Vimian Group Aktie

Welcome to Vimian Group Q2 Report 2026 Presentation. [Operator Instructions] Now I will hand the conference over to the speakers, CEO, Alireza Tajbakhsh; and CFO, Carl-Johan Zetterberg Boudrie. Please go ahead.

Good morning, and welcome to Vimian's Second Quarter Earnings Call 2026. I'm Ali Tajbakhsh, Group CEO. And together with me, I have our CFO, Carl-Johan Zetterberg Boudrie, who will be presenting our results for the second quarter. We at Vimian continue building upon a good start of the year and report a second quarter with strong revenue and earnings growth as well as margin expansion. Our double-digit growth in the quarter is well ahead of the global animal health market, coupled with strong adjusted EBITA growth. We have also closed 4 acquisitions year-to-date and continue to advance our M&A pipeline with active discussions across all 4 segments. We've also achieved recognition for our ESG achievements with a new AAA rating with MSCI.

Turning to the numbers a bit more in detail. We report 17% revenue growth and reached EUR 121.6 million in revenue in the second quarter. Organic growth was 12% with double-digit growth in Specialty Pharma, MedTech and Veterinary Services, our 3 largest segments, 6% contribution from acquisitions, and we had a 1% negative impact from currency movement. Adjusted EBITA grew 17% to EUR 29.7 million with strong earnings growth across all 4 segments. Margin improved to 24.5%, driven by the consolidation of acquired businesses in MedTech Dental segment.

Moving into Specialty Pharma. Specialty Pharma delivered another strong quarter with organic growth of 14%. All 4 therapeutic areas delivered solid growth and the strongest contribution in this quarter comes from Specialty Pharmaceuticals and Specialized Nutrition. In Specialized Nutrition, we completed another successful sales campaign together with a U.S. retailer. A similar campaign took place in the third quarter of 2025. These campaigns make growth vary between quarters, but the underlying business momentum is continued.

During the quarter, we also launched 25 new products and opened our new R&D hub in France focused on development of biological pharmaceuticals. Adjusted EBITA grew 13% to EUR 15.4 million, and we maintained a strong margin at 30.1%. Before we move on to the other segments, in our last quarter presentation, we gave you a short business snapshot about our MedTech Dental platform and Veterinary Services upcoming market expansion. In this quarter, we will continue our series of business snapshots by giving -- by having Carl-Johan giving some more insight into our innovation work within Specialty Pharma.

Thank you, Ali. And let me spend a few minutes on innovation as I've had the pleasure for the last couple of months to be close to the Specialty Pharma team and segment working as interim responsible for the Specialty Pharma segment. So innovation is really at the heart of Specialty Pharma's growth strategy. Innovation is one of the 4 pillars of our strategy. We focus on identifying unmet clinical needs and bringing differentiated products to market through internal R&D, scientific collaborations and selective partnerships. This approach is delivering consistent output. Over the last 12 months, we've launched 75 new products and have more than 60 additional products in the pipeline. These products span multiple therapeutic areas and technologies, creating a balanced and sustainable innovation engine.

As you can see from the quarterly launch cadence, innovation remains a continuous process, supporting long-term organic growth and reinforcing our leadership positions in attractive specialty markets. Let me now make our innovation strategy a little bit more tangible by looking at 2 of our therapeutic areas, Allergy and Specialty Pharmaceuticals. In Allergy, our ambition is to further strengthen our position as a global leader in veterinary allergology. PAX2 is a great example of that and a further innovation of PAX, the Pet Allergy Xplorer that we launched 3 years ago. By incorporating an additional 25 novel allergens identified by Nextmune, we're further enhancing the clinical value of our diagnostics platform with commercial launch targeted around one of the world's largest dermatology congresses, ESVD-ECVD in the autumn of 2026.

In Specialty Pharmaceuticals, our ambition is to build differentiated compounded drugs portfolio through internal innovation, combined with partnerships with biotech companies and leading universities. One example of how we're delivering on this ambition is through our newly established division Nextmune Bio. Nextmune Bio significantly strengthens our biological capabilities through a dedicated R&D team, a development facility and an established biologics pipeline, creating a platform for future prescription innovation across therapeutic areas.

Our innovation strategy extends beyond prescription diagnostics and prescription drugs and into our OTC portfolio, where we continue to develop differentiated products addressing clear unmet needs. In dermatology, our ambition is to strengthen our leading position in skin and hair care through continued innovation while leveraging that expertise to expand into adjacent therapeutic areas. A good example is IryLac, our first in-eye ophthalmology OTC product. It expands our presence into eye care with a preservative-free formulation designed to restore tear film stability and improve patient comfort.

In Specialized Nutrition, our ambition is to continue building a differentiated portfolio of nutritional solutions based on scientific evidence and targeted innovation. A good example is UNA 10, a microbiota-focused supplement supporting gut health. Its differentiated formulation enables targeted release and reflects our focus on translating science into products that address real clinical needs. Across our therapeutic areas, our approach is consistent. Focused R&D investments, a deep understanding of unmet clinical needs and a steady pipeline of differentiated innovations. Together, these capabilities provide a strong foundation for sustainable organic growth in Specialty Pharma.

Thank you very much, Carl-Johan. Moving on to MedTech. MedTech returned to double-digit growth of 11% with double-digit growth both in the dental and orthopedic business. As expected, our U.S. orthopedics business returned to growth on the back of our consistent efforts to strengthen commercial performance and operation despite unchanged market conditions. Our focus on education to unlock long-term market growth in both orthopedics and dental remains, and we educated over 1,300 veterinarians in the quarter. Adjusted EBITA grew 27% to EUR 11.2 million and adjusted EBITA margin improved to 25.8%, mainly driven by the consolidation of acquired businesses in the veterinary dental part of the segment.

Moving on to Veterinary Services. Veterinary Service continues its momentum and delivered a strong organic growth of 10% with continued momentum in new member growth and strategic partnerships. At the end of the quarter, we reached 11,900 members across 4 continents. Adjusted EBITA grew 18% and the adjusted EBITA margin reached 28.2%. As expected, somewhat lower than previous year due to mix effects from acquisitions and our communicated growth investments in new markets and services.

Looking into Diagnostics. Diagnostics delivered 7% organic growth in the quarter. Adjusted EBITA grew 32% and adjusted EBITA margin of 9% was driven by product mix with higher level of extraction sales.

We communicated earlier this year that we entered 2026 with a strong M&A pipeline, and we see continued improvement in our M&A activities and momentum. We have year-to-date closed 4 acquisitions and continue to have a very active -- activity and pipeline going forward as well across all 4 segments. The latest acquisition is the crematorial business that Verona Pet, within our diagnostics business in Italy.

From a sustainability perspective, we continue to deliver our sustainability agenda. In spring, we received further recognition through the rating upgrade from AA to AAA within MSCI. We are now among top 19% of MSCI-rated peers globally and a leader among 153 Health Care Equipment & Supplies companies.

This concludes the run-through of the quarter, and I will hand over to Carl-Johan for deeper insights into the financials.

Thank you, again Ali, and let's jump into the -- more specifically on the numbers for the second quarter. Adjusted EBITA in the second quarter was EUR 29.7 million, corresponding to an increase of 17%, and that translates into an adjusted EBITA margin equal to 24.5%. The margin increase compared to the same period last year is primarily a result of positive margin development in our MedTech dental business. Central costs amounted to minus EUR 3.0 million, an increase from minus EUR 2.2 million last year. This increase is mainly a result of expenses related to our long-term incentive programs in total EUR 0.8 million in the quarter. And during the end of the second quarter, we implemented LTI '26 as approved by the Annual General Meeting in April, where we will see the full effect from the third quarter and onwards. These are non-cash IFRS expenses that will recur for the duration of the 3-year programs.

We reported an operating profit of EUR 22.3 million, a significant 54% increase from last year's result of EUR 14.5 million. Items affecting comparability decreased in the quarter compared to the same period last year and totaled minus EUR 0.9 million. The majority of items affecting comparability relates to acquisition costs in Veterinary Services and in Diagnostics of total minus EUR 0.5 million. Net financial items amounted to minus EUR 8.0 million and consisted of 3 main parts. Financing expenses of minus EUR 3.1 million with an average interest rate of 3.9% during the quarter, partly offset by interest income of EUR 0.2 million. A quarterly discounting impact of minus EUR 1.0 million and a negative impact of EUR 2.5 million from probability adjustments related to contingent considerations, mainly relating to new acquisitions.

A negative impact of EUR 1.6 million from exchange rate effects on the revaluation of debt. Income tax expense for the quarter was minus EUR 5.5 million at an effective tax rate of 39%. In the quarter, the tax expense as a percentage of pretax profit was negatively affected by probability adjustments related to contingent considerations and other non-deductible expenses. In total, this results in a profit for the period of EUR 8.8 million with an earnings per share of EUR 0.02 for the quarter.

Looking at cash flow from the second quarter, where cash flow from operating activities reached EUR 3.8 million for the second quarter. The operating cash flow was negatively impacted by timing of taxes paid and net working capital effects. Net working capital amounted to EUR 114.1 million at the end of the quarter, equal to 26% of revenue, an increase from EUR 92.8 million at the end of the first quarter, which equaled 21% of revenue. The majority of the EUR 21.3 million increase in working capital relates to increase in receivables after a strong finish to the quarter as well as specific inventory buildup to support continued customer demand.

Cash flow from investing activities amounted to minus EUR 22.9 million, primarily consisting of acquisitions and earn-out payments. And finally, cash flow from financing activities of EUR 20.5 million from proceeds from borrowings. At the end of the quarter, net debt amounted to EUR 273.7 million, which is up from EUR 258.4 million at the end of the first quarter. Cash and cash equivalents amounted to EUR 51.6 million, an increase compared to EUR 50.4 million at the end of March, with external lending of EUR 261.7 million at the end of the second quarter. All in all, this resulted in a leverage at the end of the quarter equal to 2.1x, unchanged compared to the end of the first quarter. And we continue to be well capitalized with an ability to execute on our strengthened acquisition pipeline.

With this financial review, I hand the word back to Ali for concluding remarks.

Thank you, Carl-Johan. Summarizing the first half of 2026, I'm pleased to see that improved execution of our 3 strategic focus areas have been successful. The quarter was strong with double-digit organic revenue growth, strong earnings growth and improved margin, all well ahead of the global animal health market. We've closed 4 acquisitions year-to-date and have a highly active pipeline across all 4 segments. For the remainder of the year, during the second half, our focus will be on executing on our M&A pipeline while continuing to drive strong organic growth and building strong culture. Thank you for your attention.

And with that, we can open up for Q&A.

[Operator Instructions] The next question comes from Kavya Deshpande from UBS.

I've got 2, please. My first one was on U.S. Vet Ortho growth. So your comps look a little bit tougher in the second half of the year or more like flattish growth versus double-digit declines in H1. Should we continue to see sort of organic growth at a low single-digit level here? Or is your strategy making you think that an acceleration actually might be possible here? And my second question was around the spread of margins between Dental and Vet Ortho. It seems like this is quite different today to where it used to be given the investments in Ortho and the margin expansion in Dental. Would be able to get a sense of sort of, yes, where they sit today, please?

Thank you for the questions. I think if I start off with your first question, we expect that the changes we've implemented to drive kind of continued growth in the U.S. Orthopedic business will continue, and we expect a continuous low single-digit growth in the second half of the year as well. We still see unchanged market conditions. The market is soft. So depending on how the market develops as well, that could, of course, impact that number, but we're very happy and confident with the management team and the execution of the changes we implemented in the last 6 months.

