Bilia Aktie

Welcome to the Bilia Q2 Report for 2026. [Operator Instructions] Now I will hand the conference over to IR, Carl Fredrik Ewetz. Please go ahead.

Thank you for the introduction, and welcome to Bilia's Second Quarter Results Presentation with CEO, Per Avander; CFO, Kristina Franzen; and I, Carl Fredrik Ewetz. We're happy to present a good set of figures, strong cash flow and an even more solid financial position than last year. Here's our agenda. We will start with the current situation in the industry, followed by Q2 numbers, then Kristina will go through the financial situation, and I will conclude with our outlook. So let's start. I'll leave the word to our CEO, Per Avander.

Thank you very much, Carl Fredrik. The improvement in demand we saw in Swedish new car market at the end of quarter 1 has continued in quarter 2. The interest from private customers is also higher for new cars compared to last quarter and last year. In Norway, we had a strong finish in quarter 4 due to changes of tax situation. And because of that, January and February this year had weak order intake on new cars. In this quarter, the demand has picked up a lot compared to last quarter. In Western Europe, demand remained stable throughout the quarter. Many of our brands have strong campaigns, big discounts and attractive private leasing offers. Because of this, our feeling is that we are experiencing a push market in all our countries. The demand for used car in our countries was on a normal level, except in Norway.

In Sweden and Western Europe, prices for electric cars have stabilized on a slightly lower level, and therefore, we saw better demand in these countries for fully electrical used cars. In the Norwegian market, there is a wide selection of used cars, but our stock situation is on a balanced level, both in Norway and in our other countries.

There was a good and strong demand in the Service business in Norway and Western Europe with good booking times. In Sweden, we saw slightly better activities compared to the previous quarter, which was a little bit on the low side. Part of the explanation is some years of lower new car sales and export of young used cars. The total car market in Sweden 2025 was almost 20% lower compared to an average market in the last 10 years. During this period, there has been a shift in the car population to more older cars.

Net turnover was somewhat higher compared to last year. We reported result of SEK 411 million with a margin of 3.8% compared to SEK 348 million last year. We had mainly higher profitability in Sweden and Norway coming from our Service business. In Western Europe, the higher result is related to the used Car business. Earnings per share increased to SEK 2.50, improvement of 20% compared to last year.

On this slide, you can see the quarter 2 profitability from 2020 to 2026 in each of our countries. On the left-hand side, you can see the stable performance in Sweden. On the right-hand side, you can see the Western Europe, the best quarter 2 ever. In the middle, you can see Norway performing better and better since a few years ago. On this waterfall chart, you can see the different business areas. As you can see, we improved the earnings in the Service business significantly. I will also like to clarify for the Fuel business, the quarterly results included a negative one-time item related to tax changes for fuel.

We are moving over to the important Service business. Our Service business represented 70% of the earnings in the quarter, and we improved the result and the margin. We reported a result of SEK 323 million compared to SEK 252 million in the same period last year, and the margin increased from 10.4% to 12%. The main reason for this is improvement of profitability in Sweden and Norway. We also had a positive organic growth in the group of 5%. There are several reasons for the higher results in Sweden and Norway. One is higher efficiency. Another is more delivery of new cars. The third, we had 1 more working day in Sweden and Luxembourg and another is our Dismantling business performed well.

The order intake on new cars adjusted for acquired and divested operations was 29% higher compared to quarter 2 last year. As I mentioned, we have seen better activity in all our countries. For the Car business, we reported a result of SEK 141 million compared to SEK 136 million last year. The profitability for cars was related mainly to Sweden and Western Europe. For used car, we reported a result of SEK 65 million compared to SEK 61 million here. As I mentioned in the beginning, the used cars is on a good and balanced level in all our countries. Reason for the earnings were Sweden and Western Europe. But in Norway, the result dropped due to aggressive pricing.

Like we said in quarter 1, prices of fully electric have stabilized, and we can now see slightly increased demand. We have increased our underlying backlog of new cars by approximately 4,700 units. And today, we have 16,600. This is in a historical perspective, a high level. As we mentioned in quarter 4 and quarter 1, some of our brands have launched interesting EV models with long range, attracting lots of interest from our customers.

Okay. Over to Kristina and the financial situation.

Yes. Thank you, Per. For this quarter, we reported a strong operating cash flow of SEK 546 million generated by the underlying business. As a result, cash flow for the first 6 months was broadly in line with the corresponding period last year. As we have highlighted in previous presentations, cash flow remains a key focus area for us and will continue to be a priority going forward as well.

Our net financial expense amounted to SEK 79 million during the quarter, representing an improvement of SEK 5 million compared with the same period last year. This improvement was primarily driven by lower interest expenses on our interest-bearing debt. For the first 6 months, net financial expense was SEK 27 million lower than last year, again, reflecting reduced interest expenses on interest-bearing debt, but also higher income from associated companies. At the end of the quarter, net debt, excluding IFRS 16 liabilities amounted to just below SEK 2.4 billion, approximately SEK 100 million higher than year-end.

Our net debt to EBITDA, again, excluding IFRS 16, was 1.3x, unchanged from December 2025 and an improvement from 1.4x at the end of the first quarter. Consequently, we remain well within our financial target of maintaining a leverage ratio below 2x. At quarter end, approximately SEK 660 million of our available credit facilities were utilized. Total committed credit facilities now amounts to SEK 3.1 billion following the signing of an additional SEK 800 million facility with our existing banks. This facility serves as a liquidity backup, providing additional financial flexibility to support future growth opportunities and also to navigate potential uncertainty in the global economy.

During the quarter, we paid the first installment of the 2026 approved dividend amounting to SEK 138 million, corresponding to a total dividend of SEK 6 per share. This dividend is then distributed in 4 equal installments with the fourth and final payment scheduled for January 2027.

So in summary, our financial position remains strong, supported by solid cash generation, moderate leverage and a good liquidity. With that, I hand over to you, Carl Fredrik.

Thank you for that, Kristina. And starting with our Service business. I repeat what Per said, our Service business represented 70% of our operating profit in Q2. We continue to identify opportunities to enhance efficiency across our Service business while further strengthening the customer experience. Over time, higher new vehicle registrations contribute to a larger installed vehicle base, creating additional demand for maintenance and repair service. So we anticipate a stable market environment for the Service business in the next quarter.

Moving over to the Car business. The demand for used cars was slow at the beginning of the year, but has since picked up. We expect demand for used cars to remain at a rather stable level, this except Norway in the coming quarter, especially for electrical vehicles. This comes as an effect of the fact that prices for used electrical cars have stabilized on what we believe attractive level. Our used car inventories are at healthy levels and our intention is to keep that status in the coming quarter.

Looking at new car sales, demand from corporate customers has remained consistently stable, and we expect this trend to continue. Hence, a continued macro uncertainty, we do see continued decent demand among our brands in the coming quarter. The introduction of several new generation electrical vehicles with extended driving range is expected to broaden customer appeal and contribute positively to volume in the coming quarter. We remain committed to strengthening both profitability and operational performance across our existing operations. The efficiency program launched last year continues to progress according to plan and is expected to deliver the results as previously communicated. Maintaining a strong focus on profitability, cost control, disciplined capital allocation remains a key priority throughout the organization, like Kristina also said earlier.

So we are very proud and happy to present such a solid set of figures, but we would like to emphasize that the current environment in the industry is very tough, and our organization works hard to deliver. Strong together, combined with an attractive car brand portfolio, we are well positioned for the future. We remain humble in our outlook, but are encouraged by our ability to continue outperforming the market. Through disciplined execution, a strong customer focus and the dedication of our employees, we believe we can continue to perform well compared to the overall market. This finalizes our second quarter presentation, and we can now open up for questions.

[Operator Instructions] There are no questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much for listening. It seems like it was crystal clear. So we're grateful for that. And best wishes for a happy and relaxing summer. Goodbye.

Goodbye.

Bye-bye.

Welcome to the Bilia Q1 report for 2026. [Operator Instructions] Now I will hand the conference over to IR, Carl Fredrik Ewetz. Please go ahead.

