New Wave Group Stock

Very, very welcome to the presentation of Q2 and the first half year. I'm pretty happy with Q2 actually, where we show a growth in both sales and earnings. And it also feels a little bit for the first time in many years actually that the market starts to be a bit more positive. It's only one point I'm not happy with in this report, and that is the organic growth, where I was hoping for more than 4%, 5%.

And I think we pretty soon will be there. We should also remember that we have several things that is happening this fall. For example, Dallas will start selling from all distribution from 1st of October. I think the costs on Dallas it's around SEK 10 million for the first 6 months, and it will continue to cost money in the coming quarter. And then hopefully -- and what I believe is that -- and that is one of our biggest investments in many, many years. It will start contributing sales-wise, of course, from October. And profit-wise, I think it will be 3 to 6 months, and we will be up running at least breakeven there.

So it's a lot of interesting things in front of us. Today, 2,877 employees, 28 countries and 3 different segments, as you know. And maybe there, I should say also that Sweden is now down to 20% of the sales, and it will continue to decrease due to the investments we are doing and the acquisition of Cotton Classics that are not there yet. Yes, here's not much to comment. We had -- and I think based on the questions we had earlier today, we have maybe a small misunderstanding regarding the tariffs because back to the result, it's only the tariffs on sold goods. The rest is deduction of the stock value that will strengthen the margins coming quarters instead.

And if you look at the figures for half the year, it's not any big effect of it. The result in Q1 should have been better than it was and the result in Q2 is slightly lower. So you know that. And one big investment we also have done that we have not talked so much about is Toppoint, our company that producing pens, water bottles and so on, that moved into a new fantastic facility in -- which was opened up in May. Also a pretty big investment. I don't have the numbers in my head, but -- so it's another SEK 250 million in investment there.

The quarter net sales, plus 14.6%, 12.3% are coming from Cotton Classics and the integration there is going pretty well. That includes also what they sell our own brands today that are also increasing all the time and 2.2% from organic growth. And again, that there, I'm not really happy. We should be higher on the organic growth, especially due to all the investments we have done and all the products we have launched last year and so on. If we look at the different countries, you can say it's -- I'm actually happy with all countries right now, excluding U.K. That has been very, very tough, and it continues to be very, very tough. And we also know that our competitors there have decreased their volumes, actually, most of them more than we, but it's not a good development there.

Operating profit, SEK 295 million. And there, I must say, due to all these investments we are doing with Dallas, with Toppoint and so on, I'm very, very happy. And the underlying profitability is very, very good, I would say. And we should also remember here that the second quarter and the first half of the year, we didn't have Cotton Classics last year. So when we compare, we have taken in acquisitions on roughly SEK 1 billion in a yearly turnover with an operating margin on 6%, 7% approximately. So if we look at, so to say, the old group, excluding investment, I think those results are very, very good and could have been much, much worse actually.

And what's holding it up is also, of course, a very strong gross margin. And I think I've said that for a few years now and it has been tough times that we will keep our gross margin. We will not use the price to deduct margin to increase sales. And that's, of course, sometimes it can be tempting to do that to blow up the growth. But I also know based on those 30 years that it's very, very difficult to raise again if you once have start the cutting.

April to June, yes, [ 13.5% ], say, SEK 2.6 billion. And currency was negative with only 1%. When it was it worst, we discussed that before. For example, in January of this year, U.S. was contributing minus 19% in currency. Then it's a bit hard to show growth actually. Promo, 17.5%. And the reason -- the main reason of that, that they are going very strong is of course, the Cotton Classics acquisition that are in that channel. Also retail sales up 5%, which I think is pretty good. I'm a little bit afraid actually on the backlash in South Europe in the third quarter due to that has been very, very warm.

I don't have any figures to base that one. But when I talk with the retailers there, it has been quite empty in the shops when it has been those really warm conditions. Cutter & Buck continued to grow well, and I think that, that growth will really increase. We also launched Tenson in U.S. through Cutter & Buck right now. And when Dallas open up, it gives us a very, very good chance to serve that part of U.S. As an example, you can say, if I take a simple example, all the sales before Thanksgiving, for example, that we have on the net, we have to quit 3 days earlier or cut order taking 3 days earlier in South U.S. today than we do in North U.S. because we can't deliver before.

So that will mean a lot, and I think they will actually continue to increase, and they have a very good growth. And in retail, it was in this quarter, mainly Craft, but also Clique. We were a bit lucky there. We were not involved in any way, you can say, with -- in the world championships of football. We have no -- unfortunately yet no national teams playing in Craft either. But what we did and what really shows the strength again about stock is that Sweden was qualifying so late. So the chains couldn't preorder or they didn't dare to preorder since in time. And we could supply from stock.

Actually, we sold into Swedish merchandise, you can say, to Intersport, Åhléns, Team Sportia, yes, everybody, excluding Stadium. So that was very, very good. And it's nice to don't pay the sponsoring fee and then get the merchandise. Yes. Here, you also see the different segments. In one way, I'm also pretty happy there that all 3 is growing even if it was very little, 2.7% on Gifts and Home Furnishing, it's at least a growth.

Yes, sales per geographic area. North America increased and Sweden was a very nice increase, I must say, because if you look at the market shares we already have and continue to grow, it's a very strong development. And Benelux slightly up, Nordic up. And there are Norway going quite strong. Now we finally see the effect of all the national teams we have in Norway. It took longer time than we thought, but now it's paying off. And rest of Europe heavily up, and that's mainly due to Cotton Classics, the acquisition and others quite heavily down, and that's only trading.

And as we have said every report, trading is extremely volatile up and down. So you can have 2 weeks coming in with a weekly sales plus 100% and then you have 1 week, minus 70% and so on. And that's how that business is. It's still very profitable for us, and it's a very good cash flow. So we want to continue this. But there, you have to get used to that it can come a very good quarter and next quarter can instead be looking bad and then good again. So it will continue that way.

And the reason is, of course, that it's quite a few number of clients compared with other channels and it's very big orders. So here, it's more or less if you are unlucky to -- or lucky to deliver in the right quarter if you look at the short term. Yes, the margin we have talked about. And there, we should also remember that the majority, I think, SEK 65 million, if I remember correctly, is write-down on the stocks due to the tariffs, which gives us a good chance to hold a strong margin in the U.S. market in the coming quarters.

And we will continue the same way. We will not use discounts and so on to blow up sales. And we will continue the same way. We will not use discounts and so on, very good gross margin in the coming quarters that we have in front of us. And we should also remember that, again, Cotton Classics came in, in the figures you compare with, with more than SEK 1 billion in sales with a gross margin on what is it now, it has increased a little bit by 27%, and it was 25%. So if you take away acquisition, I think it is the strongest gross margin we ever had external personnel costs continue to increase, and they will continue to increase.

But I think also that we will see a more normal cost increase and especially investments that are taking as cost from latest third quarter, maybe next year. It's a little bit hard to say. But then I'm talking also about existing business. If we do more acquisitions during that time and so on or we decide to establish one more new big warehouse, which I don't think we will do within 1 year.

But if we do, it can, of course, affect. But if you look at the normal business, it will come down. And there, we maybe should point out once again because I have some questions on that, too, that are different now when we -- in the past, when you change ERP systems. You put it into the balance sheet and then you write it off for 5 years. Now it's in the cloud, and you have to take a big part of this as cost day 1. So if you look for the coming years, we will have quite much lower depreciation in that.

And I think those changes in the bookkeeping it's really not good because it's very difficult sometimes for analyst and investor to compare. I think with the old -- do you dare to guess if it was working the same way as in the past, you took it as an investment in the balance sheet, the results so far this year would improve.

I don't dare to say, but it's a big difference because we have only trophy to give the system in 2 entities and we have a majority of the cost for the entire template. So it's a huge difference.

And therefore, again, I say I'm -- if we can hold an operating margin on this level due to all this investment at the same time, I take it as a proof that 20% is absolutely reachable, again, excluding acquisitions. You know that we love to buy companies for SEK 1 and SEK 1 company is not very profitable when you buy them. And we will continue -- we want to continue the same type of acquisitions if we can and if we find them. And you can say that all those kind of acquisitions has been quite successful over time, excluding all of our customer.

So we are continue to look at companies that are in a problem. It's, of course, not easy to buy them and especially not to find them. But excluding that, I think the margins are very, very good. Yes, 11.3% in operating. And you can say you see on corporate since Cotton Classics is 100% into the corporate sector. It's lower there. Sports & Leisure increased quite good. And there also the majority of the majority of the minority of the money we came back from tariffs is in Sports & Leisure. That's also one reason.

And Gifts & Home, at least finally a positive margin and not negative. And there, I now think that in that area, we will never reach any 20%, but we should manage 20% in average anyhow. But I'm very happy if we can actually come up to at least 10%. So we can quite consider it as a problem. Cash flow is also quite okay, I think due to the -- again, to the investments we are doing, I think it's even stronger. And in the cash flow, the effect is not yet seen by the tariffs either. So I'm quite positive to that.

Yes. And also in addition, Torsten mentioned the ERP investments, they are not shown in investing activities in the cash flow from operating activities. That's why that...

Balance sheet continue to be, I would say, very strong, which are -- we are very happy for. We still have room for more acquisitions and later on more establishments, which I think is also very, very important to have a strong balance sheet. Dallas, 10 million units, we can store there. And it's the most advanced in automatization and technology in the whole group, including AutoStore and embroidery, direct to garment decoration and so on.

And the main reason is, of course, that we have a lot of actually also existing clients that we don't serve in a good way today in that part of the U.S. So I think it will go quite quick to come up to breakeven. And if we can reach breakeven 6 months or something on that fulfillment center, I think it's very good. And it really means a lot for the future growth in the U.S. market. I got a question earlier today, how big we can be in U.S. or what is the level we can take. And we should remember that we are still extremely small in U.S. I haven't counted the market shares because I don't have enough zeros in my calculator.

