Good day and thank you for standing by. Welcome to the EVS Full Year 2023 Results Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be the question-and-answer session. To ask a question during the session, you need to press star one one on your telephone keypad. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Serge Van Herck. Please go ahead.
Thank you. Good morning, good afternoon to everybody attending this update on our 2023 full year results. Before we start, I'll let Veerle explain or read the disclaimer.
Yes. So the traditional disclaimer, this presentation will include forward-looking statements. Those statements are based on the current business and the current financial conditions and market conditions that we see of the operations of EVS and its affiliates. There are definitely risks always concerning the forward-looking statement, risks that could potentially lead to changes in that forward-looking statement. We may refer to risks and uncertainties linked to technology changes, to company concentration on one industry, to decline in demand, etc. And those risks and uncertainties, they may have an impact on those forward-looking statements. We do confirm, though, that the current forward-looking statements are based on our best ability and assessment of our business and the current financial and market conditions.
Thank you, Veerle. So looking at the agenda of today, we'll be talking, of course, on our business update, financial update. We'll talk about the outlook for 2024. We'll have our conclusions. End to end, we'll have the opportunity to listen to your questions and give you our answers. So let's start with our business update. 2023 is the year that we celebrate our 30th anniversary, and we're very happy I should say 2024 was the year that we are celebrating 30 years. But we're very happy to see that we end the year 2023 at a new record level of EUR 173 million revenue. So, of course, we're quite happy to see that happening. That's a result of our PLAYForward strategy that we started implementing at the beginning of 2020. And it's clear to say that we see the results here even in an uneven year.
So that is indeed something we're very proud of, of this achievement in revenue. When we go to slide number six and we look to the corporate highlights, we definitely see that we are on our way to our BHAG, our Big Hairy Audacious Goal. We'll explain again in two slides later what that exactly means. We feel that we are definitely on the right path to further growth for the future. When we look to market and customers, we definitely see the growth of revenue and of our order book. We also can confirm that we'll be supporting some of our customers to operate those big sporting events in 2024. We see that our strategy regarding channels as key partners is definitely also bringing fruit. We have clearly a view that certain competitors are diverging from our industry, which is helping us going forward.
We are evolving with our product portfolio and our solution portfolio towards an ecosystem. You've seen us announcing in September last year the launch of our VIA MAP solution, which definitely will have an important role to play in further supporting our growth in the future. In 2023, we saw an important growth of our LAB customer base, the live audience business customer base, both in revenue as in order intake, which definitely was the objective of our strategy. We see that on the NPS side, the Net Promoter Score, we see that indicator further increasing with very nice results. We'll come back to that later on. We are a technology company active in the broadcast industry. When we look to those different technologies and the evolutions, we can definitely point out some important topics.
We see more and more AI-based workflows that are using our solutions, our AI-generative solutions. I understand that everybody is talking about that and that is something that comes with ChatGPT last year. But remember that EVS started already investing in AI and in generative AI more than five years ago. So currently, we have already several products which are integrating those technologies and that are being used by customers around the world. We have launched our thought leadership exercise around Balanced Computing some time ago, which is based on on-prem computing and the right combination between on-prem and cloud-based computing, integrating both AI as well and making sure also that there is a focus on carbon footprint and ESG. And last but not least, technology is something that continues to evolve. And in that respect, we continue our investments in future growth.
Still today, we have about half of all our team members in our company that are working on technologies research and development. Talking about corporate topics, we definitely confirm and reconfirm that ESG is part of our DNA. We see that the engagement survey or we see out of the engagement survey that we do at EVS that our colleagues are very much appreciating EVS as a great place to work. We are happy to say that the acquisition, the Axon acquisition we did in 2020, is definitely showing its results and is contributing to our growth worldwide. We continuously put focus on our cost control. That is more and more something we have very well under control. And last but not least, our team size keeps increasing to enable our future growth. But we think we have that growth definitely under control.
Last but not least, when we talk about shareholders and shareholder value, we're quite happy to say that we see the growth of our revenue and our order book continuing forward. We see that or we can definitely now say that we are able to successfully execute M&A transactions and that we can demonstrate that through the Axon case, of course. We see a very strong EPS, further growing compared to last year. And we're quite happy to see that this also translates in a company valuation growing further. And with 30% growth in 2023, we think we have been demonstrating definitely a good growth. Next slide, financial 2023 performance. I'm happy to ask Veerle to present us those key figures.
Thank you, Serge. Yeah, we have a couple of metrics to depict our financial performance of 2023. First of all, we start with our order book, which is whatever revenue we will book in future periods. We're happy to say that this order book is growing by 12.9% compared to last year. And we have a total amount of EUR 153.2 million of revenue to be booked in future periods. For us, it's a very important metric because with a strong revenue, we're also happy to see a strong order intake, making sure that we continuously build up our future and start our year, actually, with a more positive situation than the year before. And therefore, also, yeah, making ourselves ready to grow further. We have our revenue number. Revenue number falls in EUR 73.2 million on itself. It's a 16.9% growth.
You have to remind that 2022 was a year with big events. So if we neutralize for big events, we actually grow EUR 35 million year-over-year. And it's a growth of 25.9% once you normalize. We're also happy to see that that revenue growth was accompanied by a strong net profit. Net profit is at EUR 36.9 million, growing 17.9%. And in terms of FTE, we kept our FTE basis or team member basis quite stable. We ended the year at 622 FTEs. And it's a growth of 1.5% throughout the year.
