Pandox AB (publ)

Thank you very much and good morning everyone and welcome to this presentation of Pandox Year-End Report 2025. I'm here together with Leon O, our CEO, and Anne Liljenblom, our CFO. And today we also have the pleasure of having both Ifa Roche, Vice President at STR, and Rasmus Kjellman, CEO at Benchmarking Alliance with us. And they will provide a hotel market update on Europe and Nordics respectively. And as you know, SKR and Men's Marketing Alliance are both leading independent research firms, totally dedicated to the hotel market, and the views they express are completely separate from Pandox. And we offer this presentation only as a service to Pandox stakeholders. And please note that Ifas and Rasmus' presentations will be held after we have completed our former earnings presentation, including the Q&A. And we start with Lia and Anneli's business update and financial highlights for the quarter and the year, which in every sense was a very eventful one. And then we end up with the Q&A session. So, yeah, with that, Lia, please go ahead.

Thank you, Anders. And good morning and welcome, everyone. I agree that this report summarizes a very busy fourth quarter and also a full year 2025. Starting with our existing portfolio, I am glad to report solid like-for-like growth in both business segments in the fourth quarter. This is explained by broad-based improvements in the hotel market driven by active business demand and an overall solid event calendar and active leisure travel. Together with profitable contribution from completed acquisitions in the business segment leases and improved profitability in own operations, this resulted in a tangible increase in group earnings. In the leases business segment, demand improved markedly, however, still with variations between markets. The Nordics developed the best with good rent growth in Sweden, Norway, and Denmark, while Finland was stable. Growth in Germany was also markedly stronger than earlier in the year, while growth in the UK was slightly positive. Like-for-like revenues increased by 5% in own operations in the fourth quarter, which together with a positive business mix and good conversion resulted in a like-for-like increase of 16% in net operating income. To be fair, part of this uplift is explained by one-time cost in the corresponding quarter last year. For the group, total revenues increased by 9% and net operating income increased by 22% in the quarter. Dalata is included in the numbers from 7th of November and from the fourth quarter we report the acquisition as fully completed including the expected divestment of the hotel operations to Scandic which is expected to be closed or be done in the second half of 2026. In the quarter, we recorded rent of 146 million kronor and net operating income of 138 million kronor, i.e. for the 54 days we had Dalata. In the quarter, we also recorded transaction costs of 241 million and preparatory financial costs of 22 million. Adjusted for these one-time costs, cash earnings amounted to 666 million in the fourth quarter. This corresponds to an increase of 23% year on year. We also report an acquisition result from the Dalata transaction amounting to approximately 1.6 billion. This includes the estimated remaining transaction cost of 340 million, which is expected to be done in 2026, and adding deferred tax of approximately 1.8 billion. This contributes to an increase in the EPRA NRV of 17.70 kronor per share or a total of 3.4 billion kronor. In the fourth quarter, we also started the work to separate the properties from the hotel operations, which is expected to be finalized in the second half of 2026. Financially, our financial key ratios now largely reflect all aspects of the transaction. Loan to value, excluding debt of some 504 million related to the expected sale of the hotel operating platform to Scandic, and including a and those bars ab's minority holding in bitcoin was 52.7 percent compared to 50.2 percent at the end of the third quarter on this page we summarize some basic facts on pandas we are active in europe the world's largest hotel and tourism market with strong structural growth drivers We only invest in hotel properties and create value through active and engaged ownership. We have a long-term revenue-based leases with a vault of 13.6 years and good guaranteed minimum rent levels with skilled operators. Please note that the reported vault is excluding the expected new revenue-based leases with Scandic for the Dalarta portfolio and will thus increase. Our property portfolio has an average valuation yield of 6.37% and a strong yield spread of close to 250 basis points. We systematically invest in climate change projects in our portfolio with good returns based on our science-based targets, validated science-based targets. And we have strong cash flow and a balanced financial position, which enable us to drive continuous profitable growth through acquisitions of new properties and investments in our existing portfolio over time. We have strong and well diversified hotel property portfolio, now consisting of 193 hotel properties with approximately 43,000 rooms in 11 countries and 90 cities. And with a property market value of approximately 92 billion krona. And the blended average yield of 6.37. And please note that the yield increase compared with the third quarter is all explained by the Dallata properties going into our portfolio. at a higher average yield. We are divided into two mutually supportive and reinforcing business segments. Leases and own operations. Leases where we own and lease out our hotel properties stands for 84% of the property market value. In our own operations, we transform and run hotels in properties we own. Own operations make up for 16% of a property market value. And our focus is upper mid-market hotels with mostly domestic demand, which is still the backbone of the hotel market, regardless of which phase the