Welcome to CTEK Q1 Report 2026. For the first part of the conference call, the participants will be in only listen mode. During the Q&A session the participants are be able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to the speakers, CEO Henrik Fagrenius and CFO Thom Mathisen. Please go ahead.
Thank you, operator, and a very warm welcome and good morning to CTEK's Q1 report earnings. Today, doing the presentation is me, Henrik Fagrenius. I'm the CEO, and together with me I have Thom Mathisen, CFO. As usually, I will start with a brief recap of what CTEK is before we drill into the numbers. CTEK was founded more than 25 years ago in a small village called Vikmanshyttan in Dalarna by the Swedish inventor Bengt Wahlqvist, who made the first smart battery chargers. That's where we have built our company on those inventions. We have today two different technologies. We have our low voltage technology, and we are selling that in consumer segment, in client brand segment, in Professional for workshops, and also in power solution. The other technology that we have is for EVSE.
That's for charging of electrical cars, and we're mainly selling that into destination chargers. We have divided our company into two divisions, the Consumer divisions that are responsible for the sales to lot of different channels like e-commerce, Amazon, and normal retailers and wholesalers, and we are targeting globally markets. The other divisions is Professional division, where we are focusing on our B2B business, that is mainly our OEMs, big sport car manufacturer and car manufacturers and also for the electrical car chargers, parking operators and destination. That's also a global market for us when it comes to client brand. We are very proud that we have been chosen by more than 50 of the world's biggest and most prestigious car manufacturers. They are using our chargers and put their brands on it.
Here you can see that we are in the premium segments and a lot of our products are sold to the same customer segments. Chargers and boosters are sold in a range of different segments. Our new adjacent power solution is sold also to some of the same customers, and EVSE destination chargers is mainly focusing on parking operators and destination charging parking garage. Digging a little bit deeper into the first quarter of 2026. Despite a lowering revenue, we increased our gross margin and our profitability, and we had a very healthy cash flow, which helped our financial situation and our net debt ratio is going down to 0.8. We have also in this report said that we are doing a strategic review of our EVSE business.
The background to that is that, as we mentioned in the Capital Market Day last year, we are moving into two adjacent segments in the low voltage business, that is premium boosters and power solutions. Now, after a while when we have been working in that, we see that there is large potential for us in those segments, and we want to focus our limited resources into that. At the same time, we see despite the leading EVSE product portfolio, we see a weakening sales development. Our main market is Sweden, that is at the moment a bit saturated, there is needed to focus more in Germany and U.K., we believe that our focus could be better spent in the low voltage segment.
We are starting a strategic overview and we believe that we as a company can create high long-term value by fully focusing on our low voltage business. With the financial stable situation that we have now, we are fully prepared to invest both organically and through M&A into this field. If we look into the quarter one, we had a very good profitability and especially gross margin that comes from bigger sales, larger sales in the premium charger in the consumer segment. The consumer division growth with 9% organically, which I think is good for the market condition that is today. We see that our new products that we have introduced are very warmly welcomed by our customers, and we continue to invest in the consumer division.
In the Professional division, we saw lower sales depending on a weaker EVSE performance, but also very strong comparative quarter for the low voltage client brand, where last Q1 we had the first deliveries to a new motorcycle company. We see a lot of interest into the new new products like our CS ONE Gen 2 with Wi-Fi for our client brand customers. Long term it looks good there as well. With that, I leave the word to you, Thom.
Yes. Digging a little bit deeper into the financials, I first go through the divisions. Our largest division is the consumer, now standing for 76% of the net sales. Here we managed, as Henrik just mentioned, to increase organically with 9%, driven by the new product launches, and the positive development across several regions around the globe. We continue with a high adjusted EBITDA, which amounted to SEK 57 million or just about 40%. That is driven by both a good product mix, including the good margins on the new product launches, and also good geographical mix. On top of that, good cost control and relatively low OPEX. Continuing with Professional division, standing for 24% of our turnover this quarter. It declined organically as the reasons as Henrik just mentioned.
The continuous weak EVSE market, but also the strong comparison quarter for the low voltage part of the Professional division. By that much lower turnover, we cannot manage to keep the positive EBITDA. The negative EBITDA is purely related to the lower revenues. One of our major focus areas, for now and back in time as well, is the cash flow and CapEx going forward. We had strong cash flow this quarter. We had operating cash flow of plus SEK 61, and also after the CapEx, still, SEK 54 million in positive cash flow, net cash flow.
