Thank you. Peter Nilsson speaking, and as already stated, I'm joined here on our Quarter 2 call for 2026 by Fredrik Nilsson, who is our Group CFO, and also in the room here and able to support us is also Christofer Sjögren, our Head of Investor Relations.

Presentation of our Q2 for '26, as usual, using the presentation which you can find on our web page. Then quickly turning, using this presentation, turning to page 2, agenda slide.

Normal set up for us in Trelleborg, starting with some general comments and highlights from the quarter, then also some comments on the business areas individually, our three business areas. Then also then Fredrik will jump in and guide us through the financials more in detail, and then finishing up with a summary from me, and also some comments on the outlook for the running quarter, and then finishing off with a Q&A session.

As usual, turning to page 3. Heading for our report this time: Strong Growth and Record High Margin.

Sales ended up a little bit north of 9 billion Swedish, increase of 7%, and this is the highest sales we have had for a single quarter up to date. Organic sales fairly strong for us at 8%, M&A adding another 1 percentage points to sales, and then currency headwind still of 2%.

EBITA up at 1,761 million Swedish kronor, which is then let's say, yeah, noticeably higher than last year, is also then corresponding to a margin of 19.2%, which is both in terms of absolute EBIT figure and also in terms of margin the highest we have had for a single quarter so far. Still some negative currency translation effects on

you can please continue the presentation.

We'll start from slide 1 again, please.

Yes. Sorry for this, all of us.

We were not aware that we were out of the call, and we just picked it up. As so we do a restart of the full call.

Welcome all of you to to this Q2 presentation of Trelleborg in 2026. I'm Peter Nilsson speaking, CEO Trelleborg, and joined here on the call is Fredrik Nilsson, our Group CFO, and also supporting us on the call is Christofer Sjögren, our Head of Investor Relations.

As usual, when we present our quarterly results, we're going to use a slide deck which has been on our webpage for for some time or for a few hours. That is what what I going to refer to throughout the call.

Using that, turning then to page number 2. Agenda.

Agenda. No, page number 2, please.

Page number 2, agenda. Here we're talking about the highlights, and then commenting on the business areas, and commenting on the financials.

Fredrik going to guide us through that financial part of the of the slide deck, and then finishing off with the summary and some comments on the outlook for the running quarter, and then finishing off with the Q&A as usual. Then turning to page number 3.

Heading for our report this time: Strong Growth and Record High Margin. Coming sales in the quarter, ending up a little bit north of 9 billion Swedish, which is an increase of 7% compared to a year ago, which is also to be noted the highest sales we have had to date for for a single quarter in Trelleborg.

Organic sales in the quarter ending up at at a high 8%, M&A adding another 1%, and then currency bringing us down with with 2 percentage points. That is the kind of the sales development.

If you look at the results, EBITA ending up at 1,761 million Swedish kronor, which is corresponding to a margin of 19.2%. Both of these, both the EBITA and the margin, is also the highest to date for a single quarter for for Trelleborg.

We have some still some negative currency translation effects on on the EBITA, which is bringing that down by 24, going down, but nevertheless negative. Earnings per share increasing more than the EBITA, benefiting from improved financial net and actually increasing in the quarter by 18%.

Of course, also supported by the share share buybacks, which I will comment on also a little bit later. Items affecting comparability linked to restructuring and linked to integration of M&A of some 67 million Swedish kronor.

Cash flow, solid cash flow, good cash flow, a bit north of 1.2, which is up by some 20% compared to a year ago. Good management of working capital in in a growing environment, and I mean on a rolling 12 basis, we keep the operating cash flow cash conversion above 90%.

Share buybacks continue at the same pace as been communicated before, a little bit south of 500 million in the quarter. Also in the quarter, we announced an acquisition of a company called Gomet, an Italian company Italian-based company, focusing on the aftermarket of niche automotive sealing products called boots, which is a overall our position within boots is strong globally, and this is kind of adding capabilities and adding a product range, more focus on the aftermarket.

Very good supplementary acquisition to us, which we're going to benefit from in this niche application and this kind of what we call business unit within Trelleborg. Turning to page 4.

Commenting a little bit more in detail on on the sales development in the quarter, we have, let's say, fairly solid organic growth in all main geographical markets. Europe growing by 6%, which is substantially higher than a year ago.

Americas and and Asia, both of them close to or even slightly higher than 10%. Good development in US and Asia.

We note with satisfaction as well, we have behind this 10% growth, we have good growth figures both in India in all main markets in in Asia: India, China, Japan, and Korea. Overall, summering up on 8% organic.

Good good organic sales development in the quarter, which is fairly equally spread globally as well. Page 5 on the agenda slide, commenting on the business areas.

