Kamux Oyj

Good morning everyone and welcome to Kamuks' Q1 results information session. My name is Katariina Hietaranta and I'm Head of Investor Relations at Kamuks. We have today our CEO Juha Kalliokoski and CFO Enel Simtonen presenting our Q1 results and after the presentation we shall hold a Q&A session. We shall first take the questions from the teleconference line followed by questions from the audience here as well as via the webcast chat. Thank you. Please go ahead, Juha.

Thank you, Katarina. Good morning. Let's get started. Let's take a quick look at our agenda today. As usual, we will begin with an overview of the quarter, then take a look at the market development, looking at each operating country separately. Then Enel will present our financial development in more detail. And as usual, we will finish with Q&A session. As it was last year, our focus during Q1 was on profitability. We succeeded quite well and cross-profit improved significantly. Despite negative volume development, Following this, the adjusted operating profit improved, but was still negative. Gas flow for the quarter was lower than last year. This is directly related to the very different starting position with our stock. We started the year by the low stock as planned, and towards the end of the quarter, we increased our inventory. Revenue from integrated services was 12.7 million euros, which is 6.2% of total revenue. Our customer satisfaction is at an excellent level and we further improved it during Q1. The group NPS for Q1 was 66 and Finland achieved an NPS score of 70 in March. And when we look about under the big picture, we see many positive things behind that. When you look about the gross margin percentage and gross profit per sold unit, Sweden started to increase sold units and revenue. Our equity ratio is 53. And as you see, we started to increase our inventory at the end of quarter. Consumer confidence was at a low level in all our operating countries. The Iran crisis and the following increase in fuel prices further affected consumers and their willingness to spend money on big purchases as such as cars. We also saw very rapid changes in demand for different powertrains and the demand for EVs spiked after the fuel price increased. The used car market contracted during Q1 in all our operating countries. Sweden was down by 5.5% and Germany by 1.7%. In Finland, the total market was down by 1.2%, but the number of cars sold by dealers grew by 1.1%. Disappointingly, as the number of cars sold in Finland decreased, we lost our number one position. In Sweden, despite the difficult market, our volumes grew and we gained some share. In Germany, where the market also contracted, our share remained small. In terms of new car registrations, the number of new cars registered across Europe grew by 4% during the first quarter. In Kamuks operating countries, registrations grew in Germany and in Finland, but declined in Sweden. To improve our efficiency in the capital region in Finland, we closed two showrooms during Q1. These were the showrooms in Malmi and Herptoniemi, as we announced earlier. The showroom in Seinäjoki, also Finland, relocated to better premises at the end of March. In Sweden and Germany, there were no changes to our showrooms and network during Q1 26. Now, a look at each country in turn. In Finland, the number of cars sold declined by 9.3%. As planned, the average price was lower than last year, and this impacted our revenue. We are satisfied with the cross-profit development, but we are not yet at the level where we want to be. Despite a 16% decrease in revenue, adjusted EBIT improved by 24.5%. Integrated services penetration levels were roughly at the previous year level. I'm particularly pleased with the high level of customer satisfaction in Finland. In Sweden, we sold 16% more cars than last year, first quarter. Cross-profit improved significantly but it's still too low. At this level, the number of sold cars was not enough to get Sweden profitable for the quarter. In all integrated services, the penetration rates developed into the right direction. Please note that the calculation method of insurance penetration has been changed. And now we count in only one-year agreements. Niklas Eriksson began with us at the end of March and as the managing director on April 13th. Niklas has a broad experience in the car industry. In Germany, we still have a lot to do, particularly with volumes. The average price decrease was planned, but this naturally affected our revenue. In Q1, first profit decreased compared to Q1, 25. But compared to Q4 of 25, gross margin developed into the right direction. Our focus at the moment is particularly on inventory turnover. And now I hand over to Enel to more details on the figures.

Thank you, Juha. And summarizing our financial performance in the quarter. Sold volumes and revenue declined, and B-drivers were underscored by Juha earlier. We can see that cross-profit in total, cross-profit per sold car, as well as cross-profit margin improved. And cross-margin improved for the fourth consecutive quarter. Inventory turnover, right size and right mix, continues to be at tight control throughout the quarter. And looking at financial performance per country, Finland and Sweden are moving to the right direction. And in Germany, we continue to face challenges noted also by Juha earlier. We work with discipline to turn it. Seasonal inventory build-up started towards the end of the quarter. We started the year with inventory level at 100 million euros and closed at 110 million euros. Operative cash flows, minus 7 million euros, was at most part related to inventory build-up. Our cash balance at the end of the quarter, 5.8 million euros, reflected that we have not utilized our short-term credit facilities, which are available in totals of 25 million euros. Balance sheet ratios improved and are at solid levels. Net debt declined to previous year. Equity ratio has increased to 53.5 percentage level. And basic earnings per share improved. And summary of our key financial ratios is presented here. As said, revenue declined, profitability and financial position measures improved. Earnings per share was slightly negative, however, improved well compared to previous year. And as a summary, at the time we continued to have headwinds in volumes, we focused on profitable deals, ensured right size and health of inventory, and solid financial position. Here we can see the trend in volumes. Volumes declined in a quarter, but less than in recent quarters. Our volumes few years back remind us of the capabilities we have and the ambition to go back to growth continues to drive us. Our integrated services revenue development was hit by lower volumes, And we are not satisfied with this trend, even though the share of integrated services has slightly increased to total revenue. We can see revenue and adjusted operating result trends here. And we are firmly focused on regaining volumes and improving profitability. And that said, seasonal build-up of inventory was the key driver of our operating cash flows in Q1. We are satisfied that we both started and also closed the quarter with right size inventory. Our outlook remains unchanged. Camus expects its adjusted operating profit to increase from the previous year. And in April, the AGM decided that a dividend of 5 euro cents per share will be distributed for the year 2025 and will be paid at the end of October.

