I am pleased with the profitability improvements in the Nordics and the fact that our Group gross margin has improved year-over-year for the fifth consecutive quarter. While we continue to make solid progress in consumer sales, margin improvements, and cash generation, we remain challenged by historically low market volumes in the project segments.

Organic net sales for the Group declined by -6% with flat sales in the Nordics and a decline of -12% in the UK. On a like-for-like basis, adjusted for last year's store closures, sales in the UK declined -3%. The growing number of store visits and kitchen design appointments continues to support the positive development in the consumer segment. Conversely, the low activity in residential property developments continues to burden demand and growth in the project segment across all markets, with double-digit volume declines in Finland, Norway and the UK.

The adjusted gross margin for the Group improved to 38.6% (37.3), driven by higher average order values, solid supply chain productivity and a favorable segment mix. SG&A savings totaled approximately SEK 70m, largely driven by last years' cost reduction programs and sustained strong cost discipline across all areas. Our accumulated savings since the beginning of 2023 have now exceeded SEK 550m.

Group adjusted operating profit increased to SEK 16m (-27) on the back of the solid performance in the Nordic region. The large improvements in cash generation continues, which resulted in a cash flow from operating activities of SEK 28m (-258).

Adjusted operating profit in the Nordic region increased to SEK 109m (23) and the adjusted operating profit margin rose to 7.5% (1.6). Volumes in the project market continued to decline, however with an abating trend. Consumer sales continue to trend well, fully compensating for the project volume decline. We are especially pleased with the performance in Denmark. The Nordic supply chain delivered another good quarter in terms of dispatch and productivity.

The ramp-up in Jönköping continues to progress well. The manufacturing of kitchen components and assembled cabinets is gradually increasing as planned. We now enter an important period when we plan to dispatch complete Marbodal kitchens - including all accessories - directly to end customers from Jönköping.

Net sales in the UK declined -12%, driven by a large volume decline in the project segment, while Magnet consumer sales volume continued to grow. Gross margin improved to 41.3% (40.9) driven by growth in consumer sales, while the supply chain remains burdened by volume underabsorption. Cost savings in the quarter were offset by marketing spend to drive order intake during the important winter period.

Operating profit in the UK amounted to SEK -53m (-11). While we safeguard the positive momentum in consumer sales, we will continue the transition to an asset light operating model and realize savings from executed cost reductions and store closures.

We estimate that the consumer markets will continue its recovery, while the project market is likely to remain subdued for the remainder of 2025. While recent changes in international trade policies do not currently have a direct impact on Nobia, their indirect effects - particularly in relation to interest rates, inflation, and broader macroeconomic dynamics - remain uncertain.

Regardless of the market uncertainty, we remain confident in our strategic priorities going forward; to ramp-up the new Nordic factory in Jönköping, to continue the turnaround of the UK operations and deliver on our cost reduction initiatives.

Kristoffer Ljungfelt
President & CEO