Volati AB

Good morning, everyone, and welcome to today's presentation with Volati. With us presenting today, we have the CEO of Volati, Andrea Stenbäck, and CFO of Solix Group, Martin Hansson. We'll open up for a Q&A after the presentation, and you can either type in your questions using the form to the right, or if you're calling in and would like to ask a question, please press star nine to raise your hand and star six on mute when you get the word. And with that said, please go ahead with your presentation.

Thank you. And thank you everyone for listening to our quarterly presentation. Let's dig into it. So Velote, we're an acquisitive growing group of well-managed companies with strong earnings and cash flows. And today we consist of three business areas, but I'd rather talk about our six platforms. And our business model is to develop these platforms and build them independent and strong. Currently, we are evaluating a separate listing of the platform Solix, which is also our largest business area. I'm very happy to have the CEO of Solix Group, Martin Hansson, with me here today to tell you a bit more about Solix Group later on during the presentation. So let's get into the numbers. Our Q4, the sales came in in line with last year, and EBITDA increased with some 3% in the quarter. Saw lakes developed very strong, showing a growth in EBITDA of 74%. And I would say that Etiquetta had a stable development. In industry, I'll get into that a bit later on, we see a mixed development. Very strong operating cash flow, up 8% compared to last year. And the net debt to EBITDA ratio is now down at 2.5. So just concluding the full year then. We have seen sales increase of 7% and that's supported by Etiketto that grew close to 30%. Salix also had a strong growth of roughly 15% compared to last year. The growth we've seen is acquisition driven as the organic sales growth were flat over the year. However, that is quite a shift compared to the year before where we had a minus 7% organic sales growth. EBITDA growth came in 10%, of which 2% organically, much driven by Zollix, that grew almost 50%, of which half of that was organic. Earnings per share, a positive trend in that as well, up 14%. The overall market condition has stabilized since the bottom into 2024. I think that's very obvious when you look at the graph to the right of this slide. We do see signs of improvement. However, that differs between the platform, but SOLIX currently being the front runner and then markets in which we operate there. We expect that trend to continue or I expect that trend to continue. However, it's very hard to predict the pace of their recovery. As I said, we came out at 8.4 billion in sales and 726 in EBITDA. So that's where we are right now. I always say that Volati should be evaluated over time, and if we do that, we can see that we have managed to grow at an average yearly pace of 15% per year in EBITDA. However, since 2021, the yearly growth rate has been lower. What does that mean? That means that we have created a growth gap. The reason behind that is that the markets that we're operating in has had challenging conditions, but we need to close that growth gap. If I look into 2027 and where we have to be in order to achieve that, that should put us in a position where we have to show EBITDA of between 1.1 to 1.5 billion of EBITDA that year. So that is the challenge that we have ahead of us. Looking at the financial targets, EBITDA growth, 10%. So it's a positive trend compared to last year, but it's still under our financial goal of 15%. As we have operated under that goal for a couple of years now, that means that we need to surpass that and exceed that goal in the coming period. ROE, the return on equity, is almost there already now. I expect us to reach and exceed that goal shortly. And net debt to EBITDA is where I expect it to be. So with that, I thought we would go into describing the three business areas in a bit more detail. And we start by handing over the word to Martin, who will tell you a bit more about Solix Group.

