Loomis AB (LOIMF) Q1 2025 Earnings: A Glimmer of Growth Amid Global Headwinds

Loomis AB’s first-quarter 2025 earnings call, released on May 7, 2025, painted a picture of resilience amid global economic turbulence. The Swedish cash logistics and automated solutions provider reported modest revenue growth and margin improvements, even as currency headwinds and geopolitical challenges loomed large. But beneath the surface lies a company executing a bold strategic pivot—one that could position it for long-term gains, provided it navigates its current hurdles.

The Numbers Tell a Story of Cautionary Optimism

Loomis’s Q1 revenue rose 4.4% organically to SEK 7,665 million (approximately $715 million USD), outpacing the SEK 7,253 million reported in Q1 2024. Net income climbed to SEK 382 million, a 6.4% increase year-over-year, while diluted EPS reached SEK 5.56, up from SEK 5.05. A standout was the operating margin, which expanded to 11.6% from 10.4% in the prior year, driven by cost discipline and a shift toward higher-margin services.

But the real story lies in the details. Cash flow remained robust, with operating cash flow hitting 112% of EBITA for the quarter—evidence of Loomis’s ability to convert earnings into liquidity. Yet this financial resilience is being tested by external forces.

The Strategic Gamble: Acquisitions and Global Ambitions

The star of the call was the announced acquisition of Burroughs, an American firm specializing in ATM and automated solutions. This move aims to bolster Loomis’s U.S. presence, a market it has long targeted. CEO Aritz Larrea framed the deal as a “strategic cornerstone” for growth, despite acknowledging it would initially dilute margins. The hope is that synergies and cross-selling opportunities will eventually make it accretive—a classic high-risk, high-reward play.

Yet Loomis’s ambitions face immediate obstacles. Its European Automated Solutions division reported declines due to tough prior-year comparisons, while Latin American and European segments were battered by currency fluctuations. Meanwhile, U.S. tariffs have stalled export plans for its CIMA brand, casting doubt over near-term revenue streams.

The Elephant in the Room: Currency, Costs, and Tariffs

The earnings call did not shy away from challenges. CFO Johan Wilsby highlighted that negative exchange rate effects shaved 2.5% off total growth, with European and Latin American segments particularly vulnerable. Restructuring costs, too, are set to rise in 2025, as Loomis overhauls operations in key regions.

Perhaps the most ominous warning came from Larrea: “The U.S. tariffs on CIMA products have created uncertainty about our export plans.” This is no minor issue. CIMA’s export business accounted for 15% of Loomis’s revenue in 2024, and tariffs could crimp both profitability and market share if unresolved.

What the Data Says—and What It Doesn’t

Loomis’s stock has traded in a narrow range since early 2024, reflecting investor ambivalence about its growth trajectory. While the Q1 results were broadly positive, the market may still be pricing in the risks—currency volatility, regulatory uncertainty, and the time lag before the Burroughs acquisition delivers returns.

Conclusion: A Buy With Caveats

Loomis’s Q1 results suggest a company capable of executing its core operations efficiently, even as it grapples with external headwinds. The Burroughs deal, if successful, could unlock significant value in the U.S. market, where Loomis’s automated solutions are in high demand. The 4.4% organic growth and 11.6% operating margin demonstrate that Loomis isn’t standing still.

However, investors must weigh these positives against the risks. Currency fluctuations could persist, tariffs remain a wildcard, and restructuring costs may eat into short-term profits. For long-term investors willing to bet on Loomis’s strategic vision—and its ability to navigate geopolitical storms—the stock could be a diamond in the rough. For those with shorter horizons, the path is murkier.

In the end, Loomis’s Q1 performance is a reminder that growth, even in turbulent times, isn’t impossible—it just requires bold moves and a tolerance for risk.