Thank you, Veerle, for this update on those key metrics. And we can only say that we're quite happy with the results, especially that we are now celebrating 30 years of EVS at a next revenue record. And that brings me to the next slide, our BHAG, what we call our Big Hairy Audacious Goal. So to become that number one solution provider in the live video industry by 2030, that is indeed part of our strategy that we put on paper at the end of 2019. And we feel that we're on the right track to be able to achieve that by 2030. Going forward, indeed, I'll leave the floor here to Benoit, who can further explain us some elements that point in the direction of becoming the number one of our industry. Benoît.
Thank you, Serge. So I will start with, in fact, the value that we bring. EVS brings the value of reliability. This is very important for the live content production. EVS is about live. We have seen in the last years some evolutions of the media rights that were moving sometimes from TV to telecom operators and sometimes towards the big tech. But what is important is that the value of the live content only increases. The cost of production is a fraction of these media rights. The rights holders want to avoid any risk. Thus, the reliability of EVS solution is absolutely critical for our customers. We have seen in 2023, let's say, less traditional World Cups happening. EVS technologies have been involved in these World Cups.
It was also a pleasure to see, considering our ESG DNA, that the World Cup for women are also increasing in value and in audience. So that's EVS focused on live production. So we see as well an evolution going towards balanced computing. And balanced computing, it means that some part of the workflow will be executed on-premise. And some other parts of the workflow will be executed in the cloud, either public cloud or private cloud or broadcaster data centers. So we see this increase in the partial cloud deployments linked to an evolution in business model with sometimes more SaaS or sometimes more OpEx. But globally, what we observe is that the hype of cloud that was really present and strengthened due to COVID, in fact, is over.
Today, we observe that our customers have been living the barriers of the cloud in terms of cost control, in terms of latency, in terms of the difficulty to move media from one location to the other with absolute reliability and with controlled resources. So the Balanced Computing strategy that we are implementing within EVS totally makes sense for our customers. In terms of corporate strategy, in fact, we live the journey of transformation. So we come from a replay-centric leading product in premium markets. We already transformed the company to develop and propose optimized media leading solutions. And I think that the results that we present today is a proof point that we already at least partially succeeded on that.
Our next step is to evolve to a live production ecosystem in multi-tier markets with an evolution in terms of business model, continue to increase the share of OpEx and coming with on-demand proposals, continue to, let's say, grow in broadcast centers beyond the OB Vans, continue to develop the solutions as software and propose software as a service business models, and continue to extend beyond sport with entertainment, news, and more and more digital in the future. In terms of the solutions, you will see that this slide is showing that we combine products not only to create solution but to create an ecosystem. In fact, we have solutions today that are proven in the market. For the LiveCeption, we see that XtraMotion has been more and more used for events. XT-VIA continues to be deployed everywhere in the world.
LiveCeption has been contracted to be the core of 2024 major events. We see as well the success of Xeebra, our VAR product for the referees, thanks to our channels and thanks to the live service provider deploying this technology, and mainly in soccer, football. For MediaCeption, as we have presented at IBC, new AI-based workflows that were very well perceived by our customers. We continue to deploy MediaCeption in the different parts of the world. Part of MediaCeption as well, we have MediaHub. MediaHub is a solution that allows the media rights owners to expose the content to media rights holders. In fact, it was used in a SaaS model with more than a dozen of mid-tier events all along 2023. It is traditionally used for the big events. It is now also used for mid-tier events in a SaaS model.
In terms of media infrastructure, we continue to observe a very high growth. We have more than 20% growth in terms of order intake. Cerebrum is definitely spreading everywhere. In fact, we continue to have large contracts in NALA, just proving that Strada is a proven video routing solution. But we want to go beyond these solutions. We want to structure these solutions into an ecosystem, in fact. We started to make more and more bridges between the solutions. We started to link LiveCeption with MediaCeption, and coming with the concept of VIA MAP, media asset platform that was presented at IBC and again, very well received by our customer.
That ecosystem or this link between two solutions to make, let's say, the workflows more and more interoperable between our solutions but also between the LSPs and the LAB is really a key asset for the further evolution and development of EVS. That means that we today started with LiveCeption and MediaCeption, structuring, let's say, the bridges into this media asset platform. We want to go further. We want to go further in leveraging the full ecosystem, also more and more making bridges between LiveCeption, MediaCeption, and MediaInfra, and as well further extending the scope of the ecosystem through non-organic, meaning through M&A and strategic partnership. In 2023, we had as well several iconic contracts. One of these was with Oman TV, where we are deploying MediaCeption. We also have, in terms of LSP, Videocraft in Australia.
And also, we have strengthened our partnership with Cloudbass in the U.K., where actually, the customer is happy to deploy the new generation XT-VIA servers. So our scope is not only delivering solutions. We want to more and more focus on innovation. And this year, we have been hosting the SportsTech Belgium, which is an incubator for sport technologies. And we also did run the first productions in Belgium that were based and fully based on 5G centralized infrastructure and to distribute live theaters' events in all the schools all over the south part of Belgium. So we want to continue to focus on innovation. And all these contracts and innovations, okay, they are rewarded, rewarded in terms of product because we received this year an award for XtraMotion 2.0.
XtraMotion 2.0 is now offering the capability for the live service provider to not only run the XtraMotion in the cloud but also to run it on-premise, also showing the benefits of our Balanced Computing. That means that we have explicit requests from our customer to relocate something that was intentionally developed to be cloud at the beginning and now to move it on-prem. Second, we were as well certified, as we are certified every two years, for Xeebra, proving again that we continue to innovate with more and more technologies in terms of offside line detection and presentation to the referees. And so that's an important milestone for us. We also got some awards, the Golden Bridge Award for the tech innovation. We got an award for the corporate star for the best ESG leader.
As we had received in 2023, in 2024, we are again part of the top employers in Belgium. These, let's say, achievements are very important for EVS. They are also confirmed by the customer perception. I let Serge continue with the presentation.
