Welcome to Viva Wine Group presentation for 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 CEO Emil Sallnäs and CFO Linn Gäfvert. Please go ahead. Good morning, everyone, and welcome to our Q2 2025 presentation. My name is Emil Sallnäs, and I will, together with our CFO Linn Gäfvert, present today. This is the agenda for today, and before we go into the quarterly update and financials, I want to start by giving you a short introduction to Viva Wine Group. We, now after the acquisition of Delta Wines, have two main segments in the group – business to business (B2B) and business to consumer (B2C). Business to business consists of the Nordic countries as well as the Netherlands, Poland, Belgium, and the Czech Republic, all markets where we do not sell directly to consumers. B2C consists of our e-commerce business based in Germany, but with consumers spread over a number of countries in Europe. In our B2B segment, we operate in the Nordic monopoly market. We are the clear market leader in wine, where we are the clear market leader in wine. Our operating companies are active in Sweden, Finland, and Norway. Now, with Delta Wines, we have expanded our B2B presence into Europe. Delta Wines has a strong presence in all distribution channels from retail, sales to e-commerce platforms, food services, wine shops, and exports. In our B2C segment, we operate three e-commerce platforms – Vickampo, Wein Furst, and Wine in Black, covering in total 11 different markets. Now, let's move on to the Q2 update and our performance summary. Net sales increased significantly due to the acquisition of Delta Wines and increased by over 20%. Organic growth was positive at 1%. A positive effect from Easter was partly offset by a slower development following cold weather in May. Furthermore, we have a comparison effect versus last year, when some of our colleagues had severe logistical problems, which boosted our sales in Q2 2024. We increased our gross profit, while our gross margin percentage declines as a result of the acquisition of Delta Wines, a business with lower gross margins than our historic business. Our remaining business, excluding Delta Wines, increases in gross margin. Adjusted EBITDA for the quarter decreased to 7.5%, compared with 9.6% last year, as a result of the lower gross margin percentage, one-time expenses for the acquisition, and additionally from the previously communicated step-up in OpEx. Now, let's look in more detail at the financial performance, and I will hand over the word to Linn. Thank you, Emil. We have a positive net sales growth of 20.2% for the group, as Emil mentioned, a result of the acquisition of Delta Wines. Viva Wine Group, excluding Delta Wines, was affected positively by Easter, but as Emil mentioned, due to very cold weather and also high comparable figures in Sweden Q2 2024. Still, the group managed to grow organically by 1%. In our B2B segment, Delta Wines is the growth driver in Q2. Without Delta Wines, the sales were flat versus last year, with a small negative currency effect. B2C declined slightly in the quarter, which is entirely in effect from a negative exchange rate. Our B2C business showed a small growth in local currency. We have a decrease in our adjusted EBITDA versus last year. The main reasons are our strategic OpEx step-up to be able to support our growing Nordic business, marketing investments in our B2C segment, and professionalization of the organization. The lower adjusted EBITDA margin is a result of the lower gross margin percentage in the acquired business and our investments in OpEx. The gross margin percentage, excluding the acquired business, continued to strengthen. Looking at our net working capital, it has increased as a result of the acquisition and higher inventory. Net working capital to net sales is higher due to that only one month of net sales is included. A high-level simulation, including net sales for 12 months, shows that the ratio is in line with numbers pre-acquisition. We have the same development in net debt, where we have full effect from our new loan, but only one month result. We expect to deleverage ongoing as the EBITDA is consolidated month per month. A high-level simulation of adding 12 months of EBITDA reduced the number from 4.1 to approximately 3. We expect to deleverage and reach our financial targets of 2.5 within approximately one year. To go with our cash flow, we have a stable operating cash flow in the quarter. Cash flow from investing activities includes the acquisition of Delta Wines with a cash flow effect of SEK 566 million. Cash flow from our financing activities is according to plan, where dividends were paid during the quarter, planned acquisition of shares in subsidiary was paid out, and further change in liabilities to credit institutions, where we include the new loan of SEK 633 million. Thank you, Linn. Now, over to the performance by segment. In the second quarter of 2025, we took a decisive step in our growth strategy with the acquisition of Delta Wines, a big step towards our strategic goal of becoming a leading European wine group. We are happy to share that the integration of Delta Wines is proceeding