Volati AB

Good morning, everyone, and welcome to today's webcast presentation with Volati. With us today to present, we have CEO Andreas Stenbäck and CEO of Salix Group, Martin Hansson. After the presentation, there will be a Q&A. So if you're calling in and want to ask a question, please press star nine to raise your hand and then star six to unmute yourself when handed the word. You can also submit in questions via the form to the right. And with that said, please go ahead with and start your presentation.

Thank you and thank you everyone for listening in today. This is most likely also my last call with SOLIX as part of VEVOLATE and I'm very happy to have Martin Hornsson, the CEO of SOLIX Group at my side here today to give you some more flavor about the strong development in SOLIX. But let's get into the presentation. Velotti creates value by developing our today's six platforms, growing them both organically and for acquisitions. From this quarter, Salix Group is considered discontinued operations. while the remaining five platforms are now reported separately in our segment reporting and as then separate business areas and that will then be the remaining volatility of the potential separate listing of SOLIX Group. But we will get into more details about more all of these six platforms later on in the presentation. If I start by summarizing the quarter, mat sales increased by 3% and EBITDA came in 3% behind last year. So I do not typically talk about items affecting comparability or extraordinary items, but in this quarter, I think it's justified to do that. The reason being that we have significant costs related to the separate listing process of Solix Group. And that is also in the quarter where we have, because of the seasonality over the year, relatively low EBITDA. So these extraordinary items are affecting us more than usual. So if I adjust those, the EBITDA increased with 4% compared to last year. And what's the main reasons behind this growth? We have another strong, very strong quarter by Solix Group, growing with 37%. And that is now, I think, the fifth very strong quarter in a row from Solix. Etiquetto also showing a nice growth of 18%. Communication and Coraventa coming in in line were actually slightly better than last year. While we have two platforms, Synthierix coming in lower than last year, and Tuning Group actually quite significant behind last year. We will get into more details behind all this later on, but that I would say summarizes the situations among the platforms. We show very strong growth in profit after tax and earnings per share. And I'm also very happy about the cash flow that we see in the quarter. And this cash flow has enabled us to complete two acquisitions so far this year, adding roughly 930 million Swedish crowns of annual turnover. So we have had a good start of the year when it comes to acquisitions. And lastly, the separate listing process with regards to SOLIX Group are developing as planned. And we have an important meeting later on today. It's our annual general meeting, which will then hopefully decide upon proceeding with that process. Looking at the numbers a bit more in details, I'm not planning to discuss them actually in detail, but what one could see on this slide is also that the net debt to EBITDA ratio is now at 2.9. It's in line with last year and it's in the upper uh part of our uh net to uh ebda adjusted abda range uh but that's a very very deliberate decision by us to to to be there Looking at the figures on an LTM basis, our sales are up 4% while our EBITDA is up 3%. However, what I think is strong on this side is the operational cash flow, which has been very strong the last 12 months. And that's one of the key drivers behind why we have been able to also keeping up our acquisition pace. Our financial targets last time with SOLIX group most likely included. So again, behind on the EBITDA growth, we have discussed this now for actually a couple of quarters. We are currently operating under our EBITDA level, which we should achieve in a normal level. That has created our growth gap, the growth gap that I usually talk about. Once the market normalizes, I expect to close that gap. We've already actually seen it in Solix Group, while we have some of our platforms still behind. But what that means is that we will grow at levels exceeding our financial growth targets for some time once we see that happening on the group level. The return on equity, RUE, is back where it should be. It should be in excess of 20% and it's back now. And I actually expect that to continue to increase in the coming quarters and not that the BTA already touched upon. So with that, I leave the word to Martin who will tell you a bit more about SOLIX Group and the development there.

Thank you Andreas. I would like to present some results from Salix Group. So who are we? We are a growing B2B trading and distribution platform with an active M&A agenda. On the right hand side, you find a graph showing the sales development since 22, as well as the EBITDA margin. We landed sales a bit over a billion in the first quarter, which equals some 3% organic sales growth. And organic growth remained positive across several markets, although some segments continue to face some challenging market conditions. EBITDA grew, as you heard Andrea saying, organically with 37%. We now have eight consecutive quarters of growth, with five of them with some stronger growth, but eight consecutive quarters of growth in total. The EBITDA margin grew from 8% to 10%, leading to an LTM of 10.6%. So if we go back to the right hand side of the graph. It's our view that our relevant market have lost some 25 to 30% in volume since 22 to 24 when the decline bottomed up. And our sales held up in this period mainly due to sales price adjustments combined with eight acquisitions. And we believe that we are in a strong position to further grow in the period ahead of us with this market ahead of us. So the EBITDA margin improvements was mainly driven by favorably currency effects, product mix and implemented price adjustments. And as you can see in the bottom of the chart, our return on capital employed landed on 39%, strengthening from last year and further showcasing our capital efficiency. In the end, acquisition of Leidex, we are very happy about that. And I will comment and say a few words about that in a moment. This slide shows the EBITDA development per quarter since 2022. And as you can see, Solix experienced a negative earning trend from Q2 in 22 to 24, with acquisitions then partly offsetting the decline. We have had a strong earnings momentum since Q1 2025 with five consecutive quarters of substantial growth. And if you look into the details of the chart, you can see that we have eight in total of growth quarter by quarter. A few words about Leidex. That was our last acquisition, acquired first of April, and we are very, very pleased about this acquisition in Ireland. The company is called Leides, as I said, and the company is a market-leading building materials provider in Ireland. So Leides is closely aligned with the other SOLIX businesses in many ways, and we have a revenue of around 480 million with a reported EBITDA margin of around 13%. So this company provides a scalable platform for us for continued organic and acquisition driven growth in Ireland, which we find very, very exciting and I hope to build further on. So this will then give us a 10% share of turnover roughly overall in Ireland compared to the overall solids turnover. So it's in a good position to sum up. Solix is in a good position to further grow sales when the market turns. We do see strong favorable trends and drivers in our segments going forward that points to positive market trend in the future to come. And we are really looking forward to have Ladix on board. contributing both to growth and also performance for us in the coming quarters and years. So thank you very much to the Salix team and for a good quarter. And thank you, Andreas, for these couple of times when we have presented Polatia Salix together. Thank you.