Systemair AB (publ)

to everyone. We are in beautiful but crisp Stockholm here today, and we are here to report on the Q2 figures for today. As usual, you will find a presentation that we will run through here on our website under investor relations and presentations. I think it's pretty clear by now. And by that, I hand over to Roland to run through the presentation. Thank you very much, Anders.

And good morning to all you calling into our webcast here. So by that, let me directly move into our report and slide number one, just a little bit on the background of Systemair. As you know, we are founded in 1974 by our today chairman of the board, Jara Lengström. Our last fiscal year, we reported an annual turnover of 1.1 billion euros, and we're listed on the Nasdaq Nordic Stock Exchange market since October 2007. Today, we operate our own sales companies in 51 countries, We have 26 factories in 18 countries and around about 6,600 employees, and with their forces selling into 135 countries all over the world. Moving directly into the report and slide number three, net sales in this reported second quarter. The net sales in the second quarter amounted to 3.186 billion Swedish kronors compared to 3.03 the same quarter the year before. This is a growth of 4.9%, where of organic 5.1%. On the right side, you see the graph of the organic sales growth development. And having in mind that our historical development of the organic growth is somewhere between 4 and 8%. So we're back to the average continued organic growth. Moving to the next slide, slide number four. The growth analyzed for the second quarter. Organic growth we actually had in all regions except the Nordic region. There is a contribution by acquisitions, but the main impact here is, of course, the divestment of the air conditioning business, which contributes with negative 3.4%. And then we have the weakened Swedish kroners against both Euro, US dollar, and Canadian dollars, which contributes positively with 3.2%, which brings us in total up to 4.9% growth. Moving to slide number five, the adjusted operating profit for the second quarter. The gross margin improved to 33.9% compared to 33.3% the same quarter the year before, and the adjusted operating profit for the second quarter amounts to 322 million Swedish kroners compared to 288 the year before. The operating margin amounts to 10.1% versus 9.5%, having in mind that the previous year's operating profit included write-downs of our Russian operations in the amount of 168 million Swedish kronors. The sales and admin expenses in the quarter increased by 74.8 million on comparable units. So, as said, the second quarter operating profit amounted to 322 million Swedish kronors, which is 10.1%, compared to 288 million and 9.5%, the same quarter the year before. Moving to slide number six, the adjusted profit after tax for the second quarter. The net financial items for the second quarter amounted to 15.4 million Swedish kronors, whereof the currency effect on the long-term receivables, the loans and bank balances amounted to a net of 17.9 positive. The interest expenses for the quarter amounts to 32.2 million Swedish kronors. By that net, the financials The profit after tax for the second quarter amounts to 246 million Swedish kronors compared to 208 the same quarter the year before. Moving to slide number seven, looking into our cash flow analysis for the second quarter. The cash flow from our operating activities amount to 317 million Swedish kronors compared to 275 the year before. Change in working capital is positively 115.7 compared to negative 72 million Swedish kronor in the quarter the year before. This is mainly due to decreased inventories and increased operating payables. Our net investments, excluding acquisitions, are 84.8 million compared to 91 the year before. This is primarily machine investments in Canada and the ongoing building activities for the expansions in our factory in North America and Lithuania. So at the end then, by that, we have a free cash flow in the quarter of 347.9 million Swedish kronor compared to 111 the year before. And also to mention that our net debts today amount to 1.4 billion Swedish compared to 2.79, almost 2.8 billion Swedish kronor the same quarter the year before. Moving to the next slide, slide number eight, just giving you a high-level breakdown of our different markets and their developments. starting from the left, Eastern Europe and the CS countries. Here it looks stable, but I'll go a little bit more into depth later because it's very positive development. North America with a slight improvement from 11% to 12% of our total shares. Other markets have come back to that 14% positively. Western Europe with a slight increase to 46%, coming from 45%. And the Nordic region, as reported, with a slight decrease to 16%. Let's move into the details, and I'll start with the next slide, slide number nine, looking at the Nordic region. As stated in the report, sales in the Nordic