Good morning, everyone, and welcome to Pierce Group's presentation of our Q1 results for 2026. I'm Göran Dahlin, CEO of Pierce Group, and I'm with Fredrik Kjellgren, our CFO.

Thank you for joining us today. Today, we will begin with a brief recap of who we are and where we stand in the European market, followed by our recap of our transformation program, Pierce 2.0.

Then we will go into a summary of our financial performance in the quarter. Then we will follow that with a look ahead to our outlook and growth drivers for the coming quarters, and we'll close with a Q&A session.

We are Europe's number one online destination for motorcycle gear and equipment. Pierce was literally founded in a garage in 2008 by two motocross enthusiasts.

The company has been successful and growing for a long period and developed into European leader in e-commerce platform for motorcycle, snowmobile gear, parts, and accessories. Post-COVID, there was a tough period, but we're now back to growth and back to profitability.

We operate the online stores 24MX, XLMOTO, and Sledstore. And 60% of our turnover is done with off-road riders, 35% with on-road riders, and 5% with snowmobile riders.

While on-road is 90% of the total market. That means that we have a very strong position in off-road, while we have a challenger position in on-road.

We aim to grow in all our segments, but naturally the largest growth opportunity is in on-road. We operate locally adapted websites in 19 European countries, soon to be 28.

We turn over 1.8 billion SEK, and we report 3.2% EBIT last 12 months Q1 2026. We have approximately 280 employees spread over Stockholm, Szczecin in Poland, and Barcelona.

Pierce is listed on Nasdaq since 2021. We have the broadest and most differentiated product assortment in our industry, including one of the highest shares of private label.

We offer more than 200,000 articles to more than 1 million customers across Europe. We started in Sweden, but we're now the true and the only pan-European company in the industry, with 70% of our turnover being done outside the Nordics.

E-commerce penetration varies across Europe and remains higher in the Nordics and parts of Western Europe, while still lower in Southern and Eastern regions, creating room for continued online shift. Within our categories, e-commerce penetration is higher in off-road and lower in on-road, where the market is larger, but still more under-penetrated online.

Overall, the niche is well suited for e-commerce, where we can offer superior selection and availability compared to physical stores. The rider base continues to grow long-term, and electrification we believe will further broaden the customer base by lowering entry barriers with easier handling, less noise, lower maintenance, and improved accessibility in urban environments.

This will attract younger riders and new consumer segments. A word on our logistics, because we have a truly unique logistics setup for our industry.

We have one of the largest warehouses in our industry centrally located in Europe in Western Poland. We have 30,700 square meters, which provides ample room for growth.

There we stock more than 60,000 articles, and we have a deep buffer capacity also, which is very important in our industry where the leading brands have limited logistic capability. This means that we in a superior way can serve our customers with 20,000 orders per day that we pick and pack within 24 hours.

We also have a very efficient setup with Pierce dedicated long-distance haulers that both deliver to national injection points for last-mile deliveries to our customers, as well as pick up refill and cross-dock orders from our suppliers. Looking at the competitive landscape, it's quite fragmented.

It consists of five main segments. As we can see to the table to the right, we are one of the largest retailers in our industry, and we are also the only true pan-European specialist with local sites, language, payment options, customer service, and delivery partners across our markets.

Most other players are strong local champions focused on their home market, often primarily in on-road and generally with a relatively low private brand share. Several are financially owned, which could facilitate future consolidation.

Overall, the market structure creates a clear opportunity to build a significantly larger pan-European category leader with a scale to stock a wide assortment, offer superior availability and delivery times, as well as strengthening the private brand offer, improve purchasing power with key suppliers, and also unlock very meaningful back-office synergies. Then I would like to spend a couple of minutes on talking about Pierce 2.0.

Pierce 2.0, that's our transformation journey. As I said, we started in a garage and was successful and fast-growing company.

Following the COVID period, however, the business entered a more challenging phase. Declining demand, pressure on margins, and substantial losses followed.

I joined Pierce in Q2 2023. Shortly thereafter in Q3 2023, we launched Pierce 2.0 with two clear priorities: return to profitability and return to growth.

The company was weighed down by a cost base that was too high, decision-making was slow and cumbersome, caught in layers of hierarchy and unnecessary complexity. To address this, we initiated a major reorganization reset in Q3, Q4 2023, simplifying the structure and significantly reducing the white-collar headcount.

