Good morning, everyone, and welcome to Lumi Gruppen's Presentation Of The First Half 2025 Results. First of all, we are sorry for the delay. We had some technical issues, but hopefully now we are ready to present. I am Martin Prytz, CFO of Lumi Gruppen, and I'm pleased to be joined today by our CEO, Nina Vesterby. It's great to have you with us as we share the latest on our performance. We've seen important developments over the past six months and during the academic year of 2024/2025, both financially and operationally. Today's presentation will give you a view of our progress. We'll highlight some of the factors behind our performance, the steps we're taking to strengthen our position, and how we're setting the stage for the next academic year and beyond. On the agenda, we'll start with the financials, where I'll take you through the group's results, including the performance of each of our segments, with comments on key drivers. We've also included some financials for the academic year. Both the report and the presentation, as the first half of 2025 is closely linked to the second half of 2024, and in some cases, this provides a better overview of Lumi 's performance. For your reference, we have not been allowed to change our financial year, so the academic year is presented as an APM. Nina will then walk you through the business update and outlook, including operational highlights, market dynamics, and our key growth initiatives. This will also cover the status of the intake for the 2025/2026 academic year, but please keep in mind that we still have some important sales weeks left, so it's too early to draw final conclusions. Finally, we'll wrap up with a Q&A session to address any questions you may have, and we are also available for one-to-one meetings later today or over the coming days. Before we start, our key message for the first half of 2025 is that the positive momentum continues. We see growth in revenues, growth in adjusted and reported EBIT, continued strong performance for Oslo Nye Høyskole. We see Sonans returning to growth, and we also did one acquisition in the first half of Realfagshjelpen, that we will come back to later in the presentation. Let's start with the financials. Revenue grew by 11% in the first half of 2025, and 12% for the 2024/2025 academic year. ONH was the main driver, with growth of 60% in the first half. As in previous periods, this was driven by continued expansion in new and existing online programs, together with a higher nominal share of recurring revenue. In addition, a favorable market trend in online university college programs has likely contributed to increased market share for ONH. For Sonans, revenue grew by nearly 5%, indicating, as we saw in the second half as well, that the market has stabilized after two academic years of decline. On the following graphs, we see how the buildup of the revenue was in the first half to start with, from NOK 230 million to NOK 236 million, with ONH contributing by NOK 19 million and Sonans by NOK 4 million. If we look at the academic year, the full academic year, we see that the growth went from NOK 423 million to NOK 475 million, where ONH contributed by NOK 42 million and Sonans by NOK 9 million. On the EBIT, adjusted EBIT for the first half came in at NOK 36.2 million, up close to 31% from last year. The margin was 15.3%, which reflects a margin improvement of 2.3 percentage points. For the academic year, adjusted EBIT was up 43% to NOK 68.8 million, with a corresponding margin of 14.5%, which reflects an increase in margin of 3.1 percentage points. The improvement was driven by operating leverage on a largely fixed cost base, along with ongoing benefits from cost reduction programs. On the following slide, the graphs for the EBIT just summarize the key figures, with the EBIT for the first half of NOK 36.2 million, with a margin of 15.3%, and the growth in EBIT from NOK 48 million to NOK 68.8 million, with a corresponding margin of 14.5% and a 3.1 percentage point improvement in margin. Taking a bit closer look at the operating expenses, excluding depreciations and amortization for the period, adjusted operating expenses were NOK 175.3 million compared to NOK 162.2 million last year, an increase around 8%, largely due to an annual salary inflation of 5% to 2%. It's worth noticing that last year's Sonans results included a NOK 3.5 million gain from selling the 22/23 collection portfolio in the first half of 2024. This was a somewhat unusual gain, given that the provisions for bad debt under the expected credit loss model normally are closely aligned with the sales value. This was due to a more cautious approach, following a peak in unpaid invoices continuing into 2023. Adjusting for this, the underlying expense growth was around 6%, ending at NOK 171.8 million. As we can see on the graph, when we exclude the non-recurring expenses and the specific gain on the