CTEK AB (publ)

Thank you, Operator, and a warm welcome to all of you to today's Q1 presentation for 2025 for CTEK. The presenters today is myself, Henrik Fregenius, and our CFO, Tom Mathisen. And as always, I start with a short recap of CTEK. CTEK was founded more than 25 years ago by Bengt Wahlqvist, the happy guy on the picture. And he invented the first ever smart charger with pulse technology. We are delivering, we are developing and testing and designing everything in Sweden. And we have production mainly in Asia and China, but also in Malaysia. We have more than 50 premium brands that are choosing CTEK as their charger and I'm very proud to show the Lamborghini that is actually co-branded with CTEK which is extraordinary and says a lot about our quality. CTEK has mainly two different technologies. We have the EVS technology where we are focusing on destination charging and then we have our low voltage where we are present in different segments as consumer, professional, workshop, client, brand and integrated solutions. You will find CTEK in a vast area of different usage alternatives for the electrical vehicles and plug-in hybrids. We can sell our EV chargers of course, but also our 12V chargers and our workshop chargers. the combustion engines we have our 12 volt chargers and our workshop chargers and for rv and leisure like motorcycle camper vans etc we have our low voltage and also our integrated solutions and for industrial we have integrated solutions We are distributing in mainly two divisions. We have a professional division that is focusing on business to business. They have the OEM car brands and also big parking operators and short point operators. And then we have a consumer division which are selling into retail and e-tail. So then over to the first quarter of 2025. We were growing for the fourth consecutive quarter and the sales or revenue came in at 213 million SEK, which is an organic growth of 5%. Gross margin ended up at 56.4%, very strong, due to a good product mix. EBITDA, 19 million SEK, impacted by non-realized FX impacts. And cash flow, 8 million SEK, and we came in on a net debt ratio of 1.9, so very stable financial situation. If we look a little bit more deeper into the figures, we have consumer division, which was actually growing for the seventh consecutive quarter, strong sales in North America, strong online sales. And so our efforts there is paying off. I'm very happy to say that the professional division showed a positive EBITDA for the first quarter since we started that division. And that was due to growth in the client brand, where we had good sales to Europe's biggest motorcycle manufacturer. And we also see better margins on our newly introduced CC3 EV charger. So with this, I think we are very good placed for soon entering into our third phase. And we would talk more about that in our Capital Market Day, the 22nd of May. So with that, I leave the word to you, Tom.

Yes, thank you, Henrik. So some more words around the financials and I go a step down to the divisions. And as you can see, the consumer division, On the graph on the upper side right, you can see that stands for more than two-thirds or around two-thirds of the turnover of the company. Here we have grown again organically. We have 7% with a stable and good EBITDA modeling of around 35%. So continuous good performance in the consumer division. Coming over to the professional division, which stands for one third of the turnover of the company. We are happy to say that we have the first profitable quarter since we started the new organization in end of 2023 with a positive EBITDA of around 6%. That comes, as Henrik mentioned, both from the strong low voltage sales to the OE customers, but also from improved margins on the EVSE side of the business. Around cash flow and capex, which is quite important areas, of course, for a company like CTEK. uh we continue to have a positive cash flow from operating activities a bit less than last quarter one last year but that is mainly reflecting some bigger payments in and out at this periodical impact of that so as we mentioned a little bit later in in this in the fourth bullet we see a long-term positive cash flow trend That also means that we did an extra monetization of our loan with 25 million euro per period. CapEx, as we have said before, it's now coming back on the more normal levels, around 8% so far this year of the turnover. And we, over time, see that being somewhere in the area of 6 to 8%. Net debt ratio, also an improvement versus quarter one last year from down to 1.9 from 2.2 at the end of quarter one last year. So by that, I hand it over to you again. Thank you, Tom.

So to summarize the quarter, moving back to our strategic plan that we put together a little bit more than one and a half year ago, and we put it into three phases where the first phase was to create stability and cost control. We left that phase a year ago and we are now well into phase two. which is profitability and focus on organic growth we have now showed four quarters of organic growth and we are getting ready to talk about a more accelerated growth which we will present at our capital market day the 22nd of may so most welcome and i hope to see you all there Going into the quarter again, as I mentioned, fourth quarter of consecutive growth for the group and seventh quarter of consecutive growth for consumer division. First ever quarter with positive EBITDA in professional division. And that relates to high sales of client brand and also a better gross margin for our newly introduced CC3 EV charger. so uh we have a very stable financial situation and net debt rate you well below our financial targets so we are ready for our next phase which we will present on our capital market day the 22nd of may and with that i open up for questions

To ask a question, please dial pound key five on your telephone keypad. To enter the queue, if you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johan Eliasson from Kepler Shoebrew. Please go ahead.

