Good morning, and welcome to Duell's webcast presenting the financial report for the first quarter of 2026 from September to November 2025. The report will be presented by CEO Magnus Miemois and CFO Caj Malmsten.

My name is Pellervo Hämäläinen from Investor Relations. You will have the opportunity to send questions in Finnish and English via the chat during the webcast.

At the end of the broadcast, there will be a Q&A session to address the sent questions. I think we are ready to move forward.

Magnus and Kai, stage is yours. Thank you.

Thank you, Pellervo, and good morning to everybody also from my side. The first quarter of our financial year that starts in September—September, October, November—is the period where we turn from summer season towards winter season.

In the beginning of the quarter, a lot of focus is on delivering preordered winter products to the dealer network. Also this year.

Then once getting in towards November, then typically the season is fully on and moving to daily sales. This year, unfortunately, the winter conditions in a good part of the Nordics, where of course the winter categories are mainly oriented, didn't really allow the season to get started in the way that it was expected.

A little bit delayed start to the daily sales of the winter season. Then as we had quite elaborately discussed and communicated around our full-year results that we released in October, we are in the middle of a transition period related to brand portfolio in our company in France.

Then, comparing to the previous year, then this impact also as a let's say a negative delta. All in all, then these two challenges, one external, one internal, is flavoring this quarter one for us.

Then consequently, with a slightly delayed demand picture on winter products, then of course it also impacted the inventory levels at the cutoff point at the end of quarter one. Overall, net working capital management progressed partly as planned.

Then looking a little bit opening up the various products and categories, the same comment there, that on one hand we had the market conditions and weather conditions in the Nordics. This was of course a moving picture throughout the quarter.

If you go in let's say really the most northern parts of Norway, they received a lot of snow quite early in the year, and the season opened there. Gradually, of course the northern regions received snow partly during quarter one, but if you compare the situation now, it has changed from what it was then at September to November period.

Of course, our focus and our development in other markets also continued while there is off-season. It's not totally let's say zero market in other regions.

Duell continues to explore and expand its Central European addressable market space. We see now when we have started to also put some attention towards Eastern European markets and Eastern European countries that there is some interesting potential.

This builds of course confidence in that the strategy we have in focusing on Central European growth seems to be a wisely chosen strategy. As touched upon, we are in the middle of a transformational sequence with respect to our portfolio brands in the French operation.

This started already on the previous fiscal year towards the end, and now this continued also in this period. However, of course, this kind of transformation takes some time, and we have now initiated certain rightsizing activities that are let's say tuned to the current situation.

This is of course necessary to do in a situation like this where there are disruptions in the trend. Then, as usual, we select a few highlights of our business to give a few snapshots across the Duell businesses.

We're a company with a very broad portfolio of products, a very broad portfolio of brands, we appreciate that it may be sometimes difficult to keep track of everything. Through this kind of few highlights, we hope to also serve some information that helps understand what's inside the Duell business.

The first highlight is continuing from my comment a second ago here: Eastern European countries. For us, we've started the Central European growth strategy of course in the larger economies with France, UK, Benelux, Germany, Poland being very very important focus countries for us.

Gradually, we're also exploring the potential in these Eastern European countries. When we have started this work, we see there is potential also in the smaller economies in Central Europe.

This of course is then allowing us to gradually also, in a way, expand the footprint there. What's maybe noteworthy when we look at the smaller economies there is that when the very mature markets are quite, you see let's say the long pedigree in terms of which brands, which products they favor.

The big established ones are definitely strong in all of these, whereas when we go to some of these more maybe we could say emerging markets, then we see a very strong adaptation of newer brands in the industry, both on vehicles, but also on parts and accessories and rider gear, which is our focus. This also gives maybe a little bit of a glimpse of how then the consumer preferences change.

It's important for us to have an insight into this also, we can take those reflections into how we develop the assortment for Duell in the future. The first highlight here is really about a growth potential.

Then switching to a totally different thing into the second highlight spot here. One of the house brands that Duell has in the portfolio is a brand called Snow People.

