Attendo AB (publ)

Thank you and good morning everyone. Today we present Attendo's results for the second quarter. I will start by giving a general update on the development in the quarter, then our CFO Mikael Malmgren will take you through the financials in more detail. First let me just give a brief backdrop to Attendo for new listeners. Founded 40 years ago, Attendo is one of the early pioneers in Nordic care. Today, we're the largest care operator in the Nordics, operating close to 800 care units, serving 28,000 customers across Finland, Sweden, and Denmark. Our mission is to provide a better and more appreciated care for our customers at the lower cost of society compared to public sectors on care operations. Next slide, please. In the second quarter, we continue to deliver in line with our strategy for sustainable growth with new openings in all markets combined with Bolton acquisitions in attractive segments. During the quarter, we open new care homes in both Finland, Sweden and Denmark, taking rolling 12 month new openings up to more than 400 new beds. With the announcement of our acquisition of the disabled care company Främja in Sweden earlier in the quarter, we're now already above our annual EBITDA growth plan of adding at least 2% EBITDA through new capacity and another 2% through acquisitions. Topline sales were down slightly compared to last year, mainly due to weaker euro, ended outsourcing and home care contracts in Scandinavia, and slightly lower pricing in elderly care in Finland, following the lower staffing requirements since the start of the year. From the underlying business, we still see healthy growth of around 4% compared to last year. Our release adjusted EBITDA continued to improve in the quarter up by 26%, or 42 million to 205 million SEK. Earnings were driven primarily by operational improvements in Finland and more sold beds in all nursing homes in both business areas, while underlying result in Scandinavia was in line with last year. In Finland, we continue to see positive effects of the swift adaption to the new staffing requirements imposed by the turn of the year. We also see effects of further operational improvements and more sold beds. In Scandinavia, the underlying result is in line with last year. The reported result in the quarter is hampered by non-recurring costs related to ended contracts and home care, as well as anticipated start-up costs for new units. Having said this, we're not entirely happy with the current performance in Scandinavia and have implemented several actions to improve performance and stability going forward. Lease adjusted EPS was up to 25% to 0.85 sec per share in the quarter, bringing the rolling 12-month EPS up to 4.81 sec, up 48% from Q2 last year. Hence, we're well on track towards our adjusted EPS goal of minimum 550 sec per share in 2026. In Q2, we saw further improvements in customer satisfaction, with CMPS rising to an all-time high of 49 from 45 in Q2 last year. This result is attributable to all the efforts we make to improve everyday life for our residents and customers in our care units. It's also a testament that our individual center care model at Underway continues to deliver great operational results. Further, it shows that our focus on strong unit leadership and smarter tools for our care staff has positive effects on both operations and satisfaction among our care residents. Employee engagement remains at high levels, with overall EMPS slightly down compared to a year ago. This relates to Finland, where the recent restructuring of staff following the new staff requirements have led to a slight drop in EMPS. Next slide, please. So let's turn to occupancy development. Overall, we've seen continued inflow into our units with more sold beds in both business areas. Reported occupancy, however, is slightly down compared to Q1 as a result of new openings during the quarter. In the quarter, we opened new nursing homes in Denmark and Finland, as well as a new disabled care unit in Sweden. In total, close to 100 new beds. On top of this, we reopened close to 100 beds in Finland that has temporarily been closed for renovation. Combined with newly acquired units and openings in the first quarter, we've added approximately 500 new beds so far in 2025. Occupancy in the quarter was also slightly negatively impacted by seasonality as some customers leave the care homes for summer holidays with their families to return after the summer. Excluding newly opened and reopened units, occupancy continued to improve in the quarter. This graph shows a rolling 12-month sales growth and at least adjusted the beta margin. Margins continue to improve in the quarter, primarily driven by improved operational efficiency in Finland. In terms of net sales, we saw a slight drop in the quarter due to a weaker euro and ended contracts. All in all, margins should continue to improve gradually in the second half of the year. Let's take a closer look at the financials for the quarter and please go ahead, Mikael.

