Good morning, everyone, and Welcome to the presentation of Norconsult's third quarter results. My name is Egil Hogna, I'm the CEO of the company, and I will present the results together with our CFO, Dag Fladby. On the front page of our presentation today, we have a picture from the beautiful rehabilitation of the Arna Station in the western parts of Norway, where Norconsult has been nominated to the Norwegian Lighting Prize 2024, and a prize from the Bergen Municipality for the lighting of this project. Today, we will tell you about a quarter with solid growth and improved profitability. But first, I'd like to remind you about some of the basic facts about Norconsult, as we are still a fairly young company on the stock exchange, even if we have 95 years of history.
We have six business areas: the Norwegian Head Office and Regions, Sweden, Denmark, Renewable Energy, and finally, Digital and Technogarden. We have a bit more than half public revenue, or revenue from the public sector, and a bit less from the private. Three main markets: Buildings, Architecture, Infrastructure, Energy, and Industry. And also, during this year, we continue to show profitable growth with a stable profitability. This quarter, we have increased the number of employees by 200, so we are now at 6,500 employees in total at the company, and we have 140 offices across the Nordic Region and Poland. During the third quarter, we saw solid growth and improved profitability. Our net revenues increased by approximately 13% to NOK 1.9 billion, and in this quarter, there were no significant calendar effects, making it a little bit easier to interpret the results.
The organic growth was 11%, and our adjusted EBITDA increased by approximately 50% to NOK 162 million. That gives an EBITA margin of 8.4%, and when we adjust that for the calendar effect, the EBITA margin was 8.6%, which is a nice 2.2 percentage points increase from the same quarter last year. The markets have all in all been in line with the previous year. Buildings and Architecture still has quite a bit of variability, with the private market still being influenced by uncertainty and the higher interest rate environment, which is still putting a somewhat gloomy mood on the private part, mostly exposed to interest rates. However, we are seeing a little bit more uncertainty in the market with the Norwegian municipalities, but all in all, the public part of the market is quite stable.
We've also seen an increase in defense-related spending and still a solid demand from the public sector overall. Infrastructure continues to be characterized by a stable market. We see a shift from some very large projects to a higher number of smaller projects, but the total demand is quite constant, and that is the same for water infrastructure. Energy and Industry is all in all our strongest market, in particular when it comes to energy. When it comes to industry, there are differences between the sectors and the geographies. Industry is performing the best in the Norwegian and Danish market, while it is weaker in Sweden. In this presentation, we have selected one special topic which we would like to go a little bit more in detail on, and that is people and organization. Because in Norconsult, we don't have any fixed assets.
Our people are our assets, and how we recruit, develop, and retain our people is crucial to the success of the business. So we pay a lot of attention to this, and I would like to show you a short video illustrating how our project managers are participating in transforming and building the local societies where they live and operate. So please have a look at this short video.
[Foreign language] Ja, hva var det som gjorde at jeg hadde lyst til å flytte tilbake til Steinkjer? Vi har jo fått være med og skapt mye nytt her, da. I et forprosjekt til denne parken, så fant man ut at man kanskje følte seg utenfor i Steinkjer-samfunnet. Det var jo unger selv som kom med innspill til denne lekeplassen i form av tegninger, blant annet zipline. Denne parken ikke kun for barnefamilier. Kommunen bestilte en park som også kunne brukes som hovedscene til Steinkjerfestivalen. Her var jeg for en vekkelse, faktisk. Med kulturhusprosjektet så ønsket vi å gi noe tilbake til alle i form av et godt uteområde og en elvepromenade langs elva. Kulturhuset ser vi at det betyr veldig mye for sentrum. Med både folkeverksted, bokbad, et fantastisk bibliotek, møterom, studieplasser og et supert kulturtilbud. Steinkjer er en fantastisk opplevelse.
[Foreign language] Det er noe helt nytt som, så vidt jeg vet, bare finnes i Steinkjer. Her kommer man tett på å oppleve digital kunst med fantastisk musikk. Det å være oppdragsleder og kunne bidra med økt attraktivitet for Steinkjer sentrum, det føles veldig givende. Beredskapshuset inneholder mange funksjoner, både helse, brann, utrykning, legevakt og rehabiliteringstjeneste. Beredskapshuset er jo lagt til byens fineste tomt, og da ønsket vi å skape et uteanlegg som kan brukes av ansatte og brukere, men også de som går forbi og har parken som et turmål. Det er jo viktig for et lokalsamfunn å forebygge utenforskap, og egentlig så er det den jobben vi gjør. Jeg blir stolt av den jobben jeg har.
