All right, good morning and welcome, everyone. It's Joel here.

Today, I will be alone running through the presentation. I will start with presenting our Q3, and then, as usual, we will finish off with some Q&A at the end of the presentation.

As you will see, I have updated the presentation format a bit. No drama, and I hope you like it.

If not, you just got to live with it because we're going to stick to this now for a while. Let's go, starting with a summary of the quarter.

As I'm sure you have already seen, we delivered an overall very strong quarter. We report sales growth of 20%, 8% organic growth, an acceleration from the already good underlying growth in Q2.

We deliver a EBITA growth of 19% and a record margin of 11.9% if you adjust for the acquisition expenses. Our EPS grew by 19% in the quarter, and we delivered a record operating cash flow of almost 2.2 billion.

On top of this, we have had a very active M&A quarter, signed four acquisitions with a combined annual sales level of around 3 billion. I will come back to the acquisitions as we talk around the divisions.

Looking into sales at the high level, total sales growth, as I said, 20%, composed by 8% organic growth, 9% acquisition growth, and then 2% FX tailwind. The acceleration in organic growth was primarily driven by strong growth in our EMEA business, coupled with continued good execution in our OEM business.

Demand was positively impacted by good weather patterns in Europe, together with accelerated demand levels for HVAC in Europe, which fueled the growth on top of the what I would call already strong underlying growth we reported in Q2. In the quarter, we also saw an uptick in the organic growth in the US, I would say in line with expectations.

As we had a bit of a messy quarter in the US in Q2, and the 3% organic growth here in Q3 was more in line with what we saw at the end of Q2 when the price turbulence was settled. As expected, no major changes to the US market.

Product side, starting with the OEM business, which continues to develop very well, 19% organic growth, overall high market activity, good execution of our order books, continue to see an active market in Europe. I would say, although activity in APAC was slower in the quarter, we continue to see a good project pipeline across that region.

With respect to the OEM business, we closed the acquisition of Refra here in the beginning of October. This will be a very nice complement to our existing OEM businesses as it will both strengthen and broaden our product assortment in natural refrigerants.

This is something we are very excited about here going forward. On the HVAC side, segment grew by 10% organically in the quarter, primarily, as I said, driven by Europe and a normalization in the US.

As mentioned, we saw good trends already in Q1 and Q2, but group figures were hampered by the extreme comps in Eastern Europe first half, which is now behind us. We saw strong performance on the majority of European markets throughout the quarter, obviously positively impacted by the strong summer that is expected to continue to drive HVAC penetration going forward.

On the commercial industrial refrigeration side, stable growth 4%, also a solid quarter on that side. Moving over to group-level profitability, as mentioned in the beginning, underlying margin of 11.9% in Q3, with 22% EBITA growth, adjusted for 30 million of acquisition expenses here in the quarter.

I would say overall solid margin, really happy about the operational performance in the quarter and the work that has been done in our network in Europe, shifting products around, which is also reflected here in our operational cash flow, which I will come back to later. Moving over to the divisions, starting with EMEA, very strong performance across the platform.

In Q3, we saw an acceleration in organic growth. Majority of the markets developed well, with larger markets in Central and South Europe being particularly strong, I would say.

Worth noting here is that the exceptional comps in Eastern Europe, as we have talked about in Q2, is significantly here in Q3, and through the improved demand levels in the quarter, the region had some positive growth in Q3. Hot summer, I'm sure we'll come back to this, but was obviously a tailwind in the quarter.

It is, however, I think, worth mentioning that July last year was also a hot month, and the big difference versus last year is really that volumes continued throughout the quarter. As all of HVAC penetration levels is low in Europe, and summers like this is potentially a catalyst for gradual acceleration of penetration in Europe, which could support a positive outlook here.

There is a lot investments needed in cooling in Europe. On our OEM business, continued to develop very well.

We have strong order books, good market momentum in our key platforms: Fenagy and Frigo. As already mentioned, we did sign Refra, which closed here in October.

