Husqvarna Aktie

Good morning, everyone, and welcome to the presentation of the second quarter results of 2026 for Husqvarna Group. My name is Emelie Alm, and I am Head of Investor Relations. I'm joined here today by our CEO, Glen Instone; and also our CFO, Terry Burke. So Terry and Glen will go through the presentation, and we will then have a Q&A session.

So with that, I would like to hand over to you, Glen.

Thank you, Emelie. Good morning all, and a warm welcome from my side, and welcome to our Q2 report. So let's jump straight in. So following a very strong start to the year with a strong sell-in to our trade partners and very successful product launches, Q2 has been somewhat difficult. That's been really geopolitical uncertainties and a weaker consumer sentiment has certainly weighed on consumer demand.

And we also had a somewhat unfavorable weather conditions really impacting the first half of the quarter, the first 6 weeks of the quarter, and that certainly had an impact, particularly in Europe. Despite that, we managed to see good growth in North America, and that is a good build on where we were actually after the first quarter. So we're very pleased with the continued growth in North America. Of course, the lower volumes overall and higher cost inflation is impacting our margins. However, very, very pleased to see our cash flow develop strongly into the strategic execution perspective, I'm actually very pleased with where we're heading.

We've managed to actually achieve and implement strong savings, and we've triggered some strong savings programs. And we've also accelerated our strategic portfolio work in terms of making some firm decisions during the second quarter. And again, I'll come back to them in more detail as we go through the presentation. So all in all, second quarter, our activities have been very, very good.

What I'm very pleased to see is actually we've managed to finalize our recruitments of 4 new group management members. All will join us during the remainder of the year. Actually, Anders, Lily and Patrik will come in during Q3 and Anders Candell will join us during the fourth quarter. The one addition to the group management team is actually the CPO, the Chief Procurement Officer with Lily. That is a new position we've created because we really feel sourcing and procurement is a strategic value creation lever for this group. It's where we feel we can add more value, and it is much more than just a cost area.

So having this really put together under one leader at the executive table who's really going to drive our strategic sourcing agenda as well as a common agenda around supplier strategy that is going to add a lot of value as we go forward. And within our total cost-out program, sourcing is the biggest lever. And as such, we're very, very pleased to bring Lily to the table and into the executive team. So very, very pleased with the new perceptions, the new experience that the 4 new leaders will bring to the group.

So just to look at some of those strategic highlights that I mentioned on the first page that I'm really happy with during the second quarter. I'll give some examples. These are just a few examples. Within the area of logistics, we started to look at this much more holistically as a group. We've actually managed in the logistics network to reduce the number of suppliers by 2/3. That is quite a big number. That will help us with cost savings, but actually more importantly, help us our service level agreements. So we expect increased service level agreements and service level rates as a result of this. And of course, we see a cost saving that will start to impact and benefit us going forward.

We've also managed to do some good warehouse consolidations already during the second quarter, and this will continue now going forward in the remainder of the year and into 2027. So reducing the number of warehouses we have and therefore, also over time, reducing the inventory as well that we have, again, driving savings, lower inventory, but also benefiting from the better service level agreements from the logistics providers. In the manufacturing footprint area, an example we can also bring is what we've been doing in the Gardena Division.

We've been very much looking strategically at manufacturing in terms of where the core skill set sits. And we're going to move some operations from Germany into Czech Republic. And the main rationale there is where we have high-volume, highly automated processes, they will stay in Germany, where we have more labor-intensive, more manual processes, they will be moved into the Czech Republic. Again, very strategically set strategic manufacturing footprint. This will, in essence, impact the hand tools and watering business portfolio units within the Gardena Division.

As part of the strategy, we talked a lot about strategic portfolio management. And by that means we're going to address our underperforming parts of the portfolio to spend more time on the high-performing business portfolio units. And some of the measures we've taken during the second quarter, one is our intention to discontinue our stone diamond tool business in the Construction Division. This will be done during the remainder of 2027 and have an impact on sales of some SEK 250 million, but be EBIT margin accretive both to the Construction Division as well as the total group.

Today, we also announced that we will move from a turnaround case to a strategic review of our Powered Garden business portfolio unit within the Gardena Division. This continues to be pressured as a segment, and therefore, we're going to really move this into a more formal strategic review. And we will come back to you with the results of that and our firm decision during the first couple of months of 2027. So very, very pleased with what we're doing and the decisions we've made during the second quarter.

From a total cost-out perspective, we're actually ahead of plan. We previously indicated a cost savings program of some SEK 4 billion effective by 2030. And given the second quarter, we've actually managed to add some SEK 385 million in savings on the back of a SEK 245 million benefit in Q1. So SEK 630 million run rate savings already effective now. This actually gives us the confidence that we need to increase the timing effect of our savings.

So as such, we now target achieving some SEK 3 billion effective by the end of 2028. We remain with the SEK 4 billion, but want to really increase the benefit and the timing of that benefit. So SEK 3 billion in the time frame 2028. And the reason we're also doing this, of course, headwinds continue to come. The Middle East crisis does impact raw materials and logistics, and we need to continue with our savings initiative to make sure we more than offset those headwinds that we see going forward.

I'm extremely proud and pleased to announce that our science-based targets have been validated during the second quarter as well. So our targets of reducing our carbon emissions by 60% versus the 2015 baseline have been validated during the second quarter.

This is a further support to what we're doing, and we're very happy that the science-based targets have been validated in this way, and we'll continue driving this by way of electrification as the portfolio electrifies, really driving further carbon reductions through our total supply chain and our operational excellence programs and also really looking at how we engage with our supply chain partners to make sure they are also reducing their carbon emissions and really walking the talk in terms of our commitments when it comes to our carbon reductions.

Over to the P&L, and we'll start with sales. Sales in the second quarter organically declined by 4%. I just want to put that in context. We had a strong sell-in in Q1 with a positive 3%. We also had a very strong quarter 2 in 2025, actually had a positive 5% sales. So 4% decline given the macro uncertainty and given the weak consumer sentiment is actually reasonable, especially looking at that in conjunction with the prior year and the strong sell-in in Q1.

We saw a decline in the Forest & Garden Division of some 3%, a decline in Gardena of 11%, but a growth in the Construction Division of 5%. As mentioned on the opening slide, we certainly saw, let me say, more of an impact in Europe. Weak consumer sentiment globally, but the weather impact in Europe certainly weighed on demand in terms of that replenishment cycle that we normally see, particularly early in Q2, which are our main selling months. However, very pleased with the performance in North America, a continued improvement.

And actually, that improvement was across the board, all 3 divisions growing in the second quarter and across most of our product categories. So very, very pleased that North America takes a further step forward. If we look at that from an earnings perspective, we generated earnings in the second quarter of SEK 1.95 billion. And that is an operating margin of 13.6%, corresponding to 13.4% in the same period last year. However, worth calling out that we did have a tariff refund during the second quarter of some SEK 240 million, costs that we took during the course of last year, and we've managed to get refunds into our P&L this year.

So SEK 240 million into the P&L, and that's in the COGS numbers. However, having a lower 4% top line, of course, impacts our volumes, has an impact on to the P&L, and that's the main drag that we see actually impacting our earnings. Terry will cover this in much more detail in the EBIT bridge, but we also had, of course, some headwinds from raw materials, some logistics costs as well as a negative impact from FX.

If we look at this on a division level, we start with the Forest & Garden Division. The second quarter, we saw a decline of 3%. That was following a strong Q1. So actually, through the first half year, we see a flat sales development despite the macroeconomic headwinds and despite the uncertainty we're seeing out there. So all in all, still positive.

In isolation in the second quarter, that weak consumer sentiment particularly impacted the Wheeled business portfolio unit, and that was actually mainly in Europe. We actually had a growth in North America there. North America, despite also growing with -- despite growing on wheeled products, also had a growth in handheld products. So good growth across the core categories in the North America space.

In particular, the tariff refunds of SEK 240 million on the group, some SEK 112 million was attributable to the Forest & Garden Division. Lower volumes also, of course, impacting the division and cost inflation is a headwind in terms of raw materials and logistics and a significant FX effect there of some SEK 45 million. But all in all, operating income, excluding items affecting comparability, moving from 13.3% to 14.3% in the quarter.

Moving over to the Gardena Division. And of course, the headline number there is minus 11% in sales. But again, I want to put this in context. This is comping to a plus 7% in the same quarter last year. So we had a very, very strong quarter 2 last year. and we now see it at minus 11%. We also had a very, very strong sell-in in Q1, particularly in watering in the Gardena Division. And we indicated that during the Q1 report that the channel partner inventory was slightly elevated as a result of that strong sell-in.

So of course, colder weather, weaker consumer sentiment has impacted the replenishment and the sell-through. But all in all, we have extremely strong positions through the first half year, particularly in the watering segment, strong market-leading positions, and I do want to leave you with that. Tariff refunds for the Gardena Division, relatively small, only SEK 29 million of the SEK 240 million. Of course, the negative effect from volumes does weigh on the margin.

And we also see actually one of the turnaround cases we've been talking about that we now move to a strategic review is the Powered Garden business portfolio unit. And that also, of course, dilutes the margins. We see a continued double-digit decline in the Powered Garden business portfolio unit, really weighing on the Gardena Division during the second quarter.

Moving over to Construction, a positive 5% sales growth attributable to all business portfolio units and attributable to all geographies. So growth across the board in Construction. So very, very pleased to see that and very pleased to see the rebound in the Construction Division. Particularly happy in that the most profitable BPU is swing in drilling, where we saw good improvements, particularly in power cutters, strong growth in Q2. Also, a very clear strategic area for this group is our aftermarket development.

And in the Construction Division, we actually had a record aftermarket quarter in Construction. So the initiatives we implemented and we talked about during the strategy launch are really starting to come through. And I'm very, very pleased to see the development in the sawing and drilling business portfolio unit as well as aftermarket in the Construction Division.

Tariff refunds, relatively speaking, very, very high into the Construction Division. That was some SEK 99 million. And the Construction Division is somewhat more heavily impacted by the inflationary pressures that are impacting raw materials and logistics. The timing of that is impacting construction much earlier than the other 2 divisions.

At the same time, from a relative perspective, a much higher exposure to the U.S. and therefore, a high impact from FX hitting the Construction Division. One final point to call out, of course, we announced the intention to exit the stone diamond tool business during the remainder of 2027. That continues to have a dilutive effect on to the margins of the Construction Division. That is our 80 basis points that we see hitting the Q2 result. As we expect to continue and finalize this exit during the remainder of 2027, and then it will become EBIT margin accretive to this division.

At that, I would like to pass across to Terry.

Thank you, Glen. Good morning, everybody, from my side as well. The Q2 EBIT margin improved by some 20 basis points to 13.6%, delivering an EBIT of SEK 1,950 million. There's a couple of big items in there, which we should walk through just to get a better understanding of how we've landed at the SEK 1,950 million.

Starting from the left, you see a big red block, and that is some negative SEK 660 million. Just to give a little bit more detail on what's behind that, approximately half of that is volume impact. We have lower sales in the quarter, and we have under absorption in the manufacturing sites. So there's a volume impact, approximately half of the SEK 660 million. In addition to that, we have unfavorable mix from a product perspective, but also from a geographical perspective.

As Glen referred to earlier, North America has grown and Europe has declined. And from a profit perspective, that's an unfavorable mix. We were more profitable in Europe than we are in North America. And then finally, we have some inflationary pressures, the cost inflationary pressures, particularly around raw materials, logistics and of course, some other costs as well.

Maybe just to highlight, the Middle East inflationary pressures have started to kick in during quarter 2, and we have some SEK 65 million, SEK 70 million estimated inflationary pressures in quarter 2 as a direct consequence of the Middle East conflict. Cost savings program. We continue in a very good way with our cost savings program, SEK 385 million in the quarter. There's a couple of areas that we really seem to be doing very well in, and that is in sourcing and design to value.

There are other areas and pockets of cost savings as well, of course, but those are the 2 main drivers behind the SEK 385 million. So good progress there. A modest price increase of some SEK 45 million in the quarter 2 and some limited transformational investments. We remain quite cautious. It's highly uncertain times, and we were quite limited on some of our investments in that area.

We had a currency headwind of some negative SEK 60 million, driven really by the Chinese yuan and the USD. So a negative SEK 60 million there in the quarter. And then we had the positive tariff refund. We actually had a small tariff cost in the quarter, and then we received SEK 240 million tariff refund. That's physical cash received back in the bank, and we have recognized that into our COGS, which has improved our EBIT and our EBIT margin. So the quarter, as I said, lands at 13.6% margin.

So moving on to the year-to-date, a little bit of a mirror image on the left-hand side, we've improved our operating margin by some 90 basis points to 12.9%, SEK 3.7 billion of EBIT, just shy of SEK 3.7 billion. So taking it from the left to the right, as I've just talked about previously, negative volume impact in quarter 2 is really what is carried into the year-to-date perspective. We didn't have so much of a negative in quarter 1.

So those themes that I talked around in the quarter 2 bridge really are the ones that are applying here. We have the negative volume. We have the negative mix. North America grew in Q1 and Q2 compared to Europe, slightly declined. And then, of course, the inflationary pressures, which I've referred to.

I did talk about the Middle East. And directionally, we said some SEK 65 million to SEK 70 million in Q2. Just to give you a feel for how we see that for the year, we believe the inflationary increases as a direct result of the Middle East will be some SEK 300 million to SEK 350 million full year, of which we've already taken some SEK 65 million to SEK 70 million in Q2. Cost savings year-to-date, very well progressing, SEK 630 million year-to-date. Again, just to give you a feel of how we see this for the year, with our ambition to accelerate our cost-out program to SEK 3 billion over the next 3 years, we believe we will directionally land at SEK 1 billion of cost savings during 2026.

Modest price increases. It's a very challenging market out there. There will perhaps be some smaller price increases to reflect the Middle East inflationary pressures. But at the moment, we have a modest price of SEK 95 million. continue to limit our transformational initiatives, some SEK 80 million year-to-date, and that will remain on that kind of run rate for the rest of the year.

Currency. We have SEK 90 million negative currency headwind so far in the year-to-date. Again, just to give you a little bit of an outlook for the rest of the year. We expect relatively flat currency during Q3 and a small positive in Q4. But overall, for the year, we will still have a negative currency impact in the business.

Tariffs. We have, as I said earlier, received the SEK 240 million tariff refund. We have incurred additional tariffs of SEK 95 million year-over-year. So we have a net effect of positive of SEK 145 million. As Glen said earlier, we incurred those tariff costs during quarter 1 of this year and also last year as they started to kick in. So those tariff refunds are recognized in our COGS.

Again, just to give you a little bit of an outlook, our tariff refund claim is slightly higher than the SEK 240 million we have received. However, the majority has been received now. So with regards to tariffs, we don't expect significant changes for the rest of the year. We may get some further refund, but it's highly uncertain, and we have to wait and see.

So that brings us to the 12.9% margin. Particularly pleased about cash flow in the quarter. Cash is extremely important to this business. We continue to stay focused in this area, and we delivered a positive free operating cash flow of some SEK 3.9 billion in the year -- sorry, in the quarter and SEK 2.8 billion year-to-date. And really, the main factors driving the positive development into quarter 2 was the reduced CapEx levels and the improvement in the change in the net working capital from Q1 to Q2. So very good development there.

Return on capital employed is one of our key financial metrics, and we have improved our performance, moving to 7.4% ROCE compared to 7% same time last year. We continue with the ambition of reducing our capital employed, becoming a more asset-light organization, and we start to see some of the benefits of that coming through here. So again, an improved situation.

Our balance sheet remains very solid. I think we can be quite satisfied with the position of our balance sheet. There's always a couple of things we can do better. But overall, we have a solid financial position, and we have a solid cash flow performance. So I think that is something to be feeling good about.

Maybe a couple of things to call out on the balance sheet in particular. Inventories are a little bit high. Of course, that's a consequence of the weaker sales demand during Q2. Currency adjusted, we are 4% higher in our inventory than the same time last year, and we will continue to work on our inventory levels during Q3 and Q4 to manage those down in a good way.

Maybe the second item to point out is the borrowings. We have been able -- with that good positive cash flow, we've been able to reduce our borrowings by more than SEK 1 billion, as you can see here, down to SEK 1.1 billion. So that's a good development.

Finally, just following on from lowering our borrowings, our net debt position has now reduced, and we are some SEK 11.8 billion of net debt compared to SEK 12.3 billion same time last year. And also what is good to see our net debt-to-EBITDA ratio is now down to 2.0 compared to 2.3 same time last year. So we continue to work on our net debt, and we continue to do the right thing here on our balance sheet.

Maturity profile is healthy. I think you can see in the chart there, that's in good shape. We did renew a SEK 2 billion bilateral RCF by a further 5 years recently, and we were able to amortize a SEK 500 million bond just last month in June. So again, all good activities helping with our debt position and debt profile. And finally, just to mention, our S&P credit rating remains at BBB- with a stable outlook. So we feel in a good position there.

With that, Glen, I pass it back to you.

Thank you, Terry. Just to wrap up then before we go to Q&A. Again, a very strong start to the year in terms of sell-in and very well-received product launches from our channel partners. Follow that, of course, was a weakened consumer demand and some unfavorable weather conditions that really weighed on the overall demand in the second quarter, particularly the first half of the second quarter.

Despite that, we saw a good growth in North America, and that is a continuation. So we're very happy with that. Putting it in the context of the quarter, of course, lower volumes do have an impact on to the margin. However, we continue to execute on our cost-out program at a higher pace than we actually initially envisaged, and we need to do that in order to offset the currency headwinds and the -- particularly the raw material headwinds that we're seeing.

Great to see the cash development, as Terry just presented, really coming through from a little bit of a weaker Q1 as a result of higher receivables, but really coming through into Q2. So a very, very solid cash position that we're very, very happy with. But most importantly, our strategic execution, we're very, very much on track. I want to leave you with that message.

We took some very firm decisions on cost out during the second quarter, supplier consolidation around logistics, closing down warehouses, moving manufacturing and being very, very clear on our strategic portfolio management. We will continue to do this, and we'll continue reporting back as we take these decisions, but very much on track with what we said from our strategic plan and journey.

At that, I pass over to Emelie.

Thank you, Glen, and thank you, Terry. So now it's time to start the Q&A session. And as always, you can ask your questions on the conference call, and you can also write them in the web interface. So with that, operator, please go ahead.

[Operator Instructions] The first question is from the line of Fredrik Ivarsson with ABG.

First, maybe on the gross margin. When we strip out the tariff refund from COGS, it seems like it's down 3 percentage points on the gross level. And then you're obviously quite helpful with all the pieces. But if you could give us some more granularity on the different pieces to the bridge, it will be helpful.

I guess, raw mats, logistics, you call out the geographical mix and some FX. But yes, if you could give us some more help with the building blocks.

Yes. I mean, as I explained in the EBIT bridge, of course, we had a significant negative impact through volume mix and inflationary pressures. And all of those really impacted the COGS and the margin. So as I said, approximately half of the SEK 660 million was impacted through the volume and underabsorption that we had. So that's really impacted there. All of the inflationary pressures that we've incurred are more or less into the COGS side of things, the raw materials and some of the logistics. So that has really also driven it down.

And then finally, the mix. As I said earlier, there is a mix impact here as well. Europe as a region is a more profitable business to us than North America. Of course, it's great to see North America growing, and we will continue to drive that growth. But as -- from a group perspective, of course, it's different into divisions and different segments. But directionally, the mix of the geographical is unfavorable for us with North America growth, Europe down.

And then, of course, the product mix as well. Categories such like water and having a negative decline impacts the margin as well. So there's a lot of moving parts that sit within that. But hopefully, that at least gives a little bit more transparency.

Yes, absolutely. Very clear. And then jumping to robotics and more specifically maybe on the Husqvarna branded robotics. You grew double digit in Q1, good contribution, I suppose, from the 300 and 400 series. And now it sounds like a small decline in Q2.

First, maybe if you have a view on the sellout levels. And second, if you have any sort of granularity to give us in terms of the inventory levels in the trade at the moment, if you have one?

Yes, I can take that, Fredrik. So firstly, we actually saw a growth in Q2 in Husqvarna-branded robotics. It wasn't at the level of Q1, but we did see a growth in Husqvarna-branded robotics. So I think that's important to see. And therefore, we see a good growth through the first, albeit single-digit growth through the first half year.

The sellout is reasonable, very well received on the new product launches, particularly the 300 series is very well received by customers, and we see a good sellout of that SKU in particular, really accounting for a big part of our sales now. When I look at the inventory in the trade, I would say there's a couple of standouts. It's much higher in -- or it's higher in Germany. It's higher in the U.S. and the rest of Europe, I would say it is normalized. So there's really a couple of markets that are standing out, U.S., in particular, and Germany, where it's higher. But the rest of the markets, I would say, are pretty much normalized inventory levels.

Okay. Good. Then maybe a nitty-gritty one. But on the SEK 300 million to SEK 350 million headwind from the Middle East inflation, just to clarify, that's raw mats and logistics, right?

Yes, predominantly, yes.

2/3 raw mats, 1/3 logistics roughly, Fredrik.

Right. And I believe you guided after Q1 for SEK 200 million raw mats. So yes, that didn't really change despite the recent fluctuations? Or am I sort of missing?

No, you're correct. We previously guided on SEK 300 million, SEK 200 million raw mats, SEK 100 million logistics, and we're saying SEK 300 million to SEK 350 million. So it's pretty much the same and pretty much the same split between the 2 areas.

Okay. Good. And last one, maybe a quick one for me before I jump back. On the strength in balance sheet in terms of net financials on a sort of annualized basis, what's a good level for modeling going forward?

I would say where we are now is probably going to be appropriate. I don't see us fluctuating too much from where we are now. I would like to say this is pretty much about right. So I would model on the recent development.

Next question, please.

[Operator Instructions] The next question is from the line of Tubic Igor with DNB.

Yes, I just wonder in terms of the tariffs, given that they are split in different phases, is the tariffs that you recognized this quarter, is that for Phase 1 and Phase 2 or what's included in that, so to say?

I think we've actually been quite transparent with what numbers we have already disclosed. I think the way to look at it is our overall tariff claim is larger than what we have received. However, it's very much uncertain. There's a lot of moving parts. There's a lot of backwards and forwards with the U.S. government on these claims, et cetera. We have received the majority of the claim. And I think it's really uncertain as to what more will come.

So I wouldn't factor in too much more of a tariff refund. I think what we've got is good. I mean it's basically half of the tariff that we've incurred over the last 12 months. We've incurred some SEK 470 million of tariff cost pressure, and we've managed to refund approximately half of that at SEK 240 million. So I would work along that. There's not that much more to come. There may be something, but it's highly uncertain and the tariff situation changes. Yesterday, there was talk around Section 301 for Brazil, 25% tariff starting. So again, it's highly uncertain. We navigate as we go.

Okay. And can I just ask you a little bit more -- it's a broader question, of course, but what is your strategy in terms of pricing going forward? I mean, I assume that it is, of course, hard to increase prices. But yes, can you relate anything to historically how it has developed and how long it usually takes for you to push forward prices, et cetera?

Yes. Historically, we would put annual price increases through. But of course, in the recent years, that's changed given how many headwinds we've been facing during the COVID times, the supply chain crisis and then, of course, tariffs more recently. So we'll be much more, I would say, frequent with price increases.

This year, we're now implementing another price increase, some was effective in June. We'll put some more price increases through in other markets in July as a result of some of those raw material headwinds. So we will aim to put price increases through. And I expect over time, we still have a positive net improvement from by way of price.

At the same time, we've got to stay relevant and competitive. So that's always the balancing point here that we stay relevant and competitive and how much premium we can take. But as a market leader, I do expect price increases.

Thank you, Igor. So we have one question from the webcast. It's from Stefan Stjernholm, Handelsbanken. So how is profitability for Husqvarna Automower developing in H1, up, down or flat year-on-year?

Yes, I can take that. There is not a big movement. It is not up, Stefan, that is for sure. It's a very EBIT margin accretive segment for us, as you know. And of course, we continue to look at this. It is slightly down as a result of some price adjustments we made for this year.

We adjusted price on average 5% on some of the older SKUs, some of the newer SKUs, not so much. Some of the new technology, of course, adds cost pressure into some of the units that we need to continue working with. But I would say slightly down, Stefan, overall through the first half of 2026.

Maybe just to add to that, Glen, that's also where we can focus on driving some cost out as well with the raw materials and such like as well. So whilst the price comes down, we also look to address our cost structure of robotics.

Yes. Very valid. We see more savings potential in that area maybe than the rest of the core range.

Thank you. So operator, do we have any further questions?

There are no further audio questions.

So with that, then I'll hand over to you for some final -- for the closing.

No, thank you. And first and foremost, the gentleman to my left, I want to say a big thank you to. This is Terry's last quarter. I've worked together for some 16.5 years. So a big thank you to Terry, been a great support to this group and to me personally. So thank you.

But just as a final closing comments, we continue to deliver and execute on our strategy. Aftermarket is going to be fundamental. We've seen good growth so far this year, particularly in the Construction division. We're working aggressively on the cost out. And as such, we increased our ambitions around the timing of that, and we want SEK 3 billion fully effective 2028. And we continue to take bold decisions and clear decisions when it comes to our portfolio. So really executing on the strategy.

With that, I want to wish you all a fantastic summer and look forward to seeing you in Q3. Thank you.

Thank you.