So this video is one of eight which we are gradually releasing over the coming months on social media and YouTube, demonstrating both to students and professionals who might consider joining Norconsult to better understand what we do and how we impact our societies. Human resources is very important, as I have mentioned in Norconsult, and one way we are demonstrating that in practice is that we have lifted HR to the top of our organization by appointing Marisa Ruiz Retamar as our new EVP HR and a member of the Corporate Management Team. During the quarter, we have also had our annual employee satisfaction survey, which had this year more than 90% participation rate, and we had continued high scores in general. However, every year we learn something about the different parts of the organization where we have improvement opportunities, and we follow that up in the coming months.
This quarter, we have also been certified for the first time with the ISO 27001 certificate for information security. Not too many companies have this kind of certification, but for us, it is important to help us make sure we have a high level of cyber security protecting our customers' interests, and finally, as I briefly mentioned in the introduction, we have this quarter increased the total number of employees in the company by 200, and it is quite typical that we see an increase in the third quarter because that is the time of year when we have most freshly educated graduates joining our company. This year, we have so far had 150 graduate recruitments, and this summer we had 120 summer interns, and you see some of these happy people on the photograph on this page.
We use the summer internships in order to make sure potential recruits understand us well before they potentially get a job offer from us, and we believe that the summer internships we have are a key reason why we continue to have a low employee turnover in our company. We have also this year again been nominated as the most attractive engineering consultant employer in the Universum Student Awards. The student award we got in May, and actually during the third quarter, we also got the award for most attractive engineering consultant employer for younger professionals. That one we got in October. We also try to have a strong visibility at the university through career days. This week, I have myself been to NTNU in Trondheim, meeting with students there at the Department of Engineering Science.
I talked a bit about recruitment of experienced professionals, and for us, it is important to have and maintain a balance between younger and senior employees, and because of that, we try to make sure we also recruit experienced people with specific knowledge that is particularly important for us both to win and perform assignments for our customers. We demonstrate to them that we have a dynamic and innovative environment with exciting projects and a strong local presence, as you saw in the video. I mentioned that we won the Universum Award also for professionals this year, and in Sweden, we were again appointed a so-called career company for young professionals this year.
Then I'd like to say a few words about our projects, and this quarter, we were very happy to win some awards for our projects, and Autodesk, which is the most important supplier of software to engineering companies worldwide, actually provided us with two awards this year, which in total means that we have won six awards at Autodesk events previously. This was awarded in San Diego, where there were 12,000 physical participants and 20,000 online participants to this event. It is the largest one in the industry, and we won the prize for most innovative use of Autodesk Platform Services for our Sotra Bridge, which is a bridge project just west of Bergen, and the entire bridge has an all-encompassing digital model, which you can see an excerpt from on the picture. We've also had a number of other projects, and I will show you a few representative examples.
Here we have one from Sweden, where we have gotten a two-year extension of our project at Mälarbanan, which is part of the local commuter train system around Stockholm, where we are working on the water and sewer systems and the general traffic measures for cars, bicycles, and pedestrians around the train system. The customer here is the Swedish Transport Administration, or Trafikverket, as they say in Swedish. Another project is the Liåsen Transformer Station. This is just outside of Oslo, connecting the central power grid in Oslo to the high-voltage 420 kV line, and this is built in order to increase the capacity for future development in southern Oslo, and here we work on the detailed design for the entire facility. Another project is the reconstruction of the Braskereidfoss Dam. Some of you might remember that last year we also had some extreme weather.
This year we had Jakob, last year we had Hans, and unfortunately, this dam was severely damaged by the flooding of Norway's largest river, Glomma, during this extreme weather. We are helping the owner of this dam, Hafslund Kraft, with the reconstruction, with the rebuilding, and measures to improve the operational safety of the floodgates, which was the part of the dam which failed during last year's extreme weather. And then last but not least, we have won a project for Norway's first major offshore wind project, Sørlige Nordsjø II. This is the major offshore wind project which has now been launched in Norway.
It is a pioneer project in Norway, and we will work with Ventyr, the joint venture consisting of Parkwind and Ingka Investments, on the environmental impact assessment program, both on the nearshore and onshore part, in order to find the most sustainable solution for bringing the power to shore. So with that, I would like to give the word to our CFO, Dag Fladby, who will talk more about the financial results.