Thank you, Benoit. So talking about customer perception, indeed, although we are a technology company, our strategy is one of customer intimacy and making sure that we bring the right solutions to our customers for enabling them to go live on air with their productions. What is important is, of course, to see also and to measure the net promoter score of those customers. So on this slide, you can see the evolution of our net promoter score over the last three years compared with some other players with some other players in our industry. And what is interesting to note here is that we have the strongest growth of that NPS in our industry over the last years. So from 12 in 2021, we have been growing to a number of 42 in 2023.
So that is definitely showing us that we are making the right steps forward and that the customers around the world appreciate, indeed, what we do. We see several other people or several other players in our industry with some good scores. But it's interesting to note that we see some of them definitely also losing ground. And that is also where we see that we are gaining market share. So overall, we're definitely happy to see that our customers are also translating their positive feeling about EVS in this NPS measurement that is being done by an external company called Devoncroft. Going forward, the acquisition of Axon in 2020 was our biggest acquisition up to now in the history of the company. And we can say that in the meantime, we're quite happy with the integration we've done and even more by the results that we see happening.
The growth of media infrastructure is helping us, growing also our overall growth. We are convinced that for the next years to come, we have quite some further potential to grow our business with media infrastructure. Another important strategic intent we have was setting up a channel partner program a few years ago. We definitely see that further growing. We see those partnerships further strengthening. We see that the revenues we do in different regions of the world with our channel partners is further increasing. That is definitely a very good sign. Looking at the market conditions and some IBC feedback we received in September 2019, we saw that there was a large attendance from EMEA clients and customers and also an increased attendance of channel partners. Feedback we got from them was definitely positive. We discussed quite some projects.
We see, therefore, a quite healthy pipeline. Media Infrastructure and Generative AI were definitely the stars of our booth with the different solutions and the novelties that we bring to the market. Last but not least, as was already said by Benoit, Balanced Computing approach is a concept that is very well accepted by our customers. They definitely don't see a cloud-only solution. They are more and more convinced that the Balanced Computing approach is an approach that is of very high value to them. Going forward and talking about some of our main risks, we continue saying that there is a scarcity of electronic components and, of course, a salary inflation that impacts our numbers. We keep track of our inventory of electronic components. We saw over a certain period of time that things were improving.
But unfortunately, over the last weeks, due to geopolitical tensions and due to longer shipment lanes again, we see that the required time to get components out of Asia is increasing again. So this is definitely something that we keep a very close eye on. We try to make sure that we're not impacted by shortages. Of course, on the inflation side, we see that salary inflation is impacting our number, our results. But we try to keep that balanced through price increases towards our customers. And up to now, we've been able to keep that in good balance. We said that we have been awarded again that certification of a top employer.
We also see that in our internal ratings and in our engagement survey 2023, we see that our colleagues are appreciating all the efforts we do to further increase the working environment on different dimensions. So we're quite happy with that progress. That really shows that our most important assets, being our own team members, feel that they are working in the right environment. They appreciate the efforts that we do to continuously improve that. 2023 was also marked by further focus on our ESG strategy. That has also been rewarded externally by EcoVadis and by Sustainalytics. We just received our silver medal from EcoVadis again a few days ago. For 2023, from Sustainalytics, we got a very good rating of 13.5, which in fact shows that we are worldwide in the top 15% of companies when it comes to ESG ratings.
So that's definitely showing that also there, we are making very good progress. Next slide, I'm happy to show you our slide for our 30 years. We start today celebrating 30 years of the existence of the company. We are quite proud, of course, to be able to do that with such results. The motto of our 30 years is all about family and friends. We are together there for life. We have a key role to play in live productions worldwide. We are still very happy to play such an important role and that we can continue to create emotions. In fact, we like to say that we create return on emotions. We do that for billions of people all over the world every day. We keep being very proud about that.
We intend to continue to do that for many more years to come. That brings me to the next chapter in our session here today. That's our financial update. I'll ask Veerle to guide us through that financial update.
Thank you, Serge. After the short glimpse that we started this call with, we will now take a closer look at our financial performance of the year 2023. First, a couple of metrics around top-line performance. As mentioned, the first metric, order intake, we believe that we had a very, very strong order intake for the year 2023. It was a total of EUR 192.9 million. It's true it's a decline compared to last year, a decline of 11.8%. Obviously, 2022 numbers were impacted by one big contract. It's our Big Tech 2022 contract. Once we normalized for that contract, we have a growth of 14.1%. Which is important for us is that the order intake definitely outgrows the revenue, which means that we are constantly fueling our backorder, which is a very important metric for EVS.
Going to the revenue, as mentioned already, the revenue number of EUR 173.2 million, a growth of 16.9%. Once normalized for big event rentals, it's a EUR 35 million increase year-over-year. We're happy to see also that it's a very balanced growth across the board, so across all the regions and actually across all the solutions. Obviously, if you look at the order intake and the revenue results, you will get to the order book. Total order book, as mentioned, is at EUR 153.2 million. You will see that it's growing by EUR 17.5 million year-over-year. We started the year 2024 with a secured sales at EUR 100.4 million. It's a growth of 16.9% and growing from a base of EUR 86 million in 2022. So it's definitely positioning us for a strong 2024 as well and a growth in 2024.
Our visibility also on future is also increasing. We're further expanding our secured sales for 2025 and beyond with a total of EUR 52.8 million. Taking a look at our revenue performance, you will see actually the evolution of our revenue performance from 2021 to 2022 to 2023. You will see it from both a market pillars perspective and from a regional perspective. If you go into the details, you will see or you will notice a positive evolution across the globe, both from both dimensions, actually. We're very happy to say as well that we definitely see proof points of our strategy in action. So for instance, our LAB performance is definitely demonstrating that we are able to grow above and beyond OB events and definitely gaining market share with more LAB customers and general broadcasters.