Quickly turning to page 6 and commenting on Industrial Solutions. A solid organic growth, organic sales up by 4% and M&A adding another 1%.

Behind this is still a little bit lower project deliveries in the quarter, which we have announced before, and we keep to that guidance that we it was a little bit lower in the quarter, and we do expect that to pick up more here in the second part of of this year. We also note with this satisfaction that construction industry sales is actually showing some improvements.

It's been a fairly bad market for for quite some time, and although running substantially below the peak a few years ago, we note with satisfaction that we see the first signs of an improvement. Also good performance within Aerospace within Industrial.

We have an Aerospace exposure with on Industrial Solutions, although the the biggest Aerospace exposure within Sealing Solutions, but we also note with satisfaction that I get back to that later, it's developing very nice in Sealing Solutions and developing also nice within Industrial Solutions. Overall, this kind of boils down to an improvement, slight slight improvement, must say, in EBITA and margin, owing to higher sales volume and operating efficiency.

Behind this figure is actually slightly better as we see it, because also with it's mixed that we have mixed development within the quarter. We have had a slightly negative mix on on the sales development there, we are, let's say, happy with the development Industrial Solutions in the quarter.

Also here, of course, this acquisition of Gomet is kicking in when they've been when that being fully integrated, this Gomet acquisition which I already commented on. Turning to page 7, on Trelleborg Medical Solutions, stable organic growth.

We are growing by 2%. Some mixed, let's say, sales development with good development in Europe and North America, while Asia was temporarily somewhat lower.

Life science segment, a smaller part smaller part of of Medical Solutions, but but the focused area for us continued to develop nicely and developing in a very robust way. Slight improvement, basically on par with last year for EBITA, benefiting from this slightly higher sales, but well managed and good development overall.

We have a slight downturn, and that is mainly a mix effect, but no no big things here. Stable performance and solid performance for Medical Solutions.

Turning to page 8 and commenting on Trelleborg Sealing Solutions, yeah, we say very strong sales growth and also, let's say, with with a nice uptick also in the EBITA. Good development in most segments within Sealing Solutions.

Good development in Industrials generally, with especially good performance in in Europe and and Asia. Automotive actually growing very nicely for us in the quarter.

We are benefiting from our global global presence and global balance within this segment, and of course also, as most of you are aware, good development within truck and buses, and also a recovery in the aftermarket sales where we've been suffering a little bit the last few quarters, but that's bounced back in this quarter. Good development overall for us within automotive.

Aerospace developing very good growth on on a good on on a global theme, which is also creating good benefits for us in the quarter. Overall, very good development in Sealing Solutions, which is then, let's say, delivering a very good results where where good good very good development EBITA and good margin development, good performance overall, also creating a solid foundation for at least for the rest of the year.

Turning to page 9, a few comments on the sustainability before entering into the financials. Continue to bring down our CO2 emissions within the group, down by 19% year-on-year.

Solid development. Of course, as it gets lower, it gets more challenging to lower it further, but nevertheless it's a high priority order going forward, and we going to continue to improve, but although maybe not with this kind of we have seen in this quarter.

Same, page 10. Same applies here.

We are also another KPI on the next page, page 10, is then also share of, yeah, electricity, which is also a good good development here where we see that we are more or less now up to 100% of all electricity used is coming from renewable or fossil-free electricity. As we go close to 100, then, of course, we cannot go above 100, you should not expect to too big improvements here.

We going to make sure that we keep it on this level and and continue to deliver good good results also in these aspects. Turning to page 11, and the agenda slide and financials.

Turning over to Fredrik, who is then starting on page 12.

Thank you, Peter. Starting then on page 12, looking at the sales development.

We have reported 7% increased sales in the quarter, from 8 billion 511 million to 9 billion 161 million, which is the highest sales for a quarter. If we look on the right side of the slide, you will see an organic sales growth of 8% in the quarter, with growth in all three business areas.

Then we had 2% negative from currency in the quarter, and M&A added 1% growth in the quarter. Moving on to page 13.

Here you can see in the second quarter, we achieved 9% sales growth at constant FX, which is above, you can say, the sales growth target we have over a business cycle. As you can see here on the chart, that it's quite some time ago since we were above that target, it's nice to see that we are hitting that level.

Moving on to page 14, looking at the quarterly sales or for the rolling 12 months for continuing operations. You can see here on the rolling 12 that we reached 34.7 billion SEK in the quarter.

Moving on to page 15, zooming in on the EBITA and the EBITA margin. If we then start with EBITA, excluding items affecting comparability, we have a nice increase of 11% to 1 billion 761 million.

In the quarter, as Peter mentioned, we have -24 million SEK in negative translation effects. If we then looking on the margin side, you can see a nice increase from 18.6% to 19.2%.

