Good day, thank you for standing by. Welcome to the SkiStar Interim Report Q3, September 1st 2025 - May 31st 2026 conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speakers today, Stefan Sjöstrand, CEO, and Sara Uggelberg, CFO. Please go ahead. Thank you for that introduction, warm welcome everyone to this quarter presentation for Q3 25/26. The agenda for today is that we will go through a bit of the Q3 performance. We will go through a financial update. We will guide you through a bit of an outlook and a summary. Let's start with the Q3 performance. Before I just jump into the numbers, I just really would like to highlight again that SkiStar is the market leader for the Scandinavian mountain holidays. We are running six destinations in Sweden and Norway. We have a market share of 42%. We are really proud of our integrated business model, where we have the digitalization as a driver and an enabler. We're also really proud of our significant land bank for property development. We will take you through that as well later on. If we jump into the Q3, we present net sales with a five percent increase. We have a lower operating profit with eight percent decrease. If we exclude the exploitation gains, we can say we have a par result compared to last year. Our operating margin stays at 24% compared to 25 last year. As we mentioned in the Q2 report, we had a very challenging booking situation in the end of the season. That's why we also decided to go for a lot of activities, price campaigns, marketing activities. Unfortunately, that didn't pay off as we expected. That's why that costed a bit on the margin, since we lowered the prices. It costed also a bit on the cost side with the marketing efforts. We could also see that we had a decrease of skier days sold in the period as well. If I summarize, you can say that we had a good growth in line with our financial goals. We are not satisfied with the result. We also have taken some actions going forward to secure that we can have a more stable result development, also Q3 going forward. Since we are summarizing the winter season, I would like also to talk a little bit about the accumulated result. Here we can say that we have a seven percent increase on top line. We have a five percent increase on the operating profit. If we then compare without the exploitation gains, we actually increased the result with eight percent. Also we deliver a very stable result here, we must admit. We increased the skier days with 0.5%. However, we have this hesitant real estate market, we have said that since we have this hesitant real estate market, we also can see that we have had zero income and profit from real estate market the first nine months. Also the outlook for the real estate market isn't on the top as it was in the good old days. We are saying that we will most probably land on the same level as we did last year with the real estate gains. However, if I look into the first nine months, we have increase in all revenue streams, it is actually still strong demand for mountain vacation. We can see that we continue to increase the number of international guests. We have put a lot of effort in investments for this year, we can see that we have an increased level of guest satisfaction and that help us to have growth in all revenue streams, actually. We will continue to invest in this, especially to secure a good customer experience development. Again, the international guests, they are a drive for us to increase the revenues, they now stand for 40% of the total bed-occupancy rate. The most important with the international guest, I must say, is that they buy these long ski passes, six - eight days, they do it long time in advance. They also book more. They book the full package, so to say, they do it in long time in advance, everything, actually. It's also very good that the peak weeks differs also from, you can say, the Swedish guests, which is, of course, good that we can filling out more weeks and work with the capacity in another way. Also, they are increasing over time as well. We're really proud that we have improved our guest experience this year. We have invested in better ski experiences. We have done that in wider slopes. We have done that in actually more snow guns. We have done it in more lifts. We have invested in better accommodation experience, we have taken large help from AI as well. When the customer had contacted us, we have really had good help from AI, that has speeded up the answers to our guests, which has been very helpful. We're also very proud that we have invested in the ski pass price differentiation. That has helped a lot of customers to also choose other destinations or also destinations with a more value-for-money ski passes. We are really proud to have the lowest ski pass in the mountains, actually, for our guests. Also more precise governance around the KPI, around the NPS values. We work very hard with that across the whole organization to secure that we continue to improve our guest experiences. I think sometimes we don't talk enough about our integrated business model because skistar.com is a fantastic engine because we own this distribution channel, we are not dependent on any other distribution channel. I think many others are jealous that we can own this distribution channel because this