So if we really succeed there, it can -- it should be -- nothing is easy, but theoretically, we can at least do 10x what we're doing today within 6, 7, 8 years. So -- it's a very interesting market. And it's also interesting because I was misjudging U.S., as I said in the earlier report because I thought that U.S. should be our most difficult market due to all things with everything from tariffs to a terms different decision to the war in Iran and so on. But I repeat that it seems that Americans have some kind of gene in the body that we don't have in Europe that they just continue buying whatever happened. That's actually a feeling. So U.S., I think, will have been one of the strongest markets also in general the last years.

So it will be very interesting, and I'm quite excited to this. And I go to U.S. on Saturday morning, and we'll meet the people responsible on Monday. Toppoint, we have not talked so much about before, but it's a company we have doing hardware located from the beginning, a Dutch company, but located with the production nowadays in Poland since quite many years. But there, we start up 35,000 square meter big production facility started in May. It also cost a lot of money also in actually decreased sales for a short while. It's very modern, 25 different printing techniques that we are quite dilemma about, many products available in 24 hours. We do that we are at the same level or better than the competition after this.

So this is also very, very interesting to see what we can do there. And you can say we have still 2 areas on the corporate that we in a European perspective are quite small. And Toppoint and hardware is one of them and the other one is workwear. So it would be theoretically easier for us to continue taking market shares in this area than it is on corporate in most European countries.

Yes, this I mentioned, without stock, we have lost all the things just -- this is again a proof that especially on merchandise and happenings and those things, it's speed to market that are the absolute most important thing. So now we hope that in more of our big countries in the future, the countries qualify but very late. Too early, sounds good. For the first time also, we have a champion playing in Craft. It was Aarhus that won Danske Superliga, which we are very happy for. And Craft is really moving forward on the teams. Another nice example was that you had the first game. I think the second game is still left to play between IFK Gothenburg and KAA Gent.

I think it was the first time it was 2 teams playing in Craft in a European. So it's really moving. And Here, we can also see sometimes it's very, very difficult for us to also give forecast on some things because if Aarhus wouldn't win, then we probably have sold merchandise for SEK 20 million lower. So this is also quite important. So I have nothing against Sirius, but now I hope that Hammarby is passing. And it will be very nice to have both Danish and Swedish champions as well.

This is one of the biggest events we ever have supplied Royal Run in Denmark, 112,000 runners. I think it was in 6 cities or 8 cities maybe even. And all of them, those 112,000 run in a Craft T-shirt. It's fantastic also, not only fantastic for the sales, it's also fantastic for the exposure of the brand. So it's happened quite a lot in those areas. Half year, it's not very much to say there in one way because it's more or less following Q2, and you don't have any big effect on the tariffs if you look at the half year figures.

As I said before, Q1 would be a bit better, Q2 a little bit worser. Half year is quite great. Yes, SEK 4.9 billion -- million, not billion yet. 10.2% up in sales, corporate, 14.4% and retail 2.0%. And again, the big difference there is also that Cotton Classics, of course, was not in first half year last year. Yes. Not so much to say here. Geographically, you have pretty much the same picture. North America, minus 2% is due to currency and the currency effect there for first half year, I don't have it in my head, but do you have that Anna.

Okay. Sweden, plus 6%. There, I must say that if I'm a little bit negative surprised in, for example, Great Britain, I'm positively surprised in Sweden because to have that growth rate with the big market shares we have here is very good and especially when you don't use discounts and so on, you really grow on full margins.

Minus 8.6%.

So on half year in local currency, U.S. is plus 6%. Benelux, plus 5%. And there, we now start to see a positive effect of the automatizations we did in New Wave Netherlands last year. We have been operating there since May last year. And for a while, we lost sales due to bad service when we had all the movement and so on. Now we start increasing again. So that's good.

Other Nordics, 5% and rest of Europe, plus 43%. And the reason for plus 43% is the main reason, I should say, not the only reason, but the main reason is again Cotton Classics. And others minus SEK 23 million, and that's one single reason and that the trading came in low in Q2. Yes. Corporate, minus SEK 33 million. Sports & Leisure plus SEK 57 million and Gifts & Furnishing an improvement on SEK 70 million. Cash flow, also pretty happy with that also if you look at the half year. And that's, of course, also one of the reasons we continue to have a strong balance sheet, which we will keep strong even if we do acquisitions. So that's more or less that. I think we'll open up for questions as well. Yes.

Andreas Lundberg with SEB. If I start on the outlook comments, you seem that you turned somewhat more positive versus previous quarters. What are you seeing? Where do you see it? And where do you don't see it?

We see more positive clients, more positive comments. We see better figures. But again, I'm a little bit scared without having figures how it was in mid-Europe during this summer. But otherwise, sports retail, for example, has the index there have improved. The clients are more positive when I talk with them and it feels also more stable. Then I should maybe add that it can still be surprises because I go to bed in the evening and I don't know what I'm doing during the night when I wake up.

So it can -- I think it can still be a little bit up and down, but it feels much better than 6 months ago. And the first -- the first time we really will see if I'm right, is pretty soon because we will start doing the presales in sports retail right now and do it for 6, 8 weeks in forward. And then we will see if the chains really also act as they say that they are more positive and increase the preordering because if you look, for example, in -- if the sports index is good in Q2, we will notice that in Q3 when they place preorder and we will get into our P&L in Q1, Q2 when we deliver the preorders.

But also corporate market feels a little bit more -- not a little bit, it seems more stable and people are also there talking more positive. Then you can say sometimes it's difficult to judge if it's -- that they are more positive because we have launched new products and do all this investment or if they are more positive in average in general. But we feel -- I feel more confident than 6 months ago.

And different topic. You mentioned a few things about the Dallas factory. Can you more broadly talk about the -- what it will mean for your distribution or logistics in the U.S.? And how will the other facilities be affected?

I don't think it will be affected so much. And I should also say now we will not invest in any new big warehouse in U.S., at least for coming 3, 4 years. But if the outcome is what we think on the Dallas warehouse, we need another 2 facilities in U.S. but to really cover the country. But that will be earliest in 3, 4 years. But we don't think it will hurt so much because we really give a poor service in that part of U.S.

We are covering down to -- I shouldn't say South U.S. because we are pretty fast down to California. But if you come to Southeast or South Mid, we are very, very slow. And we have several competitors there with the warehouses in that area. And they are today much better than we are. And they will not be better than we are 3 months from now.

If I may, last one, and I will let someone else in. Speaking about the U.S. and the teamwork set up there, the teamwear, can you give us an update on teamwear club in the North American business?

It's moving forward. I could say that it's a little bit less than I expected. It takes a little bit longer time, and it's also some differences we really learned to need to learn. For example, I think you all know that most of the teamwears business is running in through schools and not through teams and so on. You have that in several sports, the whole league is blocked because they sell the league, they don't sell the teams and so on.

So it's -- but it's a positive development, and I still believe in it on the same level as I did from the beginning. And it's working due to service and so on that really have been one of our weapons in Europe. The competitor is not better in U.S. than they are in Europe. So yes. And before you ask, I can also comment that the shoes also continue to increase, but a bit slower there.

I'll take the chance to jump in Karl-Johan Bonnevier, DNB Carnegie. You mentioned that you would have expected 4%, 5% organic growth in the quarter and still craft looks good and a couple of other things. Where do you see the shortfall compared to your expectations?

Mainly, you can say it's actually trading. And it's also if you look geographically, great. Then, of course, we should have a better effect also on the launches or the merger of our 2 companies there. So I don't know the organic growth if trading had delivered the same, have you checked that?

[indiscernible].

And looking in U.K., is that BTC that is not really working as up until compared to your competitive expectation?

Yes, yes. You can say that Cotton Classics is actually doing at least what we thought and maybe even better. So it's going quicker. BTC are going slower. So you are correct.

Looking at the custom duties refunds, you mentioned most of it is coming through in Sports & Leisure, as I understand it.

Yes. I should be clear there as a segment, but this is very tricky because if you look at channels, I mean, Cutter & Buck that have received most is in the segment, Sport and retail. But the main -- their main sales is in channel corporate. So it's a difference between those and it is below the IFRS.

We can agree on that, I think, overall, but their table is in that [indiscernible]. And looking at both the inventory impact and the cost of goods sold impact, when would you see the similar kind of effect on cash flow? Because I guess there is a delay there compared to what you see in the P&L. And when you look now at the inventory levels at the end of the quarter, so you had a continued inventory buildup in Q2. What kind of growth rates do you see that being able to sustain if the market is there in the second half?

Organic, we can at least go up to 10% if we can sell so much. But the warehouses on the stock is not a problem. But don't take that as we will have 10% organic. That's why we couldn't...

Emanuel Jansson, Danske Bank. Jumping on moving forward to the organic then. I mean, given that you are in this heavy investment phase, is it fair to assume that you need to grow by double digits organic in order to sustain higher EBIT margin at the moment?

So we have a very big, so to say, fall through in the P&L. So we don't need to go up to the 10% -- but if we really should be able to deliver a high operating margin with [ 8% ] organic, but we should also remember that -- sorry to say Dallas all the time, but we can take Toppoint also when you open up something. I mean, Dallas, we take the cost every day, and we're not start sending out one single garments from there. Start will be October.

Toppoint decreased sales for the first time in many years during the period when they had all the moving and everything. So I think we can be there. And we also have now launching Tenson in U.S. It will not be any big effect this fall, but hopefully next fall. And we also have some lines -- new products and lines we will launch in January on corporate. Craft is coming with indoor shoes, which we think is actually in one way, an easier market than expensive running shoes. So we have a lot also in pipeline there. We have taking a lot of costs in the P&L that we have no income at all on yet. But that's how we have done many, many, many, many years.

And did I understand you correctly that, that will continue until the third quarter as of next year?

