Welcome, ladies and gentlemen, to the 2025 edition of the MilDef Capital Markets Day. A warm welcome to the many good friends, owners, analysts, and media in this very room. Many of you were here last year, so we're excited to see you back again. Welcome to the many of you following the MilDef Capital Markets Day 2025 on the online live broadcast, on the webcast on our webpage or on YouTube. You're also very, very welcome. It's the first time we do this live on an online feed broadcast, so it's a little bit of an excitement for us. Thank you for participating. This is a unique opportunity to dive deeper into the MilDef universe. Traditionally, as you know, when we meet, we have 30 minutes, 40 minutes, quarterly reports, one-on-ones, roadshows, investor meetings, seminars.
It's always too little time, and we're always rushing through it, Daniel, myself, and the rest of the team. Today, all in all, we have four hours together in this room. The participants and the travelers on the spaceship today here with the lunch, we have four hours to deep dive into this universe. For those online, it's three hours. By the way, my name is Olof Engvall. I'm the Head of Investor Relations and Corporate Communication with MilDef going four years back. It is my duty to tell you, ladies and gentlemen, that the emergency exit is in the very back of the room. Please make sure you know where it is. That's the closest one. You can also make life more complicated by going out there. If you want to take that one, you can follow the signs for the emergency if the unlikely happens, of course.
This is the second streak of our Capital Markets Day, and we have four hours together. The presenters of this show have, of course, spent a lot of time to make this a very valuable agenda. It is a full flight, no doubt. This fast-growing Swedish tech defense company has packed a bag which is overloaded, probably, but it's lots of value. I can already now reveal that there are no news items which you've seen in the press release one hour ago, but there will be many new learnings from this event when we deep dive into the many topics that we have packed in this suitcase today. By no doubt, it's a very full briefcase, and we will talk about topics that you typically ask us about. How do we put content into a day like this? We listen to you.
The many questions we get from you when we meet you out there, very, very, very often. We will talk about the MilDef journey, going a little bit back and going into the future. We will deep dive into the tech, to the solutions, to the hardware, to the software, to the integration services, the new broader MilDef that has evolved over the soon 30 years of existence. We will talk about how we sell and to whom, of course, that's very important as we go deeper into Central Europe and we go down on the DACH market, for instance. We will deep dive into the somewhat difficult to understand sometimes, but the fantastic deployment software, OneSys, which we sometimes try to explain in 30 seconds to you. Today, we have 20 minutes with the actual inventor and the tech guy behind it all.
Daniel will, of course, talk about the pathway to the future and the strategies going forward on this somewhat overwhelming journey that MilDef is on. Remember, we are going to be twice the size this year than last time we did this Capital Markets Day on TopLine. It's a bit of a journey. I said that there are no news in this deck this morning, but I was excited the other day. You all know that SEB took us to the Nasdaq Stock Exchange. Very good friends with SEB, of course, going back. This got me a bit excited the other day when SEB pointed to three European defense companies saying that Chemring, Rheinmetall, and MilDef, yours truly, are the hottest stocks on the defense platform on the stock exchange right now.
This, of course, and you've seen this, and since I'm an old journalist, I think this is very exciting. Thank you, SEB, for doing that. Let's see if we can live up to all these promises going forward. Like last year, we presented the full management team at this Capital Markets Day. That's one of the big values of this day, of course, that you will have a coffee break and you will have a lunch and you will have many interesting presentations by the corporate management team. Today, in a few seconds, I will ask them to rise up and introduce themselves. I will also say that we miss you, Viveca. Come back. Viveca is tracking us. Our CFO, Viveca Johnsson, she is on maternity leave and she will be back in January. Please come back in January. We certainly miss you.
Now I want the corporate management team and the extension today, the Norwegian gentlemen and the German gentlemen, to stand up and introduce yourself. I think that you have microphones, so you can do that. Please stand up and rise to the occasion so the audience knows who you are. Let's do it from Magnus and then we go to the other side with Daniel.
Good morning. Magnus Hagman, Vice President Nordics.
Good morning. Fabian Forster, Business Manager for our OneSys product.
Fredrik Persson, CTO and Deputy CEO at MilDef.
Frank Scholz, I'm the Managing Director at Roda Computer GmbH.
Karin Spallander, Chief Legal and Compliance Officer.
Martina Karlsson, Chief People Officer.
Finally, good morning everyone. Daniel Ljunggren, CEO MilDef.
Thank you, ladies and gentlemen. You will see much more of these, my colleagues, later on in the show. When planning this event, and we are at the starting point now, when planning this event, we were thinking about taking you all down to the fortress in Helsingborg. How many of you have been to the fortress? Quite a few. The fortress is the MilDef headquarters and main production facility in Helsingborg, where it all started some shy 30 years ago. We thought about bringing you down, but then it's easier to do it here in Stockholm. The other idea was to travel on a bus, a big bus trip together, 20 minutes up north towards Arlanda. In two weeks' time, we inaugurate 6,500 sq m of state-of-the-art production, installation, service facility. It's a Tony Stark workshop, really. It's amazing.
You will see in a few moments this building behind the scenes. We were thinking about bringing you there for the Capital Markets Day. However, we realized there are no furnitures. It would be funny to see you all sit on the floor. We didn't do that. Next CMD, perhaps. Talking about Daniel presenting this very momentarily, for 14 years, he has been along the journey of MilDef's growth path. When he started in 2011, MilDef turned over SEK 50 million. When we travel out of 2025 this year, MilDef will be well over 40 times bigger. It's been quite a journey, don't you say, Daniel? A warm hand for our CEO and President, Daniel Ljunggren.
Thank you very much, Olof, of course. Most welcome to all of you here physically in the room, the audience, and also all of you online there. As Olof mentioned, we have a full packed agenda today. We're trying to be as quick as possible, but get the message out there. Before I kick off, Olof mentioned the whole management team here. As you all know, running a company is more of a team sport. I'm really super happy to have the strong team here with me together today. We also, on top of that, have two really experts when it comes to what I see as two critical components for MilDef's further growth journey. That's the German market and also our more and more high demand for our software, the OneSys.
You will really try to understand and get the true experts to explain how they see those two kind of components going forward. I agree, Olof, we miss Viveca. Hello, Viveca. We'll see you in January again. We are a full management team besides Viveca then. Let's start then with the MilDef universe just to give you some overflight over the basic facts of MilDef. We will deep dive into this, of course, but we are a provider of tactical IT solution founded in 1997. As we say here, history matters. This is because it's much of a trust business to be in this business. We have decades of trust in defense. We have been in this area where maybe everything was just decreasing. Now that we see rampant increase in defense spending again, we are in the right position. History matters and our trust in this industry matters.
We are doing an IPO in June 2021. We are like more than four years into our journey as a public traded company. We are more than 45,000 shareholders today, which I think is quite much due to the fact that we are just a mid-cap company. Some of these shareholders I see in the room here today, of course, some of you are included in this 45,000. We are in the company today around 500 employees and we have presence in 10 countries. The other way to explain what we are in MilDef and give you that sentence and that context and give you that glance into MilDef is, of course, to say that we are a fast-growing defense tech company. We're looking at now the last 12 months order intake of SEK 2.5 billion. We're doubling the order intake the last 12 months.
We have an all-time high record strong order backlog, SEK 3.2 billion. That's a growth of 120% the last 12 months. We have a book-to-bill rate that is close to SEK 1.8 billion. There is still some power and some room for continued growth going forward. In the last 12 months, we did a net sales growth of 25%. We have increased, we're going to come back to that, the capacity question, but we are today 500 full-time employees. That's an increase of more than 50% in the last 12 months. This is actually where we have MilDef and where we find MilDef today, a fast-growing defense tech company. Just to give you a little bit more flavor on that, if we go back to 2021 and you see the progress in the order intake, we see a CAGR of 43%.
Year-over-year, we have added 43% in growth in order intake. Another KPI that is important for us is the order backlog. If we look at that development since 2021, we see a development that is more than 300%. That is where we can find MilDef right now. Of course, this is due to the European defense ramp-up. We will come back to that later, that we probably just now are at the beginning of the beginning, even if we can see this ramp-up in all of the KPIs. I also want to give you a breakdown over our net sales geographically and see where we have our strong footprint. We are based in the Nordic countries. Our home market is Sweden. That is where we have grown up and where we are still doing most of the business.
We have super good relationships with procurement agencies in Sweden, Denmark, and Norway. This is just when we have added like four months into the Roda Computer GmbH journey together with MilDef. We have a strong footprint in Europe. Going forward, we're seeing that the European number will go north of 50%. We will transform MilDef from being a quite strong key player in the Nordic markets to being a key player in the total European market. That will be a play together with Roda Computer GmbH doing that. We also have presence in North America. We have 10% of the net sales coming from North America. I also want to underscore what's actually the headline saying here. We have the geographic footprint that is needed.
