Ladies and gentlemen, welcome to Lindab International AB afternoon meeting. My name is Anna, and I will be your coordinator for today's conference. For the duration of the call, you will be on listening only. However, at the end of this presentation, you will have opportunity to ask questions. If anytime you need assistance, please press star 0 on your telephone keypad and you will be connected to one operator. I will now hand you over to CEO Peter Nilsson to begin today's conference. Thank you.
Thank you, Anna. Welcome to this press information. My name is Peter Nilsson, as you heard, and I'm the chairman of Lindab. Today, here in Grevie, Sweden, I sit together with the new interim CEO, Fredrik von Oelreich, and we will hear more about Fredrik in a little while. Firstly, I would like to apologize to some of you, because I know that some of you have been trying to call me as my number was in the press release, and I've been busy and not answering the phone this today. I hope I can compensate for some of that during today's press information.
As Lindab just entered into a silent period in light of the release of the Q3 report that comes out on the 26th of October, we will have to be fairly short and concise in today's press information. Therefore, this morning, we actually went out with that we accelerated strategy and introduced a new interim CEO to Lindab. We have been doing a strategic review of the different business areas of Lindab, and we have concluded in the board that we will accelerate the strategy of clearer focus on the ventilation business. We will also explore structural alternatives to the building systems and other related businesses within the Lindab Group. Further, we actually decided that this work of acceleration will be supported by the introduction of a new CEO. Lindab actually enters a new phase in executing on the strategy.
Therefore, we have reached an agreement with the previous CEO, Mr. Anders Berg, and he will leave the company, he has left the company, and we have today introduced a new interim CEO, Mr. Fredrik von Oelreich. I want to stress to all of you that Lindab is very well positioned when the, for this work of now entering into the next phase and accelerate the speed of exploring the alternatives for our different businesses. The company is in good order, and there is absolutely no irregularities that have come to the, you know, notice of the board. There is nothing of that behind the press information.
This is actually about what I was planning to tell you today, and more than this, I would like to have through questions, if any, and then we will, to the best of our ability, in light of the silent period, try to answer. Should I hand over to you now, Anna?
Absolutely. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Please note there may be a short delay today whilst I'm taking participants' name. Please, if you could open your phone line locally, so I may take your name for your question. We do have a couple of questions coming through straight away. I will just take the names, I will then start to introduce them. Thank you. The first question comes from Johan Dahl, from SEB. Please, the headline is now open.
Hello there. Just a question on perhaps a bit of clarification in the press release. It was mentioned that the future for building systems and other parts of the group. Could you be a bit more specific in that sense, exactly what sort of activities we're referring to there, and how, you know, from a structural point of view, you see maybe differences between the various areas in the group? Thanks.
Johan, thank you for the question. let's see if I can... We, well, I want to we mean what we write in the press release, that's first, and we will be able to explore, much more, in much more detail when we release the Q3 report on the 26th. Basically, as we have communicated in the last, I think, 3 or 4, quarterly reports, we have a, if I may say, we have a very clear development of what you could describe as the ventilation business, which is, a market arena. That's fairly quickly actually involves into climate and energy systems as opposed to simple, if I may say, simple air distribution.
Another way of describing that side of the business is that we are rapidly moving into more and more integrated system solutions instead of traditional product installations. We have in Lindab, for instance, in building systems, we are building, steel erected, single story buildings, multi-story buildings. Without actually going into any detail around it's a, it's a business that is very different. Therefore, it's also a separate segment in our reporting. We go to market in a very different way there. We meet different customers, et cetera. We have other businesses that are either more closely related to our ventilation business or they are more closely related to our building systems business. That is what we mean here, that we will explore the different alternatives for these businesses.
How do we actually organize ourselves to be competitive and proactive for the demands of the future?
I interpret that as you're sort of taking a close look at all the building materials related products in the group. Is that totally incorrect or?
As we rise, we have done a strategic review of the different product areas within Lindab. Your way of describing it is I could actually align myself with that, even though I wouldn't have used exactly those words.
Okay. Just finally, if you just look on the ventilation business as such, what is the sort of primary opportunity you want to accelerate and grasp in that particular business? What do you sort of believe that there's room for improvement in the group?
