Axactor ASA

Hello everyone, thank you for joining us and welcome to the Axactor ASA presentation of second quarter 2026 results. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. If you have logged in via the webcast, please use the Q&A button to submit your questions. I will now hand to the conference over to Johnny Tsolis, CEO at Axactor. Please go ahead.

Good morning and welcome to Axactor's second quarter presentation. With me today, I have our CFO, Nina Mortensen. This presentation will be divided into four parts. First, I will take you through the main highlights. Then Nina will present the financials before I will go through key focus areas going forward. We will round off with a Q&A session. This time, I will focus on the two most important events in the quarter. Firstly, the equity transaction and its main elements, and secondly, the result of the book value assessment that was previously announced. Please move to slide three. As the main elements in the transaction are well known, I will not spend too much time repeating these, but rather focus on the results and where we stand. We raised a total of 215 million in new equity divided on 200 million in the private placement and 15 million in a successful subsequent offering. I'm happy to say that everyone that subscribed in the subsequent offering got full allocation, including any request for oversubscription. Hence, it is clear that the maximum subsequent offering of 20 million was more than enough to cover all demand from existing shareholders. The co-investment structure with Fortress is now up and running, with the legal structure established and the first investments through the vehicle already closed in July. The sale of the seed portfolio is conducted to a newly established SPV, where Axactor owns 51%, and we have received the first 50 million euros in proceeds. The remaining will be settled in Q3. Just before summer, we placed a new 100 million euro bond, with 4.25 years tenure at Eurobor plus 390 bps margin. This was record low for X-Aktor, confirming the strong market confidence in the company's transformation. During June, the bond ACR03 was repaid in full, while also partial ACR04 was repaid in connection with the latest bond placement. To summarize, we are fully on track on the transaction and we are now ready to focus on investment growth in combination with replacing the current bond structure with new bonds at better terms. Let's have a look at our debt structure on the next page. As a result of the transaction, the net debt has been significantly reduced. This was, in addition to increased investment capacity, the main motivation for the transaction in the first place. Our net debt is now at 559 million euros down from 837 million euros by the end of Q1. The proceeds from the equity issue and the seed portfolio sale has been used to call the remaining parts of ACR03 and to reduce the RCF draw. The leverage ratio has been reduced to 2.3 when adjusting for the remaining 50 million euros proceeds from the portfolio sale that will be settled later in Q3. We expect to refinance the outstanding part of ACR 04 in September this year, most likely using a combination of existing funds and a new bond placement. However, the latter is depending on market conditions. Let's move to the second major highlight from Q2, the result of the book value assessment. Please turn to page five in the presentation. Let me spend one minute on the background. If you look at the curve on the left hand side and focus on the upper curve, which represent our active forecast per 31st of December 2025, you can see that it is increasing before it starts to decrease between 2027 and 2028. In order for us to reach this curve, we have anticipated a number of improvements in relevant macroeconomic factors. For example, that Germany should be out of recession, interest rates should go down instead of up, inflation down, etc. We had also expected certain regulatory factors to improve. As we moved into 2026, it gradually became clear that these improvements were not materializing as expected, and in Q1, the unsecured NPL collections fell to 89% of active forecasts. Unfortunately, the unsecured NPL collections has continued to fall compared to the active forecast in the second quarter and would have been down to 81% performance in Q2 if no curve adjustments had been done. As we announced in April, we initiated a full assessment of our backbook to address the decline in collection performance. During this assessment, we have revised all our underlying assumptions and implemented this into an improved and more data-driven model. This model has been enabled by obtaining more and better collection data as the company has matured over the years. The result of the assessment is less expected collections and a differently shaped collection curve, as you can see on the graph to the left. And the decay rates are aligned with the market. We have also illustrated how the new collection curve looks compared to the actual unsecured collection the last 18 months marked as actual collection. The new curve will obviously translate into a significantly negative revaluation for the unsecured NPL book. I will go through more details on the next slide. The total negative revaluation amounts to 320 million euros corresponding to 33% of the unsecured NPL book value. The amount is approximately 10% lower than Fortress pricing assumptions in relation to the private placements. If we deep dive a bit more into the vintages affected, pre-2021 vintages and the German 2021 vintage counts for 92% of the total revaluation. Norway and Sweden have the largest adjustments both in nominal terms and relative to book value. Spanish secured portfolios are still overperforming and is not part of the process. Unsecured collection performance was lifted to 102% in June after implementing the new curves. Axtractor expects future collection to be in line with collection curves and hence no further revaluation will be needed. With that I leave the word to Nina for the financial update.

Thank you, Johnny. So now I'll take you through the Q2 financial performance, starting with the overall figures and then a bit more context on what is behind the numbers. Gross revenue for a group ended at 78 million euros in the quarter, down 4% compared to the second quarter of 2025. And as I also explained in the Q1 report in May, the decline is largely due to the portfolio sales in Spain and Germany last year and limited and failed investments. The NPL segment reported a gross revenue of 62 million euros. Excluding their portfolio sold last year, the segment gross revenue decreased 4% compared to Q2 2025. The CPC segment continued to deliver well, with a solid top line of 16 million euros, up 3% from the second quarter last year. Let's look a bit more into details on each of the business segments, starting with NPL on the next slide. As Johnny explained earlier, the NPL segment was heavily impacted by the negative valuations of 320 million euros in the quarter, and total revenue for the segment ended at negative 274 million euros. The NPL collection performance, including both unsecured and secured portfolios, ended at 93% for the quarter, Please note that the reported collection performance includes the updated curves with effect from June, while April and May are reported based on unadjusted collection curves. While the unsecured portfolios have been underperforming, the secured portfolios continue to perform strongly this quarter. The MPN investments were 19 million euros in the second quarter and 55 million euros so far this year. Portfolio Investments are expected to pick up with the significantly improved investment capacity. The higher investment capacity comes from both the proceeds from the equity raise, but also through establishment of the new co-investment structure with Fortress. Please turn to the next slide for comments on the development in the CCC segment. The CCC revenues ended at 16 million euros for the quarter, up 3% from the corresponding quarter last year. As for Q1 last year, the second quarter of 2025 also saw positive one-off impacts on a specific contract in Spain, impacting the growth for this quarter. Adjusted for this one-off impact, the underlying year-over-year growth was 5%. The growth is predominantly driven by new contracts in Norway and a strong performance in Germany. The Norwegian landmark deal is performing very well, but it's experiencing some minor delays in onboarding of certain key segments. The contribution margin ended at 36%, up from 31% in the second quarter 2025. The contribution margin is improving through both the revenue growth along with lower operating expenses. It is important to mention that AXACTO receives excellent feedback from our clients on our tailored high quality deliveries. The pipeline for new clients remains strong across geographies and further growth is expected for the segment going forward. The capitalized servicing will also benefit from both the co-investment vehicle and the seed portfolio sale, as AXACTO retains exclusive servicing rights for both vehicles. Let us move on to the next slide where I present more details on the reported financials for the group. Due to the negative valuation booked this quarter, total revenue at group level ended negative €258 million, with EBITDA at negative €290 million. The corresponding figures for the second quarter last year were total revenues of €64 million and an EBITDA of €33 million. The cash EBITDA was at a good level for the second quarter this year, ending at €46 million. As a final remark, we have initiated a review of the segment reporting structure. The capitalized servicing will now benefit from both the co-investment vehicle and the seed portfolio sale, and the segment reporting will be adapted to better reflect the impact of these changes. We expect to report according to the new structure from the next quarter. With that, I'll now hand it back to Johnny for some additional comments on the key focus areas going forward.