Good morning, everyone, and welcome to the presentation of the first quarter results 2026 for Husqvarna Group. My name is Emelie Alm, and I'm joined here today by our CEO, Glen Instone; and our CFO, Terry Burke.

So Glen and Terry will walk you through the presentation, and then we will have a Q&A session. [Operator Instructions]

So with that, I would like to hand over to you, Glen.

Thank you, Emelie, and a warm welcome from my side. So let's jump straight into the presentation.

Q1, to summarize, off to a very solid start despite, of course, the continued uncertain market sentiment that we see out there, particularly around geopolitical tensions. We've seen a strong growth in our core portfolio, our key strategic growth areas. We're very pleased that our EBIT has expanded with some 10% given the strong product mix, but also a very good start to our savings program.

From a strategic execution perspective, we've got a very good 2026 ahead of us in terms of product launches, and Q1 has started very well when it comes to our product launches ahead of the season. We made a very good start around the strategic portfolio management that we launched back in December, and we'll come back to that later in the presentation.

So all in all, 2% organic sales growth, EBIT expansion to just over SEK 1.7 billion and a 12.3% operating margin.

So to highlight some of the strategic areas during the quarter. Innovation. We're very, very proud, and I'm really happy to really talk about our innovation that we're bringing to the market in season '26. All 3 divisions are contributing here. Very happy to see the strong range of residential robotic lawnmowers that are coming for the small and midsized gardens, our 300 Series range, really moving the needle towards boundary wire-free AI vision technology. We also have an enhanced range of 400 Series product under the NERA brand, NERA range that also continues to expand and enhance our vision offering.

Likewise, in the Gardena division, a strong range of watering products that really enhanced the first quarter result with the simply classic range of nozzles and sprayers as well as a strong range of watering controls. In Construction, we've actually brought a good new range of floor saw blades to the market that really enhances our sawing and drilling business portfolio unit. So that's just a flavor of what we brought during the first quarter. So a strong innovation pipeline already coming through in the first quarter.

From a portfolio management perspective, when we launched this in December, we continue to enhance our operating model. This is where we will look much more strategically at our portfolio, grow in certain areas and, where we are not performing as well as we should be, we clearly need to turn it around or, in some cases, exit that portfolio. What I am pleased to see is we already see early signs of this coming through, and we see that in the results.

We've enhanced a lot of our leaders. We've changed some leaders during the first quarter of this year to really drive those business portfolio units. So the operating model starts to get traction.

Operational excellence. I'm really pleased that we got off to a good start when it comes to our savings program. We launched a SEK 4 billion cost-out program, and we've made a good start with some SEK 245 million in the first quarter, really coming through from some savings we found in sourcing and actually simplifying design, really, really supported by a strong complexity reduction already during the first quarter. So all in all, off to a good start.

If we look at the sales development. Then as reported, our sales was minus 5%. That is actually including a currency headwind of minus 7%. So organically, we grew with 2%. We've seen organic growth in the Husqvarna Forest & Garden division with 3%, growth in the Construction division with 1% and a 1% organic sales decline in Gardena. As mentioned, very strong growth in our key portfolio areas, particularly around robotics, watering and handheld products.

What I am pleased to say is actually we've seen a growth in all of our regions so far in quarter 1. So we're very pleased to see that. It's been some time since we've reported a strong growth or growth across all of the regions.

Just to remind you what we launched back in December around the business portfolio units. We'll come back to this time and time again. We have clear segments that we're operating in what we call profitable growth. You see there are 5 key business portfolio units. Really pleased to actually say 4 of the 5 have shown growth actually during the first quarter of 2026.

In the middle of the page, we have 3 which we are in increased profitability, where we really expect to grow in line with the market. In the profitable growth segment, we expect we can grow actually beyond the market.

On the left-hand side is the turnaround segments where actually we've seen a continued challenge during the first quarter in all 3 of those areas. We'll come back -- and I'm very pleased actually with the plans we have in place around all of the areas, but particularly around the turnaround business portfolio units. And we'll come back to you in due course and report on them.

From an earnings perspective, Terry will take us through the bridge later in the presentation. But as mentioned, we managed to expand the operating income to just over SEK 1.7 billion from SEK 1.56 billion in the prior year, resulting in a 12.3% operating margin corresponding to 10.6% last year. And really, this is a volume increase, a price increase, improved product mix, but also the result of strong cost savings.

We did, however, have a currency headwind as well as a tariff headwind that culminated to some SEK 115 million and, again, Terry will take us through more of the details later in the presentation.

Going into the divisional performance. If we look at Husqvarna Forest & Garden first. We saw a 3% organic sales growth, growth in all regions, which we're very pleased to see and growth in our key segments: key segments of robotic lawnmowers and key segments of handhelds. Both residential robotic lawnmowers grew as well as the professional robotic lawnmowers. So very pleased to see.

So from an earnings perspective, of course, we got an improvement from the volume and improvement from the mix, but also, of course, a contribution from the cost-out program. There was a slight positive tailwind from FX impacting the Forest & Garden division, which, of course, also improved the margin.

From a Gardena perspective, the top line organically declined with 1%. However, I would say it is fairly polarized. And by that, I mean we saw a strong growth in the strategically important watering business portfolio unit and a continued decline in the Powered Garden area. So strong, strong growth in watering, as I said, and we're very pleased to see that.

However, the challenge remains around the Powered Garden business portfolio unit, and we'll continue to define and refine that turnaround plan, and we'll come back in due course. But I'm very pleased with the plans that the team have in place to turn around this BPU.

So despite the tough top line, actually, the division managed to improve the earnings, which we're very pleased to see. So we actually saw a 10% expansion in the EBIT, really driven by strong product mix because of the watering growth and a continued strong development around the savings program, negative impact from lower volumes, negative impact from tariffs and also a slight negative impact from FX of some SEK 13 million.

Moving over to Husqvarna Construction division. We actually saw a growth of 1% organically. Actually, we saw a growth in the North America region and a softer European situation. However, strong growth when it comes to sawing and drilling, one of the profitable growth areas within the portfolio, and also growth when it comes to surface preparation as well as a strong aftermarket development in the quarter. However, a continued negative when it comes to the Compaction Placement and Demolition part of the portfolio, again, in the left-hand side of that previous page I showed you.

Construction is actually more exposed to FX, and we saw a negative headwind of some SEK 43 million because of the heavy presence in North America but also actually a negative headwind by way of tariffs and raw materials. So despite those headwinds, we still managed SEK 110 million in operating income in the quarter for Construction. So all in all, we're very pleased with the divisional performance.

At that, Terry, I pass over to you.

Thank you, Glen, and good morning from my side to everybody.

The Q1 EBIT bridge: 2% organic sales growth and a 10% EBIT growth moving to a 12.3% margin. If I walk you through the bridge, starting from the left going over to the right.

We had a positive volume impact in the quarter. As we talked about, we had organic sales growth and we also had favorable mix. The favorable mix was really coming from robotics growth, handheld growth and watering growth. Those were the main drivers for the positive mix. However, this was partly offset by inflationary cost pressures that we've incurred during the first quarter.

Moving on to the next bucket, cost savings. We've delivered SEK 245 million of cost savings during Q1, and we feel very pleased about that. We have guided roughly SEK 800 million for the year. We still hold to that SEK 800 million. We were able to take, let's call it, perhaps some of the lower-hanging fruit early in the year. So that feels good that we're able to address that, and we continue to drive our cost saving program. As Glen mentioned earlier, cost savings predominantly coming through from sourcing and design to value.

Moving on to price. We had a small positive price. This is a net price improvement in the quarter. We did have price decline in the robotics. And of course, the other categories had a positive price development, ending up with a small net positive in price.

Transformational initiatives is something, of course, we want to continue to invest in. These are our strategic areas. And we invested some SEK 50 million during quarter 1.

Currency, we had quite a significant currency headwind last year. This has now slowed down. We only have a negative SEK 30 million in quarter 1. So that was good to see that, that's starting to play out. Just to give you some feel for how we see currency for the rest of the year, we expect another negative quarter in quarter 2 and then a slightly positive in the second half of the year. So for the full year, we expect a negative currency of some SEK 60 million to SEK 100 million negative, depending, of course, how it plays out.

Tariffs in quarter 1 was a gross negative SEK 85 million. Our previous predictions, previous tariff rates, we talked about some SEK 200 million to SEK 250 million gross headwind for this year. We now see that being around a negative SEK 150 million, so a slightly improved situation from the tariffs. So negative SEK 85 million, and the rest of that SEK 150 million negative direction will come during Q2.

So with that, we landed just above SEK 1.7 billion of EBIT, 12.3% margin.

Cash flow. Maybe the first thing to point out is we have changed the way we report cash flow, just to make people aware that now, going forward, we will talk about free operating cash flow. Previously, we reported on direct operating cash flow.

What you can see in the quarter was a negative SEK 1.1 billion. And really, this is impacted by timing, and the real movement was the change in net working capital. There's two elements to that. One is we currently stand with higher accounts receivable at the end of Q1, and that was really driven by a stronger sales development in the second half of Q1, which meant we ended the quarter with higher accounts receivable.

The second one was we had lower trade payables. And I would say we are more normalized on our trade payables levels now. Last year was slightly inflated. So a more normalized situation there. But there are timing issues for both of them, and worth pointing out, quarter 1 is traditionally a negative cash flow quarter.

Return on capital employed, one of our new financial targets and metrics that we launched in the Capital Markets Day in December. We've improved our return on capital employed to 7.6% from a 6.5% same time last year. So it's good to see how we've started to see an improved situation here.

That's really driven by a couple of factors. First of all, we have an improved operating income. And secondly, we are seeing lower capital employed, which you can see on the chart in front of you, around SEK 3.5 billion on average lower capital employed over the last 12 months. And that's really driven by we've lowered our borrowings. We've had a couple of good years of cash flow, we've been able to lower our borrowings, and that has had a positive effect. So good development on the return on capital employed.

Balance sheet. We continue with a solid balance sheet and a good financial position. Maybe a couple of things to call out here. Inventory, we are some SEK 900 million higher. If you adjust for currency, it's actually just above SEK 1 billion higher inventory. And we would say we are ready for the season to start. Quarter 1 is a sell-in season. Quarter 2 is really, we talk about, where the music plays and the sellout when the season starts. So we have good season readiness. We have good inventory around us. So we're ready to go for the season.

Trade payables, I did already cover that in the cash flow part. But just again to highlight, we have higher trade receivables. It's a timing effect due to the stronger sales development in the second half of Q1. Borrowings, we've lowered by some SEK 1.5 billion compared to March '25, as you can see. And trade payables, as I mentioned earlier, some SEK 1 billion lower, and that's really again a normalized situation this year compared to slightly above normal last year timing effects.

So moving on to our debt position. Our net debt/EBITDA ratio is now at 2.0 compared to 2.5 this time last year. So again, we're driving this in the right way. We lower our borrowings. Our net debt position is SEK 13.8 billion, which is pretty flat to previous year, which was around SEK 13.7 billion at that time. So a good progress on our net debt/EBITDA.

Our debt maturity profile, I would say, is healthy, as you can see in the bottom chart here. And we also successfully refinanced a new 5-year bond of some SEK 1.1 billion during February 2026. We remain investment grade, BBB- with a stable outlook.

With that, Glen, I pass back to you.

Thank you, Terry. And just to wrap up the quarter 1 presentation. So as said, a solid start to the season despite the uncertainty we see in the world. Organic sales growth of some 2%, growth in 2 divisions and a slight decline in one. A good expansion of our operating income, some 10% expansion driven from volume improvement, a stronger mix and a good start to the savings program. From a strategic perspective, just zooming out, good product launches, a great innovation pipeline. We're making good progress with the strategic portfolio management.

So I'm very, very pleased with the start of the year. Good savings, good innovation and operating model starts to get momentum.

So with that, Emelie, I think I'll pass back to you.

Super. Thank you, Glen, and thank you, Terry. So with that, we would like to open up the Q&A session.

And I will actually start with one question from the webcast, and it's from Adela Dashian from Jefferies. And I mean, we updated the tariff guidance already so you have this scenario in there already. But how do you see the April change to the Section 232 impacting our tariffs?

Yes. And that is all included in the communication that I gave you. We think we see a roughly exposure of SEK 150 million gross tariff impact for the year. As I said, SEK 85 million is already taken in Q1. So there's a little bit more to come. But I think the important thing is, of course, mostly mitigated through price increases.

Thank you. And operator, do we have any questions on the conference call?

[Operator Instructions] We have a question from Fredrik Ivarsson, ABB.

Maybe first question on demand. We've seen consumer confidence coming down quite significantly, at least in some countries. Can you say anything about how consumers have reacted initially? I know it's early in the season, but any signs from that in terms of consumer behavior?

Fredrik, I think it's fairly early to say. Of course, as we mentioned, Q1 is our sell-in quarter, really preparing for the season. And now we're hoping that Q2 is, we often say, where the music plays, where the demand really happens. So I think it's a little bit early to say, but we're very, very happy with our sell-in and very, very happy with our strong product launches. But too early to say around the consumer demand at this point.

Okay. Fair enough. And then a follow-up on the amendment of the 232 tariff. So you lowered the tariff guidance a little bit. Is that due to the amendment of Section 232?

It's all factors considered. Of course, there's been quite some changes. So I think it's a lot of moving parts. But ultimately, it's everything that we know of today and, of course, it can change. But everything that we know of today is all baked into those numbers that we communicate now.

Okay. But should we assess that under this new sort of tariff structure, you actually expect lower tariffs?

Yes, yes.

Okay. Okay. Good. And then on the current raw material cost inflation, can you say anything about what you're expecting in terms of input cost inflation and where you potentially could expect that to hit your P&L in terms of timing?

Yes. If we look at this, of course, what's going on in the world right now, particularly the Strait of Hormuz impact, we're seeing that would impact us across two areas, raw materials and logistics. We think full year impact this year would be around SEK 300 million as we know today, if it continues through the remainder of the year. That will be SEK 100 million secreting to logistics and SEK 200 million relating to raw materials.

And really, the main raw materials that are impacted are plastics, aluminum and steel. And they take account of about 60% of our raw materials, and they are three main raw materials that are exposed. But we would see again around SEK 200 million from raw materials in the remainder of the year given what we know today. But just to highlight though, of course, mitigated by price. We will pass that price on. Yes, that's the gross impact.

Very clear. And last one maybe. And potentially I missed this, the line broke up a little bit, but did you say anything about the growth in robotics?

We did. So we had a strong growth in robotics actually, particularly if I look at this in the three areas, we should say. Strong growth in professional robotics under the Husqvarna brand, strong growth in residential Husqvarna robotics as well. And we actually saw a decline in the Gardena-branded robotics, but overall, a growth in robotic lawnmowers.

The next question is from Bjorn Enarson, Danske Bank.

Talking a little bit about the good development in Q1 and what that is telling you. I mean, are we basically saying that the expectation are kind of downbeat and this is kind of a normalization? Or do you believe that retailers and dealers are turning more positive on the season, betting on the staycation kind of environment, if you understand that?

Yes. There's probably a part of that in there, Bjorn. I think the big thing is during your Q1, it's very much preparing for the season. Strong portfolio, strong innovation, so a strong sell-in in preparation for the season. That's how we're seeing this. Anything to add, Terry?

I think we can only control, of course, what we can control and we feel in a good position going into the season. Of course, it's highly uncertain how things are playing out. But there is an argument for a positive staycation effect, but there is also a counterargument of weak consumer sentiment, holding their money given the highly uncertain times and cost of living increases. So it's very, very difficult for us to judge and have an opinion. But we're ready for the season to start.

But given that Q1 developed well, I mean, that must say something about sentiment among dealers, although they're coming from low level, if you understand what I mean.

Yes. That's absolutely valid, Bjorn. We do see maybe a positivity from our channel partners that are willing to take in the inventory. And of course, they've selected Husqvarna Group as their supplier. So that is a positivity. And again, well prepared for the season with what we have in the channels.

Yes. And second question, I mean, you're talking a bit about the inventory situation that you are well prepared but, also again, that it's very uncertain given where the world is here and now. How should we think about that, I mean, if it's not developing along the lines of your expectation? Are we in a difficult situation? Or how should we look upon this level of inventories?

So I think you look at inventory in sort of two lenses here. One, of course, is our inventory that we hold in preparation for the season. And as Terry mentioned, this is slightly higher in preparation for Q2, and we feel well prepared. And then, of course, is the inventory with our trade partners as well that we monitor. And again, we seem to be on a somewhat normalized level overall with our trade partners, 1 or 2 high levels on some segments.

But we're keeping a very, very close eye on the inventory levels both, of course, with our trade partners and also making sure we address our own internal inventory levels.

Okay. And then maybe a quick one on the Gardena robotics. You talked about it was a decline. Was this a little bit of an intentional decline? Or I mean, are you losing share due to that you don't want to participate full out? Or is it a mix within the mix situation, where low end of the low-end robotics are perhaps growing better, et cetera?

No, we did expect a decline this year. It's a double-digit decline for robotics. We knew that from the listing situation. We knew that from the competitive landscape. So it was very much in line with what we thought going into the year.

At the same time, the new product launches we've had under the Gardena brand in robotics, particularly the Gardena SILENO sense, that's been well received. So we've got some positivity within the general decline for Gardena robotic lawnmowers, but in line with our expectations for Q1.

Next question is from Alexander Siljestrom, Pareto Securities.

A couple of questions from me. Starting off with the cost savings program that came through there in Q1. Obviously, very impressive. Do you expect sort of the same rate here in Q2? And also if you could talk about the sort of full year guide on the run rate.

Yes. First of all, I absolutely agree. We feel pleased with quarter 1, how that has developed, and SEK 245 million is a good number for quarter 1. As I did say, perhaps we picked up on a little bit of the low-hanging fruit during that first quarter. So that was also important.

We are working hard. We are driving cost out of this organization. We were very clear on that at the Capital Markets Day. We have a big target and we are working hard towards that target. We hold at the SEK 800 million for now. Again, we are working hard towards it. So we'll have to see how that plays out. But for now, we still stay with the SEK 800 million as the guidance for the year.

Okay. Cool. And anything for Q2? Should we expect sort of SEK 200 million then there given the target or SEK 250 million? Or is it too early to say?

It's too early to say. But I mean, directionally, I'm thinking it's going to be around the same, SEK 200 million, SEK 250 million.

Yes. Cool. And then maybe just on the growth in the robotics segment. You mentioned that Gardena was down double digits. Could you talk about the growth for sort of the non-Gardena robotics, so residential Husqvarna and professional? Was that in the sort of double digits or high single digits? Or any color there?

So if we look at the Husqvarna robotics, we did have a double-digit growth very much across two different segments, professional and residential, and very much in line with the guidance we provided at Capital Markets Day. So we're pleased with the start for Husqvarna. Very strong innovation pipeline, great product launches in Q1, and we feel we're very well prepared and we're really taking the shift as we move over to boundary wire-free and different vision technology.

Cool. And maybe just a final one on North America. Impressive that you're back to growth there as well. Could you talk about sort of the main product segment drivers that you saw there and also maybe the impact from the storms?

Yes. So I think it's a valid point you raised on storms. We actually saw a good growth in handheld products in North America, which is good to see. Actually, a decline with wheeled. We saw a growth in the whole construction assortment in the quarter as well in North America, and we also saw a growth in watering under the Orbit brand in the Gardena division in the quarter. So growth in construction, growth in handheld products and growth in watering products in the U.S.

Next question is from Johan Eliason, SB1.

Yes. I guess this was me. It's Johan Eliason from SB1. Can you hear me?

Yes, Johan.

So I was just wondering a little bit about the robotics, coming back to that. You mentioned strong growth for the professional and the Husqvarna-branded residential. How would you say the margins for you are developing on those products and categories in a year-over-year perspective? Are you holding up the margins on that part of the robotics business, improving or declining? And any indications there would be helpful.

By and large, Johan, we are holding up margins with the Husqvarna-branded robotics, very much in line with our business plans. So holding up the margins, to answer, yes.

Good. And on the Gardena where you see the decline, is there a mix? So you said that the new introductions are at least doing well there. Is that allowing you for a sort of a positive margin mix so you can hold it there as well? Or how should we think about the margin year-over-year on those products? I remember you did have some price cuts a year ago maybe and then still some sellout. So maybe that is also helping that part of your robotics offering more.

Yes. We mentioned price in the presentation. And the negative price on robotics, it really came from the Gardena assortment, particularly the older technology. Whereas the newer technology, the new launch I mentioned, that held up. So we see more positive margin from the new products and a negative margin from the older products. But all in all, margin has moved down for the Gardena robotics assortment.

And maybe just to be clear. The Gardena robotic is margin decretive both to the division and to the group.

Okay. Okay. Good to know. Then if we look at the consumer segment now when you are transitioning to the wire-free solution. The total cost for the consumer, including with the old solution, wires and then maybe having some external help to install it vis-a-vis buying the wire-free solution today, is that a bigger total ticket for the consumer on the Husqvarna-branded side? Or is it lower? Or it's basically the same?

It's basically the same. Actually, Johan, we see very comparable prices year-on-year in the marketplace if we -- say, for 1,000 square meter machine, we see very comparable prices. Of course, it's higher technology and, hence, we need to take cost out of the system to maintain those margins. And that's exactly what we're doing.

Thank you. Before we go on with the conference call, we can maybe have a follow-up. It's from Stefan Stjernholm regarding the inventory level at resellers. So if you can elaborate a bit on the regions and so on.

Yes. Stefan, so if we look at the inventory in the trade, which I understand your question is, we actually we see it normalized in Gardena, per se, with the exception of watering, and it's slightly higher given we've had a strong Q1 sell-in. So that's where it actually stands out as being slightly higher. I say that's applicable globally.

If we go to Husqvarna Forest & Garden division, handheld is normalized globally. We have wheeled normal in Europe, normal to slightly higher in North America. And robotics is normal to slightly higher globally as well, again, with a very, very strong sell-in in Q1 in preparation for the Q2 season.

And Construction, I would say across the board is normalized. There is still a reluctance to take on too much inventory from our construction partners. That has been the case for the past couple of years given the uncertain times we're living in. So I would say a normalized situation within Construction.

We have a follow-up question from Fredrik Ivarsson, ABG.

A short follow-up on the cash flow and the timing impact. Should we expect that to sort of fully reverse in Q2?

Yes, Fredrik. As I said during that slide, it's really a timing issue. And of course, having a stronger second half to quarter 1 from a sales perspective meant that the accounts receivable landed higher at the end of the quarter. It's purely a timing impact, and that will flush through during Q2. So yes, I would say it will all get corrected just as the timing flows through.

We're happy to have higher accounts receivable, Fredrik. Good indication of strong sales.

Thank you. And with that, operator, I don't think we have any further questions. Or do we?

There are no more questions from the phone.

Okay. And we've been through all the questions on my iPad here. So with that, would you like to wrap up a little bit?

Absolutely. So again, thank you for joining our quarter 1 report. Off to a solid start. This is a journey we're on and it's a long transformation journey, but again, good to get a strong Q1 behind us. We are executing on our strategic areas, very strong portfolio management, good cost savings and a very strong innovation pipeline.

So at that, we wrap up. Thank you.

Yes. Thank you. Thank you for listening.

Thank you.

Good morning, everyone, and welcome to the presentation of the Q4 and full year results for Husqvarna Group. My name is Emelie Alm, and I am joined here today by our CEO, Glen Instone; and also our CFO, Terry Burke.

Glen and Terry will walk you through the presentation. And as always, we will finish with the Q&A session. You can ask your questions online in the web interface, and you can also ask them through the conference call. But just before we start with the presentation, we announced some management changes today.

So Glen, would you like to comment?

Absolutely. First of all, good morning to all. We did announce some management changes today. So first and foremost, I'd like to welcome Yvette Henshall-Bell, who will take over as the Head of the Forest & Garden Division. That's been with us some 3 years and has been leading our European business within Forest & Garden, actually recording record sales in 2025 within that business area. So were the successor to myself in that case. So really pleased to welcome Yvette to the team.

At the same time, both Terry and Karin will leave the company during the course of 2026. We've got a transition period to work through, and that's what we're working towards. So very confident in the strategy we have and the team we have in place to do that. But Terry, please say a word.

Thank you, Glen. Yes, just very briefly, after 16 years with the group, it was a difficult decision, but I have decided to take a new challenge to take some time out and to do something different. But it's very much business as usual for the next 2 quarters. I'll be here up until the end of quarter 2, business as usual, and we continue to execute on our new strategy.

Good. So let's move on and look at -- first and foremost, let's look at 2025. If we look at 2025, of course, it has been an extremely mixed year with a lot of mixed demand. Ultimately, we actually delivered an organic sales growth of 1%. There's been certainly a change in consumer sentiment as we've gone through the year. We've seen a soft or a softening of the consumer sentiment, particularly impacting North America, slightly more positive in Europe, but still a softening of that consumer sentiment that we saw in Q3, and it continues into Q4.

As I mentioned, we've had a mixed demand. We've seen some signs of positivity. We've had growth in robotic lawnmower. We've had growth in power caters growth in watering. So some of our key areas we've seen growth in, but we've also seen some declines in other segments. We had headwinds during the year by way of FX. That was a negative, and Terry will take you through the numbers, but also tariffs.

Tariffs, of course, came in during the course of Q2 and continued to impact us during the remainder of the year. In most cases, we managed to offset a large proportion of that, but we didn't fully offset the tariff headwinds. We launched some cost savings programs in recent years and the most recent one in 2022. We're actually going to bring that to a conclusion, and Terry will talk about the cost savings, but we actually had a very, very strong cost savings program impacting us positively in 2025, some SEK 745 million during the course of 2025.