Thank you for the introduction, and welcome all to Bilia's first quarter results presentation with CEO, Per Avander; CFO, Kristina Franzen; and I, Carl Fredrik Ewetz. In addition to releasing our Q1 report today, we're also holding our Annual General Meeting this afternoon. And therefore, we have the pleasure of having both our Deputy CEO, Stefan Nordstrom; and our Managing Director of our Norwegian operation, Frode Hebnes, joining us today for the Q&A session.

We're happy to present the good results and a solid financial position. And here is our agenda. Per will start with the current situation in the industry, followed by Q1 numbers, and Kristina will go through the financial situation, and I will conclude with our outlook.

So by that, I leave the word to our CEO, Per Avander.

Thank you, Carl Fredrik. The quarter started with low demand on new cars in Sweden, but improved later in the quarter. We also saw signs of better interest in new cars from private customers. In Norway, we had a strong finish in quarter 4 due to the changes of the tax situation. January and February this year had a weak order intake on new cars, while March was much better. In Western Europe, the demand remained stable throughout the quarter. Currently, many of our brands have strong campaigns, big discounts and attractive private leasing offers in all our countries.

The demand for used car in our countries was slow in the beginning of the quarter. But we saw signs in March of slightly better activity. Prices for used electrical cars have stabilized on a slightly lower level. And therefore, we saw better demand in Sweden for fully electrical used cars.

As I have mentioned in the last 2 reports, the Swedish government terminated all incentives for electrical vehicles approximately 3 years ago, and we expected a huge number of incoming used electrical vehicles in quarter 4 and quarter 1. Now we have passed the peak, and we can conclude we have handled the situation in a good way. In Bilia, the stock of used car is on a good and balanced level in our countries.

When it comes to the Service Business, this quarter is similar to previous quarter. There was a good and strong demand in the Service Business in Norway and Western Europe with good booking times.

In Sweden, we saw slightly weaker activities with somewhat lower booking times. Part of the explanation is some years of lower new car sales and export of young used cars. The total car market in Sweden 2025 was almost 20% lower compared to average market the last 10 years. During this period, there has been a shift in the car population to more older cars.

Next slide, please. Net turnover was somewhat lower compared to last year. We reported result of SEK 382 million with a margin of 4% compared to SEK 344 million last year. We had higher profitability in Sweden and Norway. In Western Europe, touch lower results related to the Service Business, but still a good margin of 6.1%. The main reason for the higher result in Sweden relates to the Service Business and for Norway, the new car business. Earnings per share were SEK 2.11 compared to SEK 1.61 last year.

Next slide, please. On this slide, you can see the quarter 1 profitability from 2020 to 2026 in each country. On the left-hand side, you can see the strong performance in Sweden. And on the right-hand side, you can see Western Europe still on a very strong level. In the middle, you can see Norway performing better since a couple of years ago.

Next slide, please. On this waterfall chart, you can see the different business areas. We improved the earnings in the Service Business and within the new car business. I would also like to mention the improvement in the Fuel Business, which relates to a quick change in the oil price during the period.

Next slide, please. We are moving over to the important Service Business. Our Service Business represented 79% of the earnings in the quarter, and we improved the result and the margin. This was the best quarter 1 ever in the history.

We reported result of SEK 328 million compared to SEK 310 million in the same period last year, and the margin increased from 12.2% to 12.4%. The main reason for this is Sweden with an improvement of profitability and with a high margin of 14.2%. We also had a positive organic growth in the group driven by Norway.

There were some -- same number of working days in all our countries during the quarter. There are several reasons why we report a higher result. One is higher efficiency, another is more deliveries of new cars and the third is better performance of our tire and wheel storage operation.

Next one. The order intake on new cars adjusted for acquired and divested operations was 14% higher compared to quarter 1 last year. As I mentioned, we have seen a slightly better activity in all our countries, especially towards the end of the quarter.

For the Car Business, we reported a result of SEK 65 million compared to SEK 57 million last year. The profitability for cars was related mainly to Western Europe and Norway had the best improvement in the quarter.

For used cars, we report earnings of SEK 38 million compared to SEK 55 million last year. As I mentioned in the beginning, the stock of used car is on a good and balanced level in all our countries. The reason for the lower earnings was due to lower deliveries of used cars during the quarter. Prices of fully electrical cars have stabilized, and we could see an increased demand going forward.

We have increased our underlying backlog of new cars by approximately 3,000 units. And today, we have 17,500. This is in a historic perspective in a high level. As we mentioned in quarter 4, some of our brands have launched interesting new electrical models with long range, attracting lots of interest from our customers.

Kristina?

Thank you, Per. So during the quarter, we reported a lower-than-normal operating cash flow of SEK 20 million. This lower cash flow was explained by an increase in inventory of new cars and an increase of trade receivables compared to year-end. We consider this increase to be a normal fluctuation in working capital for our businesses and expect that operational cash flow for the coming quarters will be on a normalized level again.

Looking at the past 6 months, the operating cash flow was in line with last year, amounting to just below SEK 700 million compared to around SEK 750 million last year. As said in previous quarters, cash flow is a key focus area for us and will continue to be so for the future as well.

In November last year, the Board of Directors took a decision to repurchase own shares to a maximum of 1,250,000 shares at a maximum value of SEK 150 million. During this first quarter, around 470,000 shares at a value of SEK 59 million has been repurchased. For the program in total, we have reached 917,500 shares at a total value of SEK 116 million, which equals around SEK 126 per share. And with that, we are also concluding the program, which ends before the Annual General Meeting.

At the end of this quarter, we utilized around SEK 1 billion of our credit facilities, which in total amounts to SEK 2.3 billion. Our financial net amounted to SEK 78 million, which was SEK 22 million lower compared to last year. This improvement related to lower interest expenses attributable to interest-bearing debt.

At the end of the quarter, our net debt, excluding IFRS 16, amounted to just below SEK 2.6 billion, which was some SEK 300 million above our net debt at the end of last year. This increase relates to the increase in inventory of new cars and trade receivable, as I talked about earlier. Still, our ratio of net debt in relation to EBITDA, excluding IFRS 16, was 1.4x compared to 1.3x at December 2025. Consequently, that means that we are well in line with our financial targets to have a ratio not exceeding 2.0x, and we do have a stable financial position at the end of the quarter and going forward.

During this quarter, we have made the fourth and last payment in relation to the dividend for 2025, which was SEK 5.60 per share. The dividend has been paid in 4 installments where the final fourth installment was made in January.

In this afternoon, we will, as Carl Fredrik mentioned in the beginning, have the Annual General Meeting for Bilia AB. The financial target for the group is to distribute at least 50% of the earnings per share to the shareholders. And the proposal from our Board of Directors to the Annual General Meeting is to have a dividend of SEK 6 per share for 2026. That is an increase with 7% compared to the dividend proposed paid for last year. And the proposed dividend comprised of 73% of the earnings per share for 2025. And likewise, last year, its proposal is that it should be paid in 4 installments for the last day. So let's see what the decision will be from the Annual General Meeting in the afternoon.

So I believe that summarizes our financial position, and I will leave the word to you then, Carl Fredrik.

Thank you for that, Kristina. And we're moving over to the outlook. And first of all, I want to emphasize that we continue to focusing on improving both profitability and operational efficiency in our existing operations. Our efficiency program implemented last year is going according to plan and will be fully achieved as we have earlier communicated. Profitability, cost discipline and capital allocation are always core priorities across the entire organization.

Then moving over to the Car Business. As Per mentioned, the demand for used cars was slow in the beginning of Q1, but showed a pickup towards the end of the quarter. We expect demand for used cars to remain at a rather stable level in the coming quarter. Also, prices for used electrical cars have stabilized on what we believe attractive level, while demand in Sweden for fully electrical used cars should be slightly better in the coming quarter. Our used car inventories are at healthy levels, and our intention is to keep that status in the coming quarter.

Looking at new car sales, while purchasing activity among corporate customers has been stable for long and will remain so, we believe, interest from private customers picked up during the late Q1 and into Q2, supported by a strong and increasingly competitive market offering from some of our brands, especially some new level electrical vehicle introductions with long ranges are expected to support volumes and provide attractive new alternatives for customers in the coming quarters.

So to conclude, we do see some light at the end of the tunnel and hope we will be able to slightly up the deliveries of new cars in the coming quarter.

