Dometic issued its third quarter financial performance report on Thursday, Oct. 23.
Note one Swedish Krona (SEK) is equivalent to $0.11.
Third Quarter 2025 Highlights
- Net sales were SEK 4,885 m (5,647); a decrease of -13%. Organic growth was -6%.
- Operating profit (EBITA) before items affecting comparability was SEK 506 m (483), corresponding to a
- margin of 10.4% (8.6%).
- Operating profit (EBIT) was SEK 375 m (-1,673 including a goodwill impairment of SEK -2,000 m), corresponding to a margin of 7.7% (-29.6%).
- Profit for the quarter was SEK 113 m (-1,921).
- Earnings per share were SEK 0.35 (-6.01). Adjusted earnings per share were SEK 0.64 (0.59).
- Free cash flow was SEK 527 m (713). Cash flow was SEK 2,643 m (-506).
“Dometic delivered strong EBITA margin improvement and good cash flow, despite continuous macroeconomic challenges,” said President and CEO Juan Vargues.
“Net sales for the third quarter totaled SEK 4,885 m (5,647), resulting in an organic net sales decline of -6%, reflecting a continued cautious customer behavior. However, the lower level of decline in the quarter indicates some stabilization, compared to the levels seen in recent years. The Marine segment reported 1% organic growth driven both by the Service & Aftermarket and OEM sales channels, suggesting the market downturn may be bottoming out. Revenue in the Service & Aftermarket sales channel declined by -4% organically, also a notably slower rate of decline. Retailers remain however cautious, maintaining low inventory levels and cautious purchasing behavior as we enter the off-season for many of our products. The Distribution sales channel declined by -6% where Mobile Cooling was impacted by additional retail inventory reductions and labour inefficiencies. In the OEM sales channel, the Marine segment reported net sales growth, while primarily recreational vehicle OEM net sales declined, resulting in an -8% decrease for the total OEM sales channel. Land Vehicles Americas reported single-digit growth. Generally, there was a positive tone and attendance increased at the major trade shows held in the quarter both in the U.S and Europe.
“EBITA in the third quarter increased to SEK 506 m (483), driven by improved performance in the Land Vehicle segment, stable development in the Marine and Global Ventures segments, while EBITA in the Mobile Cooling segment declined. The EBITA margin showed a strong improvement of 1.8%age points to 10.4% (8.6), despite the lower sales volumes. The improvement was largely achieved due to a continued successful execution of the ongoing Global restructuring program, which is delivering savings according to plan, as well as the additional cost reduction activities driven across the Group. In parallel with the cost-reduction activities and capacity adaption in some areas, we continue to invest in strategic growth areas. The Land Vehicles, Marine, and Global Ventures segments all reported margin improvements. The lower EBITA margin in the Mobile Cooling segment was mainly a result of lower volumes as well as continued investments in new product development and in sales and marketing.
“Cash generation remained good, with free cash flow in the quarter amounting to SEK 527 m (713), primarily driven by working capital management. The net debt to EBITDA leverage ratio declined sequentially but increased year-over-year to 3.2x. Net debt continues to decline, driven by the consistent cash generation, and is now down by around one third compared to three years ago. Maintaining a strict focus on earnings and cash flow, we are steadily working towards our net debt to EBITDA target of around 2.5x.
“The development in order intake shows early signs of recovery in some of our markets. The Service & Aftermarket sales channel demand is still somewhat volatile, and consumer behavior is tilted towards downtrading. While there may be pent-up demand, this is partly offset by dealers’ reluctance to increase inventories. In the Distribution sales channel, we’re encouraged by our launch of new cooling products and a reasonably positive trend in order intake. Still, retailers continue to manage inventories aggressively. In the OEM sales channel, we seem to be nearing the bottom of the cycle, though trends vary across segments. Here, Marine and Land Vehicles Americas are leading the recovery.
“We expect positive contributions from investments in new products — such as the award-winning Dometic Recon series of mobile cooling products and the Dometic DG3 Gyro boat stabilizer. The recent interest rate cuts in markets such as the U.S. and Australia are expected to improve consumer confidence, leading to improved market conditions. While we have already announced mitigating price increases to our customers, certain temporary negative effects — due to timing — will impact the fourth quarter. These include import tariffs and regulatory-driven labor cost increases in our Mobile Cooling segment, as well as negative currency effects.
Long-term trends in the Mobile Living industry remain strong and we will continue to relentlessly drive our strategic agenda. The Global restructuring program proceeds as planned, which means that we are placing Dometic in a prime position to deliver on our targets while providing highest quality of services and products to our customers,” said Vargues.
