Welcome to Haypp Group Q2 2025. 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 the speakers, CEO Gavin O'Dowd and CFO Peter Deli. Please go ahead. Good morning, everyone, and welcome to our Q2 2025 conference call. Our CFO, Peter Deli, and I, Gavin O'Dowd, will take you through our results. Starting at slide four, I would like to focus on three key aspects of our operational highlights, beginning first with our nicotine pouch Q2 volume year-on-year growth of 23% on a like-for-like basis. We would like to highlight that this doesn't reflect two key impacts on comparability, which reduced our growth rates. One, the Easter effect, which moved from Q1 in 2024 to Q2 in 2025, which we highlighted in our Q1 presentation. We estimate that this impacted growth by circa 3 percentage points. Two, in Q2 2024, was an exceptional quarter driven by Zyn shortages in the U.S. Much of the incremental traffic we received due to the Zyn shortages resulted in sales of non-Zyn brands, which grew over 50% quarter on quarter in Q2 2024. Please refer to our Q2 2024 presentation for more context. Adjusting for these factors, nicotine pouch growth rates are similar in Q2 to Q1 2025. Secondly, revenue continued to grow at circa 20% on a like-for-like basis, adjusting for Easter, in line with the last 12 months' performance. Lastly, I would like to draw your attention to the material increase in our gross margin. Our business philosophy is built around sharing our economies of scale with our consumers in the form of superior convenience and best value. Despite aggressively moving forward on both of these areas, Haypp Group was still able to increase its gross margin by nearly 5 percentage points to 19%, reflecting the power of our operating model. Moving to slide five, I'd like to touch on how the U.S. market is changing and how we are investing. Starting with the market on the left-hand side, the overall market continues to show robust growth, driven both by customers moving over to the category and by increased consumption rates for those in the category for a number of years. The U.S. nicotine pouch category is now larger than the U.S. legal vape category. In parallel, fragmentation within the category continues to accelerate with further introductions of FDA-allowed products. As an anecdote, we launched more nicotine pouch SKUs in the U.S. in Q2 2025 than in all of 2024. Regulation remains stable, with early signs of an increasing emphasis on ensuring that existing rules are complied with rather than introducing new legislation. While this is more evident on the vape category, it bodes well for nicotine pouches also. In conclusion, we believe the overall conditions for a compliant online retail are extremely bright, and we will continue to allocate resources accordingly. Moving to the right-hand side of the slide, which focuses more on our U.S. investment priorities, which we touched upon in our Capital Market Day in April. Since then, we have reinforced the team capabilities with our CCO recently relocating to our U.S. office. In addition, we have recruited a Head of Customer Acquisition, and in keeping with our commitment to compliance, we've onboarded both Heads of Legal and Regulatory Affairs. We consider these additions to our team to be an excellent bedrock to build a sustainable business from. We've focused much of our effort in recent months towards further improving our retention rates, which is key to maximizing the returns we will achieve from new customers in the future. Initiatives such as the same-day delivery in Houston, which has now been expanded to a broader area, and the new loyalty program are key drivers to this improvement. While we continue to further sharpen our retention rates, we will also try out a range of tools to accelerate our customer acquisition rates and assess their success before allocating material resources. Finally, as we said in our Q1 release, we see Zyn supply and demand aligning within the U.S. market, and we continue to expect a return to selling Zyn at some stage in the second half of 2025. Moving to slide six, which covers legal and regulatory updates, we remain engaged in two legal cases. In Stockholm, the appeal process is ongoing in line with expectations. We expect this will take between one and six months. As previously stated, we don't expect any material commercial impact from the outcome of this case. In San Francisco, settlement discussions are ongoing. In the EU, the EU released an initial draft of a tax proposal on nicotine products, including nicotine pouches. As with previous EU tobacco tax initiatives, we expect the final outcome to be radically different from the initial proposal, especially given the number of member states which have openly opposed this draft. However, we do welcome that nicotine pouches are a duly recognized category in the draft, which is a strong step towards recognizing the category in other areas of regulation. In the U.K., a nationwide ban on disposable nicotine vape devices came into effect on June 1, 2025. Vape manufacturers changed to similarly branded rechargeable pump systems to limit consumer confusion. We believe the shift benefits online retailers over the long term. Haypp Group is in full compliance with the new regulation. However, the transition by offline retailers from disposables continues, creating a temporary distortion in the market. With that, I will now hand over to Peter Deli for an update on our financial performance. Thank you, Gavin. Good morning, everyone. We have concluded the successful quarter. Our underlying sales development in the North and/or North American increased further, allowing us to initiate the necessary investments, primarily towards the U.S. market, to lay the foundation for the next growth chapter. Despite the increased level of investment, our adjustment increased by 50 basis points versus last year's 