We maintain a solid financial position as well. We managed to reduce our net debt during the course of 2025 that we're extremely pleased with. And therefore, we've increased our net debt-to-EBITDA ratio. Again, we'll come back to that later in the presentation. As such, the Board are actually proposing to increase the dividend to SEK 1.25 from SEK 1. And of course, that will be ratified at the AGM in April.

Going into 2030, shifting gears forward, of course, we are now changing the strategy and looking ahead. We launched at the recent Capital Markets Day some new cost efficiency measures. And when we talk about cost efficiency, it's a significant program, some SEK 4 billion in cost savings. Most of this should be delivered or 60% of that should be delivered in the midterm, i.e., during the next 2 to 3 years. And we'll give some more guidance on how we see that in 2026 later in the presentation. We also talked about a much more improved performance management.

In the Capital Markets Day, we launched the term BPU, and that is business portfolio units and how we relook at the units and how they perform. And we give a very clear signal of how some are performing more structurally and going to be part of a structural growth, how some are going to be more in a profit improvement and how some are going to be in a turnaround mode. What I do want to be clear is that we've got to be very, very clear on time line here. Where we have a turnaround, we talk about a 24-month turnaround, either robust turnaround or we need to make some firm decisions on those segments.

What I'm extremely proud about is our continued innovation. In 2025, we brought a lot of new products to market, and we continue doing that into season '26. I'll actually close today's presentation and give you a sneak peek in some of those product launches, we've got an extremely strong product lineup going into season '26.

So just to recap on what we said at the Capital Markets Day in terms of the financial targets. We said we would -- we have ambitions to grow 3% to 5% when it comes to net sales. Those targets are applicable immediately. That is our clear target going into season '26 and beyond. We must get this company back to growth. Operating margin, we said we have an operating margin above 10%. The first step is to get to 10%, and that is when we talk about a near to midterm target, so the next 2- to 3-year time horizon. And then from a return on capital employed, that is very much in the 2030 time horizon. So just to frame the 3 financial targets we said and when they're applicable in terms of time.

Looking back at Q4, of course, this is our seasonally smallest quarter, and we actually had a sales decline of 3%. When we get such sales declines in a small quarter, of course, it impacts from a volume perspective through to the bottom line. We certainly saw a mixed demand, as I mentioned, across the full year was equally applicable to the fourth quarter.

Continued soft consumer sentiment, particularly in the North America space. However, we did see some growth in certain segments, actually in the professional segments, particularly around power cutters, of course, benefiting the Construction Division and also professional robotic lawnmowers. At the same time, despite having lower consumer sentiment, we saw some growth in watering in Europe and wheel products in Europe. So still some positive signs despite it being a seasonally small quarter for us.

As said in the intro when I introduced Yvette into the group management team, actually Husqvarna Forest & Garden Division in Europe performed very, very well with record sales. So a big positivity in the European business area for Husqvarna Division. So just concluding the fourth quarter, lower volumes, some 3% lower in top line impacting the volumes, headwinds from tariffs and headwinds from currency, lower on the currency, but actually slightly higher impact on the tariffs than we've seen in the previous quarters. And of course, that does give a headwind to the EBIT. But all in all, our seasonally smallest quarter.

So if we look at this from the usual slide we've been showing in recent periods, net sales, as I said, declined with some 3% when we FX adjust. We actually had a sales decline in 2 of the divisions in the Forest & Garden Division as well as Gardena Division, Forest & Garden declining with some 3% and Gardena declining by 10%. But we're very pleased to see the growth in the Construction Division.

Very tough first half of 2025, and we started to see some growth coming into the second half year. And that's what we saw in the Construction Division, particularly in the North America space. So a 2% growth, but the growth actually coming from our North America construction business. I think I mentioned the challenging market conditions there in North America really relating to the residential, the consumer segments.

From an operating income, we had minus SEK 841 million. This is a figure we are not proud about. This is a loss-making quarter, but of course, it is lower than we would have liked it to be. Lower volumes, as I said, negative headwind and negative impact from currency and FX and tariff, but we did manage to continue delivering on our cost savings programs. Terry will take this in the bridges, but we had some SEK 180 million of positive effect coming from the savings programs in the fourth quarter.

Operating cash flow, we are seasonal, and therefore, in Q4, it is our season preparation quarter. So we start to build up inventory ahead of the season, and that is very much the case. So we had a negative cash flow impacting our fourth quarter of some SEK 1.3 billion. However, at the same time, we managed to reduce our net debt, and we'll come back to that later in the presentation.

Robotic lawnmowers, we've had a lot of questions, and it's a big, big focus area and one of the core business portfolio units for this group going forward. We actually managed to grow 11% with robotic lawnmowers in 2025. Strong growth in professional robotic lawnmowers, but also growth in our residential offering, particularly in the premium end of the segment. So we're very, very happy with that. Since during the fourth quarter, we managed to actually have 2 fairly breakthrough announcements.

One is we will be the title sponsors of the Husqvarna British Masters for golf, again, getting us much closer to the golf business, where we feel we get a fantastic awareness creation and boost the awareness and also a very good halo effect into the more residential spaces. We also entered into a partnership with a company called Relox Robotics. And this is actually where we get distribution rights for Europe for ball picking. So again, raising the awareness of Husqvarna in the golf business that we feel is going to serve us extremely well going forward. Precision grass care and precision grass coating, which Husqvarna is now really standing for.

If we go into the divisions, and I've given a bit of a flavor in the intro. But the Husqvarna Division, again, a seasonally small quarter, declined with some 3% organically in the fourth quarter. FX had an impact of some minus 8%. So reported figures at minus 11% there.

Challenging in North America from a consumer sentiment perspective had a knock-on effect into the demand. And also some of our channel partners also reported on actually very low storm levels in North America in the fourth quarter, and that was the case, and that has a knock-on effect for the demand for our chainsaw products. So they were very key aspects in North America.

When we look at Europe, actually, we actually saw growth in several residential segments and particularly in wheel products, but also in Pro robotics. So even though it's a seasonally small quarter and certainly for grass cutting, we managed to see growth in both Professional Robotics as well as our wheeled assortment.

The income, just like for the group, negatively impacted from FX as well as tariffs and lower volumes. So all in all, we managed to come in with some minus SEK 355 million. Zooming out to the full year, actually very pleased that the Husqvarna Forest & Garden Division showed a growth -- organic sales growth of 3% and an operating margin of some 7.8%. Strong growth in Europe with much more pressure sitting in our North America business area.

Moving over to Gardena Division. Again, putting this in context, it is the seasonally small quarter. And in the fourth quarter, we actually had a decline of some 10% from an organic sales perspective. The main declines came from 2 areas: the electric products that we call our Powered Garden segment, but also the watering business in North America under our Orbit brand, largely the result of weak consumer sentiment.

We did, however, see growth in the watering business in Europe. That is the business portfolio unit that we put into the strategic or structural growth segment at the Capital Markets Day recently. So very pleased to see the growth in the watering segment in Europe even in a small quarter. So given that, we managed to keep EBIT more or less flat to last year, slight improvement to some minus SEK 376 million, so fairly flat despite the lower volumes.

On a full year basis, the division declined with 3% organically and managed to have an operating margin of some 6.4% Again, growth in watering with some pressure in the Orbit business in U.S. as well as the Powered Garden, the electric assortment globally. So very much the same comments I say, Q4 are applicable to the full year.

Construction, very pleased, as I said in my intro, to say that we've had a growth in the Construction Division in the fourth quarter. Very tough H1 given the North America situation and the cyclical point, but we managed to see a recovery during the second half of the year, and that continued into Q4. So we actually had an organic sales growth of 2%.

Strong growth in power caters, which is a very key area and a big part of our sawing and drilling business portfolio unit and also actually strong growth on aftermarket sales in the fourth quarter. That's been a continuation within the Construction Division. Operating income did decline as a result of FX and tariffs. Construction Division is the most exposed to FX given its stronghold in North America as well as the tariffs, but we managed to offset a large part of that.

And as such, when we look at the full year basis, we're very, very pleased actually that we managed to maintain our absolute EBIT and actually improve the operating margin to some 8.9% despite the headwinds from FX and tariffs. So very, very strong cost-out programs and price mitigation activities.

At that, Terry, I pass to you.

Thank you, Glen. As Glen described, a difficult quarter 4 for us. It is a small quarter and a loss-making quarter. Our margins moved from 8.2% margin in Q4 '24 to a negative 11.3% margin in quarter 4 this year.

Just walking you through the bridge from left to right. We have a negative volume and mix impact. We've talked about the organic sales having a negative development in the quarter. And of course, that volume has impacted our EBIT. In addition to that, maybe also worth pointing out handheld, which is quite relevant in this quarter. Handheld was relatively weak in the quarter, which had a negative mix impact.

And really, the reason for the handheld, there was a lack of -- shortage of storms in North America, in particular. And normally, with the storm comes the sale of chain stores, et cetera. But it's been quite calm in quarter 4. So that had a little bit of a negative impact on the mix.

Good cost savings. We continued with our previously communicated programs and delivered SEK 180 million savings. And we managed to deliver a low single-digit price increase in the quarter, some SEK 60 million. We continue in a modest way with our transformational initiatives of some SEK 35 million. Currency headwind was a SEK 35 million in quarter 4, again, a continued strengthening of the Swedish crown against the U.S. dollar. So that has had a negative impact. And the tariffs approximately SEK 150 million negative in quarter 4. That takes us to the negative 11.3% margin in the quarter.

Year-to-date, we have a slight margin decline in the full year, moving from a 6.6% margin to a 6.2% margin. And again, just walking you through the bridge from the left to the right. We actually had a pretty flat impact from the volume and the mix. We actually had a slight positive effect from a mix, but there were some costs that offset inflationary costs, et cetera, that offset that. So pretty flat from a volume and mix impact perspective full year.

Cost savings program, SEK 745 million in cost savings achieved during the year. So that has contributed in a very positive way to our result during the year. Price, negative SEK 215 million, in the year. And that was really driven by the robotics price erosion. First of all, we had the boundary wired robotic that we were aggressively selling out and selling through. And there has been -- in the residential part of the robotics, there has been a margin erosion, price erosion, which we see here in the price reduction.

Modest transformational initiatives of some SEK 115 million investments. Currency in the year, SEK 315 million negative and tariffs, which was around 8 months of the year because it only started in May, June time, that impacted with some gross SEK 375 million. All in all, that took us to a 6.2% margin full year 2025. We now want to close our previously communicated cost reduction programs that we communicated during 2022 to 2024.

We have delivered approximately SEK 2 billion of savings in those cost-out programs, and we have reduced approximately 1,700 positions within the company during that time as well. So we feel quite satisfied about how we have performed on this cost-out program. But now we need to turn our attention to our newly communicated cost efficiency program up to 2030, which I'll come on to now.

So at Capital Markets Day, we announced a SEK 4 billion cost-out ambition fully realized in 2030. This is about addressing sustainable cost reductions and improved operational efficiency. Now we want to try to drive a lot of that SEK 4 billion as early and as soon as possible. So we aim to get the majority of those savings in the short to midterm. What that means for 2026 is we expect some SEK 800 million of cost-out savings to be delivered in 2026.

Maybe just to call out that during the course of 2026, the majority of the SEK 800 million will come in the second half of the year. We will get savings in the first half, but the majority in the second half as we really execute on our actions and our plans to deliver those savings.

Just to remind everybody, items affecting comparability, SEK 1.5 billion is needed to support the SEK 4 billion of cost out. SEK 1 billion of that is cash impacted, SEK 0.5 billion noncash impacted. And for 2026, there will be approximately SEK 0.5 billion of nonrecurring costs incurred as part of this SEK 1.5 billion. So maybe one other thing to point out here as well is the 20% complexity reduction, which is a key enabler. We are focused. We will reduce our product range, and we will aim to take complexity out of our business. So that is a key enabler and will help us to deliver on some of these savings.

Going back to our balance sheet. We have a very solid balance sheet and a solid financial position. A couple of things maybe to call out on the balance sheet for this quarter. Our inventory levels are now more or less flat with last year, but we did significantly ramp up inventory in the last quarter, some SEK 1.8 billion of inventory was increased during quarter 4 in readiness for the new season. So we feel like we have good inventory around us, and we are ready for the 2026 season to start.

Maybe one other thing to call out on this slide, the borrowings. As you can see, we have reduced our borrowings. Our net debt has also come down, and we feel we have done some good work on the cash flow and managed our balance sheet in a good way.

Moving on to the net debt EBITDA. We are now at a 2.1 ratio -- net debt-to-EBITDA ratio compared to 2.5 previously. So we are well within our financial policy. We have reduced our net debt to SEK 11.8 billion compared to SEK 14.5 billion previous year. So I think we've done well in this situation, and we've managed our cash flow in a good way and managed our working capital in a good way to help achieve this.

Finally, on the cash flow. I think I would describe the 2025 cash flow profile as more of a normal cash flow profile year. So we tend to be negative at the start of the year as our accounts receivable build up as we continue to build inventory, et cetera.

And then as we come out of quarter 2 and into quarter 3, we really maximize our cash flow position. And then quarter 4, it's a loss-making quarter. It's an inventory build quarter. We start to drop off a little bit in quarter 4. So I would say a solid cash flow year, SEK 3.3 billion and a normalized cash flow profile in the year.

Glen, with that.

Thank you, Terry. So on sustainability, first and foremost, we're extremely happy with our sustainability efforts. In the fourth quarter, we continued to expand and advance our performance. We improved our emissions, so now reducing emissions from the 2015 baseline by 56%, our CO2 emissions, an improvement of 1% in the quarter. So extremely pleased with that and way above the target we set ourselves a couple of years ago.

Circular, we advanced in the quarter with 4 additional ideas or innovations. So our circular innovation is now at 49%, so more or less on track with the 50% target we had, and particularly targeting recycled materials in product as well as in packaging. So really pleased with what we're doing on the circular side.

On the people side, we set out to empower 5 million people to make the right choices, and we actually improved during the fourth quarter to 5.6 million from 5.5 million. So we've exceeded that target, and we're very pleased with what we've done there. And of course, as we go into 2026, we'll focus much more on the carbon CO2 reduction and our circular offering by way of percentage of net sales, and we'll come back to that.

I mentioned in the intro that we will propose -- or the Board proposed an increase in the dividend to SEK 1.25 from SEK 1 per share. That is based on a payout ratio of some 40% and very much in line with our plans and also the dividend policy to pay out some above 40% of our net income. So very much in line with our policy there, the proposal. So very, very balanced based on what Terry just took us through, a much stronger balance sheet, strong financial position, reduced net debt, and therefore, we feel we can justify increasing the dividend as such. So we're pleased with this proposal.

If I just summarize then the full year, and then we'll look at some of the product launches before opening up for some Q&A. Full year, despite the headwinds, particularly by way of FX and tariffs, we managed to increase our top line with 1%. So despite the headwinds, we still managed an improvement. We do have some weak consumer sentiment, particularly in the North America space, and that continues, of course, during the third quarter and into the fourth quarter, we saw that continuation.

We've had a lot of successful product launches in 2025, and I'll show you on the next slide, a sneak peek into what we've got coming for 2026. Our savings programs, Terry just concluded that. We've had a very successful set of savings programs with some SEK 2 billion delivered in the recent years for the programs that we launched. And now we launched even more aggressive cost-out program for season '26 and beyond. And this is very much needed. We've got to be even more competitive in the marketplace and really free up the funding to invest in our aftermarket and our brands. So we'll continue with that.

As mentioned, extremely solid financial position. We reduced our net debt significantly, as Terry took you through, and we've, therefore, proposed an increased dividend. Just on 2030, very, very strong product lineup, and I'm going to go through. Performance management is going to be key. We're going to give you much more clarity and information around our performing segments and less performing segments where we have less performing segments, we need to have very, very clear plans to improve them.

And of course, the SEK 4 billion cost efficiency program is going to be a prerequisite. I would like to add a minimum before that. It's going to be a minimum SEK 4 billion. We need to actually bring in more savings earlier. That is very much what we are planning to do. So just to give you a flavor on some of the product launches, and I really emphasize the some because it's hard to fit them on one page.

We start off in the robotics area and particularly under the Husqvarna brand, we actually have 7 new models coming for season 2026 under the -- in the residential setting. We have 4 in the 400 series for the larger landowner customers, and we have 3 in the smaller landowner customers using our scalable AI vision. We also have a new model coming in the professional segment that's covering lawn sizes or commercial screen spaces up to 8,000 square meters.

And what we'll also add to the range is actually an accessory that is retrofit -- you can retrofit it to the 2025 500 series robotic lawn mowers, enabling the vision possibility for our mowers. So that's something that we'll offer for season '26. We also have a fantastic range of chainsaws that we're bringing to the market.

We've recently launched a new 60cc petrol chainsaw, which we believe is best-in-class. We also are now adding more and more when it comes to our residential offering as well as our battery offering. We also are now adding more and more when it comes to our residential offering as well as our battery offering. So we actually now have a 50cc battery equivalent chainsaw coming to the market, our 550i XP. So that is very, very powerful battery chainsaw.

In the Gardena assortment, of course, we use the group's strength in robotics, and we also have the Gardena Smart SILENO sense using the AI technology that we have across the group, and that would really target loan sizes from 400 to 800 square meters. We have some very strong offerings when it comes to our watering. We have hose boxes, we have new water tanks, and we also have the AquaPrecise, again, advancing our positions in smart watering.

In the Construction space, and for those who managed to join us at Capital Markets Day, we showed this in action, but we actually take the robotics technology into the floor grinding space, and we have the first self-operated floor grinder under the Husqvarna brand actually in the industry. We're very pleased with this. This is now available for customers to purchase and early signs are extremely positive.

We also expand our battery offering in the construction space. We have our high-powered PACE battery, the 94-volt PACE battery that we have more and more offering from. And we're very pleased actually with some new revolutionary technology that we bring to the diamond cutting space that's really going to help our sawing and drilling technology and offering. So a very, very strong and broad product lineup going into season '26 that is going to serve us extremely well.

With that, Emelie, I think I pass to you.

Thank you, Glen, and thank you, Terry. So with that, we will open up for Q&A. [Operator Instructions] So we will start with a question from the webcast, and it's from Henrik Christiansson at Carnegie.

So could you walk through the main items on the EBIT bridge for 2026 over and above cost saves of SEK 800 million? What about FX, tariffs and price?

Sure. So okay, let's start with the price. We would expect a low single-digit price to come through during 2026. From a robotics perspective, in the residential, there's potentially still a price pressure. However, it's a much more normalized situation compared to what we faced in '25 when we were trying to sell out all the technology and some price adjustments in that area. So overall, a small single-digit price.

When it comes to currency, we had a SEK 315 million negative currency in 2025, and I would expect about half of that in 2026. So somewhere between SEK 100 million to SEK 200 million of negative currency is how it looks at this moment in time.

Tariffs, we've got 4 -- approximately 4 months from a year-over-year perspective to carry over into the first half of this year. And the gross impact of that will be some SEK 200 million to SEK 250 million impact in tariffs. And we would expect at least half of that to be offset with mitigating actions.

Thank you, Terry. So operator, do we have any questions on the conference call?

[Operator Instructions] Our first question comes from Adela Dashian with Jefferies.

So first question, I know it's still early -- very, very early in the season, if you will, for '26, but would it be able to get some sort of understanding of what the weeks in January has given you more visibility? Maybe, I mean, if you could compare it to 1 year ago today, even, that would be some good color if we start there.

Adela, I think it's very early to say. Of course, we're very much in preparation mode, loading up the channel partners in preparation for the season. So I think it's very early to say just 5 weeks into the year. But our ambitions remain, as we set out at the Capital Markets Day that we want to see growth in 2026, and that is absolutely the case.

Maybe just to add on to that. From the inventory in the trade perspective, if we look at Europe, I would say the inventory in the trade is probably around normal to slightly above normal. This is all on a very high level, of course. There's some nuances between categories, but normal to above -- slightly above normal in Europe.

North America, with that weak consumer sentiment that has really carried through all of 2025, I would say the inventory levels are above average in North America going into the '26 season.

Would it be possible, Terry, to actually specify what those nuances are in the different categories?

Well, if we go back to Europe, if we talk about watering, I would say watering is normalized. Water and hand tools, they are pretty much normalized. Residential robotics is slightly above average in the inventory in the trade. Wheel, I would say, is pretty normalized as well. If that helps put a little bit of flavor on it. And the higher inventory in North America is pretty much across the board.

Yes. That makes sense. On the tariff impact, if I may, you said that you expect to be able to cover half of it through price increases. Would it be possible to say anything about the competition at this stage? And if in the past year or so, if there's been any change in your market share?

I'll take this one. I think it's -- we don't like to comment on competition necessarily, but price increases, we managed to pass on. We've done that during the course of last year, of course, later in the season, and therefore, we get the benefit into season '26. Hence, we give that sort of guidance of covering about half of the tariff exposure. We've got to stay competitive in the marketplace as well. But I don't like to comment on what competitors are doing in that respect.

And I think it's different -- it's very different between divisions as well. The competition, some have a very local competition. And because we have such a broad range, it differs even within the division. So there are areas where there's local competition, which obviously aren't impacted by the tariffs.

And then there are some parts that are European manufacturers. But even some of the European manufacturers have manufacturing in the U.S. So it's a very complicated picture. And as Glen says, we don't really focus too much on the competition. It's what we can influence ourselves internally.

[Operator Instructions] We have no more registrations over the phone.

Okay. Let's go for a question from the webcast again. Could you please elaborate on your inventory position? How much of this still relates to products that you are currently phasing out?

I think it's -- first and foremost, we're in season preparation mode. We said that a couple of times today. So Q4, as Terry said, a normalized profile is to start building inventory. So our elevated inventory in the fourth quarter was according to plan. But we have been selling through obsolete inventory in old models, and that's continued to be the case. So I would say we're at a much, much lower level when it comes to our obsolete inventory, much lower than we were closing Q3.

Yes, nothing really much more to add. I think we're in a much better position now with the older technology than we were in 2025, as you say, Glen. So I think we've dealt with that issue. It's more normalized and overall good healthy inventory.

Thank you. Can we get the next question from the conference call, please?

The next question comes from Bj�rn Enarson rn Enarson with Danske Bank.

You said you will mitigate half of the tariffs and it was assumed that, that is through price. Is that correct? Is it primarily price that will offset this? Or are there any other actions in place to compensate tariffs?

Bj�rn, it is predominantly price and it's actually price that we already managed to pass on during the second half of next year that will carry over into 2026. So it is predominantly price. But in some cases, we look at supply mitigation activities as well. But the lion's share is price increases.

And on -- for Europe then, are there similar target for you to also see some net price hikes for the year?

I think as Terry said, our price guidance for the year is minimal given how fluid the market is. But as a market leader, I expect we can always take some price, but it will be minimal single digit this year, as Terry said.

Thank you, Bj�rn. We have another question in the webcast from Alexander Siljestr�m, Pareto. Can you quantify the step-up in marketing investments in 2026, considering the British Masters title partnership and your ambition to increase marketing spend by 1 to 2 percentage points of sales?

Yes. It's a very good question, a very positive question. So we will increase our marketing efforts, as Terry mentioned at the Capital Markets Day, we want to increase from 3% to 5%, so 1 to 2 percentage points increase. That will be, I would call it, marginal during the course of 2026. We want to start proving ourselves with the cost-out program to really fund that investment.

So there will be a marginal increase, but I would say our total strategic investments or transformational investments are more around the SEK 100 million, SEK 150 million mark across the full year.

Thank you. And in the Q4 EBIT bridge, what was driving the negative SEK 170 million in volume mix and other?

Yes. As I touched upon during that slide, of course, we have a negative volume in the quarter. Our organic sales was 3% down. Then you have a slight positive price. So if you put that into it, it's 4% down negative volume in that sense. So that has had an impact, and that is the majority of the SEK 170 million.

Also, as I mentioned, handheld has been a weaker quarter than normal, which would have a negative mix impact. And that's really due to the lack of storms in North America, where usually there are storms and immediately after that, chain saws are sold out. It was quite calm in quarter 4. So that had an impact on our handheld business.

And maybe the attached P&A that goes with that handheld goes hand-in-hand with that. So that was lower as well in the fourth quarter.

Thank you. And do you include an improvement in consumer sentiment in the U.S. to the back -- to achieve positive organic growth for 2026?

Given that we have 2 of our 3 divisions working very much in the consumer space, orbit a consumer or Gardena or it in the consumer space, Forest & Garden around 2/3 in the consumer space, then, of course, we were -- we are -- we have hopes and ambitions that there's a consumer sentiment uplift. But at the same time, we need to take market share despite how the consumer sentiment is. So that's very much what we plan to do.

On the professional side of the business, both Forest & Garden as well as Construction, then we do see the positive signs or some more positive signs than the consumer market. So all in all, that's how we see it.

Thank you. And given new entrants offering wire-free vision-based navigation at aggressive price points, how is Husqvarna defending its market share in the North American residential markets?

Yes. It's still fairly small in North America residential market in robotic lawnmowers. The awareness is still fairly small. We need to keep building that also a big reason for the brand-building activities. So whilst it's still small, we've got to make sure we continue the market leadership position.