The total defense spending in the areas where we already have a strong footprint, we will see the steepest defense spending in terms of percentage of GDP. We will see that the closer you have the border to Russia. That means that we have the really good relationships and the footprints that we need. We just need to dig where we stand a little bit and do even more in the markets and with the customers that we already have. I also want to take the opportunity to zoom out a little bit and talk about how we see the market and how we see the trends on the markets. You're all, of course, following this in the newspapers and the media, on TV and things like that. This is how we see it at least.
This is also trying to explain what we see as MilDef Group's long-term drivers of growth in Europe. First of all, number one is this rearming of Europe. You all have seen the new NATO target spending. You know what the decision was that was taken in Hagen, in that summit just before summer here. That will be a super good driver for long-term growth. Some people are talking about this defense tech cyber cycle that we now are entering into, where we see more of this data-driven defense system that will be the future and that will drive a need for what we at MilDef Group are doing. On top of that, we also have the European autonomy. We are seeing this weak transatlantic link. We know that the U.S. may be not backing up Europe anymore.
The political side has woken up in Europe and realized that we need to stand on our own legs. The buzzword here is Buy European. That will be a game changer for the European defense industry, which MilDef Group is a part of, of course. Also, the final, on top of that, if we're looking at the main drivers for MilDef Group, is the technology side. There will be a rising demand for digitalization, unmanned, and AI that will drive a need for what we are delivering, the right IT solution, the IT backbone. That will also be a big driver of growth going forward for MilDef Group. Number four here is around joint procurement. That is something we see on the market now. I think that could be a benefit for MilDef Group.
We see, especially in the Nordic context, where the countries now are coming together and trying to do coordinated requirements. Of course, they're aiming to ramp up and shorten the lead times and get higher volumes out there. I think if you have been a key player and a trusted supplier in this market for many years, you are in a really good position right now. If we also look at what they're trying to do in their term, they are buying what's already field-proven, what's already been working. MilDef Group has had products in Afghanistan, Mali, all over the world. The end customer knows that they will not fail. They will work. That is exactly what the end customer wants to have right now. Finally, number five, two long and tricky words: interchangeability and interoperability.
If we take the first one, it's about finding ad hoc standardization solutions where you can increase your resilience. You don't need to have the 110% perfect system solutions. Maybe you can have something that is 90% or something that you can replace with something else that's coming from something else. It is really important for them to make sure that in terms of building the capacity, you don't get vulnerable by not having other parts that you can take in and get the same capability. Also, the interoperability that we see now with the increased number of joint operations together in the NATO context. We also have the new members in NATO, Sweden and Finland, for example, really increasing the need, how they can come together and quickly start setting up their command and control and communication and things like that.
That is something that we will talk more about later on when we talk about the software and the OneSys. Of course, there are some key uncertainties, timing and size of the European ramp-up. We know that political decisions take time to materialize. We have seen this long cycle where everything will take a long time. That is something that we will see going forward as well. I don't have a better crystal ball than someone else. Maybe if we look further out in time, we don't really know how this will play out. The political decision is taken and now let's see how it will play out. The timing of things is quite tricky sometimes. We have tried to explain the timing of things.
For those of you who have been following MilDef Group for a while, you know that what we see, this is going back to February 2022, the Russian invasion of Ukraine. The end user and the end customer were focusing a lot on the operational effect. If you were an ammunition provider in Europe, you felt this day one. After a while, they started to, of course, fill up the backlog at the different platform providers. We were talking about Saab and BAE and those primes were really getting some big orders in there for delivering the big platforms. When MilDef Group comes into play, it means that we are quite late cycle in this defense ramp-up. We come into the picture when this kind of platform needs some kind of intelligence, when they need some tactical IT, they need their command and control system.
Then it's time to place the. order at MilDef. The $1 million question I normally get is, okay, where are we right now in this kind of phases as we see it? I would say somewhere here, maybe 2.5. We have seen some of the new money rippling down to MilDef. We have seen some of the new projects and programs and things like that that are starting to impact MilDef and increasing our order intake and our order backlog. I think the end of summer last year, we really felt that there was a change in the dynamic on the market where we started to see some of the money coming in from the new business. There is still a lot of ordered platforms that have not been ordered the tactical IT on. We're still waiting for a lot on that.
That's why I'm saying 2.5 maybe, but there will be a lot going forward in the end as well. We have priorities going forward. We have identified, of course, what we should aim and focus on, on our priorities going forward to be able to not just be relevant here today, but also be relevant in the future in this industry. We have boiled this down into four different areas. We have the scaling up. I think the whole defense industry is talking about this now, how to scale up in the best way. For MilDef, we're talking about climbing in the value chain. We're also talking about focus expansion, really making sure that we have a laser-sharp focus on what we should do right now and not get too mixed up with other things. Keep the focus we have. We have the resilience as well.
We will go through each of these in a little bit deep dive into that one. If we start with the scaling up part, this is what everyone is talking about in the defense industry. For MilDef, it's empowering the workforce. We need to retain, we need to attract, we need to onboarding, we need to train people, we need to increase our capacity and capabilities within the staff we have. We need to ramp up the facility capacity. We will just in a short second here show you a video and take you out to the reality, into the state-of-the-art building that Olof mentioned before. Location is Rosersberg. It's just outside Stockholm here. We're also increasing our facility capacity down in Helsingborg. We're doing it in ways in the U.K., in Cardiff, where we have a new office in Oslo, for example, in Norway.
We're doing whatever we can to make sure that we will be relevant now and also in the future. That is what we're going to do. How we're going to do it is the last three bullets, I would say. We need to find a smart and cost-efficient way to do this ramp-up. We need to have a process excellent mindset. We also need to use data-driven capabilities to be even more efficient. We need to see that we have the right system, IT system. How can we use AI, for example, to be more and more effective? With that said, I think it's time to take you out into the reality and make sure that you can see our state-of-the-art new building, 6,500 sq m outside Stockholm here in Rosersberg. I'm saying a video, please.
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Okay, there we have one of our important puzzle pieces in the capacity ramp-up product we are doing at MilDef today. Finally, we also have climbing up in the value chain. We have talked about this sometimes. We're coming in prime contractors around in the IT solution, tactical IT solution area, delivering more of the turnkey solutions. It's about transforming MilDef from being a pure box supplier into something else, a system house in this kind of area where we can operate and sell more of just this hardware standalone or the software standalone. We can combine these two things or three things: installation and solution. We can be a system house of tactical IT solutions. That is what we're aiming for. Why are we doing that? One is, of course, to increase the barriers to entry.
If we're doing that, we're taking a strong position on the market and we will be a strongly entrusted partner. We do that by adding capacity and capabilities and know-how and competence in the future, how we should do this journey. It's also about improving the margins, of course. More larger contracts, more complex contracts will also give you a better margin in the end. The way to do this, I think, is to deliver on the customer commitments. We have the customer with us in this journey and transforming and moving up in the value chain. That's really important for us. If we do the things right that we have committed to, they will continue to use MilDef in a wider area as well. Next one is around the focus expansion.
This is that we have said that now we have to keep a laser-sharp focus on really digging where we stand. We have a really strong customer list. We have 10 - 20 big accounts that really could be the one that's driving MilDef's growth forward and doing the big impacts, I'd say. We need to be able to prioritize the key customers in this attractive geographic area. That's the most important thing for us now. We can focus on them and we can focus to give them the best support, giving them the best solutions. We really have this customer-focused solution. By doing that, we will become this trusted long-term strategic supplier on the selected MODs and primes. That will be very important for us. The final one is resilience, of course. Maybe someone is thinking what resilience has to do with growing the company.
In our industry, that is really, really important. To be able to be trustworthy enough to get big contracts, higher volumes, we need to have a resilient MilDef. That's about multi-location manufacturing capacity. Just a couple of years ago, we had one single manufacturing capacity in Helsingborg. Today, we have more than that. We have the U.K., we have down in Germany, for example. We have really created a multi-location manufacturing capacity. Also, as I said, redundancy in the organization, bringing on new people, more competence, more know-how in the industry into MilDef. We have our own supply chain, of course, resilience on that, how we work with that, making sure that we can have the components in right time, making sure that we have dual and triple sources of most of the components. In that way, I have added cybersecurity as well.
Of course, we're working already today really hard with the cybersecurity and trying to protect everything we can. This is, of course, a race. We need to continue to invest in the cybersecurity, create a resilient company, a more trustworthy company that would take on more business in the future. As you can see here, something that we always have with us, even if we prioritize these four areas, is sustainable business. It's not just about the climate impact and things like that. In our industry, it's much around having anti-corruption, anti-bribery. Now our customer, we know the end user. We know the end user of the products. We really become a responsible supplier of tactical IT. That's really important for us to make sure that we have this ethical compass really tight calibrated and we know what kind of end users and end customers we have.
It's really important for us. The final one, M&A. We have talked about M&A since the IPO in 2021, and we have added a couple of M&As. The latest one was a quite large acquisition in Germany. We will continue to have the M&A later on. We will continue to look at what would be a strategic fit into MilDef. What kind of targets do we see that could be suitable for MilDef to acquire? It's important for us to not be out there just to make acquisitions for making acquisitions. We really want to become something good. We need to find something there. One plus one is more than two. We would continue at least to have an M&A later on. Now I will do a quite quick overview of the numbers that matter.