Good morning, everyone, and thank you, Andreas. I will say a few words about Salix. So we had a growth in the quarter of 7%. Underlying organic growth was flat in the quarter Market conditions are improving. We have 2025 seen an uplift in organic growth. I will be back to that. Even though we didn't see it in the quarter, we have seen an underlying growth overall. DIY is the sector where we see some uplift during 2025. And DIY represents some 20% of our business. We also see an uplift in the professional segment. If we add the two together, we have some 50% of our business where we see some sort of uplift. Quarter four is less DIY heavy for us. It's not the home improvement, home renovation period where our products are really sort of safe. We're not selling so much for the home renovation area in the Q4. If we take the EBITDA, we grew by 74% compared to last year. That is an organic growth of 45%. So 45% EBITDA growth despite the flat organic sales growth as previously mentioned. The EBITDA margin reaches some 9% in the quarter, which is an improvement over last year of 3.5 percentage points. So from 5.6% compared to last year. So 2024, as we see it, was a little bit of a challenging year. So the climate, we believe, where the market bottomed out. So just to remind ourselves that comparable numbers were a bit low 2024 when we compare this year's numbers with last year's number. So margin expansion, we continue to improve our operational performance in the quarter. Normalization of exchange rates and fried costs supports margin, but also structural measures and improved value chain activities in the operation. That's been on the agenda over the past years. And we see the benefits of it in improvement, both in cost percentage, but also in margin improvement, both in the quarter, but also in the total year. So if I summarize 2025, we pass 4 billion in sales. We pass 400 million in EBITDA. The 4 billion in sales, we see around 15% in growth sales and 4% comparable growth during the year. Out of the 400 million, it's, as Andrea said, 50% in total EBITDA growth and 25% in organic EBITDA growth last year. That makes us land on a 10% EBITDA level that should be compared with 7.6% 2024. I'm also happy to see that our working capital is moving in the right direction and that our growth came out of the comparable business, of course, is something that we are very happy about. I'm proud and happy for what the team has achieved and hard work during the full year. So thank you for all the hard work to my dear colleagues listening into the call. So if we move to the next slide, I will say a few words. As Andrea said, Solix is preparing for a potential listing. And here are a few headings about the cornerstones of how we would like to present our business. I've selected a few comments from this slide, and I would like to bring your attention to the right-hand side of the slide, where you see the financial targets. So these four financial targets of net revenue growth of more than 15%, I will come back to EBITDA margin. EBITDA networking capital of more than 40% and the net debt two to three times the earnings. The EBITDA margin, we did have an increase during spring together with the board of Salix and Volati to increase that from 10 to 12%. And keeping in mind that we landed 2025 on a 10% EBITDA margin, we see further potential to improve margin, hence the new targets of 12%. Moving our attention to the left-hand side of the presentation, a few selected comments here. We have delivered stable growth and performance in a period of challenging market conditions since 2022. We have acquired eight companies since 2022, sustained a healthy EBITDA margin combined with a controlled net debt ratio. We have improved productivity and performance through yearly structural measures as I said. This is an ongoing way of working for us to go through yearly structural measures to improve productivity that then delivers good cost control, improved margin and in the end over 80% cash conversion. This combined helps us to invest in next upcoming business. Logistics, sourcing and common transport contracts are areas where we benefit from our common scale of cooperation. And with this said, we are ready for volume growth as we have experienced an overall loss since 2022 of some 25 to 30% in the period of volume. It's not the sales value, but volume loss since 2022 of some 25 to 30% because of the market conditions. Next thing I wanted to say a few words about is the M&A, which is part of our DNA. We lead and develop our main business in such a way that we can acquire next business. And our way of realizing synergies adds to the SOLIX overall performance. If you see in the bottom of the slide, it talks about a standalone entity. And I would like to bring your attention to that. The Volati system has developed us as an organization, as a team, with training and education in such a way that we work independently with M&A today. We have been trained, I believe, from some of the best, Andrea standing next to me, and the colleagues of Volati. So thank you very much for all the support throughout this development. So we went through some 150 potential targets, 25. We're selective about what companies that we would like that could suit us the best and where we can add value and be stronger together. We see right now more activity in the market and we are hopeful that we can step up the game a bit from the past average around two acquisitions per year since 2022. We have a strong presence in the Nordic to further build and expand our M&A agenda, but we are also curious to broaden this horizon outside the Nordics in the period to come. So all in all, with improving underlying market conditions, 4% organic growth last year, our perspective a strong team throughout the SOLIX businesses. We look forward to an exciting future and first and foremost we look forward to an exciting 2026. Thank you.