Earnings Call: Q4 2022

Mar 30, 2023

Annual report

Towards you, Havel, it turned off for us. Sorry about that. I think actually we mentioned that the working language would be in sorry, the presentation language would be in English. So sorry, but I just totally forgot that. So I'll make the I'll make a quick switch. 20 22 has been a tricky year not a tricky year, busy year, sorry. It was it marked the 1st year we finalized as a listed company. From our perspective as the executive management team, we entered the extremely eager to prove that we could deliver the growth and that we could source the number of units needed to deliver the growth. And that eagerness substantial amount of units more than we set out to do going into the year. But it was it is a key value driver for us to add the units And so we were super eager to prove that to the market that we were able to do it. It was a theme in the general IPO process and it's been the theme throughout the reporting we did. So that has been a massive focus point for us. The other important milestone is obviously getting the new markets launched internationally, which was also a big part of our strategy and long term plan in this rationale between off listing the company. So having Successfully launched in Sweden to international markets is also a fairly good indicator that we can be an attractive partner to stakeholders and that we are able to export the concept abroad and internationally. It gives us a Long term potential, of course, when we can prove ourselves in new markets. And that is that's an important indicator, I would say, to the to sustaining our long term growth. So we've been busy. Besides doing a commercial launch in Sweden, besides Germany, I'll come back to this a bit later, but Germany is, of course, the most important market in mainland Europe, huge domestic economy, huge Economy Measured Worldwide, a lot of interesting markets. So Germany is important next focus for us. You can see that on group level, we have increased revenue by 30%. We have taken it up from NOK 56,000,000 in 'twenty one to The Danish operations, keep in mind that in 2021, we didn't have any subsidiaries. So Proper comparison is properly from Denmark to Denmark. But in Denmark, we've improved the EBITDA level up to SEK 9,000,000 from 6. And if you take that on a group level, we the operational EBITDA is 7. And that is due to start up costs in Sweden, where obviously, we still have this maturation process where we will carry an operational loss before we can generate enough revenue to sustain the local organization. But in general, steep growth, busy year growth tearing on bottom line metrics a bit more than we would like. But all in all, we think we've delivered some good progress. And now focusing as we've also communicated, focusing a bit more on super efficiency instead of just flooring the speeder and keep the sports car in 5th gear. We are consolidating, we're changing sourcing strategies. We're doing a lot of stuff under after the experience we've learned in 2022. I've brought this trend slide. You can see that the trends are positive, going in the right direction. Please forgive the weird trend line in the revenue meter. It's for some reason, it's doing a glitch. But we've grown revenue substantially over the years, from SEK 20,000,000 in 2018 to wise, the EBITDA levels from 2018 to 2022 has been grown substantially, just shy of SEK 1,000,000 in 2018 and up to the €9,000,000 point in 2022. You can see there's a dip in 2020 that's due to COVID. Hopefully, we are not going to discuss COVID anymore in our lifespan, but that was a bad year for us, as we've also said earlier on. And again, take the unit number, the last trend line to the right side of the screen. You can see that there's a positive correlation between the 3. And that is again to underscore that the unit numbers is an important value driver now and in the long run. We've developed our group structure since we entered the year. We founded 2 subsidiaries, 1 in Sweden and 1 in Germany. The Swedish company initially had its headquarter in Malmo and has since moved to Stockholm, where we have hired a very good Managing Director as part of the executive management team. She is doing well. She's a Stockholm native. Our commercial activities in Sweden is in the Skoln region, but we have the Danish operations that are able to support to local commercial activity with service and whatnot. There's also local organizations in place. But if there's any urgent stuff needed, we can be there fairly quickly from our Danish headquarter, which is in Copenhagen. Similarly, we have a German subsidiary in place. There's no commercial activity in Germany, but we've laid a lot of the initial kind of bricks on the path to a commercial launch. We've secured the trademark in the country, allowing us to use that and operate under our core name, which is great. We've also had a lot of legal advice in the process where we had to figure out how the business model would work in Germany. And we've also had our legal team supporting us in lease negotiations on some prospective properties that we are currently looking at. So all in all, it's moving along according to plan. We always wanted intended Sweden to be market number 1 because of the closeness to home and the cultural similarities. And then Germany was the natural next step for us, again due to geography but also the importance of the German market. Doing a deeper dive into the financial highlights, you can see we've tried to transparently show as many posts as possible. We've tried to And then you can see how Sweden is evolving, you can see how Germany is evolving, etcetera. And that comes to a group