Revenio Group Oyj

Finland and welcome to revenue group Q3 earnings call. My name is Jouni Toijala, I'm the group CEO and as always with me we have here as well Robin Pulkkinen, our CFO. I'm going to go through the highlights for the quarter. Robin is going to recap the financial performance shareholder and financial guidance for 2025. Q3, so extremely good quarter for us. Top line, 25.9 million, 8.1% growth. From the currency adjusted terms, the growth was 8.7%. Operating profit, 6 million, up 9.1%. If you look where the growth came, so really good quarter in Europe, especially Europe. France, Germany, and UK. They were growing nicely, and the growth was quite a lot dominated also by screening-related device and software sales. Also in the USA, good growth, especially on the dollar terms, but slightly muted because of the exchange rate impact. So Robin is going to cover a bit more detail the foreign exchange rates in the USA and also in the APAC. And APAC fell short of the targets, and the logic mainly was related to the strengthening Euro. So we sell in two currencies, so in USA we sell in USD, and for the remaining part of the world, Europlata and APAC, so we sell on Euro terms. Then, good news from the software solution part, so we also launched the Altius, our data management platform running on cloud in the USA during the review period. If looking the whole first three quarters, so we are currently in the middle of the guidance, so we are going to, of course, reiterate the guidance, so We are on the net sales perspective, 78.5 million reported growth, 7.5% currency adjusted, 9.1% profitability on the good level. And if we look at the other events, so as I said earlier, so we have been able to grow really well the screening-related events hardware and software sales and then also Maya Micro Premier was launched and was in sales already starting from the quarter two. So I hand it over to Robi.

Thank you. So going through the numbers a little bit more in detail. So Lucky Ownish had 8.1% growth in the third quarter and 7.5% for the whole year. Some might have thought the FX impact would have been higher in the third quarter. Actually, if you remember the second half of last year, the FX was quite of a roller coaster. So the third quarter in the comparison period had quite a bit of headwind And then vice versa on the fourth quarter, the last year, we had almost 900,000 of tailwind in the numbers. So looking at the fourth quarter, most likely the FX adjusted growth will be, there will be a bigger difference compared to the reported number. Gross margin at a very good level. There's, of course, dollars is pushing that down but then we do have some costs that used to be posted in the the the variable costs related to commissions that are now in the opex side but also we've had um quite nice good deals uh direct deals where we've gotten a better better sales price and also saved in in some of the the the um outsourced uh com kind of reps commissions um in the us and also in europe so so the sales mix has had a had an impact there um Overall profitability growth in the third quarter and as well as the whole year. So if you look at the adjusted operating profit, up 11%, 11.5%, and for the whole year, 16.1%. Basically, there's been roughly as much adjusted costs in the reporting period as well as the comparison period, so $700,000, $800,000 in both. So in a way, it doesn't really – If you look at the year-to-date number, the adjustments are pretty much as big in both lines. EPS is up this quarter. If you're kind of looking at the third quarter FX rate, so the bigger items when you look at the financial expenses for us is basically the euro against the US dollar and US against Australian dollar. Those were pretty stable throughout the third quarter. So there are... I think the basically very close to zero kind of financial expenses in the P&L. But in the first half, if you remember, there was almost 2.5 million of those. So those do pull down the EPS for the whole year or year to date. So in the third quarter, we didn't have those unrealized FXs. Sales growth in more of a graphical view. um basically um looks pretty similar to what we've seen before i think the fourth quarter always is the the strongest quarter for us that's been at least for the last 10 years or even longer there's no reason why we won't think that wouldn't be the case this year as well and of course we we're looking to to finish finish well the fourth quarter also in in in terms of the guidance to to be able to keep the guidance that requires that we do well in the last quarter as well. EBIT improved. So same thing like the sales, the last quarter of the year typically is the quarter where we make the most profits. Looking at 23, it's roughly 35% of the annual EBIT was done in Q4. Last year, 36% of the EBIT was done in the last quarter. so something similar if we can so the business model is quite scalable so it's really driven by the top line so the OPEX is rather fixed or very fixed so in a way the higher top line drives profitability as well and kind of same for the guidance so with the higher top line to keep the guidance most likely unless something very surprising happens would should mean a very good quarter also from the profitability point of view. Cash flow, so slightly higher than last year. There was some on the working capital, the payable sides went down. We haven't actually had much orders from the contract manufacturers in the third quarter, so that side pulled it down slightly. Also, the finish for the quarter was very strong, so actually the September was clearly the strongest month for the quarter and that resulted in the accounts receivable going up. So those two combined kind of had an impact on the cash flow as a whole for the quarter. The unrealized FX from the first half of the year actually that doesn't have any impact on the operating cash flow. And the balance sheet remains strong and unleveraged, the net gearing is back to negative. So it always kind of jumps up when we pay dividends and then we kind of build the cash balances again and it goes down to negative. So we're approaching again the kind of recent history record highs in the equity ratio, almost 80% of the balance sheet at the end of Q3. And on the shareholders side, William DeMont is still the biggest owner. The whole top 10 list is more or less the same. But William DeMont actually did increase their ownership in the third quarter. So at the end of the second quarter, they were below 22%. So they've bought basically 2.5% more shares during the quarter. The selling side is not really... fully cleared to us yet so the shareholder registers don't show exactly where they bought them but there are some of the bigger owners that don't have verified data for the last day of the quarter yet so probably in the next month or so we should know where those shares came from but basically the Finnish ownership versus foreign ownership is exactly the same as at the end of Q2 and on the country level the The Denmark part, of course, went up while Demand bought more shares, but the other end of that trade is still a bit open in the systems. The guidance, basically unchanged. So the exchange rate adjusted net sales are estimated to grow 6% to 15% from the previous year, and profitability excluding non-recurring items is estimated to remain at a good level.

Thank you, Robin. I think it's time for questions.