Aalberts N.V. (AMS:AALB)

Investor Day 2019

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Dec 4, 2019

Yes. Welcome at our experience center and people joining our webcast. Yes, today, we will evaluate the 2, the 1st 2 years of the execution of our strategy focused acceleration, and the agenda will be as follows. So first of all, we will talk a little bit about the Albert's strategy, which we announced 2 years ago, but also we want to tell you something about the way forward because the last 2 years we evaluated our strategy. And as normal, when you run your business, you also try to improve. Now what you want to improve, you also have to take actions for that. And we want to tell you something about how we want to involve Albers into a stronger and better Albers. Of course, there's also a financial development, which is the effect of that. We also want to show you that. So I think we give a lot of insights about the way forward, the coming 3 years to that to our strategy. Then we have Q and A part 1, then we have lunch and then we will talk a very interesting part I think about strategy in action. A lot of you and also the webcast joiners I think asked about what is now exactly your business. So I think this afternoon, you have a great opportunity to talk with the people who really run the businesses. You can answer the questions, you can see how we do the business, how we create growth drivers and how we succeed in that. First of all, this is a very important thing. You will find hours everywhere where technology matters and real progress can be made, not only financially, but also environmentally and humanly. We are a company and that's a little bit of modern work where purpose is important because it's not only about the financials, it's also about that you can attract the right talent to your company. But also environment is important. You have to have a sustainable responsibility to create also the future in life. So everywhere where technology matters and we can innovate our existing positions, we want to be there. What is the essential part of Alberts? We say always niche technologies, mission critical technologies for different industries, but it's always niche, it's always special, it's always unique. The second part of our essential brand, our essential being is in my opinion that for us good is never good enough. That means that you go the extra step. And of course, you can say that a lot of companies do that. But I think the way we do that already all these years, well, in a sustainable way is really special. We do that with mission critical people, very important. The 3rd essential point is that we share knowledge. Why is Albers together? Why do we have 4 business segments? What is the interest of having them together? I think we share a lot of knowledge and greatness is made of sharing knowledge in our vision. It means you are fast learning, you innovate faster, but you also create a lot of ideas where you innovate faster and you learn faster in this very challenging world, which goes faster and faster. So the moment you share your ideas and you use every brain cell you have in your company, you innovate faster and you serve your customer on a better way. That's our belief. And of course, relentless in our pursuit for excellence. Good is never good enough, essential. Culture is therefore very important. Our way of value creation is based on these three essential things. So we strive for leading niche technology positions with high entry barriers, high pricing power and we continuously evaluate the portfolio. Combined with our culture of operational excellence, improving our EBIT margin continuously, strong cash conversion, we have the cash also to allocate as on the best way. As you know, I said many times, capital allocation is the most important thing you can do as management because in the end, it's about return of your capital employed, about the cash you generate. You told me and I learned also from you that cash never lies. Greatness is made of shared knowledge, I already explained, innovation speed, fast learning and adaptation, technology exchange. You can't imagine how much knowledge is exchanged by the people within Aalmat. That's also why we created here this experience center to share these ideas with externals, with internals and it's really working. We are here now 1 year and I can really tell that a lot of teams have been here and also we organize a lot of external events and it's all sharing knowledge to adapt to the fast moving world. The Albert's playbook, already 40 years, relentlessly creating long term shareholders' volume. We create competitive advantage every day and you try to analyze what are the growth drivers in your business. We will explain this afternoon in the businesses which we represent to you. Leverage and excellence operationally and increase your margin continuously. That means it's sort of playbook where we then generate strong free cash flow, which we allocate on a disciplined way. With that money, we improve our portfolio, can be organic or inorganic. That continues all the time, compounding returns. So it's a long run. It's a mid long run. Of course, you have to manage the short term, but this is really the Albert's playbook. We will never stop. We will always improve. It's not something you present a strategy and that's the end. No, you continuously improve. That is our way of working. This slide, you just actually don't have to explain. Over 40 years, the Albus playbook, a proven sustainable business model for 40 years, our track record. We will continue, yes? I'm also working more than 20 years in this company and a lot of me are also with the same passion to drive the business every day, create new initiatives, launch new products, but especially create unique market positions. Our shareholder value creation, you can see here, even today, of course, it's not 2019, but this is the year 2018, 2018, you see what we achieved for our shareholders. But also the right side of the sheet, you can see our long term shareholders, more than 3% holdings. It's more than 50%. It's really changed the last years because long term value creation, that's what we are. So also shareholders want that we pursue that further. This is very important. I can't say to you how important this is because without the best people, without the people of the future, you can't win. So winning with people makes really the difference. And this in my opinion is the big threat what a lot of companies have because when you don't attract the right people to your image, to your strategy, to your image, to your whatever you have, you don't win the war, you don't survive. So for us, our mission critical people are essential, but also the future people that will make the difference. So we believe really the Albert's way is winning with people, but then also attracting the right people for the future. There's a lot of disruption going on in all kind of markets. And when you think as management or as CEO or whatever that you know everything what's happening, I can just tell you forget it. You have to listen to every new initiative. You have to listen to every new person. So young people, trainees, good educated or machine operators are very important for us to survive. So that's also why our Alberts brand is so important and we have to utilize that more. Our values, the Alberts way winning with people. Our strategy and objectives, we launched 2 years ago. First, we want to realize them before we change them. So we are relentlessly driving these targets and objectives, not only the financial objectives, because also the non financial objectives, because we need leading niche technology positions. We need to create sustainable profitable growth, generating high added value margins and converting strong operational execution into free cash flow, very essential to hit our financial objective, which we reached which we want to reach as soon as possible, as we said 2 years ago. So we have a time frame of 5 years, but our objective is to reach them as soon as possible. Evolving into stronger and better outlets or evolving into uneven stronger and better outlets that could also have been the title. We have evaluated the last 2 years of this strategy. And when you launch the strategy and you all know we are in a journey, the fun is that we are in a journey. It's not an endpoint. Now we are in a journey transforming the company, making better and better and better. Then you also learn. So today, we want to share with you what we learned and what our action and strategic initiatives to further accelerate our strategy, which we launched 2 years ago and then evolve into a better and stronger and even better and stronger outlets. So what was our what is our evaluation that allocated our capital in the most efficient way to generate the highest returns. You have to be very, very, very disciplined and very, very, yes, let's say, on top of these things because don't fall in love with your businesses because you are emotionally connected. And what we saw is that some existing business plans are doing very well, a lot of them, because as you know, we launched these business plans 3, 4 years ago with innovation roadmaps. Some are doing very well, generating a lot of CapEx demand, but we also have activities where we say we have limited progress. They require a disproportional efforts and cash. And don't forget the efforts and the energy you put in as management. So you put in energy and then you don't get the returns or the increase of margin which you expected. That's disappointing, yes. But you also have to be very rational. When you can allocate your money better, you should always do it. So of course, we found out that in the last two years that we also have businesses which do much less than we expected. So what do you do then? You adapt. So we think that we should further to build an even stronger and better harvest, we should further narrow our focus and accelerate the plans, which do not very well. We will invest only where we have a compelling competitive advantage, where we can really increase our margin and returns and realize sustainable organic growth. And the megatrends are shaping our future. We should include that in our strategy. Sustainable impact is very important. More and more money will flow to sustainability. It would actually not wise as an entrepreneur not to take advantage of the sustainable trend. We are entrepreneurs. We want to make money. So when you want to make money and to increase your position, then you should grab these opportunities. And we will accelerate, we believe, we have to accelerate our operational excellence, reduce our complexity further. We did many things already in the past 5, 6 years. But still, there's so much to gain, in my opinion. How more and more you dig in, how more and more you can gain. In the end, it's all about capital allocation to evolve in a stronger and better Alberts. We defined actions for that and the nice sheet, the next sheet will show you that. And we took actions, we took decisions, we took strategic initiatives to transform faster than we did the last years. So the coming 3 years, we will have a set of measures. But first of all, what is now shaping our future? Shaping our future are megatrends, which we cannot ignore. Rapid urbanization, look around these windows and see the buildings. They have to be healthy. They have to be sustainable. Climate change, resource scarcity, Internet of Things, these things are happening. These things are disrupting markets. It is happening. And sometimes I think a lot of you don't see that in-depth, go in-depth and you will see that more and more. What is then also a trend? The market trend, which follows out of that embracing the sustainable development goals, which we really embrace because we take our responsibility there. But we also believe that this sustainability development goals and Brigna is really business. So you see 2 big trends, 2 big developments, globalization and co development and connectivity and integration. What does that mean? Globalization is clear. Despite all kind of, let's say, political discussions, we see only further globalization and co development. That means the bigger OEMs, they ask for R and D and investment power of their partners. So we are very strong. We can fill that gap. The second thing is there are more solution needed, more solutions, more connected hardware, more devices which are connectable, more software, more digital services, more integrated systems, integrated solutions. These trends are actually in every business which we have. And now, Alberts comes in because you can share this knowledge between the businesses. We can share through our Alberts networks because in every business this trend is there. It's not only advanced mechatronics, it's also Piping Systems, it's also Hydronic Flow Control, it's also Service Technologies where we have the same trend everywhere. So we have a fantastic window to jump in. So what is our aim for that? We have niche technologies and we have selective end markets. We are in the sweet spot. We want to be in the sweet spot. So we have to choose more. We have to choose more our niche technology. We have to choose more and select our end markets more to achieve more and more unique market positions with sustainable impact where we have a leading position. But then you have to make choices because when you do that, you have to make hard choices. So coming from these unique market positions, we said compelling competitive advantage. Where do we have really compelling competitive advantage? Where we really can win in the markets with our people? Then you have to go really deep. We want to be market leaders. We want to be we want to have pricing power. We want to have a unique market position. Then you have to really be honest to certain things. So we will choose for this hydronic flow control, piping systems, service technologies, fluid control, advanced mechatronics. As you maybe can remember, we had 15 technologies 2 years ago, we will go to 5. We have turn end markets, we will go to 4. We believe that eco friendly buildings that means economically, but also sustainably that there in buildings will happen a lot. 60% of our revenue is in eco friendly buildings. We have to expand that position. The second thing is sustainable transportation. We say here in the air, on the land and on the sea, it's a big thing, which is generating a lot of potential on fluid control, on valves, on regulators, on emission systems, on sensors. So our fluid control activity, but also our service technologies in aerospace, weight reduction, yes, but also going to other materials is a real trend where we see a lot of opportunity. In other areas, like in, let's say, certain automotive areas, we don't see opportunity. But in service technologies, we see a lot of opportunity. But certain specialized manufacturing, for example, we see less opportunity because of the change of the electrification of cars, the change of the voltage of cars, the change of the engineering of cars. So you have to adapt to that world. And as 4th, semicon efficiency, besides our industrial niches, The first industrial niches, beverage dispense, for example, very interesting. All kind of new liquids are all kind of new beverages are developed. So we have a great position there. Semiconductor efficiency, just for your information, it was 2% of our sales 4 years ago. It's now almost 8%. We're going to double it. We have such a good position in semi coal as a Tier 1, Tier 2. That's great. And the nice thing and this afternoon we will explain that to also through our colleague. The nice thing is that we have our own intellectual property. We are not a contract manufacturer. We are the co developer. And we develop motion control systems with our customers. Many OEMs worldwide, great position. But it also means when you want to achieve these positions, you probably also have to take measures because you can't allocate your money everywhere. So where technology matters, real progress can be made, that is where we want to be. Innovation roadmaps, more allocation of money to the business, which are growing fast. Also, next year will be for us a very nice year in semicolon. So how does that position ourselves? Our unique leading market positions, you know our segment structure. So installation technology, piping systems, material technology, service technology, how do you improve the characteristics of the business climate technology, hydronic flow control system and we will present these businesses this afternoon or you can show them in the experience. Fluid Control, Advanced Mechatronics and Semicol. So you see the link between the end markets and our technologies. Be aware, we came from 15 technologies, 10 end markets. We go to 5 and we go to 4 end markets. The networks of ours are very important and they stimulate knowledge sharing, fast learning, innovation and entrepreneurship with a very lean and mean head office because we need entrepreneurial spirit close to the customer. But the Albus brand and the Albus networks are really accelerating our innovations. So what do we have to do to go faster? This is what we're going to do. Albus will accelerate. So we will increase our innovation rate from 10% to 20, and we are already on the way. We have roughly 6 or 7. We measure that now. We go to 20. So we will invest more. We will invest more in CapEx €140,000,000 to €160,000,000 a year. We will focus more on our unique market positions with a compelling competitive advantage. Therefore, we will divest more the coming 3 years. So I told you all that our divestment program was now till now €50,000,000 to €70,000,000 left. So we will increase that to €300,000,000 to €350,000,000 to focus more on the businesses, which we think where we have a better compelling competitive advantage. Meantime, due to the structure, which we are more and more in place after transformation, we are able, especially in installation technology, to reduce our inventories heavily. So we have a program and we are good underway already in 2019 to reduce our inventories with €100,000,000 to €150,000,000 based on the deal, the days. Of course, you grow. So my colleague, Arnaud