This will be a strong complement under the OEM umbrella, with its proprietary technology for indirect cooling using natural refrigerants, then with an expertise in hydrocarbon-based solutions. On the margin side, EMEA delivered a record Q3 in the 12.3%, stellar execution on utilizing the network, making sure we have products available on all markets to serve our customer needs.

Very, very good. Acquisition side signed two two in the quarter: Refra, which I have already talked about, and then FG Europe as well, which is a Greek HVAC distribution business with presence across the Balkans, UK, and Turkey.

Just to clarify here, this acquisition is not closed yet as it is subject to the standard approval process by competition authorities. All in all, a very solid quarter in EMEA.

Move on to APAC. APAC had, in comparison to Europe, a slightly more challenging quarter with flat organic growth, but still with good development on the margin side, continued expansion.

Very solid development in the quarter with limited growth. Worth reminding here is maybe that Q3 is still a low season in APAC.

In Asia, we continue to see positive development, continued investment into the cold chain, and the transition towards natural refrigerants, which will continue to support our business over time. Activity on the Australian market was weaker on the OEM side after two very strong quarters, but it is project business, it is a bit lumpy, and the pipeline still looks very promising here.

On the HVAC side, we met tough comps from last year, but still relatively stable demand in the quarter. On the strategic initiative side in APAC, we launched our private label offering in Australia, New Zealand here in the quarter.

We also finally closed the Refspec acquisition in New Zealand. We also did a smaller asset deal of an HVAC accessory business in Australia.

All in all, small quarter for the region in Q3, continued solid development on the margin side, also very excited here to have our private label in the market now when we enter the high season, let's see where that will take us. Moving over to North America, it has been and continued to be an active M&A market, where we continue to drive consolidation and building out our platform successfully.

In the quarter, the divisional sales grew by quite massive 30% compared to a year ago, mainly driven by M&A. Following the relatively messy Q2 we talked about, our North American business grew by 3% organically in Q3, more in line with what we saw coming out of the price turbulence at the end of Q2.

As expected, I don't think we saw any big trend shifts in the US in the quarter, but we continue to operate very well in the stable aftermarket repair place. We continue to focus on strategic initiatives, like our private label rollout, which is going very well, our organic branch opening strategy, which is short-term weighing a bit on margin, but both of these will continue to support growth here going forward as we wait for the replace market to catch up back to trend.

On the margin side, EBITA was stable at 13.4%, in line with Q2. In the quarter, we continued to execute on the M&A pipeline.

We closed, as I'm sure you have seen, the first acquisition in the Canadian market, which is an important milestone for further expansion in that region. All in all, when you summarize and put everything together, very strong quarter, 20% sales growth, and EBITA growth 19%, 22% when you adjust for acquisition cost.

Net financials in the quarter continue to be stable despite acquisition activities, of course, on support from good cash flow generation. Tax in the quarter 24%, slightly up versus last year on country mix.

All in all, good all the way through, and we post an EPS in the quarter of 1.71 SEK per share, representing an EPS growth of 19%. Moving over to cash flow, which is another highlight in the quarter, total operating cash flow in the quarter almost 2.2 billion, which is the highest operating cash flow ever generated by Beijer Ref in a single quarter.

Here, really pleased that our continued efforts to drive our capital efficiency continues to pay off. For those of you who remember our Q2 call, I said we lacked a bit of cash flow in Q2 on the AR side in the quarter due to sales pattern, that I expect that to come back here in Q3, which it did.

All in all, very very good development, and rolling 12-month operating cash flow is now at 4.6 billion. Leverage side, I would say despite acquisition activities in the quarter, our leverage ratio came down 0.2 turns here sequentially in the quarter to 2.0.

Balance sheet still in very good shape to continue to execute on our deal pipeline. From here, I expect another strong cash flow quarter in Q4, as we, as always, collect the accounts receivable from the high season in Europe and we'll continue to drive down inventory.

Summarizing Q3, another record quarter: overall growth 20%, accelerated organic growth of 8% above the already strong growth in Q2, with continued good trading throughout the quarter; very strong demand in EMEA on the back of the summer, and what we believe is an uptick in underlying HVAC demand. As already said, HVAC penetration in EMEA is low, and although not changing overnight, there is a lot of investments required across Europe, so that feels pretty good on our side.