help us with the diversified revenue streams. It help us to have this dynamic pricing model. It help us to have a lot of different guest interaction and also help us to collect a lot of customer data, which has enabled us to be much more specific in our tailored sales. This integrated business model also help us to improve and also expanding our customer offer to define and find new revenue streams. This is one example, and this is taking from our development of our retail business. We have had a very solid development of the retail business. We have a CAGR of 11% since 2018/2019, and the last couple of years, the development has been really significant strong, and specifically with our own brand, EQPE. With the last quarter grown 30%, actually. Really, really strong development of EQPE brand. We also have this significant land bank, the land bank enable us to have an organic growth within our company because we can both continue to develop ski areas, and we can also continue to strengthening the destination's ecosystem. By doing that would also help us to develop the whole destination in a way where we control the development more or less. We can also develop the destinations in areas where we really want to steer the guest flow, so to say, since we have this control of the also ski areas. By to have the integrated real estate development model, we can also create value through the property development, and it also drives growth. This year, we open up new beds in the next fiscal year, sorry, 2026/2027. We open up 600 new beds in Sälen where we have seen a potential to grow with more beds as an example. That is helping us to grow with own beds, and we do it with warm beds, and we do it in the integrated ecosystem, which is, of course, very strong within our business model. We continue to enhancing capacity and guest experience. This year, we had this investment in the gondola in Trysil. We had the new ski area in Vemdalen, Hovde Syd. We have lighting projects, and we continue to invest to really secure that we enhancing the guest experience among our ski destinations. I think we are proud of this, and we continue to be forward-leaning in all these actions. Sara, I hand over to you to talk a little bit about the financials now. Thank you, Stefan. If we start with the net sales development, it has been fairly good. The status show the net sales development last 12 months that amount to 7.3%. The Q3 net sales year Q3 was five percent and accommodated Q3 was seven percent. Of course, as Stefan mentioned, the net sales development during the Q3 has been not slow, but a bit less than expected. If we continue with explanation on net sales development, in total, if we exclude effect from currency, the revenue growth was eight percent in comparison with last year. We have had increase in all our revenue streams. If we start with ski pass, the ski pass effect was six percent in total, where the price and mix effect amounts to 5.5%, and the volume was 0.5%. Accommodation was up 6.2%, where price and mix amounts to 4.2%, and the volume growth was 0.2%. As you remember, we acquired Topeja, which is Högfjällshotellet in Sälen in May last year, and we've had, of course, an increase in revenue that relates to the acquisition, and that is included in accommodation, but also in restaurants. We've had a fairly high increase in restaurants, 36%, but the majority of the growth relates to the acquisition of Högfjällshotellet. We've had growth in ski rentals, in ski schools, and not the least sports shops that was up 13.7%, and it was driven by a strong growth related to EQPE, our own brand. If we continue with operating profit and the operating profit development last 12 months, the margin was 17%, and the amount was SEK 836 million. During the period September to May, the operating profit was SEK 1.1 billion. That was an increase in comparison with last year that amount to five percent. If we exclude exploitation gain, the increase was 9%. Just to remember, we've had no property transaction during the period. We expect to have a transaction during the Q4 that amounts to more or less the same level as last year. The underlying operation has been solid during the quarter, but we have also had positive impact that relates to one-off items. I will explain those later on. If we take a look on the development per category and in comparison with last year, now we haven't had any property transaction during the quarter. The mountain operations has been positively impacted by ski pass revenue growth. We've also had increased costs due to higher energy and fuel prices and higher consumption. We've also had higher costs that relate to maintenance and repair. We try to improve or increase the volume related to both ski pass and accommodation. We have spent more marketing during the quarter to improve the bookings. The operating profit has had a positive impact that relates to an insurance compensation of SEK 11 million. That relates to the bridge in Vemdalen that was demolished. If we take a look at the SkiStar shop and rentals, the growth has been strong, both on online sale and physical stores. We've also had a positive impact that relates to an adjusted inventory value of SEK 21 million. The acquisition of Högfjällshotellet has had a positive impact on the operating profit that relates