Welcome to the Beijer Alma Q2 2024 report presentation. For the first part of the conference call, the participants will be in listen-only mode. During the Q&A session, participants are able to ask questions by dialing star five on their telephone keypad. Now I will hand the conference over to the speakers. CEO Henrik Perbeck and CFO Johan Dufvenmark, please go ahead.
Good morning, everybody, and welcome to our webcast, where we today will present our second quarter 2024, this beautiful summer morning. I'm Henrik Perbeck, and with us is also Johan Dufvenmark, our CFO.
Good morning, everybody.
So we will present today the overall performance and the recent developments of Beijer Alma Group. In addition, we will discuss our reporting segments, our two main subsidiaries. These are Lesjöfors, which is a full-range supplier of standard and customized industrial springs and other wire and flat strip components. Lesjöfors is acting globally, with the majority of sales in Europe and the USA. And it is Beijer Tech, which acts mainly in the Nordics within specialized manufacturing, value-adding industrial trading, and automation in profitable niches. And Beijer Tech is also a platform for acquisitions into new industrial niches. So today we'll present what I think is a solid report, perhaps not super exciting, but in today's economy, words like solid and stable can be pretty good. We saw a second quarter with some organic growth. And overall, the group grew both organically and thanks to acquisitions.
Of course, as we have seen in the last year, the demand was still quite varied within our diversified customer base. The big picture is that the Nordic region came back as our strongest region this quarter. For Lesjöfors, I had a mixed demand picture, but came out with organic growth on the order booking side. The Chassis Spring business area has had a good year and the high season, but it slowed down towards the end of the quarter, or at least versus the strong comps from last year. Within industrial springs, the Nordics came back, as I said, as the strongest region and driver of growth, followed by the U.K. In the U.S., industrial segments were good, but deliveries to medical projects were somewhat lower. Central Europe and Asia were more disappointing with lower demand from our customers. For Beijer Tech in the Nordics, demand was generally stable.
The newly formed business area, Niche Technologies, grew together with Fluid Technology. Just like last quarter, the Norwegian market stood out as the strongest, whereas Finland was a bit weaker. We have announced two new acquisitions since last call. Firstly, Beijer Tech signed an agreement during the quarter to acquire Clemco Norge. It's a well-managed niche player that strengthens Beijer Tech's growing operations in Norway. On July 1st, so actually after the end of the quarter, Lesjöfors acquired Clifford Springs, a U.K. energiser spring manufacturer, and this strengthens our focus on this attractive product area. I will come back to these companies later in the presentation. Overall, we continue to feel that the activity level in the M&A market is good, which is interesting and creates opportunities to find new attractive companies that could strengthen our group going forward.
At the same time, of course, the economic uncertainty, including still high interest rates, leads us to a balancing act between investing for growth and the savings. Now, continuing with an overview of the group's financial performance. So looking at the performance, we see that order bookings grew by 5%, of which 2% was organic. Net revenues grew by 4%, of which 2% was organic. As I said upfront, these are not the most exciting variations on group level, but it shows some stability for our group as a whole. The adjusted operating profit was SEK 249 million, which is a margin of 13.2%, a similar level as in Q1.
While I now will move over to the performance of our reporting segments, our subsidiaries, I can also point out, looking at the pie chart, that Beijer Tech is now 33% of the group, and a year ago this was 28%. So there's some shift there. Starting with Lesjöfors. So our spring manufacturer, Lesjöfors, is organized into two business areas. These are industry, with mainly customized products to a very diversified customer base globally. The other one is Chassis Springs, and these are standardized replacement springs, sold to car part wholesalers, mainly in Europe. Order bookings for Lesjöfors as a whole decreased by 1%, but grew 2% organically. And as the currency impact was neutral in the quarter, we have here actually for the first time a negative -3% impact from the acquisition and divestments made during the year. The net revenue also decreased overall by 4%.
Organically, it was flat versus last year. Starting with the industry segment, the largest business area, growth was -3%, but actually positive organically. As mentioned, growth came from the Nordics and U.K., where Central Europe, including Alcomex and Asia, was somewhat weaker. The US market was more of a mix. The industrial segments in the U.S. grew, in fact, whereas deliveries within medical were lower than the high levels of last year. For Chassis Springs, the strong demand from first quarter continued in the beginning of the second quarter, but towards the end of the quarter, the high season slowed down. And all in all, we think it's been a good season, but in the second quarter, comps were high and revenues came in 6% below last year. Adjusted operating profit increased to SEK 193 million, with an EBIT operating margin for the quarter of 15.2%.
Moving over to Beijer Tech. Beijer Tech is, since the beginning of this year, operating in three business areas. Fluid Technology and Industrial Products are both acting within industrial trading and manufacturing. The third business area is called Niche Technologies, which includes companies with strong market positions in various industrial niches, such as building automation, waste management, and specialized machinery. Typically, these companies have other market drivers than general industrial demand. So overall for Beijer Tech, the order bookings increased in the quarter by 19%, of which 4% organically. The net revenues grew by 23%, of which 6% was organic. Within the business area, iIdustrial Products demand was overall stable. Still, demand varied across geographies. Norway is very strong, followed by Denmark, whereas Finland experienced weaker demand. Fluid Technology grew by 32%.
A part of this is thanks to the new acquisition of AVS in March this year, but also organic growth in Norway and Sweden. Niche Technologies also grew significantly here by 69%, and there is still an acquisition effect from last Q2, but also very healthy organic growth that we have seen over the last 12 months. Beijer Tech's operating result increased to SEK 68 million, with a good operating margin of 11%. I will now hand over to Johan Dufvenmark, our CFO, for some more comments on the financials.
