SkiStar AB (publ) (SKISB) Q3 FY2026 Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to the SkiStar Interim Report Q3 1st of September 2025 to 31st of May 2026 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speakers today, Stefan Sjostrand, CEO; and Sara Uggelberg, CFO. Please go ahead.

Thank you for that introduction, and a warm welcome, everyone to this quarter presentation for Q3 '25-'26. So the agenda for today is that we will go through a bit of the third quarter performance. We will go through a financial update, and then, we will guide you through a bit of an outlook and a summary. So let's start with the Q3 performance. And before I just jump into the numbers, I just really would like to highlight again that we -- SkiStar is the market leader for the Scandinavian Mountain holidays. We are running 6 destinations in Sweden and Norway. We have a market share of 42%, and we are really proud of our integrated business model, where we have the digitalization as a driver and an enabler. And we're also really proud of our significant land bank for property development, and we will take you through that as well later on. So if we jump into the third quarter, we present net sales with a 5% increase. We have a lower operating profit with 8% decrease. And if we exclude the expectation gains, we can say we have a par result compared to last year, and our operating margin stays at 24% compared to 25% last year. And as we mentioned in the second quarter report, we had a very challenging booking situation in the end of the season. And that's why we also decided to go for a lot of activities, price campaigns, marketing activities, and unfortunately, that didn't pay off as we expected. So that's why we also -- that costed a bit on the margin since we lowered the prices, and it costed also a bit on the cost side with the marketing efforts. And we could also see that we had a decrease of skier days sold in the period as well. So if I summarize, you can say that we had a good growth in line with our financial goals, but we are not satisfied with the result, but we also have taken some actions going forward to secure that we can have a more stable result development also Q3 going forward. I would also like -- since we are summarizing the winter season, I would like also to talk a little bit about the accumulated results. And here, we can say that we have a 7% increase on top line. We have a 5% increase on the profit -- operating profit. And if we then compare without exploitation gains, we actually increased the result with 8%. And also, we deliver a very stable result here we must admit. And we increased the skier days with 0.5%; however, we have this hesitant real estate market. And we have said that since we have this hesitant real estate market, we also can see that we have had 0 income and profit from real estate market the first 9 months. And also the outlook for the real estate market isn't on top as it was in the good old days. So we are saying that we will most probably land on the same level as we did last year with the real estate gains. However, if I look into the first 9 months, we have increased in all revenue streams. And it's very -- it is actually still strong demand for Mountain Vacation, and we can see that we continue to increase the number of international guests. We have put a lot of effort in investments for this year. And we can see that we have an increased level of guest satisfaction and that helped us that growth in all revenue streams actually. And we will continue to invest in this, especially to secure a good customer experience development. So again, the international guests, they are a drive for us to increase the revenues and they now stand for 40% of the total bed occupancy rate. And the most important with international guests, I must say, is that they buy these long ski passes, 6 to 8 days, and they do it long time in advance. And they also book more, they book the full package, so to say, and they do it in a long time in advance, everything actually. And it's also very good that the peak weeks differs also from, you can say, the Swedish guest, which is, of course, good that we can filling out more weeks and work with the capacity in another way. And also, they are increasing over time as well. We're really proud that we have improved our guest experience this year. We have invested in better ski experiences. We have done that in wider slopes. We have done that in actually more snow gowns. We have done it in more lifts. We have invested in better accommodation experience, and we have taken a large help from AI as well. So when the customer had contacted us, we have really had a good help from AI and that has speeded up the answers to our guests, which has been very helpful. And we're also very proud that we have invested in the ski pass price differentiation. So that has helped a lot of customers to also choose other destinations and maybe or also destinations with more value for money ski passes. And we are really proud to have the lowest ski pass in the in the mountains actually to -- for our guests. And then, also more precise governance around the KPI, around NPS value, so we work very hard with that across the whole organization to secure that we continue to improve our guest experiences. I think sometimes we don't talk enough about our integrated business model because skistar.com is a fantastic engine because we own this distribution channel, and we are not dependent on any other distribution channel. And I think many others are jealous that we can own this distribution channel because this helps us with the diversified revenue streams. It helped us to have this dynamic pricing model. It helped us to have a lot of different guest interaction and also helped us to collect a lot of customer data, which has enabled us to be much more specific in our tailored sales. And this integrated business model also helped us to improve and also expanding our customer offer to define and find new revenue streams. And this is 1 example. And this is taken from our development of our retail business. And we have had a very solid development of the retail business. We have a CAGR of 11% since '18, '19. And the last couple of years, the development has been really significantly strong and is specifically with our own brand equipment with the last quarter grown 30% actually. So really, really strong development of a quick brand. We also have this significant land bank, and the land bank enable us to have an organic growth within our company because we can both continue to develop ski areas, and we can also continue to strengthening the destinations' ecosystem. And by doing that, that would also help us to develop the whole destination in a way where we control the development more or less. And we can also develop the destinations in areas where we really want to stare the guest flow, so to say, since we have this control of the also ski areas. And by -- to have the integrated real estate development model, we can also create value through the property development, and it also drives growth. This year, we opened up new beds in the next fiscal year -- sorry, '26-'27, we open up 600 new beds in Sälen, where we have seen a potential to grow with more beds as an example. And that is helping us to grow with own beds, and we do it with warm beds, and we do it in the integrated ecosystem, which is, of course, very strong within our business model. And we continue to enhancing capacity and guest experience. This year, we had this investment in the Trysil. We had the new ski area in . We have lighting projects, and we continue to invest to really secure that we're enhancing the guest experience among our destinations. So I think we are proud of this, and we continue to be forward leaning in all these actions. And Sara, I hand over to you to talk a little bit about the financials now.