This was the highest margin that we have had for a quarter. The margin improvement was due to, firstly, the good organic sales growth, but also continued operational improvements.

Moving on to page 16, looking at the EBITA and the EBITA margin on rolling 12 months. You can see an EBITA of 6 billion 430 million.

Then we had a margin of 18.5% on a rolling 12-month basis. It's an increase of 3% of the EBITA over the last 12 months, but you need to have in mind that we have had significant negative translation impacts during the last 12 months.

Moving on to some details in the profit and loss statement. Looking into the items affecting comparability, we have -67 in the quarter, and that was entirely relating to restructuring projects.

Looking at the financial income and expenses, you can see that it was lowering from 125 negative to -109, a nice improvement. The tax rate for the quarter at 25%, which is also in line with the earlier communicated guidelines.

Moving on to page 18, looking at earnings per share. If we looking at the earnings per share, excluding items affecting comparability, a good improvement from 4.31 up to 5.07, which was an increase by 18%.

That was, of course, due to the higher EBITA, improved financial net, and the share buybacks. Then if we include items affecting comparability, it was an improvement from 4.03 to 4.85.

Moving on to next page, page 19, looking at the cash flow. An improvement of 22% in the quarter, from 1 billion to 1 billion 217 million.

Then you can see here that the CapEx level has coming down, so that is a nice improvement year-over-year from the net CapEx. Then you can see an increase on the working capital side, and that is, of course, partly related to that you see the good organic sales growth.

We're tying up a little bit more in accounts receivables, and we have also temporarily built up some strategic inventory of some important raw materials to secure that we can supply with the strong organic growth. Moving on to page 20, looking at the cash flow conversion.

Very good cash flow conversion continue, and you can see here a year ago, we had 87%, and now we are ending a quarter with 96% cash conversion over the last 12 months. Moving on to page 21, the gearing and the leverage development.

We're ending the quarter with a net debt of 10 billion 31 million, and that's an increase compared to prior quarter, but please have in mind that we paid out our dividend in late April. We have also done share buybacks of 458 million in the quarter.

Then zooming in on the ratios, you can see on the slide, net debt over equity, 27%, and net debt over EBITDA has gone up to 1.3. In other words, our balance sheet remains strong.

Page 22, looking at the return on capital employed. You can see here for a year ago, it was 11.6%, now we are at 12.6%.

You can see that the trend from the third quarter in 2025 continue, and the main reason here is the higher profitability that is improving our return on capital employed. Moving on to page 30 23, the financial guidelines for the full year.

It's unchanged compared to what you saw end of first quarter, but looking into the details here: CapEx, 1 billion 450 million; restructuring costs, we expect that the year will end around 375 million; amortization of intangible assets, 650 million; and underlying tax rate should stay at current level of 25%. By that, I would like to hand back the microphone to Peter.

Thank you. Turning to page 24, back to the agenda slide, and going in for summary and some comments on the outlook for the running quarter.

Turning to page 25. Overall, we see an improved demand in a lot of our end markets, and basically struggle to see areas where we see not an improvement.

It's looking good, and we see once again most of the areas moving in the right direction. We also have, let's say, wide good development.

All business areas recorded solid organic growth, and we also see that sales in the quarter were also the highest to date for a single quarter for us. Good demand overall, both running quarter and also the way we look at the future.

Improved earnings, we also get a reasonable good drop-through on this one, this higher sales is turning into the best EBITA and the best margin for a single quarter that we had to date. Cash flow following, we are managing, we feel, we're managing the working capital in a good way in this growth environment, although let's say we are also, of course, cautious here.

We have had some uncertainty, I couldn't say that we have any problems yet, but at last, we don't know what's going to happen a little bit. Some of the raw materials, we've been a little bit careful, we're building some inventory to make sure we get both availability and also to safeguard a little bit of pricing.

That's been impacting us, but good management of accounts receivable, good management of payables. On top of that, that we having guiding before also CapEx is going down, which is also benefits.

Good cash flow, good cash conversion, above 90% looking at the last 12 months. We also continue to do the share buybacks of roughly 500 million Swedish kronor per quarter, slightly lower in this quarter, but the overall kind of guidance in relation to share buybacks is the same as before.

Turning to page 26 on the outlook for the running quarter, and we should be open here that it was a little bit struggle to get it right. We see an improved demand actually quarter-on-quarter, but also that we have, let's say, the comparative figures going into Q3 is a little bit more challenging.

You should read this that actually we see that the organic growth figure from 8 might not be 8 in the Q3. It will be a bump down on that, but we will still remain in a very positive territory.

We feel confident on the demand, and we have good order books going into the quarter. Happy to answer more questions about that, but that this is the way we would like to send a message.

Demand is solid, demand is good, demand is actually sequentially improving. As let's say if you're looking into Q3, we do expect the organic growth figures to be a tad down compared to what you saw in Q2.