4.2%. On slide seven, let me begin with our sales development. As Gavin highlighted, to understand the underlying performance similar to Q1, we must consider not only the impact of the discontinuation of Zyn, tobacco, and the closure of some states in the U.S., but also the phasing of the Easter. Q1 reported growth was due to Easter higher, while Q2 is lower than the reality due to the Easter time. To mitigate this distortion, we should look at extended periods from January to April and March to June. Growth rates for these periods are very similar, around 20% year-over-year. There is no change in the product composition of those drivers. The reported 17% growth is mainly driven by nicotine pouches, with smooth decline mainly in Sweden impacting work performance on the digit by 3%. However, this is fully offset by the emerging segment contribution of 3% of the overall growth. On slide eight, going into more detail about the like-for-like sales development, you can find the key drivers for the year-over-year sales growth. On a like-for-like basis, four business units contributed to the growth. The main driver remained in the U.S. Foreign exchange movements, particularly the depreciation of the Norwegian krona and U.S. dollar against the Swedish krona, have negatively affected the imported sales. As discussed earlier, Easter impacted both business units. Relative to the growth rates, it had a bigger impact on the core markets. Excluding the impact of Easter, the core markets grew by 9%, while the growth segment grew by 51%. Moving to slide nine and progressing a few lines down in the P&L, you can find the long-term quarterly development of Haypp Group's gross margin, both in absolute terms and as a percentage of net sales. Compared to last year, the increase is the same as previous Q1. Yeah, we managed to increase our gross margin driven by consistent volume and top line growth and an increase in contribution for Media & Insights business. By looking at the increase versus Q2 2024, it is important to highlight that the discontinued part of our U.S. business was not a major contributor to our gross margin growth, so the reduction in sales without significant negative gross margin exceeds around 2% points of the increase versus last year. In Q1, we achieved a major step up in our gross margin rates. In Q2, we managed to further improve these rates thanks to the increased contribution of the Media & Insights business. I would like to reaffirm the foundational principles of our business model. We allocate the value created by our company across the consumers, business partners, and shareholders. Our ongoing target is to enhance the value we provide to consumers, which in turn requires us to strengthen the value we generate for our business partners. By continuously improving our Media & Insights offering, we are able to deliver greater value and convenience to our consumers while also driving healthier profit margins. Moving to slide ten, I would like to provide an overview of our overhead base, which increased to SEK 170 million in the quarter. This increase is mainly driven by the U.S. and other growth markets attributed to enhanced local team capabilities and category awareness and PR efforts. On slide 11, you can see the key figures around our profitability. On this slide, we highlight key metrics and trends in our profitability. Adjusted EBIT for the second quarter grew by 11%, reaching SEK 38.3 million. The adjusted EBIT margin increased 4.2%. The increase is driven by a better gross margin, partly offset by increased investments. Investment levels into the U.S. organization and PR in Europe boosted brand awareness, though one-off cost in Sweden impacted also the Q2 P&L. While Q2 market levels stepped back versus the record high Q1, it is still 50 basis points better than Q2 2024. The increase in depreciation is partly driven by the U.S. warehouse automatization, which we installed in the middle of December last year. We maintained our investment into the emerging segment. This quarter, the investment amounted to SEK 11.4 million and reduced the overall adjusted EBIT of the group by 1.2 percentage points. Adjusted EBIT for the core and growth business units was 5.4%, above the 5% mark targeted earlier. Moving to page 12 and our core markets. I mentioned that this segment delivered an overall 6% constant currency net sales growth. Q2 was heavily impacted by Easter. The growth during the March to June period was 9%. Behind the sales growth, the compensating brand dynamics remain. The nicotine pouch segment, which accounted for 55% of the volume for our core markets, up by 6% points since Q2 2024, maintained its growth and consistently gained share. The smooth segment's growth remained in decline, driven by the reduction of the underlying consumer demand. These two opposite dynamics mean that the sharing phase of the fast-growing nicotine pouch segment will improve the overall growth rate of the core markets. I'll pause for a moment and reset the sound. We're going to pause the conference call for a moment to try to adjust the sound. Bear with us, please. We are experiencing some technical problem. We will come back shortly. Can you hear us? Gavin, can you hear us? Excellent. Apologize for your difficulties. You can continue. Thank you. Page 12 and our core markets. Two different segment dynamics. What we experienced, as I mentioned to you, with the nicotine pouch segment growing while the smooth is declining. These two opposite dynamics mean that the sharing phase of the fast-growing nicotine pouch segment will improve the overall growth rates of the core markets. Adjusted EBITDA remains strong for this segment. The 10.2% Q2 results are 1.6 percentage points above last year. The driver behind the increase is clearly the media revenue. Moving to the next slide, slide 13, and our growth markets. Net sales, excluding