes a bit longer to get paid than in a good market condition. But from a structural point of view, we are on top of those companies, and we see a bit of a timing effect during quarters, but the actions we're now putting in place is to reduce those type of timing differences also going forward. So yes, that's my short answer.

Okay. Just a final one from my side, and that's on the outlook. Could you maybe say something about how we should think about the outlook here in Norway and Sweden? And also, can you say something about how April has started for you?

That's a tough question as we don't typically give a detailed forecast. But as I did mention, I'm -- given that we talked about the performance we have done or the improvements we've done in Sweden over the last -- it's almost 2 years now, we have been working in improving the profit margins in Sweden. So we are at a positive trend there. I don't have any further information, so to say that we are -- that that trend will continue. That's my expectations given what we have done during the course of 2026.

Finland were down, I think, it was 2 years ago. We have made a significant improvement in profit margins in Finland over the last 24 months. I do expect that one to remain solid. Then you look upon Germany, for instance. I think there on that level, there's a couple of companies -- performing a couple of companies we are dealing with. But overall, the performance in Germany is kind of solid as well and becoming a very important market to us.

And then we are back to Norway with the discussions we have had there that now we are going into the landscaping services and the high season in Norway. And as I did mention, we have had several actions in place in Norway in order to improve that situation. So when that would take into effect, I think that's a bit too early to say, but we are working diligently, as I said, on improving the situation in Norway. And from my perspective, I think we are doing the right things in Norway. And eventually, we're going to see the improvement in Norway. But I can't guide actually at what pace and with what magnitude those improves will come. But of course, we are at likely 4% EBITDA margin in Norway, and that is significantly below our expectations for the Norwegian market.

The next question comes from Thomas Blikstad from Pareto Securities.

Sorry to be asking about this again. But to clarify on Norway, you say that there are no contract-specific pricing issues and it's just on the execution. Could you please elaborate sort of what kind of execution challenges it is then and what sort of immediate action you have taken to improve this considering the average snow level, average activity levels and so forth and 7% organic growth?

Okay. As I did mention, overall in Norway, there is -- first of all, the market is -- it's a tough market at this point in time in Norway. They do have a high interest rate. They have fairly high cost increases or inflation, if you like. And that, of course, affects the situation why the supply for new work, so to say, is actually down. So that means it's a heavy competition going on in Norway. So that's kind of the basic we have in the Norwegian market.

And then we have 2 companies who are clearly not performing. So we do have the volume or the revenue to work with, but they are not able to turn that into profitability. And those are basically 2 company-specific situations, if you like, while we do have a good number of really good companies in Norway. So I do expect Norway to start to perform wide the 2 other companies I'm referring to. There, we do have a new management in place, and we are working with those companies in order to improve the performance.

So it's not -- so to the best of our understanding, when we look upon the contracts per se, we are not sitting with long-term contracts who are unprofitable. It's much more on the execution. So it's the same contract as we had before where we were capable to making money under the old management. And then while we have the new management, we are not making money under the same contracts.

Okay. Do you have any sort of sense on the execution timeline of when you can sort of see a lift up due to initiatives taken by the new management?

I think that's a very hard question to answer. But that also goes back to the discussion I had that in the Q1, we have winters specific services, and that's one type of services we are providing, and that's where they fell short, while now we're going into the high season and you have all the companies in Norway who would contribute to the performance of Norway. So those companies typically have a low season in the first quarter anyway. So in terms of the mix, if you like, means that now we're going into landscaping and then we should be expecting a more solid performance from our Norwegian colleagues.

Okay. Okay. I understand. And just lastly, fuel costs. Was there any impact from this in this quarter, the lag between price clauses or similar?

No. Largely, we get the cost over to customers. But of course, we, as everyone, are impacted by increased costs in short term. But since our project business is so short in time -- in terms of the average project is 3 months -- we managed to compensate that in the new projects that we are now winning for the next coming quarters. So short term, yes, but we don't see a significant and the explanation from the Q1 numbers from there.

Not like we had 1 or 2 years ago when we had a very sharp increase in the inflation. That's not the situation and we do have indexation in most of our contracts in Norway. And as Marcus said, we have a churn or a turnover of the project-based business. So no, we do not consider us being locked down into unprofitable contracts. That's not the case we are looking at in Norway.

[Operator Instructions] The next question comes from [ Karl-Johan Bonnevier ] from DNB Carnegie.

Some follow-up from me as well, please, if possible. First, looking at snow removal in the quarter, how much of the 13% organic growth would you say was applicable to that normalizing, say, in the way talking and thinking about it as being an easy year-on-year comparison?

I think that's really a tough question because what happened this year -- and I'm not making any excuses here. This is just a fact, and that is we had good snowfalls in the month of January. And then we had a very cold season in February and onwards. So we did have snow in January and then it was cold. And when we are looking upon the specific companies, how they performed. We can clearly see that the landscaping companies were suffering, and that's pretty much by design. While the service company who does have snow removal, they had a good January, not so good February. So that's kind of the situation.

And going deeper into that analysis, we still have to dig into the data, but it's hard to make those how much the contribution was. But clearly, there was a contribution from the [indiscernible] if you compare to 2025 numbers where we basically didn't have any snow at all. So of course, we had an impact on the snow in the first quarter of 2026. But to what extent the organic growth was contributing to that one, unfortunately it's hard to say.

Fully appreciate the challenges of Q1 when it comes to it. And looking at the order backlog, I know you don't want to have it as a predictor of the future, but I saw a nice move both Q-on-Q and year-on-year. And I know one of the things, particularly for the Swedish operation, was to improve and strengthen the order backlog or the type that you had in the order backlog. Could you give some sort of indication what is driving it for the moment and where the components come from?

On overall, you're absolutely right, one should be careful because if you win one new big contract, then that will have a very big impact on the order book. But we have done an analysis on the order book per company level. And on the average, we are I won't say happy, but we -- typically, a company should have a minimum of 3 months. And then if they have a longer order book than 9 months, then they're probably filling it up too much. So when we did the analysis based on a company level from the order book, and this includes Norway, then we were actually not seeing any alarming numbers. So for the horizon, we can foresee that is 6 to 9 months from today, the order book is in a good condition on a company-specific level.

Sorry, my line is pretty poor here. So you're breaking up a little, but I'll look into the transcript on that. Continuing on the questions and looking at Sweden, obviously, you have talked about phasing out some operation that hasn't really delivered historically and still seeing this kind of nice organic move in the Swedish operation in this quarter. Is that a sign of strength in the remaining operation? Or is there something -- is it also say, more of a normalizing effect that is happening there?

When it comes to Sweden, this dismantle of still impact us negatively on a top line perspective, but it improves our profitability. So there, it's moving according to plan. Then, of course, when we refer to the top line, as Johan said, also on the organic growth in Sweden, then obviously the winter services year-over-year has an impact, and it's tough to break it down. But yes, the improvement actions are negatively impacting growth, but positively impacting profits.

Just to be clear that Sweden is a kind of -- I want to a special situation, but we -- the company was founded a long time ago in Sweden, and we had a total different strategy from the beginning, and then we have incorporated a lot of stuff during the last 10 years in Sweden. And that means it's a kind of special situation. We don't foresee us closing or shutting down businesses on like a normal going concept for us. It's something we did in Sweden in order because we were not happy with the performance in Sweden and then we basically said that, okay, we have to do something. I won't say dramatically, but we have to do something in Sweden to achieve a higher profit margin.

And that was a starting point for the program we launched almost 2 years ago, and that included the dismantling of 3 companies and the divestment of one company. And we are getting towards the end of that program. And then, of course, we are looking upon improving the remaining companies, and they are improving in a very nice way. So I'm kind of positive to the developments we have in Sweden. I don't see us shutting down companies left or right. That's not part of our strategy. That's what we did in Sweden in order to -- but they do have another historical background. So we need to keep that in mind.

And then we are improving performance in Sweden. I'm kind of happy with that one. And now as I said, we are working heavily on improving the situation in Norway. So we are going forward, then, of course, we will see a return to higher profit margins in both Sweden and in Norway.

One final for me. Looking at the acquisition pipeline, is it still promising, a lot of potential transactions out there? Or during this period where you have been a little more, say, reluctant on closing transactions. Have you missed anything to any competition that has bridged the gap, so to say, and missed them from you?

Not really, no. I think we are working closely, and I'm spending quite a bit on the M&A activities as well. So I'm deeply involved in that one. So I think we have a solid pipeline in terms of companies. I don't see us missing any companies that we would like to have invested in to any competitors or such. So I think it's moving along in the way we want. So of course, we are looking upon our -- gearing our debt level and the financial performance of the company and at what pace we can acquire companies.

And of course, given that we are at 3.1%, then we have to be prudent in terms of what we are doing in terms of investing in companies. So you have to watch what's going on there in order to not make any bad decisions. So the pipeline from that perspective, we are in dialogue with great companies and the pipeline looks as it's supposed to be, it looks okay from that perspective. And then we have to manage the cash flow and the profitability and the debt level, making sure that we can carry on in -- with what we are doing. And the goal for --

It's very logical and very wise.