Thank you, Stefan. If we start with the net sales development, it has been fairly good. And the stats show that the net sales development last 12 months that amounts to 7.3%. The Q3 -- net sales Q3 was 5%, and accommodated Q3 was 7%. And of course, as Stefan mentioned, the net sales development during the third quarter has been not slow, but a bit less than expected. And if we continue with explanation on net sales development, so in total, if we exclude effects from currency, the revenue growth was 8% in comparison with last year. And we have had increase in all our revenue streams. So if we start with ski pass, the ski pass effect was 6% in total, where the price and mix effect amounts to 5.5%, and the volume was 0.5%. Accommodation was up 6.2%, where price and mix amounts to 4.2%, and the volume growth was 0.2%. As you remember, we acquired TPA, which is Hertel in Plan in Sälen in May last year. And we've had, of course, an increase in revenue that related to the acquisition, and that is included in accommodation, but also in restaurants, we've had a fairly high increase in restaurants, 36%, but the majority of the growth relates to the acquisition of terpotelat. We've had growth in ski rentals, in ski schools, and not the least, sport shops that was up 13.7%, and it was driven by a strong growth related to equip, our own brand. If we continue with operating profit, and the operating profit development last 12 months was -- the margin was 17%. And the amount was SEK 836 million. And during the period September to May, the operating profit was SEK 1.1 billion, and that was an increase in comparison with last year, that amounts to 5%. If we exclude expectation gain, the increase was 9%. And just to remember, we've had no property transactions during the period. We expect to have a transaction during the fourth quarter that amounts to more or less the same level as last year. And the underlying operation has been solid during the quarter, but we have also had positive impact that relates to one-off items, I will explain those later on. So if we take a look on the development category and in comparison with last year, no, we haven't had any property transaction during the quarter. The mountain operation has been impacted -- positively impacted by revenue growth, but we also have increased costs due to higher energy and fuel prices and higher consumption. And we've also had higher costs that relate to maintenance and repair. We try to improve or increase the volume related to both and accommodation. So we have spent more marketing during the quarter to improve the bookings. The operating profit has had a positive impact that relates to an insurance compensation of SEK 11 million, and that relates to the breach in and that was the diminished. And if we take a look at the SkiStar shop and rentals, the growth has been strong, both on online sales and physical stores, but we've also had a positive impact that relates to an adjusted inventory value of SEK 21 million. The acquisition of has had a positive impact on the operating profit that relates to hotels, and property management has had an increase in profit -- operating profit, but that is related to income to other segments, so it's internal income. And we have also adjusted or transferred fund costs to mountain operations that relates to cleaning and airport fees, et cetera. So in total, the operating profit development, excluding expectation gains and currency, was up by 9%. If we move on to cash flow and CapEx, the cash flow from operating activities last 12 months was SEK 1.2 billion, and it has been positively impacted by improved profit. CapEx has been fairly high, and that is related to several significant investments that was made ahead of the winter season, where the gondola in Trysil stands for the majority of the amount. And the CapEx during the quarter -- the third quarter amounted to SEK 77 million, which is a decrease in comparison with the third quarter last year. And year-to-date, CapEx amounts to SEK 427 million. And net debt-to-EBITDA structure is very low, 0.9, and it is a fairly high or huge headroom in comparison with our financial target of 2.5. The financial preparedness as of 31st of May amounted to SEK 1.7 billion, which is high increase in comparison with last year, and that is due to the refinancing that was made in June last year. And interest-bearing liabilities, both included and excluded IFRS 16, has decreased during the quarter. And yes -- and the financial KPIs, if we start with the return on capital employed, has improved and amounts to 11.3%. Equity-to-asset ratio has also improved and was 52. If we exclude IFRS 16, the equity to asset ratio was 67. And last year, the number was 64. So in summary, the financial target, so if we start with the revenue growth, it has been fairly high or a satisfactory revenue growth and that amounts to SEK 7.3 million in the last 12 months. The operating margin has stand on a more or less same level as the last financial year. This amounts to 17%, but we expect the margin to improve going forward. And it will be driven by revenue growth and operational efficiency, and I will come back to that. The net debt to EBITDA was 0.9, and as I said, a quite high headroom in comparison with our financial targets. So if we talk about the operating margin, we did expect the margin to improve going on going forward. And it's a combination of additional efforts to further improve our guest experience, that's not the least initiatives that have already started that will improve our ability to use or our resources better going on. And it's related to staff scheduling, combined duties, initiatives that relates to investment and purchase processes, economies of scale, et cetera, et cetera. And that as those together will improve our margins in the future.