Some of them will, of course, always continue. I mean we need to develop new products all the time. It's just that we have done it more than normal in the last 2 years without seeing movement and all those things. But we can never stop that because then we will probably have a negative growth 3 years later. But some of the cost, for example, automatization of warehouses, a lot of warehouses is done.

Then it's another story if we, for example, make an acquisition and say that we need to automize that warehouse. We are a bit keen on the coming 2 years, maybe, establish a warehouse in Germany that are automized for Cotton Classics. But most of them can it be 75%, 80% of the warehouses is now done there we actually need automatization. So it's much less investments in future in that perspective than it has been in the last years.

So you're happy if you're able to defend the EBIT margin from this level until next year?

Yes. I think we can start and really see an improvement, again, excluding acquisitions, we will see an improvement from the second half next year in operating margin as well. And if we can hold it until then through those investments period, I think it's very good because if you look at the underlying profitability, it's really nice.

Perfect. That's very clear. And just curious, we have seen several other retail names reporting Q2 numbers describing the weak German markets, RevolutionRace, Fenix Outdoor, H&M. And also, I think Klarna also mentioned the weak consumer sentiment. You don't experience that or what you do in...

We do, but not so bad as we write into the report. But Germany, I think, as a country is under a lot of pressure and the consumers there are in one perspective, weak. I can take one example. We had the former CEO in Intersport with us on the trip. I met them in Germany and me and Goran was down to Poland afterwards. And there you have I think that I was a little bit surprised of. You can see how fast things are changing because the German Intersport dealers on the border to Poland just a few years ago had the problem that consumers in Germany was buying in Poland instead because it was cheaper.

Now the shops in the border in Germany is going very well because it's Polish people coming over and buy in Germany. So it's really fast changes. And I think with everything with the car industry and so on in Germany, it will be a tough market. And we should also remember it's a market that everybody wants to be because it's so big. So the competition there are much, I would say, much tougher than in many other countries.

Perfect. And final question, you mentioned Craft. And is it fair to assume that both the teamwear running business is doing well, but also the retail business within Craft?

Retail business in Craft has not done well for some years. And it's not like we are losing shares to other. But as you know, the sports retail has been terrible in several countries in the last, I think it's 3 years.

And it's still not doing well in this quarter, the retail business, I mean.

But again, before you see it in our figures, because everybody knows that if, for example, Q2 comes out strong for the retailer, they will increase the buying -- the preorders they place to us in Q3, which we will deliver Q1 and Q2 the year after. You always have this lead time. So we need -- before we really will see a positive effect in general from better retail sales, it will take 6 to 9 months. And then, of course, sometimes we can have a small effect that they need to buy in season if they are doing very, very well, but so good is it not yet.

So I guess the cold weather in Q1 and also sport index data was quite good in Q2 as well. The inventory level should be quite good.

Lower than before is we expect and we expect higher preorders. But you never know. And now I hope that in one way, I hope that they don't place too much for the winter, I would say, is most sensitive because in the past, it has been many, many times that they do a big winter or good winter. Then they think that next winter will be even better and then they place 2 big orders. And then that winter is not so good and then you have a bad effect the year after. So...

Alice Beer from ABG here. Just a few questions. First on Cotton Classics. What's the gross margin like for Q2 compared to last year for it? How is that earnings development going inside of Cotton Classics?

I have -- we don't release but it's improved a little bit.

What we actually measure all the time is how many percentage, but we don't publish that, but how many percentage of Cotton Classic's total sales is turning into New Wave brands. So on...

Yes. And I was just about to ask that, has that increased in the pace that you expected? Or how much would you say that's now?

I would say at least, is the same as we have expected, maybe even faster on -- especially on some brands, but that's also product groups that they -- that don't have any competition with external brands. So for example, Craft is doing very good in Cotton Classics, but they didn't have any sportswear before. And the competitors don't have any sportswear either. So the teamwear, for example, is doing very, very good in Cotton Classics.

Okay. Great. And then a more general question. There are a lot of moving parts affecting both sales and EBIT and some things you can control, some things you can't short term looking at maybe H2. What are your priorities for increasing or stabilizing margins or increasing organic growth out of the things you actually can't control?

I think goal #1 to do that is to keep the gross margin on a high level because if we -- yes, you can calculate yourself if we would have discounted more and be down on 46%, 47%, it wouldn't have been looking so good. So we will really do everything we can to keep the gross margins up.

And then I don't think we can do so much more than we already are doing to increase the organic growth actually. Of course, it will help with the launches we're doing in U.S. and Tenson and so on. But again, it takes 6 to 12 months at least before you see any effect in it. So -- but hopefully, also we have done a lot this first 6 months that hopefully will pay off better last half of the year.

Nicklas Skogman, Nordea. Did you raise prices in the U.S. to offset the impact from tariffs and [indiscernible] so do you then expect.

It's so much depending on in the total, I don't have any good picture because it depends so much on what product they get hit. If the tariffs hit the one color T-shirt, it's extremely difficult to take a price increase on that because the competition is extremely, extremely hard. If it's hitting a craft jacket, the consumers really don't know, if the price should be $90 or $99. So -- and how that has spread out average, I can't answer.

All right. So you don't expect sort of prices going down in the U.S. market.

No, no.

No. Okay. And then going back to the corporate segment. So if you strip out trading, it was minus 3.8% organic growth, right?

Yes.

No, what you're saying. Nicklas? It was plus 3.8%, not minus.

Trading impact?

Yes. So if you strip out the trading impact...

Organic growth is like for like excluding trading.

Okay. All right. Then I miscalculated that one.

Or we?

I want a correction if you're wrong. So in the first half, through underlying cost increases are around 12% for external and personnel costs, stripping out acquisitions and FX. So is that sort of -- do you expect that level also in the second half? External and personnel?

First half year, but I really do H2 in 2025, we didn't have -- we have very little cost and next time we started referring to the ERP. But as from Q3 2025, we have started taking costs for the ERP. And so when we compare now in Q3 2026 to Q3 2025, it will be more comparable.

Stefan Stjernholm, Handelsbanken. A question on the Gifts & Home Furnishing segment. You said you -- long term, you could reach 10% margin.

I hope.

Yes. Apart from a recovered market, what is needed? Is it time for another structural measures or...

Probably also some more cutdowns in our own production, which we are working with.

So there will be more outsourced?

Yes. If we really to strengthen the gross margin, it needs to be that. But at the same time, it's no plans to close production because it still means a lot in the total, but we have too big production capacity today that we gained too low margins on. But it's also certain products different in different product groups. If you look at Art glass, we have fantastic gross margin. But if you look at the hand-blown wine glass made in Sweden, it's very bad. Excluding actually the new line that [indiscernible] there you can hold a pretty good margin even if it's produced in Sweden.

Andreas at SEB again. Some confusion maybe from my side on the cost of the temporary costs that you partly will normalize next year. But if you look at the last 12 months and look 12 months forward, how will that figure change in absolute terms?

I don't think it will change much in the coming 12 months. I think we calculate and I wrote that it will start to go down in the second half of the year next year, if I remember correctly.

ERP, and we have also, like Torsten mentioned from Dallas now, we have third-party warehouses that we keep having inventory and move the inventory into Dallas and some other additional costs.

But it also depends a little bit how you mean because according to sales and turnover, it will hopefully be down because, again, to repeat Dallas, we spend a lot of money there, both in investment and cost with not one single extra income in sales. So if you look at -- yes, in percentage of sales, it will hopefully start going down earlier than second half next year.

Right. Meaning that your organic growth and the gross margin will be the drivers of your operating margin in the next year -- quarters.

Yes. We got some questions from the web. And first, Kosta Köpmanshus which New Wave Co owns with Lessebo municipality has been valued for a potential sale. Are you interested in increasing your ownership stake in the property?

No.

Yes. Computer software in your intangible fixed assets continue to increase in 2025. Should we interpret your statement about transition to cloud computing as that this figure in the balance sheet should start declining in 2026 and onwards?

I'll turn it to Anna Gullmarstrand.

Yes, I can repeat. Computer software in your tangible fixed assets continue to increase in 2025. Should we interpret your statement about the transition to cloud computing as that this figure in the balance sheet should start declining in 2026 and onwards?

We don't -- the thing about the cloud solution is that we don't get it as an intangible -- we don't get it as an intangible asset. So it is -- the small part that is put in the balance sheet is put there as a prepayment and dissolved over the license period. And the rest is going directly in the P&L expense even though on day 1, even though we consider this as an investment -- it's something that we do that we will use for 10 -- at least 10 years, but the cost is upfront, even though we're not even using the system yet.

The answer is yes on the question.

Yes.

But maybe you will not see any big effect in 2026, I can't say that. But the result again, when you take a lot of the ERP system as costs instead of putting into the balance sheet is that we will have in one perspective, lower depreciations in future than we would have with the old bookkeeping system.

Yes, we won't even get any depreciation. All will be in the external expenses. So it's a shift in that perspective is what between the time.

Yes. Perfect. That was all of the questions.

Okay. Any more questions on the table? Good. Thank you very, very much.

