Hi, everyone, and welcome to the Q&A session. If you have any questions, please post them in the chat. We are still on a journey to make Techstep profitable. We have the fourth consecutive quarter of a positive EBITDA adjusted. Our net gross profit margin is up 29%-33%, and our ARR on own software is up 12% year-on-year. We focus heavily on the cost side and see a decent decline. We also see positive cash flow from operations with a cash position of NOK 68 million end of quarter, giving us financial flexibility. Let us see what questions that have come in.
Okay, David, there's a question for you. You mentioned that it has taken time to materialize the two large contracts, and that we can't see much effect in the second half of 2023. Does that mean that one quarter of these two-year agreements are lost, or is scope still the same, but very back-end loaded?
Yes. First of all, the contracts are not two years, but one... two years, and then 1 + 1. Our ambition or the delay we see, it will not impact the income from those big frame agreements that we have won, but they are rather delayed. We see potential gains in the contracts moving forward, and I'm quite positive that they will generate the income that we need.
Good. See if there's more questions.
Yes. Here's one for you, Ellen. Can you comment on why hardware as a service is so weak? I thought this was one of our focus areas for generating recurring revenues.
Okay, yeah. Hardware as a service is, of course, you know, the revenue is correlating with the movement in transactional hardware. So when we see a decline in transactional hardware, the hardware as a service also naturally decline. But that being said, the decline in hardware as a service is not as large as the transactional hardware, and the as a service concept is something we are focusing on going forward. We believe that is something our customers would like, so that will be something we will be working hard with going forward to bring into the market even more.
For sure.
For you, David, are your 2025 goals realistic when you now reduce your 2023 goal for the second time?
I still think that the 2025 goals are realistic. As we said, the bigger contracts and the bigger frame agreements we have won, we can see that they will materialize in the way we have expected, a bit later, though. We also aim for new contracts, of course, and I think that is also something that is looking good. We have a positive flow when it comes to what we have done with our portfolio and our offering to the market.
Mm.
The 2025 goal is staying.
Yeah. Good. Another one for you, David. What will you do to manage the cost side?
Yes, we've done a lot during the past two years, I would say, to manage the cost side, and we are in a fairly good position right now, but there are more to do.
Mm.
I think what we are gonna work heavily on moving forward is to streamline our processes and our organization even more. I can also see some benefits from cross-market pollination when it comes to our bigger markets. I think we can do more there to be more effective. So that's gonna be a big focus moving forward, of course.
Yep.
So, Ellen, one for you: Will you need to raise more capital?
No. There's no reason why we should do that at the moment. Our financial position is solid. We are generating cash. Going forward, we have reduced our costs substantially. We have a fairly good cash balance at the end of the quarter, and I can't see that there's necessary to do anything going forward. Okay.
All right. I think that was all the questions we had for today.
Yeah.
Thank you all for attending.