We do have some great offers. We came in season 2025 with a particular North America offering, much higher wheels for different grass cutting, different grass types, I should say. And we'll continue to have that offering for North America. What is being successful in North America, the early awareness is actually in the professional space. And the reason I start to mix up professional residential there is that the halo effect from the professional into the consumer residential space is very apparent, particularly in golf.

So we're very, very pleased with, if you like, what we have today, and we have a strong product pipeline for '26 and particularly into '27, that's going to support the North America space.

Thank you. And how large share of sales is robotics and battery now for the full year?

22%, that is now the share. So previously, it was 20%. So we've moved the needle yet again in a very positive way, and we now become 22% of our total sales is through robotic and battery. So again, continued very positive journey there.

Thank you. So operator, do we have any further questions on the conference call?

There are no more questions.

Okay. All right. So with that, let's conclude the Q&A session and today's call. And thank you very much for watching, and we are looking forward to seeing you at our upcoming road shows. Thank you.

Good morning. Welcome to Husqvarna Group's Capital Markets Day 2025. Thank you all for joining us here in Stockholm today. And thank you for watching us online. My name is Emelie Alm, and I am Head of Investor Relations. Our aim today is to increase the transparency level and also the understanding of the company. And we will also share a clear road map to our transformation to profitable growth.

We have a full schedule today. And first, you will hear our CEO, Glen Instone, and also our CFO, Terry Burke. This will be followed by a Q&A session. And after that, we will head upstairs for our product exhibition. This product exhibition will mean a 1-hour break for those, who are watching online. After this, at 11:00, we will have our strategic deep dives with our divisional Presidents followed by a Q&A session. And after that, we will have a lunch to go and you will also be able to revisit the product exhibition if you are attending in Stockholm.

So with that, I would like to invite our CEO, Glen Instone, to the stage.

Good morning.

Good morning. So Glen, you've been the CEO now for the company for a couple of months. Could you please share your first reflections?

Absolutely. So I think we come from a strong foundation. That's what we should say. We've been innovating our products for many centuries actually. And we've been investing in our brands. We've also been over delivering on our sustainability targets. .

And of course, that's good. That's the very positive things. I believe we'll be changing the organization to really get closer to our end customers. So we've reorganized over the recent years. But the obvious elephant in the room is we've been underperforming on our financial targets, and that's what we've got to be very clear on.

So we are underperforming. We have not been taking sufficient cost out of this organization. We haven't been competitive enough. That means we haven't been investing sufficiently in innovation and in our brands. So whilst we've done a lot of innovation and brand investments, we need to do more.

And we also have quite a new management team in place to execute on this strategy.

We do, and I'm really pleased that at least 6 of my 7 colleagues are here in the room today. And before I introduce the management team, we -- leadership is going to be key in this next phase. We're going to have to do a lot of change. The culture in the organization has got to change and got to be much faster. So execution and focus is something which we're going to speak a lot about during the course of the day. .

So the new management team and some are actually less than 12 months with the company. But Terry Burke will be on stage soon, CFO, who I think many of you know. And then we have the 3 divisional presidents. We have Maha, Gardena, Omar Attar Forest & Garden; and Karin has on Construction. So all you'll get to meet today. And then we also have Sophie, our General Counsel and Robert, our CIO. The only one missing today is Maria, who is on our company trip in the U.S. But the other 6 colleagues, you'll get time to mingle with them.

All right. Thank you for that intro. Glen, With that, I will hand over the stage for your presentation.

Thank you. So again, a warm welcome both those in the room but also those who are following online. So really pleased to stand here today and talk about our next phase for this amazing group, this amazing company. But it will be a miss of me not to talk about our existing environment where we're operating in.

Of course, it is a challenging environment that we operate in today, and that is not new to anybody. The geopolitical tensions bring uncertainties and that affects the consumer buying power on the consumer sentiment. And that is a reality we have.

Competition has changed in recent years. I think some 5 years or so ago, we started to see more of the powerhand tool players coming particularly into the battery space. And in more recent years, we've seen a lot more Chinese competition coming into the robotic space.

But that is our competitive landscape. I mentioned geopolitical tensions causing some uncertainty. But of course, the knock-on effect of that is that we've had a lot of tariffs and tariffs are something which we've been talking about now for a few years. And I guess they're here to stay. So that's the environment we have, but also FX.

FX is, of course, it swings both positive and negative, and certainly during the course of 2025, had been a negative impact to the Husqvarna Group. And of course, post the previous Capital Markets Day, we came into a very large period of uncertainty on supply chain disruptions, and that continues to play a part and continues to be the environment that we operate in.

Now as such, we have been underperforming. Again, I mentioned this a few minutes ago, we have underperformed ourself financial targets. And today, I want to really give you some hope and credibility about our path forward to achieving the financial targets we set and the ambitions that we have.

Emelie mentioned something once you kicked off to say we want to be much more transparent. And we go to market, and we have 3 autonomous divisions. Husqvarna Forest & Garden, Husqvarna Construction and Gardena. That is the 3 divisions, and they are our 3 reporting units, all autonomous P&Ls.

That has enabled to get much closer to the different end customer groups that those 3 divisions operate with. However, what we would like to show now actually below the 3 divisions, how we govern this organization, how we govern this organization even more robustly going forward and that is by what we would call business portfolio units.

Of course, given our underperforming margin performance right now, then all of our business portfolio units are not green, I guess you're not surprised about that. Within the Forest & Garden space, we have 4 business portfolio units, residential robotics, which we'll discuss a lot today. Professional robotics, a fairly new segment of ours. We only actually entered this market in 2019. Core handheld, which is really part of the heritage and what we bring forward for many, many decades and last but not least, our core wheel.

The latter segment, the latter business portfolio unit where we have the most headwinds and the most challenges. What each of the divisional presidents will do is actually de dive on each one of these and actually what we're going to do. So whilst I will talk about what the divisional presidents will go much more into the how and what we're going to do to address these areas.

Gardena likewise has 4 business portfolio units, watering, where we have a clear #1 position, hand tools where we also have a clear #1 position and both performing very well. And then we have what we call our powered garden, anything electric in the garden under the Gardena brand would be what we class as powered garden, including the Gardena branded robotic mowers, and they're actually what we would class as a turnaround case. And Maha will come back exactly what we're going to do to turn this around.

And last but not least, by way of acquisition back in late '21, early '22, we acquired Orbit. This actually made us the #1 residential player in irrigation in the U.S. So was a strategic bet that we took, and we actually have some profitability uplift to make within the Orbit business portfolio unit.

Sorry for the BPU, but it's very long to say business portfolio unit all day. So 3 BPUs. One is sowing and drilling, where we have a clear #1 position. but also it is profitable, EBIT margin accretive to the group. Then we have what we would call surface preparation, also a #1 position, but with some profitability improvement targets and uplift.

And last but not least, compaction, concrete placement and demolition, actually quite a broad segment where we have a #4 when it comes to compation and placement of our #2 position in demolition. So some profitability uplift and turnaround required there. So we're going to take you through each of these business portfolio units and what we're going to do to really improve the margins going forward.

In a slightly different view, that is how it looks. And that is, therefore, the circles are bubbles there being the Forest & Garden division, the Turquoise ones, Gardena and the gray ones Husqvarna Construction. So all playing either in a profitable growth where we want to get above GDP growth. These are clearly markets that we feel we can have growth beyond GDP.

Very structural increases, we feel are possible. So on the profitable growth, we will drive even more focused and really drive our capital allocation towards those areas. In the middle section, which we call profitability, increased profitability is where we have a strong market position, #1 or #2, but we need to really work with our cost out and improve the profitability to really double down on our #1 or #2 positions.

And on the left-hand side of the page is our clear turnaround cases. Just so happens as one per division. And it's very, very important that we turn these around. And just to be clear, if we execute on the turn actions and it is not sufficient, then of course, we will look at all end of actions, and that could mean we'll exit some segments.

But right now, our focus is around turning around these areas. Orbit is a business we acquired in late 2021 and is the U.S. irrigation brand that we acquired. So as I mentioned, we have a strong foundation that we need to continue building on. And for those who are who know Husqvarna Group, this is going to be very repetitive to you. For the ones who are fairly new to the case, I'm going to give a very quick recap of the Husqvarna Group is.

We are a global leader in the outdoor power equipment space. We're also a global leader in the light construction industry. So we come from a very strong starting position in terms of the industries we operate in. We have 2 extremely strong brands, Husqvarna brand and the Gardena brand, 2 extremely strong brands, and we'll talk more about that as we go through the course of the morning.

As I mentioned in my introduction, innovation is going to be key going forward. We must continue to innovate, continue being the technology leader. We've been doing this now for 3 centuries and need to continue doing so as we take this next phase. Quality is everything to us. We must have the premium quality. By having premium quality, we become the trusted partner of our trade partners and our customers.

And what we also have very, very strong is a very strong global reach. We have over 100,000 point of sale globally, where you can get our products and services. And that is a big, big asset to this company, and I'll come back to that later.

Just geographically speaking, about 60% of our sales are in Europe, about 25% of our sales are in North America, leaving around 15% of our sales in what we call Rest of World. So moving over to our existing jump-off point. I mentioned that we want to have a #1 or #2 position. That is a market position.

I'm very proud to say, actually, we have 80% of our sales today in #1 or #2 positions. So we come from a position of strength. We need to continue capitalizing on that. Very clear examples is robotic. We are global #1. Watering and smart watering systems, again, we are global #1 in both the Gardena and the Orbit brand. And in several of the light construction segments were also a global #1.

Global #2, when it comes to professional handheld. I mentioned the importance of brands. We will continue investing in our brands. That's going to be very, very important to us. In fact, we'll go as far as saying we've been underinvesting in recent years. So we want to actually increase the investments in our brands.

This is where we really connect with our end customers, particularly the consumer customers that we have. Our 2 core brands are Husqvarna and Gardena. Innovation. Innovation is what's been driving this company, as I said, for all 3 centuries. We started off and the page logo of course, is a gun sight. We started off making guns for the military, moving into applications like saw machines, bicycles, motorcycles, an order cycle into a chain saw, there's a lot of similarities. It's a 2-stroke engine, driving the drivetrain there and redriving this bucket and the bar and the chain.

So a lot of similarities. And that brought us in 1959 to actually bringing the chain saw in the marketplace and then developing into becoming the outdoor leader in outdoor power equipment. What you will get to see today actually in the breakout, we have a product acquisition area, where we're going to showcase our next level of innovation. The next level of innovation is on the bottom right of the page here. Firstly, we have our AI-enabled vision robotic mowers.

This we believe, is breakthrough for Season 2026. This will be available both for the residential users and our higher premium products, but also for our professional users, really making a difference to our customers. What we also have is the auto grinder. It is a big machine. So you're not going to get to see it and touch it in person, but you'll see it on the screen.

This is a self-operating flow grounder again, market-leading breakthrough technology, really satisfying and serving a fantastic purpose towards our end users. So some great innovation coming through. And as I said, we must continue fueling the innovation pipeline. This is absolutely critical to this group.

That's going to be a big part of what we talk about as we go through the day, investments in brand, as I mentioned, but also investments in R&D. And Terry will actually take you through some of those numbers later in the presentation. So we talked about transparency. We talked about the business portfolio units earlier in the presentation.

And now we're really trying to just look at this in a more product category perspective. 40% of our sales are to professional users, people who are using our products for a working purpose. Not maybe like you and I who are more residential users, and that is 60% of our business, both very, very important.

What we do want to do with this next phase of the strategy is to increase the weighting towards professional users. And the reason for that is pretty obvious. We believe there's more customer stickiness. We believe there's more parts and accessories possibility, and therefore, we get more recurring revenues.

So we do want to overweight the growth towards professional products. But that does not undermine or underestimate the importance of our residential products where we have market-leading positions. Some 23% of our product assortment is handheld. And handheld, of course, means a lot to many, many people. It is where Husqvarna started for many, many people, and it continues to be a very strategic important area to us.

Both from a combustion engine technology perspective, but also battery technology. We will be present with the applications that the customer wants, be it in combustion engine technology or battery technology. Wheeled represents around 18% of our business. It is actually a turnaround case. Much stronger in Europe, stronger profitability, I mean, by that, much weaker in North America. That is a turnaround case representing some 18% of our revenues.

Robotics, we've been talking about this in each of our quarterly reports, now representing 16% of our business. so close to SEK 8 billion from a category we created in 1995. Watering, which happens to be about 60% of the Gardena business, I say, very, very strong global leader, #1 position.

Like Construction, #1 or #2 position in most of our categories there, representing roughly 15% of our business. And last but not least, might deem a fairly small part, but hand tools, where we play with the Gardena brand, and we have a global #1 position, very, very strong in Europe, in particular.

Underpinning all of this is aftermarket solutions. And this is something which we're going to talk a lot about today, particularly in Husqvarna Forest & Garden, Husqvarna Construction space. The aftermarket to us is going to be a differentiating factor. I mentioned the strong global reach. This is where we can really differentiate versus the competition. We cannot just have a good aftermarket solution. We're going to have travel world-class aftermarket solution.

That enables us to be even closer to the customers, but of course, get those recurring revenues that we talked about. So that represents today around 20% of our business. Of course, it's part of all the product groups, but really on its own is about 20% of the business. I mentioned quality earlier, and quality to us is actually fundamental because poor quality products simply will not wow our customers.

When we bring innovation to the marketplace, we hopefully make a difference to our customers. When we bring a premium quality product to the marketplace, then we really become the trusted supplier and a trusted partner to our customers, and that is what we aim to be.

There's a proof point on the pitch there. We call it Ciara. Ciara, for those who were at the Capital Markets Day 4 years ago is a product we launched. You also see it in the breakout session. It's a fairly big product. And really, this was the first breakthrough product, capable of come up to 75,000 square meters. So really breakthrough in terms of large green spaces. What it actually did is create a big pull from the Golf business. In 2021, we actually said we were targeting sports facilities, sports and facilities. It's 2 areas. But golf became a very, very big pull in the past 4 years.

So the golf industry is really being attracted to what we're offering. And why this is important is over 1,700 courses globally. I feel we are their trusted partner to satisfy their needs each and every day, and we continue to grow this 1,700, quite a rate of knots. Other proof points, 80% of our robotics fleet today is still in use after 9 years. I think that is a great proof point around a performance-driven solution.

This is not a product that lasts 2 or 3 years. 80% of our products are still in use after 9 years on robotic mowers. I mentioned a differentiating point on aftermarket and the way we will satisfy our aftermarket differentiation is by utilizing our strong global network of trade partners. We are present today in over 100 countries. That is truly global market reach, but we also have over 100,000 points of sale. 65,000 points of sale in the retail business, around 25,000 points of sale in the dealer business and about another 10,000 points of sale in the more direct rental account type structure.

That becomes quite different when you look at the sales profile, actually, 60% of our sales today going through the servicing dealers. And the reason I've seen servicing dealers is that will provide a servicing aspect. They all provide the aftermarket support that we need to make the true difference to our end customers, and that is absolutely critical to us going forward.

25% of our business is towards retail channels, the more modern channels. And today, about 10% is direct e-commerce. And for the extremely observant ones in the room, you've quickly added that up and said there's 5% missing. That's correct. That is actually other channels like the rental accounts. So 60% of the business going through our servicing dealers super important when it comes to creating that differentiation by way of aftermarket.

Innovation. I will keep saying innovation numerous times throughout this day and throughout this morning, we must continue being the sustained technology leader. I'm sure many of the words on this page are not so surprising. There is a move from petrol-to-battery products. There is a move towards more autonomous solutions in many, many industries. Digital, AI, all bringing new breakthrough connectivity, if you like, towards the end customers and bring some new breakthrough advantages.

And of course, sustainability and circularity become a very key pot, not just Husqvarna Group, but to this world, and we're going to cover that in more detail. We must continue being the technology leader, which is why the investments in innovation are also important to us.

So we'll talk later in the presentation about the size of those investments, but this is a fundamental to us to succeed. What's going to be important for us to really succeed with innovation is to accept and embrace partnerships even more. partnerships will make us faster, make us faster to market, but faster will actually breakthrough innovation.

So we will embrace partnerships at a much higher pace than we have in the past. That's going to be very, very important. So I now come to really the strategic page that we will start with now, and we will close with later in the morning.

For those who have read the press quickly this morning, we want to transform to profitable growth. That is the clear ambition for Husqvarna Group, and we must transform to profitable growth. Three clear areas to our strategy.

Firstly, operational excellence. And by this, I mean a true transformational cost-out program. Today, we announced a SEK 4 billion cost out program. I'll come back to the details on that. The reason this is so fundamentally important to us, this is the fuel. This is what's going to fuel this company in the coming period.

One, to support the margin element, absolutely needed, but two, to support those investments that I referred to, innovation and brands, investments we must make to keep this growth engine, and we must get back to growth. Just to be very clear, we must get this company back to growth.

We then have a very clear differentiator supported by that strong global reach, our aftermarket. Again, we've got to have world-class best-in-class in our industries when it comes to aftermarket. That is a differentiator. It's actually quite a high barrier to entry.

Our competitors do not have 100,000 point of sale. We do. And that is a strong barrier to entry and something which we must capitalize upon. So aftermarket in Solutions will be a strong, strong differentiating point in the strategy phase.

And last, but certainly not least, the third part of the strategy is that whole transparency topic I mentioned, but it's not just transparency, it's actually what's going to drive our capital allocation. And that means we're going to be much more strategic with our portfolio management, where I talk about that profitable growth segment, the profitability improvement segment and the turnaround segments.

So much, much more focused when it comes to our product portfolios. And that is what will take us towards market leadership. And this is what we believe is a very execution-orientated growth strategy. Supporting those 3 areas that I mentioned, of course, sustainability is really at the heart of what we do. We can make a true difference in this world with our sustainability efforts, and I'm super proud of what we've done to date.

And we'll show our next phase of ambitions as well. Innovation and brand, I think I've talked a lot about, but this, of course, is a fundamental. And last but not least, I mentioned this in the intro with Emelie. We must transform the culture in this company. We need to be faster, we need to be, we should be more agile. And that is going to be key to succeed.

And as such, today, we launched new financial targets. In recent periods, we have not been growing sufficiently. It's been fairly flat our growth. And of course, we don't feel that is sustainable either. We must get this company back to growth. So we set a target of 3% to 5% over a business cycle. And this is applicable immediately. We must get this company to growth immediately.

We have also adjusted our operating margin target. Previously, we started in the peak of COVID. That is what it is, and Terry's going to take you through some of the periodization of our performance. But what we said the financial targets that we feel are credible, and we have a very strong rodent to achieving them. And that is what I really want to bring through with the messaging.

First of all, we need to get to 10%. That's a, and that is in the mid- to near term, we need to get 2%, so near to midterm. And then we need to operate consistently above 10%. That's what's going to be important to us.

Last but certainly not least, we are adjusting our capital efficiency metric. We're going to talk about return on capital employed, very, very important. We want to have a strong balance sheet. We want to really be much more focused with our capital allocation towards the profitable areas, and therefore, get much more return when we look at this.

And therefore, we set a return on capital employed target of some 15% over a business cycle. The cost-out program I referred to, and it's a really transformative cost-out program. Today, we launched what I believe is the biggest cost-out program in Husqvarna Group's history. SEK 4 billion cost-out program. This is needed, needed, as I mentioned, one, to expand our margin, to be more competitive but also to fuel the growth and the innovation need that we have, brands, innovation and really fuel our growth engine.

SEK 4 billion is a minimum, let's call it, over SEK 4 billion. And this is a real prerequisite. Whilst we set a 2030 target for this, which seems quite a long time frame, 60% of this program is going to be achieved in the midterm. And Terry is going to take you through some more timing.

When we look at the SEK 4 billion, there's really 5 key areas: sourcing, which will represent on 35% of this target, sourcing in the smarter way, getting much best cost suppliers. They don't say low-cost suppliers, they're best cost suppliers. It's really net cost reductions we're looking at here.

Design to value working in a smarter way. How do we become more modularized, how do we take out low-performing SKUs? How do we really take out some of the noise in the system to be more -- even more focused that's representing around 20% of this new cost-out program.

Manufacturing efficiency is also very, very important. We want to take out also a further 20%. What's a good example this year in Orangeburg, where we outsource to a contract manufacturer. And more recently, we announced the closure of a handheld component facility here in Sweden, where we can get more efficiencies into the supply chain.

Logistics, very, very important to us. We must use people who do logistics part of the day job. People who are experts at logistics. And therefore, we will be using much, much more third-party logistics support, representing around 15% of this program.

And last, but certainly not least, organizational efficiency. How we actually organize even smarter and more efficient, and that represents around 10% of this program. Truly underpinned by complexity reduction, where we're going to aim to take 20% of our product portfolio out, again, really increasing the focus on the good stuff. That's what we want to do.

A differentiating point I mentioned was aftermarket. And all 3 divisions, but particularly the Forest & Garden and Construction divisions will give some good examples of this. The reason aftermarket is important to us, it is a differentiating point. Also on the graph here, you see it's been fairly sticky despite all of the headwinds we've had in recent years. Our parts and accessories aftermarkets have been growing very nicely. We need to continue this. About SEK 9 billion or 20% of our business today, ambition to grow to over SEK 12 billion in the coming phase.

Super important to us, deeper customer engagement, really leverage that installed network we have and really work with our customers to be even more productive. That's what they need. When we look at the strategic portfolio management, again, to really put things in fewer buckets now to try and show that we have a very clear focus.

We have 1 bucket which is robotics, both residential and professional, high growth potential, structural change in the marketplace beyond GDP growth. That is where we will clearly want to catch that strong market momentum.

Aftermarket, I think I've talked a lot to need to continue with this momentum we've built and continue driving that towards the SEK 12 billion. Number three, these are product groups that are more growth in line. So slightly above GDP growth where we need to capitalize our #1 or #2 positions.

Likewise, in the handheld segment, Again, we will be present, whether that's internal combustion engine technology or battery technology. The customer will decide, but we're going to strengthen our leadership positions in both. And last but not least, wheel basically a turnaround case, we must take drastic cost out of the system, and that will improve profitability.

And by doing this, 2030 looks quite a different company. We've got more sales when it comes to Pro. I mentioned we're going to overweight towards Pro, which means we should have over SEK 25 billion of Pro sales by 2030.

Stronger aftermarket business, but a much stronger mix. And this is going to be very, very important as we take this next phase. So this is the mix we anticipate for this company by 2030. Just doing a deep dive on one particular area, robotics. We will touch robotics a lot in the Forest & Garden presentation and the Gardena presentation, but I want to actually paint the picture of what the robotics market looks like.

In our terms, around 15% of our sales today are professional robotics of SEK 8 billion, just over SEK 1 billion. That is in a market that we believe is going to grow even faster, above 30% market growth potential. The way we serve that market today is through what we call professional dealers. It is not the normal dealers. It is actually the premium servicing dealers. People who have people in the marketplace, selling, servicing on-site support, very, very important.

Then we have the premium residential segment. And this is about 70% of our business today. 70% of our SEK 8 billion roughly SEK 6 billion. That is where we play predominantly with the Husqvarna brand, global #1 position, and we expect market growth of around 15%. Then in the more mid segment where we play with the Gardena brand, that is where we have even more competitive pressure. And that is where we actually only have a #3 or #4 position.

We expect that market to continue growing. Competition is coming in there absolutely. So we see that. We expect this segment to continue growing. But again, I want to put it in a very clear context of where we play and how we go to market. At the lower end of our offering, much more in the residential space, of course, but going to market through retailers and e-commerce.

At the premium end, where it needs more one-to-one, if you like, management really supporting the customer is where we use our dealer network and our premium dealer network in many places.

Sustainability is something, which we believe is a differentiator as well. And we've been doing extremely well with our sustainability efforts. We've reduced our CO2 emissions since 2015 by 55%. Very, very proud of that, actually.

Today, we launched a new financial -- sorry, new sustainability targets as well as the financial targets, and this is to actually improve our CO2 emissions to 60%. And -- so versus a baseline of 2015 improved by 60% by 2030. What I'm also proud about actually is that we've continued to contribute to society by way of circular offerings, how we can actually put more products into life for a second life, how we can have more reuse of material, how we can use more bio-grade material in our products.

And we affected by 2030, some 25% of our sales are coming by way of circular offerings. On the left-hand side of the page, just some proof points. Actually, we've been in the -- the Time Magazine as one of the world's most sustainable companies in 2024 and again this year and a AA rated with the MSCI.

So some clear proof points that we actually are very, very credible when it comes to our sustainability efforts. So before I pass over for a financial deep dive, I just want to then really come back to the summary slide. We have a clear strategy to transform this group to profitable growth. Three fundamental areas: operational excellence, which is our transformative cost-out program, SEK 4 billion, to support the margin, but also to support the investments needed in innovation and brand.

We have a clear differentiator supported by our global reach, which aftermarket, we must have a best-in-class aftermarket. Why -- it drives deeper customer engagement and drive deeper recurring revenues, more recurring revenues. And we will have a much more clear capital allocation model to drive our strategic portfolio going forward. Three clear areas: profitable growth, profitability improvement or turnaround. So a very, very clear segmentation, how we look at our business portfolio units. And this, ladies and gentlemen, will take us towards profitable growth for the Husqvarna Group. Thank you.

Thank you, Glen, for sharing. Next up, I'm pleased to invite our CFO, Terry Burke, to the stage. So please, Terry?

Good morning, everybody. Nice to see you all. Maybe we should start with just having a little bit of a reflection of what has happened over recent years. Actually, a lot has happened over recent years. If we start in around 2018, 2019, we made a conscious decision to dissolve the Consumer Brand division and to consolidate into the 3 divisions we have today. We have the Husqvarna Forest & Garden division, Gardena division, the Construction division. At the same time, we exited around SEK 3.5 billion of consumer branded handheld and wheeled products. .

