Troax Group AB (publ)

Hi everyone and welcome to the third quarter interim report for Trovax Group. My name is Martin Nyström and together with Anders Eklöf, our CFO, we will present the numbers and key events for the third quarter. After the presentation we will open up for a Q&A session which I will lead. So let's dive into the quarterly numbers. If I start with the third quarter, I'd say that we were offered a mixed market development and we had some mixed outcomes. In total, we reported a minus seven order intake growth. But this is distributed very differently. So if we start with the big exclamation point, APAC continued very strongly in the quarter. I think it was also very good to see a broad-based and significant growth in all the countries. So I think this is a good sign and also a good sign of the value proposition that we have also in the Asian markets. If I look at Europe, we continued largely as we did in the second quarter. Overall, I'd consider this to be relatively slow and also the long expected recoveries, we're still waiting for that to see a broad-based recovery. However, I'd say there are some positive signs during the quarter in Europe. We did see a gradual comeback or recovery for the warehousing segment, and this segment has been fairly or very slow for quite some time. So I do think there are some positive good signs in this segment. This is also our largest segment in exposure in Europe. The counter side of this is that we have seen the demand in the automotive side decline a bit. And here I'd also like to note that we're meeting very strong comparables from last year. But we do see the automotive sector being somewhat slower in the third quarter in Europe. We continue to experience a slow market in the construction, in the Nordic construction environment. So all in all, it means that we had a declining order intake in Europe. On this, I would also like to point out that in the numbers for the third quarter, we also have a negative one-off effect due to the cut-off effects that we get when we now start to transfer the Polish factory and close that down and we're moving that to Sweden. So there is an impact on the order intake side from this. Last, but also not least, in Americas, we continue to see a decline. And I think here we do see pretty high activity. The quoting activity is very high, but the customers still hesitate to make decisions. And this is then driving the decline in the order intake in the quarter. If I move over to profitability, we have in the quarter, we have low volumes compared to what we have installed capacity for. We were also impacted by the production transfer in Europe. And in the quarter, we also had some operational challenges and issues in the US, which lowers the profitability. And we reported 16.1 as EBIT A margin. If we dive into the margin a little bit more, I'd say that the gross profit overall is on an acceptable level. We did have the volume drop, factory transfer, and of course, the operational challenges in North America. If we try to dissect this margin a bit more, the temporary effect from the factory move from Poland to Sweden, it diluted the EBITDA by roughly 100 bps. And in the US, due to the hesitancy in the market, we also have, we have struggled a bit with the pricing implementation during the quarter. So in total, this diluted the EBITDA margin by 100 bps as well. Here, I'd say we have taken good measures during the quarter going into the fourth quarter. So from an activity point of view, I do think we have taken action. Last but not least, supporting the margin is the cost reduction program that we launched in the second quarter, and this is delivering well and as planned. And we do see underlying that the sales and admin costs are starting to come down. During the quarter, we also delivered a strong cash flow, so 12.6 million euros or a cash conversion of 122%. We continue with good discipline in terms of inventory management. how we collect our accounts receivables and also how we pay our suppliers in our accounts payable and this means that our balance sheet continues to to enable investments both organic ones as well as as acquisitive ones in the quarter i'd also say that we've done solid progress on the several of our strategic priorities and i will come back to that a little bit later during the call as well as during the capital markets day next week So if we then move into how the markets are moving, so all in all, we reported a minus seven percent decline on order intake. If I start with the geographical perspective, first in North Europe, we reported a minus seven. Here I'd say all segments but the warehousing segment are down. Automotive has been down. Construction continues. down process others and the whole North European market was down in the quarter. Here I'd say the promising sign is that we now start to see the warehousing market waking up and also that we start to see that activity moving into order and order intake during the third quarter. So that makes me cautiously positive about 26, the fourth quarter as well as 26. Moving over to Southern Europe, where we reported a minus four on order intake. Here we also see decline in the automotive and warehousing sectors. But here there is also a good development on the process side. And process is one of the areas where we do think we can gain share and grow in the coming years. So from that point of view, I do think it's good to see process growing in the quarter. I'd say the big disappointment from our point of view is the development in Americas. We reported minus 26 during the third quarter. Here we'd say that all the big segments for us are down. So automotive is down, warehousing is down, and others is down. So here we see a lot of activity and deals not being lost, but it's been very difficult for us to convert this into orders. Then last but not least, we have our APEC region, which was up 66%. So we had a very good development during the first half of the year overall, and this continued into the third quarter. Here I'd say that all segments and all countries are growing nicely, and we have a lot of green arrows here on the bottom. So good to see the development and the continued growth in APEC. And with that, I'll leave that over to you, Anders, for some more digging into the financial numbers.

Thank you very much, Martin. I start with the order intake development. We reached 62.2 million in order intake for the third quarter to be compared with 67.0 million in the third quarter of last year. decline in seven percent of which six percent is organic and another percentage point come from from negative effects going over to the sales side and here we reached 64.2 million in sales to be compared with 69.0 million in the third quarter of last year this corresponds to a minus seven percent in sales Also here, 6% organically and another percentage point comes from FX. Moving over to the profitability side, we reached 10.3 million in EBITDA for the third quarter of this year to be compared with 13.6 million in the third quarter of last year. The EBITDA margin for this quarter was 16.1 to be compared with prior years, 19.7%. You can see here on the arrow side that we are trending upwards compared to the two first quarters of 2025.

Next one. Cash conversion was good in the third quarter.