Yes. So the goal, as we have communicated, that's to acquire SEK 80 million to SEK 100 million EBITA. And then we also have to look upon the SEK 3.1 billion. Of course, that's an analysis we have to do what type of free cash flow we have available for acquisitions for the remainder of the year.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. Thank you very much. And thank you for listening into this Q1 report for 2026. And as I said, we are happy to be back on track in terms of organic growth. The underlying performance -- EBITDA performance of the company is actually improving. We do have some challenges in Norway. So that's pretty much where we are. So by that, I thank you for listening in.

Thank you for listening in. Take care.

Welcome to the Green Landscaping Group Q4 Presentation 2025 [Operator Instructions] Now I will hand the conference over to the CEO, Johan Nordstrom; and CFO, Marcus Holmstrom. Please begin your meeting.

Thank you, and welcome to today's earnings call. As mentioned, my name is Johan Nordstrom. I'm the CEO of Green Landscaping, and I'm joined today, as always, by our CFO, Marcus Holmstrom, who will manage the financial section of the presentation in a few minutes. But as always, let me tell you about our most recent performance and put that into perspective.

We closed the year with an EBITA margin of 8.1% in the fourth quarter, and that represents a 7.1% EBITA percentage for the full year. And in particular, this was following a weak first quarter, and then we have had market headwinds for the duration of the year, in particular in Norway. And the Q4 highlighted a mixed performance across our segments. So if we look upon Sweden, that showed an improvement year-over-year.

And we have had a quite significant amount of work in terms of increasing the profitability that now is, I would say, turning a corner in Sweden. And there, we are really looking forward to what's going to happen this year. Norway remained a challenging situation. So it started by a weak market condition, and then it continued with market headwinds. And on top of it, we had, let's say, challenges in one of our companies in Norway at the same -- for this year.

And then at the same time, if we look upon Other Europe, and that is basically Finland, Lithuania, Germany and Switzerland, they are still delivering -- still they are actually delivering at a very high performance. I'm really impressed on what's going on there. And also, we do welcome the new companies who are contributing to the performance in that particular segment.

So during the year, we also made good progress on our growth agenda. And we, in the fourth quarter, reached our full year acquisition target, meaning investing in businesses corresponding to roughly SEK 80 million in EBITA. So in total, we completed 4 acquisitions during the year, 3 in Germany and 1 in Lithuania and all with margins above the group average. So I think that's the highlight and the background.

And moving into the presentation for the fourth quarter, just one page on who we are and what we're doing. So we are the leading landscaping company in Europe, and we do ground maintenance and landscaping business. So a large -- we are active in a very large market. The advantage of being in the large market is really about you can select the customers, you can select the type of services and also we have the possibility to select the different geographies.

And we also have structural growth into the market because we have urbanization and we have environmental that really supports what we are doing. So being in a growth market that is very large is clearly advantageous to us. Now given the type of work we are doing and the geographies, we have chosen to be a decentralized structure. Being local enables us to be close to the customer. We are quite agile in what we are doing, and it also means that we can have above industrial profitability as well.

So we have developed a decentralized model over the years, and it serves us very well at this point of time. And then, of course, being a serial acquirer, we have an element of M&A activities where we invest in great companies, making the group better and also increasing the shareholder value. So that's a short introduction on the group.

Now looking for the financial performance and to summarize the year 2025, we saw a decrease in net sales by 2% organically, and that's reflecting the headwinds we had in the market was a negative 8%. And then we were quite happy to add another 8% in terms of net sales from investing activities. The EBITA suffered by 16%, and that means that we delivered SEK 444 million in EBITA. And the full year EBITA margin shrank from 8.3% down to 7.1%. And the cash flow from operating activities came in at SEK 314 million.

And then from the investing activities or M&A, we completed 4 companies, and that corresponds to in line with target of 80% acquired EBITA for the full year. Now looking upon the fourth quarter more specifically, we can see that net sales increased by 1% and organically, we were a negative 5%. So the trend is slightly shifting here, and that is on the upside. And then, of course, the EBITA decreased by 11% to SEK 145 million in the quarter, and that amounts to a healthy margin of 8.1%, even though we delivered 9.3% in the previous year. There is a difference on the profitability in the different quarters for the year.

And the fourth quarter is typically among one of the strongest quarters we have and 8.1% is a good margin, even though it doesn't fully reach the previous year, 9.3%. And then cash flow from operating activities came in at SEK 206 million. That is slightly weaker than expected, and that means that our financial leverage are 3.0. And I know that Marcus is going to develop on that topic further on as it came in slightly below expectations.

And then, of course, from the M&A activities, we completed 2 investments in the fourth quarter. Now looking upon the long-term performance of the company. We have been on a constant growth for a fairly long time, where 2005 is actually flat. So that's -- I won't say it's a trend -- a breach of trend, but it's moving sideways in tough market headwinds, and we expect that to pick up again as we move into this year. Profit-wise, it's the same story that we're actually weaker in 2025, given the market situation, but also the activity levels inside the companies have been quite high. So we do have higher expectations as we move into 2026.

Now Sweden. We have been talking a lot about Sweden and all the activities we are doing there, and we launched a fairly comprehensive program moving into 2025 with the closure of companies and basically cleaning up that one, and that has been, let's say, developed during the course of the year. So that program is almost done. So I'm happy to report on that one. And that means that net sales decreased by 10%, and that's a combination of market activities as well as the closing down of nonprofitable companies.

And then we saw that EBITA decreased by 18% to SEK 112 million with a 4.5% EBITA margin. And again, it was the Q1 that was really the weak part of it, and we do expect Sweden to pick up, as I mentioned. For the fourth quarter, we see an unchanged sales of SEK 670 million, and we see a slight increase -- slight -- coming from low numbers, but increased by 34% to SEK 28 million, giving us a 4.2% EBITA margin in the fourth quarter. And as I mentioned, we are having had a lot of activities going on in Sweden, and we are basically looking upon that the trend curve will change as we move into this year for the region Sweden.

Norway, for the full year in Norway, net sales decreased by 10%. And organically, we saw a negative 9%, while we made one acquisition in Norway contributing with 3%. We see a significant decrease in profitability by 66% to SEK 87 million for the full year and a rather weak margin of 3.7% versus 9.9%. And there are a couple of factors going on in Norway. So we started out the year with basically no winter activities, and we have a fairly high winter dependencies in Norway. So that means we had a weak first quarter. And then we had the market conditions that was for the full year.

And then on top of it, we had project write-downs in one company that affected us in the third and the fourth quarter. So I think that's the backdrop on what's going on in Norway. And the fourth quarter performance, here we saw that the sales decreased by 16% to SEK 649 million, and we saw a significant decrease in EBITA of close to 70%, meaning that they delivered SEK 27 million in that particular quarter.

And moving on into Other Europe. So for the full year in Other Europe, and this is really where we have our growth focus, we can see that the net sales increased by close to 40% to SEK 1.4 billion. Organically, we were flat for the duration of the year and acquisitions contributed by 43%. And also that we had an even higher increase in EBITA, close to 50% for the full year to SEK 287 million with a healthy profit margin of 20%. And the fourth quarter, we see that we had a net sales increase of 42% and the EBITA increased to SEK 104 million, giving us a 22% margin, which is basically all-time high, a very strong performance in the companies we have. And that's all over the board. It's Finland, Lithuania as well as Germany and Switzerland, who are contributing to a very strong performance.

And then, of course, we completed 2 investments by the end of Q4 2025. And moving on to the companies that have joined us. We have Marco Schulz Forst-& Landschaftsbau. It's a company who was founded by Marco Schulz himself back in 1995. They operate in the area between Hamburg, Hanover and Berlin. So it's a rural area. They do offer a wide variety of services and among them, landscaping, run maintenance as well as forestry and woodworking. So it's a very nice company that we do welcome into the group.

They have a sales of approximately EUR 9 million with 60 employees. So it's a sweet spot company that fits very nicely into the group. And then we have one company in Lithuania was UAB Economus. They were founded back in 2006. They operate in Vilnius, but they also do work all over Lithuania. It's mostly public customers and what they do is basically children playgrounds and outdoor gyms and installations and services of those.

It's not that a big of a company, it's EUR 3.4 million, but we have to keep in mind that their wages and cost of labor and so forth are significantly lower in Lithuania compared to Europe. So in order to generate the EUR 3.4 million, they actually have a fairly decent operation in Lithuania. And we're really looking forward to working with this company going forward.

And that -- and this also supports our ambition to build clusters of companies. So now we have the second company in Lithuania. And we find it advantageous when we have companies close to each other, so we actually can get the communication flow and best learning best practices flowing between the companies. So we do welcome Economus to be part of the Green Landscaping Group. So I think that is my part of it, and then I hand over the financial slides to Marcus. So Marcus, please go ahead.

Great. Thank you, Johan. And I will, as usual, cover the main financials. Q4 showed net sales of SEK 1.8 billion, concluding our full year at SEK 6.2 billion, which reflects a total negative growth of 2%. Organically, that shows minus 8%. Meanwhile, we added acquisition of 8%. Adding on to what Johan earlier said just in terms of the organic growth development, we have, during the year, discontinued underperforming units in Sweden, which impacted the organic growth development on group level corresponding to 2%.

