Swedencare AB (publ)

Hi, and welcome to the presentation of SwedenCare's Healthier Report, led by our CEO Håkan Lagerberg and CFO Jenny Graflind. We will have a Q&A session after the presentation, so please raise your hand if you have any questions and we will answer them in the end. Jenny and Håkan, the stage is yours.

Hello and good morning. Here's Håkan Lagerberg and Jenny Graflind, and we will present the Q2 2023 highlights. Sales record and 9% organic growth. Yes, we have, as we predicted, had a strong Q2 when it comes to sales. Both the quarter and the month of June was actually our strongest quarter of months ever. We see continued strong growth in pet retail and online, and a bit softer veterinary sales. For the ones of you that follow the market, several veterinarian companies have released numbers and expectations that the 2023 year is a bit softer. But for us, we definitely see a change of... of interest and also, which I will present a bit further down in presentation, we have started to deliver on our major agreements with MWI and Pedersen. So half year two will definitely be stronger for us when it comes to the Vetner channel. And we are also, when it comes to the contract manufacturing side, we see increased orders for the second half year. So I do think that also the veterinary sector as a whole will be stronger second half year than the first. Our organic growth, 9%, almost 10%. So we're on track, not where we really want to be. And my expectations for the second half year is definitely stronger, both the Q2 Last year was a very strong quarter for us, and also when it comes to the situation with the destocking, that has definitely come to an end with this quarter. So I expect that all our major entities will have organic growth next quarter and going forward. This quarter, we still had a couple of entities with a minus in growth. Lower margin and strong cash flow. Jenny will explain the reason for the lower margins and the cash flow continues to be strong. And we focus on that a lot, of course, since we are very dedicated to keep on paying down our debts that we have. And also that we have, we made last year, we made lots of, let's say, investment, both in organization processes and also some CapEx that affected our cash flow last year. The big event in Q2 was perhaps the CMI's public mandatory tender offer. That offer has ended today and we will communicate when we get the information of how many shares was accepted to the offer, we will communicate that, but as I wrote in the report and also the board has communicated previously, is that myself and all other major shareholders that I know have not accepted the offer and we continue to work very well together with Simrise to grow the company going forward. We made one small acquisition in the quarter, a concept with called VetBiosDirect. I wouldn't say not unique, but for us a very interesting concept where we have agreements with individual clinics or animal hospitals or groups of... with a subscription model. So the individual claims pay a monthly subscription model and in return they will get special prices for lots of interesting products that we have, both under a completely unique brand called Gentoo, but also some of our other group brands are offered in this concept. So it's a very new way of thinking and also an attractive way for clinics to be able to get some sort of rebate on the bulk products that they sell in high volumes. So we started last year and we acquired the company this quarter and now we have a bit over 600 clinics subscribing and it grows a lot every month, I would say. Our sustainability work continues, and the highlight for the quarter was definitely for the first time we made a group employee survey. I'm very glad to be able to announce that we had excellent results with happy and motivated employees all over the world. And we will work with all of the results where there needs improvement. We will definitely do that.

But overall, very good results for all of the group companies and as a group in total.