Then, of course, the normal add-on. We are living in a little bit uncertain territory at the moment in terms of geopolitical situation.

Of course, things might change and things might be different, but that is cannot do anything about that, and we are ready to adjust, but nevertheless we need to add this comment to highlight the uncertainty we see around us. Turning then to page 27, and then Q&A.

Quickly turning to page 28 it is, I guess, and opening up for questions. Please, go ahead.

Good afternoon. Thank you for taking my questions.

I have three, please. Maybe just firstly on Sealing Solutions, and maybe just commenting on the margin from here.

Clearly a strong development organically year-on-year and a good drop-through, but perhaps if you could just shed a bit more light in terms of how we should think about the margin development as we head into a quarter with tougher comps. Thank you.

Starting on that one, I don't say tougher comps in that respect for TSS. We still believe we can improve from the running margin.

We expect a good demand overall, and we're running with fairly high gross profits here. If the volume continues as is, we are kind of positive also about the future.

Of course, we're not talk about another 2 percentage points or whatever up, but it's running on a good level, and we expect it to remain at this level or even somewhat better for the second part of the year.

Very clear. Thank you.

My second question is just regarding your commentary on the product deliveries. You pointed to a bit of a sequential increase in deliveries, and obviously have communicated a bigger pick up in H2.

Just wanted to clarify whether the deliveries in the quarter were in line with expectations, and then how are things developing on the demand side here?

Are you referring now to Industrial Solutions? Is that the question related?

Yes,

please. That is a long order, generally that business that we refer to is very long orders, and we know that we know the order book well in advance.

It's a very, let's say, low turn in the quarter, if I may say. That is why we feel confident that this deliveries is developed as expected and is well in line with what we guided for and believed in.

You never know. There could be some, let's say, delays in certain areas, but we don't know that at all.

It's not really a problem about availability or lack of orders. It's more a matter that the customers did not ask for the products here in the first part of the year, and we see an increased project activity here in the second part of the year.

Nothing really surprising or no challenges as we see it today.

Sorry, just on the demand side, like

the book-to-bill in Industrial Solutions? If you look at the project business, the demand is still, let's say, flat positive.

On this project part of Industrial Solutions, the main exposure is not the only one, but if you should pick someone, is LNG development and all of that. Overall, let's say the activity level is high.

Then, of course, it is always a bit bumpy on this kind of big project business. It goes a little bit up and down, and there is always a facing in the projects and all of that.

We have a, if I may say, for that business, an all-time high order book. That is more a matter of executing and making sure.

It looks good, and that's not only for the next quarter. That looks good for kind of the next year plus in that part.

It will be a little bit fluctuations in between quarters since it's kind of sizable project deliveries. Thank you.

My final question is just on pricing. Just wanted to get a bit more color with regards to development in Q2 and then just what you're seeing at the moment as well.

See, pricing, of course, a lot of, let's say, suppliers are indicating, let's say, cost ups, and there's also some freight costs going up. We are confident in managing that in a good way.

We are using kind of resourcing where that is beneficial for us, and we do, of course, also do some pricing. We believe the acceptance for price increases, well-motivated price increases, is good in a way.

We don't see a challenge in adapting for this potentially higher raw material pricing. We should say that most of this raw material pricing increase have not really kicked in yet, but also neither has our price increases.

We don't see that as a risk for us going forward on this cost inflation in relation to price increases. There is need to stay close to it and see what happens, and we adjust when we need.

We feel confident that we will be able to adjust if needed.

Thank you very much.

Great. Thank you.

If I can start on the outlook statement for Q3, you're talking about demand sort of on an underlying basis being sequentially better. Are there particular regions or end markets where you're seeing that, or is that sort of across the board?

Then you're also talking about, sort of putting that to one side, the comp impact on Q3 growth. Is there any way to think about the magnitude of that, and therefore, the potential step down from the 8% this quarter?

If we say the demand is surprisingly good more or less all over. Of course, you have some automotive pockets which is weak, if I say that, but overall, the global automotive is good, and also, let's say, truck and buses is good.

We see the aftermarket automotive picking up, there is, of course, but we don't really have this exposure, let's say direct exposure to the weak areas of that. Overall, we see Aerospace is good, semiconductors continue to delivering very well, we have the oil and gas, LNG delivering good, we see also some uptick in this what we call industrial automating, robotics, and stuff also where we see higher demand.

The area construction industry, I already commented, although on a lower level, we see slight, kind of lights in the tunnel here for both commercial and residential construction. Then the big segment for us, which is hydraulics, pneumatics, which is then driving by off-highway and agriculture, also where we after some kind of a bit challenging quarters, we see also an uptick in this.