So -- but these measures will strengthen profitability and cash flow in 2026. Looking at EBITA in the fourth quarter, SEK 145 million, lower than last year. And as Johan just disclosed, a mixed performance between the segments. Our EBITA margin at rolling 12 months for the full year consequently at 7.1%, which is lower than our financial target, but still a testament of margin resilience in a tough market condition.

I will cover cash flow in more detail in the upcoming slides, but the cash flow from operating activities amounted to SEK 206 million compared to SEK 282 million last year. And as we were a bit weaker on cash flow, financial leverage in the quarter was sequentially flat compared to Q3 at 3.0. Order backlog amounted to SEK 6.9 billion, which is lower than last year, and we see the continued decline in backlog for Norway, but to a lesser extent in Sweden and stable in Other Europe.

But it's important to note that the order backlog tends to fluctuate between quarters. So don't see it as a short-term indicator. And when it comes to earnings per share in Q4, it declined 18% to SEK 0.89, which was a result of the lower profits generated in the period. But moving on to cash flow. In line with seasonality, our cash flow from operating activities contributed clearly positive in the fourth quarter, amounting to SEK 206 million.

It was slightly weaker than expected as we usually -- as we did not fully realize the working capital built during the high season, this is something that we are focusing significantly on and turning -- which is turning to actions. Q4 is our strongest cash flow quarter, but followed by Q1, which is typically also strong, and we expect the same seasonal pattern to continue this year.

Working capital development and cash flow generation continue, as always, to be a focus area for us. And total cash flow bridge in the quarter, as said, operating activities amounted to SEK 206 million. Then we completed the acquisition, which Johan presented, totaling a total cash consideration of minus SEK 123 million in the quarter. Then we had CapEx and other lease amortization totaling to minus SEK 83 million. And the net difference between new loans and repaid debt was positively SEK 115 million in the quarter.

Then in November, we also launched a share buyback program for 250,000 shares, which was activated and completed during the period, and it will be used to finance future acquisitions. And that altogether concludes overall cash flow of SEK 104 million in the period. As I mentioned, financial leverage was sequentially flat compared to Q3, which is higher than our financial target and our long-term ambition is to return to the target.

However, I want to underline that we have maintained good headroom to meet our financial covenant in our financial agreements. And looking at our maturity profile for our interest-bearing debt. In October, we successfully renewed our bank loans in line with our plan for the year as they were maturing in 2026. Together with the bond issued during the second quarter, we now have secured and broadened our finance base for the upcoming years.

And we -- the new loan terms are more favorable than the previous one and will reduce our interest cost from -- in Q4 and going forward. And we believe this is strengthening our financial position, but also sends a clear message that the credit market has a strong confidence in us. And then concluding the year with our financial targets, and we've gone through them in the presentation, but we have a growth target of 10%. We managed to deliver 8% in acquired growth during the year.

However, it was impacted by -- the total growth was impacted by the negative organic development we had in Sweden and Norway, partly due to the tough market, but also the mild winter we had in the beginning of the year. Then on EBITA level, as I said, we have a target of 8%, and we will conclude the full year at 7.1%, which we're not happy to be below target, but we still believe in light of the market we have faced during the year that it is a testament of margin resilience in the market condition we have operated in.

Financial leverage, 3.0. We have a focus on getting deleverage during this year that we're going into. And the fourth financial target is on dividend. And as communicated in the Board in the interim report for Q4, the Board proposes that the AGM do not pay any dividend for fiscal year 2025, which is in line with what decision -- in line with previous decisions. And with that, I will hand back to you, Johan, for some closing remarks before we open up for questions.

And it's really about 2 items here. That is the cash flow generation and what's going on in Norway, I think. But for the other sections or regions, the company is actually performing. So I'm happy to see where we are in Sweden, even though the numbers doesn't really support it at this point of time, but knowing the activities we have done.

And looking into the future, I'm quite confident in Sweden. We are having a lot of activities going on in Norway as well, but the market conditions in Norway is still challenging, I would say, even though we expect improvements in Norway going into the future. And then, of course, Other Europe, Finland has done a great work with Tapio and his team over there.

Lithuania is a strong performance and Germany and Switzerland is also performing. So even though 2025 turned out to be a challenging year, all in all, as you said, Marcus, I think it shows resilience what we are doing here, and I'm really looking forward to moving into the future and to some extent, leaving 2025 behind. It was a tough year. But nonetheless, that's where we are. So let's open up for questions in that case.

[Operator Instructions] The next question comes from Jonny Jin from SEB.

A couple of questions from my side. I will start with Norway, I think. Profitability in Norway seems very weak and the margin is down some 740 bps year-over-year. So maybe could you elaborate more closer what is really happening in Norway? And also, do you see any signs of improvement at all going into 2026? Or are these the levels we should expect to be representable for 2026 as well in Norway?

Yes. Johan here. Thank you for the questions. And I totally agree with you, we are not happy with the performance in Norway. But we have to keep in mind that given the type of companies we have in Norway, we have actually a couple of road companies who typically over deliver when you have decent winter conditions in the fourth and in the first quarter.

And those companies are selected by design because typically, the landscaping companies do not have that active season, in particular in the first quarter. So when we do not have any winter activities in the first quarter, which we didn't have in 2025, Norway is particularly hard affected by the winter activities. They really don't have the same possibility as the other companies have in terms of getting other things done when they don't have the winter activities. So it's by design.

And when we don't have winter, then they are negatively impacted by that situation. And that is what happened in the first quarter as they are road maintenance companies. However, profit-wise, when I look upon the activities we are doing, we are doing quite a lot of activities in Norway in order to improve the situations that should be visible going into the future. And we do not -- I do not, on this point of time, actually see any major signs of market improvement, but that doesn't mean that we expect Norway to continue at this level. So we do have actions in place.

We have done a lot of activities in Norway and strengthened the organizations. We have a couple of new MDs. And we have also cost reduction programs in order to rightsize the companies given the market situation. So we are not waiting to see that the market should recover. We have taken quite a number of active steps in Norway in order to improve the profitability, and we expect that to be shown during the course of 2026. So we do not expect Norway to remain at these levels. And the base quality of the companies we have in Norway are actually quite good companies with very good entrepreneurs. So I think we will see a different performance in Norway going forward.

Yes, I understand that. But if we stick to Q4, I understand Q1 had this snow season effect affecting the full year. But in Q4 specifically, I talk year-over-year in Q4, then if I remember correctly, there were no super snow in Q4 last year. And I want to understand the -- it's a quite huge drop in the margin year-over-year.

So I would like to understand what is -- what's driving that? And can you -- and if I understand correctly, you expect a better margin next year regardless of market improvement. But can you elaborate there? Is it low-hanging fruit? Or can you shut down any unprofitable business? Or what are you trying to do there?

No, we have 3 items or I should say, causes affecting the fourth quarter. It's the market condition in Norway because it is a tough marketplace and the companies in Norway have been good in terms of keeping the revenue at decent levels, but they are doing that at the price of profit margins on the project they are executing.

So they're actually doing work and they have good customers in that. And so from that perspective, it's actually I can't say it's okay, but they are keeping themselves busy. They have order books. They are doing work. They're keeping the revenue in place. But the market is very competitive in Norway at this point in time, meaning that the prices are very low. And the companies know what's going on, and they are winning contracts, but they do that at a lower profit margins given the market situation. So it's pure market.

It's -- we have one company in Norway who we are talking about where we have project write-downs. But besides that, the companies in Norway are quite healthy and doing good work. And I think that's a major driver to the low profitability in the fourth quarter. And then, of course, I can always say it was a winter effect again.

But yes, it wasn't really that good win in the fourth quarter in Norway either. So we didn't have any contribution from the winter services in Norway as well. That is typically a higher profit margin business when it comes -- so when it's slowing in Norway, we have a couple of companies who benefit from that situation. But the base reason, I would say that is a market condition. It's a very competitive environment in Norway at this point in time.

Yes. Okay. We'll see. I will come back to the winter a little bit. But before I do that, I want to ask something about the cash flow. And you said that you're not happy with the cash flow and cash flow seems weak here in Q4 given that you have not released the good cash flow year-to-date. So I mean, despite the small working capital release in the quarter, you tied up working capital despite this negative organic growth, and I'm just trying to understand this better. So I mean what sort of cash flow improvement are you trying to do going forward? And are you expecting to have a good release in working capital in Q1?

Yes, Jonny, starting to answer the last question, yes, we are expecting a release of working capital in Q1 in line with seasonality and that's supported by the actions we are now implemented and have implemented during the year. And as I said, we've been focusing a lot on the release of working capital during the year, and we're not happy with the full outcome of Q4 even if it was positive.

And it comes down to traditional housekeeping out in our all subsidiaries where it comes to make sure that everything is invoiced on a timely basis and collected when overdue. And that is our prime focus securing that we get the cash on our bank accounts. Then on a larger -- then we implement additional measures. But for where we're standing currently, that's the main focus for us, bringing the cash on.

Okay. Yes, that's fair. But I mean, in the quarter here, I look at the cash flow and the change in current liability seems extraordinarily high in the quarter, and it's also quite high full year 2025. So what is driving that, would you say?

It's more of an accounting timing when we have a different -- when it comes to payment and receivables. So we don't see any extra order deviating from that, but it's more of a timing effect.