Hi. This is Johan at Kepler Shoebrew. I have a question just regarding your North American exposure. You mentioned that as a growth driver in this quarter. How big is North America for you today now when the GM contract is out of the numbers? And how do you supply it basically? That's my first question.

Good morning everyone and thank you for the question. North America was last year without GM a little bit less than 10% of our total sales. We moved the production to move the production to Malaysia for 80% of our total of 80% of our products to Malaysia. And the tariff is hard to foresee, but my judgment today is that we are in a pretty good spot. I think it's neutral due to competition, because I do not believe that there is anyone producing locally in America and all our competitors are producing in Asia. And with the move to Malaysia, I think we are in a relatively good spot as it is today.

Yes, the question that you say 80% Malaysia, is that for the North American sourcing or is that for your total sourcing?

That is for the North American sourcing.

Yeah, okay, excellent. Well, I'm looking forward to the 22nd of May, so I have no further questions right now. Thank you very much.

Thank you, Johan.

If you wish to ask a question, please dial pound key 5 on your telephone keypad. The next question comes from Mattias Ehrenborg from Redeye. Please go ahead.

Yes, good morning, Henrik and Tom, Mattias here from Redeye. First off, I just want to congratulate you on a solid quarter. A few questions from my side. Could you share if there's any main driver behind the positive EDTA in the professional segment? Or is it more a general result from your cost savings and I guess overall solid demand in all product categories and customer groups?

Good morning, Mattias. Yes, it is. We have reduced the cost quite significantly in that division. And as we mentioned previously, it's up to getting volumes now to get a positive EBTA. And that we managed to do in the first quarter. So it was a good growth in client brand, which is the low voltage chargers for our clients. premium customers. But we also have a stable sell out of our EVSE destination. So if we remove the GM contract, we have a stable sell out of EVSE destination with a better margin, which also helps to have a positive EBTA.

Okay. And did you have any positive one-off effects from the discontinued GM contract in this quarter? No, not at all. Okay, excellent. I think this already has been answered a bit in the previous question, but could you describe your US business in the quarter and how your customers are feeling in the region?

If we start with the quarter, it was very good sentiments. We had high sales, especially on our online channels. With the move, we managed to reduce our pricing a bit with kept margins and that we saw positive take up from our customers in North America. uh so as i mentioned before eighty percent we have now produced in malaysia and at the moment the tourists from malaysia is ten percent uh we don't know how that will will develop but it's relatively good uh for us uh compared to some of the competitors i think So we look positive at that. Then, of course, it's very hard to say anything about the future and the sentiment of our customers and consumers in North America at the moment.

Understood. Just look at the Q1 numbers. You had 70 million roughly in sales from Americas and you had 21 million in Q1 last year. If we remove the GM volumes from last year, what would be a representative number, you say?

In North America specifically? Yeah, exactly. So if we remove the GM numbers from there, 21 million. We don't reveal that on that detail, but I can say that we had a good sales development if we clear for GM activities.

Okay, excellent. Thank you. If we move over to the DAC region, it grew by, I think, nearly 60% year-over-year, which looks very high. What are the reasons behind this development in the quarter?

had a also very very strong online uh sales but also our professional workshop chargers are are developing really really nicely uh and especially in in the duck region okay so it's not um there aren't any timing effects that and the q4 last year for instance instead of going to q1 or it's it's just poor pure demand driven would you say it's it's very hard to to say if it's uh if it's timing effects because you always have there could be timing effects between the quarters but we we are of course closely monitoring the underlying sellout at our uh especially our big online or e-tailers and we see a very healthy growth in those figures okay thanks uh and um

Just regarding the development for the CC3, especially in the UK then in the quarter, what was the development like and what do you expect now heading into the summer months?

If we take CC3, our short storm connected free, it has been very well received by the customers. The UK sales have not really taken off yet. So it's hard to say we are working closely with our customers in UK and also in Scandinavia. And later on, we will also launch it in Germany, as you know. But so far, we have seen a stable demand in a very, very turbulent times.

Okay, thank you. Understood. And just a final question from my side. Could you expand a bit on the Q1 net finance of minus 13 million? I see it looking quite high.

Yeah, I can take that question. Yeah, so it's actually we are impacted both in in financials and net finance, finance net and on the operating result of non-realized FX impacts. You know, when the krona has been stronger against both US dollars and euros, we have some impact on that. And on the finance net, it's primarily that we have quite a lot of euros on our accounts and they are evaluated to one krona less per euro than during the quarter. So that's the main impact. So around 8-9 million of that impact is just non-realized FX impact.

Okay, thank you. That was very clear. Okay, that was all from my side. Thank you very much for taking all my questions.

Yeah, thank you, Mattias.

Thank you, Mattias.

No more questions at this time, so I hand the conference back to the speakers for any closing comments.

Thank you very much for listening in to our Q1 report and looking forward to see you with 22nd of May in Stockholm. Thank you so much. Bye bye.