VNV Global AB (publ)

Hi, all. Thank you for joining me in the Global's first quarter 2024 report conference call. On the call today, we have Per Billiard, CEO, Dennis Mohamed, who's part of our investment team, and myself, Björn von Silvers, CFO at the company. As per usual, Per will start with the summary of the quarter and some highlights from his management letter. And after this, we will open up for Q&A. As a reminder, if you want to ask a question, use the Q&A function here on Zoom, and we will try to address your questions towards them. With that short introduction, I'll hand it over to you, Per.

Thank you, Björn, and thanks, everyone, for joining. No, who is it? Dennis, you're doing the slides here. Yeah, so you've seen the reports. It's a slight uptick. We've left the sort of 666 number to a 667 number. It's a slight, slight uptick. We're rounding upwards, but it's an uptick, especially in Swedish crowns, 54 Swedish crowns in a bit, which is up from the end of December, which we're very happy about. But I'll just try to summarize the big things that are going on. uh and uh i think that's you can do that at the next slide um and um the big i think i so the big thing uh during this quarter uh the big thing for us in general right now is to to sell assets uh so that we can pay down the debts that we have and that as we've spoken about for a long time and you know all of you know that we we've had cash for some time now to pay down the June bond. And we've been repurchasing that June bond in the market. And during this quarter, we did sell a portfolio of assets centered around Booksy to Verdane for 52 million bucks. And then there's some earners that can take it up to 58 million bucks. And most of this is closed now. Very, very, very small piece. It's not closed because there's a longer closing period. But that's small. So most of it has closed. And that has allowed us to also start to retire, in essence, retire the debt that's falling due in January 2025. And we did like a structured, organized buyback of that. So we bought back 300 million Swedish and a bit. of those bonds in the market. And the rationale behind that is that simply the price we pay in the market gets us a yield to maturity that's higher than what we get at the bank. So it just makes sense. And we're basically still in the process of selling further assets to completely pay down the debt that matures Yeah, well, during the coming sort of six months, six to nine months, I guess, including the Jan 25 one. And so the current net debt position is 64 million bucks, which is down from 110 at the end of the year. So that's very much in focus. I think we can go back a slide, Dennis. Yeah, that one. Sorry. Yeah. So the transaction with the sale to Verdane, we sold for money now $52 million, something that we had booked at just under $60 million, as this shows. So that's a 12% discount if we get the earn out and we're bullish about that. It's basically no discount and obviously a much, much, much more discount than whatever we trade at. At the time that we announced this, we traded at just under 20. It's gone up a little bit since then, although we're still at a big discount. So thanks. Yeah, I just want to touch upon that. Now we can go back to the next slide, Dennis. Thank you. Other things then during the quarter is that uh, boy, which is a big holding of ours. Um, uh, the third largest now, um, because we've taken it down somewhat, uh, to reflect the value of the company, uh, in a capital rates that they just completed. Uh, so they raised 25 million bucks. Uh, we put in five, uh, this takes the company to cashflow positive, which, which is a very strong position to be in, uh, uh, these days. Um, and, um, Revenues over the past two years has grown 50%. They've reduced costs a lot. They've halved costs. And this has all sort of expedited them to become profitable. So there is, in essence, EBITDA positive last year. There, in essence, will be EBIT positive this year. So very much in the right direction. So we can talk more about this if anyone has any questions, but that's a big thing for us during the quarter to complete that. We're very happy with Voi. And I think as most of you who are based here in Europe, I mean, Voi is present in a hundred or so cities in Europe and the European market is really sort of narrowing down to two key players, which is Voi and Lime. Certainly those of you who are based here in Scandinavia see that those two operators are the ones that are still standing, offer a great product, and the people who've looked at this industry from a distance and seen that, oh boy, there's a lot of competition here, how can this ever make money, sort of sees now that it's fewer players, stronger players, on the license. And I think, I think people are starting to, and there will be more to come as these companies, you know, look back at profitability and has a history of profitability. It'll be clear that this is really, this is really key piece and not, not only a key piece in European cities, transportation networks, but also, you know, an important piece of logistical transportation. That's also potentially very profitable. So, other things is uh yeah um get as we mentioned here uh because it's in a messy part of the world uh and despite sort of the horrible violence that's going on in that region uh around the sort of economic centers of israel business is fairly if you can call it but at least in economic terms, fairly back to normal. And they rebounded to 95% of what we saw before October 7th, which is, of course, from an economic standpoint, very good. And they've also served, you know, Get has become the player at the Ben Gurion airport. That's the, you want to take a taxi from there, you use Get. It's sort of a big thing there. So probably not many of you have traveled there since October 7th, but it's working very, very well. So as hopefully things start to calm down there, that airport will be more and more busy, and that will be a big contributor to get going forward. So very happy about that. The other thing was BlaBlaCar. I think all of you saw we certainly sort of – helped spread it. They did a press release where they announced 100 million euro financing, which is something that they don't usually do. We are very happy that the company is starting to sort of share more news and information like the ones they did because it helps us give you guys an insight into the company that's unusual for private companies and it's probably more usual for companies that are that are on route to becoming public. Now, as all of you know, a blah, blah car has talked about going down the public route at some point in time. And, you know, from a distance, I think we can all say that this, them starting to do this kind of thing is a good precursor to something like that happening. the credit facilities to support them doing M&A. And we're very excited about M&A opportunities in this space. They also took the opportunity to sort of talk about their financials, announcing a 253 million euro in revenue, which is up some 30% year on year. And perhaps more importantly, that they are EBITDA positive and And in contrast to Voi, EBITDA is the level that matters here. There's nothing that happens below EBITDA in terms of assets to be depreciated or etc. So that's very strong. This company is doing super well. So that's like an overview of what we think of, you know, there's lots of stuff that's gone on at VMV over the quarter, but those will be the highlights, I think it's fair to say. And now Björn is going to take us through some more details in terms of the numbers. So over to you, Björn.

