Welcome to the Bilia Q2 report for 2026. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound five on their telephone keypad. I will hand the conference over to IR, Carl Fredrik Ewetz. Please go ahead.
Thank you for the introduction and welcome to Bilia second quarter results presentation with CEO Per Avander, CFO Kristina Franzén and I, Carl Fredrik Ewetz. We're happy to present a good set of figures, strong cash flow, and an even more solid financial position than last year. Here's our agenda. We will start with the current situation in the industry, followed by Q2 numbers. Kristina will go through the financial situation and I will conclude with our outlook. Let's start. I'll leave the word to our CEO, Per.
Thank you very much, Carl Fredrik. The improvement in demand we saw in Swedish new car market at the end of Q1 has continued in Q2. The interest from private customers is also higher for new cars compared to last quarter and last year. In Norway, we had a strong finish in Q4 due to changes of tax situation and because of that, January and February this year had weak order intake on new cars. In this quarter, the demand has picked up a lot compared to last quarter. In Western Europe, demand remained stable throughout the quarter. Many of our brands have strong campaigns, big discounts, and attractive private leasing offers. Because of this, our feeling is that we are experiencing a push market in all our countries. The demand for used car in our countries was on a normal level except in Norway.
In Sweden and Western Europe, prices for electric cars have stabilized on a slightly lower level and therefore we saw better demand in these countries for fully electrical used cars. In the Norwegian market, there is a wide selection of used cars, but our stock situation is on a balanced level, both in Norway and in our other countries. There was a good and strong demand in the service business in Norway and Western Europe with good booking times. In Sweden, we saw slightly better activities compared to the previous quarter, which was a little bit on the low side. Part of the explanation is some years of lower new car sales and export of young used cars. The total car market in Sweden 2025 was almost 20% lower compared to an average market the last 10 years.
During this period, there has been a shift in the car population to more older cars. Net turnover was somewhat higher compared to last year. We report a result of SEK 411 million, with a margin of 3.8% compared to SEK 348 million last year. We had mainly higher profitability in Sweden and Norway coming from our service business. In Western Europe, the higher result is related to the used car business. Earnings per share increased to SEK 2.50, improvement of 20% compared to last year. On this slide, you can see the Q2 profitability from 2020 to 2026 in each of our countries. On the left-hand side, you can see the stable performance in Sweden. On the right-hand side, you can see the Western Europe, the best Q2 ever. In the middle, you can see Norway performing better and better since a few years ago.
On this waterfall chart, you can see the different business areas. As you can see, we improve the earnings in the service business significantly. I will also like to clarify, for the fuel business, the quarterly results included a negative one-time item related to tax changes for fuel. We are moving over to the important service business. Our service business represented 70% of the earnings in the quarter, and we improved the result and the margin. We reported a result of SEK 323 million compared to SEK 252 million in the same period last year, and the margin increased from 10.4% to 12%. The main reason for this is improvement of profitability in Sweden and Norway. We also had a positive organic growth in the group of 5%. There are several reasons why we report a higher result in Sweden and Norway. One is higher efficiency.
Another is more delivery of new cars. A third, we had one working day more in Sweden and Luxembourg, and another is our dismantling business performed well. The order intake on new cars, adjusted for acquired and divested operation, was 29% higher compared to Q2 last year. As I mentioned, we have seen better activity in all our countries. For the car business, we report a result of SEK 141 million compared to SEK 136 million last year.
The profitability for cars was related mainly to Sweden and Western Europe. For used car, we report the result of SEK 65 million compared to SEK 61 million last year. As I mentioned in the beginning, the stock of used cars is on a good and balanced level in all our countries. The reason for the higher earnings were Sweden and Western Europe, but in Norway, the result dropped due to aggressive new car pricing.
Like we said, in quarter one, prices of fully electric cars have stabilized, and we can now see slightly increased demand. We have increased our underlying backlog of new cars by approximately 4,700 units, and today we have 16,600. This is, in a historical perspective, a high level. As we mentioned in quarter four and quarter one, some of our brands have launched interesting EV models with long range, attracting lots of interest from our customers. Okay, over to Kristina and the financial situation.
