Storytel AB (publ)

Good morning and welcome everyone. I'm Bård-Ledersson Torp, the CEO of Storytel Group and together with me here today is of course our Group CFO, Stefan Ward. We are happy to deliver record strong Q4 and full year for Storytel with good financial and operational performances across both our streaming and publishing segments. We conclude 2025 with record high profitability and a strong cashflow generation. And we can say that we are in a good shape to continue our progress in 2026. So here comes some of our strong highlights. for 2025 and Q4. Our Q4 highlights includes continuous strong top-line growth with improved profitability and a strong cash flow generation. Our streaming business delivered subscriber growth of 9%, reaching 2.7 million paying subscribers at the end of 2025. Our subscriber growth was strong across all our core markets in Q4 and also for the full year 2025. And the churn continued lower throughout the whole year, while ARPU levels in local markets remained stable. And this is, of course, a good indicator of the value that we bring to our book lovers. Our publishing business continued to deliver very good performance as well, with external revenue growth of 18% in constant currency, also with high expanding profitability. In publishing, we had a strong list of new releases, also in Q4, such as, for example, the August prize winner and the best-selling title, Vitran, with Bea Usma. And we have also today announced that we during Q4 started the process to transfer our listing to Nasdaq in Stockholm market, main market. And it's expected to be complete in 2026. So now over to our financial performance in the quarter. We delivered sales growth of 12% in constant currencies and EBITDA growth of 15% in the quarter. Our gross margin was at the new all-time high level, while our EBITDA margin was at the 20% level for a second quarter in a row. So our net profit of 300 million was boosted also by a one-off positive tax impact of 195 million. And Stefan will come back and talk a little bit more about assets as well. Cash flow was solid and we ended the year with a net cash position. So we are very satisfied with the performance in Q4. We continue to see improved internal efficiencies. While at the same time, our product development has been intensified during the year. So this is also more that will come, I would say. We crossed 4 billion in sales for the full year 2025. Our full year EBITDA grew by an impressive 26% in 2025 over 2024. Our EBITDA margin for the year reached 18.8%. This is keeping us well on track to meet our midterm 2028 targets, as we announced last year at CMB in May. So over to you Stefan and the numbers of our two business segments.

Thank you, Bodil. We had another solid quarter in our streaming business, adding close to 50,000 new paying subscribers during the quarter and well over 200,000 for the full year. In the Nordics, we added 16,000 in Q4 and 57,000 in 2025. So a relatively strong intake in the Nordics where we have a good or high market share position. In Sweden, we had positive intake both in Q4 and for the full year. Outside the Nordics, we added 32,000 subs during the quarter and 152,000 during 2025. Our strongest market in terms of net intake was Poland. with a total increase of over 50 000 for the full year other markets with strong subscriber growth include the bulgaria the netherlands turkey and germany at the end of q4 our nordic and non-nordic subscriber bases were roughly evenly split at 1.34 million each As a consequence, we continue to see a decline in the average ARPU, as our Nordic ARPU is typically higher than ARPU levels outside the Nordics. This trend will continue. However, it is important to note that the ARPU levels in local markets remain stable to positive in constant currencies. Over the past few years, we have seen a significant decrease in churn levels, and churn continues to move lower also in 2025, ending the year at the new all time low level. Looking at streaming financial, we delivered sales growth of 10% in constant currencies and 5% in reported. Streaming gross margin was 43.6% while the EBITDA margin was 15.3% for a total EBITDA growth of 8% year on year. Our EBIT in streaming improved by 21%. We're on track to cross 1 billion in quarterly revenues from streaming during the second half of 2026. In our publishing segment, we delivered another strong quarter with 11% year-on-year revenue growth and external publishing revenue growth of 21%. Publishing EBITDA margin expanded to 32.2%, enabling EBITDA growth of 19% year-on-year, while EBIT grew by 20%. Storyside is our in-house publisher that has been fundamental for us to build and develop the audiobook market both in the Nordics and throughout most of our non-Nordic footprint. It remains the biggest profit engine of our publishers and had a very good year. Other publishers that delivered strong results during the year are Linden Co., Norstedts and Bokfabriken. Bookfabriken was acquired early in 2025 and has rapidly improved to become one of the key profit contributors in our publishing business. It has exceeded our expectations for 2025 and prospects are promising also for next year. In terms of cash flow, it remained strong both in Q4 and for the full year. Cash flow from operations before changes in working capital in Q4 was 217 million, up 10% on a comparable basis. That means adjusting for the copy suite amount of 34 million that was included in Q4 last year. Cash flow from operations for the full year amounted to 647 million, up 26% year on year. We had some tailwind from working capital in the quarter, but it was less than anticipated. The reason for this is that we have tied up a little bit of unnecessary working capital during the year and had a negative impact from working capital of 75 million. These are due to some... unfortunate internal issues that has been resolved so our best estimate for working capital development in 2026 is to have a neutral impact for the full year cash flow from investing activities was 55 million in the quarter and 252 million for the full year of which 160 million relates to capex Cash flow from financing was minus 12 in the quarter and minus 235 for the full year, including debt repayments of 100 million and last year's dividend of one krona per share of close to 100 million. On the next slide, we can see the balance sheet. And in here, you can both have a look at the cash and equivalents position of 686 million. that we had at the end of the year. You can also see that we have recognized the deferred tax asset of 195 million relating to previously unrecognized tax losses carried forward. This is now deemed as highly probable to be able to utilize and therefore moved on the balance sheet included in the non-current financial assets. We concluded our refinance agreement in January, where for our interest-bearing debt of 550 million was by year end, it was moved from non-current liabilities to current. But as we have concluded the refinancing early this year, it will be moved back to non-current in the Q1 results. Our equity to assets ratio continues to improve and is currently at 53%. On the next slide, we can see our net debt position was 136 million at the end of the year. The strengthening of our balance sheet reflected the new terms of our financing. It provides us with plenty of flexibility to pursue both organic and M&A growth strategies going forward. In addition to strong operating profitability, we also expect to see lower cost of financing and for the tax rate to remain low for the next several years. With that, I hand back to Bodie.