Thank you, Sara. And I will now try to guide you through a little bit of the outlook. And I will start with the summer period, where we have the next or upcoming months in front of us. So here, we have been working now for a couple of years to develop the year-round offer. And now, we are trying to -- I mean we have been working with winter for more than 50 years, and this is the fifth summer season where we work with this year-round offer. And we try to take small steps all the time. And this year, we have been very successful to launch these family passes and also bundle different type of activities, where we include different type of packages. And we also have a soccer tournament in Sälen for the first time. So we will see that the bookings are up 3%, which is, of course, very good. But we could also see that the presale of different type of packages has been very successful. So we are gladly looking forward to the summer. And what's happening at our destinations during the summer also is that all investments for the next or upcoming winter season happens right now. So here, we have earlier sent out the message that we will invest heavily in snow production, and that means that we will offer the most snow guarantee, and we will do that by investing in the snow production, and that will be by increased water capacity. We will have close to 500 new show guns. We will have a new ski lift. And also we will continue to invest with artificial light to prolong opening hours as well that we will prolong and make a much better guest experience. I'm really glad that we have decided to take a larger grip also on our largest destination Sälen, where we will continuously talk about even more new events happening and concepts in Sälen going forward. If I then look into the winter season. So as we have mentioned in our quarter report, there is a strong demand for the winter holidays. And it's also prioritized among families. We can clearly see that. And we're also very glad to see that the bookings are up 3%. We were a little bit surprised by the strong number actually. We had in our second quarter, plus/minus 0. And now, the last couple of weeks, the booking has had a very steady growth every week by week. And we believe that 1 of the reasons for this is that the launch of the Scandinavia's most extensive snow guarantee will be 1 of the real reasons for that because we will offer something completely unique in Scandinavia by offering this no guarantee and also possibility for our guests to cancel or rebook even up to -- close to this day. And we feel very confident in this guarantee since we are investing so heavily in the snow production. We also have a very strong Christmas and New Year calendar this year with an extra week 53, where we will gain extra ski days for sure. And then, the early Easter week 12, 13 means that we will also work very adjustable with the end of the season connected to how we will have opening hours, et cetera. And that will also help us according to what Sara just spoke about with the scheduling and also how we will combine different type of roads within our staff. Price increases, we will increase the lodging prices fairly 0% to 1%, as we want to become even more attractive in the lodging prices. And we will have a ski pass increase for the upcoming seasons 4% to 4.5%. And we will also continue to launch and have the lowest price within the Scandinavian mountains on ski passes. So we will add an extra low price Kepas this year. We do it and -- and that will, of course, be complemented by the last year's success of Clece Duhon and Sälen. So some really good price ladder with a really good long -- low-price alternatives for those consumers who wants to go for that alternative as well as the ones who wants to go for the full scope. So if I summarize where we are right now, we can see that we have a very stable development that also enable us for further revenue growth as well as improved margins, and I think we have some really good learnings this quarter that we have to work much more with flexible cost and also look into our cost side, which we are doing and has been doing the last 2 months in a good manner, actually. We also continue to invest, like Sara also said, to strengthening our guest experience and satisfaction. We can see that it really pays off. And one really important part of that is, of course, to launch these best and most extensive snow guarantee within Scandinavia. We still see a hesitant real estate market, meaning that we see a much slower development, as we have thought compared to what it was in the past, meaning that we say that we will most probably coming in, in the numbers like we did last year in that size. And then lastly but not least, we see a strong demand for mountain vacation, plus 3% in booking both for the upcoming summer as well for the winter season, respectively. So by that, we open up for Q&A.