portfolio, we see that the payroll, as mentioned, is the key driver for the expenses in the period. Now moving on to ONH , adjusted EBIT rose by 21% to NOK 28.5 million in the first half, with a margin of 20%. When we exclude ONF, which is currently operating at a small loss, for reference, compared to previous numbers provided, the margin was 24.1%. When we look closer at the changes in the OpEx, the key items are higher personnel expenses, mainly due to inflation and somewhat more employees in ONH . There was an adjustment of the management fee by NOK 1.8 million. This is more accounting technical in nature, as we see that the group expenses remain quite stable in the first half, as you can observe in the segment noted in the report. On group level, the effect is close to neutral, while it has an impact on the expenses directly for the ONH segment. Lastly, we have higher depreciations from the new premises at Dalvangstuen for ONH . However, a part of it is a timing effect, as we started the depreciation when ONH moved into the building with the start of the contract. The first three months were rent-free, so on a traditional NGAAP basis, it would be representative saving for ONH . Just looking at the graph as well for ONH on the EBIT development, we see that there is, as I said, a strong revenue growth and a positive contribution margin increase as well, while the management fee and the depreciations are offsetting part of the growth in the contribution margin. Moving to Sonans, the adjusted EBIT was NOK 11.3 million with a margin of 12.1%. When adjusting for the collection portfolio gain, as I mentioned, and also for Sonans, the management fee changes, the adjusted EBIT, or so to say, the underlying EBIT was NOK 70.7 million with a corresponding margin of 19%. When we look closer at the OpEx for Sonans as well, and when we exclude the portfolio sale and also the management fee, we see that the actual expenses of the underlying operations fell by NOK 1.2 million. The management fee was adjusted upward by NOK 3.0 million. As I said, the group expenses remain stable, and this is more accounting technical in nature, how we allocate the expenses to the segments. Lastly, we see there's a positive continued development for the depreciations that is driven by the improvement in terms for leases and also subleasing and fewer campuses in total. When I look at the graph explaining the development in EBIT for Sonans as well, we see that there is a positive revenue growth combined with lower underlying operating expenses when we look at the OpEx and the DNA. However, we have the gain from last year that is partly offsetting this combined with the management fee. Underlying performance for Sonans is quite good. Now move on to operating cash flow. The operating cash flow fell to NOK 6.2 million in the first half, and this is mainly due to the delayed sale of the collection portfolio for Sonans. The sale of the 2024/2025 collection portfolio will take place during the second half of 2025. Net working capital was also in line with last year when we adjust for this delay in the sale of the collection portfolio. It's also worth mentioning that last year also benefited from a one-off marketing cost treatment when we changed the accounting method for marketing expenses last year. On the next slide, we can see the development in the net working capital, where we see the unusual position in the first half of 2023 that is related to the development in the receivables, where we had a peak in the first half of 2023 of NOK 54 million. We also see the provisioning following the development in the receivables as well. There's a clear correlation on the development of the accounts receivables and the timing of the collections portfolio sales for us as well. When we adjust for the collection portfolio sales planned to be completed in the second half of 2025, we see that the level is in line with previous years, but there's a sort of unusual situation in the first half of 2023, driven by the situation with the paid invoices for Sonans. On the cash position, also including the full year, look at the full picture of how it's developed. The cash position ended at NOK 45 million at the end of the first half, compared to NOK 65 million last year. There are a few items explaining the development. The first one is that we had the asset purchase of NOK 50.5 million of Ekko that took place in the second half of 2024. We had NOK 5 million in additional OpEx, sorry, in the second half as well for ONH new campuses that is not recurring. We had two debt repayments totaling NOK 15 million compared to one repayment in the previous year. Finally, as mentioned a couple of times, the collection portfolio sale that has been delayed represents a value of around NOK 14 million for Sonans and Lumi . With that, this concludes the financial part of the presentation today, Nina. I give the word to you.