hotel market cycle is in. We have also one of the strongest network of brands and partners in the hotel property industry. And this ensures efficient operations and revenue management, which maximize cashflow and property values and a continuous flow of business opportunities. And also relative large part of the investment in leases is shared with the tenant, which lowers our risk. And later in this presentation, I will share some data on what the portfolio will look like after the acquisition of Alata. Here we have a breakdown of the performance for a selection of countries and regions and cities versus 2024. We show daily rate, average daily rate on the vertical axis and occupancy on the horizontal axis. In the boxes, we indicate how much higher or lower REVPAR is compared with the corresponding period 2024. In 2025, Revpar growth was mixed across the markets. Occupancy was stable or growing in most markets, while average price was more varied. In terms of Revpar, the greatest relative improvements during the year took place in the Nordic markets, with Norway as the leader, Denmark performing consistently well, and Sweden ending the year on a positive note. Oslo and Copenhagen were strong city markets throughout the year. Many markets ended the year strongly, with Germany and especially Frankfurt and Hannover as good examples. Anifa Roche from SDR and Rasmus Kjellman from Benchmark Alliance will talk more about this, the underlying trends in the hotel market later in this call. At every point in time, we have our projects rolling, big and small. The projects vary from high yielding investments, like adding more rooms in an existing hotel, converting non-yielding spaces into guest rooms, for instance, cabin rooms, or adding more beds into existing rooms. To more bread and butter investments like product uplifts and rooms slash bathroom renovations. In the leases business segment, we share the investment with our tenants and both parties enjoy the upside potential and share the risk. In own operations business segment, we take the whole investment in our own books, but also have more control and can enjoy the full cash flow. And on this slide, you can see some examples of our bigger ongoing projects. Every year, we invest approximately one billion kronor into our existing portfolio. And now with the acquisition of Dallata completed, this figure is growing a bit, mainly during the next two years, due to especially two large projects from the Dallata portfolio. One conversion from an office into a hotel in city center Edinburgh, and one large extension of 115 rooms in Clayton Cardiff Lane in Dublin. Both are exciting, high yielding investments that we expect to be finalized in 2026 and 2027. Here we have a selection of some of the upgraded products that were done during 2025. Many of these already giving impact in 2025, but more so for the full year of 2026. Add to that our pipeline of approved investments for ongoing and future projects of around 2.6 billion, out of which 1.6 is expected to be completed during 2026. So a good pipeline of both upgrades or products, as well as expected to add more than 550 new rooms during 2026 and 2027. Here we have summarized key financial effects from the Dallata transaction. And yes, it is a nightmare slide, but still useful to explain the complexity of this transaction. This acquisition was closed 7th November, 2025. And we report the transaction as fully completed, including the expected divestment to Scandic. I will not go through all these lines, but the effects in Q4 2025 are in short. 31 plus 1 investment properties, some 16.9 billion was added. The properties were externally appraised in the fourth quarter. Rent and NOI of 146 and 138 million kronor respectively for 54 days in business area leases Transaction cost of 241 million kronor was expensed. Preparatory financial cost of 22 million, i.e. for the period before the 7th of November. And an acquisition result of 1.6 billion, which includes 340 million in expected sale cost for the expected sale of the hotel operating platform to Scandi. This means in principle that we do not expect any additional transaction costs on top of what has already been recorded, unless we identify new areas of consideration. The deferred tax liability of 1.8 billion kronor arising from temporary differences between fair value and taxable value for investment properties, loan to value, there we exclude the debt of approximately 500 million for the expected sale of a hotel operating platform to Scandic and include A&O Spar AB's minority holding in VidGo. We are currently working full speed with the separation of properties and hotel operations, which we expect to be completed in the second half of 2026. As we have said previously, there are several ways to think about this transaction from a value perspective. The main value driver is of course that we add 31 plus 1 investment properties of high quality in high REV4 markets with solid profitability and cash flow generation capacity together with a strong operating partner. We also unlock value from acquiring Dalarta at an unattractive price, and in turn, an implied value of the properties, which is lower than their worth according to Pandoc's business model. Our tentative estimate of this value uplift or expressed slightly different embedded value was some 3 billion kroner, or actually 3.4 billion kroner as the increase in EPR and NAV of 17.7 kroner per share. Accounting-wise, this is expressed as an acquisition result of approximately 1.6 billion, together with a deferred tax of 1.8 billion amount to this EPA-NRV uplift. And please note again, this also includes the estimated remaining transaction cost of some 340 million. Here we have mapped out the 31 investment properties from Zalata that we already added to the leases in the fourth quarter. And apologies in advance if some of the cities have been marked out wrongly. 