Trelleborg AB (publ) ($TRELB)

Welcome to the Trelleborg Q1 2026 Report Presentation. [Operator Instructions] Now I will hand the conference over to CEO, Peter Nilsson; and CFO, Fredrik Nilsson. Please go ahead.

Thank you, and welcome to all of you for listening in to this presentation of the first 3 months of 2026 for Trelleborg. As usual, I, Peter Nilsson, will start, and then I will also supplemented by Fredrik Nilsson, our CFO. And also on the call here is also Christofer Sjogren, our Head of IR. And as usual, you're going to use the slide deck, which has been on our web page for some time and use that to guide us through the call. And then we move to then Page 1 on that one and quickly moving to Page #2 with the agenda slide, as usual, starting with some highlights, general highlights for the group and then also comment individually on our 3 business areas. And Fredrik will guide us through the financials, and I will then be joining you again for a summary and some comments on the outlook for the running quarter and then finishing off with a Q&A at the end of the call. Turning to Page 3. A good start of the year, solid start in multiple aspects. Sales ended up at slight north of SEK 8.6 billion, a decrease in Swedish krona by 3%. And behind that is a fairly solid organic sales growth of 4%. M&A is also adding another 2%. And then as most companies or every company reporting in Swedish krona, we have a fairly strong headwind from the currency, bringing down the sales in Swedish krona by 9%. EBITA is at slightly shy of SEK 1.6 billion, which is slightly down compared to a year ago, but fully then explained by also the currency effects, ending up at a margin of 18.4%, which is slightly higher than last year and also the highest to date -- highest margin to date for us for the first quarter. I already commented on currency translation, fairly solid, bringing down to SEK 132 million compared to currency rates a year ago. Earnings per share is then up by 5%. We're benefiting from a better financial net, which is down and also from buybacks of shares, of course. We have, as usual, some items affecting comparability relating to ongoing restructuring program, slightly lower than a year ago and ending up at minus SEK 42 million. Strong cash flow for the first quarter, good cash generation and good management working capital and also benefiting from slightly lower CapEx in line with guidance. And we also, which I already commented on, we continue to do share buybacks and it actually ended up at exactly SEK 500 million in the quarter, which is a little bit odd, but nevertheless, it's perfectly SEK 500 million. We also know to continue to do bolt-on acquisitions, and we acquired Nexus Elastomer Molds, which is then being added on to Sealing Solutions, a company actually a little bit different acquisition compared to we did before. This is more kind of a technical acquisition for us, which is benefiting us in the manufacturing processes and adding tooling and automation expertise very much in the core of what we do. Turning to Page 4, some commenting on the sales growth, solid organic growth in Europe. Also solid organic growth in Americas and Asia and the rest of the world and then slightly negative. But all in all, as already commented, turning up to a solid organic growth of 4%, which is quite an improvement compared to a year ago and also improvement compared to last quarter. Page 5, agenda again. Business areas. Turning quickly to Page #6 and starting with Industrial Solutions, a slight organic growth. I mean, organic sales ended up slightly positive. M&A adding another 3%. But of course, also here the reporting is in Swedish krona. We also have a headwind here coming from the negative currency translation rate, which is then bringing down the absolute figures lower than a year ago. And also, if you look on this one, we already commented on that, which is kind of in line what we have commented before. We continue to have slightly lower project delivery, as said, but also with that comment is also a good order book related to this. So we are not concerned for the full year impact from this. We also note that, I mean, as most segments are improving, we don't see really any improvement yet on the construction industry. So that is still very much down compared to, if you call it, the normal level or the way it was a few years ago. Very good performance in aerospace, which is benefiting us. And all in all, we are slightly down on the margin here due to sales mix, and we do expect that to get back to more on par year-on-year following -- going into next quarter -- sort of going into the running quarter, we should say. Page 7. Solid organic sales growth. Medical Solutions organic sales is up by 5%, a strong quarter. Solid sales growth, both in MedTech in Europe and North America, while Asia was a bit more sluggish for us in this quarter, also linked a little bit to different kind of start-up and different variety of inventory buildup among our customers. Life science segment, although small in totality, but we continue to deliver strong sales growth. And if you look at the EBITA, we keep the margin, but I mean, the absolute EBITA is down a little bit also here, impacted heavily by currency translation effects. Turning then to Page 8. On Trelleborg Sealing Solutions, same heading here for our Medical Solutions, solid organic sales growth, organic sales up by 6% and another 2% added by M&A. Sales is actually quite good all across the regions in the Industrial segment and then most of our subsegments also in this industrial space is developing nice in the quarter. Automotive segment declining a little bit for us, and that is -- we continue to have a little bit challenge in the aftermarket. Sales, it's our sales. I mean, that is where we are waiting a little bit for a bounce back in that. Aerospace segment continue to have very robust global growth, benefiting overall for the business area. Margin is then also up on the basis of this fairly solid organic growth, and we are up by, yes, 1.6 percentage points compared to a year ago. And that is on the back of these higher volumes, but also operational improvements kicking in. And then we should say especially on the absolute EBITA figure, of course, we're impacted also by the -- as on all of the business impacted by the negative FX translation effects. Acquisition of Nexus, I already commented on that, which is kind of a technical acquisition adding to more operational improvements and actual sales improvements. Turning to Page 9, commenting a little bit on sustainability. We're actually flattish year-on-year. We are getting to levels where it's getting more challenging to improve and it's actually not that much in absolute figures anymore. We are, of course, working further, and we do expect continued improvements, but there is not a lot to do anymore in this. And the same applies if you turn to the next page, Page 10, is also that we're running on a very high level on renewable and fossil-free electricity, although up by 1 percentage point year-on-year, but the final percentage here is more challenging to improve further. But once again, of course, we're working with it, and we do expect a slight improvement also going forward in this aspect. Turning to Page 11, agenda again, financials and then turning to Page 12 and handing over to Fredrik.