total in one of the columns and that then is comparable to last year. Again, comparing from 2021 to 2022 It's not a perfect one because in 2022 we didn't have all these subsidiaries to kind of carry operational losses, but We try to show everything as segmented and transparent as we can. And the financial breakdown is as you see here. So in general, we have a positive result in Denmark. But on the bottom line, retained earnings wise, but the overall one off costs And start up costs in the 2 new countries is dragging us to a loss. This was not expected. To be honest, we wanted to we were when we came into the year, we guided on a higher EBITDA result for the year. The growth, it's a combination of growth and inflation added cost and stuff has kind of hollowed that out a bit. We tried to chase it throughout the year and we didn't quite get there. So we're not happy with that obviously, but and then we've incurred some one off cost that we have just taken on the P and L in one go from both Sweden and Germany. So we had to kind of we just took everything on the P and L and can move on from a clean slate in the years to come. Our balance sheet is more or less unchanged. There are some minor movements, but nothing substantially. Our cash flow from compared from last year to this year, You can see that we have positive cash flow from operations in the range of SEK 4,300,000. This is a consolidated number. It hasn't been possible for us to segment this yet we will work on it and see if we can do that in the future. It's a deterioration from 20 21, that is mainly due to the fact that we had to yes, all the one off costs we've incurred in Germany, we have taken that under operational cash flow. So But in general, positive cash flow from the group. We've had a lot of investment activity. The investment activity is directly linked to the growth in unit numbers. And as you remember from earlier, we have added 142 units in the year, which is a lot and way more than we set out to do. And that just carries some investments to it, Starting up in new countries as well. A lot of factors has an impact on that. And then we also Keep developing our IT platforms, which is an important part of our strategy. So that is the major investment items that we've incurred in the year. That comes to a net change in cash flow and a closing balance as you can see in the bottom. Key ratios, I'm not going to dwell too much about it. There's improvement and there's deterioration. You can see A general deterioration on group level, that's again because we have the subsidiaries dragging the averages down. You can see that the ROIC is way lower than we liked and that's a direct consequence of the results. There's improvement on EBITDA level in Denmark. On a group level, there's a deterioration. So it is balancing this expansion strategy, balancing domestic growth with bottom line numbers. It's an exercise that's a bit tricky. We know that there is wear and tear on bottom lines when you kind of set out to do this, but it's also part of the journey that we set out to that we embarked on, so to say. So it is more or less as planned. Our total unit number Our operational data is also something we show in quite detail. Again, you can see that we have increase on a group level, we've increased our unit number by just below 48%, which is a lot and a lot more than we have been used to. You can see that the revenue per unit is deteriorated. That is mainly due to 2 circumstances, one of them being that It's a naive number. So what we do is that we take the units end of year and then we just divide it up by the revenue they've generated. And units coming into the portfolio late in the year, they do not have a full year effect. So that will have a tear in the negative direction. And then obviously, Sweden, It's being a completely new market we've had to cultivate. It's a mix there between units coming in, say, in October or June and then obviously carrying a high vacancy as you can see as well. So, we have carried an above normal vacancy rate in Sweden, but that is due to the general kind of start up practical timing, how fast can you get the unit in operations and how fast will they be rented out? The director we hired, we wanted her to, there was some timing issues and when she could start and it's just some minor practical headaches that we've learned from. But it's in general, before you get the market maturation, in general, I would say, It's within the boundaries of reason. We've also shown this slide, it's a new slide that we have Carry on the narrative that we've had all along, when we did the IPO, when we pitched the IPO both through professional investors and the retail market, We estimated that a new market would cost roughly DKK 5,000,000 in investments. So that's why we've made this breakdown. You can see The direct investments we've made into the FF and E, that's a positive one. We are able to furnish units at a lower point than we are used to and that's due to our it's a strategic measure. I can I'll come into that a bit later. Another interesting one is that we don't have any cash securities in Sweden. This is an important factors as well going forward. We've been able to supplant cash investment or cash securities with guarantee structures. So there's some parent company guarantees in place instead of cash, which is conserving cash better and that's a massive positive. And other than that, we've shown the direct loss from operations. We've shown the other operating cost that is one off legal advice when setting up the entities and getting the structures in place. And then there are some allocations from the Danish parent, because the Danish parent has been managing