Litium AB (publ)

and the Swedish Webcoach with Lithium, where the CEO of Patrik C.Klin will present the third quarter for 2024. After the presentation, the Q&A will be held. If you have any questions for Patrik, please send them in with the form to the right. If you have said that, I will hand over the floor to you. Thank you Ludvig. As I said, my name is Patrik C.Klin and I am the CEO of Lithium. I will take you through the quarter support for the third quarter. I have our CMO Malin Baudolla with me in the studio, who handles the chat and other forms. If you have any questions, please ask them in the chat or watch the live stream afterwards. I will start by telling you briefly about Lithium and our winning propositions on the market. We will then go into the Q&A and talk about the future. Let's go! Lithium, for those of you who know us, you know that we are a tech company in e-commerce. We sell and manufacture software that allows you to run digital trade across the world in a large class. The product is a so-called e-commerce platform that contains the most paid parts in the core technology to drive advanced trade across the world. It will allow you to trade your products, show them, have relations between them, how they are, white papers, and other products. This allows you to make decision-making decisions as a buyer. Then we have e-commerce parts. Most of it is for campaigns and to switch the product data to the decision-making. After that, you can trade orders and fulfillment and so on. It's also about performance, because it's all about operating. Together, what is built together will be ready-made in the package. Then you take it together with your partner, we work with our partners, who write it together and then it is distributed to the exact needs you need. Then you go to 14 different markets and have very complex products, like configurators or that type of adaptation. Then you put together the rest of your technical stack, which normally includes an advertising system, a logistics system and personalization. Together we have a complete tech stack with lithium in the core to drive advanced digital trade. Regardless of what market you have, whether it is a business model, or BTC, or BTC, something in between, BTC or BTC or Recognition Merch, regardless of the number of customers and targets. It is a very advanced tool for driving advanced digital trade. That is where we are at. There are some customers who have discovered this. We are very proud of our customer list. We have this picture from B2B on the left to B2C and -to-Consumer models on the right. This also shows the versatility in platforms, that it can be used in many different types of fashion models. We have many different types of products. We have customers who sell everything from steel to marble to the latest in fashion, if very fast, the exchange rate in their products. And as I said, it is as fashionable as Ranger from B2B to Old Sailor to Retail and the Recognition models. We have a lot of potent technology in our workforce that can be used in many different ways. Many customers have discovered this. We have today 200 customers, it is between 20-50 billion SEK per platform every year. We deliver at a high level, and our customers are generally a little bit more forward in digital trade. We are a little bit more happy and proud. We are a little bit more happy and proud to see proof that our mission statement, that our customers are going to test their competition in digital trade, is really happening. This time we are going to lift up our customer Revolution Race, which won a nice prize at the Swedish Trade Fair, the big annual gala, to be the year's international expansion fund. It's great, congratulations, well done Revolution Race. We are very happy to have contributed to your journey the last five years. We hope we can continue to work well forward as well. It's great work, it's great to see that the users get to see this effect grow so quickly out of the world. It's also good to move over to our own performance in Q3. We have not raised any bullets from the cross-report, you may have already seen it, it was published this morning. The most important thing for us this time is to highlight that we have improved our EBITDA, the rate of movement at EBITDA level, by about half a million. We have broken through to the slowest, which is what we have been highly prioritized by, or highly prioritized, I would say, the last year and a half, to turn the business into slow, to get positive cash flows and all that. We have reached that. We also have a positive cash flow in the quarter, a strong and stable cash flow, so the important thing with this is that we have muscles to start investing more in growth. That's what we're working on from the point we left off. We will of course finish this year and our goal is to have a positive EBITDA for the whole year. But after that, we will look more and more at how we can grow in a faster and more accelerated way forward. That's where we focus more on now when we are done with this white balance. Additional profitability parameters at our EBITDA level, the rate of movement at EBITDA level has improved to .7% now, and it's the seventh quarter in a row that has done so. So we have a more incremental improvement, which shows that we have worked with the effectiveness of this improvement over a long period of time. We have achieved the same results as last year, but we have done it and it feels great. And this in turn makes a big, stable step towards our goal for the year, which is to have EBITDA for the whole year. Looking at the market, we can see that optimism has returned. We have felt it already in the first half of the year, but it is still a bit of a detour. We have started to return to the will to invest, but the focus has not been so much this summer. But now, after the summer, we have taken a whole new step in the market. It is both business processes that are moving faster, we have more in the pipeline, there are more closed-door businesses, it is a good part of the universe this year, and it is just a high level of activity throughout the market. So it feels like the morning air is back, and we believe that it is in the beginning of a moving market. We have a very good position, because we are strong in B2B and we have a lot of the technology that is needed to run digital B2B trade in our platform. Which means that we are well positioned in the market, which in turn is the fastest growing, we still experience a little tougher and slower closing cycles, and that B2B has a good speed. But in summary, for Q3, we are self-financed now, we have good position in the market, good position financially, we are strong and we have the opportunity to grow better when we look down the road. If we dive a little deeper into the key words, ARR, we have a long range of incremental growth behind us here as well. Now we grow by 5% year over year here versus 2023, and there is nothing remarkable about that in itself, but the positive thing is that we have experienced ourselves, we sign more deals, we have experienced that the business situation is better, and after a number of customers who have gone live during the quarter, which is a joy and a contribution to the fact that we can get more moving revenue for ourselves as well. We are aligned so that when customers succeed, we will succeed better, so we have had a lot of good go