according to plan, in many ways facilitated by the fact that the corporate cultures and business models are very similar. Delta Wines was consolidated into our accounts with effect from May 23, which means that only a little over a month of Delta's operations are included in our reporting of this quarter. Financial numbers for that period are in line with our expectations. Over to the monopoly markets. In total, monopoly sales in the Nordic region decreased in volume compared with the corresponding quarter in 2024. There was a positive effect for the market because of the timing of Easter versus previous year, but this was not enough to compensate for the cold weather and lower consumer sentiment. In Finland, also the sales of 8% wines in supermarkets continued to take shares of the monopoly sales. For the Nordic markets combined, Viva Wine Group reported a market share of 22.6% for Q2, which is a slight decrease from last year, but again, worth mentioning that our market share last year was boosted by logistical problems in the Swedish market. Even so, Viva Wine Group remains the clear market leader in the Nordics, and both Norway and Finland performed better than their respective markets and increased their market shares in the quarter. Looking at our segment B2B, the net sales in segment B2B increased significantly by 24.8% in the quarter, with an organic growth of 1.1%. The increase versus last year is driven by the acquisition. B2B, excluding Delta, is unchanged. Although Easter fell in the second quarter, sales for Wine Group in the Nordic markets have been affected, as mentioned by the cold weather and strong comparative figures in Sweden. Adjusted EBITDA is in line with last year, while the adjusted EBITDA margin in the quarter decreased and ended at 7.8%. The main reasons for the lower adjusted EBITDA margin percentage are explained by the lower gross margin percentage in Delta Wines and the OpEx step-up from investments in marketing and professionalization. The gross margin percentage in the ongoing business increased in the quarter. The market in our B2C segment continues to be soft, although we are seeing positive signs of stabilization of our customer base. In the quarter, we had 12% more first-time customers than in 2024. The sales in B2C had a positive organic growth of 0.6%, which is now the second quarter in a row with some organic growth. To put this into some perspective, we estimate, based on available market data, that the market was down 5%- 10% in Q2. We continue to work hard on growth, and we have successfully tested and invested in new channels and approaches for acquiring new customers, and as you have seen, this has shown clear results. In the B2C segment, we have continued positive organic growth, while net sales were below previous year due to negative FX effects. Consumer sentiment, as Emil mentioned, continues to show low figures, especially in Germany. In Q2, however, we saw small signs of recovery, and we have continuous positive organic growth, which strengthened our belief of further stabilization in the market. We have a weaker gross margin, mainly due to the product mix in the quarter. We continue to pursue our strategy of balancing sales and profitability while investing in marketing. As we now see some stabilization in our customer base, we are investing to drive future growth. We maintain a strong and consistent cost control within our efficient cost base. Adjusted EBITDA margin in Q2 was lower than prior year, driven by the lower gross margin percentage and investments in marketing. Now, a few words on our sustainability work. Our annual sustainability report for 2024 was published during the spring. This was the first report in which Viva Wine Group consolidated sustainability data for the whole group, beyond Sweden, to include the international operations. We are, as many companies, working on aligning our reporting with the CSRD and ESRS frameworks. A highlight in the report, and something we are proud of, is that in collaboration with suppliers and the Nordic monopolies, 73% of the group's total volumes in 2024 were sold in low-climate impact packaging, including bag-in-box, Tetra, pouch, lightweight glass, and PET. In Q2, our latest acquisition, Delta Wines, was included in the Viva Wine Group. By onboarding Delta Wines, we are expanding and strengthening the sustainability organization. To summarize, overall, the second quarter was dominated by our strategic acquisition of Delta Wines, which significantly increases our footprint outside of the Nordics. The integration has been successful, both organizationally and operationally. Regarding M&A, we now, of course, have a focus on our recent acquisition, but we remain active in M&A and see an increased deal flow in both our segments. Finally, we have now laid the foundation for continued growth. We have a stronger, more diversified business and a well-prepared organization. We are confident and look forward to the end of the year and the year ahead. With that, it's now time for the Q&A session. 