Thank you, Peter. Let's then move to Page 12, starting looking at sales development. Reported net sales declined by 3% in the quarter from SEK 8.866 billion to SEK 8.606 billion. As Peter mentioned, there was a significant negative translation effect in the quarter of 9%. We had good organic sales growth of 4%, and then Structure added 2% in the quarter. Moving on to Page 13, looking at the sales growth trend. In the first quarter, we had a good 6% at constant FX. So a really good and strong sales growth trend in the quarter. Moving on, Page 14, showing the quarterly sales in the rolling 12 months for continuing operations. As I said, SEK 8.6 billion in sales. And if we're looking at the rolling 12 months basis, it was SEK 34.1 billion in sales. Page 15, looking at the EBITA, excluding items affecting comparability, down 2% to SEK 1.586 billion. In the quarter, there was also a significant negative translation effect of SEK 132 million in the quarter. And at fixed FX, EBITA improved by 6%. And then looking at the EBITA margin, up from 18.2% to 18.4%, which is actually the highest margin for first quarter ever. And the margin improvement was due to the organic sales growth and continued operational improvements. Moving on, Page 16, looking at EBITA and EBITA margin on rolling 12. Here, you can see that the rolling 12, it was SEK 6.256 billion and a margin of 18.4%. And you can also see in the chart here that it was -- EBITA has been flat during the last 12 months, but we have had a material negative FX impact during this period. Moving on to Page 17, looking into some more details in the income statement. Looking at items affecting comparability in the quarter, minus SEK 42 million, which was related to restructuring. Then as also Peter mentioned, looking into the financial net, there was a good improvement from minus SEK 144 million to minus SEK 102 million, and that was due to lower interest costs. And then on the tax rate, 25% in the quarter, which was in line with the communicated guidance for the full year as well. Moving on, Page 18, earnings per share, a good improvement of 5% in the quarter from SEK 4.28 to SEK 4.50 when we're looking at excluding items affecting comparability. And the main reason here for the improvement was, of course, the lower financial net, the ongoing share buyback program, which was then partly offset by some negative translation effects. And then if we look for the group, including items affecting comparability, we have an improvement of 7% in the quarter. Turning to the next page, looking at the cash flow. Good cash flow in the quarter, up 14%. And if you're looking then at the chart on the left side of the slide, you will see there was a good improvement in working capital. And as always, we have a negative working capital in the first quarter due to normal seasonality. And then also on the -- looking at the CapEx, good improvement of SEK 100 million in the quarter between '26 and '25. Going to Page 20. Cash conversion increased to 95%, and we have a good high cash conversion ratio in the quarter. Moving on to Page 21, gearing and leverage development. Net debt at the end of the quarter amounted to SEK 7.8 billion. Share buyback of SEK 500 million in the quarter, as Peter mentioned. We have a debt-to-equity ratio of 21% and net debt in relation to EBITDA ended at 1.1x. In other words, our balance sheet continues to remain very strong. Moving on, Page 22, return on capital employed. You can see it ended at 12.3%. We have had a flat capital employed compared to prior year. But the good thing is that the rocket trend continued from Q3 2025 and continue to gradually improve upwards. And then finally, moving over to Page 23, looking at the financial guidance, which is unchanged compared to what we communicated in January. But just to repeat, CapEx estimated for the full year to be SEK 1.450 billion, restructuring cost of SEK 375 million, amortization of intangibles, SEK 650 million and underlying tax rate of 25%. And by that, I would like to hand back the microphone to you, Peter.

