Viva Wine Group AB

For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to CEO Emil Salnes and CFO Lynn Gavir. Please go ahead.

Good morning, everyone, and welcome to our Q3 2025 presentation. My name is Emil Salnes, and I will, together with our CFO, Lynn Gavir, present today. This is the agenda for today. And before we go into the quarterly update and financials, I want to start by giving you a short introduction to Viva Wine Group. Today, almost 90% of our business is in our B2B segment, which includes the Nordic monopoly markets, as well as retailers and restaurants in both the Nordics and Europe. With the acquisition of Delta Wines, our B2B business is now present in seven markets and operate through 12 companies. In the Nordic Monopoly market, we are the market leader in wine. With the acquisition of Delta Wines, we also entered the open market in Europe, and we are the leading wine distributor in the Netherlands. Just over 10% of our sales is in the B2C segment, which consists of our profitable e-commerce business based in Germany. We operate via our three platforms, Vecampo, Weinfjost, and Wine&Black, selling to 11 markets in Europe. And we are one of the leading online wine retailers in Europe. So now let's move on to the Q3 update and our performance summary. When summarizing the quarter, I'm very pleased to report that we delivered a strong third quarter. Net sales increased significantly by 49%, mainly driven by the acquisition of Delta wines. Organic growth was positive at 2.8%, with growth in both segment B2B and segment B2C. Adjusted EBITDA increased year on year as an effect of the consolidation of Delta wines, while the adjusted EBITDA margin was lower, which is a reflection of the lower margin profile of Delta. Since our last quarterly call, we have communicated that we are in the process of moving to the main list. For us, this is the next step in our growth journey and the natural progression after the IPO in 2021. Moving to the main market is a quality stamp and makes the share more attractive to investors. To align with the shareholding profile of mid-cap companies and to broaden the investor base, we also, in the end of the quarter, issued a limited distribution of shares. The issue was oversubscribed and we welcomed 3,500 new shareholders. We expect the change of listing venue to be finalized in the near future. Now, let's look in more detail at the financial performance. I will hand over the word to Lynn.

Thank you, Emil. We have a strong net sales growth of 49% in the quarter, mainly driven by the acquisition of Delta Wines. Organic growth was positive at 2.8% with growth in both segments, which reflects that we continue to have a solid underlying business. In our B2B segment, Delta Wine's performance and integration is going according to plan. The underlying Nordic business was also performing well and was slightly up in the quarter. B2C reported positive organic growth for the third quarter in a row and also continued to grow its customer base. Looking at the profitability, adjusted EBITDA increased versus previous year, mainly as an effect of the consolidation of Delta wines, but also excluding Delta wines, adjusted EBITDA increased versus prior year. The lower adjusted EBITDA margin is a result of the lower GM percentage in Delta wines. The adjusted EBITDA margin for the underlying business exceeded previous year's levels with improved gross margins. Over to the net working capital. Net working capital is according to plan and the ratio of net working capital to net sales is down to 12.9% from 14.5% in the last quarter. A high level simulation including net sales for 12 months shows that the ratio is slightly below numbers pre-acquisitions. Our net debt to EBITDA is also developing according to plan and is down from 4.1 in Q2 to 3.6. We expect to continue to deleverage as the EBITDA is consolidated month per month. A high-level simulation of adding 12 months of EBITDA reduced the number from 3.6 to approximately 3. We expect to continue to deliver and reach our financial targets of 2.5 during next year. Cash flow. We have a very strong cash flow from operating activities in the quarter, supported by an improvement in working capital. We have cash flow from investing activities that includes the business combination of Vinguide and Nordic, with a cash flow effect of 8 million Swedish crowns. Cash flow from our financing activities includes repayments of term loans according to plan and change in overdrafts. The cash flow from the previously mentioned distribution issue of shares will be reported in the cash flow in Q4.