This was made possible by introducing a new, more lean operating model with commercial teams, each responsible for a defined business area with real business ownership and power to make decisions and expected to move fast, take risk, and learn from mistakes. At the same time, we took a hard look at our technology platform, and we concluded that the existing tech stack was not fit for purpose.

It was underperforming, unstable, and lacked the scalability required. As a result, we made the tough decision to replace four of our core IT systems, including our warehouse management system and e-commerce platform.

Again, this was a difficult decision. We knew it would be both costly and time-consuming, but also absolutely necessary.

We simply had no alternative. Alongside this, we evaluated our private label portfolio and concluded that sales were spread across too many small brands, making it difficult to invest effectively in brand building.

Some brands also suffered from a weakened brand perception due to inconsistent product quality in the history and the lack of clear assortment and brand identity. We therefore simplified the portfolio from 73 brands, focusing on Raven in gear, expanding into the large but highly competitive on-road segment, and Proworks in parts and accessories, while we are keeping Course as a tactical brand.

This has been quite an effort. We have migrated several thousands products and replaced and launched several thousand new ones.

We have partnered with leading designers to strengthen the overall brand and product offering. While private label growth has lately not matched the pace of external brands, we have taken the right strategic steps and remain confident that sales momentum will accelerate over time.

We spent almost all 2024 cleaning up inventory through targeted sales activities for slow-moving goods and more restricted buying. We also made a SEK 44 million write-down of obsolete inventory, mainly related to older stock that we judged could not be sold.

This initially held back growth as we cleared out slow-moving inventory, but we began to recover once we rebuilt the assortment in Q4 2024, and we aim to take the position as a true specialist in our industry by building a wider and deeper assortment than anyone else, combined with very competitive delivering lead times. Since Q4 2024, sales has grown 16% despite the challenging market, clearly gaining market share.

This growth, combined with a stepwise reduction in white-collar headcount amounting to 40% now versus Q2 2023, has resulted in a 90% increase in sales per white-collar employee, demonstrating the efficiency gain of Pierce 2.0 program, as well as the scalability of our business model. We reported an EBIT of -69 million in 2023.

Since then, we have turned the business around and have been profitable in all quarters except for a setback in Q1 2025. Adjusted EBIT improved to 25 million in 2024, 45 million in 2025, and the last 12 months, we have reached 59 million million.

This is despite transformation costs related to our IT stack, which was 10 million in '24, 29 million in '25, and 26 million in the last 12 months, mainly related to the replacement of our core IT systems. This is primarily external consultants and temporary double licensing during implementation that cannot be activated in the balance sheet.

At the same time, the underlying business has strengthened. The customer base has grown, customer satisfaction and retention has improved, and employee net promoter score has increased significantly.

Now we slowly approach the end of this program, and we are now moving into the next phase with a stronger platform and a more scalable operating model. We are in a position to expand into new markets and categories, and to explore consolidation opportunities in a fragmented market.

Now we will walk through our Q1 financial performance. We saw a strong improvement in adjusted EBIT during the quarter.

In Q1, adjusted EBIT came in at 2 million SEK compared to -11 million SEK last year. This despite approximately 6 million in temporary transformation-related costs.

We should also say that we report 6 million in exo costs this quarter, but this is not the transformation costs. It just happens to be the same amount.

Looking at the last 12 months, adjusted EBIT reached 59 million or 3.2% of net revenues, even while absorbing 26 million of transformation costs. We are stepwise moving in the right direction towards our mid-term financial targets of an EBIT of 5% to 8%.

On the top line, we continue to grow despite the challenging external environment. Q1 sales grew 5% year-over-year or 10% FX-neutral, supported by improved stock availability and strong marketing execution.

Over the last 12 months, FX-neutral growth was 14%. Weather conditions had we believe, overall, a slightly negative effect of the quarter.

Q1 is the most weather-sensitive quarter of all for us. In the Nordics, conditions were very supportive, particularly for Sledstore, while Europe experienced the coldest January and February in 16 years, and there we don't have Sledstore.

We only have 24MX and XLMOTO, and they were quite negatively affected in January and February. Encouragingly, weather conditions improved in March, which helped demand to recover towards the end of the quarter.

At the same time, the broader macro environment remains challenging. This goes without saying, with continued geopolitical uncertainty affecting consumer sentiment.

With this backdrop, we believe that we continue to take market shares. Moving to our margins.

Contribution margin, which is margin after direct cost, remained stable year-over-year, supported by an improved marketing efficiency. Gross margin declined 1.3% percentage points, mainly due to higher competitiveness in the market.