You see our LAB revenue growing from EUR 71 million in 2022 to EUR 90 million in 2023. Definitely, we also always mention that it's a long-term objective to grow our LAB revenue. For a reminder, the LAB revenue is often linked to longer projects and might not show short-term growth. But looking at the tendency over the last three years, there's definitely a very positive trend. We're also happy to share that we are growing our footprint in media infrastructure. We grow media infrastructure revenue with 26% compared to 2022. Also, our order intake is definitely going in the same direction. Our footprint is definitely proven there. Then finally, we're also happy to announce that we see our recurring services revenue increasing. We grow our SLA basis in 2023 by more than 30%. Again, a proof point of our PLAYForward strategy.
If we look at some metrics around profitability, first of all, we see our gross margin. Our gross margin for 2023 is very strong at 69.6%. It's actually a growth of 2.9 points year-over-year. That growth is influenced by a couple of elements. First of all, there's 0.6 points of profitability increase linked to the improvement of the profitability of our solutions. This is definitely supported by a good control of our price components and definitely also supported by the price increases that we did in the past period. Only 0.1 point is driven by a different solution mix, but it's still a positive impact. There's 2.2 points that are actually driven by a dilutive effect of our operation costs, our operation costs being primarily team member costs and therefore more fixed costs than our cost of BOM.
And obviously, once you grow your revenue and your fixed costs are under control, you have a dilutive effect of your operation costs. And this was driving 2.2 of the 2.9 points this year. If we look at our operating expenses, our operating expenses grew to EUR 79.5 million. It's a growth of 18.4%. But it's definitely a controlled growth. First of all, we decided in the second half to accelerate again some hirings after keeping it flat for quite some time throughout 2023. It's definitely a conscious decision because of the growth numbers that we saw in front of us. As mentioned already by Serge, inflation is having an impact on the increase year-over-year in terms of operating expenses. But also, some other macroeconomic increases are impacting that trend, like electricity and like, for instance, travel.
We do not necessarily travel more, but the travel on itself is becoming more expensive. We also decided on some one-off costs in 2023, one-off costs related, for instance, to the closure of one of our facilities. We also started in the fourth quarter of 2023, sorry, the depreciation on some intangible assets, the intangible assets linked to our VIA MAP. All these results have led to an EBIT performance of EUR 41.1 million. It's a growth of 29.8%, so a very strong growth. This is thanks to an outgrowing revenue performance and a very sound profitability and controlled growth of expenses. Our EBIT margin is at 23.8%. Looking at some financial structure metrics, first of all, we have our earnings per share. We are happy to end the year at an earnings per share of EUR 2.65 per share.
It is growing 15.7% year-over-year. It's definitely demonstrating the consequence of our sustainable and profitable growth strategy. Our net working capital is increasing compared to 2022. We have a net working capital that is at EUR 89.6 million. So it's actually increasing with EUR 11.2 million. It is linked to an increase of the trade receivables by EUR 8 million. The trade receivables are, however, in line with our higher revenue. And it's also linked to an increase in inventories of about EUR 4 million. Our working capital ratio towards net sales is, however, improving year-over-year. It's an improvement of 1 point, so dropping from 53% in 2022 to 52% in 2023. If we zoom on our trade receivables, we have definitely recovered from the outstanding invoices that we had as open receivables at the end of 2022. But because of the higher revenue, our total receivables are increasing.
As mentioned, they are increasing in line with our revenue. So looking at the percentage receivables towards revenue, we stay flat. It is an intention point for us, though, to manage this more closely. We have two regions where we want to focus on and where we want to reduce our trade receivables. And that is the Middle East and Latin America. Finally, we have a view on our intangible assets. So we start creating some intangible assets throughout the year 2022 and 2023. We've created a total intangible asset worth EUR 12.2 million linked to two specific projects. And obviously, the announcement of the VIA MAP in September 2023 led to the fact that we have stopped the creation of the intangible assets linked to the VIA MAP, and we actually started the depreciation in the fourth quarter.
Quarterly depreciation is now scheduled over a 5-year period at around EUR 0.5 million a quarter. The second project, which is by far smaller than the first project, the VIA MAP project, is still in development mode. We're still and will still contribute to further increase the intangible asset creation. But as mentioned, the impact is minor. We expect an overall investment in 2024 of approximately EUR 0.5 million. This is currently everything we have in intangible assets. Now, we obviously continuously screen our development projects. And we need to make sure that we don't fall into specific guidelines from IAS 38. We might see further projects coming up in 2024. We don't expect them to be anywhere near to the volumes that we had in 2022 and 2023. But it's obviously an element that could potentially impact our P&L. And I think that's it about financial performance.
I would like to hand back over to Serge.
Thank you, Veerle. That brings us indeed to the next chapter here, which is our outlook. What is our 2024 financial outlook? The important order intake of 2023 has considerably fueled the order book to be delivered in the future periods. The total order book at the end of 2023 is EUR 153.2 million, which is a 12.9% growth compared to the same period last year. The order book reserved for 2024 is estimated now at about EUR 100.4 million, which shows a growth of 16.9% compared to the beginning of the year 2023. Out of these numbers, EUR 7.4 million is reserved for big event rentals. And post-closing, we secured additional big event rentals contracts for this year.
So that brings us that based on this order book and the current market dynamics, we expect that our revenue guidance for the year 2024 will be somewhere between EUR 180 million and EUR 195 million. We expect a controlled increase in the number of team members to further support our growth. We expect to pay out dividends in 2024 in line with our dividend policy, namely a dividend of EUR 1.1. I'll leave Veerle again commenting on that dividend proposal.
