Welcome to the presentation of Q1. I can start to describe it as a very stable quarter.

We are a bit, or I'm a bit disappointed that we still don't see any better markets. I say that it's the longest period ever for me, and we have been on the stock exchange for 30 years, when it's weak markets and unstable every time.

Fortunately, I can say that I'm not the only one that has thought that the market should improve the last 3 years, but it's still not happening. I think as long as we have all this unsecurity about the wars in Ukraine and in Iran now, and also in Gaza before, together with the politics that we have in US right now with, or have had for a while, with tariffs and unsecurity and this, I don't think it will come a quick turnaround.

I'm happy anyhow that we continue to take market shares. We continue grow.

We have quite good growth in US actually. I see that US I would describe as a better market than Europe, which is a surprise in some ways because I was more worried for US than Europe if I go back.

We are 2,800, just about 2,800 employees, 28 countries now. We're selling in a few countries more than that, where we have agents and distributors.

The same three segments as before. This you all knew, I think: Corporate, Sports & Leisure, and Gifts & Home.

If I should comment the markets a little bit, the corporate market is more stable. It's not good, but it's more stable than retail.

I saw some statistic, I think it was last week on clothing in Sweden, and clothing retail was growing with 7%. I thought maybe it will be a turnaround now.

Then come the e-commerce out today or yesterday, -19% in Sweden for March. It was the worst month for e-commerce in a long, long time.

The corporate is more stable. The retail is more tough, and a big part of the distribution and clients in Sports & Leisure and Gifts & Home is, of course, retailing clients, then.

If we look at the quarter, first of all, the currency still have a very, very big impact. The growth in local currencies was 13.2%, which is not really enough to really make good results.

We need a 3-4% higher organic growth to really deliver good and improved net profits and operating margins again. I'm quite sure and confident that sooner or later, we will have that growth because we should remember that we are still in a tough market.

Organic growth 2.9%, and it's here we do everything we can to get that up to 5-6%. If we succeed with that, it will come down to the last line as well.

Gross margin very, very strong, I would say, 50.4% or 50%. Part of the explanation is that we have lower volumes on trading.

We should also remember that Q1 last year, we did not have Cotton Classics that are around on 25%. I think it's a record-high gross margin if we consider that and they are into the figures.

Operating profit, 200 million, just a little bit lower than last year. I think it's a stable result.

I think on most areas we are delivering still much, much better than competition. If you compare the bigger retail brands like Puma, Nike, and so on, it's far better figures.

The cost continued to be high. Two reasons, two main reasons: the ERP system that we change, and that will go on for another year, for another two years.

A lot of this is, of course, extra cost because we're operating two systems right now. I don't know, have we, how many have we implemented in?

How many companies are brand new? France, Netherlands, two?

Yeah. Hopefully it gets smoother and smoother as more companies come through this.

The second thing is, of course, investments we are doing in new markets and also in new warehouses and automations. The really big one going on now is that we open up in Texas.

Hopefully, we are in operation 1st of October. That is a pure investment for the future.

We're not service South US in a in a good way right now as we do in in North, since we are based with the two warehouses we have. We are based in Seattle and in Renton—no, sorry, in Kentucky.

This is the investment in Texas, it's much, much bigger than a normal warehouse investment because we go for full operation same as Seattle with embroidery and automatisation from day one and everything, and it will cost some money in the beginning. I'm very, very confident it will be a good investment.

I think it's around 200 million SEK we invest there now. Then we should not forget smaller investments like open up a warehouse in Ireland in January this year and so on.

We are on a pretty high cost level for for the moment. Which will not be a problem actually if we just can get this 3-4% more growth.

Sales, +6.6%, again, in Swedish kronas, then. Local currencies 13.2.

Promo channel increased 10.8 and retail down 0.9. There we should also remember that Cotton Classics comes into the Corporate, so that's what make it such a huge difference between them.

The growth in promo is, of course, acquisition, but also the new lounge we did that you have behind you of Untamed Movement. Also Cutter & Buck is doing very, very good both in US and Europe actually.

It's not so much maybe to comment this. If we look geographically, in the US, it's minus, and that's only currency.

Enter?

Which one is Enter? That.

Forward. Yeah.

You have an organic grow in US by 7% in local currencies. It's really affected the currency to that.

Sweden, it's nice to be back on a very small growth, which I think is very, very strong sign in this environment. Benelux doing well.

Nordic countries, excluding Sweden, grows as well. Rest of Europe also, and other countries is a little bit down, and there you have the trading.

