Careium AB (Publ)

presentation by Carium and we are to be presented the results for the second quarter of 2025. Presenters are CEO Christian Wallén and CFO David Granat. A Q&A session will follow with equity analysts and viewers can ask their questions in the live chat. By that, let me welcome Christian and David. Nice to see you. Thank you, Mattias. Thank you. Please go ahead with your presentation and I'll be back for the Q&A.

All right. So we will then jump right into it. Let's see. Yeah, there we go. So first off, a warm welcome to the carrying report for the second quarter of 2025. I'm Christian Wallén. Together with me, David Granat, our CFO. So let's open up with the highlights of the second quarter. And I think it's really important to state that we see this as a very challenging quarter and while there are some silver linings to it, it is also a quarter where we feel as if going forward we will have to perform in a different way. And first off then, I mean, we did break through on the fixed alarms or the stationary alarms, the hubs, which are our sort of main category in France. We have never had any sales of this type. Most of our business has been on the mobile solutions. where we are very well regarded and leading the market. But breaking into these stationary alarms is really key because France is set for a string of pearls of decommissioning of 2G, 3G and then PSDN come 2030 in the upcoming years. So becoming an entity there and getting substantial orders is, of course, very, very crucial for us. In addition, we also reported that we won a fully managed contract in the UK. Now, to many of you out there, this might not make so much sense, but to us it's super important because it's the best contract type you can find in the UK because it sees you delivering across the full range of services and hardware and everything integrated. in a way that allows us to drive a really good business. These fully managed contracts, they are probably around 5% of the total contract base in the UK, also serves as really important reference points for further fully managed contracts. And last but not least, we also overhauled our entire digital and web infrastructure in the period This is very much related to our efforts in B2C, where we were stuck in legacy solutions that were not conducive to actually driving good digital consumer-centric business. And with the highlights out of the way, let's head to sales and gross margin for Q2 2022. And overall in Q2 2025, as we stated, very challenging, we saw a decline in reported sales with 11.9%. Now to understand this decline, it is related to various sources. First off, it's the accounting of the financial lease classifications in the Swedish business that amounted to 15.1 million in comparable terms. The lower product sales accounted for 11.9 million and this was mainly due to the performance of our German and Norwegian business in the same period of last year which was extremely strong. Last but not least, we also saw a negative effect, 5.9 million of currency effect. In further detail, services decreased 9.4% to SEK 147.9 million and product sales decreased 18% to SEK 54.2. And as mentioned, this is very much in contrast to Norwegian and German performance same period last year. We do note that the gross margin stayed reasonably steady and even increased to 43.3% up from 41.7% reflective of efficiency efforts in spite of the lower sales. And with that, we head to our markets. Now, first off in the Nordics, we saw sales decrease 15.8% compared to Q2 2024. While our business in Norway reported continued growth, Sweden's reported sales were impacted by the lower revenue of this upfront effect from the financial leasing contracts. It's worthwhile to notice that if you exclude the financial leasing effect, the region actually grew with 1.4% in the quarter. In this Q2, we recognize 1.2 million as hardware deliveries in Sweden classified as financial lease. and booked as sales in the quarter compared to 16.3 million in the second quarter of 2024. So this implies a direct negative impact of 15.1 million on net sales in Sweden in the quarter. For the rest of the year the negative impact of this accounting principle it will remain significant as the financial lease classifications for the upcoming comparable quarters were 24.2 million in Q3 of 2024 and 15.2 million in Q4 of 2024. However, the impact will be lower from the first half of 2026 as the recognized financial lease for 2025 are 3.2 million in Q1 and as stated now 1.2 in the second quarter. As more and more contracts are recognized as operational leases in contrast to taking the upfront revenue as a financial lease, this also means that the share of recurring revenue will increase. We note that the gross margin increased to 40.7% compared to 38.3% in Q2 of 2024. And then turning to the UK, which as a single country is our biggest market. Sales decreased 9.3% to SEK 71.9 million in the quarter. Product sales decreased 8.9% to 31.4 million. It was 34.4 same period last year. But the effect here was that it was very low at the start of the quarter. and picked up and gained considerable momentum towards the end. So from our perspective, it's really important for us to retain this momentum. As mentioned, we had a really important win in this Gloucestershire fully managed contract. We hope to be able to have this as something that allows us to convert more of this going forward. And these partnerships then they include provision of technology, installations, services and so on. So they are really really important to us. Turning to the Netherlands, we saw sales grow 4% compared to Q2 in 2024. The product sales declined but from very very low levels and the gross margin come in at an impressive 61% up from 55.1% same period last year. In the other markets, as you know, primarily Dutch, Germany and France, to a little extent Spain, but not to a meaningful degree, sales decreased 16.6% to CEC 21.5 million and gross margin decreased somewhat also due to product mix effects. But as we have stated many times for this reported segment of other markets, we usually see these quite big swings. And you can actually also see it there on the graph on the screen where some quarters come in really, really heavy with big order intake and others are a bit softer. And with our markets out of the way, we turn to profitability. And I'm happy to hand over to our CFO, David Granat.

Thank you, Christian. And now an update on the profitability for the quarter. EBITDA amounted to 26 million compared to 38 for the same period last year, giving EBITDA a margin of 13.0% compared to 16.4% last year. EBIT was 10 million in the second quarter compared to 22 million last year, reaching an EBIT margin of 4.9%. The decline is mainly due to lower reported net sales and to some extent initiatives in sales and development partly offset by higher gross margins. Despite lower net sales, we secured a healthy profitability for the second quarter. With that, moving on to cash flow. I'm happy to see that cash flow from operating activities amounted to 20 million in the second quarter compared to 40 million for the same period in 2024. In the first quarter, free cash flow was 1 million at the same levels as last year. Investments in tangible assets increased with 4 million. Also, as Chris mentioned, as less contracts were classified as financial lease, increasing investments in tangible assets. Cash at the end of the period was 34 million and net debt was 178 million, a leverage of 1.3 million. We are well financed with sufficient cash to deliver on our strategy and in addition we have access to a credit to facilitate potential acquisitions. And with that I hand over to Christian for summary and conclusions.