Yes. I think the dividend policy for 2022 to 2024 has been defined earlier in the year 2022. The policy did foresee a dividend of EUR 1.1 per share for the year 2023. We expect to bring that proposal forward for the approval to the ordinary general meeting of shareholders. We have paid out an interim dividend in November 2023 of EUR 0.5 per share. With that proposal, we would pay out a remaining EUR 0.6 per share in May 2024, obviously subject to market conditions and subject to the approval of the OGM.
Thank you, Veerle. So this brings us already to part four of this presentation, which are the conclusions. So I'll come back to the six key learnings that we've mentioned before, but which we feel are still very much applicable. So the first one is that the industry keeps on consolidating. And definitely, we want to continue to play a role in that. We see that big tech providers are in the place and increasingly buy sports rights, for instance. So that is definitely something that is also helping to fuel our growth. We see that infrastructure is the cornerstone of big changes at our customers. And we're happy to see that we are now playing very well in that environment. We see that the business models of our customers are shifting, sometimes slowly.
That move from CapEx to OpEx, some customers are doing that, but some customers stay definitely in the CapEx environment. We see that cloud is just one of the enablers. And definitely, as Benoit mentioned, the hype about cloud is over. Not that cloud will not be used, but with our balanced computing approach, we think that we definitely are providing the right answer. And all in all, as a conclusion here, we feel that EVS is on a good track and definitely on our way to realize our BHAG for 2030. What are our next key activities for 2024? What is in our focus for this year? Well, definitely, we see four major elements. So first, we keep consolidating our leadership in the LiveCeption environment. That is for us key.
The replays, the highlight production with LSM-VIA and XT-VIA, to name a few of our products in that environment, and also XtraMotion are key elements that help us consolidate our position in that environment. We are absolutely convinced that we can further grow in the MediaCeption and media infrastructure environment. Third is that we expect to be able to further grow in North America, especially. So we'll further increase our investments and focus on making sure that we further have capacity in North America to fuel our growth. And last but not least, we have a focus on selectively further develop adjacent markets or solutions. Those are our four main key activities for 2024. Coming to the conclusion on the next slide, we definitely are happy to see that our EVS PLAYForward strategy is bearing its fruits.
We start to see tangible proof points that our strategy is absolutely working. For 2024, we expect a controlled investment in our cost structure as to fuel our projected growth, though our focus on profitability will remain important throughout 2024. The revenue guidance is set at somewhere between EUR 180 million and EUR 195 million revenues, demonstrating that our focus on profitable growth continues. Veerle just mentioned again that our dividend will be EUR 1.1 for 2023 and that, of course, is subject to the approval of the ordinary general meeting. And last but not least, a specific point here I would like you to put in your agendas. The H1 2024 results will be announced on August 13. And that will allow us to make a call on August 14. So all in all, we're quite happy to celebrate 30 years of EVS with such greater results.
That's definitely a testament to all the work that the colleagues of EVS are doing worldwide. I take here the opportunity, definitely, to thank all of my colleagues for bringing us in such a good shape at our 30th anniversary. Definitely, we feel that this is just one of the milestones in our growth story that we further expect to bring us in that number one position by 2030. Again, thank you to all my colleagues for all the work that they are doing here every day. Thank you for attending this session. I guess we can go now to the question and answer part of our presentation.
Thank you, dear participants. If you would like to ask a question, please press star one one on your telephone keypad and wait for your name to be announced. To withdraw a question, please press star one one again. Please stand by. We'll compile the Q&A roster. This will take a few moments. Now we're going to take our first question. The question comes from the line of David Vagman from ING Belgium. Your line is open. Please ask your question.
Yes. Thank you. Good morning, everyone. Can you hear me?
Yes. We do.
Yes. Okay. Perfect. Thanks for taking my question and congratulations for this strong set of results and orders. First question on the very strong LAB sales, so LAB sales and the strong order intake for LAB. Can you roughly break down the performance between the LiveCeption tools, so for the LAB clients on the one hand, and on the other hand, MediaCeption and MediaInfra? Let's say really separate between LiveCeption and then MediaInfra/MediaCeption. Then on your 2024 so second question, on your 2024 cost base, can you give us your view, let's say, a bit on the bridge between 2023 and 2024, what we should have in mind for the gross profit, so let's say the cost of goods sold, gross profit margin, and the OpEx growth we could expect in 2024?
Maybe the scenario I realize that you have a sales range, and so the OpEx could vary. Last question. So on working capital, and thanks for the granularity provided during the presentation, can we still zoom on the issue? I was expecting more of a normalization in 2023 versus 2022. So after the hiccup, you had with the ERP launch. You're talking of a reclassification, I think, and then okay, some normalization. Should we fear there is any bad debt or clients paying? You're still waiting for some client to pay. Is there a structural change in the dynamic here? I think if we look back historically over the really long, long time, we are really at peak level for the working capital on sales, at the 50% you're talking about. It's materially higher. Is this the new normal, basically? Thank you.
Thank you, David, for your questions. We'll try to answer them as well as we can. Maybe to take your first questions about LiveCeption, MediaCeption, and MediaInfra within the LAB environment. Overall, we see our three main product families grow year after year. It's not that there is one going down and the others compensating. We see them all growing nicely in that LAB environment. We see also more and more customers having several solutions. That is a positive trend. That shows indeed that certain customers who had already, for instance, a LiveCeption solution are now also adding a MediaInfra solution. That definitely shows that our strategy for being able to also do cross-selling is helping us going forward. That's definitely something important to note.