Thank you. OK, so thanks, Martin, and hi to everyone watching. The school year 2024/2025 was a solid year for Lumi and has been the year we turned the corner. ONH , our biggest segment, continues with high growth and program expansion and also executed a successful move to a new premium campus. For Sonans, we finally see an increase in revenue and growth in margins. On top, ONF is up and running in a very interesting market. I think the hard work and the restructuring operations are paying off, and we expect continued improvements and growth going forward. I'm just going to spend a few minutes on our business outlook for the coming school year. Just as Martin said, we still have one month left of the intake in all business areas. What we present is based on the intake so far. Overall, we do see continued growth in all our business areas, but the intake is a bit slower than we have seen in the previous years on ONH at the same time. We still believe the fundamentals for the business have not changed. The political backdrop for private education is still favorable. We have a healthy demand gap, the same as last year, with 2.2. We see growth in flexible study programs in somewhere in NOKUT, and that underlines the fact that we're in a digital shift and that we're well positioned for the future of education. We did expect to launch more new programs this year, but we have pointed this out before. There are delays in NOKUT, and unfortunately, this leads to some timing issues for new programs. The softer growth can be seen in connection with those timing issues. We believe in more than 10% growth for ONH . For Sonans, we expect to continue to grow, underpinning the return of the market with growth two years in a row. We do not yet see a full recovery. For ONF, the number of programs launched is also a bit lower than expected, but the growth in our existing programs is high. In terms of accreditation, very important for us. We're waiting on feedback from NOKUT on institutional accreditation and still expect that process to be finished by February 2026. We have confidence that we have established a multidisciplinary university college in line with the demands for the institutional accreditation. This is, of course, plan A for us. We do have a lot of programs awaiting accreditation and believe the growth for next year is secured with new programs regardless of status under accreditation. Why is it important for us to get that accreditation? Getting it means that NOKUT is satisfied with our internal processes and quality control. When we can accredit ourselves, we can expand into new and relevant segments, for example, like technology. We can also change our existing programs to adapt to the markets. Overall, it will make ONH an even more relevant and innovative education provider. When it comes to vocational and ONF, they have not been able to launch new programs at the pace we were expecting. Because of this, we needed to restructure the business to operate with a sustainable financial trajectory. We expect to be near break even for ONF in the current school year after this restructuring. We have many accreditation programs first in line for NOKUT. We also see the extended focus on vocational from the government, and we're planning for strong growth for ONF in the future. Sonans has gone through some big changes with the rapid market decline in the previous years. With a strong management team for Sonans, we believe we will continue this journey of growing forward. Sonans revenue is growing at a steady pace. With our current restructuring of the product portfolio, offering premium products and focus on operational excellence, we expect to elevate our margins for the school year 2025/2026, regardless of a market recovery. Sonans is operating in a competitive online market, but our premium product and our high satisfaction lead to high growth for us in digital classroom and also online studies. Sonans acquired Realfagshjelpen just before summer. That's an asset tapping into the primary and upper secondary school markets and also privatized students that only look for one-to-one tutoring. We look forward to working with top students from top colleges in Norway in Realfagshjelpen. We are still confident that we will reach our financial ambitions towards 2026/2027. This includes high intake numbers for ONH , driven by a pipeline of expected accredited programs. We also expect continued growth in margins for Sonans and the continued growth for ONF. All of this is driven by the need for flexible education, a favorable political backdrop, and the work on operational excellence in all areas. With that, I will finish up with a recap of a few slides and most important messages from the Capital Markets Day we've had. For ONH , we do expect double-digit growth with our expected accreditations, our attractive programs, flexible learning models, and of course, the very satisfied students and our new campus, which is a great campus in Dalvangstuen. For ONF, we are now positioned for growth. We have many accreditations first in line. We have strong political support. We also work towards a lot of synergies with ONH going forward in administration. Sonans will return to normalized profitability with resilient and efficient operations. We have a very strong position and quality of product. We also hope for a partly recovery of the market going forward. We will continue to explore growth initiatives. That is both in terms of M&A, but also possible corporations. Organic growth is very important for us. Our financial ambitions, as we said, they're still the same as we've shown before. ONH at around 15% growth and EBIT somewhere between 25% and 30%. Sonans with around 5% growth and 15% EBIT. We see the establishment of ONF as a solid vocational school. We believe that we will have positive earnings for the coming years and high growth also in revenue. That concludes our presentation for today. I just want to show you the financial calendar going forward. We will come back with a date for a trading update after our final intake weeks. Thank you for listening. I think we will move into Q&A now.
