Alleima shares fall 11% after third-quarter results miss expectations
Key Facts
Alleima shares fell 11% on Monday, October 26, after the company reported third-quarter results that missed analysts’ expectations, according to Investing.com. The share move followed the release of the results, signaling the market’s response to the gap between actual performance and earlier estimates. Before the announcement, the FactSet consensus, based on 6 estimates, forecast adjusted operating earnings of 244 million Swedish crowns and revenue of about 4,372 million crowns. Investing.com said the results fell short of analysts’ expectations. Chief Executive Göran Björkman and Chief Financial Officer Johan Eriksson were scheduled to present the results in an online conference and call for investors, analysts and financial media at 1:00 p.m. Central European Time that day.
During the session, the shares fell 12.3% to 98.85 Swedish crowns, after opening at 113 crowns and touching 96.10 crowns, according to another Investing.com report. This session decline differs from the 11% drop cited in the other Investing.com report; the two figures reflect separate measures of the share’s move on the results day. The report said the revenue miss was central to the reaction, while FactSet estimates showed analysts had also expected a specific level of adjusted operating earnings. Investors therefore faced a comparison not only between sales and estimates, but also between operating earnings and forecasts. The shares had fallen about 10% in January after fourth-quarter 2025 results missed on revenue amid currency pressures, according to Investing.com.
Alleima attributed part of the pressure on earnings to lower volumes in its oil and gas tube business, known as OCTG, which increased the impact of underutilized production capacity. The company also said output in its nuclear energy business was below plan during the quarter. This means the decline in operating earnings was linked to operational factors in two businesses, alongside weaker revenue. In a statement published on Cision, management said earnings were negatively affected by "lower volumes in the OCTG business, leading to increased effects from lower capacity utilization." It added that "the production rate in the nuclear business was lower than planned during the quarter."
The company said weaker organic revenue reflected continued weakness in OCTG, as well as a slowdown in the Chinese market, which had previously been strong in the chemicals and petrochemicals sectors. By contrast, the industrial heating and medical segments continued to develop positively, according to Alleima’s statement. The divergence highlights different demand trends across the group’s businesses during the quarter: pressure in oil and gas and in China’s chemicals market, against positive performance in industrial heating and medical products. Management specifically cited "the slowdown in the previously strong Chinese market" in explaining the performance of the chemicals and petrochemicals segment. It also said OCTG activity remained weak, affecting organic revenue and capacity utilization.
On a more positive note, Alleima said its Kanthal division delivered another quarter of profitable growth, supported by good demand for electric heating solutions used in electronics and semiconductor applications. It added that medical products, including products used in diabetes treatment, also supported demand. These indicators set Kanthal’s performance against the pressures facing other businesses, without offsetting their impact on overall results. The company described the division’s performance as "another strong quarter of profitable growth" and linked it to demand for electric heating solutions and medical products. The industrial heating and medical segments had continued to develop positively during the quarter, the company said.
Orders faced an additional headwind during the quarter after the cancellation of an order worth about 250 million Swedish crowns, which had been scheduled for production in the fourth quarter of 2026. Alleima said the cancellation was included in negative new orders in the third quarter. This came as the company reported continued weakness in OCTG, while the chemicals and petrochemicals sector faced a slowdown in China. On the other side of the demand picture, management said it had received several orders in the nuclear energy segment after the quarter ended, covering multiple product categories. It said these orders strengthened its confidence in long-term growth opportunities in the nuclear market.
Alleima said the nuclear orders received after the quarter ended covered several product categories, but the available information did not give their value or production timing. The company said these developments strengthened its confidence in long-term growth opportunities in the market, at a time when the effects of weak OCTG, the Chinese market slowdown and the large order cancellation were reflected in quarterly results. The scheduled presentation of the results and call with investors and financial media was at 1:00 p.m. Central European Time on October 26, with Björkman and Eriksson taking part. The call was part of the program to present the third-quarter interim report. No further details on management’s guidance for the next quarter were provided in the available information.