SkiStar AB

ask a question during the session, you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 and 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speakers today, Stefan Jostrand, CEO, and Sarah Ginnert-Uggelberg, CFO. Please go ahead.

Thank you, Sharon, and nice to have you all here for the SkiStar Q3 presentation. It will be myself, Stefan Sjöstrand, and our CFO, Sara Ginrot-Uggelberg, who will make the presentation today. And the agenda for today is actually that I will take you through a brief introduction with 10 slides, roughly, and then we will take you through the Q3 highlights. and also with some numbers and then after that we will guide you through some outlook and how it looks forward for the upcoming next winter season as well as this summer season. So if I start with a short introduction and there will be some of the slides some of you have seen before but it's more to make a short introduction like I said. First of all, I'm truly happy to have this 50-year love story of SkiStar as a company. We have celebrated this 2025 and we will continue to celebrate in the beginning of next winter season as well. And the true anniversary is October 9th. So it will be really positive to continue this 50-year celebration with a lot of activities together with our guests and customers Our position is that we have a very strong position. We are the leading holiday organization for Scandinavia and What's very important for us is that we would like to create the memorable mountain experience all year round for our customers and we are really try hard for that and You will see later on what we have done this season to really make sure that this happened throughout the whole season Again, we are one of the largest players in the world and it's interesting to see that Sälen, what many think is a small destination, but it's actually the 16th largest destination in the world. And the ski store have three destinations in this top actually of the top 50 list in the world, which is amazing. Then if you look in and zoom into Scandinavia, we are the top leading company. We have five ski destinations, winter destinations in the top five. And we have not updated the numbers for this winter season since we are waiting for the rest of the market. So in Q4, you will see the full updated numbers for how it has looked this winter season. But again, I'm really glad that we will continue to work with our framework and the strategic framework where we will focus on mountain operations and the property development and Sara will also take you through how our development have looked through the both sides of mountain operations and the property development also from the past seven years. If we look into our integrated business model this is one of our really strengths within SkiStar and We are really glad to have close to 40 million visits to skistar.com where the customer come in and they book their holidays and they also book all the activities and this is something unique with our business model that we can continue to work with skistar.com as our distribution channel and our own OTA which is of course very important. We have our financial targets and they consist of 6% growth, 18% margin. We have a net debt EBITDA 2.5 and dividend up to between 40 and 60%. So no changes there. The same with our sustainability targets. We really would like to continue to focus on creating activity and recreation by adding more customers for skier and activity days. We continue hard to work with the climate reduction and also to work with different type of collaborations to continue to both work with the climate reduction and activate more people in our resource. What's very important for us to work with the strategic initiatives to reach our financial targets. They are really the five strong from and to and this development of the all year round operations continues and the same as we strengthening the margin and growth. We continue to increase the number of commercial beds both build new ones and also take in new ones in our booking systems. We continue to work with the sustainable future mountain experience as well normalize investments over time So with these five strategic initiatives, I will start to focus on the Q3 summary. So if we look into the report, some of you have read it this morning. And of course, we can clearly see that our sales and profit declined. And it declined due to the late Easter. And from God Friday, we could have really make... Yeah, it happened with really... poor weather conditions, and it starts to become really, really warm at our ski star destinations, mainly in Sälen and Trysil, later on also in Vemdalen. Åre maintained quite good as well as Hemsedal, but the 3-1 in the beginning had really tough weather conditions. And week 17, normally we have closed in Sälen and Trysil week 17. This year we have decided to have it open due to spring holidays or eastern holidays in the north part of Sweden. And unfortunately, we need to open up for the snow guarantee at the three destinations, Sälen, Trysil and Vemdalen. And what was very interesting was that media made a big thing out of this. And also media were announcing that this cost us a fortune out of money. However, we really like to make underlining that this week 17 was not the main reason or there's no guarantee or that we did not pay out money to our guests for canceling the bookings. What really happened was that due to the weather effect in week 16 and over Eastern, guests didn't decide to come to the Scandinavian mountains. They decided to stay at home. That's the pure reason, actually. And those guests who stayed at our destination, I must say the co-workers or staff we have, they made so much impressive work to make good conditions for our guests. They worked day and night. They closed some slopes and they shuffled the snow to the slopes where we had opened to really make as good experience as possible for our guests. So hat off again to all our employees making this happen actually. Then another highlight in the Q3 was that we have refines. We have made some refinancing with improved commercial terms and limits. We have added 700 million SEC, which is, of course, very strong and in connection to our debt situation. So I will come into that later. But 1.15, we are in a very strong financial situation going forward as well. During the quarter, we have sold a piece of land, Vasaköl, to Skiab. We also have made a long-term lease agreement with Skiab to rent that back. That will be 600 new beds coming up for the season 26-27. Then we also made a very important agreement with the landowner, Utmarkslaget. Utmarkslaget owns all land in Trysil. And previously, Utmarkslaget has been the one that developed the land and we have leased the ski part. But now we have actually made an agreement with them that we will, together with them, develop more property development within Trysil, which is completely new. So we will start up with the area around the gondola in Trysil, which is the AAA land around this gondola leaf. So a very positive agreement with the landowner Utmarkslaget. Then we have made an acquisition of Högfjells Hotellet's operation. We have been the owner of that building since many years back. But now, since May 1st, we take over the operation in Högis and Högfjells Hotellet. We are really glad that Folk & Försvar, the big conference in January, will continue to work with Ski Star also in January. really proud that we have made a collaboration together with seven other ski resorts for work with the sustainability part and we have called it global sustainability alliance and this will support also the development to put some pressure on our suppliers to really work hard on new development within the area of sustainability that could be of within the steel to have fossil free steels. It could be more electrical development and also even more snow efficiency production. So really glad that we could make this collaboration. Also, we have done an even long-term collaboration with SJ and Snälltåget. And that also means that customers can today book for winter season, the whole winter season next year. And that has not been possible before. And that will be very important, of course, but also something which has been a big requirement from our guests. Last but not least, OKQ8 have signed a strong partnership with us, and that means that we will, together with them, support each customer to fuel up with HVO. We will compensate the difference with normal diesel VS HVO to create a more sustainable travel to our destination. So I continue with some highlights of the Q3. Not only Q3, also the winter season, because now we can make a summary of that. And it is the second best result after the pandemic actually. And we make a very strong operational result. And I think pandemic was exceptional. And if we take that year out, we make the best year ever. The main reason for that is that we, of course, we lose some skier days due to this winter, sorry, the weather effect in the quarter three. But we open up with even more international guests. We increase 8% and they now consist of more than one third of our total number of guests. We can also see that we increased the ski school and ski school is important for the future and also all these international guests or most of the international guests actually buy the ski school as well. Retail or our ski shops continue to grow and our own brand equipped growth with 33% but also this retail area is now close to 700 million in second turnover which I think is quite important to look into as even more important part of our revenues going forward. Last but not least our co-workers are making a very strong work and our guests actually really like what they are doing and give them high scores nine out of ten actually like what our co-workers are doing in the job when they meet them every day. Just a summary of the winter season. I said it briefly. We lose in the end of the season. Easter didn't match up to the year before when the Easter was week 14 and 15. Now we only got some numbers in week 16 but it was unfortunately two low numbers. And what's really interesting is, again, the importance of the international guests. They drive average spend and they continue to do that. And that's why I'm also glad to later on talk about the new incoming flights to Salen Airport. The digital engagement continues and what we could see during this quarter was that we have even more digital engagement and that was a result actually of many customers actually looked at the weather because we show the weather forecast updating every day and also the number of lifts and slopes which was open. And unfortunately, that also led to less conversion. And now we also have made some updates in our MySkista members due to this GDPR. We decreased the numbers, but now we are starting to build it up again. And that's why we increased with 15%. And also, we are now up to 1.5 million members again then. And then we have a retail growth of the retail growth is continue, like I said, and we are growth and growth. And these business have really challenging times within. The area of sports, you have seen many challenges within the industry. For example, XXL have went into or close to bankruptcy and they have now had really tough times and lost a lot of money. But we can continue to show both growth and profitability within this segment, which is, of course, important going forward. So by that I hand over to you Sara who will talk a little bit about our numbers more in specific.