to hotels. Property management has had an increase in operating profit, but that is related to income to other segments, so it's internal income. We have also adjusted or transferred some costs to mountain operations that relates to cleaning and airport fee, et cetera. In total, the operating profit development, excluding exploitation gain and currency, was up by nine percent. If we move on to cash flow and CapEx, the cash flow from operating activities last 12 months was SEK 1.2 billion, and it has been positively impacted by improved profit. CapEx has been fairly high, and that is related to several significant investments that was made ahead of the winter season, where the gondola in Trysil stands for the majority of the amount. The CapEx during the quarter, the Q3, amounted to SEK 77 million, which is a decrease in comparison with the Q3 last year. Year to date, CapEx amounts to SEK 427 million. Net debt to EBITDA structure is very low, 0.9, and it is fairly high or huge headroom in comparison with our financial target of 2.5. The financial preparedness as of 31st of May amounted to SEK 1.7 billion, which is a high increase in comparison with last year, and that is due to the refinancing that was made in June last year. Interest-bearing liabilities, both included and excluded IFRS 16, has decreased during the quarter. The financial KPIs, if we start with return on capital employed, has improved and amounts to 11.3%. Equity to asset ratio has also improved and was 52%. If we exclude IFRS 16, the equity to asset ratio was 67%, and last year the number was 64%. In summary, the financial targets. If we start with revenue growth, it has been a fairly high or a satisfactory revenue growth, and that amounts to 7.3% last 12 months. The operating margin has stand on more or less same level as the last financial year. This amounts to 17%. We expect the margin to improve going forward. It will, driven by revenue growth and operational efficiency, and I will come back to that. The net debt to EBITDA was 0.9, as I said, a quite high headroom in comparison with our financial target. If we talk about the operating margin, we do expect the margin to improve going forward. It's a combination of additional efforts to further improve our guest experience, but not the least, initiatives that have already started that will improve our ability to use our resources better going on. It's related to staff scheduling, combined duties, initiatives that relate to investment and purchasing processes, economies of scale, et cetera. Those together will improve our margins in the future. Thank you, Sara. I will now try to guide you through a little bit of the outlook. I will start with the summer period, where we have the next or upcoming months in front of us. Here we are. We have been working now for a couple of years to develop the year-round offer. We have been working with winter for more than 50 years, and this is the fifth summer season where we work with this year-round offer. We try to take small steps all the time. This year we have been very successful to launch these family passes and also bundle different type of activities, where we include different type of packages. We also have a soccer tournament in Sälen for the first time. We will see that the bookings are up three percent, which is, of course, very good. We could also see that the presale of different type of packages has been very successful. We are gladly looking forward to the summer. What's happening at our destinations during the summer also is that all investments for the next or upcoming winter season happens right now. Here we have earlier sent out the message that we will invest heavily in snow production, and that means that we will offer the most snow guarantee, and we will do that by investing in the snow production. That will be by increased water capacity. We will have close to 500 new snow guns. We will have a new ski lift in Åre, also we will continue to invest this with artificial light to prolong opening hours as well that we will prolong and make a much better guest experience. I'm really glad that we have decided to take a large grip also on our largest destination, Sälen, where we will continuously talk about even more new events happening and concepts in Sälen going forward. If I then look into the winter season. As we have mentioned in our quarter report, there is a strong demand for the winter holidays, and it's also prioritized among families. We can clearly see that. We're also very glad to see that the bookings are up three percent. We were a little bit surprised by this strong number, actually. We had in our Q2, plus minus zero, and now, the last couple of weeks, the booking has had a very steady growth every week by week. We believe that one of the reason for this is that the launch of the Scandinavia's most extensive snow guarantee will be one of the real reasons for that, because we will offer something completely unique in Scandinavia by offering this snow guarantee and also possibility for our guests to cancel or rebook even up to close to the stay. We feel very confident in this guarantee since we are investing so heavily in the snow production. We also have a very strong Christmas and New Year calendar this year with an extra week, 53, where we will gain extra ski days for