currency impact on a like-for-like basis, is up by 49%. Looking at an extended period of March to June to mitigate the Easter impact, this growth is 51%. While all markets increased their sales, we are very pleased with the high-double-digit growth rates of the U.S. and nicotine pouch volume development in the U.K.. Adjusted EBITDA in absolute terms amounted to $3.1 million, and the adjusted EBITDA rate is 1.5%. While the profitability is stable versus the same period last year, it is a reduction versus Q1. Gross margin remains stable for the segment. However, the overhead increase mainly driven by the U.S. negatively impacted the business units' profitability. On slide 14, our emerging segments. The sequential sales growth continued, and we are particularly pleased with the Swedish and German market performance. Q2 in the U.K. was challenging due to the turbulent market conditions caused by the disposable debt. Investment levels remain stable in this category versus the previous quarter. Moving to slide 15, I would like to highlight three or four selected KPIs. The full list of KPIs is available in the appendix of this presentation. You can find it on our website. Here, I would like to highlight three important metrics connected to the health of our balance sheet: inventory level, working capital, and/or leverage. There is no major change versus the end of Q1. Overall, our balance sheet remained healthy, with the net debt to adjusted EBITDA ratio remaining at 0.4 times. There is no major change in our working capital. With this, I would like to hand back to Gavin. Thank you, Peter. Moving to our outlook slide, slide 17. In our view, the long-term future for risk-reduced nicotine products, the online channel, and Haypp Group, with its many strengths, remains very encouraging. Haypp Group's operating model continues to generate increasing value for consumers and suppliers while also providing margin expansion. The expected increase in regulatory requirements is beginning to manifest, which further differentiates us given our sustained focus and investment on long-term compliance. As highlighted in our Capital Markets Day in April, the conditions in the U.S. market provide a significant opportunity for long-term value creation. As such, we expect to invest heavily over the medium term, which is expected to impact our short to medium-term earnings. Finally, on slide 18, we would like to touch upon our medium-term guidance from that Capital Markets Day in April, which runs out until 2028. We envision revenue growth rates of 18%- 25% CAGR over the period, with the U.S. market being a material contributor. This reflects the lower expected reported growth rates for 2025 due to the comparatively narrower consumer base in the U.S. We also guide towards 5.5% EBIT at the end of the period, plus or minus 150 basis points. While we have been materially increasing our EBIT over the last two years, we intend to reinvest part of this into the U.S. to accelerate our market share growth over this period. I would kindly direct your attention to our recent CMD material, which is available on our group site. This provides more detail behind these targets. Lastly, the company does not intend to issue a dividend over this period, instead reinvesting surplus cash flows into the company's future expansion. Before I open up for questions, I would like to take the opportunity to thank my colleagues for their dedication and hard work in delivering these strong results. With that, I will hand over to the operator for questions. Thank you. If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johan Hansson from SEB. Please go ahead. Hi, good morning, guys. Thank you for taking my questions. A first one on the gross margin development, a very solid development given the lower sales year-on-year. You state that this is driven by Media & Insights and scale, which in terms of Media & Insights, I remember that these are typically annual contracts. Thus, should we expect gross margins to maintain at similar levels going into H2? Good morning. Thanks for the question. Yes, you are right that we are running with annual media contracts, but it doesn't mean that the monthly or quarterly phasing of the revenue is always the same. It's similar, but not exactly the same. I think looking ahead for Q3 and Q4, you can expect similar level of margins as we delivered in Q1 and Q2, not the exact same, but within these ranges. Yeah, got it. Thank you. The second one, if I may, I noticed that you've added around 40 new employees during the quarter. While you mentioned in the report that some key hires are relating to the U.S., could you also elaborate on where the majority of these new roles are located and what functions or strategic areas are they focused on? Good morning, Johan. How are you doing? Firstly, yes, we have been adding materially to the U.S. team, although it's more at the senior level that we're adding into it. I think it's probably also worth reflecting that there might have been a small mistake in the Q1 report, so that the number of new employees increased from Q1 to Q2 may be substantially lower than that. I would expect the numbers to be coming in more in the high teens. Got it. In the high teens, this is roughly relating to the role. My question is really, this is not you staffing up, or is it you staffing up ahead of the supply or the return of thin supply in the U.S., i.e., factory workers or those kind of positions? No, our warehouse infrastructure, and this is equally valid for the U.S. as well, is highly automated. We're able to carry substantial increases in volume without materially having to increase our warehouse employees across any of our warehouses at this point in time. What you're seeing here is more of a focus on both predominantly the U.S. as regards to setting up some of the initiatives which we're driving forward