You can say in local currencies, all regions are growing excluding the other countries that are mainly the trading business. Gross margin, I'm very, very happy with.

I think it's very few companies and competitors that actually report higher gross margins in this environment. We will try to keep it there.

Of course, it can be or will be in the future also if we have quarters where the trading comes up a lot, it's can be down, but I think it's very, very safe as you use all our own brands. External cost up, it's 92 million up, and there we also have a for us positive currency effect.

Actually, the cost increase are even higher if you look at local currencies there. That's mainly it, then.

Operating profit we have talked about. If we look at the different segments, then: Sports & Leisure are improving a little bit, Corporate a little bit down, and Gifts & Home Furnishing is small, small improvement.

We should also remember that for some of the companies, Q1 is an extremely small quarter. Not even the best years, for example, in Orrefors Kosta Boda, it was profitable Q1.

I think this picture will change a lot when we are at the end of the year. Cash flow, I would also describe as very stable, and that's good.

I'm feel very happy for the balance sheet that we have today that give us quite a lot of space for continued growth and investment and also a lot of security that we feel very, very safe in this. Now we probably will have a little bit lower cash flow or worse cash flow in maybe New Year's when Texas come through, because it's not only the investments, we should also build up the stock there.

It's no idea to have an empty warehouse, and that's quite a lot of money, we can be prepared on that. Balance sheet, again, very, very strong.

I would say probably one of the strongest if we compare with competitors in all three segments, with an equity on 50, over 55%. It's, yeah, it's a good feeling, and also it's nice to feel safe, because even if the markets don't improve, if we can keep a decent profit level and this balance sheet, we are in an extremely strong position.

We are, I would say, one of few companies that could be really patient and continue also long-term investments in more tough times. Cotton Classics is, I would say, doing very good.

Implementation of our brands are doing well. We launched them, first ones in September, actually 15th last year.

Came the first catalog out, but then none of our brands were still in their main catalog that are released in January. Now all those plus three new is in their main catalog, which comes out actually in mid-January, and their roadshow is from mid-January to mid-February.

Actually, if you look at the first quarter, it's more fair to say that they have sold our brands for 2, 2.5 months than 3 months. Was it 4% now?

It's already now 3.4% of their total sales is our brands in March. Interesting is also to see that the gross margin on our brands is between 2 and 3 times higher than the gross margin they have on the distributed brands as an outcome, actually, not what we think.

I'm happy with that, and it's also a new CEO in place that we have a good feeling for. Basically, I think we open up for questions.

Någon som vill börja?

Carl-Johan Blomqvist Bonnevier, DNB Carnegie. Looking at the global environment for the moment, obviously stress in lost part of the system, but how do you see it affecting your sourcing opportunities, and have you been caught up in any of the, say, the flow problems that might be out there for the moment?

It's not really any very big effects, but the number of small delays and small problems have, of course, increased. I'm, as I said in the early report, I'm very happy that we also moved a lot of the production in good time to Africa.

If we were as depending on China today as we were 3-4 years ago, then it would be huge problems. Then we see also happening with the freight cost is, of course, a bit worrying.

Oil price, as we talked about in the beginning, will probably, our CDO and buying manager expect if the oil price is on this level, he expect 20% increase on raw material, on polyester raw material, within 6 months. Again, I'm not nervous about that because we have always been able to change our pricing and not be so affected.

In one way, it can be positive if the prices start to increase a little bit for the sales also.

Obviously fantastic gross margins in the quarter, particularly looking underlying. It seems like there is a big, say Craft and Cutter & Buck effect as you mentioned.

Could you describe a little what's going on underlying there? No, but

it's on record levels and I'm very happy with it, but we have a very strong positioning for several of the brands. Like you mentioned, two most obvious is Cutter & Buck and Craft, of course.

I feel very, very confident, and also the new collections like Untamed Movement have been received very, very well in the market, and it also opened up new clients for us. For example, if you take theoretically because we don't have them, but theoretically we can sell Untamed Movement as merchandise to every club whether they are contracted by Adidas, Nike, Puma, or ourselves, because those don't have the merchandise on stock.

Now with the neutral label, it's opened up quite a lot of new markets.

One last as well, looking at the ERP rollout, give us some idea of what you have learned so far from the countries where you have done it, and understand now you are targeting some of the bigger countries in the next 6 to 12 months.

I pass that to you, Göran.

Yes, now we are doing the implementation in the US with Cutter & Buck, which will be made step by step so we don't implement it in one time. We start with implementing one of the warehouses, then the second warehouses, then we also change the financial part.