21 of the properties are located in Ireland and 10 in the UK. Dublin and London are the biggest cities markets with 11 and five hotel properties respectively. All hotels are well established with leading commercial positions in the markets. This is what our portfolio in the UK and Ireland looks like, including Dalata. In total, we now have 63 hotels, of which 12 in Dublin and 11 in London. In number of rooms, in our total portfolio, the UK now accounts for 20% and Ireland 12%. We thus increase our exposure to Ireland in particular, but also to the UK market. And in terms of destinations, our exposure will increase towards international destination and decrease towards regional destinations, relatively speaking. Here we have mapped our now 12 properties in Dublin with a total of some 3,200 rooms, including some... Prime assets like our 608 room Clayton, 57 rooms Clayton Hotel Leppardstown, 334 rooms Clayton Hotel Ballsbridge, and not the least 304 rooms Clayton Hotel Cardiff Lane, where we also have an extension project for 150 new rooms expected to be completed in the end of 2027. Here on this page, we have three out of five new London hotels, 227-room Clayton Hotel, Chiswick, 212-room Clayton Hotel, City of London, and 191-room Malden Hotel, Finsbury Park. And on this page, the remaining two properties added Maldon Hotel Shortage and Clayton Hotel London Wall. In total, we now have 11 properties in London for a total of some 2,400 rooms. Here we have a quick summary of the main changes in the portfolio measured in number of rooms. Primarily in relative terms, set our international exposure increases as a consequence of more rooms in international cities, notably Dublin, London and Edinburgh. The share of revenues leases with minimum guaranteed rent also increases, which adds to the earnings quality of our portfolio. With that, I hand over to Anneli Lindbom, our CFO. Thank you, Lia.

Good morning. In the port quarter, revenue and group net operating income increased by 9% and 22%, respectively, driven by the acquisition and overall strong life-for-life growth. Like for like, leases reported growth of 5% in both revenue and net operating income, while own operations reported revenue and net operating income growth of 5% and 24% respectively. Adjusted for non-recurring items of 263 million, where 241 is transaction cost and 22 is financial cost related to the acquisition of the data. Adjusted for those cash earnings and profit before changes in value increased by 23 and 35% respectively. When it comes to currency, Please note that to reduce the currency exposure for an investment, our aim is to finance the investment in local currency. Equity is normally not hedged as Pandoc's strategy is to have a long investment perspective. Currency exposure are largely in form of currency translation effects. In the fourth quarter, currency had a negative impact on both earnings and property values. And as you know, we have the main part of our hotel properties outside Sweden and denominated in foreign currencies. And now even a larger part due to the acquisition of the Lotta. On this slide, we show the change in the main valuation parameters for the total property portfolio year to date. And please remember that investment properties are recognized at fair value. According to IFRS, unrealized changes in value for operating properties are only reported for information purpose, but it is included in the EFRA NRV. For the year, the total unrealized changes in value were positive 117 million driven by low yields. As I said earlier, changes in currency had a negative impact on the balance sheet items for the period. They decline in property value of minus 4.6 billion in the period. And as you know, on the 7th of November we closed the acquisition of Dalata Hotel Group with the purchase value corresponding to 15 billion kronor on which some 16.9 billion in property value is added here. End of period, the average valuation yield for investment properties increased by 19 basis points. to 6.28%, reflecting the higher yields on the Dalata portfolio. For operating properties, it's increased by one basis point to 6.85%. So the blended yield for the group increased 13 basis points to 6.37%. So, here we have the average yield, the average interest on debt and EFRA NRV per share quarterly. And the yield spread is intact. And in the period growth in EFRA NRV was a positive 7.7% measured on an annual basis and adjusted for paid dividends. Our LTV at the end of the quarter amounted to 52.7%. And the debt related to the expected divestment of Balata's hotel operation to Scandic is included. and that item is reported as liability held for sale. The minority interesting on Enbom Spar's ownership in our bidding company is included, however. As you can see, we are still well within the range. The ICR on a rolling 12-month basis was 2.6 times. Adjusted for preparatory financial cost of 57 million, the ICR was 2.7 times. Cash and credit facilities amounted to 1.7 billion, including credit approval of new financing of 1.5 million in the first quarter 2026. The liquidity reserve amounted to 3.2 billion. And on top of that, we still have unencumbered assets with a value of some 900 million as an untapped reserve. So during the quarter, the constructive trend in our financing market continued. In the fourth quarter, we took up new and refinanced existing loans of 13.8 billion, which makes it close to 21 billion for the full year. Looking ahead, we have 5.8 billion of debt maturing within one year. And our bank relations are strong and expanding across our markets. We have ongoing and positive discussions on future financing and refinancing. And there is really a strong appetite among not only the Nordic banks to finance our hotels. So we have a wider group of banks that are very interested. At the moment, 51% of the net debt is hedged. This is the lowest level since the end of 2022. And with that, I hand over back to Lia.