And on margins, so overall for the MedTech business, I think we have a good margin business within MedTech in total. If we take Orthopedics and Dental more specifically, in Orthopedics, as communicated, we have taken deliberate and focused investments to make sure that we get back to growth, as Ali just mentioned. But we do see, as we continue on the growth path, those investments -- or we will make -- those investments will make sure that we continue on the growth path and improve margin steadily over time within Orthopedics.

In Dental, we continue to improve the margins, both operationally and in the second quarter, there's also been an impact with the addition of AllAccem that we acquired June last year, and we get the full effect this quarter that has a higher margin profile than the rest of the MedTech and the Dental business. But all in all, we see that MedTech is developing positively, and we are confident that with continued growth, we'll see steady margin improvement in the segment over time.

If I could just ask a quick follow-up on that Dental margin, please. How far do you feel you are from sort of the ideal margin for that business? I mean I understand the gross margin in general is a little bit lower in Dental than for Ortho. But I mean, could we feasibly ever see the Dental margin sort of in the 30s like that Vet Ortho used to be before the U.S. market decline?

So we definitely believe in the Dental part of MedTech that we will continue to see margin improvement, then we will continue to invest for future growth as well because I think as you see in this report and what we believe going forward, there are a lot of interesting opportunities in Dental segment where we want to make sure that we invest for continued solid growth in our Dental business. While having that said, we do see that margins will improve over time also in the Dental area within MedTech.

The next question comes from Arvid Necander from DNB Carnegie.

So the first one on Spec Pharma. I was just wondering if you can quantify the contribution from the national sales campaign? And I guess just overall, how would you characterize the underlying demand in the different subsegments here?

And then secondly, on M&A, you seem to be increasingly positive on the outlook here and highlighting a highly active pipeline. So should we expect the activity to accelerate in the second half of the year? And I guess, overall, how would you characterize the size of the opportunities that you're more upbeat on for the near term? I'll start there.

So let me address the first question regarding Spec Pharma. So we haven't disclosed the sort of the total size of this national sales program that we did in Q2 of this year that we did Q3 of last year. The program implemented this year is a little bit larger than the program we did last year. So there is a positive effect from that sense. As Ali communicated during the presentation, we will see, you can say, an effect of the program being implemented in Q2, having a good contribution, whereas we will see, you could say, the flip side in Q3 where we had the program last year. Having that said, so the organic growth adjusting for the national sales program in the second quarter of this year was 9%.

And going back to sort of your second part of the question, what I'm encouraged about is that we see a good growth and underlying momentum in all the therapeutical areas within Specialty Pharma. We did have sort of very strong growth in U.S. Specialized Nutrition on the back of the national sales program, but the other therapeutical areas grew well as also in the quarter and for the first half year.

Moving on to the second question. So as we said before, we enter 2026 with a stronger pipeline than before. We've built upon that pipeline in the last few months, and I feel positive about the opportunities of welcoming new strong businesses and entrepreneurs during the second half of this year. But it's difficult to speculate exactly when and how because key for us is always to make sure it's the right acquisition with the right valuation and so forth.

So all in all, we are positive about the conversations and the attractiveness we can offer strong entrepreneurs in the animal health space. In terms of size, it's a mixed bag. We see both smaller bolt-ons and bigger acquisitions in the pipeline. Exactly when and how and if they materialize depends on how the development goes during in the second half of the year. But we remain equally optimistic about our business momentum we currently have as well as our M&A momentum.

The next question comes from Jon Unwin from Barclays.

I actually just wanted to follow up on the Dental margin question. I think you gave some good detail. But when you acquired iM3, I think the margin in that business was like high teens, low 20s. Is that materially different today? Have you managed to improve it? Or -- and I'm thinking excluding the AllAccem acquisition, just thinking more about iM3 specifically. That's my first question.

And then in Vet Services, over what time frame do you expect the investments that you're doing in organic growth to sort of be complete and also to translate into the organic growth you want to see?

And then my third question is on in Orthopedics in MedTech. The market you said in the U.S. remains soft, but how are you thinking about the market and the growth possibilities outside the U.S. sort of in the back half of this year and into next year?

Thank you. And let's start with the margin question on Dental and excluding AllAccem. So yes, we have seen a positive margin trajectory since the acquisition of iM3 and the other bolt-on acquisitions that we've done, excluding AllAccem in Dental. So there's been a sort of underlying positive margin trajectory in the dental business, excluding AllAccem as well.

To the second question in terms of Veterinary Services and the investments and the margin, I think we talked a bit more deeper into the market and service expansions we're doing in the last quarter of the presentation. And as we see the margin of Veterinary Services is improving quarter-by-quarter on the back of the development of the business. We believe that a healthy margin in Veterinary Services should be around 28%, which is where it is today. And it normally takes us 1.5 years to -- 12 months to 1.5 years to break even in new markets when we enter that from a veterinary service perspective.

In terms of the third question, which I believe was in the MedTech Ortho outside of U.S., we've now had 2 quarters with double-digit growth outside of the U.S. markets in Europe and APAC. We see strong momentum in the business and the combination of our market position, product portfolio and quality and the team we have, we believe we can continue strong momentum outside of the U.S. for the rest of the year as well.

The next question comes from Adrian Elmlund from Nordea.

I just have one question really. It's been a couple of months now with you as acting Head of Specialty Pharma, Carl-Johan. Perhaps like could you give us any updates on the search of this permanent segment head? And if not, if this extends for a longer period, like what are your plans for these segments?

So the recruitment for a new Head of Specialty Pharma is ongoing. It's been a couple of months, but always when you look into recruiting a senior hire in the management team, you want to ensure you take the time to find the right profile of candidate for not just Specialty Pharma, but Vimian as a whole. At the same time, I'm extremely happy with how Carl-Johan and the rest of the team has managed and developed the business during the last 6 months. I would like to remind that we run a very decentralized model. So our 4 therapeutic areas have strong leaders, which is reflected upon the performance of the business these last 2 quarters. So we want to make sure we find the right candidate, and it takes the time it takes to do so. During that time, I'm very confident that the Specialty Pharma business will continue to build upon its business momentum. And as you saw Carl-Johan presenting, there's a lot of exciting innovations, product developments and so forth going on in the segment to enable future growth.

Right. Okay. Fair enough. Just one quick follow-up. Maybe I missed this, but you have some 60 products in the pipeline, right, for Specialty Pharma. Is there anything like especially of interest in that pipeline that we should take note of?

Sort of in that development pipeline, it's a mix of, call it, both improved formulations of existing products, you could say, life cycle improvements as well as, call it, larger or more sort of exciting innovations. But it's a mixed portfolio across our pipeline of roughly 60 products today. But near term if you...

[Operator Instructions] The next question comes from Sten Gustafsson from ABG Sundal Collier.

To start off with a clarification maybe on -- I think you talked about in one of the first questions about the expected growth rate for the MedTech division in the second half, if you -- and I didn't get the number, if you could maybe comment on that.

And then secondly, with regards to the sort of transformation that you have done in the U.S. MedTech business, are there more actions for you to take there? Or is this sort of now all set and we're basically seeing your execution on actions you have already taken?

Sten, thanks for the question. So I think when you, from an operational standpoint, look into implementing changes and improving the business, it is continuous improvement. So although we've done some, if we call it larger changes, we have a new Head of MedTech in place, and Lotta, and so forth. I believe Lotta and the rest of the management team and will continue to tweak the business to make sure we are where we want to be and continuously improve. And that's the same case across all 4 of our segments. So I am expecting continuous tweaks, changes to make sure that we are where we want to be and that we are prepared to unlock the potential and the white space within this -- within MedTech and Orthopedics and Dental going forward.

In terms of growth in MedTech in the second half, we don't give specific guidance, but we believe that the changes we've implemented in U.S. Orthopedics and as well as the business momentum we have across MedTech in general with double-digit growth in the quarter allows us to enter the second half of the year with good momentum. But as I also said, the U.S. orthopedic market in the U.S. is continuously soft. So depending on the development of that, you could get head or tailwinds as well. But in general, we're confident about the performance of the team. We're confident with the products we have in our portfolio, and we believe that we have the right management in place to make the continuous enhancements and improvements in the business to unlock future growth.

The next question comes from Kavya Deshpande from UBS.

It's me again. I was wondering if I could ask a follow-up on the operating receivables point, please. I was just wondering if the increase was related in any way to the transformation strategy in Ortho. I know you've been trying to push on education efforts and get new GPs implanting and similar industries that sometimes comes with working capital effects. So yes, I was wondering if there was a link there. And if so, should we continue to expect high receivables for the rest of the year?

Yes. Thank you. No, I would -- so receivables in the quarter, I say working capital was higher in the quarter than what we've seen in previous quarter and also in relation to sales. As I said, that was mainly an effect of higher receivables and the higher receivables was driven by a very strong finish of the quarter that drove up receivables, which we will see -- will normalize during the third quarter. And it was not related to any sort of specific initiatives within MedTech.

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. As I said before, we're very happy with the start of the year and finishing off the second half of 2026 with double-digit growth. We're pleased to see business momentum across all 4 of our segments and the active M&A pipeline we have gives an exciting future ahead being able to welcome strong entrepreneurs into the Vimian family. With that said, I wish all of you a good upcoming summer and look forward to get back to you during the second half of the year. Thank you.

Welcome to Vimian Group Q1 Report 2026 Presentation. [Operator Instructions]

Now I will hand the conference over to the speakers, CEO, Alireza Tajbakhsh; and CFO, Carl-Johan Zetterberg Boudrie. Please go ahead.

Hello. Good morning, everyone, and welcome to Vimian's First Quarter Earnings Call 2026. I'm Ali Tajbakhsh, Group CEO, and I will present the first quarter results together with our CFO, Carl-Johan Zetterberg Boudrie.

Q1 is always an active period for us at Vimian with strong cadence of industry and client events. This provides an early read on customer sentiment, I get valuable feedback across our group businesses, opportunities to engage with industry peers and so on. It's encouraging to see that the strong traffic growth, high engagement and the positive feedback I get from veterinarians from these events are also reflected in the strong start to the year with positive momentum across the group.

Three out of 4 of our segments, Specialty Pharma, Veterinary Services and Diagnostics all delivered double-digit growth in the quarter, well ahead of global animal health market.

We completed 2 acquisitions in the quarter, a diagnostic company, I-Vet, in Italy and the innovative Danish clinic group, Favna. These 2 acquisitions will add in total around EUR 10 million in annual revenues.

This morning, we also signed the acquisition of veterinary service business, Vetsave, with revenues of EUR 1.6 million. This marks the entrance into Ireland for our Veterinary Services segment. Our M&A pipeline going into 2026 is fruitful, and we have a strong position as a natural home for ambitious entrepreneurs within animal health.

Operational cash conversion remained strong in the quarter, being above 70%. And on April 13, we welcomed Lotta Lundaas as Head of MedTech, adding vast experiences running entrepreneurial businesses based out of the U.S.

Turning into the quarterly numbers. We report 8% revenue growth and reached EUR 116 million in revenues for the first quarter. We delivered strong organic growth of 9% ahead of the market, driven by Specialty Pharma, Veterinary Services and Diagnostics, 4% contribution from acquisitions and 5% negative impact from currency movements.

