Gn Store Nord A/S Adr

Hello, everyone, and welcome to GN's conference call in relation to a Q1 report announced last night. Participating in today's call is Group CEO Peter Karlstrammer, Group CFO Søren Jelert, and myself, Rune Saner, Head of Investor Relations. The presentation is expected to last about 25 minutes, after which we'll turn to the Q&A session. The presentation is already uploaded on GN.com. And with that, I'm happy to hand over to Peter for some opening remarks.

Thank you, Rune, and thank you all for joining us here today. This is a special call at a special time, given the elevated uncertainty we experience around the world. Today, we will start our presentation with our Q1 highlights, and then we will spend some time at the end of the presentation on how we are approaching the challenges we are facing from the fast-evolving global trade environment. Hopefully, this will provide you with an increased level of understanding and clarity as well as better visibility of the actions we are taking to navigate the situation well. Let me start with the highlights on slide 4. While we acknowledge that our Q1 financial results were influenced by very short-term factors, we are optimistic about the underlying strength of our business and we are confident in the proactive steps we are taking to navigate the uncertain global trade environment. In hearing, the launch of Reason Vivia is progressing well, even surpassing the launch metrics of our previous successful product introductions. We have experienced healthy market share gains in all the markets where Vivia have been launched, which bodes well for our business in the coming quarters. In Q1, we experienced a weak US market and also relatively weak international markets. We also had some slowdown of our business due to the ongoing Vivia launch. We see a stronger momentum in the market in April and we remain confident in our ability to have a strong year in hearing thanks to our promising launches and good execution. In enterprise, we did see positive sellout growth across North America and the rest of the world, in line with what we also saw in Q4 last year. In Europe, we experienced a slowdown in the market, likely related to the global uncertainty. We experienced a somewhat weaker sell-in than sell-out and also had a challenging comparison base as we successfully executed several large deals last year. Despite the challenges, Enterprise has successfully maintained a strong market-leading position by holding share across segments. Thanks to our strong pricing discipline, our margins also have remained robust. In gaming, we continued a strong momentum from Q4, achieving double-digit organic revenue growth once again and gaining market share in a competitive gaming gear market. Furthermore, our strong execution was reflected in our margins, as we delivered a double-digit divisional profit margin during the quarter that typically sees low revenue in margins. Overall, this was a very encouraging development for gaming. On a group level, JIN is taking a prudent approach, implementing the necessary actions to safeguard our business from both the direct and indirect tariffs from the global trade situation. We will cover this further later in our presentation. And with that, I'm happy to hand it over to Søren for group numbers during the quarter.

Thank you, Peter, and thank you all for being here with us today. As Peter mentioned, Q1 presented some challenges and introduced uncertainties on global trade. However, by concentrating on the business factors within our control, GEON executed well under these circumstances. We are actively implementing initiatives that enable us to navigate through a world filled with significant uncertainties. In summary, our organic revenue growth ended at minus 3, excluding the wind down, influenced by a slight decline of minus 1 in hearing and a minus 9% in enterprise due to the sell-in pressures and the high comparison base. This was partly offset by a strong performance in gaming, which achieved 11% organic growth, including the wind down. Our organic growth was minus 8%. While Q1 showed strong improvement in our gross margin, the combination of a challenging top line and launch-driven investments resulted in an EBITDA margin of 8%. Our cash flow was affected by the traditional seasonality of working capital in Q1, leading to a negative cash flow of minus 395 million Danish kroner, excluding M&A. Now let's move to the P&L details on slide 6. As previously mentioned, the three divisions faced some challenging market conditions, resulting in an organic revenue growth of minus 3%, excluding the wind-down effect. Despite the mixed topline performance across our divisions, our gross margin remained strong, showing an improvement of 2 percentage points compared to Q1 of last year. This positive result was achieved even with the negative business mix and a slight impact from the tariffs. Our success can be attributed to our strong pricing discipline and the anticipated benefits from the 1GN integration. Reported EBITDA reached 300 million DKK, reflecting the top-line developments and some negative operating leverage. Now let's move to slide 7 to explore the cash flow performance. As a result of the revenue impact, our operational cash flow experienced a slight decrease compared to Q1 of last year. As anticipated, we faced a negative impact from the working capital due to traditional seasonality, leading to a negative cash flow of minus 395 million DKK, excluding M&A. Given the seasonality in cash flow and the lower absolute profitability in Q1 of 2025, our adjusted leverage concluded at 4.1 times. With that recap of our group performance, I'm pleased to hand you back to Peter for additional insights across the three divisions.