OEM business continues to develop well, very strong order books and high activity levels. On the US, no major shift in the market, but strategic initiatives running very well.

Private labels continue to grow at a good pace. We will continue to expand our product portfolio and build out our branch network.

EBITA margins developed well, 11.9% adjusted for acquisition costs, which is the highest margin ever in the Q3. Cash flow, very strong.

All initiatives on capital efficiency is running well, resulting in strong balance sheet. Q4, as I said, is in front of us, which is another seasonally strong cash flow quarter.

Then you have the acquisition, good execution on very strategic deals in the quarter. As I said, we did sign and close Enertec early August, expanding footprint into Canada.

We signed the acquisition of Refra, strengthening the OEM portfolio. That acquisition closed here in early October.

Then we also signed an agreement to acquire FG Europe, which I talked about. This transaction is not closed yet.

Finally, we also did a smaller asset deal, HVAC accessory business in Australia, and we finally closed on the acquisition of Refspec in New Zealand. All in all, very active quarter, very strong quarter.

Really pleased with that. With that, my presentation is concluded, and I will open up for questions.

Good morning, Joel. Thank you so much for taking my questions, and congratulations on a strong quarter.

On the EMEA development, obviously, the hot summer here was a tailwind, as you say. I guess as we now move into the low season, on the one hand, I'm sure a lot of people are thinking about the investments needed for next summer, especially if inventory levels have been depleted and so on.

On the other hand, it is the low season, and you are a sort of like a daily trading company. How sustainable is these sort of growth levels going into Q4 and also Q1 before the high season picks up again next year?

Thanks for the question, Adela. I think a little bit difficult to give a scientific answer to that question, but obviously the hot summer helps.

The system breaks and all that we normally talk around. Clearly part of the growth was short-term weather-related, but what I tried to allude to a bit during my presentation is that we saw really good growth in EMEA HVAC throughout the quarter, and I don't think a month like September is directly impacted by heat in that month.

I believe there is a fair amount of growth coming from an uptick in sentiment around HVAC penetration-driven growth. As you said, maybe a bit anecdotal, but I think there is a lot of people and businesses out there that really suffered in Central Europe this summer, and maybe have started thinking about getting cooling in place for next summer.

I don't think it's completely outrageous to guess that summers like this will be more common as time go by. Yes, we are entering low season, but it was also low season last year, the that's are the numbers we will compare against.

I think we still have a positive outlook on Europe.

That's very clear. Thank you.

Maybe if I may, just another tailwind that is potentially emerging. There's already a lot of buzz about energy prices, and you did really benefit from the energy crisis post-pandemic.

Could that potentially also drive incremental growth in Q4?

I think we have spoken about this before. I think, yes, if you look back at 2022, it was very positive.

I think energy price levels was still quite significantly different back then. I guess there is two two two sides of this argument.

I guess one side is that it will affect the consumer on the affordability side, but, of course, I think the electrification trends is strong. I think the jury is a little bit out on that, but I'm still cautiously optimistic, I would say.

Great. Moving on to North America, this was a quite nice recovery in the third quarter against a still muted market.

Is this now here to stay, or are you already seeing an inflection point? Or yeah, how are you reasoning around North America and demand?

I would put it like this. I think as we tried to communicate in Q2, which obviously was a somewhat of a weak performance on our side, we had a lot of troubles in Q2, as we did speak substantially about.

The season started late, and then we had the price turbulence and so on. I think what we saw already in Q2 is that the underlying market is relatively stable where we are playing, and I think that is what we're seeing here in Q3.

No major changes in any direction, I would say, more of a reflection of where we stand. I think there is no reason to be pessimistic on the US market, but I don't think there will be major uptick short-term either in terms of replacement demand, given where we have interest rates and so on in the quarter.

As I said, we continue to drive our initiatives on private label, building out our branch network. I think we feel pretty good about the US as well.

Then if you look a little bit longer, I think despite sort of the interest rate environment, I think there is some optimism in the market on deferred replacement demand picking up at some point here.