Some of you have probably already seen this after our release of the Q2 report, but at least to give you some numbers into the rest of the day here, so to say. We were talking about the fast-growing tech company, and of course we can take it even back to 2015. Then you have seen a CAGR of 26% in growing rate. If you take it from 2021, we can see that we have accelerated that growth and now making CAGR of 36%. That is where we're coming from. As we said, we are a fast-growing tech company. We have some proof in the potting as well for 2025. There is some evidence in the order backlog, SEK 1.5 billion for deliveries in the second half of 2025. If you compare that to what we did full year in 2024, it was SEK 1.2 billion.
We will do more in the second half than we did in the full year in 2024. Of course, we have an impact from the acquisition of Roda Computer GmbH, but still that's 400. It's SEK 1.1 billion organic-wise. That will be a challenge, and that is why we're feeling the growing pain sometimes, and we are steadily increasing the capacities all the time. If we look at next year, for example, we saw when we closed the Q2 that we are in a good position. We have an order backlog, even if it's not the biggest one for 2026, it's still 125% more than we had at the same time in 2024. There is strong evidence in the backlog that we will continue to be able to grow the company. A very important KPI for us is the gross margin development, of course.
Every percentage here, percentage unit will give a big impact on the bottom row and the margins there. We have been on a good journey, I would say. We have been on the trend towards above 50, and that's due to the customer mix and the product mix. As we said, we're moving up in the value chain. We are adding solutions, we are adding software, and things like that. We're also the customer mix where we are selling more directly to the government side. You can take one layer away instead of selling directly. It's more of a subsupplier further down in the value chain, so to say. Even if this is volatile quarter by quarter, I see that the trend is really positive. The effect that you're seeing in the second quarter there is related to the acquisition of Roda Computer GmbH.
It's expected to come down a little bit. Roda Computer GmbH is operating with a little bit lower gross margin, but they have a higher EBITDA margin than us. This is a little bit different character in their financial profile, so to say. We look at the EBITDA development. We saw a really good trend going forward there. Now we have a little bit drop in Q2 there. If we look at the order backlog and if we're making sure that we're delivering what's in the order backlog for the second half, I'm quite sure that we will see that the trend will continue to raise and move up towards again, so to say. Just a deep dive also into the working capital.
You can see that it has really gone up, but that's, of course, due to the acquisition of Roda here in Q1, where we have the full inventory and net working capital from the acquisition at once. We'll have the net sales over the upcoming 12 months here. This will, in terms of percentage, come down. End of Q2, we said 38%, but I'm quite sure that we will come down in a range of 25% - 30%, something like that before year end. I think that MilDef should operate somewhere around 25% in net working capital. That would be a suitable level for a company like MilDef. If we look at the net debt to EBITDA, we also can see that we have the acquisition-related effect here. Of course, we are moving up to 2.9.
We have a long-term target to say that we should just temporarily be above 2.5. This will come down when we now look at when we're closing 2025. I'm quite sure that we will come down somewhere in the range of 1.5, 1.7 maybe, because when we're adding more and more from the Roda acquisition, this will also come down. Also, a quick overlook of the financial targets. We have quite ambitious targets, I would say, to grow this company with at least 25% per year. We have been able to do that, as we saw in the earlier picture here. We have a CAGR since 2025 of 36%. We have now the last 12 months, we are exactly on the target 25%. We have the profitability target of at least EBITDA 15%. Last 12 months, we have 10.3%. We have something more to do there.
I think when we're looking into the order backlog, as I said, if we're making those deliveries, I'm quite sure that we can come maybe above, but at least very close to the long-term target here for 2025. We talked about the capital structure, and we also have the dividends policy, 20% - 40% of net profit. In 2024, we did roughly 20% dividends payout. Now I have come to my final slide, just to wrap this first part of this up before I leave over to the next presenter here. I have the headline, "Well-Positioned for Further Growth." I think we will show here today that we have some evidence and proof in the potting. We see a market situation, high demand landscape going forward. We know that MilDef has the right position. We also have a proven track record of growing. I think that's important as well.
We know how to grow a business. We have the growth mindset on. We are an ambitious, forward-leaning organization. We want to become bigger and stronger. That's really important as well. We have been doing this for a couple of years now, so we know how we can find smart ways around to continue to grow. You can take with you, of course, what really will drive the market going forward. We have the increased NATO spending, 5% target. That will be a lot of new money into the defense sector. We have the Buy European as well. That will be a game changer for the European defense industry, really having an impact. We also have what they should spend the money on. I think digitalization is top of the agenda for the end users. We will have a total bigger kick of defense spending.
The piece that's addressing the digitalization and addressing what we are doing at MilDef will also increase. In the near term, of course, we have growth supported by a strong order backlog. There we will see in the second half of 2025, making we make everything we can to deliver that. Finally, also, and also a cliffhanger for the next presenter here is that we have a well-established and field-proven offering. We are doing a combination that MilDef is a really trustworthy supplier on the market. I think I have five seconds left. I don't really know what to talk about, but quite good timing, right?
Doing fine, Daniel.
Now it's zero.
You nailed it, don't you think? On the money. Well done.
Thank you.
Thank you, Daniel. Daniel will get back shortly. The Q&A will be the Q&A because time is running short and we have a full flight. The next presenter will take us behind the "We Armor It" message. We have done a flyover now with Daniel, a zoomed-out flyover. We will now zoom in. Actually, we have 30 minutes for this slot. This is the longest slot. Feel no pressure. You packed a good suitcase. We will go not only into the product assortment, but beyond the products and really talk about what the customers really buy from us. Fredrik Persson, CTO and Deputy CEO MilDef Group.
Welcome back to you who were with us last year as well. I'm still Fredrik Persson, CTO at MilDef. I just start to say how much can really happen in one year. We're standing here now 12 months after the first Capital Market Days. I was a bit worried about how much news could appear today. As you know, the defense industry is moving faster than ever, driven by the geopolitical situation, of course, and the digitalization of the battlefield. I think MilDef is moving even faster than that. That's very interesting. A few things to just bring up here in what happened last year that I would like to highlight is, of course, the acquisition of Roda. We will also get Westek as a company in.
Except just 150 great colleagues we got with that acquisition, we also get products that we add to our portfolio and capabilities and capacity that we now have locally in the U.K. and in Germany, which I think is a real, real advantage for the future. We have also communicated focus on defense. That meant that we integrate selected products from Handheld and capabilities from Handheld into MilDef. We now have that integrated under the brand MilDef, and that will make our offering even better. We have some great success with OneSys, our software. We won some great contracts delivered, and we have a new customer in a new country, and we have done a fantastic delivery and added a fantastic new historical capability to Swedish Marine. I will not say more about that, but Fabian, the star here, will come later on and tell you about that one.
If we're moving to the system integration solution deliveries we do, we have some great contracts during the year as well. We have both business-to-business and business-to-government business. We have one contract with, for example, FMV and KONGSBERG. For me, standing here, we usually say that we're moving up in the value chain. We want to do more. We want to be a system house. That's really proof of we're actually doing it. It's a quality stamp for me to see that we get the trust to do that kind of business. It's really, really impressive how quick we can do this. That was yesterday. We need to deliver as well. Together with the new facility in Rosersberg, we are actually positioned as a system integrator within the tactical IT. I see we're moving closer to being the prime here in the Nordic countries, at least.
The MilDef journey, yeah, it continues, and it's going quicker than ever. That growth is something normal for us. Those minutes left here, I will want to talk about what we offer. I will repeat some of the things I said last year as well. What we offer, our portfolio, our hardware, software, and solutions. We'll try to get behind the products, why customers choose us, and why they continue to come back. That's not only about technology and products. It's not just about delivering technology. It's about business to ensure mission success from day one to the last day of service. We'll not only talk about what we deliver. It's also about how we deliver it. I mentioned focus on defense. For MilDef, that means that we target and deliver to Army, Navy, and Air. That's the essence of MilDef. That's where we are from.
We deliver hardware, software, and turnkey solutions to all three of those domains. We drive the digitalization. We want to enable the data-driven defense. They should act faster than the enemy in the end. Of course, defense is bigger than that. We keep an eye on other domains. We have cyber, we have space, and we have the total defense. There are opportunities in the future there as well, but not that big today. To my trickiest slide of the day, try to explain what tactical IT is. Daniel mentioned it. He mentioned tactical IT, a tactical IT provider, also the backbone. What are we actually doing? Try to do that in one slide. What are MilDef doing? If you look in the visualization here, some sharp eyes maybe can see that that's a CV90. It could be any military platform at all.
It could be land, it could be air, and it could be on the sea because they are built on the same principle. We're saying system of systems. What do we mean with system of systems? If you see the gray boxes there, a system of systems are built on many subsystems. It could be a better management system, navigation system, radio systems, intercom systems, and many, many more. This is just an example of it. They are easy to say what they have individually, which affects what functionality they have. They need to work together to get the full defense capability on the platform. Someone needs to make sure they work together. MilDef comes into the picture.