That now we're entering into, let us come back when we have come out of the silent period of talking further on that. That's one that I ask for your patience until the 26th and the period thereafter.
Okay, thanks.
The next question comes from Max Friberg from Danske Bank. Please go ahead, your line is now open.
Yes, thank you. Johan took most of the relevant questions. I'm just trying to understand what sort of differentiates the new strategy from the one already taken in the past, 4 years from area. Within ventilation, you have the [audio distortion] , the measurement and also technologies. I thought that was strategy, ongoing strategy that sort of get a deep presence within the ventilation and indoor climate solutions business.
Yeah, Max, you're probably absolutely right. If we don't try, and I don't say we have changed strategy. What I tried to explain and what we tried to describe here is that we're entering a phase of execution and acceleration of executing on this strategy. Max, you're right in the sense, we, there is nothing saying for the ventilation business that we are changing any of the things you mentioned.
Yeah. Okay, that's clear. Just finally, maybe, I didn't quite catch the last answer on the building systems initiative, but just give us a hint in what kind of way you would evaluate different structural measures. I mean, what kind of takers would it be out there, or would it be a sort of spin off from the group or what? Just some kind of guidance.
I would be nice to get a hint in the silent period. No, we, I mean, we mean explore structural alternatives, is we are open-minded, but we haven't taken any decisions as of yet for any of the business areas. Structural alternatives means basically the complete map of alternatives that ensures that the business is managed in the best way for that business.
Okay. Just finally, when you say, I understand that we want to sort of look through the different product cycles and different underlying conditions here to see where you, where it's best for Lindab in the future. Should we also interpret this as we're gonna sort of accelerate an M&A growth here with the ventilation or this is more of a strategic overview of the group as a whole?
We mentioned specifically that we will focus on ventilation, with a clear focus on ventilation, and we will explore structural alternatives for building system and related businesses. That is what we say at this stage. Acceleration means that we, yes, we have a strategic roadmap for the different businesses within Lindab, and we will accelerate the execution of that roadmap. More, I will not disclose now.
Okay, fair enough. Looking forward to talk to you later on. Thanks.
Thank you.
Before we let the next person have the question, if you would like to ask a question, please press star one on your telephone keypad. Well, please, Jan, if you can also introduce which company you're calling from, I will appreciate it. Thank you. Your line is now open.
Thank you. Jan Hjelmer with Handelsbanken. Can you hear me?
Yes, we hear you well.
Okay. I was stuck with operator for a while, so I might have missed some of the answers already, so apologies if I ask the same questions. The first one is on the structure of the business right now. Before, well, until 2013, you reported ventilation business area, building components business area, building systems business area, and then the building components business area was included in the ventilation business, and it was called Product and Solutions. My question is, how much connection is it between the ventilation business and the building components business today? Are they very much intertwined, or will it be fairly easy to split these two up when you decide to, you know, focus on the ventilation business?
You probably, you talk about the history that was before my time, and you're probably more versatile than I am in that, actually. I can tell you as much, and I can tell everyone here that, I mean, if we look at the product pamphlet or portfolio for the total Lindab area, we have offerings that are at the end of the, of the scale, on both ends of the scale, totally unrelated to each other. There, when we have done this strategic review for the different product areas, we can see that they share different competitive pressures and different market outlooks, and they don't necessarily create any synergistic effect for us. That's what we can see.
And that's why we say that we want to accelerate the strategy of a clearer focus on the ventilation business. That's why we say we will explore structural alternatives for building systems and its related businesses. That is, that's where we are today, yeah? Another very important aspect of what we communicate today is that we want to accelerate the execution of that. We have, another way of describing that is we have a very clear roadmap, I think you heard that part, for the different businesses, now we want to execute on that. When we have decided on what to do exactly, we will inform the market.
My question is, as until the first half of this year, how was the business operated? Even if you report products and solutions as one business area, perhaps underneath there were different business streams, and ventilation business might have been managed separately versus the building components area, and maybe had key metrics for these two units separately, or were they included in one? It's, if that's the case, then it might be more difficult to break it up.