Thank you. And turning then to Page 24, agenda slide again. And moving to the next section of the presentation, summary and outlook. Turning to Page 25. Good start of the year. That is the way we look at this. We have an improved demand seeing across multiple segments, while recognizing that we have a turbulent world and some big things happening in a lot of areas, which will impact the economies. But we -- honestly, we don't see it really in our businesses. We have better order intake. We have a positive book-to-bill in the quarter, and we, therefore, also get back to the guidance on the next page. But then we see actually an improvement here also quarter-on-quarter. On top of that, margin improvement, I mean, it's not some big steps, but we continue to improve the margin and we continue to push it towards our long-term objectives. We also note we have, let's say, a quite heavy adverse currency impact in the quarter. I cannot really remember when we had similar headwind from currency before. I mean, 9% is big figures and SEK 130 million also on the EBITA, but nevertheless, managing it in a good way. And I think it also shows when you look at the margin in combination with the currency impact that we don't really have any kind of transactional -- meaningful transactional exposure. So it's a pure translational exposure that we are exposed to. And we also note that we continue to do share buybacks. We bought, as I said before, we actually hit exactly SEK 500 million in the quarter, and we're going to continue with the same pace. And here also, hopefully, very likely here in the next few hours, we will have our Annual General Meeting, and then we'll get the mandate to continue with these buybacks. Turning then to Page 26 to comment a little bit on the running quarter. I already see that this -- we believe -- on the backing of the good development in the first quarter, we believe that we're going to have actually an improvement here quarter-on-quarter. And I also want to comment on this also, we really in the quarter, we don't see any prebuying coming from these extra costs are going to hit us in multiple areas. So we don't see that impacting us in March. And honestly, we don't see it in the order book either happening really in Q2 yet, but let's see what happens. But once again, on the backing of a good development and improved demand in most industrial segments, continued good demand in aerospace, also automotive, although a mixed picture, but we don't really see any downturn there either. It's a bit bumpy in the medical area, the customers is ordering in, let's say, big bulks. But also here, we have had a solid order intake, and we also look positive going into the running quarter. Of course, all of this is commented on, we already said, there is a challenging geopolitical situation in several parts of the world. And who knows what impact that will bring us if it escalate in different areas, could be positive, could be negative. But nevertheless, we recognize that this is a higher uncertainty than usual. So then turning to next page, Page 27 and quickly turning to Page 28 as well and opening up for questions. So please go ahead.

[Operator Instructions] The next question comes from Chitrita Sinha from JPMorgan.