We expect that further to bring positive results in the future as well. All in all, we see the three product families in the lab environment growing. The next question is about bridging the gross profit margin and the OpEx. I'll ask Veerle to comment on that one.
Yep. So I think, first of all, from a resource perspective, obviously, we have the flow-through of the inflation that we had in July 2023. The inflation was at 6.4%. And so we'll have that flow-through and impacting our 2024 numbers. And obviously, there will be a new inflation as well in July 2024. We do expect that inflation number to be much less important. So we're looking at a range 2%-4%, but I believe it's rather going down to the 2.5%-3% over the next couple of months. We will invest in some additional resources. As mentioned, it's a controlled investment in additional resources, primarily in sales support and so solution architects and primarily in the U.S. region as to make sure that we capture the potential there. We will obviously also have the impact of the depreciation of the intangibles.
As mentioned, it's a depreciation of EUR 0.5 million a quarter that has not to be forgotten. I believe also 2023, we had some one-off costs, as mentioned. Costs that will not repeat in 2024. You can size them around EUR 1 million-EUR 1.5 million. Finally, we do expect some reduction of our energy costs in 2024. On the other hand, our travel costs are likely not to go down. We don't expect that travel costs will become cheaper. Therefore, those two elements might compensate. I think this is the best guidance that we can give at this point in time in terms of expenses.
Good. The first question was about working capital, normalization, reclassification, fear for bad debt there. I guess Veerle can also give an update.
Yeah. So I think our net working capital, it's true. It's only an improvement of 1%. But as mentioned, let me first start with inventory. So inventory is really, really stable. So it's very stable the last 3 years at 19% of our overall revenue. As mentioned by Serge, with our lead times and with the delivery times that we get on our components that are actually worsening again, we don't expect that we can really ramp down on that inventory cost. You also don't have to forget that, obviously, in the inventory at end of December 2023, there are preparations for the big events in there. So that is obviously going to resolve in the first quarter of 2024. But definitely, we need that predictability in our production. And therefore, we need to make sure that our inventory is at the right level.
We have realized a stellar production in 2023 with the same team. Actually, we have made 100% of our deliveries in time. For us, that is critically important. That inventory, we expect that it will stay around 90% of our sales. We don't expect that we will see huge improvements over there. As mentioned, accounts receivable is something where we can improve. We, unfortunately, received around EUR 5 million of overdue invoices in the first days of January, so not in our cash per end of December. It's good to see that we're actually resolving it. It does require a little bit of our attention. As mentioned before, we see increasing business in the Middle East, but it's sometimes complicated to get the money in. We also see, yeah, some more issues in Latin America.
But I think together with sales, we are really having close contact with the customers, making sure that we also recover those situations. And especially if we can't recover it, we are systematically charging, actually, for interest fees. Obviously, it's not impacting our accounts receivable right away. But we're having the right conversations with our customers to make sure that we collect those receivables.
Yep. So if I can add to that, just one important topic. So we have, with our technology, the capability to switch off licenses. So we have a way for, I would say, making sure that the payments are being done. It's in our capability to not provide further licenses, which indeed would mean for the customer that his installation would stop. So that's a big leverage that we have indeed to make sure that those payments eventually are being done. And so to answer your question, David, is there a structural change in dynamic? I would say no. That's not the case. But by selling more into some regions where we know it takes some more time to get the money in, that is indeed just being translated in our figures of 2023.
Thank you very much, Veerle.
Thank you. Now we're going to take our next question. Just give us a moment. The next question comes from the line of Alexander Craeymeersch from Kepler Cheuvreux. Your line is open. Please ask your question.
Good morning. Nice set of results. Congratulations on that. I have a couple of questions. My first question would be twofold, and I'll ask them separately. So first, can we assume that the total revenue for the big event rentals will be, again, around EUR 15 million as was the case in big event years before? If you could just.
Are we listening to your questions and then answering, or how do we do?
Maybe that question separately, yes. And then I'll ask.
As from history. We see that our numbers for those big events are somewhere above EUR 10 million. That is typically the announcements we do. Will it go up to EUR 15 million? We will communicate later this year indeed more details about our order intake during Q1 and Q2. You'll have more clear numbers at that moment in time. But we see definitely that there will be nicely above EUR 10 million as we can see it at this moment. And again, those revenues are also linked to the setup, the type of setup. It also depends on the geographically spread of such events. Is this in a small environment, a small geographical area, or is this something which is spread over continents? That's also playing a role. But we feel we have the right orders in to do the big events of this year.
Okay. Well, the question would be a bit in relation to that big event rentals and then the guidance because you guided for EUR 180 million-EUR 195 million. That seems to suggest that there's going to be little to actually even negative growth in LSP and LAB. And I was just wondering why you were expecting this, or is this purely as a buffer for unexpected events? And then my third question would be on the competitors. You mentioned briefly that some competitors are divesting from the industry. Could you maybe elaborate on that comment and maybe even reveal which competitor that is? And then the last question, I was just wondering how many additional FTEs you were expecting for 2024. Thank you for that.
Okay. So thank you for those questions. So coming back on our estimates for the year, I think that you've seen us being cautious in the past about estimations. And we see no reason to change our approach to that. So we stay cautiously optimistic about our growth. And you've seen us now year after year overachieving. Well, at the beginning of the year, we always try to be as transparent as possible with what we have in hand and what we see. So that is from where our current estimate comes. So we feel quite confident that we'll be able to achieve that. But again, we are only in February. So there is still quite some activities to be done and quite some orders to be collected in order to achieve the year.