As the brand name indicates, this is about winter season, and this is about snow categories. Particularly maybe to the Finnish audience, if you have ever had the opportunity to visit Lapland as a tourist or perhaps used tourist services such as snowmobile safari, or husky riding, or ice fishing, or something similar in an organized way, then you might have seen this kind of monosuits that are black and red, or black and blue, and sometimes you see groups of tourists all dressed alike.

This is Snow People on the move. This is a product and a product family and a brand that we have since a number of years developed exactly for this segment, the tourism industry in Lapland.

A sector that grows quite nicely at the moment. We can read and see social media with famous movie stars dressed in Duell's Amoq gear and helmets in social media, and this of course nice.

This Snow People brand is let's say maybe more practical, more low-key, but for the broader masses. While we have talked in highlights quite often about Amoq being really the more sporty brand, this Snow People is catering to a different segment.

Maybe also interesting to note that there are products in the Duell assortment that is not related necessarily to motorsports or so. It's, in this case, these products are used also for, as I said, husky rides or tourism, ice fishing, and similar.

Just a snapshot. The third highlight is we communicated in October when we announced the full-year results that we have started a performance improvement program that we call Performance Uplift.

At that point, we were more in the starting phase, and this has now continued. I'll elaborate a little bit more on this later on in the presentation, but if you look at quarter one activities, this is one of the focus areas where we are putting a lot of attention now to identify and move forward activities and actions that aims at improving the performance, particularly profitability and capital efficiency.

This is now moving into execution phase here, and the planning phase is completed in quarter one. Then the fourth and final highlight in this session is the ongoing optimizations of our warehouse footprint in the Nordics.

We currently have three warehouses, and we're right now consolidating this into two warehouses. This work is going on as planned, and we're utilizing the slower season for these products to accomplish and complete this so we are in a place to serve customers in high level then when the season gets started towards the spring.

This is on track, on schedule, and will be completed in March as planned. This is all about operational efficiency and, of course, then also being able to also harvest the benefits of that financially in the second half.

Also, important to keep in mind, it's not purely about streamlining and driving efficiency. It's also an activity we do in order to serve some customer groups better.

In this particular case, it will allow us to better serve the Swedish and Norwegian bicycle dealer network with serving them from our Swedish warehouse then in the coming season. This is a logical rationalization and an evolution step that we are executing right now.

Then moving on to let's say the summary of the key figures for the quarter. Delayed start of the winter season and this transitions ongoing in the French company unfortunately led to that we were not able to reach the net sales levels of the previous year.

There's about a €3 million difference there in net sales. Then on the other hand, on gross margins, we are by and large on the same level, which indicates that, in terms of competitiveness, nothing material has changed.

We are able to keep up gross margin on more or less the same level. However, the difference in volume, of course, then also affected the profitability.

Adjusted EBITDA in this case ended up slightly negative when we compare it to the previous year, where we were clearly positive. Quarter one is always the smallest quarter in our seasonal profile.

As such, also small changes in volume hit quite a lot on quite immediately on the profitability. On the financial position, net debt continued to reduce, as expected.

Then, in terms of the leverage ratio describing net debt towards adjusted EBITDA, then in this case, we ended up in the ratio 4.2. With difference in profitability there, of course, also a little bit difference in there.

What is the profile, or let's say typical sort of this part of the year, given also from the point of view that it is in revenue the smallest quarter, then typically that the cash flow profile is negative during this part of the year. Also this year.

However, in a let's say improved position compared to the previous year, but still on the negative side. The highlights, or let's say key figures for the quarter.

Now I hand over to Kai, and we can elaborate on all of these and more.

Thank you, Magnus. Let's open up the financials a little bit more, and as Magnus said, very challenging first quarter.

In terms of sales, we had a decline in sales of 11.7% driven by the late start of winter and portfolio changes in France. The split between the regions, Nordics and Central Europe, more or less same level as a year back, Nordics going from 54% to 55%, no major change.

Same goes for the own brand sales, that's stable, ending at 20% of the total sales. We can see pretty clear increase for this quarter in the online sales growing from 25% to 28%.

