Elanders AB (publ)

Welcome to the Lenders AB conference call. My name is Alan and I will be your coordinator for today's event. Please note this call is being recorded and for the duration, your lines will be on listen only. However, you'll have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad. If you require assistance at any time, please press star zero and you'll be connected to an operator. I will now hand you over to your host, Florian Beck, to begin today's conference. Thank you.

Yeah, thank you, Alan, and good afternoon, everyone. Welcome to eLanders conference call for the third quarter of 2026. Thank you for joining us today. For me, this will be the first quarterly conference as I took over from Magnus Nielsen on September 1st as group CEO for eLanders. My name is Florian Beck, and with me here is our CFO, Asa Wilson, and over the next few minutes, I will walk you through our presentation for the third quarter. After that, we will take questions from the audience, and our operator, Alan, will guide us through until the end. Let's go directly to slide number five. Our third quarter was characterized by strong organic growth and continued improvement in results within supply chain solution, which is our largest business area. The organic growth for the group came in at 6%. When we adjusted for air and sea rates, our organic growth was 4% for the group. Very good and important for us to see that all regions and all customer segments contributed to the growth during the quarter. Our adjusted EBITDA landed at 210 million Swedish crown, which is an improvement of 29 million compared to Q2 this year and flat compared to Q3 last year. That corresponds to an adjusted EBITDA margin of 6.9% for the group, and our adjusted result before tax increased to 74 million Swedish crown up from 67 in Q3 last year. Moving on to slide number six, we take a look at our cash flow, cash conversion, and how our net debt has developed. Cash generation remains strong and improved compared to last year. The operating cash flow excluding acquisition improved to 565 million Swedish crown compared to 316 a year ago. And our cash conversion of 126% almost doubled compared to 73% in the third quarter of 2025. Our net debt excluding IFRS 16 decreased by 65 million Swedish crown in the quarter. working capital actually released 95 million while negative currency effects increased our net debt by 82 million so it's clear to see that without the currency headwind the reduction would have been even larger during the quarter we'll go to slide number seven and take a closer look at our supply chain solutions we can see that we had a very good quarter here with strong organic growth as well as improved results and margin the organic growth for supply chain solutions was actually 7% or 5% when we adjusted for air and sea rates. Europe and Asia continued to grow organically, but it was very good for us to see the positive developments in both the US and the UK with demand picking up in these markets. Our adjusted EBITDA grew by 12% to 204 million Swedish crown, lifting the adjusted margin to 8.2 million up from 7.9 last year. Our unadjusted EBITDA in absolute terms doubled from 102 to 204, and our cash conversion improved to 109%. If we move to slide number eight, our print and packaging solutions had a quarter which was more on the weaker side, with sales that were flat compared to Q3 last year and came in at 592 million Swedish crowns. Similar to the second quarter, we see continued growth in online print and publishing, but these sectors could not compensate for the declining automotive volumes. Adjusted EBITDA came in at 17 million Swedish crowns, which gives an adjusted margin of 2.9%. The main reason for this was weaker demand for the automotive sector in Germany, while other countries and sectors performed well. We have responded to this trend in developments with structural measures to adjust and lower our cost base going forward, which are expected to generate annual cost savings of around 57 million Swedish crown. In addition to that, we have successfully renegotiated an important long-term contract with one of our customers within Print and Packaging. We go to slide number nine and look at our various customer segments. We can see that electronics like in Q2 was impacted by the global memory chip shortage but still grew organically by around 1% driven by both Asia and Europe. Our customer segment fashion and lifestyle also grew by around 1% and we're seeing signs of improvement and demand in both Europe and North America. That's especially encouraging since in the US we were dealing with elevated churn rates in the previous quarters. The customer segment Other showed good growth, like in previous quarters, and grew organically by around 17%, driven by online print in various regions and also good FMCG volumes in the UK. Automotive has a very mixed profile for us and shows basically two different pictures. Within supply chain solution, which is also the larger part of our automotive business, we had organic growth of 25%. while print and packaging declined by 35%. When we look at it on a consolidated basis, we had an impressive 7% growth within the automotive customer segment. Industrial grew by around 3%. That was mostly coming from mainland Europe and was then partially offset by a decline in the UK. And last but certainly not least, healthcare delivered a strong organic growth of around 19% driven by supply chain solutions in Europe, Asia, and the UK. We move to slide number 10 and my conclusion. In summary, after two consecutive quarters of improved results in Q1 and Q2, the third quarter delivered another solid result combined with strong organic growth. It was mainly driven by our largest business area supply chain solutions. Despite continued challenge in the automotive sector and the ongoing global membership shortage, we demonstrated resilience as a global organization and generated organic growth in all regions and all customer segments during the quarter. Particularly encouraging was the development in the US and the UK, where new clients and increasing demand helped these regions to return to organic growth. Supply chain solution continues to grow profitable across all region and all customer segments, The momentum within supply chain solution combined with the structural measures and the renegotiated contract in print and pack makes me cautiously optimistic for the remainder of the year and as we head into 2027. Even though the world around us remains uncertain given the conflicts in the Ukraine and the Middle East, the global ship shortage, the struggling automotive sector and rising inflation as well as interest rates, which are exactly the key developments we are monitoring and we need to be cautious about going forward. With that, I conclude my short presentation. I thank you all for your attention, and I'm now handing back to our operator, Alan, for any questions from the audience.

Thank you. If you'd like to ask a question or make a contribution on today's call, please press star 1 on your telephone keypad. To withdraw your question, please press star 2. You will be advised when to ask your question. We will take our first question from Marcus Elmer, DNB Carnegie. Your line is open.