Continued positive margin development

Margins continue to strengthen
During 2025, the structured work to improve margins has continued with the highest priority. The work is carried out on an ongoing basis in all companies and, in certain selected companies, with particular focus and with clear action plans. The activities mainly include efficiency improvements, pricing, increased service content, a shift in product portfolios towards more advanced and profitable products, as well as a higher share of proprietary products.

During the quarter, margins continued to improve even compared with the strong fourth quarter of the previous year. For the full year, the margin rose significantly to 12.1 percent from 11.3 percent in the previous year.

In Labtech, the margin was maintained at 14.1 percent, the same high level as in the fourth quarter of the previous year. For the full year, the margin increased to 12.5 percent compared with 11.7 percent in the previous year.

In Medtech, the margin strengthened in the fourth quarter to 12.0 percent compared with 11.6 percent in the previous year. For the full year, the margin increased to 12.4 percent compared with 11.6 percent in the previous year.

Positive sales development
Currency effects had a negative impact on sales and the currency-adjusted organic growth amounted to 1 percent compared with the strong fourth quarter of the previous year. Acquisitions contributed an additional 1 percent. For the full year, currency-adjusted organic sales grew by 3 percent and acquisitions contributed a further 1 percent.

Net sales in Labtech declined slightly in the quarter, partly due to weaker sales in Denmark. Instrument sales were also lower than in the previous year, when many instrument deliveries linked to won tenders took place. For the full year, Labtech grew organically by 5 percent.

Market developments in the United Kingdom, one of AddLife’s largest markets within Medtech, were weak during the year, with

subdued capital investments and relatively weak development in elective surgery. However, in the fourth quarter we saw signs that capital investments are once again increasing in the United Kingdom. The number of surgical procedures performed was adversely affected by healthcare strikes in the United Kingdom and also in Spain during the month of December.

During the year, a number of products were removed from the Medtech product range. This was done primarily to increase the focus on more advanced products and improve margins, but it also dampened sales growth, which for the year amounted to 2 percent organically, with acquisitions contributing an additional 1 percent.

Strong cash flow and significantly strengthened balance sheet
A strong cash flow is an important component of AddLife’s business model, enabling high self-financed organic and acquisition-driven growth. In recent years, AddLife’s cash flow has improved significantly, and this positive development has continued in 2025. The year ended with very strong cash flow of SEK 888 million, an increase of 33 percent compared with the fourth quarter of the previous year. Net debt (net debt/EBITDA) was reduced during the year from 3.2 to 2.2. The ambition to reduce the leverage ratio below 3.0 has thus been achieved and exceeded, and through internal improvement measures, AddLife again has a strong balance sheet.

Increased acquisition activity
In parallel with initiatives to drive organic growth and profitability, AddLife has during the year completed three acquisitions. The acquisitions are relatively small but have great potential. They are in line with the strategic direction and established criteria and demonstrate that AddLife has increased its acquisition activity. The strong cash flow and robust balance sheet mean that in 2026 AddLife will be fully able to execute its growth plan for both organic and acquisition-driven growth. Preparations to return to a full acquisition pace have been underway for a long time, and AddLife is continuously running a number of acquisition processes in parallel.

Positive outlook for 2026
The overall market trends are expected to persist in 2026. The need for healthcare is steadily increasing, regardless of economic cycles. Staff shortages remain a challenge for customers, particularly in healthcare and diagnostics. Current market developments are expected to drive interest in more advanced products and services that streamline care processes and deliver better clinical outcomes. The companies within AddLife have strong customer relationships and a competitive service offering, which creates confidence in their ability to deliver and support the implementation of advanced products. Suppliers of new technologies are seeking distribution partners in Europe, while some established suppliers are abandoning direct sales in certain segments and countries. In summary, AddLife’s companies are in a favorable position, and we see many opportunities in the current market situation.

As we look ahead to 2026, uncertainties related to geopolitics and global trade remain, but AddLife is well positioned with a regional business. More than 95 percent of sales take place within Europe, over 80 percent of our products are sourced from European suppliers, and we have agile companies that have proven their ability to handle changes in market conditions.

Fredrik Dalborg

President and CEO