Strong growth for Medical Solutions but continued low volumes in Integrated Solutions

First quarter of 2023 in brief

• Sales totaled SEK 2,476 million (2,879)
• Operating profit (EBITA) was SEK 193 million (267)
• EBITA margin of 7.8% (9.3)
• Profit after tax was SEK 136 million (201)
• Earnings per share, basic and diluted, were SEK 0.50 (0.75)
• Cash flow after investments amounted to SEK −46 million (−41)

“Adjusted for currency, sales decreased by 20% in the first quarter of 2023,” said Nolato’s President and CEO, Christer Wahlquist. “Net sales were positively affected by growth in Medical Solutions and Industrial Solutions, but lower volumes in Integrated Solutions had an adverse impact.”

Medical Solutions sales for the first quarter amounted to SEK 1,324 million (1,088); adjusted for currency, this was an increase of a strong 13% in relation to a relatively weak quarter last year. Operating profit (EBITA) was SEK 132 million (106), with an EBITA margin of 10.0% (9.7).

“This business area accounted for two-thirds of Group earnings in the first quarter,” noted Christer Wahlquist. “Most market areas experienced good growth, apart from in vitro diagnostics (IVD), which remained at an unchanged level compared with the same period last year.”

Integrated Solutions sales amounted to SEK 414 million (1,140), which, adjusted for currency, was a decrease of 66%. Operating profit (EBITA) was SEK 22 million (123), with an EBITA margin of 5.3% (10.8).

“Consumer electronics volumes were roughly as previously announced,” said Christer Wahlquist. “Most consumer electronics customers were affected by reduced demand from end customers, which, together with a change in the sourcing strategy of a significant customer, resulted in materially lower volumes in the quarter. The EMC business continues to perform well, however, accounting for over 40% of the business area’s sales in the quarter.”

Industrial Solutions sales amounted to SEK 740 million (653); adjusted for currency, this was an increase of 7%. Operating profit (EBITA) was SEK 46 million (40), with an EBITA margin of 6.2% (6.1).

“Automotive volumes increased and supply chain disruptions had less of an impact than previously,” noted Christer Wahlquist. “Demand for products supplied to customers in the consumer discretionary sector was slightly lower, and this is expected to continue in 2023, due to weaker economic conditions and more restrained consumer spending.”

“Overall, Nolato continues to have a diversified customer portfolio and a good financial position. This enables us to keep focusing on advancing our position as a global, strategic partner on three continents,” said Christer Wahlquist. “We are continuing our efforts to further expand our customer base, reduce our total costs and increase our efficiency to improve margins and grow over time with good profitability.”