Sweden and doing a lot of things before we could kind of hand over the operations to the local director in October. Touching on our guidance for next year. We I would say we are carefully optimistic. So we're still guiding on growth in revenue in the range of 14% to 20%. The reason why we are not more optimistic is due to the general macroeconomic environment. We can we kind of everybody is kind of feeling the we still have the inflationary pressure, we still have rising There's a bit of an unease around us. We have some unease in the banking sector. We have some general stuff. So we're trying to manage expectations well already. So we are yes, I'll call it carefully optimistic with this guidance we're doing now. So the revenue is expected to increase from DKK 73,000,000 to DKK 88 €1,000,000 EBITDA from the Danish operation is expected to land in the range of €11,000,000 to €12,000,000 In Sweden, we are We believe we are close to the breakeven point, which is obviously a pretty good achievement, I would say. But we are so we are guiding in the range of negative 1% to breakeven in Sweden on operations. That then trickles down to an EBIT number and comes to a total on the group side. Our investments is expected to be lower than they were in 2022 and that's due to 2 things. One of them I'll come back to in a second. The other is Because we've added so many units, we are so far ahead of our investment curve, I would say, and our growth curve that we Using this moment to kind of catch our breath, evaluate on what we did well and what we did poorly and then try to super optimize while still planning for the long term growth, so I will come back to a bit later. So that's why Investments will be lower. It's also why the pipeline is not as impressive as it was in the year we've just concluded. And I'll explain why in a second. The current product portfolio is this slide has been shown a couple of times. We have 3 main product groups. Adding new products is a good way to utilize synergy effects. It's also a good way to maintain long term growth if the synergy effects can be achieved. We sometimes when I have to explain this to my people, I say, It's like when Coca Cola launched the Fanta, the people who don't like Coca Cola can drink Fanta and etcetera. So that's the rationale between doing it. We're still staying focused to our core segments and we're not just throwing products out there left, right and center in the eagerness to deliver growth. We are doing it controlled and carefully. And if we can see that the synergy effects is present, It is something that we would that we will kind of pursue. And you can see the share of the different product groups, Service Departments being the Corporate Housing segment being the biggest one still, large one still by far. It has a 93.9% share and then Co Living has 6.1% share. The furniture rentals currently do not have a share. And but it is expected to generate a share, of course, otherwise we wouldn't Brag about having it. An interesting point is that CoLiving has grown a lot since last year, 145 year on year in that segment alone and then the core segment has grown 26.5% and that comes to a total of 30.3 So yes, the client concentration also and for us an important metric to monitor because we are a big B2B provider, servicing a lot of big, big corporations. We're always keeping tabs on the share that they symbolize the revenue they bring. And we have an internal risk number that If client revenue share go above 5% then they become yellow, if they're above 10% then they're in the red. So there's 2 major trends here. One is that we are still well diversified. We don't have any clients representing revenue share above 5%, so that's good. However, as you can see when compared to the last period, our Client concentration is higher than normal. And it's due to larger again, It's due to that we because the diversification is so great, we can utilize our existing relationships When if we see industries or segments that are a bit more cyclical that might be going down, we can then kind of utilize some of the other clients we have and allowing them to up their share without it being too great of a risk to take while doing it. So we're not reliant on few clients and we can see that there are client loyalty as due to the fact that the latest from the latest period to now the big the top 10 clients has increased their share more or less, not all of them, So doing technology development, it's something we're actually extremely It's a big thing for us doing this and we are probably not as good as on communicating this as we should be. When I look at our bios across all sorts of So tech enabled as we are, because we are extremely tech enabled. Our entire order flow and service flow and all that is more or less digitalized. We have a lot of products in place, platforms, management software systems, access systems that are integrated into our software systems and we have done everything in house. We've built the computers in house. We have written the software in house. So, and one might, you know, why are you doing this? Why don't you buy stuff off the shelf? And we don't and that's done for two reasons. We believe that our user experience is going to be way greater when we have a customized system and flow that is only fitting our industry. And the next thing is that we at some point, we might be tempted to explore whether we can commercialize our infrastructure to 3rd parties. And that can be a mix of licensing, that can be a mix of delivering traffic, we can do that in different ways. So we are currently making our software as good as it is so that it can become a standalone piece of product, but it will take