New Wave Group AB

Okay, welcome to this presentation of New Wave Groups, quarter four and the full year 2025 figures. My name is Göran Härstedt and I'm the vice president of New Wave. And together with me, we have Anna Guldmarsland, CFO at New Wave. New Wave Group, we are a growth-orientated international company And we are focusing on acquiring, developing and creating brands for free business segments. And that's the promo, the sport and leisure and home and gifts furnishings. Here we have a slide about the growth in net sales and profit during the years. And we have a good development, especially regarding the turnover the last years. Logistics and sourcing is one of the main drives for New Wave and our activities and one of our most impressive strengths compared with the competitors. big sourcing operations in Asia where we had a head office in Shanghai and working in a number of countries and now also in Africa in order to source our products in a competitive way and also in a sustainability way. has our free operating segments and sales channels. And you can see here the brands that we are using in these segments. It's especially the sports and leisure and gifts at home furnishings brands that are known for the public due to that the corporate brands are more service brands for the concept towards the resellers who sell it to the companies who then is using their own logos or message on the items. A brief summary of the quarter. We signed a new financing agreement in December. And it has a prolongation for three and up to seven years. And it amounts to 3.8 billion SEK, of which 2.7 billion are used at the moment. Cotton Classic is consolidated for the full quarter for the first time in Q4. And during the last quarter, we also finalized the discussions and negotiations with the US Department of Justice regarding the forgiving PPP loans. And the result was in line with the cost that we were taking in Q3. We also have quite huge effects on the currency for the year and especially the quarter. Then we have the financial information.

Yes, thank you. So the quarter in brief, we have in short growth in both sales channels and all three segments. In local currency, we grow by 17.7%, of which 11.7 is from the acquisition of Kotlin Classic and 6% from organic growth in local currency. And as Göran mentioned, we have a headwind from currency, which is minus 6.5, but still reporting a growth of 11.2. Looking at this, I think, given the tough times and a bit troublesome times, we're quite happy with the 6% organic growth and feel that it's proof maybe of the model that we have with diversified diversification and different sales channels and are happy to show 6% organic growth. Looking at the operating profit, it was 435, which is a bit lower than last year and the operating margin ended at 13.8%. And going into the details, I can see here about the sales per sales channel. The sales were 3.145 billions for the quarter, which is, as we mentioned, quite higher than last year. And as you can see, we have increased in both promo and in retail. and of course in promo cotton classic is one of the big parts but we also have growth within several brands like both both Katrin Back and Kraft are doing really well and we also see growth in the trading and Tencent has also had a good quarter. So, and this is the sales per operating segment. Again, currency has been tough on us this quarter, but we show increase and growth in all three segments. as shown, and again, of course, incorporated fine cotton classic. The currency, we keep coming back, but this is a picture where we can illustrate. This is the sales divided by the geographic areas that we report on. And as you can see, looking at this, it even looks like there are three areas that we might have a decrease instead of a growth. And if we look, talking about currency, you can see the American dollar has been really tough in this quarter, it's minus 13% to us. And the Euro, not as much, but it's all, this is what makes up the net of the minus 6.5. So taking that into account, this is the organic change and the change in local currency. So what started as a mine, as you can see, we have a really good development in North America, which we're really happy for. And also looking at this, it's actually only one area where it's still a minus, and it's the other Nordic countries. And that is actually explained quite easily. I think many of you remember that in the beginning of 2025, there was a Nordic Ski World Championships in Trondheim. And if Thorsten would have been here, he would have told you exactly how many athletes were competing in Kraft, winning some kind of medal. I don't remember that number. But of course, in Norway, we had a lot of sales in the end of 2024. We did not only dress the athletes, a lot of other sales as well. So that kind of sale, we didn't have it at the end of 2025. So that is mainly what explains other Nordic countries. Move on to... The gross margin for the quarter, it's 48.5, which is lower compared to last year of 50%. And this is the first quarter that we have included Cotton Classic, an entire quarter. And they've affected the gross margin by 2.8%, which is natural because they have a different kind of business. So looking at like for like, gross margin would have been 51.3%, which we think is really good because it's actually better than what we had last year. Looking like for like. Moving down to external costs and personnel costs, they amounted to 1 billion compared to 887 million last year, which is an increase of 118 millions. And of this Cotton Classic, the acquisition is half of the explanation of this increase. And in the fourth quarter, we also have a lot of costs regarding our new ERP system. It's actually an investment. But as accounting regulations are these days, instead of putting it in the balance sheet and taking it through 10 years, for example, this comes as a cost day one. So it's not anything that makes the ERP more expensive, but the cost is shown much earlier in the P&L. So these two items together make up for 80% of the increase in external costs and personnel costs. Yes, as we said earlier, operating profit 13.8% in operating margin. And the operating result is divided like this. as you can see here on the slide between the three segments. Yes. Nothing to add there. Cash flow for the quarter. 534 from operating activities. And what's worth to mention, it's fairly in line with last year. It's worth to mention here that all the investments that we make in the ERP system, no matter if they are directly in the P&L or if it's somehow accrued in the balance sheet, It's always in the operating activities. So that never goes as investing. That can be good to know. And as you can see, investing activities, we also have a lot. And we have been investing both in optimization of inventories and buildings. And that's mainly... We can see by the end of December or by the end of the year, in December really, we started, we've told you that we are building a new fulfillment center in Dallas. So the first investment in that took place during December. So we're looking ahead. We're also looking at Ireland for a new warehouse.

And also the warehouse in France was completed in December. And we're also building a new facility for Top Point in Poland with printing, etc. It's a larger, big establishment we're making in Poland that will be ready during late spring this year.