Mentice AB (publ)

Good morning and welcome, everyone. My name is Richard Engberg and I'm an equity research analyst here at TMB Carnegie. With me, I have Frans Venke, CEO and Ulrika Drots, CFO of Mentes. And today we're going to present the fourth quarter of Mentes. Frans and Ulrika, the stage is yours.

Thank you, Richard. Thanks for having me. We have Ulrika from Gothenburg. Unfortunately, she would not be here. So we are basically, Ulrika is virtually and I'm here in person. So what we have today for you is, first of all, the highlights for the Q4 results, as also the financial results by Ulrike, our chief financial officer. I will provide concluding remarks, and then we can go towards the Q&A. So overall, what we saw for the quarter, and this is also the summary to it, we saw an encouraging sales of 91 million Swedish krona. And so that meant an organic growth of 18%. And that was equivalent to 5% if you compare that or basically correct that for foreign exchange, and especially the Swedish krona, the strength of it. The full year net sales came towards 279 compared to 290 million SEC last year. Again, a growth of 3%, but also due to, again, foreign exchange, it was effectively a negative. So overall order intake, we were very pleased with 127 million SEC, an organic growth of 25%. And that really carried the momentum that we also saw in Q3 into the year. So full year, we had an intake growth of 8% organically, equivalent to 2% year over year, again corrected by foreign exchange. And this really showed that in the second half of the year, we had significant momentum. And that's also what you can see in Q3 and Q4, both in sales as also in the order intake. And that more or less corrected also what we did in the first two quarters of the year. EBITDA margin improved towards 25%. It was 19% the year before, and that also reflecting the positive impact that we had from, first of all, the higher sales, but also the cost measures that we put in place. And that is really driving towards the bottom line, and that's exactly what we would like to see. Strong growth, what we saw coming from the medical device industry, and that came primarily also from the Americas, as also from Asia-Pacific. The EMEA region normalized, and we saw basically after a strong year before, we saw that it was almost neutral in that regard. So the strategic focus for us remains on improving our healthcare systems business and making sure that we drive growth in those areas. What we do see here is that the market segment across the different three continents are effectively not positive to us. We are compensating for that by the growth in the medical device industry segment, which we see as quite going well. If we look at the business highlights, what we said is also that we would move our physical simulation business not only from Paris, but also from Stony Brook to Denver. And in the first two weeks of January, we have concluded this. And so this is now all consolidated into Denver, and that business is also up and running. This is also the desired impact also towards our cost structure, but also creates a more effective team where we have R&D, marketing, manufacturing, all co-located in Denver in order to drive our physical simulation business. The second piece is that we also saw quite a high market activity, and not only in Q4, but momentum that we started in Q3, in Q4, is also what we continue to see, as I said, especially with the funnel in place. So we saw that quite positive. It comes towards especially our hardware sales, but also the projects that we do as also the more or less the software sales and the licenses that come with it. What we do see there is that it's not only coming from a few of the medtech companies. It's a broad base of companies that award their projects and that we're working with, as I said, for new projects. And of course, that is positive. That makes us less dependent on a few big customers. We see that as a broad base, which bodes very well not only for more equal revenue streams for the future, but also making us more resistant to potential downturns from an economical standpoint. Activity of active approach towards the healthcare systems market, where we continue to invest in, in order to make sure that we change our proposition and that we're hitting the mark with propositions that truly resonate. Our expectation is that by the end of 2026, we will gain more revenues from this. It's an investment at this moment. So what we do see is that due to our large pipeline of projects which we have for the medical device industry segment is that we need to invest also in what we call our engineering and R&D environment. And that's also what we do both in Denver but also in Gothenburg. So we're hiring project leaders as also software engineers in order to support our customers and to accelerate those projects that could drive additional revenue also for us in 2026, but also in 2027. And we see that as very positive. So very selective investments in R&D and engineering where it drives additional revenue so that we have tight cost control in order to make sure that the earnings that we make are also, or at least the revenues that we make, are flowing through the bottom line as well. focus on the r d we are very actively focused on making sure that our realism is top-notch and realism we mean by is that how we do our simulations of of of especially devices in a body that they behave more or less as it close very close to reality And that could either be basically the feeling, the haptics, it could be how the devices actually move into the body, but it's all the entire anatomy as well. And we really stand out there. We are unique and are also being rewarded by our customers. And that's also one of the key reasons why they come to us in order to drive their projects with us. Finally, what I wanted to state is that what we saw in the final quarter of 2025 is that Gulf of Stream, controlled by the Hyrule family, increased their stake in Mantis. What it means effectively is that there is further focus on growth of the company for Mantis. And also this afternoon, there will be an extra shareholders meeting where there will be a change in board of directors composition going forward, or at least proposed going forward. With that, I want to hand it over to Ulrike, who will provide further guidance towards the financial figures from Q4. Ulrike, the floor is yours.

