Trelleborg AB: Interim report and year-end report 2024

Growth with enhanced profitability

"Trelleborg ended 2024 with a strong fourth quarter. We achieved positive organic sales despite continued varying market conditions and declining volumes in several markets. Sales were the highest ever for a single quarter and operating profit, including the margin, was the highest to date for a fourth quarter. Sales increased by 4 percent during the quarter. Organic sales increased by 1 percent and acquisitions contributed 3 percent. EBITA, excluding items affecting comparability, increased 12 percent, corresponding to an operating margin of 18.1 percent (16.9).

In recent years, Trelleborg has evolved to become a less cyclical company that offers unique solutions for carefully selected applications and market segments. At the same time, profitability is growing steadily toward our financial targets, despite the fact that in many respects we have been battling market headwinds over the past year. Our persistent work to constantly improve in multiple dimensions is continuing. We are reinforcing already strong positions with bolt-on acquisitions, the pace of capital expenditures has never been higher and we look to the future with confidence.

During the quarter, we finalized a number of acquisitions that demonstrate how we are continuing to build on our leading market positions. We acquired Magee, a specialist in thermoplastics, allowing us to broaden our offering, particularly for the aerospace industry aftermarket. Another value-generating acquisition is Mampaey, a manufacturer of solutions that strengthens our global leading positions in the expanding marine and LNG industries. A couple of days into the new year, we finalized the acquisition of CRC, a North American distributor specialized in polymer sealing solutions, which improves our presence in a part of the US where we have been previously underrepresented.

We maintained a high level of activity during the year in the form of investments in new capacity and expansion of our presence in selected geographies and market segments, including in Costa Rica, Vietnam and Morocco. Several of these new plants will be inaugurated in 2025 and will result in us further advancing our positions.

Trelleborg Industrial Solutions' organic sales for the quarter increased year-on-year. This was mainly achieved due to major project transactions in marine applications. While organic sales declined in Europe, an increase was noted in North America and Asia. Deliveries to certain segments in the construction industry were challenging, mainly due to a softer market in North America. There was further improvement in the business area's profitability.

Trelleborg Medical Solutions' organic sales for the quarter were unchanged year-on-year. The acquisition of Baron Group contributed to a sales increase of 40 percent and also strengthened the business area's profitability. Our sales to the European medtech market performed well, while sales to the US market were somewhat weaker.

Trelleborg Sealing Solutions' market segments developed in different directions, with sales declining marginally overall. Sales to diversified industrials were weaker in Europe and North America, while sales in Asia developed well. Deliveries to the automotive industry demonstrated similar regional sales patterns. The aerospace segment reported significant sales growth globally.

The market conditions at the beginning of 2025 contain a large measure of unpredictability. However, our capacity to adapt our operations is both extensive and rapid. The Group stands well equipped with a strong balance sheet that enables value-creating acquisitions, continued investments in existing operations and continued share buybacks. Our general assessment is that demand in the first quarter will be on a par with the fourth quarter", Peter Nilsson, President and CEO.

Fourth quarter 2024

• Net sales for the quarter increased 4 percent to sek 8,783 m (8,421). This was the highest net sales reported for a quarter. Organic sales increased by 1 percent compared with the preceding year, structural changes increased sales by
  3 percent, and currency was unchanged compared with the preceding year.
• EBITA, excluding items affecting comparability, increased 11 percent to sek 1,587 m (1,424). The EBITA margin was 18.1 percent (16.9). Earnings and the margin were the highest to date for a fourth quarter.
• Items affecting comparability for the quarter totaled sek -76 m (-260) and pertained to restructuring costs. Comparison figures in the preceding year included a capital loss of sek -87 m from the divestment of the offshore oil & gas operation in the US.
• EBITA, including items affecting comparability, amounted to sek 1,511 m (1,164) for the quarter.
• Earnings per share for continuing operations, excluding items affecting comparability, amounted to sek 4.24 (4.08), up 4 percent.
• For the Group as a whole, earnings per share were sek 3.99 (3.40).
• The Board of Directors proposes a cash dividend of sek 7.50 per share (6.75).
• Operating cash flow amounted to sek 1,681 m (1,321), up 27 percent. This was the highest operating cash flow reported for a quarter.
• The cash conversion ratio for the most recent 12-month period was 89 percent (92).
• The key figures in this report relate to continuing operations, unless otherwise stated.

Full year 2024

• Net sales for full year 2024 were on par with the preceding year at sek 34,170 m (34,286). Organic sales were unchanged compared with the preceding year, while structural changes increased sales by 1 percent and currency decreased sales by 1 percent compared with the preceding year.
• EBITA, excluding items affecting comparability, increased 2 percent to sek 6,140 m (6,002), corresponding to an EBITA margin of 18.0 percent (17.5). Earnings and the margin were the highest to date for a full year.
• Items affecting comparability amounted to sek -315 m (-614) and pertained to restructuring costs. Comparison figures in the preceding year included a capital loss of sek -87 m from the divestment of the offshore oil & gas operation in the US.
• EBITA, including items affecting comparability, totaled sek 5,825 m (5,388).
• Earnings per share, excluding items affecting comparability, amounted to sek 16.74 (16.64), up 1 percent.
• For the Group as a whole, including discontinuing operations, earnings per share were sek 15.73 (40.24), the comparison figure from the preceding year included the capital gain from divestment of the Group's tire and printing blanket operations.
• Operating cash flow amounted to sek 5,011 m (5,063), down 1 percent.
• The cash conversion ratio was 89 percent (92).

Market outlook for the first quarter of 2025
Demand is expected to be on a par with the fourth quarter of 2024, adjusted for seasonal variations. The geopolitical situation entails continued uncertainty.

Market outlook from the interim report published on October 24, 2024, relating to the fourth quarter of 2024
Demand is expected to be slightly lower compared to the third quarter of 2024, adjusted for seasonal variations. The geopolitical situation entails a heightened degree of uncertainty.

Dividend 2024
The Board of Directors proposes a cash dividend of sek 7.50 per share (6.75).

This is a translation of the company's Interim Report in Swedish.

Contacts
Media: Vice President Communications Tobias Rydergren, [phone], [phone], [e-mail]
Investors/analysts: Vice President IR Christofer Sjögren, [phone], [phone], [e-mail]

About Us
Trelleborg is a world leader in engineered polymer solutions that protect critical applications in demanding environments. Its innovative solutions accelerate performance for customers in a sustainable way. In 2024, The Trelleborg Group had annual sales of approximately SEK 34 billion in around 40 countries. The Group comprises three business areas: Trelleborg Industrial Solutions, Trelleborg Sealing Solutions and Trelleborg Medical Solutions. The Trelleborg share has been listed on the Stock Exchange since 1964 and is listed on Nasdaq Stockholm, Large Cap. www.trelleborg.com

This information is information that Trelleborg is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 2025-01-29 07:45 CET.