Vimian Group AB (publ)

Good morning, everyone, and welcome to Vimian's first quarter earnings call 2026. I'm Olle Taibach, Group CEO, and I will present the first quarter results together with our CFO, Carly Wansetterberg-Boudry. Q1 is always an active period for us at Vimian, with strong cadence of industry and client events. This provides an early read on customer sentiment, I get valuable feedback across our beef businesses, opportunities to engage with industry peers and so on. It's encouraging to see that the strong traffic booth, high engagement and the positive feedback I get from veterinarians from these events are also reflected in a strong start to the year with positive momentum across the group. Three out of four of our segments, specialty pharma, veterinary services and diagnostic, all deliver double-digit growth in the quarter, well ahead of global animal health market. We completed two acquisitions in the quarter, the diagnostic company Ivet in Italy and the innovative Danish clinic group Fauna. These two acquisitions will add in total around 10 million euros in annual revenues. This morning we also signed the acquisition of veterinary service business Vetsafe with revenues of 1.6 million euros. This marks the entrance into Ireland for our veterinary service segment. Our M&A pipeline going into 2026 is fruitful and we have a strong position as a natural home for ambitious entrepreneurs within animal health. Operational cash conversion remains strong in the quarter being above 70%. And on April 13th, we welcome Lutta Lundås, Tartun as head of Medtech, adding vast experiences running entrepreneurial businesses based out of the US. Turning into the quarterly numbers, we report 8% revenue growth and reached 116 million euros in revenues for the first quarter. We delivered strong organic growth of 9% ahead of the market driven by specialty pharma, veterinary services and diagnostics. 4% contribution from acquisitions and 5% negative impact from currency movements. Adjusted EBITDA grew 3% to 29.2 million euros or 8% adjusted for negative currency impact. Margin of 25.2%. given our plan investments to Diagrowth Kinetic and Orthopedics and new market entries within veterinary services. Going into specialty pharma, specialty pharma delivers a strong quarter across the board with double digit growth, improved profitability and strong cash generation. The organic growth of 10% was driven by double digit growth in three therapeutic areas, while the strongest contributions came from allergy and specialized nutrition, where growth was supported by key customer wins in the past months. We continued to execute our strategy of innovation, education and cross-sales and launched 17 new products and four new cross-sales initiatives in the quarter. We established a direct sales force in Switzerland and Finland and started to cross-sell our compounded pharmaceutical products in Scandinavia. Adjusted EBITDA grew 11% to 14.4 million euros or 15% adjusted for negative currency impact. Margin improvements improved significantly from 28.8 to 30.3% driven by operating leverage across the businesses. Moving on to Medtech, in Medtech we delivered 6% organic growth driven by double digit growth in our dental business and in our orthopedic businesses in Europe and APAC, where all markets deliver healthy growth. of our European orthopedic markets delivered all time high quarter and continue to strengthen our sales team and education teams in the region. In US orthopedics, we onboarded our new field sales force with a lot of focus on getting them ready and training and continue to drive sequential sales improvement in a challenging market. We attended several key congresses in the quarter, and continue to see our high-quality orthopedic brands enjoy a strong reputation in the global veterinary community. As previously communicated, we expect changes we have implemented in orthopedics to enable US orthopedics to return to organic growth later in spring. Adjusted EBITDA declined 2% to 11.9 million euros, or grew 6% adjusted for negative currency impact. The adjusted EBITDA margin was 27.1%, which is a strong sequential improvement driven by very strong performance in our belt of businesses in the quarter. Year over year, margin was impacted by geographic mix and our investments into orthopedics to strengthen commercial performance in particularly in the US where we are seeing effects of those investments. Two weeks ago, Lotta Lundås joined us as head of METRIC as well, and we have already felt the energy and experience she brings into the organization from building and scaling entrepreneurial organization, strong financial track record. Overall, being close to the method business up until Lotta joined us, I'm confident that we are on the right track to get our method business, and in particular, the US orthopedic business back on track. And we have the right people to continue strengthening commercial performance across the board. Before I move on to veterinary services, I would like to spend a few minutes using or highlighting the Medtech dental operation as a clear example of how we at VBM create global opportunities, combining M&A experience or expertise with operational excellence to build global living platforms and long-term shareholder value. In October 24, as you all know, Vinyan acquired IM3, making our entry into the veterinary dental niche. The companion animal dental market is both large and attractive, growing above industry average, and clinicians believe that this will be the fastest growing category at the veterinary clinic in the coming years. 