Thank you, Franz. So what we see during the last quarter of 2025 is, as Franz has mentioned, an increased impact on the market activities that we saw increasing in the third quarter. We saw that during the earnings call for the third quarter, and this is also what we show in the figures for the fourth quarter. Especially the growth in America, as Frans mentioned, is very strong, with an organic growth of 23% for the quarter. So that gives us a net sales of 91 million and organic growth of 18%. And we are, as Frans mentioned, and as we've said previously also, we are very impacted by the foreign exchange, especially the US dollars and the euros, because we have all our invoicing done in those currencies. And the growth in order intake during the fourth quarter led us also to an organic growth of above 25% for the quarter. Also really good to see is the EBDA margin and the result with 23 million, which is a good increase compared to last year. And this is a combination of increased sales and reduced costs, especially in employee costs, as an effect of the strategic realignment that was done in Q2. And I will come back to the cost implications of this. The order book leaving the last year had an organic growth of 4%. Taking FX into account, it shows a decrease of 6% if you compare year to year. And we have 87 million scheduled for 2026. Operational cash flow is lower than the same quarter in 2024 and this is due to the increased sales leading to higher working capital and accounts receivables. And looking at the full year, if you follow our earnings call earlier, you know that we like to look at the rolling 12 months perspective because it gives us a good view on the performance since we have variability between the quarters. And what you can clearly see in this graph is that the Decrease that was quite clear in the second quarter of 2025. And as Frans mentioned, we had a very good second half of the year. And that is shown in the figures where we moved from the 262 to 279 in Swedish crowns, million Swedish crowns. So the growth within the MDI segment in the Americas region continues. And as Franz mentioned, this is both with the existing large customers, but also a broader base of customers within the MDI segment. The region EMEA had a very strong Q3 and Q4 performance for EMEA was more stable. And last but not least, on the EBITDA margin, you see here the cost base is stable through the fourth quarter as well. And adding some more comments on orders and order intake, which you can see on the next slide. This really clearly shows the increase of orders within the MDI segment in the fourth quarter, where you can see the Americas region really growing in the graph on the upper right-hand side. And the HCS segment, we don't see it yet in the net sales, but we do see an increase in order intake, mainly actually driven by the region EMEA and APAC. And looking then at the perspective of net sales on the next slide. This is where you can see that the growth within the Americas and the MDI segment is really strong with an organic growth of 23%. Taking FX into effect, it ends up with a 10% increase. And as Frans also mentioned, we do not really see the performance within the HCS, the hospital segment. It has been declining for some while, and the strategic initiatives that we have been talking about have not yet given the results. And as Frans mentions, this is still a continued focus for us. And then finally, some comments on the cost base. As you can see in this graph, there was a reduction during the third quarter as an effect of the strategic realignment done in the second quarter. And we continue to have a stable growth. cost base in Q4. And this is key for us going forward to keep this tight cost control. So basically with this, we think that we're entering 2026 with a stronger pipeline, improved cost structure, and a strategic focus.