Monex, will explain that also later. We acquire CHF100 1,000,000 to CHF200 1,000,000 revenue roughly during these 3 years. We continue with bolt on acquisitions, but what you also see, we believe that there are so many opportunity organically that there we will put the focus more and more on combined with bolt ons and we will divest between the €300,000,000 €350,000,000 We will realize and that's really a goal internally, but also of course externally now that we realize an operational leverage and excellence a drop through of 25%. So it means the moment you grow organically €10,000,000 you earn €2,500,000 EBIT. That's 25%. So we have to drive the business. The coming years, we're going to execute the operational leverage and excellence. With automation, we're So but we also have sites where we believe we should not put so much money in. So we reduce our locations with more than 30. We have a slide on that later, including our divestments and site closures. So we will accelerate our operational excellence. We'll improve, as I said, in manufacturing locations to world class to be the best in business, because we want to be leading and have high pricing power, increase our margins. So further focus on clustering our simplification from 10 to 4 end markets, from 10 to 5 niche technologies. Also important, we will concentrate all our group, Alberts Group activities. So that means also for the group management which works outside, we will integrate in our lean head office. So probably we go from 25 here to maybe 30 because the rest probably we don't need because we want to be lean. So we have no group management, only which is business related. Other will all be here in a new head office. So we will concentrate and have more direct reports. Stimulating and sharing fast learning through leadership networks, accelerating our sustainable profitable growth, organic growth, EBITDA and ROCE percentage. Our of our revenue is related to R and D investments. When you look 5 years ago, we had roughly 3 or a little bit lesser than 3. This is also the reason that our added value went up, but not our EBIT so much, yes, because we invested a lot in R and D, we invested a lot in sales. That's the coming years, we will drive the innovations only in Climate Technology and my colleague will explain that. We have 15 new product lines to be launched from summer this year. So we will drive innovation more and more the coming years and after that it will not stop. Innovation rate, come rate very important, will strongly increase. We see it already now. Our innovation rate is climbing. Our goal is 20%. That means business which is launched 4 years ago has to be 20% of the year, which is the current year. So launched 1st December 2015, yes, 1st December 2019, 20 percent of 2019 should be that innovation rate. Come rate also improving, increasing because we go more global. We go more after globalization co development, a lot of opportunity. Capital allocation actually will be the same, more CapEx, bolt ons, but more focus on organic and when we get a good opportunity for a strategic footprint, we want to have to have the money in our pockets. But till now, prices are too high for us, multiples are too high because, yes, it looks like the money is still cheap. And in my opinion, the prices too high, but maybe time changes, could be. This is also interesting. Where do we allocate our capital? Acquisitions, CapEx. A lot of you asked me also that where do you allocate your capital? Where is your CapEx going? Now here it's going, mainly connections and valve technology. Rolling out the technology in press fittings is a huge opportunity. My colleague will explain this afternoon. Zales in America, in APAC where we are not present, so we can just copy paste technology which we have in Europe, not just at least we have the knowledge. Innovation, efficiency in our distribution, You know we went through the last 4 or 5 years through a huge change in distribution efficiency, our own warehouse in America, now our own warehouse in distribution center in Europe. And we get it more and more efficient. We will see that the coming years and we already see this year in our inventories. And of course, capacity we have to add. Acquisitions we don't need there. Material Technology, Footprint Europe, Footprint USA, we continue. Acquisitions, specialized technologies, which we did also with PPC in Chicago, which we did with Applied Process, with the arse tempering, which we did with Royal Metal Finish, corrosion protection in Greenville, all mines acquisitions, very nice companies. We will continue with that process. Climate Technology, Energy Efficiency Digital Services, Footprint USA. Footprint USA, because we can follow the same strategy as we did in Insulation Technology. We need a footprint there. You can do that greenfield, but faster goes acquisition. So here you see where we want to allocate our money and our CapEx. Sustainable transportation, sensors, valves, regulators for automotive electrical cars, hydrogen cars, emission rights in container ships, all these kind of things, a fantastic market. We have their dominating positions, sometimes 70% market share in our product lines. So why not expand it? Nice acquisitions we did already. FenTrack, staff, we want to expand them. Come expansions for advanced mechatronics for distance technologies. Mostly including the footprint in Asia can be organic, can be inorganic, a lot of ideas, a lot of creativity and a lot of ideas to create long term shareholder value for you, but also for our other stakeholders. Relentless in our pursuit of operational excellence, Our current footprint is 156 locations worldwide. We have 63 manufacturing locations and we have 93 service locations, mainly and they are almost all immaterial technology. We're going to rationalize that, including divestments to 122 locations worldwide. So we go to 46 factories and 76 service locations. That's our goal. From these 46 manufacturing locations, we have to improve or upgrade in our opinion 2.0, 9 locations of them to make them build plans. In our service locations, we have to improve 7. So the 122,000,000 is combination of site closures and divestments. Besides that, we are continuously driving projects per team because you have to create a culture. A lot of you asked me, hey, can you give an example? Yes, this is an example. But the nice thing in operational excellence is you create a culture of continuously improvement that you invest a small thing and you reach a big thing in safety. That's between the ears of the people. And we made a good way forward already, but it still can be improved. But this is a big thing. We also want to follow that in our reporting the coming years, so you can see where we are. Of course, when we do acquisitions, then 100.22 will go up, but then they are in the right sector. And of course, this all these measures will have an impact on our potential development of our financials. Important is that you see this as a potential and because we made our own model and we made our own assumptions and you can see at least the potential and important it doesn't stop after 2022 because it's the Alberts playbook. Okay. I give the word to my colleague, Arnaud Monjej. Thank you, Wim. Welcome everybody and also welcome to the people in the webcast of course. Yes, the potential like Wim said, very important to understand what we try to explain here because as you know us, we have set our goals for 2022, which are standing there and which we are going to realize. And this is just to give you some insight, yes, what all these good actions that we've described, yes, how to evolve Alberts into a stronger an even stronger and better Alberts than it is today, what is now the impact of these actions? So therefore, we made this model where we put in these data and I would like to share that information with you what the outcome is of that. As said already many times, organic revenue growth. You know our goal, the average growth over the 5 years, more than 3%. So for your information, we made this model, of course, also based on these assumptions, but we also made a calculation based on 5% average growth to see what the impact is of our improvements. A lot of focus, R and D, a continuous investment in leading niche technology positions. So we increased the R and D percent to over 4% of the total revenue and the CapEx to €140,000,000 to €160,000,000 There are so many good innovative growth ideas, initiatives that we want to inject with our CapEx budget. Operational leverage excellence drop through of 25%. That is the assumption that we also took in the model to calculate the effect of the improvements that we have already explained, of which, of course, also portfolio optimizations is an important one. Divestments, to increase the divestments to, let's say, €350,000,000 revenue in the next 3 years is a big step. It really improves our portfolio because at the same time, we will also do bolt on acquisitions, but very much focused. As we have already said many, many times, we don't do acquisitions to do acquisitions. We do acquisitions to strengthen our position, our leading niche technology position and also when possible to speed up the execution of our strategy. So therefore, you do very focused targets, targeted acquisitions. And yes, as also Wim said, we remain very disciplined with our capital allocation. So also with acquisitions, the prices are sometimes too high, then we step out. We only pay what we believe is sensible to pay for. So we remain very critical there, only when it makes sense. And not to forget about the inventory reductions. We already showed you about, of course, the rationalization of our footprint and the reduction of locations, but we also started this year already with the improvement of our DIO to really focus the teams on the ideal inventory. And sometimes that is higher because we also do a lot of introductions of new products. And when you do innovation and you introduce a lot of new products, of course, you need also the stock to be able to start up a successful sales of that business. But it is all in the detail and you have to be on top of it. And therefore, yes, we believe that with the access that we have in mind, also with the improved distribution footprints, yes, both in North America and also in Europe, where we created central warehouses to replace a lot of smaller warehouses, that will also have the effect. Now what was then the impact? And again, this is a calculation of the improvement potential of our EBITA. Now when we have these two scenarios of 3% and 5%, it shows from the calculation that the portfolio optimization is about 0.5% improvement. And that is also logic because you have, of course, a divestment of lower contributing businesses. And that's the reason that we also would like to divest them because we don't see with all the capital that we need to allocate that we get the right returns out of that. And on the other side, of course, we acquire the companies in the heart of our strategy, in the heart of our goal. So therefore, these companies have, on average, a better EBITA percentage because these companies already have a good margin position market position in their business. That's the reason that we would like to acquire them. Now what you don't see is that you see the big difference between 3% to 5% what happens out of the improvements of operational levers and excellence, 0.8% versus 1.4%. So adding these together, the improvement potential based on these, let's say, point let's say, starting points in our model that gives an improvement until 20 22 potential of 1.3 percent of EBITA in case of 3% organic revenue growth and 1.9% of EBITA percentage in case of 5% organic revenue growth. That is how you become an even better and stronger Albert. Very important KPI, the KPI where everything comes together, the return on capital employed. Also there you see that in the case of 3% and 5% organic revenue growth, the additional improvement of ROCE is 2.4% in case of 3% organic growth and 4.2% in case of 5% organic growth. Efficient capital allocation drives ROCE increase. And like Wim said, it's all about for us as a leadership team, it's all about the right capital allocation. We remain very critical with it and the outcome is what you see here if you make the right decisions. And so what can we learn from that? The outcome of these calculations is that we are doing the right things. We are focusing even stronger, even better on the right niche technologies in the right end markets. We are playing the OWL's playbook, as Wim said, constantly the right allocation of capital to improve our financial performance, but also to improve the ROCE, the return on capital employed. And not unimportant, when you make these improvements and when you continue to develop with doing the right things, it doesn't stop after 2022. Thank you. There must be a lot of questions then. We have to sit together. Okay. So where is the first question? Martijn and Dreif, ABN AMRO. When you talk about portfolio optimization and more specifically about the divestments, can you talk a little bit more about the timeline, front end loaded, back end loaded, just a bit more on your thoughts about that element? The time line of the divestments, it is what we plan this deployment we plan in the next 3 years. Are you already preparing data rooms? Are you already have you already some sort of short, long list? Has the pros that really been started. It's like with acquisitions. We are always preparing. We are always looking and working on it. But of course, everything is depending of when you really are going to execute it. But we have a planning for ourselves in the next few years to divest this amount of money. And broadly is that maybe to add that all decisions are taken. That's also for the inside viewers for the webcast that everybody knows in person who will be divested, because otherwise we get a lot of, let's say, unrest. So we prepare that well. So we know exactly what we're going to divest. We discussed it also with the leaders of the management. So the persons who don't know anything, they also know they are not divisive. It is very important to create no troubles inside. But so we have a time line. And as you know, we were already busy with the €50,000,000 €70,000,000 So it was already a process. So but we will accelerate that. But it depends also, as you know, on the price. So we always said, yes, when it can take a little bit longer and we get a better price to optimize the business, then we will take a little bit more time. But the aim is to the goal is to divest in this 3 year period. And just to clarify these targets that are at least implications for follow through on EBITA from organic growth, Is that 2018 as the base or Let's say that what we have said, I think clearly also in the beginning and also 2 years ago when we announced the strategy, the goal of more than 3% average is a goal over the 5 year period. And what I now show you in this calculation is an average of 3% and an average of 5% what the difference of impact is over the 3 year remaining period. That's what we show you. Thank you. So it's the improvement potential for EBIT percentage when you would execute all these measurements. And of course, you have peaks and you have dips in business. You have always. And yes, as some years you have better, some years also markets which do better, I do not. But this is the average line. So I think this suggests the measurements we do what is the effect of the measurement. And based on that, we hit our objectives and we say soon as possible. Tijs Holzern, ING. A follow-up question on Martijn's question. Is it that you have to divest, let's say, €12,000,000 €25,000,000 revenue companies? Or is there more concentration, let's say, euros €100,000,000 because that also is important in the business of the execution? It's a good question. Let me think a little bit. So I think it's 2 bigger units and then a combination of smaller locations in materiality and omni. Okay. And also a Small combination. Yes. And a follow-up on So it's gripper to do than what we did in the past where we did more small things. Yes. So you don't get, let's say, CHF 20 announces of CHF 10,000,000 goes very slowly. No, no. Then would not announce it anyway, but Yes. And then on the reduction in inventories, I think that, yes, most people in the room didn't believe it anymore because it's a recurring topic for hours, but say you have always had relatively high working inventories. So is it now the what was it, €150,000,000 of reduction? Is that set to No, euros 100,000,000 to €150,000,000 euros So you said somewhere between that. Euros 70,000,000 is coming from the disposals then, because 22% is the inventory as a percentage of revenue. Is that correct? Of course, more or less. With the disposals also some inventory goes down. But if you let's say, what we explained about the €100,000,000 to €150,000,000 is that this calculation in days. So the effect in days, if you recalculate it in 20.72, that should come to the €100,000,000 to €150,000,000 bar. And what actually did happen? How did you find that out now after all these years? Let's say, we made, of course, our operational excellence programs. But don't forget what we explained, as I remember very well, also for North America, for instance, where we completely changed the distribution platform, where we exchanged own locations for external sales rep officers, where you first have to build up ship in before you can, let's say, cancel these sales representing offices, where you introduce also a successful introduction of a new product, where you have to ship in first the stock to really start successful sales. That is now moving. Also the distribution footprint is now getting really operational. So we see big improvements over there. The same with Europe. Also in Schlage Technology, we are if I remember well, this month, we are taking a new warehouse in use in Holland, which is replacing 7, 8 small locations. It gives all, yes, more efficiency also in the stock management. So just to add, it's not what we found out. Ours is in a journey and we consolidated and we transformed the business, for example, to integrated piping systems. First, we brought Europe together, then we brought America together, and last 3 years, we brought global together. So that means we have now one brand name. So it's the journey where you go through. In the meantime, we created our improved supply chain in America, which it was a big hassle, but it's there now. And we are doing that also now in Europe. In America, we had to change also the rep structure to own salespeople, very complicated. It's all done. So when the structure is now there, you can also make it very efficient. So it's not what we found out. It's the next phase of this company. So there's a huge potential to reduce the capital which we use. In the meantime, we're optimizing the portfolio. So it means that slow movers are sold out fast movers and we have more stock because we have now also in the top management supply chain specialists, which we never had global. Yes, so you we continuously improve the Albert's playbook to get better returns. So now we can accelerate that. So it's not what we found out. We've always said we have too high inventories, not €300,000,000 that were also people who said that. And we would ruin the business because we have a different model than certain competitors because we have a wide range. 