80% of cats and dogs are affected by dental diseases, which makes the unmet need significant. At the same time, there's a clear structural gap. Dentistry typically receives only scarce attention in vet schools, and many clinics still offer limited dental services, despite strong clinical need and revenue potential. But growth in the segment is further driven by humanization of PET and increased demand from veterinarians to continue education in dentistry. For Vimya, bringing a successful entrepreneurial and fast-growing global platform like iM3, offering a wide range of services such as equipment, imaging, consumables, home care and software, allows us to create new touch points for us and gives us attractive growth opportunities. So looking at those growth opportunities or those new touch points, This can, for example, include targeted bolt-on acquisitions, such as we did with Dental Focus, deepening our U.S. imaging capabilities, and a la San Rosano's to expand our geographic reach and broaden the portfolio, taking a proven and innovative dental seeding product from one market, expanding it to the rest of the world. as well as doing strategic M&A or strategic investments or transformational investments like the acquisition of David AI, which leverages technology to improve workflow and embedding dental education into clinical routine. The more clinics continue to expand into dental services and deepen their knowledge of dental, our average revenue to clinic also increases given the broad range of services we offer within dental. While we currently remain in the early stages of this growth journey, I'm pleased to see the development we've had in the business post-acquisitions and some of the initiatives we've done since. Since IM3 joined us, we've established a multi-channel sales team, we've strengthened our consumable offering and loan subscription models, driving recurring revenues at good margins. We invested in a new warehouse facility, to facilitate growth and launched our first US-based education center. We launched a new successful dental unit called the Evolution Range. And on the back of the David AI acquisition, we launched a proprietary AI power imaging software systems. We are also clearly exploring cross-sales opportunities with the broader MedTech segment and have set up joint education initiatives or activities and shared facilities for orthopedics and dentistry. Since the acquisition, our dental platform has delivered double-digit revenue growth with expanding margins, and we are optimistic about the organic and main opportunities we have ahead in this space. Continuing to veterinary services, our globally leading veterinary service platform continues to show strength and again delivers double-digit organic growth, being 11% in the quarter. with continued momentum in member growth and conversion into higher tiers under now Michael's leadership. At the end of the quarter, we reached 11,400 members across four continents, and then adjusted EBITDA grew 3% to 4.8 million euros, with an adjusted EBITDA margin of 27.5%, given the strategic growth investments and temporary lower margins in some of the co-owned clinics. The demand of our services from both veterinarians and partners increases every day. And with today's development of AI, we see our ability to develop new and enhanced existing services to our customers at a faster pace than before. Last year, we shared that on the back of the successes we've had with the veterinary services, we were also planning to do additional investments, as you've seen in the numbers this quarter. by expanding into new markets and new services. Therefore, I would like to give some more insights into some of those market expansion investments. Firstly, we have since the second half of 2025 prepared our organic expansion into two new markets. One being Japan, unlocking a large market for veterinary services following the successful METIC launch Japan. In Japan, probably it's around, it's a top 10 market when it comes to animal health, depending on which numbers you look at, you could argue it's probably the fifth or sixth biggest market as well. And there's approximately 10,000 clinics in the Japanese market. And we expect to launch our Japanese operations in Q3, but we already have people on the ground as of today preparing for that launch in the market. We're also preparing to do adjacent market expansion by going into Portugal. We've had a very successful growth and momentum in our Spanish operations, so we see Portugal as a natural add-on to our Iberian footprint, leveraging the existing team we have in the territory and adding local skill sets and excellence. The Portuguese market has approximately 1,500 clinics, and we expect to launch in Q3 as well. Beyond our organic expansions, the team always looks into finding relevant companies in other markets to acquire, and we're very happy that this morning we signed an agreement to acquire VetSafe, the leading veterinary service organization on the Irish market. The Irish market has approximately 700 clinics, and VetSafe have approximately 150 clinics currently working together with them. This deal is expected to be completed in May. So on the back of these three initiatives, combination of organic and M&A, which is how we operate, we are now taking our veterinary service platform from 11 to 14 markets globally, unlocking long-term growth, and additional scale benefits. Moving on to diagnostic, diagnostic delivered double digit growth of 12% in the quarter, positively impacted by disease outbreaks towards the end of the quarter, mainly from the avian influenza outbreak in the US and blue tongue in Europe. On March 2nd, we consolidated the diagnostic business IVET, an important milestone to strengthen our companion animal offering and onboarding a strong entrepreneur and a strong team to our diagnostic team. Adjusted EBITDA grew 16% to 1 million euros and the adjusted EBITDA margin declines likely to 13.8% driven by product mix with higher level of extraction sales in the US. Looking ahead, we're excited about the opportunities to further strengthen our position in the attractive companion AMLO diagnostic market. From an M&A perspective, we covered that in the segment sections, but we've made three acquisitions here today and are advancing our M&A pipeline across the segments. We're very optimistic about looking at the pipeline we've generated and created and entered with it during 2026. And we truly feel that we are the natural home for entrepreneurial business leaders in the animal health sector. From a sustainability perspective, we continue to deliver our sustainability agenda in the quarter. On March 19th, we released our first CSRD compliant report. In February, we completed our biannual employee experience survey with high participation rate and further strengthening the employee experience scores. In March, we also completed our fourth cohort of Vimeo leadership development programs. In total, over 80 of our leaders have gone through one of these programs to develop and get to know colleagues across the world. In one of our largest production facilities in Italy, we installed solar panels during the quarter, covering the majority of the site's electricity needs and strengthening our resilience against grid volatility and rising energy costs. With that, that concludes the run-through of the quarter, and I will hand over to Kalle who wants deeper insights into the financials.