So already back then, we were starting a transformation. Then we came into 2020. A lot of uncertainty as COVID started to take effect. And then we actually enjoyed a very positive impact from the pandemic. We have the stay-at-home trend. People were outside in their gardens. They were not traveling, they're not going to restaurants. They had disposable income, and they wanted to invest in Garden products.

That was really in '21 was the peak of our positive effect from the pandemic, and we achieved an operating margin of 12.1%. Maybe also worth pointing out at the end of 2021, we acquired Orbit, which is a U.S. irrigation business. And that actually made us the group and that Gardena division the global #1 in residential watering. So that was a big important acquisition for us.

Then we moved into the years of, I would say, a lot of turbulence. If we just reflect on 2022, we had a lot of supply disturbances, particularly in semiconductors, which restricted our ability to manufacture and supply robotic lawnmowers. There were other supply disturbances as well, but that was really the main one.

At the same time, political tensions escalated and of course, we all know the Russia and the Ukraine situation, in particular, had quite an impact. And that impact really carried into '23 and '24 high energy prices, high inflation, high interest rates and a weakening consumer demand, and weaken consumer sentiment.

And that really impacted our business. Maybe also worthwhile to point out at that time around '23, '24, we exited another SEK 1.5 billion of petrol wheeled product in a U.S. specific channel partner. So again, we exited some of our unprofitable business.

Moving into 2025. And in the 9 months that we've had in '25, that continued uncertainty that continued weak sentiment has impacted our business as well. We've had the tariffs. U.S. implementing the tariffs has, of course, created a lot of disturbance with our supply chain and a lot of turmoil in the markets and in particular, a weak U.S. consumer sentiment.

Also impacted was the weakening U.S. dollar. So in those 9 months of 2025, we have had a negative impact from currency and tariffs of more than SEK 500 million. Quarter 4, I'm sure people are thinking, how is quarter 4 shaping up. It is still a heavily uncertain market. We still have weak consumer demand.

We will also still be impacted from currency pressures and tariff pressures in quarter 4. So I think it's important just to set that scene and to be clear. Really today is about looking ahead. It's about looking at the future, the longer term.

Let's hope we get to some kind of more normalized situation and improved consumer sentiment. And our ambition is to get back to profitable growth, and we need to drive cost out to this organization to be cost competitive. And we need to be very targeted in specific actions on our business portfolio units, whether it be a turnaround, whether it be improved profitability or profitable growth.

With that, we believe we can get to growth and an improved margin. As Glen has already shown, we have 3 new financial targets. We start with the growth. We have an ambition for organic growth of around 3% to 5%. That is above market. We've had 4 years of weak sales. I have explained a little bit of some of the reasoning behind that. But we need to get back to growth. This company needs profitable growth.

We'll do that. We have great product innovation. Every year, we bring fantastic new products to the market. We play in attractive market segments, and we will continue to invest in our innovation and our brand and marketing to stimulate growth.

Operating margin, we picked, as I said earlier, we picked up to 12.1% at the pandemic time. Since then, margins have declined. And now we need to turn that. We need to turn that trend around and that will be really driven through profitable growth and through the cost-out program.

We aim to get to 10% in the next 3 to 4 years. And thereafter, and very important, we expect to continuously maintain above 10% on average over a business cycle. Return on capital employed, a new measurement for us, and this is really important to us to ensure we allocate the capital in the right areas to maximize our returns.

We clearly can be double digit in this area. If you look at the chart for many years, we have been double digit. Of course, we have now dropped to a role in 12 of some 7.3%. And -- but through that profitable growth, through improving our margin and becoming more asset-light, we will get back into double digit.

I expect us to reach 10% return on capital employed in the near to midterm and then to reach 15% by 2030. It's very important that we maintain our investments. We will drive the fuel for growth through a big cost-out program. And some of that cost-out program needs to be reinvested back into the business to stimulate the growth and to improve our margin.

If we look at R&D, first of all, we currently invest around 5% of our sales goes back into R&D. We're actually quite pleased with that number. It's a big number. And as we grow our business, we will maintain 5% R&D ambitions. We have great innovation and we need to continue to bring innovation to the market to meet our customer demands. 80% of our sales come from market leadership position.

And to stay a market leader, you have to innovate, you have to bring new products and technology to the market. Brand and marketing. We are currently only around 3% of our net sales in brand and marketing. We need to increase this. If we are serious about profitable growth, we also need to encourage and drive brand awareness and drive customers to buy our product. We will increase brand and marketing to 4% to 5%. We have 2 core brands, Husqvarna and Gardena, and they account for more than 90% of the group sales.

So we will focus our brand and marketing investments in those 2 core brands. We will also have clear prioritization when it comes to our innovation and brand and marketing. And as you can see on the far right of the chart, priority is definitely in the profitable growth segments and profitable areas.

We will invest more in the robotics in aftermarket and water and construction and hand tools. We will invest less below average, let's say in wheeled and less strategic areas. The SEK 4 billion cost-out program. We've actually already talked about it quite a bit and Glen gave a little bit of an analysis of where that comes from.

The divisions will maybe even go a little bit further into the detail. I think what's important from my perspective to get the message across. This has to be sustainable cost reductions, and we really have to do that through improved operational efficiency. In the near to midterm, we expect to deliver 60% of that SEK 4 billion. And my definition of midterm is around 2 to 3 years. Then thereafter, we will deliver the remainder 40% meaning a full year effect, if you like, by 2030 full effect.

There will be around SEK 1.5 billion. of nonrecurring costs, costs that we need to incur to generate the SEK 4 billion cost-out. Of that SEK 1.5 billion, around SEK 1 billion will be cash impacted and around SEK 0.5 billion noncash impairment write-downs, et cetera. The onetime costs, they will be mostly booked in '26, '27 and '28.

So those 3 years will be the time when we really look to book that SEK 1.5 billion. We have the clear building blocks to get to a double-digit operating margin. We've talked quite a bit now around the profitable growth and we believe we can grow this business 3% to 5% a year. The profitable growth will have a positive volume impact and also a positive mix impact as we really grow in margin-accretive areas.

In addition to that, we will deliver on the SEK 4 billion cost-out. But around half of that cost-out we'll get reinvested back into the business into R&D, into brand and marketing, into IT, AI, et cetera. So there's key strategic investments we need for the sustainable future of the group. The external factors that I referred to here are mostly around the inflationary pressures that we will, of course, see over the next 4, 5 years. So we get to 10% in 3 to 4 years, and we will maintain on average above 10% thereafter.

We are a cash-generative business. The last 3 years, I think we have demonstrated that in a good way. We can continue to deliver and generate good cash and good liquidity. We have a solid financial position, and we have a well-managed net debt. Net debt at this moment in time after Q3 was below SEK 10 billion.

We will also maintain our dividend policy of around 40% or above on net income. So we will maintain that. We've talked a bit about becoming more asset light. This is really important to the group. We have some capital intensive segments, which are not necessarily always the most attractive segments either. So we need to address that.

I think we have got a couple of good examples off late. Orangeburg, we divested at the beginning of this year, which was a very capital intensive for our U.S. petrol wheeled, and we divested that around January this year. We also announced in Q3 the closure of Broasted, our handheld component factory and those components will then be sourced to a manufacturing partner. I think those are 2 good examples of how we will continue to lower our net assets.

We've already got a positive trend, and we will look to continue to drive that. Our working capital efficiency also needs improving. We are currently rolling 12, 32%. I also want to be clear that's not good enough. 32% is too high and through operational excellence and through the 20% complexity reduction program, we expect to be around 25% by 2030.

So this is, again, an important measurement for us that we will continue to drive. Maybe also worth pointing out today, of our finished products, 2/3 are still manufactured by ourselves. So I think that demonstrates there is still opportunity to become more asset-light and to address some of that.

Return on capital employed, as I said, it's a new target for us. It's a new metric for us. It is really critical that we are clear on how we allocate our capital to get the best returns. And again, back to talking about the business portfolio units, it's really important. We focus in the right areas.

We will improve our capital employed through the improved EBIT by becoming more asset-light, which I just talked about and improving our working capital. 10% in the near to midterm and then 15% by 2030. We wish to maintain investment grade. We have a healthy debt profile and our net debt-to-EBITDA ratio is currently at 2.2%. Our financial policy is 2.5%, so we are below and within our financial policy.

It's really important that we continue to maintain a solid financial position. We have SEK 1 billion approximately SEK 1 billion of debt maturing in 2026. And you can see the profile that looks thereafter. So a good, healthy debt maturity profile as well. So we feel good about this situation.

And of course, having this strong financial position allows us the flexibility under freedom to move quickly and to grasp opportunities for expansion and growth. Our capital allocation policy, it's disciplined and it's very clear it will support the long-term value creation of the group.

We have 4 key areas of where we will allocate our capital. Investment for growth. We need to get back to growth. We will invest and deploy our capital to support that journey, getting back to growth. I've already demonstrated our ambitions with R&D, brand and marketing, et cetera. We will maintain a solid financial position and a solid balance sheet. And of course, our ambition is to maintain investment-grade credit rating.

Shareholders, of course, our ambition is to sustainably grow our dividend to our shareholders. And again, we will maintain a 40% or above of net income dividend payout. M&A will be complementary and strategic. And really, we will address 4 areas in our M&A. It should be channel expansion, fuel and growth, technology or new interesting segments. But this will really be complementary and strategic as and when opportunities come around.

So finally, to wrap up. We have the building blocks for profitable growth transformation. We will grow our business and we will improve our operating margin. Cost-out is a big part of improving our profitability and our increased investments in innovation and R&D will drive growth. The business portfolio units will be very specifically targeted in each of the buckets that they set for whatever we need to address in those areas. So it's very important we go back to these 11 business units and focus on each one in an individual way. We will improve our capital employed by becoming more asset-light, and improving our working capital efficiency, together with strong cash flow. So with that, Emelie.

Thank you, Terry. So now it's time for our -- the first Q&A session. So with that, please join us back on the stage, Glen.

Just before start, I would like to just remind you that our divisional presidents will share their targeted actions and road maps after our product exhibition. So if you could save some of the more specific questions to that section, that would be great. But anyhow, here we go. So we will start by opening up the floor for questions from the floor. [Operator Instructions]

And those who are joining online, you can write your questions in the web and interface, and we will address them if time allows. So with that, do we have any questions? I think we have the first one here.

Fredrik Ivarsson, ABG. First, on the 2/3 of in-house production, what do you vision for 2030 in that sense?

Terry?

I think it would be wrong to give any specific targets externally. Of course, we acknowledge we have further opportunities to become more asset light the days of manufacturing everything ourselves, those are behind us, and we've clearly demonstrated that of late. .

So we will move to a more asset-light model in our manufacturing. But of course, we are not going to give more specifics into the detail behind that just yet. We're happy to share that as and when we feel ready and it's appropriate. But yes, there is definitely room for improvement there, Fredrik. I don't know, Glen.

I agree with that Absolutely. We're trending in the right direction.

Okay. Second one on the DTC share. You said 10% now. What do your vision going forward?

Minimum 15, but I think in many industries, you can easily say it's going towards 20 or 30. So we would expect probably over 20% in this coming period. .

And how do you sort of balance that with the retailers that you work with?

I think that's the key. Many retailers also have their own DTC. It's not just pure play online. It's also retailer.com or dealer.com. So we just need to work with our channel partners to make sure they are present.

We have Meanwhile, I can just take a question from the webcast. Is the day recorded and shared afterwards? Yes, it is.

Björn Enarson, Danske Bank. On sourcing, big part of savings, is it similar across the group or different actions between the business areas, et cetera? And can you give some tangible comments on how to save those money?

Yes, I can start, and Terry, you can complement. So about 35% of the program is sourcing the savings program. It is quite targeted. It is different per business portfolio unit and quite different per division. Some big areas of how we'll work with more partners on maybe some of the large electronic units, more or subsystems in that case. So we're really working with more third parties to get cost out. And we have a strong pipeline. I don't want to make this as just an ambition where we're a very, very strong pipeline of cost savings right now.

And a big share of those were, as I recall it, also to be midterm? .

Yes.60% midterm.

And Björn, maybe I can just add. Capital-intensive areas when we look at our business units, we will be, of course, more focused on capital-intensive areas where we would look to really drive our sourcing partners. And then we also have to have a vision on the strategic -- the really key strategic areas how do we want to keep that within ourselves on manufactured or whether we want to source it. I mean there's different ways of approaching this for the different segments.

And this also reflects the kind of the globalization that we are seeing now. So you are also adjusting sourcing for those reasons?

Yes, absolutely. One word, yes.

Let's be.

Henrik Christiansson from DNB Carnegie. I mean you've done exit in the past, I mean you highlighted that you did. And I guess, in that sort of portfolio overview that you showed, you have areas that are clearly underperforming. So my question is, how much patients will you have with those businesses? I mean one could argue that you could accelerate this lift your profitability faster by exiting these sort of underperforming areas and get much faster to your target? How is your reasoning there?

So we have very clear targeted actions for the turnaround cases. We have 3 clear turnaround cases. We have targeted actions. If they do not come to fruition to the level we need to, then we'll look at alternatives. And the reason we speak like that we need to keep the focus on the profitable growth. So I want to make sure the focus is on the right areas and not overspend time on the low areas. So patients will be limited in that case.

Limited. I take that as near term, so 2 to 3 years. Is that a reasonable way of thinking?

Reasonable.

Adela?

Adela Dashian from Jefferies. A question on competition, as Glen mentioned, real time now. And maybe some would argue that the reason for your margin pressure is, to some extent, also related to structural headwinds on that side. So it would be great to hear your vision on that going forward.

It's a great question. And obviously, the whole reason behind the margin improvement program and the competitive cost-out that we talk about is to ensure we're going to improve margin. Is it a competitive headwind? Of course, but that's always been the case. But I think taking out this SEK 4 billion is going to be key. We want to support the margin, but to also to support the investments that we mentioned. So I think it's fairly clear that, that SEK 4 billion is a need and why we're doing it and the urgency around that.

And would it be possible to maybe give a little bit of flavor on what proportion the Chinese manufacturers are contributing to the overall pie now on the robotics side?

I won't elaborate on market shares apart from we're a clear market leader in robotic mowers, and we continue to be that and continue to have that clear target. Of course, there is Chinese competition, and we embrace competition.

Can you elaborate on if you've lost market share?

We do not have the same level of market share that we had 5 years ago. That is for sure, but we're still a clear market leader.

Next question.

My name is Johan Eliason, SP1. I was curious about one of your edge is obviously your servicing dealer network. And now you talk about point of sales. Previously, you've talked about a number of dealers and partners and been somewhere between 5,000 and 25,000 or so. Of this 100,000 point of sales, how many are sort of related to your core strength in the servicing dealer part?

It's around 25,000 servicing dealers we have, Johan. That's still the same data point, and we see that's fairly static. But very important is we have different levels of servicing dealers at the real premium end. We have people who have much more people in the field, more online support, more on-site support in that case. And then we have many dealers, of course, who are really servicing in their stores. But we really try to differentiate those servicing dealers.

Good. And then just a question on the charges, SEK 1.5 billion. Is this sort of net of any potential divestments of a plant or a property or whatever -- how should we think about the cash? .

I think Johan, as I explained, to deliver on the SEK 4 billion savings, we need to incur nonrecurring costs of SEK 1.5 billion approximately SEK 1 billion of that would be cash impacted and SEK 0.5 billion noncash.

Do we have any further question. I can then take another 1 from the webcast. Martin. So in what product areas do you see the most aggressive or demanding competition from low-cost competitors at the moment?

Of course, we see competition coming -- let me reword that. The competitive landscape in the past 5 years has changed. We see that we saw more competitors coming into the battery field, particularly power hand tool base from adjacent industries. And then, of course, we're seeing a lot more competition coming into the robotic space. That's what's changed in the past 5 years versus our more traditional competitors that we've seen in the handheld and the construction and the watering space.

Thank you. Anyone else? Johan, again?

Maybe a follow-on up on the competitive space. I mean, we have seen the battery issue on the handhelds, where it's really important to have many different tools on your battery platform and you went for the Bosch platform, 18-volt platform a few years ago. But looking at these power tool players, they seem to be entering more and more into the professional side as well with 36 or 40 volt platforms and even higher. Do you see a risk that as the professional become more mature in the electric battery space that this tough competition will follow you into that core segment for you?

We do see, Johan, of course, battery ecosystems expanding. That's the way I like to look at this more from the lower voltage and occasional use to the more higher power output, if you like, and more intense use. But we've got to make sure we have the right right product or the right application for the right use and that's what we continue to do. Do we see more competition? Absolutely so. But we're seeing limited competition at the higher end of that sort of voltage game. The voltage game is also interesting that in most cases, some of the lower voltage is sufficient for the application needed. .

In the Construction space, of course, we have a much higher voltage system, the 94 volt, which is very intense power need and energy need. So we just need to make sure that we stay relevant. That's what we need to do.

Maybe I can add to that as well. In the professional battery, I think it's less price sensitive, and it's more important about the application and the performance. So long as we have the right products, performing to meet the customer demands in professional, then I think we should not be too concerned around the price sensitivity in that area. It's really about the application.

I think as you come down into the consumer segment and you talk about the Gardena and the power for all alliance. That's when it's a bit more price sensitive.

All right. Here's 1 from Alexander Siljeström, Pareto. Could you quantify the drag from strategic investment in percentage points and the drivers and then a follow up. If you could quantify the drag from external factors and elaborate on what's included?

I'm not sure I fully understand the question. But if I may, our strategic investments, we've talked about being roughly half of the Fuel for Growth program. So we have the SEK 4 billion and we have clear actions and pipeline to deliver on the SEK 4 billion and approximately half of that SEK 2 billion would be the strategic investments. And of course, they have to be aligned. We have to get strategic investments in the near to midterm, but then, of course, continuously thereafter.

So I would say it's relatively closely linked to the Fuel for Growth timing of 60% in the near to midterm and 40% of the strategic investments thereafter.

Just add to that, I think the flavor Terry gave earlier was we're going to go from 3% brand and marketing to 4% to 5%. So there's a 1% to 2% investment headwind that we see. But we maintain our innovation pace, i.e., 5% of R&D to net sales. So there's a 1% to 2% we clearly call out for brand and marketing there.

Good. And the Fuel for Growth program is the name of our SEK 4 billion cost-out program.

Yes, absolutely.

Good. Is there any further price pressure included in the external factors in the bridge?

I think pricing going forward, we talk really low single-digit price increases for '26 and onwards. Of course, there are certain pockets of price pressure. We shouldn't forget some of the price pressure we have faced this year has been around sent out of old technology in our robots.

And that technology sellout is really more or less coming to an end by the end of this year. So we're at a little bit more of a level playing field next year and then low single-digit price increases for the years ahead.

Yes, we have further questions. I think we have time for 1 or maybe 2 quick questions.

You said you have an increased focus on partnerships going forward. Where in the value chain will that be mostly R&D, manufacturing and so forth?

All of them actually Oscar. We need to look at partnerships across the value chain. We will look at some partnerships from a technology perspective to make us faster, but also in the supply chain, that could be logistics. It could be manufacturing, as Terry mentioned. So we look at partnerships much, much more than we have been.

We've got time for one final question, if you wanted one, Björn.

Do you have a view on the cost situation for Southeast Asian competition? I mean, our actions that you're presenting today? I mean, will that take you to a similar cost base as those guys are adjusted for where you are in terms of the offering? I mean you're targeting the range from not the low end, et cetera?

So we believe with our cost out program and our technology road map that will have the best products at the best offering in the marketplace. Now I can't comment completely on competition and how they're going to be in this coming phase, but we believe what we're bringing to market and the cost-out program we have will support our growth journey.

But you have a view -- I mean, you see the listing and what the price certain models, et cetera. So we have considered that when...

We're very mindful of what their offering is, yes.

But to be clear, we don't play in that really entry-level segment. That's not where we want to be.

All right. So thank you all for your questions. That concludes the Q&A session.

So next on the agenda is our product exhibition. So now we will showcase our innovation in smart engineering and 4 of the group's strategic areas. First one being residential robotics, and we have professional robotics. We have smart watering and also our Pro range. So this means a short break for our online audience, and we will see you again at 11:00. Thank you for watching.

[Break]

Welcome back. I hope you enjoyed the product exhibition. And a warm welcome back to our online viewers as well. So now it's time for the next session of today's agenda. It's time for the divisional presidents to present their road maps and in the transition to profitable growth.

So with that, I would like to invite Interim President of the Husqvarna Forest & Garden division, Omar Attar to the stage, please.

Thanks, Emelie. Hello, everyone. Great to be here. Today, I will share with you our plans to unlock the growth that we've talked about earlier this morning as well, how we will continue to lead in our robotics as well as how we will improve performance, both in our handheld as well as our wheeled business. I'll also share with you what we're doing in Husqvarna Forest & Garden division related to our transformational cost-out program, of course. .

But before I start, let's set the stage by giving you a brief introduction to the Forest & Garden division. We're the global leader in residential and professional green space and term management, and we hold the #1 or 2 positions across all key categories. Our net sales rolling 12 is approximately SEK 28 billion with an operating margin of 7.9%.

While margin improvements have not really met our ambitions, we're taking -- you will see later, we're taking clear targeted actions to unlock those profitability improvements going forward. Europe and North America remains still our largest regions in the division, while we also see some good growth opportunities in emerging markets as well as the Pacific.

Our growth will be driven by innovation, as Glen has alluded to earlier, as well as leveraging our strong dealer network and expanding into both retail and online. We have today sales in over 100 countries, supported by 25,000 trusted and experienced dealer channel partners and 5,700 employees all dedicated and committed to deliver a premium customer service every day.

So with that short introduction, let me walk you through in terms of how we will drive operational excellence in the Forest & Garden division. As Glen mentioned earlier, to deliver on our growth ambitions, it is critical that we also streamline our operations and deliver on our cost-out ambitions. We're therefore executing this Fuel for Growth program, as we call it, which is a cost-out program designed to strengthen our competitiveness and enable reinvestment in profitable growth.

It builds on the same elements as Glen presented earlier, 3 areas: sourcing, design to value and manufacturing. And we start with sourcing, 80% of our product cost today is direct material. So this is naturally the biggest lever for us to drive. A great example here is the way we have changed our ways of working with electronics and sourcing related to subsystems as well as finished goods -- or sorry, other components, electronic components.

And looking into -- and basically leveraging our scale. In terms of scale, purchasing power in those as well as consolidating our supplier base, including lower-tier suppliers. Within design to value, we're looking to simplify, continue to simplify our platforms and introducing modular design that will both drive complexity reduction in our portfolio as well as give us ability to scale. And that's a good example of that is what we have done with our electronics architecture in our new robotics.

And within manufacturing, we have already presented earlier, our outsourcing of nonstrategic components. A good example of that was the recently announced closure of. We'll continue, of course, to optimize our footprint to best cost countries. And we will continue to leverage and scale partnerships such as we do have in North America with Flex. Now in addition to those, to enable that and to focus the sharpen our focus in the value chain, including our focus internally in the organization, we're also driving complexity reduction of our portfolio up to 20%.

And we will do this by targeting underperforming models, as well as applying modular design as we build the product road map ahead. These initiatives together will help us to drive a better financial performance, free up funds to reinvest in the business as well as boost our return on capital employed.

With that in mind, let's take a look at an area where we definitely will keep reinvesting and with an opportunity, a great opportunity of growth, our residential robotics. Sorry, before I do that, let me just refer back to the BPU mapping that Glen laid out earlier, and this is how it looks like for the Forest & Garden division. We have our core wheel business in the turnaround and then our core handout in the increased profitability segment and our Pro Robotics in the profitable growth.

We will walk through each of those areas here, just to give you a recap of the mapping of our portfolio there. So let's start with the residential robotics side. Husqvarna pioneered this, the robotic lawnmower category 30 years ago. And today, we still remain the clear market leader. As a premium brand, our strengths are built on these 5 areas, as you can see here, from an unmatched performance and reliability to products that are built to last 30 years of domain experience and then complemented that with an experienced dealer channel network as well as our best-in-class premium aftermarket and service offering.

These strengths are backed by decades of innovation as well as some real-world proof points. And Glen mentioned that earlier. I think it's worth mentioning again. In fact, 80% of our -- all our connected residential mowers installed in 2016 are still operating today. It's a great proof point of our quality and durability.

Another proof point and also an important differentiator is our premium aftermarket and service offering, where we basically have lifetime service and support. We also guarantee parts availability 10 years after production, and we have industry-leading digital tools to help with diagnostics and maintenance.

Let's now look at the growth opportunity within residential robotics. So despite our leadership in the residential robotics category, the market penetration remains low. As you can see here, Scandinavia leads the way with approximately 30% penetration rate, while most other markets still remain early in the adoption curve. And here, we see -- we expect the market -- the market is expected to grow by 15% -- more than 15% annually, creating a significant opportunity for growth in this category.

So how will we capture the growth? Our plan is clear and focused and builds on these 5 areas that you can see here. Let me walk you quickly through each of those areas, and let's start with the channel development there at the top. So we will be driving an accelerating penetration as well as expanding our distribution. That means that we will continue to expand into both retail and online as well as we will continue to enhance our dealer network.