Thank you and if we take a look at the graph that shows the net sales development in comparison with last year and then you can see we've got a growth of 1.3 when you look at last 12 months number and obviously we had a very strong second quarter with a positive calendar effect. And the third quarter has been negatively impacted by late Easter and together with poor weather conditions. And that is obvious when you take a look at the revenue growth. The number of ski days was down 1.6, but still it amounts to 6 million, which is a fairly high number. The occupancy rate in accommodation was low It was 46%, which is down 3%. But if we take a look at the next winter season, the calendar effect will be very positive next year. And that is Christmas and also during Easter. And that will have a positive impact on the net sales. And we continue, as Stefan mentioned, to be an attractive choice for our international guests. that have increased by 8% and their average spending is high. And we have a lot of exciting investments for our guests that will be effective from next winter season. And the Nest Cell development per category. Obviously, and this is in comparison with last year, so the total period of September to May. And yes, we have an increase in ski passes that has a growth 3%, 3.2%, which is volume, but it's more price. And as I said, number of ski days is down 1.6%. Accommodation, the revenue growth is actually flat. Price is 4% and the number of objects is down 4%. We have, as Stefan mentioned as well, the retail segment has improved and increased, and that is both ski rental together with sports shops that add up to a positive impact on the sales development. When it comes to lodging, which is the sum of hotels and mediated accommodations, We've also seen that we have added capacity in restaurants, and that has also been a positive impact on net sales. Exportation is down, actually, because last year we had a lot of property transactions in Hemsedal, and that impacted net sales positively, but it actually had a negative impact on net gain last year. And others, which is up seven, it is actually events that has improved in comparison with last year. If we have a look at the operating profit per segment, then you can see that the development, and once again, this is the development from September to May, and operating of mountain ski resorts and operating hotels. the development is more or less flat. So the development or the upside comes from property development that was affected by a capital loss last year. And this year we've had a capital gain of 50. We have also had a positive impact from joint venture that has improved year on year. net sales and operating profit per business unit. It's more or less the same story but it's up 7% and it's a property development as I mentioned. It is also a ski path of course. It's lodging where restaurant drives as a new capacity drives the improvement. Support functions, which is down 18 million as the case, that is related to sales activities, but also IT. The seasonality impact, and this is more to describe that the seasonality impact is fairly high, and we do make money the second and the third quarter. we lose money in the first and the fourth quarter the seasonality impact is high within our operations. If we continue with operating profit development year on year then last 12 months graph shows that we should have in total 816 but that includes fairly high capital gain of 126 and that is related to last year. The capital gain remaining of this year will not be, that will be limited and the margin is 17.1 which is a fairly high number and underlying business, the operating business is 690 and And as Stefan mentioned, it is a fairly high number. It is the best result ever if we exclude the peak year, that was the year after the pandemic. So we have actually been able to double up our operating profit during the years.