All right. Then lastly, on margins specifically North America, what sort of drag should we anticipate with the recent acquisition in Canada on the margin levels?

No, it's good profitability in that business, shouldn't pose any drag from that. Shouldn't be anything to worry about on that side.

Great. Thank you.

I'll step back in the queue.

Yes, hello, Joel. Thanks for taking my questions, and nice to see a great report.

Maybe if we start with, I think you commented on this one, but mentioned also that September usually isn't affected by the heat wave. If you can comment on the monthly shape through July, August, and September, and yeah, what was the September exit rate organically in EMEA?

I don't want to give that specifics, but in Europe, I think I've talked about this before as well. It is in general from educational purposes, I guess.

Starting from January to July, it's gradual increasing sales all the way through, and then you have quite big drop in August from holiday periods and so on in Southern Europe. On the total sort of volume side, August and September is clearly below a July type of month, clearly.

We had similar type of growth profile throughout the quarter here in Europe.

That's clear. Also if you can comment on the price-volume mix in EMEA.

It's relatively limited on price still, absolute majority of the increase here in the quarter is volume-driven growth.

Great. Thanks.

Then on the US, first private rollout, what's the plan there in Canada through Enertec? Also if there's any comment on the regulatory landscape in Canada versus the US.

Then also if you maybe can mention something about quantifying the new branch drag in millions, and comment on how many branches you opened in Q3.

Yeah. Let's see if I can try to remember and cover everything, but obviously Canadian acquisition very interesting for us, a new country, a new platform, new territories to explore.

I think worth knowing here and understanding is that the Canadian market is, in comparison to the US, really a ductless market, more similar to the European HVAC market. Obviously private label is part of the plan here, which is we have the full product platform already in Europe, really, really good opportunities on that side.

Then if we talk about the US, I'm not going to give exact numbers, but I would say you should probably think around sort of the investments we do in branches. We have done three so far this year, with a good pipeline here for Q4 and onwards.

We're also invest in our private label. We build out a distribution platform, and we do put up investment, of course, in both product and purchasing organization and so forth.

I would say, yeah, a couple of points, 0.2, 0.3 weighing on the margin here in Q3.

That's clear. Thanks for the answers.

I get back in line. Thanks.

Yeah.

Hi, good morning. Yes, thank you for taking my question.

I have several questions. The first one relates to the HVAC in Europe.

Can you remind us how much of your business can be linked more to the fixed versus portable air-con, and how much of it therefore is related to replacement versus new and the spare parts aftermarket? The second question relates the change in refrigerant, basically the shift from R-32 to R-290 in Europe on heat pumps.

What's your view on it? Can you sell in 2027 the stocks of R-32 that you will have at the end of the year, and how are you managing the transition?

Lastly, the last question is about if you see any good brands probably adding to your super supplier list in the HVAC business into 2027. Thank you.

All right. You have to remind me again here if I lose something, but the first question, I think, is very simple.

We are very, very, very limited on the portable side, it's not a segment we operate in, really. It's a negligible exposure on that side.

With propane on the heat pump side, as heat pumps is on the air-to-water side for us, it's very relatively limited exposure. Yes, we will obviously offer the propane type of solution as well here going forward, but we will also run with our current inventory on the R-32.

I think the last question on brands, I think we have a very stable and good brand portfolio within Beijer Ref, not strategically looking to add brands right now.

Thank you very much. Just a last one if I may, on the margin erosion in North America, can we attribute this just to the acquisitions done?

Sorry, you broke up a little bit. I didn't hear.

Can you please repeat?

No, just on margin erosion in North America, can we attribute this low margin year-on-year just to acquisitions?

No, I wouldn't say so. I think margins in the US depends on how long you have followed us, but if you look back at our margin in the US between Q2 and Q3, it tends to move around a bit.

Sometimes Q2 is higher, sometimes Q3 is higher in dependence a little bit on how volumes and working days fall between the quarters. If you compare against last year specifically, I think there are a couple of explanations, really.