That's of course a result of the mix of customers active during a certain part in time, but also the general trend in the market that online tends to grow. Moving over to profitability development with a pretty big dip in the volume, that naturally goes also through the whole income statement, affecting the adjusted EBITDA pretty much, going down to 0, -€0.1 million compared to a year back, a positive figure of €0.7 7 million.

If we look on the good side of the coin here, gross margins remains on a healthy level, 24.1%, just a small change compared to a year back. What we can see also here is the operating expenses is going down compared to a year back, I would say as planned.

We had a number of actions during last year in combination with the current ongoing France rightsizing activities, bring in the operating expenses to €5.8 million, a decrease of €0.3 million. Cost side is developing in the right way.

On the balance sheet side, we can see that we have a positive development in the net working capital down since a year back with almost €2 million amounting to €51.6 million now. Here, on the whole net working capital side, we have had a lot of work ongoing, and still a lot remains to be done, but we can clearly see that some parts are starting to pay off.

For example, the receivables side is developing in the right direction, where we have had for long time already focused activity on credit management, and we can slowly start to see the results here. Same goes on the supplier side.

We are continuously working with improving the terms with suppliers, and slowly we also see that in this case the payment terms is getting better and start to give effects. Unfortunately, then on the big piece here, the inventory, we can say we are on same level, slightly higher, but here we have also the impact from the missing volume from the quarter.

All in all, net working capital still on too high level, but direction for certain components are correct. As a result now when the volume is going down, then the inventory to LTM sales is growing to 39.7%, which is clearly still above our targets.

Work continue, and further results in the quarters to come. Financial position is pretty stable quarter to quarter here.

The net debt going as planned down to €22.6 million, decrease by €2.1 million. Leverage increasing to 4.2, this time driven with the weaker profitability, bringing the leverage figure up.

As a summary here, amortizations of loan are following the current plans, and cash position in end of the quarter, €3.2 million. Although the operational cash flow is negative for the quarter, -€1.9 million, it's a clear improvement compared to a year before.

If I in a nutshell summarize the financials, can say, all in all, a very challenging quarter affecting sales, profitability, but we can see some improvements on the operating cost side, net working capital, and also operating cash flow. Work continues.

I hand over to Magnus again. Okay.

Thank you, Kai. Then I continue with reiterating the guidance for the fiscal year.

As as we just concluded, a a challenging challenging quarter behind us. Again, quarter one being the smallest component in the in the full-year equation for Duell, then at this juncture, we we maintain the guidance unchanged.

Just to reiterate what that is: that we expect the the market environment to remain similar to previous year, and the guidance is that we expect organic net sales to remain on same level as last year, and also adjusted EBITA to stay on same level as last year. Then, as I promised earlier, I'll return to Performance Uplift a little bit.

Again reiterating, we we mentioned this in the full-year results release in in mid-October that we had launched this program. We did back then then the analysis that where are areas of where we have potential to improve performance.

Now during quarter one, we have converted that analysis and that target setting to concrete initiatives with concrete execution plans, people assigned and and attached to to these initiatives, clear schedules for implementation. Now we are in the in the point here at at the start of calendar year '26 where we move into execution and start to to do the work that allows harvest also of of the benefits.

If we open up a little bit what is the various themes inside the Performance Uplift program, there's a number of things. As mentioned also earlier, we have the ongoing transition and turnaround of the French business.

This is a its own, let's say, cluster in inside the Performance Uplift program with a number of number of activities, but maybe the most core ones being then to rebuild the the main the core of the the portfolio of brands that that represents the the largest portion of the business, and and basically move a bit closer also to to the rest of Duell in in terms of assortment. Inventory management is extremely important in this, because this is where where we can affect major KPIs, such as inventory level and and through that net working capital, or in general, you could say anything related to capital efficiency.

Also elements that are looking more you could say purely on the cost element of of things, such as how do we consolidate volume and and through that purchase power, for example, for logistics cost in in the company. We have a fair fair amount of logistics activities ongoing on any any given day of the week, so this of course translates to to significant cost elements.

Then it also includes elements that relates to how we address the market, how we segment customers, and and the portfolio of services that we offer for for for these these customers. This this is a quite broad broadly encompassing Performance Uplift program that aims at the outcomes of this aims at either improved profitability, which is you could maybe understand as improved improved margins, it addresses either either let's say the the margin side or the cost side, or or then the other big element and focus area is activities, actions that relates to capital efficiency, namely namely inventory and other working capital elements.