We try to have our products in the middle there, both an IT infrastructure, and IT infrastructure normally then secure the communication, take care of data processing, seamless integration, interoperability, and so on. That makes sure that every subsystem works together, the right information gets where it should, and you can get it out. The hardware is doing it in a physical way, connecting it, make sure electrical connections. We need software on top of that as well. Otherwise, we will not get any applications. We don't get out information. On top of that, we're also delivering the workstation, the operational environment where you can consume the data. You can monitor, control the system, and you can command and control the operation. In total, MilDef delivers a backbone to make sure everything works together seamlessly over time.
Itself is not a subsystem because it really adds very, very little value itself. Therefore, we deliver a backbone, not a subsystem, but the backbone is important. If you compare with your houses, I think most of you have a Wi-Fi router at home, and you have a lot of connected devices. You have an alarm, you have a smart TV, you have some Internet of Things connected. What happens if the Wi-Fi router goes down? Nothing works. You have some children screaming or whatever. It's not good. Just think about the consequences if that happens in the battlefield. The IT infrastructure is the MilDef products. If they go down, you don't see anything. You don't have any surveillance. You don't know anything. You can't use anything. We deliver those products where the stakes are the highest and the requirements are the toughest.
Just think about the consequences if we don't deliver and it doesn't work over time. That's the context what MilDef tries to deliver. The information on the battlefield today is almost equally important as the firepower because you need to be up and running there. This is all about delivering the full system, make it work, and the end user using that system needs to have trust. We need to deliver reliable solutions. In the end, it's about delivering the right information at the right time to ensure the right decision and do it every time. I hope you understand a little bit what we're doing by this. We deep dive into the portfolio. I will keep it on a high level here today because we have hundreds of products.
I can stand here the whole day if I should go through that, but we try to keep it on a high level. This is how we usually present it on top level. We have hardware, we have software, and we have solutions. You also see the split. Hardware is where we come from. That's our DNA. That's what we have done for more than 25 years, delivering hardware into the context I just described. It's proven hardware. We have the software, and that's basically OneSys and the software that OneSys brings into the systems. Small part, growing quick, big interest. I always say it a little bit about the rock star in our portfolio. There's a lot of buzz around it. Everybody wants to know more. I will not talk about it because Fabian is here and he will do it much, much better. We have our solutions.
That's basically our services to our customer, where we combine our proven hardware, our proven software into a defense capability. That's where we actually create the effect at the customer. With the proven hardware and the proven software, we get the trust from a customer to actually do the system integration and doing the services. Who can be better than we to actually integrate our own products? If we go a little bit deeper down in the portfolio then, hardware, what is hardware? It's a really wide range of products we have. We have mobile computers, displays, computing and servers, networking, power, and peripherals. A lot of different products. If we stay with mobile computers, that's where we started from. It's today much wider than it was just a few years ago. We have in the mobile computers now introduced products from the Handheld portfolio.
Here we have everything from Android devices to digitalized soldier, drone controllers. With the acquisition of Roda Computer GmbH, we also have a partnership with Panasonic. We also now have a little bit more of cuts products, shorter lead times to fulfill the need in that area for our customers. The big part of this is still the products delivered by coming from our partner in Taiwan, Crete, who has the ultra-rugged laptops, tablets, notebooks. It's very customizable and durable. We're out to our customer that we're still going to do business with. A mobile computer here in the technical IT environment is the operator environment where we actually consume the data. Displays, the same thing, HMIs, that's displays, panel PCs. It was not a very big part of our portfolio or our sales for just a few years ago. It's going rapidly quick.
There's a big increasing demand of displays. Every platform has many displays today. We are positioned as they're very well. Last year, we did an asset acquisition from a small company called AVT to get in the right technology to be able to build up displays from the bottom up in-house, everything from FPGA programming the whole way up. With the acquisition with Roda, we now have a really, really wide range of displays in our portfolio. I think it's one of the most complete portfolios in the defense industry here with rugged displays. Now we can offer displays from 6 in, 7 in, 8 in small displays up to 65 in video walls for visualization in command tents. Really impressive and interesting to see where it takes us. The rest, I mean, that's part of the IT infrastructure. There's everything needed: computer servers, networks, switches, routers.
What to say about them is even if we sell a product or we develop one product, we always design it to fit into a bigger purpose, into a system. You can do that by modularization. You can do that by having unified connectors, pinouts, colors, just to make it look great as well, important. Yes, you have the right experience of them. You can combine them. This is an example of our form factor 19″/2 . Combine them, put them into a rack in some cases and transit case, could be in a vehicle, could be wherever. This makes it a modular buildup. We can actually combine the products after what's needed in each system. The modularity also allows us to easily interchange the products every year when we need to update the platforms. What are the unique selling points for our hardware then?
I would say it's the form factor over time. We don't just talk about long life cycles. We talk about life cycles for a platform. We need to replace our products two, three, four times over a generation of a platform, a vehicle. Our modular design, I talked about modularity to build our systems. Our products are also on the inside modular buildup, and that's really important. In that way, we can easily customize our product. We can do them as the customer wants. All of our products are designed for defense. They have long life cycles. They fulfill military standards, NATO standards, all the standards out there to easily really be prepared to be used in that content, in that basis. That was about our hardware. An extension of our portfolio there is the Westek products. We don't have one harmonized roadmap or portfolio yet.
Just to give you an introduction, James Pickles, as I mentioned, the Director of Westek, is not here today. I try to present what Westek is. Westek is a company, actually the oldest in the group, I would say. It's from 1986. It's been here around. It's trusted in the business. It's not a newcomer. It's based in the U.K.. It has all the in-house capabilities needed: design, production. It can do that full. It can take responsibility for products over time as well. They do type of products very equal, very similar to what we do. The form factor is something else. They're more of an industrial standard in form factor: 19 in racks, 19 in products. Easy to install in integration. They're not as ultra-rugged as our products are. They're a little bit different applications there. They're not competing, no overlap. It's just complementing what we already have.
I see a big, big, big possibility with this because there's a big demand, increasing demand on high-power units. Talking a lot about AI. I mean, applications that need power. Here we have the Westek portfolio now that will really be integrated into MilDef. I think there will be great success in the MilDef here. I mean, they deliver to land, air, and sea as well. Their current growth shows that there are interests, there are possibilities. I think getting into the MilDef on the sales, using the MilDef vehicle to sell them as well. I see a bright future there. Just the foundation here, you can see what possible customer or current customer they have, very similar to what we have as well. They are trusted in the business.
It will be a fun journey to get them into MilDef and see what we can do with them as well. I will not talk about software. We have Fabian here. Going to solutions instead. How do we see in solutions? A solution is when we're turning technology into defense capability. There where we have our services is project management, system engineering, design, and integration services. Here we work side by side by our customers. We understand their needs and we transform that to a solution to get the effect on the field. Of course, we integrate as much of the MilDef hardware and software we can. We are also honest and select fit for purpose. It can be third-party products as well, both on the hardware and software side. Otherwise, we don't deliver the full effect.
MilDef is still a small player, and there's a lot of things that we need to add that MilDef can't do. We do the customer's need, deliver the full effect, and we take the responsibility of a full life cycle management there. We can maintain it over time. Here, this is about taking responsibility. We need to offload the customer. We take full responsibility for system design. We can also enhance the defense capabilities by doing this and offload them with capacity. We come up in the value chain, more strategic partnership. We can be more proactive by doing this even when we develop the software or the hardware and have the products ready when they need it because we have the information, we have the strategic partnership. It will reduce complexity for a customer.
They have one guy to go to, one person or one company taking responsibility that handles all the sub-suppliers. They can get tailored solutions. We try as much as we can to use our standardized products, which means we can reduce the lead time to deliver a full system. In the end, of course, there should be a win-win situation for us and the customer. We can create this for a customer at the same time enabling more sales of our hardware and software. To the question I started with, it's what's behind the products. It's not only about what we deliver, the products, hardware, software, or services. It's also about how we deliver it. What customers are really buying? I would say it's very important to have the right technology delivered. It's equally important to have the right capabilities.
The customer needs to feel certainty and trust that we deliver in time and we deliver something that works over time. Otherwise, it doesn't matter what we have, what products we have, and what technology we have. The combination here, capabilities and portfolio, is extremely important. I could say it's 50-50 here how to successfully get into the market. How do we do that then? We have the full MilDef design house, and this is valid for hardware, software, and the solutions. We have the capability here to actually customize to fulfill the customer requirements. We can do that based on our standard products. The portfolio I showed, that's the basic for it. Every single platform out there has their specific requirements that we need to take care of, a specific setup, specific configuration. Each delivery almost needs to be taken care of at the MilDef design house.
There we turn the standard products into customer-specific products, bespoke products that actually feel that's exactly what we need. That's the value we add here. It's our modular design on the inside of the product or in the software that makes us able to do this in a competitive way. In this approach, with our full responsibility and owning the process from concept to design, verification, manufacturing, delivery, and support and aftermarket, we create the trust that we actually can do it, and we can ensure the fulfillment of the customer requirements. This is really, really the unique selling point that we do that in-house. We have the experience. We have the competence to do this. I can feel confident that we can take the responsibility to do this over time, that the products fulfill the customer needs and will work over time. It's about doing this effectively as well.
