Mips AB

Q2 net sales increased 72% year over year, with 42% organic growth; gross profit increased 71% and gross margin was 74.1% versus 74.2% last year. Adjusted EBIT increased 98%, and adjusted EBIT margin was 46.7% versus 40.4% last year. Operating cash flow was SEK 62 million versus SEK 18 million last year. For the first six months, net sales rose 53%, organic growth was 35%, gross margin was 72.9% versus 73.2%, adjusted EBIT margin was 41.4% versus 35.1%, and operating cash flow was SEK 80 million. Cash and cash equivalents were SEK 187 million at end-June; the company also paid a SEK 66 million dividend in April, or SEK 2.5 per share, and had SEK 300 million drawn on its revolving credit facility. Forward-looking comments: management said it expects Europe to continue strong through the year, is betting on a flat U.S. market for the rest of 2026, sees Koroyd on track for at least SEK 120 million in 2025 sales, and said safety sales should reach SEK 100 million for the year. Management also said the U.S. legal settlement cost will be recognized in Q3, with roughly a few million kronor in additional legal fees on top and a total Q3 impact that could be around SEK 35 million.

CEO Max Strandwitz emphasized broad-based momentum across all categories and geographies, with Europe still strong, North America better than expected, and Asia recovering. He highlighted the Koroyd acquisition, the new firefighting helmet partnership with Dräger, and the settlement of the U.S. legal dispute as important strategic milestones. His tone was upbeat but measured, repeatedly saying the company remains focused on long-term targets and a scalable business model.

CFO Karin Rosenthal focused on the quarterly bridge in profitability and cash generation. She said gross profit rose 71%, gross margin was 74.1%, adjusted EBIT margin was 46.7%, and operating cash flow was SEK 62 million in the quarter; for H1, operating cash flow was SEK 80 million and cash on hand was SEK 187 million. She also noted legal costs of SEK 12 million in Q2, transaction costs of SEK 1 million, and that the $3.25 million settlement will affect Q3, with additional legal fees expected on top.

Analysts pressed on whether the U.S. market was stabilizing, and management said market volume appears flat rather than declining, with premium still strong and lower price points improving due to inflation. Questions on margin dilution from Koroyd led management to say Koroyd is profitable but has a lower margin than legacy Mips; the combined business still produced a 46.7% adjusted EBIT margin, and the company said it aims for about 70% gross margin over time. Analysts also asked about Q3 expenses and the safety ramp, and management said trade-fair costs should not be a major issue, the safety business is on track for SEK 100 million this year, and growth is still being driven mainly by head protection with future expansion into body protection, gloves, and footwear.