Ework Group AB (publ)

Through our vast global talent network, we have access to over 225,000 consultants and 30,000 partner companies globally. Today, around 10,400 consultants are on assignment onshore, nearshore and offshore across more than 50 countries. IWO currently operates in 12 sites across 7 European countries. During third quarter we announced our expansion into Germany with planned opening next year. A key step in our strategic growth plan towards a strong position as a leading talent solution partner in Europe. Whether it's about individual talent, teams or advisory, we focus on business needs and real value. We are powered by people and driven by impact. Our offering is a total talent solutions portfolio centred around workforce management from strategic planning and talent acquisition to ongoing optimisation and this makes us a full service trusted partner to our clients. At the core is our find and select offering supported by modular services that can be combined just like Lego pieces to meet each client's unique needs. ensuring efficiency, quality and security in every activity. In addition to our core services, we provide a set of value-adding services for both clients and consultants, such as e-work services, PayExpress, protective security services, including background checks, permanent recruitment and nearshoring. In 2025, we are elevating our proposition in talent advisory and expanding our nearshoring capabilities to help clients optimize cost and get access to the best talent globally. Now, over to the third quarter. This was a quarter marked by a mix of continued caution and limits of light. A number of our enterprise clients paused to reduce consultant engagements while price pressure increased, particularly for our core services in the Swedish public sector. Despite the challenging environment, we successfully won and extended several key frame agreements. We strengthened our position ahead of a broader market recovery. The Swedish talent market is mature and remains highly competitive, however with large demand for talent. Following the uncertainty related to a new labour legislation recession, Norway is now stabilising, and in the quarter we won new public contracts at Ullensaker and Skatteetaten, as well as renewals of several existing agreements. In Denmark the market remains mixed, with high demand on one hand and reductions on the other. Finland experienced a certain decline in consulting services in the quarter, while securing a major public sector contract. Meanwhile, Poland continues to perform well despite tougher competition, much driven by the continued strong nearshoring trends. Slovakia shows promising growth in consulting and recruitment services, and in Belgium, local operations have now been established with Ghent as a base. Preparations for our market entry in Germany are also underway, with plans to start operations in 2026. AI is playing an increasingly important role in our client assignments with the number of AI-related projects tripling in our platform compared to those without AI elements. This clearly illustrates how rapidly the demand for skills is changing. We are beginning to see the effects among large enterprises where broader transformation efforts are now underway highlighting the importance of strategic workforce planning to ensure the right skills for development and competitiveness. Here, eWork's new Workforce Future Readiness programme supports clients in aligning their business strategies with long-term workforce planning. Our talent network continued to develop positively in the third quarter reaching 227,000 registered consultants with a majority in IT. Our talent specialists are working systematically to strengthen the network with the right skills and to build long term relationships with consultants, suppliers and partners. All of this is done in line with the market demand, which in the third quarter was particularly high for skills in AI, software development, technical testing and verification. The demand for our add-on services, particularly PayExpress, continues to rise and we see a growing interest in insights, guidance and advisory related to the volatile global environment. This is also driving growth in our protective security services, including background checks and related security offerings, which are now being rolled out across all markets. The growth in add-on services contributed to the continued positive trend in our gross margin, which increased to 4.2% in the third quarter, in line with eWorks' strategic focus on value creation and more profitable business. The EBIT of 28 million SEK was impacted negatively by costs related to our strategic initiatives in digitalization and automation, as well as restructuring and the group conference. Current operating costs are developing according to plan. Finally, our new digital platform is now operational across the Nordics, enabling automation, AI-driven matching, and greater efficiency. It will help us improve quality, objectivity, and lead times for our clients. And more on that in a coming slide. Our rollout to Poland and Slovakia will follow in the fourth quarter. Switching focus to our markets. In Sweden, order intake and consultants on assignment decreased during the third quarter compared to the same period last year. The uncertainty regarding tariffs, challenges in supply chains and continued cost focus in our clients' businesses are some of the main drivers behind the weaker demand and declining volumes. Poland continues to show strength, while not growing with the same speed as in previous periods. The growth comes from a continued capability to capitalise on the European trend for nearshoring, as well as developing local hives to further boost our volumes with profitable growth. In Norway, the trend is now more positive, following the new labour legislation and overall recession in the recent years. We have strengthened our position in the public segment, which provides a stable revenue with a growth in profitability underpinned by a more favourable client mix. In Denmark, earnings increased based on positive development in a more diversified client portfolio. Lower internal costs is impacting the result positively in the period. However, we also saw a slowdown during the quarter after a long period of strong performance. And this was mainly due to cost and workforce optimization activities at key clients and led to decrease in order intake for the quarter. Finland showed strength with increased revenue and stable profitability in the third quarter, despite a declining market. We do, however, see signs of a slowdown with a decrease in order intake for the third quarter. Finally, we are, as said, establishing new operations in Belgium with Ghent as a base, and have hired a local sales representative who is now leading our business development activities locally. We see good opportunities for growth at new and existing clients, and we leverage a global operating model and platform to support further expansion and scaling. Looking at our industry segments in the third quarter, we saw an increasing strength and demand from our public sector clients, where we added new frame agreements in Sweden, Norway and Denmark. The ramp-up of consultants on assignment at Swedish Klient Svenska Kraftnät is also contributing to overall volume growth. All of this means that the public sector is once again a larger segment in the third quarter. The uncertainties in the automotive segment stemming from macroeconomic policy changes led to various cost reduction programmes in our clients' businesses, which in turn affected E-Works consultant volumes in the quarter. Following this, the automotive segment decreased its share of e-works industry coverage to just about 20%. Within the private sector, we see a continued increase in demand from clients within banking, finance and insurance, as well as higher activity in telecom, which leads to a growing number of consulting requests and a favourable growth in the segment. The remaining segments generally reflect the market sentiment for the quarter. And one segment that stands out from the rest is live science, where we expect a temporary slowdown in the Danish market related to workforce restructuring and transformation activities. As I mentioned earlier, with our new digital platform now operational across the Nordics, we've taken the next big step, integrating AI into the very core of how we operate and deliver value, both for our clients and internally. Over the past quarter, our focus has been on enabling automation and efficiency within our own core processes. And a key milestone is that we've now gone live with AI-driven candidate matching. This allows us to connect the right talent with client requests faster and more accurately, improving both speed and quality in our delivery. And this is not just a technical upgrade. It's a real enabler for our teams to focus more on relationships and value creation for our clients. At the same time, we're working on automating the entire request to contract process for consultants. And this initiative will create smoother workflows, it will reduce manual efforts and provide a more efficient experience both for suppliers, consultants and clients. It's an important step towards making our business more scalable, predictable and resilient. In the near future, feedback and responses both to suppliers, consultants and clients will be powered by AI, which will create a faster, more efficient and transparent process for everyone. This ensures that communication keeps pace with our growing scale and enhances the overall experience for all stakeholders. Looking ahead, we will bring AI even closer to our clients and consultants. With the upcoming digital client portal now under development, we will empower clients to manage their engagements more independently, with full transparency and data-driven insights. This represents a major step forward, positioning eWork not just as a services company, but a true platform provider. In short, AI is not a side initiative for e-work. It's embedded in how we create value for our clients, consultants, and suppliers, developing our business, shaping the future, and continuously strengthening our position in a rapidly evolving market. And with that, Johanna, I'm glad to hand over to you.

