Earnings Call: Q4 2023

Feb 15, 2024

Welcome to this Q4 report presentation by Carium, a technology enabled care company. The presentation will be followed by a Q and A and the viewers are Thank you, Matthias. Thank you. And happy to have you in the studio. Your CFO, Matthias Karlsson, will be joining us in Q and A in our virtual studio as well. So before you start your presentation, how would you describe the Q4 in brief? So the Q4 in brief is a combination I'd argue between highs and lows. As the people who have read the report, you can see that we have a very modest growth for which there are very good explanations and reasons that I will cover in the report. However, we are of course not very happy with that outcome. On the flip side, we are delivering very, very well on profitability and namely the free cash flows, which I think has been a concern for a lot of our shareholders out there. I'm very, very pleased that while we flagged clearly around Q3 that we were going to work diligently on this, we have actually succeeded and delivered well. I'm very proud of those two highlights. I can believe that. So by that, please go ahead with your presentation and I will be back with the Q and A. Please go ahead. Thank you. All right. So again, a warm welcome to the Carium Q4 2023 and also full year since we are concluding the entirety of 2023. As stated, I'm Christian Waller, CEO and President of Carium and I'm joined by Matthias Karlsson, my colleague and CFO. So starting out, we'd like to raise some highlights. As mentioned here, we have a very solid profitability and as communicated, we have also delivered well on cash flows. Now I want to really highlight the importance of this because since a lot of our production happens in Asia and we now face the Chinese New Year where in effect collaboration and I'm really happy that we've delivered on that. In addition, I think the strong growth in what we named the other markets, which is DACH, mainly Germany and France is really positive. This is also reflective of our efforts in really focusing resources and time on these markets due to their immense potential going forward. In addition, we have also closed the year and I think looking back on 2023 is a very solid year. It's reflective of a lot of effort from our entire teams face the future that we wanted to be. So with the highlights out of the way, let's move to sales and gross margin for Q4, 2023. So in Q4, we had organic sales of 1.7% above Q4 in 2022. Now adjusted for currency effect, this amounted merely to 0.4%. In absolute terms, it was sales of SEK196,400,000 compared to last no, sorry, SEK199,400,000 compared to last year's Q4 of SEK 190 6.2%. So the modest growth was explained mainly by issues in the U. K. That I will cover as we talk through the U. K. Market. So service sales amounted to $154,100,000 up from $145,100,000 same period last year, an increase of 6.2%. For product sales, we delivered 45,300,000 compared to 51 point 3% in the Q3 Q4 of 2022. Now this is a decrease of 11.3% and it's more or less completely attributable to the developments in the U. K. Our gross margin for the Q4 of 2023 was 40.2 compared to the same period last year, it's set at 39.4%. This improvement was driven by efficient work across our alarm receiving centers and also in part by the mix of products sold. So with that, we head to our markets. And starting out with the Nordics, our business in the Nordics, so sales rise 0.5% compared to the Q4 of last year with service sales growing 13.2% compared to the same period last year. Now this was driven both by new contract wins and some temporary prolongations of current contracts. The slight decrease in gross margin for the Nordics was mainly explained by sick leave in the and the associated costs in our alarm receiving centers in Norway and Sweden. Now moving to the U. K, we saw total sales decrease by 9.9% compared to the same period last year. Now service sales decreased about 3.6%, whereas the product sales decreased a whopping 18.9%. And while the decrease in service sales was explained mainly by exiting of contracts, The more severe decrease in product sales is mainly attributable to 2 factors. The first is that we had some technical issues concerning new pieces of equipment. The issue was around the startup time. The alarms that we create are essentially technical hubs to connect a lot of sensors in the homes of the user. And what happened was that due to some firmware updates, we actually had a very, very long startup time when the equipment is installed. So while that normally is a very fast process taking a couple of minutes, we were now up in the hours. And what happened was of course in the UK to drive efficient installations. And in the U. K. With a high focus on innovation and interconnectedness, this led to a lot of customers for that period when we had the issues which range from middle of October up until the mid of December, they chose to go with other providers. This doesn't mean that they left us in any way. They more or less said that, you know, we would like to be back together with you once you have fixed this. And we're seeing emerging evidence of that being the case already. So that's very positive. However, other customers in other markets were not