When it comes to the Service Business, I repeat what Per said, our Service Business represented 79% of our operating profit in Q1, and we see good opportunities and action plans for further efficiency in our Service Business and through that improved customer satisfaction. In addition, as new car sales increase, this typically translates into higher volumes in the service workshops over time as the car population grows. We expect demand will remain stable in the coming quarter.

Then briefly on consolidation and capital allocation. Q1 was a quiet quarter in terms of acquisitions activity in the sector. We have a strong track record when it comes to acquisition and remain disciplined and flexible in our capital allocation. We continuously assess acquisitions alongside share buybacks, dividends and deleveraging with a clear objective of maximizing shareholder value. While valuations are generally stable and occasionally demanding, our strong balance sheet and efficient operation leave us well positioned for continued growth when the opportunity might appear.

This finalizes our first quarter presentation, and we can now open up for questions.

[Operator Instructions] The next question comes from Alexander Siljestrom from Pareto Securities.

Congrats to a strong quarter. My first question is on sort of the demand impact on the geopolitical turmoil and higher oil prices. I guess you alluded to it here at the end of the presentation that you've seen strong exit rates in March and a strong start in April. Could you discuss that and maybe with emphasis on new cars and also used cars?

Do you want to take that?

Yes. You said the oil price. Yes, we can see -- if we go to the used cars, we can see better demand for fully electrical cars now because you have the prices over petrol and diesel. So there, we can see a little bit of shift for the movement now. So it's easier. But what we have mentioned today here, it's a low level, the price and we have stabilized the price for fully electrical cars. So we think it's good for us.

When you say new cars, fully electrical cars is driven by the fleet business. Companies, they have policies for their employees to take a fully electrical vehicle. Private consumers, they are a little bit more hybrid for the movement. So if we have really good private leasing offers in the market for fully electrical for private consumers, we sell them.

Stefan?

Yes. But I think also -- I think so far, we can see that the fleet market seems stable. So the fleet customers are not hesitating yet. So that's good. We can also see in the heavy truck business still going well with the sales with the new trucks. So no stop there. So I think, as Per mentioned, perhaps in the future, we will see with the customers, private consumers, but not on the fleet business.

Okay. That's very clear. And then also a question on Norway. The Service Business, you reported strong organic growth, but margins were down a little bit here year-over-year. If you could discuss that dynamic as well would be very helpful.

I'll leave that to Frode to reply.

Yes. Thank you for that question. We had a somewhat lower margin in the quarter, which is also caused by a one-off cost in the quarter, which in total, if we adjust for that, that's SEK 3 million, then the margin would be the same level as in quarter 1 last year.

And if you look at our core business, we call it service workshops and spare parts, we have a little bit better margin in this business. But a little bit lower in the smelting business for the first quarter this year compared to the last year.

Okay. That's very helpful as well. And then just a final one from my side. On the savings program, if you could talk a bit about the progress that you are seeing? And also if you could share some run rate numbers on the progression to the SEK 150 million.

Kristina?

Yes, the program is running as planned. So I think what we have communicated earlier is that we expect to have a full year saving, including in the fourth quarter this year, and that is still the plan or the assumption that, that will happen. Nothing indicates anything else.

When it comes to the run rate, I don't think we have given a specific number what is in there. But you can probably make a guestimate based on how far we have come as such.

Yes. And would you say that you are sort of halfway through now? Or is that a good approximation or maybe just 25% considering that we're in Q1?

Yes. No, we [indiscernible] savings programs, right? You're going to be accelerating at the end, right? So it's not half, more like 25% in that sense.

The next question comes from Andreas Lundberg from SEB.

On the orders and backlog and taking into consideration the extremely high orders you had in the end of '25, especially in Norway, what does that imply?

Frode?

Yes. As you mentioned, we had a very strong finish of 2025, and we saw a somewhat softer order intake in quarter 1. In total, quarter 1 was 9% below last year, first quarter, but it increased during the quarter. So March isolated was 11% better than March last year, and we see an increasing pace in the new car business.

We can say it's in line with our expectations we had because we have a strong in quarter 4 order intake. So -- and you can maybe say something about the tax situation.

Absolutely. And we had a record year in Norway last year with almost 180,000 passenger cars. But the pace last year was towards 150,000 and then you get a lift up after the proposed taxes for 2026, which then resulted in 180,000. Now we see that the market year-to-date is 13% lower, meaning that we pace towards that pace towards 135,000 units, but we are quite confident that we will have the same for used cars, maybe not as strong as last year for the used cars. So our expectations for 2026 is a total car market of about 160,000 cars, which is still a strong market.

And we will have a change from the beginning of this year, we started to have tax on BEVs from NOK 3,000 instead of NOK 500,000. And now from '27, we will have VAT as from NOK 150,000, giving a benefit for the customer of NOK 37,500 to buy the car this year compared to next year and actually NOK 75,000 in benefit taking the car out this year instead of in 2028.

So we are confident historically this kind of tax changes gives a strong push in the market. And for quarter 4 last year, then the tax benefit was NOK 50,000 given the volume increase. So we think we will have good market conditions if nothing happens in the [ modern world ] picture. We think we'll have good market conditions in Norway, both in '26 and '27.

But are you surprised that -- I mean, Q1 seems to keep up well given the dynamic with the big orders ahead of the new year?

I think that got a lot of initiatives at the end of last year where we have tax protection and what have you. So I think that the competitiveness in the Norwegian car market maybe stronger today than probably not say ever, but for a long, long time. And if you look at the price for a family car today compared to the average income, I think a new car has -- is cheaper relatively than for many, many years. So we have a strong push. And actually, XPENG, our Chinese brand was our biggest brand in the first quarter, giving some strong volume support.

And of course, Tesla was 25% of the market. also having extremely attractive campaigns in the marketplace. So the competition in the new car market is extremely strong at the moment. And luckily, we have strong brands to participate in that competition with.

Okay. Cool. And on the models you mentioned, in high demand, I guess you're referring to specific ones. How do you think that will play out during 2026 given your lead times, waiting times and how much of -- is that still already in the backlog?

Is it specific for Norway...

In general.

But then we can say, I think when you talk about BMW iX3, still there are capacity. And now we are starting the deliveries of the iX3. And I think also the signs we get from the factory that still is capacity for the Swedish market.

And then the i16, the deliveries will start, I think, yes, say, during the summer or after the summer...

After the summer.

Yes. And I think also still the capacity is in there. So for the moment, no -- we will not miss the customer out of that perspective. They're always talking about to deliver a little bit over 7,000 EX60 cars in -- start -- after the summer. So in quarter 3 and quarter 4, we will start to deliver them.

And a different question on the top line that was down a little bit. Is that due to the, say, agent model? Or why is net sales down?

I think [indiscernible] them. And then Andreas, if you compare that with the number of delivered cars, if that is why you're asking, we also have a little bit more of cars that are subject to repurchasing commitments. And hence, that means that sales is reversed and allocated over the leasing period of normally 36 months. So it's kind of adjusted way through that.

[Operator Instructions] The next question comes from Mats Liss from Kepler Cheuvreux.

A couple of questions. First, I mean, looking at service, there's a quite good improvement there in Sweden. And I just -- well, is it more related to deliveries of new cars and the demand in the sort of existing car fleet is still somewhat hesitant.

Stefan?

Yes. But I think it's a mix. We can see -- when we see the result, you can see that the turnover is higher, the efficiency, we can see that the efficiency is higher. And we can also see that the delivery workshop are going on a higher pace. And also, we have a better, you can say, tire business this year. So I think it's a mix of these different elements.

Great. And well, we had an early Easter there this year. So it's -- well, tougher comps year-over-year quarter 1 compared to quarter 1. So should we expect sort of, well, some delayed service demand to pick up in the second quarter? I mean Norway is normally...

I think it's quite similar to the previous year. I don't see any big differences when we come to customer behavior during -- when we talk about Easter and things like that. I think we see that we are well in line with the tire change. I think like 80% is done. So in our behavior changes. So I think -- and the customer behavior, I think quite similar to...

And the working days in April is the same as we had in the last year. And -- Norway, the Easter can be sometimes complicated because you have a red day for the Thursday.

Yes. So that was [indiscernible]. Quarter 1 is very similar to last year?

Yes.