Adjusted EBITA grew 3% to EUR 29.2 million or 8% adjusted for negative currency impact. Margin of 25.2%, given our planned investments to drive growth in MedTech and orthopedics and new market entries within Veterinary Services.

Going into Specialty Pharma, Specialty Pharma delivered a strong quarter across the board with double-digit growth, improved profitability and strong cash generation. The organic growth of 10% was driven by double-digit growth in 3 therapeutic areas, while the strongest contribution came from Allergy and Specialized Nutrition, where growth was supported by key customer wins in the past month.

We continue to execute our strategy of innovation, education and cross sales and launched 17 new products and 4 new cross-sales initiatives in the quarter. We established a direct sales force in Switzerland and Finland and started to cross-sell our compounded pharmaceutical products in Scandinavia.

Adjusted EBITA grew 11% to EUR 14.4 million or 15% adjusted for negative currency impact. Margin improvement -- improved significantly from 28.8% to 30.3%, driven by operating leverage across the business.

Moving on to MedTech. In MedTech, we delivered 6% organic growth, driven by double-digit growth in our dental business and in our orthopedics businesses in Europe and APAC, where all markets delivered healthy growth. Several of our European orthopedic markets delivered all-time high quarter, and we continue to strengthen our sales team and education teams in the region.

In U.S. orthopedics, we onboarded our new field sales force with a lot of focus on getting them ready and training and continue to drive sequential sales improvement in a challenging market. We attended several key congresses in the quarter and continue to see our high-quality orthopedic brands enjoy a strong reputation in the global veterinary community. As previously communicated, we expect changes we have implemented in orthopedics to enable U.S. orthopedics to return to organic growth later in spring.

Adjusted EBITA declined 2% to EUR 11.9 million or grew 6% adjusted for negative currency impact. The adjusted EBITA margin was 27.1%, which is a strong sequential improvement driven by very strong performance in our dental businesses in the quarter. Year-over-year margin was impacted by geographic mix and our investments in orthopedics to strengthen commercial performance in particular in the U.S., where we are seeing effects of those investments.

Two weeks ago, Lotta Lundaas joined us as Head of MedTech as well, and we have already felt the energy and experience she brings into the organization from building and scaling entrepreneurial organization with strong financial track record. Overall, being close to the MedTech business up until Lotta joined us, I'm confident that we are fully on the right track to get our MedTech business and in particular, the U.S. orthopedic business, back on track, and we have the right people to continue to strengthen the commercial performance across the board.

Before I move on to Veterinary Services, I would like to spend a few minutes using or highlighting the Medtech dental operation as a clear example of how we at Vimian create global opportunities, combining M&A experience or expertise with operational excellence to build global leading platform and long-term shareholder value.

In October '24, as you all know, Vimian acquired iM3, making our entry into the veterinary dental niche. The companion animal dental market is both large and attractive, growing above industry average and clinicians believe that this will be the fastest-growing category at the veterinary clinics in coming years. 80% of cats and dogs are affected by dental diseases, which makes the unmet need significant.

At the same time, there's a clear structural gap. Dentistry typically receives only scarce attention in vet schools and many clinics still offer limited dental services despite strong clinical needs and revenue potential. But growth in the segment is further driven by humanization of pets and increased demand from veterinarians for continued education in dentistry.

For Vimian, bringing a successful entrepreneurial and fast-growing global platform like iM3, offering a wide range of services such as equipment, imaging, consumables, home care and software allows us to create new touch points for us and gives us attractive growth opportunities.

So looking at those growth opportunities or those we touched on, gives us, for example include, targeted bolt-on acquisitions such as we did with DentalFocus, deepening our U.S. imaging capabilities and our [ Sanos funnel ] to expand our geographic reach and broaden the portfolio, taking a proven and innovative dental sealant product from one market, expanding it to the rest of the world as well as in strategic M&A or strategic investments or transformational investments like the acquisition of David AI, which leverages technology to improve workflow and embedding dental education into clinical routine.

The more clinics continue to expand into dental services and deepen their knowledge of dental, our average revenue per clinic also increases, given the broad range of services we offer within dental. While we currently remain in the early stages of this growth journey, I'm pleased to see the development we've had in the business post-acquisition and some of the initiatives we've done since.

Since I joined, we've established a multichannel sales team. We strengthened our consumable offering and launched subscription models, driving recurring revenues at good margins. We invested in a new warehouse facility to facilitate growth and launched our first U.S.-based education center. We launched a new successful dental unit called the Evolution Range. And on the back of the David AI acquisition, we launched proprietary AI-powered imaging software systems.

We are also clearly exploring cross-sales opportunities with the broader MedTech segment and have set up joint education initiatives or activities and shared facilities for orthopedics and dentistry. Since the acquisition, our dental platform has delivered double-digit revenue growth with expanding margins, and we are optimistic about the organic M&A opportunities we have ahead in this space.

Continuing to Veterinary Services, our global veterinary service platform continues to show strength and again delivered double-digit organic growth, being 11% in the quarter with continued momentum in member growth and conversion into higher tier under Michael's leadership. At the end of the quarter, we reached 11,400 members across 4 continents and adjusted EBITA grew 3% to EUR 4.8 million with an adjusted EBITA margin of 27.5%, given the strategic growth investments and temporary lower margin in some of the co-owned clinics.

The demand of our services from both veterinarians and partners increases every day. And with today's development of AI, we see our ability to develop new enhanced existing services to our customers at a faster pace than before.

Last year, we shared that on the back of the success we had in Veterinary Services, we were also planning to do additional investments, as you've seen in the numbers this quarter, by expanding into new markets and new services. Therefore, I would like to give some more insights into some of those market expansion investments.

Firstly, we have, since second half of 2025, prepared our organic expansion into 3 new markets, one being Japan, unlocking a large market for Veterinary Services following the successful MedTech launch in Japan. In Japan, probably it's around -- it's a top 10 market when it comes to animal health, depending on which numbers you look at, you could argue it's probably the fifth or sixth biggest market as well. And there's approximately 10,000 clinics in the Japanese market. And we expect to launch our Japanese operations in Q3, but we already have people on the ground as of today preparing for that launch in the market.

We're also preparing to do our adjacent market expansion by going into Portugal. We've had a very successful growth and momentum in our Spanish operations. So we see Portugal as a natural add-on to our Iberian footprint, leveraging the existing team we have in the territory and adding local skill set and excellence. The Portuguese market has approximately 1,500 clinics, and we expect to launch in Q3 as well.

Beyond our organic expansion, the team always looks into finding relevant companies in other markets to acquire. And we're very happy that this morning, we signed an agreement to acquire Vetsave, the leading veterinary service organization on the Irish market. The Irish market is approximately -- has approximately 700 clinics and Vetsave has approximately 150 clinics currently working together with them. This deal is expected to be completed in May.

So based on the back of these 3 initiatives, combination of organic and M&A, which is how we operate, we are now taking our veterinary service platform from 11 to 14 markets globally, unlocking long-term growth and additional scale benefits.

Moving on to Diagnostics. Diagnostics delivered double-digit growth of 12% in the quarter, positively impacted by disease outbreak towards the end of the quarter, mainly from the Avian influenza outbreak in the U.S. and [ meningitis] in Europe. On March 2, we consolidated the diagnostic business, I-Vet, an important milestone to strengthen our companion animal offering and onboarding a strong entrepreneur and a strong team for our diagnostics business.

Adjusted EBITA grew 16% to EUR 1 million and the adjusted EBITA margin declined slightly to 13.8%, driven by product mix with higher levels of extraction sales in the U.S. Looking ahead, we're excited about the opportunities to further strengthen our position in the attractive companion animal markets.

From an M&A perspective, we covered that in the segment sections, but we've made 3 acquisitions year-to-date and are advancing our M&A pipeline across the segments. We're very optimistic about looking at the pipeline we've generated and created and entered with it during 2026. And we truly feel that we are the natural home for entrepreneurial business leaders in the animal health sector.

From a sustainability perspective, we continued to deliver our sustainability agenda in the quarter. On March 19, we released our first CSRD compliance report. In February, we completed our biannual employee experience survey with high participation rate and further strengthening the employee experience scores.

In March, we also completed our fourth cohort of Vimian leadership development program. And in total, over 80 of our leaders have gone through one of these programs to develop and get to know colleagues across the world.

In one of our largest production facilities in Italy, we installed solar panels during the quarter, covering the majority of the site's electricity needs and strengthening our resilience against grid volatility and rising energy costs.

With that, that concludes the run-through of the quarter, and I will hand over to Carl-Johan for deeper insights into the financials.

Thank you, Ali, and good morning, everyone. I'll dive straight into the results for the quarter. Adjusted EBITA in the first quarter was EUR 29.2 million, an increase of 3%. In constant currency, the increase corresponds to 8%. The adjusted EBITA margin for the quarter equaled 25.2%, where the margin decrease compared to the same period last year is primarily a result of focused investment in MedTech orthopedics to strengthen our commercial platform as well as investments in new markets and services in our segment, Veterinary Services.

Central costs amounted to minus EUR 2.9 million, an increase from minus EUR 2.3 million last year. The increase is mainly a result of expenses related to our long-term incentive programs, in total, EUR 0.6 million during the quarter. These are noncash IFRS expenses that will recur for the duration of the 3-year programs.

We report an operating profit of EUR 21.2 million, a significant 36% increase from last year's result of EUR 15.6 million. Items affecting comparability decreased in the quarter compared to the same period last year and totaled minus EUR 1.8 million. The majority of items affecting comparability relate to MedTech. This consists of minus EUR 0.7 million in litigation costs in the U.S. indemnification dispute and EUR 0.5 million in acquisition costs. Acquisition-related costs amounted to EUR 1.1 million in total for the group.

Net financial items amounted to minus EUR 3.3 million and consisted of 4 main parts: financing expenses of minus EUR 3.1 million with an average interest rate of 4.1% during the quarter; a quarterly discounting impact of minus EUR 1.3 million and positive impact of EUR 0.2 million from probability adjustments related to contingent considerations; a positive impact of EUR 0.9 million from exchange rate effects on the valuation of debt; and lastly, the quarter was also burdened by a write-down of shares and associates amounting to minus EUR 2.5 million.

Income tax expense for the quarter was minus EUR 5.3 million at an effective tax rate of 35%. In the quarter, the tax expense as a percentage of pretax profit was negatively affected by the nondeductible write-down of the shares and associates together with other nondeductible expenses. In total, this results in a profit for the period of EUR 10.1 million with an earnings per share of EUR 0.02 for the quarter.

Looking at the cash flow, the cash flow from operating activities amounted to EUR 23.0 million, corresponding to a cash conversion of 73% for the first quarter, cash conversion being measured as operating cash flow in relation to EBITA.

Net working capital amounted to EUR 92.8 million at the end of the quarter, equal to 21% of revenue, a decrease from EUR 96.6 million at the end of the fourth quarter, which equaled 23% of revenue. The majority of the EUR 3.8 million decrease in working capital is relating to an increase in payables.

Cash flow from investing activities amounted to minus EUR 33.6 million, primarily consisting of acquisitions and earn-out payments, and cash flow from financing activities of EUR 5.1 million from proceeds from borrowings.

At the end of the quarter, net debt amounted to EUR 258.4 million, up from EUR 245.4 million at the end of the fourth quarter. Cash and cash equivalents amounted to EUR 50.4 million, a decrease compared to EUR 55.0 million at the end of December. External lending was EUR 230.2 million at the end of the first quarter.