Okay. And then one final for me, coming to Q1 here and the snow weather. So how is the start of Q1, would you say, given the favorable weather? And in terms of profitability, I think, Johan, you said that there is better margin on snow. So should we expect Q1 margin to be in line with sort of a normal winter quarter? Or how should we put that in relation to the price pressure in general in Norway now?

Well, I think we are typically careful with forward-looking statements. But if you look upon the weather reports we have had in Sweden in particular, I would say, compared to last year, we are in a significantly better situation, even though we are only at the end of January. We have to keep in mind that the fourth quarter is another 2 months to go, which we do not know at this point in time. But I'm carefully positive on what's going on and having the situation we had in Q1.

I know it's a lot of weather discussions here. But it was a very abnormal or unusual situation we had that occurs every 5 to 10 years in Q1 2025. And for the month of January in 2026, we have a much more normal winter, I would say. Snowfall in Sweden has been frequent, but it depends on where do we have the contracts and what does the contract state that we're supposed to be doing. So it's a mixed picture. But of course, I'm significantly happier with the month of January 2026 compared to Q1 2025. It's a very big difference.

Yes. Yes, I understand. But the margin here, what sort of margin could we expect on the snow? Because, I mean, Norway, you said is very tough now, and you explained the weakness in 2025 due to weather in Norway in Q1. Now the weather is looking good in Q1 2026. So what sort of margin should we expect on that? Is it fair to look at historical patterns or does it deviate from that?

It's a very detailed question. But the snow contracts we have are typically part of framework agreements. So that's multiyear or long contracts you have. When we talk about the market conditions, it's either the project-based business that is suffering, and that's the majority of the business we have in Norway, except for the road maintenance companies. So yes, I would concur where you are leading to that I would expect the -- let's say, the service agreements we have with the framework agreements, they should not be that heavily impacted. Then we always have the additional work.

And when the customers are out of money, then, of course, you don't get that type of work. But within the fixed framework agreements or the fixed service agreements, that's where you have the snow. They fall into that category. So they should not be negatively impacted by the competitive environment as we are experiencing right now to the same magnitude as the other sector of the business. And I believe we have roughly, is it 65% of the revenue in Norway that goes within the maintenance contract or framework agreements. So it's a big part of the business...

The next question comes from Stefan Knutsson from Redeye.

First off, I'm curious about your European business and if you could elaborate on the factors that those operations maintain significantly higher profitability than in Sweden and Norway. And to what extent you can have best practices from Europe to be integrated in Sweden and Norway?

That's a good, very good question. I don't know in which we have to start with. But let's start with -- let's start with the first question in that order in that case. We have a few companies in -- within that group who are very profitable. So -- and when we invest in new companies, we have a baseline in profitability. We didn't have that when we started out in Sweden.

So that's another topic because Sweden is Green Landscaping Svensk Markservice. They have a totally different history. But the companies we are investing in, then, of course, we are choosing and are quite picky in what type of companies do we invite into the group, what type of customers do they have, what type of profitability, is it sustainable and so forth. And that means when we're laying the foundation, given the experience we have, we have the advantage of choosing really good entrepreneurs who is running really good companies and that is what's reflected in the profit margins.

And then on top of it, we have a couple of companies who are really overperforming. And that means that we are at a profit level in Europe of 20%. So that's the explanation behind that one. Sweden started out differently with the old Green Landscaping where we changed the strategy and then the acquisition of Svensk Markservice. In Norway, we actually had the same philosophy as we had with Other Europe at this point of time.

And that's why I'm quite confident that the quality we have on the companies in Norway are quite good, and it's actually a market situation that creates a situation in Norway. And that means we do not have that market situation, in particular, in Germany. It's a more stable environment. And as you have good companies in a stable environment, then you're actually able to have that type of profit margins.

In terms of best practice, we did -- I would say we have great companies in -- both in Sweden and Norway and in Germany as well. And yes, we are working actively within the different regions on spreading best practices because even if we have very good companies, there are always items that can be improved and building clusters where the companies are geography and also language-wise and so forth. That is really beneficial to the case.

And then we, as a group, are able to learn from all the companies we have within the group on how to improve the operation in each and one of the companies and build resilience and build quality companies. And that's really the aim of the whole configuration we are doing that we are able through implementing best practices, improve each and one of the companies within the group.

Very insightful. And then a second question, like what, in your opinion, what will be needed to improve the market conditions in Sweden and especially in Norway?

I would actually say that market conditions in Sweden are showing signs of recovery. So I'm not overly concerned about the market situation in Sweden. So independent, I would say, on market development. Now I'm obviously promising too much, but my expectations are that we will see that we have passed the turning point in Sweden, and I expect margins to improve in Sweden going forward.

I'm not saying that revenue should show a significant increase. But given the actions we have done, I do expect the profit margins in Region Sweden to improve in the coming years. Norway is a different situation with the market conditions. So there, I'm more careful. And I'm not, let's say, betting on that the market will change, and that means we have to change the companies and how we run the companies in order to improve the profit margins in those entities we have in Norway.

And as I said, even though the numbers are really bad for Norway. We do have good entrepreneurs. They are doing a good work, keeping up with the revenue and keeping up the profit they have. I know it's a tough comment when you look upon the data, but it could actually be worse in Norway given the market conditions. So our entrepreneurs in Norway are actually working extremely hard in order to improve the situation. So I have a great confidence in what they are doing, but they are in a very tough marketplace in Norway.

The next question comes from Alexander Siljeström from Pareto.

Starting off with a follow-up here on Norway. And looking at the quarter specifically, just wondering how much of the decline in organic sales growth that was related to sort of aggressive percentage of completion accounting in the comp from Q4 last year and also how much of the margin drag that was attributable to that?

Alexander, we have decided not to release the actual numbers. But as you referred to the project write-down we did in Q3 last year, part of that write-down was released in Q4 last year. And so that entity delivered strong profits. Meanwhile, as Johan referred to, we continue to have a challenging number from that entity in the quarter and consumed write-downs in combination with costs related to turning the point for the underlying operation of the entity. So that entity is actually delivering a loss in Q4 compared to very strong profits last year. So it is explaining part of -- a significant part and what are we referring then to roughly 30% of the decline year-over-year.

Okay. That's very helpful. So we can look at sort of the try to look at the underlying development in Norway on the market conditions. And then turning to Sweden, I would say, quite solid underlying growth given sort of your exits. What's your view on market conditions, are they improving somewhat considering that you seem to deliver growth here year-over-year, excluding exits? And when you talk about the margin uplift here into 2026, can we expect sort of 200 basis points as you sort of mentioned a noticeable uplift from here and that Q4 didn't seem to capture sort of the full momentum?

No. We actually have made a significant -- can you repeat the question, please?

Yes. So just on Sweden, I think the underlying growth seems quite solid. So just firstly, on market conditions seems to be maybe on the positive note and then also just the extent of the margin uplift that you're seeing to '26 considering that we didn't see the full extent here in Q4.

That's true. Yes, as we are closing down a couple of entities, then of course, that contributes negatively to the organic growth development. And if you clean the data from that one, the performance in Sweden is actually kind of decent given the market situation. And we do expect that we do not disclose, but it's a substantial magnitude of profit improvement we expect going forward in Sweden given the activities we have done.

And also that is -- in Sweden, that is public information. So if you look upon the companies and their performance as we are closing down, that would give you a rough idea on the negative EBITA contribution that will disappear as we move in. We have a slight impact in the first quarter, but it will give you a neighborhood number on the total amount of negative contribution that will disappear going into 2026. So I would say it's a fairly substantial improvement we will see going forward. That's what I expect anyway.

Market conditions in Sweden, when we talk to the managing directors in the local subsidiaries, they are definitely more positive. there are more quotes. They are writing more quotes. There's more work to be done. So yes, we are seeing that the market is improving in a positive way in Sweden. And of course, it will take some time as we have order books, we have contracts for the next 6 months and so forth. But we see -- I expect a gradual improvement in the market in Sweden as we progress through 2026.

Okay. That's also very helpful. And then maybe a final one, just wondering about your ambitions here on M&A into 2026. Are you still aiming at SEK 80 million to SEK 100 million in added EBITA or somewhat lower considering leverage and also maybe you're focusing more on the internal improvements?

They are not exclusive from each other, so to say, but it's very much true that when you have the leverage at 3.0, then we are becoming careful. So I know that Jonny from SEB is really pushing on the cash flow, so are we. And for the first quarter of this year, we really need to see that we have a good cash flow generation going on there, and that's what we have in the plan.

So assuming that we have a cash flow development as we expect, then the target is SEK 80 million to SEK 100 million. But of course, we are evaluating that one because if we see that we do not deleverage in the rate we would like to see, then, of course, we're going to slow down on the M&A activities and use the cash for deleverage. That's -- it's a gas pedal. We own those type of decisions internally. So -- but we do expect the deleverage in the first quarter, and we do expect the M&A agenda to continue and the target number is SEK 80 million to SEK 100 million EBITA to be acquired during the course of 2026.

The next question comes from Karl-Johan Bonnevier from DNB Carnegie.