[Operator Instructions] Your first question comes from the line of Alice Beer from ABG Sundal Collier.

Just a first question. Your OpEx base has grown quite a lot this fiscal year so far. Could you give us some color on this? Just how much is temporary? And how should we think about the run rate, just what you can do to improve scalability short term?

I missed actually the first part of your question, Alice, sorry, please repeat the question.

No worries. I'll repeat. So your OpEx base, so your costs have grown quite a bit this year. Could you just give us some color on the OpEx costs? And how much of this is temporary? And how much do you think about the run rate? Just what can you do to improve scalability and reduce costs?

Yes. And so I can try to answer that, Ali. And during the quarter, we've had temporary increases that relates to fuel and electricity. And I guess some of the reasons may be geopolitical, geopolitical situation, where we have been increased in both especially related to electricity that the costs have also been impacted by volume. It was then cold in January and February. So the consumption that related to electricity was also high. So some of the increase that relates to electricity is related to price and -- temporary price and temporary volume, I would say. And when it comes to fuel, we have had very high prices that relates to H3O 100 that is used for more or less all vehicles -- and the price increase was more or less -- you have the number?

SEK 29 per liter the last month of April, which, of course, is impacting us heavily, even if it was just 1 month, April. In March, we paid SEK 25 per liter. So of course, that impacted us heavily in the quarter. So I think that's 1 of the reasons. And like Sara said, we also -- we are hedging electricity on our expected level, but since we had an increase of electricity use during this cold period, we had to buy electricity on the free market. And of course, that costed us extra much this quarter, more than we expected.

And if I continue, we also had a fairly -- we had higher costs related to marketing activities, both related to the possibility to improve or increase the sales for CPOK and accommodation. And that wasn't really -- the efforts didn't pay off actually. So that would -- I would see that cost or that spend as a temporary one. And we also had high marketing spend that relates to our online business in retail. And those are expected to slow down or decrease going forward. Yes. So that is what happened during the quarter. And if we then look forward, we are now since 2 months back working on our cost situation. and both from a staff perspective, but as well on purchasing activities. So I think this staircase, we showed on the slide, which we call initiative to reach our financial targets. If we look into the middle part of that, when we say efficient resource allocation, that is something we are working with right now. And we also expect that we are coming into our next fiscal year '26-'27 on a new level from a cost perspective, which feels very comfortable going forward.

