Engcon AB (ENGCF) Q4 2025 Earnings Call Highlights: Strong Sales Growth Amid Margin Pressures

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Wed, February 18, 2026 at 12:00 AM GMT+9 3 min read

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**Net Sales:** SEK 498 million, a 34% organic increase year-on-year.

**Order Intake:** Increased organically by 12% from SEK 506 million to SEK 539 million.

**Gross Margin:** 40%, down from 43% last year.

**Operating Margin:** 15%, slightly lower than the previous year.

**EBIT:** SEK 72 million, an increase of around 15%.

**Return on Capital Employed (ROCE):** 36%, below the target of 40%.

**Dividend Proposal:** SEK 1 per share to be paid in 2 equal installments.

**Nordic Region Performance:** Order intake increased by 35%, net sales grew by 37% during the quarter.

**Europe Region Performance:** Organic net sales growth of 39%, order intake increased by 9%.

**Americas Region Performance:** Net sales increased organically by 7%, order intake declined by 13%.

**Asia-Oceania Region Performance:** Net sales increased organically by 33%, order intake declined by 32%.

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Release Date: February 17, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Engcon AB (ENGCF) reported a strong 34% organic increase in net sales for Q4, driven by solid demand in Europe and the Nordics.

The company successfully launched Generation 3, enhancing hydraulic speed, precision, and efficiency for excavators.

Engcon AB (ENGCF) expanded its market presence by establishing a sales company in Japan, supported by government subsidies.

The company increased its market share by 5 percentage points, reaching a 49% market share, indicating strong market leadership.

Engcon AB (ENGCF) achieved a significant milestone by entering the large cap segment, enhancing visibility and investor base.

Negative Points

Gross margin decreased to 40% from 43% last year, impacted by negative currency effects and a less favorable market mix.

Operating margin fell to 15%, affected by a stronger Swedish krona and increased administrative costs related to IT and legal services.

The company faced ongoing legal challenges, including a new lawsuit concerning patent disputes with Rototilt.

Higher costs were incurred due to the implementation of a new ERP system, impacting short-term profitability.

Order intake in the Americas declined by 13%, reflecting a cautious market environment due to tariffs and uncertainty.

Q & A Highlights

Q: Could you elaborate on the impact of not receiving an order from your German partner and whether they are increasing capacity with their new factory? A: Germany is a significant market for us, and the absence of an order from our partner there is notable. They are building a new assembly factory for tiltrotators, which is not yet ready, so they delayed placing orders. This new facility represents a substantial investment, more than doubling their capacity, indicating strong belief in the tiltrotator market in the DACH region.

Story Continues  

Q: How did higher deliveries to Europe affect the gross margin this quarter? A: Europe generally provides good gross margins, although currency effects and specific deals, like those with rental fleets, have slightly squeezed margins. However, Europe remains a favorable market for us in terms of order quality.

Q: What should we expect regarding IT costs moving forward, and what positive effects do you anticipate from the ERP implementation? A: IT costs will remain elevated in Q1 due to ongoing Hypercare, but we expect a significant reduction from Q2 onwards as the project phase concludes. The ERP system will streamline operations and reduce legacy system costs, improving efficiency and cost management.

Q: What are your expectations for order intake in Q1, considering the dynamics in Q4? A: We are optimistic about maintaining solid momentum in Q1, particularly in Europe and the Nordics. While the Americas and Asia-Oceania present more uncertainty, we aim to exceed last year’s performance each quarter.

Q: What measures can you take to push EBIT margins towards the 20% target, and is it feasible to achieve this in 2026? A: We aim to improve margins through strategic pricing, product packaging, and increased volume. The reduction in ERP-related costs post-Q1 will also help. While reaching a 20% margin is challenging, especially with currency fluctuations, we believe it is achievable with the right actions.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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