Thank you, Egil. And on this page is the second project which got the award on Autodesk in San Diego last week. This is the new government quarter. Third quarter was a solid quarter with good growth and also improved profitability. Our net revenue ended at NOK 1.9 billion, up from NOK 1.7 billion. And as Egil mentioned, there were limited calendar effects in the quarter. Our organic growth was 11%, driven by increased FTEs and also increased average billing rates. This was partly mitigated by lower billing ratio. Our billing ratio was 71% in the quarter, and in third quarter, which is always low season for the billing ratio, as we do significant recruitment from graduates from the university, and that is also the case in this quarter.
It was slightly down from the same quarter last year, and that is mainly due to a continued weak market in Building and Architecture affecting the Norway Region the most. Our EBITDA ended at NOK 162 million , up from NOK 108 million , with an underlying margin of 8.6%, up from 6.4%. We have included increased provision for the profit sharing, as we mentioned in quarter two, but that is partly mitigated by higher billing rates and also cost efficiency measures, improving the margin. Pre-tax profit, NOK 53 million . That includes also provision for the gift shares of NOK 83 million in the quarter. So adjusted for that, we have an increase of NOK 56 million versus the same quarter last year. A short look at the EBITDA contributors before we dive into the segments.
And as you see from this graph, four of our six segments have improved EBITDA during the quarter, driven by Norway head office and also Sweden and Renewables. On the right side of this graph, you see the calendar effect, which was minor. It was NOK - 4 million , even though it was one calendar day more. And that is due to that it was two calendar days more in July, where most of our people have vacation, while in August it was one less than NOK 4 million in minus. That was also slightly lower than we guided in quarter three due to more vacation takeout in the period. And moving into the segments, we start with Norway head office to the left, which continues with a strong organic growth and also solid profitability. Our net revenue ended at NOK 563 million , up from NOK 507 million , and organic growth was 10%.
It was driven by increased FTEs, but also increased billing rates and also continued high billing ratios. EBITDA at NOK 60 million, up from NOK 35 million same quarter last year. In addition to higher billing rates and solid billing ratio, we also have effects from continuously cost efficiency focus. A remark from last year, last year included a one-off cost of NOK 10 million due to restructuring of the architecture business. In Norway Region, we have an organic growth this quarter of 9%. That is an increase from second quarter, where we had 6%, and in third quarter, 3%. Net revenue ended at NOK 554 million, up from NOK 509 million. The drivers behind the growth were increased FTEs and also increased billing rates. EBITDA at NOK 40 million, slightly down from last year, and also the profitability is slightly down.
It ended at 7.3% versus 8.4%, and it's still affected by too low billing ratio, but it's partly also compensated by good project execution and also results from cost efficiency measures. Moving into Sweden, Sweden continues with very strong organic growth of 19%, but also improved profitability in the quarter. The drivers behind the growth are increased FTEs, increased billing rates, and also higher billing ratio. EBITDA at NOK 11 million versus NOK -10 million last quarter and the same quarter last year. The main reason for the improvement is effects from the senior recruitments we did last year, increasing billing rates as well as cost efficiency measures. I remind you that last year included a one-off of NOK 10 million from the senior recruitment, NOK 10 million in cost. In Denmark, our net revenue ended at NOK 172 million , up from NOK 150 million , and a 9% organic growth.
The growth is due to increased FTEs and also some write-ups from the fixed price projects. EBITDA at NOK 15 million, same level as last year, but last year included a positive earnout of NOK 5 million. The figures also include NOK 4 million provision, as mentioned before, related to the leverage penalty and earnout agreements, which is a non-cash item. Into Renewable Energy, and Renewable Energy continues very strong with a growth, organic growth of 20%. That is mainly due to FTE growth in the core activities, increased average billing ratios, and also continued high billing, increased billing rates, and also increased high billing ratio. As you may recognize, the segment has actually reduced FTEs in total, and that is due to that we sold our Philippines operation in first quarter and also some reduction in employees in Poland. These units have no significant effects on revenue and EBITDA.
We still recruit strongly in our main contributor in this segment, and that is hydropower and transmission. EBITDA at NOK 26 million , up from NOK 15 million , and a strong EBITDA margin of 14.8%. That is the main driver there is hydropower and transmission with a solid performance. Then finally on the segments, Digital and Technogarden, on total revenue we have an increase of 3%, mainly driven by increased use of subconsultants in Technogarden, but also increased sales or licenses in Digital. EBITDA at NOK 22 million , up from NOK 20 million , and the main increase there is Digital, where we have a higher capitalization of development cost and also reduction in cost due to reduction in FTEs during the last quarters. We have continued to do measures to improve the profitability in Digital. In October, we had to temporarily lay off around 15 people.