It's easy to just put in a lot of people and do more and more and more, but that's not scalable. How do we do this in an effective way? I mentioned it. It's our modular buildup. We have built up, and we call it IP bank modules over time. We have been in business for more than 25 years. We have a really big technology IP bank we can combine to create a lot of new products. That's a prerequisite to actually have an effective design house because we don't have to be innovative and develop complex products from the ground all the time. I would say it's the foundation of the delivery for each delivery. Of course, we have the modular technology where we have proven building blocks, and I think that's really important. Proven building blocks means that they're already out at customers.
It's building trust at new customers. They're already proven and designed for all domains. There's a big customer base to actually target. Then economy of scale. We don't have to sell the same product every time to get the economy of scale. As long as we are really good at reusing the building blocks, the proven building blocks, we can get the economy of scale. That means many customers, many computers, but we use the same building blocks. We get the economy of scale. We can get higher margin. We can be more competitive in the market. It also means we can share all the overhead on more customers, more deliveries, and we get real competitiveness here. Reduced time to field is important. In the times we live now, everything is about delivery on time, delivering as quick as possible.
By doing this, we maybe don't have to do a real prototype round. We can do pre-sales direct because it's so proven. It's already tested. We only have to change some small things, and we can get out on the market. Here we can go from idea, from customer demand, to deliver out in the field much, much quicker than if we didn't have this big bank of modules. We can do it without compromising the quality and compliance because it's proven and already used modules. I think also it's much easier to get a return of investment in our R&D because we can focus R&D in a smaller part on technology, not new products every time. In that sense, we work very close to our customers. We get ideas of what they need. Next year, we can do it in smaller modules which we can implement in many products.
Here is the thing. We say that our customers pay for most of our development, and we can just invest in the small modules, in the really edge technology that we don't have in the module bank. I would say this is really our competitive edge to our customers. If you look at our big competitors, it's usually the big primes in Europe. They have the same capabilities as us. Usually, they are limited in how many customers they can have. The big primes will not sell to another big prime because they are competitors on a platform level. We can have all the big primes as customers. In that sense, we can get up in numbers, in volumes. In the end, we can do those products much cheaper than the big primes can. I don't understand why they shouldn't select MilDef.
Coming back to what I said, what customers are really buying, why are they coming back to us? I would say the most important area is we deliver on promise. We can do that by our competence, our experience, and our proven designs. We have to understand not only technology. We also understand the mission where products are used. We can help the customer to select the right technology and do that thing. Delivering on promise is about integrity. Integrity is actually one of our core values in our culture as well. We do what we say, and we say what we do. That's important for MilDef. That's why we are here today, I would say. That's the culture. The mission-ready capability, I already mentioned it. It's proven. Our customers trust it. It's ready to go out there. Maybe the most important in the whole MilDef, the people.
People who deliver. Committed people that always walk the extra mile. They're unafraid to challenge all the usual out there, how the big companies do. We say we're still a small company, still want to be agile, still do a little bit extra that you maybe not always get from the bigger companies. We have flexible technology. With that, I mean we always find a solution. We are still a tech company. We have a lot of people with great competence and great ideas. We always find a solution for a customer. Together with other things, that's fantastic. Here in the end, I think this is why the customer comes to MilDef and why they come back in the combination with our portfolio and how we can deliver it. This is something I'm really proud of. That's fantastic. In the end, I also try to change our view of it.
We talk about competitors. What's the strategic advantage for MilDef here? Why can it be hard to get into the business? MilDef has decades of trust. We have delivered to those customers in many, many years. They trust that we will deliver on promise, that we will do these things, not just what we say. We're close to our customers, both all the time, to understand the needs, what they need in the future, develop the portfolio, but we now also build up local delivery capacity. We have sales locally to understand the need. We have engineers close to the customers, but now also the capability to develop and produce, manufacture. We have a redundant supply chain. Our supply chain is not one single. We have three, four different supply chains to be able to not stand a falling where we're only one.
I think, and I need to think that, our combination of hardware and software solutions is unique. The combination there is that we actually can take the responsibility for the backbone of the technical IT. We feel really comfortable with doing that. We have the agile innovation. We are still a small company. We're still doing what customers need, but we're really good to do that in a way so we can reuse that experience and that development in many customers and share our experience and help them to get up in capability. With that said, I would say if this business would be easy, then there's nothing for MilDef. Complexity is actually our edge. It's not our challenge. That keeps us in the position we are because this is not easy. Last year I said MilDef was founded on three principles.
Going back to that, I'm quite proud to say that we're doing the growth we do. We still have the same focus. It's military focus, it's digitalization, self-requirements, and the ability to deliver when it truly matters. I'm really proud to say that we grow and stay true to our core, and that's fantastic. I'm proud of what we've done and what we will do in the future. Thank you very much.
Thank you so much, Fredrik Persson, CTO and Deputy CEO. No doubt, a lot has happened in 12 months where you started since the last time we were in this room. We're 20 minutes short of a coffee break. We know that we'll get some energy up in 20 minutes. Before that, you have followed us, some of you maybe from 1997. More likely, you have followed us since the IPO in 2021. You know, perhaps, that we have made eight acquisitions over these years. MilDef Group has purchased eight companies, and today we meet two of those. In 2021, we purchased a fine consultancy firm, Sucint, in Norway, Oslo. Sucint carried a true gem of a deployment software, namely OneSys deployment software, into the MilDef Group.
Here to explain the somewhat intricate story behind the unique selling points of the OneSys story is the actual technician, the brain behind this much today sought-after software that is today not only used in Norway, but in other countries. Before I give it all away, Fabian, I want us to give a warm applause to Fabian Forster, the inventor.
Thank you very much, Olof, for that great introduction. I'm Fabian Forster. I'm the Business Manager for our OneSys product, and I've been tasked with trying to explain our software in a non-technical manner. I'll do that in about 20 minutes. To start off, we'll give a short film. Introduce the product.
Please run the film, Erik.
OneSys, the solution for automated deployment of IT services at the tactical edge. OneSys deploys applications and services in a reliable and efficient way on servers, detached computers, and command post computers on land, at sea, and in the air. OneSys provides a new, flexible, fast, and reliable way for automated deployment of tactical IT capabilities. It simultaneously installs your command and control system, services, applications, operating systems, and security configuration on a vast number of different hardware. OneSys meets NATO security requirements for classified systems, and OneSys' core services are compliant with the NATO FMN interoperability standard. OneSys gives you unsurpassed speed and reliability when deploying IT services at the tactical edge. Faster and more reliable systems deployment at the tactical edge. Improved security and availability through automation of well-tested configurations. Better resource utilization through automation. NATO FMN SP3 core services compatible.
OneSys, the solution for automated deployment of IT services at the tactical edge.
Okay. Some of the challenges that we are trying to solve with our OneSys product is that we see an increased digitalization of the battlefield. Software and complex systems are being introduced in the battlefield. This increases the IT complexity at the tactical level, and it's difficult to have subject matter experts in the first line of defense. Another thing is interoperability with allied forces. What does interoperability mean? The word has been used many times in this presentation. In simple terms, interoperability is the ability to work together to create a common situational awareness in the battlefield. To do that for the computer systems, we need to configure them according to NATO standards, and we need to follow NATO procedures.
There is no magic here. There are a lot of good standards out there that NATO has published, and we need to make sure that those computer systems are configured accordingly. Another aspect is the adaptation of new technology. Things are evolving faster and faster, and it's a hard time for the defense to adapt to all this technology. We think we have some good solutions for that. The conflict today shows us that operational resilience is more important than ever. We need to create computer systems that can withstand over time because conflicts can last for a long time, as we can see around us. Our software, what is it? It is a software for automated deployment of IT systems. It is specifically tailored for deploying in the tactical domain, at the tactical edge.
We have created a software, a software framework that can automate that deployment and create an IT platform that can host those applications and services that the soldiers and warfighters need in the tactical field. In comparison to our competitors, our product is hardware and software agnostic, which means that we can integrate not only on MilDef ruggedized computers, but we can also integrate on more civilian computers. For instance, if you're in a command post, you can use civilian computers. If you're in a main battle tank, you will use fully ruggedized computers. We give our customers this flexibility. We are also not tied to any specific battlefield management application or command and control applications. We are agnostic, so we can onboard the preferred applications that our customers would like to use for their use case.
As part of the configuration, we automatically configure the system based on the classification level that they are going to use. We'll add that security hardening to make sure that it can operate for classified military IT systems. This open and flexible design makes it easy to reuse this IT platform or IT foundation across multiple IT systems. Our customers can use our software not only in one system, but in multiple systems. The advantage of that is that you can train your personnel, and it doesn't matter if they're working in ARC or LAN. It will be the same IT foundation being reused. As Fredrik was talking about, this modular design. Onesys is a module that our customers can reuse in multiple systems. If you're in a CD90 or an MBT, it's the same IT platform.