And the efforts that relates to the combined duties, the scheduling of staff, that will mean that we actually reduce number of employees or FTEs. And it's a combination of temporary resources and another resources or employees. So in Turkey, we have a fairly high number of entries that will be reduced. So we have a number of initiatives that will improve the cost base going forward.

Moving on then hotel sales are growing quite a bit, while mediated accommodation did not this quarter. Is this a deliberate shift? Are you seeing an organic change in demand from normal accommodation to hotels?

So again, Alice, sorry, can you please repeat the question, and I think we need to increase the volume here as well.

You're talking about increase in net sales on [indiscernible].

Hotel sales, quite a bit. Is this -- but normal mediated accommodation did not -- is this a deliberate shift? Or is this an organic change in the math?

That relates to hotels, then of course, we've had an impact effect from the acquisition of, that has impacted, of course, the volume and the revenue that relates to hotels.

And then if we look into the accommodation, we lowered the price quite heavily during the third quarter, also try to trigger consumers to book and so on. But I must say, all the efforts we did by increased marketing, lower the price on accommodation, lower the price on ski passes didn't pay off at all. So unfortunately, that was wasted money, more or less, I must be honest to say.

Okay. Okay. And moving on, could you talk a bit about the rationale behind closing Vendola for the summer? I mean, despite this 3% higher bookings for the summer.

Yes, absolutely. And if we look into what's happening in the market, you can say when we decided to go for full scale of summer activities, we decided to continue the development of over where it started already actually in -- around 2007 in small scale. All that has been very successful in driving some activities. So when we decided to go all in for summer, we decided to continue all there, let's go for Trysil, let's go for Sälen. And we did that the first 3 years -- 2 years, 3 years. And then we said, let's add Hemsedal and Vendola, but unfortunately, we don't have the number of guests enough to run 5 resorts in the summer. So that's why we have decided to not run this climbing park as well as the lift in Vendola for the summer. So we still have openings for possibility to book overnight there, but -- and also by clothing in our store, et cetera. So that has been important to keep open. As well, we do the same in Hemsedal, both limited opening times, et cetera. But we go full and all in Sälen and Trysil because there, we see that there is possibilities to drive these summer activities in full scale, more or less.

Okay. Perfect. And then you said that 30% of the upcoming winter accommodation is already booked. Could you provide some context here? What is an average booking rate for this point in time?

We are actually a little bit -- we say around 30%. So we are 30% plus. So we're a little bit above last year since we have this 3% increase, so we are on a quite same level. But what I think is important is that we had added a number of beds, both the 600 new beds in sell, and we have also added a hotel in order, of course. So if we then say that we are plus 3%, of course, it's on a very good level, I must say, a very stable level. And if you look into the number of booked overnight, it's on actually a fairly high level, probably the highest level we have had since the pandemic.

Your next question comes from the line of Karl-Johan Bonnevier from DNB Carnegie.

A couple of questions from me as well, please. You mentioned the insurance claim that you got the payback on and the reversal of the rental equipment accrual that you have done. How would you -- I guess, these are more timing effects or how should we see them I guess you had the insurance cost at some stage, and you also had done the accrual at something. But could you elaborate a little on how the timing of these things work?

We weren't sure when we were supposed to receive this insurance contribution, but that took place now in the third quarter. And it has been recognized in other income. When we actually rebuild the bridge, it will be recognized as an investment and including CapEx. So we need to treat those transactions as 2 separate ones. So it will impact CapEx going forward. So I guess, in to say the first or second quarter next year. And a bit -- I'm not sure about the number, but it's roughly the same or a bit higher amount, 20.

Yes, roughly the same number. Yes, yes. And then also this -- so it's exactly like you asked, it -- we weren't sure when that insurance money will come actually, and nowadays, they came a couple of weeks ago. So they gave us some positive numbers, of course.

So it should be seen as a one-off item as it has impacted the profit and loss, and it will not impact or, of course, it will be impacted as a depreciation, but it will -- the transaction will be treated as an investment. Yes.

And then the other question was around Ski rentals.