However, that is now, as we speak, down to 12 since we have in the last week won a couple of new projects where we actually need the resources back. So that is illustrating that this is a dynamic approach where we adjust accordingly. Then to cash flow, and cash flow is affected by seasonalities. And the third quarter is always the weakest in our industry, at least for Norconsult. Cash flow from operation in third quarter was NOK -126 million versus NOK -21 million in the same quarter last year. The reason for the decrease in cash flow from operation is increased working capital, especially on revenue and the latter part of the quarter.
Cash flow from investing activities, NOK - 71 million versus NOK -107 million, and the slight improvement there is payment from the employee share program as we launched in the end of second quarter with payment in third quarter. Our balance sheet is strong. We have cash and cash equivalents, so NOK 815 million. The same quarter last year was NOK 1.1 billion, but a reminder that we paid out extraordinary dividend in fourth quarter last year of NOK 600 million. Our leverage ratio, minus excluding IFRS, is - 0.92, and we don't have any drawings under our facilities. Our order book at the end of the quarter ended at NOK 6.3 billion, and that is nearly on the same level as quarter two. We may see a different ratio between LTM revenue, net revenue, and order book going forward.
And that is due to that there are fewer very large projects in the market in line with the Norwegian National Transportation Plan, which has shifted the focus from the very large to more medium and smaller projects. That may affect the size and the length of the order book going forward. At the same time, we also realize that a larger part of our revenue is coming from framework agreements. And for example, increasing market segments like defense, they use mostly frame agreements. And frame agreements, as you remember, we only include what is called off from the frame agreements and not the frame agreements as such. And finally, from my side, a reminder of the seasonality in our business, and at the bottom right here, average working days in fourth quarter seems to be one working day less.
However, the reality is a few hours less, so we guide the effect, the calendar effect, to be around NOK -16 million in fourth quarter. And by that, Egil, you will give us the outlook and some closing remarks on quarter three.
Thank you, Dag. So all in all, we find the third quarter to have been a strong quarter. Normally, it's the seasonally weakest, but it came out a bit better than we had expected. And all in all, we consider the market to be fairly stable, but there is still uncertainty. And the uncertainty continues to be linked to interest rate levels, macroeconomics, and now most recently also, of course, outcome of elections and potential reactions to that.
We continue to see small signs of improvement in the market for Buildings and Architecture because our market seems to get used to the fact that interest rates are a little bit higher and that potential interest rate drops may take some time to materialize, at least in the Norwegian market. In infrastructure, the demand is stable. As our CFO mentioned, we see less of the largest projects, but the total demand is stable because the total number of projects has increased with more smaller to medium-sized projects. Activity remains strong in the energy sector, and then industry is really a mixed bag where, for example, the automotive industry is struggling while other industries are doing quite well. Norconsult has a strength with our flexibility because we have specialists in different discipline areas who are able to move across different market areas as demand fluctuates in these market areas.
That is a fundamental strength which contributes to our stability. However, we are also working to compensate for inflation and increasing cost levels, which we also experience, for example, in the IT area, and we continue to take proactive measures to improve our underlying profitability, to find efficiency improvement opportunities, and to make sure we manage costs in the best possible way. For the very short-term outlook, I would also like to remind you that on Monday, it is one year and one day actually since we were launched on the stock exchange. That means that we will, at that point in time, have 100% free float. The lockup is expiring for the last 35% of the shares. And at that day, we are also distributing the so-called IPO gift shares to the employees who were employed in the company at the time of the IPO.
That is quite a nice gift for our long-term employees with 2,575 shares distributed to more than 5,000 employees over the weekend. With that, we have concluded our presentation, and we would like to open up for questions. You are invited to put in questions digitally, but we will start with questions from the audience in the auditorium. Martina, I think you were the first one.
You are able to increase the billing rates quite a bit. Can you say something about the development for and kind of what do you see with a higher amount of smaller projects? Are you able to, how do you see the competition there?
I would like to invite our CFO to answer that question, but as you got the microphone a bit late, I'll try to repeat it quickly.
The question is about billing rates, which were improved in this quarter, and you asked how they potentially might develop with a larger share of smaller projects. Dag, would you like to comment on that?