I have to say, Alex, that it's looking fairly bright at the moment wherever you look. Now, Medical Solutions is the one, but this is bumpy on, let's say, project deliveries, should say, the start of programs and they are a little bit bumpy in the ordering.

That is what we have. That is also maybe, if I say on that, the main one of the main things here going in Q3.

If you look at our Q3 figure last year, we had, I think, 13% or something organic growth in Medical Solutions, and we did comment already then that that was kind of abnormally high. That is where we had to bring with us here now going into this quarter where we have a comp with a fairly, let's say, high So we talk about a couple of percentage points down from this 8.

We still, let's say, expect it to stay on a very solid number above our kind of long-term guidance of 4. Then whether it ends up at, if I can be very direct, if it ends up 5, 6, or 7, I don't know, but we don't believe it's going to reach 8, but we neither believe we don't see it going to go below 4.

That is kind of the ballpark figure to give some more clear guidance on that, as I understand there was some confusion or some questions around it.

That's really helpful. If I can just follow up one more on margins.

You talk in the release about pricing and sort of cost efficiencies having covered extra costs due to the geopolitical situation, and I'm aware that you're particularly proactive as a business on both those pricing and efficiency points. Was there any benefit in the quarter that you were able to sort of mobilize the company to price and to be more efficient on cost ahead of some of those raw mat inflations hitting the business, or was it more sort of a neutral effect on margins this quarter?

Thank you.

I would say it was neutral to positive, but a very slim positive, if that. Also when you have all of this kind of turbulent situation, change management gets a little bit easier, you can speed up a few actions, you can do the adjustments a little bit quicker, both in terms of pricing and kind of own cost actions.

Overall, this is not kind of an explanation on the margin, it's not an explanation on growth. We don't have, I've got some questions also on pre-buying.

We don't see any sizable pre-buying, we don't see really customers protecting themselves on pre-buying. We cannot, of course, we're watching it carefully, but we cannot really see that driving sales growth or driving the development in any meaningful way.

Then, of course, there could be individual cases, but if you look at overall development, we cannot see that being kind of any kind of meaningful impact in any way.

Great. Thank you.

Hi. Good afternoon, Peter, Fredrik, and Christofer.

Two questions for me, most of my initial questions have been answered already, but maybe just on Medical, on the slower organic growth there. Could you just maybe talk through what's driving that?

I think you previously talked about that being driven by Life Sciences, but sort of any idea what the run rate is, maybe from when you speak to customers, especially in light of the fact that you've expanded capacity, and that should be supporting organic growth?

It's not I I know you're looking at the figures and detail, and we do as well, but, this is really a small deviations here, and that's a kind of a weekly delivery here and there where people, let's say, fill up the inventory or lowering the inventory. We don't see that is kind of linked to an activity level.

I think it's been a little bit it is a little bit bumpy in Medical, I must say, and we we to look at the rolling 12 12 and more to to get the guidance. It will be, let's say, bouncing a little bit in between the quarters.

We still remain in a solid positive territory, and we we don't see that changing going forward. Now, of course, it gets tough comps in in in Q3 here, as we had a plus, was it 13 last year?

Now, of course, and that was kind of linked. Maybe we will get into a negative here in in Q3, but, that is not going to kind of influence the rolling 12 figure that much.

I cannot really, sorry on that, I cannot really give you any more guidance on it. We need to accept that this is the way it is, and we need to look more on the rolling 12 figure.

Great. Thanks.

We are not concerned. We see the development, we keep in the customers, we keep in the programs, we growing in the programs, but the customers are ordering a little bit in a yeah, they go a little bit up and down sometimes in the orders, which we honestly do not fully understand why.

Great. Thanks.

Maybe just on Sealing Solutions, +12% organic growth is pretty strong, and I know the guide kind of reflects this in the go-forward that you'll therefore have tough comparables. Could you just give a sense of if there's any actual pull-forward demand, and particularly whether +12 came versus your initial expectations going into the quarter?

Let's say the order book supported this going into the quarter. It was kind of slight acceleration in the quarter, but not really meaningful.

We had a very good order intake in Q1, we have good order intake in Q2, we feel confident also going into Q3. It's a few segments pushing.

We have Aerospace continue developing very nice, semiconductors is a lot up as well for us, although a small part of totality, but it's growing rapidly within Sealing Solutions, going developing nice way. If there is anything which is more, let's say, meaningful positive in the quarter is probably the development within this what we call hydraulics, pneumatics, which is off-highway, agriculture, where we see an improvement in the quarter.

Otherwise, it's kind of the same. A little bit slight in automation, robotics, but these two areas by both kind of hydraulics, off-highway, and automation has been a little bit negative development the last quarters.