lives, for example 848, the cool outdoor company has gone live, and the rich shoe dealer Bergkvist Skor has gone live. During the quarter, we have a large laboratory director in Norway, who is a close associate to the live show during the quarter. We have also signed a whole new, both new and expansion deals during the quarter. This is fun, it starts to feel good in the weather tomorrow. Looking at the revenue, we have blue staples as revenues and yellow dots as revenues, so the revenue was flat and a little bit higher, it is good to be able to grow a little bit, but what I think is more worth noting is that all our revenue is recurring, because no part of our revenue is from sales or sales or anything like that, which you can find in a business, because it is purely from the product, 100% which is 100% recurring. The mix of revenues, this time 82% was fixed revenues and 18% was from sales, you can see that the business model that we have more moving in our contracts is starting to be noticed a little more now, after we have had a business model in the market for about two years. We expect that the moving parts of our revenue will go up in the future, which is when a market, if you are on a market that is starting to go well, that it is changing, that our customers are starting to sell more, we are also getting more of our revenue, so it is something we see in the future that can help us in the growth of course, and that is how business models are designed to do it. The break-in margin was a little lower this time, 66%, but usually there is a lot of fluctuation between the quarters, and of course how much revenue was in that quarter and how the mix looks there, and also a part of the turnover effect, we have had a lot of larger customers who have changed from the old one. A new contact with the new commerce cloud during the transition period, then you often double the environment, which we also increase the costs, but it is such a coincidence that we have not recovered. We expect that our serverless investments will rise towards the break-in margin of -74% over time, so that is where we are heading towards. The cost side and the margin of movement at the EBITDA level, we have, of course, as you can understand, our profitability has improved, so it is a fairly simple matter, but the revenue has increased, but also the costs have decreased, and we see that again, we managed to reduce our turnover a part of this quarter as well, and increase the EBITDA, it is an absolute number, to 4.3%. EBITDA margin, over 25%, it started to be quite smooth, it was a company with character, but we see that we will rise to the EBITDA level, and we also have the intention to continue to invest in our products, to grow faster and stronger as we move forward. EBITDA has already been on the rise, so we need to improve it, but it is the name of the game, it is about generating money and surplus in the business, and it is EBITDA that manages the EBITDA. The difference between EBITDA and EBITDA, in our world, we have a lot of product development, and how to invest in it, and if we look at that, we have a decrease in product investment, somewhat this time, it is quite marginal, we continue to invest a whole lot, but now we have released the big work streams in backlogging, in product development, the last year we have been Tedless and Surbless, and we have released that in the first half of the year, so it is a little easier, we do not need to push on extra in the identity development. Our cash flow has been strong, good cash flow also in Q3, which we feel we have a very stable financial position, which is good, because we can invest in growth initiatives, which we are doing a lot, and we will do that here. So, if we look a little forward, we have, if we start with the stability in the business, it was the highest agenda for a few years, so we think we should not only talk about potential opportunities, but there is also very stable stability in our business. First, we have a SaaS model, we have customers who subscribe to the platform, and as I said, 200% of our revenue is from the product and recurring recurring. We are high-stake, we deliver a type of core technology that you need for digital distribution, regardless of what type of professional user you have to have a good PIM to be able to drive advanced digital use, because there is a lot of uncertainty and complexity in the types, and it is possible to do it in a different way, and it is the core, the cornerstone of our part of the product. So we have core technology to drive digital distribution, you need a business system, you need to have an online platform to do this at a advanced level, and we have a scene. And also, in general, our installed base is customized to customer-specific needs, so as long as you are satisfied with the performance of the technology, which customers are, you are also invested in it, you are satisfied with what you should change, so the performance is high. We have very strong -the-shoes and good fasts in the B2B target group and the target market. The digital trend of digital distribution is stronger here, in B2C the average is usually 6, and the platform is more of a replatform, you grow something out of a smaller solution than you have when you come to lithium, and then you can be in lithium forever, because you do not grow out of lithium. But B2B is, as I say, the same population, more unmarried than B2C is, you are not really as far ahead in terms of digitalization and sales. But now it really starts to happen, now it happens in the generation shift, both in companies and among buyers, so you are more and more forced to move in this direction, which is why we have a good position there. Solid cash, good, because we can invest, we are self-funded, we can invest in sustainable growth, and that is where we go after the growth, nothing else. When it comes to growth and scalability, we have our platform, the Lithium Commerce Cloud, which is really top modern, we have refactored it over the past few years and added new capabilities to it, both in structure and functionality. So this modular, it is fast, it is flexible, it delivers on everything the customer needs out there, and it is also able to pay both to sell more, but also to sell effectively or to make sales more effective, so that it is both cost-effectiveness and increased revenue that only customers can reach through the use of our products. We have invested in another technology, which is called service technology, which allows us to drift the customer's environment more effectively and more dynamically for them, and make it easier to manage our partners, so it is really -win-win in this, and it also allows us to quickly and easily connect third party services and integration buildings to other things, other people in tech, and that is what we are doing under Q1. So it is both saving on the drift side, more dynamic drift, and the possibility of getting better results, and that is what we believe in when we move forward

with

App Cloud and the type of modularity that it contributes. We have a business model that is designed to grow with our customers, we have not had any winning draws in the last two years, because it has been out of the market for almost everyone, which we all know, but now when the market looks to turn a little further, we have the opportunity to get a little more of that with us when we move forward,