Yes. Welcome to the presentation of Q1. I can start describe it as a very stable quarter. We are a bit -- or I'm a bit disappointed that we still don't see any better markets. I say that it's the longest period ever for me. And then we have been on the stock exchange for 30 years when it's weak markets and unstable every time. And Fortunately, I can say that I'm not the only one that I thought that the market should improve in the last 3 years, but it's still not happening. And I think as long as we have all this unsecurity about the wars in Ukraine and in Iran now and also in [ Gaza ] before, together with politics that we have in U.S. right now with -- or have had for a while with heads and unsecurity and I don't think it will come a quick turnaround. But I'm happy anyhow that we continue to take market shares. We continue to grow. We have quite good growth in U.S. actually. I see that U.S., I would describe as a better market than Europe, which is a surprise in some ways because I was more worried for U.S. and Europe, if I go back. 2,800 -- just about 2,800 employees, 28 countries now. And we're selling in a few countries more than that where we have agents and distributors. And the same 3 segments as before. Yes, this year, all new, I think, corporate, sport leisure and. If I should comment the market a little bit, the corporate market is more stable. It's not good, but it's more stable than retail. I saw some statistic I think it was last week on clothing in Sweden, and that was actually growing with the clothing retail was growing at 7%. So I thought maybe it will be a turnaround. And then come the e-commerce out today or yesterday, minus 90% in Sweden for March. So it was the worst month for e-commerce in a long, long time. But the corporate is more stable. The retail is more tough and a big part of the distribution and clients in Sports & Leisure and Gifts & Home is, of course, retail and clients then. If we look at the quarter, first of all, the currency still had a very, very big impact. So the growth in local currencies was 13.2%, which is not really enough to really make good results. You can say we are close to -- we need a 3%, 4% higher organic growth to really deliver good and improve net profits and operating margins again. But I'm quite sure and confident that sooner or later, we will have that growth because we should remember that we are still in a tough market. Organic growth, 2.9% and here, we do everything we can to get that up to 5%, 6%. And if we succeed with that, it will be -- it will come down to the last line as well. Gross margin, very, very strong, I would say, 50.4% or 50%, sorry. And that's part of the explanation is that we have lower volumes on trading. But we should also remember that Q1 last year, we did not have Cotton Classic that are around 25%. So I think it's a record high gross margin if we consider that they are into the figures. And operating profit,[ SEK 200 million ], just a little bit lower than last year. And I think it's a stable result. I think on most areas, we are delivering still much, much better than competition. If you compare the bigger retail brands like Puma and Nike and so on, it's far better figures. And the costs continue to be high, 2 reasons -- 2 main reasons, ERP systems that we changed, and that will go on for another year.

2 years.

For another 2 years. And a lot of this is, of course, extra cost because we're operating 2 systems right now. I don't know how many have we implemented in? How many companies are they new? France, Netherlands, -- so hopefully, it gets smoother and smoother as more companies come through this. And the second thing is, of course, investments we are doing in new markets and also in new warehouses and automatization. The really big one going on now is that we open up in Texas. Hopefully, we're in operation 1st of October. And that is a pure investments for the future. We are not service South U.S. in a good way right now as we do in North since we are based with the 2 warehouses we have. We are based in Seattle and in Renton. [ -- no sorry, in Kentucky ]. And this is -- the investment in Texas is much, much bigger than the normal warehouse investment because we go for a full operation, same as Seattle within Brody and automatization from day 1 and everything. And it will cost some money in the beginning, but I'm very, very confident it will be a good investment. I think it's around SEK 200 million. We invest there. now. And then we should not forget smaller investments like we opened up a warehouse in Ireland in January this year and so on. So we are on a pretty high cost level for the moment, which will not be a problem actually if we just can get this 3%, 4% more growth. Sales, plus 6.6%, again in Swedish krona. Local currency is 13.2%. Promo channel increased 10.8%, retail down 0.9%. There we should also remember that Cotton Classic comes into the corporate. So that's what makes it such a huge difference between them. And the growth is in promo. It's, of course, the acquisition, but also the new launch we did that you have behind you, [ Avic ] Movement. And also cat is doing very, very good, both in U.S. and Europe actually. It's not so much to able to comment this. If we look geographically, in the U.S., it's minus, and that's only currency. Enter which one is Enter. Yes. you have an organic growth in U.S. by 7% in local currencies. So it's really affected the currency there. Sweden is nice to be back on a very small growth, which I think is a very, very strong sign in this environment. Benelux is doing well. Nordic countries, excluding Sweden, growth as well. Rest of Europe also and other countries is a little bit down. And there, you have the trading. So you can say in local currencies, all regions are growing, excluding than other countries that are mainly the trading business. Gross margin, I'm very, very happy with. I think it's very few companies and competitors that actually report higher gross margins in this environment. And we will try to keep it there. Of course, it can be or will be in the future also if we have quarters where the trading comes up a lot. It can be down, but I think it's very, very stable due to all our own brands. External costs up and there we should -- it's [ SEK 8.

92 million ] up. And there, we also have for us, positive currency effect. So actually, the cost increase are even higher if you look at local currencies there. Yes, that's mainly then operating profit we have talked about. If we look at the different segments then, Sports & Leisure are improving a little bit. Corporate a little bit down and Gifts and Home Furnishing a small, small improvement. We should also remember that for some of the companies, Q1 is an extremely small quarter, not even at the time when -- or the best years, for example, in [indiscernible] , it was profitable Q1. So I think this picture will change a lot when we are at the end of the year. Cash flow, I would also describe as very stable. And that's good. I feel very happy for the balance sheet that we have today that give us quite a lot of space for continued growth in investments and also a lot of security that we feel very, very safe in this. And now we probably will have a little bit lower cash flow or worser cash flow in maybe in your eyes when Texas come through because it's not only the investments, we have also built up the stock there. It's no idea to have an empty warehouse. And that's quite a lot of money. So we can be prepared on that. Balance sheet, again, very, very strong, I would say, probably one of the strongest if we compare with competitors in all 3 segments with an equity on over 55%. So it Yes, it's a good feeling. And also, it's nice to say it because even if the -- so to say, the markets don't improve, if we can keep a decent profit level and this balance sheet, we are in an extremely strong position. And we are, I would say, one of few sometimes that could be really patient and continue also long-term investment in more tough times. Cotton Classic is, I would say, doing very good. And the implementation of our brands are doing well. We launched them first month in September, actually 15 last year, came the first catalog out. But then no of our brands were still in their main catalog that are released in January. And now all those plus 3 new is in their main catalog, which comes out actually in mid-January and the road -- the road show is from mid-January to mid-February. So actually, if you look at the first quarter, it's more fair to say that they have sold our brands for 2, 2.5 months than 3 months. And was it 4% now? So already now 3.4% of their total sales is our brands -- in March, sorry. And interesting is also to see that the gross margin on our brands is between 2 and 3x higher than the gross margin that they have on the distributed brands as an outcome actually, not what we think. So I'm happy with that, and it's also a new CEO in place that we have a good feeling for. So that's basically that sense. I think we open up for questions.

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

It's not really any very big effects, but the number of small delays and small problems have, of course, increased. But I'm -- as I said in the earlier report, I'm very happy that we also moved a lot of the production in good time to Africa. If we are as depending on China today as we were 3, 4 years ago, then it would be huge problems. And then we will see what's happening with the freight cost is, of course, a bit worrying. Oil prices, we talked about in the beginning, will probably -- I mean, our CDO and buying manager expect if the oil prices on this level, we expect a 20% decrease on raw material on polyester raw material within 6 months. So -- but again, also, we have -- I'm not nervous about that because we have always been able to change our pricing and not be so effective. In one way, it can be positive if the prices start to increase a little bit for the sales...

And obviously, fantastic gross margins in the quarter, particularly looking underlying. It seems like there is a big, say, craft and Cat Back effect, as you mentioned. Could you describe a little what's going on underlying there?

But it's on record levels, and I'm very happy with it, but we have a very strong positioning for several of the brands. Like you mentioned, the 2 most obvious is Cat Back and Craft, of course. So I feel very, very confident and also the new collections like Anti Movement have been received very, very well in the market. And it also opened up new clients for us. For example, if you take theoretically because we don't have them, but theoretically, we can sell under moment as merchandise to every club, whether they are contracted by Adidas, Nike, Firma or ourselves because those don't have the merchandise on stock. And now with the neutral label, it's opened up quite a lot of new markets.

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

I pass that to you.

It's correct.

Yes. Now we are doing the implementation in the U.S. with Cutter & Buck, which will be made step by step. So we don't implement it in one time. So we start with implementing one of the warehouses, then the second warehouses, then we also changed the financial part. But it's an important step also doing the development of the template that we use. And after that implementation, it will be smoother and more cost effective when we continue the rollout.

But if I remember correctly, when we changed the ERP system in Cutter & Buck, was it 20 other systems that was affected? So it's not -- yes, you put in one thing and then you're ready.

When you speak of weak market, what exactly is weak and what is driving this? Grateful for more color on this and how it affects New Wave's business.

The retailer market is, as I said before, especially weak compared with the corporate that are more stable. You have a quite, I would say, weak market and negative best case, neutral consumers in most of the European countries. And I think the reason for that is again the unstability that creates in a politic way today and also all the wars that have or are going on. and the consumer are definitely holding back their spending's. And that, I would say, it's valid for, I would say, more or less all European countries, maybe Switzerland is an exception. They live their own life. But otherwise, it doesn't matter if you look at U.K. or Germany or also Nordic countries.

What was the gross margin for Cotton Classics in Q1?

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

We don't subsidiary.

You said that the rollout of the new ERP system will continue another 2 years. Will the quarterly costs related to the implementation go up or down in the coming quarter? And what was the impact on Q1 EBIT?

I pass that to one of you.

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

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

Definitely, but this will take some time. And I think the best thing to do is to actually, which we are looking into establish a totally new warehouse because going with automatization in the current one is -- would be maybe not a nightmare, but very difficult at least. So what we see in ForeFront is a new cotton Classic warehouse probably in North Germany and then continue with old warehouse for distribution in the East and Austria and those countries.

Maybe you already answered this, but in Q4, you gave the underlying margin adjusted for Cotton plastics. Would you care to do that here also in Q1? -- [ underlying margin ].

The same question, but it's -- we don't give specific margins for specific companies, but undiluted from the acquisition of Cotton Classic, it was 52.5%.

Could I please ask what drives the weak Sports & Leisure margins?

What...

What drives the weak Sports & Leisure margins?