some time and we won't make any promises yet, but it's a focus point for us. The ROIC, we've called this one. It's basically we've basically developed our own furniture brand. And So we have designed a lot of furniture ourselves and we will get it manufactured directly from factories and it's a way for us to keep our investments in check instead of buying it from 3rd party retailers or wholesalers that has to make a margin as well, we can get it directly from the source and it's our designs. It's totally customized to our industry. So it is good quality stuff, marble, welded steel, aniline letters And it's made to be timeless and kind of worn, but not look cheap in while doing so. And this is partly why as well that we were able to furnish Sweden with a relatively low per unit investment. It's because a lot of the stuff that we do, we us stand out from our competitors. We don't go to discount furniture shops and buy cheap furniture. We try to create Some really good stuff. The current markets we're in, it's as shown, it's in line with What we've communicated throughout the year, we have the 3 major cities in Denmark and then we have the 2 cities in Sweden. And the unit breakdown is shown as well. So we try to be fairly transparent about how they look, how many in each city and how many across each product. As you can see again, we've taken the unit numbers up fairly substantially. We now have 440 units in total and we entered the year with 298. The next markets in focus, again, this is part of the long term plan, of course, and we've made a few marks. We obviously have the key cities in Sweden, Stockholm, the Stockholm region being the Most important focus for us, but also a city like Utepe is a fantastic market for us. So that is what we're focusing on in Sweden. It is less risky to kind of in the up your reach in the Swedish market because we're already present. So we've So I incurred a lot of the one off stuff when the market is getting to know us and it's a fairly it's an easier way to grow than doing new markets. That being said, I've said it before, Germany is by far the most important mainland market in Europe. So And Germany as an economy has the potential to it has maybe, let's say, 10 megacities that has the potential to be bigger than Denmark alone. So getting a foothold into Germany is super important to us. And Because of synergy and geography, that's all the closeness to home. We are focusing on the north, which is Hamburg in Berlin. We have some good talks in Hamburg, but nothing is completely finalized yet. But we expect that Hamburg is going to be the 1st step for us in Germany. So changing sourcing strategy, this is a bigger one. It's a completely calculated change for us. We And it is one of the key learnings, I would say, we've taken away from 2022. Doing this stepwise incremental growth, adding 3, 4, 5, 10, whatever units across different cities throughout the year in a successive kind of way is tricky to manage in a profitable way. It is, there's some practical stuff, purchasing, planning purchases, there's people involved. So if deadlines get kind of blown in the one of the early stages, it will also get blown in the later stages. So you'll be chasing it around all year long and And it's just inefficient. By changing sourcing strategy, we will sacrifice short term kind of reporting on our we've added 15 units here and 12 units there. On the other hand, we believe it will be way more profitable in the long run. And when we then do new projects, it will be larger box. So if you look at the image to the right side of the screen, you can see a visualization of a product that we are currently in or of a property we are currently in talks with. We'll have a fancy logo on the front facing the main street in Hamburg. It will be have great exposure to our brand and marketing purposes. And hopefully, we can finalize that one and report some positive stuff before long. The downside is that there's a lead time to this. It will take longer before new units will then come into operations. But when they do, it will be bigger bugs. So in the big scheme of things, it should be It should kind of even out and it will allow us to plan everything more efficiently up until these launches. So there's a lot of benefits and the trade off is that Europe, yes, they won't we won't be reporting any small increments of units here and there. So the roadmap, this is the same as always, nothing has been changed. It's just to show you that this is still the strategy we are This is still the promise that we are working day and night to deliver on. The only kind of change that you could see is the compounded 20% annual increase that might get a bit thrown off by this sourcing strategy. But again, if you fast forward to 2025, I would say that In the nominal kind of unit measure, I think we should be at the same goal line more or less. The weight of the goal is just going to change and that's because we have an added focus on profitability while doing it. If we then track progress compared to the strategy, this is also an exercise we do regularly. You can see that There's some greens and some yellows and some reds. And the green is the new markets, it's the growth rate more than approved. It's been a great achievement that we could do that. The trade off has been on the bottom line stuff and more or less all the other value drivers is bottom line value drivers. So they are hurt by this steep growth. Our revenue per unit is it's outside of the range. It has normally, it is within the range, but because of Sweden and everything, it's drawing the average down. Same with the EBITDA, it's improving and it's closing to the 15%. Obviously, we want to