Alligo AB (publ)

Welcome everybody to Aligo year end report 2025. And thank you for dialing in on a Friday the 13th. Sometimes I reflect on how time flies, especially when we have the quarterly reports, because it feels like we are having more than one every quarter. But this time I was just reminded that this is my 50th quarterly report. So that is really time to reflect on how time flies. Today's presenter, as always, is besides myself, CEO, it is also Irem Isenborn Belander, our CFO, but also now Deputy CEO. Congratulations, Irem.

Thank you.

And that's also the sign of the brilliant job you're doing, but it's also a little sign that we will stick to the path even after my departure. So that's a good signal. The agenda, as it always is, just some highlights. We're not going to go through the report in its entirety, just some highlights. We normally bring at least one theme, but today it's not only one theme, it's not two themes, it's actually three themes. One slide each on the renewed efforts in Tools Finland, own brands, that is 1832, and one slide on smart services. I hope you will enjoy that. And we normally fly in with a little A couple of slides on a legal group, a little shy of 10 billion second turnovers, Sweden dependent volume wise, even more on the profit wise, as you know. Two and a half thousand employees, some around 240 stores. We acquire companies, get stores, and we merge some stores, so then we reduce stores. But as it is today, some 240 stores. And we focus on brand, as you know, 18% of our sales as it is now. and we focus very much on small and medium-sized customers. This slide is a bit busy and it's not very easy to overlook but we are a little bit proud of it because it illustrates to the far right how we manage to run non-integrated businesses at the side of the integrated business. So we've built up a number of groups of businesses where we see growth potential within competence areas and product areas where we have in the integrated businesses. So it's not totally new businesses. It's areas that we do have in integrated business, but we'd like to focus on them a little bit more and keep the specialist competence that exists in those. And one is the product media grouping. They are now 17 companies overall, a little plus 600 million second turnover. And the welding businesses, six companies, with around 400 million in turnover. Then we have Battery with BatteryLaget, last year's acquisition, 280 million. And then we have others, and it's a bit of a pity to have that headline over a number of very nice companies. The fields are likely to be various, but HDP is one of them working with the defense sector in Finland, developing very nicely. But then to the left, you have the integrated businesses, as you know, Sweden, it's called Svedalen, Norway and Finland, it's called Tools. And that business is super integrated, logistically, IT, ERP, support functions. So that is really, really a true, true Nordic organization, integrated business. But 20% of the group today is the other separate businesses that are not integrated. So acquisitions, four acquisitions last year, a little less than the year before. But more stores, BatteryLogged had some 26, 27 stores, so that added a lot of stores. And the segments were to battery and product media. And we acquired some annual revenue of around 378 million and 115 employees, I think, BatteryLogged had some 90 people. So they are the biggest chunk of the acquired businesses. This is something nice. You saw that earlier, perhaps this week in a press release, we were awarded Ecovaries Platinum. So we are now number top 1% of 50,000 companies around the world. And especially in our industry, we are in a real, real top position. And it's very important to build a profitable and professional organization going forward for defense contract and for also the public sector and larger customers, it's very, very important that you take sustainability seriously. And this is a signal and a sign that we have been doing that in a very good way. So we are so incredibly proud to be awarded a platinum level for Ecovadis. That's very important for many aspects. Highlight Q4. Blue skies, but some clouds, I don't know what it should really signal. But it's a challenging market still. It has not changed dramatically. We've seen that, said that many times that we hear signals and we see signals and we see some early signals of improving market conditions, but it's not rising up to the sky yet. Recovery in Sweden. Norway ended the year with a little bit of surprisingly weaker oil and gas sector. We haven't really gotten their arms around it. Why? But in the Finnish market, the recovery continues. So the market sentiments are stable. The same behavior as before during the year. The customers are cautious, but we see good signs going forward. But we as management have been focusing on more or less the same things as we always are focusing. very much on driving sales. That is what is needed to be added to this case when we now build this platform. So driving sales, we continuously work with cost reductions, try to add acquisitions. I think we've done it quite responsibly, even in a slower market, we have dared to invest in growth and we have grown even in tough conditions, even if it hasn't been organic growth, it's been acquired growth. We are working with reducing inventory levels. We have much more to do, but as you know, we merged two reasonably different companies into one and trying to agree on one assortment to our customers. And we have more to do on the inventory levels. Price adjustment, the latest price adjustments went out beginning of February. I think we've got a pretty good process of doing that in a professional