Very good question. But I think a lot of the investments we are doing there is hitting that area because the Cutter & Buck, where we do the new investments in Texas is belonging to that segment. Crafts establishment in U.S. that are quite loss-making in the beginning is that segment and so on. So it's much more investments and costs going on there than it is in corporate. But it's also interesting because Cutter & Buck is a part of Sports & Leisure because that was classified that way when we acquired it. But today, the majority of the sales in Cotton Classic are corporate. So it's not 100% fair. But most of the investment is in Craft and Cutter & Buck.

And also regarding Cutter & Buck in Sports & Leisure, it's the big currency headwind. So it was minus 13% from currency really. So that, of course, affects Sports & Leisure most.

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

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

Good question. We discussed that yesterday actually. And I think we will try. I read now that some of the biggest corporations are avoiding it because they're scared of Trump. But I don't think we are so big, so we will be focus. So I think we should dare to try. But then we should also remember it's not extremely much money, if it would be that we would have worse result last year, so to say. But we will try to recover what we can, but it's not much. And of course, it's depending on again that a lot of the goods we have taken in the U.S. the last 1.5, 2 years has been Africa, not the countries that have been hitting worse by the tariffs.

How do you view the decline in gifts and home furnishing linked to the fact that the overall retail share has decreased for several years?

Yes, it's the toughest job we have is to turn around that part of the -- or that segment, and it's still very, very tough. So I mean, we try to continue to decrease costs. We try to have higher efficiency in the production, and we try to find new distribution channels. But it's a headache. That's the only part in a way where I'm happy if it's a small part.

I think that was it....

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

Okay, thank you very much.

Okay. Welcome to this presentation of New Wave Group's Quarter 4 and Full Year 2025 Figures. My name is Goran Harstedt, and I'm the Vice President of New Wave. And together with me, we have Anna Gullmarstrand, CFO at New Wave. New Wave Group, we are a growth-orientated international company, and we are focusing on acquiring, developing and creating brands for 3 business segments, and that's the promo, the Sports & Leisure and Home & Gifts Furnishing.

Here we have a slide about the growth in net sales and profit during the years. And we have a good development, especially regarding the turnover the last years. Logistics and sourcing is one of the main drives for New Wave and our activities and one of our most impressive strengths compared with the competitors. We have a big sourcing operations in Asia, where we had a head office in Shanghai and working in a number of countries and now also in Africa in order to source our products in a competitive way and also in a sustainability way.

Here's our 3 operating segments and sales channels. And you can see here the brands that we are using in these segments. It's especially the Sports & Leisure and Gifts and Home Furnishings brands that are known for the public due to that the corporate brands are more service brands for the concept towards the resellers who sell it to the companies which then is using their own logos or message on the items.

A brief summary of the quarter. We signed a new financing agreement in December, and it have a prolongation for 3 and up to 7 years, and it amounts to SEK 3.8 billion, of which SEK 2.7 billion are used at the moment.

Cotton Classics is consolidated for the full quarter for the first time in Q4. And during the last quarter, we also finalized the discussions and negotiations with the U.S. Department of Justice regarding the forgiving PPP loans. And the result was in line with the cost that we were taking in Q3. We also have quite huge effects on the currency for the year and especially the quarter.

Then we have the financial information, please, Anna.

Yes. Thank you. So the quarter in brief, we have, in short, growth in both sales channels and all 3 segments. In local currency, we grew by 17.7%, of which 11.7% is from the acquisition of Cotton Classics and 6% from organic growth in local currency. And as Goran mentioned, we have a headwind from currency, which is minus 6.5%, but still reporting a growth of 11.2%.

Looking at this, I think given the tough times and troublesome -- a bit troublesome times, it's -- we're quite happy with the 6% organic growth and feel that it's a proof maybe of the model that we have with diversified diversification and different sales channels and are happy to show 6% organic growth.

Looking at the operating profit, it was SEK 435 million, which is a bit lower than last year. And the operating margin ended at 13.8%.

And going into the details, I can see here about the sales per sales channel. The sales were SEK 3.145 billion for the quarter, which is, as we mentioned, quite higher than last year. And as you can see, we have increased in both promo and in retail. And of course, in promo, Cotton Classics is one of the big parts, but we also have growth within several brands like both Cutter & Buck and Craft are doing really well. And we also see growth in the trading and Tenson has also had a good quarter. So -- and this is the sales per operating segment.

Again, currency has been tough on us this quarter, but we show increase and growth in all 3 segments. As shown and again, of course, [ in corporate gift ] and Cotton Classics.

The currency, we keep coming back, but it's -- this is a picture where we can illustrate. This is the sales divided by the geographic areas that we report on. And as you can see, looking at this, it even looks like there are 3 areas that we might have a decrease instead of a growth. And if we look -- talking about currency, you can see the American dollar has been really tough in this quarter is minus 13% to us. And the euro, not as much, but it's all -- this is what makes up the net of the minus 6.5%. So taking that into account, this is the organic change, the change in local currency. So what started as a minus, you can see we have a really good development in North America, which we're really happy for. And also looking at this, it's actually only one area where it's still a minus, and it's the other Nordic countries. And that is actually explained quite easily.

I think many of you remember that in the beginning of 2025, there was a Nordic Ski World Championships in Trondheim. And if Torsten would have been here, he would have told you exactly how many athletes were competing in Craft, winning in some kind of medal. I don't remember that number. But of course, in Norway, we had a lot of sales in the end of 2024. We did not only address the athletes, a lot of other sales as well. So that kind of sale, we didn't have it at the end of 2025. So that is mainly what explains other Nordic countries.

Move on to the gross margin. For the quarter, it's 48.5%, which is lower compared to last year of 50%. This is the first quarter that we have included Cotton Classics, an entire quarter. And they've affected the gross margin by 2.8%, which is natural because they have a different kind of business. So looking at like-for-like, gross margin would have been 51.3%, which we think is really good because it's actually better than what we had last year, looking like-for-like.

Moving down to external costs and personnel costs. They amounted to SEK 1 billion compared to SEK 887 million last year, which is an increase of SEK 108 million. And of this, Cotton Classics, the acquisition is half of the explanation of this increase. And in the fourth quarter, we also have a lot of costs regarding our new ERP system. It's actually an investment. But as accounting regulations are these days, instead of putting it in the balance sheet and taking it through 10 years, for example, this comes as a cost day 1. So it's not anything that makes the ERP more expensive, but the cost is shown much earlier in the P&L. So these 2 items together make up for 80% of the increase in external costs and personnel costs.

Yes, as we said earlier, operating profit, 13.8% in operating margin. And the operating result is divided like this, as you can see here on the slide between the 3 segments. Yes. Nothing to add there.

Cash flow for the quarter, SEK 534 million from operating activities. And what's worth to mention, it's fairly in line with last year, but it's worth to mention here that all the investments that we make in the ERP system, no matter if they are directly in the P&L or if it's somehow accrued in the balance sheet, it's always in the operating activities. So that never goes as investing. That can be good to know.

And as you can see, investing activities, we also have a lot, and we have been investing both in automization of inventories and buildings and -- that's mainly we can see by the end of December or by the end of the year, in December really, we started -- we've told you that we are building a new fulfillment center in Dallas. So the first investment in that took place during December. So we're looking ahead. We're also looking at Ireland for a new warehouse.

And also the warehouse in France...

Yes, of course.

We were completed in December. And we are also building a new facility for Toppoint in Poland with printing, et cetera. It's a larger big establishment we make in Poland that will be ready during late spring this year.

That's our investment. Happy to have a new finance agreement.

Okay. So the full year, you know about this really now when you know the quarter, but it's happy to have Torsten here too, on picture at least. For the first time, above SEK 10 billion in sales, which is a milestone and encouraging, as he says, and we're looking forward to a journey of growth many years ahead.

Looking at the sales divided by sales channels for the year. We have -- for the year, the increase is 5.1% reported increase, which gives an organic growth of 9.5% in local currency since currency effect is minus also for -- minus 4.3% for the year. So promo has an increase and retail is fairly even compared to last year.

Looking at the segments, we have, even though it's small for Gifts & Home Furnishings, a growth despite the currency again through the year. Corporate, of course, includes 4 months now of Cotton Classics since they are included as from September 1.

This is the same we can see the geographic areas. And I haven't added the currency here, but it's the same, of course, and headwind. But in local currencies, we show growth. And you see rest of Europe, it seems like there's a lot of growth. It's, of course, one important matter there is that that's where Cotton Classics is included.

So looking at the P&L for the entire year. Gross profit, 49%, which is compared to 49.4% last year. Looking like-for-like, again, we have actually improved the gross margin compared to 2024 since that would have been 50.1%, which we're really happy about.

External costs and personnel costs have increased by 6.9%. And again, it's -- they are affected by investments in the ERP system, but also other IT-related or investments. Like Goran mentioned, we have warehouse optimization and -- we -- in the fourth quarter, we also see some increase in legal expenses. It's not in general but specific areas, for example, that we finalized the -- we'll be working with finalizing the deal with the District of Justice Department in the U.S. and such.

Operating profit is SEK 1,141 million, which is a bit lower than last year and gross margin is for the year is 11.4% compared to 13% last year. Gross margin here, of course, at the year result also includes the SEK 66 million that we informed you about and took the cost for in Q3 regarding this DOJ matter with the previously forgiven PPP loans. So net result, SEK 783 million, which gives us a result for this year of SEK 5.90 per share.

A little bit about Cotton Classics. They've been included for 4 months in 2025 since we acquired them on September 1. And from mid-September, we introduced the first brands. In 2025, we introduced 5 brands, Printer, James Harvest, Cutter & Buck, Clique and Harvest & Frost. And as from 2026, we will also add part of Teamwear for Craft. We will also introduce some parts of Untagged Movement and also Projob. They will not have full collections, but part of it will be introduced.

So we are really happy with the start in Cotton Classics, who are included within the year sales of SEK 429 million and an operating result of about SEK 34 million.