be better than 15%, but it's closing. But it's still deteriorating. Vacancy is a bit above the guided target, a bit better than last year. We have had vacancy throughout the year of roughly 8. So we have been in the green, but in Q4, Q4 is a seasonal quarter that is weak. And we also added a lot of units in Q4, which ended up sitting EMT for far too long before we could get them out and operating. And the ROIC, if you look at the Danish business isolated, the ROIC is improving from 6.4 to 10. We can do way more here and we want to take that up and that is the aim. And if you then look at it from a group level, it's at 0.04.8. And that's again, that's why we it's red. We don't like that one, but it can be helped. When you take it all on the operational loss, it can be helped. Just real quick, I'm not going to bore you too much about the ESG, but we Launched an impact report, our first version of our impact report, we did that in November, in parallel with the operational cost of From 2026 onwards, small listed companies are expected to do this. So we kind of figured we would get a head start and start mapping everything out. And then we could make it more scientific as we go. And hopefully, when we are required to do this reporting, we have it completely nailed, So it doesn't take us by surprise in 2026. We are doing a lot of good stuff, I would say. We have we are very focused on sustainability in the way we consume and the way we produce. We buy all our wind power from Ersteld there, which is renewable energy sources, roughly close to 1,000,000 kilowatt hours a year. So it's not pennies. It's a bit more expensive, but it's kind of part of our ESG strategy. We also do some philanthropy work. We've carefully kind of formulated our little foundation. It is very little, you know, humble contribution, but still it forces us to do stuff. And we are focusing on some sources and we are you know, pledging some revenue, we are pledging some different stuff. We are using our networks to kind of be able to donate to some good local causes. And throughout the year we've supported 2, Helleborg, which is a fantastic And we've been working with them on some different stuff and we're going to do more with them in the future operated by some fantastic kind of energy bundles of people doing good stuff. Similarly, when we when the war in Ukraine broke out, We got approached by 8 Ukraine Denmark and it fit perfectly what we wanted to do. So we were able to house some Ukrainian families that came as refugees and it costs some money, but it makes us feel pretty good and we put our money where our mouth is. So that's why we and we so we're looking for these sort of courses to support and which will up it as we go. So that was it. Thank you for your time. I will hand the baton over to Anders, who will then moderate the question session. Thank you for listening. Thank you, Patrick, for your presentation. So let's move into the Q and A. We have received some questions on Stock. Io 1st, that was submitted before the event began. So let's start with some of those questions before we take some of the questions when they live here. So the first question is from an anonymous investor. What is the potential in Denmark measured in number of units? And what is the potential in loan and Malmo? It's a great question. The general market is growing. If you look at industry reports, it's growing at roughly 14% annually, and it has been for 10 years or so. So so, yeah, if you look at the industry growth rates, you know, They are able to they can in theory, it should be able to consume, let's say, 500 units a year, new units a year. So For our part, obviously, we will be good we will doing it organically and see if we can we obviously need a part of that share, but operations of existing stuff, it's different. But I would say, my guess is that It's not like we feel we can grow indefinitely, but I would say we could easily have 900 units in Denmark that is part of the longer term strategy And what then if you look in Lund and Malmoore? Yes, sorry. Of course, there are smaller markets than the capital areas. And That's also why Stockholm is so massively important for us compared to loan and memory. But loan and memory served as a kind of bridge here. I would say that a unit in total of roughly 100 to 150 would not be unrealistic. If you combine the 2 markets, That would be my best estimate. But Skolnia is more a bridgehead for us for further expansion into Sweden than it is going to be the core focus for our growth strategy in Sweden, if that kind of answers the question. Yeah. So next question is also from an anonymous investor. Blue Ground had an article in person about their focus on the Scandinavian market. How competitive are you compared to BlueGround? Yeah, good question. Blue Ground is a very big international player. They have launched a lot of new cities and markets The past couple of years, they have raised a lot of capital. So we obviously It's not that I love talking about competitors. We like to focus on what we are good at, but it's not that we're blind to the competitive environment and we knew that they were coming. So we try to analyze how that could impact the equilibrium. And when they launched their first units, we could see that their price points were significantly higher than ours. And also the service level, the apartments look very good and the furniture and all that looks very good and and kudos to them. But the service levels in general looks like it's a bit lower than what we normally what the client corporate clients are normally used to in Denmark. So I would say our service and flexibility is greater. I would say our You could argue that their