Vimian Group AB (publ)

Welcome to the Vimean Group Q4 Report 2025 presentation. During the Q&A session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to the speakers, CEO Alireza Tajbash and CFO Carl Johan Zetterberg-Boudry. Please go ahead.

Good morning, everyone, and welcome to Vimean's 2025 year-end and fourth quarter earnings call. I'm Olli Taibach, the new group CEO since the end of last year after leading the veterinary service segment for the past four years. To give you some background, during my four years as head of veterinary services, the business developed from a northern European purchasing organization into a global service platform with over 10,000 member clinics. I personally experienced Vimyans ability to attract talent and entrepreneurs and take something relatively small with potential and build it into global scale and a market leader. I'm a firm believer in our strategy of organic and acquisition driven growth, and we operate in an exciting and resilient industry going through change. I know the sector, the customers, the business and our organization well, and I'm confident about our industry and Vimyans future. We will now go through Vimyon's full year and fourth quarter, and Karl-Johan will later give you deeper insights into the financials. Looking back at full year 2025, Vimyon delivered revenue growth of 13% and adjusted beta growth of 11%. We saw broad-based growth across most of our businesses, not least in specialty pharma, veterinary services, and our med-tech dental businesses. We also put in focused efforts to address the headwinds within medtech orthopedics, in particular in the US. In fall, we received a positive judgment in the US indemnification process, and all counterparts have now, as per year end, paid us in full share. The year also delivered a strong operational cash flow of 105.7 million euros, corresponding to a cash conversion of 101%. Last but not least, we also completed the list change to NASDAQ main market, where we are now a large cap company. Going deeper into Q4 and looking at the quarter, we delivered a solid finish to 2025 with 6% organic growth and 6% adjusted EBITDA growth. Excluding currency effects, it adjusted EBITDA growth by 12%. We saw continued momentum within our specialty pharma segment. We saw strong finish with medtech dental, while active measures were taken in the quarter within medtech orthopedics. Veterinary services continued to perform at scale, reaching over 10,000 members. And in the quarter, we increased our M&A activity with three acquisitions across three different segments and expanded our M&A pipeline the past few months ahead of 2026. IVET, an important milestone for a diagnostic segment, was signed just before Christmas and is an acquisition to strengthen the companion animal offering within that segment. The quarter also delivered strong cash conversions. Looking at Q4, we had 4% revenue growth to 109 million euros. Our organic revenue growth was 6% driven by specialty pharma, veterinary services and our med tech dental business. 3% contributions from acquisition and we saw 4% negative impact from currency movements, in particular the movements within US dollars. We improved our margin by 60 basis points versus Q4 2024, driven by Bolton acquisitions and delivered 6% adjusted EBITDA growth for the quarter. And as I said before, excluding currency effects, adjusted EBITDA growth was 12%. Looking at specialty pharma, we continue to see positive performance in the fourth quarter with 6% organic growth following an exceptionally strong Q4 24, where we reported 22% organic growth. Normalizing the positive effects from the national sales campaign in the US in the fourth quarter 2024, the underlying organic growth was double digit in the fourth quarter this year. All four therapeutic areas delivered growth in the quarter, with the strongest contribution from our dermatology portfolio. Overall, organic growth continues to be driven by our innovation, cross-sales activities and veterinary education. Adjustability grew 4% or 7% adjusting for currency effects to 13.8 million euros, which is an all-time high quarter for us. The margin improved from 29.4% to 30% driven by revenue growth at stronger gross margin. For the full year, Specialty Pharma grew 6% to 182.4 million and adjusted the beta by 10% to 53.9 million. In January, our head of Specialty Pharma, Magnus, announced his departure after 10 years in the company. I believe the business stands strong and the recruitment process for success is ongoing. And we've secured a strong transition plan with Carl Johan as interim head of specialty pharma. As interim head of MedTech since end of July, I'm happy to see the accelerated momentum in our dental business in the quarter, as well as early operational improvements within our orthopedic business, although we still have work to be done and the market remains soft. In total, we delivered 4% organic growth in the fourth quarter, supported by strong growth in our dental business and orthopedics in Europe and APAC. Within Orthopedics, we have implemented a reorganization in the quarter with focus on strengthening commercial performance. We built out our field sales organization in the U.S., and we reviewed and rationalized our product portfolio where we had over 22,000 SQs and have decided to discontinue over 4,000 overlapping SQs. We are still in transition phase in U.S. Orthopedics during the initial period of 2026. We continue to drive sequential sales improvements, but do not expect orthopedics to deliver year-on-year growth until later in spring. The recruitment for a permanent head of method is ongoing and progressing well. The margin in the quarter of 24.6% is a 370 basis point improvement versus Q4-24, mainly driven by the consolidation of Bolton acquisition within Dentistry in 2025. Adjusted to beta grew 23% in the quarter and 32% excluding currency effects. For the full year, Medtech grew revenues by 25% to 155.5 million euros, where our acquisitions within dentistry contributed 30%. Full year adjusted to beta grew 15% to 39.6 million euros. Veterinary services deliver another strong quarter with 10% organic growth. In October, we completed the acquisition of a local service platform in Belgium with 300 member clinics and passed the 10,000 milestone when it comes to member clinics, closing the year with 10,900 member clinics. As previously communicated, we are accelerating our investments into new geographies and services in the quarter, taking the margin to 26.6%. For the full year, veterinary service increased revenues by 11% to 64.3 million euros and an adjusted EBITDA growth of 9% to 18.4 million euros. Michael Tonell, who has been part of Veterinary Services since 2018, was appointed head of Veterinary Services when I became CEO. And I'm pleased to see how the team has come together and continue to build momentum as the global leading veterinary service platform. Our diagnostic business reported 5% organic growth in the quarter and a margin of 9.2%, reflecting our investments in new products and personnel to strengthen the companion animal offering. The growth was supported by blue-tongue outbreaks in Europe and avian influenza globally. For the full year, diagnostic grew by 9% to 22.9 million euros, while adjusted data declined 3% to 2.2 million euros. As I said initially, we welcomed five new businesses in 2025 that expanded our portfolio and geographic footprint. We've seen improving M&A momentum towards the end of the year with three out of these five acquisitions coming in the fourth quarter. We've built a stronger pipeline over the past months and I'm optimistic about the M&A opportunities going into 2026. We continue to focus on successful entrepreneurial-led businesses that can grow and reach their full potential faster as part of Vimyam. A good example of that is IVET that we signed in December. IVET is one of the top three in companion animal diagnostics in Italy and forms an important addition to our diagnostic segment. IVET is a typical Vivian acquisition, high growth, successful and entrepreneurial-led business, where the entrepreneur Daniele is highly motivated and will continue to lead the business as part of Vivian. Annual revenues of 5.6 million euros, where two-thirds of the revenues comes from laboratory services, where they have three ref labs in Italy, and the remaining third is from sales and in-clinic diagnostic tests. IVET also has a well-known educational platform with over 100 courses annually and offer residency program in partnership with universities. Looking at our sustainability, as we now close 2025, we can see that we continue to make important progress within our ESG agenda. Our sustainability agenda is closely integrated into the core of the business and focuses on animals, our people and the planet. During 2025, we educated 65,000 veterinary professionals to improve animal health and we launched 94 new products to advance veterinary medicine. Our employee net promoted score reached 30 and we have exceptionally high scores from our teams in areas of inclusion, trust and autonomy. On the environmental side, we continue to reduce our emissions in total with 25% since 2022. We also received external recognition for our work with an improved rating at both MSCI to AA and Sustainalytics for low risk. That run-through of the year and the quarter, I will now hand over to Kali Wang.