It's an important step also doing the development of the template that we use. After that implementation, it will be smoother and more cost-effective when we continue the rollout.

If I remember correctly, when we change the ERP system in Cutter & Buck, was it 20 other systems that was affected? It's not, yeah, putting one thing and then you're ready.

Några andra frågor här inne? Då kan vi gå vidare.

Vi har fått en hel rad inskickade frågor till oss. Ja.

When you speak of weak market, what exactly is weak? What is driving this?

Grateful for more color on this and how it affects New Wave's business.

The retail market is, as I said before, especially weak compared with the corporate that are more stable. You have quite, I would say, weak markets and negative, best-case neutral consumers in most of the European countries.

I think the reason for that is again the unstability that creates actually in a politic way today, and also all the wars that have or are going on. The consumer are definitely holding back their spendings.

That I would say that goes for, I would say more or less all European countries. Maybe Switzerland is an exception.

They live in their own life, but otherwise it doesn't matter if you look at UK or Germany or also Nordic countries.

Thank you. What was the gross margin for Cotton Classics in Q1?

Ooh, I don't think I have the figure even, but they were in the past on 25, I think, 24.

We

don't give details on specific subsidiaries.

You said that the rollout of the new ERP system will continue another two years. Will the quarterly costs related to the implementation go up or down in the coming quarter, and what was the impact on Q1 EBIT?

I pass that to one of you.

We don't give details about how much the cost was in Q1, but the costs will decrease in future when we continue the implementations and rollout of the system.

Thank you. Do you see any potential to improve efficiency in Cotton Classics' warehouse operations?

Definitely, but it will take some time, and I think the best thing to do is to actually, which we are looking into, establish a totally new warehouse, because go in with automatisation in the current one would be maybe not a nightmare, but very difficult at least. What we see in forefront is a new Cotton Classics warehouse, probably in North Germany, and then continue with the old warehouse for distribution in the east and Austria and those countries.

Thank you. You maybe already answered this, but in Q4 you gave the underlying margin I asked for Cotton Classics.

Would you care to do it here also in Q1?

Underlying margin.

Same question, but we don't give specific margins for specific companies, but undiluted from the acquisition of Cotton Classics, it was 52.5%.

Thank you so much. Could I please ask what drives the weak Sports & Leisure margins?

What drives what?

What drives the weak Sports & Leisure margins?

Very good question. No, but I think a lot of investments we are doing there is hitting that area, because the Cutter & Buck, where we do the new investment in Texas, is belonging to that segment.

Craft's establishment in US that are quite loss-making in the beginning, is that segment and so on. It's much more investments and costs going on there than it is in Corporate.

It's also interesting because Cutter & Buck is a part of Sports & Leisure because that was classified that way when we acquired it, but today the majority of the sales in Cutter & Buck are Corporate. It's not 100% fair, but most of the investment is in Craft and Cutter & Buck.

Also regarding Cutter & Buck in Sports & Leisure, it's the big currency headwind. There was -13% from currency really, so that of course affects Sports & Leisure most.

We should remember there that Cutter & Buck is one of the most profitable companies we have, both in operating margin, in growth, and so on that perform very well. When you get a hit there such a big on the currency, it's also hitting that segment.

Thank you. How do you view the possibility of obtaining a refund on tariffs in the United States?

Good question. We discussed that yesterday actually, and I think we will try.

I read now that some of the bigger corporation are avoiding it because they are scared of Trump, but I don't think we are so big so we would be in focus, I think we should dare to try. Then we should also remember it's not extremely much money.

If it would be that we would have worse result the last year, to say. We will try to recover what we can, but it's not much.

Of course, it's depending on again that a lot of the goods we have taken into US the last 1.5, 2 years has been Africa, not the countries that have been hitting worst by the tariffs.

Thank you. How do you view the declining Gifts & Home Furnishing linked to the fact that the overall retail share has decreased for several years?

It's the toughest job we have is to turn around that segment, and it's still very, very tough. We try to continue to decrease costs, we try to have higher efficiency in the production, and we try to find new distribution channels.

It's if the headache, some that's the only part in a way where I'm happy if it's a small part.

Thank you. Några mer frågor inlagda?

I think that was it.

Yeah. I maybe can add also to this question about Gifts & Home that if you look at all big acquisitions we have done the last years has been in other areas because we are not happy at all ourselves with Gifts & Home Furnishing.

Okay? Thank you very much.