Well -- and then looking at car sales, I mean, earnings in Sweden was quite soft in the quarter. Is that sort of a temporary impact? Or should we expect a similar development in the second quarter there? Looking at car sales, I mean earnings there, if you look at the geographical mix there, we had...

Sales or the profitability...

Operational earnings there in Sweden was SEK 3 million. [indiscernible] number.

But it was related. I think it was an improvement with -- we reduced the loss in new cars, and I think it was still quite stable in used cars. I think SEK 3 million less compared to last year. So I think on a quite good level. And as Per mentioned, we think the used car market has stabilized and the pricing has stabilized also for fully electric. So I don't think it was that big changes compared to last year. But hopefully, we will deliver more new cars in the quarter 2 compared to the last tear.

And used car, probably yes, maybe improving from these levels. So we will see a sequential improvement. I mean it's -- I mean, Sweden is the largest market. So normally it should provide more than this, I guess.

The next question comes from Jacob [indiscernible].

We have a question regarding BMW market share. So if Hedin Automotive's BMW dealerships were to be sold, would Bilia be interested in increasing its BMW representation in Norway and Sweden?

For us, it's only speculations. So -- and we have not heard a rumor about they will sell their business. So we have our BMW business, and we are really big already. I think the order intake in Sweden is 35% in Norway is quite the same. So we are really big in the business.

Okay. And then we have a question regarding XPENG. If the opportunity comes up, would Bilia consider becoming an XPENG importer in Sweden and Norway?

We actually think that the setup that we have today is very good. We have a setup with the agent model where both the NSC and the OEM is taking a greater responsibility. And for a brand which is in attacking mode to expand and really build up the business, we think that is a good setup. So we are happy as agents of XPENG and are expanding that business as agents.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much for listening. And if you have further questions, please reach out to us, and we wish you all a great day and a good weekend when it comes. Thank you very much.

Thank you.

Welcome to the Bilia Q4 report for 2025. [Operator Instructions]

Now I will hand the conference over to IR, Carl Fredrik Ewetz. Please go ahead.

Thank you for the introduction, and welcome to Bilia's fourth quarter results presentation with CEO, Per Avander; CFO, Kristina Franzen; and I, Carl Fredrik Ewetz. We also have our Deputy CEO, Stefan Nordstrom, attending today.

We are happy to present a strong result with higher order intake for new cars, strong cash flow and even more solid financial position than last quarter. I will come back to our outlook at the end of the presentation.

Here's our agenda. Per will start with the current situation in the industry, followed by Q4 numbers. Then Kristina will go through the financial situation, and I will conclude, like I said, with our outlook end of the presentation.

So let's start, and I leave the word to Per Avander.

Okay. Thank you, Carl Fredrik. Since quarter 3 in Sweden, we have seen signs of better interest in new cars from private customers. In Norway, we have had good demand from customers in the new car business, driven by good campaigns and new tax regulations effective from 1st of January this year.

In Western Europe, the demand remains stable. Most of our brands have strong campaigns, big discounts, attractive private leasing offers, especially in Sweden.

The demand for used car is on a slightly lower level in our countries and we see some lower prices for all cars, especially for expensive plug-in hybrids and electrical vehicles. As we mentioned in the last report, the government in Sweden terminated all incentives for EVs approximately 3 years ago and we expected a large number of incoming used electrical vehicles.

Up until now, we have handled the situation in a good way. In Bilia, the stock of used car is on a good and balanced level in our countries.

There is a good and strong demand in the service business in Norway and Western Europe with good booking times. In Sweden, we see weaker activities with somewhat lower booking times.

Part of the explanation is the last years of lower new car sales and export of young used cars. The total car market in Sweden 2025 was almost 20% lower compared to an average market the last 10 years. During this period, there has been a shift in the car population to more older cars.

Next, please. Net turnover was in line with last year. We report operating earnings of SEK 450 million with a margin of 4.4% compared to SEK 420 million last year. We report higher operational earnings for both the service business and the car business and higher profitability in Norway and Western Europe related mainly to new cars.

Operating profit was SEK 370 million compared to SEK 351 million last year and included SEK 23 million of costs related to our efficiency program that we launched during the quarter. This efficiency program is expected to generate savings of around SEK 150 million. Earnings per share were SEK 2.46 compared to SEK 2.10 last year.

On this slide, you can see the quarter 4 profitability from 2019 to 2025 in each country. And in the middle, you can see Norway and a good improvement. On the right-hand side, you can see Western Europe and its steady journey over the last years with a margin of 7.4% in the quarter.

On this waterfall chart, you can see the different business areas. We have improved the earnings in the new car business and the service business and drop a little bit in the used car business, but still on a good and profitable level.

We are moving over to the important service business, representing 78% of the earnings in the quarter. In all our countries, we see an improvement in profitability and with a better margin of 13.9% compared to 13.6% last year.

We had a positive organic growth in the group, driven by Norway and Western Europe. There were same number of working days in Sweden and Belgium and one more in Norway and Luxembourg in the quarter. We report earnings of SEK 395 million, which were SEK 21 million higher than last year and this was the best quarter ever.

The order intake on new cars adjusted for acquired and divested operations was 30% higher compared to quarter 4 last year. As I mentioned, we have seen a little bit better activities in all our countries, especially Norway, which was impacted by the change in tax rules.

However, also Sweden had a solid increase of order intake by 20% compared to last year. For the car business, we report operational earnings of SEK 104 million compared to SEK 80 million last year. The profitability from cars in Sweden was on a slightly lower level and the higher result relates mainly to Norway.

For used car, we report earnings of SEK 41 million compared to SEK 54 million last year. In a historical perspective, it's a good level. As I mentioned in the beginning, the stock of used car is on a good and balanced level in all our countries. The reason for the lower earnings was some more price pressure on used fully electrical cars and some lower demand.

We have increased our underlying backlog of new cars with 2,400 units. And today, we have 13,500. Some of our brands have recently launched interesting new EV models, attracting lots of interest from our customers.

For many of them, for example, the new BMW iX3 and the Volvo EX60, we see a little bit longer delivery times due to the high demand.

So let's move into the financial position. During the fourth quarter, we reported a strong operating cash flow of SEK 675 million compared to just below SEK 300 million last year. It means that for the full year, we have created an operating cash flow of some SEK 2.1 billion.

Cash flow is a key focus area for us and will continue to be so for the future as well. As a result of the strong cash flow during this quarter, but also during the year, our net debt, excluding IFRS 16 at the end of the quarter amounted to some SEK 2.2 billion, which was almost SEK 700 million below our net debt at the end of the last year.

Our ratio of net debt in relation to EBITDA, excluding IFRS 16, was then 1.3x compared to 1.7x as at December 2024. Consequently, we are well in line with our financial target to have a ratio below 2.0x.

As of October 1, we did repay our bond loan of SEK 500 million, which we refinanced during the first quarter this year by issuing a new bond amounting to SEK 800 million with a maturity term of 5 years.

The repayment of the old bond was then made through our available credit line. And at the end of the quarter, as a result of the strong cash flow, we utilized some SEK 60 million of our credit facilities amounting to SEK 2.3 billion in total.

In November this year, the Board of Directors took a decision to repurchase own shares to a maximum of 1,250,000 shares at a maximum value of SEK 150 million. So during the fourth quarter, we did make repurchases of shares. In total, 446,000 shares at a value of SEK 57 million has been repurchased.

So for the full year 2024, we had earnings per share of SEK 8.22 versus SEK 7.19 last year. The financial target for the group is to distribute at least 50% of the earnings per share to dividends.

Our Board of Directors has made a proposal to the Annual General Meeting to increase the dividend from last year's SEK 5.60 to SEK 6 per share, which is an increase by 7%. That also means that the proposed dividend comprised of 73% of the earnings per share for 2025 and the dividend will be made in 4 installments as we did last year.

In the report for the fourth quarter, we also announced an update of our financial targets. Our service business that Per talked about previously and the car business is an integrated operations. Their operations are tied to each other. And together, they comprise our business strategy to be a full service supplier during the lifetime of the car.

To further enhance strategic management and transparency, we have updated our financial targets for profitability. We have replaced our previous 5% operating margin target for the group with 2 separate financial targets.

For the service business, we have a profitability target that is a margin for operational earnings of 14% and this is a target level that we have talked about earlier, both in our annual report, but also in different meetings such as our Capital Market Day.