Thank you for all the extra color that you've already given. But a couple of drill downs for me as well, please. Looking at Norway, just looking at that unit that you now described being, say, obviously very profitable in Q4 last year and now doing a loss in Q4 this year. How do you see the outlook for that unit going into 2026? Is that going to be normalized at a low level? Or is there still risk for further losses?

It will be normalized at a lower level.

And as I understand it, basically, the rest of the Norwegian operation is doing quite well in considering the market environment.

Yes. Sorry, the third element you have, that is, of course, again, as we have 2 companies who are road maintenance or one company as part of the business road maintenance and another large company is a road maintenance company. So yes, you will always have a part of the activities in Norway who are depending on snow removal.

So let's hope for the good snow also to hit Norway in the rest of the quarter. And looking at your commentary on Sweden that you just gave about that quotes are coming in quite nicely. You are building a good backlog. When you see the stability in the Swedish operation coming back, do you believe that we're also be going to be able to close in on the 8% margin target that you have on a group level in the Swedish operation?

Well, that's a good question. Well, if I give you -- not for Sweden alone, but if you look for all the companies, when we choose to invest in the business, we basically have a 10% margin as the goal that we do not really want to go below that number. And if we are going below that number, we really have a hard deck on 8%.

I will bring it up to the Board or to the management team if we see that the company has a profit level that is lower than 8%. And that is kind of the minimum expectations we have for the companies within the group. And that doesn't mean we will have 8% in Sweden for 2026. But on the average, we don't tolerate companies who basically have profit margins below 8%.

That sounds very fair. And -- but if you look at, say, the structure of the Swedish market, the structure of your Swedish business, there's nothing, let's say, fundamental that will mean that you will never close in on the 8%. That's what I try to aim for.

Yes. But that's a very -- I like the question, and you are absolutely right. The way we look upon the market is that the performance of the company individually is more significant than the market per se. There could be differences in the market, except that we have a challenging situation in Norway. But given normal market conditions, there's nothing that should -- that different Sweden from Norway, from Finland, from Germany. It's a company performance.

It's not that we have a customer who doesn't want to pay. It's similarities in terms of customer, it's similarities in the projects we are doing, and we have companies in Sweden who easily makes 10%. So it's more on the individual company performance than what they are doing or where they are based geography-wise. So Sweden does not show lower profit margins in the industry per se. That's where I'm coming from. And that means that if the companies in Sweden are not meeting the targets, we are not blaming the market in Sweden. They should be able to make that, and we have companies in Sweden who easily makes plus 10%.

Excellent. Excellent. And final one, looking at Other Europe, congratulations for a stellar performance in Q4. And similar thing there. When you look at backlog, look at quotations and the business you see coming into those units, is that still on par with kind of being able to deliver towards these levels that you see for the moment in this quarter?

For the vast majority of the companies, we don't see any major differences. So from that perspective, I would say the market is moving sideways. The market is booming in Germany. It has been on the low side for the last 3 years. And if I look at for the 2, 3, 4 years ahead, then I would actually say that there is room for market improvement in Germany versus where they have been for 1 year ago and where they are today.

So if I'm supposed to speculate, guess whatever you would like, then I would actually see that there could be room for market improvement in that market. And then, of course, we have a couple of companies who are really high profitable wise. Lithuania to mention one of them. There, we also see that those profit margins are perhaps not sustainable and will be normalized during the coming 2 years.

Makes sense. And I guess that's no difference compared to how you've earlier talked about it. And just one question also on the most recent acquisition, Finke. I noticed there seems to be quite a big project business in that operation. And you earlier talked about maybe staying away from projects. I know there's different kind of projects. What makes this one stand out compared to the previous one that you might have had problems within the project business?

Well, they really don't have that big projects. They have decent projects because if they were a big project, then we would stay away from the company. So -- they are doing decent-sized projects, I would say, all over Germany. They have very good relationship with 10, 15 customers who are recurring customers to that particular company, and they have a working relationship with them.

So they have a very sound foundation on what they are doing. So we like the type of work they are doing because they are doing the landscaping work when they are building new schools and that type of thing. So yes, they are slightly bigger than a playground, but it's not a big project risk company from that perspective. It's a repetitive customer who comes and it's business they know well on how to execute on.

It's more of a question that is the right type of projects rather than not looking at projects, if you put it like that.

Yes, I don't like the big projects to begin with. So we stay away from companies that have too big projects, then you add a project risk to the portfolio and that I do not like. So if you have a project up to EUR 2 million, EUR 2.5 million, then it's still within scope of work. But if you start talking about project sizes of EUR 4 million, then it becomes uncomfortable for us.

[Operator Instructions] There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. So thank you very much for listening in, and thank you all for the questions because it provides an opportunity on giving color, so to say, to the numbers. So we do really appreciate that one. And as we discussed, we have good progress in Europe.

I'm happy with where we are in Sweden. Norway is really where we are focusing on this point of time and the cash flow. So those are the 2 main topics we are working on in order to improve and looking forward to Q1 report in a couple of months here. So thank you very much.

Thank you all. Take care.

Welcome to the Green Landscaping Group Q3 Presentation 2025. [Operator Instructions]. Now I will hand the conference over to the CEO, Johan Nordstrom; and CFO, Marcus Holmstrom.

Please begin your meeting.

Thank you, and welcome to today's earnings call. And as mentioned, my name is Johan Nordstrom. I'm the Managing Director for the company, and I'm also joined by our CFO, Marcus Holmstrom, as mentioned, and he will take care of the Financial section of this presentation. But as always, let me tell you about our most recent performance and putting that into context.

So all-in-all, for the third quarter of 2025, we believe that we delivered reasonably well in the third quarter, in particular, given the market headwinds. However, if you look upon the results, they do differ quite a bit between our segments and in particular, Sweden and Norway, who faced the toughest market conditions. They did struggle to meet our expectations. But on the contrary, Other Europe, and that is Finland, Lithuania and Germany, they continue to outperform and delivered a very strong set of results.

We have also, in the meantime, invested in 2 good companies so far this year. And that has taken us halfway to our ambition of acquiring SEK 80 million to SEK 100 million of EBITA for the full year of '25. And this ambition remains valid for the remainder of the year.

We have also renewed and extended our bank loans during the last few months. And together with the bonds that we issued in May, we have effectively secured our financing for the coming years on, I would say, very good terms. So that's to frame in the performance.

So let's dive into the presentation. So let's move on, on the slides here. And just an overview of the company per se, the Green Landscaping Group. So we are, I would say, the leading landscaping company in Europe for ground maintenance and the landscaping industry. And there are three headlines I would like to go through there, and that is that we are active in a very attractive market. And what do we mean by that? Well, it's a very large market to begin with, enables us to choose what type of services we would like to provide, what type of customers we would like to have and so forth. And that is a strength that we are not in a niche. We are in a broad market. And of course, it's a stable market. And even now we are facing market headwinds, there's a great stability. So there are still an attractive market out there, even though it's -- I would say, more competitive than usually. And this market is also supported by -- I would like to highlight -- two mega or big market trends, and that is the 'urbanization' and the 'environmental'. And we do seek to be in those part of the market that benefits from those two megatrends.

Then in terms of our strategy about applying the right business model, we have learned since many years that being close to the customer is really the way to go forward. And that means that we have a delegated responsibility and that's when we talk about decentralization, it's about delegating the responsibility and the authority to people who are close to the market, close to the customers and close to the people who provide the services. And the upside is, of course, that we are agile and that we are more profitable than many of our competitors as we can provide a better service to the customer and getting paid for it.

Then the last item is about the M&A strategy as we are an active company who choose to invest in other companies. And we have been active for a long time, meaning that we have a long experience. We really know what we are looking for, and also we know how to take care and improve of the companies. And I think that's a critical part on the M&A story. It's not so much about finding the companies, even though that is very important. It's even more important from how do you take care of the companies, meaning how do you do the onboarding and how do we develop the company to be even better once they are being part of the group. And also to mention that we do have a solid pipelines of companies that we are in communication with. So I think those were the three headlines we had on who we are.

Now to sum up for the rolling 12 months, our revenue is pretty much unchanged. It amounted to SEK 6.2 billion versus SEK 6.35 billion. And organically, we are down by 9%, while acquisitions contributed to 9%. And we have to keep in mind here for the rolling 12 months, we have the first quarter that was basically a very weak quarter for us, given that we didn't have any winter activities or hardly any winter activities, I would say, in Sweden and in Norway. So we started out the year in, I would say, in a kind of a tough way. And then, of course, we have the market headwinds, and that's why we are basically flat on the net sales side. And then profit-wise, we decreased by 12% to SEK 463 million. And that means we have an EBITA margin right now for the rolling 12 months at 7.5% versus 8.4% a year ago. I think that's kind of the telling for the story.

If I look upon the revenue, it's kind of slow development, I would say, for this year, while we lost 1% in terms of the profit margin. I think that's kind of a solid performance, even though I'm not happy with the performance. But if I look upon it from a macro perspective, that's where we are. I think that's an okay performance.

Cash flow from operating activities amounted to SEK 390 million, down -- slightly down compared to previous year. And of course, for the last 12 months, we have completed 5 investments in other companies.

