Welcome to the Karnov Group Q2 2025 Report Presentation. For the first part of the presentation, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing the pound key 5 on their telephone keypad. If you are listening to the presentation via webcast, you can ask written questions using the form below. Now, I will hand the conference over to CEO Pontus Bodelsson and CFO Magnus Hansson. Please go ahead. Welcome everyone to Karnov Group 's Earnings Conference, where we will present the outcome of the second quarter of 2025. Please go to slide 2. I'm Pontus Bodelsson, President and CEO of the company. With me, I have our CFO, Magnus Hansson, and our Head of Investor Relations, Erik Berggren. Magnus and I will present the outcome of the quarter using a few slides, and then we'll open up for questions. With that said, let's get started with the presentation. Please go to slide 3. In Q2, we achieved solid growth with continued AI momentum and improved the margins. Customers are adopting our AI solutions with high satisfaction, and usage is increasing steadily. We continue to advance our positions and will enter the market for AI-powered workflow tools this autumn. I'll come back to that later in this presentation. Net sales grew to SEK 649 million in the quarter. The organic growth was 5%, driven by strong online sales in Region North, including customers adopting our AI solutions. The adjusted EBITDA margin improved to 23%, which is an improvement of two percentage points compared to Q2 previous year. Leverage was 2.5x, well below our financial target. Please go to slide four. We are pleased with the accelerated organic growth and margins improvement in Q2. The legal market is progressing in the shift to AI-supported solutions, and our AI assistant is a leading AI solution for legal research in our markets. Our customers become significantly more efficient, and customer satisfaction is high. We have a solid momentum and progress with AI sales. In Q2, AI sales was an important component of the accelerated growth in Region North. We are still early in the adoption curve. The accelerated growth and margins improvement in Q2 is driven by Region North. We are decisive in the reshaping of Region South. The financial performance in Q2 is below our ambitions. Margins declined in the quarter as books and sales of training courses were weak, especially in Spain. As a first step, we have divested the Spanish training business. Excluding the training business, the margin would have been 1.5 percentage points higher in Q2 in Region South. I'll come back to our ambitions for Region South in a few slides. Next slide, please. Karnov Group is well positioned for AI-powered legal workflow tools, thanks to our mission-critical local content and strong customer relationships. All our AI solutions are co-developed by Karnov's tech team, legal domain experts, and customers, ensuring trusted results, seamless adoption, and measurable productivity gains. This autumn, customers will benefit from our AI-powered workflow tools that identify the risks and propose legal improvements. By combining our customers' own documents and Karnov's proprietary content, we will not only broaden the scope of work we support, but also deepen the value we deliver to our customers. This is our entrance into the market for AI and content-powered workflow tools. If I were to explain Karnov's new step to someone who isn't a lawyer, I would probably use the following analogy. It's like moving from offering the best legal map to also providing a GPS for legal work. Next slide, please. In this slide, you can see our two cost-efficiency initiatives running until the end of 2026, with the ambition of harvesting efficiencies of EUR 20 million in total. At the end of Q2, we have achieved annual run-rate synergies of EUR 18 million. We progress ahead of plan. Next slide, please. I will now present our segment performance, starting with Region North. Region North continues to perform exceptionally well, both in terms of organic growth and profitability. The organic growth of 13% is driven by higher subscription-based online sales, including AI uplifts. However, we are still early in the adoption curve. In addition, our EHS businesses are expanding their customer bases and attracting new clients. Margins are continuing to improve, primarily due to operational leverage from higher net sales, but also thanks to positive synergy effects from our acceleration initiative. Next slide, please. The financial performance in Region South in Q2 is below our ambitions. Our French business generated solid growth in the quarter, driven by online sales as we are attracting new customers. Our Spanish business generated online sales growth, while the sales of books and training courses were weak. We are not pleased with these results as they offset the effects of our cost-efficiency efforts. At the end of July, we divested the Spanish training business, and we will do more product rationalizations of unprofitable products. Excluding the training business, the margin would have been 1.5 percentage points higher in Q2 in Region South. With the quarterly performance in Q2 below our ambitions, I remain confident in our medium-term financial targets for Region South. The Spanish