Thank you, Henrik. Let's look further into the financials. As mentioned, the net revenue is up SEK 66 million compared to last year. Acquisitions, together with divestments, contributed with SEK 38 million and was equal to an increase of 2%. The divestment was the German company Stumpp, which was sold in December 2023. The organic growth was SEK 28 million, also corresponding to 2%. Lesjöfors' organic growth was slightly negative, while Beijer Tech's organic growth was 6%, mainly related to strong performance in the Fluid and Niche Technologies companies. Order bookings increased with SEK 83 million to 1,892 million SEK. Acquisitions and divestments together was 2% positive, and the total organic growth was as well 2%. Lesjöfors had a positive organic growth in order bookings 2%, as Henrik mentioned, and Beijer Tech almost 4%. Thank you.
Let's continue then with a short look on the segments and how they contribute to the revenue and operating result. As we saw in the previous slide, net revenue increased with SEK 66 million. Lesjöfors' revenue decreased with 47%, mainly related to the divestment of the German subsidiary, as we said on the last slide, and also a weak ending of Q2 for Chassis Springs, while revenue in the Nordics was good. Beijer Tech's revenue increased both organically and from acquisitions driven by strong performance in the last year's acquisitions as well as recent acquisitions. The adjusted operating profit was SEK 249 million. This was an increase both for Lesjöfors and Beijer Tech. In Beijer Tech, the profit increase was in line with top-line growth, this within Niche Technologies and Fluid Technology.
Within Lesjöfors Industry, operating result was, as mentioned, mixed, and the result in Chassis Springs was affected by lower volumes towards the end of the quarter. As you perhaps remember, in 2023, we had some one-off costs. The one that most affects the comparison between 2023 and 2024 was the market valuation of inventory, so-called step-up, related to the acquisition of Tollman Spring. This was SEK 16 million in 2023. In the quarter, we had one item affecting comparability, which was the finalization of the Stumpp divestment affecting EBIT with minus SEK 6 million. This makes up the difference between adjusted and unadjusted EBIT. And now to some of the key financial ratios. Just to mention a few, adjusted EBITDA is up SEK 33 million compared to last year, the difference to adjusted EBIT being higher depreciation following a number of acquisitions.
Cash flows of the capital expenditure was SEK 167 million, lower than last year, but in last year, we saw some extra release of working capital. This year follows a normal seasonal pattern where build-up of inventory and receivables should normalize during Q3. Net debt is lower than last year, mostly related to the operating cash flow since then, and last year had two acquisitions, last year's second quarter had two years' acquisitions. The two acquisitions mentioned by Henrik earlier have not yet impacted this year's net debt. The financial net improved compared to last year. Some of the improvement is related to a more efficient use of cash. Thank you, and back to you, Henrik, for a continued look on acquisitions.
Thank you, Johan. Yes, before concluding, I would like to highlight the two acquisitions we have announced since last time. So on 3rd of June, Beijer Tech signed an agreement to acquire Clemco Norge AS, which is a Norwegian supplier and retailer of corrosion protection and surface treatment to customers in the energy sector and the general industry, primarily in Norway. The company is a well-managed niche player, and it strengthens Beijer Tech's growing operations in Norway. Clemco has an annual revenue of approximately NOK 60 million, with favorable profitability, and closing on the transaction is expected later in Q3. And recently, on July 1st, so please note, this is actually after the end of the second quarter, Lesjöfors acquired the U.K. spring manufacturer Clifford Springs.
The company has a strong offering in energiser springs to the seal and valve industry in the U.K., Europe, and U.S., and this is an attractive product area for Lesjöfors to develop further. The company has an annual revenue of approximately GBP 3 million with good profitability. So with that, we also welcome John Clifford and his team, now as members to Lesjöfors and the Beijer Alma Group. So with these two latest announced acquisitions, we continue our strategy to further grow by acquisitions. And as I said, we have seen during the spring good activity on the M&A market, and we continue discussions with several good companies out there. And please note also this slide that I've shown several times. It's an illustration of the overall impact from acquisition strategy, showing the run-rate revenue and number of acquired companies. It's not showing the exact financial reported revenues. Good.
So then just to conclude briefly, our second quarter. Some organic growth in the overall, what I think is a fairly weak economy around us. For Lesjöfors, mixed demand with organic growth in the order bookings, growth in the Nordics, U.K., and in US industrial, lower volumes in US medical, as well as Central Europe and Asia. And good high season for Chassis Springs, slowed down in the end of the second quarter. And for Beijer Tech, growth driven by Fluid Technology and Niche Technologies, both organically and by acquisitions. And as just mentioned, two new acquisitions were announced. So with that, we will open up for questions.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johan Dahl from Danske Bank. Please go ahead.
Yes, good morning everyone. Just a question on margins or profitability in Lesjöfors. I was just curious to hear your view on the sort of year-on-year progression there. I guess if you adjust for the one-offs last year in Lesjöfors, earnings were slightly down. In what buckets do you explain that relatively small decline, but still a decline? Is it just chassis mix or just curious to hear your view there?
Yes, I think your question and your thinking is relevant. It is perhaps in the mix section. We have mentioned that compared to the quarter one year ago, chassis, as you see, is a couple of % down. We also have a little bit of mix in terms of the customer segments, for example, with medical. So I think, but it's fairly close to that, as you said, small difference in margin.
Would you argue that medical is a bigger impact compared to chassis or?
I would say they both have some impact.
All right. Thanks.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.
Thank you everybody for joining us this summer morning, and we wish you a great day and a good summer. Bye-bye, everybody.
Bye-bye. Thank you.