sure. The early Easter week 12/13 means that we will also work very adjustable with the end of the season connected to how we will have opening hours, et cetera. That will also help us according to what Sara just spoke about with the scheduling and also how we will combine different type of roles within our staff. Price increases, we will increase the lodging prices fairly 0%-1% as we want to become even more attractive in the lodging prices. We will have a ski pass increase for the upcoming seasons, 4%-4.5%. We will also continue to launch and have the lowest price in the Scandinavian mountains on ski passes. We will add an extra low price ski pass this year with Duved. That will, of course, be complemented by the last year's success of Klövsjö, Storhogna and Sälen Högfjällshotellet. some really good price ladder with really good low price alternatives for those consumers who wants to go for that alternative, as well as the ones who wants to go for the full scope. If I summarize where we are right now, we can see that we have a very stable development that also enable us for further revenue growth as well as improved margins. I think we have some really good learnings this quarter that we have to work much more with flexible costs and also look into our cost side, which we are doing and have been doing the last two months in a good manner actually. We also continue to invest, like Sara also said, to strengthening our guest experience and satisfaction. We can see that it really pays off. one really important part of that is, of course, to launch this best and most extensive snow guarantee within Scandinavia. We still see hesitant real estate market, meaning that we see a much slower development as we have thought compared to how it was in the past, meaning that we will say that we will most probably coming in in the numbers like we did last year in that size. Lastly but not least, we see a strong demand for mountain vacation, plus three in booking, both for the upcoming summer as well for the winter season respectively. By that, we open up for Q&As. Thank you. We will now begin the question and answer session. If you wish to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We will take our first question. Your first question comes from the line of Alice Beer from ABG Sundal Collier. Please go ahead. Your line is open. Hi, good morning. Just a first question. Your OpEx base has grown quite a lot this fiscal year so far. Could you give us some color on this? Just how much is temporary and how should we think about the run rate? Just what you can do to improve scalability short term. I missed actually the first part of your question, Alice. Sorry. Please repeat the question. No worries. I repeat. Your OpEx base, your costs have grown quite a bit this year. Could you just give us some color on the OpEx costs and how much of this is temporary and how much you think about the run rate? Just what can you do to improve scalability and reduce costs? Yeah. I can try to answer that, Alice. During the quarter, we've had temporary increases that relate to fuel and electricity. I guess some of the reason may be the geopolitical situation, where we've seen increases in both, especially related to electricity, that the costs have also been impacted by volume. It was very cold in January and February, the consumption that relates to electricity was also high. Some of the increase that relates to electricity is related to temporary price and temporary volume, I would say. When it comes to fuel, we have had very high prices that relate to HVO 100 that is used for more or less all vehicles, and the price increase was more or less, you have the numbers. SEK 29 per liter the last month of April, which of course is impacting us heavily. Even if it was just one month, April. In March, we paid SEK 25 per liter. Of course, that impact us heavily in the quarter. Yeah. I think that's one of the reason. Like Sara said, we are hedging electricity on our expected levels. Since we had an increase of electricity use during this cold period, we had to buy electricity on the free market. Of course, that costed us extra much this quarter, more than we expected. If I continue, we also had high costs related to marketing activities, both related to the possibility to improve or increase the sales for ski pass and accommodation. The efforts didn't pay off, actually. I would see that cost or that spend as a temporary one. We also had high marketing spend that relates to our online business in retail. Those are expected to slow down or decrease going forward. That is what happened during the quarter. If you then look forward, we are now, since two months back, working on our cost situation, both from a staff perspective, but as well on purchasing activities. I think this staircase we showed on the slide, which we call initiative to reach our financial targets. If you look into the middle part of that, when we say efficient resource allocation, that is something we are working with right now. We also expect that we are coming into our next fiscal year 2026/2027 on a new level from a cost perspective. Yeah. Which feels very comfortable going forward. The efforts that relates to the combined duties, the scheduling of staff, that will mean that we actually reduce number of employees or FTEs, and