as concerned. There was a different approach to it. The U. K. Is slightly different in that regard. It's a bit faster moving and thereby we saw the immense hit to product sales. But it wasn't only that, as we have highlighted many times, the U. K. Is in the process of closing down its analog infrastructure. And what that means is effectively that all the people who are dependent on our type of technology, the majority of those in the UK, they are not on digital solutions. And this led to the U. K. Government highlighting that committing to the plan, which was to essentially close the infrastructure come the last of December in 2024 would have put millions of people at risk all over the country and thereby without giving a clear time plan, the government has stated that it will prolong the period effectively putting a grace period in place to enable the local authorities and businesses to adapt to the new digital environment faster. And what that meant for us was that the urgency of driving replacements and so on, it mellowed somewhat. So we're on the industry board as industry representatives following this process, working with the government and working with Telcos. As of yet, there are no new information regarding new timeframes and so on. But we did see a strong effect of this in the Q4. Hopefully, will revert and we will get more information going forward. Gross margin for the UK was 38.2%, which is up from 35.2 in the same period of last year and this is driven by the ongoing work to effect device or UK operation. We then turn to the Netherlands, they delivered a sales decrease of 1.8% in the Q4 of 'twenty three compared to 'twenty two. Service sales decreased 2.4% due to a onetime effect in revenue recognition where we changed our principles a bit. The gross margin increased to 57% in the Q4 of 'twenty 3 compared to 'twenty 2 due to the efficiencies that we've developed in the customer contact center, which is a key part of our Netherlands operation. And as mentioned, other markets, which is predominantly Germany and France saw an increase of sales with a steady 19.4% compared to the same period last year, which is reflective of our efforts to focus on this really big opportunities out in the EU. Gross margin, it decreased a bit and that is due to the mix of the products and the margins that they entail. And with our markets out of the way, we had to profitability 31.7 in the same period of last year. EBITDA in the Q4 of 2023 was not affected by any restructuring or one off cost of non recurring nature, whereas in the same period of last year EBITDA was positively affected by SEK3.9 million. We delivered an EBIT of SEK 16,700,000 for the Q4 in 'twenty three. In the same period last year, it amounted to SEK13.2 million. However, as stated, EBITDA in Q4 in 'twenty three was not affected by any cost non recurring and so on. And last year, as mentioned, it was positively impacted by SEK 3,900,000. So like for like, the comparison is better. The main driver for the profitability is of course cost reductions and increased efficiencies that we are driving all over the business. And then moving on to cash flow, which is an area that many have raised questions around. So the cash flow from the current activities in the 4th of 2023 amounted to SEK53.8 million compared to minus SEK32.7 million during the same period in 2022. Free cash flows for Q4 in 'twenty three amounted to SEK 35,800,000 which is a major improvement versus the same period in the last year's same quarter where we saw a negative free cash flow of minus 53.4. Now this is reflective of the intense work on working with suppliers, planning orders and production in a much better way. Cash totaled SEK 31,500,000 at the end of the Q4 and 2023 compared to SEK 39,900,000 in the same period last year. The bank overdraft facility showed available cash of SEK 50,000,000 in the Q4 of 2023 compared to SEK 21 point SEK8 1,000,000 in the Q4 of 'twenty two. Net debt amounted to SEK194,300,000 at the end of Q4 of 2023 compared to 253,600,000 at the end of the same quarter in the previous year, I think that is a decrease of 23.4%. And with Q4 Marking the end of the fiscal year, let's take a minute or so and look at the summary and outlook towards 2020 4. So for the full year of 2023, Carium delivered total sales of 800 and 24,600,000 compared to 725,100,000 in 2022. Now this is reflective of a growth of 13.7%. EBIT increased to 59 point €4,000,000 for the full year of 2023 compared to minus €15,800,000 in 2022. Now this showcases the effects of all the measures and the actions that we have taken to effectively turn the business around during the year. We delivered total free cash flows of SEK61,900,000 in 2023 compared to a staggering minus SEK 87 point 4 during 2022. And this is all thanks to new processes, a dedicated supply chain function, new systems and so on. And looking ahead to 2024, in service of our shareholders, we are really pleased to now be offering a level of guidance in terms of our outlook and what we expect to attain. For the full year of 2024, we will deliver a growth of between 12% to 15% and by our efforts to diligently drive our efficient as effectively as possible, we will do so with increased profitability. Now the main drivers for 2024 