Now moving into the third quarter, we can see that net sales increased by 4% to SEK 1.6 billion, while organically, we actually had a negative 3% in the quarter. So from that perspective, I think we're doing okay, while we saw that we were down on EBITA by 12% to SEK 114 million. And you have to bear in mind here that what we typically don't work with adjusted EBITA. So we did adjust for a project write-down in Norway to the tune of SEK 21 million. So if I add that one back to SEK 135 million, that actually put us back on where we should have been under normal circumstances.

So from that perspective, EBITDA at SEK 140 million, and that gave us a margin of 7.1%. and then, of course, we have the cash flow of SEK 47 million. That one came in, I would say, slightly lower than our expectations. The third quarter is a strong quarter from a cash flow perspective. It's basically the fourth and the first quarter that's our strong cash flow quarters, but it's on the weak side I agree on the cash flow. And that gives us a financial leverage at 3.0 versus 2.7. And as we move forward, we will see a natural deleverage in the fourth quarter, anything else equal.

Also, as I did mention, we did have the new finance agreement in place in October 2025. And then, of course, we completed one investment in the third quarter, and we confirm our ambition to invest in about SEK 80 million to SEK 100 million for the remainder -- for the full year effect of 2025.

So long-term performance. So we are a, I would say, a fast-growing company and have been growing quite significantly during the course of the years and also that we have a resilient in adverse market conditions. If I look on the year 2025, I will say that this is a year where we do not see that high growth. Organically, we are down while we are adding companies to the strategic growth is working, while the market headwinds are actually negative contributing. And that's basically why we are flat on the growth side as a company.

Coming back to the profit margin that we are at 7.5% versus 8.4%. And I would say that given the market conditions that with the Q1 performance without winter and the headwinds in Norway and Sweden, I'm not overly happy with the 7.5%. But on the other hand, it's 1 unit of percentage down. So it's still a stable performance. So I think that proves that we are working in a stable environment. So even though we are facing a lot of headwind, I think the performance is, given the circumstances, I would say okay in terms of profitability and cash flow.

Looking upon Sweden, so moving into that one. There we see that we are down quite significantly by 40%. There are two reasons for -- that we are shrinking in Sweden. The number one is, of course, the headwind in the market. But the other way, there are things also that we are closing down unprofited business. So those 2 items together are the ones that is accruing to 14% down on the net sales. And then, of course, the EBITA is down by 39%, and that is a significant number. And that is also with the conjunction we have with the market condition as well as cost for closing down the companies that is not performing. But as a whole for Sweden, when I look upon it, even though the numbers are bad, I agree. But I think we have turned a corner on Sweden. So for the coming -- not so much for the fourth quarter, but coming into the year of 2026, we see a significant upside in Sweden, and we do expect a significant -- both recovery and that actually should -- what do you say, succeed or surpass the profit margins level we have shown historically in Sweden. So it's actually looking good that we finally have turned a corner in Sweden, and I'm looking forward to the performance in the coming year to show the numbers in Sweden. So that is actually looking quite good.

Moving on to Norway, and we look upon the rolling 12 months there. They are -- given the conditions again, they're actually keeping it together revenue-wise in a very good way in Norway. So they are keeping up the volume. However, it comes with the price, that is the profit margins. So we are getting the work, but it's a high competitive environment in Norway. So we are keeping the revenue at, I would say a good level, while we are doing this by lowering the prices. And by that, we are sacrificing our profit margins in order to keep up the volume.

So the net sales achieved in Norway was SEK 2,467 million, where you had an organic negative contribution of 7%, while we had one acquisition, if I remember correctly, that contributes with 5%. And as I did mention, we had a significant decrease in profitability by 40%. That's quite a big swing. And that's to a large extent, the market conditions that we have in Norway right now.

Moving on to the third quarter performance, we saw that we only shrunk by 1%. So again, we are keeping the revenue high, while we had a significant drop of 75% on the profit. And that is two reasons for it. It's the challenging market conditions, as I did mention. But also, we made one project write-down or actually, it was more than one project per se, but it's in one company. So it's an isolated event in one of our bigger entities in Norway, where we, in the beginning of the year, had a change of the Managing Director and later on, we changed the CFO. As they started to look into the company, they did -- they were not happy with the performance or the way the projects were accrued for. And that meant led us to a project write-down to the tune of SEK 21 million that we actually went for in the third quarter this year. So it's from that perspective, it's a significant write-down, but it's a one-off in Norway.

Moving on to Other Europe. So for the rolling 12 months in Other Europe, we have a significant increase of close to 50%. So they achieved almost SEK 1.3 billion. So they were fast growing, but they have an organic growth of 2%, while the acquired growth was 48%. So there's both organic as well as strategic growth in that market. And then, of course, we had an even higher increase in profitability by 52%, that led us to a margin of 19.8%. So I would say it's a fantastic performance in that region. So that is Finland, Lithuania and Germany. And we can see that Finland is since 3 quarters, I believe, on a very positive trend. So I'm happy to see that one. Lithuania continues to perform in a very good way. And then we have a stable performance of our entities in Germany.

Again, looking upon the third quarter performance, we saw that we had a growth of 35% in the quarter, and we had an EBITA increase to SEK 96 million, and they actually delivered a stellar performance of 22.7% EBITA margin in that region. So that is really working for us.

Then, of course, to the last slide here that we do welcome Tessmer & Sohn, who is a company that we acquired a while back. They operate in Hannover, and it's kind of a classic company in terms of what we are doing. They're offering landscaping, earthwork and drainage services. They have a revenue of about EUR 16 million, and they do that with about 45 employees. So we do welcome Tessmer & Sohn into the group of Green Landscaping companies.

So by that, I hand over to Marcus to go through in more detail on the financial side. So welcome, Marcus.

Perfect. Thank you, Johan. And I will cover the main financials. Moving into the quarter, we can see that in Q3, we had a net sales of SEK 1.6 billion, concluding our rolling 12 months to SEK 6.2 billion. And as Johan mentioned, our strategic acquisition compensated for the negative organic growth we have had during rolling 12 months. So from that perspective, we've been flat.

On an EBITA margin perspective, in the quarter, we delivered SEK 114 million, which was lower than last year, but then we must have in mind that we then absorbed this project write-downs of SEK 21 million from one subsidiary in Norway. And adjusting for that, EBITA would have been SEK 135 million, which is slightly exceeding last year. And doing the same calculation to an adjusted EBITA margin would be roughly in line with last year on that level.

I will cover cash flow in more detail in the upcoming slides, but we conclude that operating activities contributed with SEK 47 million, which was slightly weaker than we had expected, but we foresee that it will come back to us in Q4.

Financial leverage increased sequentially to 3.0x, and the order backlog amounted to SEK 7.4 billion, which was lower than last year, and we've seen it for a few quarters now, and the decline was particularly noticeable in Norway and to a lesser extent in Sweden, while other regions were more stable. But it's also, as we always say, it's important to note that the order backlog fluctuates between quarters, so should not be viewed as a short-term leading indicator.

Looking at our earnings per share in Q3, it declined 42% to SEK 0.56 compared to SEK 0.96 last year. And the drivers behind that was the lower profits delivered from operations, but we also had last year a positive net currency effects in our financial items that impacted that year positively.

Moving to cash flow. In line with seasonality, our cash flow turned sequentially positive now in Q3, but it was slightly behind what we had expected, and that was mainly due to that working capital increased by SEK 71 million compared to SEK 25 million during last year, but this will come back to us during Q4, and we have a high focus on this conversion rate.

Now, rolling 12 months cash flow came in slightly below last year at SEK 390 million compared to SEK 399 million. And working capital development and cash flow generation continue, as always, to be a high focus area for us, and we expect the cash flow to be strengthened in the fourth quarter, in line with normal seasonality.

Looking at the quarter's cash flow bridge. As mentioned, operating activities contributed with positively SEK 47 million. Then we made one acquisition impacting cash flow negatively of SEK 77 million. We have CapEx and lease amortization of minus SEK 73 million. And then with the net difference of new loans and debt repaid was plus SEK 50 million, concluding our cash position negative for the period at SEK 53 million.

Looking at financial leverage or -- financial leverage and financial position. Financial net debt increased to SEK 2.5 billion, which was sequentially roughly SEK 100 million higher than in Q2, driven by working capital and investment activities as we could see in the previous slide. Leverage increased sequentially from 2.9x to 3.0x, which is temporarily above our financial target. However, we maintain sufficient headroom to meet our financial covenants in our funding agreements. And as we enter Q4, which is usually our strongest cash flow quarter, we have a high focus to deliver upon that seasonality.

The loan maturity overview, it has been updated since the last quarter. Following the end of the third quarter, we successfully renewed our bank loans in line with our long-term plan as they were maturing in 2026. Together with the bond issued during the second quarter, we have now secured and broadened our financing base for the coming years. The new loan terms were significantly more favorable than previous ones, which will help us to reduce interest costs going forward. This is not only strengthening our financial position, it's also sending a clear signal that the credit market has a strong confidence in us.

The concluding slide on my end by reviewing our financial targets. We can see as both Johan mentioned and I mentioned, we have a financial target of 10% of total growth. But in light of the market headwind we have faced during this year, we are actually on flat despite us continuing on the strategic acquisitions.

The EBITA margin, we came in at 7.5% rolling 12 months perspective, which for us is of course, below our financial target. But once again, it's for us a testament of that our business model has the margin resilience we foresee in tough market conditions.