Innovation is, of course, a core piece of our future growth. And through our innovation hubs, we are working very intensely now to speed up time to market as well as to boost our competitiveness by working closely with partners through those innovation hubs. And as you saw in the product exhibition out there in 2026, we'll also launch a new mower platform for the suburban consumers, which covers lawn sizes up to 1,200 square meters. It will -- it's a wire-free technology will feature vision and AI and will be offered at competitive prices.

In addition to that, we'll also introduce the vision with nighttime capability at our 400 series and most of our 500 series mowers as well. In addition, we'll also introduce new dealer tools to make installation much faster and better going forward as well.

Beyond 2026 and further, we will lead the next wave of autonomous lawn care with even smarter functionality and enhanced digital experiences. Moving on to the product cost. I think Terry and Glen mentioned that earlier. We have a very strong pipeline of cost reduction initiatives in this area in robotics. And that is very much needed to increase and strengthen our competitiveness in the market.

With brand and marketing, we will use some of that cost-out and reinvest in amplifying our brand presence in the key markets, and we will continue to work with global sponsorships such as we have done in a very successful way with the Liverpool Football Club. And that helps to both increase awareness and increase the demand for our products.

Finally, premium customer support. Again, this is a true differentiator for us. And here, we will continue to work with new digital tools to enable even better and smoother troubleshooting and maintenance. Together, these 5 execution levers, if you will, will help drive both profitable growth for Husqvarna and also sustain our leadership position in residential robotics.

Now having covered residential robotics, let's move into the professional side and equally exciting, if you will, area and of growth for us in Husqvarna. The professional robotics market, we define that in 3 customer segments. We have the Gulf. We have the sports and we have facilities. And within facilities, we include housing, it could be education, it could be public spaces. It could be military, it could be anything basically outside of sports, which requires professional applications.

And just want to pause here, Husqvarna is the chosen brand in professional robotics, and we are the undisputed #1 player in the professional robotics area. And our leadership is built on these 5 strengths truly matters for professionals. If we walk them through quickly our broad portfolio mowers covers all sizes and all major applications. But it's not only the mower itself, it's all the digital tools that come with it to make fleet maintenance and management much smoother.

When it comes to uptime and durability, our machines, they're built for a long life and again, supported by digital tools, all to maximize productivity and uptime for our professional customers. And our superior cut quality and turf quality, our customers consistently report top playing conditions and aesthetics using our products.

But our strength go beyond the product. It goes further. Like Glen mentioned earlier, we have a dedicated dealer network supporting these professional customers. We have our Pro partners in Europe and we have a GST golf sports and turf dealer network in the U.S., very strong, very experienced dealer network to provide best support our professional customers.

And then our premium aftermarket and service offering as well, which -- which I've alluded to before, including things like extended warranty and also leasing -- the leasing solutions. I think the leasing solutions is also a very critical enabler for us to continue to grow in the professional robotics sphere. And as you can see, our proposition is -- our value proposition is strong and clear. So it's lower total cost of ownership, consistent cut quality and also clear sustainability benefits coming both from noise, noise reduction as well as CO2 emission reductions and also a solution is on labor shortages.

And these are not just claims. As you can see here, our strength are endorsed by respected organizations such as the R&A, which is the golf governing body for golf outside North America and Mexico and also by the usage of our robotics at prestigious golf tournaments such as the AIG Women's Open, where we actually had our robotics mowing all 18 holes of that tournament, a historic first, I think, in the industry.

So that is what makes Husqvarna the leading brand in professional robotics. Let's now look at the growth opportunities within the professional market. We've demonstrated a strong growth here already with -- we have 1,700 courses today use our products, robotic products at some scale, but that's just a fraction of the 38,000 courses globally. So you can -- you see the potential here is absolutely massive in this area.

And the market is expected to grow by more than 30% annually, driven by the demand for sustainable solutions. This is what this map shows and golf is our -- one of the most demanding applications. With that, we also see now that we're getting a halo effect and a good sustainable foundation to accelerate growth in sports and facilities as well, which is really great to see.

And the growth will come from increased penetration, market expansion and entry into adjacent applications. So massive growth opportunity, and I would be bold to say we're not just leading this. We're actually shaping a multibillion growth SEK opportunity here for Husqvarna.

So how will we capture this growth? Our plan here again is focused and clear, and we will double down on these 4 areas. It's the Pro channel. It's rapid technology and innovation. And of course, it's brand and marketing that we talked about and our premium best-in-class after market.

So let's quickly walk you through. Like I mentioned earlier, we will continue to invest and develop our Pro partners, the dedicated dealers for our professionals. We'll also rapidly advance in technology to improve both uptime for our professional customers, which is so important as well as ensure that we can deliver consistent turf quality across every climate and every surface. We'll amplify our brand presence by working closely with partnerships in those areas and those partnerships in the professional sphere, if you will, they create -- they strengthen our credibility in this area.

But not only that, more importantly, they also give great insight, and we also get an opportunity to to create future plans, which will solve the challenges that the professional customers have today and tomorrow. So it's a great opportunity to work with those partnerships. And we keep differentiating ourselves through our aftermarket premium best-in-class support. And this again includes continued rollout of our leasing solutions that we offer to other professional customers.

So these focus areas together will help to cement our position as continued as the global market leader of autonomous Zero imaging solutions. Now let's move into our handheld business. Our handheld range, including products such as chainsaws, trimmers and blowers remains a cornerstone in our overall portfolio.

Looking at the market dynamics here, we see that the overall petro market is projected to decline in those single digits annually. But we still see strong demand in some key markets and also, especially in the Professional segment. That is driven both by infrastructure gaps as well as the need for power. So within -- within the petro segment, our plan and strategy is clear.

We'll continue to gain share in some of those key markets. and will also lead with innovation in those. And a great example is that you can see here is our recently launched 564 Pro Petro chainsaw delivering high performance in a compact design and very well received in the market so far.

In the battery segment of the handheld, the advancement in technology is growing fast, and we also see increased regulation, which then is turning an accelerated growth in the market, and we see that market to grow by mid- to high single digits going forward.

Our plan here is to continue to accelerate our electrification offering in this space by working closely with partnerships to deliver, as we have in this Pro backpack here is also developed in a partnership. Now as electrification transition continues, just wanted to be clear here. Our priority in the handheld is to improve profitability.

Coming back to the BPU that we saw earlier. So improving profitability is key in this and especially in the residential segment of the handled business. And we will do this via our transformational cost-out program looking at methodical material savings, product redesign, portfolio optimization and of course, leveraging those partnerships, as I mentioned earlier.

So in summary, for handheld, we will increase profitability, continue to grow in key markets and accelerate our electrification portfolio going forward. Now let's shift gears to the wheeled business, if you will.

Our real strategy is built on two priorities. The #1 priority or number one, I should say, is to protect our #1 leading position in front over in Europe. And number two, it's to really turn around profitability in North America in that assortment. The market dynamics here is similar but perhaps a little bit exacerbated versus the handheld. The petro-driven wheel we see there a continued market decline with low single digits annually going forward.

While the battery platforms are going to increase at an impressive growth from up to middle to double-digits growth we see here in the battery segment. And that is mainly driven by the development in Europe. Therefore, in Europe, we'll continue to lead with innovation in the wheeled by extending the range and balancing it between both petro and battery, and that is to capture the growth and protect the profitability as that market transition going forward.

And in 2026, we'll launch our first battery-powered Pro ride on, as you can see here. which is really a big milestone for the industry as well as the first professional battery powered. And that reinforces our position as the -- in innovation and also responds to the need for further electrification in the wheeled business in Europe.

In North America, our real strategy, as I mentioned, is about turning around profitability. And we will do that through those initiatives in the transformational cost-out program, as I mentioned. For both regions, it's going to be key. The aftermarket and premium support will be key to drive competitiveness and profitability in this category.

So in summary, we'll continue to lead with innovation in Europe, and we will turn around profitability in North America. Let's now take a closer look at our at our aftermarket and solutions. I mentioned that several times today, and I think will has come through quite clear that our premium aftermarket customer experience is a true key differentiator for us.

It builds customer loyalty and in return, it also delivers profitable growth for Husqvarna. And we have a significant growth potential in this area. Today, if we look at our share of wallet for aftermarket sales and services, our share of wallet is approximately 20%.

Our target for 2030 is to really increase that to 45%. Let's put that a little bit in context to you. In our chains of business today, we have a 40% share of wallet, which we have built by creating an ecosystem that really responds to the customer needs. That to me is a good example to show that we have the ability to scale.

We have a great blueprint that we can use as a starting foundation, but it also represents the amazing opportunity ahead in terms of growth that we have here ahead of us. So how will we do this? We will take a global aftermarket approach on this, focusing on these 4 key areas.

We will continue to elevate the dealer experience to premium standards, and we'll continue to expand our multichannel. We have a big focus on operational excellence, as we talked about. This includes spare parts availability and fast and reliable service. We'll also start leveraging more and more data in AI and move more from reactive to proactive maintenance, more predictive and also offering proactive service recommendations to our customers at the right time.

And we'll continue to develop self-service tools and remote diagnostics to empower our customers to solve their problems in a quicker and smoother way. And to the right there, you can see examples that -- of our product and service offering that brings this strategy to life from the Uptime Center to the Husqvarna Service Hub our lease plus program and second life, all reinforcing our premium position and delivering measurable value to our customers.

So together, these areas create an aftermarket ecosystem that really delivers delivers increased customer loyalty, accelerates our profitable growth and reinforces our competitive edge. So before I close, let's step back you look at some of the core build to deliver sustainable and profitable growth going forward.

Our transformation is underway. We're executing on a clear strategy designed to increase competitiveness and to unlock growth. We'll continue to lead in robotics through innovation, leadership, through expanded distribution and increased market penetration.

We will improve our performance in our wheeled and handheld categories as we -- as the transition for electrification is happening. Secondly, we'll expand our customer reach by enhancing our dealer network as well as expanding to new channels, such as online and retail, and we will strengthen our go-to-market capability as well to delight our customers every day, wherever they choose to engage with us.

Third, we're executing a transformational cost-out program as we've talked about, our Fuel for Growth program, which is designed to increase our competitiveness and really free up funds to invest in future growth. And finally, we're delivering a premium aftermarket experience here again, that will increase customer loyalty drive profitable growth for Husqvarna and be a true differentiator for us as we go forward.

This is how we -- this is how we create a more focused, more profitable and more resilient business in the Husqvarna division that will deliver sustainable value both to customers and to our shareholders. So I'll leave you with that, and I'll come back maybe later on any question -- Q&A session. So next, I would like to introduce Maha for the Gardena division. Welcome, Maha.

Good morning, everyone. Before I take you through the Gardena 2030 ambition and vision and our clear action plan, I first would like to start with the Gardena division today.

Today, we are the #1 residential watering company in the world. We operate in a SEK 70 billion market. What we bring to our consumers is a fully gardening solution from water management to our smart watering, cutting tools as well as cleaning accessories.

What does this mean? It means that we are part of our consumers' lives wherever they are in their consumer journey. Whether they're an apartment, and they're looking for a garden in their terrace or when they move on to a bigger home and they actually have a large garden.

Our consumers know us quite well. We have over 80% brand awareness in our DACH region. What does this mean? It means we grow up with them in their parents' homes and in their grandparents' homes. By nature, when you're a consumer brand in your consumers' lives, this means you have a quite a strong hold in the retail market.

So you can find us in 65,000 outlets globally. We also have a very strong presence in e-commerce as well as in a digital ecosystem. Well, what does that digital ecosystem mean? It means we actually have the largest used app in the gardening markets. So mygardenplanner is the largest planning app in the DACH region. Our consumers are able to communicate with us, build their own garden and actually, for us to have access to what they are thinking, and that's how we communicate with them.

In the last 10 years, we grew our business. Today, in the last 12 months, we delivered SEK 12 billion. We clearly benefited from the COVID effect, and we grew significantly as well as we benefited from Orbit joining us and being part of the division. But that also came with an impact of their operating margin. We right now operated to 6.1% and before we operated at high single digit as well as even double digits. In the division, we have 3 BPUs; watering, which is 60% of our business today, and we go to market under the Gardena brand and the Orbit brand in the U.S. Hand tools 15% of our business. And we are mostly in the European market with the Gardena brands. Powered Garden, we actually have 2 segments under it. We have battery and electric with 15% and robotics with 10%.

And as you can imagine, the reason we put them together is their product that requires a battery or electricity. That's why we call the powered garden. The 3 BPUs actually have quite different business models as well. With watering, we are very close in the market to our customers as well as our manufacturing, similar with hand tools. But powered garden, we actually have a diverse business model where battery and electric is actually 100% completely asset-light.

We have clear plans for each one of these BPUs for us to grow by 2030 and to address our issues and our transformations. But before I take you through all of that into details what our focus plans are, I want to take you through our Fuel for Growth transformational program of how we are going to actually fund it. Similar to what Omar and Glen have mentioned earlier, we have the same exact program with 5 key pillars underlined by complexity reduction.

Sourcing for us is a critical element of our growth, and it's actually pretty critical today. We have over -- we have a solid double-digit number of our finished goods product that is sourced today already. Sourcing is important because it gives us access to competitive pricing, but it also gives us access to innovation and technology, and we know how to do it. And our goal is for us to grow that percentage even higher, especially in categories where we do not need to have closeness to the market.

Just think about it, watering, if it trains, less likely for us to sell product. But if it doesn't rain, then the market grows exponentially, and we need to be very close. And that's a different business model than for example, hand tools, where a consumer is willing to wait.

Design for value platforms. If you have bought any Gardena product, you realize we always talk about platforms, whereas you have a house, you have, they off together or combi systems. So we believe in platforms. But let me be also very honest, I don't think we believe then it enough. We believe in differentiation. And having the value for creating a completely different product where we can, and that's one of our biggest points as we are going to have a very good understanding -- better understanding of where differentiation is required by our consumers.

And our goal is to have more platforms, both on physical products as well as digital products. Manufacturing footprint. This is very important for us as well. We need to have the right print for the brand and for the product category depending on the requirements of the market. Complexity reduction, we are a consumer company. You can just imagine how many differentiate this product we have as well as brands.

And our goal is to actually bring that into focus and to really focus on actually eliminating at least 20% of our portfolio and brands as well as even our core brands with our Gardena and Orbit. And to be able to do this, we have to have a differentiated plan for each one of our BPUs because they are fundamentally in different places in our portfolio. Watering and hand tools, the goal for us is to drive the -- continue to drive the profitable growth, which is a little bit different than where Orbit is whether we need to increase this profitability. And lastly, for our powered garden, we can need a complete transformation.

Watering top right corner of the graph. We operate in a SEK 30 billion market. Being a company that's over 60-year heritage, we understand what the consumer needs are in watering. This is where our heritage started. Our innovations are all targeted to consumer needs today. We create systems for them. And we also now are creating a lot more on the smart innovation and smart solutions, which is what they need.

We understand our consumers very well. And more importantly, we have external testing and consumer sentiment about how we are performing, if we are hearing them or not. What they tell us we are because they have rewarded us with the #1 market share in Europe as well as the #1 market share in the U.S.

So one could argue, where is the growth? There's a lot of opportunities for us to grow. We have markets who are not #1, like in Eastern Europe. There are markets for us that we are not #1 like in France, U.K., we're not #1. Middle East and North Africa, we don't even exist. So there are opportunities for us to grow.

The #1 growing segment is smart watering, whether that's in residential pro. Yes, we are #1, but the opportunity is significant. When there's significant, there's also competition. So we also have to make sure to stay on top of our game. So we do see a significant growth in this market, and we plan on making sure that we stay #1 in that segment in residential. We plan on doing that by focusing on innovation that matters in form of platforms, which is very important.

E-commerce is critical. There was a question asked earlier about D2C. It's very important for us, for our customers, whether we're selling direct or we're selling on the Amazon platforms or our customers. I'm sure you've heard Lowe's Depot, will be everyone talking about the importance of the e-commerce.

And lastly, for us, which is going to be an area where we're going to be devoting time and effort is professional. We want to grow in the professional market, but not where we would say it's more of a commodity or we don't have a competency. We want to focus on smart watering, where we have a significant competency.

And the reason for this -- it's other than keeping our #1 position. We see a strong high single-digit growth in the watering market across mid-range premium as well as the professional. And this is where we see our growth coming from. Hand tools is actually quite a similar story as well for watering, where we're able to offer our consumer solutions across cutting as well as cleaning and very innovative accessories. Our performance is our differentiator. And we have that cutting performance in robotics, as Omar mentioned earlier, but also with our cutting tools.

And that is why our consumers I can assure you, a German consumer that wants to live in their home for more than 30 years, they do not want to buy to a last season and replace it this season. Their expectation this is going to live for 8, 10, 15 years. And that's what we offer them.

And when we cannot stand by that promise, we take care of them with our after sales. And our consumers have rewarded us for that as well with clear #1 market share in Europe, selected European markets actually. So the opportunity for us to grow is pretty simple. Other markets in Europe where we can become #1. We don't have any meaningful presence in the U.S., so that is also an opportunity for us.

And the reason we want to do this is because this is a SEK 20 billion market. It is going to continue to grow solid single digits, and we believe we have the value to outperform the market by entering new markets, continuing with our innovations, especially in cutting and tools and driving our costs down as far as building more platforms and being more consumer-centric. So it makes sense for us to invest into these -- into the hand tools market and to continue with the leadership we have.

I have to say, once we start to talk about the powered garden, this is where we have to pivot with our transformation. Battery and electric, as you know, is one of the largest segments in the market. The easiest answer would be, well, why stay? You have not been successful. So why leave the market?

Well, as I mentioned earlier, we are in our consumers' lives. We offer them full solutions. They know our brands. They want to be into our product portfolio as a complete solution. We have pivoted with the battery and the electric segment in the last few years. We have joined the Bosch battery for all alliance and that has been a big benefit to us. We have updated and upgraded our partners to create our innovations.

We have brought meaningful solutions at the right price points. So I would say battery and electric is definitely on the right pace. But we have still work to do, and we need to be more aggressive with our sourcing. And we have to also be selective with what innovations we bring in.

Today, we are the #2 market holders, shareholders in selected markets like the U.K., like Germany and like with more opportunities in France with more opportunities in Europe. So we have opportunities for us to grow profitably, which is the keyword.

So what are we going to be doing in the next 5 years is different today than today? We're going to continue to enhance our operating model for speed and for cost competitiveness. This is an area where there's a lot of competition because of the market size expected. But we also have a very good chance of winning in that market.

We are going to focus where you're seeing the biggest growth in the market. It's coming from e-commerce, and we are going to focus to be the leaders in the e-commerce market in battery and electric. We also have to invest in building and reminding our consumers of the value we bring.

So we're going to be investing in more brand marketing and having the right brand in the right market. So probably being in the U.S. is not in our near future over investment because it doesn't make sense for us. Gardena brand and battery and electric does not belong in the U.S. market. So that is not an investment we are going to be looking. Another decisive transformation for us is robotics.

First and foremost, what value do we bring into the robotics market. Omar said this very well. We are about performance. We bring the best cutting performance into the market, relying on the Husqvarna platforms. We bring in quality and we bring in longevity.

We have one of the best after-service retail program. We have a significant number of our consumers that bring in, sends us the robotic every year for us to clean and to winterize to send it back to them. They do not expect the robots to live for 2 to 3 years. They want them to live for 8, 10 years.

And that's what we offer our customers. Quality, longevity, durability and after service. We have external test results that confirm the performance we have, and that's the differentiator. We work very closely with our retail partners on making sure that they are able to also deliver on their commitments to our customers and to have quite low number of returns, which is very important for them.

That said, this is the most competitive market we have in the division. By nature is the one that's growing the most, right, solid double digit. So more competition coming in and we have to expand our operating model.

Today, we are mostly European focused. And our goal is to expand by working closer with our partners, expanding our innovation hubs, working closer with our technology partners and also working closer with the manufacturing partners to help us become more cost competitive, because that is where the market is going today, and that's what we need to do as well.

But we also need to focus, and we are going to be focusing on our leadership in e-commerce, that is the channel that's growing the most with robotics on the retail side of the business. And that's where we are also going to focus. We're also going to be focusing our brand and marketing spend to build our brands, but also to remind our customers, quality and durability and cutting performance is why you buy a robot. Technologies are still being developed and they're evolving. And our goal is to explain that to them and to help them understand that.

But we have work to do. And lastly, we're also going to be investing in enhancing our aftermarket services to be able to have a profitable growth. But it is the market we need to be in, Yes. is the market our customers want us to be in with us. Yes, our consumers, absolutely, because we are part of their gardening journey from when they were at this little.

So as a wrap-up, we have 4 clear pillars for our transformation and our growth for 2030. First and foremost, we have to protect what we have. We're in a very good position with having clear #1 positions with watering and hand tools. We have to transform, and we have to also figure out where we need to take our battery and electric and robotics business in regards to profitability, but it has to be profitable.

We have to take care of our brands and our consumer centricity. We cannot not invest in our brands. This is very important, especially when we have a lot of competitors coming into the market. We have to remind our consumers of the value proposition we bring versus others. And we are going to selectively focus on growth markets like Eastern Europe, like Southern Europe, like Middle East and Africa, like the U.K. in selected segments like the Pro smart watering specifically. And with this, with the focus we're going to create, we believe we're going to be able to deliver on the ambition that we have. And with this, I hand over to Karin Falk for Construction.

Hi, everyone. I'm looking forward to share with you today how we are building a stronger, more focused and more profitable business for the future. As you might know, we are a full service provider in the light construction industry. We operate globally with sales in over more than 100 countries with a turnover of approximately SEK 7 billion in an addressable market of roughly SEK 40 billion.

As many others, we have been hit by inflation, but thanks to our really dedicated and disciplined price and cost management and also most recently, our product cost-out program, we have largely managed to preserve our EBIT margins, and you can see that they have really followed the business cycle and stayed in the high single digit or in the low double-digit range.

But we have clearly a lot more to do. And our demand is driven mainly by GDP, also the development in interest rates as well as the construction spending. Geographically, as you can see, we have our largest market in North America, where we have seen a softer demand since early 2024, but we now see a stabilizing trend in combination with a more positive development also in Europe.

In margin -- in emerging markets, we see interesting growth opportunities due to the adoption of modern construction techniques as well that high construction spending, but we have also experienced more tough competition from low-cost Asian manufacturers. But despite this geographical expansion and especially then in emerging markets is still a key priority for us.

Our market is still fragmented with many smaller specialist players, which actually opens up for targeted acquisitions and something we have done successfully in the past. And in this fragmented environment, we are a global leader, thanks to our high-performing premium and innovative solutions. And that also can help our customers become more productive, which then means, of course, also more profitable.

And an important part of this offering is also our aftermarket services, which creates loyalty as well as recurring revenues. And in addition to this, we have a strong and diverse channel network that gives us a broad market access and also keeps us close to our customers and their needs. And I'm proud to say that our customers tells us that our sales force is truly appreciated and something that differentiates us from competition.

And these actually come back to our overarching ambition to be the trusted partner. We are active in different areas of construction, as you see here, residential, commercial and infrastructure and operate in 3 segments or 3 business portfolios then in this environment, which is sawing and drilling, surface preparation and compaction concrete placement and light demolition.

And we sell through dealers, our own sales force, direct sales force as well as through the rental companies. And our diversified customer base provides something like a natural hedge since in recessions, our contract or direct business tends to hold up a little bit better often supported by infrastructure investment. And this is an advantage that can somewhat mitigate the downturn in one construction segment with some better stability in another.

And that is also related to that we are part of both renovation and demolition, so not only then to new build. And for us, this stuff actually provides a good platform for growth together then. So it really creates for us some reach resilience and also a platform for growth. But to fully capitalize on this platform, we need to further simplify and focus how we operate.

And despite continuous portfolio management that we really have done, we still have products with lower sales contribution and also overlapping products due to past acquisitions. And this tail and this overlaps adds cost and complexity.

Fewer models means easier demand planning, less complexity in our factories, more focused sales execution and over time, also more efficient after market. So that's why we really have taken now an aggressive end-to-end approach to cut this tail and also to eliminate overlaps. And to start with, we will remove at least 20% of our equipment models by mid-2027.

But it's also about embedding and lasting mindset, not only doing this over and over again and also then to shift to a more modular platform-based approach. And a good example of what we mean with a platform-based approach is actually our new dust extractor range, the DE range where we have taken the best of breed from several overlapping portfolios from past acquisitions.

And where we have fully executed, we would have reduced complexity here from 55 to 17 models. And at the same time, we have consolidated several acquired brands under the Husqvarna brand. So by cutting the tail and reducing this overlaps, we will be easier to do business with we will also be faster and more efficient.

In addition to this, we also work with product cost-out. As you have heard many say before, to increase our competitiveness and also to enable reinvestments in growth. And this cross-functional initiative has clear targets to standardize, simplify, but also to take out costs across the whole value chain. It focuses material cost out, platform alignment and manufacturing, as you can see on this high-level summary.

And our biggest savings will come from platform changes as well as direct material cost-out. And this is a structure, long-term end-to-end approach on how we design, source and manufacture in order to safeguard that each new product platform is leaner and more efficient from the start. This is what we call operational excellence for us. And this is a key area to a Fuel the Growth across our 3 BPUs.

And as a reminder, you know the drill now. This slide comes up. This is the slide that Glen showed earlier that shows the performance of our different product portfolios within Construction. And I will, of course, also comment on all 3 of them.

Starting then with sawing and drilling. This is our largest business where Husqvarna is a global leader with strong positions in power cutters, diamond tools as well as sawing solutions. And here, our priority is to protect and also to grow the core with focus on productivity, safety and sustainability.