Thank you, Olli, and good morning, everyone. I'll dive straight into the results for the quarter. Adjusted EBITDA in the first quarter was 29.2 million euros, an increase of 3%. In constant currency, the increase corresponds to 8%. The adjusted EBITDA margin for the quarter equaled 25.2%, where the margin decrease compared to the same period last year is primarily a result of focused investments in medtech orthopedics to strengthen our commercial platform, as well as investments in new markets and services in our segment veterinary services. Central costs amounted to minus 2.9 million, an increase from minus 2.3 million last year. The increase is mainly a result of expenses related to our long-term incentive programs. In total, 0.6 million euro in the quarter. These are non-cash IFRS expenses that would recur for the duration of the three-year programs. We report an operating profit of 21.2 million euro, a significant 36% increase from last year's result of 15.6 million. Items affecting comparability decreased in a quarter compared to the same period last year and totaled minus 1.8 million euros. The majority of items affecting comparability relate to MedTech. This consists of minus 0.7 million in litigation costs in the US indemnification dispute and 0.5 million in acquisition costs. Acquisition related costs amounted to 1.1 million in total for the group. Net financial items amounted to minus 3.3 million euro and consisted of four main parts. Financing expenses of minus 3.1 million with an average interest rate of 4.1% during the quarter. A quarterly discounting impact of minus 1.3 million and positive impact of 0.2 million from probability adjustments related to contingent considerations. A positive impact of 0.9 million from exchange rate effects on the revaluation of debt. And lastly, The quarter was also burdened by a write-down of shares in associates amounting to minus 2.5 million. Income tax expense for the quarter was minus 5.3 million euro at an effective tax rate of 35%. In the quarter, the tax expense as percentage of pre-tax profit was negatively affected by the non-deductible write-down of the shares in associates together with other non-deductible expenses. In total, this results in a profit for the period of 10.1 million euro with an earnings per share of 2 euro cents for the quarter. Looking at the cash flow, the cash flow from operating activities amounted to 23.0 million, corresponding to a cash conversion of 73% for the first quarter. Cash conversion being measured as operating cash flow in relation to EBITDA. Networking capital amounted to 92.8 million euro at the end of the quarter, equal to 21% of revenue. a decrease from 96.6 million at the end of the fourth quarter, which equaled 23% of revenue. The majority of the 3.8 million decrease in working capital is relating to an increase in payables. Cash flow from investing activities amounted to minus 33.6 million, primarily consisting of acquisitions and earn-out payments. And cash flow from financing activities of 5.1 million euro from proceeds from borrowings. At the end of the quarter, net debt amounted to 258.4 million, up from 245.4 million at the end of the fourth quarter. Cash and cash equivalents amounted to 50.4 million, a decrease compared to 55.0 million at the end of December. External lending was 230.2 million at the end of the first quarter. This resulted in a leverage at the end of the quarter equal to 2.1x, which is an increase from 2.0x at the end of the fourth quarter, where we still remain well capitalized with an ability to execute and strengthen acquisition pipeline. With this financial review, I hand the word back to Ali for concluding remarks.

Thank you, Kaliwan. Vimeo is off to a good start to the year with double digit growth in three out of four segments and strong cash generation. We welcome three new businesses year to date and remain positive about the M&A opportunities throughout 2026 and beyond. All in all, we are well positioned with a robust strategy and continue to execute our organic and inorganic growth initiatives to build a global leader in attractive animal health niches. Thank you for your attention, and we now open up for Q&A.