Thank you, Per. Yes, here we have a snapshot of the balance sheet for quarter ending. And we have an investment portfolio of some 60 crowns per share, additional cash and cash equivalents of 3.7 crowns per share. That gets us to a total investment portfolio, including cash of almost 64 crowns per share. On that, we have borrowings of negative dividends. nine crowns per share uh that gets us to the 54 first 54 crown nav roughly uh today that represents a discount or the share price today represent roughly this comes from 55 percent to that And as Per said, the NAV in SEK over the quarter was up roughly 6% and flat in dollar terms. If we move to the next slide, Dennis, I'll just note some highlights on the three largest assets and the movements of our cash and net debt during the quarter. Blablacar, our largest holding, was up roughly 9% during the quarter, primarily driven by slightly increased adjusted peer multiple and also slightly increased fully diluted ownership following the cancellation of certain employee incentive pools that no longer exist. The Blablacar position represents roughly 25 crowns per share, so around 45% of the NAV as per March 31st, so our largest holding by far. Again, get this down roughly 3% during the quarter, also driven primarily by a slightly lower peer multiple. Although the situation in the region remains volatile, we know that per mentioned, Gett have recovered now to 95% of pre-war levels. And by quarter ending, Gett represents roughly 7.6 crowns per share as of March 31st. Both BlaBla and Gett are valued on our typical or regular model. Boy, on the other hand, was moved the most during the quarter. It's down roughly 21% during the quarter. And that's essentially driven by the fact that we moved the valuation from previous model to now transaction. We invested $5 million as part of a $25 million new equity round and also converted our previously held convertible, which amounted to approximately $90 million, which gets us to the $24 million here in the table. Voi represents 6.5 pounds per share as of March 31st. In aggregate, these three largest holdings represent roughly 39 pounds per share and just about 70% of our NAV. During the quarter, we also closed, as Per mentioned, the Verdane portfolio transaction partially. We sold Booksy, James Edition, and Carla. Cash and cash equivalents at the end of the quarter was $46 million plus an additional $2 million in liquidity management investments. The driver of the movement in cash or non-movement in cash, if you will, was that total proceeds from sales that were primarily driven by this Verdane transaction. The partial close there had proceeds of sale of $50 million. And at the same time, we also repurchased bonds during the quarter to the order of 350 million crowns, which gives us this ending cash balance of $46 million. And given these movements, net debt, if you move to the next slide, Dennis, was down 2%. from roughly $110 million last quarter to $64 million now. Correspondingly, borrowing was down 152 to 110, driven by these repurchases and also some FX effects. With that, I'll hand it back to Per. We'll flick through some more slides before we go to Q&A.