Pandox AB (publ)

Thank you and good morning everyone on this beautiful summer's morning and to this presentation of Pandox Interim Report for the second quarter, 2026. As introduced, I'm on the Spare Head of IR at Pandox and I'm here together with Leono, our CEO, and Anneli Lindblom, our CFO. And today we also have the pleasure of having both Ifa Roche, Vice President at STR, and Henrik Karlsson from Benchmarking Alliance with us. and eFindHendrik will provide a shorter hotel market update on Europe and Nordics respectively after we have concluded the formal earnings presentation call. As you know, STR and Benchmarking Alliance are both leading independent research firms dedicated to the hotel market and the views they express are completely separate from Pandox. And we offer these presentations as a service to Pandox stakeholders. We start with Lia and Anneli's business update and financial highlights from the second quarter, followed by the Q&A session. So with that, I hand over to Lia. Please go ahead.

Thank you, Anders. And good morning and welcome, everyone. Despite significant geopolitical changes, the hotel market continued to grow during the second quarter and booking trends remain stable. For Tandox, total revenue and net operating income increased by 15% and 25% respectively, primarily driven by strong performance in the leases business segment, where the acquisition of Dalata contributed positively. At the same time, our hotel properties in Sweden, the UK and Germany outperformed their respective markets. Like for like, total revenues and total NOI grew with 3% respectively. Cash earnings per share increased by 15%, while EPRA-NRV per share with a dividend paid in April added back increased by 14% on an annual basis, demonstrating continued value creation for shareholders. The Dalata properties performed well during the quarter, generating a rental income of 312 million kronor with strong profitability. For the first half of the year, rental income from Dalata amounted to 533 million kronor. At the end of the second quarter, our loan-to-value ratio was 52.4% compared to 52.3% at the end of the first quarter. But adjusted for the dividend of 876 paid in April, the loan-to-value ratio was 51.4%. This reflects a well-positioned portfolio and strong cash flow generation, enabling us to reduce leverage relatively quickly. 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 long-term revenue-based leases with a vault of 13.4 years and good guaranteed minimum rent levels with skilled operators. Including the expected revenue-based leases with Scandic for the Dalato portfolio, the vault was 17.3 years. Our property portfolio has an average blended valuation yield of 6.36% and a yield spread of close to 240 basis points. We systematically invest in climate change projects in our portfolio with good returns based on SBTI validated targets. And we have a strong cash flow and a balanced financial position, which enables us to drive continuous profitable growth through acquisitions of new properties and investments in our existing portfolio over time. We have a strong and well-diversified hotel property portfolio consisting of 191 hotel properties with approximately 42,000 rooms in 11 countries and 90 cities, and with a property market value of approximately 95 billion krona. 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 our property market value. And in our own operations, we transform and run hotels in the properties we own. And own operations make up for some 16% of our property market value. The focus of our portfolio is in strong locations, mainly upper mid-market hotels with mostly domestic demand, which is the backbone of the hotel market, regardless of which phase the hotel market cycle is in. We also have one of the strongest networks 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 a relatively large part of the investment in leases is shared with the tenant, which lowers our risk. The Delata properties are performing well. In the second quarter, they generated a rental income of 312 million kronor with strong profitability. For the first half of the year, rental income from Dalata amounted to 533 million kronor. Assuming that the corresponding lease agreements had been in place during the comparative period, then the revenue growth for the Dalata portfolio in the second quarter is estimated at 4% in the UK and 3% in Ireland. And for the first half of the year, the equivalent growth is estimated at 2% in both markets. The performance is well in line with our expectations and confirms the quality of the acquired portfolio. The separation of Dalata's business into a property-owning business and a hotel operating business is progressing at full pace and is expected to be completed during the fourth quarter of 2026. Once the process is completed, Pandox will have an even stronger platform for long-term growth and value creation. In parallel, we are engaged in positive discussions with banks regarding the refinancing of the current acquisition financing for Dalata, replacing it with secured property financing. Indications are that this could be done at the substantially lower credit margin and that we most likely also can increase our liquidity reserve at that point. An important growth driver for us is the creation of new hotel rooms in existing Dalits. We have some 600 plus rooms coming out in 2026 and 2027, which will contribute to the organic growth for Pandox. Overall, the Darlata portfolio is young and strong. However, with the acquisition comes two large and exciting projects. Both are exciting plus 10% yield on cost projects. One is Clayton Cardiff Lane in Dublin city center, which is currently being extended with another 150 new rooms. And we estimate this project to be completed mid 27. Another exciting project is Clayton St. Andrew Square in city center Edinburgh. Here we are converting and extending a fantastic old office building into a new hotel with 172 new rooms. and we estimate this project to be finalized in the beginning of 2027 at the latest. Here we have a breakdown of the performance in the first six months of 2026 for a selection of countries, regions and cities versus the first six months of 2025. We show average daily rate on the vertical axis and occupancy on the horizontal axis. Thus, OREGO is the point corresponding to 2025 on both ADR, i.e. price and occupancy. In the boxes, we indicate how much higher or lower REVPAR is compared with the corresponding period 2025. And the circles here indicate the share of the property market values in each country that Poundox have. And please note that the market data is not available for June for countries and destinations outside the Nordics. So year-to-date January-June refers to the period January-May for these markets. Overall, we see stable performance across markets in terms of REVPAR. The best performing markets in the period were Denmark, Sweden and Ireland. Norway, which has been a very strong market in recent years, saw stable red part development at already high levels. The UK was slightly positive overall, driven by regional UK, while Germany had a slight negative red part development. Eva Roche from SCR and Henrik Karlsson from Benchmarking Alliance will shed more light on the underlying trends in the hotel market later in this call. Investments in our standing portfolio is an important part of our business model and, of course, capital allocation. At the moment, we have approximately 50 projects planned and ongoing in eight different countries. The total investment volume for these projects is approximately 4.2 billion, of which some 1.7 has already been spent. The stabilized target yield and cost on the total amount is approximately 9.5%. The estimated stabilized net operating income represents the additional or incremental annual NOI generated once these investments have reached their full potential, gradually and normally after two to four years. In 2026 and 2027, we have increased our planned investments mainly due to three large projects. the conversion of Clayton St Andrew Square in Edinburgh, and the extension of Clayton Cardiff Lane in Dublin mentioned before. And then of course, the extension of DoubleTree by Hilton in Brussels City. In these projects, we have already invested more than 900 million, basically with a zero return so far, since they have yet to be launched commercially. And as a final note, divestments are an important part in driving capital efficiency. And as we write in the report, we are opportunistically evaluating divestments in the Nordics. And with this, I hand over to Anna Liljendom, our CFO.