And yes, and this is not sales, but the result per operating segment. Looking at the balance sheet, it's really strong. The equity ratio is 53%, well above our target. And again, also -- as well as the P&L, also the balance sheet, of course, is affected by the changes with currency with the negative translation effects, which affects, for example, the equity ratio actually by minus 2.5%. So it's quite big changes in currency this year.

Cash flow, same as in the quarter really, shows that we are investing quite heavily, but this also shows the investment in Q3 in Cotton Classics.

Looking at the share, we have just below 35,000 shareholders as of December. And earnings we mentioned is SEK 5.9 per share. And the Board has suggested a dividend of SEK 3 per share, which is compared to the year-end price, a dividend yield of 2.62%. This is the development of the share in the past 10 years. So we're still happy about that. But looking to the future, hoping for more.

So even though he's not here, we'll let Torsten summarize this with his comment that he is very optimistic about the future. We are stronger than ever and have managed to maintain profitability despite an exceptional volatile period, a challenging market and high level of investment. That very much summarizes this year-end closing. Thank you.

Thank you. Any questions?

Nicklas Skogman, Nordea. A couple of questions from me, please. Maybe we can start off where we ended on the high level of investments. Where do you see 2026 compared to '25 in terms of investments in both systems and sales force and marketing, et cetera?

Yes. Regarding the system, I think Torsten mentioned it already last quarter that we see that we will continue to invest in IT through 2026. We have been investing in a model, a template for the group, but it needs adjustment in each country where we come. So -- and like I mentioned in the beginning, we take this -- the greatest part of this would put directly in the P&L. So through 2026, we still expect to have additional costs regarding IT.

So higher next year or just additional cost?

No. Additional in regard to what's normal, but we have had additional the entire year. So it's -- I think the level will stay with IT cost through 2026.

Okay. And the other parameters there, marketing and sales force, et cetera?

Of course, those are more guided of what we see that we think is profitable at the time. So it's harder. But the legal advice was specific for this year. So that's not anything that we plan for next year and specific areas like the PPP loans, for example. So we expect those to be lower.

Yes. great. And then on the -- I think the growth in the Sports & Leisure division was the big positive surprise in this report, at least for me. What did you see -- I estimate almost, I think, 12% organic growth. You can correct me if I'm wrong, but what do you see driving this growth in this quarter specifically?

In the third -- fourth quarter, sorry, we can see, I mentioned both Cutter & Buck and Craft doing really well. Good sales, good margin. So they've done -- I think they are driving it in Sports & Leisure.

We can also say that the sports retail was quite bad also during Q4. But our sports brand were quite good in the teams, cross team were developing very, very good, not connected in that way to the sports retail. So I would say that the main factor that we increased quite good in sport was due to Craft Teamwear and also Cutter & Buck.

Yes.

Okay. Perfect. But then I mean, the profitability in that division was down a lot. So what's going on there then?

It's partly it's the investments. We took some marketing costs, and that was mostly in Sports & Leisure in the quarter.

Okay. So did you have any negative impact from tariffs in the quarter?

It's really hard to say exactly what the effects from tariffs are, but I'd say not that we haven't had any negative impact at the P&L for 2025. Prices were increased in June. So we could take up the prices. And that has very much faced the incremental tariffs that we have had. So altogether, we don't think that has had an impact.

Okay. Great. And then the last one, just looking at your markets generally for all segments, do you see any changes in the last couple of months or so?

He's nodding or shaking. What we could say is that we think that the fourth quarter is -- gave us some positive feelings. It's always hard to tell what that will bring us in the future. But looking at the last quarter, we saw some positive signals. For example, like we mentioned Craft and Cutter & Buck, had really good sale.

Alice Beer, ABG here. Just a quick follow-up on the margin in the Sports & Leisure sort of segment. The margin hasn't been great all year. Could you talk a bit about the dynamics there and what needs to happen for that to change going forward?

The gross margin or...

The EBIT margin in the Sports & Leisure?

EBIT margin. Well, it's been a tough market. You all know, especially in retail. So I think today, if you look in Sweden, all big chains have had some kind of reconstruction or like. So of course, it's been tough. Again, that's why we are happy to see that the fourth quarter and especially for us, we see that our competition -- competitors, they have even lost sales, and we are actually growing both reported and organically. So we're quite happy about that. But it is a tough market, of course.

So we're happy to -- we spoke about our business model. And what we see now is that it gives us strength, having these different channels where we can offer our products to more customers in more ways. And also, like Goran mentioned, Teamwear, not being as sensitive for market changes since you're going to let your kids do sport. You take away many things before you take away that. So that's why we think we've seen positive trends for our sake.

Okay. Great. Just a couple more for me then. Unemployment rates have been very high in the quarter, and they've grown year-over-year. But still, I mean, 16% promo growth, it's quite impressive given that. Could you just speak a bit about the demand in the promo channel? What's the appetite like there?

Yes. Of course, that is including the acquisition of Cotton Classics. It's in the promo, but it's good to see. We're happy to see because we've been discussing this that unemployment rate is tough for the promo, of course. But we've been successful. And we see that there is different demands like for -- in U.S. the promo business with the embroidery and everything is also in sporting areas and events, and there are many different -- not only companies and company names. So yes, we're happy about the growth in promo.

Okay. Great. And then just about Cotton Classics, have you learned anything in the quarter that might change your view on how long it will take to get the margins up there? And also, just could you remind us of the EBIT seasonality in Cotton Classics?

Well, we have only had them for 4 months. So we're still learning. And I think to be honest, I'd guess these are the 4 best months of the year that we've had the honor to include Cotton Classics in our group. We are learning consistently, and we are very happy to -- only 4 months into owning them, we have already introduced 5 brands, which have been very well received and are introducing more brands. So yes, if we've learned something from that, maybe we learned more from the B2C, which make us faster this time. I'd say, what you've been around longer. Do you have a comment?

Yes. We can say that what we learned from B2C, it's the same thing with the Cotton Classics, and we see that they really are the same. So we can use the knowledge that we have received from B2C also in Cotton Classics. And we also learned from B2C that it takes a bit longer time to get the turnover on our own brands through their customer base than what we thought when we acquired B2C. And that's the same thing here. But as Anna mentioned, it's been very well taken by the customers. And the cooperation with the management and the old owner is really working well. So yes, we are confident that we will have a good development there.

Just a final one then. Inventories were up in the quarter. Should we view that as you're expecting higher demand? Or are you just preparing to fill up the new warehouses?

Both really. We are expecting higher demand, and we have learned that having the stock is the key to getting the sales. For example, now Cutter & Buck has done really well, and they were really -- they built up the inventories, which is one of the key success factors to giving them this growth in the fourth quarter or during the entire year 2025, actually. So -- but also, of course, having new stocks, we are setting up also the brands that need to go to Cotton Classics for our brands and setting Ireland, Goran mentioned France. So a combination really.

I can also comment here that it's a bit -- quite many inbound deliveries are at the end of the year. And how much comes in December and how much comes in January could be -- so I think this year, it was a bit more in December than it was last year that came a week later in January instead. So that also affects.

Any more questions?

We have some from the YouTube audience.

Yes. No tricky ones now.

Well, I guess, yes. Can you please provide more detailed seasonal variations for Cotton Classics? I think I recall you said in Q3 that the result would have been negative if they have been consolidated from January. What should we expect now going on to [ Q2 ] from quarter-to-quarter?

We don't have that data, so we cannot elaborate in detail. But of course, if you look at the market in general, the way promo works, the first quarter is generally a tougher one and the fourth, a better one. So we expect Cotton Classics to follow the same pattern.

Yes. Can you give more color on the improved organic growth and discuss the demand since both in promo and in retail? What does that mean for the 2026 outlook?

How do we color the organic growth? Organic growth is color. No, it's -- we're, of course, very happy to have organic growth and that we show it in all areas. We have increased the inventory, which, of course, is a sign that we are expecting, not only hoping, but -- or maybe both hoping and expecting for continuously good sales in 2026.

Yes. What's the reason for the decrease of the dividend?

Actually, we have this dividend policy of 40% of the result over a cycle. And this year, we're just sticking to the policy really. And this year, looking at the result, of course, we had an additional cost for the PPP loans. We've been doing a lot of investments. And we also believe we do a lot of good things with the cash within the company. So -- but sticking to the policy really.

Thank you. Have you seen some effect during the second -- first quarter or even the quarter we just experienced with, consider the cold in the Europe -- in the Nordic due to winter weather.

Yes, we'll be freezing every morning. No, of course, that came after the year-end. So we don't give any forecast information, but it's not hard to guess that we have had better sales in winter clothing in the beginning of 2026 than we had in '25.

I understand. Can you also tell us how you -- a little bit more to understand the view of the operational expenses in 2026, including certain temporary high costs for ERP, automation, IT and marketing?

Yes. The ERP is easier because we are -- we do know that we are going to go in -- we are launching -- we launched France January 14. We're launching U.S. during spring in second quarter. And we're also launching in Belgium, the [ Texas ] companies. So we do have ERP costs going through 2026. That's for sure. Marketing, of course, is more to a situation, we can choose if it's good, we're going to have the cost or if it's not good, we're not going to have it. So that's more -- we have to see what happens in the market.

How is the Cotton Classics acquisition split across the segments as in how much is in Corporate and how much in Sports?

Everything is in Corporate. That was an easy one.

Investments for future growth has been high in 2025 and the operating margin continued down. What can we expect in terms of cost level in full year 2026 relative to 2025?

We don't give any forecast, of course. But again, Cotton Classics will be included for an entire year. That will have an effect, of course, but also on sales. So -- and regarding ERP, I think we have additional extra costs like we mentioned, and that's probably going to stay about the same through '26. But apart from that, it's more from what happens in the market.

And a follow-up question on the first one. How will the focus on -- will the focus improving the operating margin -- will there be more focus on improving the operating margin ahead?