standards might be a bit higher than ours, if I have to be kind of super conservative. And then but I think the main point is that our price points on a general basis is lower than Blue Ground. That's always what you where you want to be able to compete in my opinion, because there's a lot of big key stakeholders and clients out there who are extremely cost conscious. So if you can't compete on costs, you will only be Happy when the market is expanding and going up because then there'll be a spillover to whatever substitutes we have out there. But if a market is either stagnant or shrinking, you don't want to be the 1 in the far end of the price range. So it looks like we have a better price point and for the from the time being, I'm happy with that. And then let's see how they Next question is from Christian Hilkorn. It is possible to follow the currently available apartments on your website. According to annual account 2022, The vacancy percentage in Sweden was 40.5% at the end of 2022. Can you confirm that Sweden already has a vacancy percentage, which is largely equal to that in Denmark, That is just under 10%. Yes. Yes, I can confirm that Sweden is working very well. Before, you know, vacancy is a bit of a it's not a perfect scientific measure because It measures the number of days that a unit sits available. But right now, I believe that we have, I don't know, 3 or 4 sitting available. And then that might get rendered out for amount of time and then there's a natural kind of rotation. So we're monitoring the days it's available. On the other hand, why vacancy is an important metric to keep track of is because it has a direct reverse correlation with the revenue we can But it looks like that the Managing Director over there is doing a very good job and getting some attractive kind of prices for the products and the services we deliver. So in general, we are happy. I'm not going to sit here and say, yes, it is below 10, but it is close to where we want to be. Okay. The next question is also about the vacancy, and it's from an anonymous investor. How has vacancy developed In Sweden compared to Denmark during the year, on average, vacancy is higher in Sweden, but there's also some time before all units are operating. So if we look at Q4 or December 2022, how was vacancy in Sweden compared to Denmark? What do you call it? It's not a if the unit number is not that mature, you can have some high spikes in your vacancy counter. And the more units you have, the less important It is that that obviously you want everything more or less rented out at the same time, but 8 units in a 4.40 portfolio doesn't matter. But if you measure it locally, it has an impact, of course. But Sweden was higher. It was, you know, the director, she had a first day at work on October 1. Then we kind of come into Q4, which is a bit crappy quarter for us in general. So the timing in that sense was not great. That's also part of why we're changing sourcing strategy. We want to be able to plan that stuff better out. It's no good kind of launching stuff in November when we know that the demand is like on a general slump. So it was higher than in Denmark, but it's The director in Sweden has been fantastic at cultivating the relationships needed. In our industry, We're very good with the digital presence and those sort of things and people find us and people who walks in from the street and all that. We're good on that. But in our industry, it's super important that you keep some stakeholders happy. And those stakeholders If you measure it on a world basis, it's a very it's not a big amount of people that you have to keep in the loop. So cultivating that relationship will take time. But when you have, you know, convinced them that you can be trusted and that you are Perfect. Before we move on with the questions from Stock IO, maybe let's take some of questions that went in live here. So the first question is also about vacancy. Let's just take the question so that you can answer it. How is the average vacancy of 10.3% for the Danish market calculated? The days available empty days, the units are still if you take the number of units throughout the year, it's been registered for Monday launch and then the days are counted. If you It's a measure that is kind of borrowed from the hotel industry. In the hotel industry, you're working with OCC or an occupancy rate, so that's like the reverse of the vacancy rate. But basically, if you have 100 hotel rooms, you can rent it and you have 3 65 days throughout the year, then that gives you your kind of Your denominator. The downside is when you keep adding units, your denominator is constantly changing. But we have a system in place that is recording everything in real time. So we can kind of keep tabs on it on a monthly basis. So it's We have 2 measures in place. The one is a naive number, which is just counting the days per unit and the other one is a weighted average of the sizes of the apartment. And that's because a larger apartment will cost you more to have empty than a smaller apartment will. And so you have to kind of look stare that in the face as well. So we have 2 in place, the naive one just counting days And the weighted one that is waiting the data based on the apartment size. Next question here from the live audience. How much of the costs associated with Growing rental capacity is capitalized, putting it in a different way. How and how much is the profit and loss affected by the increase of rental capacity in 2022? Yes. I would say, You can easily track the Swedish one. That's and I would say that if you look at our guidance for 2022, which were between 10% and 12% and we have realized 9%. And in combination