Alcadon Group AB (publ)

So, hello and welcome to Alcadon Group's Q3 presentation. My name is Pierre Fors. And my name is Niklas Svensson. And Niklas is our CFO. As you know, I am here as TF, CEO and head of the company. It is a new role for me, you could say. I have been in the company since early 90s, first as a customer and then I started working in the company in the 90s. I was the CEO and CEO for about 20 years and was involved in and employed Sonny Myrvorn as CEO and CEO 2019. Since then I have been the board chairman. I am now entering the TF role in quarter four. I want to thank Sonny for these five years. We have grown geographically. The company is now taking a new chapter. Fredrik Valentin from Bergman & Beving joined the company on January 1, 2025. So, let's see here. A little short about us. Alcadon continues to work with outdoor connectivity and indoor connectivity. And we actually have three business areas, three customer segments. Where the largest, which is about 40-50%, is cabling and other. That is commercial properties. It can be offices, hospitals, airports and so on. There is always a great need to adapt your organization to larger or smaller. So that it happens differently. things here all the time, so it is a constant movement for us, this part, so we think it is very interesting. We also have a housing network. I think most people know today that the housing market has been a bit like it has been, but it is not in any way our largest part, but we are quite convinced that it will continue to be built in the future. We also have a smaller part, which is service, consulting and tools, tools and instruments, which is part of our business, which comes in quite a lot here, which also plays a role in all of our business segments. Then of course we work with broadband or fiber. And this segment with fiber is used in all of our segments. And we see a great need here. And we're talking about both outdoor and indoor, regardless of whether it's a grid or fiber between buildings, cities, countries, through tunnels and so on and so forth. Not least the 5G infrastructure that is still ongoing or just this FTTH or FIBER in general. We also work with data centers that are Egentligen för oss ett nytt segment, kanske inte nytt för oss att jobba med datahallar och så vidare, men det har vuxit enormt det här området och vi ser hela tiden i takt med att mängden data ökar, så ökar ju då också även lagringskapaciteten. AI är en stor drivkraft, varje fall kanske den senaste drivkraften i det, men även säkerhet och lite tuffare miljöer är viktigt att man klarar av här. So that's what we're working with. And just fiber or broadband and fiber and data center stands for about 25-30% each. And cabling and others, as I mentioned, our different cable system parts stands for 40-50%. If we look further, the technology also works like that. When we work with Våra industriella största potentiella växande områden är ju fortfarande, om vi pratar just om fiber, så är det efter till H, alltså fiber till hemmet. Och då har vi även, även om vi exkluderar 5G-utbyggnaden, även om Norden har byggt and done quite a lot and have been in the forefront so far, we see that this last mile and after-end now is starting to take off. New areas are being built and that is of course also driven by a lot of economy. And one of the reasons for the acquisition The rest of the countries on the table here is precisely because we see that fiber penetration has enormous potential for us. Actually in all of these, Belgium, Germany, UK, Ireland and the Netherlands where we are. Germany, if we take them separately, it has been tough. I think the whole Our entire industry and our industry colleagues have felt that it was tough in Germany, but still a fantastic potential there, especially since the German government has gone out with increasing the willingness to invest from 12 to 38 billion until 2028. We also see the data center part, there is also a very big potential for us. Everyone wants to participate, especially in these hyperscale businesses, the very, very largest, the big five. There we are often with, or not often, I can say, there we are happy to deliver as much as we can. But our main focus is on small and medium-sized data centers. And here we also see a lot of help from especially so far in the UK and Ireland, who have contributed a lot with internal help for us as well, and of course also in their own regions. Yes, we look further here at the next slide. Good. So this is how we look today. We are represented in these red dots. We see that since 2019 we have grown quite strongly. Sweden, the Nordic countries are no longer the largest, but we have about 39% in the UK. And we have grown through Denmark, further into Germany and Benelux, and now last with Woods, Ireland. We have a net sales of about 1.6 billion. We have an EBIT rolling 12 of 109 million. We work with about 200 different suppliers, of which several I don't dare to say all of them, but several of the world's leading manufacturers that we cooperate with, both explicitly in some countries, but also where we help each other between countries. We also have our own developed products that we have had in the company for a long time, and that can also apply to countries that we have acquired the company that they have also had a similar profile in that way. So we have a good mix. We have a good collaboration that is improving between countries. So yes, we think that's good. We also work with a large number of customers, about 4,000 customers with a fairly high customer satisfaction. which is the NPS score, which goes from minus 100 to plus 100, and we are at 57. And of course, we are proud of that and it is an important factor for us also when we look at acquisitions that we do, how it has looked historically. This means that we get a little less customer dependence from individual customers. We have a good mix important for us. Vi har ungefär 190 anställda och tillsammans äger vi 15 % av bolaget. Det är vi såklart stolta över, att ha en sådan del av lojala och intresserade anställda. Precis som vi har väldigt många bra övriga investerare såklart. Yes, Q3. Yes, it's kind of a quarter for us. We have a lot of differences between countries. Niklas, would you like to clarify a bit here?

