Addnode Group AB (publ)

Hello, everyone. It seems that we had some technical trouble in the beginning, so it might be that you didn't hear me in the beginning. So I just want to start over again and thank you for listening in and show the agenda. And let's start from there. So Adler Group's purpose is all about digitalization for a better society. We operate, acquire and develop entrepreneurial companies that provide digital solutions. For innovation and continuous development in close collaboration with our customers, we create digital solutions for specific needs. The software and digital solutions that we provide design buildings, infrastructure and cities, and also the products that we all use every day, like cars and all the way to our life science instruments. When things have been designed and built, they need to be maintained with a lifecycle perspective. And the public sector has a responsibility for the design and maintenance of our infrastructure. Our digital solutions makes all this possible. So looking at 2025, it was a year when we have set the foundation for further expansion. As I look back, I'm proud of the efforts our employees made and I truly feel confident about the future. We have landed new customers, strengthened our offerings, expanded into new geographic markets. Acquisitions have added net sales of approximately 700 million and we have strengthened the EBITDA margin. We have defined new financial targets, secure refinancing on more favorable terms, changed a new transaction model, adapted the reporting of third-party agreements. We also continue to invest in AI and product development, optimized our organization, and improved the EBITDA margin. So we increased the net sales with 4%. We had an EBITDA growth also of 5%, and the EBITDA margin increased of 15.6%. Looking at the five-year perspective in the graph to the right, you will see that from 2021 to 2025, net sales has increased from 3.5 billion to 5.8 billion, and EBITDA has increased from 461 million to 903 million. So, Q4. We saw significant improvement in margins and profit. Acquisitions and cost efficiency measures contributed to Adno Group delivering its highest EBITDA ever for a single quarter. Net sales increased by 5%, of which minus 4% was currently adjusted organic sales growth. EBITDA increased with 20% to 298 million, and EBITDA margin improved to 19.1%. You can also see that our EPS increased with 45% if you adjust for revaluation of the consideration for earnouts. If you look at our three divisions, process management, thanks to organic growth supported by margin-enhancing acquisitions, increased EBITDA by 34%. Product lifecycle management posted negative growth on sales, but EBITDA was in line with the previous year, thanks to cost savings. EBITDA in the design management division improved by 16%, despite challenging comparative figures for the fourth quarter in the last year. Margin-enhancing acquisitions in Canada and Brazil contributed to the improvement. Looking at the five-year perspective in the graph to the right for Q4, Q4 in 2021, we've increased net sales from 865 million to almost more than 1.5 billion in 2025. And EBITDA has doubled from 148 million to 298 million. With that as an introduction, I would like to hand over to Kristina, our CFO, who will give you further guidance on group net sales performance in Q4 2025.

Yes, thank you very much, Johan. I'm going to take you through the net sales development from the same quarter last year to Q4 2025. And as you can see, that net sales has increased by 5% compared to last year. And this growth was supported by continued execution across core markets and acquisitions, although partly offset by the currency movements. Looking at the organic side, the currency adjusted organic growth was minus 4%, reflecting tough comparison figures from last year, where we had a larger amount of three-year contracts within Autodesk. In the design division in particular, we saw now in Q4 this year a lower share of three-year agreements compared with the same period in 2024. And as we have previously communicated, the option to renew certain three-year agreements ended after Q2 this year. And these contracts are now being renewed on a one-year basis. And also in PLM system, sales and related services remained stable in UK, US and in the Nordic, supported by a broad and diversified customer base. Demand in Germany continued to be weak in the quarter, and the market shift from perpetual licenses towards subscription solutions further intensified during the quarter. Process division contributed with currency adjusted organic growth of 4% and sales to the public sector remained stable during the period. Looking at the contributions from acquisitions, acquisitions continued to perform according to the plan and contributed 236 million in the quarter. Integration is progressing well and acquired businesses delivered in line with our expectations. Currency, however, the currency movement had a significant impact during this quarter. And the strongest SEK, particularly against the US dollar, reduced net sales by 97 million SEK. And it's mainly within design division where the majority of the US dollar denominated business resides. Looking at the cash conversion then on the next page, our business model characterized by the asset light model with moderate working capital and R&D requirements. And we also have strong cash generated generation supported by the upfront payments that we can bill our