Thank you. And Johan, back to you. Thank you, Enel. So, a few words about long-term targets and our strategy. In terms of our long-term targets, we are doing well with customer satisfaction. The group level NPS for Q1 was 66. And as I mentioned earlier, Finland NPS in March was as high as 70. Both are excellent. We have also made good progress in employee satisfaction and the ENPS risen to 19. This is obviously still below our target, but it's good to see the improvement in the important KPI. On the financial side, we have shown earlier today, we are not where we want to be. However, we are still standing by our long-term targets. Here is our current group management team. Niklas Eriksson joined Kamux at the end of March and started as the MD of Kamux Sweden on April 13th. Niklas has a broad experience in the car industry, and I'm very glad to have him in the team. At the end of April, we announced the appointment of Tuuli Kiiski as our new Chief People Officer. Tuuli comes from the Suvia Group and will join us at the beginning of the August. This is a reminder of our ongoing focus areas in improving productivity. We continued to work on managing our inventory and ensuring that we have a solid cash position. There is still a lot to do and we continue to work these on daily basis. Our strategy remains unchanged. The two main pillars being customer satisfaction and operational efficiency. As said, the group NPS has improved to 66 for Q1. We have also progressed in improving our operational efficiency, but there is still a lot to do. 2026 is the last year of this current strategy period. and we will review our strategy during the year. Our vision also remains unsensed to become the number one used car retailer in Europe. And now it's time for questions.

Yes, thank you Juha, thank you Enel. We have no questions from the teleconference line, so we'll open directly to the floor here. Tuomas, please go ahead.

Thank you for the good presentation, Thomas Westerholm from Indres. I would start off pointing my question to Juha. Considering how much the market and the competitive environment has changed over the past five years, do you feel like Kamux has changed or adjusted its playbook enough to accommodate it? If you look about the big picture in the European market, what is our goal, and then we look about the country by country. In Finland, five biggest player takes about 30% from the markets. And if I understood correctly from the US investor, it's the biggest part compared to the US. There is CarMax who takes 4% of the markets. And in Sweden and Germany, it's not so consolidated the market. And we see huge potential there And of course, there is coming to companies who lose the game totally. As we saw yesterday from Sweden, companies are closing and ending the business. Thank you. Now that more players are focusing on used car sales in Finland, what are the main ways to differentiate one from the rest of the pack? Maybe the One biggest reason is that the brand new dealers can't sell so much new cars, and they focus a lot of the used cars. And, of course, we have in Finland and Sweden a very big presence of stores that we have. And, of course, as we mentioned earlier, that we focus a little bit or change a little bit cheaper cars and take part of market share there. And it's coming about our games, our own ERP system, what we have based on only for Kamux and we own the IPR and we can handle about the customers and our employees and our inventory there. And I would say that it's one big part when we are going further and starting use with AI in our system. Got it. And lastly, a question about profitability. Q1 saw some development in the right direction, but we're still far from what you're targeting. What are the main things needed to happen either internally or externally for you to achieve this needed step change in the level of profitability? It's impossible to make changes in all of the different corners. And we choose about the profitability. I mean, gross margin, euros per gross profit per sold units. And it means that we lost some volume. And as we mentioned with Enel, that now we started to increase our inventory, and it tells that we are ready to go forward and start also the growing mode. Got it. Thank you.

Okay. Do we have further questions? Yes.

Jussi Koskinen, I have two questions. First of all, have you considered updating those CMB targets? I understand that the period is three years, but it would be nice to have some kind of market update. What has changed during these years? I understand that the update will be done. during this year or released maybe after this year, but how about having such a minor update? What has changed?

Yeah, we are coming at the end of this year. We didn't tell what is the time, but in the autumn and tell about when we are updating our strategies, what are the targets for 2027 to 2029.

Secondly, in AGM you mentioned that it's about efficiency game. Market defines sales prices and purchasing prices. So what are, and I believe you have already thought quite well this process, what happens between car purchase and car sales. So can you really find new ways to improve efficiency in Kamuk's own processes?

Yeah, I really believe that. There is many tens of small things where you can win or lose. It is not only one thing where you make the right decisions, but you must make tens of right decisions between the journey understand about the customer, what they are, what is the demand for it there, purchase the right cars and the whole track, how fast we can go with those processes and the rules and deliver the cars to the customers. And I believe that if you think about our average price, it's a little bit more than 14,000 euros and 1% is 140 euros and it's still quite a small money, but inside that 140 euros, there is many topics what you can make better.

Thank you. That was all.

Thank you. We have a couple of questions via the chat. Firstly, thank you for the presentation. As we saw, you had a huge rise in the Swedish sale. I was just wondering if you could tell us what the biggest reasons are behind in that increase. So volume increase in Sweden.

Yeah, the market declines 5.5% and our revenue increased double the number, 16% if I remember correct. It's just only coming back to the Kamuks concept. Following daily basis, what we are doing when we purchase and sell the cars and manage the inventory. It's just about that.

No magic. No magic. Basic, you know, working on daily basics.

Unfortunately, no magic.

Thank you. Second question. Would it be possible to take an exit from Sweden and Germany and focus 100% on the Finnish market?

Of course, it is possible. But then we must look about our vision to be number one in the Europe level. And the Finnish market is the smallest one. The German market is four times bigger compared to Finland, and the Swedish market is nearly double-sized compared to Finland, and we need also other countries to achieve our long-term targets.

Very good. Thank you, Juha. Thank you, Enel. We seem to have no further questions, so it's time to say thank you, everyone, and enjoy the spring day.

Thank you. Thank you. Have a great day.