I have 2, please. My first question is just on the price volume development that you saw in the quarter, especially in Sealing Solutions, which clearly saw a very strong increase in the margin.

Fredrik, do you want to go?

Yes, we normally don't split that out the price volume. But as always, I mean, there is a price component, but there was a solid volume development in the quarter. I think that is as much as I can say.

Yes. And it was a higher -- better volume growth in the quarter than we've seen for some time, and that is the main benefit of the margin. With that said, of course, we are adjusting pricing. We are, let's say, adjusting for increased costs going forward, but we cannot see that we've seen that in the figures yet.

Very helpful. And then you've already touched on this, but just drilling a bit down into the Q2 demand guide. Which end markets, in particular, are you incrementally more positive on or where you're seeing more positive demand? And then also, obviously, what's driving the confidence behind this guidance given the uncertainty?

As I said already, most of the segments doing good. We have what we call in the Sealing, we have Hydraulics, which is big going into construction equipment and mining and also partly actually first signs of some positives also in the ag sector. So that is benefiting. But also we see semiconductors developing well. We see aerospace developing well, and we see also automotive actually improving from a fairly soft start of the year, we have seen improvement here during Q3. So I'd say it's a broad-based improvement, and we have to kind of struggle to identify areas where it's actually getting worse. With that said, we still did expect -- I mean, not everything is bright blue. I mean we did -- let's say, we are waiting still for an uptick in the construction industry, and that is where we are a little bit concerned. It's bumpy in the oil and gas, but we also see there LNG and oil and gas, I mean, projects are continuing. So I mean, honestly, it's kind of a very broad-based improvement, and we struggle to see areas where it's not improving or at least moving flat.

The next question comes from Opeyemi Otaniyi from Goldman Sachs.

Maybe 2 questions from me, just on the Middle East and then visibility on LNG and maybe an uplift there. But can you just talk to sort of any revenue impacts and sort of cost impacts you saw from the Middle East crisis? And then on energy, could you just update us on visibility of sort of project delivery improving in sort of Q2 and H2 as well?

I mean the limited, let's say, business impact. We have some project sales in Middle East, but it's not really stopped to be honest. It's continuing. We have some projects ongoing that are continuing, and we have some repair projects kicking in as well now following this, let's say, what has been happening there. So far, we don't really have an impact on the actual sales. We do expect the energy pricing going up, and we do expect that to kick in on the raw material, but that is something as usual in Trelleborg, we're going to adjust to that, and we are not kind of overly concerned. It's extra job and this is something which is maybe not, let's say, value-adding long term. But I mean that is something we manage and something we do. So the impact from the Middle East so far is mainly that we do expect going forward some raw material pricing and some freight and all of that going up. But that is kind of basic business and something we're adjusting for. On the project business, I mean, we have a solid order book and overall, both in kind of tunnels and marine tendering and also some oil and gas in general. So this project business has a solid order book, but it's been -- there's a little bit ups and downs depending on when projects are being delivered and being installed. So that is kind of normal, and we have a good visibility on it. We have guided from last quarter, this quarter is going to be a little bit softer. Now we do expect it to improve somewhat in terms of deliveries for the rest of the year. So we are not kind of concerned and the visibility on that part of the business is very good.

The next question comes from Alex Jones from Bank of America.

Two, if I can as well, please. First, just a follow-up on your comments on not seeing any prebuying. Can you just expand a little bit on how you reach that conclusion and make sure that customers aren't precautionarily stocking up across different end markets ahead of potential price increases or supply chain impacts. For example, did you see growth improving linearly across the quarter? Or was it very concentrated in March and the start of April? And then secondly, just on raw materials, following up on the previous questions. Are you able to give any color on sort of the magnitude of price increases that you're talking about with customers so far and whether that will already have a positive impact on the organic sales growth line in Q2?