60% of our business is renovation, 60% is recurring business. And it's not only new builds, the most is renovations where you need a broad portfolio. That's our strength. But we can optimize it and that goes fast the coming 3 years because the structure is in place. Fantastic. So it's not what we found out. It's the next step. I'm very happy. How it accelerates inventory, which you don't use, is debt capital. So you have to use it for more CapEx or whatever or innovations or acquisitions. Exactly. So it's the next phase. All right. It's Jaapalowicz from Lucerne Capital. Thanks so much for the presentation. Firstly, on margins, I think for me it's the first time that you're sort of willing to commit to the 25% incremental drop through. It would be very interesting to perhaps hear why you've decided to put out the target today and why do you think that the drop through will be actually higher than in the past? Yes. I think also that has to do with the same journey. I think to bring your company and your business teams in line with your strategy where we come from the last 6, 7, 8 years, where we have a lot of separate companies, we brought them together, yes? So before this is all running, it's all people. You have the management, yes? It takes time. So based on Yes, it takes time. So based on that what you say, I think also the next phase is now everything is in line and also to the management, which is presenting this afternoon. Yes, we have to execute more and drive also more organic growth, because we have the innovation roadmaps coming in place, 3 years ago started, innovations pull through also the other products, so you get an acceleration of your organic growth. That is but you must also look through certain dips or certain spikes. That's the long term trend that we are in. So that's also why you can drive this drop through much better than we could in the past. And we have to set ourselves a target because we really believe that we should do that. I think it internally, it should be Iron at 25%. And first, you have to optimize really the business like Wim said, when you put the business together and after that you can work on the structural cost. So from your perspective, are you now entering a new phase where you've done a lot of investments in the past and now you'll see some of the benefits of that? Yes. In the coming up, I think we saw already the benefits because as you saw the share price in 2008 and you saw in 2018, it is almost triple. So I think we also saw already benefits. But I think this company is in a journey and it's important that it also doesn't stop after 2022, yes? This is a way forward where we go, which will not stop, also not after 2022 because you reach these unique positions, you leverage your equipment more, you are focused more, you use your capital better and that's the playbook. So but you could see it as a next phase. That's why we also took this, yes, not easy decisions because we are all part of the Albers family. And I must say, divesting is not my first goal, but what is my first goal is to give to reach the best returns. Certainly. And then you have to take these decisions also in a disruptive world because this is also based on certain market changes. Don't forget that. There's a lot of changing. When you see our potential in advanced mechatronics, what we can gain there, you will see this this afternoon, but it needs capital. So it's unbelievable what we can gain there, what we see, what we can gain in service technologies with aluminum and also in our company in Southern Holland, where we do aluminum extrusion with service treatments, it's unbelievable what we can gain there. So you have to adapt. And maybe after 2 years again, that's why you are an entrepreneur. You also have to be fair to companies. Let's say, if you decide not to allocate capital anymore to that company, you can do 2 things. You wait until it's dying or you can decide to sell it, discuss it with the management that it's better for them to find another owner so that you can so that the new owner can re inject that company with the right capital because we are going to do it. So then better improve it and divest it in time. All right. That's very helpful. And then on the organic growth, because your target is more than 3% on average. But then you also show a scenario of 5%. I was just sort of That's the same, more than 3% is also 5%. Well, exactly. But and then you say accelerating organic growth. So I'm was curious to sort of hear your view is do you believe that the comp is moving towards sort of 5%, because that's what you're showing? Or I was just curious, are you chosen those 2 scenarios? Of course, our tradition is and that is also what we are. When we say something like that 3 years ago, then our opinion is as a management, let's first reach these targets. And you can every time you can adapt your targets again and make a nice show. But in the end, you have to deliver. So what we are responsible is that we said 2 years ago that we in 5 years we will go through that and that's our guidance. Also people say sometimes where you give no guidance, hey, we give guidance but on a long term or mid term. So that's our guidance. And let's first hit that guidance, not only financially, but also non financially. And this is a learning phase we had last 2 years. You have continued learning phase, so we accelerate and that's actually the message. So let's see, yes? But yes, of course, you don't invest in €140,000,000 €160,000,000 when it doesn't give you returns, otherwise we would really make the wrong decisions. But still you can have dips in certain years or peaks. That's something different. Henk Fjerman from Kempen. Thank you for the story so far. When you talk about capital allocation, an increase in CapEx, divestments and at the same time, you commit to small bolt on acquisitions. I think if you sum it all up, I think leverage is going to drop below 1x in the next 12 months. I think the only statement that is made is that leverage won't exceed 2.5 times, but how do you look at capital allocation with such a conservative leverage base? Let's say we as Wim said, we are entrepreneurs. So we believe that we always have enough, let's say, opportunities to invest in, not only in CapEx but also in bolt ons. So we will continue to do that. And we also always, of course, have an opportunity when there is an opportunity in the market, which could be very attractive. And it's a bigger acquisition that we at least can do that. We want to be in a position where we can make our own choices when the opportunity passes by and that is where we are then. And let's see how it develops. But as we always said, when we generate and it could be, because it's a very valid question, that we really execute this and we first have to do it. But when we when that would all succeed and we would have cash, which we can't utilize enough, then we always said we will give it back to the shareholder. So that means additional dividends or share buybacks, but it's not our preference. And it depends also how is the price, how is the valuation of companies which are in our strategic footprint. We are not prepared to pay multiples which go beyond our imagination. And it happens a lot. We make offers. And even last 3 months, we had a very nice company. And it was even paid double. And now we don't do that. You can trust us. We are not we are looking to our returns. And it's very easy to buy companies. It is very easy, yes, but spend a lot of money. It's always easy. And that's also our tradition of 40 years, which we learned a lot that you have to be very careful before you spend and that you have a very good plan afterwards and that you integrate acquisition well, because that's a lot of work. The 3 we did the last 3 months, we are still integrating them and that you have to finish that. But let me say, when that goes faster now through the divestments or and then we will have number option number 5 or 6, which we always said, but rather not because this question was also asked to us 4 years ago. And until now, we have still the same leverage. So we did still we did acquisitions, but that depends also on opportunity. When the prices are too high, we have no opportunities, we don't do it. But then in the end, we give some money back or more money back, but rather not. But would you maybe phrase it differently, would you be willing to if you divest CHF 300,000,000 CHF 350,000,000 of sales, would you be willing to just have to proceed on your balance sheet in order to be optimistic when the right opportunity comes along? Will that or would you not be comfortable with the net cash position on the balance sheet? It's difficult to cut the targets, but Yes. It depends on the situation. I don't think you can I think my answer was pretty clear? When we have the feeling we cannot allocate that cash, then I think we should not sit on it and give it back. But we want to create value. So when we see opportunities, we will do that. But we will also not overload the organization because then you create chaos. When you do too many acquisitions and you can't integrate them, you create turmoil because acquisition is a lot of disruption in your organization. It needs it's a profession. I must say, how older I get and more experienced, how more careful I become, because it's really dangerous when you're not careful inquiring everything. You have to align it also the culture in your organization. Otherwise, you create a very bad fundament. Our founder always said that the fundament is the most important thing. And when you're not a solid fundament, you can't grow. So you have to always do it on a disciplined way. No deal fever. We like acquisitions, of course. One more question on the I think so far we've discussed the group targets and the rise in EBITA margins when top line growth will commence. But in the past, we've also discussed, I think, capital allocation, for example, material technology, where I think about 50%, forty percent of your total free cash flow was before K plus customer invested in. Since you've done now the bottom up budgeting again, is there is that, for example, a division where you're very excited to grow the margins? Where do you see most going out? Yes. I think this would also be a very good question for our colleague, Oliver Jager, this afternoon to because it was a very valid point you raised at midyear webcast that there's a lot to gain there. But it's also due that we did acquisition and you have still to get the synergies out of these acquisitions. That needs time and effort. It's somebody said this week, it's blood, sweat and tears to grow organically, but it's the best way to generate returns. That is hard work. So when you are not there where you want to be, then you have to put more pace on it and put more attention. Okay. Martin Bergk, We don't talk about the base. We talk about improvement potential over the year 2022. Okay. When I currently look at your selective markets, your top 4, that's 75%. So which selective markets have you merged? Which selective markets you have merged? Because you have 10% that was 100%. But if I look at commercial, all you have was 75%. So for example, when you mean that it's residential commercial buildings, is that now mentioned as one? But I think we will especially in industrial niches, we will really focus much less on certain areas. I think when you have industrial niches, you must think of machine build, which is general industry, but mainly in the machine build. Dispense, yes, very interesting niche. But it's more in the detail where you where we will give less focus. And so yes, so that you in the total will give more focus to lesser teams. Okay. You're merging a number of these markets to 1. Firstly, are there certain select markets you will fully advance? For example, sustainable transportation, you can be on land with a car or with a truck, but you can also be in the air or on the water. Now what we see in these markets happening is a real change to all kind of regulations. A change in voltage in electrical cars is a huge impact on that car. We will explain that this afternoon. What is the impact of that? Because all kind of materials have to change and that has impact on our business. And so we believe that in that sustainable transportation, we should go much more to the sustainable side. That means, for example, how do we reduce the weight of an airplane? How do we use other materials with certain coatings to substitute heavier material? That's huge trends. We get a lot of requests for these kind of R and D projects. So that's what is meant by that. It's an important trade change because you focus really on the sustainability of these positions of these markets. So let me give one example. Certain special manufacturing in automotive, we will divest because we see trends there. For example, because of raw material wishes, which are changing. Therefore, we have been creating the endless value. And we come in a very vulnerable position, in our opinion, in 4, 5 years. And we don't want that because then we lose our margin more. We get more a heavier competitive market environment. So we say rather, we go more to coatings. Because coatings, we get a lot of requests at the moment from also the OEMs in the car industry, but also in aerospace because we have a global footprint. And this is a very specialized technology we have there. So you look again, where is the niche, where is the where are you more and more unique and where you are less unique, yes, you think, hey, I should get rid of that or I should go in other direction. But it's also depending on markets. By reducing both the selective markets and also the technologies, will this also mean that you will change your organizational structure? Yes. That's what we explained. So we will go to more cluster teams, what we already did, but we will further do that. We have also some stand alone companies, which were part of these clusters. We sorted out, you could say, we took out, they report now straight to the head office, so shorter lines and also we want to prepare them for divestment. So we really changed not the segment structure, but we changed in the business teams, we changed a lot. Yes, we already a big part we really did the last 4, 5 months. Also to have closer contact to the end market to make certain companies ready for divestments, but also to have a more grip and more on the operational excellence and leverage. The group activities, office group activities, we'll concentrate all year. So we had some group offices here and there, which we closed or we are closing in the coming 3 to 6 months. And they will all work from here or from their car or their home or whatever. But we don't want to have overhead there. We want to have execute excellence leverage because our strategy becomes more and more clear and also the teams. So yes, the answer is yes. Not big disruptions, that's the journey. Luke? Yes. Luke from Bektte Hoegh, Petercam. Well, first a question about innovation because that will play in a very important role. You talked about raising us from 10% to 20%. So can you explain how you measure that innovation level? And where should the acceleration come from? Is that products that you've already brought to the market that will ramp up or things that are still in the pipeline? Any very big components in it or just across the board, so many small things? I tried to explain it, but probably it was not clear. But the definition we have for innovation rate is the products we launched 4 years ago, let's say, 1st December 2015, and then the turnover we generate with them with these products in 2019 as a percentage of the total sales of that business team, and that should be 20%. And the reason in some businesses we have a higher rate, for example, climate technology can be higher, but like installation technology is lower because you need already to order equipment, which takes you sometimes a year. So that takes longer. But the total average growth is 20%. Good for your information is that we were at 5%, 6%, yes, because we measured that already in a certain while. We are now closely to 10%, but by far too low. But the innovation roadmaps were launched, most of them, because of every business team we made a plan, 3 years ago, some 2 years ago, some 3. So mostly it takes 3, 4, 5 years to get really that yes, that's how long it takes in certain things. But you have that product on the right hand side on the table. That took us 5 years, yes? But now it's very successful. So that's why we came to this 4 year period and to the 20%. And that's how we do it in all areas, in all segments. And where we don't want to innovate, we should divest. And my second question is on the portfolio optimization. So on the one hand, it's divesting things, which probably have a lower margin than average and at the same time acquiring these companies that have a typically higher margin. Can you give me Yes. But most important is it helps our market position and