This resulted in a leverage at the end of the quarter equal to 2.1x, which is an increase from 2.0x at the end of the fourth quarter. We still remain well capitalized with an ability to execute on our strengthened acquisition pipeline.

With this financial review, I hand the word back to Ali for concluding remarks.

Thank you, Carl-Johan. Vimian is off to a good start to the year with double-digit growth in 3 out of 4 segments and strong cash generation. We welcomed 3 new businesses year-to-date and remain positive about the M&A opportunities throughout 2026 and beyond.

All in all, we are well positioned with a robust strategy and continue to execute our organic and inorganic growth initiatives to build a global leader in attractive animal health niches.

Thank you for your attention, and we'll now open up for Q&A.

[Operator Instructions] The next question comes from Adela Dashian from Jefferies.

A couple of questions from me. If we can maybe first start on the MedTech development. Do you have any more color to offer on what the growth was in U.S. orthopedics during the quarter?

Yes, the growth in U.S. orthopedics was a slight decline, given the market -- current market situation, but we see a sequential improvement from the previous quarter.

Glad to hear that. And if that is the case, I mean, with the heavy investment pace, do you feel like this is necessary to keep up? Or at what point do you feel that it's time to maybe phase it down a bit to, I guess -- once you're able to capture the market opportunities and so on?

I think the investments we're talking about in particular and what we've done is, of course, put together an outside sales team. That was in place in the beginning of the year as well. When we have a new sales team in place, it requires some training and education to get up to speed. I don't believe we have so far gotten the full effect of the capabilities of the sales team in the U.S. It's a strong team in place, and I believe that with the measures we've taken into account as of end of Q4 and going into the quarter and what we've done in Q1, we are well prepared to bring back U.S. orthopedics to organic growth later this spring.

So with that being said, we should expect a normalization of the investment pace in the coming quarters?

Yes. Just to clarify, the investment is in people. So the investment we've done will remain from an OpEx perspective. But of course, we expect the revenues to increase as we move ahead.

Sure, sure. Great. And then on Diagnostics, there were some comments around mix affecting your profitability here. Could you maybe speak a bit more of that and how you expect that to proceed for the remainder of the year?

Yes, sure. So in Diagnostics, and as you know, there is some volatility from quarter-to-quarter in the revenues as part of the business is driven by outbreaks. And depending on sort of the regional mix and the outbreak mix, that could have an impact on margins in the quarter as certain products we sell for certain outbreaks in certain regions carry a different margin profile. And that's what happened in the quarter. From a mix perspective, where we enjoyed good revenue from outbreaks, but the mix was a little bit different, which impacted margins in the quarter specifically.

Is there anything you could say about the mix effect going into the second quarter?

I would say sort of what happens with outbreaks is difficult to predict. If we look sort of -- and I would think about it as thinking sort of from a normal margin perspective for Diagnostics, excluding the outbreak effect.

The next question comes from Adrian Elmlund from Nordea.

I think I have 3 questions. So you mentioned here that you're going into Japan, right, through organic growth. It looks like it's a market of total 10,000 clinics, so it's quite a lot. What costs are we talking about here when going into this market? I presume that it will take a time before you reach sort of segment average margins. How long do you think that can take? What kind of expectations do you have on the growth rates and also in the competition? Because I assume that Japan is a bit of a tricky country, right, to -- at least for a lot of companies I've spoken to previously, but -- if I'm not mistaken. Do you have any comments regarding Japan?

Yes. So I think Japan is an interesting market. It's a market we looked into for a long period of time. There are obvious differences in the Japanese market versus Europe and so forth. So we have invested in a local Japanese team that will operate and run the business in the market. It's a market we know well, given the work we've done.

And actually, the reason we chose Japan as a site is that we have received a lot of inbound from both clinics and our partners that the model we offer and the value we bring is very relevant and would we consider entering that market. So I think it's a good opportunity for us and there is a demand, but the model we offer is new to the market. So it's something we will, if we call it, educate the market together with our partners.

In terms of upcoming growth perspective, I think what we can say is we're going to launch in Q3. As always, we put a local team on the ground supported by a strong team based out of Stockholm. So it will take some time both to get the contract and the services in place and as well build up the member base going forward. Normally, I would say it takes approximately a year to 1.5 years for us to break even out.

Did you say break even? Or did I miss that?

Yes.

Okay. Perfect. Similarly, are there any comments you can give on the acquisition here entering Ireland regarding its growth rates or margin contribution, et cetera?

So the Irish business have a higher margin profile than the veterinary service average. It's a strong platform where the entrepreneur will stay on and continue to journey together with us. And we believe that the local -- the strong local positioning Michael and his team has in Ireland, together with the experience and all the value-added services we can bring to the market, is a very good match going forward.

Right. If the group margins -- or if the margins in Ireland is higher than the kind of segment margins, does that mean that the growth rates are slower than the average as well?

No, I wouldn't think about it in that way. And of course, the business in Ireland, we think it's a great platform for Ireland. It's a good combination to what we do, and we see that we can bring our -- as Ali said, our knowledge, our experience, our service portfolio to the Irish market to drive continued revenue growth. The business in Ireland's currently -- from a site perspective, it's a good market for us, but it's not a huge market comparison to that family in total -- of veterinary services in total.

But yes, we do see good growth momentum and opportunities to continue in Ireland. And as Ali said, there is a margin profile that is higher than the rest of Veterinary Services. But given its size, it's not going to have, you can say, a significant impact on Veterinary Services margins going forward.

Right. Okay. Very good. Last question here, sorry for being kind of long. Regarding the U.S. orthopedics recovery here in the spring, could you give us any guidance with regards to the growth rates here as well? Are we speaking like low single-digit growth rates? Or are you expecting kind of a big push here in the spring?

I think there's 2 components. One, I think the team in place and the new leadership will continue to build momentum, but then there is a dependency on market dynamics as well. So the combination of the 2 of them would end up in the number. Given the current market, it's still fairly flat from Q1, if you look at April in particular. So we're expecting low single digits.

As we communicated also in the first quarter, we do see that we will get back to organic growth during later spring this year. And we see that we'll start to get back to single-digit organic growth. For us to get back to double-digit organic growth, that is our ambition, we need to start to see a market that is -- go back to growth trajectory again.

The next question comes from Kavya Deshpande from UBS.

I have one on Spec Pharma and then one on MedTech, please. So on Spec Pharma, would you be able to explain what drove the strength in the allergy and compounding businesses, please? I think I heard you say it was key customer wins from [ PAX ] and allergy, but it would be great to get some color on the compounding business. And then related to that, would you be able to say what the one therapeutic area that didn't grow double digits, what that was and if there's anything to flag there?

And then just on MedTech, so I was wondering if you could give us a bit more detail on this -- in the investment in the field sales force. So you have more people on the ground. Is the next step now more about training new GPs to perform these CCL implants? Is it about converting customers from your competitors? Or is the key approach about increasing utilization with your current customer base? And then related to that, are you looking to deploy price as a key tool? And is the increase in inventories this quarter, was that related to the strategic transformation or something else?

So let's start with the Specialty Pharma question. Positive from a Specialty Pharma overall perspective, we saw double-digit growth in 3 out of 4 therapeutical areas. So both Allergy, U.S. Specialized Nutrition and Specialty Pharmaceuticals showed double-digit growth in the first quarter. And for all those 3 therapeutical areas, you can say that the contributor driving double-digit growth was solid customer wins in late of last year, beginning of this year that contributed to good growth in the first quarter. And as I said, that goes across all 3 therapeutical areas that I mentioned.

The one therapeutical area where we didn't see double-digit growth was dermatology, but we did see high single-digit growth in dermatology. So I would say it's still solid growth in our dermatology business. And the main reason, I would say, for slight difference also is you can say the geographical mix a little bit in the different therapeutical areas. But again, all in all, good performance in all therapeutical areas and double digit in 3 out of 4 therapeutical areas.

Moving on to MedTech in terms of the sales team, I think what we -- as we spoke about it in the last quarter, we are moving from an inside sales team to an outside sales team, meaning we put people in territory and we're strengthening the sales team by adding more people to have a strong presence across the U.S. The reason we're doing that, of course, is to be much closer to our customers, being able to support them on a daily basis and also be able to pick up feedback from them, what they need and how we can support and drive the business going forward.

Clearly, with this transition being implemented in the quarter, there is a ramp-up, but I do believe we have a strong sales team in place. And as they learn our product, as some of them bring it to the industry as well with more customers and build relationships with them over time, I believe sales will pick up on the back of that. The ambition, of course, is to do kind of all of the things you mentioned in terms of gaining market share, protecting and developing the businesses we have, but also get more GPs and more veterinarians understanding our product and moving to that space and recommending our procedures.

Apologies, just to make sure I get the question and answer it -- so I could answer it, could you repeat your question regarding inventory?

Of course, just the increase in inventories, is that related in any way to the transformation? Or is that something else?

No, I wouldn't say the increase in inventory is relating to the transformation. If we look at the transformation, and I think if -- to look at MedTech, and we have 2 different areas within MedTech, being dental and being orthopedics. Dental is performing very well and to cater for continued good growth, we're making sure that we have sort of necessary inventory to drive the continued growth. For the orthopedics business, I think our work will continue to make sure that we optimize inventory levels within MedTech. And as we discussed last quarter, we did continue part of the product portfolio as well so that optimization of MedTech portfolio in the MedTech business within orthopedics continues.

The next question comes from Sten Gustafsson from ABG Sundal Collier.

So first of all, going back to vet services, would it be possible -- I mean, looking at these new markets in Japan, in particular, with the 10,000 potential new customers, given that you have over the 11,400 today, would it be possible to give us some sort of revenue potential for the new markets you're entering, I mean, midterm, not short term? But what kind of penetration rate should we think about there? And then secondly, going back to the MedTech division, if you could remind me of how much of the total revenue for, let's say, 2025 is related to U.S. orthopedic today?

So I can start with vet services. I think it's a bit early to kind of give a revenue projection. I think that the demand is there. We get positive response from the clinics. Key is, of course, [ not ] to have as many members as possible. We want to have engaging and member compliance rates being high to support what we do. So it is still early stage. As we said, we're going to launch in Q3, but we're happy with the team we have in place. And normally, we don't need to capture the full market to drive revenue growth and profitability.

So key for us initially is, of course, on the back of some key contracts, together with our partners and the experience we have in building an independent vet community, to explain the model to onboard members and start working together with them to enhance the daily operations into the clinic. But I think it would be a bit premature to indicate our revenue at this stage, although, of course, we do our math before we go into the market.

And then, Sten, your question regarding MedTech and orthopedics was the size of U.S. orthopedics in the MedTech segment. So as you know, orthopedics is the larger part of MedTech compared to dental and U.S. orthopedics is the largest region within the orthopedic space for us. In the quarter, roughly 50% of the orthopedics business related to North America and that in total is roughly 40% of the business for MedTech.

The next question comes from Jonathon Unwin from Barclays.

I just want to come back to MedTech and think about whether you need to see a market recovery later in the spring to get to that low single-digit percentage growth, or whether you think you can get to that number just from the investments that you've made in the field service organization, i.e., by starting to take a bit of share? And if you need to see an improvement in the market to get any growth in U.S. orthopedics, what gives you the confidence that the market is going to improve, given it's been flat for the last 2 quarters? That's my first question.