First on the prebuying, I mean, generally, we are not kind of getting orders one day and shipments next day. I mean we are getting, let's say, a little bit longer ordering times and longer shipment times. So that means that we have not really seen it happening. Of course, it could be some of the orders going forward, there could be some prebuying, but we don't see kind of any bigger magnitudes, and we don't see any customers doing rush orders and stuff. So they are continuing as usual, but we have plenty of orders, it could be some of it. But we don't, I mean, see any kind of change in pattern or change in anything in a way. March was, let's say, a bigger month than the other ones, but it's also more, let's say, working days and it's normal that you have a soft start in January and then it picks up in February and March. So of course, it was a good ending of the quarter, but that was also kind of as expected. So -- but in short, there could be coming some prebuying now as the price increases is kicking in. But we have -- honestly, we are not seeing it really in the order books or in our kind of discussions or talks with our customers. Second question on magnitude of price increases. It varies a lot across what kind of raw materials you're talking. You have these very basic raw materials for us in the rubber, carbon black or SBR and of course, freight is also something. So the products which are exposed to these areas, then we probably talk kind of probably double-digit, let's say, price increases. But for the majority of the raw materials, it's kind of difficult -- the vast majority, we are very little exposed to this kind of, if I may say, the basic, let's say, rubber polymer materials. We are more in specialty materials and our pricing or the costing for our suppliers is more linked to capacity utilization than actually underlying price increases. But with that said and done, I mean, I don't really want to comment, Alex. We are in the middle of that at the moment, and we are working on it. There will be price increases. I do not expect the price increases to kick in that much during Q2. So it's probably going to be more going into the second part of the year. But exactly how much and we -- honestly, I mean, we don't have the full map yet. We are working on it, and we are implementing in some areas. But I mean, also it's not happening overnight. So that is going to be step-by-step kicking in during Q2 and then probably more visible going into the second part of the year. That's what I can say, Alex, trying to be fully transparent.

The next question comes from Agnieszka Vilela from Nordea.

I have a question on the acquisition impact. It is fading away a bit now, 2% in the quarter. And according to my calculations, unless you release any new kind of acquisitions information, it will come down to 1%. So can you just comment, Peter, on the M&A landscape right now? And should we expect any more deals in the near term from you?

It's always challenging. We're working on deals, let's put it like that. We have several discussions going. Exactly -- and we are -- let's say, firmly believe that we're going to do more deals this year. But I mean, exactly when they kick in and when they will be done, it's difficult to comment. But I mean, I would be disappointed if we're sitting here by the end of the year and we have not done a couple of more deals, but you never know until it's signed and communicated. But the activity level is high. There is plenty of prospects. I think it's actually the increased activity levels we see private equity guys coming in, trying to sell, of course, with quite demanding valuations. I mean it should be honest to say that we stepped away from a few processes lately where we lost the case mainly against private equity guys, which is now starting to pay up again, and we are, as usual, careful on that one. But it's very difficult to give a figure on this, Agnieszka. But I mean, we will do more deals and there will be more deals communicated. And you're probably correct, by the way, on this on the 2% to 1%. That is probably a good estimate.

Okay. Perfect. And then I have a question to Fredrik as well. You still keep your CapEx guidance at SEK 1.45 billion for the year, but your running rate right now for CapEx is below SEK 300 million per quarter. So do you foresee any significant CapEx investments ahead of you?

No. But I mean it's always a little bit of timing. So I know we started the year a little bit lower, Agnieszka, but we still feel based on what we have in the -- our strategic plans, and there is also a couple of greenfields that will be going on for 2026. So we expect that we will reach that level that according to our guidelines.

We have 2 big ones in India kicking in now. I don't know which other ones do we have.

And we are finishing off, of course, the one in Morocco, we're finishing off one in the U.S. So we expect that we will end the year at the level we have communicated even if the year has started a little bit on the lower side.

The next question comes from Timothy Lee from Barclays.

So I have 2 questions. The first one, again, about the second quarter guidance. Can you also clarify a little bit whether this expectation of better demand in the second quarter? This also sit on the fact that last year second quarter was a bit low in terms of organic sales. So we had a higher -- we had a lower comparison than last year. So that's the first question.

