Adrigo Monthly Report January 2026

Performance

Adrigo Small & Midcap L/S Class A and Class C declined by 4.5% during January after fees. The Carnegie Small Cap Return Index Nordic fell by 2.5% in January. Carnegie Small Cap Sweden declined by 4.2%.

For January, among the fund’s larger holdings, Frontline (shipping), Pierce Group (e-commerce) and Hansa Biopharma (pharmaceuticals) were positive contributions. Among the fund’s small and mid-sized positions, there were  good contributions from Arctic Falls (services) and Bonesupport (medical technology). The fund’s short positions as a group had a negative impact on performance.

Adrigo Small & Midcap L/S Class A has, since inception and after fees, returned 40%. Over the same period, the comparison rate STIBOR 1M has returned 9.8% and the Carnegie Small Cap Return Index Nordic (not a benchmark index) has returned 105.4%.

Market Overview

Global equity markets showed positive performance during December. Namely, emerging markets were particularly strong, as illustrated by Korea whose index rose by 28%. The MSCI EM increased by 8.8%, with Brazil, Taiwan and the Hang Seng Index also delivering strong returns. The Euro Stoxx 50 rose by 2.8%, while the S&P 500 recorded an increase of 1.5%. The Nordic markets also performed well, with Denmark leading with a gain of 6.5%. Norway rose by 4.3%, while Sweden and Finland increased by 3.3% and 1.8% respectively. Small-cap stocks continued to develop weakly, with Swedish small caps (CSX Sweden Small Return) declining by 4.2%.

Companies and Performance Highlights

Several mid- and large-cap companies reported during the period. Among the fund’s holdings, the reports from Getinge and Dometic triggered sharply negative market reactions. In our view, these movements were largely driven by liquidity effects on reporting days, which have been amplified by continued outflows from small-cap funds. We have seen this pattern persist during the first part of February.

Getinge’s report was in line with our expectations but slightly below consensus estimates. The share price was heavily penalised, declining by 6% on the reporting day and has not yet recovered. We continue to argue that the market is overlooking the significant underlying improvement within Getinge. Despite headwinds from tariffs and currency amounting to approximately SEK 1,050 million, the company delivered an unchanged EBITA margin of 14%. Excluding currency and tariff effects, the EBITA margin increased from 19.4% in 2024 to 20.3% in the fourth quarter of 2025. Getinge guides for organic sales growth of 3–5% and expects further margin expansion despite continued pressure from tariffs and currency, particularly during the first half of the year.

The key to a re-rating of Getinge shares is quality. The company has struggled with quality-related issues for nearly ten years. Chief Executive Officer Mattias Perjos has worked methodically to address these issues, and the long lead times in the sector have meant that progress has taken time. However, significant steps were taken during 2025, and 2026 should be the final year in which costs related to quality upgrades are noticeable. Despite currency and tariff headwinds, management considers the EBITA margin target of 16–19% by 2028 to be fully achievable and does not rule out reaching the upper end of the range. Strong cash flows provide Getinge with resources for acquisitions, and we can note that the two most recent larger acquisitions, Healthmark and Paragonix, have been highly successful both in terms of growth and underlying margin improvement.

Dometic was also heavily penalised on its reporting day, falling by just over 17%. Organic growth remained negative at -3%, marking 16 consecutive quarters of negative growth. Chief Executive Officer Juan Vargues remains cautious and does not foresee any strong growth during 2026. Nevertheless, there were several positive signs during the quarter, also reflected in reports from other companies in the sector. What impresses us is that despite substantial volume declines, the company continues to deliver stable margins and solid cash flows. Once volumes recover, the company will benefit from strong operational leverage, particularly given the significant cost reductions implemented in recent years. The share is currently trading around SEK 40, and we see considerable potential over the coming years.

In our previous letter, we wrote at some length about our view on Frontline. January proved to be a very strong month, with day rates for the company’s fleet well above USD 100,000 per day. This is significantly higher than normal January levels and reflects a very tight supply situation, with additional vessels having been sanctioned by the US and Europe. The strong cash flows are distributed quarterly, and we have high expectations for 2026.

All figures are stated in SEK and returns are reported net of fees, unless otherwise stated.