For the car business, we have a new profitability target that is return on capital employed amounting to 8%. The return on capital employed that will be used will exclude IFRS 16 assets.

This target is new and has been selected as it combines the focus on margin development with a focus on capital efficiency development. The car business is the segment within our business that ties most capital, typically cars, both new cars, used cars, leased cars and demo cars, while we target to have a return that equals our cost of capital.

Information about the margin for operational earnings for the Service division has been presented in our quarterly reports in the past. Information about return on capital employed for the car business, together with the capital employed at the end of the quarter is included on Page 28 in our report for the fourth quarter and will be reported on a quarterly basis going forward as well.

Here, you will also find a historical development for the last quarters as well. And combined, these 2 new profitability -- financial profitability targets essentially correspond to our previous target of 5% operating margin for the group.

Good. Thank you for that, Kristina. Then let's go to what we believe the future will bring. We remain very focused on improving both profitability and operational efficiency. Our efficiency program implemented last year is going according to plan, like Per said, and savings of SEK 150 million will be fully achieved as earlier communicated.

Profitability, cost discipline and capital allocation will continue to be core priorities across the entire organization. Like you heard, to strengthen our strategic direction and increase transparency for investors, we're updating our previous group-wide profitability target of 5% operating margin by splitting into 2 separate financial targets.

This makes it easier to track performance, improves capital allocation decision and provides a clear view of how we create value over time.

Moving over to the car business. Demand for used cars is currently weak with price pressure, particularly on expensive electrical vehicles and plug-in hybrids. We believe the coming quarters may be characterized by similar features.

Our used car inventories are at a healthy level and the anticipated surge in used vehicles during the fourth quarter did not materialize to the extent we had feared.

For new car sales, the start of 2026 is described by slightly softer demand, particularly in Norway, impacted by the change in tax rules effecting from 1st of January, while corporate customers' purchasing activity remains stable. We saw a noticeable upturn in private customer interest during the third and fourth quarter, supported by a strong offering in the market.

We believe we will continue to see increased activity from private customers along with car campaigns and launches of new cars and models, especially some important EV launches we believe will support volume and at the same time serve as a new and compelling alternatives to our customers in the near to midterm.

Then in our important service business, we expect continued stable demand during the coming quarters. In Q4, the service business, as you've heard earlier, represented 78% of our operating profit. And we see good opportunities to continue developing our service business and through that improve customer satisfaction.

Then briefly on consolidation and capital allocation. We have a long and proven track record of growing through M&A, which is an important part of our growth strategy. Currently, we remain flexible, balancing between acquisition, share buybacks, dividend and deleveraging.

We are evaluating opportunities daily with an aim to always strengthening shareholder value in the best possible way. Overall, we find valuations stable, sometimes a bit stretched by certain processes -- why certain processes take longer than expected and why some do not materialize. But with a healthy balance sheet and efficient operation, we are ready for continued growth.

This finalizes our fourth quarter presentation, and we can now open up for questions.

[Operator Instructions] The next question comes from Andreas Lundberg from SEB.

I have a couple of questions. If we start with the efficiency program, I think you mentioned it, but I couldn't hear what you said about the savings in 2025. And how do you think that will play out, the remainder of the savings in 2026?

We didn't give a specific figure for what the size of the savings are in 2025, but there is a certain cost savings in there, right, because the program has started. We do expect that the savings will be fully materialized by the second half of 2026, which is in line with what we said also in the third quarter.

Okay. Cool. I thought you said something. I was -- misunderstood. And different topic, the clearly higher Norwegian registrations in November and December for new cars. How do you think that dynamic will play out when it comes to selling the cars and also delivering the cars if you're looking into 2026?

If you look at the registrations in January, you see a huge drop now. I think the total market in general will look a bit over 1,000 cars.

So -- and we see the order intake is, yes, much lower as well. So what we have said this morning that we think that because they changed the tax rules for 2026 to 2027 with the VAT again. So what we can see, it will be a little bit slow demand now in quarter 1. And in the end of quarter 2, it will be better and better in the order intake for new cars.

Okay. But the car that was registered in before year-end, have all those cars been delivered already?

No. So we will deliver some of the cars in quarter 1. So there is...

Even like the end of March?

Relation between registration and delivery of cars because we registered them in the end of quarter 4.

Yes, and in some cases, we have been able to deliver them to hand over the keys to the customers, right? So those have been delivered straight after year-end.

Yes. So it could be misleading to look at the registration data in the early part of '26?

Yes.

Be a little bit careful with that, I think.

But also, the tax changes in Norway will continue. So that's why we think it will be a new push in the end of the year, because once again in for 2027 change the tax regulations, so, yes.

Yes. Got you. Changing over to Sweden, where the service demand was still a little bit slow, but still able to hike margins. Can you talk a little bit about what your -- how you improve the Swedish margins on the service side?

Yes. We have said -- we have seen a lot of years now with the weak total market on new cars, and that effect we hope 2026, we will increase the order intake for new cars again. So if you look at the newer used cars, so it's 25% less if we are talking Bilia's brand in Sweden from 1 year to 4 years old cars.

And that is the most loyal customers. So we see a little bit weaker demand for the moment. But what we are doing now is we try to much more focus on the older car park cars like 7, 8, 10 years old to have some attractive --

Offers.

-- offers for the customer.

But you can also say, Andreas, well as Carl Fredrik mentioned, we are working with the companies we have. We try to -- yes, look at the process and how can we improve them and that will continue. So we continue to work hard to improve the businesses we have and that will be the focus as well.

Okay. So there's nothing particular or specific that is helping your profitability in Sweden now?

I think like this, Andreas, you can't find in the workshop, you can't find one thing. It's a lot of different things. We need to work it.

Got you. Lastly, on investments or CapEx. I think you have around SEK 400 million in 2025. What's the best proxy for '26?

I think you should have the same level there, right? It would not be significantly different, I confirm. So a little bit of it, but not [indiscernible].

The next question comes from Mats Liss from Kepler Cheuvreux.

A couple of questions from my side as well. Well, the new financial target there or looking at the performance of service, I mean, 14% represents still an upside on a yearly basis. And when do you expect to be able to reach the 14%? Is it sort of a long-term target? Or is it more when these efficiency measures are implemented SEK 150 million? Could you say something there?

Yes. We don't think we will do it in the next quarter, but it's more a long-term target. So in 3 to 5 years, we think we can achieve the target because, as Carl Fredrik mentioned in his presentation here, some of the new acquisition we have made, some of the customer -- companies, they are far away from the target for the moment. So we have a lot to do with some weaker companies we have.

Okay. Then just touching upon different things. The krona has sort of -- the Swedish currency has strengthened somewhat there. And could you say something about the flow of cars there? Is it between countries? I mean, Europe -- I mean, Western Europe, you have an operation there. Do you see sort of flow coming back from there? Or is it sort of a neutral situation?

You're talking about export to import used cars.

Yes. Yes, sort of.

Yes. Understand that. We see a little bit lower interest from other countries. If you look back 2, 3 years ago, we exported a lot of cars from -- newer used cars from Sweden to Germany, Belgium and other countries in Europe. Still, we see some exports, but we don't see so much car coming back for the moment into Sweden now.

Understood. Then Carl Fredrik mentioned the M&A opportunities there. Could you say something about -- I mean, you have acquired a couple of commercial vehicle service units during 2025. Is it within that segment you see more opportunities? Or is it sort of also in the car side that you have...

We say we would like to acquire more when we are talking trucks, Volvo trucks. And if we will do make a acquisition, it will be the countries where we are and often with the brands we have already because if we do that, we can take out a lot of synergies and we have the knowledge about the brands. So maybe in Belgium, maybe in Sweden, maybe in Norway.

The next question comes from Alexander Siljestrom from Pareto.

Congrats on a strong quarter. First question from me is if you could share the share of the deliveries that was completed under the agency model as sales was a bit lower than our expectations on -- in the car segment?

Let's see now what you have in mind. Do you mean that the sale was a little bit lower than you expected? And your question is if that referred to increased agency sale?

Yes, exactly.

Yes. Yes. So I think what we have had, we had a strong increase of the sale in Norway, especially that refer to sales that are conducted under the agency sale. So that is one of the reasons why the sales through the car business is a bit lower than if you compare to the number of cars that has been delivered. So that's true. That's the reason.