higher margin, but you do that to be better in the market. Normally, companies with a very good market position have a high margin. That is how it works. They have pricing power. They have a leading niche position, so they have high margin. So we don't of course, we buy companies with high margin because we like high margin, but mainly because we like the position that they have. And high margin. Yes. I understand that you do it for a strategic purpose, but to help us with our models, can you give a rough indication about the margin level of the things that you want to digest and typical margin of the companies that you're looking at? No, we gave you direction that it is 0.5% impact on the total. Yes. And I saw that, but that has 2 components and there are many ways I can get to that number, but okay. And then finally, on key account management, that you acquire a company like Flankar, which has a lower margin, but you know in 2, 3 years, I can bring it to more than 12%, could also be. There's so many it's not always high margin, it's not always it's more how do you conquer your market position with the strategy you have. But mostly it's what Arnaud said in my opinion that when they have a good position, they also have a higher margin. But it could also be that it's badly managed and we can improve it quickly. But it is a lot of leverage, yes, because of the combination, it can also make so much synergy. Flanko was a nice example. We bought it with less than 7% EBIT and we really increased it very fast above 12%. But we saw the potential already upfront and we saw that already upfront. And regarding the key account management, I can imagine that the markets that you will now focus on already have a higher percentage of key accounts. Is that the case in At this moment? Yes. I think it's developing pretty fast, but I think it's still an amount which is on the lower side. I think we will see mainly the coming years an acceleration in that. That has to do also with the consolidation of the markets, but also that we have a more global footprint. So we utilize our footprint to do more business with also global players. And there helps also the name Alberts a lot because don't underestimate, we also changed very gradually the usage of our name Alberts, which was very complicated last year. We launched that May last year in this room to our leadership of 100 people. It's just 1.5 year ago, yes? So we are also in that journey, but it really helps. And asked also our colleagues this afternoon, it really helps to get their business with key accounts. So I think we're already improving, but I think there will be an acceleration in the coming 5 to 10 years. For instance, with advanced mechatronics, where you combine different technologies in one team, of course, you have a competitive advantage when you offer that as a team to the customer so that you can work on applications instead of products, systems instead of products. So that you can only do with key account management. So you have co development and you have integration and connectivity. So when you combine the technologies within Advanced Mechatronics, still keeping the local entrepreneur in Mohema, in IDE, which we do, but on the key count, you combine your technology and your offering. That's then you have a double way of success actually. And that is pretty unique what we have. Yes. And that obviously has a revenue effect, I can also imagine that you add more value to the customers, so it also affect the margin. Exactly. You are incomparable. And especially when you're on IP. When you go from products to systems, they cannot compare you with a competitor. That's the good thing. Okay. Thank you. Listen this afternoon to the business people if they use the word solutions or if they use the word combined offering. That's really a trend everywhere. And that's also why you cannot just say we have 4 business segments because these lessons On culture, I think comparing to the Capital Markets Day 3 years ago, you've put a lot of strain 2 years, sorry. You've put a lot of strain or changed a lot on the structure as such of the company. Back then, I think you announced the new divisional structure and want to take a more direct approach from the headquarter. How has that changed the culture within the group? Now you're obviously taking out a lot of revenues, divesting a lot of businesses, which seems to be in a bit of a new direction for the group in the scale. So what effect has that got on morale and everything? Could some long standing Alberts employees say this is not the company I started off with 30 years ago? Yes. It's a very good question because that made it's a very good question actually because it was my worry, especially 3, 4 years ago. And that's why we took such a long time, Matthijs Planken and myself, to migrate gradually to the Abbots name in certain areas because we always say, now you can use the Abbots brand, but you are not forced to use it. And the nice thing what happens the last 2 years is that people grab the name. So you have to that's a very complex process because you still want to keep the local entrepreneurial spirit with the heart. Companies like Mohema, PHH, Apollo in America, they still should have their color in their heart. In the meantime, they should see the potential when you bring things together and you present it to a big ecom. That is awareness. So we took a lot of time for that. I think your question, we passed already, in my opinion, 1.5 year ago with the launch of our company, Passport. And actually after that, it accelerated in a positive way. So I think we took a lot of time and I got a lot of criticism personally from internal, from people, why don't you go quicker? I said, I don't want to go quicker because I don't want to lose my people and I don't want to lose business. So we have now found the balance that you have the local art still in combination when you want with the Albert's presentation. But ask also the gentlemen this afternoon because my colleague, Andre Innentfeld or my colleague, Oleg Jager or my colleague, Maarten van der Zeehn, they face that every day. How do they do that? And it's a very you have to go very slowly and take the time and not ruin things, yes, because we have fantastic brands where we paid a lot of money for. So we should also keep that, but not all the brands, because some are strong and some are but I think we adapted that well. And the same is actually also for this head office. We decided already 4 years ago. And the principle was we don't want to lose anyone who's working with us in MANGRU. And we didn't lose anyone because we took the time. Excellent. Thank you very much. We also took the trend. Which makes you sustainable again. And Arnaud, one for you on the disposals that you're planning. Do you make any calculations on the goodwill? Should we expect any kind of write downs on these businesses? I don't expect any write downs. But let's say, of course, we assume in our model a certain multiple of disposals for divestments and a certain multiple for acquisitions. So that's all taken care of in the calculation. Maybe first a clarification. So you mentioned that you want to focus on 5 technologies and you want to divest €300,000,000 to €350,000,000 in sales. Does that mean We'll just expand the divestment program from €50,000,000 €70,000,000 to €350,000,000 €350,000,000 So we add €280,000,000 Yes? But those technologies that will be deemphasized, those will be completely divested or might some smaller portions remain or will be merged into the remaining technologies? So if I take insulation technology, for instance, I think the focus there is on piping technology, piping systems. Does that then mean that the plastic connection systems that you have within that division will be completely divested or may some of that still stay? No, it's for us also piping systems. System. And therefore, we may For example, we also have some OEM business, which has nothing to do with that core. Yes, that probably going to divest. Okay. So then it's a bit similar to the earlier discussion on Maarten's question on the end markets. Also on the technology side, there will be some segments will be merged basically. No, no. It's not only merged. We also otherwise, we wouldn't come to €300,000,000 €350,000,000 I think you optimize your portfolio. That's what you do. So when your business is Piping Systems, then that is also the only thing in the end you want to do. So that means the things which are not in there, where you think you can't have a position, you will divest. And the same is for hydronic flow control. So hydronic flow control is from source to emitter in the boiler room, and we still have certain areas, maybe we didn't talk about so much to you or to others, but where Richard has no clue with that business. So we will sell it off because otherwise it doesn't get any attention. Okay. Then a question for Arnaud, but 2 fold question on the organic growth and the margin potential. So the 3% to 5% organic growth range that you mentioned, what's the assumed market growth? Because if I look at some of your end markets like construction or automotive, the growth prospects for the coming years look quite modest. And then also The growth prospect looked quite modest. Modest, what is it? If I look at the latest euro construct forecast for construction activity in Europe, which was published last week, take over about 1% growth. Yes. So overall, what's the assumption there? And also in terms of cost inflation, what do you foresee there? And will you compensate for that? Cost of inflation. Cost inflation, so wages, etcetera. Will you compensate for that purely by operational excellence and cost measures? Or will there also be pricing initiatives? And if so, what's then the pricing element that you have assumed in this 3% to 5% range? I think the first question about organic growth is that I think we will show also in the afternoon how our different business teams see their position in the market and what their goal is to develop. And there you will see that we strive for market share growth. So that's one. And of course, for market share growth, you can only do that with innovations. That is also why we push so much on innovations. And the second one is, yes, cost price increases. We always aim to transfer to the market, of course. And again, you can more easily do that when you have a strong market position with the right products that enable price increases instead of a commodity business where you always have to fight on price. So that is exactly the reason because we always every company will always have cost increases every year, which is exactly the reason why we are aiming for higher technology businesses and a niche market position because there you can transfer that to the market. That is what we are showing already for a long time, I believe, when you look at our asset value development, for instance. Last question because I would say last question and then we have also a Q and A session after our strategy and action, otherwise we would miss lunch. Last question. Bidden Burgess, Adelio Funds. Probably summing up altogether, can you is the if you're right, that the cyclicality of Alberts is getting less and less. You mentioned specifically that the semicon area is performing extremely well. We have a great potential. In relative terms from currently 8%, you said we will double this business, which is well, which means that the returns in that end must be superior to your to the average. Still 60% of your business is related to renovation, but you also said it's In building. In building. And 60% is also recurring. Is that end of the business going to be relatively of lower importance in the next 3 to 5 years, which you assume? I don't know if it's maybe of lower importance. It, of course, also develops how quick you grow there. But I think in percentage, we will grow quicker in the semicon area than in the eco friendly building area. But both is very interesting, I would say look outside, look to all the buildings you see and all these buildings have to be changed due to legislation also. So there's a huge opportunity also for energy efficiency. But I think what we try to give a little bit the guidance is that certain areas also due to market developments, like in this case, semicon efficiency. This means the front end of the semicon business where you have the efficiency of the equipment, that there we see a big opportunity. Therefore, we also highlighted now and this afternoon we will explain how we do it. But in principle, you are right. We will we are less cyclical than we were in the past, and we will make it lesser and lesser cyclical because the moment you get unique and unique in your position, you are also lesser cyclical because you have also more branching power. But that's already case of the last year. So answer is yes. Thank you. Thank you. So I suggest we there may be a lot of other questions, but that we do that after the strategy in action session. And please, again, ask a lot of questions because it's only good. But I think we have now to have a break for the lunch, Yes. And then come back at 1 o'clock, we start the webcast again. Thank you. Ladies and gentlemen, can I ask you to take a seat, please? We will continue in 3 minutes. So we have time, but in 3 minutes, we will continue with the presentation. Thank you. Ladies and gentlemen, we really need to position ourselves right now. So please take a seat over for Pete, and then Maarten will pick it up from here. Thank you. So good afternoon. Let me start first to introduce myself. My name is Marc van den Weyn, and I'm responsible for the Alberts Hydronic Flow Control Business. And I want to start my presentation with a few questions to you. Because did you know that due to the growth of the world population to 8,300,000,000 people in 2,030, the energy demand will increase with 50%. And as you know that in 2,050, 75% of the world population will live in cities where it is 50% right now. And did you know the buildings, both residential and nonresidential, count for more than 40% of the global energy consumption. That means a huge pressure on building sustainable buildings. That means a huge pressure on making existing buildings more greener. This calls for energy efficient products. This is demanding energy saving solutions and systems in the heating and cooling industry. And Alberts' Hydronic Flow Control is at the heart of that development. Because what we do, we offer complete hydraulic solutions from the so called energy source to the emitter, Everything in between to reduce energy costs, to improve energy efficiency, that's what we do. Everything between the energy source and that could be a gas boiler or a heat district heating system or, for example, a heat pump, everything in between, we save energy or optimize the system or extend the lifetime of the installation. And we focus our sales and marketing efforts on the whole building life cycle from the beginning to the end, we aim for adding value in all stages, in all phases, in all steps of the building process and the building life cycle. But also during the operational phase of building, we want to stay in touch. We are there from the creation to the completion. But also afterwards, we want to stay in touch. And our after sales offer is containing several options for commissioning and balancing the system, for doing trainings, for doing predictive maintenance, for example, repair servers, remote control, etcetera, everything to reduce energy use and reduce the total cost of ownership for our customers. That's what we call life cycle sales. That's what we call we are at the heart of every great building. And coming back on buildings and improving energy efficiency in buildings. So we have several options. We have several possibilities, different possibilities to reduce energy. For example, when you install balancing valves in a building and you balance your system really well, you can save up to 20% of your energy costs. And by the way, 70% of the buildings worldwide is not balanced well. So huge potential there. I will elaborate a little bit more on a few other examples. For example, air and dust separators and a smart home system that we have. When you look to heating and cooling installations, you always have a lot of air in that installations. And you see here a picture of a radiator. And for example, when you have a radiator with 5% air in the water, you lose 8% of your thermal output. That means that you can reduce your energy costs with 8% again. And beside that, when you install an air separator because there's a solution for that to take out the air out of the installation, you not only save energy, but you also you are protecting your installation against corrosion and you're avoiding noise. Another example is dirt separators. And when you look to a piping system, so to say, there's always a lot of dirt, a lot of magnetite, small iron particles and also disturb the flow in a system. And also here, you can when you install a so called dirt separator, you can save a lot of energy, 9% again. And we have dirt separators in, let's say, small dimensions, big dimensions, etcetera. And also when you store the door separator, you extend the lifetime of an installation, you have less wear and tear, you have less replacements from other parts like pumps and heat exchangers and a longer lifespan of the total installation. And then coming to another example of our products, we developed a complete new thermostat in combination with a radiator head, an intelligent radiator head. And maybe you all know at home, you have such programmable room thermostats where you can program the time that you leave your home and that you enter your home again, etcetera. This new product, this new thermostat is behaving according to your habits. So you reduce a lot of energy because you only give it to hold or to come hot, for example. And then the system is adapting themselves. It's also connected with the cloud. And based on artificial intelligence procedures, we continuously improve the system. And in the end, we save again a lot of energy. Up to 30% is reachable, is achievable with this system. Then we come to a sort of summary of our