it's a combination of temporary resources and other resources or employees. In total, we have fairly high number of employees that will be reduced. We have a number of initiatives that will improve the cost base going forward. Okay, perfect. Thank you for that answer. Moving on then. Hotel sales are growing quite a bit, while mediated accommodation did not this quarter. Is this a deliberate shift? Are you seeing more organic change in demand from normal accommodation to hotels? Again, Alice, sorry, can you please repeat the question? I think we need to increase the volume here as well. You're talking about increase in net sales. This will be bad. Hotel sales. Okay. Hotel, yeah. Quite a bit. Yeah. Normal mediated accommodation did not. Is this a deliberate shift, or is this an organic change in demand? No, that relates to hotels. Of course, we've had an impact or effect from the acquisition of Högfjällshotellet, that has impacted, of course, the volume and the revenues that relate to hotels. If you look into the accommodation, we lowered the price quite heavily during the Q3. Also tried to trigger consumers to book and so on. I must say, all the efforts we did by increased marketing, lower the price on accommodation, lower the price on ski passes, didn't pay off at all. Unfortunately, that was wasted money more or less, I must be honest and say. Okay. Thank you. Moving on. Could you talk a bit about the rationale behind closing Vemdalen for the summer? Despite this three percent higher bookings for the summer? Yeah, absolutely. If we look into what's happening in the market, you can say when we decided to go for full scale of summer activities, we decided to continue the development of Åre, where it started already actually in around 2007 in small scale. When we decided to go all in for summer, we decided to continue Åre, let's go for Trysil, let's go for Sälen. We did that the first two years, three years, then we said, "Let's add Hemsedal and Vemdalen." Unfortunately, we don't have the number of guests enough to run five resorts in the summer. That's why we have decided to not run this climbing park as well as the lift in Vemdalen for the summer. We still have openings for possibility to book overnight there, and also buy clothing in our store, et cetera. That has been important to keep open. As well, we do the same in Hemsedal, Åre. We also have limited opening times, et cetera. We go full and all-in in Sälen, Åre, and Trysil, because there we see that there is possibilities to drive these summer activities in full scale, more or less. Okay, perfect. Then you said that 30% of the upcoming winter accommodation is already booked. Could you provide some context here? What is an average booking rate for this point in time? We are actually a little bit. We say around 30%. We are 30% plus. We're a little bit above last year since we have this three percent increase. We are on a quite same level. What I think is important is that we had added number of beds, both the 600 new beds in Sälen. We have also added top hotel in Åre, of course. If we then say that we are plus three percent, of course, it's on a very good level, I must say. A very stable level. If you look into the number of booked overnights, it's on actually fairly high level, probably the highest level we had since the pandemic. Okay, great. I think that was all from me. Thank you. Thanks. We will take our next question. Your next question. Please stand by. Your next question comes from the line of Karl-Johan Bonnevier from DNB Carnegie. Please go ahead. Your line is open. Yes, good morning, Stefan and Sara. A couple of questions from me as well, please. You mentioned the insurance claim that you got the payback on and the reversal of the rental equipment accrual that you have done. I guess these are more timing effects or how should we see them? I guess you had the insurance cost at some stage, and you also had done the accrual at some stage. Could you elaborate a little on how the timing of these things works? We weren't sure when we were supposed to receive this insurance contribution, that took place now in the third quarter. It has been recognized in other income. When we actually rebuild the bridge, it will be recognized as an investment and included in CapEx. We need to treat those transactions as two separate ones. I guess in, say, the Q1 or Q2 next year. I'm not sure about the number, but it's roughly the same. Yeah higher amount. Yeah. You say 20. Yeah, roughly the same number. Roughly. Yeah. Yeah. It exactly like you asked, we weren't sure when that insurance money would come, actually. Now they came a couple of weeks ago. Yeah. They gave us some positive numbers, of course. It should be seen as a one-off item. Yeah as it has impacted the profit and loss. It will not impact. Of course, it will be impacted as a depreciation, but the transaction will be treated as an investment. The other question was around ski rental. We have reduced or we have adjusted the inventory value that relates to equipment, rental equipment. That is also one-off item. This level effect we'll be seeing going forward as well, but not in one quarter. It will be for a whole year next year. The level effect will stay. If you carve out those two- This represent something that it Sorry. Yeah, sorry, Stefan. No. If you