will be as we have stated before, continued integration of our businesses all over Europe. And this will promote greater efficiency of course and also better collaboration and outcomes. We will work much closer with our customers with our centralized commercial office that we put in place during December, so fairly new to us, but already seeing great outcomes of how we're able to work with a much more coherent strategy to deliver on our growth. We will also see and I'm really excited about this, an expanded offering covering both hardware and software hitting the market throughout the year. So really positive about that. And in addition, Nothing has changed in regard to the infrastructure changes. While the time plan in the U. K. Might be prolonged, In the Nordics, for example, we have a close down on the 2 gs infrastructure, effectively meaning that you need to transition to 4 gs or even 5 gs. And this is something that is ongoing in both Sweden and Norway during the year of 2024, which we believe will have a positive effect on our business. So to conclude the year of 2023 and the Q4, I'd like to just shortly reiterate some concluding remarks. So we see the highlights in the solid EBIT and the free cash flows for the Q4 of the year. Strong development in our interesting high potential markets of France and Germany. We're closing the year with strong profitable growth as we look back on 2023 and conclude our turnaround as executed. The main challenge for the year is, of course, the sales in the U. K, predominantly related to products And the technical issues, they were solved in the period, but it's still extremely unfortunate in an area that we will work really hard to ensure that we not end up in again. The delay on the A2D as it's known, analog to digital is of course decreasing the urgency of our customers some extent, but let's wait and see to see where the new timeline takes us. And we expect that while we might not see the extreme peak that we anticipated, it will be a prolonged period of good sales going forward. So This will be our main focus, of course, ensuring that we are delivering as well as we can predominantly on the U. K. Sales. In addition, we are also super excited to actually have a level of guidance out to be able to tell the market that we truly believe we will do good and profitable business going forward in spite of actually retaining a lot of the investments needed to what we believe is sort of advancing the future of technology enabled care. And with that, we close our presentation and head over to any and all questions. Thank you so much, Christian. Very interesting to listen to your presentation. We will soon have an Equity Analyst joining us to ask his questions, but I will start off shooting one on myself. Besides the, of course, very important growth numbers that you already have explained. Almost anywhere else I look in the report, the numbers are increasing on the positive scale. Can you elaborate a bit on this? Well, thank you for noticing. We think so too. I mean, we are a very competitive business and team companies around within technology enabled care, striking a balance between the quality of what we do, the portfolio we have, the level of innovation and so on. So for us being forced to lean into growth outcomes like this, it is of course something that spurs us to do even better. But I agree for the year of 2023, we're coming from a really, really tough 2022 being able to deliver on the profitability, to deliver on the cash flows. We're extremely proud of that. And we don't, as we indicate, see any reason for why this should dissipate or change. We're going to be equally committed going forward to doing even better. So in one regard, I agree with you. We're very proud of some of the outcomes, but we are also furious about some of the others and going to work as hard as we can to remedy it. So I guess these numbers are not all in line with your expectations? I don't think anyone would be able to stand here and say an FX adjusted growth of 0.4% compared to the same quarter last year is something to be proud of. So I think all shareholders should know that this is really something that we're taking very seriously, much like we did with the cash flow during Q3, where we're also not happy. And we know that we were coming into a process of the Chinese New Year approaching, which is really challenging to plan around. So we'll be committing ourselves to doing our best here. Thank you. And by that, I'm handing over to us, Oskar Ronqvist, Equity analyst with ABG Sundal Collier. Please go ahead with your questions, Oskar. Thank you. Good morning, everyone. Thanks for taking the questions. First, I believe Just had a question on Christian, you said the modest growth, obviously, not very happy. Just wondered if you could sort of quantify anything on How many percentage points you think were, I mean, sort of due to the delay in the product sales? Are we talking about like Maybe 5% or something? Or how should we think about the future and then going into Q1, for instance? It's a good question. And I think it's quite hard to quantify. We certainly had an effect. I mean, I've been speaking to those customers myself, where they basically said that for the time being you have these