Let's move over to some numbers then. Looking at the financial overview of the third quarter, we reported a net sales of approximately 3 billion SEK, which is about 7% lower than last quarter, where we reported a net sales of 3.2 billion SEK. This drop is related to the slower market and mainly to the Swedish market that is also our largest with the biggest volume and therefore a bigger impact. From this quarter we do not have effects from the previously reported phase out of non-profitable plan contracts and no calendar effects meaning we are comparing apples to apples. We unfortunately do not see any clear signs of recovery in the market short term. Some of our bigger clients have enforced consultancy freezes or reductions in their workforce as mentioned and we expect this to continue throughout the year impacting our top line. We continue to be proactive in sales and we are also winning new frame agreements also in this market setting which gives a better starting position for our market recovery. Continuing down in the P&L, our gross margin continues to have a positive development, 4.2% versus last year, 4%. This is still partly driven by our add-on services, where we are now ramping up sales activities further. We have seen a high demand for security services as a result of the uncertainties in our environment currently, and we are now rolling out the services in all of the Nordics. We see a potential to increase the volume of add-ons still. EBIT in the third quarter amounted to 28 million SEK compared to 39 last year. EBIT was negatively impacted by restructuring cost and by cost for group conference in relation to the celebration of e-work 25 years. And in total that amounts to approximately 6.3 million SEK. Other than that we are, as mentioned, doing investments in our new digital platform that is increasing IT costs somewhat. And the financial net decreased somewhat relating to currency effects. As mentioned before, we have taken actions to reduce exposure and that has already given effect. We continue to have a steady focus on our long-term strategic goals to increase our profitability by higher business margins and scalability. Looking at the order intake for the second quarter, it was approximately 3 billion SEK, which is lower than in last year, 3.2 billion SEK. The order intake decreased, especially in Denmark and Finland, impacted amongst other by reductions in workforce at one larger client. We have, as mentioned, seen consultancy freezes and cost reductions at some of our largest clients in the last quarters and expect it to continue throughout the year, impacting requests and order intake. We do also see that the automotive industry is a bit more uncertain given the toll situation and expect some negative impact from this during the year. Energy has gladly picked up where we are ramping up based on our new frame agreement with Svenska Kraftnät. We also see some positive signs from the telecom industry and we also see that the public sector in Sweden and Norway has stabilized somewhat and the drop is mainly related to private sector. From the third quarters as mentioned we do not have any impact from the previously reported phase out of less profitable client contracts. The decrease in sales as you can see in this slide in the quarter is due to the lower business volumes and less consultants in assignments. We can see that hourly rates remain stable still and the explanation for the drop is mainly Sweden where the market remains challenging. Our focus is still on profitable growth as mentioned, meaning that we will not sign frame agreements that does not meet our profitability requirements going forward. EBIT is negatively impacted from the lower business volumes as well, but also by the higher cost relating to the implementation of the digital platform and also by the restructuring cost and also the cost relating to the group conference. On the opposite side, we have a positive impact from the increased contract margins and add-ons that are driving profitability, which is really positive. And given the situation in the market, we are looking into actions on the cost side that can give effect both short and mid-long term in order to adapt to the current settings. And then I will hand over to Karin to sum up.