The bigger one is clearly connected to volumes. Last year, we grew about 6% in Q3 in the US.

Then on top of that, what I said before, we do prioritize in this type of environment to invest in growth for the long term. We obviously have some extra cost connected to our strategic initiatives on the branch rollout and building out our private label with some cost and investment connected to that.

That will be the main thing. All in all, I think we continue to feel very good about the US.

Our part of the market continues to feel stable, and we do have a lot of faith in this strategic initiatives. As I said, although weighing a bit of margin on short term, but that will support organic growth going forward here, waiting for a stronger replace market.

As I also mentioned, I think there is some reason for being optimist on the third replacement demand picking up at some point here in hopefully somewhat nearer future than interest rates coming down.

Thank you very much. Very useful.

Yes, good morning all, and good morning, Joel. A couple of questions from me.

I think the first one was, you did mention that organic growth was driven by volumes largely. Can you help us understand what the price contribution was, and is that consistent across regions?

It is relatively consistent actually, but for different reasons, I would say, if going really into the details. If you look at EMEA, I would estimate price impact to be maybe around 2% in the quarter.

I think we see similar price-mix tailwind in the US, but I think the market in general in US have seen a little bit of a trade-down in terms of pricing on the products, and not the pricing, but the price of the products. Although maybe underlying price increases are higher in the US, I would say the average sales price is probably around the 2% to 3% percentage point mark.

In APAC, as we're just entering the high season here, haven't seen any price increases for a while, but I think it will come in here in the same magnitude going into to Q4 when the high season is starting.

Very clear. Can I ask about the M&A pipeline specifically in North America?

Are you seeing change in availability or valuations right now?

No, we have worked on our M&A pipeline for a long time, as we have communicated. We do tend to favor, of course, doing proprietary deals.

Pipeline looks good. Of course, as always, now we have had a very strong quarter here converting M&A, but I think it looks very good going forward as well.

No material changes to what we do or any updates on the market.

Got it. Lastly, could I be cheeky and ask if the double-digit growth in Europe has continued in October?

I think we saw, as I said, good growth throughout the quarter. My view is, it is very early days still here in Q4, but I think trading have started well in October as well.

Amazing. Thank you very much.

Good morning. I just had two questions.

It's on the French market. Back in the day, that used to be a very significant market for you, I guess, or I appreciate that exposure has been reduced over time given M&A and so forth.

What's happening there over the last couple of weeks, and bond rates going through the roofs and so forth, are you seeing any impacts from that already now, or is that just too early days?

I think it's a good question, but I think it is a little bit too early days on it. I'm not obviously super close to all the markets.

I haven't heard any specific complaints from the organization in France, but obviously I follow the news just as you do. Let's see what happens, but I think it's too early to have a firm view on that.

Sure. Then secondly, I also wanted to ask, I guess that goes for both France and the UK, but there's been a couple of hacker attacks on certain refrigeration equipment over the last couple of weeks and months, I guess.

Is that an opportunity for you? I think the brand that's been impacted is something that you don't sell for, and could you talk anything a little bit about that?

I obviously have those news as well. No direct impact on Beijer Ref in any shape or form that I'm aware of.

I'm not sure I would like to classify it as an opportunity, but we monitor the situation clearly, but I'm not super close to it.

Okay. Thank you, Joel.

Thank you.

Yes, hello again. Just following up on APAC commentary here, given the lower project volumes, could you just remind us what developments were looking like last year in Q4, because organic growth did decline.

Did you have similar developments back then as well?

To be honest, I don't have the Q4 numbers here in front of me right now, but I think the market in the APAC region, as I said here, we have had relatively good growth last year, primarily on the HVAC side. It is a market which partly similar, I would say, to the US.

In Australia, is running on relatively high interest rates, I think the development is stable for us in the quarter, and now going into to the high season. I still think there is some optimism there, but it's a little bit challenged on the housing side of the Australian market.

All right. I see.

Thank you, Joel.

All right. Thank you, everyone.

Thanks for good questions, and enjoy the rest of the day. That's it for me.

Thank you very much. Have a great day.

Bye.