issues, it will not be feasible for us to go out with our installation crews and partners, setting up the homes of people a process that should normally take maybe 40, 45 minutes. It is now up to 3 hours. It's just not serviceable for us. So we are forced to source equipment from someone else. We will be happy to be back once you've solved this. So that side of the decrease, hard to quantify, say half of it, I don't know. Whereas the delay in the transition out of analog infrastructure, that is much harder to say. And when those news broke, it was very much a kind of shocking moment for the entire industry Because everyone, both the customers and the suppliers had sort of anticipated that 2024 would be race towards basically digitizing the entirety of U. K. Technology enabled care. So Let's say fifty-fifty, but I think the prolonged effect of the delay in the transition. It is yet to be known. The government and the telcos have not come up with a time plan yet, Neither is there an implementation plan on how to do this transition guided by telcos and government. As mentioned, we are part the industry representative sitting in on those boards. And hopefully, we will be able to both influence the process, but also learn and understand it better. But for now, there has been no new clarity on how this process will be managed. The previous plan was effectively that come the last of December, the plug is pulled. And as I write in the report also to put this into sort of contextualizing it a bit, schemes, which is the name for a kind of living where you basically have seniors living in separate apartments in a larger facility. It's a very common way for seniors in the UK to live. There are around 25,000 of this. Now these are not nursing homes, so they are much more individual living. They're around 25,000 and the estimate is that as of today between 3,000 and 4,000 of those are fully digital and the rest would effectively not been able to uphold the functionality in sensors and alarms and so on should the plug have been pulled. So I can understand that the ramifications for seniors and vulnerable people in the U. K. Dependent on these technologies, it's not feasible to maybe be so swift as they've intended to be. Perfect. Thank you. Very helpful with the comments. And I assume that mean, the organic growth targets in 12% to 15% in 2024 is pretty much evidence of you expecting a recovery pretty much soon as well. But just on the targets, you expect EBIT to grow. You don't quantify that in any sort of bit. So just wondered if you could expand anything on sort of what your plans are regarding the operating leverage into 2024? Just I mean, reminding any sort of comments on potential OpEx growth that would be helpful in terms of No, that's a very good question. I think as I've stated many times, I think we with our history of being a series of companies integrated to varying degree, let's say, this is still a major opportunity for us to become smarter together and more efficient. So we're going to keep driving that journey. We are nowhere near done where we feel that we are happy with it. So that will be a key focus and thus we think that there is an opportunity for us to do better in regards to profitability. So we don't foresee any major OpEx increases, anything like that. If anything, we'd go the other way hopefully and become more lean, mean and efficient. Matthias, do you want to comment something on this? Yeah. Yeah. I could say that in the plans for the coming year, it will be both roundabouts and carousels or what do we say no swings and carousels, you say. And because we, of course, need to do some investments in organization and so on to actually retrieve the efficiency that is needed and the integration and so on. So some things will, of course, come with a cost, but it will, in the end, be a more integrated and efficient organization of it. And if I may comment also, Oskar, because I think it's a good question. For me, This space that we are in where we are one of the few companies in Europe who have the You have the leading jersey or something like that. We are one of those companies. And we have so many exciting things in regards to what we want to take to the market. And that, of course, is something that we want to accelerate across certain areas. But as we guide, we do believe that we will be able to do this in a more profitable manner than we have done in 2023. The extent to that, let's say, we'll do as well as we can, but the aim is firmly set on being better. Perfect. That's very helpful as well. And Maybe a question for Matthias, just a little bit on the working capital and obviously quite sort of a cash flow relief in the quarter. Just two questions on that. So first of all, just the Chinese New Year. Obviously, you had an inventory release. If we should expect any sort of inventory buildup maybe in Q1 again or sort of in the 1st part of 2024. And also just on the financial assets are growing quite rapidly over the last few years, I believe it relates to your lease agreements where you have sort of long term receivables outstanding. So I Knowledge that there is a lag effect on the cash flow in these types of contracts, but if you could just expand maybe a little bit on how we should think about the