Thank you, Martin, and good morning, everyone. So let's turn to page seven. In the quarter, we saw underlying growth in both business areas of 4%, offset by ended contracts, exits and FX headwind, which resulted in reported net sales decreasing 3% to 4.7 billion SEK versus last year. Adjusting for currency, the overall growth was fairly flat, meaning currency had a 3% impact on total sales. In Atendo Scandinavia, the underlying growth was 3% and down 5% reported. We see continued growth in own nursing homes. However, growth was more than offset by ending outsourcing and home care contracts. In Atendo Finland, the underlying growth was excluding divested units plus 4.4% and 3% in local currency with an increase in new customers and all key segments showing positive growth. Currency had, as expected, a larger 3% negative sales effect in the quarter. And based on current trading, we should expect similar to slightly lower effect in the coming quarter. Slide eight, please. The reported result improved to 349 million, one of our strongest Q2 results ever. Correspondingly, the least adjusted EBITDA increased from 163 to 205, up 26% versus same period last year. Lease adjusted EBITDA in Scandinavia was slightly lower than last year, negatively impacted by exit costs in home care, some startup costs in new homes and Easter seasonality. Finland lease adjusted EBITDA improved 52 million year-over-year. Currency had a 13 million reported and 9 million negative effect on lease adjusted EBITDA. Next slide, please. Growth for Arcanda Finland amounts to minus 2% reported, plus 3% in local currency, and adjusting for the exited rehab business December last year, the underlying growth was 4.4%. Liz's adjusted EBITDA was 183 million, an improvement of 52 million compared to last year. The quarter improved by better staffing and more sold beds. Occupancy rate also improved versus last year, with more sold beds and from exiting a few low no occupancy units during the year. In the quarter, we also opened a new home and added new capacity within existing units. Next slide, please. In Scandinavia, underlying net sales growth was 3%, driven by growth in own nursing homes. However, growth was more than offset by ended outsourcing and exiting home care contracts, resulting in total growth down 5% year over year. This adjusted a bit that was 44 million. We delivered, despite some startup costs, continued improved results in our nursing homes. Our new home in Stockholm, which opened in March, is developing well. And in June, we opened an additional new nursing home, which is off to a good start. Ended outsourcing contracts had no material impact on results. However, as mentioned in Q1, we terminated a few selective home care contracts where sustainable conditions mainly no longer exist. In Q2, these contracts had a 20 million non-recurring negative impact on the result, slightly higher than estimated effect communicated in Q1. Going forward, we expect less, but still some negative impact in Q3 and subsequently lower impact in Q4. While we delivered a result in line with last year, when adjusting for one-off effects in both this and last year's quarter, the result is not satisfactory. Scandinavia has more to give and ongoing actions expected to improve performance. Finally, in line with our strategy, we signed an agreement to acquire Fremja, which will further strengthen our unique disabled care offering. Acquisition has a revenue of approximately 150 million and above average margins and is expected to close end of Q3. slide 11 please our free cash flow was strong and improved to 869 million on rolling 12-month basis where q2 free cash flow was 316 million versus 199 million last year capex was at similar levels versus last year and during the quarter we paid out our dividend of 1.20 sec per share which impacted the cash flow by 179 million In the beginning of the quarter, we also made 36 million worth of share repurchases. And today we launched a new repurchase program aiming to repurchase 150 million worth of shares until next quarterly report in October. Next slide, please. Over the last 12 months, we continue to deliver on our 24 to 26 financial plan and a more active capital allocation. As a result, we have utilized approximately 70% of our free cash flow for dividend and continued share buybacks. In addition, we have continued to add high quality value-accredited bolt-ons, firstly in Finland Q1 this year, and we aim to continue with this, adding further value-accredited bolt-ons during the rest of the year. Also worth mentioning is that during the quarter, we agreed with our banks to increase our revolving credit facility for 1.4 billion to 2 billion SEK. This will enable us with increased financial flexibility and ensure we have enough acting space to deliver on strategic initiatives and overall also our active capital allocation strategy. Next slide, please. So let's have a look at our key financial metrics, which continue to move in the right direction. If we start at the top left, the adjusted earnings per share improved by 0.17 sec per share, up 25% versus last year. Improvement primarily due to higher lease adjusted EBITDA and further supported by our continuous share buybacks. If we turn to the top right figure and our lease adjusted margin in percent, Adjusted for non-recurring items last year, we continue to improve our loose adjusted EBITDA margin. In Q2, the rolling 12-month margin was 5.8%, up 1.2 percentage points compared to Q2 last year. And if we look at the figure at the bottom left, our loose adjusted net debt to EBITDA ratio was 1.7, in the lower part of our target range of 1.5 to 2.5, and down 0.5 times versus same quarter last year. And finally, if we look at the figure on the bottom right, net interest expenses in the quarter was 31 million, in line with last quarter, where we see the effects of improved market interest rates. With that, I hand over to you, Martin.

Thank you, Mikael. Next slide, please. Before we move on to the Q&A, let me just briefly summarize. We continue to deliver on our strategy for sustainable growth that we set in 2024 with stable financials, strong operational development and high satisfaction scores. In the first half of this year, we have continued to show a strong development in our underlying business in both business areas. We're selling more beds, adding capacity and filling up new units according to plan or slightly faster. In Finland, we continue to deliver operational improvements in a changing environment with solid earnings growth, With the combination of new openings and Bolton acquisitions, we also have improved our footprint for further growth. In Scandinavia, we see a continued positive development in the nursing home segment, while earnings in the quarter are negatively impacted by one-off costs for new openings and ended home care contracts. The ended outsourcing contracts have no material impacts on earnings, well in line with our strategy to exit contracts with unsustainable terms. As announced in June, we're adding Främja to our existing Unica brand offering in disabled care in Scandinavia, expecting closing during September. Supported by strong cash flow in our business, we'll now resume with share buybacks. All in all, we're well on track towards our adjusted EPS target of at least 550 in 2026. That concludes our presentation, and let's turn to the Q&A session. Operator, please go ahead.