This is an center stage priority focus program now for us going forward, and with the ambition then of course to start to collect the benefits, harvest the the benefits of this program in in the second half of our fiscal year. Then moving on to recap of the Duell strategy.

We are this time of year, we are right now in the middle of in our annual clock to to revisit and review strategy, as as is customary on a yearly basis. This this work will go on into into the spring.

If we if we take the snapshot of of the Duell strategy and value propositions as as it is, then our ambition and our vision is to be the the preferred wholesale partner for both the brands we represent, but also for the dealer network that we that we maintain. We do this through one of the industry's most broad product offering compared to our competitors, particularly in the number of product categories we we represent.

This is particularly relevant, I would say, in the smaller markets. For example, in Nordics, where where the size of economy is such that dealers tend to aggregate different categories, also due to the seasonality, in order to have a a stable and sensible business throughout throughout the year.

Summer may be related to marine, and winter might be related to snowmobile, just to just to paint a a simple picture. This is the a strong value to our dealer network, but also equally to to to brands.

Then when we go into bigger economies, maybe more Central Europe, take take big economies such as France, or or UK, or or Germany, then this is not similarly profound. Then it may be enough market demand for a for a dealer to focus only on motorcycle rider gear, for example, or focus only on on bicycle.

The landscape and the dynamics a little bit different. In both cases, the resourcefulness of the Duell's offering is is a core element in in why why to make business mutually.

The house brand portfolio is equally important to to Duell and its and its dealers. The house brands often represent either a different price point of products or or a product in in in a space where where external brands don't have a a good good match.

This is a complementary to to the to the offering we otherwise maintain. Then moving to to the segment, or let's say the layer in the value chain where the our customers are, our dealers are, they are also different.

Some are purely e-commerce dealers. Some are purely brick-and-mortar.

Some are national. Some are regional, or or local in their in their where they let's say serve how they serve customers.

These different aspects just to to describe that that it's not a one-size-fits-all, and Duell's strength is that we have the ability to adapt and create and negotiate a partnership that suits that customer. This agility and this let's say flexibility is something that we also sees is important in our approach towards towards the market.

Of course, in the in the beginning of the whole value chain is the consumer that may either utilize Duell products very very broadly throughout different categories, or maybe only focused on one particular product category. If if the consumer is is into into bicycling, then then then that those are the products that they that are relevant for them, or if they're into into boating, then those are the relevant products for them.

Some are in in several categories. Our our mission is to to optimize this and continuously develop this picture so we can we can improve improve market share.

Then, just to wrap up the the quarter in a few few sentences, that if we summarize quarter one, we had a delayed start to to the winter season, and and this had an impact on on both volumes and and through volume also profitability for the quarter. We have we have some catching up to do.

We cannot affect weather. We can only adapt to it.

The things we are fully in control of, such as our ongoing development programs, progressed very well during the quarter. We have those highlighted.

We have the changes in in warehouse footprint in the Nordics progressing very well. We have the longer-term, the investment projects focused on on on on the e-commerce, the the order channel that our dealers use to to interact and and browse assortment and order from us.

This has this has progressed a lot during the the quarter and is heading now towards the next phase releases here in later in in this year. These are all all on track.

Then the Performance Uplift program I I highlighted here just a just a few minutes ago, which is a a key key focus area for for driving and delivering better performance going forward. That, with those those three items, I summarize the presentation for for today, and then I hope there are some questions from the audience.

Maybe Pellervo has a overview of that.

Yeah. Thank you, Magnus and Kai.

Let's move to the questions part. We have a pretty much twofold of questions.

Other one is focusing on the France operation, and other mainly for the winter season. I think we could start from France operations, since there has been some challenges regarding the product portfolio changes.

What are the measures that we are currently doing in order to get kind of the France business on track in thinking about the both sales and the profitability?

Yeah. Yes.

There's a number of activities, but if I make a little bit sort of a simplified model. Short term, when we had a big difference in revenue in volumes, then of course it immediately created an urgent need to rightsize the cost picture of the company.