sort of net cash flow impact going forward, assume that some of the previous contract will support cash flow ahead, even though it might increase as sort of an absolute number. So the question would be, are you seeing this item to stabilize as a percentage of sales going forward or should it increase? Thanks. Yeah. When it comes to inventories and the effect of the Chinese New Year, you could say that The build up of inventory is mostly in the beginning of the Q1, I would say, because we, of course, have had to fill up our warehouses before the end of Jan to be able to deliver to our customers. So I would not anticipate that there will be a major build up, if you compare end of December with end of March, if you say so, because the things that we have built up now should be out of the warehouse also. However, it will of course, Since it's such a big build up of inventory, it also creates, of course, a lot of accounts payable or supplier invoices that needs to be paid. So yes, it's difficult to say exactly what the cash flow will be in for the Q1. But The periodicity of how we build up the inventory could have a slight negative effect on cash flow in Q1, I would say, but let's see how we can manage that. When it comes To our rental agreements and these things, we have in the plan that we will sell or deliver a lot of equipment especially due to both for the analog to digital in UK and so on, but also a lot of equipment where we shift 2 gs products to 4 gs products in the Nordics and so on. So it will have an effect on the cash flow. We will have a cash flow tie up in financial lease or rental agreements during the year. Yes. Perfect. That's very helpful. I just had a final question. It's on the gross margin. So I know that you work very hard on the efficiencies here as well. The gross margin came in at around 40 percent in the quarter. It's slightly below Q3, but I believe Q3 was maybe a bit boosted by the sort of contract extensions, right? And Then also in Q2, I think you have had a little bit of a higher margin. It was had higher sick leave in this quarter. But any sort of Comments on what we can expect as a sort of normalized gross margin. Do you think that it was sort of particularly weak this quarter? Or is it sort of normalized at the moment at 40? Yeah. I think that around 40 It is in the normal range. It can, of course, go a bit up and down depending on where we sell products, which products we sell and the mix between products and services in a specific quarter, because the pricing of products is not exactly the same in all markets and so on. So if we are stronger in one market and weaker in another in a specific quarter, for example, you could have an impact on the exact gross margin in that quarter. And if I may sorry, Matthias. And if I may add also, I think this is also one of the reasons not just due to the management of cash and working with our suppliers, but also the active work across our product portfolio Because here is a huge opportunity for us to cost down on the equipment that we manufacture by changing designs, changing components, smarter and so on. And that also plays into this. And it's a little bit of an X factor here in regard to having these large volumes of rental contracts that might obviously have an impact on the cash flow. Got it. Very helpful. Just I had a final question on more sort of the long term outlook as well. I thought that the so called other segment, right, DACHEN and France, right? So it was very strong in Q3. I thought it was some sort of a one off effect that it was going to be as strong going forward, but it came in at the $30,000,000, right? So it was evidently stronger than we expected. So can you just talk a little bit about, I mean, the growth opportunities you see in this market as well? Well, I mean, we're very happy to see our efforts in focusing on these markets delivering. And I mean, to some extent, it's not as easy as to say that our game is a demographics game, But to some extent it is. And there are around 89,000,000 people in Germany and there are around 67,000,000 people in France. So clearly these markets deserve and need a lot more attention. Now the business models and the market context might be slightly different. So our German operation for example is very centered on B2B, predominantly focused on hardware and software and the same goes for France. So it's a slightly different approach to how we provide our services and create our partnerships visavis something like Sweden where you would be integrating hardware and services and alarm receiving centers and so on into the delivery for the public customer, whereas in this market it's a completely different ballgame. It's much more B2B centric. So what we've done and what we're seeing the effects of is of course that we are investing to lean into that reality and do really well Because in both of these markets, we are regarded as a really quality innovative partner across both hardware and software. So while we don't make any claims in terms of what level of growth we should expect for these markets, they are of course important drivers for us going forward. But very important part of our future business, it lies in these markets. And also Spain that we think is something that we're working