business. When you look to the market size, our addressable market for our products is around €2,500,000,000 and our market share currently is around 21%, and our goal is to grow to 30%. And beside the tailwind coming from megatrends like urbanization, like CO2 reduction, like shortage of energy, like digitalization, We also have determined some other growth drivers. We offer complete solutions from the source and emitter to the emitter. This is one of our competitive advantages. So we really save energy between the source and emitter. We focus our sales efforts on the total building life cycle. And in many countries, more than 25 countries, we have our own sales force active on the market. And then driving the growth not only by helped or supported by the megatrends, but also we are driving the growth ourselves, for example, by innovations. As we mentioned it already, we launched we are in the process of launching more than 15 new product innovations. So we really believe in innovations, not only in the products themselves to make them more energy efficient again, but also in making the products more intelligent, connectable, talkative. And we also innovate the way in which we sell products. For example, we introduce new business models. We sell not only hardware, but we also sell subscriptions, for example, where we sell the data coming out of our products and make it available for our customers. Of course, legislation is helping a lot and this all makes our markets really attractive. And I think by involving Alberts Hydronic Flow Control in every step of the building life cycle, you can reach substantial savings in energy and also on reduction of the total cost of ownership. We make our slogan of being at the heart of every great building, really happy. Good afternoon also from my side. My name is Oliver Yeager. I'm one of the executive directors and I'm running the Alberts Surface Technology Group. So the question which remains in the air is what are we doing? So what do we do? We do improvement of characteristics of materials in all different markets, whether it's sustainable transportation. We will give already that morning an explanation of what that all covers. It's not only automotive. We do also industrial niches, which could be machine built, could be aerospace, could be power generation. So all what is related to industrial niches, we are at home on those markets. We do that for regional and also for global key accounts. And that's one of the strengths the surface technologies in it have. What technologies are we performing? So we do surface treatment, we do heat treatment, we do brazing and we do additive manufacturing and its post processes To demonstrate a bit the strength of that part of the organization, I have picked 3 examples out of 1,000 to demonstrate that expertise. Starting with somehow sustainable transportations. In the morning, we mentioned already that everybody is looking for electrification in a lot of sense. When you look for vehicles, you could see that we have more electrical applications in cars. We look for autonomous driving. We look for hybrid driven vehicles and also fully electric driven vehicles. So that consequently means they have more electrical power within one of those cars. And that needs to development of a different type of system, which will be the 48 volt system, which you already see in a couple of announcement of the T1 suppliers and the automotive that they changed that system. And that change led to a higher performance demand of the materials being used. So consequently, of that rapid development in the automotive industry and in the T1 supply chain, co development plays a more important role than maybe some 10 5 or 10 years ago. So and that means also the rapid development demand of the market that lets you a decrease of part and model variety. But on the other hand, you have more numbers or higher numbers of parts per individual model. And then you can see the strength of our organization. It's a, the variety of treatments, it's our co development capacity and the huge service network we are offering to that market, which brings us into a position having a more partnership relationship to our customers compared to somebody who's just delivering a treatment to improve the materials with a certain standard product. The second example I have picked is additive manufacturing. You know that everybody is talking about additive manufacturing and everybody is looking for the printers and improving the speed of printers and the quality of printers. But the true to bring that story into the future is the design of the entire process that starts from the pre process, thinking of what offers that technology to future products. It's the printing process itself and it's a post treatment processes. And consequently, the development of the entire process chain is that what people are doing to bring those products as valuable products to the market. And our strength in that chain is the post treatment processes. As I mentioned before, we have a worldwide position. We have more than 70 treatments in the air where we can support the development of that industry. And that is, so to say, that our service treatment is one of the turnkeys to bring that technology into the market. So my third example to demonstrate the strength and future opportunities is the business development, which we did in North America. So some 10 years ago, we have started with 2 locations, 2 service centers in North America, which one can't call that a market position. Over the last 10 years, we developed that to a footprint of train locations. We did that via investment in organic growth. We did also greenfields and we did also specific bolt on acquisitions in Technologies. Wim mentioned in his presentation 3 of them, which we did in 2019 and in 2018. And that brought us into the position to make co development with key accounts, which we do have also in Europe. That means we opened just 3 key accounts in the last 18 months where we bundled our technology. We could do what we do in Europe. We could also offer the same service quality in North America. That development doesn't end. So we are in process to introduce new technologies such as high atherosstatic pressure, which is a technology which you need for aerospace parts, for IGT parts and also for additive manufacturing. That's a very unique and specialized process as well as specialized anodizing where we are an expert or one of the experts in Europe and we will introduce that also to the North American market. If one would summarize a bit what's our, let's say, competitive advantage, which we have demonstrated by the three examples. So we have a worldwide service network and via our locations. We have offer a good combination of different technologies. We have engineering and co development capabilities with our customers. If you then look at the market share we have, the accessible market for us is around SEK6.5 billion. So we cover around 12% of that. We're targeting 20%. So then the question remains in the air, what are the growth drivers? So first is that we expand the technologies we have to all regions where we're active in. We put a focus on regions like Eastern Europe, North America as well as Asia. We expand specific growth areas like power generation, aero, electrical vehicles and additive manufacturing. And the higher demand on the performance of the materials in principle led to more advanced service requirements, which we are able to offer. So if you have a takeaway of that, we have great potential for further consolidation and there's a lot to gain in profitability. I then would be happy to hand over to Andre Innesfeld. Yes. Thank you, Anders. Welcome, everybody, also from my side. My name is Andre Enesfeld, responsible for Airbus Integrated Piping Systems. What do we do? I would like to explain our business and possible you were not aware, but this morning when you were at home, you were surrounded by integrated piping system in your home. And now you are here in this building, and I tell you, you all again, you are surrounded by integrated piping systems. There are always tubes, connections, valves to control and to regulate the fluids and the gases through the building. And this is not only happening in the building, this is also happening in factories and even in ships. Our mission is to create our customers the best integrated piping system and that they are able to create this in a very efficient way and that they can do the job very quick and that the system works perfectly that they also have designed the right size of the tube, the valve and everything so that the energy consumption is as low as possible. This is not easy because our company, where we have a global footprint, we have 120,000 125,000 SKUs. And the challenge is to make the right selection out of these SKUs to create the right integrated piping system. But before I'm going to explain how we do that, I would like to explain you in what verticals we are active and then how we create out of the 120,000 cubes the right integrated piping systems and how it looks like at the end and what benefits it brings to our customers and what makes us unique because I tell you, we are very unique. There's no comparable company with our portfolio and our offer. So we are active in basically 6 main verticals: residential, commercial and industrial, but also in the tunneling and also in shipbuilding and fire protection. And in each of this vertical, we have people who know this world perfectly. And I tell you, you need to understand each of these verticals in the bloody detail to really to do the right thing for that vertical. So shipbuilding is something completely different than the industrial or the residential. The question is now how we are going to create for these verticals the best integrated piping systems. And what we have done in our company, first of all, we have organized all our SKUs we have, the 120,000, into 1 database. And we have the master data. We're working down today, tomorrow, and I think this will never end. This is basically the most important thing for us to make it possible to support a software tool to make a smart selection and to create the best integrated perfect, the best integrated piping system for a certain vertical. And how we're doing that? We are doing that with design service. So we have people who know everything about the different verticals. We also have people who know everything about our portfolio. Most of these people, of course, they are working at Alberts Integrated Piping Systems. And also our customers, some of them do know a part of the portfolio, but nobody really has the full overview. What we have done now, we are creating and the first version is on the way that we have one software tool, which has access to our entire portfolio with some smart selections and putting in the drawings with BIM models, you can create the integrated piping system. And at the end, you get the drawing and you get the bill of material and you have to complete integrated piping system. And this is unique. And why is this unique? Because there's nobody else who has the Valve portfolio complete and on the other hand, the whole connection technology and the fastening technology because that is finally how our solution looks like. And if you see it, I think we would all agree, it doesn't look too complicated. But to get it, it's very much knowledge is needed to make the right selection for the different verticals. And then, of course, the question is what does it bring? What are the benefits? In the nowadays, I think it's everywhere a challenge to do to get the right skilled labor to do a job. This is a topic in Europe. This is also more and more a topic in the U. S. For us, it's very important to have solutions where we save time. With our software tool, we save a lot of time. And by our solution, a full integrated solution, what does it mean? A valve with the connections already integrated from our factory. And within 30 seconds, you can connect this valve to a tube. If you're going to do that by welding, it takes you minimum 10 minutes and it could even take 50 minutes, not even talking about the security measures you have to take because of higher risk. So it's a lot time saving. But it's also because we use connection technologies, new technologies that makes it possible to do the job much quicker. I will deepen this later a little bit more, but if you go from press or from welding to press, you save enormous money and time because of the labor cost you don't have. But you also can do the job with lesser skilled labor. And lesser skilled labor is more available in market. So that's very important. The second point, not unimportant for us and maybe also for some others. If you have a fitting which you use to do welding, that fitting costs you normally about $1 If you use a press fitting for thick wall steel, it costs about $8 Hey, we go from value 1 to value 8. And that is really a fun factor for us, but also for the market. And why is the market willing to pay? Because they save the labor cost And also they have a benefit. So this is for all involved with wind. And the last point, a larger share of wallet. With Alberts Integrated Piping Systems, we are selling not only one product, we are selling a solution. And we also guarantee that this solution is working very perfect, has the lowest energy consumption when the liquid is flowing through the system. And what is real nice to know that normally we have companies who will focus only to sell a fitting. They didn't sell the valve. We're not even thinking about fastening technology and sometimes they were selling the tubes. We can sell now a 1 part jet from 1 to 4 products, sorry. That means we can, a factor of 4, go up with our value in 1 project. So we don't need more projects, we just need to sell more in one project. And that is really another big benefit of this strategy. And now the last one for the whole what makes us unique. You have what I said already to you, you have specialists in the area of valve technology. You have specialists in the connection technology. There is nobody who is a manufacturer in all of this as one company. We are. And due to the size of our portfolio, we also have this database with 120,000 SKUs where they can make the entire integrated piping system off. And normally, this is happening with different manufacturers, different suppliers. It's all out from one source and we give the guarantee it will work. And what you see, our customers really like this approach a lot because it gives a lot of safety for them. It will work. It's all fitting together and it's coming from one source. So one person is helping them to create this system. To little bit go a little bit more in detail in some of the benefits. The first point how we accelerate the business is we sell the entire portfolio in all the regions. But if I go a little bit deeper in the U. S, the connection press technology is a bit, I would say, less mature than in Europe. Europe is already pretty far developed in the press technology area, I would say, 15, 20 years ahead. And we have learned a lot. We have learned how to develop these products, how to produce these products in the most efficient way, and we also have learned how to do it even better. And with this knowledge, we have looked to the U. S. Market, and we have developed the right product for the U. S. To connect thick wall steel pipes in U. S. And we also know how to manufacture these, and we see really this take traction. So what happens, the one region is ahead of the other and we benefit from this. In the opposite, the valve technology is ahead in the U. S, I would say, in our company of Europe, tremendous opportunity. Also here, we will in future make big progress and steps to get more valve sales in Europe and that is, of course, additional. And then again, you sell more value for each project. The second point is the innovation. I think innovation is one of the most important things in our business to develop the business, but also to build the image of a company. A company without innovation is basically a company without a nice face. We see that now we have nice innovations, we really get traction. It pulls the rest of the portfolio. We will continue to do so. We have first successes already, and we will continue with that to develop the entire IPS portfolio that it is really able to serve all these verticals I just showed to you. And the last but not least, point 3, world class manufacturing. Also here, we can conclude that some of the regions are a little bit more, I would say, ahead on automation, how to produce fast than the other. And we transfer the knowledge from Europe to the U. S. To benefit from that market and to do a quick start up of a new way of producing it in U. S. Because our we are convinced, we always want to be there where the market is. We start where the knowledge is, in this case with the press technology in Europe. And then on one day, we will say, now we're going to produce this in U. S. Because we want to be close to customer. And then yes, this morning, you heard already no acquisitions in Aldus Integrated I can only agree on that because we have just 8% market share and we can basically, we can only grow. And I know with all the ideas we have, but even more important, really motivated and strong teams in the regions and very good ideas and more and more traction with the Albus Integrated Piping System, one strategy approach to the market, one phase to the world market, where we clearly accept local adjustments, local things what needs to stay local. So we think a little bit global, but we act very locally. So if something needs to happen different in the U. S, there's no discretion. We do that. Apollo is an important brand, so we do that. VSA is in Europe, we do that. But we will more and more use the Alberts integrated pilot system. So to summarize our competitive advantage, the first thing we are manufacture, but I don't like that word personally. Why not? Because we are much more than that. We are innovator. We are a strong company. We innovate, we design, we manufacture and we market this to the market and we support that by excellent services. That is Alberts Integrated