These activities are already ongoing, some of them already completed, some of them are in motion. Maybe rightsizing is the right word there.

That of course aims at making quite quick adjustment to protect the profitability in that situation where the top line is shrinking. Then the next step is of course to rebuild and turn around that business equation.

That is then related to the brand assortment and replacing the brands there with others. This is also, let's say, there's some pieces that are one-for-one, and then there is some other expansion of products and product categories in the French business.

Also for the purpose that looking back, we could of course now see some risks materializing that we translate into being maybe a little bit too narrow in the product assortment. Having a little bit broader product assortment in that given market would derisk the business or would increase the resiliency for any changes with one single brand.

These two things: short-term rightsizing focusing on the operating cost; secondly, rebuilding, turning around the business, and rebuilding with a stronger brand portfolio.

Very good. Could you elaborate some magnitude of the change of what came from the brand changes, and what is the kind of the estimate when we are expecting to get back on track to the growth path in France?

The changes are quite material. I think we said four around €4 million for the fiscal year '25.

Then of course that effect then trickles down to when we do the comparison now this year versus last year. Then in terms of turnaround, some of them are quite short actions, like rightsizing cost elements that those kind of actions we are able to do on a quite quick time horizon.

Then in terms of introducing new brands, transforming that, then that's more a process of months. I would say we expect that this fiscal year will be needed in order to do this kind of transition.

It's not something we do within weeks or one quarter. Also from the point of view that the market also in France has various seasons, and various products are in different demand and volume throughout the season, so that's also why that we have to look at this more on a year-to-year basis rather than a quarter-to-quarter.

Okay. Then what comes to personnel, are there legislation obstacles to make any changes in France?

How do you—

Every country has labor legislation, and they're not identical. Also in France, it's possible to make changes, and we have made changes.

The key point maybe here is that we operate in five five European countries, and now I'd say that's where we have, let's say, bigger operations like warehouse, etc. In all the countries where Duell operates, we have to relate to the local legislation what comes to labor law, etc., including France.

Very good. If we exclude France operations thinking about the Central European business, is that growing if we take the France operations off?

I can't say top of my head. I think for quarter one if you open up Central Europe business, of course there are various seasons there, but just to give a few highlights there, we are growing in Benelux.

This is a market where we are succeeding quite well at the moment. We're growing in UK.

Maybe we should also reflect there that the market, if you look at for example motorcycle registrations, it's not a tailwind kind of sailing in the market right now, but we're still improving. This of course shows that Duell and its subsidiaries is able to do the right things and serve customers in a way that we can take market share even in difficult times.

This is good. Then when it comes to the bigger economies in Europe, Poland, Germany, France, then once we talked about France, but there are always some variations quarter to quarter.

Overall, our business in Central Europe is growing, and this is what we can see, particularly if you take a last 12-month perspectives, etc.

Okay. If we jump from Central Europe to Nordic countries, how has the markets developed if you think separately Finland, Sweden, Norway?

The Baltics we could actually include here, and according to different categories, could you comment

a little bit about that? Maybe we need to make the small asterisk in the comment here that looking at a single quarter particularly in this period of the year where weather conditions are really really key to many things, then particularly the winter categories.

I touched on it earlier, we could see the winter season starting in Norway, where the snow arrived up there in the north of Norway quite early. Then of course the northern parts of both Finland and Sweden, once the snow arrived, the season opened.

Now if you look at the present which is not within the reporting period, but today, of course the snow situation is different, particularly actually it's better in Sweden than in Finland at the moment, especially if you look at the mid-level countries. You compare Östersund in Sweden snow situation to, for example, Jyväskylä or well, this morning I read that the snowcross Finnish Championship series, the first event in early February in Nivala is cancelled due to snow situation in Nivala at the moment.

This of course unfortunate for that sport, but it's a good picture of how sensitive the weather situation is to the demand picture. Now overall to the question, in the quarter, then the winter categories are let's say it's their time to shine in this part of the year.

Then the demand picture is kind of the key. Overall, Nordics, the demand picture is best in Norway, second best in Sweden, and most challenging in Finland.

