Alimak: A Better Order Book, a Worse Underlying Margin

Order intake rose 16% and the margin ticked up to 17.8% — but strip out Pro-Bel and the core business shrank, with Construction collapsing to 6.9%.

ALIG.ST · Earnings Call · 2026-10-23

The arithmetic behind a "resilient" quarter

Alimak Group opened its Q3 2026 call with the framing that has become standard for European industrials in this cycle: solid intake, resilient profit, challenging market. Order intake of SEK 1,789m rose 16%, or 4% organically, and four of five divisions grew. Revenue of SEK 1,783m was up 8% reported but down 2% organically — a book-to-bill just above 1.0 that flatters a shrinking top line. Adjusted EBITA of SEK 318m lifted the margin to 17.8% from 17.3%. Then the CFO, Sylvain Grange, put the number that matters on the table: “Excluding Pro-Bel, the margin was 16.8% in the quarter versus 17.3% in Q3 2025.” — Sylvain Grange, CFO · 2026-10-23 So the headline margin expansion is an acquisition artifact. Pro-Bel, the Facade Access bolt-on that added 60 basis points of gross margin and pushed that division's EBITA margin to 18.3% from 13.0%, is carrying a group whose legacy operations — and specifically its construction-exposed operations — are going backwards. That is the tension of this report: an order book that is genuinely improving, funded by a mix that earns less, sitting on top of a division whose margin has halved.

Construction: a purposeful retreat from tall buildings

The Construction division is the wound. Order intake of SEK 398m rose 10% (6% organic) on strength in India and Australia — where Alimak runs its own rental fleet and therefore owns the customer relationship — but revenue fell 9% organically and EBITA halved. “EBITA at a disappointing SEK 22 million, down from 44, giving a margin of 6.9% versus 13.3%.” — Ole Kristian Jødahl, CEO · 2026-10-23 Management's explanation is unusually candid and, read carefully, is a strategy document rather than an excuse. The CEO, Ole Kristian Jødahl, argues the tall building market — the historic heart of the Facade Access franchise — never recovered from the pandemic and is now structurally impaired by higher rates: “the tall building market has been extremely slow since actually the pandemic hit. It has never really come back, because also the interest rates affect that.” — Ole Kristian Jødahl, CEO · 2026-10-23 Alimak is deliberately walking away from the low- and medium-height end of nothing — rather, it is walking toward lower and medium-height buildings, refurbishment, retrofit and infrastructure, and away from the megaproject bidding war. That refusal is the most quotable thing on the call. On a market where the few remaining tenders are contested by desperate rivals: “They are not making money. They are just completely desperate. We know that.” — Ole Kristian Jødahl, CEO · 2026-10-23 It is an aggressively honest defence of price pressure discipline — and it means reported order intake will keep underperforming the market's gross activity for as long as the tall-building drought lasts.

The order book is rented, not sold

Analyst Andreas Koski of BNP Paribas made the sharpest observation of the session: three quarters of Construction order intake sum to roughly SEK 1.2bn against less than SEK 1bn of sales. Sales must therefore inflect. Jødahl agreed — then immediately dismantled the obvious inference, because the mix of that order book is the trap:

The main parts or the tick up in the order book is rental order intake mostly, which carry a lower margin and also a little bit lower now also, I would say, than normal because the price pressure in that market is immense.
Ole Kristian Jødahl, CEO · 2026-10-23

The rental business is what is holding up — a defensive, own-fleet activity in Australia that is winning volume precisely because rental customers are refusing to reinvest in new machines. Meanwhile the Skellefteå factory, which serves European and North American rental buyers, is running at low volumes and producing what Jødahl calls "an enormous negative leverage." Translation: the revenue recovery, when it comes, arrives at a worse margin than the revenue it replaces. He was explicit that the positive drop-through only returns "first when we start to see machines coming back in Europe and North America."

The response: SEK 80 million and a new operating structure

With profitability ambitions missed for several quarters, management launched a cost programme in the quarter covering four of five divisions plus group functions (Wind, at 19.2% margin, is too lean to touch). The annual savings target is SEK 80m, with full effect from Q2 2027; one-offs total around SEK 40m, of which SEK 15m of restructuring hit Q3 within SEK 18m of items affecting comparability. Construction's costs come down first, from Q4; Facade Access contributes a further SEK 20m. Karin, six months into running Construction, has reorganised ownership of mast-climbing platforms versus light equipment and rental versus direct sales. Jødahl conceded the reorganisation itself created short-term inefficiencies and that these should not recur — a classic admission that some of the 6.9% margin was self-inflicted.

The macro villain is the same one everyone else is naming

Here Alimak stops being a company story and becomes a read-through. The two external forces management cites — a construction market suppressed by interest rates, and a Middle East war that has frozen oil-and-gas project activity, hitting Facade Access and Industrial — are precisely the themes dominating the global keyword tape this quarter, where Fed rate hike sits at the very top of the market's curated agenda. Alimak's own words: “we also continue to see rising interest rates. To expect a short-term change in the market is not there.” — Ole Kristian Jødahl, CEO · 2026-10-23 The Middle East conflict is the second leg, and the detail is more interesting than the headline: Gulf projects are at a "full standstill" for six months, and even the aftermarket is hurt because operating sites are running flat out and skipping overhauls. The offsetting positive is that the pain is now well telegraphed: two consecutive quarters of order intake growth, three of positive book-to-bill, and — per Jødahl — “signs that we might have seen the worst when it comes to order intake” — Ole Kristian Jødahl, CEO · 2026-10-23. Notably, Wind and Industrial are the offset engines: Industrial at 24.6% margin with organic intake up 11% on mining, ports and North American power; Wind at 19.2% with revenue up 23% organically on backlog, plus a genuine aftermarket tailwind as 20-year-old lift designs come due for full overhaul.

The balance sheet is now the constraint

Pro-Bel was not free. Net debt jumped to SEK 3.8bn from SEK 2.6bn at the end of Q2, and leverage rose to 2.82x reported — 2.60x including twelve months of Pro-Bel earnings — against a stated sub-2.5x target. Grange framed deleveraging as "our number one capital allocation priority," which puts a governor on further M&A, caps buybacks, and makes the working-capital swing a live issue even though he attributed the SEK 57m build to Pro-Bel's below-normative opening working capital and a late-September revenue skew rather than operational slippage. Operating cash flow held at SEK 196m; ROCE rose to 22.9% ex-goodwill but remains 9.3% including it, a reminder of how much goodwill this roll-up carries.

What to watch

The story for the next two quarters is narrow and testable: does European and North American new-equipment demand reappear before the rental-led order book converts into revenue, because if it does not, Alimak books growth at a dilutive mix while its cost savings are still ramping. The Facade Access franchise already shows the answer if the tall-building market stays frozen — lower order intake against a rising headline, with profitability rescued by acquisition rather than by the core. A 17.8% margin that is 16.8% without Pro-Bel is the sort of number that gets remembered when the next quarter does not carry an acquisition tailwind.