Yes. I think that's the long-term goal, of course. I'm happy to see that, that doesn't make us scared to make short-term decision or long-term decision that have short-term impact like these investments have had. We do them, of course, for a good reason that we see future growth, future profit, future increase in the EBIT margin. So looking at a really short period of time, it might have a negative impact, of course. But we -- for the long run, this is actually -- we're, of course, looking to improve the margin by doing this.

IT investments alone impacting this quarter's result by approximately SEK 32 million. Could you provide some guidance on when we can expect these investment levels to normalize?

Actually, SEK 32 million is external expenses. So including the personnel costs, it's even SEK 35 million. We are -- as mentioned earlier, we are expecting to have -- the fourth quarter, I need to mention was extra high on this IT cost, but we are expecting to have, like we mentioned earlier, additional costs for IT through 2026, especially in maybe the first 3 quarters, but let's say, 2026.

Okay. A question about the CapEx. CapEx level Q4 was high. How does this look for 2026?

The CapEx included also apart from automization because the CapEx doesn't include the ERP, as we mentioned earlier, it's in the -- it's not in there. So it's -- Goran mentioned, we have a new facility in Poland that affected quite a lot in Q4. We also have started to build the fulfillment center in Dallas, almost SEK 30 million and almost SEK 100 million for Poland. So those are -- of course, we have also a new facility in Holland or in the Netherlands, as it's called now, which were -- the premiere was in November. So we have -- and also like Goran again mentioned, France. So yes, lots of investments.

How do you view the current inventory levels looking at your growth ambitions for next year -- for this year, 2026?

If Torsten would have been here, he always thinks they are too low. So no, like we said earlier, it's -- the level of the inventory is meant to reflect what we are expecting and what we want to sell. So what's the question again, sorry?

How do you view levels looking on the current inventory levels for your -- how does that affect your growth ambitions for 2026?

Hopefully, we have the inventory that will help us grow. It's a key for growth to have the inventory. That's the line of business that we have. Having the inventory is the way we can serve our customers, and it's a service we are paid for. So...

Is the ERP system delivering as promised in countries where it has been operational?

Actually, it's only operational in one country yet. So -- and it's been all well.

Two.

Yes. And after year-end, it's another country. We also -- of course, we don't only do the ERP when we are doing things, we also improve on our warehouse management system and in both Holland and in France, which we went live here 2 weeks ago. They have a new automization system called HAI Robotics, which is implemented at the same time. But so far, it works really well. So it's going to be even better the more when we get all the companies, of course, in the same system because then we're going to really see the use of being in this new system. But it's been really good. So far, so good.

Yes. We're nearing on our last questions here. Seeing Craft Teamwear growing, is that negative for Sports & Leisure margin at the moment given investments in the U.S.?

Teamwear, say it again.

Seeing the Craft Teamwear is growing. Is that negative for Sports & Leisure margin at the moment?

No. The Sports & Leisure margin is doing well, and the gross margin is up as well.

And the follow-up question is from the same guy here is, can you give us some more details on the development in Teamwear U.S. and in Germany?

We don't give as much specific, but we -- as we mentioned -- have mentioned earlier, Teamwear in the U.S. is quite in its birth, but it's in the beginning. So it takes time to process a market like that to gain -- open all the doors, but they -- they're working on getting new clients. It's only about plus 1 year ago, we had only one client. Now we have many clients, which then are working on their clients. So it takes time, but so far, it's positive.

Thank you. Can you -- and this is the last question. Can you give any hint about the development for Tenson Q4 and ahead of 2026?

Yes, hints we gave. Tenson was -- I think the expectation of Tenson has been quite high, and we've been hoping for this to come sooner, but we now see -- even though we still think we should be bigger by now, we see growth in the fourth quarter, both in retail and in corporate for promo. And we are really looking forward into 2026 to hopefully see some more growth within -- also within promo. Tenson is going to be launched in the U.S. as well. So yes, positive ending for Tenson in 2025.

And that was all the questions. I leave the microphones to you for final remarks, both of you.

Thank you. Yes, as mentioned, we think that we made a quite good year last year, both margin-wise with the gross margin and especially the turnover. And we think that we have a good base for continuing to take market shares. We invested more in marketing activities and took marketing costs on the corporate side last year because we saw the opportunity to take market share, and that we've been successful with, and we will gain very much from that in the coming years. Thank you for your interest, and thank you for coming.

Very, very welcome to the presentation of Q3 and to this day that we hopefully will spend together all of us.

If we start with Q3, I'm quite happy with the quarter, or you can say I'm actually happy with all points, excluding the one-off cost we had in the U.S. But otherwise, the growth is up to 8.3% if you combine organic with acquired in local currencies, I should say, because in the whole P&L, the currency effect quite a lot on all lines. So we have come closer to the minimum of 10% again that we want to have in growth.

Here is really nothing new. The number of employees will increase the coming quarter due to Cotton Classic that are -- if I understood correct, Anna, is in this figure with 1 12 part of the employees there. So that will increase. We are out in 25 countries now and the segments you know.

Yes, nothing have changed here. I think I recognize most of you, so I think you are familiar with those 3 different segments. The only thing the big change is actually under Corporate, where you now have done since 1st of September, Cotton Classic in. But the external brands they are selling, we will not take up as a brand here, and they have started to sell our, and I will come back to that in the afternoon.

Yes. On the 1st of September, we consolidated Cotton Classic, which is very, very nice. We have that as a point in the afternoon, so I will not talk much about that in this presentation. We had one-off costs for the COVID loans in the U.S. that are taken in Q3, and we also announced it before the report a couple of weeks before. I don't remember the exact date. And the currency continue to have negative reflections for us. I think that it will be more stable, but no one knows.

Quarter in brief, 8.3% sales increase and including currencies -- in local currencies and including the -- I thought it was closed, sorry. But in SEK, it's 4.2% then. Promo channel was very, very strong, I would say, with 7.2%. Retail was much weaker. And you can say the spread we have between those 2 distribution channels, I'm very, very happy with because if we were only depending today on retail, it would be a very, very tough situation. In general, I was quite disappointed when they released, for example, the Swedish Sport Index for the third quarter. If I remember correctly, it was first 13 quarters in a row that were negative. And then Q1, Q2 was a little bit up. And I hope that, that was a real change. But now Q3 came out with a small minus again. So I'm very, very happy for the Promo channel.

And also if we see on a certain brand, like Craft, if we're only depending today on selling out from shop and didn't have Teamwear. Corporate, it would be a very, very tough situation because the market on consumers is tough all over Europe actually. And it's a little bit hard to understand for me because now people have started -- consumers have started to have more money again, but obviously, they don't spend them. And I talked to a lot of operators for restaurants, and they have the same tendency even in Stockholm, where the restaurants actually are quite full. People spend less. They buy more cheaper wines or 2 glass of wine instead of 1 bottle and so on. And it's a bit strange. The only segment that's really doing well in retail today is the low-price segment. But it's a good combination.

All regions are continue to grow in local currencies. Operating profit, if we exclude this one-off in the U.S. on SEK 66 million, it was just above last year, which I think is very, very strong actually because we have a very high pace of investments in automatization and systems and also new markets now. So that could have been actually much, much worse. Also, I think we should point out an extremely strong gross margin. So you can say we don't use discounts and such things to hold up the sales. And that's also very, very nice. And this comes down in operating profit then after one-off on SEK 253 million.

Yes, sales, SEK 2.390 billion. I hope we soon can have a first quarter over SEK 3 billion. Sales, plus 3.6% and organic, we have talked about. And I think if retail becomes a little bit better or the situation in the sports retail, especially where which are the biggest retail channels for us, I think we can have and will have a very, very nice growth actually.

Corporate, net sales, we have talked about Sports & Leisure, also Gifts & Home was a little bit down. And this is then not in local currencies, I should say, because then it looks quite different. And geographical markets, North America continued to be the biggest one. What's happened there? North America is biggest. Sweden actually had a quite nice growth, which are a little bit surprising because we have very high market shares here now on most things.

Benelux, #3, and it's -- we have just taken Benelux out from the rest of Europe. And the Nordic regions, quite flat or flat. Rest of Europe is up. And there, of course, in rest of Europe, Cotton Classic comes in nowadays. And we will look at that for not next year, but the year after because now all Cotton Classic sales going into -- I think it is -- is everything going into Austria, Anna?

Yes, the rest of Europe.

Yes. So -- and there, we should divide if we can, when we have had it for a year, the different markets. Gross margin, I mentioned, I think it's a very strong margin. It actually surprised me a little bit as well. And that also, I think, show our position on the market because with this weak market, a lot of companies discounting extra and so on, and we can actually continue to grow with full gross margin. And the quarter on 51.1, I think is -- I'm not 100% sure of what I say now, but I think it's the highest ever actually. So that's very, very nice.

External cost increase. We have -- we will start to increase the IT costs again from at least 2027, I would say. And the reason that the IT cost increase is that we just right now pay actually for 2 systems, the old one and the new one. So it's not so much we can do about it. Operating profit, SEK 253 million, and the contribution from Cotton Classic was SEK 14 million this quarter.

Here's the operating segments. And it's not so much to comment, I think. Of course, they are affected then very much on Sports & Leisure on the one-off costs and also a little bit actually on Gifts & Home because it's all related, of course, to the U.S. entities. Cash flow, operating minus SEK 249 million, and that's planned. So that's nothing that worry us at all. It's both that we increased stocks and the new investments and launch we are doing with Teamwear in U.S.

We also opened up now in a new warehouse in Ireland outside Dublin in January. And we also launched a new concept in Corporate and merchandising called Untagged Movement, where the launch actually was this week, first at an exhibition in Germany, Germany and Belgium. And then it should be rolled out in all countries in January, all European countries, I should say.