The CapEx, as you see in the graph on the lower part of the slide, is pretty low in the quarter, and that stems from that we just finalized at the end of last year two large product development projects and now are in startup phase where we don't capitalize in this Q1 and going into new product development projects. The 4% is not a representative value. I believe we will go to the 6%-7% as from Q2 and onwards. The strong cash flow has also meant both in Q4 and now in Q1, that we have increased our available cash and also did another amortization of SEK 50 million in the quarter.
Again, with a low net debt ratio now below 0.8, we feel that we are in a good financial situation and well prepared for all M&A activities going forward. With that, I hand over to you again, Henrik.
Thank you, Thom. Just to conclude, the Q1, despite a continued challenging market environment and lower revenue, we managed to keep up the gross margin and our profitability, and we also growed 9% in our very important consumer division. We had a lot of successful product launches, and we look forward to seeing them developing. We also then released that we will do a strategic review of the EVSE business in order to better be able to focus our resources on our core low voltage business. With the strong financial situation we have, we are prepared to invest both organically and in M&As to increase our focus there. We are following our strategic path towards our financial targets. With that, operator, I 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, please dial pound key six on your telephone keypad .The next question comes from Sofia Sörling from DNB Carnegie. Please go ahead.
Hi. Thank you. Hi, Henrik and Thom. A couple of questions from my side. Within the consumer division, you mentioned that the strong sales were driven by product launches. Would you say that it's an effect also from the premium boosters or is it mainly from low voltage?
Good morning, Sofia. We have started to launch our boosters and sold in Q1. It's maybe not a material part of the sales in Q1, but we see definitely all of our new products both in our new charger segments are very positively received by our end consumers.
All right. Do you expect rather a boost in sales from premium boosters in Q2?
The premium boosters that we so far have introduced is in the higher price end and not the volume boosters. That will come later this year or beginning of next year, depending how the development is going. Of course we expect an increasing sales of the booster, but the real boost in the booster segment will come when we introduce the volume models.
Okay, understand. Regarding product launches, do you have any new product launches during 2026?
Yes. We have a roadmap now for 2026, 2027 and onwards, so we are continuing to investing in new products. Absolutely.
Okay. Yeah, a question on the strategic review for the EVSE segment. Let's say that the result of the strategic review will be that you will divest the EVSE operation. How is that, yeah, how would that be, or my question is how integrated is the EVSE operation now in all terms of your business, and how easy will it be for you to, in that case, divest this operation?
Yeah, as we mentioned, we are just starting the strategic review now. No decisions are taken. The EVSE business is a business of its own. We have separate development department, we have separate support department, we have separate sales department. Of course, we are also sharing some functions, but I would say that it's an own business and standing by itself.
Okay. Yeah, and within the Professional division, so you mentioned a weak EVSE segment, but I can also see that the within the low voltage business is also the net sales has declined quite significantly compared to Q1 last year. How would you describe the underlying demand within low voltage within the Professional division, and how do you see that business or demand developing going forward?
Now that's correct. We had a very strong comparison quarter. Q1 last year, we made our first deliveries to a new customer, the European biggest motorcycle company, and they were filling their pipes, so that was a big boost last year. It is strong comparison figures. The Professional client brand business is a bit going up and down between the quarters, depending on when the OEMs are putting in their big stock orders. If I look at it overall, according to my knowledge, we are not losing any market shares. More the obvious opposite. We are upselling with our new models, so we are transitioning from old platforms into new platforms, which is also increasing the revenue and profit. I have a very bright view of the Professional client brand also going forward.
Of course, everything is dependent on market sentiments and how well they are selling their cars as well.
Understand. A question on the gross margin, which increased significantly within the consumer division during the quarter. What would you say is the main driver behind that margin improvement? Also how to think about that margin, is that a sustainable gross margin in your view, or is it just like a really strong one this quarter?
It is a really strong one, and it is depending on, I would say, mainly three things. We have a product mix effect, we have a regional mix effect, and we also have an effect of new products introduction. I think we're not guiding into too much of how exactly the gross margin will look forward, but I think this one is very strong. We have improved it now for many quarters, but if it will be as strong as quarter one going forward, I dare not to say.