Then looking at financial leverage, which is at 3.0x and temporarily above the financial target. But as expected, we should come down towards the financial target at the end of the year if we follow the normal seasonality.

We have a fourth financial target of distributing dividends, but in line with the previous year, the AGM decided that we should not distribute any dividends for the fiscal year of 2024.

And with that, I hand back to you, Johan.

Okay. Thank you, Marcus. That was quick. So just to sum it up here, I think it has been a challenging year for the 2025. And as Marcus said, I believe we are a resilient company because if you look upon the profit margin, EBITA at 7.4% versus the 8.4% that we compare with. And given the market conditions, I think it's a solid performance even though I'm not happy with the performance per se, but it's a soft market this year or tough market conditions and seeing that our profit margin at 7.4%. So, I'm still happy with the performance, even though I'm not happy with the number to sum it up. So I think that's pretty much where we are.

And by that, we move over to the part where we open up for the Q&A session. So we hand it back to the operator to open up questions. Thank you.

[Operator Instructions]

Sorry, there was a problem with the AI here. So the first question comes from Jonny Jin from SEB.

A couple of questions from my side. I want to start off to come back a little bit to the project write-down you had in the quarter of SEK 21 million. I think I lost you a little bit there, but could you maybe elaborate what happened there? And maybe more importantly, do you see any more similar projects in the books that risk to be written down ahead? That's my first question.

Okay. So thank you for the question. And I always want to say welcome to the club. I think that's the first time we are in communication here. The project is from one of the -- it's one of the bigger companies we have in Norway who had been on a positive trend profit-wise. So I was kind of happy with that one. And then as we replaced the Managing Director as well as the CFO in that company, and they started to look upon the project and the valuation of how we have valued that project. And they weren't happy with how that had been done. And that actually goes back into the previous years as well.

So then we went into a thorough analysis on that particular company on how it was accrued for profit and so forth. And then we ended up with taking a conservative look upon what's going on there, and that led us to do -- to reduce the project profits in the current projects they had and be more conservative going forward into the future. So that's the reason for it.

So it's one company where we had a new management in place who went through the order books and the current project they have and decided there was a need to do that write-down. And we also have to keep in mind that we do have our auditors and everybody else involved in this one. So we took a conservative view and did the write-down that is needed to the best of our knowledge at this point in time in that particular company.

Okay. So you don't see any more risk that further project will be write-down ahead?

No. We did the analysis. And of course, we have 50-plus companies within the group. So this is one company. I'm not saying there's a risk in other companies. I'm saying that we don't -- we have a conservative view on it, and there is no risk of having a follow or you should have any consequences in other companies as well. This is one company where this occurred to us when we replaced the management and then we took the consequences of it and did the write-down. And then we are moving forward for the next quarter.

Okay. Yes. Okay. We see. So how -- speaking of the order book, how is the general margin quality now, would you say, in the order book, particularly if we go into Sweden and Norway as organic growth seems to stabilize there, but margins continue to decline. So how should we view on the margin going forward?

I think that it's a tough question. But of course, if I look upon the market, and we typically don't disclose too much information about looking into the future there, but it's kind of common knowledge I would say that there's a slight optimistic view on the development in Sweden, as a general mark or remark. And I think we -- given what I hear from our managing directors in Sweden, we concur that they are much more positive to what's going on in the marketplace at this point in time, meaning that there are more projects to bid on. And to some extent, I won't say it's less competition. But of course, if there is more projects, then of course, that will have a positive effect on the project margins.

Then of course, if you have an order book that you have won when the market was competitive, it will take some time before you will see the increased profitability in the new projects coming into place. So from my perspective, when I look for Sweden in the fourth quarter, it might be a slight upside. But of course, you have to work through the order book you have until you will actually see, let's say, a significant uptake on the profit margin. So I foresee Sweden being more or less equal moving into the fourth quarter. It won't be an immediate effect.

I have a slightly more conservative view on Norway. I don't see the same market development as we see in Sweden. So from my perspective, when I make my plans or our plans, I would say for the coming year, I don't see any big change in Norway. So there's a tough market conditions, and I don't see margins changing. I would see that the margins that we are currently winning at that we will continue to do that until further on in Norway. So I'm not forecasting any change in Norway at this point in time, and I don't have the signs of anything going on.

In terms of Finland, I think it's actually our performance in Finland that makes us more profitable. So there, we are on an improving profit margin. Lithuania continues to outperform and so does Germany. So all-in-all, I'm slightly positive to Sweden. I'm very positive to rest of Europe, so to say, and I have a conservative view on Norway.

What is driving the weakness in Norway, would you say? It sounds that it could be a little bit -- is it a structural shift that you see now? Or what part of your business is driving this weakness, would you say?

Well, you have two factors. We had a tough start of the year because in Norway, we have a snow dependency to begin with in Norway. So we have to keep that in mind. And that gave us a very weak start of the year, and we are still struggling with that one because we have companies like Hadeland Maskindrift and those companies. They are road clearing companies. They remove snow during the winter. That's what they do. And if you don't have winter, it's a tough situation for them. So they started out in a tough marketplace to begin with.

Then the market per se in Norway is quite competitive. You have a lot of bankruptcies going on. There's no risk of any of our companies going into bankruptcy. It's very well-kept companies. They are a well-run company. They are adapting to the market conditions. And you can clearly see that they are adapting to the market conditions in terms of keeping the revenue decently stable, while in order to do so, they have to be more aggressive when they submit the quotations. And that hurts the profit margins in Norway. And as soon as the market comes back, and this is basically macroeconomic, to the best of my understanding, we haven't seen any change in interest rate and so forth in Norway. So I think there is a stability in the market, but it's a very high competitive environment in Norway at this point of time. Yes, sorry.

Yes, sorry. I understand. We will see. But then I have just one final one on the cash flow and maybe tying that to M&A. I think you mentioned in your presentation that cash flow in this quarter came in below your expectations and that you relate that to working capital. But maybe you could elaborate a little bit more what happened here in the quarter that drove this weakness in the cash flow?

And then tying that to M&A, I mean, your reported leverage is now at 3x EBITDA, and that is up sequentially compared to Q2. So do you think that cash flow will be strong enough in Q4 here so that you could acquire this SEK 30 million to SEK 50 million in EBITA this year? So that would be helpful.

Yes. I can take the first part of the question maybe. And yes, as you say, Johan, we were on a weaker end of what we had expected on the working capital conversion in the quarter. However, when we compare to last year, last year was standing out from a seasonal perspective in terms of reference on how much we usually manage to convert. We are addressing it, and we have -- we feel comfortable with the working capital position that we go into the quarter that we will be able to convert it in line with normal seasonality, everything equal.

So from that perspective, we're having a high focus on it and pushing for collection out in our subsidiaries, and it's basically that simple for us.

Then, of course, we are monitoring our leverage position, but in light of our confidence on our operational cash flow, of course, 3.0x is not the levels we want to be at. But everything equal, we will deleverage from this point during Q4.

So the way we look upon it is actually that we will be able to both start to have a deleverage on the 3.0x and fulfilling our promise on the acquisitions. So we can actually do both items in a better way during the fourth quarter.

The next question comes from Alexander Siljestrom from Pareto.

So a follow-up here on the performance in Norway. Just wondering what has driven the sort of sequential margin decline here in Q3 as compared to Q2 as I would assume that sort of the contract portfolio is quite similar?

Yes. From that perspective, Alexander, we meet more -- we feel that the market is tough, and it is a bit tougher from that perspective now in Q3 compared to Q2, not a significant movement, but we see that as we work through the order book, as Johan said, new contracts going in, we are on another mark awarded on more price pressured levels. And that we can see in general in our subsidiaries in light of the performance report. Other than that, it is the project write-down that stands out.

Yes. And sorry, this was excluding the project write-down and --

Yes.

-- maybe just on that as well, you guide for sort of more depressed margins in Norway going forward. And then maybe excluding sort of Q1, is it around sort of a 6% level that you see here going forward as well? Or what should we sort of account for looking into 2026 for Q3 or Q2 maybe?

Yes, we don't guide from that perspective in that sense, but we have circumstances this year, which the year begun with that we had a normal winter activity -- winter demand. And then going into Q2, we managed to perform fairly well in light of a tough market. Now what we see is that the tough market impacts us to a more significant extent and what margin levels to expect in next year, I guess we will come back to. But for sure, we're pushing for improvement from these levels we are.

Yes. And sort of the weakness is mainly explained by landscaping and soft pricing on increased competition. Is that correct in terms of Norway?

Yes.

Yes, it's as we said. We started out the year with significantly less winter activities. And then, of course, there has been a high price pressure in the marketplace. And I think that's the market we had in 2025 in Norway. And the winter, I would say --

Yes.

-- was very unusual in Norway. So that gave us a tough start for the year.

Yes, for sure. And then maybe moving on to Sweden. You seem quite confident on margin improvements heading into 2026, and you mentioned a market recovery. Just wondering what else -- which sales drivers do you see here for improved margins?

Well, not -- I don't -- of course, we had an impact again on the winter in Sweden as well as in Norway in the first quarter. And also, we have done significant changes in Sweden with closing down companies and unprofitable businesses and so forth. So we have actually made a major turnaround of the Swedish business.

