AcadeMedia AB (publ)

Welcome to a CAID Media Q1 2026 conference call. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to the speakers. CEO Marcus Strömberg and CFO Petter Sylvan. Please go ahead.

So thank you very much and welcome to this presentation of the first quarter of Academedia from me and Petter and of course the school year is always a fantastic time for us when we start with new students and we have also traveled around and opened up a lot of new schools in Sweden and made a lot of acquisitions that we will tell you more about. But the first quarter is, as we always say, a small quarter, but it's important that you could see that the growth continues in a stable way with around 14% growth in the quarter and the profit increase with 18%. So the start of the school year is very stable and good and continue that development that we had had before. The driver this quarter is the preschool and the international development, but also the compulsory schools and the adult education. If you look at the adult education, it's very interesting to see the increased demand in vocational training and the driver of change of the labor market that has also improved the volumes when it comes to adult education. And we have also seen the PISA results in Sweden, and it's very important to make early efforts when it comes to literacy and also when it comes to maths. And if we look at the numbers, we will comment on that a little bit longer in the presentation, but we have very good results when it comes to reading. We have continued with acquisition, both in Netherlands, that is an important market for us, both with preschools and also continued to develop in new schools. and we have also completed acquisition in Poland that we could continue and tell you a little bit more about further on in the presentation. And if you look at the next slide to look at this number and if you look at the PISA results all over Europe you could see that one of the key question is that you should start With reading, the PISA questions is about reading in a good way. And we have really made a lot of efforts to improve the literacy outcomes in the early child grades. So in grade one, we now are at 93%. We always aim for 100%, but today it's 93%. So if you look at the quality results, we have better quality results, lower cost for the society, We have better, if you compare with the national test, we have a good grading and also the exam results when they come from the students is also very good. So the quality is stable in Academedia. And then if we look at acquisition, we have made a lot of acquisition over the year, more focus on the international development and as you all know, we are target at www.patreon.com and UK will be very interesting market for us. And also we will continue to grow in Germany and also in Netherlands. But this gives a good view of Academedia's development. And if you look at Academedia over here, we think it's important to look at this slide. You could meet a lot of companies that talk about the future, but we have also presented a very good historical development over here with 18 Present Karg EBITDA development over time and we think that is also promising when you look into the future and you can also see at the next slide how we perform when you look at our target that 50% should be outside the Swedish school voucher system and that is development that we should think should continue and we have now opened up two great good platforms in Poland and UK.

Okay, thank you Marcus, I take over here and this is Petter, good morning everyone. I will start to talk about an update of the regulatory landscape which remains an important topic here for the sector of course. And the final part of the school voucher inquiry covering upper secondary school was presented last week. The proposed 6% deduction that was presented for a compulsory school remains, while upper secondary school would not be subject to a deduction of similar type. Both of these proposals, which are bullet number three there and striking over in the slide, these are proposals that remain subject to political and legislative processes. And both timing, potential financial impact remains uncertain as the first proposal was not taken forward by the former government. So as of today, we don't have any real indication that this will be legislation. The current focus for us are mainly now on the profit regulation, which we have talked about for a number of quarters, which will be enforced from July 2027. And the principle of publicity, which will be enforced from the beginning of January 27. And most of the proposed restrictions from the former government are manageable for Academedia. Both these two processes will increase administration to some extent, but the impact is considered manageable. And as we have concluded, this may also accelerate consolidation and benefit larger operators with established systems. So please continue to the next slide. Now we start to talk about the financial update and as Marcus has mentioned we have a solid start to the year with student numbers increasing by 7.4% and this was slightly lower than initially expected due to the delayed consolidation of one of the acquisitions that hits ENCO in Poland. Net sales increased by 14.1% to 4.7 billion and this is including organic growth of 4.8%. Adjusted EBITDA increased by 18.1% to 250 million and the margin improved to 4.6%. Preschool and international was the main earning driver. Free cash flow also improved significantly, reaching 195 million compared to last year's negative 111 million. Next slide, please. And the bridge here shows adjusted every day. Increase from last year's 182 to 215, as I mentioned, and preschool and international provide the largest positive contributed. Compulsory school was improved and also supported by one major acquisition, the Prolympia. Upper secondary school was weaker due to relocation costs and quality initiatives. And with adult education, it was the high vocational education and labor market services which has had a positive impact on operations. Next slide, please. On a rolling 12-month basis, net sales increased by 8.6% to 20.9 billion, while adjusted EBITDA increased by 16.4% to 1.5 billion. The margin reached 7.4% and remains within the 7-8% target range. Free cash flow increased to 1.6 billion. Please continue. And now we move over to the segment reporting, and I will start to talk about the preschool and international. Net sales increased by 73.9% to 2.0 million, driven by acquisitions, international expansion, and M&A. Adjusted EBITDA improved to 32 million from last year's zero. The improvement was supported by acquisitions, temporary lower personal costs due to vacation timing and improved efficiency in Swedish preschools. Two acquisitions added 43 units during the quarter. Kids & Co. in Poland was completed after the period and therefore not included in the quarterly result. Moving on to compulsory school segment. Net sales increased by 17.8% to 1.1 billion, while adjusted EBITDA increased by 28.6% to 63 million. The preliminary acquisition supported volumes, sales and earnings. Part of the earnings improvement reflects timing effects from vacation uptake and deferred material purchases and should not be extrapolated. Continued upper secondary school segment. Student numbers were broadly unchanged, slight uptick of 0.2%, while net sales increased by 1.6%. Adjusted EBITDA decreased to 50 million Swedish krona from 75 million and the margin declined to 4.1%. The decline was related to relocation costs, new campus openings and quality initiatives introduced during the previous academic year. Continue to adult education. Net sales increased by 5.0% to 442 million and adjusted EBITDA increased by 7.6% to 85 million. The margin improved to 19.2% and rolling 12 months adjusted EBITDA has now improved for 13 consecutive quarters. The improvement was driven by higher vocational education and labor market services. And it's also worth noting that Q1 is normally the seasonal peak for this segment. We now move on to the financial position and we talk about cash flow investments and the financial position overall. Let's start with free cash flow and investment. On the road in 12 months free cash flow, It's amounted to 1.6 billion, with the year-on-year movement mainly explained by working capital change. Maintenance capex was 1.6% of net sales, and the increase was linked to new openings and expansion units. Strong free cash flows can fund current operations and a substantial part of continued growth, while larger acquisitions may require external financing. Move on to financial position and net debt, excluding IFRS 16, increased to 2.1 billion, mainly due to acquisitions. And although we have had a significant increase of M&As, leverage increased to only 1.0 times adjusted EBITDA, which means that we are well below the maximum target of three times. Continue to next growth and profitability related to the financial targets. And as we can see, with 5.4% and the adjusted EBIT margin of 7.4%, we are well within both these two profitability measures. As mentioned, the leverage excluding IFRS 16 1.0 is well below 3. and we have just recently now proposed a dividend of 2.8 krona per share to the general meeting. So the group is currently delivering within all quantified financial targets and this concludes the presentation and we now open up the floor for questions.