Maybe the hardware and applications are different, but the IT platform is the same. The gem in the solution is that we configure our services, the ones that we provide with our offering, the core services, as NATO interoperable. That means that when they connect into a NATO mission network, they're able to communicate and federate with their allied partners to create that shared situational awareness. The key selling points for our product, to try not to be technical, is rapid and robust deployment. You don't need those subject matter experts. You can be a generalist, and you can use our tool to deploy the software and configure the system. We reduce the complexity through standardization and the automation that we provide. Through this mobility that we can help our customers create, we can help them increase operational resilience. This is my personal opinion.
With the flexible and open architecture, there are easier ways for our customers to integrate and adapt new technology, and there's less of a vendor lock-in because if you want to select another battlefield management application or another command control application, it's easy to change those products. We're not locked into any vendor on that side. It provides a NATO fast-track interoperability for the core services, and I'll come back to that in one of our customer reference cases. Onesys started back in 2019 when we were contracted by the Norwegian Armed Forces to create, develop, and maintain their tactical IT platform for their deployed mission networks and their tactical information systems. That's when the journey started. We had our first deployment in 2021, so it is a fairly young product, but it's evolved really fast.
Today, it is the foundation for their battlespace management and command and control systems across all domains. We are especially proud to be here in Sweden and talk about our Swedish delivery. We have a record speed delivery. We were contracted in late December 2024, and within three months, we were able to deliver a NATO interoperable command and control system onboard a couple of vessels in the Swedish Navy that joined the standing NATO Maritime Group. That was a record speed delivery of about three months. We're also supporting the armed forces in Sweden with deployable mission networks so that they can deploy those NATO interoperable systems. We provided a fast track for NATO interoperability. In these projects, we've used our OneSys software together with hardware and system integration services delivered by MilDef. We also have two other countries.
We are unfortunately not able to disclose those names today, but maybe later, where we support them with their mobile deployments and mission networks. It's their foundation for their tactical IT systems. For both those nations, it has been a fast track for NATO interoperability as well as it has been for Sweden. For one of these nations, we also provide a digital twin. We provide a digital twin that can be seen as a copy of what we would see in the tactical level, but it's hosted on the data center so that the officers can do their training, and they can do simulation and operational planning from their desktop computer. The environment they see is identical to what they'll see when they're deployed in the battlefield. This is a very efficient way to do training, simulation, and operational planning.
Moving forward, I think these are the three key elements for us. OneSys is, as I said, a fairly young product, so we need to evolve it to support a richer ecosystem of software and hardware products. That's a process that's going on to meet customers' demands and to be able to support even more capabilities. Evolving our products will enhance our ability to support multi-domain operations. As an example, onboarding command and control applications for the air domain would give us a better standing within the air domain, of course. This is something that we're continuously working on. Once our product's now beginning to mature, I think it's about time that we start expanding our market initiatives targeting NATO countries and also prime system integrators.
There are many huge platform deliveries, as you know, where we will not be the prime, but where we, in partnership with the bigger primes, can offer a complete C4IS solution to the customers. I will be around for the Q&A and also for the lunch, so if there's any technical questions, we can take those then. I was a bit ahead of schedule, I see, so there's a good time for coffee.
It's perfect. Nobody gets worried about if times are shorter. Thank you for an excellent presentation, Fabian Forster, the inventor behind OneSys. Thank you for that. Just like Fabian said, he will be participating in the coffee and the lunch and the Q&A session, which will follow. By the way, thank you, ladies and gentlemen, for following our live broadcast online on YouTube. If you have questions for the Q&A, please address them to olof.engvall@mildef.com. You find my name on the webpage and my email address. I'm the Head of Investor Relations, so please write me questions if you want them relayed during the Q&A. In the room, we do the raise your hand. We're at the halfway station of our show today. We have learned lots, and we will learn much more in the second act of this show after the coffee break.
I will now change timing a bit and say that we will be back in 20 minutes, 10:40 A.M. 10:40 A.M. is the time when we will revert into the room and we will crash on the webcast. We will then travel into how we sell and to whom we sell, and we will make a very special field trip down south to Lichtenau in Hülhorst in Germany to visit our recent acquisition, Roda Computer GmbH. Thanks for watching so far. Have a good coffee break, and I'll see you in a short 20 minutes,
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Ladies and gentlemen, welcome back to the Capital Markets Day, hosted by MilDef Group 2025 edition, live broadcasted from Stockholm. We're in this room with many lovely guests today and online with several hundred participants on the webcast, I've learned. Thank you, ladies and gentlemen on the webcast for tracking along on the exciting MilDef journey, the fast-growing Swedish tech company. We will now venture from what we sell into where we sell it and how we sell it. You all know that we are brought up in the Swedish-Nordic context, started in Helsingborg, traveled out into Sweden, traveled into the Nordics, traveled out to the U.K., U.S., and something very exciting and transformative happened in 2025, in this spring.
That was when we purchased and acquired the German company Roda Computer GmbH, a truly transformative acquisition that in one stroke makes MilDef Group almost twice the size in turnover this year. We'll get back to that story in a few moments, but first, we will talk about sales and marketing, and we will do it together with our Vice President Nordics, a gentleman who arrived in this very room one year ago for his first working day for MilDef Group. Please welcome our Vice President Nordics, former Gripen fighter pilot and Saab longtimer, Mr. Magnus Hagman. He gets an applause, doesn't he? Yes.
Thank you, everyone, and what a year it's been. With the reference that Olof just made, it felt almost like we went supersonic over this year. I'll try now, when we go into my part of the presentation, to go subsonic again to keep you all within the aircraft and not leave you on the ground. I started one year ago, and with that, I came in and oversaw the Nordic business. The business that we do, you've seen this slide many times, it's the distribution of what we do. It's true to the core still. Our business is based on the hardware provisions. That's where we come from. That's how we evolve our offering. Solutions, we're growing into that, and the portion of solutions will remain, maybe even grow a little bit, but that's where it sits.
On the other hand, MilDef, Daniel just talked about it before, the growth path that we run, there will be a substantial volume increase when you're making out 25% of a larger volume. Fabian's sharing of software represented by OneSys, which is the nugget in our solutions suite, where we actually bring true capability and interoperability to the customers. The organization, sales, and marketing, although not on the screen. I'm overseeing Nordics, but at this presentation, I will also bring you in on the remainder of MilDef, where we are in the other parts of the world and how we address these different regions and markets. We have, as Olof shared, staff in Sweden, Norway, Finland. We have our long-standing presence, our origins here. We're engaging in Finland. We have representation there, and we're engaging in the Baltic countries.
This is where our sort of engine is for the sales organization going out into MilDef Group. With the acquisition of Roda, we had reinforced our presence significantly in Northern Europe. We now have a second engine from sales within the sales department of Roda and growing into the Nordic, North Europe, Western Europe, and Eastern Europe through that foothold. In the United Kingdom, we have staff located in the U.K. covering the U.K. market. In North America, we have staff in the United States engaging in the North American markets, predominantly for the United States, but of course, we need to cover Canada as well since it's an important market, part of NATO. What has happened? I mean, we talked about one year. Olof was a little bit wrong. It was my second workday at MilDef, not the first. Anyhow, just what has happened in 2025, a lot.
Just some notable things, looking into Nordics, some Nordic flags here, as you see, but we also have a U.K. flag. In April, we landed a refurbishment IT rugged equipment order, well north of SEK 100 million. This was followed also in April by, for an undisclosed customer, a provision of IT equipment through Westek, just as Westek had been part of MilDef Group. In May, we relocated and co-located our Oslo and Greater Oslo offices into one in the very center of Oslo, close to the central train station and close to the defense cluster that is in Oslo on Grevensplass. We had the former Swedish Supreme Commander Micael Bydén giving a speech and talking about how cross-border cooperation and regional cooperation becomes more and more important to ensure that our governments can buy European. In June, we landed an order of significant value with Kongsberg Defense Aerospace.
The team has worked with this order for a very long time, worked closely with Kongsberg. Why is this a little extra? I will remain on this one just for a few seconds, and that is that it changes MilDef's position in relationship to Kongsberg and Primes. We're now part of the provision of capability of a suite of capabilities to an air defense system that Kongsberg sells on export. In July, we landed the first OneSys order for the Swedish Army. That came originally, as Fabian talked about, from the Swedish Navy in the early part of this year, but now we're going into the volume of the Swedish Armed Forces, which is the Swedish Army.
We see a volume ranging between almost SEK 140 million up to north of SEK 200 million, depending on how the Swedish Army would call off options for this contract, but more to follow. How we build and demand and how we sell, I think almost everything I'm going to show you now has been said by my colleagues, but repetition is key, so we'll do it again. Trust, long-standing relationships, personal relationships, willing to listen, willing to be there, willing to walk the extra mile. That's what's MilDef. That's what we're doing. That's what actually creates the demand to continue working with MilDef. We prove and have proven over and over again that you can depend on us. We deliver what we promise and we deliver on time. Yes, it's challenging sometimes, and demands might change mid-program.