with that, we've realized the high end of our revenue guidance. So let's just a burn from like aggressively growing and maybe let's say 1.5 of those is a measure of aggressive And the other one and a half is the inflationary pressure that we've incurred on energy costs and things like that. That's my best guess. I don't have the perfect number. I'll make that better in the future. Yes. And next question. Do you have any considerations shifting to an expansion strategy that consumes less cash? CapEx in 2022 was negative €10,000,000 Yes, we do. It's a perfect question. I you should also you should almost kind of feel like it's I've asked someone to post that question. Yes, we do. It's, it's, it is, we have been exploring, you know, we've taken it in baby steps. Start, when you start out doing what we do, It makes no sense to do a furniture production in house. It's a ridiculous notion. When you then come to a certain size, you can then start to see, okay, when now it kind of makes sense to think about efficiency and kind of bringing that number down without messing with the quality. So that was like step 1 for us to do that. Started with 1 piece of furniture and taking it to a lot of pieces of furniture. It still represents an investment. It still represents this cash cycle, which where that before you can get stuff in, you have to invest. When is the breakeven point or the payback time and all those sorts of technical measures. So in the future, the current talks we're holding with bigger projects is Actually allowing us to disconnect the 2. There's the obvious one just going in and saying, okay, if you are looking at a 100 unit project, I'm not saying that we do, but let's just keep You can source, you know, unit accounts, which is lower. And the other one is that we We actually when you're doing deals of that size, you can you can there's a lot more stuff that you can kind of negotiate on. So one of them, for example, being who will carry the investment of the FF and E and it's not uncommon in German. It's very practice and we kind of took that learning from Germany back home. It's very common practice that is the landlord who does the FF and E investment. So that kind of takes that off the operators books. So that's it. Obviously, when we came when that dawned on us, we've always been in that mode where we, okay, we will invest. No worries. Let's go. And then it dawned on us talking to advisers and brokers and all This is actually fairly market conform and we're taking that with us. And so in doing these sorts of structured deals, There's a lot more room for negotiation than if someone comes and say, do you want 5 apartments? If I then go back and say, yes, but you have to invest in the furniture, they will They will just say, okay, no, thank you. Don't don't worry about it. But if you come and say, yes, I'll take a house with 100 units, A lot more can be negotiated. So we are trying to disconnect the 2 and hopefully we can report some stuff on that in the year to come. Perfect. Then there's a question regarding your outlook. What does the pipeline interval mean? It says Denmark pipeline 0 to 20. Yeah, it is. It's Yes, especially just a pessimistic expectation to the number of units that we want to add to the portfolio this year. It's a product of us being so far ahead of the curve and we've more or less we're nearly done like 2 years of growth in 1 year, if you measure it just by units. The full year effect has not kicked in on revenue. That's why we will still be reporting growth in the revenue bracket. But the reason why we are being fairly conservative on this is because if the right project comes along, we will get this perfect product that fits our criteria our kind of updated criteria perfectly. So that's why we are being a bit cautious on that and saying it's in the low range on new units. Okay. How much of your revenue was generated from private customers? Yes, good question. It's roughly, I would say, 15% roughly. We have some different segments. Corporate housing is the big one, having the direct relationship with the companies. Then we have insurance clients, So people who is affected by water damages or fire and have these distressed saw the moments in their life. We are very good on that and are delivering to that industry. I would say, and then we have sports clubs, they're using us fairly systematically as well. So And then we have government, so the United Nations, you know, hospitals, educational facilities, stuff like that. And then there's the private segment, so people that walk in from the street, and that's roughly 15% right now. How was the vacancy percentage developed over the year? You have looked into Sweden, but maybe for the Entire group? Yes. Good question. It followed the seasonality pattern fairly well, I would say. So And then if you then add the number of units we added in Q4, that kind of made an unfortunate combination. And that was the practical thing where we couldn't we just didn't have the manpower to get it in operations fast enough. We were too far behind throughout the year. So we tried to chase it all around, but the combination of adding a substantial amount of units in the quarter in combination with the general seasonality made that Q4 vacancy was up. Did you receive any revenue from the 8 Ukraine project? Nope. That was a no, yes, no question. The answer is no. And then going back to the questions submitted at the stock. Io. There's a question from an anonymous investor here. How much time does it usually take from you get a new unit signed till it begins generating profit? You invest quite heavily in the beginning, I assume, in furniture, technology and everything else. So when