Yes, absolutely. Thank you very much. As you said, we have a growth compared to last year, which is driven by Sweden, but also by the acquisition in Ireland, which we did in the second quarter. At the same time, we are weighed by our smaller regions, which have gone tougher during the quarter. We increase sales by 2.3%, but organically we decrease by 7%. And the decrease is mainly due to Germany, Benelux and then primarily Holland, and also Denmark and Norway. Denmark and Norway, they have had a tougher market for a longer period now, several quarters, and it was still tough in Q3. We could see a little lightening in Denmark, which is growing compared to quarter one and quarter two, but compared to last year, they are still down. When it comes to Benelux, we are decreasing this quarter, and that is due to the Netherlands. We have also decreased in Germany. In common with both Germany and Benelux is that we have had extremely strong growth in the last quarter or the last year. But there we have had a comeback in this quarter. which then keeps our growth down. If you look at EBITDA, then we decrease EBITDA by 36%. But if you look at exclusive revaluations of earnouts, unrealized currency effects, then we decrease EBITDA by 10% compared to the same quarter last year. And that means that the margin has decreased to 4.6%. The EBITDA margin last year was 7.3%. If you look at exclusive currency effects, it is 5.2% against 6% last year. Earnings per share, which is an important key number, is decreasing dramatically from 63 EUR per share to 22 EUR per share. Even there, if you look at earnings per share, exclusive revaluations of earn-out and unrealized currency effects, it decreased from 39 to 32 EUR per share. An important key for us, which we focus on a lot internally, is operating cash flow per share. There we had a very strong quarter last year, which mainly consisted of the liberation of mobile capital, and that was that we reduced our deposits. We have continued to reduce our deposits since Q3 last year, but not at the pace we had during the individual quarter last year. The cash flow is an important focus for us. A key figure we look at internally, which also shows the cash flow generation over time and the trend over time, is EBITDA over Networking Capital. We can see that we increased from 33% last year to 41%. Our net debt has increased during the quarter and is 2.7 to 2.9 times our turnover, depending on whether you count inclusive leasing or exclusive leasing, which is within our goal, which is 2 to 3 times. The increase we have seen during this quarter is equivalent to an increase in net debt, and the net debt has increased because we have paid out earn out from network centers. 67 million. And Network Center has grown very much since we acquired it, and they are up 32 percent, rolling 12, compared to the time we acquired it, which is an incredibly good development, and where even the margins have strengthened strongly.

Good, thank you Niklas. What we have highlighted here is that we see the data center segment continue to grow in most of our markets. And the same thing with our cable cabling, that we see that we are stable there. And the broadband segment, we see that What we know and the signals we get without giving too clear forecasts is that growth should come in the long run and we are on the lookout for the market. Niklas, should we say something about Ireland?