region decreased during the second quarter by 3.2% compared to the previous year. And here I have to say that the Danish market showed a positive development during the quarter, while the turnover in the Swedish-Norwegian market decreased mainly due to the impact on the residentials. In Finland, the market was largely unchanged. Adjusted for those currency effects and acquisitions, sales decreased by 4.3% compared to the decrease of 9.3% in the first quarter. So again, growth 3.2% negatively, whereas organic negatively 4.3%. Coming to Western Europe in slide number 10. In Western Europe, the sales development continued to be good during the quarter, with an increase of 5.9% compared to the corresponding period last year. In particular, we have to say that UK, Spain, France, showed really good growth during the quarter, while the turnover in Germany and Italy decreased slightly. Sorry. Adjusted for the currency effect and acquisitions, sales increased by 3.4%, organic. Going to next slide, slide number 11, Eastern Europe and CS. And here it has to be pointed out that the growth within the region, excluding Russia, amounted to 30.7%. So some of the major markets within the region showed Continued good growth, such as especially Hungary, Slovenia, Poland, and Lithuania. Sales in total in Eastern Europe and the CF increased during the quarter by 22.2%. And here then, adjusted for the currency effect and acquisitions, sales increased by 23.2% organic. Next slide, slide number 12, North America. Sales in North America increased by 2.2% during the quarter compared to last year. And here it is, the Canadian market that shows good growth in the quarter, while the American market was more or less unchanged. Here, especially the commercial ventilation products and school ventilation products in North America, and of course more in Canada, is still growing stronger. Adjustment for the currency effect, sales increased by 1.7% organically. Next slide, which is slide number 13, and here we have then the Middle East, Asia, Australia, and Africa. Sales in this region increased by 2.2% compared to the same period last year. And here is especially India and the Middle East region that shows a really good growth during the period. Adjusted here for currency effects and acquisitions, sales increased by 12.2% in this region. Then looking in some of the projects as closing, as you saw, the Nordic region is declining mainly due to the residential part, but the other parts of our applications, like for example in this one, which is a hospital building in Norway that we're supplying to Narvik. It's really growing. So this new hospital in Narvik will bring together both physical and mental health services and substance abuse treatment in Thingy building. We have the honor to deliver 33 huge hygienic Genox air handler units, also the smoke extract trans and additional products for specific demand ventilation for this hospital. So the air units for this application will supply to all the areas of the hospital, including all the surgery rooms, pharmacy, patient wards, kitchen, and so on. So just to show that there is a lot of other investments ongoing in the Nordic region. Also in the Nordic region in Finland, we choose to show you this project, which is in Kokkola in Finland. And here is the nursing in Kokkola, west coast of Finland, that will be ready in autumn 2025. The really nice part here is this building complex won the year 2023's green forerunner competition, thanks to its outstanding green solutions and energy efficiency. And here we have been selected due to that the selection is based on the area of energy efficiency and quality, which of course are the key factors for decision-making for such a project. We will deliver here our Toppex air handling units together with 15 Genox units to ventilate this building as efficient as possible. And last but not least, on the next slide, slide number 16, again, another project in the southern part of Europe, also here a hospital application in Albacete, Spain, where Systemab will supply 63 hygienic genus air handling units to this hospital. The units will be installed in surgery rooms and common ward areas, and we will deliver those between December and May next year. And once this expansion and renovation of the hospital is done, The hospital will have almost 700 new beds and 29 new operating rooms. Also here to mention that the building will get the new B energy certification, which is the mandatory in compliance with technical building codes regarding energy saving and thermal insulation, which is new in Spain. By that I end and I hand over to the system and we open up for questions. Thank you very much.

We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. You will hear a tone to confirm that you have entered a queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Anyone with a question may press star and one at this time. Our first question comes from Adela Darshan from Jefferies. Please go ahead.