We've been waiting for the uptick in there, and now it's kind of, yeah, we're seeing it, but it's not kind of dramatic changes. With the Sealing Solutions is very wide in exposure, it's a kind of a very wide growth in a lot of segments and also all due in also a lot of geographies.

It's kind of a broad-based growth that we see in Sealing.

Great. Maybe just one more last one just on margins.

Really strong in Sealing Solutions, but sort of flattish in Industrials and Medical versus quite strong organic growth. Could you just help us understand sort of why the drop-through was maybe less than expected in those two segments despite decent organic growth?

I commented that Industrial Solutions is slightly, let's say, You don't see it, but we guide you on that one is slight negative mix, that we have a little bit unbalanced growth in a few areas. We do expect it to be better in the second part of the year, but nevertheless in the quarter, that is why you don't really get the drop-through that we should be getting.

That is the way it is sometimes. In Medical, once again, it's a fairly small business, it's individual orders, individual customers that's driving it, and we are kind of happy as long as it stays above 20, and that is what we're aiming for, and that is what we do.

We were about 20 in this quarter, and then whether it's 20.2 or 20.4 or 20.5 is kind of very similar as we see it. That I don't know if that's enough.

No, that's very helpful. Thanks very much for taking my questions.

I'll jump back in line.

Thank you.

Hi. Good afternoon.

Just one follow-up on what you said there on the semiconductor exposure. Could you give us any sense of the current revenue run rate or share of group sales, and give some color on how that is growing, and perhaps margins as well would be very helpful?

It's a low single digit, let's say, compared to the overall group sales, but the growth rate is tens of percent in organic growth. Of course, we also looking there to be just fully transparent in that one, looking also for acquisitions, and we're doing investments.

We're expanding, for instance, our factory in China in order to support organic growth there. We have recently inaugurated a new facility for semiconductors also in Malta for Europe, and we're looking also for a set-up in US.

We are investing into that, and we're looking for a continued kind of tens of percent of organic growth for let's say kind of foreseeable future. This going to be a growing part of Trelleborg.

Of course, we're focusing on organic growth, but also, hopefully, be able to support it also with some supplementary acquisitions. It's a priority segment for us.

It's not as big as we want it in Trelleborg today, but it will be substantially bigger part of Trelleborg if you look for the next kind of 3, 5 years. That is kind of the horizon where you're going to see this growing part of Trelleborg.

Great. One more, a final one from me.

On Aerospace, the capacity investments you've been doing in Morocco, when do you see those ramping up, and how much capacity are you adding in total?

On that one, we are not only adding in Morocco is kind of little bit specific to Airbus and Safran investment here to support them locally, so that is kind of more part of a global supply chain from them and being able to deliver products to them with the same kind of quality systems and same quality control. We are investing in a lot of sites to grow with Aerospace activity.

I don't really want to give a guidance there, but we're also talking here, let's say, two-digit organic growth for the foreseeable future.

Great. Thank you.

Thank you very much, everyone. Good afternoon.

I have two questions, but related, I'll ask them together. Just around the Sealing Solutions business.

Firstly, on the margins, good incremental margins off the back of the very strong growth taking it to 22.5%, not far off the 23% level you've targeted in the past. Now that's one quarter and recognizing that TSS margins typically lower in the second half of the year.

I'm interested in the timeline you now see for getting to that 23% level. Would you see that as feasible in 2027, for example?

Then a related question, following up on your comments about the hydraulics segment, the fluid power business. I think my understanding is that you've generally outperformed the broader customer base.

It'd be interesting to get an update on where you see yourselves now versus before that market went into a slowdown. How far away are we from any peaks, or yeah, are we now above prior peaks?

That would be very helpful. Thank you.

Starting with the hydraulics, I think we are quite some way away from the peak, actually. We are not yet.

Agriculture, construction equipment improving, but the agriculture, which is another big subsegment, let's say, construction equipment and mining is kind of on a good level, mining on a top level, if I may say, but construction equipment still growing, and agriculture still down. I don't see that happening.

Also when you look at this previous peak levels, there is also quite a lot of kind of aftermarket in that part as well, and we feel that the inventory levels there is still relatively low, there is kind of a double-up, which we do expect to continue for some time. Difficult to give a guidance, but I don't feel that we are, let's say, not even close, I don't think we are close to the kind of peak on that one.

That's going to take some time before we get that fully into the books. Then talk about the margin in Sealing Solutions, we have a good development, we do expect it to continue to improve.

As you say, we are not kind of at the peak level here of 22.5%, but then whether to give guidance for individual quarters and stuff is difficult, but we do expect there is improvement possibilities. Of course, if you have 23% over a cycle, that there should be a few quarters which should be above 23 in order to get into that.

As you say, there is some seasonality, there is some differences between quarters and between the businesses, we are not seeing kind of the ceiling being 23. If you get to let's say a stable long-term margin of 23, we will have to have a few quarters which is above 23.