Thank you so much, Johanna. So to summarise this quarterly presentation, we do see a mixed momentum in our different markets and geographies, with stronger demand in Denmark and Poland, but continued restrained markets in Sweden and Norway, where, as I said, Norway is now stabilising. We're at the same time continuing to generate more profitable growth and we're seeing a positive trend in our gross margin as a result. At the same time, to further increase profitability, we need higher volumes and a broader client base. We also see a growing demand for flexible workforce management, which plays to our strengths. Internally, the implementation of our new digital platform is nearly done. It's a key step in improving efficiency and creating a foundation for further automation and AI over time. In short, IWA continues to execute on our long-term strategy and work towards our long-term goals. And now we will be opening up the floor for questions from the viewers and we will start with the questions coming in over the phone if we have any.

If you wish to ask a question please dial pound key 5 on your telephone keypad to enter the queue. If you wish to withdraw your question please dial pound key 6 on your telephone keypad.

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

Okay. Thank you for that, Karin and Johanna. We have a few written questions here for you, and the first one says, it seems the market was particularly difficult in Sweden. Why is that?

Well, it's mainly because we have a recession still going on and affecting several of our clients, especially in the enterprise segment. We are exposed to many clients with different types of challenges, but also strategies to further optimize the cost and workforce. And this, of course, impacts also the demand for consultants and contingent workforce. Now having said that we still see a big underlying demand for skills and for talent who can help with the transformation as an example into AI and automation where new skills and capabilities are needed. So it's a mixed picture. That's why we like to talk about the mixed momentum, because on one hand we see a reduction or cautious demand. On the other hand, we see major needs. And we are doing our very best at all times to navigate through these mixed momentums.

Thank you. Another question. There was a dramatic drop in order intake in Denmark. What happened there?

So Denmark has been developing very well over the last couple of years if we compare to Sweden as an example. Now we also see some of our clients in Denmark doing similar activities as our clients in Sweden. meaning they optimize workforce, they optimize cost, and this is natural development. But as I said, we also see bigger impact from the life science segment and particular clients with big activities going on that is affecting contingent workforce. So again, quite a mixed picture, but somewhat different from the previous quarter.

Thank you for that. Do you then see challenges in any industry in particular?

Well, as said, on a positive note, we see a certain stabilization in public sector across Sweden, Norway, Denmark. And this is a good sign. We do see big needs for talent and skills in public sector in general to drive transformation and development. But in addition to that we see the automotive segment of course being challenged with global uncertainty and volatile momentum and of course that also spills over on our business. And I said on the other hand again, we do see a positive trend in telecom Which we are also glad to see and we have a number of important Companies and clients in this segment as well as in in the financial services segment so quite a mixed picture with some segments stand out more than others and

Mixed picture again. Okay, thank you for that. And do you see any price pressure in the market?

Yeah, we do see price pressure for our core services and in particular the services in managing spend for clients. That's what we call managed provider solutions. Here we see quite a heavy price pressure. We see a very competitive market and a mature market in Sweden. That is of course driving things in that direction. Now we have a very comprehensive portfolio at hand ready to offer not just the core services but a lot of add-on services and additional services that we know clients value. and where we can be of great help. So we're doing again what we can to navigate through this very competitive landscape, also impacted by price pressure. Looking at consultants, it's a slightly different picture as we reported. So here we do not see a big impact on consultant hourly rates, driving rates down, as you could maybe imagine. But this has to do with also the demographics of the consultants we have on assignment. And we know that many of our clients are really keen to keep their senior consultants and the experts they need to drive business critical activities.

Okay, we have one more question here and it says considering the continued drop in order intake, do you see a need for further cost measures?

As said in Johanna's part of the presentation, this is something we are always looking into, to see that we are matching our cost base with the volume and our top line. And automation and AI will certainly be an important component in all of this because it will enable us to deliver services at a lower cost over time, and it will provide a very, very good platform for scalability when time turns and the market turns the other direction. So the answer is yes, that's something we're always doing. And maybe you want to comment further on that, Joanna?

I totally agree. And E-Work has done a lot of work with the cost base and we expect it to continue in these levels. And we are doing a lot of investments, so of course that will impact the cost side. But hopefully that will increase our scalability and profitability over time.

Okay. I think that was it. Thank you so much.

Thank you so much, Johan. And this concludes also my final and last quarterly presentation at Ework Group. And I'm happy to hand over to my successor, Daniel Almgren, to do the next presentation of quarterly results for the fourth quarter.

And that will be on the 19th of February, 2026.

Good. Look forward to that. So thank you. Thank you.