Okay. A follow-up question on that. Given the increased sales from the premium booster, would that dilute the margin, the gross margin in your view, or do you expect to have a similar pattern as the low voltage business?
It has definitely at least a similar margin as our low voltage business.
Okay. Yeah, that was all my questions. Thank you.
Thank you, Sofia.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. The next question comes from Mattias Ehrenborg from Redeye. Please go ahead.
Yes, good morning, gentlemen. Mattias from Redeye. Obviously positive to see a strong consumer segment once again. I was just wondering a bit about the regional performance in Germany and Luxembourg. I noticed that both regions were down quite significantly year-over-year. How much of this is driven by Professional volumes or channel effects like Amazon versus underlying demand would say?
Yeah. To start with this, that we have divided DACH with separated out Luxembourg is an accounting question. We need to do that to follow the audit practice. With that, it's no big secret that Luxembourg is related to Amazon, and you can see there a decline. That is just the reason that the buying pattern from Amazon is a bit changed versus last year. The out sale from Amazon is going well. It's just a prioritization effect or the quarters. Otherwise, we can see that you also say that German market is having a little bit of a challenge this first quarter.
And we have not lost any customers, it's not that, but we have not had the best performance during this quarter. Some issues with our bigger customers, reorganization, et cetera, have impacted. Otherwise, we believe that we will see stronger quarters going forward also in Germany.
Okay. Thank you. That was a good answer. I was just wondering a bit about client branded volumes, because I noticed that in Q1 last year, you made big deliveries in Q1, I think to a German customer, if I'm not mistaken. Has that impacted the comparative numbers at all for Germany as a region?
Absolutely, yes. Absolutely. It's also a big part of that.
Mm-hmm. Okay. Thank you. Regarding market conditions in general, I know that the development in the Middle East can't be helping for sure, but regarding the end co-consumers purchasing power and risk and so on, how would you describe the demand conditions across the consumer Professional segment during this quarter? Has it changed anything during the last quarter in terms of behavior or demand patterns?
Now, we had a strong growth in Q1 in the consumer segment with 9% organically, which I think is very strong, considering the market situation. Of course, with all the turbulence what is occurring, it's not helping the consumer sentiment. In Q1, we saw a strong organic growth in consumer segment. I would say in the client brand, it the decline there has more to do with facing and a strong comparison quarter than any underlying lower demand.
Okay. As you mentioned, the consumer segment was very strong once again in the quarter. Would you say that there's been any shift, relative I mean, if you look at the first half of the quarter compared to the second half, or is it quite evenly spread?
In the quarter, I would say it is quite evenly spread.
Yeah.
Okay. Okay. Excellent. If we move over to your M&A progress, you had mentioned earlier that you have outlined on M&A strategy. Could you provide some sort of update on how this is progressing? Are you seeing solid pipeline, or have you moved into more concrete discussions, or what's the current status?
As we mentioned at our Capital Market Day, we will be looking mainly in the power solution area, and we are working on our pipeline as we speak. We are not going to reveal any how far we are in those discussions, but we are working with them.
Okay. Final question from my side. Possibly the biggest takeaway from this report, of course, on the consumer segment is the EVSE strategic review, as you mentioned. I know it's still early days, but could you elaborate on sort of the key options you're considering, and perhaps some sort of expected timeline? If that's a bit tricky one.
As you said, it is tricky, and we have not made any decisions right now, but we are doing the strategic overview. We believe that we have an extremely strong product offering, one of the absolute best destination chargers on the market, now also certified for the German market. We have had strong, or we have a strong sales organization based in Sweden, but the Swedish market are at the moment a bit saturated, so we see slower sales there. We don't see that we're losing any market share or something like that, but we see that there is a slower market.
We recognize that, in order to get the full potential, we want to investigate if there is any partner, or any other company that maybe have a better structure in Germany, U.K. to leverage on that and get out our very good products.
Okay. That makes good sense. We will continue to monitor that then. Thank you very much for your answers. That was all for me. Thank you.
Thank you, Mattias.
Thank you.
There are no more questions at this time. I hand the conference back to the speakers for any closing comments.
Thank you, operator, and thank you very much for taking the time listening in, and talk to you next quarter. Thank you very much.
Thank you.
Bye.