We will also continue to invest in combustion engine solutions for power cutters when it comes to -- when it relates to emission regulations as well as alternative fuels. But in parallel, we will also drive electrification since that is something that contributes to our customers' reduction of carbon emissions, while it also delivers lower noise, vibrations and a better handling.

And electrification, as I mentioned now, is actually expands over all of these 3 business -- portfolios that I will talk about, and not only sawing and drilling. And already today, we have more than 40% of Husqvarna Construction's equipment portfolio that runs on electricity, either a battery or a.

In our second segment, surface preparation, I think we are well positioned to capitalize on the modern portfolio that we have from our acquisitions. Here, we are improving margins by reducing product complexity, but also by gradually phasing out our acquisitions, amortizations that still burden our results.

We see good growth potential in this segment where we really are a leader due to also the -- that we now have access to complementary surface preparation techniques that we got from the Blastrac acquisition. And we will strengthen our position in this segment through innovation, complete solutions, and also new launches.

And I think that you perhaps noticed outside in the exhibition the Husqvarna auto grinder, we will, of course, also have new diamond tools and also dust management solutions that all are focused on increasing our customers' productivity and also operator safety.

Thirdly, moving into compaction, concrete placement and light demolition. And this is our smallest business, and it's also quite broad. So therefore, I have divided it into since they are a bit different. But let's start with light demolition. And here, we have a strong global #2 position.

And we will drive growth here through our own direct sales force, but also to have good and agile after sales services and with new -- entering into new applications. As you hopefully met our demolition robot out in the exhibition that was a DXR95, which is one of our new additions to the portfolio that takes us into new segments.

Besides this, we will also enter some selected and are entering some selected industrial segment, which also makes us having good growth opportunities and takes us a bit outside of the clear of our normal sort of concrete segments.

If I then talk about compaction and concrete placement. This is a segment with lower profitability than the divisional average, but it's still important since its offer a key complement to our channel partners and also addresses important customer groups. Here, we actually have a low market share in a quite big addressable market. And we have a close follower position as #4, which also gives us a good growth opportunity.

The issue here is, of course, profitability, as you heard. And what we are doing then is focusing on aggressive product cost-out together with strengthening the channel partnerships in order to be more profitable, but also have the possibility to grow. And all these 3 product portfolios are supported by a strong aftermarket that, of course, builds recurring revenues, but also by that and strengthening our business resilience.

For our customers, uptime and productivity is key since the earned a living from the performance of our products. So by offering a fast support and a broad range of services, we help them to improve their productivity and profitability. And going forward, we are enhancing the customer experience by having a stronger service footprint more better proactive maintenance, also improved parts availability and also a fast and efficient field support.

And these efforts will strengthen customer loyalty as well as building predictable revenue streams. And at the same time, they are actually improving our customers' productivity and profitability. So it's a clear win-win. But so to summarize, we are starting from a clear position of strength. We have a strong brand. We have high-performing premium, innovative, sustainable solutions that are based on customer insights.

We have a broad and diverse network, a good aftermarket that our customers truly appreciate, but we will also then strengthen as you have heard. But what defines our transformation is how we run the business. So we are simplifying the portfolio. We are shifting to a platform-based design. We are taking out structural cost, and we are enhancing our sales and aftersales execution. And all these long-term activities are making us more focused, faster and more efficient.

And this will help us contribute to that we can grow and be more profitable in a still very challenging business environment. And to execute, we have a dedicated team with clear road maps, but above all, we keep our focus on the customer. If we help them succeed, we will succeed too. And that's why our overarching ambition is clear, to be the trusted partner. Thank you.

Thank you, Karin. Now it's time for the final Q&A session. So the rest of the team, please join the stage. Good. So everyone's here. Great. So we will again open up the floor for questions. [Operator Instructions] So do we have the first question?

I have maybe 2 or 3 questions. On Gardena and growing in professional irrigation, if you can add some comments on what kind of market size you are aiming for, et cetera? And then secondly, on Construction, I mean it is a pretty sound business in a attractive market. But I mean, how quickly will diamond tools be electrified? And typically, we see a little bit of margin pressure when products are being electrified?

You want to see a start Yes. You can talk. Okay. I start. So taking on the question, as you said, what is happening with profitability when we get more electrified. I can also say that when we talk about electrified, we talk both about corded and battery we have quite a high degree of corded products. When it comes to battery, we see that it's what we talked about before that we are really focusing on having this really specialized products for the heavy users. I think it was mentioned before, we are both capitalizing on the 36-volt platform from Forest & Garden, but also our own 94 volt, which is a really high power solution.

And there, we see that it's from a profitability point of view, that there is at least a possibility to have somewhat higher margins than what you have in other battery segments. But what we can say in general is that the uptake of battery is quite slow still in our segments.

So for the professional irrigation, specifically, we are estimating that market to be in the United States around SEK 20 billion and in Europe, somewhere between SEK 10 billion to SEK 15 billion. Of this market in the United States, we are estimating the smart watering control to be around somewhere between 8% to 12% market. And that's the market that we want to focus specifically on we are not interested in any of the drip irrigation or underground irrigation. That for us is more or less well saturated market with the competition.

So our goal is to target the smart watering, somewhere between 8% to 12% with a very solid double-digit growth over the next few years. And that's where we are going to be focusing and we are there already in that market.

Do we have any further questions. Henrik?

Henrik Christiansson from DNB Carnegie. Question on the service market growth. Obviously, you have clear ambitions there. And I guess it varies widely between Pro and residential and between the product categories, groups, et cetera. So how do plan to grow there? Because my impression was that a lot of the service is actually provided by the dealers. I mean, yes, of course, you get the parts part, but the service part perhaps it's done by someone else. Is it like service contract type of business? Are you going to have more interactions through apps, et cetera, direct sales? And how will that compete with the important dealer channel?

Now I think, as I mentioned earlier, I think what we will do is we will continue to pass availability is a critical aspect of that, of course. And that were where -- and that comes back to the operational excellence, which we've talked about before. So we're putting a lot of effort and investments into making sure that parts are available at the right time at the right place. That's one aspect. And then we're also lifting up the the dealer standards in terms of getting a premium standards across and also a standard service wherever you go. So you recognize yourself if you're a service here or a service here it's the same high standard across all our dealer networks.

So we're lifting up with dealer development programs that we're putting in place. So those are two aspects that I think about. And then we're also coming back to this predictive maintenance and service recommendations. I think that is also a very important element where we can leverage AI and data at much more scale than we're doing today. So those are three, I don't know if you want to add something.

Karin, anything to add?

Yes. I think from a dealer point of view, it's very similar. I would say that, of course, we have our service network through the dealers. But on top of that, in Construction, since it's so extremely key for our customers that we can give them fast support and then I'll talk especially on the bigger machines. We have our own service centers also.

And this is something that we -- is a necessity for us and also sometimes mobile services when we, for instance, have the light demolition robots. And that we do sometimes ourselves and sometimes together with partners. Then you mentioned the parts availability is, of course, really key, but also the competence and the technicians and how to work with it.

Service contract is also an important part on the bigger machines, both to make sure that they are serviced and maintain in a good way to have uptime or not to have downtime. So I think there are several of these aspects that we are constantly working on how to improve and also have this close relationship with our customers that is so key for us.

Perhaps on the residential side as well.

Anything to say?

Sure. So obviously, spare parts is a very big topic for us as well and providing that to our consumers, but also specifically with robotics, where we actually offer special services like the winterization where consumers send in their product, and we have our own service centers in Germany, Eastern Europe as well as Southern Europe. So we actually do the service ourselves as well.

And for me, I think the biggest eyeopening is that consumers are sending the product and not because it's broken, but to make sure it does not break down. And that is the opportunity for us in the future, how to have more maintenance service versus just a consumer experience that's not positive.

at the back?

Is Johan again here. I was curious about the Forest & Garden, you talked about increasing the share of wallet from 20% to 4% to 5% and sort of mentioned that the handheld were already at 40%. I think it touches a little bit on Henrik's question. But what do you mean? I can imagine in handhelds, you sell some fuels, I think, et cetera. Is that sort of adding products?

Or what is included in this bullet you talk about?

Yes. I mean it's in the change of specific, which I mentioned here, -- and it's really creating the whole ecosystem for what the customer needs. So it could be like you mentioned some examples, it could be fuels. It could parts. It could be accessories. I mean it's basically providing that, again, the same standard is available wherever the customer is needing it. I think that is one aspect that we need to lift across, I think, more across the full dealer network basically. So we don't have pockets of weakness. We had the same premium standards across scaling that up that we did with the change to do the same in the other product categories as well.

And that could be sort of adding partner -- third-party products to your sort of aftermarket product?

Yes. It could be using a partner-based dealer network as well to get those out yes.

Yes. And on Construction, just in the aftermarket, are you including your consumables or...

You mean the diamond tools. No. No. So that is, of course, also a big area for us with for recurring revenues and something that is very important to us. And we have diamond tools in the sawing and drilling obviously, but also in the surface preparation area with the surfaces tools. And this is a key part and something that is very important to us.

Okay. And then the SEK 4 billion in cost savings, have you said anything how you aim to split it between these 3 different businesses?

It's actually largest in Forest & Garden, given it's the largest size, but all 3 divisions have a similar, let me call it, ambition. But as I said, 35% of the total weighting of the program from sourcing, which is important to all 3, 20% design to value, 20% manufacturing, 15% logistics and 10% organizational efficiency. So all actually a very similar weighting, I would point.

Anyone else?

I had a question on -- let me see, yes, Forest & Garden. And I mean, over the years, we heard that you try to avoid retail space and now you are expanding to -- back into the retail space. What's the new game here that we should understand?

The new game is is simple. We need to be where the customers are shopping. And we will continue to expand into retail as well as online. We're going to expand in the multichannel. We need to be where the customers are.

Are the risk of being -- I mean, pricing is perhaps differently, et cetera, and the dealers are more profitable for you, most likely different mix, et cetera. But I mean, will this change your margin profile? Or how should we think about that? .

Maybe I can just say, first of all, to be clear, there is a dedicated retail Husqvarna-branded robotic range. So it would be a slightly different range to the dealer channel in that sense. I mean there will be a force overlap, but it's a dedicated retail specific set of models. .

And maybe if I can ask one last question on savings. I mean, you talked about 60% near midterm and then the rest by the end of 2030. Could we get some flavor on like '26, '27? Or are there -- can you shed some light on net impact?

I don't think we're going to go into that level of detail just yet. Of course, more transparency will come as we go into the years ahead. But I think 60% of the SEK 4 billion within the next 2 to 3 years, I think, is quite some ambition. And I think what it really clearly demonstrates is we've already started on this, the actions, the activities, they are clear. And we have to execute on those now. That's the important message. We're not talking about a hockey stick effect where this happens in the last 4, 5 years of this program. This will happen quickly in the next 2 or 3 years, 60%.

We have a question from the webcast from Adela Dashian from Jefferies for you, Maha. So if you can give an update on how the Gardena brand has been received among U.S. retailers.

Yes, that's a very good question. So obviously, the U.S. retailer have had quite an interesting year to say the least, with all the tariffs that has been coming through as well as post-COVID. And where we're seeing right now, the American retailers is their focus, and they have been very public about it as well, is to be able to offer value to their consumers. So we have seen quite a significant growth in private label and their focus has been into that space, especially this past year, and they have indicated also in their line of views that is where they're going to focus in the future as well.

The Gardena brand in the U.S. is mostly an online brand. So we are mostly on Amazon.com as well as in specialty gardening stores. We have slight presence in the retail in flow specifically. The perception has been well. We are still going to maintain our presence there as well. But it's really an online brand where we're building the brand story, the quality, the heritage, the German manufacturing. So retailers per se for us with Gardena is not as big of a topic in the U.S. like it is in Europe.

Very clear. And another question for the divisions, perhaps, if we can expect a significant innovation and new product launch that could be seen as a game changer or as a world's first. Maybe you Karin.

Could I start? Yes. We just saw some of it perhaps not online, of course. Now as I mentioned, Husqvarna Auto grinder is, of course, a really good innovation where it increases productivity a lot for our customers since they can do other things when the machine operates instead of keeping control of the machine. So if I should choose one, I would just say that self-operated floor grinder is one of them.

Good. Anything to add from you?

I mean in terms of -- you've seen some of the innovations that we're launching today, and we've also presented some -- we're very confident. These are really strong innovations and we'll deliver great value in '26 and forward. And of course, we're confident as well in terms of the pipeline that we're setting out, but that will come back to in due that.

And on the Gardena side, it's all about water savings and water management and doing it in a smart digital way. and the capabilities that are coming down the pipeline about management of large-scale environments, whether it's a garden or public spaces, that is where all the innovations are going to be coming in that space.

Bjorn?

So I can have one on the cost savings there as well, the SEK 1.5 billion that you take and do you expect. I mean that's pretty solid delivery there. So I was just wondering that SEK 1.5 billion. Is it right to think about it is that, that has to do with the 20% efficiencies, so the product out, so basically right on our old products, a potential closure of footprint, et cetera. Just to get an understanding of that SEK 1.5 billion where that would come from. Because a lot of it sourcing, design to value is more a behavioral change or cultural change of the way of working, operating what is driving the SEK 1.5 billion?

It's a number of different factors. Of course, addressing our manufacturing footprint is one of them. And we did talk about already that we would close and of course, that generates a onetime cost. I think we said some SEK 140 million cost to close the blasted manufacturing site. So that -- it's that type of thing.

But it's really a broad spectrum of costs. I mean we want to drive administration efficiency. So of course, there's impact there with complexity reduction itself, of course, generates costs as well. So it's really across the board. There's not one specific area that stands out it's in all kind of pockets of the business.

How would start logistics footprint is another key area that we're going to look at in a lot more detail, generating some 15% of those savings. So that will incur some onetime costs.

Now we have a question from the webcast regarding tariffs. So you mentioned seeing low single-digit price increases going forward. Does that include your outlook on on further headwinds from tariff?

Yes, tariffs, of course, they started to kick in around May, June time, if I remember correctly, during this year. So there is a little bit of a -- from a year-over-year perspective. There is a little bit of a carryover into the first half of the year, next year. And we expect tariffs to probably have another SEK 200 million to SEK 300 million impact in the first half of next year growth.

And then, of course, we are doing some price increases. We've already implemented price increases to mitigate a lot of that tariff pressure, but the tariff pressure will carry over into the first half of next year. I think that's really a message we want to get across. And then yes, low single digit is our price ambitions for the years ahead at least at the moment.

Do we have any final questions from the audience? No. All right. So with that, we will close the Q&A session for now. And thank you all for all your questions and also for attending here in Stockholm today. And to our online viewers, thank you for watching. There will be a replay available online shortly. So we will finish today with a to go lunch for those of you who are attending in person. It will be a mingle lunch or you can choose if you want to bring it or if you want to stay. So with that, thank you from my end. And also thank you again to the online audience.

So just to conclude now, you're running too early, save the best to last. Now just to conclude, first and foremost, thanks for joining us today. It's been an amazing morning, high energy, and I think particularly felt it out in the product exhibition area when you feel the real products we're bringing to market.

So thank you for joining us. We started the day off actually talking about the transformation journey really towards profitable growth. And I used 2 words a lot at the beginning, is focused on is execution. And the whole intent of the presentation was our but we're going to be focused in the next phase, and we're going to execute.

The strategy has 3 clear areas: operational excellence, which is our transformational cost-out. It is a fundamental fueling engine for our journey. Some of the colleagues even used the term for growth. That is our internal branding of this program. It is already up and running. Do not see it as a program that is out there somewhere. It is happening today. And I'm very, very pleased with our pipeline of savings activities. So the SEK 4 billion we are shooting for with high ambition.

By doing that, that's going to give us the investment possibility, the investment engine into the innovation that we've been talking about and into 2 amazing brands. We talked a lot today, particularly in 2 divisions, we're actually covering all 3 visions that we have an aftermarket is a key differentiating point. High barriers to entry, having so many points of sale that we have, and that's a strength that we've got to capitalize on. We will continue to do so.

For obvious reasons, really getting that closeness to the customer, the recurring revenues and really delighting our customers and solving their productivity and uptime issues. So all 3 divisional presidents started using very similar terminology there. It was preventive and proactive maintenance. That is what we will drive more and more of.

And by doing this, hopefully, we start to show we've got even more focus. And the focus is really on the product range that we have. We lifted the lid today and give more transparency, very purposely so, where 11 business portfolio units. All in different stages, some imposable growth that we need to capitalize on, so when we need to increase the profitability and somewhere we have a turnaround case, but very clear transparency.

What I do want to say is someone asked how much patience do you have, I think, is you, Henrik. We've got to do this with a sense of urgency, and I hope that comes through throughout the course of the day. If we cannot turn around these businesses, then we need to put the focus on the profitable growth. So we will do this with a sense of urgency.

And as such, today, we launched 3 new financial targets supported by 2 sustainability targets. We need to get back to growth. Hopefully, that can through very loud and clear. Some segments where we can grow beyond GDP, some segments where you can grow with GDP. We've got to get back to profitable growth, and that starts today.

Also, we have a very clear operating margin ambition. First, we've got to get to 10%. Terry described this in the midterm. That's what we're going to get to. And once we get there, we operate consistently above 10%. And that is critical to this group, and we continue fueling that engine to investing in our brands and our innovation. And last but not least, we must be more capital efficient than we've been. We start from a low base at 7%. We get to 10% and then we get to 15% through 2030, both supported by 2 strong sustainability targets that we feel are a clear differentiator to Husqvarna Group operating in our 2 industries.

So really, I hope I leave you with that strong sense of urgency, a strong sense of focus and a strong sense of execution ability to deliver on our profitable growth journey. With that, I wish you a fantastic rest of day. Thank you.

Hello, everyone, and welcome to the presentation of the third quarter results for Husqvarna Group. My name is Emelie Alm, and I'm Head of Investor Relations here at Husqvarna Group since a few weeks back. So I'm joined here in the studio today by our CFO, Terry Burke; and also our CEO, Glen Instone. So Glen and Terry will walk you through the results. And after that, we will open up for a Q&A session. [Operator Instructions]

So with that, I think it's time to start. So Glen, how do you feel standing here the first quarter as CEO of the group?

Thank you, Emelie. So I feel good. So a big honor and privilege to be asked to step in and lead this amazing group. I'm not such a new guy on the block. I've been around for some 24 years in the group, but of course, new in this position. We look forward to the next hour and taking you through our Q3 results.

So before we go into Q3 and looking back, I think it's good just to look at where we are today and some of the innovations we have going forward. I'm actually going to start top left and go anticlockwise. So last Friday, we released a press release, which talked about 7 new models when it comes to AI-led vision models for robotic, both for the residential user as well as the professional user, covering lawn sizes from 400 square meters to 8,000 square meters, so really a full assortment. This actually supports with edge detection, so precise edge detection and of course, object detection as well. So we really feel this raises the bar again when it comes to our innovation and technology pipeline around robotic lawnmowers. These will be launched in both the Gardena and Husqvarna brands.

Moving on to the bottom left now. Of course, our professional robotic solution we've been talking about for some years now. What we're really pleased about is how the demand for the professional robotics is actually really taking shape in the golf space. We've actually got some 1,500 courses where our products are present today. So the awareness of the category is really growing. A good testimonial to that actually is the recent AIG women's golf open. The fairways were completely cut by Husqvarna robotic lawnmowers, 15 CEORA machines cutting the fairways. That is the first from a truly international golf contest. So that is a really proven point when it comes to our technology is working.

Continuing the automation journey now on the bottom right, we're very pleased to launch our Husqvarna Autogrinder in the construction industry. This is where we take automation from the lawn into the light construction space, and we're really pleased with that. Orders are actually already coming in, and this will be launched for season '26. So very excited and optimistic about that solution. And last but certainly not least, really talking about our core is where we have just launched a new 50cc range of petrol chainsaws under the Husqvarna brand. Again, we're right in the middle now of our fall season and right in the middle of chainsaw season. So the timing has been perfect for this launch. So very excited about what we've got from an innovation pipeline going into season '26.

So now we'll jump into Q3. So Q3, to summarize, we actually saw a growth in our professional segments, particularly around professional robotic lawnmowers and professional handheld, both under the Husqvarna Forest & Garden as well as the Construction space. And of course, with any handheld, it normally comes with a strong support from a P&A perspective, and that has been the case. So very strong growth on the -- in some professional applications. Overall, the sales growth was actually flat in the quarter. But despite that flat top line, we managed to improve the earnings. Earnings improvement has really come by way of strong cost control and strong cost improvements, which Terry will take us through later in the presentation and also the strong mix.

So we continue to deliver on the cost savings that we've been talking about in recent periods. We do, however, see headwinds by way of FX and tariffs. And again, Terry will bring more detail and flavor on that later in the presentation. I'm really pleased to say we've continued to drive a strong cash flow, and that strong cash flow has really helped to reduce our net debt. So we continue to have a strong balance sheet and continue improving that metric. Now looking a little bit ahead, of course, we will continue announcing new innovations, and we'll continue driving the innovation pipeline, absolutely. And today, we also announced the unfortunate closure of a facility here in Sweden. That, of course, supports our continued drive towards an asset-light approach. We will outsource the production from our facility in Brastad in Sweden to external suppliers. This will bring a lower cost of some SEK 100 million, but of course, we need to then close a plant as a result.

If we just look at then the 4 metrics that we've been looking at in recent times, of course, from a net sales perspective, it was flat. However, what I would like to say is 2 out of 3 divisions have been in growth. Husqvarna Forest & Garden growing at 1% and Construction division growing with 3%. The decline came from Gardena, which declined with some 7% from a sales perspective. As mentioned, strong development in the professional segments. And actually, I'll come back to this, but a mixed sentiment when it comes to the residential segments. We do continue to see a challenging market condition in North America.

From an operating income and earnings perspective, we have improved now from SEK 53 million to SEK 140 million, so a whole percentage point of EBIT margin improvement. That again has come through favorable product mix, strong cost control and cost savings despite the headwinds that we talk about by way of tariffs and FX. Cash flow continues to be positive, and we're actually very pleased with our cash flow development. We've continued to reduce inventory. We had a strong inventory reduction in 2024, and we've continued that into 2025, and we will continue doing this. That has enabled us to reduce net debt in a very positive way. And as such, a key ratio of net debt-to-EBITDA has continued to improve.

Of course, key product segments for us, robotics and battery. Now these 2 segments account for some 22% of our net sales. It was 20% 12 months ago, and we talked about on a rolling 12-month basis. This is as a result of the strong product launches we've had, particularly in boundary wire-free technology. And we -- as I mentioned, we have a strong presence now in the professional robotics categories in particular.

So moving on to the divisions. As mentioned, Husqvarna Forest & Garden had a continued growth. We actually see a 1% growth in Q3, lower than we've been in the first half year for a continued growth. That means on a year-to-date basis, we actually see an organic growth of 4%. What is important is we saw a continued improvement in the operating margin, again, coming through from the growth aspect, but also the strong product mix as well as the strong cost savings. Husqvarna Forest & Garden division is exposed to a challenging North America situation where we do see a reduced and subdued consumer sentiment. And as with all 3 divisions, of course, we see an FX headwind as well as a negative tariff headwind. But overall, we're pleased with the Forest & Garden development in Q3. And of course, on a year-to-date basis, organic growth of 4% and a continued operating margin of some 10.9%.

What I would say maybe to give some flavor on inventory as well is whilst we've continued to reduce inventory, we see the inventory situation in the -- with our channel partners. It's somewhat normalized in Europe and a little bit higher in North America. That's probably the best way I can describe this right now. From a Gardena division perspective, after a stronger Q2, we actually saw a decline in Q3. Very, very mixed. We actually saw a growth in the watering business. Of course, Gardena is synonymous with watering, and we saw a continued growth after Q2 into Q3 of a strong watering development there. However, the other segments, hand tools and robotic lawnmowers, we saw a decline in Q3, largely the result actually of the channel inventory situation, where we see a much slightly higher position in inventory in Europe on the nonwatering categories, lower in watering, higher in nonwatering and our channel partners continue to derisk as we come out of season, of course. So very, very normal in our non lawn care season.

Operating margin was actually minus 9%, pretty flat to the prior year. So despite the negative volume development, we've managed to hold the margin more or less flat to last year with a stronger cost control, particularly in the quarter. Year-to-date basis, we actually see organic growth of minus 2% and operating margin of 10.5%. Husqvarna construction, I actually say this is the success story of the quarter. We continue to see a growth. So despite a very tough first half year, which is really North America, we've actually seen a growth into Q3. Growth actually came in both EMA, our European area, if we call it that in the broader sense, as well as a slight growth in North America. So after a tough H1, particularly a very, very difficult Q1, slightly less difficult in Q2, we actually saw a growth coming through into Q3, also in North America, a slight growth, but very, very symbolic that we start to see a growth there.

As mentioned in the beginning, we actually had a growth in our handheld assortment in construction, which is power cutters, a very key and strategic area for us. We've seen a strong growth there and the associated parts and accessories. Great cost control as well and very strong cost savings. As per the other divisions, equally impacted by negative FX and tariff headwind. Year-to-date basis, organic growth, minus 4%, and we actually increased the operating margin from 9.4% to 10.5%. So a pleasing development from the construction division.

With that, Terry, I think I pass to you.