Yeah, I don't think we will see a big difference in the short term on the smaller project. That is more, you can say, medium term. It depends on the market. In Building and Architecture, it's very high price competition, while in other segments, it's more normal competition. So I don't expect very much change actually in the short term.
Thank you. On the billing ratio, when you see the development now compared to last quarter, how would you see that going into Q4? You see the activity there, and what do you like to see in the architecture and building market?
Will we see it decrease year- over- year, or can you give some comments on that?
Well, the billing ratio, which is essentially the utilization of our workforce, is seasonally always the lowest in the third quarter because that is when we have the most new hires and fresh graduates out of university. So as such, the number we showed for the third quarter should not be a surprise to the market, at least not in a negative sense. We expect that to improve in the fourth quarter compared to the third, which is seasonally normal. We have also seen that it has increased during the third quarter. Whether we will reach last year's level or not is simply too early to say.
And then last, and a bit connected, how do you see development in Sweden going forward? And if you can give some comments about the market development around there.
Sweden has performed nicely in the third quarter. We are very happy to see that the very large majority of our senior recruitments last year are now fully employed in Sweden in billable work for our customers. So we are happy with the development in Sweden. We see that the Swedish market is a little bit more challenging than the Norwegian. I think that is fair to say. In particular, Swedish industry is struggling somewhat. But all in all, we also see that Sweden is starting to see some positive effects from the interest rate reduction, which we have seen in Sweden. So all in all, the Swedish market is tough, but it is doing reasonably well.
Great, thank you.
Magnus Rasmussen, SEB. I think you said that Q3 was also better than you expected.
I think it certainly was true for most of us on the outside. Can you explain what was better than you had expected?
Yeah, when you ask the more detailed question, I think I'll refer to our CFO.
I think we saw, when it comes to the revenue side, we saw quite, as I mentioned, also in cash flow on the left part of the quarter, we had a very good growth rate, also affected by the new employees, of course, but that was maybe slightly better than we expected.
And it seemed, given that you have 11% organic growth, 45% FTE growth, it seems that there are some quite big billing rate increases. Is that due to some sort of mixed effect or anything, or is that sustainable also in the coming quarters?
I think it always is a balance between the portfolio, of course, but I don't expect any major changes going into fourth quarter. That does not mean that it will increase at the same level as from quarter two to quarter three. So we work continuously on getting the best prices on new projects. We are very committed to not lower prices too much in, for example, the tough markets. And so that is an effect of the total.
And one final question. At Q2, there was a NOK 24 million effect of periodization of profit sharing or bonus payments or bonus costs. You say that's a negative effect year on year. This quarter, can you say by how much of that NOK 24 million is sort of reversed this quarter?
Most of the, as mentioned in quarter two, most of the headwind of NOK 24 million was taken this quarter.
Thank you.
I think there are some questions a bit further in the back.
Thank you. Njål Kleiven, ABG. First of all, could you give us an update on the architecture and how the architecture market has developed since the last quarter and also split that down into Norway, Sweden, and Denmark, please?
So let's try to say something meaningful about that. I think it's fair to say that the architecture market is still challenged. But we have seen quite a bit of improvement in Denmark. So if you ask me to rank them, I think I would say that Denmark is currently the one which has, let's say, improved the most. It is challenging in Sweden, and it is challenging in Norway. But what we are seeing is that the number of public projects, so public buildings and also some infrastructure where architecture is important.
I mean, I showed, for example, the Sotra Bridge. Architects have also been involved in that, for example. That part of the market is doing reasonably well. So last year, we did unfortunately have to do some reductions both in Denmark and in Norway, not in Sweden. Right now, we are hoping that we are not having to do any more reductions in the architecture segment. But as we also wrote in our outlook statement, minor capacity adjustments, that's something which might occur. But we see some increase in the architecture segment, and we are happy to see that and hoping that it will continue because, as I also mentioned in the outlook section, we continue to see small signs of improvement in the buildings and property segment, which is the most important for architecture.
Thank you. And another question on billing rates.
That's a quite significant increase, at least when you calculate the outside-in in billing rates this quarter. Is that mainly driven by price increases on large projects with a price adjustment mechanism in it, or is it more new projects coming in with a higher pricing point than what's going out of the order backlog?
It's a mixture. It's both a new project coming in. It's also a mix of what you actually work on in the quarter. And I will not say it's a huge price increase. When we have the figures internally, it's not a huge price increase. It is, I will say, we are satisfied with it, but it's not huge.
I guess I could add that as our CFO also mentioned during this quarter and the same quarter last year, there were also some one-time effects which have some impact on the revenue side as well.