And then my second question is on EBITA growth. You grew 3% in the quarter, 8% constant currency. Do you expect that growth rate to improve throughout the year? And if so, what are the key building blocks to see higher EBITA growth through Q2 to Q4? And maybe if you could give some context around the contribution you expect from M&A versus organic on your expectations there?

I'll start with MedTech. So we believe that on the back of our operational initiatives initiated that we can bring the business back to low single organic growth later this spring, assuming the market remains where it is today, which is soft and fairly flat. If the market improves, I think that would accelerate our effort. If the market would substantially decline, well, of course, that could have an impact on the business as well. But we don't -- when we say we believe that U.S. orthopedics will return into organic growth in spring is on the back of the organic initiatives we have implemented and are [indiscernible].

And on the sort of profitability growth, looking at -- looking ahead and looking a little bit at the full year, so we are doing, as I said, conscious decisions or conscious investments, I should say, we've done in MedTech, in orthopedics and also in Veterinary Services, as we've discussed. They've had some impact on the margins, both looking at Q4 last year and Q1 this year.

As we start to see some of the effects of these investments that we've made in terms of higher revenue, to Ali's point, we'll see sort of a gradual improvement or gradual ramp-up of revenues, both in MedTech orthopedics and Veterinary Services. We believe that we will start to see, call it, margin normalize in those 2 segments, meaning that overall, we'll start to see margins or the relation between revenue growth and adjusted EBITA growth being more correlating for the rest of the year.

Having that said, and as we communicated earlier, given the investments that we've done now in the first quarter, we do not see that we will show any sort of significant margin improvement for the full year.

[Operator Instructions] The next question comes from Arvid Necander from DNB Carnegie.

So the first one on Spec Pharma. I was just wondering if you're able to clarify based on the current momentum and market environment that you're seeing, do you still believe you're on track to deliver double-digit organic growth for the full year? And then sort of on the overall market sentiment, the consensus seems to be that the animal health market will grow with about mid-single digits for the full year. But during the pandemic, dog ownership, of course, saw a significant uplift and some of your industry peers have now started to talk about the tailwind from this. So I was just wondering, do you expect that to be the case for your core franchises as well? And where do you expect to see the most meaningful impact over the next 1 to 3 years? I'll stop there.

I can start with the Specialty Pharma. We see a good momentum in the business. As we discussed, we've seen in the first quarter that we delivered double-digit growth in 3 out of the 4 therapeutical areas, high single-digit growth in the four therapeutical area. We've seen in Specialty Pharma also that we delivered high single-digit or double-digit growth for a long period of time. We don't have any indications that the good momentum that we've seen in Specialty Pharma will change for sort of looking ahead for the rest of the year.

Yes. And on the second question, I think we -- the services we offer and the products we have are well positioned to capture that potential growth. The trend is generally positive for us across all our segments since many of the things we offer are typically -- or they become relevant later in a dog's life, for example, like orthopedic issues or allergies are often detected somewhat -- sometime into the pet's life. Same goes with dental problems, which tend to increase as the dog gets older and so forth.

So from a general sentiment, the COVID dog effect, when it happens and if it happens, will have a positive effect on our business as well, given the products and services we offer.

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

Thank you all for listening in. I want to reiterate how I started. Vimian is off to a good start of the year with double-digit growth in 3 out of 4 segments. We have strong cash generation. And as you see, our M&A pipeline is becoming more fruitful. We're super happy onboarding the 3 acquisitions year-to-date. And we look forward to continue growing and developing business -- the Vimian business in [ phase ] animal health. Thank you very much.

Welcome to the Vimian Group Q4 Report 2025 Presentation. [Operator Instructions]

Now I will hand the conference over to the speakers, CEO, Alireza Tajbakhsh; and CFO, Carl-Johan Zetterberg Boudrie. Please go ahead.

Good morning, everyone, and welcome to Vimian's 2025 Year-end and Fourth Quarter Earnings Call. I'm Ali Tajbakhsh, the new Group CEO since end of last year after leading Veterinary Service segment for the past 4 years.

To give you some background, during my 4 years as Head of Veterinary Services, the business developed from a Northern European purchasing organization into a global service platform with over 10,000 member clinics. I personally experienced Vimian's ability to attract talent and entrepreneurs and take something relatively small with potential and build it into global scale market leader.

I'm a firm believer in our strategy of organic and acquisition-driven growth, and we operate in an exciting and resilient industry going through change. I know the sector, the customers, the business and our organization well, and I'm confident about our industry and Vimian's future.

We will now go through Vimian's full year and fourth quarter, and Carl-Johan will later give you deeper insights into the financials. Looking back at full year 2025, Vimian delivered revenue growth of 13% and adjusted EBITA growth of 11%. We saw broad-based growth across most of our businesses, not least in specialty pharma, veterinary services and our MedTech dental businesses. We also put in focused efforts to address the headwinds within MedTech orthopedics, in particular, in the U.S.

In fall, we received a positive judgment in the U.S. indemnification process and all our counterparts have now, as per year-end, paid us in full share. The year also delivered a strong operational cash flow of EUR 105.7 million, corresponding to a cash conversion of 101%. Last but not least, we also completed the list change to NASDAQ Main Market, where we are now a large cap company.

Going deeper into Q4 and looking at the quarter, we delivered a solid finish to 2025 with 6% organic growth and 6% adjusted EBITA growth. Excluding currency effects, adjusted EBITA grew by 12%. We saw continued momentum within our Specialty Pharma segment. We saw a strong finish with MedTech dental, while active measures were taken in the quarter within MedTech orthopedics.

Veterinary Services continued to perform at scale, reaching over 10,000 members. And in the quarter, we increased our M&A activity with 3 acquisitions across 3 different segments and expanded our M&A pipeline in the past few months ahead of 2026. I-Vet, an important milestone for our Diagnostics segment was signed just before Christmas and is an acquisition to strengthen the companion animal offering within that segment. The quarter also delivered strong cash conversion.

Looking at Q4, we had 4% revenue growth to EUR 109 million. Our organic revenue growth was 6%, driven by Specialty Pharma, Veterinary Services and our MedTech dental business. 3% contributions from acquisition, and we saw a 4% negative impact from currency movements, in particular, the movements within U.S. dollars. We improved our margin by 60 basis points versus Q4 2024, driven by bolt-on acquisitions and delivered 6% adjusted EBITA growth for the quarter. And as I said before, excluding currency effects, adjusted EBITA grew -- growth was 12%.

Looking at Specialty Pharma, we continue to see positive performance in the fourth quarter with 6% organic growth following an exceptionally strong Q4 '24, where we reported 22% organic growth. Normalizing the positive effects from the national sales campaign in the U.S. in the fourth quarter 2024, the underlying organic growth was double digit in the fourth quarter this year.

All 4 therapeutic areas delivered growth in the quarter with the strongest contribution from our dermatology portfolio. Overall, organic growth continues to be driven by our innovation, cross-sales activities and veterinary education.

Adjusted EBITA grew 4% or 7% adjusted for currency effects to EUR 13.8 million, which is an all-time high quarter for us. The margin improved from 29.4% to 30%, driven by revenue growth at stronger gross margin. For the full year, Specialty Pharma grew 6% to EUR 182.4 million and adjusted EBITA by 10% to EUR 53.9 million.

In January, our Head of Specialty Pharma, Magnus announced his departure after 10 years in the company. I believe the business stands strong and a recruitment process for a successor is ongoing, and we've secured a strong transition plan with Carl-Johan as Interim Head of Specialty Pharma.

As Interim Head of MedTech since end of July, I'm happy to see the accelerated momentum in our Dental business in the quarter as well as early operational improvements within our Orthopedic business, although we still have work to be done and the market remains soft. In total, we delivered 4% organic growth in the fourth quarter, supported by strong growth in our Dental business and Orthopedics in Europe and APAC.

Within Orthopedics, we have implemented a reorganization in the quarter with focus on strengthening commercial performance. We built out our field sales organization in the U.S., and we reviewed and rationalized our product portfolio where we had over 22,000 SKUs and have decided to discontinue over 4,000 overlapping SKUs. We are still in transition phase in U.S. orthopedics during the initial period of 2026. We continue to drive sequential sales improvements, but do not expect Orthopedics to deliver year-on-year growth until later in spring. The recruitment for a permanent Head of MedTech is ongoing and progressing well.

The margin in the quarter of 24.6% is a 370 basis point improvement versus Q4 '24, mainly driven by the consolidation of bolt-on acquisition within dentistry in '25. Adjusted EBITA grew 23% in the quarter and 32%, excluding currency effects. For the full year, MedTech grew revenues by 25% to EUR 155.5 million, where our acquisitions within dentistry contributed 30%. Full year adjusted EBITA grew 15% to EUR 39.6 million.

Veterinary Services delivered another strong quarter with 10% organic growth. In October, we completed the acquisition of a local service platform in Belgium with 300 member clinics and passed the 10,000 milestone when it comes to member clinics, closing the year with 10,900 member clinics. As previously communicated, we are accelerating our investments into new geographies and services in the quarter, taking the margin to 26.6%. For the full year, Veterinary Service increased revenues by 11% to EUR 64.3 million and adjusted EBITA grew 9% to EUR 18.4 million.

Michael Thunell, who has been part of Veterinary Services since 2018, was appointed Head of Veterinary Services when I became CEO, and I'm pleased to see how the team has come together and continue to build momentum as the global leading veterinary service platform.

Our Diagnostic business reported 5% organic growth in the quarter and a margin of 9.2%, reflecting our investments in new products and personnel to strengthen the companion animal offering. The growth was supported by Blue Tongue outbreaks in Europe and Avian influenza globally. For the full year, Diagnostics grew by 9% to EUR 22.9 million, while adjusted EBITA declined 3% to EUR 2.2 million.

As I said initially, we welcomed 5 new businesses in 2025 that expanded our portfolio and geographic footprint. We've seen improving M&A momentum towards the end of the year, with 3 out of these 5 acquisitions coming in the fourth quarter. We've built a stronger pipeline over the past months, and I'm optimistic about the M&A opportunities going into 2026.

We continue to focus on successful entrepreneurial-led businesses that can grow and reach their full potential faster as part of Vimian. A good example of that is I-Vet that we signed in December. I-Vet is one of the top 3 in companion animal diagnostics in Italy and forms an important addition to our Diagnostics segment. I-Vet is a typical Vimian acquisition, high-growth, successful and entrepreneurial-led business where the entrepreneur Daniele is highly motivated and will continue to lead the business as part of Vimian. Annual revenues of EUR 5.6 million, where 2/3 of the revenues comes from laboratory services, where they have 3 vet labs in Italy and the remaining 1/3 is from sales and in-clinic diagnostic tests. I-Vet also has a well-renowned educational platform with over 100 courses annually and offer residency program in partnership with universities.

Looking at our sustainability, as we now close 2025, we can see that we continue to make important progress within our ESG agenda. Our sustainability agenda is closely integrated into the core of the business and focuses on animal, our people and the planet. During 2025, we educated 65,000 veterinary professionals to improve animal health, and we launched 94 new products to advance veterinary medicine. Our employee Net Promoter Score reached 30, and we have exceptionally high scores from our teams in areas of inclusion, trust and autonomy.

On the environmental side, we continue to reduce our emissions in total with 25% since 2022. We also received external recognition for our work with an improved rating at both MSCI to AA and Sustainalytics to low risk.