Pipe Systems. And we do that with our entire portfolio. Then we have the beauty that we already have today a pretty good global footprint, a very strong footprint in the U. S. And a very nice good footprint in Eastern Europe and also in Western Europe. And in Asia Pacific, we also have a starting position, and this we will expand over the next years. So fantastic. We can bring our products to the market. The third point, we also made a decision if you really want to bring know how, added value to our customers, you also need to have people who understand your portfolio. And I think you would agree with me, if you have 120,000 SKUs, you need to have people who are completely focused on that because that alone needs full focus. So we did that change over the last 4, 5 years in the U. S. Meanwhile, we have all people on the payroll focusing day and night on our own IPS portfolio. The same we have in Europe, and we also have more and more of this in place in Asia Pacific. And then the last point, innovation. By having more and more people on our payroll from the sales, we also get more and more input from our sales about what the customer wants, what is the problem of the customer, how can we help the customer. So the voice of the customer is more and more coming internal. And that's very good. So we get more and more input for good innovations. That's the first thing. Second beauty is we have the power to drive these innovations worldwide, and that's also what we do. Then we go to the growth drivers. Yes, of course, we are going to sell the entire portfolio worldwide. What we're also going to do, we're even going to deepen more our knowledge about these verticals, because every vertical needs a specific solution. My goal is personally not to have more SKUs. My goal is basically to improve the quality of the portfolio. That can mean we take out some we don't need and we add the right ones. So that's the way how we improve on continuous our portfolio. Then the last point or the third point, the rollout of connection technology, I think I already explained, this we are doing, we are in the middle of it. And the 4th point that we also will continue is to drive innovation. And that together, yes, that means that I think we are convinced, my team is convinced that 8% market share we have today, we will move over the years to 30% or even more. So that will happen because we have tremendous opportunity. We have the products, we have the people and we have a very clear and convincing strategy where our customers are also yes, we can see they buy in and this is very positive. So that's from my side about Alberts Integrated Pipe Systems. Good afternoon. My name is Thomas Breese, and I am representing the Advanced Mecherotronics Organization. Advanced Mechatronics Group has a strong focus on the semiconductor and science industries. 20% of men and 17% of women develop cancer during the course of their lifetime. 76,000,000 people will develop Alzheimer in the year 2030. So what is needed is new and more sophisticated equipment to enable these research activities in this industry. Scanning electron microscopes, for example, just to name 1. But also in the material science, new equipments are needed for the research of cleaner materials, safer materials and new materials. We heard about the automotive industry. Electric cars need batteries. The lifetime of those batteries is insufficient today to say the least. So there's a lot of research ongoing in this area to find new materials to develop and manufacture batteries with longer lifetimes. And in the semiconductor industry, there are many, many emerging applications. Sticking with the automotive industry for just a second, you have in your cars, you have voice processing, you have tons of electronics. There's more electronics in a S Class Mercedes than in a 747 aircraft. There are more and more sensors being put in, into cars, safety systems. And this all is being in preparation for autonomous driving. Internet of Things was also something that Wim already mentioned earlier this morning. Personal wearables, smart and connected homes, but also industry applications like Industry 4.0 are Industry 4.0 are driving a huge demand in these for these applications. 5 gs is right now being discussed all over the place, wireless communication, wireless components, but all the infrastructure is driving that market. And there is artificial intelligence, huge, huge computer with unbelievable computing power needed. Data centers and yes, cloud infrastructure are all markets or applications that are driving the semiconductor industry that we are participating in. And what do we need or what does the industry need? They need efficient semiconductors. They need efficient semiconductor devices. That's where the semiconductor efficiency is coming from, yes? Because higher functionality, less power consumptions of those microprocessors, higher speed obviously and even smaller and smaller devices to be put on one chip. There are over 20,000,000,000 transistors today on 1 microchip and that number is growing. So that's what is defining the FRENK. And in order to enable the semiconductor manufacturers to do all this, they need new equipment. They need more advanced lithography equipment. They need process equipment and they need obviously inspection and metrology equipment for the process control. And this is where advanced mechatronics commands. We are delivering leading edge production and technology, in most cases, tailor made to our customers and prepared for the future for the next generation ship manufacturing. Thus, we are enabling them to meet not only their technology, but also their manufacturing roadmaps. We are specialized in vibration isolation. You can imagine if you are talking about 7 nanometer technology nodes, that is almost nothing. The hair is growing 10 nanometers in one second, so 7 nanometers. And you do the line in spaces on a microchip and the next line to each is 7 nanometers gap and then the next line only 7 nanometers thick is next to it. And if there are some disturbances, you have a connection, you have a shortage and then the transistor is not working and then the chip is not working. And then yes, you have an impact on yield. So this vibration isolations come in, but we also do ultra clean, ultra high purity parts and fluid systems for gas mix cabinets, for example. And we do large, accurate precision frames and vacuum chambers for the industry, for the equipment manufacturers. So our competitive advantage is system design and engineering capabilities, NPI engineering capabilities, so the expertise for new product industrialization to bring them from prototype or pilots into high volume. We have supply chain management expertise in the organization and a lot of people that know the industry and have expertise there. I approach you two examples today, where we describe on how we want to put or how we put our strategy in action. The first example is an example of consolidation of consolidating the supply chain. There's a lot of consolidation going on in the semiconductor industry as well as the semiconductor equipment industry. So larger customers also want to buy from larger suppliers. So there is a huge trend to go to fewer and larger suppliers in the industry. And the larger supplies need to have a certain size and critical mass to cope with the demand of the customers and that is where Alberts is coming in. What you see here on the right side of this presentation, this green module, That's a machine conditioning, monitoring and control unit consisting of 24 individual modules supplied and shipped by or provided by several different suppliers, shipped to the customer and then assembled and tested and integrated at the customer side. So the problem was obviously high lead time because there is a huge amount of test time involved. There is was a high failure rate because you find out in the customer factory if the modules once they are merged together, if they are working or not. And it was also binding quite some capacity of the customer for a customer So what does the customer want? The customer wants to focus on their core competence and outsource more and more non core devices, modules, subsystems, etcetera, to larger suppliers. They want to reduce the lead time. They want to reduce the failure rate. And obviously, all of the driver is the cost reduction in this industries. So advanced mechatronics is and was capable in this example to meet the critical competences that are necessary, engineering and PI as mentioned before, but also supply chain management. And we co developed this solution here for this customer and we had a local presence, which is therefore also a key advantage of us when you talk about development or co development. And what we did, we basically transferred and in sourced and improved the supply chain and we created, which you see to the far right where you see the operator, track and play the mask and the device best in qualification than 20,000 from the system engineers to and so consists of actuators and vacuums flow monitoring test for the customers managed lead time, but more than 80% we accelerate, we had a performance and we achieved result. To meet, there was a measure in the second example is an exchange managed and curing this integration. This is the X-ray chain that prepared to meet the demand. So the customer was looking for cleaning submicron, but also looking Why? EBM Welding manual process was achieved in this group about manual welding products that we are talking about. And because of the information happening, again, the CASK core competence development partner for them to enter ramp, Tekuron obviously provides for advancement to do early process, for example, license for the much higher reliable controllability. We invested in and baked out a great area. We have received the benefits in terms of competence, process with significant and yes, increasing complexity roadmap of this customer with co development and new innovations from advanced MESHOTRONICS. This is the last slide to summarize our competitive advantages. Again, we are specialized in certain technologies: vibration isolation, ultra high purity fluid systems, large precision frames and vacuum chambers. We have our own intellectual property. So just one of the organization that is part of the Advanced Meschatronics has more than 50 patents of product families and over 100 patents worldwide. We are continuously putting our capabilities or capacities in new development, new products, new owned products. And we have the investment power of Abbott's and Abbott's brands, which is important in this particular market segment. And the combined offering to work with the customers for co development on a global basis is a key advantage that we have. So you see here today we have roughly 8% market share of a total addressable market of €2,700,000,000 and we intend to more than double this over the years. And what are the growth drivers? A, we want to increase the market share with our existing customers, obviously. That is a given in the current product portfolios by following these customers in their global manufacturing areas or footprint. A lot of this manufacturing is going to Asia and Wim mentioned it before that there are opportunities for us to follow them and have local manufacturing in Asia. But not only that, we want to penetrate new OEMs. They are in the U. S, but also in Asia. And in order to penetrate new OEMs, you need to have local engineering that is also key engineering and manufacturing throughput. And we expand our portfolio to reach this global footprint with acquisitions or greenfield like also mentioned earlier. And we will focus on technical co development with our customers and own innovations within the Advanced Mechatronics Group. Yes, ladies and gentlemen, for the day. So hopefully, you get some insight in the businesses. I think what we discussed today, we could say as a key takeaway, allocating our capital in the most efficient way, and that's very wise to further narrow the focus. I think also after listening to the presentation, you see what kind of potential we have and also that, that needs capital. Our aim is to achieve unique leading market positions with sustainable impact. And I think that's very important because a lot of money flows in that direction, sustainable transportation, but also semiconductor efficiency in the medical area or wherever it is. I think that's really supporting our business as a megatrend, which is shaping our future. To build an even stronger and better average, we will accelerate organic revenue growth, mainly in the 5 areas, where 4 of them were presented, and we realized an operational leverage excellence with a drop through of 25%. Therefore, we will accelerate our portfolio optimization, that means we will increase our divestments, increase also the attention for inventory reductions. So it could be that 120,000 SKUs should also be a little bit less as long as we have the right SKUs and we further focus, cluster and simplify our organization, because I can't tell you how important that is. The more you are simplified, the more you are focused, how better you can perform. So that means we change reporting lines more to Utrecht and also we drive more the businesses with our KPIs. As mentioned by Mark Horik, operational leverage, excellence mainly drives the EBITDA percentage increase, which is one of our aims. So we should drive also this leverage and excellence. And efficient capital allocation is proven also by our model, but also I think where we really allocate the money is really driving our return on capital percentage increase. Nevertheless, you are living in a world where certain end markets also have their own development, but when you look through that development, this is the long term creation of shareholder value. So we think by taking these measures that we really evolve into stronger and better outputs and we already started with executing these initiatives. So I think we still have a lot of questions left, and hopefully, we have So I would like to invite my colleagues. So maybe to introduce Maso Abenaeys. Maslow Arbenijs is responsible as Executive Director and part of the executive team also for industrial technology and also advanced mechatronics, but also dispense fluid control. So when you have questions to him also, feel free. So Martijn? I'll start off again. Martijn Lejev, ABN AMRO. To start off with Advanced Mechatronics, a question from Mr. Bresser. Can you elaborate on what is missing in your portfolio given the remarks in the presentation? That's a good question. Right now, we are very good positioned with the 4 companies that are part of the Advanced Visualtronics organization. We mentioned today only vibration isolation and ultrahigh purity gas systems and the large frames. We also have others within the organization, other capabilities that are helping us to have the position in the industry that we currently do and set forth. There's always something that you can add to the portfolio as it is today. Okay. I'll switch then to Installation Technology. Mr. Hennefeld, Playing the devil's advocate, you mentioned that your solutions are unique. But can you elaborate how your Evolv and connection technology is different from that of Uponor and Viega because as far as I can see, they have exactly the same combination? Yes, I can comment on that. It's the portfolio, including the valves, the fittings, the tubes and the fastening. This entire portfolio out of one source, that is what makes us unique. It's not that a single product makes us unique. It's the entire portfolio what creates the IPR solution. But I understand that you have an elaborate portfolio, but Yes, that's the difference from Uponor, clearly different. Uponor is very much, yes, a focus on the cost of Clearly, you're working hard on the inventory bit. You've mentioned growth with activities with global accounts. You're going to focus on increasing key accounts. That obviously has a negative effect on accounts receivable. Is there maybe a material portion of the positive effect in inventory undone by an increase in receivables given your focus on key account management? To whom is the question? To me? To you? Yes, you let's say a portion will be, of course, compensated by increased financing because of longer supply chains. On the other side, given the efficiency improvements that we make also in our warehousing and logistics, but also in our manufacturing footprint, we believe that we can also still make a lot of wins there. So we still believe the total combination, we can really win a lot in working capital also, especially in the installation of the business. Okay. Thank you. And by having a bigger portfolio, you also have more pressure not to, let's say, extend your payment term so we have much more power. So it's not in principle when you have a key account that you have a longer payment term. It can also go the other way. Of course, they're trying always. In the presentation on hydraulic flow control, the term or the phrase life cycle sales was used. So can you elaborate on what portion of your business is generated outside of the initial sale or the initial installation of the products? How material is that for your business? And maybe Arnaud Win can talk about how significant is that is for the Alweds Group. No. At least there's a significant part from our business. But of course, also renovation of, let's say, existing and refurbishment is a big part of our business. So we focus, let's say, our sales efforts on the whole building life cycle from the beginning to the end, so to say, and it's fast growing. And especially when you look to all the, let's say, the tailwind coming from megatrends and the legislation, so that is helping a lot to grow that business. But of course, you'll still have a lot of over the counter business. You have to replace, for example, expansion vessels. Yes, you can talk about life cycle sales. And of course, we want to replace products that we supplied, let's say, 10 or 20 years ago with our products, but it's not real life cycle sales. But still it's not clear to me what part of the business is then really product sales and which part