New Wave Group AB

Very, very welcome to the presentation of Q3 and to this day that we hopefully will spend together, all of us. If we start with Q3, I'm quite happy with the quarter. You can say I'm actually happy with all points, excluding the one-off cost we had in the US. But otherwise, the growth is up to 8.3 if you combine organic with acquired. In local currencies, I should say, because in the whole P&L, the currency affects quite a lot on all lines. So we have come closer to the minimum of 10% again that we want to have in growth. Here is really nothing new. The number of employees will increase the coming quarter due to Cotton Classic. If I understood correctly, Anna is in this figure with one twelfth part of the employees there. So that will increase. We are out in 25 countries now, and the segments you know. Yeah, nothing has changed here. I think I recognize most of you, so I think you're familiar with those three different segments. The only thing, the big change is actually undercorporate, where you now have done since 1st of September, Cotton Classic in. But the external brands they are selling, we will not take up as a brand here. And they have started to sell our, and I will come back to that in the afternoon. Yeah, on the 1st of September, we consolidated Kotlin Classic, which is very, very nice. We have that as a point in the afternoon, so I will not talk so much about that in this presentation. We had one, of course, for the COVID loans in the US that are taken in Q3, and we also announced it before the report a couple of weeks before. I don't remember the exact date. and the currency continues to have negative reflections for us. I think that it will be more stable, but no one knows. Quarter in brief, 8.3% sales increase, and including currencies, in local currencies, and including the... Oh, shit. Oh, shit. I thought it was closed, sorry. But in SEC it's 4.2% then. Promo channel was very, very strong, I would say with 7.2%. Retail was much weaker. And you can say the spread we have between... Those two distribution channels I'm very, very happy with because if we were only depending today on retail, it would be a very, very tough situation. In general, I was quite disappointed when they released, for example, the Swedish Sport Index for the third quarter. If I remember correctly, it was first 13 quarters in a row that were negative. And then Q1, Q2 was a little bit up. And I hope that that was a real change. But now Q3 came out with a small minus again. So I'm very, very happy for the promo channel and also if we see on a certain brand like Kraft, if we were only depending today on selling out from shop and didn't have team wear, corporate, it would be a very, very tough situation because the market on consumers is tough all over Europe actually. And it's a little bit hard to understand For me, because now people have started, consumers have started to have more money again, but obviously they don't spend them. And I talked with a lot of operators for restaurants, and they have the same tendency, even in Stockholm, where the restaurants actually are quite full. People spend less. They buy cheaper wines or two glasses of wine instead of one bottle and so on. And it's a bit strange. The only segment that's really doing well in retail today is the low-price segment. But it's a good combination. All regions continue to grow in local currencies. Operating profit, if we exclude this one off in the US on 66 million, this was just above last year's, which I think is very, very strong actually because we have a very high pace of investments in automatization and systems and also new markets now. So that could have been actually much, much, much worse. Also, I think we should point out an extremely strong gross margin. So we can say we don't use discounts and such things to hold up the sales. And that's also very, very nice. And this comes down in operating profit down off the one off on 253 million. Sales 2.390. I hope we soon can have a first quarter over 3 billion. Sales plus 3.6%. hand organic we have talked about and I think if retail becomes a little bit better or the situation in the sports retail especially where which are the biggest retail channels for us I think we can have and will have a very very nice growth actually corporate Net sales, we have talked about. Sports and leisure also. Gifts and home was a little bit down. And this is then not in local currencies, actually, because then it looks quite different. And geographical markets, North America continued to be the biggest one. What's happened there? Yeah, it's back. North America is biggest. Sweden actually had a quite nice growth, which are a little bit surprising because we have very high market shares here now on most things. Benelux, number three, and we have just taken Benelux out from the rest of Europe. And then Nordic regions, quite flat or flat. rest of Europe is up. And there, of course, in rest of Europe, Cotton Classic comes in nowadays. And we will look at that for not next year, but the year after, because now all Cotton Classic sales going into, I think it's, is everything going into Austria, Anna?

Yes, rest of Europe.

And there we should divide, if we can, when we have had it for a year, the different markets. The gross margin I mentioned, I think it's a very strong margin. It actually surprised me a little bit as well. And that also, I think, shows our position on the market, because with this weak market, a lot of companies are discounting extra and so on, and we can actually continue to grow with a full gross margin. And the quarter on 51.1, I think is... I'm not 100% sure of what I say now, but I think it's the highest ever, actually. So that's very, very nice. External costs increase. We will start to increase the IT costs again from at least 2027, I would say. And the reason that the IT costs increase is that we just right now pay actually for two systems, the old one and the new one. So it's not so much we can do about it. Operating profit, 253. And the contribution from Cotton Classic was 14 million this quarter. Here's the operating segments. And it's not so much to comment, I think. Of course, they are affected very much on sports and leisure on the one-off costs. and also a little bit actually on gifts and home, because it's all related, of course, to the U.S. and to this. Cash flow, operating minus 249, and that's planned, so that's nothing that worries us at all. It's both that we increase stocks and the new investments, so in launch we are doing with Teamware in... U.S. We also opened up now a new warehouse in Ireland, outside Dublin, in January. And we also launched a new concept in corporate and merchandising called Antec Movement, where the launch actually was this week, first at an exhibition in Germany, in Germany and Belgium, and then it should be rolled out in all countries in January. All European countries, I would say. For nine months, sales increased by 2.6% and promo up five. I also wrote in the report that I hope that we have the toughest time behind us on corporate because the growth has been better and better. And also we today meet much more positive clients and clients are more active today than they were a year ago. Then you can say it's very hard to predict because what is good today can be bad tomorrow because of what's happening around in the world and it's still very unstable. But hopefully it's a trend. And per operating segment, it looks like this. Done. And the geographical areas. And now this is in SEC. So, for example, North America is much, much better in local currencies. And that's a little bit surprising for me that the US is still, I wouldn't describe it as strong, but it's much more stable on the market than I expected with all those things that... and you wake up one morning and it should be 100% duty on China and the next day it's 50% and the third day they delay it. It's a total mess actually. So I'm surprised that the market there is as strong as it is. Gross margin also 0.1% higher than last year if we look at the nine months period. And the rest is more or less the same comment as it's on the third quarter. And operating segments, an operating profit on different segments. And here you can say I would be quite happy with all segments except gifts and home furnishings if it was not for this 66 million in the U.S. then. Still a very strong balance sheet, after consolidation of Cotton Classic we still have 52% equity so we can continue to grow, both by more acquisitions if we find the right ones and also of course we want to speed up the organic growth. with the new investments, with the new warehouses, and also with a lot of new products. I think I can say that we haven't had so much new products launched in many, many years. I think the last time we had so much new was actually when we launched craft teamwork. So we have a very good pipeline on products. Cash flow, it's not so much to comment. Rolling 12 months, we are 9.7 billion in sales. We would have been over 10 if we had the same currency in the past, but I hope still we can go over 10 billion very soon. in the rolling gross margin good costs we have talked about operate the margin 12.1 which i'm of course not happy with but i think we if we can be between 12 and 15 until we are coming down a little bit in investments i think it's still very good and i think we then have a very very strong position to actually start climbing up against our goal, that R20. Yeah, that's more or less what I had to say, and then we can open up for questions, if you have any.