Epiroc AB (publ)

Orders received increased 13% organically to SEK 17.3 billion, with equipment orders up 30% organically and service orders up 6%. Revenue rose 10% to SEK 16.7 billion, or 11% organically. Reported EBIT was SEK 3.3 billion, up 17%, for a margin of 19.9% versus 18.7% a year ago; adjusted EBIT was SEK 3.35 billion, up 12%, with an adjusted margin of 20.1% versus 19.7%. Equipment & Service revenue increased 12% to SEK 12.8 billion, with a 23.1% operating margin; Tools & Attachments revenue increased 5% to SEK 3.9 billion, with a 12.7% operating margin. Operating cash flow was SEK 1.9 billion versus SEK 1.1 billion last year, cash conversion was 93%, net debt was SEK 11.4 billion, and net debt/EBITDA was 0.75. For tax, the effective rate was 23.9%, within the 22%-24% guidance. Forward commentary: management expects mining demand to remain high and infrastructure demand to increase somewhat; Håkan also said equipment revenues are expected to remain strong into the second half of 2026.

Helena Hedblom framed the quarter as evidence of strong customer activity, especially in mining, and said this was the ninth consecutive quarter of organic order growth. She emphasized Epiroc’s innovation agenda, including automation, digital, electrification and sustainability solutions, and said customers value the company as a long-term productivity partner. On outlook, she said near-term mining demand should stay high and infrastructure demand should improve somewhat, while remaining optimistic about the pipeline.

Håkan Folin focused on the financial execution: revenue up to SEK 16.7 billion, EBIT up to SEK 3.3 billion, adjusted EBIT at SEK 3.35 billion, and adjusted margin at 20.1%. He said the margin improvement came from efficiency measures and high invoicing, with tariffs less of a drag than in Q1 and currency still a headwind. He also highlighted operating cash flow of SEK 1.9 billion, 93% cash conversion, net working capital of SEK 24.9 billion, and net debt of SEK 11.4 billion, with leverage at 0.75 and ROCE at 19.3%.

Analysts pressed management on service mix, asking whether a lower share of mid-life rebuilds would pressure Q3 margins; Helena said the mix difference was mainly in orders, not revenue, and that mid-life work is spread over several months. Questions on equipment margins and utilization led management to say there will always be mix effects when equipment invoicing is high, but the factory ramp-up is working and capacity is being added through extra shifts and dual-site production. Analysts also asked about aftermarket growth, large orders, tungsten costs, and FX; management said service growth can vary quarter to quarter, tungsten was more or less negligible in Q2 after being a >1 point hit in Q1, and FX should be less of a drag if current rates hold steady.