So when I look into the 2026, assuming we will have a somewhat more normal winter activities, and that the market is actually slightly improving in Norway -- sorry, Sweden, that leads me to believe that, yes, I'm actually quite positive on the development of the margin in Sweden for 2026. And I probably have to eat up my hat because of that remark, but that's how I look upon it. I see that the market is recovering. I assume we will have a more normal winter activities, and we don't have the burden of the companies who are losing money. So I'm positive to what's going to happen in Sweden for next year.

That's encouraging. And then maybe just on Sweden in Q4, my guidance seems quite muted. And if I remember it correctly, you had sort of one-offs that weren't disclosed, but I think we're around maybe SEK 20 million in Sweden in terms of credit losses and write-downs. Don't you see the positive effect on that in Q4? Or do you see sort of an organic drag offsetting that in Q4?

I really don't understand the question. Can you clarify it for me?

Yes, sorry. So in terms of the Q4 performance last year in Sweden, I think you had some one-offs of maybe SEK 20 million. And then you guided for a sort of muted performance here in Q4 in Sweden. So just wondering if you see a continued organic drag here in Q4?

Yes. We had a few one-off items in Q4 last year, Alexander. As you mentioned, it was a credit loss in terms of SEK 5 million and then also a project-related write-down roughly SEK 5 million. On top of that, we now see that we still will be affected by these activities that we closed down these loss-making businesses that we will go clear out from with the end of this year. So we still have some losses to absorb from those ones. But in terms of that, we see that the organic growth will sequentially improve during Q4 compared to Q3.

Okay. And have you done any sort of major exits here in Sweden during this quarter that will affect Q4 negatively?

No, not impact negatively from that perspective, as you mentioned it. But of course, these businesses that we decided to close down due to the -- due to their position and that they were loss-making, they have -- we have absorbed that during the year, and that is one of the effects Johan refers to when we look into 2026 that will positively contribute. The effect in Q4 will be compared to last year, minor, but then we will have the positive in 2026.

Okay. That's clear. And maybe then a last one from my side. Just looking at the order book, I think it was down 7% here. Can you share some color on that? And we -- what's driving that decrease? And how should we look upon it?

Yes. The sequential decrease of the order backlog is mainly related to Norway. So even if we say that we don't use the order backlog as a short-term leading indicator, it confirms that the market descriptions that we tell you here in the call reflects also how the development of the order backlog has been in the quarter. And it's fairly stable in all regions, except that we are minorly down in Sweden and the residual adjustment is actually in Norway.

The next question comes from Karl-Johan Bonnevier from DNB Carnegie.

Thank you for all the additional color already given. And just to pick your brain a little Johan on the Norwegian development further. You've obviously gone through what I would call a little more a surgical procedure to get Sweden to becoming a positive outlook into 2026. Do you feel that there is a need for doing something similar in Norway?

Karl-Johan, and thank you very much for the question to begin with. The starting point of Sweden is to a large extent, the legacy units of what was Green Landscaping at the time and also Svensk Markservice. And those 2 entities had a combined revenue of roughly SEK 1.6 billion, SEK 1.7 billion. And at the time, they were loss-making entities. And we have been spending a long time getting those companies into shape. And finally, we're actually seeing that those companies are starting to perform in a very good way.

So I think that's the starting point. So it's a long history of how those companies were centralized and then became decentralized and then we added companies by acquisitions to it, and that was early on and perhaps we did acquire 1 or 2 companies that we shouldn't have done in the beginning of our -- let's say, consolidation journey or rollout journey.

Norway is from that perspective, totally different. Norway was even though early on in our acquisition strategy, so to say, that we started to buy companies. We have actually acquired -- I don't know how many, but at least 10 companies or 15 companies before we actually entered into Norway. So we were in a much better shape in terms of what we're looking for in terms of type of companies, how do we take care of the companies. And I would say that the quality of the companies -- now my Swedish colleagues is going to be quite mad, but the quality of the companies that we have in Norway had a totally different starting point. So we have quality companies in Norway. So the deep rooted difficulties that we have had in Sweden that we do not have in Norway.

So right now, the situation in Norway in the quality of the company or companies as we have, these are well-run entities with very good entrepreneurs who are actually doing whatever they can to perform in a very tough market situation. So from that perspective, I don't see us having to do that type of work as you are referring to, where we have to be a little more heavy handed if you understand what we did in Sweden. There's no need of doing that in Norway because we are managing the companies even though it's a tough market in a good way. And I do expect our entrepreneurs in Norway that as the market returns and become more healthy, we will actually see significant an improvements going back to the old performance they had in Norway.

So I think the starting points are quite different. So there's no need to do the same type of -- let's use the word heavy handed as we did in Sweden. We have a much better starting point in Norway than we had in Sweden.

It sounds -- it makes total sense. It makes total sense. And on that subject, I guess that makes you more, say, positive towards the local management teams in Norway maybe chasing volumes at lower price points to keep market positions at this stage to basically hard -- [ hibernating ] until the market recovers. Is that a good way of looking at it?

I think you can look upon it from 2 ways. What I clearly see in Sweden is that there is -- given that the history we have and a very high focus on cash flow and profit margin in order to increase that in Sweden, then I think several of our Swedish entities are focusing on cash flow and profit margins and not so much on the revenue side, while our colleagues in Norway are coming from a position where they have high profit margins and high revenue.

Then, of course, when the market becomes difficult, they are winning contracts at lower margin. Do I think that's a good strategy? I think it's, to some extent, okay, but there is a danger to it because you're actually adding risk to it as you are lowering the margins. And the key question is that if you have lowered your margins, you have to make quite certain that when the market recovers, that you're actually recovering the margins and not the revenue. So you are not getting used to -- if you take a company who has gone from 15% to 7% profit margin in order to win the contracts, and all of a sudden when the market recovers, should they keep the 7% or they're happy at 10%. Now we have to move back to the 15% where we are coming from. So I think that will be the challenge in Norway as the market is going to recover, then we have to be quite focused on recovering the margin that we had before in Norway.

There's no doubt in my mind that the majority of the entrepreneurs are quite aware of this, and they would execute accordingly. But there will be a lag, that's my experience anyway, that you will see that the market is recovering, you will see that the revenue is recovering and then you will see that the profit margins will take a little bit longer time before they recover and come back to where they were.

So -- but we are aware of the situation. We are in communication with them. We have a heavy focus from the operational team in Norway. So they are spending a lot of time with our -- they're actually spending more time in Norway these days than they do in Sweden. So from that perspective, we are focusing on that subject. So as soon as the market is going to recover, then of course, we're going to recover the profit margin as well. So that's my take on it.

Sounds logical. Sounds logical, and it's going to be an interesting journey to follow. On the back of short-term demand opportunities in Norway, you had a hope earlier in the year that maybe the low snow removal volumes would allow budgets to be replenished maybe in other parts of your business coming up to the end of the year. Have you seen any of those kind of projects? Or is that a hope that we shouldn't put much into at this stage?

Sorry to say, I would be careful doing that given the market conditions.

Sounds logical. And one final from me. Looking at you're keeping the acquisition kind of range of SEK 50 million to SEK 80 million in contribution in EBITA for the full year. I guess that's the speed of it. Looking at what has happened here during -- so far in this year, is it -- have you held back on transaction for some reason, maybe out of the cash flow perspective, financial leverage and getting the new credit lines in order and maybe even having bigger opportunities in those credit lines to do acquisitions on top of the gearing level you have at this stage? Or have you, say, in the transaction you've been involved in or looked at been outbid by somebody else or any change in the dynamics on that side?

No. I think that to be honest here, the major competitors are not in a position to do any acquisitions at this point in time. So we are actually one of the few companies who continues to acquire at this point in time. So anything else equal, I would say that we are in a good position on doing it. I'm not happy with the leverage. That is too high. So that one needs to come down. But it will come down organically, but I will also have the capacity to do investments. So we are not holding back.

However, given that the situation where the market is tough and there's less competition because there is less competition on the acquisition side, we are really not holding back. We have a plan on how much we should acquire and what type of companies we should acquire. And in terms of the quality, I think we are actually increasing the quality of the companies that we choose to invest in. So if anything else we are becoming more picky in this market situation. And that actually means that we are buying more quality companies. The price situation or the price competitiveness, if I go back 3, 4 years in time, we were outbid by 50% to 100% and those days are gone. So now if anything else, I'm not saying you won't see a significant decrease in prices, but anything else -- the competition in terms of acquiring companies are actually lower today than it was a couple of years ago or significantly lower, I would like to say. And the quality has gone up, and we're paying approximately the same amount of money as we did in those days.

So we are managing the debt level quite carefully or the leverage quite carefully. And we have a well-developed pipeline. We never have had such a good pipeline of companies as we have today. So we are having a plan, and we are actually executing very close to our plan. So that perspective of the business works very well for us.

Sounds very good. You're summing it up very well, Johan. And good luck on executing it out there and all the best.

Thank you, Karl-Johan.

Thank you.

[Operator Instructions]. There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Okay. So thank you, everybody, for listening in, and thank you for all the questions that we did receive during this call. And by that, it concludes the presentation. Thank you.

Thank you all.