merger is completed, and we can reap the full benefits of our strong local proprietary content. In France, our flagship products generate strong interest from the market. We are now preparing to fully bring our AI experiences from Region North to Spain and France. Next slide, please. With that said, I will now hand over the floor to our CFO, Magnus Hansson. He will tell us more about the financial results. Magnus, the floor is yours. Thank you, Pontus. Let's start with an overview, switching to slide 10. In Q2, we achieved net sales of SEK 649 million, a solid net sales growth of 4%. The growth is driven by increased online sales, including selling more licenses to existing customers, higher tier packages, AI uplifts, and attracting new customers. Currency effects had a negative impact on net sales of 4%. Last 12 months, group net sales grew by 6%. Please go to slide 11. Breaking down net sales on segment level, we see continued strong organic growth in Region North and negative growth in Region South in the quarter. Region North had an organic growth of 12.6% thanks to strong online sales performance, while Region South declined 1.7% due to weak offline sales, in particular books and training course sales in Spain. Negative currency effects are further contributing to the decline in Region South. Revenues from AI sales are increasing quarter by quarter as the subscription revenues are recognized over the contract period. Next slide, please. On slide 12, you see the net sales development within online and offline, split into segments. In Region North, the online sales increased by 17% compared to Q2 last year and accounted for 96% of the net sales in the quarter. In Region South, the online sales grew by 3% compared to Q2 last year and accounted for approximately 81% of net sales in the quarter. Organic online sales grew by 4% in Region South. Please change to slide 13. Subscription-based sales increased during Q2 and represent 89% of sales in the quarter. The flat development in subscription-based sales in Region South is related to negative currency effects and the negative offline sales in Spain. The online subscription sales constant currency grew by 3% in Region South. Please change to slide 14. The adjusted EBITDA amounted to SEK 148 million in the second quarter. This corresponds to an adjusted EBITDA margin of 23%, which is an improvement of two percentage points. Last 12 months, adjusted EBITDA increased by SEK 116 million and reached 24%. Synergies are coming through as expected, meaning personnel expenses are decreasing. Items affecting comparability amounted to SEK 46 million during Q2 and are restructuring and post-merger costs in Region South. At the end of Q2, we have achieved synergies within the group of EUR 18.1 million on an annual run-rate basis. The effect in the quarter compared to baseline amounted to EUR 4.1 million. We are progressing according to plan to achieve synergies of EUR 20 million with full effect on an annual run-rate basis by the end of 2026. Let's move on to slide 15, please. In Q2, net sales amounted to SEK 320 million in Region North. Organic growth was 12.6%. The growth is driven by online sales. We continue to strengthen our market position and attract new customers. Adjusted EBITDA reached SEK 165 million in Q2. This is an increase of SEK 45 million compared to last year. The adjusted EBITDA margin amounted to 44.2%. The improvement is due to operational leverage from increased net sales and efficiencies from the acceleration initiative. Please move on to slide 16, which is the Region South segment. Net sales in Region South declined by SEK 19 million compared to Q2 of last year. Currency effects had a negative impact of SEK 16 million in the quarter. Our French business grew by 2%, while the Spanish business declined by 3%. Growth in France is driven by online sales, while the decline in Spain is driven by weak book and training course sales. The adjusted EBITDA margin was 8% in the second quarter, which is well below our ambitions. The decline is driven by weak book and training sales, as well as higher depreciations due to completed development projects. We continue to invest in the French business and allocate AI resources for future growth. Synergies are coming through according to plan, but are offset by the weak offline sales. Compared to baseline, the cost base has decreased by SEK 23 million in Q2. Excluding the divested training business, the adjusted EBITDA margin would be 1.5 percentage points higher in Q2. Moving to slide 17, which presents the segment group functions. Expenses in Q2 were SEK 20 million. Please go to slide 18. Q2 is typically a cash-neutral quarter. The adjusted free cash flow was negative SEK 3 million, which is slightly lower than Q2 of last year. Leverage was 2.5x EBITDA last 12 months by the end of June, well below our financial targets. I'm now handing over to Pontus again, who will present our last slides. Thank you, Magnus. Please switch to slide 19. In Q2, Karnov Group delivered accelerated growth and solid margin improvements thanks to strong performance in Region North. AI adoption is gaining momentum with our AI solutions driving measurable customer efficiency. In Region South, we are reshaping the portfolio for profitable growth, while the financial performance in Q2 was below our ambitions. The Spanish training business was divested at the end of July. This autumn, customers will benefit from our AI-powered workflow tools that identify risks and propose legal improvements. By combining our customers' own documents and Karnov's proprietary content, we will not only broaden the scope of work we support, but also deepen the value we deliver to our customers. Please go to slide 20. I will end our presentation, and we are now ready to take questions. I'll hand over the conference again to our host. 