Thank you, Lea. And good morning, everyone. In the second quarter, total revenue and group net operating income increased by 15% and 25% respectively, driven by the acquisition of the data and overall positive like-for-like growth. Leases reported growth of 34% in revenue and 37% in net operating income. Like-for-like growth was 4% and 4% respectively. Apart from Balata, a positive relative performance in Sweden, in UK and in Germany was the main growth driver. Own operation reported lower revenue and NOI, mainly due to the divestment of two hotel properties and some negative currency effects. Like for like, revenue and revpar were unchanged. Underlying, we had some negative effects in Brussels in the quarter due to more supply, weaker meetings demand and some unfavorable calendar effects. Cash earnings grew 15% in the second quarter, reflecting the improved result and a bit lower cost for central administration. The decrease in central administration mainly driven by reversal of provisions related to long-term incentive programs. Central administration cost fluctuates a bit depending on what projects we are working with and also due to holiday season. But our normal run rate is usually around 60 million per quarter. On this slide, we show the change in the main valuation parameters for the total property portfolio year-to-date. And remember that investment properties are recognized at fair value. According to IFRS, unrealized changes in value for operating properties are reported for information purpose, but it is included in our APRA NAV calculation. For the period, the total unrealized changes in value were negative 54 million. We had a positive effect from lower gains in leases and a negative effect from both cash flows and gains in own operations. Property values benefited from a deprecation of the Swedish krona. End of period, the average valuation yield for investment properties with some rounding effects were largely unchanged at 6.29%. For operating properties, it was also largely unchanged at 6.78%. The blended yield edged down one percentage point to 60.36%. Here we have the average yield, the average interest on debt and EBITDA per share quarterly. The average interest on debt end of period increased slightly to 4.01% from 3.85% in the first quarter. And the yield spread narrowed slightly to some 240 basis points. And in the end of the period, EPR NAV had reached 234.15 SEK per share with a solid 13.7% growth adjusted for the paid dividend in 2026. Our LTV at the end of the quarter amounted to 52.4%. Excluding the paid dividend in April, LTV was at 51.4%. and we are well within our financial policy range on both numbers. The ICR on rolling 12-month basis was 2.4 times. adjusted for preparatory financing cost of 59 million, the ICR was 2.5 times. Cash and credit facilities amounted to 3.1 billion. And on top of that, we have unencumbered assets with a value of some 890 million as a sort of untapped reserve. The trend with good demand from banks and lower credit margins remains intact. We were very active on new financing and refinancing in the quarter. New loans and refinance amounted to 14 billion for the period. And at the end of the period, we have 8 billion on debt maturing within one year, including the acquisition facility related to the lockdown. The average interest on debt increased by 16 basis points to 4.1% in the second quarter compared with the first quarter. This is explained by a contractual margin increase on the acquisitions facility for Dalata. We also had some expiration of some favorable hedge contracts and a higher base rate primarily in euros. So we have positive discussions ongoing with Nordic and international banks for the refinancing of the acquisition facility. We will sort of finance it with traditional property backed bank financing. And that will of course be with a bit lower credit margins. We also hope to be able to increase our liquidity reserve at that point too. Bank appetite to finance our hotel properties remains strong. At the moment, 59% of the net debt is hedged, which is an increase compared with 55% in the first quarter. And with that, I will hand back to Lia.