For 9 months, Sales increased by 2.6% and Promo up 5%. I also wrote in the report that it's -- I hope that we have the toughest time behind us on Corporate because the growth has been better and better. And also, we today meet much more positive clients, and clients are more active today than they were a year ago. Then we can say it's very hard to predict because what is good today can be bad tomorrow because of what's happened around in the world, and it's still very unstable. But hopefully, it's a trend.

And per operating segment, it looks like this. And the geographical areas. And now this is in SEK. So for example, North America is much, much better in local currencies. And that's a little bit surprising for me that U.S. is still -- I wouldn't describe it as strong, but it's much more stable on the market than I expected with all those things that has been and you wake up one morning and it should be 100% duty on China, next day, it's 50% and the third day, it's -- they delay it. And yes, it's a total mess actually. So I'm surprised that the market there are as strong as it is.

Gross margin also, yes, 0.1% higher than last year if we look at the 9-month period. And the rest is more or less the same comment as it's on the third quarter. And operating segments, operating profit on different segments. And here, you can say I'm -- I would be quite happy with all segments, except Gifts & Home Furnishing if it was not for the SEK 66 million in the U.S. then.

Still a very strong balance sheet after consolidation of Cotton Classic, we still have 52% equity. So we can continue growing both by more acquisitions if we find the right ones. And also, of course, we want to speed up the organic growth with the new investments, with the new warehouses and also with a lot of new products. We have I think I can say that we haven't had so much new products launched in many, many years. I think last time we had so much new was actually when we launched Craft Teamwear. So we have a very good pipeline on products.

Cash flow, it's not so much to comment. Rolling 12 months, we are on SEK 9.7 billion in sales. I -- we would have been over SEK 10 billion if we had the same currency in the past, but I hope still we can go over SEK 10 billion very soon in the rolling. Gross margin good. Costs, we have talked about. Operating margin, 12.1%, which I'm, of course, not happy with. But I think we -- if we can be between 12% and 15% until we are coming down a little bit in investments, I think it's still very good. And I think we then have a very, very strong position to actually start climbing up against our goal that of 20. Yes.

Yes. That's more or less what I had to say. And then we can open up for questions, if you have any.

Magnus Roman, [ SPF ] Markets. Yes. First, I'd like to ask about the underlying gross margin being so strong. I think you said it's a record. I think looking back at Q3, it is. If you look at absolute quarters, you have had a better Q4. But how would you describe the main drivers here behind the strong gross margin? I mean you mentioned that you have not been discounting, but can you help us understand the viability of this?

A little bit is the product mix and that we grow, for example, in Craft Teamwear, where we have good gross margins. One part this quarter is also that the trading was less, which is what we operate with the lowest margin in the group. But then also, I think we have a very, very strong position, and we have had a strong service for a long time now. So I would say on the market, we have an extremely good reputation. We gain clients, very few or no one leave us. And we don't need to use the prices and argument as it is now.

So it's a totally different situation that we had, for example, 12, 13 years ago when we had [ taken ] down the stocks and couldn't service the client and clients left us. And if you want to keep them, you have to give them extra support and discounts and so on. So I feel quite confident that we will continue with a high gross margin, and maybe not on this level because another quarter, the trading can come up, for example, and then it goes down a bit. But on the main business, I think we can continue to have a very good gross margin. And we should also remember that Cotton Classic operate on around 25% that take the gross margin down also not so much in Q3 because it was only 1 month in the figures. But -- so if you include that as well, I think Q3 was very, very good.

Yes. And speaking of which, you mentioned that we will speak more about Cotton Classics later, but one -- can't help just to ask one quick question here on the EBIT of September. Is there anything you would like to highlight to make us not too enthusiastic because if we analyze this EBIT, we might get very enthusiastic about the prospects here.

I'm enthusiastic. No, it's -- again, I mean, I have -- if you exclude -- and I think I said that also after Q2, if you exclude the first 6 months of the pandemic and the last quarter and the first 2 quarters of '08, '09, I think this is the absolutely most difficult situation to navigate in with the different wars, Ukraine, Gaza, now also Sudan. You have Trump where we don't know sometimes from week to week what duty we will pay in the U.S., depending on country, of course. So it's -- I mean, right now, I'm feeling quite optimistic and it looks better, but that can be changed on Monday. So it's a very tricky situation. So I think that a bigger turnaround in the market, in general, we will not have before we have a more stable situation.

And you mentioned the tariff and we might hear more about that in the presentation later perhaps. But can you -- do you know or can acknowledge if you expense the cost of the tariff at the point of sale of that good that you brought in that was tariff or if it is already at the point of purchase?

The problem is -- now it's going into the purchase, of course. And then I don't know, I think...

So when we will see the gross margin -- negative gross margin effect essentially if it is at the point of sale of these goods. I believe in the case of H&M, for example, they have warned off later into this year that we will see increasing negative effects due to that effect.

Sometimes, sometimes not. And it depends on if the goods are already sold when it's shipped, which is a minor part. Otherwise, we also adjust the selling prices. I mean, if they increase tariffs from 20% to 100%, we can't absorb that. But as it is now, I would say we had a few millions, I think, in extra costs in Q2. Q3, I actually don't know the figure. I don't know if you have any figure on that, Anna?

[indiscernible].

I said I think the result was directly affected with some millions due to tariffs in Q2. But I don't know about Q3, if we had anything there.

The result is affected in many ways. It's a bit tricky to navigate because it's both in cost and also increases in price. But for example, I know that since May, going forward, [indiscernible], for example, has had $3 million additional tariffs. But that is not in the P&L because it's a net effect in the P&L so far.

But you can at least say, I can add that I'm extremely happy that we start moving a lot of production already last period to mainly Africa because if we should be stuck totally in China now, then it would be a huge problem.

Any other questions? In that case, we have some questions that have been sent to us. Cotton Classic contributing with 14% profit margin in Q3, still see 5%...

Sorry, SEK 14 million, if I remember correct, not 14%.

All right, SEK 14 million in Q3. Still see 5% as a good level for 12 months period. There's no question mark there. So I don't really know...

Yes, you can say that September, they had a very good month. Of course, we hope that continue. But I think that -- still that it will take some years even if we have been much, much faster with those with B2C before we get them up. So if they can do like 5%, 6%, 7%, I think it's good. We should also remember that they are a typical company that look as New Wave did in the past when we only have Corporate.

So September, October, November is very strong months. If we were consolidated them 1st of January, they will have contributed with a big loss because generally, they have all the marketing costs and low seasonal sales. So it's also a question on timing and that we should change their operating margin very, very fast that I don't believe in. Maybe we can climb 2%, 3% a year with the start from half year or something because I don't want to answer more now because then it's not interesting enough.

Maybe you already answered this, but how did FX and tariffs impact gross income and EBIT in the quarter?

We don't -- I don't know exactly, but you maybe can repeat, Anna.

I didn't hear the question.

Yes. Maybe you should move so you're here.

How did FX and tariff impact gross income and EBIT in the quarter?

We don't have the figure. We released how the revenue is affected.

Another one here as well. You have improved the result for Gifts & Home Furnishings. What have you done there in connection with the business in Kosta? What do you need to do to improve more?

Yes. It's a long list, I can say. But I think there is maybe the area that we are most affected, excluding retailing maybe in Craft because there we're really depending on the consumers. And there, we can also -- I didn't refer to Kosta before when I talked about restaurants. But for example, in August, we were in -- have record visitors, but we didn't have record sales. So people spend less and so on. So we need a general turnaround a little bit.

And then, of course, we have a lot of things we are doing in the companies, everything from product development to of course, try to improve the operations. But that has also been a very tough market. It was very much up during the pandemic when everybody was working from home, they spend a lot of money in these categories, and that we paid back after.

But it's a tough job. And you can also say that we, as management, have 2 options, try to do what -- try to put our time into the companies that are doing already good and improve them to be even better or spend a lot of time trying to improve quite little down there. And now I must say we have worked more than improving with improving the already good business. And also, of course, the integration of Cotton Classic can take quite a lot of time for finance, but also for me regarding products and marketing and so on.

Thank you. Any more questions in here?

Andreas Lundberg with SEB. You talked a lot about inventory, but receivables were up quite a bit. Could you talk about the general dynamics of your receivables and whether that was an effect of strong September sales?

I think it's 2 effects there. One is that September was strong. The second one, help me if I'm wrong, Anna, was that we took in Cotton Classic. So when they get consolidated, we get 100% of their receivables into our balance sheet, of course. So I think it's those 2 things.

And I don't know how much the contribution -- do you want to fill in, Anna?

You're completely correct.

And because I think the average time we get paid on have not increased a lot. So...

But the strong sale at the end of September is, of course, affecting.

Cool. And then maybe a general question on competitive behavior. You experienced big difficulties during the financial crisis basically. Are you seeing a sort of similar behavior among today's competitors that cannot afford or have the guts to keep inventory or...

Not as it was 2009. But you see in some cases that they have less good service. So it's a little bit in that direction, but not at all that it was '09. I mean then everybody or a lot was panicking at the same time. And I think our Chairman, Olof described it quite good because he said it's not a crise anywhere, but it's like a wet blanket over everything. So it's not as bad as it was then, but it's -- we see some tendencies.

But do you think it relates to uncertainty, financial situations or knowledge or what have you.

But I think it's uncertain, definitely. It's not my opinion, I can be wrong, of course, but it's not the financial situation. And I mean, if you look at -- we have a lot of -- I think you know this better than me, but I guess, for example, that people are still saving much more money in the past. I'm just guessing because it's not that they don't have the money. And you can say that some segments are still doing quite well. And low price, as we said before, is fantastic. But that, for me, means that people spend maybe not -- yes, they are more careful on what they spend on also. But I think it is uncertainty. And I think now it will be very interesting to see what's happened in the U.S. after the elections that was in New York and some other places. But we need a more stable world.

Okay. Then I say thank you very much for listening in, and then I should leave to Stefan and [indiscernible]. Thank you.