I mean, no, but that's a question it virtually impossible to it depends really how you... I mean, at the lowest sales level, of course, you have different sales targets, different sales materials for different product groups. That's, that I would say, or even that's the first meaningful dimension. When we aggregate that, and when we take planning cycles and strategic cycles, we are, we have been operating according to the segments that we are reporting the business in. Up until now, and until further notice, we drive the business along the lines of the primary and the secondary segments, definitely. The, on the lowest level, of course, we steer this with a much higher level of granularity.
I mean, another way of describing that, we have depots in many countries. Not all our product groups go through the depots, for instance, because we have different customer segments. Depending on where we are and what we try to analyze and what we want to create accelerated execution on, we of course, slice and dice the organization in different ways.
Okay. Just try to use another example. If you then to look at your Rainline business and your ventilation ducts business, for example, which are probably a bit different, are those, could that type of business be operated by the same manager, or are those separated in your organization as it goes today?
Yeah, they, when we talk like that, you provoke an example, we can, I'm not saying we do, but we can have different strategies for the two different areas. How we run that is not necessarily driven purely out of strategy, it can also be how the local competitive arena looks like and how our customer needs that. Because in some markets, installing ventilation ducts and installing Rainline products is done by the same, well, craftsman, hantverkare in Swedish. In some other markets, it's for one goes to a different kind of craftsman, and perhaps the ducts goes into an integrated solution, which is done by a more of a, almost an electrician instead. It differs.
Okay, all right, that's all for me. Looking forward to more info later on.
Thank you, Jan.
Before we let the next person, ask a question, ladies and gentlemen, if you would like to ask a question, please press star 1 on your telephone keypad. The next question comes from Mats Liss from Kepler. Please go ahead, the line is now open.
Yeah. Hi, thank you. Just a couple of follow-ups, I guess. First, regarding the strategic plan, just to get a feel for the timeline, it seems that you're planning to implement most of the measures in order, so should we expect something more around, well, in next year, or is it further out?
Good try. I will not comment on that today. We, I mean, give us the leeway now. We are saying that we will have a clearer focus, we are moving into execution, and we will accelerate it to the best of our ability. Many things have to fall in place for us to be able to deliver on some of the things we want to deliver, and we will have to come back on that one.
Yeah, then maybe a bit follow-up on that. Do you expect to solve these issues internally, or do you have external participants, which could be sort of? You will do this in joint ventures, et cetera, or how should we see it?
I think you should, I mean, which I tried to say we will explore structural alternatives, that is a fairly open statement in that sense. we are open-minded, but we haven't taken any decisions yet. I personally, I have a couple of hallmarks in how I want to see. It should be competitively, very sustainable. I think, I'm indeed with the board we have today in Lindab and the management, we are open-minded, and we will ensure that we do the best for Lindab and its product and its shareholders in that sense.
Okay. Just a final one, when do you expect to present a new CEO?
As quickly as I can. I've worked before with Mr. Fredrik von Oelreich. He has been accepting to take this on an interim basis. We have started a search. As soon as we have something, we will announce that as quickly as we can.
Okay. Thank you.
Bye.
Ladies and gentlemen, if you would like to ask a question, please press star 1 on your telephone keypad. We have another question from Jan Hjelmer from Handelsbanken. Please go ahead, line is now open.
Thank you, just to follow up, I wonder what triggered this decision. Is it that you find that the current structure of the group is negative for the operational performance? That is, that the ventilation business should have better growth and margins on its own, or was this decision driven more from a valuation perspective, that you expect a better valuation for Lindab as a whole, divided into smaller pieces? I hope that question was understandable.
Very much understandable, I choose at this point not to answer it. There you go. We have taken every aspect into consideration in deciding on this strategic direction for the company, of course.
Okay, thank you.
Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. There is no questions coming through, so I will hand the call back to you again. Thank you.
All on the line, thank you very much. Thank you for the questions. I hope that we satisfied, some of them with good answers, and I, wish all of you a very good afternoon. Thank you very much.
Thank you for joining today's conference. You may now replace your handsets to end this call. Thank you.