We do our best and we do it in discussion with the customer. We customize to make sure that it fits both our roadmap and the customer's needs. Our B2B customers mentioned one, we talked about Kongsberg now added into a different modus with us than they've had in the past. There are several other primes that we are targeting. We also, with the software, will start having more in-depth discussion on how we could, with our software, be part of their total solution when they offer it to the end customer. Tenders is not a large portion of our business today, but we still keep track of it. We need to ensure that we're up to date on what's going on. That's not only to address business, but also to gain intel, especially in markets where we are not as present as in Sweden and in the Nordic countries.
Finally, of course, marketing. There are multitudes of things that we do. We're beefing up our marketing team. We will add resources, but more importantly, knowledge and tasks on that marketing team, especially on the demand generation side. Our market position is not dissimilar to the previous picture I showed on presence, but we do a little bit different, and we dress the market a little bit different depending on which region we look at. If I start with the Nordics and Baltics, here we address the market with a full portfolio going straight to the end customer. We base our discussions on the long-standing relationship that we have with end users and the authorities that acquire these systems. We take on a large responsibility in the deliveries, and we are asked to grow that responsibility.
Finland and the Baltic countries, we have presence, we have a business track record, but it's not on the same level currently as it is in the other Nordic countries. Our share of wallets, if we look at the part where we could address, it's smaller in these countries, and that will be addressed going forward. For the DACH region, spelled out Germany, Austria, and Switzerland, we now have a solid foothold with Roda being part of MilDef Group. MilDef has been doing business for quite some time in Northern Europe, Eastern Europe, and Western Europe, sometimes through partners, sometimes on our own, but often in partnership with Roda. The relationship with Roda and MilDef goes way back, so it's evident that we have been... It was quite easy onboarding, I would assume, but more importantly, the relationship when it comes to sales is already there.
The rest of continental Europe, we continue to view that part of Europe as hardware business mainly, majorly done through our partners that we have out in Europe. In the United Kingdom, our operations, including sales, are predominantly centered around the provisions of our products to U.K. armed vehicles and platforms, tracked and wheeled vehicles. As Fredrik said before, we're not limited to that. We have examples of that we are in the domain in the U.K., etc. Now with also Westek being included into MilDef Group and that part of portfolio complementing our offering, I see options of growing further in the U.K.. Last but definitely not least, North America is predominantly hardware sales, business to business.
As I think everyone, you know, the American market is massive, and therefore we have chosen to target B2B because we feel that that is where we get the quickest effect on our efforts in the current landscape. Competitiveness. Is MilDef competitive? Sure is. We see us today as kind of unique. We offer a combination of hardware, software, and services into solutions. In certain markets, I would argue that there is no one within the IT sphere that can match this. There are international players, multinational players that could do this, but they don't have the local footprint, they don't have the trust, and they have the cultural knowledge to come into the relationship that we have, again, our long-standing relationship. Our offering has grown. I mean, this is why we have this unique position.
The combination of what we have in our portfolio, we can sell it separately, we can sell it in smaller combinations or the full suite. Sorry. This gives us a unique position. The hardware portfolio, in certain aspects, especially business to business, we still see a preference to stick with our hardware provisions. That's where we are selected because of product adaptations. The customer can get what they need. They can change peripherals, they can change connectors, they can change how the equipment is to actually perform. The customization comes with that as well. Our long business track record in the Nordics and Germany gives us this position, again, reinforcing our position as unique when it comes to provision of IT solutions to armed forces. Some of you may recall that this picture, or are very custom to this picture, was already brought up last year.
What we're trying to say here is that we have customers and relationships on all levels. We have direct relationships with end users, with the business governance authorities, but also with global primes, as well as partners that support us in markets where we may not have the capacity to have local presence, where we still feel that we want to be present. Many of these examples, I had a multitude of logos and had to choose a few. If anyone in the audience feels that we should have brought something else up, it sure is on the other page that I deselected. What are we doing and how do we prove this? We have a couple of customer references. One of what we have seen in media and in our press releases repeatedly coming back is the provisions of hardware to CB90.
We are doing this directly to Bjorn Hägglund, but also in combination when we're providing cybersecurity to these vehicles together with our partner Clavister. What we are doing here is that we are providing the hardware and they are loading it with their cybersecurity capabilities and giving these vehicles the protection they need also in this area. The units on order are exceeding 1,400 and more to come. I'm sure the CB90 is an unparalleled success. The unfortunate events in Ukraine that have been going on, or events, not even war, that have been ongoing for now three years, are showing that CB90 is what the armed forces need in matter of mobility and protection. In the U.K., this MIV program, together with Rheinmetall and BAE Systems, has grown for us. We have added further capabilities, further products into this, and continuing the deliveries over several years to come.
One of the key elements of this is the local presence. It's approved supply chain. We're doing local manufacturing, testing, and through live support. Make U.K., like many others, is here to stay. We need to be local in order to be successful. My final customer reference is stealing a little bit of thunder from Frank coming on the stage later, but I know that he's allowed me to use this one. This is how we provide hardware to the German armed forces. We're supplying the latest technology and through FormFit Function design philosophy actually puts us in a very good spot with the customer. That's actually the enabler for this to happen. We see continuous deliveries of this with the possibilities for further growth in additional orders later on.
This is just one of our, these three in total are just a few of many references that we can bring forward. Finally, summary and outlook. We're focusing our engagements in regions and markets where we are established and present. Yes. We also need to continue to work through partners and be adaptive on where needs arise. Our total offering, bringing it to solutions, and in that integration and installation is included, it allows us to provide a capability to the customer, not just a product. With the growth in the armed forces' demands, the time or the pace that they have to now pick up, the European industries are fighting over resources, a quick capability ramp-up. It means that we are suited to take on a larger responsibility in these programs in partnerships with the primes.
Yes, we might sometimes compete with a prime in a selective part of their portfolio, where there might be a slight overlap. Because of that, we have the full range of IT solutions. At the same time, we're partners in many other aspects and sometimes full suppliers to these primes. It's a finite market, the European defense market, and we need to stay true to our core and at the same time provide the best service that the armed forces should have. Finally, reference back to Fabian's presentation, which I found was very good and not technical, Fabian, so happy for that. We will, of course, get feedback later on, so we'll see if people agree with me. The increased interest that we see across Europe on the OneSys platform, that's the X factor for market development.
In parts, we can address this through the provisions to a prime that in turn, so when they win, we win. We've also seen in the Nordic markets that we can do this ourselves. The pace that the armed forces require when they want to have a fast track and get this deployment, then we need to rid ourselves of layers where the armed forces actually end up in a situation where they get the capability, but they get it too late. I'm leaving it hanging there a bit, and I think we will come back later on in other forums on the OneSys, definitely. Thank you.
Thank you so much, Magnus, and apologies for saying that you've only been in one year. It's one year and one day. Sorry for that. Also, good point, feedback, we're very, very grateful if you want to give us feedback. You can email olof.engvall@mildef.com, as well as you can do on the webcast to relay your questions for the coming Q&A. That's really coming up quite shortly. Now we're ready to go on in the show. [Foreign language] Frank Scholz.
[Foreign language] , Olof.
[Foreign language] , Olof.
Yes. I really appreciate to be here and to present Roda as a new part of the MilDef Group. My presentation will cover the typical company presentation, but I will give you some more backgrounds of these and that and what we think is important, what we have to send out as a message. Later on, I will give you even additional information about the situation in Germany in total, what we are faced with. I think that would be very interesting for you. Daniel already touched this topic. With that acquisition, we completed the footprint in Central Europe. What you see here is that we are strong in sales in Germany with 76% on sales. We always try to be more successful in other countries, but the problem was that we become more and more successful in Germany itself. That was a blame.
Together with Roda SAS, we are active in France. Directly, we are active in the Benelux, in Switzerland, in Austria, in Italy, and even in Poland. The rest of Europe, 16%. We add to the footprint already existing in the U.K., Westek. Westek is now not under control, but deeded by MilDef Group, and this was a reasonable and good decision. We are operating from two different locations in Germany. The one with the headquarters is located in the southwest, close to Switzerland and close to France. Here, you find the main management and other administrative departments. We just opened a new office building with 900 sq m . That means we have space and we have resources even for future ramp-up. Around 50% more staff is no problem at that location. The second location, the Roda Service Center Hüllhaus, sometimes we name it the workbench, is located close to Hannover.
Here, we entered in 2022 in a new premises with around 3,700 sq m . Again, we can increase the workspace within that infrastructure up to 50%. In total, we bring into the group 150 employees together with Westek. Roda comes with 38 years' experience, so a little younger than Westek, but older than MilDef Group itself. Last year, we had a record year with EUR 83 million in total. I already started from the beginning. Roda was active in specialized mobile computing. Since the end of the 1990s, we started to work with the German armed forces. There is a long history behind that. We always try to come to long-term relations based on frameworks I will discuss and will explain later in a little bit more detail. 2012, it was a very important year because I entered the company and we expanded the company with a small electronics company.