Now I'm talking let's say more the macro level. Of course, yeah, this is how we see it in our business.

Okay. If we keep us still in the Nordic countries, what kind of explains retailers in these countries?

Is it the high inventory levels at the dealers are having, especially what comes to winter season, since last year the season was pretty challenging as well, or is it more based on daily sales?

Depends a little bit on which dealer you consider. I would say, my answer would be both.

Why do I say like that? Let me explain.

When we see the situation and we talk to let's say dealers who carry stock, who do preorders, who maintain stock in inventory in their own stores, then yes, we hear a lot about this kind of comment you mentioned, that, "Well, I have some leftover from previous year, so that I want to clear that first." This is natural.

We also see a similar dynamic with the customers that don't carry stock, for example, e-commerce and the kind of dropship type of equations there. This of course then tells the picture that the demand side, that the consumer is not spending the money.

Then and I think this maybe the big picture we see here is that everything starts from that, how keen is the consumer to spend their hard-earned euros, or kronas, or pounds, or whichever currency on the kind of products that we offer. Then after that, it's a question about is the customers' need fulfilled through a stocked product in our dealers' inventory or is it trickling down to generating new business for us.

Okay. Good.

Then what comes to the size of let's say the winter segment comparing Finland and Sweden, are those equal, or is other one clearly higher or bigger than the other one?

No, the exact the exact numerics of this is is a level of detail we don't disclose between categories and markets. On a on a broad market, I would say although there are differences in these in these two markets, for example, in in Finland snowmobile riding is more of a trail riding tradition, and let's say this has relates also to legal frameworks, what's allowed, whereas in Sweden the the freeriding, the the deep snow freeriding is is quite popular, it's also has a little bit of a different customer clientele.

In both markets, Sweden and Finland, there's a strong snowmobile culture. Maybe maybe an additional twist that we see in the Finnish market which is not so equally profound in in Sweden is the the link to tourism.

This so-called snowmobile safari services that are quite quite widely offered in in the Finnish Lapland, which again seems to attract the movie stars and and and the rest of us as well, when we have when we have time off.

Very good. Yeah.

Thinking about the Nordic market share, what is our estimation? Have we won some market share, or have we lost something?

Again, without exact numerics on this, and of course with an increasing customer preference towards e-commerce purchasing through web stores, then it gets actually increasingly difficult to track that did I now purchase from a domestic company or did I purchase from a foreign company, and actually the consumer may not actually be considered about that at all if they focus on the product. Of course, we recognize that there is competition, and competition is increasing throughout Europe.

We are a challenger in the Central European marketplace, and overall, the industry is not experiencing a strong growth wave at the moment in terms of demand. Of course, this means that every competitor we can name is looking to pick up business in regions they haven't before.

When we look at Nordics, we are maybe more on the defensive side there. We have clearly the biggest market share in Nordics, and others look at it.

Then it's the opposite in other markets, such as Germany or Benelux.

Good. Thanks.

Then we have one questions about financials and mainly on currencies. As the US dollar has weakened, do we see some kind of tailwind boost in the profitability for Q2, 3, and 4, and are these kind of already taken into the purchase prices?

Of course, we cannot really speculate about the future, but we, of course, follow what's going on and are updating prices all the time with currencies that are on the market right now.

Very good. Thank you.

I think we have now ending the webcast and go through the questions. Magnus, please summarize the Q1 and take up the most important actions that we are taking now and moving forward.

Thank you. Thank you, Pellervo.

I'll I'll a little bit mentally revert to to the the summary page. A a challenging quarter in terms of delayed start of of the of the of the winter season, and that's just external step that we had to adapt to.

From that, we but we stayed focused on on on putting a lot of attention to the changes, the development, the the things that we can can be in control of, and can drive. We had the the right progress on on all of those things as as we set out to do.

Moving into into the rest of the year, this is we move into we move into the rest of the year with with confidence on on the rest of the 2026 fiscal year. Of course, I want to thank everybody for for participating here today, and and wish everybody a continued great great day.

Thank you, and we will come back then with the Q2 financial report in early April, and we will meet then again. Thank you very much, and have a nice day.

Thank you.