Thank you, Glen. So here, we look at the Q3 EBIT bridge, where we have improved the result by 1 percentage point. Moving from left to right, you can see we have a positive SEK 130 million, really driven by the positive mix. As Glen mentioned too earlier, we have had good growth in the professional segment, good growth in robotics and in handheld and in power cutters. And at the same time, we also had good growth in watering. And all of those contributed to a positive mix. And here, we see a SEK 130 million improvement. Our cost savings program continues to deliver, and I think that's an important message. We have announced a couple of cost saving programs since 2023. And we continue to execute in a good way, SEK 130 million positive effect in the quarter.

There was a small price positive of some SEK 15 million and a small investment in our transformational initiatives of some SEK 10 million. Currency was actually less of an impact in the quarter, and I say only a negative SEK 15 million in the quarter because in the first half of the year, it was significantly higher. I'll come to that in a moment. Tariffs, the gross tariff impact was SEK 165 million negative impact. So that left us with a 1.5% margin. If I move on to the year-to-date, our EBIT margin moves from 9.8% to a 9.5% margin, and that's despite the significant headwinds we face with price, currency and tariffs. So I think that is important to have in mind. We do have a small positive effect through a sales growth of 1% and the mix. We've talked a little bit about the mix previously.

Robotics, for example, year-to-date is 12% sales growth. So of course, that is margin accretive, and we've had some other areas of growth such as watering and handheld. So they have played in and had a positive effect of some SEK 150 million. Cost savings, as I referred to earlier, we have now delivered some SEK 1.7 billion of cost savings in the last few years since we made the announcement of some of our cost restructuring programs. So we feel very good about the existing cost savings program. And so far this year, we have delivered SEK 565 million. Price is a negative year-to-date. We did have a small positive in Q3, but the first half of the year was negative, and that was really driven by the robotics price deterioration. And that has ultimately ended up with a net negative SEK 280 million in the year-to-date numbers.

SEK 80 million invested in our transformational initiatives. Currency, the strengthening of the Swedish crown has meant a negative impact of some SEK 280 million year-to-date, and the gross tariff impact is SEK 230 million negative, leaving us at the 9.5% margin. We have a very solid financial position, and Glen did also refer to this a little bit earlier. We have managed our working capital in a very good way, and we have managed to reduce our inventory by some SEK 1.3 billion. if you adjust for currency, that's around about SEK 700 million reduction, currency adjusted. So that's continued good development in this area. We've also reduced our borrowings on the back of very good cash flow and some SEK 1.3 billion reduction in borrowings.

Maybe one other thing to call out on the balance sheet, you see an increase in trade payables, and that is really as we now turn the curve to start to do some preseason build and ramp-up of inventory getting ready for the season 2026. Our net debt is now at SEK 9.9 billion versus SEK 12.8 billion same time last year. So we have reduced our net debt by some SEK 2.9 billion. That's a very strong message and a very good achievement during some challenging years we've had. And really, what you're starting to see now is that continued positive rolling 12 impact, and we are now at 2.2, where at the end of 2024, we had peaked at some 2.5 ratio. So it's really good to see how we see that decline and puts us in a stronger financial position.

Cash flow, another strong positive cash flow year. We had 2 record cash flow years in 2023 and 2024. And whilst our expectation was not to meet the same levels as those 2 previous years, it was still to have a strong cash flow. And as you can see, we continue with good solid cash flow and some SEK 4.6 billion positive year-to-date.

Glen, with that, I'll pass it back to you.

Thank you, Terry. So probably worth giving a little bit more flavor on the robotics category in particular, of course, a key area for the Husqvarna Group. And we've shown this slide before and we talk about having the segmentation view.

So we have 3 clear segments. We have a professional segment, which we're targeting professional users and much larger green spaces. Then we have the 2 residential segments. One more premium, one more entry segment. And you see there in the pie chart, of course, the share of our sales. So roughly 15% of our sales coming through by professional products and 85% through residential. The professional segment now actually over SEK 1 billion. So quite a milestone that we've surpassed the SEK 1 billion mark in professional robotic lawnmowers. The green arrows also are there to show how we've seen our growth. In the entry segment, it's flat. So despite what we talked about in the quarterly report that robotic lawnmowers under the Gardena brand that declined in Q3. This is, of course, Q3 is a non-lawn care quarter. So we should look at that more on a year-to-date basis, and actually, it is flat.

On the more premium end under the Husqvarna brand, we've actually seen a continued growth in a market that is growing, but we have continued to grow. And of course, at the professional end, we've grown significantly as the awareness of this category improves and increases throughout the world. And I gave some testimonials there, particularly in the golf space, but of course, equally as attributable to the municipalities and other sports applications.

So just to maybe before we round off, I think another key area that we should mention is we continue with our sustainability and Sustainovate drive. We launched this in 2015, so we're some 10 years into this program, but we're very, very pleased with our CO2 development, 55% reduction. The target at this stage was to be minus 35%. So we're way ahead of the curve in terms of our plans. So we're really, really pleased with how we're developing in terms of CO2 reduction.

At the same time, we also have 2 other key metrics that we measure. One is circular developments and circular innovations. And in the past quarter, we've actually increased that from 41 to 45. So getting very, very close to our target of 50 that we had for this year. And then, of course, empowering people, educating people, we're actually surpassing the target we set of 5 million people. So now we have some 5.5 million people. We believe we have at least helped to take the sustainable choice going forward. So very, very pleased with our progress when it comes to Sustainovate and sustainability.

So just before we open up for Q&A, just to recap again. Despite the flat top line, good growth in the professional segments, professional robotic lawnmowers, professional handheld, both Forest & Garden and Construction as well as the associated P&A, growth in watering, a subdued sentiment for consumers and therefore, some negative development from some consumer product categories. Despite headwinds from FX and trade tariffs, we've managed to improve EBIT with 1 percentage point, and that has meant we've been delivering on a stronger mix and strong cost control and cost savings programs. The balance sheet is in a much healthier position. We've continued to reduce our inventory, increase our cash flow, increase the work -- improve the working capital and therefore, improve the net debt position. And we're also very, very pleased, of course, to announce the new innovations going into season 2026. Those products actually, we're looking forward to showing you in person at a Capital Markets Day that we will have here in Stockholm in December, December 10. So very much look forward to welcoming you there.

We will then talk about the next phase. And the next phase will be a lot about focus and being bold. We've got to be much more focused on our key areas. We've got to be very clear on our differentiating factors, and we'll also be very, very clear on our competitive situation and how we need to improve there. So that is a flavor of what we will bring at Capital Markets Day in December.

And with that, Emelie, I think we should open for Q&A.

Yes. Thank you, Glen, and thank you, Terry. So now it's time to open up to a Q&A session. [Operator Instructions] So starting with the conference call. Operator, do we have any questions?

[Operator Instructions] The first question comes from the line of Adela Dashian from Jefferies.

Just a couple of questions from me. The first one, I guess, is more related to the general market environment, and we've heard of several other, you could say, maybe more prominent, not the new, but still relevant players launching products and so on. Are you seeing more intensified competition that you believe is also pulling down your sales figure? Or do you merely view this as external headwinds causing the disruption at the moment?

Should I jump in, take that? I think a very valid question. I would actually see it more as the latter. I think it's more to do with the consumer sentiment right now in the marketplace. We've always had a healthy competition, and we welcome a healthy competition, but I would really see it as a market sentiment that is driving the demand.

And then maybe to back that up, I mean, you launched several new categories yourself this year, both on the professional side and the resi side in the robotic lawnmower segment. I think at the beginning of the year, you were talking about growth in both those categories. Could you maybe explain what has turned the market more sour in the resi segment in H2? And maybe also your view going into the fourth quarter, which is a seasonally smaller one.

Yes, I took your question there has been largely on robotics. And again, I think we should look at this on a year-to-date basis. We're coming out of lawn care season in Q3, so it is a much smaller quarter. We have seen growth in both residential and professional robotic lawnmowers, strong single-digit growth on residential and strong double-digit growth on robotic mowers. So I actually think that the year-to-date position is where we need to focus. H1 is very much the lawn care season where these products are very predominant, if I call it that. So I think we need to look at it in that context. So I don't see that Q3 has changed the position for the Husqvarna Group on a 2025 outlook or beyond.

Maybe, Glen, if I can just build on that. Also to highlight, we have had a price erosion in the residential robotics. So we talk about a 12% sales growth year-to-date on robotics. If you adjust for the price erosion, the actual volume impact is quite a bit higher than that, getting close to the 20% once you start to adjust in for the price erosion. So I think that's a good signal of growth for the year-to-date numbers.

Perfect. That's good color. And then maybe lastly for me, just thinking of the cost savings programs that you've already implemented, roughly SEK 1.7 billion, I'm getting cumulative and then an additional SEK 100 million announced just now in the quarter. Does this mean that basically going into to Q4 it's evaporating a bit. So we potentially could see at the Capital Markets Day a more profound savings plan being announced. What's your view on that?

Maybe start with where we are, Terry with the savings?

Yes. So just to put a bit of context on there. We have delivered some SEK 1.7 billion. I think we announced the programs back in 2023, and there's been a couple of programs since then. But in short, we've delivered SEK 1.7 billion. We expect to deliver around SEK 2 billion in total on the existing ones, not included in Brastad. This is something separate now. So there's still around SEK 300 million to come. I would estimate roughly half of the SEK 300 million will come in Q4, and then the rest will come into H1 2026 as we finish off that cost reduction program. .

Maybe I can also -- we're talking a little bit around Q4. So maybe I can also just take the opportunity to highlight a couple of extra headwinds we have in Q4. We expect a currency headwind of some SEK 100 million, give or take, during quarter 4. And of course, the tariff pressure will continue. There's still movement with trade tariffs, so we're not quite sure yet, but we would expect tariff impact to be around the SEK 100 million as well in Q4. So there are some headwinds for sure coming into Q4 in addition to the weaker consumer sentiment.

Yes. And then I think you asked about the broader, is there more coming given that the current savings program is coming to an end. Of course, we announced a fairly small savings program today, it's SEK 100 million from a closure of a factory here in Sweden, of course, always a very sad and difficult decision to take. But we need to continue looking at the cost competitive situation of this group, and we need to continue taking cost out. So more to come at Capital Markets Day on that -- in that respect.

Just lastly, if I may, since you were so granular giving us the expectations on currency tariffs and cost savings going into the fourth quarter. What's your view on price?

The view on price, flattish. I wouldn't expect a significant improvement in price. So I would guess, flattish.

And sorry, let's jump into a question from the webcast. So on -- from Stefan Stjernholm at Handelsbanken. So he's wondering about the need for price cuts to regain growth in the entry-level segments in robotics for next year?

Stefan, I can maybe start, and Terry, feel free to jump in. So we have taken some price adjustments this year in robotic lawnmowers. We alluded to a figure, but maybe we can even be a bit more specific there. Of course, boundary wired solutions, maybe the older technology, we've had to take price reductions as they sort of come more towards the end of life. On the newer technology on boundary wire-free, this is where, of course, we need to be cost competitive and price competitive in the marketplace, and we've taken some slight reductions there. So overall, we've had around a 5% price reduction in our robotic lawnmowers this year. So I think we have actually repositioned ourselves pretty well during the course of 2025. Again, we'll continue looking at that, but I think we've taken most of the positions there when it comes to price changes.

Maybe just to add on to that. We, of course, are also understanding the cost pressures that the competition bring. So of course, we are also driving cost out of our robotic products. So we need to maintain margins as best we can. We know that, and we will continue to protect margins. And that means we also need to drive cost efficiencies on the robotics.

Yes. So operator, do we have any further questions from the conference call?

The next question comes from the line of Fredrik Ivarsson from ABG.

I have a few, but first, maybe a follow-up on the last one, just to clarify. Did you say 5% cost reduction on resi robotics overall or just for the entry models?

No, just to clarify, that was a price reduction figure we give. We have far -- obviously, we need to be much more cost competitive than that. So we have, on average, about a 5% reduction on the residential robotics price. Price reduction -- that's price reduction, not cost. On cost, price reduction, yes.

Yes. Yes, exactly. That's what I meant. And then a question on Gardena and Orbit specifically. It sounds like it is struggling a little bit at the moment. Do you have a view on the market share development for Orbit over the last years? And maybe also if you could help us with the margin development in Orbit. I think you said it was accretive to margins in Gardena in 2024. So if you could help us with that?

Can you take it, Terry?

Well, first of all, what I would say from the market position, Orbit, consumer sentiment in North America has been weak. I think it's been weak throughout the year, but Q3 was considerably weaker. But I think that's also consistent with the Forest & Garden division as well. So consumer sentiment in North America, we are seeing is weak in general. So I think market share is fairly stable, I would say, over the period of the last few years. But of course, North America consumer sentiment over the last year or so has clearly deteriorated. So I think that's that side of it. Orbit margin is trying to remember now, I think it's more or less on average with the division margins now, maybe adjusting for acquisition amortization, margin accretive slightly.

Perfect. And then on the cost savings, a bit more than half -- SEK 1.5 billion in year-to-date -- or sorry, SEK 0.5 billion, I guess, is year-to-date and then SEK 1.7 billion over the last years. How are those divided between the 3 segments? Any segment that's been more favored by the cost savings? Or is it just equal across the lines?

What's your definition of segment, Fredrik. Just trying to understand what do you mean by split?

Sorry, the 3 divisions yes, the 3 divisions.

Between the divisions. Yes, I would say it's fairly -- yes, fairly consistent. All 3 divisions and also group functions, everybody has had to contribute in some shape or form to those cost saving programs.

Okay. Good. And then just one last quick one on the tariff impact, SEK 165 million gross. How much of that have you been able to offset through price adjustments and other effects?

Yes. We've had mitigated actions of around SEK 100 million. So the net impact in the quarter is some SEK 60 million, SEK 65 million net negative.

And if we can have the next question from the line, please.

The next question comes from the line of Bjorn Enarson from Danske Bank.

I was also into price and savings. I mean looking at the next year, are you expecting to see market-driven price cuts primarily in robotics and perhaps also handhelds? Or are you expecting to see higher prices looking into next year? And if you are not expecting any positive price development, are you planning to offset that through efficiency or savings? Or what's your view there?

Bjorn, I think it would be naive of us to think there's going to be significant price increases in the marketplace next year. Of course, we always look to increase price, absolutely. So -- but I think overall, we're not going to see large price increases, 1%, 2%, 3%, 4% levels. I don't think we'll see that. So we will continue to drive price increases in some segments and may see some price erosion in others. But do not expect price erosion on a net basis. At the same time, our cost position has got to improve. I think it's fair to say we need to continue driving cost efficiencies in this group. We do see a lot of opportunities. We'll come back to this with a bit more detail at Capital Markets Day, but we need to continue driving cost improvements across the group.

And on Chinese competition, have you any view on how much volumes have come from China over the last years? How much that have increased in a little bit of a sense of a supply-demand perspective? Do you see massive volumes? Or what's your view on that?

You mean -- are you talking robotics now, Bjorn, or across the board?

Yes, exactly. Primarily robotics, but I guess, also handheld or basically where you see competition from China?

We do get access to such data. We buy market share data, et cetera, and we can see, of course, therefore, the position of some of our competitors. But I think it would be wrong of me to allude to volumes that they're bringing in or their market shares.

Maybe I think it's fair to say, of course, that in the entry segment, this 15% in the entry segment that we have the robotics section there, the Chinese have came and be very aggressive there. So there are 2 or 3 players who have gained market shares there. So they have taken a position on the entry segment. We continue to remain very strong positions within the mid- to premium and also, of course, the professional.

Do we have another question from the conference call?

The next question comes from the line of Gustav Hagéus from SEB.

This is Gustav Hagéus with SEB. Glen, congrats on your new job, well deserved. If I might stick with the robotics growing 12% year-to-date. From what we're hearing in the market by other participants, I guess the view is that the market grew about 30% during the same period this year. Is that -- does that resonate roughly with your view of the market growth?

So first, thank you. But secondly, I believe we do see a market growth. As Terry mentioned earlier, if we adjust for the price changes that we've put through this year, then maybe our growth is nearer -- is higher than we said. We said 12%, maybe it's closer to 20%, 17% to 20%. But we do see a strong market growth. And this really just supports the long-term view that this segment is growing. The awareness and the penetration levels are still low with robotic lawn care. We know that in many countries, it's still relatively unknown. So we're very, very pleased that the market continues to grow and we've continued to maintain a strong market share. Now the competition intensifies. And again, we're very, very respectful of the competition and what they bring to the marketplace. So we need to continue with our innovation pipeline and continue being competitive in the marketplace.

And secondly, I just want to come back to that comment on the volume growth. You mentioned perhaps 20% volume growth while growing 12%, so minus 8% price/mix. The general feel in the market as we take it, though, is that the mix is significantly positive in the quarter, driven by less sales of lower-priced boundary wire robots to the benefit of higher-priced boundary free models. So does that not impact you to the same extent as the market? Or don't you see a net combination of the mix and the price being positive in the year?

So maybe we should clarify a couple of things. We're probably more like 5% price adjustment, and we talk on a year-to-date basis with the numbers that Terry referred to. So that 12% total growth is a year-to-date figure. And therefore, the price adjustment should also be taken in a year-to-date context. The total market, of course, yes, there's a shift towards boundary wire-free solutions. But from a price perspective, we don't see boundary wire-free and boundary wire being in a big price difference at all. So whilst the technology is improving, the price of 1,000 square meter machine is very, very similar. So we don't see a mix upwards because of the technology change. In our perspective, us growing in the professional end, of course, is a positive aspect for us.

You want to add something Terry?

Yes, I do actually. And maybe also be mindful that we had boundary wired product for this year, which we had to be quite aggressive on the pricing to move out because, of course, we are transitioning and the market is transitioning from boundary wired to boundary wire-free. So of course, we've had to be quite price aggressive to make sure we move out that inventory and all the technology. So you have to build that into the numbers as well, have that in mind.

All right. And then on this new -- the new robot line that you're coming to the market with them. If we start with the GARDENA SILENO sense, what's the list price of that? We're hearing retailers now are pushing in Europe for enterprise or the boundary wire-free of about -- of EUR 399 price point. Is that -- are you going to be competitive in that price point with the GARDENA SILENO this year, you think?

I don't expect Husqvarna Group is going to be offering products at EUR 399. I think the brand premium and what we offer and the installed base commands a higher price and our innovation commands that. So I don't expect we're going to be down into those figures at all, Gustav. But of course, we've got to be price competitive. It's not to just put something that's not competitive in the marketplace.

Okay. But you're not willing to give us a list price for the Gardena. I think the list price for the predecessor was 1,499, right?

I see it to be slightly more competitive than that. It will be online very soon. Gustav. I don't think we fully released that, which is why I don't want to say it, but I do think we'll be more competitive than that for season '26.

And then a final one for me, sticking to the new robotic line. With the new AI vision and the new models, do you feel that you have the hardware to enable AI at the fullest? And do you feel that you've had time to train the AI to be fully competitive in the market? And also from a price competitive perspective, do you feel that you -- from what you bring with AI ambition based is price competitive?

We're very pleased with the -- if you like, with the solution we have. Of course, we've been building this for a number of years now, and this means we get more and more images and therefore, it becomes more and more accurate from that edge-cutting accuracy and object detection perspective. So we're very pleased with what we're bringing to the marketplace. But that doesn't mean we're done. Of course, we need to continue driving the innovation forward as well. So look forward to showing you these units actually in action at Capital Markets Day.

Thank you, Gustav. So another question from the webcast, switching subjects a little bit. So the parts and accessories grew strongly in the quarter. So how much of the total sales are recurring sales? And how is the progress there?

Parts and accessories for the group is around about 20% of the business, yes. And of course, it's performed well this year. We continue to focus on aftermarket. It is a key strategic area for us. Of course, the more professional we become, which we have grown our professional share over recent years, the more we generate this aftermarket and recurring income. So this is clearly a strategic area for us and definitely more to come on that in Capital Markets Day.

Thank you, Terry. So operator, do we have any further questions?

[Operator Instructions] the next question comes from the line of Johan Eliason from SB 1.

It's Johan nowadays at SB 1. Just to -- sorry for coming back very briefly on the robotic side again. Can you give an indication on your share of wire vis-a-vis wire-free sales this season? And secondly, just on the robotics, you talked about these price cuts, but you also talk about a positive margin mix impact. Would you say that all your price categories are supporting your group margin for the year? And would they also be supporting sort of the divisional margins in Gardena and Forest & Garden?

So first of all, maybe let me just start with the last part of the question on the margins. Professional robotics is margin accretive and the mid- to premium Husqvarna branded is margin accretive. So we talk about the mid-section and the premium section, they are margin accretive and very attractive to us. The entry segment, which is extremely competitive, which is around 15% of our sales, that is not margin accretive. So just to be clear on that, it's very price aggressive, and it's an area where, yes, margins are less, margins are tighter. But of course, we need to be more cost competitive. .

On the shift from boundary wire to boundary wire-free. So the market now is some 80% to 90% boundary wire-free. So there has been a very fast shift from boundary wired to the boundary wire-free. So of course, we are also managing our portfolio to reflect that and moving our innovations very much. And now we start to tail off the boundary wired products. I don't know if you've got anything to add.

Yes, I can just add to that, Johan. I think what we've seen, of course, is that acceleration during the course of the season without a doubt towards boundary wire-free. Our split today, if I just look at year-to-date, it's about 40% boundary wire and 60% boundary wire-free, but driven from a much stronger boundary wired sales products in sort of the Q1 going into Q2. But as Terry said, that has accelerated a lot. So if I look purely at the trailing 3 months, then we would be very much in line with the market.

Okay. Excellent. And then just on the tariffs, obviously, we've seen more impact of it now in the second half and you guide for the Q4. What about next year? I mean you always missed the tariffs on the big volumes of your sales into North America. Should we expect a significantly bigger tariff impact next year versus what we've seen now in the second half for the first half? Or are you being able to mitigate it so the net effect will be significantly less than one could fear?

Of course, it's always difficult to be concrete in this area because they change regular. But as what we know today, yes, of course, there will be an impact going into next year. So particularly in the first quarter, but also some carryover into the second quarter of next year. We expect some tariff pressures of SEK 300 million to SEK 400 million going into the first half of next year. Of course, we will look to offset some of that. So maybe we get to offset half of that, but there will be a net tariff pressure in the first half of next year, yes. It's probably fair to say, of course, the tariff pressure is then trailing that we get H1 pressure, but also our price increases in reaction to those tariff increases. We're also trailing the impact. So they should also come through into the first half of next year as well on a -- to offset.

Okay. Excellent. And then just on the inventory reductions, you talked about SEK 700 million in this quarter, currency adjusted. How much is related to the plant divestment in North America, where I understand some inventory was part of it as well?

Yes, there was some -- I'm trying to cut my mind back now. SEK 500 million, if I remember correctly, would be linked to the Orangeburg divestment.

Thank you. So we have another question from the webcast. Very impressive strong free cash flows. Last 3 years have been strongest in the last 20 years. I need to fact check that, but I'm sure it's right. So good work. What do you think will be possible for '26 and '27?

Of course, we need to get more to a normalized situation. the last couple of years, we have had to manage our working capital in a much more effective way. We know why we ended up with higher working capital, higher inventories with supply disruptions, et cetera. So we still continue to be focused. We still got work to do on our capital efficiency. I think our capital efficiency, working capital efficiency is some 32% now. We want to, of course, continue to drive that into the 20s percent. So still more work to be done. But of course, you have to have the perspective of, let's call it, the low-hanging fruit of some of the inventory reductions has gone now. But it's still continued good cash flow. We need to continue to stay focused on our balance sheet and need to continue with good positive cash flow every year.

Thank you. Do we have any further questions from the conference call?

We have a follow-up question from Gustav Hagéus from SEB.

More of a bigger one, but given that you're new to this position, Glen, and maybe have a slightly different view. It'd be interesting to hear your thoughts. Thinking about Gardena and the industrial logic for keeping Gardena long term as a part of Husqvarna. I mean, historically, I assume part of the rationale has been that you've been able to develop handheld tools and robotic mowing and been able to sell it at a lower price year after to -- under the Gardena brand. But as that business seemingly is declining and very fast, so in Q3 here being the driver to the decline in Gardena, although a small part, I guess, of the total sales. Does it make sense over time you think to keep this group together? Or does Gardena -- is Gardena a company that could potentially stand on its own leg if you had the opportunity to get something material back from such a spin-off or trade?

A very broad question you asked, Gustav. I think I would like to go back to the rationale for Gardena when we acquired it. So I guess, 18, 19 years ago now. Well, time flies. But of course, I believe Gardena is synonymous with watering and hand tools in particular. And we've managed to expand that range into being the choice for the passionate gardener. So much more in the residential garden. But the whole rationale for Gardena, of course, was somewhat the weather to try and counteract the weather dependence that we had in the Husqvarna business, particularly Husqvarna Forest & Garden. .

And I do believe watering and particularly in today's world where watering is key and we have smart watering, I think that's what Gardena is very much standing for and having a market leadership position there. This is where we can continue to expand much, much more than we have been. To go back to the rationale of why Gardena fits, I really believe it fits for that reason. That is a good counter weather. Product offering versus our traditional OPE products.

Thank you. Do we have any further questions, operator?

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Emelie Alm for any closing remarks.

All right. Thank you, operator, and thank you all for joining today. That concludes the Q&A session. And I would also like to remind you about to register your attendance to our Capital Markets Day by no later than November 10 ahead of the Capital Markets Day on December 10. So with that, thank you very much for today, and we look forward to seeing you in the future.