Thank you, Ali. And let me give you some further insights to the financials for the fourth quarter and full year. Adjusted EBITDA in the fourth quarter was 26.1 million euros, an increase of 6%. This represents a margin of 24.0% for the quarter. The margin increase is primarily an effect of consolidation of bolt-on acquisitions within Medtech dentistry during 2025. Also, our largest segments, especially pharma, contributed to the margin expansion supported by operation leverage in the business. We report an operating profit of 19.2 million euro, a significant 54% increase from last year's result of 12.5 million. Items affecting comparability decreased in the quarter and totaled minus 0.7 million euro. The majority of items affecting comparability is relating to Medtech. This consists of minus 1.6 million euro in restructuring costs from organizational changes and inventory write-down as a consequence of the product portfolio rationalization, as well as 2.7 million relating to payments net of litigation costs in the U.S. indemnification dispute. Acquisition-related costs amounted to 1.1 million in total for the group. Net financial items amounted to minus 7.5 million euro and consists of four main parts. Financing expenses of minus 4.1 million with an average interest rate of 4.5% during the quarter. A quarterly discounting impact of minus 1.6 million and a negative impact of minus 3.1 million from probability adjustments related to contingent considerations. The probability adjustments primarily relates to stronger performance in our acquired dental businesses. A negative result of 0.7 million from liquidation and divestments of subsidiaries. And lastly, a positive impact of 2.2 million from exchange rate effects on the revaluation of debt. Income tax expense for the quarter was €0.8 million with an effective positive tax rate of 7%. In the fourth quarter, the tax expense as percentage of pre-tax profit was positively affected by recognition of deferred tax on tax losses carried forward at year-end amounting to €3.7 million. The effective tax rate was inflated by non-deductible expenses, mainly probability adjustments of contingent liabilities. In total, this results in a profit for the period of 12.2 million euro, with an earnings per share of 2 euro cents for the quarter. Cash flow from operating activities reached 55.7 million, including payment from US indemnification dispute of 28.7 million in the quarter. Excluding the litigation payment, cash conversion was 92% for the fourth quarter. Networking capital amounted to 96.6 million euro at the end of the quarter, equal to 23% of revenue. a decrease from 102.2 million at the end of the third quarter, which equaled 24% of revenue. The majority of the 5.6 million decrease in working capital relates to lower current receivables and increase in trade payables. Cash flow from investing activities amounted to minus 17.5 million, primarily relating to acquisitions, earn out payments and investments in tangible and intangible assets. Cash flow from financing activities on minus 35.5 million Euro from repayment of borrowings. At the end of the quarter, net debt amounted to 245.4 million, which is down from 253.5 million at the end of the third quarter. Cash and cash equivalents amounted to 55.0 million, an increase compared to 51.3 million at the end of September. External lending was 223.3 million at the end of the fourth quarter. This resulted in a leverage at the end of the quarter equal to 2.0x, which is down from 2.1 at the end of the third quarter. And we remain well capitalized with an ability to execute on our strength and acquisition pipeline. With this financial review, I hand the word back to Ali for concluding remarks.