So we prefer indeed to provide figures of which we feel quite confident that this will become a reality. Then talking about the competitive environment, it's true that we see certain of other players in our industry moving into other directions for specific reasons. And all of them have their specific strategy and their specific objective. But what we can say is that, in general, we see our total addressable markets that's something we also said during the investor day last year. We see our market not growing hugely. I don't expect our market to increase with a CAGR of 10% or more. So we see some competitors going into other directions to try to gain revenue increase. And we have to remember that the market that we serve is the live broadcast industry, which is in quite demanding customer environments.
Customers, like important broadcasters around the world, put heavy stress and high expectations towards their technology providers. We've seen some of the players in our industry going other directions, preferring to serve other type of customers, which will be less demanding, but where they can sell more in a copy-paste type of approach. We definitely don't go into that direction. We absolutely feel that we have an edge to serve customers, demanding customers. That is being seen in our numbers and in the strategies of some of our other players in our industry. There are different companies indeed going into other directions and who are leaving space for us. That is indeed helping us going forward in our environment. If we look to some of those players, well, you see players that are doing well, for sure.
But by going into other directions, I take one example. Avid was until recently a U.S.-based or is still a U.S.-based company, but is not listed anymore. But that is a nice example of a company which had put into place another strategy of doing more recurring revenue with other type of customers and less with broadcasters. So again, they're doing very well, but they go in a different direction and with other type of customers than the ones that we serve in the live broadcasting industry. So I hope that that helps on that question. And then I'll let Veerle comment on the evolution of our team in general.
Yeah. So actually, we work with it. It is given we're a company in growth mode, for me, it's very important that we model our growth and we adapt our growth numbers to what we see happening in the market. So we work actually with a phased budget approach. And actually, for the first phase and revenue guidance that you see right now, we expect a total increase in our team members between 15-20 FTE throughout the year.
And again, that is our current understanding. If we see business going in one or another direction, we might take other decisions to accelerate hiring or to slow down hiring, of course. But that is something we will continuously monitor to make sure that we are in line with expected profitability.
Okay. Thank you. And maybe one additional. Could you repeat how much the one-off cost was in your numbers?
It's approximately EUR 1 million-EUR 1.5 million.
Okay. Thank you very much. I'll leave the floor to my colleagues.
Thank you. Yeah, participants, just a quick reminder. If you wish to ask a question, please press star one one on your telephone keypad. Now we're going to take our next question. The question comes from the line of Guy Sips from KBC Securities. Your line is open. Please ask your question.
Yes. Thank you. And also congratulations from my side. Three questions. First, on the success of your channel partner program, can you quantify that a little bit in growth year-over-year or something? And then the second question is on the price increases. So you had a last price increase in February 2023. There was no price increase of your products in September. Is there something planned for in February 2024? And then you were stating that you want to double down in North America. Is that organic, or how do you see that? Thank you.
Okay. Thank you for your questions. Talking about the channel partner program, it's clear that we've seen quite some nice growth, especially in North America. That's also where we've been putting most of the focus to grow our partner program. While we have already quite some nice partners in Asia and also more and more in Europe, Middle East, and Africa, definitely the biggest part of our channel partner program growth came out of North America. The program is also very much focusing on media infrastructure in that respect. We see quite some value to bring this type of technology to the market through channel partners because they not only do resell, but they integrate it with other solutions, or they add additional value by doing all the integration work and the change management work.
So in that respect, channel partners are becoming more partners who add value by doing the design, implementation, integration of our solutions. Overall, we see that part of our business increasing. We don't give specific numbers around how much that generates in revenue, but it's definitely an important part of our growth. Then to answer the question about North America, definitely doubling down for the moment is still on the organic part. Maybe that in the future, it will be also supported by external growth. But we still see for the moment that there is sufficient potential growth just through organic growth. So that is definitely something that we're focusing on. And then for the price increase, I'll leave the floor here to Veerle.
Yeah. So definitely, there is a price increase plan in 2024. It's actually planned in 1st of March 2024. It's not a one-size-fits-all approach anymore. So it's really very different by solution. I think overall, the increase is between 0%-10% depending on the products and solutions at the base. On average, you may expect that the price increase is approximately 4%.
Okay. Thank you, crystal clear.
Thank you.
Thank you. Dear participants, as a reminder, if you wish to ask a question, please press star one one on your telephone keypad. Now we're going to take our next question. The question comes from the line of David Vagman from ING Belgium. Your line is open. Please ask your question.
Yes. Thank you. Just a quick follow-up on the net promoter score chart and the evolution since 2021. Could you explain to us why, even if it's still positive, it was still positive in 2021, whether there was anything particular that caused the NPS to be so much lower? And do you have a history which is a bit longer dating back from, I don't know, even before COVID, to give a broader perspective on the NPS evolution? And maybe explain a bit what you think you've been doing better in particular. Thank you.
Okay. Thank you, David. So I think that what you start seeing in that NPS evolution is the result of our strategy and our customer intimacy approach that we have put forward in our PLAYForward strategy at the end of 2019 and which we started implementing, well, in 2020 during a COVID year, but which started to have full effect as from 2021 onwards. So you remember that EVS went through a challenging period from 2012 to 2019, which was translated also in a negative trend regarding revenue evolution. And it's from 2021 onwards that we see a break with that trend, which is in line with our strategy and the way that we approach our customers and the evolution of our product portfolio. So I think that those are some of the most important elements that contribute to an evolution of the NPS.
If you ask me what was the NPS before, we don't have. We did not keep track of that before. And again, this is an element and a KPI that we have added in our strategic intent when we started working with PLAYForward . So we definitely put this as a KPI to make sure that we are progressing in the right direction. Okay. Thanks very much.
Thank you. Dear participants, just a quick reminder. If you wish to ask a question, please press star one one on your telephone keypad. Just give us a moment. Now we're going to take our next question. The question comes from the line of Michael Roeg from Degroof Petercam. Your line is open. Please ask your question.