is the breakeven point for a unit? Yes. Again, a great question. It kind of it depends on when you measure on what kind of level you want to measure it. When we take on new units, we have this calculator, which is an advanced spreadsheet. And then we allocate a share What we believe is our best guess on the capacity we can take. We also have some variable wages we put in because we How much cleaning, how much lending, all that stuff will take, we then have some good things in place. But I would say that If a unit cannot generate, again, it being a bit unscientific because you have the capacity cost, you cannot carve that up into a 500 points or 400 order. And cash cycles that comes to a payback time of 2.5 to 3 years, if you just look at it on the divestment on the investment alone. And that sounds pretty high, but if you look at That sort of return on an industry, if you look at that across a lot of industries, it's actually fairly attractive. Let's take a company like Maersk, for example, before they have boom year, they are guiding long term on a ROIC of 7.5. We have a few items like carpets. They're not extremely pricey because if someone spills red wine or whatever, you don't want to offset decline with sending them a bill of a lot of money. But other than that, the structural big items, they are high quality. And we can see that the lifespan is great. If you think about our depreciations, they're also fairly But we can we are starting now to the early stuff we put into operations, we're starting to see that The depreciations have kind of run out and we can see that the lifespan is still great on the stuff we put in early in the year. So that's good for us. So having a payback Time of, let's say, 2.5 to 3 years is not horrible when you consider that the lifespan of the furniture easily access is in The next question is also from an anonymous investor. It's a bit of a long question. So here it comes. In the 2022 report, you state that going forward, you will change the sourcing strategy that you will source units in bulk with the focus on early stage developments. This means Fewer but larger deals. Does this also mean the developers you work with will have to change going forward? Developers that want to rent 1 to 2 units to move in might not be the same developers wanting to rent out an entire building to move in. How do you view this change? It is now it's a great insight. It's It really the question the one asking that question has thought about it hardly. I can hear it. It's a very good point of view. The answer is yes and no. We work with pension funds. We work with super large asset managers. We work with international investors with activity in Denmark and Germany and stuff like that. So it's true that some maybe some of the early ones that There is still a lot of, what do you call it, repeat offenders, so to say, in our usual suspects across our current kind of partners. So great insight. The answer is yes. Some of the smaller ones will probably Yes, perfect. And the last question. At your latest report, you expect the Cost of debt to fall to 4.06%. It is at 4.87% in the 2022 report. What do you expect cost of debt to be in 2022? And how come the cost of debt fall during 2022 when interests are going up? Yes. It's, I'll let me reply to the latter first. We did some renegotiations on our debt early in the year. So that's mainly why we were able to bring the cost of debt down. We And the reason why it's up higher than what we kind of thought it would be is that we had to pay negative interest rates on the cash holdings we had. And we are in the negative still. Yes, we're working on it. It will be changed at some point. I'm not I'm sure I'm not the only banking client that has experienced this in 2022. But that's the reason why it's from 406 to 48 is because we had to pay negative interest rates on the cash And the reason why it has gone down is because we renegotiated a debt earlier in the year. So that's the direct My best guess right now is 5%, as I also put in the guidance, but I basically I have no clue. I know what I'm paying, you know, but the way that these loan agreements work is that there's a fixed interest rate and then there's a reference rate that you have to put on it. And we don't know how the reference rate will live off if interest rates continue to rise. But it is going to be fairly small portion of the total stuff. So my best guess right now is 5%, but it could be changing if the interest rates continue to Perfect. That was all the questions both live and from Stock. Io. I will hand the mic over to you again for final remarks. Yes, I can see that there's one question about what German region, but I I answered that already, but just to underpin it, it's Hamburg. Hamburg is number 1. Hamburg is a Fantastic city market. You have the I'm not sure if it's still the 7th largest pole in the world is in Hamburg. So a lot of our shipping clients have a massive amount of activity in Hamburg and the business activity in general Makes Copenhagen look like LEGOLAND is my favorite one liner when I'm talking to German stakeholders. So Hamburg, Berlin, number 2, and then you can take it from there. But a lot of interesting regions in Germany, Frankfurt, Munich, Stuttgart, The whole Ruhr industry as well. So a lot of interesting markets, but Hamburg being number 1. Perfect. Sorry if I missed a question. No worries. I just wanted to, when people are taking the time to ask us questions, we will answer it. So thank you so much for listening in everybody. This was a good session and thank you get a better understanding for what we do and also maybe demystify some stuff. And so thank you so much for that. It's been fantastic.