Alfen: A 55% EV Market and a Supplier Shrinking Into It

The quarter looked like phasing; the story is a transformation that keeps paying out in 2027 promises while margins get flattered by one-off storage completions

ALFEN.AS · Earnings Call · 2026-11-04

The quarter that wasn't as bad as it looked — or as good

Alfen's Q3 2026 headline was weak: revenue fell to €99.1m from €104.1m, and adjusted EBITDA dropped to €4.0m, a 4.0% margin versus 6.7% a year earlier. Management immediately redirected attention to the nine-month number. “Revenue came in at EUR 99.1 million, compared with EUR 104 million in Q3 2025... The number that better reflects the underlying momentum of the business is our year-to-date revenue, which grew 14.3% to EUR 360.6 million.” — Michael Colijn, CEO · 2026-11-04 That is fair as far as it goes, but the quarterly mix matters. Energy Storage Systems revenue was deliberately front-loaded into the first half, and the Q3 gross margin got a one-off lift from project contingencies released as large projects completed. The gross margin line tells the story better than the EBITDA line. Group gross margin rose to 30.8% from 28.7%, and the storage segment printed 37.1% versus 18.2% — far above its 15% to 25% expected range. “The group gross margin was strong this quarter, in part due to an outperformance of the Energy Storage Systems compared to its expected range.” — Bart Meussen, Interim CFO · 2026-11-04 Michael Colijn was explicit that this is not the run rate. The beat is a completion effect, not evidence of a structurally higher margin. The EBITDA decline, meanwhile, reflects both revenue phasing and a planned step-up in transformation costs.

2026 is a year of deliberate and fundamental transformation. The decisions we are making this year in our portfolio, our platform, our organization and our operational capabilities are designed to build a stronger, more resilient Alfen for the years ahead. They come with near term costs, and we are not shying away from that, but we are making them with conviction.
Michael Colijn, CEO · 2026-11-04

That is a coherent narrative. It is also the same narrative Alfen has been telling for several quarters.

EV Charging: a growing market, a shrinking supplier

The uncomfortable contrast in the quarter is EV Charging. European battery-electric registrations grew 55% year-on-year in Q3, with France more than doubling and Germany up 77%. Alfen's charge-point deliveries fell 10.6% to 25,850, and segment revenue declined 6.7% to €26.8m. Management points to the phase-out of old products and continued competition in the residential segment. The business-charger line is growing — the Eve Double Plus is gaining traction — but not yet enough to offset the residential decline. The pivot rests on the new home charger, launched only last week. “We just launched the home charger last week. And as we start to ramp-up for mass production and delivery, we would expect to see an effect of that in 2027.” — Michael Colijn, CEO · 2026-11-04 More precisely, noticeable volumes are expected from Q2 2027. That is a long runway for a product meant to restore growth, and it is not a new promise. In August, management already said, “we expect to see the full impact of the new home charger in 2027. And all our chargers will also move to that new platform in 2027.” — Michael Colijn, CEO · 2026-08-19 The new platform is real and the software features are rolling out, but the commercial payoff keeps slipping right — and the mix effect will not be flattering, because home chargers carry lower average selling prices. Segment gross margin held at 40.9%, above the midpoint of the 35% to 45% range, but management flagged ongoing sales campaigns and old-versus-new platform mix. This is a segment in transition, not yet in recovery.

Smart Grid is the reliable engine — with external brakes

Smart Grid Solutions did the heavy lifting again: revenue rose 10% to €54m, with 870 substations delivered and Finnish subsidiary Elkamo posting its highest quarterly revenue to date. Grid-operator sales were 70% of the mix, which explains the segment gross margin slipping to 23.7% from 25.9%. The regulatory direction helps — the EU Grids Package, Dutch crisis legislation from 2027, Finland's 2036 security-of-supply targets — but the bottlenecks are physical: permits, transmission capacity, land, component deliveries and installation crews. “The long-term need for grid infrastructure is clear and growing. In the near term, however, the pace is set by execution in the field.” — Michael Colijn, CEO · 2026-11-04 That is consistent with August, when management had “not seen anything concrete yet that immediately accelerates this market or spurs it on that you can have double-digit growth.” — Michael Colijn, CEO · 2026-08-19 The Dutch grid operator demand is strong but lower-margin, and the rollout of large substations remains slower than originally planned. Alfen is cautiously optimistic about 2027, but Smart Grid is a steady compounder, not the margin savior.

Cash, backlog and the 2027 ask

The near-term catalyst is order intake. Backlog stood at €109m at end-September, up from €93m at mid-year, with €86m carrying into 2027. Management targets a year-end backlog above the €127m level held at end-2025. Hitting that requires converting pipeline in Q4, and the company says it is comfortable with its win-rate assumptions. A renewed credit facility — €50m revolving and €80m guaranteed, running to October 2029 with extension options — is a genuine balance-sheet positive, giving Alfen room to fund working capital without equity. But cash remains sensitive to storage order timing. The CFO's ambition is at least cash-flow neutral, yet winning large storage projects late in the year can require procurement before delivery, consuming cash. Supply constraints add a wrinkle: “We recognize constraints in e-components, in transformers, inverters, leading to higher prices and basically also longer lead times.” — Bart Meussen, Interim CFO · 2026-11-04 That supports pricing but ties up inventory. Personnel cost is also still elevated, up 10% year-on-year due to the transformation, and management expects H2 broadly in line with H1 rather than normalizing sharply. The 2027 profitable growth promise is now a familiar refrain. In February the CFO said, “the guidance for 2027 is moving in the direction of profitable growth... I don't want to basically go beyond that.” — Onno Krap, Chief Financial Officer · 2026-02-11 In August, management reiterated the same directional improvement. Now the CEO says Alfen will reignite consistent profitable growth and will give formal 2027 guidance in early 2027. The transformation is real — new platform, new home charger, renewed credit facility, operational storage projects — but the evidence of inflection is still back-end loaded. For a €255m market-cap company, this is a show-me story: the next proof points are Q4 order intake above €127m and visible home-charger volumes in Q2 2027. Until then, quarterly noise — one-off storage margins, EV volume declines and transformation costs — will dominate the tape.