With that run-through of the year and the quarter, I will now hand over to Carl-Johan.

Thank you, Ali. And let me give you some further insights to the financials for the fourth quarter and full year.

Adjusted EBITA in the fourth quarter was EUR 26.1 million, an increase of 6%. This represents a margin of 24.0% for the quarter. The margin increase is primarily an effect of consolidation of bolt-on acquisitions within MedTech dentistry during 2025. Also our largest segment, Specialty Pharma, contributed to the margin expansion supported by operational leverage in the business.

We reported an operating profit of EUR 19.2 million, a significant 54% increase from last year's result of EUR 12.5 million. Items affecting comparability decreased in the quarter and totaled minus EUR 0.7 million. The majority of items affecting comparability is relating to Medtech. This consists of minus EUR 1.6 million in restructuring costs from organizational changes and inventory write-down as a consequence of the product portfolio rationalization, as well as EUR 2.7 million relating to payments net of litigation costs in the U.S. indemnification dispute. Acquisition-related costs amounted to EUR 1.1 million in total for the group.

Net financial items amounted to minus EUR 7.5 million and consists of 4 main parts: financing expenses of minus EUR 4.1 million with an average interest rate of 4.5% during the quarter. A quarterly discounting impact of minus EUR 1.6 million and a negative impact of minus EUR 3.1 million from probability adjustments related to contingent considerations. The probability adjustments primarily relates to stronger performance in our acquired dental businesses. A negative result of EUR 0.7 million from liquidation and divestments of subsidiaries and lastly, a positive impact of EUR 2.2 million from exchange rate effects on the revaluation of debt.

Income tax expense for the quarter was EUR 0.8 million, with an effective positive tax rate of 7%. In the fourth quarter, the tax expense as a percentage of pretax profit was positively affected by recognition of deferred tax -- on tax losses carried forward at year-end, amounting to EUR 3.7 million. The effective tax rate was inflated by nondeductible expenses, mainly probability adjustments of contingent liabilities. In total, this results in a profit for the period of EUR 12.2 million with an earnings per share of EUR 0.02 for the quarter.

Cash flow from operating activities reached EUR 55.7 million, including payment from U.S. indemnification dispute of EUR 28.7 million in the quarter. Excluding the litigation payment, cash conversion was 92% for the fourth quarter. Net working capital amounted to EUR 96.6 million at the end of the quarter, equal to 23% of revenue, a decrease from EUR 102.2 million at the end of the third quarter, which equaled 24% of revenue. The majority of the EUR 5.6 million decrease in working capital relates to lower current receivables and increase in trade payables.

Cash flow from investing activities amounted to minus EUR 17.5 million, primarily relating to acquisitions, earn-out payments and investments in tangible and intangible assets. Cash flow from financing activities of minus EUR 35.5 million from repayment of borrowings.

At the end of the quarter, net debt amounted to EUR 245.4 million, which is down from EUR 253.5 million at the end of the third quarter. Cash and cash equivalents amounted to EUR 55.0 million, an increase compared to EUR 51.3 million at the end of September. External lending was EUR 223.3 million at the end of the fourth quarter. This resulted in a leverage at the end of the quarter equal to 2.0x, which is down from 2.1 at the end of the third quarter. And we remain well capitalized with an ability to execute on our strengthened acquisition pipeline.

With this financial review, I hand the word back to Ali for concluding remarks.

Thank you, Carl-Johan. We delivered a solid finish to 2025, and we are well positioned in a resilient market that continues to grow. I'm a firm believer in our strategy of combining organic and acquisition-driven growth, and my focus is to accelerate what is working well and address the areas we need to improve.

We have an attractive platform for entrepreneurs, and I'm optimistic about our M&A pipeline going into 2026. I hear frequently from industry peers and partners that the entrepreneurial spirit and the quality of our people consistently stands out. This is something we take pride in, and we will continue to build upon. With our focus on global market niches with unmet medical needs and high growth potential with a strong team in place and with the products and services we offer, I'm confident we can deliver a good 2026. Thank you.

[Operator Instructions] The next question comes from Kavya Deshpande from UBS.

I have a couple, please. So the first was on organic growth from here after the very good exit you've had in Q4. I understand you don't give annual guidance, but could you give us a sense of how significant an organic acceleration we can expect in 2026? I ask because you have a long-term guidance for double-digit organic growth to 2030, you're at 7% for the first 2 years of the plan. Consensus has you at high single digits for '26. So that obviously implies quite a ramp towards the end of the decade. Are you comfortable with this cadence? Or do you think we can start to get closer to that double-digit organic growth target sooner?

Thank you for the question. I think we see an overall -- and the overall animal health market continues to grow, and we have positive business momentum, as I said, in most parts of Vimian. So I think we should be able to deliver good growth in 2026.

And my second question is just on Spec Pharma and the cross-selling initiatives there. If I have it right, it slowed a fair bit sequentially in terms of the contribution to the divisional organic growth in Q4 of Q3 and also of Q2. Are you just reaching sort of the end of this program? And if not, then how much of a contribution can we expect to come from cross-selling for Spec Pharma and group organic growth in 2026, please?

Yes. Thank you. Cross-selling has been and continues to be a robust contributor to organic growth. We saw in '25, just as we saw in '24, that 1/3 of the organic growth was driven and supported by our cross-selling initiatives. And we are launching, and we launch new cross-selling initiatives going forward. In 2026, 8 new cross-selling initiatives will be launched, while we see continuous runway for a solid contribution from cross-sales in 2026 and beyond.

Apologies. Just to clarify, so is it 1/3 of organic growth in the quarter because the press release says in 2025, and I think the previous ones give it as year-to-date. Just to confirm that would be great.

The 1/3 is the year-to-date number. So for 2025, 1/3 of the organic growth was supported by cross-sales.

The next question comes from Adela Dashian from Jefferies.

Ali, congratulations on the new appointment. A couple of questions from me as well. Firstly, if we start with MedTech, I believe you said here that you don't expect an acceleration or year-over-year growth until spring. Should we read that as some sort of guidance that you do expect MedTech to return to double-digit organic growth by Q2?

We see early operational improvements, but we are undergoing significant change with the new sales team fully in place as of January. So I think Q1 or spring will be a transition phase for us, but we continue to drive sequential sales improvements, but we don't expect it, as you said, to deliver year-on-year growth until later this spring. I think that's all we can say at this stage. But I think or I can add to a full recovery will probably require the market to regain momentum as well.

And by a full recovery, you mean double digits?

Yes, the market remains soft right now. So I think the combination of our efforts into the operational side of the business and the market returning to better growth is needed to get to double digits.

I see. And then you mentioned also a number of SKUs being discontinued. Could you just -- have those already been discontinued? Or is this an effort that will take place now in 2026 as part of the new commercial efforts?

We've already initiated the work of discontinuing those SKUs, but there are a few that will be transitioned and discontinued now early this year as well.

Would it be possible to quantify what the impact of that was on sales in 2025?

Limited. This is overlapping SKUs. So the SKUs we are discontinuing, we have equivalent products that are better and more relevant for our customers to buy.

Okay. Great. And then lastly, on veterinary services, still a high pace of investments. What's the, I guess, phasing of that? Do you expect a continuation even in 2026 or a slowdown at some stage?

We see continued momentum in Veterinary Services. It's been one of our segments performing very well for a long period of time, and we see that to continue. The investments we're doing is to ensure that we capture the full potential and the inbound need we get from our partners and veterinarians across the world.

The next question comes from Sten Gustafsson from ABG Sundal Collier.

I was wondering if you could give us a little bit of color on the M&A market right now in terms of number of opportunities, price levels on targets? And also where you focus your efforts on? Where do you want to grow? What areas specifically are you looking to go after?

We see an increased M&A momentum. As we stated, 3 out of the 5 acquisitions we made in 2025 happened in Q4. We're also confident about the building of our pipeline going into 2026, where we see Vimian being a good and interesting platform for entrepreneurs in animal health to join. With the acquisition of I-Vet in Diagnostics, I think we now have 4 active verticals looking at interesting bolt-on or platform acquisitions.

And in terms of price points, has there been any change, would you say, like compared to a year ago?

No, I wouldn't say that we see a change. We have a historical average of approximately 9x EBITDA, and we are around that average. As previously communicated, typically, platform acquisitions such as iM3 within the dental space come with a slightly higher multiple, whereas add-on acquisitions to that comes with a lower multiple, but the average is 9x.

Okay. Perfect. And then a quick question on the U.S. MedTech market. What do you hear from your customers? What kind of feedback? And what do they tell you in terms of the market sentiment and activity levels?

I think the feedback from our customers are similar going into 2026 than during '25 from a market sentiment perspective. But with our approach of now building a field sales team in the U.S., this allows us to come even closer to our customers and together with them, support them in growing the business into the future.

But sort of what are they waiting for in terms of -- for the market to return? Is that sort of higher consumer confidence? Or what's the sort of inflection point that will drive the market back to normal levels?

A simplified question on that is, of course, macroeconomics in general. There is still -- I mean, this is Advanced Care. But I think with the macro return, we will see impacts on the business as well.

The next question comes from Arvid Necander from DNB Carnegie.

So first off, on Spec Pharma, do you expect this segment to be able to return to double-digit organic growth in 2026? And if so, it would be great to sort of get your view on what would be the main drivers for this surge in growth? And then secondly, on MedTech, comparisons have become a bit easier, of course. But if we look at the industry data, it seems to have stabilized somewhat since midyear. Do you view this as a genuine inflection point? And how would you characterize the overall market sentiment right now?

Arvid, I'll start with your question on Specialty Pharma. So we have a good momentum in Specialty Pharma. If we look through the full year and if we look at the fourth quarter of 2025, all of our 4 therapeutical areas grew and had a good momentum. In the end of the year in the fourth quarter, we delivered 12% organic growth if we exclude or normalize for the national sales campaign that we did in Q4 of 2024 that we did in Q3 of 2025. So we see a continued positive momentum in Specialty Pharma, and we see that as a double-digit growth business in terms of what will take us sort of to continue to deliver on a good growth momentum.

We have a two-pronged strategy in terms of organic growth and inorganic growth. From the organic growth perspective, we are focusing, as we discussed before, on cross-sales, on innovation and on education. And we see that all those 3, let's say, organic initiatives will drive and contribute to continued good momentum in organic growth in Specialty Pharma.

Okay. Just a quick follow-up on that one. How would you characterize the pipeline for 2026 versus 2025, if you would sort of size the growth opportunities?

I would -- we have a continued good momentum in the business, and we see continued opportunities to expand in existing areas and to find new growth in new areas.

Okay. Fair enough.

And then to your MedTech market question, I think going into 2026, we see the U.S. surgery market condition remaining relatively unchanged. There are signs of stabilization, but I don't think it's returned to healthy growth yet. With that said, I mean, we are confident in our strong product portfolio and the brands we offer and combining that with the actions I mentioned we're taking, over time, I think we will get back to good growth and also beat the market. But given that we have a new sales team fully in place as of January, we believe that Q1 and spring is still a transition phase, but we see sequential sales improvements quarter-by-quarter.

The next question comes from Adrian Elmlund from Nordea.

I have a few questions, please. So first off, could you provide perhaps some more details here into the field sales organization build-out in the MedTech business in the U.S.? And kind of also, we've had a previous question regarding the portfolio streamlining. But kind of could you give some more color, I guess, on what you expect this will impact the business over the coming year? Could there be some positive mix effect?