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 Fred from SEB. Please go ahead. Yes, good morning, guys. Thank you for taking my question. A first one, if I may, on your gross margin. You stated that the gross margin expanded year on year, excluding the Delta Wines acquisition. Could you potentially give us that gross margin figure, i.e., what would have the gross margin been excluding Delta Wines in Q2? We don't present that number, but it is an increase of approximately 0.5%. Okay, got it. Very clear. Thank you. The second question, if I may, on the increase in OpEx. Could you just elaborate on which cost categories are temporary in the OpEx increase, i.e., sort of integration and one-off relating to the acquisition versus how much of the OpEx increase is more structural investments? The follow-up on that question is how we should think about the cost base into 2026, please. We have one-time costs related to acquisition of approximately SEK 9 million, and looking at the OpEx added by Delta Wines in this quarter, it's approximately SEK 20 million. I would say 61% is related to the acquisition of the total OpEx. Looking at our OpEx estimates, as we have communicated earlier, we expect the OpEx level towards net sales to be in line with the 2023% and that is our guidance that we still keep. This year is an OpEx step-up. However, we have no planned increase in OpEx step-up next year. That number should be slightly decreased next year. Got it. Very clear. Thank you. The final one, if I may, on your gearing. Net debt to EBITDA rose to 4.1, if I'm not corrected. However, the pro forma number, as you stated in the presentation, is roughly around 3. What are your sort of concrete deleveraging priorities going forward? Are you seeing any synergies between working capital or sort of what's your strategy going forward, essentially? We are expecting to deleverage with the positive addition of EBITDA going forward. However, worth mentioning that Delta Wines has a good working capital and will contribute going forward to this number. Mostly, it is a fact that we are prioritizing to consolidate EBITDA, and that will give the effect of deleveraging. Okay, you expect net debt to EBITDA with the consolidation to still be around 3x or? No. We only have one month of EBITDA in our numbers now. However, we have the full loan. When we consolidate the result going forward, we will reduce the ratio. Okay, if you were to consolidate the last 12 months EBITDA from Delta Wines, what would the net debt to EBITDA pro forma ratio be? We have no exact pro forma, so it's approximately 3.0, as we have stated in the PowerPoint presentation. On top of what Linn mentioned, there is also the amortization that will, during the coming year, come into effect. Yeah, we will amortize our loan according to plan, and then we will add our result. Got it. Very clear. Those were all of my questions for now. Thank you for taking the time. Thank you. The next question comes from Frederick Iverson from ABG. Please go ahead. Thank you. I've got two questions in addition. First one on the market. You mentioned that the cold weather impacted negatively in Q2, and I'm curious whether the better or even good weather in Q3 has impacted the market positively. If you could give some color to the market development as you've seen in Q3. If you look at the weather report to start with, of course, July was very good, August less so. In combination, I think the weather has been maybe according to expectations overall. July was a strong month, and if you look at the publicly available numbers from the monopoly so far, the sales have been very strong in July. Okay. I think you should read also that they are slightly less so in August, although we're not finally over the line in August yet. Yeah, sure. Thanks, Emil. My last question, a detailed one somewhat, but you mentioned that adjusted EBITDA from Delta was SEK 9 million. Was that excluding or including the SEK 9 million transaction costs? I haven't said that number. We were talking about the OpEx number, where the acquisition cost was SEK 9 million of total OpEx, and Delta Wines' OpEx of that number is approximately SEK 18 million- SEK 20 million. It says in the report that Delta Wines makes a positive contribution of SEK 9 million. Okay, yeah. That number is the same as the acquisition cost, so yeah. Yes. What was the follow-up on that? Yeah, is that including or excluding the SEK 9 million transaction costs? I guess it's including. Including. Okay. Yes, they are contributing with that number. As we say also in the report, as our current business, where we have the sales development over the year, is very similar, Delta Wines compared to our old business. Also, in profitability, the strongest quarter, Q4, is also the strongest quarter for Delta Wines. It will have the same seasonality effect. Excellent. That's all my questions. Thanks so much. The next question comes from Rauli Juva from Inderes. Please go ahead. Hi, Rally from Indiers here. Just one question, basically, from me. I was wondering, how do you see the current market outlook in your markets for the remainder of the year, and if there's any major differences in the markets, like the Nordics, to your European markets? No, I mean, if you look at the