is more services or other type of No, we aim at least for more than 40% of our sales coming from project sales, so to say. I think you mean project sales or product sales? Products, yes. Versus other services, you mean services? Services is still a small part of our business, of course. We just started, for example, with, let's say, selling subscriptions. We just started with that. So it's still a small part, but it will grow very fastly in the near future. And I guess also growth is still at small portion? Yes, below 10%. Below 10%, yes. At more than 0. Somewhere in the middle maybe. I think it's the point is that it's starting and there's a big opportunity towards the future to develop it. And you see more and more that you get integrated solutions where you have combined hardware and software. But I think it's somewhere below 10, maybe between 5, 10, something. Derek, please evaluation capital. Mr. Pelle is my question, but basically reflecting all the ambitions we've seen on market share increases, which look quite promising, knowing that it's all about 50% increases in absolute terms. What time frame is attached to those targets? Probably not 2022, but what can you share with us what you've seen, let's say, over the past 2, 3 years in launching new innovative solutions? And what kind of gains you've seen and said it's a quantified target, but what time frame should we see in this respect? That's right. Of course, we I think it would be a dream of realizing that in 3 years. But I think what you when you run a business, it's one of the most difficult thing is the question you ask, yes, because you have so many things where you yes, what would influence that. It can be that you have other customers, other contact person or an innovation is not going so quick as you think it goes in But of course, we made our plans. But of course, we made our plans. We made plans for this. We have also our own time frames. And let's say, it's not 2022, but what is exactly? Let's say, it's as soon as possible after 2022. But we can't give there any years because when I would say 4 years or 5 years, I could not verify that. But when you would ask me, hey, could it also accelerate the coming years due to certain megatrends because your organization is more fit for the growth, because your structure is more in place, because you allocate your capital much better to these businesses, then my answer would be yes, because that's the whole essential thing of today and that we really have chosen for, let's say, 5 things where we didn't present fluid control because we thought it was a little bit too much in the presentation, but we will show you that in the afternoon. But all these 4, 5 things, we really think when we allocate more our energy and cash to that, we will accelerate also the growth despite dips or peaks in the environment where you live in, which you always have. So that would be my answer. So actually I can't give you that answer, say, 5 or 6 or 7 years, but I think it will accelerate, especially in 2021, 2022 because a lot of innovations come then more to, yes, to how do you say that? Yes. That they are more adults in their introductions. And that will continue. And that's also important. It will not stop after 2022. Because probably hopefully, we are sitting here again after 2 years evaluating the coming 2 years. And then we say, hey, what is now the situation? Is it really accelerated? What we expect. But putting a real number on it, I can't do because yes, it's difficult to verify that. And maybe on part of your answer that you said you have ups and downs in the market, but what is your view on the outside world today? Let's say, how do your clients position themselves for the next 6 to 12 months? Is that a generally positive view that you can say, okay, 3% organic growth is achievable or has become, let's say, for the next 6 to 12 months to the amount of visibility you can share with us? Yes. And I, of course, you also know, Dirk, that we can't say too in this period of the year. But what we also said midyear is that we said, hey, we have given some guidance about what we see in the markets. And we also said when you have a lot of uncertainty in the markets and that we will also be, yes, part of that. So because when you have CapEx driven business and the CapEx is postponed, then you will also have your own postponements. Now we have seen that. We have also said for us a big question mark was the industrial U. S. Markets, where we had a lot of quotes at midyear. So what we saw due to the uncertainty, also certain postponements. Of course, you also know what happens in the German Automotive and Industrial certain tick up in, let's say, tick up or pickup. I even made a mistake there during the presentation, tick up, pick up during the end of the year. We have seen this tick up, but it was slower. And let's say also a little bit later than we expected, but we see it. It is mainly due to inventory reductions. It's more and more, yes, let's say, done. But still, this is a volatile world. Also when you look to the U. K, so also that is we are facing that situation. When you look to the coming 6 to 12 months, what we said also already earlier is that, for example, advanced mechatronics, semiconductor, we really saw an improvement in quarter 4. Also there, you see, yes, it came a little bit lower than we later than we thought, but next year will be very good. So actually, a little bit the same as what we said midyear, but a little bit later and a little bit lesser tick up than we maybe thought that time, which we also already said in September, August. It's very difficult to predict. That's also why we don't predict because we would like to do what we say. And when you don't know it, you don't say anything. There are a lot of people who say a lot, but then they have to correct it afterwards. We don't like that. So what we like is that we give you guidance about the coming three to 5 years because this is not only 2022. And actually, I also think we should not be so negative because also when you look for example to Germany, that situation will also change again. I think it was maybe not a very easy year in Germany in certain markets. And it could be that also the beginning of next year is a little bit the same. But after that, when you speak also to certain customers, it could even improve again. And so but then it's still 2020. We are not busy with quarterly trading. We're not busy with we're busy developing and creating value for our shareholders. But of course, we are also not immune for certain market developments. So yes, it could also be that the mix is then a little bit different, yes, that in certain markets you grow faster. And let's say, in Germany, in certain mature technology activities, where we have a high breakeven point. You are a little bit more vulnerable also in your profitability. But yes, you have dips and you have peaks. In the end, you develop the company and you develop your long term growth. Plus, you also have responsibility to all your other stakeholders. I think a very important topic for these times is also your people. When you would ask me what is the most challenging topic for the coming years, that is attracting the right people and keeping the right people. That is really for me the biggest challenge. The markets are there. The potential is there. But we're having the right bonemci. The other word, we can't tell anymore in Holland. The money, the money. You need to attract the right people and that is so important. So we also give today to you sort of image of ours that hopefully we attract very ambitious and learning people. So but we are not even for the day to day at the moment. Hopefully, I gave you a little bit information. The next question? It's okay. Yes. I've got a follow-up question on the semicol business because also the predicted growth is quite high. Can you give us a bit more background of how the business mix looks like? So how much client concentration risk is there? Probably a lot of semiconductor companies, but I think also medical equipment makers, the geographical split. So is there a huge concentration? So is it relatively easy for you if you wheel in another client? And if you are in a partnership, you're not only doing one project, but you probably specced in for a long period. Can you give us a bit more background on these dynamics? Well, the semiconductor equipment industry, which is what we are talking about and what we are targeting, is not that huge, right? So you know the players in the market, whether they're the lithography side or the process side or the metrology side. And yes, we have we are in contact with all of them and we have a very good position there. So if you have 1 or 2 of them consolidating or merging, then obviously this is also bringing always bringing opportunities for us going down the road. Yes. But it's not the case that ASML is currently 70% of the total revenue of the semicon business. Semicon in total or is it? In that's the concentration risk or the top five customers are 80% of revenue? Well, there are analysts out there that are looking at this particular market, whether this is Gartner, Dataquest or VLSI Research and they cluster the semiconductor equipment market. The front end wafer fab front end market is roughly like USD 500,000,000,000 And you probably know since ASML is a public company what their current share is in this €50,000,000,000 plus then you get an understanding of what the market share of an ASML, for example, is. That's also what I'm asking. I also have those that kind of data. But you are saying the concentration risk of the semi business? I think when you have 5 or let's say between 5 8 bigger customers, I think there we do, let's say, 80% of our business with Parcel, roughly. Yes, correct. That is a little bit of situation. Yes. And if I can add on that because Advanced Materials is not only Semicon. Semicon is one of the markets, but we are also involved in medical, in coatings, printing. So that's not the only market that we are in with our product lines, so to say. We have much more opportunities than only the semiconductor market. Okay. But you're right. I think, of course, our colleagues in Holland, in Veldhaven are a very big partner. But I think roughly we have 5 to 8 customers. And that's also logic, yes, because these OEMs are pretty big. So we work also with, yes, I don't want to say the names, but customers in Germany and in Singapore, where you have the same footprint where you can do the same footprint. Therefore, I think Asia is so important for us also to get bigger at other customers. But of course, AS and L is a big partner. That's correct. The preparation phase takes years before these customers say, okay, you are my preferred supplier. So is your optimism coming from advanced stage of these kind of tariffs? But the business plan is based on several customers and customers we have, not only ASML, of course. But it's I think the trend in the market is that there was already a tremendous consolidation what Thomas said and that they're growing all so fast and that's the trend that their problem is the supply chain. That is actually not only happening in semi but we see it also in the beverage market. We see it also in the automotive market, where you see now with the car manufacturers that they reorganized last week 10,000 people at 2 big OEMs in Germany that they fire. So they do that to create space for their new developments. So they will also have more co development companies to help them, discuss for service technology. So it's really a trend. So when you therefore, I we also think we have to decide now because, oh, you go with the wave and you really take your position or you can't follow because you can't allocate the capital enough. That's why we made these decisions. But your question, 5 to 8 customers have 80% of Perfect. And then besides that, Marshall is right, we have other markets and only semicon advanced. Thank you. Okay. Can I ask a quick follow-up on semicon? We know ASML is important and they're already ramping up EUV. Is that something which could be so meaningful that these outsiders could see that into the numbers if EUV reaches 40 to 50 shipments? What is the question? Well, if that could be a real meaningful contributor on your average group level, if like EUV reaches 40 to 50 shipments in 2 or 3 years' time. Yes. We are in EUV. So yes, the moment it goes from 20 to 40, we will follow. It's a simple math. But that's also why we're very positive about next year, Marcel? Right. Yes, it's a simple math. And but it's true. But would you willing to quantify that impact? Because we obviously don't know What is our revenue per EUV? Well, something like that. We give every time the same answer. We don't disclose that. And that's great. No, no. It is also we have to also to be careful towards our partner. And then one more question on semi colon. Like would you be willing to sort of share anything on margins? Is it better or worse than group level margins? Then Albus group level? Yes. It's part of industrial technology, so it's higher than Albus group level. All right. That's very helpful. Very helpful. It's a very healthy margin, but I still think we can further improve because also there you have the leverage. But also food control is very interesting. So I think they are both interesting. It's not that one is doing now so much better than the other. All right. That's very helpful then. Absolutely. On Piping Systems, do you see any changes on the distributor side of the business that perhaps like Amazon is becoming more important or that whole landscape that the supply chain is changing? Well, let me say we cannot close our eyes what's happening in the world. I think our main distributors all are in the topic, and they prepare themselves to cope with that, yes, let's say, a possible threat to them. What we do is we manage that we are ready for whatever happens. In our case, that means we have not to take care only to supply the right products, but also have always our data available to plug in whatever channel that's going to happen. So that is our position. I don't believe personally that it will change rapidly in our business because still we are existing wholesalers, they do also a lot via e commerce. Some of them already do more than 60% of their business via their e commerce platform. So they're almost Amazon, so to say. Yes. And what is very important, I think, also to add is that they also use brands. They use more brands. They use more brands, to also on their website. Yes, completely correct because the brands That's what I learned from you. Yes, creates the pull. That's the request and you say that you can say that the bigger Vulture channels also prefer to have a private label, where we, of course, prefer our own brands. So that's a kind of balance act. And what you see is that channels for the Internet always like to use the brands because there is demand and there is the promise of the brand and it stands for quality normally. Fresh innovation. So the moment you have innovations, they need you. Yes. So it can actually, it's my opinion also a big opportunity for innovative companies. But when you don't innovate, you have an issue because then you get compared to other things. So you have to continuously to be very innovative with your package and your products and your services. All right. That's very helpful. Yes. Also, that needs more investment, okay? Master data, it's all investments. We need to take that position. Martin Baker, J. D. After lunch, we had 4 presentations about new technologies, about strategy, addressable market share. Maybe because it was affluent, but I think I have missed one about fluid controls. Is there any reason Yes. I just mentioned that because we sold 4 was already a lot in fluid control. We have 2 experiences instead of 1, the rest. So the people can tell you a lot about fluid control. So we try to divide at the time. Otherwise, we would not be able to give the experience. It's more a time issue. And concerning hydraulics, it looks like you have a system which is competing against NEST. When I saw one of the pictures. Why do you compete against NEST? What do you think you have to offer Or are you also more or less making a system which is compatible with NEST? Yes. It's more or less comparable, but also we really can learn more about it during the experience later on. But to be honest, let's say, our product is much better than the product called the You because it's adapting, let's say, the habits of the resident of the home, for example, and Neste is not able to do that. It's still a programmable, of course, connected with the Internet room thermostat, but our product is much more. We would like to learn you more about that product later on. So how what's your route to beat NEST in this respect? Because respect. It is probably just a part of our complete product portfolio, so to say, and it's not our aim to beat Nest, for example. It is more our aim to complete and to offer complete product portfolio, so to say. With all the other features, is NES compatible with all other services you offer? With all the products you have, but also compatible with a NES system. So it's not No, no, no, no. The NEST offering is only a small part from our product portfolio, so to say. Thanks. Sondre, Kempe, Capital Management. A question on the regulatory environment. So in one of the presentations, we learned that there's quite a bit of low hanging fruit left when it comes to energy savings in terms of, for example, the turrets in the pipes and the air in the pipes. Is there any regulatory changes on the horizon that force people to install this kind of equipment going forward? And the same question is when it comes to safety standards, I think a lot of regulators like it. So really, of course, increase the bars when it comes to accidents, etcetera and upgrading all piping systems, etcetera. Any tangible movements in terms of tighter regulation, which is beneficial for you? When I look at the legislation, for example, there is no legislation that is saying, hey, you have to install an have to get a C label before 2023. And that means that you'd have to do a lot in energy saving. And you cannot reach