All right. We can jump to the Q&A. The questions are now open. If you have some, you're pleased to submit those. I think we can start with one question, and that is on the autumn intake. I know we're still early days and still some weeks left, but how has the last part of the autumn intake typically developed for Lumi Gruppen?
That actually depends. Both for Sonans and ONH , that varies a lot. The last few weeks, it comes with a bit of uncertainty. What we do see for Sonans is that intake has sort of been a bit delayed for every year. For ONH , it's varied a lot over the last few years. It's difficult to see or to say exactly how the intake will be. We do hope it will be good.
OK, perfect. Understood. In the report, there was some deviation between the reported and the adjusted figures. Is it possible to maybe provide some colors on the main deviations?
Yeah, sure. I think we've added some details as well in the report. You can look into it. It's a couple of things. First of all, we've done the final kind of restructuring for Sonans related to closing the last campuses and also for establishing new lease agreements. That's part of it. As Nina mentioned as well, we've done a restructuring for ONF as well to make it more financially sustainable and being prepared for when the accreditations are received. We have certain expenses related to more strategic projects in the M&A space that is included in the expenses as well, in combination with certain professional fees as well for this. I think, as we write in the report, we have the kind of expectation to see a lower kind of size of non-recurring expenses that we see for the first half of 2025.
OK, perfect. Thank you. If you look at the short term, of course, still early days with the autumn intake. How do you expect the margin development to be into H2 and maybe the next coming academic year compared to the academic year we just closed and H1 2025?
Yeah, I think we should see kind of a continued improvement for both Sonans and ONH. ONH has done a lot of investments over the last year and should still continue to, with its growth, continue to be able to improve its margin. For Sonans, we have kind of a specific work going there as well. As we said, we have an ambition to come about the 15% or at least at the 15% EBIT margin for Sonans. I think that's a key target. That's something we are working on now to get in that position. Absolutely, Sonans should get back more on track on profitability in the area of 15%. I think also in the financial ambitions, we're targeting toward 25%, 30%. Our goal, of course, is to try to continue to improve the margin for the coming academic year and also then towards the 2026/2027 academic year as well.
OK, perfect. Is it possible to provide some color on the Realfagshjelpen acquisition? I know you did it during the presentation, but maybe a little bit more in depth about the company and maybe the strategic rationale of the acquisition?
I can provide at least a little more color. Realfagshjelpen, they're operating in a different market than we are. In upper secondary school and primary school, which is a market we believe will be important for the future, for us it's about entering that market. Today, we only have the one-to-many tutoring for Sonans' students, and now we can also offer one-to-one tutoring, which we believe many students want. We see the management of the company has high ambitions for the company. They've been growing over the last few years, and we want to take part of that growth. They're very tech-savvy, and that's important for us because we need to implement even more tech in our company. We might be able to learn a bit.
OK. Perfect. I think that concludes the Q&A. I'll leave the floor to you to conclude the presentation.
As I started, it's been a year where we turned the corner and are very happy with the year we've been through. I look forward to 2025 and 2026. As it looks now, we will continue the growth and continue the expectations to deliver on the expectations going forward. All in all, we are very happy with Lumi Gruppen at the moment.
Thank you all for joining the session today. As we said at the start of the meeting, please reach out to us if you'd like to have a one-to-one meeting or just email questions you may have later on. We're happy to meet or answer any emails. Have a nice day, everyone, and thanks.