Yes. And can you share the percentage that's under the agency model compared to the franchise model in terms of deliveries so we can model it going forward?

Yes. It's actually a little bit of a mixture between different brands, right? So it's not something that I think will be fixed going forward, but it goes a little bit between accessible. So I don't have that percentage and I don't think it's relevant for the future.

But if I guess a little bit here, the wholesale, I guess, now 85% and agency maximum 15% of new cars.

And then it varies a little in countries and country by country.

Yes.

Yes.

Yes. That's very helpful. And then on the margin targets here, very good that you clarified between service and the car segment. And just thinking a little bit about service here, 14% margin target.

How do you think about this across the different geographies? Is it the same for each market? Or do you expect Sweden to overperform and then Norway and Western Europe to lag a bit and then for the group to get at 14%? Or is it viable for all geographies?

We -- the easiest way for us to achieve the target for the service business is to overperform in Sweden and the condition is best in Sweden. So it's a little bit different between the countries.

One example is the body shops in Belgium because we have a lot of negotiations in Belgium with the insurance company and they pay us less if you compare to Sweden is one reason why we can have a little bit lower performance in Belgium and Luxembourg.

But of course, we can still see potential to improve in both Luxembourg and Belgium, Norway. So absolutely.

But often, we have the best margin in Sweden.

So it's a weighted average.

So it's the perspective.

It is a weighted average, right, with a mix of three countries.

Okay. That's very helpful. And then in terms of Norway, what are you expecting there? Is it sort of 12%, something like that?

We are not sort of disclosing the targets for the different countries, but only the average. Yes.

Okay. And then maybe continuing with Norway. And you mentioned that you still have solid tax incentives in Norway for purchasing a new car in full year '26. And of course, it's going to be a bit lighter here in H1 maybe and then stronger in H2.

But if we look at the full year, do you expect registrations to -- could they be flattish or even growing a bit here in 2026? What's your view?

We had a record year 2025. We closed 180,000 new cars. The forecast for this year is a little bit lower, around 160,000, 165,000 new cars, because it was a discussion from the government in Norway in quarter 3 about they will take off all incentives.

If they have done that 2027, it has been a record year, but now they do it in 2 years. So no incentives after when you come into 2028. So a little bit less total market this year compared to the record year last year.

But still a very good market.

Yes.

Yes. Okay. So a little bit lower, but still on very high levels from a historical perspective. That's helpful. And then maybe just finally on the savings program, if you could talk about sort of the share that goes to service and the share that goes to cars or it's mainly related to HQ? And then also, when will you reach the run rate savings? Is it in Q4 or Q3? And how should we think about phasing here?

To start at the last question then I think Q4, it will be sort of included, right? And I think the majority would also be there in the third quarter, right? But fully into the fourth quarter.

When it comes to the Service division and the car business, I think it will be fairly even, right? Perhaps a bit more into the service business, but fairly even, I would say, is a good sort of approximation to use.

[Operator Instructions] The next question comes from Stefan Stjernholm from Handelsbanken.

Stefan here. Most of my questions have been asked already, but I have one on the service business. I mean, winter arrived quite late this season and Q4 was mild. I expect that had a negative impact on your service business. Is that right?

Yes. You can say if you talk about body shop, when you have a mild winter, then it's a little bit tougher. And it's out of that perspective, better when it's a hard winter.

And also you see when you talk about older cars, when it's really, really cold outside, you get more also into the workshop compared to a mild winter. So in that perspective, that's right.

So consequently, Q1 is better in that perspective?

When it's cold, it's an advantage.

The best is mild for a while and then cold and then mild again. That's the best talking about the winter.

Too long now then.

The next question comes from Mats Liss from Kepler Cheuvreux.

Yes. Just a follow-up there on service 14% target again. I mean, it's -- Per, you mentioned that it was a more long-term target. But I just get a feel here for the electrification trend. I mean, we have a lot of hybrid now and I mean, the changeover maybe have been a bit delayed to BEVs.

But BEVs normally have a lower service content. And have you sort of included that in your sort of new target, how to manage that?

Yes. Yes, we have included that because when you talk service, it's a huge difference between combustion engines and fully electric. But you have a lot of other jobs. What we have seen in Norway that the brakes, you have to repair them often.

Windshields is thinner and bigger. So we have other jobs and body and paint jobs. So we have included the BEV situation we will have in future. And every year, we try to find new additional sales when we have the customer into our workshop. So we take care of everything around the car. One now is air condition cleaner is a quite new area there we are now.

But also, Mats, when you take the full, how do you say, car park in Sweden, when you talk about full electrical vehicles, it's about 5%-6%. If you take the car park, it's very easy to talk about the registrations of new cars when it's 35%. But we are working with the car park.

And as Per mentioned, we try to work with the older segment of cars and then to increase there. And there you have no electrification. So I think in the workshop, we also need to focus on the car park and the number of electric cars there. So -- and that's much, much lower to the new registrations.

Great. Great answer. Yes. And another topic. I mean, you have the 3-year electric or semi-electric cars returning now from the 3-year leases. And what's the normal way of handling those? Do you resale them to well, full price or discounted price? Or do you send them out on a new lease? Or how do you handle that?

But it's only one price on the used car. We value them 10 times per year, the cars we have in our stock. And then we sell them to market price. And I think the majority is on a normal sale.

To the end customer.

Yes, to the end customer. It's not a big thing to lease them out again. And I would say that is also due to the new car offers. So that I say it's more normal sales to private consumers. That's the majority.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much for listening, and good luck. Thank you.

Thank you very much.

Thank you.

Welcome to the Bilia Q3 Report for 2025. [Operator Instructions]

Now I will hand the conference over to IR, Carl Fredrik Ewetz. Please go ahead.

Thank you very much for the introduction, and welcome to Bilia's third quarter results presentation with CEO, Per Avander; CFO, Kristina Franzén; and I, Carl Fredrik Ewetz. We also have our Deputy CEO, CFO Stefan Nordström, with us today. We're happy to present a solid result with higher order intake for new cars, positive cash flow and a solid financial position. I will come back to the outlook at the end of this presentation.

Here's our agenda. Per will start with the current situation in the industry, followed by Q3 numbers. Kristina will go through the financial situation, and I will conclude with our outlook. So let's start and I leave the word to Per Avander.

Thank you, Carl Fredrik. In Sweden, we see signs of better interest in new cars from private customers. In Norway, we see good demand from private customers, driven by good campaigns and new taxations of cars from the government. In Western Europe, the demand from private customers remained stable. In the port and fleet business, we see a little bit higher activity in all our countries. Most of our brands have strong campaigns, big discounts, attractive private leasing offers, and there is a high supply of cars from the manufacturers.

The demand for used cars is on a good level in our countries, and we see stable prices for all cars, except fully electrical vehicles. At the same time, we know that in end of quarter 4 in Sweden, we see a lot of electrical vehicles 3 years old. All brands coming back from customers due to the government incentives was terminated approximately 3 years ago.

In Bilia, the stock of used cars is on a low level in Sweden and on a balanced level in our other countries. There is a good and strong demand in the Service Business in Norway and Western Europe with good booking times. In Sweden, we see better activities, but still somewhat lower booking times. Part of the explanation is some years of lower new car sales and export of young used cars.

The total car market in Sweden 2024 was almost 20% lower compared to an average market in the last 10 years. During the last 3 years, there is a shift in the car population to more older cars.

Net turnover was better than last year. We reported an operational earnings of SEK 310 million with a margin of 3.2% compared to SEK 280 million last year. We had higher profitability in Sweden related to both Service and Car Business. Our operating profit was SEK 284 million compared to SEK 216 million last year and included a profit of SEK 35 million related to divested properties in Sweden. Therefore, earnings per share was SEK 2.07 per share compared to SEK 1.15 last year.

On this slide, you can see the quarter 3 profitability from 2019 to 2025 in each country. And on the left-hand side, you can see Sweden and the improvement of SEK 28 million. In the middle, we have Norway, and there you can see some small improvements. On the right-hand side, you can see Western Europe delivering slightly lower result due to underlying less new car deliveries.

On this waterfall chart, you can see the different business areas. We improved earnings in the new car business and the Service Business, but dropped a little bit in the used car business.