Thank you, Stefan. And to deliver strong financial performance, we need to also deliver strong customer value. And I just would like to take some minutes to highlight what's going on during 2025 where we have increased our efforts for increased customer experience. We have a market-leading position across most of the markets in our footprint, and we are proud of that. And our strategy to defend that is the position that we have built for our two pillars, a world-class user experience and the strongest content catalog. We cater our book-lover segment where reading books is a natural part of daily lives. So since I joined in October 2024, reigniting our industry leading product expertise has been moved up to the top of our strategic agenda during last year and it will stay there. We will be in the front of the evolution of book consumption across all formats. And over the past year, last year, we launched several strong new features. And I will also highlight that there is more to come here. We will continue to intensify our investments in the local relevant content, but also, of course, in the user experience. That is extremely important for us. so that will continue to improve both engagement and satisfaction for our book lovers of today and tomorrow that is building our resilience so one of the most common specific feature that has been requested from our customer is actually sync listening and reading This enabling our users to read along as they are listening or just jump between read and listening. And that's a fantastic feature that many of our customer loves. Sync listening is currently enabled on almost 50,000 books in our catalog. And this is expanding as we speak. Another feature is story art recently launched that shows art pictures connected to a specific timeline in the book. Story art with all the visuals now becomes a natural part of the listening experience optimized in the player. This adds a new immersive layer to the story, driving engagement again and connection with the story. So pilots are launched with Pottermore, Harry Potter in Netherlands, and we have also launched it together with Bia Usmans, title that that also was the swedish august price winner last year so this is very exciting and here we will soon see many more titles coming up also in the children's segments i will say where we see that where we have some demands uh the sleep timer is also very uh Yeah, it's a function that really many of our users use every night. It's used by 300,000 users every night. And we recently launched sleep timer recaps. where we use generative AI to reach the rewind options and to enable a better recap and understanding of the story. Also, when you fell asleep and fall asleep and you don't really know where did you lost the story. So it's easier for you to actually find where you were sleeping in the story. So it's easier to recap and follow up where you start to listen again. This is some of our new features and with this, it's important for us to highlight that we have more exciting features to come in pipeline and this is a strategic important objective for us to increase our customer experience in the player. And over to the last slide here to recap our messages for Q4. We have delivered on our 2025 targets with record profitability and strong cash flow generation, making this a successful year. Our streaming subscribers hit 2.67 million with churn rates consistently moving lower, while ARPU levels remain stable in local currencies. Our publishing segment delivered record external revenue growth, cash flow generation continues to increase, and we closed the year with a net cash position. We remain on track to reach our 2028 mid-term targets. Our firm targets for this year, 2026, is to deliver at least 870 million in EBITDA. We also propose a dividend of SEC 150 up from one krona last year. We see room to increase our dividend by a similar amount also in 2027 and 2028. We are ready to take our business to the next level and one step is also to change listening to the main market in 2026. So with this, I would say, stay tuned. And now we're ready to take your answers. No, to take your questions so we can answer your questions. So please go ahead.