customers. And this graph, as we have been shown before, illustrates Adnode's cash conversion over the past decade. And it's calculated as free cash flow in relation to EBITDA. And the pink trend line that you see shows the average cash conversion of around 70% up to 2023. And as highlighted in previous communication, we are currently experiencing a temporary working capital drag related to the changes in payment terms from Autodesk three-year contracts. And since 2023, these agreements are paid annually rather than upfront for the full three-year term. And this shift has reduced cash flow in the transition period. Now in Q4 2025, cash flow from operating activities improved to 324 million SEK from 275 last year. Although it's still affected by the payment terms adjustment. And the impact is gradually decreasing over the year. And reassuring, the graph now shows the first clear upward trend in the latest quarter confirming that the working capital headwind is beginning to ease. But as you can see also historically the cash conversion tends to fluctuate from quarter to quarter and we expect this pattern also to continue going forward. Now let's have a look at the financial position on next page. Over the past years, we have maintained a low debt level and leverage around 1.1 to 1.3. But during 2024, we have completed 10 acquisitions, which have resulted in a temporary increase in leverage. Ahead of the solid CAD acquisition in late October, we refinanced and also increased our credit facilities. which now total approximately to 3.7 billion SEK, secured by more favorable terms than before. And as of December 31, 2025, net debt, including leasing, amounted to 2.5 billion, supported by cash of 625 million SEK. Leverage has increased to 2.4 times, as a result of the acquisition activity. From the expanded facilities, we currently have 860 million SEK in available unutilized capacity. And as we have communicated previously, we intend to maintain a control net debt position going forward. And at the same time, we will also continue to pursue strategic value creating acquisitions which may temporarily increase the leverage depending on timing and scale. Moving over to look at the return on capital employed. Add note continues to demonstrate the characteristic of a compounder and we are delivering consistent and strengthening returns of capital employed over time. And you can see that the acquisitions completed in 2025 temporarily impacted reported return on capital employed. While the results from the acquired companies were included only from their respective acquisition state, and that's, for example, for SolidCAD by end of October, FF Solution came in beginning of August, and JNOS, the Norwegian company, in the beginning of July. The full amount of capital employed is added immediately to the base at the point of acquisitions. And the timing effect creates a dilution of return on capital employed, which now amounts to 14.1% by end of December 2025. And as the acquired businesses continue to contribute to earnings, return of capital will progressively improve, reinforcing our long-term track record of a disciplined capital allocation and profitable growth. And now let's have a closer look at the performance of our division. I'm going to hand over to Johan again.

Thank you, Kristina. So Anna Group, we are reporting in three different segments, three divisions, design management, product lifecycle management and process management. And if you look at the share of the net sales and the gross profit and EBITDA from the three divisions, you will see that design management is the biggest division with regards to both net sales and profit. And then you will see that process management are second in size and third is product lifecycle management. But I'm going to walk you through the three different divisions and the progress during the quarter. Starting with design management, that's where we help our customers with design software, product data management software, and the maintenance of buildings and infrastructure. So in the quarter, you can see that net sales increased by 6% to 701 million. If you adjust for currency effect, reported organic growth was minus 8%. But as Christina earlier told us, that most of the effect of their lower organic growth has to do with this quarter. We have a lower... portion of three years agreements being sold compared to last year in the Q4 when we had a higher portion. You can also see that we had almost 15% organic growth in Q4 last year on gross profit level and this it's minus 8%. So the lower organic growth is mainly related to the mix of one year and three year deals being made. But the weaker US dollar also had a negative impact this quarter as Christina previously described. But if you look at EBITDA, our profit increased by 15% to 169 million and the EBITDA margin increased to 24.1%. Acquisitions in Canada, Brazil and US have been successfully integrated and contributed to earnings according to plan. This is also the first quarter where we, like for like, can report with regards to the reporting of our three-year contracts. So going forward, we will not be posting pro forma figures as much as we've done because now we're reporting like for like with regards to our partner contracts. Symmetry, who is the world's largest Autodesk partner with a supporting offering of own tech and services, noted good demand from customers in infrastructure, construction, process and manufacturing industries. As