However, this was offset by better conversion and lower marketing spend as share of sales. Our focus remained clear: driving absolute contribution profit growth while maintaining healthy gross margin levels over time.

We also continue to improve cost efficiency across the business. Despite continued growth and ongoing transformation activities, operating expenses decreased to 16.4% of sales, an improvement of 1.5 percentage points year-over-year.

This is primarily driven by the efficiencies from the Pierce 2.0 program. As mentioned earlier, Q1 still included around 6 million SEK of temporary transformation costs related to the rollout of the new IT stack.

These costs will gradually phase out, creating a positive EBIT effect going forward through both lower transformation costs and lower depreciation and amortization. Part of the previously communicated expected 30 to 40 million EBIT improvements post-final system launches has already been realized.

Remaining, we expect a further annualized EBIT step-up of approximately 20 to 30 million once the two remaining large IT systems have been fully launched. We expect that to happen during first half-year of 2026.

Finally, we conclude that we maintain a very solid financial position. At quarter-end, cash amounted to 273 million, in addition to an available 150 million SEK credit facility.

Inventory levels were broadly stable year-over-year, and we expect them to remain at these levels to support continued growth going forward. Looking into some of our KPIs, private brand share over the last 12 months was 35% compared to 38% a year ago.

The decline in share is mainly mix-driven, as external brands has grown strongly. In absolute terms, private brand sales remained solid.

We launched a large number of new products in 2025, and ramp-up has been taken longer than expected. We continue to invest strategically in private label, and we have high ambitions to accelerate growth, but we also need to remain realistic about the time required to build new, successful products and categories.

At the same time, we're unlocking significant growth within our external brand portfolio by improving availability and assortment depth. This remains an important growth driver.

As we grow both private brand and external brand, we do not expect major structure shifts in private brand share long-term. To the right, we have our Trustpilot scores.

We rank one of the highest in our industry. We have increased slightly from 4.3 two years ago to 4.4, and we remain at 4.4 in a stable manner.

Looking at our customer base, one of our most important KPIs, of course. It's very satisfying to see that we continue to grow our customer base, and this is both because we manage to attract new customers, but we also managed to increase our customer retention.

We also see a strong increase, or a good increase, in the number of orders, while average order value remains fairly stable over time, and naturally affected by FX also. I hereby hand over to Fredrik Kjellgren, our CFO.

Thank you, Göran. If we now zoom in a little bit on gross and contribution profit margins.

The gross profit and profit after variable cost increased year-over-year despite the very strong headwind that we had from FX translation. Contribution margin, that is the margin after variable costs, remained stable compared to last year, and profit increased in line with sales.

During the period, the company had a high level of activities to support sales. This involved actively positioning of sales prices to support commercial activities.

The activities put pressure on the gross margin. However, the commercial initiatives also drove increased competitiveness, thus reducing the need for performance marketing.

In addition to the agile management of pricing and marketing, we drive initiatives to improve the efficiency of our performance marketing. In total, the pressure on gross margin was offset by the improved marketing spend, resulting in a stable contribution margin.

Looking ahead, we expect market to remain price-sensitive, our focus is on maximizing contribution profit in absolute terms. I.e.

we aim to be price-competitive, but not the cheapest in the market. Now, let me give you some additional context to the adjusted EBIT this quarter.

The Q1 adjusted EBIT increased from -11 million SEK in 2025 to a positive 2 million SEK in 2026. In order to fully capture the underlying trend, it's also good to be aware of the other unusual items impacting the adjusted EBIT.

Göran described the transformation journey of Pierce. The transformation involved implementation of new SaaS systems, overlapping license fees, and costs related to external consultants.

Transformation costs, which are not classified as items affecting comparability, impact EBIT with around 6 million SEK in the quarter. Excluding these costs, the adjusted EBIT would have been approximately 8 million SEK for the quarter.

The last 12 months Q1 adjusted EBIT increased from 7 million SEK in 2025 to 59 million SEK in Q1 2026. Applying the same logic with exclusion of unusual items related to transformation cost would bring the annual adjusted EBIT to 85 million SEK for the last 12 months.

We expect the transformation costs to decline significantly once a new tech stack is fully implemented during the first half of this year. Opex costs decreased by 3 million SEK year-over-year to 69 million SEK.

This was despite the 6 million in transformation expenses that was included in the opex. Since Q3 2023, we have right-sized the company by reducing our white-collar workforce by more than 40%, while increasing net revenue by 15%, resulting in roughly 90% higher sales per white-collar FTE.