Nordic markets, I think we should expect them to behave in a quite similar fashion as they've done so far this year. Of course, Finland, there is the shift to supermarket sales that affect the alcohol sales. Norway, we expect to decrease in sales somewhat. Sweden, we're basically around zero, maybe a minus 1%, something like that. Difficult to say. There is really no change in our market outlook in terms of the monopoly markets. The advantage with the monopoly markets is that there are public figures that are actually very, very correct because it's a monopoly. In the other markets, it's much more difficult to say anything about the market growth, and we haven't done so far. We don't see the Dutch market and the German market are behaving as we have explained before. Okay. That's clear. Thank you. The next question comes from Niklas Elmhammer from Carlsquare. Please go ahead. Yes, hello. Thank you. Thank you for clear answers already. Just a follow-up question regarding the development of Delta Wines. You said sales were as expected. Is it possible to elaborate a little bit? What does that mean? Is it growing or is it stable? Sales is in line with expectations. As we stated in our press release, those are the numbers that we display of what they had, 2024 numbers. Sales is in line with that number. Thank you. Just finally, regarding the gross margin, maybe I missed this, but did you provide any guidance on gross margins going forward? If we're looking at the gross margin percentage, we have the Swedish market where we expect small improvements going forward. Especially in Q4, we expect an improvement both year on year and also going forward. At the total level, the gross margin percentage, when we include Delta Wines, will be a bit lower, but that's only because of the margin structure where we guided. I think it was last call that the GM percentage is approximately around 14% for that business. Adding that as we go on, consolidating, that will, of course, impact the margin structure. However, we expect our ongoing business in that segment to strengthen. Okay. Got it. Thank you. Thank you very much. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time. I hand the conference back to the speakers for any written questions and closing comments. Thank you. There are some written questions from Alexander. We have a question on current trading. Peers are talking about good weather and strong July. Any comments regarding that? That has been already answered. Gross margin at current Eurocert levels, do you expect a positive contribution from gross margins in Q3 and Q4? Yes, as mentioned, this is related to Sweden, which is, of course, our biggest contributor to the B2B segment. There, we expect in Q4 that it will have a positive effect in gross margin. Regarding Delta Wines, can you share some more data, especially regarding the organic growth profile? Is it reasonable to expect mid-single-digit organic growth for Delta this year and in the medium term? As mentioned, when we presented Delta Wines, we expect them to be in line with our general growth targets. Yes, if a single digit means 4%, this is the goal which we aim to, which we expect to reach. On OpEx, I think the answer has been given already, but OpEx was 40% up or SEK 50 million. How was that related to communicated OpEx ramp-up versus increase from Delta-related numbers? Also, is any other OpEx increase related to one-off costs related to the acquisition? We have one-off costs related to acquisition, as mentioned, but we remain of the guidance of the total level for the year, where we guide that the OpEx towards net sales will be in line with the% in 2023. That is the guidance for this year, and perhaps slightly below. That is the update. Got it. There's a question from Anders Persson. Hi. Is the gross margin of Delta Wines for Q2 lower than expected? Do they have seasonal effects, and do you expect the gross margin to increase due to synergies related to the merge of the operations? They have a seasonal effect in the gross margin percentage in Delta Wines, but it's not lower than expected. The communicated number in last call was approximately around 14%. That is for the full year. They also have a seasonality effect where Q4 is the strongest period for gross margin. That could vary between 2% up and down. The full year is according to expected. What we see now in the gross margin for this year, we don't see any immediate effects, but we are working very good together with operational synergies and our integration. No immediate effects this year in the gross margin related to acquisition, but of course, we are working on it long term. There is a follow-up from Anders regarding dividends. Do you expect to keep the same dividend policy after the acquisition? The answer is yes. There is also a follow-up from Alexander. Adjusted EBITDA, please confirm that we understood correctly. Adjusted EBITDA of SEK 101 million did include SEK 9 million in one-off transaction costs. Yes, that is correct. Perfect. That concludes the Q&A session. Thank you very much, and see you when we report on the Q3 on November 20. Thank you all, and hope to see you soon.