at this point in time, and also some other key growth markets, particularly the U.K.. Got it. It's very clear. The final one, if I may, you stated that you expect the supply from or thin supply to return at some stage during H2. Do you expect this to happen more towards Q3 or Q4? Any sort of guess there? This is always a slightly complex point to discuss since there's ongoing discussions with various suppliers at any point in time. What we can say on this one, Johan, is that when we have more information, we will be sure to inform you at that point in time. I got it. Those were all my questions for now. Thank you so much. Thank you, Johan. The next question comes from Niklas Ekman. Please go ahead. Thank you. Yes, following up on some of Johan Hansson's questions here. As you said, the gross margin here is very strong, but we also saw a significant OpEx increase that ate away a lot of the gross margin expansion here in Q2. I'm just wondering, given that you are investing now in recruiting, and I assume that some of this recruiting, you don't have the full cost in Q2. Is it likely to assume that OpEx will increase further in H2 and that the margin expansion we saw here might be even lower? The EBIT margin expansion might be even lower or might even see contracting margins in H2. Good morning, Niklas. Thanks for the question. What we are doing basically is executing the strategy we laid down in the CMD. We identified the U.S. as a key market for growth opportunities, but we also recognize that the team we had there in 2023 or even in 2024 might not be sufficient to capture that opportunity. We started to build up that team already in Q2, and we are going to continue this work throughout Q3. I would not be surprised if we would see further increase in our overheads, which can then result in margin reduction versus Q2. That was the point that I was trying to touch on in one of my outlook points here as regards to that we do expect a slight EBIT reduction for the remainder of the year. Okay, very clear. Thanks for settling that. I'm also curious when looking at customers here. There's like a 9% drop in number of customers, and I assume that most of this is related to Zyn in the U.S. and some of these calendar effects, but also that even in core markets, you see a slight reduction in number of customers. Can you elaborate a little bit on the drivers behind this and if you think this could reverse shortly? Yeah, so I think there's two factors on that one. I think the biggest factor by far is within the U.S. I think it's worth bearing in mind that Q2 2024, there was a material spike in our customer numbers relative to Q1 2024. That was driven by that being the quarter where the initial Zyn shortages started to manifest within the U.S. market. We saw a substantial number of new customers coming through where we had to cap the amount of product that we could sell to them. Some of those customers went through to buying amounts of Zyn. Some of those customers went through to buying other SKUs as well. There was a material step up in our customer numbers in the U.S. in Q2 of 2024. That's by far the biggest driving force behind that. The second force is that, of course, the calendar effect as regards to when Easter fell, but it is a much smaller impact on us than the first one. Okay, very clear. Finally, you mentioned here the EU Commission and the potentially significant tax increase that they propose for nicotine pouches. Can you provide some more details here? What kind of, what magnitude of tax are we talking about? Obviously, you're recognizing that the final decision could be significantly different from what has been proposed. What is the proposition and what is the normal timeline for when this goes from proposition to being actually implemented? Yes, Niklas. I can only caveat very heavily that, and I think I'm not alone when it comes to other announcements that come out around this, nobody pays a huge amount of heed to what the initial draft is because if we look back at every previous process which went through like this, the final outcome is significantly different as it runs through. The proposal at this point in time would bring in roughly EUR 2 a can in nicotine across the border for your average nicotine pouch can. It's driven by weight, and as the products have been getting somewhat lighter over years, that might be reducing a little bit from there. The timeframe for that coming in would be somewhere between 2028 and 2030. I don't envisage that. I would consider it to be highly unlikely that it will be a quantum near that level which comes in. Very, very clear. Do you think there's any likelihood given the Swedish exception or the exemption from the snus ban? Any likelihood that the Swedish market could treat this differently, and then certainly the Norwegian market could treat it differently given that it's not part of the EU? Yeah, it's even more complex. Norway, of course, is a standalone case in itself, as would Switzerland be, and also the U.K., which are, of course, three very big markets for us at this point in time. Even if you look at those which are sitting within the EU at this point in time, there has been a significant number of countries which have come out and stood against this very firmly at this point in time. I think this is more a case of us taking this opportunity to explain to people what has been published as the initial draft, rather than taking this particularly seriously as a potential outcome. I would consider this to be a relatively low probability of manifesting in its current form. Very clear. Thank you. Thank you so much for taking my questions. Thank you, Niklas. Thank you. There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments. Perfect. Thank you very much for your time, everybody, and I look forward to catching up on our Q3 call in three months. Thank you. Thank you.