Yes, yes. we have reduced -- or we have adjusted the inventory value that relates to equipment, rental equipment, and that is also a one-off item. But this level effect will be seen going forward as well, but not in 1 quarter, it will be for a whole year next year. So the level effect will stay.

So if you carve out those 2 items, I think we are on the expected level from the result -- the expected result this quarter, more or less, you can say. So those are 2 onetime positive effects on the quarter results, of course.

Yes. But I guess, at least for the rental equipment, you must have over cured than in previous quarters. So maybe if you're looking at over the full year, then it doesn't really matter, does it, sir?

No, correct. Correct.

That's correct.

Total correct. It's been more than -- sorry.

And then on the other side, you mentioned earlier the extra marketing cost and the higher HVO 100 costs and these kind of things. Are these numbers basically matching against the -- what you now have as these positive one-offs in the quarter, as you see. So if you say the negative one-offs you had in the quarter, we are basically on a lower level on the total.

That's the final good assumption, absolutely. Yes.

And I remember in Q3 last year, you -- with the late Easter, you have the problem ramping down the operation in an efficient way. It looks like you've been able to ramp down much more efficient already this year. You mentioned that's an opportunity for next year or am I over reading things?

No, you are right. But we are still not satisfied with that ramp down, to be honest. And that's why we have decided to be even lighter, so to say, for next year because we have too much fixed cost, where we are sitting in -- yes, so our business model and the full opening makes us very vulnerable when the volume decrease like it did in the third quarter now. So that's why we have decided to try to keep us a little bit lighter and work much harder with these combined duties with the scheduling, et cetera, to have a smoother operation, so to say, going forward. And that's something we also now have the organization backing up even though it's, of course, tough when you need to do it. But it is helpful going forward.

Excellent. And when you look at the already good booking situation for the next high season, the 3% increase, is the -- how do you see the mix there developing when you're looking at international demand compared to local demand?

We continue actually to be on a quite stable development of the international guests, so they are on the quite the same level. But it is actually the Swedish guests who is coming back now. So they are standing for the increase of the bookings, so -- which is very gladly to see that the Swedish guest is returning back now since a couple of years of maybe reductant since we have had high cost of interest rates, high cost of energy and high cost in general in the society, but we can also see that the consumer confidence is coming back in Sweden. And I think this is a result of that when we see the strong booking numbers.

Excellent. And 1 final, looking at the CapEx budget going into '26, '27, do you see that being in absolute, say, kroner on an unchanged level compared to what you see in this year, including all those investments you have detailed?

Yes. So I would say that the level will be more or less the same, and that is, of course, related to the investments in snow production that will sort of keep the level a bit higher than the usual. Yes.

[Operator Instructions] Your next question comes from the line of Stefan Stjernholm from Handelsbanken.

Yes. A question on the next winter. Given that Q3 did not really meet your expectation. You talked about doing adjustments for the ramp-down of the destinations. But what else can you do differently for next season?

No, but I think what I tried to explain is that we are working on our fixed cost situation. We have built up to heavy organization. That's why we want to become lighter, more or less. So it will be on staff. Then, we have also identified a lot of different type of purchasing projects, how we want to do a different type of purchasing. And so like many other companies, we are also reducing costs and looking into our total cost situation, which has been important to do for us because we really want to secure that we will not be as vulnerable as we became in the third quarter this year. So we had to be able to adjust. We will also work much more with the opening hours and opening time in the end of the season, which meaning that we will have a different plan how we are running our ski resorts. So we will open first and we will close latest as we have done, but it will differentiate between the destinations. So we are working quite hard on that scheduling as such, meaning that we will be much more efficient as a totality, I can say.

Okay. My other questions have already been answered.

This concludes today's question-and-answer session. I will now hand back for closing remarks.

Thank you so much for listening to us today. Also, thank you so much for very good and questions, making us try to explain even more about our quarter results. And by that, we are wishing everyone a nice mid-summer, if you are in Sweden, and of course, everywhere else as well, and enjoy now the time outdoors because we would like to do that and going to the mountains and enjoy hiking and biking.

This concludes today's conference call. Thank you for participating. You may now disconnect.