towards, but we have a presence, but we think more things can happen there. All right. Thank you very much for taking the questions. Very helpful. Thank you so much, Oskar. Good questions. And if I start off following up, with the free cash flow that you improved that much, you described a bit in the presentation, you manage your processes better and so on. Could you elaborate a bit on this? Well, I mean, we as Matthias alluded to, we tie up a lot of capital in equipment, of course. So the smarter we are around how we work with equipment and our suppliers, it could be everything from the terms to the cost down of the products and so on. So it's actually a world of work going into that. And one of the changes we did during the year was to separate out Organizationally, we house supply chain and IT under the same roof, so to speak. And what we've done is that we have set up a dedicated supply chain function And we have also recruited a new CIO office to manage both of those things with full dedication and we're seeing some of the effects this and also of course great work with Matthias and his team on the finance side. So it's really a team effort in being smarter and better and more focused on these topics and issues. Thank you. And how will the geopolitical crisis affect your supply chain? It's a good question. And we conclude that of course we're interested in shipping as much as we can on the on water on boats, which as we all know, we now have a 10 day delay due to the situation in the with the Houthi rebels and the attacks. However, momentarily and this is more or less just coincidence with the Chinese New Year, there are not that many deliveries done. So depending on how the situation develops, Hopefully, it will resolve itself. We might see extended shipping delays and also some increases in costs. It's pretty much a spot market as it stands. What we have done is that we have increased our air freight a little bit, which of course increases the cost to some extent. But for now, as we stand here on the 15th February, we do not see it as very troubling at the moment, but who knows how it develops. Thank you. I have a very detailed question from a viewer here, I guess addressing Matthias. How large is your IFRS 16 leasing debt? I definitely think that's a question for Matthias. I think so, Well, it's I don't have the exact number, but it's around SEK 45,000,000. Another question from a viewer regarding your product. Can you give some more details on the expanded hardware and software offering you mentioned in the presentation? Good. So as the astute viewer or reader and follower of Carrier would know, we launched at the end of during the 4th We launched the Abbey properly and the Abbey is a mobile social alarm, which means it's something that you take with you. And this little piece of equipment is actually quite fantastic because it allows us to do everything from geo fencing individuals with dementia, so we can know where they are, if they are moving out of sort of the safe zones to protect them. It features some basic health data that we can feedback to understand if something is changing around the individual. It is also something that makes great use of our Eye Care Plus app, which involves sort of the full circle of care with relatives and so on to have much better connection and understanding of what goes on with the individual. So that I think is a good example. And as we have flagged previously, it was a little bit delayed out of production, but we're now happy to see it in the market and it is doing really well. We are getting some great feedback on this probably being one of the best products in the category in all of Europe And we're not done there. We still see some gaps in our portfolio that we hope to fill during the years. Some Connecting to the private pay market in which we are a player in those markets where it's very valuable to be so and that we think might be very suitable. But I would hold it off a little bit in terms of what it is and you will have to follow the PMs and the reports. Then we, of course, will do so. Another question from a viewer, I think addressing Matthias again. The gross margin was down in Q4 compared to at the same time, OpEx decreased. Can you give some more color to this? Yes. When it comes to gross margin, it was a really strong gross margin in Q3. And as we stated then, we had a lot of prolonged or a lot, but a few prolonged contracts with higher than normal prices as that is what happens when some a customer wants to prolong something. And when they are going out, we also, of course, have the possibility to take out some costs. So a bit less gross margin in Q4, but also a little bit lower cost led. Thank you so much. And Christian, If we move over to the markets again, how would you describe the situation among the countries that you're active in and others also in the Mediterranean area when it comes to analog to digital A to D that you call it. How would you describe the situation? Well, I think it's quite interesting to see that the infrastructure in different countries are just so vastly different. So you could go to these web pages which states when will so and so part of the infrastructure close and you will see that the same infrastructure that will