carve out those two items, I think we are on the expected level from the expected result this quarter, more or less, we can say. Those are two one-time positive effects on the quarter result, of course. Yeah, I guess at least with the rental equipment, you must have over-accrued then in previous quarters. Maybe if you're looking at over the full year, then- Yeah it doesn't really matter, does it? No, correct. That's correct. Totally correct. Mm-hmm. That will be more than. And when you- Sorry. On the other side, you mentioned earlier the extra marketing cost and the higher HVO 100 cost and these kind of things. Are these numbers basically matching against what you now have as these positive one-offs in the quarter as you see? If you take the negative one-offs you had in the quarter, we are basically on a lower level on the total. That's a fairly good assumption. Absolutely. Yeah. I remember in Q3 last year, with the late Easter, you had the problem ramping down the operation in an efficient way. It looks like you have been able to ramp down much more efficient already this year. You mentioned that's an opportunity for next year, or am I over-reading things? You are right. We are still not satisfied with that ramp down, to be honest. That's why we have decided to be even lighter, so to say, for next year, because we have too much fixed cost where we are sitting in. Our business model and full opening makes us very vulnerable when the volume decrease. Like it did in the Q3 now. That's why we have decided to try to keep a little bit lighter and work much harder with these combined duties, with the scheduling, et cetera, to have a smoother operation, so to say, going forward. That's something we also now have the organization backing up, even though it's, of course, tough when you need to do it. It is helpful going forward. Excellent. When you look at the already good booking situation for the next high season, the three percent increase. How do you see the mix there developing when you're looking at international demand compared to local demand? We continue actually to be on a quite stable development of the international guests. They are on the quite same level. It is actually the Swedish guests who is coming back now. They are standing for the increase of the booking. Which is very gladly to see that the Swedish guest is returning back now since a couple of years of maybe reductant since we have had high cost of interest rates, high cost of energy and high cost in general in the society. We can also see that consumer confidence is coming back in Sweden, and I think this is a result of that when we see the strong booking numbers. Excellent. One final, looking at the CapEx budget going into 2026, 2027, do you see that being in absolute, say, in SEK on an unchanged level compared to what you see in this year, including all those investment you detailed? Yes, I would say that the level will be more or less the same. That is, of course, related to the investments in snow production that will sort of keep the levels a bit higher than usual. Yeah. Excellent. Thank you very much and all the best out there. Thank you. Thank you. Thank you. As a reminder, if you wish to ask a question, please press star one one on your telephone. We will take our next question. Your next question comes from the line of Stefan Stjernholm from Handelsbanken. Please go ahead. Your line is open. Yeah. Stefan here. Can you hear me? Yes. A question on the next winter. Given that Q3 did not really meet your expectation. You talked about doing adjustments for the ramp down of the destinations. What else can you do differently for next season? I think what I try to explain is that we are working on our fixed cost situation. We have built up too heavy organization. That's why we want to become lighter, more or less. It will be on staff. We are also identified a lot of different type of purchasing projects, how we want to do different type of purchasing. Like many other companies, we are also reducing cost and looking into our total cost situation, which has been important to do for us because we really want to secure that we will not be as vulnerable as we became in the third quarter this year. We had to be able to adjust. We will also work much more with the opening hours and opening time in the end of the season, which meaning that we will have a different plan how we are running our ski resorts. We will open first, then we will close latest as we have done, but it will differentiate between the destinations. We are working quite hard on that scheduling as such, meaning that we will be much more efficient as a totality, I can say. Okay, thanks. My other questions have already been answered. Thank you. Thanks. Thank you. Thank you. This concludes today's question and answer session. I will now hand back for closing remarks. Thank you so much for listening to us today. Also, thank you so much for very good questions making us try to explain even more about our quarter result. By that, we are wishing everyone a nice midsummer, if you are in Sweden, and, of course, everywhere else as well. Enjoy now the time outdoors, because we would like to do that and going to the mountains and enjoy hiking and biking. This concludes today's conference call. Thank you for participating. You may now disconnect.