This article first appeared on GuruFocus.
Release Date: July 17, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Alleima AB (SAMHF) reported a strong quarter with organic growth in both order intake and revenues, marking a positive shift from previous quarters.
The company received its largest order in history, valued at almost 1 billion SEK, primarily for umbilicals, indicating strong demand in key segments.
The medical and industrial heating segments showed significant growth, contributing to an increase in the sustainable product portfolio.
Alleima AB (SAMHF) paid a dividend of $625 million, a 9% increase compared to 2025, reflecting strong financial health.
The company is progressing well with targeted cost-saving measures, achieving savings in line with expectations.
Negative Points
Market uncertainty persists, particularly due to instability in the Middle East, affecting the OCTG business and creating overall uncertainty.
The short-cycle business within the tube segment remains weak, particularly in Europe, impacting overall performance.
CO2 emissions increased due to a lower share of biogas and higher use of natural gas, indicating environmental challenges.
The Strip division faced production disruptions and a decline in order intake, impacting its contribution to group margins.
The company anticipates ramp-up costs related to new facilities, which may impact short-term earnings.
Q & A Highlights
Q: You mentioned there will be some ramp-up costs related to the reopening of the facilities for steam generator tubing. Can you give us a rough figure of how much that is and maybe a rough split of how that will be divided in Q3 and Q4? A: We are transitioning from the project phase to real production, and during the ramp-up, there is no invoicing. We have roughly 100 people involved, and it’s about 20 million in costs per quarter until invoicing begins. This will impact Q3 and Q4, with costs around 20 million.
Q: After the previous ramp-up issues in Sandviken, you mentioned that catching up to the OCTG backlog would take until mid-2026. What impact did it have this quarter, and is the backlog reduction now complete? A: The delay related to last year’s ramp-up was not significant in Q3 but more in Q4. The backlog reduction has been caught up now, and the market has changed significantly since then.
Story Continues
Q: Mining and construction was a negative contributor this quarter. Can you give some color on what you’re seeing from that segment and expectations for Q3? A: We see stable good order intake from a couple of big Swedish customers, which is positive for us.
Q: You give the same comments related to general uncertainty as previous quarters, but it sounded like you were somewhat more optimistic. Is that correctly interpreted, and why? A: The strong order intake in Q2 and our ability to manage uncertain times well, with key segments like umbilicals, industrial heating, medical, aerospace, and nuclear showing positive trends, contribute to a more optimistic outlook.
Q: Regarding the nuclear line ramp-up, when it starts ramping up significant volumes, should we see this as extra volumes or a mix effect? A: It’s extra volumes. We will be able to produce 60% more, and we have a backlog for that. It’s not a redirection of existing volumes.
Q: For Tube orders, even if you strip out the large oil and gas order, is the improvement broad-based or mainly in oil and gas? A: The improvement is broad-based. Umbilicals had a strong quarter, and aerospace was also good. These are the strongest segments within the Tube division.
Q: How much does the current strong order intake in Q2 de-risk estimates for the second half of the year? Are these orders to be delivered soon or further out? A: It’s a mix. Some orders impact Q3 and Q4, while others build backlog. For example, umbilicals’ orders add to the backlog, while industrial heating shows positive near-term impact.
Q: Could you comment on capacity utilization in Kantal and the operating rates there? A: We don’t disclose capacity utilization numbers, but it’s a mix. Medical is increasing capacity, and industrial heating has some units that could use more volumes. Overall, Kantal is running at good levels and can continue to grow.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.