I think with the field sales in place as of January, we're convinced that that's the right strategy going forward, being close to our customers and together through our educational platforms and efforts we do drive growth. Given that it's a new sales team in place and the investment we're doing into that, we believe that, as I said before, the spring -- and Q1 and the spring will be slightly soft. But over time, with driving sales up on the back of having a strong and present field sales with our customers, that will also drive margin up. With that said, we expect the margin to be fairly flat beginning of the year.

And there's no specific mix effect with reducing the SKUs there? In terms of gross margins or EBIT margins?

Nothing substantial.

Okay. Another question regarding mix effects. You had some negative ones in the Vet family business. What should we expect going forward? And kind of what were the results there?

I think the Vet family margin, as we guided throughout last year as well on the back of these investments has gone down, although there are some mix effects as well, but we believe the margin will improve throughout the year on the back of these investments starting to show signs of effect.

Right. Okay. And regarding here the recruitment of a potential successor here for Kjellberg of Nextmune, kind of what profile are you prioritizing here? And could his departure perhaps prompt any shift in strategy in any way, shape or form?

No, I think Magnus has been a very appreciated colleague and has built specialty Pharma throughout the last 10 years. We believe that with him departing, we will look for a strong operator, somebody that can help us take the business and continue the successes we've had and take the next step. There's so much more things we believe Specialty Pharma can do and continue to grow. At the same time, the leadership bench within Specialty Pharma and also Vimian is very strong. So I believe the business is run by our strong operators in the market. So I'm confident that what we've built up until now will continue to drive similar success in the future.

Okay. Last question here. I don't know if I missed this, but what was the main reason here behind the large change in the operating receivables in the quarter? Is this purely the patent litigation? Or did I miss something?

To a large extent, that's driven by the patent litigation as we received EUR 28.7 million in the quarter.

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

No, thank you very much for listening in on our Q4 call. As I started off with, we are extremely ready for 2026. We delivered a solid finish to 2025, and we look forward to continue growing the business together with all the fantastic employees we have within. Thank you very much.

Welcome to the Vimian Group Q3 Report 2025 Presentation. [Operator Instructions]

Now I will hand the conference over to the speakers, CFO and Interim CEO, Carl-Johan Zetterberg Boudrie; and Magnus Kjellberg, Vimian Specialty Pharma. Please go ahead.

Good morning, everyone, and welcome to Vimian's Third Quarter Earnings Call. I'm Carl-Johan Zetterberg Boudrie, CFO and Interim CEO. And with me today is Magnus Kjellberg, who's leading Specialty Pharma, our largest segment, representing almost 50% of Vimian. We'll go through the quarterly results, and Magnus will give you some additional insights to our Specialty Pharma segment.

We delivered strong revenue growth of 19%, with 9% organic growth in the third quarter. We also saw strong earnings growth with adjusted EBITDA up 17% in the quarter. Both Specialty Pharma and Veterinary Services continued to deliver strong performance, and our MedTech segment returned to organic growth in the quarter after a tougher second quarter this year.

In August, we received the positive news in the U.S. indemnification dispute. The court awarded us $40.2 million in damages, which means that we're entitled to compensation exceeding the amount we paid in the settlement with DePuy Synthes in 2023. Our M&A pipeline continues to build, and we are working hard to progress key targets in the pipeline.

Turning to the numbers. And looking at the past years, Vimian has a strong track record of growth and profitability with 16% compounded annual revenue growth and 14% adjusted EBITDA CAGR between 2022 and the third quarter of 2025. For the third quarter isolated, we reported 19% total revenue growth, reaching EUR 104.3 million. Organic growth in the quarter was 9%, driven by strong performance in Specialty Pharma and Veterinary Services. And it was also satisfying to see MedTech returning to organic growth of 5% in the quarter. In total, we had 40% contribution from acquisitions and 4% negative impact from currency movements in the quarter, predominantly from the U.S. to euro movements.

We delivered strong adjusted EBITDA growth of 17% in the quarter to EUR 25.5 million. Margin was 24.5% compared to 25.0% in the same period last year, negatively impacted by our investments in the commercial organization in MedTech Orthopedics and the consolidation of the Dental business, iM3, that has a different financial profile.

With a headline overview, I will hand over to Magnus for an update on Specialty Pharma, Followed by a walk-through of the other segments and financials.

Thank you, Carl-Johan. For Specialty Pharma, we are satisfied to deliver another quarter of all-time high revenues for the individual quarter. We delivered double-digit organic growth of 11% with growth across all 4 therapeutic areas. The strongest contribution this quarter came from Specialty Pharmaceuticals and Specialised Nutrition. In Specialty Pharmaceuticals, new products, new contracts with corporate clients and internationalization were key growth drivers. In Specialised Nutrition, we've got the opportunities to do another national campaign across the U.S. with one of the leading retailers that supported growth in the quarter. Adjusted EBITDA grew organically with 14%, and we had 150 basis points margin improvement driven by the strong revenue growth and good drop-through to bottom line.

Turning to next page. I will put Q3 performance into a strategic context. We have a 2-pronged strategy, organic and M&A-driven growth. Our organic growth strategy revolves around 3 pillars: cross-selling, innovation and education.

Cross-selling, we currently have 16 cross-selling initiatives ongoing, representing 18% of sales. A key initiative has been to nationalize our portfolio by going direct with our own sales force as opposed to a distributor. Our acquisition of ICF in 2020 is a case in point. ICF, great topical product range, great brands, great presence in Italy, proprietary production, very synergistic with our AMVI range, but largely an Italian phenomenon, relying upon third-party distributors outside of Italy. We have internationalized business by terminating the distribution contracts for the veterinary channel in France, the Netherlands and Belgium. We now go direct with our own sales force in these markets. We have also expanded our channel presence. We have launched a range online in the U.K., Scandinavia, Germany and France. All in all, we have grown the international business of ICF during our ownership by 18% CAGR. In Q3, our internationalization and channel expansion initiatives of the ICF range continued with good momentum. 60% of cross-selling growth came from these ICF initiatives.

Innovation, we launched 21 products in Q3 and currently have 70 products in pipeline. Innovations in antimicrobial otology continue to be important. Our antimicrobial otology range, typically substitutes antibiotics. Also, it is very synergistic to our AMVI range, 50% of all allergic dogs gets otitis as a secondary infection. In Q3, we launched a follow-up to our bestseller Otodine, called Peptivet4. It reduces bacterial growth in the ear canal, it includes 2 novel peptides, which we have patented. Also, the composition ensures a slow release function, so it lasts between applications.

Education, we attended 30 congresses in Q3. A key highlight was the British Equine Veterinary Association Congress in Birmingham, where we were a gold sponsor. We were also gold sponsor at the European Society of Veterinary Dermatology Congress in Bilbao. Peptivet4 was an important launch at the Congress, and we continue to promote the advantages of our molecular All testing platform, Pet All Xplorer, PAX, at the Congress.

M&A, the prospects for M&A are strong. Our industry remains highly fragmented. We're taking our business from EUR 4 million of sales at inception 10 years ago to more than EUR 180 million today, a growth of 45x. And M&A has been an important tool for the trajectory. And M&A will continue to be an important tool going forward. Year-to-date, we have screened more than 235 targets in existing and new therapeutic areas, a testament to the fragmentation of the industry. More M&A will also unlock more cross-selling opportunities.

Turning to the next page, I will provide more color on cross-selling. 39% of year-to-date organic growth comes from cross-selling. Increased direct market presence and internationalization has been the main contributor, 49%, channel expansion, 35%, and the remainder has come from substituting third-party products with our own products.

Our cross-selling strategy going forward rest on 3 pillars: grow existing cross-selling initiatives; launch new cross-selling initiatives, we have 8 to be launched in 2026; and create new cross-selling initiatives from M&A.

I will now hand back to you, Carl-Johan.

Thank you very much, Magnus. Let me give you some insights to the other 3 segments of Vimian, starting with MedTech, where MedTech delivered 46% total revenue growth and 5% organic growth, driven by mid- to high single-digit growth in orthopedics in Europe and Asia Pacific, combined with a flat development in North America, which is a recovery from the second quarter this year.

Although I'm pleased with the recovery in U.S. orthopedics during the quarter, the surgery market is likely to remain soft over the coming period, and we continue to deploy our actions to further strengthen our commercial performance and outperform the market. Even if it will take some time before we see the full financial benefits of these measures, I'm confident that we operationally are taking the right actions and now have a strengthened team in place.

Long term, this is a very attractive market with millions of untreated animals and opportunities to educate more veterinarians to unlock growth.

Our dental operations with iM3 and the 2 bolt-on acquisitions completed earlier this year continued to deliver solid growth in the quarter. And in the beginning of October, we completed a small acquisition of an AI-enabled imaging software that further complements and strengthens our dental portfolio.

Adjusted EBITDA grew 26% in the quarter and the year-over-year margin in MedTech was impacted by our investments in the commercial organization in U.S. orthopedics to drive growth and the consolidation of iM3 from the 1st of October last year.

All in all, the third quarter marked an important step in the right direction for our U.S. orthopedics business and our dental operations continues to show good performance.

Veterinary Services continued to perform well, with 11% organic growth, driven by new member growth and increased penetration of services across the member base. The total number of member clinics reached 9,940 at the end of the quarter. The margin showed a sequential improvement but year-over-year decline as we now start to initiate planned investments in new geographies and services, which we'll see more of in the coming quarters. Adjusted EBITDA for the third quarter grew by 4%. Overall, we're satisfied with the continued good momentum in Veterinary Services.

Diagnostics delivered 4% organic growth despite lower level of disease outbreaks compared to the same period last year. Year-to-date, the segment delivered 13% organic growth. The margin reflects our investments in new products to diversify into the companion animal market, and we also explore M&A opportunities to strengthen our offering within the companion animal diagnostics space.

Before I will go deeper into the quarterly financials, I want to give you a brief summary of M&A activities and the important part that has played in us executing our strategy and continue to build Vimian as a leading player in the global animal health industry.

M&A continues to form an integral part of our strategy, and we're now accelerating our efforts to advance and progress our pipeline, covering both existing platforms and new market niches. The past 5 years, we have completed 44 acquisitions, adding approximately EUR 170 million in revenue across all 4 segments, and spread across the key regions, North America, Europe and Asia Pacific.

In the past 12 months, we have completed 4 acquisitions in Veterinary Dental, adding EUR 47 million in revenues. Veterinary Dentistry is a new market niche for us and one of the fastest-growing categories in the veterinary clinics today, 80% of grown-up dogs and cats suffer from periodontal disease, and we see significant white space here. Looking ahead, we'll continue to build on this platform, and we have established a strong network among entrepreneurs in the dental space.

We also continue to execute on our sustainability agenda focused on animals, our people and the planet. During the third quarter, our efforts in this area was recognized when we achieved improved ESG ratings with Sustainalytics to low risk. And earlier this year, MSCI upgraded our rating to AA.

With that business review, let me give you a walk through on the financials for the third quarter. Adjusted EBITDA in the third quarter was EUR 25.5 million, an increase of 17%. This represents a margin of 24.5%. The lower margin compared to the same period last year is driven by our investments in the commercial organization in U.S. Orthopedics to drive growth and the consolidation of iM3 from October 1 last year with a lower margin profile. We report an operating profit of EUR 17.5 million, a significant 74% increase from last year's result of EUR 10.1 million. Items affecting comparability decreased in the quarter and totaled EUR 1.7 million, with the largest contribution from MedTech relating to M&A.