that without, let's say, installing products like air and dirt separators. Not only that, you have to do more, course, but air and dirt separators and also the more intelligent ones can really help you to reach the goal of, let's say, getting an C level for your building. The other question I didn't catch. So for all kind of safety for tunnels and I think there's a lot of stuff where we've seen recent accidents where No No, no. We do not really play in that field of the market. We mainly focus on buildings, both residential and non residential, but not especially on tunnels. It's more the business of integrated piping systems. Yes. And we follow the legislation there. So there's nothing special known by me now that something is popping up. But if it pops up, we follow. Answer this. Yes, before I move over to material technology, one question that interests me is when I looked at integrating piping systems, I discovered there's still a lot of brands that are used among across the several geographies. You looked at the website? Yes. Many websites as well. I think a lot of websites are still in the air. Like is that also the way forward? Or is it time to maybe No. What we clearly see is that we will enter finally with, I would say, some power brands linked to technology. So if I take one brand in my area, Apollo, it's very clear it's the power brand in my business for valve technology. If I take another brand, it's a Fierze. It's also a very strong brand. And yes, we also have a regional brand where we say it's a very strong brand in certain regions, U. K. And the Middle East, for instance, Pekla. So is it we go to lesser, but at the end, we will continue to carry brands where, of course, we see the value. But at the end, we also see that our roof, our integrated piping system gets more and more traction and the people more and more recognize that. So at the end, I think over time, it will more and more be connected, the brands to our integrated piping systems. Okay. That's So it's still a work in progress. So it could be that you see some also Adi's questions. But also but I think there's also still a lot of work to do to get it all completely finalized. Plus, as I explained, we migrate step by step to the situation. We don't want to lose the heart of the people in the in Apollo or in GSH or in Pega. I think more and more the people understand it, completely follow it. So now you can implement it step by step without the question of Felix, without losing the people because that's it's the last thing we want. Yes, clear. On Material Technology, I think the growth in the business has been about 3% for the last 6 years or so with very limited margin expansion. Now talk about quite aggressive market share gains with introduction of new technologies. And is it now the time to do that given that you are quite unsatisfied with the margin you make in your existing sites? And another question I have on that is, in the U. S, how many service centers would still like to open? And do you see opportunity to acquire these sites? Or will it be organic expansion as of now? Coming to your question number 1, are we 14, beginning of 2015 that we acquired the company Impacron, which has a wide range of technologies and a wide range of sites. So we continuously improved that. So we had a marginally acquired the company of below 7%, so which is right now above 12% in average. So this is the general improvement of margins of that company we have acquired. Are we satisfied with what we're seeing today in the numbers? No, we are not. It's a continuous way of improving that. We learned today that we would think a bit about what are the right technologies? Do we keep all of the sites and all technologies we have? Yes, maybe not. You could see that slide we've done presented with the deconsolidation of the sites. So there's also some reduction of service sites. So that will be one of the actions we take to have a more stringent focus on what we are doing. Looking to North America, where we had the development from 2 to 20 5 at the moment. Yes, we are constantly evaluating whether companies being on the market, whether we could acquire them or not. We have a good setup at the moment. For next year, we have a strong focus on, a, integrating the acquisitions we had done, that we do a bit of transfer of technologies, which we have in Europe, which you would like also to have in the U. S. I mentioned 2 of those. It's Hipping, which is in process to get there implemented. And the other technology is anodizing. We don't do that in North America. But if you look at the key account structure we have, which acting in Europe, in Asia and also in North America, so there is a demand for anodizing in sustainable transportation, but also in IGT as well as in aero. So we could implement that technology. Would you see that in numbers in 2020? Yes, potentially not because investments that takes some time to get that converted, but this is what we're aiming for. So if I understand it correctly, it's more about acquire buying new machines in the existing sites and then add the right skill set and then targets the key accounts associated with that kind of technology or maybe already have some relationship. And then to get to 12 to 20 like maybe half is done that and the other half is maybe like add some more sites and maybe grow a little bit of a thicker nation wide footprint in Europe and the rest. Is that how you should look at it? More or less. Like more or less? Yes. Okay. It's clear? Do not forget that before we acquired in Praklon, the Service Technology business, there you talk about, did not mature technology, yes? There's still some things and maybe you would like to get this. But Surplus Technology had already 14.5 percent EBIT in 2014. So I think in Preglorn, which we still think was a good add on, especially also in America, it gives us the footprint which we have now, but it also threw us back in our margin. So as we're coming there, we're coming here. Oliver is coming here. Last question on Advanced Mechatronics. I was quite surprised how outspoken you are about consolidation in the industry and maybe acquiring a sort of a new Ford lag on the business when it comes to like the certain products. But which like what kind of products are they then? I think what the question was asked before. But I think when your show has spoken, maybe you could give a little bit more color on that. Like what kind of knowledge is there then in the organization that is not being fully utilized at the moment? Well, it's not so much about knowledge. I think if landscape, there are a lot of mechatronic like advanced mechatronic like components that are going in such equipment and such a tool, yes? And it's part of the growth strategy obviously to look at that, yes? But it's not only the technology and the product. We are right now set up with the people, with the customers that we have, with the key account that we have, with the products that we are currently serving and the combination of making subsystems with different kind of individual products. That's how we want to achieve this growth. And rest is potential add on down the road. Felix Veenan from SFO. Two questions. The first one to Andre. I think driving the share of wallet and selling more complete systems has been a project that you're on since the last 3, 4 years now or even longer. I think the initiative makes a lot of sense. But can you share some of the progress that you've made over the time or also some of the challenges? And in particular, on the challenges is, I think, again, the idea is convincing. But in the end, how important is price for the customer? At the end, it all starts, of course, with the right solution. And our products we use in our solution needs to be as such stand alone also competitive. And should I on I comparable, they should be same or better than same or better than the competition. And this is also how we strengthen our position. If you ask me what progress we make, I think we make some very good progress. But also, honestly, it takes always longer than you think before. What I see is that our sales team more and more gets the message across to our customers, and the customers also understand it and more and more also use our organization from them for they are coming to us and ask for the solution. And for instance, our engineers in the back office, they engineer an entire IPS system. And sometimes, just to give a little bit idea, they are working 2 weeks on such an entire system for 1 big building. And yes, that shows. And then of course, we put all our products in there. So that is really happening. But it starts actually success starts small, and the success creates another success. And that is now what we are seeing what's happening. That happens as well in the U. S. And we also see we more and more get also these kind of, yes, nice projects in Europe that we bring the whole system into a factory into a new commercial building. Okay. Thank you very much. And then to all of you, but especially to Wim and Anno, we spoke a lot about megatrends today, about things like sustainability, future transportation and so on. We didn't touch a lot about digitalization, which was a bit of surprise. So can you fill out that work for us? And how important it is for you as a group on the one side internally, and here I talk about CRM systems, SAP, etcetera, etcetera, and then also outside towards customers and how you want to like to give Maarten a word because I think we talked a lot about digitalization. But maybe to explain it Maybe not enough. Probably not. Was not clear. It could also be Yes, of course. In Hydronic Fog and Zol, we have a specialized digital lab, so to say, I think, with in total 15 people in it, working day to day in making our products more intelligent. That's, of course, let's say, our long term goal because that takes, yes, a lot of time to realize that, but also in creating new business models. I'm sure the stipulated, let's say, the possibility of selling data via subscriptions. And we just started with it, and we really believe in that. But we really work hard on it to make that, let's kind of products and subscription models available. So we have 15 people working on, let's say, digitalization. And also in future, we want to offer, let's say, commissioning. I talked about commissioning, how can you commissioning your system, for example. We also will make that available via the Internet, for example, and we are also working on that. So that 15 people are day by day busy with the whole, let's say, digitalization process. And then internally in terms of processes IT? Yes. Let's say, you mean the process in our company? Yes, let's say we I think also Andre touched and point to that, master data. We are focusing a lot on that, and we know what that is actually in almost all cases the basic, but you need to have that organized well before you can really digitalize your also your services to the customer. Because whatever you want to show to him, you have to have standardization in pictures, in product types, in all kind of things. So you need a lot of master data to organize that. And all the teams all the business teams have an IT road map, like we have an innovation road map. They also have an IT road map. And those IT road map is aligning, let's say, the business. It's not per se necessary that, for instance, advanced mechatronics is on the same system as integrated pipe systems, but it is, of course, important that the companies and groups within integrated piping systems are aligned together on at least an aligned system. So that's what we focus on and what is also giving you a new opportunity for the future. I think we invest a lot in IT systems for each business team. So a lot of processes running at the moment. For example, advanced mechatronics, but also dispensers then afterwards starting. Hydronic Flow Control, we did already a lot. Busy, we are in integrated piping system. So per business team, I think we are already 5 or 8 years busy on the structure within service technologies, which is very important, to align all these 90 service networks. So think we never spend so much money as the last years and the coming years to yes, it's more but it's what Arnaud says, it's related to the business team. We will not have an IT system for all our hours. We have our KPIs, which we do with a sort of shell. But I think it's very important for the future that you have very good information, yes, also to be connectable to certain new business models. And that was our driver also. I think that is also the, let's say, the opportunity that Abert has. However, the world is digitalizing. Of course, our products, because we identify digital product and digital services, that makes sense. But all our products, I think the digitalization plays a big part, big role. You will see some examples also here in the afternoon with the innovations. Products have to be communicating, connected to systems. So valves have to be closed and opened from a distance, these kind of things. So that is crucial that you, of course, develop there. There, we can share and learn from each other. That is also what we explained in the past with our networks, where we bring the people together that are dealing with these digitalization of products so that we can learn from each other. But on the other side, yes, you have the sales the route to market with traditional wholesale business and of course, the Amazons and the digitalization of services, I believe it's a big opportunity that we can leverage also on these new routes to market because they at the end, they want to sell products. And we have these products. So we should be prepared that we can do business, that we are able to do business with these new kinds of routes to market. That's most important. And maybe but it's driven from the business, yes? I don't believe and I recently even said it in an interview, I don't believe in a Chief Digital Officer, right? It's driven from the market. The market asks and also we ask for inventory reduction, for example, optimize your inventories. So you need the data, and we have them now, in integrated parking systems to drive the process. The same is when you have design services, you have to send them all over the world. So you make the design in Holland and you send it to Dubai. So your infrastructure has to be ready for that. So what we are doing is per business team, we have an IT roadmap. And what Arnaud does with our core ER journey, we bring together these IT people once or 3, 4 months, and we share what they are doing. And they're learning a lot from each other. So that's again an ABUS network. That's such a big strength we have because a lot of processes are in different applications, different business environment and exactly in the core the same, the same challenges. And this makes you strong as a total blue. I see we have 2 questions via webcast. So maybe we can oh, that's question 1. It's from Joris Dubrat. Hopefully, my pronunciation is well from UBS. Could you please tell us more about the margin per geographic regions as we have only have revenues disclosed? That's a big question. Let's say the problem of that is, of course, that we that's correct. We disclose the revenues per geographic area, but not margins because it's always a combination of different products and different businesses. So yes, we don't do that. And I also don't think that it says a lot. So I don't know if you have to add something. You show 8% to 21% market share scores across divisions with huge addressable markets. You claim leader in each market in each of your division number 1, number 2. I was expecting much higher market shares or much smaller total addressable markets. Can you explain where I misunderstood something? Are those markets very fragmented, for example? It's a very good question, I think. I think the answer for me would be yes. I think that's true because when you look to and that's also the nice thing that when you look to the shares we have and really dig into that, our market shares are, yes, you can say 8%. In piping system, it's not so high. I think it's also pretty high, but it's a very big market when you look to semicon. And yes, it's still small. So I think this is the right conclusion that it's still fragmented and especially also in service technology, where we already have a very nice position, but this is very fragmented, very a lot of locations. So it's a lot to gain from that perspective. That's also why we allocate our capital on another way. So hopefully, this is the right answer. No more questions via webcast. Hopefully, maybe last question from your side. Any questions left? Martin? Martin Breyke, J. D. You mentioned you will implement a new reporting structure. When will that happen? New reporting structure? New divisions. No, no, no, no. We have no new divisions. I think what we did is that also to align, let's say, the divestments also to yes, because we have to divest certain businesses. So we made more direct reports to Utrecht. I think we took out certain businesses out of the, let's say, the niche technology clusters we just presented to give it more focus. So it means more focus for my colleagues on my left side and that we together and Masco Algonac is helping me with that is that we also drive the stand alone companies more closer than we did in the past. So we changed fewer reporting structures more directly to Utrecht. That's actually what we changed. So it's not that we changed the divisional structure. It's more that certain business teams now report more the head of this. So in the sense of the 4 business entities, nothing changes? No, no. Both the 4 business segments change. No. No. Yes, till now. We know that happens in the coming 5 year. Okay. I would like to thank you very much for the questions. I think it was hopefully, it was very informative and that we learned a lot, but we have a very nice experience coming. So then you can still ask the team all kind of questions, but also you can see the products and the digital services, which we do also a lot. And it gives you hopefully more insight in the business we do. So thank you very much and we'll see you.

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