way. Good delivery capacity and microeconomic factors. It's still uncertainty, but for once, actually, we are a little bit benefiting from it. The trade tariffs made the capacity, freed up capacity in Far East, which is beneficial for us. We can get the minimum water quantities down. And also the strengthening of the SEC or the, yeah, that the dollars become cheaper is also actually good for us. So for once, there are some macroeconomic factors that are in our favor. So in brief, revenue growth 2.7% and that we normally do. The top line we grow, but for the first time in nine, 10 quarters, we actually kind of show organic growth. It's not gigantic, but we are so happy that we can at least say that we are back on organic growth track. Cashflow good, a hundred million up compared to last year. And adjusted EBITDA margin of 9.0. So we are reasonably happy with that. And the gross margin continues up. So starting from a very healthy level of 41.1, we now this quarter at 41.8. But as you know, this is not the margin maximizing case. I'd rather trade some tenth of the gross margin to get growth. we still believe that we do a decent job in knowing which contract which customers to to work with and keep the gross margins up but we need some top line to this and it will be brilliant this slide i showed of a internal meeting we have 600 sales persons in in all of the swedish sales organization and i wanted a picture that illustrated the sunrise but this picture was the one i got it's a dark total pitch black, but it's our business that shines up the sky. So sales high focus in all countries has been for a long time. It is still. And the achievements we have and the organic growth we have is the result of extremely hard work of our dedicated sales organization. We run these growth initiatives like it was a private equity case. Increased shareholder brands we're focusing a lot on. But we have a little bit to do on sales efficiency, we think, still. How to put together the customer portfolios and so forth, how to run that more professionally. We have some things to do that, we think. Acquisitions, we are happy that we could make the first acquisition in product media in Norway with Respond. We've got a good footprint in Norway now, 81 million second turnover. So now we can acquire businesses to that platform. So that journey will continue in Norway. And operations wise, except for a lot of good financial development in the quarter, we also did a refinancing. So three plus one plus one is in place, increased headroom. So it gives us good financial stability and also headroom to do acquisitions and so forth. Margin improvement, as I said, Continuous development of sales and assortment processes. And tools in Finland we'll come back to. And always super cost conscious in whatever we do. So the three themes I promised you. If we take the first one. Tools Finland. We started that during 2025. And it's the same activities as we identified them. It's no new activities. It's the same activities. But we really, really need to ensure that they are being carried out. So to be clear, it's the same evaluation of which shops are profitable or not, which customers are profitable or not, and how do we run the business. So we have a new country manager in place, a person I've known for 17 years. I brought him with me from my previous job to Sweden, and his name is Håkan, and he will succeed. I have no doubt about that. He knows how to run a safe organization. So Finland, it's a tricky market. There are very few companies who are really profitable. We are in a decent place already as it is, but we are not happy with our profitability level and the structure of the business. So we will drive even harder towards smaller medium sized customers getting the private label share up and look over our structure. So that project is already well So Finland, we will continue to report on the progress, but we are doing what we said the whole time. So two more areas, starting from the far right and ending at the far left. So if we take own brands, just a quick on 1832. It's now being launched, it's being sold, and it has its part in our product portfolio. But a number of other things that we perhaps could have predicted and perhaps not is that if you have a customer complaining, saying the price level has come up on the Gesto, and now when we can offer 1832, the customer many times choose to stick with Gesto because they had the option to take 1832. So 1832 plays different roles in our product portfolio. It is a lower price, high quality product. But it's also an offer for the customers that, at the end, choose to actually stick with the guests of Janklöden Univan, which are our higher position brands. So 1832, we are very happy that we launched that so quickly. It plays an important role today, and it will play an even more important role going forward. And then smart service, you've heard about that before. And we think we have the best solution in the business. And we are reasonably successful in implementing that. We have 1,300 of these solutions out in different customers in the Nordics. Some of them are Sandvik, Hitachi, Widerö. Hitachi I will visit in a couple of weeks. We have others. I don't know if we're allowed to talk about them. One is producing the world's fastest car. I'm going to visit them in a couple of weeks. where we are well integrated into the production facility with our smart service. So we have identified, invested in, and are now launching areas where we take away the product price out of the equation. So we build ourselves much tighter to the customer. So these are really, really clever solution, which brings great benefits for the customers. Financially, our deputy CEO,