I mentioned, we can see a negative impact on reported net sales from the three-year agreements. And as previously communicated, the possibility to renew certain of these deals was ended in 2025. That only meant that customers are now renewing them as one-year contracts instead. We're not losing any customers. I know that we have some discrepancies here with the reporting that says and the underlying organic growth. But our belief is that we do have an organic growth in the subscription base. ServiceWorks Global, who delivers digital solution for facility management at Tribia, who provide collaboration platforms of the construction infrastructure sector, had a stable earnings compared with the year earlier period. And if you look on a five-year period in the graph, you can see that we had a growth going from almost 1 billion SEK in net sales in 2021 to the 2.5 that we're trailing right now in 2025. And we've been able to improve EBITDA along that rise. It's been a good progressing trend over the years. So if we look at product lifecycle management, we're also providing design, simulation, and product data management software to different customers group, based on a very good partnership with Dassault System, complementing with own services and products. We can see that we had a net sales decrease by 9% in the fourth quarter. If we adjust for currency effect, the organic growth was minus 5%. And sales and related service shows stable trend in UK, US and Nordics, where we have a broad customer base spanning manufacturing, defense and life science industries. But in Constra, demand in Germany remained weak. But sales to strategically imported aviation and defense segment remains strong with several new customers added. You can also see that the trend with customers choosing subscription solutions or licenses with the perpetual right of use is continuing to strengthen. EBITDA decreased somewhat to 48 million, but EBITDA margin was on par at 10.8% as last year. mainly related to the measures implemented to adapt the organizational cost structure which were communicated in the first quarter has proceeded as planned and has been successful. These restructuring costs of almost 24 million were charged early in the first quarter in 25 and we now see the benefit and we are expected to generate at least annual cost savings of about 45 millions. In Q4, we acquired a company Extended Solutions in Sweden and has delivered according to expectation. And in January 2026, we also acquired a customer base in Germany. Look at the five-year perspective. You can see we've also been growing here, but unfortunately, you can see the decline in the profit, and we've been addressing that, and we believe that we are trending on a higher level than we performed in 2025. Process management. We are predominantly active in Sweden and Norway, providing local and central government software that makes it possible for them to do their job to both plan the infrastructure that we are all part of, but also case management and also high regulated industries like banks that we serve. Continued the fantastic growth there, and the division delivered yet another strong quarter with growth and improved EBITDA margin. Net sales increased by 24% to 425 million. Adjusted for currency effect, the organic growth was 4%. EBITDA was also strengthened by improved operational efficiency and positive contributions from acquired companies. Sales to the public sector remain stable. Large authorities are continuing to show certain restraint when it comes to investing in major projects. EBITDA increased even more by 34% to 94 million and EBITDA margin increased to 22%. The divisions business are well positioned in public sector owing to their attractive digital solutions, in-depth experience and strong references. So all in all, a strong quarter from the division. So moving on, if you look at acquisitions, we have announced 10 acquisitions in 2025. They are all expected to contribute to annual net sales of approximately 700 million and to strengthen the EBITDA margin. This has been supported through the EBITDA increase in Q4 2025. And as Kristina mentioned earlier on, when she talked about Netsys, that most of these acquisitions were made in Q4. So the majority of the several million will have a positive effect in 2026. But since the presentation of the last interim report, Q3 2025, we have announced two add-on acquisitions. The first one is ACAD+. It's a US-based provider of CAD-based space management and facilities optimization software. Its product, FMG+, is a powerful AutoCAD add-on that seamlessly integrates with other third-party platforms. This will strengthen existing software portfolio and symmetry. It will have a strong footprint in higher education, almost 150 public and private universities, and a growing public sector client base. There's a net sales today of 12 million and five employees, and it's consolidated as part of design division as of December 2025. EngCAD is another example of an add-on acquisition, but this is for Technia in the PLM division. It will strengthen their presence in Germany. It's an asset deal, some 80 customers agreement for the sole system software portfolio, and it will add approximately 18 million in net sales. customers primarily within aerospace and defense industrial equipment and transport and mobility and it's consolidated as part of product lifecycle management from january 2026. so what are we doing for our customers and If you