Garo (GARO) investor relations material

Executive summary

• Net sales for Q2 2026 increased 2% year-over-year to SEK 272.3 million, driven by growth in Ireland and the UK, while overall profitability declined due to non-recurring costs and weaker margins.

• GARO Electrification, accounting for 80% of sales, grew 5% in Q2, but EBIT margin fell due to higher costs and currency effects; GARO E-mobility sales declined 7% and remains under strategic review.

• Strategic initiatives, including production consolidation, organizational changes, and subsidiary integration, are underway to improve efficiency and profitability.

• New CEO Tobias Byfeldt introduced, emphasizing customer focus, operational clarity, and leveraging long-term trends in electrification and energy transition.

Financial highlights

• Q2 2026 net sales: SEK 272.3 million (up 2% YoY); adjusted EBIT: SEK -17.1 million, impacted by higher costs and one-off items.

• GARO Electrification sales grew 5% to SEK 215.8 million; GARO E-mobility sales declined 7% to SEK 56.5 million.

• Gross margin declined due to product mix, campaigns, and currency effects.

• Stable cash flow from operations, with SEK 13.3 million generated in the quarter.

Outlook and guidance

• Structural changes are expected to generate annual cost savings of at least SEK 50 million, with most savings visible by year-end.

• Management remains confident in Electrification's profitability improvement by autumn 2026, while E-mobility is under ongoing strategic review.

• Swedish residential construction market anticipated to recover gradually during 2026.