I don't know if you want to add something to that, but that's I think what I want to say about that one.

No, that's very helpful. Thank you very much.

Thank you. Hi Peter, Fredrik, and Christofer.

Maybe starting with your gross margin, it was record high now in the quarter, 38.5%. We've seen that you've made a very good progress on your kind of fixed cost base, and you always address your production footprint.

Looking at your OPEX cost, it has been quite sticky at 20% of sales, and my question really is if you're looking into it, and especially maybe on the admin side, which is actually higher as percentage of sales compared to other industrials.

If you're looking at the quarter, it was a little bit higher year It was higher year-over-year, but if you look sequentially from Q1 to Q2, it was more on the same level. Of course, that's also dependent on other activities that we are doing, for example, M&A projects and so forth.

That's a little bit ups and ups and down, Agnieszka, from that point of view, if you're looking at the central costs.

Yeah. No, not really central costs, more like your OPEX, more of the kind of administration costs that you present in your P&L.

We have a different set up also you can say, well, with the Sealing Solutions that we are running with a higher gross profit because we have that kind of more solution selling, which is adding more sales and admin costs. That is part of our business model, and also creating more margin on the bottom line.

It's difficult to have an opinion when you benchmark. Of course, we can always improve, and that is what we're always doing.

You see restructuring cost, and we try to get out synergies when we acquire companies, but, of course, it's different to compare other industrials who are running with a different business model.

Right. True.

Please go ahead, Agnieszka.

No, maybe if you can add a comment, it would be appreciated.

No, no, it's more a matter of I want to push on that one. This is part of the way that we are able to get a better gross profit, is of course we're adding more, especially sales costs.

We know that we having quite a lot of application engineering, we are generally bypassing distributor sales, and that means that we need to carry a higher fixed cost, but getting that back on a higher gross profit. That is always the balance.

If we cannot get the higher gross profit, then we have to lower the administration all and the OPEX. If we can get it up to a higher, we think the overall net is better in this way.

Of course, we're looking at it all the time, and we're looking of ways to improve it, and looking to become more efficient without kind of, yeah, bringing down the support to our customers in any way.

Fair point. Thank you.

Then my last question's on capital allocation. If I look at your M&A activity last year, by this time point, you completed four acquisitions.

I think this year we're running at two now. Can you just, maybe talk a bit about your pipeline?

What do you see, and what do you expect? Do you expect any deals to happen until the year-end?

Pipeline in M&A is improving. There is a lot of activity at the moment.

We are just debated here before if it will be any summer holiday or not for us, because it's a lot of activity level. Then, of course, you never know in this acquisitions on whether you're actually able to make the deal at the end.

Valuations are in some areas quite challenging, and we are not kind of willing to overpay. Private equity is back in the market, very eager to make deals.

We are, of course, here long term or forever, and we a little bit more cautious in certain areas than we feel that they are. We are losing some deals, just to be transparent.

Once again, the activity level is high, and we are confident that you're going to see us doing, yeah, a number of M&As before year-end. I wouldn't say pipeline is bigger than ever, but a number of projects ongoing at the moment is on a very high level in, yeah, historic comparisons.

Then, once again, with that said, you never know if a deal is done until it's actually done.

Thank you for the color.

Thank you very much. Two questions from me.

I'm sorry for coming back to your outlook, but normally you guide with adjustments for seasonal variations. Now you're bringing in that's the reason for somewhat weaker demand.

Also bringing in that you should probably have some more price contribution in Q3 for compensating for raw material, and also that you see better project business. Could you maybe please add some more flavor on this outlook just for me to understand what part is weaker?

Is there, as some one earlier asked about, maybe some more business on pre-buying in the quarter related to Sealing, or how should I think about this? Sorry for coming back to it.

No,

the guidance is actually, if you look sequentially, the business activity is up. If I remember the figures correct, we had a -1% in Q2 organic growth, and then we had a +3, +4 even in Q3 next year.

This is a 5 percentage points difference. Then if you're adding that to this 8, then, of course, it gets a very tough So if you take that, 8 and then 5 in difference is 3, we actually see it's going to be better than 3.

We actually see an increased activity quarter-on-quarter. That is the way we calculate, Hampus, if you didn't follow Yeah,

so

that is the way we look at this. Just to clarify, we actually see an improvement quarter-on-quarter.

We've seen improvement activity, but tougher comps means that we will most likely not be able to deliver 8% in Q3, but it will be, as we see it today, a very solid organic growth also in Q3. Then, of course, there is some positive, there is some negatives.

You're mentioning some positive, maybe a little bit more pricing, maybe a little bit higher project activity. Then we know Medical that's going to be negative because it's very, very tough comps in there.

