Frequently asked questions from investors
1. How did the market situation develop in 2025 and how did this affect customer behaviour?
The market situation remained weak but stabilised gradually during the year, helping to break the trend and lead to improved profits during the third and fourth quarters, along with organic growth during the fourth quarter. More project orders from the defence industry and increased demand within the industrial segment made a positive contribution.
The decline in the SME segment slowed, with customers remaining more cautious and continuing to prioritise more acute needs. One clear example was the winter cold, which led to a strong increase in sales of starter batteries, while demand for complementary winter products such as gloves or workwear remained limited.”
2. Which factors affected gross margin in 2025?
Gross margin improved as a result of a more favourable customer and product mix, a stronger focus on sales and assortment management and, to a certain extent, lower purchasing costs due to a more favourable dollar exchange rate.
Alligo’s offering was competitive on the market in the Premium, Mid and Affordable segments, which provided the conditions for an effective pricing strategy and supported margins. In Sweden and Norway in particular, cost adjustments implemented and a strong product mix helped to improve profitability despite a challenging year.
3. How did the work on inventory levels and capital efficiency progress during the year?
Work on capital efficiency intensified, with a focus on reducing inventories and improving cash flow. The build-up of inventories during 2025 was mainly the result of continued investment in own brands and long lead times in procurement processes. Key measures included streamlined procurement volumes, improved sales forecasts and a reduction in the number of low‑turnover products.
These measures began to have a clear effect during the second half of the year, with improved cash flow and a gradual reduction in inventory levels. Balancing the reduction of inventories with good availability of our range remains a priority in 2026.
4. How did Alligo’s debt ratio and financial position change?
At the beginning of 2025, completed acquisitions increased leverage to slightly above the target of maintaining operating net debt below 3 times adjusted EBITDA, excluding IFRS 16. However, the positive profit trend in the fourth quarter helped to reduce the ratio of net operational liabilities to adjusted EBITDA, excl. IFRS 16, to 2.5. The strong balance sheet was reinforced by the refinancing implemented in February 2026, when the credit facility with Handelsbanken was increased by MSEK 500 to a total of MSEK 3,100 and extended to 2029. This also strengthens Alligo’s financial position going into 2026
5. What is the outlook for 2026?
Stabilised demand creates the conditions for continued organic growth for Alligo during 2026. The stronger financial position, improved profitability and greater capital efficiency are expected to contribute to a further reduction in the debt ratio. With increased customer demand, Alligo sees good opportunities to continue to develop towards its financial targets and is focusing in particular on sales, market activities, acquisitions and the restructuring of Tools in Finland