Alcadon Group reported a 17% year-over-year increase in adjusted EBITA to SEK 27 million for the third quarter of 2026. Its EBITA margin edged up to 7.1%, and the company said all seven subsidiaries contributed positively to profitability for the first time.

The Swedish distributor also recorded profit over working capital of 38%, a company record and an increase of six percentage points from a year earlier. The measure reflects how effectively the group uses working capital, which is mainly tied to inventory in its distribution business.

Chief Executive Fredrik Valentin said the latest results mark the sixth consecutive quarter of earnings growth since the company restarted operations in 2025. Management described demand as strong across its markets, particularly for data center products and projects. High-volume projects supported growth but put some pressure on gross margins.

Alcadon said cost of sales fell below 18%, while its net debt ratio remained at 2.3 times for a third consecutive quarter. That is below the company’s 3-times limit and, according to management, leaves room for further acquisitions. The group is targeting businesses with annual EBITA of SEK 10 million to SEK 20 million and margins well above 10%.

Operating cash flow was slightly negative during the quarter. The company attributed this to a deliberate increase in inventory intended to help meet customer demand amid supply constraints and longer lead times. Management identified glass fiber as the most constrained material, with steel and metal construction also presenting bottlenecks.

The 7.1% margin remains three percentage points below Alcadon’s long-term 10% target. Its other stated goals include annual profit growth of 10% and profit over working capital above 50%. Management said improving margins will require continued operational work as well as acquisitions.

The company said its exposure to the broadband market has declined as it broadens its business into areas including data centers, cloud computing and AI infrastructure. It noted that broadband demand remains weak in some markets, particularly the U.K. and the Netherlands, while data center demand is growing. Alcadon did not provide revenue or earnings-per-share figures in the materials reviewed, so a comparison with analyst forecasts was not available.

Sources: Investing.com News.