And you're talking about a change from a large project to a more smaller project. If you speak historically, is there a difference between in the margin potential in smaller contracts versus larger projects?
Our CFO touched on that previously during the first question, but I'd like to say that the main difference we see is between different markets. So, for example, buildings and property tend to have lower rates and margins compared to at least normal infrastructure projects. So there is less of a difference between the relative size of the projects. So, for example, an infrastructure project typically has the same rate and the same margin independent of size.
Thank you. And one last question from me. You have slightly higher capitalizations in the Digital and Technogarden segment this quarter. Is this a one-time effect, or should we expect higher capitalizations going forward?
That is more a one-time effect with a product we work on.
Thank you.
Hi, Jenny Pedersen, Carnegie. You were talking about, I think the talk about defense projects have gradually ramped through the year, and Q3 seems to be the first quarter where this is really hitting the books for a lot of your competitors as well. I think, would it be possible to share if there are any differences in margins when it comes to defense projects versus more the conventional Building and Infrastructure projects?
I think the short answer is that there are no major differences. If you look at our defense-related projects, it's mostly buildings, and the margins are typical for building projects because the capabilities and skills are roughly the same. There are a few extra requirements, meaning extra costs related to defense projects.
That also means that the rates are a little bit higher, but margins are then fairly similar.
Okay, thank you. And then my second question is whether you see any risk in relation to utilization given the new order book mix with less large projects and more smaller ones.
Should I answer? Yeah. No, we don't see any change in how we operate. To have a good utilization is a mix of the total portfolio from large, medium, and smaller. So we don't see any challenges on that.
Okay, thank you.
I don't see any more hands in the auditorium, and then I would like to hear if we have any questions which have come in online.
Yeah, so we have a question from Jesper Stegumo from Handelsbanken.
So could you please break down your energy segment and give some more details in what areas you continue to see elevated demand and if there are any weaker areas plus where you see more uncertainties and increased risks for projects being postponed and canceled as we've seen in a few renewable projects recently? And if you can also describe how you work internally to follow up on contracts and evaluate project risks in your pipeline.
Okay, maybe I can start on breaking down a little bit the demand picture in the energy segment. We continue to see hydropower and transmission as the, let's say, the strongest demand in the Renewable Energy segment. There is demand on wind, which is also quite okay, both some land-based projects, mostly early phase, and as I presented, offshore wind in Norway.
But I think it's fair to say that there is a bit of headwind in wind-related projects, but there is maybe a little bit more going on than what you sometimes get the impression of in media. Solar has been a little bit disappointing. We continue to see quite some healthy activity relating to solar on buildings, but we see a little bit less than we had expected on ground-mounted solar. So solar parks put on the ground, there we were hoping to see more demand compared to what we are currently seeing. So I think for Renewable Energy, that is the picture. And then I don't remember the second part of the question, so maybe you will repeat that.
How you work internally to follow up contracts and evaluate project risks in your pipeline?
No, that's a thank you question.
I think it's worth to remember that 80% of our projects are time and material, and around 20% then fixed price. We follow up this every week, every day with a different level of management, with good system support. And yeah, that's a monthly go through on every project. So I think we have quite good processes related to that.
Thank you. And another question from Jesper. It's regarding the defense-related spending. So are these contracts typically large and long-term, and do you expect the collaboration across borders between, for example, Norway and Sweden, and how much of the total infrastructure pipeline is related to defense?
So the frame agreements are fairly large, but projects are usually divided into fairly small pieces, at least the ones we have in our portfolio. So there is a high number of defense-related projects, but each one of them are fairly small.
Mostly building-related, but also related to other infrastructure. We do expect to see more cross-border projects in the future. For now, that is very limited.
We have a question from Johan Sjöberg from Carnegie. How much headwind should we assume you face from higher bonus provisions year over year in Q4 2024?
Yeah, and that is related to the change in bonus provision from second quarter. Most of the headwind we took in quarter three, so it's only a minor effect in quarter four. All like for like. All right.
Another question was how much higher was the capitalization in digital this quarter versus Q3 2023?
It's minor figures, but since the EBITDA figures are small, it's around NOK 3 million . All right, thank you. That's why we commented since the EBITDA on the segment is very small, it's to be open on the development.
So it's only a minor part in the total group figures.
Thank you. That concludes the question.
So that was the last online question. I see no further hands here in the auditorium. Then we would like to thank everyone who has followed us for your attention and have a nice day. Bye-bye.