Munters Group AB ((SE:MTRS)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Munters Group AB’s recent earnings call reflected a mixed sentiment, highlighting both growth and challenges. While the company showcased strong performance in its Data Center Technologies and FoodTech segments, it faced hurdles in its AirTech division due to market conditions and operational delays. However, the company’s proactive measures to address these issues, along with robust order intake and operational efficiency, suggest a balanced outlook for the future.
Strong Order Intake and Growth
Munters reported a remarkable 57% increase in order intake, with a 70% growth in comparable currency. This surge was primarily driven by strong demand in the Data Center Technologies and FoodTech segments, indicating significant growth potential for the company.
Expansion and Innovation in Data Center Technologies
The company has made significant strides in its Data Center Technologies segment, boasting a book-to-bill ratio close to 1.4. Munters has established a strong market presence in the Americas and APAC, leading in innovation with a comprehensive product offering in cooling solutions.
FoodTech Transformation
FoodTech has undergone a transformation into a digital and software-driven business, showing a substantial 20% to 40% increase in ARR quarter-over-quarter. This segment has garnered strong customer interest, underscoring its growth trajectory.
Operational Efficiency and Cash Flow
Munters has improved its operational efficiency, reducing operating working capital to 8.3% of net sales, which is well below the target range of 13% to 10%. The adjusted EBITA margin remained solid at 13.5%, reflecting the company’s focus on maintaining financial health.
Challenges in AirTech
The AirTech segment faced challenges due to a tough battery market and a tight industrial investment climate in the U.S. and EMEA, leading to a decline in profitability. This segment remains an area of concern for the company.
Currency and Tariff Impacts
Munters experienced negative currency effects of minus 39% and faced tariff impacts in Data Center Technologies, which affected margins by 2 percentage points. These external factors have posed challenges to the company’s financial performance.
Delays in Factory Transition
The transition into the new factory in Amesbury has taken longer than anticipated, impacting AirTech’s margins. This delay has been a significant operational hurdle for the company.
Workforce Restructuring
As part of cost-saving measures, Munters announced a global workforce reduction of about 200 positions in AirTech. This restructuring is aimed at improving efficiency and reducing costs in the long term.
Forward-Looking Guidance
During the Q3 2025 presentation, Munters provided robust guidance, highlighting several key metrics. The company reported a 57% increase in order intake, translating to a 70% growth in comparable currency, and a 17% rise in net sales, or 20% in comparable currencies. Despite facing currency headwinds and tariffs, Munters maintained an adjusted EBITDA margin of 13.5%. The company is implementing a cost-saving program in AirTech to achieve net savings of SEK 250-300 million by the end of 2026 and is investing in strategic growth initiatives, such as expanding its chiller production in Virginia.
In summary, Munters Group AB’s earnings call showcased a mixed sentiment with strong growth in certain segments and challenges in others. The company’s proactive approach to addressing these issues, coupled with its strategic growth initiatives and cost-saving measures, suggests a balanced and cautiously optimistic outlook for the future.