We are moving over to the important Service Business, representing 72% of the earnings. In all our countries, we see a positive organic growth with an average of 4.1%. One reason is 10% higher deliveries of new cars impacting our delivery workshops positive. There are same number of working days in Sweden, Norway and Luxembourg, but 1 day less in value.

We report earnings of SEK 233 million, which was SEK 12 million higher than last year. There are several reasons why we report a higher result. As I mentioned, higher deliveries of new cars. Another is in general better activity in our workshop and third is higher organic growth. The order intake of new cars adjusted for acquired and divested operation was 20% higher compared to quarter 3 last year. As I mentioned, we have seen a little bit better activities in all our countries, especially in September.

For the Car Business, we reported a result of SEK 81 million compared to SEK 73 million last year, coming mainly from Sweden. The profitability for cars in Norway and Western Europe was on a slightly lower level. For used cars, we reported earnings of SEK 61 million compared to SEK 96 million last year. In a historical perspective, it's a good level.

As I mentioned in the beginning, the stock of used car is on a low level in Sweden and at a balanced level in Norway and Western Europe. The reason for the lower earnings was price pressure on used fully electrical cars. We have increased our underlying backlog of new cars with 900 units. For many different brands and models, we have really short delivery times. So by that, we think 12,500 new cars is a good level. This means we often can sell and deliver a car in the same quarter. Yes. Kristina, is your time.

Thank you, Per. So financial position. During this quarter, we reported a strong operating cash flow just below SEK 800 million. This reported cash flow did include a received payment of some SEK 300 million related to the divestment of 6 properties in Sweden that Per mentioned before. After adjusting the reported operating cash flow for these divested facilities, this cash flow amounted to just below SEK 500 million for the third quarter, which is still a strong cash flow and in line with last year's level.

The 6 properties that were divested are used in our Porsche, BMW and Toyota operation, and these facilities are now leased back from the new owner for a period from 2 to 15 years. For the group, the divested facilities generated a nontaxable profit of SEK 35 million, which also impacted our tax rate for the quarter, going from a normal tax rate of around 22% to a tax rate of 4% only. The divestiture of the 6 properties in Sweden enabled us to finance our acquisition of Volvo Lastvagnar operation with basically no impact on our net debt leverage.

As of July 1, we acquired 2 companies that perform sales of new and used Volvo Trucks and provide related services. The business had in 2024 a turnover of some SEK 1 billion with an operating margin of around 4.5%. The business is conducted through 9 facilities in mid-Sweden with around 160 employees and will be branded as Bilia Trucks going forward. We do look forward to the cooperation with Volvo Lastvagnar, which is a significant player on the Swedish truck market.

During the end of the quarter, we also acquired a Jaguar and Land Rover business that has been conducted by Sandven AS in one facility in Bergen in Norway. The business had in 2024, a turnover of some NOK 280 million with an operating margin of around 3.5% and the number of employees was 29 persons. So during the quarter, we did make the second payment of SEK 130 million related to this year's dividend of SEK 5.60 per share in total. The dividend is paid in 4 installments, where the remaining 2 installments are in October and January.

At the end of the third quarter, we had an earnings per share of SEK 5.76 versus SEK 5.08 last year. The financial target for the group is to distribute at least 50% of the earnings per share to our shareholders. By the end of the third quarter, we utilized some SEK 600 million of our credit facilities of SEK 2.3 billion. As of the 1st of October, we also repaid a bond loan of SEK 500 million, which we refinanced during the first quarter this year by issuing a new bond amounting to SEK 800 million with a maturity terms of 5 years.

And then finally, our net debt, excluding IFRS 16 at the end of the quarter amounted to SEK 2.5 billion. That was about SEK 400 million below the net debt at the end of last year. Our ratio and net debt in relation to EBITDA was then 1.5x compared to 1.6x by the end of the second quarter and 1.7x compared to December last year. By that, we have made a reduction and are also then well in line with our financial target to be below a ratio of 2.0x. So I think that's about the financial position.

Good. Thank you for that. Moving over to outlook. Our efforts to enhance profitability and operational efficiency remain a top priority, while we accelerate this process by introducing an efficiency program. The SEK 150 million savings will be fully implemented during the second half of 2026 with an estimated onetime cost of approximately SEK 25 million. Profitability, cost control and capital allocation remain top priorities throughout the whole organization going forward.

Moving over to the Car Business. For used car sales, we believe the remainder of 2025 may be characterized by some price pressure and higher competition as many electric cars will come back due to, for example, private lease renewals and the government incentives was terminated approximately 3 years ago, like Per mentioned earlier. We currently have a low stock of used cars and are well prepared for such a situation.

For new car sales, we believe we will continue to see signs of increased activity from private customers. Demand from corporate customers is stable, and we see indication of some increased interest also within this segment. In addition, the forecast for new passenger cars registration for 2025 in Sweden is trending higher, now at 280,000. So combined with the assessment of a gradually better economic situation and improving forecast for cars, we see a cautiously positive development in demand for new passenger cars during the rest of 2025.

Then briefly on Bilia Trucks, which is newly acquired Volvo Truck business. Implementation is going according to plan, and the company is performing. This is a business we believe strongly and see a good complement to our existing businesses.

In our Service Business, we expect continued stable demand for -- during the remainder of 2025. In Q3, the Service Business represented 72% of our operating profit. We see good opportunities to continue developing our Service Business through that improved customer satisfaction.

Then briefly and finally, on consolidation, the rapid tech development of cars, especially the increased integration of electronics and digital systems has led to a growing need for advanced service expertise. This development benefits Bilia and drives a consolidation of the market for players with the capacity to meet future service needs strengthen their positions. We continue to evaluate opportunities in attractive business areas and are ready for continued growth. Yet again, a healthy balance sheet is always a priority for us and will continue to be so. This finalizes our third quarter presentation, and we can now open up for questions.

[Operator Instructions] The next question comes from Andreas Lundberg from SEB.

If I start with the activity, you talked about some increased activity among private consumers. Can you perhaps give more color on what you see and perhaps the reasons for why you see it?

Yes. One reason, as you mentioned, it's coming from -- we sell more cars, new cars. So I often talk about the delivery workshops. So we have had a better activity in the delivery workshops. And we see a little bit better in our body and paint shop as well.

Andreas, Stefan here. When it come to sales -- one example, we measure the floor traffic in all our showrooms, and we can see the activity with customers entering our showrooms is increasing. We can also see when we measure like credit requests when people ask for offers and business proposals, we can see that, that activity is increasing. And I think it's connected to also when you see the offers of private lease from our manufacturers.

Today, it's -- how to say, the prices are attractive and the campaigns are better. So in that perspective, we see the customers like increasing the interest. And then we also can see the higher activity in the fleet business. It's more activity among the fleet customers, the -- how to say, the thing we have to do and work with is the interest is higher even there.

That was a good answer, Stefan. Can I ask a follow-up on the fleet activity? Has that -- as far as I'm concerned, this has been rather stable for some time? Or why do you think you see higher activity among fleet customers?

No. But I think as Per mentioned, we can see that the interest rate is going down. I think the customers now, they have been like saving up a little bit. So now it's time and it's the pent-up demand for cars, new cars among private consumers because they have been waiting.

And the best market for us, the last quarter is Norway. We are coming from low figures last year, but we sell a lot of the new cars in the Norwegian market. And one reason is that we changed the taxation to the government next year. Today, you have a VAT, it was NOK 500,000, you have to pay VAT. And the government now, they say next year, it be NOK 300,000 will be the cost for the customer NOK 50,000. And the year after that, they will reduce to 0 to NOK 75,000. So what we can see now, we can see a better activity in the Norwegian market from both fleet business and private consumers. So yes, we think it can be really good in quarter 4 and the next year for order intake in the Norwegian market.

If I shift gear to the service operation, can you start with talk a little bit about [ EV ] you haven't seen some pressure on the profitability here in the last, call it 2, 3 years, the reasons behind that, what you are doing to improve it and perhaps also the difference between the second and the third quarter. I recall Q2 was a little bit tough, especially on the Swedish side.