close in 2024 in Sweden, it is expected to the French population up until 2,030. So it's a completely different set of context, which are reflective of course of the investments made from these markets and countries and so on. So it's really it's a case by case basis. What I would say though is that based on our strategic analysis, We are in the markets where 85% of European spend into technology enabled care is. So we are probably maybe not looking to these countries, the Czech Republic or Italy and so on because we have sort of assessed that The spend isn't so big. The cultural context around how you service seniors might be different and so on. So we're probably going to stay and work with the known time plans that we have in the markets we are in. Now that said, we were surprised by the UK government's decision to prolong the period. We've had them basically breathing down our necks and our customers' necks for a long time saying you now need to get ready, you really need to completely shift this landscape. And then all of a sudden the goal is sort of being moved. But let's see how that turns out. Yes, I'll come back to that. But First off, does this mean the different matureness in various countries that you can improve and reuse your strategies? Well, I think that's very interesting for me personally and for the entirety of the management team. I think something that we really enjoy is the fact that All these systems of care if you will, they are very different. I mean in Sweden we all know that we have the home care, people coming home to people, helping people out with various tasks from shopping to showering and so on. That does not exist in the U. K. It's either your relatives helping you or you're on an ambulance. There's nothing in between. And that is where we find someone like us who do the mobile response go out to people, take full responsibility for that and also manage the alarms and so on. So we are forced to basically work on and a glocal model if you will. So we have an overarching strategy for our business, but we also have very clearly defined local strategies. And our task is, of course, to create as much scale effects on the investments we do as possible. But to some extent, it's also down to where we are, who we are in a certain markets and how we should attack it. And if we continue among the risks around Carrier and New York Services, Besides the obvious with regulations and changes in politics and so on, what other risks are there? Well, I think as we experienced in 2023, we were the subject in our Swedish operation of a really malicious cyber attack. We resolved it in 18 hours, and as we can read in the news and so on, I would argue that this is one of the risks that we are really, really adamant about doing our best to to circumvent, which is hard next to impossible, but it's something that is extremely high on our list. Regulation, as you mentioned, is of course another one. Changes in payment systems are usually in the public markets driven by political decisions and so on. But those will probably be some of our top ones aside from your traditional operational risks and so on that you would have in the supply chain risks as we talked about. And if we move back to growth, you're aiming to 12% to 15%. How confident are you to reach those numbers? Absolutely. I mean, we are and I really want to underline also, this is what we see as organic growth. Now I might be forced to hit my hat here due to political changes and whatnot, but should the situation be reasonably stable, we are convinced that we will be able to grow and do so in an even more profitable manner with retained investments because our market is good, our position in the market is really good. And the image of Carium in the eyes of our customers, that is also a very, very strong position. And what are your main milestones for 2024? So 4, aside from the financial commitments and expectations on delivery of course, I think the main thing for us will be to continue being successful in these high potential markets. We would love to break into Spain. That would be fantastic in a more far reaching manner. Huge market, very, very advanced in terms of technology enabled care. U. K. Is probably most innovative, but Spain is also very, very strong market. And as we flagged Some aspects of the hardware portfolio, we're looking forward to expanding, but also on the software side. Because if able to deliver better on services related to software for our customers and for ourselves. We truly believe that that is something that changes the landscape a bit. And hardware as fantastic as it is and as necessary as it is, it is not there is a limit to how much you can do and the time it takes to do so compared to the software side. So we want to see stronger functionality in our apps and hopefully some really interesting developments on how everything from our IoT back ends can create ecosystems with other products, how our device management systems can be improved for ourselves and for our customers and maybe something else in relation to software. Okay. Thank you, Christian. That was all my questions for today. So thank you so much, Christian and Matthias for presenting and giving answers. Thank you, Matthias. Pleasure to be here.