Yes. Good morning. First question is on VIA MAP that was launched at the end of last year. Could you tell us a bit about how the customers have been responding to it? Have you seen many trials from customers? And also, do you have a sales target for a period of, say, five years from now, how it should evolve?
Okay. Michael, thank you for your question. So VIA MAP was announced and launched during IBC last year. And definitely, we get quite some positive traction. We see also more and more customers, which we call aware in our white space, so customers that we were not serving before who are now knocking on our door with this solution. So definitely, we see quite an increasing interest. And again, not only from existing customers, but also from new customers, which are important broadcasters, even news customers around the world. So we definitely see a very positive momentum in that respect. We definitely have objectives for the future, which contribute to our MediaCeption growth in general. We are not communicating on specific VIA MAP sales objectives, but definitely, it's contributing to our growth of both our MediaCeption and our LAB customer pillar.
So in that respect, we absolutely are convinced that it will help us to generate the expected growth for the years to come. We see that on MediaCeption side, our market share is what it is today and that there's quite a growth potential for us over the next years. And we are absolutely convinced that VIA MAP will help us unlock that further growth in the market share.
Okay. That's clear. And then based on the comments by Veerle, that there's still a little bit of capitalization left for that second product, it's only a tiny bit that suggests that you expect to launch it probably within the next three to six months. Is that correct?
The launch is foreseen in 2024, so.
2024. Okay. Good. Then my second question is on the gross margin. One of the things mentioned in the press release was that it benefited from a few things, including proportionally more software within the solutions. Is that something that you expect to remain like this so that the software component within the mix remains at a high level, thus benefiting the gross margin going forward?
So I'll start with a part of the answer, and then I'll hand it over to Veerle. But remember, indeed, from the 620 colleagues that we are now, close to half of all our team members are engineering. And in the engineering team, more than 80% is working on software. So it's important to understand that we have a huge focus on software that just not always is reflected in our revenue splits, of course, because software goes also sometimes on hardware. And that's also the case for XT-VIA servers, of course. But there is no doubt that software will continuously increase in importance in the future. We also expect that we'll be selling more software solutions as such, also even in the media infrastructure environment where a solution like Cerebrum is mainly a software solution that we provide to our customers.
So software as such will become increasingly further important. But again, we have already 80% of our engineers working on software. That also already gives you an important element or indication of how important software is. And then we feel a further comment on that.
Yeah. I think also for the next few years, we definitely do expect to inject more and more software into our cost of BOM, making sure that we optimize the profitability of our solutions. But on the other hand, you also don't have to forget that the impact of the mix will probably counterbalance that effect. So we don't have huge expectations of increasing the margin. Definitely don't forget the dilutive effect of operations cost as well in 2023. But yeah, we do expect those two elements to somehow counterbalance in the future.
Okay. But if I then add the launch of VIA MAP, pure software product, suppose that that ramps up over time and becomes a bit more important in the mix, it will benefit your gross margin. And we don't know yet what the second product is, but should that be software as well, then that could be a second driver for gross margin expansion. Now, you have shared a long-term sales target for 2030, EUR 350 million-EUR 400 million organically and M&A. But if software keeps becoming more important in the mix from new products, amongst others, would it be fair to assume that by then, maybe the gross margin can expand to, say, 75% like many years ago?
I would say don't expect that automatically to happen. It will also depend on the acquisitions that we do in our industry. We see that customers are still very much focused on having equipment on-prem, be their own commercial off-the-shelf equipment, our own hardware solutions. It's definitely too early to expect that to happen, to further see that gross margin increase. Our objective is to increase revenues, increase bottom line. But it might be that this is being done just with a similar gross margin, maybe a little bit higher, maybe a little bit lower. That will really depend also on the acquisitions that we'll do in the future.
Yeah. And don't mind also the operations costs. We continue investing in operations costs because we continue to see that we need to accompany our customers in the change and transformation that they have in front of them. So that support is very important to us. We want to make sure that that remains at a very high level and a high quality. So we will continue investing in operations as well, which will also obviously impact the gross margin.
Yeah. I think that's an important element because that underscores, again, the remark I made before about competition going into another direction. What this means, indeed, is that we have to offer quite some services to customers to make sure that they are able to progress. We like often to say that the technology that we are providing is like an ERP system. It needs to be implemented, installed. Workflows have to be changed. So it's not just a piece of technology that we drop at our customers. It needs quite some additional services around it to be implemented, services that can be supported or provided by us or services that are being implemented and provided by our channel partners.
Okay. It's clear. I'll be careful not to extrapolate the gross margin too much. Thank you.
Thank you. There are no further questions. I would now like to hand the conference over to Serge Van Herck for any closing remarks.
Okay. Thank you. So again, thank you for attending our call here today. As you can hear and see, we are quite happy with the progress that we've been doing over the last years. Our PLAYForward strategy is definitely bearing the fruits that we were hoping for. And we think, indeed, that we are well on the way to be able to achieve our BHAG, which is to become that number one technology provider in our industry. We know definitely we still have some challenges, but we clearly see the opportunities in front of us. So in that respect, we definitely remain cautiously optimistic for the future. And that is also already being translated in our guidance for this year where we see effectively that our revenues for 2024 should go into the EUR 180 million-EUR 195 million. So that definitely shows our approach of being cautiously optimistic.
Again, we are quite happy to be able to celebrate 30 years of EVS in such a way, again, at a historical revenue level. It's our intention to continue that way, of course. I take the opportunity to thank all of our shareholders and analysts, of course, for your continuous support in this growth story that EVS is putting on the table.
That does conclude our conference for today. Thank you for participating. You may now all disconnect. Have a nice day.
Thank you. Have a nice day.