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 Predrag Savinovic from DNB Carnegie. Please go ahead. Hi, good morning, Magnus, Pontus, and Erik, and thanks for taking my questions. Let me start by unpacking North a little bit. On the accelerated sales here between Q1 and Q2, this seems to be mainly AI upselling on existing customers, as you phrased it. What is the contract longevity here typically? Is it like three months? Is it more trial-based, or is it annual contracts? Hi, Predrag, and thank you for the question. We sell AI the same way we sell all our online products. It's typically annual contracts. Okay, so this basically then means that given this is quite a big jump in organic growth between Q1 and Q2, that this should probably be consistent then for Q3 and Q4 as well, all else equal, right? We should be able to extrapolate this organic trend for H2, right? Yeah, we of course don't answer questions regarding forecasts and so on, but what we can see in Q2 is a strong development within the AI revenues, and that's of course based on the subscription base. There's also other areas which are performing quite strong in the quarter. For example, the public sector is performing really well in Region North. EHS is performing really well. There are a number of different components to it, but yes, AI is performing well. All right, most of this kind of between-the-quarter performance is still, you know, it's the typical annual contract structure, even if it's the public or EHS. Yeah, good. Yeah. On the south margin, I see the 1.5 percentage points remark that you did. Shouldn't the margin still be expanding year-to-year, considering the synergies you have been realizing and the run rate, etc.? Yeah, we are, as Pontus mentioned, not at all pleased with the result in Region South in this quarter. The one explanation is of course the training course business in Spain. We're also investing in future growth in Region South. We are, as you know, investing in the sales team in France. We are investing in AI features and so on. It's a combination of making sure we achieve our synergies and the training courses and also, of course, investing in the future. Shouldn't the margin also be helped if offline sales become a smaller share of sales, which seems to be the case now in the second quarter? Yes. Online growth, shouldn't that help you? Yes, it should. Typically, online sales have a higher gross margin, of course, than offline. Okay, I still think it's a little bit difficult to understand kind of the margin drop. I guess, if you're investing more than you're raising the cost at the same time while you're taking cost out, is that the right way to see it? Okay. Absolutely. That's one of the factors, absolutely. Okay, thanks. That's all for me. I'll jump back in line. Thank you. The next question comes from Thomas from Nielsen. Please go ahead. Hello, thank you for taking my question. In Q2, we saw a negative adjusted free cash flow despite stronger EBIT. Can you explain the main drivers of the working capital swing? Yeah, so there's a quite strong seasonality to our cash flow. Typically, the cash flow is in Region North really strong in Q4, beginning of Q1, and in Region South in Q1. Typically, Q2 and Q3 are quite neutral. As we, of course, invoice annually in advance, we get that seasonality. You could also argue that as the offline sales in Region South are decreasing and the offline sales have a higher degree of transactional sales, that will also impact the cash flow in Q2. Seasonality is the main driver. It's typically neutral cash flow quarters in Q2 and Q3. Okay, thank you. Cash flow generation was strong in the first half of the year overall with SEK 276 million in cash flow from operating activities. What confidence do you have in converting adjusted EBITDA into cash at a targeted 90 100% level for the full year? Yeah, so again, with the seasonality, Q1 is really strong as we invoice annually in advance. Also, we will have, of course, the same effect in Q4 this year as we usually do with strong invoicing. The second thing I would argue is that as we decrease our IACs going forward, as we are closer to the end of the cost initiatives in both the PMI and the acceleration initiative, we will see a better cash flow going forward. Okay, thank you very much. Thank you. There are no more questions at this time, so I hand the conference back to the speakers for any written questions or closing comments. Okay, thank you everyone for listening and thank you for your questions. We will disclose our Q3 report on the 12th of November, and we hope to hear from you then, of course, if not earlier. Thank you. Thank you.