Volvo Car AB (publ.)

that's right multiple awards rolling in and we're ramping up the ex30 around the world we're going to speak a lot more about the car during this earnings call good morning and a warm welcome to the presentation of volvo car's first quarter financial results my name is ron and joining me this morning is our president and chief executive jim roman who joins us from our design studio in shanghai in fact jim is in china this week for the launch of the ex30 during the beijing auto show In the room with me is our Chief Financial Officer, Yuan Ekdal, and our Chief Commercial Officer, Bjorn Anval. At the top, Jim, Yuan, and Bjorn will walk us through our performance during the first quarter, and thereafter, we'll throw it open for a question and answer round. You can either participate using the chat windows that you should be able to see at the bottom of your screen, or you can simply use the phone lines. I'll come back with more information on how you can participate closer to the Q&A session, but for now, I leave the word to you, Jim.

Thanks, Ron. Delighted to be with everyone today and good morning. We started the year strong. Strong business performance with continued momentum to lay solid foundations. Double-digit retail sales growth during the quarter with the bulk of that growth coming in the back end of Q1 with March setting new monthly sales records of over 25% year-on-year growth. Solid core EBIT margins at 7.2% versus 6.1% this year. We improved the gross margins on fully electric cars, which came in at 16% versus 7% in Q1 2023. And the share of EVs and PHEVs came in at 41%, with EVs accounting for 21% of that. And the XC60 plug-in hybrid continues to be the most sold PHEV in Europe. We were the third largest EV brand in Europe. This is mainly on the back of the EX40 and the EC40 and of course the new EX30. And in fact, the EX30 was the third highest selling EV in March, having only started its retail journey. We started production and customer deliveries of the fully electric MPV, our new EM90 in China. Free cash flow stood at minus 12 billion sec, which is in line with their internal plans. This is affected by the EX30 inventory for that car and the inventory for our customers ahead. We secured shareholding support to distribute our 62.7% of our ownership in Polestar. And we continued to remain focused on cost and ensure robust capital allocation. If we look towards the financials, we reported solid financials for the quarter. Retail sales are up 12%. with most of that growth coming towards the end of the first quarter as we set new records in March and we ramp up the EX30. Revenues, slightly lower versus last year as a direct result of lower contract manufacturing. We'll speak to that in a little bit more detail very, very shortly. Our core EBIT margin improved to 7.2% from 6.6% year over year. This was due in part to the improved GOS margins, especially on BEVs and the result of our internal efficiency actions, especially on indirect costs. Cash flow for the quarter is down, but this is in accordance to our plan. We increased production and the build-up of the EX30 and inventory to meet the demand for that car. And Q1 is usually the low point for cash flows in our cycle, and it will improve in the coming quarters to remain on track for neutral cash flow in 2024. As we said previously, the EX30 is the smallest fully electric premium SUV, but with big potential. The Q1 performance showed the early prospects of this car, even though deliveries are still in the ramp-up phase. The car is a profitable growth driver for us as a business, with deliveries in Q1 already reaching 14,500 cars, and gross margins, as planned, between 15% and 20%. Thousands of customers across Europe are already behind the wheel of this car, with many more in line as it starts its ramp-up. And this will include customers in the US, China, South Korea, and Canada. And in the coming weeks and months, by the year ahead, we will have this car available in more than 90 countries across the world. I'm so pleased to share that the EX30 continues to win awards. This time, it's the 2024 Urban Car of the Year. and the Red Dot Best of the Best, two additional prestige awards that we've won. So in total, the EX30, since it was introduced, has received more than 20 awards, and we're still counting. Our balanced approach to hybrid and BEV has strengthened our portfolio. We continue to have high share of fully electric and plug-in hybrid sales, and this total reached 41%, with EV accounting for 21% of that. This performance on EV demonstrated that we are fully on track to reach our guidance of considerably higher EV share in 2024 versus 2023. Q1 was also an important quarter in terms of gross margins, with the fully electric car reaching 16%, up from 7% in Q1 last year, and from 13% in Q4 2023. This increase was led by the EX30, with gross margins of between 15% and 20%. but also we improved our margins on the EX40 and the EC40 due to lower material costs. Now we're taking a balanced approach on our products and the propulsion offerings. We have small SUVs, we have large SUVs, sedans, wagons, and MPVs, and that sets up nicely for growth in the premium end of the sector in over 90 countries. We have a balanced approach to propulsion, offering customers plug-in electric hybrids, mild hybrids, as well as fully electric cars. And we have focused on the premium segment. Apart from the EX30, the EM90 has already started production, and we've seen the first customers get behind the wheel of that car in China. The EX90 will start production in Charleston, in the USA, in the first half of this year. And each of these cars will be launched with new segments, which will strengthen our position in the premium electric segment around the world. And with that, I will hand over to Bjorn who will speak more about this balanced approach in our commercial operations.