look from an AI perspective, you can see that we're two cases presented in our interim reports. We also presented cases in our last interim report, and we will continue to present different cases as part of our interim report going forward. This quarter, we are showing two cases where we support public sector customers in both US and Europe. Symmetry has implemented an AI solution at the Port of Authority of New York and New Jersey to streamline infrastructure inspections of bridges, tunnels, and buildings. The Port of Authority needed a unified system to manage fragmented and inconsistent inspection data. Symmetry delivered an automation platform integrating GIS, geographical information solutions, AI, and natural language querying for intuitive data access. The solution improved data accuracy, eliminated silos, and accelerated real-time reporting. It achieved 100% data consistency and enabled faster data-driven infrastructure decisions. Another example is who has developed an AI-based solution for the city of Stockholm's city planning department to improve and streamline maintenance of the city's geodata system. Stockholm city needed a scalable solution to keep geodata accurate and up-to-date as manual inspections were too slow and costly. The Cerno developed Gaia, an AI tool that compares aerial imagery with maps to automatically detect and update changes. The system delivered reduced manual work by up to 75% while improving data accuracy and update frequency. Gaia provides a data-driven foundation for digital twins and sustainable urban development. So these are two good example how we can enhance our offering with AI and increase the efficiency in uses with our customers based on our knowledge of the business that they are working. So going forward, Arnold Group, we are a decentralized organization, but with the benefit of being part of a bigger group where we can share experience as we move forward. But if you look at a group perspective, we are focused on four things to build and expand AI capacity. And one thing is, of course, to deliver business value because everything is that what we do for our customers. So AI is an enabler for increased customer value, innovation, efficiency. The technology, which is being integrated into customer solution internal processes, is an important aspect of how we create value. So all the things that we do is that how can we use AI to drive the better customer solutions. But we can also help each other by coordinating leadership and how to move things forward. As I mentioned, we are a decentralized group, but we have very strong teams who are moving things forward and we can share the experience. Our executive summit, where we gather all executive management teams, is an example on how we can coordinate and share experiences. This year event was fully dedicated to the theme of AI, focusing on practical applications, business value, and the opportunities and challenges AI presents for operations. We also have an everyday task of being more effective and structured when implementing AI solutions. One thing that helps in that is our AI collaboration network. It's a group that brings together employees from across Adno Group to share experience, ideas, and best practices within AI. It connects people working on similar initiatives and strength and learnings within the organizations. Innovation is always very important for us. It's something that drives us forward. Adnode Innovation is the group's innovation program where all employees are given the opportunity to develop ideas and potentially start companies within Adnode Group. In 2026, the focus will be entirely on AI. Participants will have the opportunity to elevate their skills, gain practical experience and tap into insights from industry experts in everything from idea development to applied AI. This year, 56 different teams within Anno Group has submitted proposal to the jury as a lovable POC to the jury in January, and the winner will be announced in May. So it's a fantastic opportunity to get all the great ideas that are existing in an organization. But this is just some example of how we try to build and expand AI capacity across the group. So to end, where are we? in our strategy and moving towards our financial targets. We believe that we are delivering on our growth strategy, combining organic growth with the value creating acquisition strategy. Our financial target is to grow EBITDA with 15% year on year, meaning that we continue to double EBITDA every fifth year. Part of this is that we aim to move EBITDA margin to 17%. We are in queue for showing that we are delivering on our targets. If you look at the longer perspective, 2015 EBITDA was 160 million and 2025 we are reporting 903 million, meaning that the compounded annual growth rate for the corresponding period has been 18% and we have moved EBITDA margin from 9.6 to 15.6%. The acquisitions that we did in 2025 will add to the EBITDA growth in 2026 and expansion of EBITDA margins. While we're seeing good demand for our business and mission critical digital solutions, the global economy and geopolitical situation is still uncertain. But given our combination of diversified business, not only in terms of technologies, but also industries and geographic markets, our leading market positions and our dedicated employees, we believe that we have a good reason to feel confident about the future. With that, as a presentation introduction to Q4, we would like to open up for Q&A.