This demonstrates the scalability of our model and the efficiency gains of streamlining processes, empowering teams, reducing bureaucracy, and empowering teams to make faster decisions. Looking at our net working capital and the development.

Our net working capital has increased since the exceptionally low levels that we saw back in Q2 2024. This is mainly the result of our efforts to strengthen the assortment and improve product availability, which are key enablers of growth.

As of this quarter, the year-over-year development of net working capital has stabilized as we meet relevant comps. The improved net working capital in Q1 versus last year is primarily driven by improved inventory turns, but we also had a contributing factor from improved supplier payment terms as well.

We still see opportunities of growth by further strengthening of the assortment and improving availability, but we expect pretty stable net working capital in relation to sales going forward, as we balance strong availability with disciplined inventory management. Our focus remains on continuously improving our purchasing methodology to drive higher efficiency, keeping the stock fresh and healthy by acting early on slow-moving items, while maintaining the right levels of inventory to support customer satisfaction and sales momentum.

With that, I hand it over back to you, Göran.

Thank you, Fredrik. Looking ahead, we will continue executing on Pierce 2.0.

We will strengthen our fundamentals by improving customer experience, streamlining operations, and increase scalability. We target completion by the first half of 2026, after which the temporary overlap of systems will fade and profitability will structurally improve.

At the same time, we're entering a new expansion phase. The rollout of 12 localized markets and continued growth in mountain bike and scooter moped categories has begun.

It will broaden our addressable market, creates cross-selling opportunities, and add new revenue streams over time. This will take time to scale, but it will be an important contributor to long-term growth.

Finally, our working direction is to participate in the consolidation of the European motorcycle market. The e-commerce markets remains highly fragmented and is ripe for consolidation.

We are the largest and only pan-European listed player with a scalable platform already in place. We are uniquely positioned to participate and potentially lead the next phase of industry consolidation.

By that, we enter into Q&A.

Hi, Göran and Fredrik. Good morning.

I have a few questions, please. Firstly, we noted this 6 million in item affecting comparability seemingly for consultancy costs.

Could you give us some more explanations for the thoughts behind these investments, and basically what you expect to gain from it?

As we write in the report, you're right, these are primarily consultancy costs related to a strategic project that we have undertaken. We have completed it in Q1.

The purpose was to assess different avenues for growth. Its outcome may support future initiatives.

Right. Okay.

You also mentioned in the report that you saw encouraging momentum in the new mountain bike and scooter moped categories. Do we have any kind of ballpark figures for what you expect this to drive in terms of, if you call it, incremental sales growth?

Are we talking tens of millions of SEK, or is it above 100 million a year, that is?

I would say it will take time to scale. To begin with, we should not have too high expectations.

In the short, it's not in the hundreds of millions.

Right. Okay.

Any effect we've seen in the war in Iran affecting, I don't know, freight costs or consumer spending habits or something that you've picked up on?

Yeah. In some cases, yes.

What we have seen primarily is that some of our suppliers have flagged for increased purchasing prices on plastics and other oil derivatives. There we have tried to put as much orders in as we dare to get the existing prices.

Then we also see insurance cost on freight increasing. That's a minor part of the total cost for freight.

We keep a close eye on this, of course, and we have plans for how to act under different scenarios.

Okay. Another question regards to some kind of trading update.

I know that you don't usually give any guidance here, but speaking of the weather, it seemed like March was better. Could we have any sort of weather update here in the beginning of Q2?

Yeah. Q2 is normally more weather-stable, and we're less dependent on the weather in Q2, Q3, which are our high season, especially Q2.

Having said that, the world is a bit crazy, to say the least. We try actually to just focus on what we can control and work as hard as we can to improve our results.

You're right, the quarter ended a bit better than it started. On the other hand, we were very active with sales activities, and the market was very competitive in January, February, when there was small volumes.

That also explains a part of the gross margin drop that we have had. We had to remain competitive in difficult marketing in January, February especially.

Okay. I think I have one more question if that's fine.

Could we have any update on this IT transformations, how they are ongoing? Presumably the warehouse management system hasn't gone live yet, if I'm not mistaken.

Do you know when that is due, or can you give a due date? Yeah.

We remain with our saying from last quarter that we expect all of this to be done during the first half of 2026, and that is 7 or 8 weeks off, so that ends in the end of June. It's quite imminent.

Okay. Thank you, Göran.

That was all for me.

Thanks.

Thank you for your attention. Fredrik and I wish you a great continuation of the day.

Thank you.

Thank you.