Yes. Thank you, Per. For this quarter, we reported a strong operating cash flow of SEK 546 million generated by the underlying business. As a result, cash flow for the first six months was broadly in line with the corresponding period last year. As we have highlighted in previous presentations, cash flow remains a key focus area for us and will continue to be a priority going forward as well. Our net financial expense amounted to SEK 79 million during the quarter, representing an improvement of SEK 5 million compared with the same period last year. This improvement was primarily driven by lower interest expenses on our interest-bearing debts. For the first six months, net financial expense was SEK 27 million lower than last year, again reflecting reduced interest expenses on interest-bearing debt, but also higher income from associated companies.
At the end of the quarter, net debt, excluding IFRS 16 liabilities, amounted to just below SEK 2.4 billion, approximately SEK 100 million higher than year-end. Our net debt to EBITDA, again excluding IFRS 16, was 1.3x , unchanged from December 2025, and an improvement from 1.4x at the end of the first quarter. Consequently, we remain well within our financial target of maintaining a leverage ratio below 2x. At quarter end, approximately 660 million SEK of our available credit facilities were utilized. Total committed credit facilities now amount to SEK 3.1 billion, following the signing of an additional SEK 800 million facility with our existing banks. This facility serves as a liquidity backup, providing additional financial flexibility to support future growth opportunities and also to navigate potential uncertainty in the global economy.
During the quarter, we paid the first installment of the 2026 approved dividend amounting to SEK 138 million, corresponding to a total dividend of SEK 6 per share. This dividend is distributed in four equal installments, with the fourth and final payment scheduled for January 2027. In summary, our financial position remains strong, supported by solid cash generation, moderate leverage, and a good liquidity. With that, I hand over to you, Carl Fredrik.
Thank you for that, Kristina. Starting with our service business, I repeat what Per said. Our service business represented 70% of our operating profit in Q2. We continue to identify opportunities to enhance efficiency across our service business while further strengthening the customer experience. Over time, higher new vehicle registrations contribute to a larger installed vehicle base, creating additional demand for maintenance and repair service. We anticipate a stable market environment for the service business in the next quarter. Moving over to the car business. The demand for used cars was slow at the beginning of the year, but has since picked up. We expect demand for used cars to remain at a rather stable level, this except Norway, in the coming quarter, especially for electrical vehicles.
This comes as an effect of the fact that prices for used electrical cars have stabilized on an, what we believe, attractive level. Our used car inventories are at healthy levels, and our intention is to keep that status in the coming quarter. Looking at new car sales, demand from corporate customers has remained consistently stable, and we expect this trend to continue. A continued macro uncertainty, we do see continued decent demand among our brands in the coming quarter. The introduction of several new-generation electrical vehicles with extended driving range is expected to broaden customer appeal and contribute positively to volume in the coming quarter. We remain committed to strengthening both profitability and operational performance across our existing operations. The efficiency program launched last year continues to progress according to plan and is expected to deliver the results as previously communicated.
Maintaining a strong focus on profitability, cost control, disciplined capital allocation remains a key priority throughout the organization, like Kristina also said earlier. We're very proud and happy to present such a solid set of figures, but we would like to emphasize that the current environment in the industry is very tough, and our organization works hard to deliver. Strong together, combined with an attractive core brand portfolio, we are well-positioned for the future. We remain humble in our outlook but are encouraged by our ability to continue outperforming the market. Through disciplined execution, a strong customer focus, and the dedication of our employees, we believe we can continue to perform well compared to the overall market. This finalizes our second quarter presentation, and we can now 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. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no questions at this time, so I hand the conference back to the speakers for any closing comments.
Thank you very much for listening. It seems like it was crystal clear, so we're grateful for that. Best wishes for a happy and relaxing summer. Goodbye.
Goodbye.
Bye-bye