The net financial items of minus EUR 4.1 million consists of 3 main components: finance expense of minus EUR 4 million with an average interest rate of 4.6%; the quarterly discounting impact of minus EUR 0.8 million; and impact of EUR 1.3 million from probability adjustments on contingent considerations; and lastly, a negative impact of EUR 1 million from exchange rate effects on revaluation of debt.

The income tax expense for the quarter amounted to minus EUR 6.6 million, inflated by additional taxes paid for reassessment of prior year taxes in one of our entities. We are currently reviewing tax management in the group to over time reduce our effective tax rate. In total, this results in a profit for the period of EUR 6.8 million with earnings per share of EUR 0.01 for the quarter.

Cash flow from operating activities reached EUR 10.8 million in the third quarter, impacted by the higher tax expenses in the quarter and a negative impact from currency effects. Net working capital amounted to EUR 102.2 million at the end of the quarter, which is equal to 24% of revenue. The EUR 102.2 million is an increase from EUR 99.5 million at the end of June, which represented 25% of revenue. So in relation to sales, net working capital decreased slightly in the quarter. The majority of the increased working capital is mainly related to lower trade payables.

Cash flow from investing activities of minus EUR 5.1 million is driven by investments in intangible assets and equipment, and the cash flow from financing activities of minus EUR 22 million is relating to repayment of borrowings. After the end of the quarter, we received the first payment of approximately $15 million following the court decision in the U.S. indemnification dispute.

At the end of the period, net debt amounted to EUR 253.5 million, which is down from EUR 260.6 million at the end of the second quarter. Leverage in the quarter equaled 2.1x, and we remain well capitalized for future M&A opportunities.

On a concluding remark perspective, this will conclude the review for the third quarter, where we delivered strong revenue growth of 19% and 9% organic growth. We also delivered strong earnings growth with 17% adjusted EBITDA growth. Specialty Pharma and Veterinary Services continued to deliver strong performance, combined with the recovery in MedTech orthopedics.

Looking ahead, we will continue to implement our actions to strengthen commercial performance in U.S. Orthopedics and we're also accelerating our efforts to expand and progress our M&A pipeline, looking at both existing and new market niches. We see our markets continuing to grow with increasing pet ownership, humanization of pets and an aging pet population. And I appreciate that we remain well positioned in the current geopolitical landscape with a well-diversified operations.

With these concluding remarks, I would like to open up for the Q&A session.

[Operator Instructions] The next question comes from Arvid Necander from Carnegie.

So first off, could you just comment on the CEO recruitment process? What's the current status? And where do you expect to be -- when do you expect to be able to announce a name?

And secondly, for Spec Pharma, can you break down the organic growth by subsegment with allergy, dermatology and specialized nutrition? And perhaps comment a little bit on the momentum and your expectations going into Q4 considering all these recent launches, but also the campaign you ran last year. I'll start there.

Thank you very much, Arvid. I'll start to comment on the CEO recruitment, and then I'll let the specialist, Magnus, to cover Specialty Pharma.

As you know, there is an external search ongoing, and that is proceeding according to plan. I'm confident that we'll be able to announce a very strong CEO for Vimian, and we expect that to happen within not the too distant future.

Organic growth in Specialty Pharma. So we had organic growth in all 4 therapeutic areas in the quarter with particularly strong growth in Specialty Pharmaceuticals and Specialised Nutrition. We're very pleased with our business with Costco, which is a great client of ours. It's a repeat business for us, and we have increased wallet share with that client, and we expect to do more business with Costco also going forward. Specialty Pharmaceuticals, the personalized medicine business is a business with strong trajectory. They've grown the business strongly Q1, Q2, Q3.

So consistently, I think we're up 15% year-to-date in Specialty Pharmaceuticals and we have strong margins in that business, 85% gross margins, 35% to 40% EBITDA margin. So very pleased with that performance. And there were a few orders in dermatology that didn't come across that we hope to come across in this quarter, but we believe that, that will come in the coming quarters.

Great. Maybe just a quick follow-up on that. Does the current momentum in your view support this being a double-digit growth business going into 2026 as well?

Well, we definitely view Specialty Pharma as a double-digit organic growth business. We have grown this business since IPO per quarter on average by 12%. And year-to-date, we're up 9%. So, yes -- no, we view ourselves as a double-digit growth business for sure, yes.

The next question comes from Adrian Elmlund from Nordea.

A couple of questions from me here. So firstly, regarding the cash flow, which is obviously down year-over-year, could you just give us some more details behind what you expect to do to increase the cash conversions going ahead?

Of course. So let's start with that question. I think if we look a few quarters back, and I think as many of you remember, operating cash flow and cash conversion has been a topic that we focused on, an important aspect for us to improve. And we have seen a clear improvement if we look in the latest quarters in terms of operating cash flow and cash conversion.

In this quarter specifically, our operating cash flow and as a consequence, the cash conversion is burdened by the reassessment of taxes and additional taxes paid as we mentioned in one specific entity. And secondly, we have negative impact from FX. So we've had certain, you can say, one-offs that impacted us negatively, but we'll continue to focus on the cash conversion and our operating cash flow that is an important topic for us to drive and to be very good at as well.

Okay. Fair enough. Kind of a follow-up, I guess. You're also starting to discuss the M&A again, a bit more now as of recent. And then referring back to 2021, when you have very high leverage. Are you willing to close to your historical leverage ratios? Or do you think that you will have systematically lower leverage going ahead, even though when you're sort of reactivating the M&A again there?

As you say, I mean, we have a two-pronged strategy where M&A is 1 of the 2 pillars, a very important vehicle for us to achieve our strategy and to become a leader in the global animal health space. And it's correct that, yes, we are accelerating our efforts in M&A because of the importance to our strategy. We do have a long-term financial target saying that we will reach EUR 300 million by 2030, and that we will not go above 3.0x in leverage.

Having that said, of course, we are working hard to accelerate our M&A agenda. We have sort of a strong financial -- strong financials. We're able to execute on M&A, which means that we will execute on the M&A opportunities that we think are the right ones when they are able to be executed. But again, I refer back to our long-term financial targets in terms of we do have a target besides the EUR 300 million in adjusted EBITDA that we're going to keep sort of a sound financial profile of our balance sheet.

Okay. Last question here, if I may. Did you have any remarks on the sort of recent news regarding the U.K.'s watchdog basically requiring vets to make prices more public and et cetera? Do you think this affects you in any material matter? And do you expect this to affect the overall market in the U.K?

No, it does not affect us in a material matter. The scope of the CMA review are the 6 key corporates in the U.K. We are a supplier to these corporates, but we're not in scope of the review. We are supporting price transparency and ownership transparency. We think that's a positive for pet parents. But again, the scope and focus of the review are the 6 key corporates, not the suppliers and Vimian is a supplier to these clients.

And just very quickly and the market in general, do you think that will change in any way?

The dynamics of the market for Vimian will not change in any material way. I think that we do very good business with these corporates, we do very good business with the independents, 60%, 65% of our clinics in U.K. are part of the corporate. So very important client base. But for us, it is not a material matter.

The next question comes from Adela Dashian from Jefferies.

One follow-up on the development that you've seen in MedTech. And I'm sorry if I missed it earlier, but I guess, the organic growth is positive. It's a positive development, positive surprise. Would you say that this is more categorized by an inflection point in the end market or as a result of the commercial activities that you've onboarded?

Overall, MedTech, the organic growth was 5%. And of course, we're pleased to see that we see a start of a recovery in the MedTech segment. Maybe important to note, as we stated in the earnings presentation that the growth -- organic growth was driven by mid- to high single-digit growth in Europe and Asia Pacific. And in North America, we saw more flat development, but a clear improvement from what we saw in the second quarter of this year.

In terms of the end market, and there are data that should suggest that the market is starting to stabilize, which probably resonates with our view of the market, but we don't foresee any clear improvement in, you could say, the market sentiment in the near-term periods. But we are, of course, deploying a number of measures to ensure that we'll continue to drive growth and grow above the market.

Got it. And then when it comes to your cost base, it has been somewhat elevated this year as a result of the investments that you're making in several different segments. How do you view this going to 2026? I mean do you still think that you will need to push through with the commercial activities in MedTech and then also in Diagnostics and Veterinary Services, you've been focusing on expansionary efforts? So what's your view on that?

So we're making sure that we have a good balance in terms of investing in the business to drive sort of future growth and further growth and to strengthen our position in the market with, as I said, sort of a combination of a like-for-like margin improvement going forward. So we'll continue to invest in the business to make sure that we develop our business in a very strong way, both sort of short to long term, but with a focus on delivering like-for-like margin improvements.

The next question comes from Mattias Häggblom from Handelsbanken.

Yes. I had one basically related to the final one, but perhaps a bit more specific to the U.S. MedTech. So the return to growth in U.S. MedTech will be driven by operational changes, including a build-out of the field sales organization. So how should I think about the profit contribution from U.S. MedTech until volumes improve as most of these initiatives are associated with OpEx expansion first before perhaps volumes return?

No, as you said, I think our view and our focus is to ensure that we drive sort of continued sequential improvement in MedTech Orthopedics and in U.S. MedTech Orthopedics specifically. I think to your point and as we stated earlier, we don't foresee any clear market improvement near term why -- so we will drive growth, both by winning new customers but also expanding share of wallet with existing customers. So we will continue to make sure that we invest in the organization to improve our commercial efforts, but also from a long-term perspective because we do believe long term, this is a super interesting niche of the animal health market with a lot of unmet medical needs and sustainable -- or sorry, clear opportunities to educate more veterinary surgeons. We continue to drive that.

On your question specifically on margins. Yes, of course, we're investing to build the business long term while we need to see growth sort of returning for us to also see margins starting to improve gradually.

[Operator Instructions] The next question comes from Kavya Deshpande from UBS.

I just have one on Specialty Pharma, please. I was wondering if you could give us more color on the margin expansion in that business? Just because we traditionally think of nutrition is the lowest margin business and perhaps it was overrepresented in the mix this quarter because of the sales campaign. And when we look at the last time, you did the sales campaign in Q4, you saw sort of margin contraction even accounting for a few one-offs. So basically, has the underlying nutrition margin sort of improved from an operational perspective?

So the business that we won in the quarter, which is a repeat business, as you referred to from Q4 last year is on par with the margin overall for our U.S. Specialised Nutrition business. In terms of the 150 bps of more improvement that we see in the quarter, we have expanded margins in the Specialty Pharmaceuticals segment and in the Allergy and Dermatology segment, and that has weighed up the business that we won in the quarter.

So basically, what we're doing is that thanks to the strong revenue growth that we have across the 4 therapeutic areas, we have healthy gross margins across 4, and a good portion of the growth that we generate, the additional gross profit also travels down to the EBITDA line and drives margin expansion.

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 participating today and listening to our earnings call for the third quarter. We're pleased with a good third quarter. We delivered strong revenue growth and good organic growth of 9%. We also delivered strong earnings growth of 17%, especially a very continued solid momentum in Specialty Pharma and Veterinary Services. Looking ahead, we'll continue the accelerated implementation and execution of our strategy where we will drive strong organic growth combined with strong M&A-driven growth.

So with that concluding remarks, thank you very much for today, and have a lovely day.