It was Sweden and we had low booking times, and it was not only Bilia it was a market end demand you can say. And what we try to do now to work with the older stock of cars. When I say older, often the customer, they are really loyal us the first and the second owner of the car. But when the car is 7, 8, 9, 10 years old, sometimes we miss them to independent worker. So we try to work hard with them. And as Stefan mentioned, the interest rate is lower. So maybe some of the customers, they had a movement like wait and see. So we see a little bit better activities. As I mentioned, when we sell more new cars, we have more to do in our workshop as well.

Andreas, one thing when we see the result in aftersales, you can see like when we measure it when you take it in SEK from 2014 to this year for the first 9 months, it's actually the second best result we have. Only 2021 was higher when you talk about SEK. So it's actually, I would say, a strong result in the aftersales business. And we continue with efficiency and the efficiency program and try to do it step by step.

Yes. Our profitability has come down, right? Maybe the third quarter was a decent one.

Yes.

Right. Okay. Cool. And then on the efficiency program you mentioned, could you give more flavor on this? Where are you looking to be more efficient? What does it mean for the Bilia organization?

I mean it covers all aspects of the group, right. So it's to do what we do in a better way to be more efficient. I think we also talked a bit about it on the Capital Markets Day we had. So it will involve most of the operations we have, but it will not involve the sort of production people in that sense. So we will -- it will be implemented fully by the second half of 2026, and there will be some onetime expenses that will be taken in the fourth quarter.

Is this mainly labor? Or are there other savings you think you can make?

Yes. I mean the majority refer to people cost, but this will, of course, be handed in a as a smart way as possible and that will be sort of taken in a natural way to the extent possible.

And it can be consultants in our IT subsidiary company is one example.

It will involve consultancy, but also there to consider when people are leaving do not make replacements. So there is different aspects of it.

And lastly, on the used car business, you talked about an increased supply mainly coming from EVs in the fourth quarter. I mean what do you think are the implications and then also for the residual values also considering that you most likely value your cars multiple times a year.

What we do, as we mentioned, Andreas that is, of course, that we make an assessment of the expected market value for all the cars where we have a residual value, and we do that on a monthly basis. And also here, we have, of course, done our very best estimate for the market value when they are being returned and that also mean that we have taken a little bit more cautiousness into that valuation we have done for those cars.

We think we have control over the residual value for the car is coming back in the end of quarter 4. But all brands will -- it is sort of a peak in Sweden because they cut off the incentive 3 years ago from the government. So what happened in the market because all our competitors, they have residual values and the financial companies as well. So we don't know what will happen with the peak. Therefore, we talk about it.

But I think also, Andreas, Stefan. We have prepared for the situation. So we have, like as Per mentioned, really low used car stock in the Swedish market. So we are well prepared. So from the beginning of this year, we have worked to reduce the stock of used cars, and it's a quite big change from the last, how to say, year-end. So we are well prepared now when the cars are coming because the stock in the Swedish market is low now for us.

The next question comes from Mats Liss from Kepler Cheuvreux.

A couple of questions. First, I mean, fourth quarter is normally seasonally strong there for service. And then again, you mentioned this EV -- well, coming back a lot of EVs there. Should we expect this to be balanced seasonally stronger fourth quarter? Or is it marginal impact there since you have prepared for this return of EVs?

We never give forecast, but if sort of a guideline to you. So I guess it will be a pressure of fully electrical cars. But Stefan mentioned, we have prepared for it, and we can survive and wait a little bit. So we don't have big discounts for EV cars in quarter 4. We sell them too fast, so we can wait and see in quarter 1 with some of the EV cars and it's only in Sweden.

But in the other end, we think we will deliver more new cars in the Norwegian market. As I mentioned now, there will be the changing of taxation for the government. So there, we see some signs that it will be a good new car market in the end of quarter 4. So maybe sort of a balance between a little bit drop in Sweden, but maybe better in Norway where we talk new and used cars.

Then about service then. I mean, I know previous quarters, that in second quarter, you mentioned that car owners were a bit cautious in handing in their cars to the paint and body shop due to -- they didn't want to be too aggressive on paying for those kind of measures. Have this sort of eased now? So you see that there is an -- well, pent-up demand for paint and body shop works as well in your...

Yes. We think it is a little bit better when we look at the booking times in the different body and paint shops now. So the reason in quarter 2, maybe it was too costly for the customer to pay because often they have a sort of what you say in English, they have to pay some cash when they have the insurance company and some can be quite high -- quite high.

So you see better activities in the body and paint shop. I guess the customer thought it was too expensive for a while, but now they have to do it. So -- and I've talked with so many colleagues and competitors in the car industry and nobody could say it's only this problem we have had because it was the same for all at that time. But now it's a little bit better again because if you look at the motorways, it's happened a lot of accidents every day. So it must be a lot of job in our body and paint shops.

And then you mentioned, I mean, the cars become more high-tech sort of. And you also mentioned that you try to keep the cars in your service shops for longer, second and third owner there. Does this mean that you gain market share? I mean -- or would you say that you are sort of keeping your position?

It's not easy to measure in the Service Business because you don't have official figures for that. But what we can measure in each workshop, we can see how many cars we have into the workshop from 0 to 3 years old and for 4 and 6 years old and older than that. And then we can see a measure in each workshop and we can see more older cars into our workshop because we try to be attractive with different campaigns and so on.

When you do -- well, when you extend the service offers, do you use sort of brand-specific spare products? Or could you sort of offer the sort of multi-brand or...

No, not. It's brand-specific parts anyhow. And as we mentioned before, but we are like working more with also our vehicle dismantling where we renovate spare parts. So we are starting to also offer slowly now, but renovated part, but it's brand-specific parts with warranty. So that's no change. But then we look into how can we do -- how to say, have a special pricing for the older segment. So that's what we are working with.

But we don't like the multi-brand strategy in our workshops. So specific for each brand. So if you see we have showroom for Volvo there we repair and service for Volvo.

Great. And finally, just about your truck operation now growing in importance gradually, I guess. But will this sort of be more of a Swedish operation? Or are you sort of addressing Volvo Truck brands in other countries as well?

The easiest way for us is to grow in Sweden first. And when we are fully in Sweden, we maybe can go to Norway or Finland in the future. But we -- now we integrate the business into Bilia and we have full respect for the business because the Service Business is much bigger. If we say often that when we talk Bilia, the turnover is -- although the total turnover is 20% to 25% but here is 40%. So it's a really big Service Business. So if you will see some step for growth, it will be in Sweden.

The next question comes from Alexander Siljeström from Pareto Securities.

So a couple of follow-ups from me. Wondering if you can talk about how you see the lower the VAT exemption in Norway for EVs impacting demand in 2026.

No, I didn't follow you. What did you -- could you please repeat that? The lower tax rate, right?

Yes, the VAT exemption -- lower the VAT exemption in Norway, how will that impact demand in 2026?

Yes. If you start in the past, it was free from VAT fully electrical vehicles, a couple of years ago, the government took a decision. So today, you have to pay VAT over NOK 500,000. And now they take a decision for next year, NOK 300,000. So what we think and our Managing Director [indiscernible] Norway say to us, it will be raise now with a lot of order intake because you save SEK 50,000 each car from now to the end of this year. And then the government say, 1st of January 2027, there is no incentive when you are talking VAT. So next year, the customer will save SEK 75,000 cars -- each car. So what we think we will have a really good order intake this year and next year.

Okay. That's very helpful. And then maybe just on the cost savings program. If you can expand a bit on the phasing, do you expect some positive impact in H1 and then reaching a full run rate in H2? Or how is that looking?

Yes, there will be some positive effect also during the first half of the year. That's right. But it will be fully implemented in the second half.

Cool. And then maybe just a last one from me on the used EVs here in Sweden. Do you -- and obviously, a drag on Q4, but do you expect this to be a drag into Q1 and Q2 as well? Or could it be over post Q4?

We think it will come back, cars also in the Q1 next year.

But you have the peak now in Q4, and we don't have so many residual values in our books, but different, for example, BMW Financial Services and Volkswagen Financial Services, they will have a huge amount of fully electrical vehicles in the end of this year. But for us, it's not -- it's limited the amount we will get back. But the peak is quarter 4.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you for that, and thank you for listening. And if any further questions, just give us a call or send us an e-mail. Thank you very much.

Thank you.

Thank you. Bye-bye.

Thank you. Bye-bye.