We have a high activity level in certain parts of Sealing Solutions, which is going to be challenging to actually bring more capacity on stream. There is some negatives, some positives, but it boils down once again, there is a couple of percentage points down on organic growth compared to this quarter.

Once again, We expect a solid quarter also in Q3.

Fair enough. Maybe as a last one question on the autos, a very positive take on the quarter, you guys.

At the same time, when I look at the different parts, the OE business generally has been much tougher in Q2 than compared to Q1. From your perspective, trucking is up, I know.

Is it aftermarket that has stepped up further, or what is driving your auto business being broad-based good in the quarter given how OE business has been?

Let's say, aftermarket is up, truck and buses is up, and then, of course, we are global exposure. We still feel that the let's say Asian market is developing nicely, North America also quite okay, more sour in Europe.

Overall, most of our automotive exposure is linked to kind of global technology more than global platforms. We have very wide exposure, and if it's growing in China and growing in North America, then we grow with that, and then, of course, we absorb some lowering activity in Europe sometimes.

Overall, we feel that is a global exposure, which is fully global exposure, which is benefiting us in terms of, let's say, passenger car, automotive. That is the way

Are you gaining market share in China? Because, the light vehicle production in China is down 8% in the quarter.

I think we do that somewhat, but that we are in certain areas growing in that activity. It is the way it is, Hampus, and that is your way we can explain it.

We can only explain aftermarket is up, but we see also our kind of sales to brake systems and this constant velocity joints and all of that, it is improving in the quarter. There is some kind of probably market share gains, but overall, we feel the market is fairly high activity in most of the areas within automotive.

That is the way we look at it.

Super. Thank you very much.

Thank you.

Hi. Thanks for taking my questions.

Actually, my first question is a follow-up on the question before on the automotive recovery and also related to the recovery on construction in TIS that you also mentioned in the slides. These segments has been weak for a while, and that we are seeing some improvements.

How do you see the sustainability of the recovery based on what you discuss with your customers? How do you think these segments will continue to be kind of improving next couple of quarters?

If we say the construction segment, I don't know if you're following, in Sweden there is this company Inwido, which is kind of the biggest window and door maker, which recorded a record high order intake actually was yesterday or something, which is well in line. We see an uptick in that one, we see an uptick in the kind of house construction, especially residential construction.

That is because that's the main exposure we have within TIS, it's actually sealing profiles for windows and doors. That is where we see an uptick from low levels, but nevertheless, an uptick on that one.

Overall, infrastructure construction, if I may say that, has been on a high level for some time. We have rail expansions, we have tunnels, we have harbors.

That part of the industry has not really been down, so that is kind of developing nicely. I think that's automotive, Tim, what do you want more on that one, or what do you want to ask about automotive development, if I got it right from you?

I was just wondering how sustainable for this kind of recovery will be based on what you discuss with your customers, because these segments have been weak for a while, right?

I think automotive could potentially be, if I may say, that it was an uptick because we were boosted in the quarter by some aftermarket pick up. Truck and buses in that segment is kind of looking solid also going forward, but it could be that it was, let's say, overly positive linked to this aftermarket bounce back, but it's not a major part of Trelleborg anymore, and that is, let's say, a very small part of our exposure.

I don't know, Christofer wanted to add something as well.

Tim, last year in Q2, we fell quite significantly in the aftermarket on our brake shims due to the tariffs basically. Then the market has slowly come back in Q3, Q4, Q1, and now also in Q2.

We're basically back where we started in the aftermarket. It's more a situation where we took a big hit last summer and now are back to normal.

Understood. Understood.

That makes sense. Then a little bit follow-up on the organic growth expectation as well.

Regarding the TIS, the delayed projects which is going to deliver into second half, do you have a sense of whether it would be more in the third quarter or in the fourth quarter, given that you're expecting the organic growth in the third quarter to be slightly lower quarter-on-quarter because of base, obviously? Does that imply that it's likely for the delayed projects delivery would be more towards the fourth quarter?

We don't want to split there and we say, Tim, we need always to say that we see an improvement on that one, but it's not really It's an important part, but that is not kind of a explanatory part of TIS. It will improve, and it will be creating some positives, but not really any made a difference to the overall figures.

That is, yeah, I think the way I want to comment on that one.

Understood. Makes sense.

All right. Thank you very much.

Thank you.

I do apologize. My question's already been answered, I'll go back in line.

Thank you.

Thank you. Thanks to all of you for listening in, and thanks again for your continued interest in Trelleborg.

Happy to support you with further comments. Christofer, main contact point, and he's happy to take your calls and take your questions.

Of course, Fredrik and myself happy and eager to support as well if needed, and if we can kind of be helpful, don't hesitate to contact us. Do take care, and speak to you soon, all of you.

Thank you.