Yes. I mean I don't really -- we are only commenting on sequential, and we don't really -- I cannot really develop it any further. I mean we have a good order intake. We have solid development in all areas, and we do expect this improvement from the run rate in this quarter to improve. I mean we're not really comparing with a year ago, we're comparing quarter-on-quarter here sequentially. So that is, I think, what I can say on that. I don't know if anybody else want to add anything. Is that okay, Tim?

Yes, sure. So yes, the second one is about the Industrial Solutions. Can you also please quantify a little bit of the impact of project delays in terms of deliveries? I think that you're expecting sales to increase in the second half and margin to improve this next quarter. How much of the organic sales growth can we expect incrementally from these deliveries and what kind of margin improvement...

Sorry, I don't really want to give a guidance, let's say, business area and business areas. But as rightly said, we do expect it to improve going forward. And of course, I mean, then it will be an improvement, but I cannot really give dimension on that one. And even though we say the kind of project sales is improving. But with that one, we look at that for the full remainder of the year. But honestly, also there, I mean, some of these projects, we don't know whether it's going to kick in, in Q2 or Q3 or Q4, but we do see that it's going to improve. I mean we have a few projects which has been a little bit slow, somebody holding back. But of course, we know the order book and we know when the customer is asking for the products, but it's still a little bit uncertain exactly what month it will be invoiced. But if you look at the full year, we do expect it to bounce back a little bit compared to what we have seen in the last few -- the last 2 quarters on Industrial Solutions.

Got it. Very helpful. Can I just follow up a little bit on -- can you also tell us about your book-to-bill for the group or for each segment, if you can?

I don't really want to give, let's say, these, we are not reporting that. And I mean, we are -- but it is higher -- of course, I mean, as we are guiding for a higher organic growth in Q2, it is higher than the sales. So it's higher than the sales growth. But I mean, we don't really want to -- we have decided not to release that figure, but you have to, I think, expect the comment that it's higher than the sales growth.

The next question comes from Hampus Engellau from Handelsbanken.

Two questions from me. Firstly, if we could drill a bit on the automotive demand during the quarter, you see a sequential improvement. But also interesting to hear how this part that is impacted by the tariffs is developing and how do you see that going forward? And then the second question is related to Asia. If you kind of remove medical from that, I know, for instance, that Sealing is doing very well in China. Could you maybe talk a little bit about China and Asia ex medical, what you see and how that is trending?

On the automotive tariffs, I mean, it might be that there is -- we have a good development in North America, and I don't know whether that is. But there's also a lot of new models being launched in U.S. this year, maybe coming also from the tariffs, but more from a model change perspective in U.S. and that is always with the model changes, there is some prebuying and some inventory buildup. We had a very soft start of the year in automotive, but that's been improving step by step. I don't know whether there's a reaction or a very careful start of the year. And I mean it's really difficult to find the exact drivers for it. But China continues in a positive way and Americas doing better. Europe a little bit softer. But overall, all 3 areas is actually improving sequentially, to be honest. So it is kind of an improvement, which is a little bit surprisingly good, to be honest, of course. But I mean that is kind of -- we have to trust the fact and that is the way it looks, both in terms of sales and order intake. And then the second question was about Asia. I mean also when we say when we report Asia, it's also rest of the world. So we are -- that is also something we get back to this project deliveries. We have good project deliveries in Australia a year ago. There were also some in Southeast Asia. We had a Taiwanese order. So it's a little bit bad comps in a way, which is pulling it down. So the core kind of industrial sales in Asia is developing quite okay. I mean we are growing semiconductor sales. We are growing kind of hydraulics, let's say, construction equipment-related sales. India also doing solid. So I mean, it's not really the majority -- the main explanation on this, let's say, negative 1 organic growth in Asia is actually related to fairly challenging comps related to project sales and the majority -- I mean the majority of that -- I mean Asian sales in it, but there's also some Australian sales in it and some African projects and stuff. But that is -- this kind of -- this also, unfortunately, this varies a little bit in between the quarter. So the core sales, if I may, core industrial sales in Asia is still developing in a favorable way.