Thank you, Jim. And clearly with a balanced car portfolio, we also have a balanced commercial approach. If you look at our geographical footprint to start with, it's a truly global and balanced situation where almost half of our sales is in Europe with another 20% each coming from China and from US and Canada. And a reminder, the 15% comes across Latin America, Asia Pacific, and Middle East Africa. So all in all, we're active across 90 countries. We also have a balanced setup in a backbone of physical retail partners that serve our customers across 2,200 retail locations for selling cars and 2,500 service locations for servicing cars. This physical backbone is then empowered through digitization to drive a great omnichannel experience, giving a good customer experience and taking costs out of the system for efficiency. Importantly, there are 10 million Volvos out there in the world today. That car park creates a good foundation for our continued growth. It has an immediate positive impact in that we, of course, sell parts and accessories and service to those Volvo lovers, but it also creates a good foundation for further growth. We will grow both by conquesting new customers, but also remaining the Volvo lovers out there. We need to retain them. This is a balanced approach. Out of the 10 million cars out there, we actually hit a landmark situation in March where we delivered now 1 million electrified cars, be it plug-in hybrid or bed. we have delivered 1 million electrified cars by March this year, which is also a good foundation for the future. Speaking about those electrified cars, you can see that across many markets in Latin America and Asia Pacific in particular, we are focusing almost fully on those cars. That might be a bit counterintuitive given that some of those markets are not very mature from an electrification standpoint for the total car market, but they were clearly right for premium electrification made by Volvo. This focus has propelled Volvo, Volvo's brand. We have increased market shares and earnings in those countries. We do that by being more distinct. It's right for sustainability, but it also gives a lot of simplification, both commercially and from an industrial point of view. This is a good way forward, and I think it's a testament to the fact that it's a big difference between electrifying the full car market and electrifying a part of the premium car market, which is Volvo's strategy. If you're a 1% premium brand that focuses on electrification, electrification is an upside, not a risk. If we turn over to the full electric cars, here we continue to grow. We grow with 27% year over year in quarter one. And now, as Jim said, 21% of all our deliveries are fully electric cars. And importantly, We're doing this with a value over volume mindset, and we have continued to deliver increasing margins on those cars and met the guidance we provided in terms of EX30 cars between 15 and 20% gross margin. So, our balanced car portfolio. On the plug-in hybrid and mild hybrid side, we continue to see solid demand, and with the love and tender we will give to those cars, We see this as a strong foundation and bridge towards the future where Volvo will be a full electric company after 2030. On the full electric side, as Jim already mentioned, EM90 is now starting to ship in China. EX90 will be produced in H1 and shipped in H2. And EX30 has really started off well. It hit a, I would say, inflection point in Europe where we started really to shipped to customers in March, and we shipped almost 8,000 cars in Europe in March. In Asia Pacific and Latam, that inflection point where we really ramp up deliveries will happen before summer in May, June. In US and Canada, it will happen after summer in September, October. And in China, after launching it in Beijing Auto Show this week, it will start to ship during the summer. So to sum up, we have a balanced car portfolio, we have a balanced commercial approach with a very clear future, premium electrification, but we have a very balanced approach of getting there. So with that, over to Johan Ekdal for a balanced review of our financial numbers. Johan.