The next question comes from Mats Liss from Kepler.

Three, I think. First, I mean, you talked about the pretty slow start of the year and improving momentum in March there. Is it fair to say that you were sort of on average 6% for the quarter reached some 10% plus in March?

I don't want to comment on that, Mats, sorry. I mean we're commenting on the quarter. It is, let's say, improvement -- as you say, it's improvement throughout the quarter, but it was a soft start in January and then February and March better. So that is probably the same. But it's also -- if you look individually in March, of course, it was also higher invoicing days. So of course, naturally, it was a good month, but it was also, let's say, by day -- business day [indiscernible] well. It was okay, but it was not extraordinary.

And well, number two then, well, could you just remind me, I guess, everyone else knows about this. But in Industrial Solutions, you have this project. I mean, raw material prices have come up a bit. Do you hedge them fully, so there is no risk there for you?

Generally not. But -- generally, we do not. There is individual projects where we do it, but we are kind of also prebuying a little bit there. So it's a balance of prebuying -- hedging is generally quite expensive. So the way to hedge it is to prebuy or pre-agree, but we don't do that generally. So it's more a matter if it's a high kind of raw, which is generally not the case, but there is any case where we have high raw material content, we are looking for ways of securing. I mean with that said, we don't expect that we will, let's say, lose any margin on this kind of higher raw materials. So we will sort that out and we will manage it. So you will not have as much complaining about that in the next few months that high raw material prices is pushing down the margin. This will not happen.

Okay. Sounds very sure. And then restructuring, I guess it was a bit lower than last year. Is this the new level? Or is it sort of quarter-by-quarter you make this...

It varies depending. I mean most of it is related to factory closures and that is kind of long going plans. And I mean that sometimes we plan them several years ahead, and that is more individually hitting. So I think you have to look at this not as an individual quarter, but as a kind of a rolling 12 figure. I don't know, Fredrik, do you want to...

No, I mean the guidance that we have on the SEK 375 million, Mats, that is what you should expect for the full year. And then it can be a little bit bumpy between the quarters. But looking for the full year, it's SEK 375 million that is the level you should have in mind.

Great. And finally, just coming back to Agnieszka's question there about M&A there. I mean, is it fair to assume that these medium-sized acquisitions that you have of '25 and '26 like Nexus, is that the size to be expected going forward?

Yes. I mean we say generally, it's between kind of EUR 10 million and EUR 50 million, that is a typical size. And then probably the deal size is similar or slightly higher. So that is kind of typically the cases we're looking at because if we go bigger, they are generally not as focused. And if we buy something, we want to have really a focused acquisition, which is benefiting us in a specific geography or a specific technology or specific kind of business. So it's not really that we're looking for these bigger general acquisitions, which contains a lot of different businesses. We are looking to buy very focused businesses, which is kind of a very nice bolt-on to something which is already existing and already well positioned.

[Operator Instructions] The next question comes from [ Bowen Thacker ] from Bloomberg Intelligence.

I just had one on Sealing business margin. What should we think about the cadence of the margin of this business going forward given the significant improvement you've seen this quarter? Should this improvement kind of hold? That's my question.

No, of course, we're aiming higher. And we are always commenting on Sealing. It's running with fairly good gross profit, fairly good contribution margin. So if we see volumes continuing or even improving, then we should see actually continued improvement in the margin as well here. And that is kind of what we're looking at and what we have been commenting for quite some time that when or if volume kicks into Sealing Solutions, especially, we will see an improved margin in that business. And that is something we still believe in.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you. And thanks all of you for listening in, and thanks for your interest in Trelleborg. I mean we're happy to support you further. Feel free to contact me and contact Fredrik and especially contact Christofer if you have any follow-up questions or any kind of further input. So do take care, meet you soon and all the best.