Then we changed from a distributor to a true developer and production company. That's why we had to expand in 2015, the new production site in Hüllhaus. It is important to be present somehow in France when you are operating there. We opened a sales office in 2018. Yes, the Westek acquisition from Roda at that time, so that was now three years before, we started 2022. Last but not least, we were acquired by MilDef last year. Now, I come to the most important, the employees and the people in Roda. I highlighted the head of the manager because we have a very strong and experienced and qualified management team in Roda. This team in Lichtenau are familiar with the cooperation with MilDef over years because our business was always based on a partner cross-selling agreement. The people were aware and familiar with what's coming up after the acquisition.
That was totally different to the team in Hüllhaus because they only saw some boxes sometimes; they just move, and that's it. Because of the guidelines of a public trade company, it was necessary that we only allowed that we inform them one day before. It was a surprise for them, by the way. The picture on the right with the Swedish flag was made two days after the acquisition, November last year. What we found out over the integration time, there is a strong spirit very similar to the MilDef Group itself. It's not easy to integrate, but we have the best basis and the best people for that. Roda stands for quality, and these quality processes and procedures are developed together with our key customers as well as with the German armed forces itself.
All test routines are adapted to the problems or the challenges we had in the past and were improved over years and over years. The German quality inspector team is minimum two times a week in Roda to check all deliveries we send out. Another example, or I give you four examples for the very close relationships we have with our customers. First of all, I want to inform you that, yes, the workstation used in the Lynx and Puma infantry vehicles are cooperated, developed with a so-called big prime. This is something, yes, when you do this cooperated development over years, because it takes one year of development, then you need the proof of concept, you need the qualification, and so on and so on. That brings people together. Problems are very often helpful to create a closer relationship.
The next example, this is what we do with a company called Secunet. We create.
so-called SINA Workstation, it's a crypto client for mobile and extreme operating conditions for data communication up to top secret. This is a quasi-standard in Germany for data communication in classified areas. We did this not only for this generation, we did this already for three generations over the last decade. This is even a proof of trust. Next one, even not that super highlight, but even important that we are so close, we create an obsolescence solution. For different already, more or less expired main battle tanks Leopard in different variants, they need a monitor that is fitable in different generations of the metal tank. We made it together. Here we can say it with KNDS. The last example, the situation table that was driven by the soldier themselves. We come to them and show, yes, this is our display.
You can use it and display the better management system and say, no, we need a table with a computer with some legs. Can you do that? Yes, we can do that. Within three months, we had this first prototype. After half a year, we got already the contract and last year was delivery time. That is something, how close you can work with the end user. Sometimes rotors are familiar or popular for good and fast reselling products. Yes, we are the power seller of Panasonic Toughbook in Germany. We can sell these products between four and eight weeks. This is in most cases for autonomous use, not platform connected. For the rest, we do true added value. That means most of our products we ship out are customized for specific applications. This is very important.
What we started in 2012, we developed and created our own external power supplies. We consigned in 90% of all our deliveries. Rotor products will be delivered depending on the complexity within three and nine months. We are partnering for 12 years minimum now with MilDef. We sold products. We don't sold systems. Now with this IT system infrastructure, there's a new approach. We already started the beginning of last year of this new thinking, and we were already successful for that. We placed a 19″/2 solution from MilDef into our portfolio and to pack a full infrastructure or subsystem to our customers. This is a little new approach in comparison to the past. A good reference is we already saw this in the reference cases of Magnus, the Boxer U.K. reference.
We use some of these developed and mission-proofed products even for platforms we will use in Germany. You know that slide, the route to market structure. I modified it a little bit and put on the Roda glasses. We have direct contact to the end users in Germany with the Bundeswehr, the Swiss Army, the Austrian Bundeswehr, and the DJR. This is necessary. You have to understand the application of the field. We are in contact with the big primes, starting with SICONET, Rheinmetall, Airbus, KNDS, Thales, MBDA, HENSOLDT, and Diehl. For countries where we are not so directly active, we use distributors: Ziltec in Poland, Gomai in Italy, Zurcom in Benelux, and RC Computer in Ukraine. These partnerships are running now even over decades. What is important is that it's not just an ordering process and forget. This is something we do for a longer time.
We have framework contracts, and a framework contract covers a certain product catalog, and the duration is not a month or a year. It is several years. These agreements are existing for the German Bundeswehr with NATO, SICONET, Rheinmetall, KNDS, and Airbus. I want to give you some more details about this framework structure because it's a key word you will hear very often. Again, it is limited in time. For the German armed forces, and Magnus already mentioned this contract, we have a maximum budget of around EUR 82.5 million. Over five years, the duration for such a framework can be maximum seven years. What is great here is that it is not only this framework. We have additional agreements for the technical logistics support. That means we check out the compliancy for next-generation solutions within the timeframe of the framework. Another thing is a service and repair contract.
That means all products that are sold to the German armed forces run under these processed and simplified repair process procedures regarding prices and even for documentation. Now I switch to the topic that could be interesting for you. What's going up in Germany? We are faced with a historical ramp-up in German rearmament. The European Union will support the European countries with an extra budget over the next years with EUR 150 billion. It is decided that there will be an increase in Germany up to 3.5% of GDP. They will invest in different, we call it, megatrends. This is closely connected to Daniel's presentation. Now you will hear it with my words. There is a continuation of the digitalization of the battlefield. The keyword is software-defined defense. Yes, we talk about software, but Roda, MilDef products are the carrier for this kind of software.
The use of unmanned systems in all domains, air, sea, and ground. Strengthening of cyber defense capabilities, use of artificial intelligence to make processes quicker and more efficient on the battlefield, and sovereignty, independent supply, European supply chain. Here, in all megatrends, MilDef and Roda are represented. I challenge you with a German slide. That is something you will like. I steal it, but I want to give you some explanation because it's not easy to understand. There's from the German MOD, a financial plan for the next three or five, or three up to five years. You see, starting from 2019, it is really flat. It was 1.2%, 1.3% over the year. What happened in 2022 was, yes, there were attacks in Russia, not in Russia, otherwise, other direction. In Ukraine. Yes, there was an extra budget for EUR 100 billion, all newspapers wrote this, and we were super excited.
What happened in 2025? An extra, extra something. Now we jump to 2.4%, and the idea is to jump, to ramp up 2029 to EUR 152.8 million. The budget is already approved up to 2027. This is the situation we're faced with. I give you one example where the investment will go in. I can use different platforms like the Leopard, the Puma, Caracal. The Boxer is well familiar, popular in that audience. I take it again. At the moment, there are much more under contract, but in operation worldwide, there are 1,000 Boxer in Australia, Netherlands, U.K., and Germany. 1,000. There are much more under contract. For the next seven years, the German armed forces ordered another 2,500. That is massive. Plus an option of another 1,000. We are just talking about one platform. There are much more.
My conclusion, together with the MilDef Group, there's a lift in value chain, boost of growth, strategic planning. Now we create a European strategy together. A continuous improvement. We take the best things of both companies and groups and bring it to one. Yes, and we make it better and better. There's a redundant development. For production sites, Fredrik already mentioned this. There is a strong will in the company. Money is available. We have to do our job. That's it. Thank you very much for your audience.
[Foreign language]
Thank you very much.
Excellent presentation. Thank you, Frank. Thank you for bringing Germany closer to Sweden. We are now at the final stage of the final stretch of the flight. We are soon to deploy landing gear and go into the Q&A. Again, raise your hand in the room if you want to ask questions, and I will line up the questions for the audience or for the management team that will stand up here shortly. Before we do so, we will look into the future outlook together with CEO Daniel Ljunggren.
Thank you very much, Olof. Nice to be back on stage again, and I really appreciate all the MilDef team presenting here today. Now we have come to the point where we should boil down everything that we have talked about here today, and we should, in some kind of way, bring forward the crystal ball and see what we see coming up here in the future. Of course, what everyone has told today, I think we have some evidence, and it's hard not to talk about this strong outlook for the future. We have heard about all the different components and the growth drivers that we have seen within this industry and how we are connected to that and where we can place MilDef into that journey. Some of the biggest ones, I would say, is the high demand landscape, and it's here for today.
Frank was talking about the money is there, the budget is there. It's up to MilDef to make sure that we get some pieces of it. We will probably see this high demand landscape being here for more than 10 years out in time. It's really a good market situation that we are in right now. On top of that, I would say, and we have heard this tons of times today, what should they spend the money on? Digitalization of the battlefield, creating systems of systems, building this data-driven defense capabilities that's really important in the future here. I joined actually an event two days ago, had an opportunity to listen to Kongsberg from Norway, Saab from Sweden. I listened to Rheinmetall from Germany, for example. Everyone in that room was talking about just the digitalization part, how they should do the digitalization of the battlefields.
I think that what we are doing, what our contribution to that, the IT backbone that Fredrik talked about here earlier, is a really super important component into making that happen, the digitalization of the battlefield. Really, really strong position on the market. Someone is talking about this defense tech supercycle. There will be tons of investments into different types of technical solutions within the defense. That is how we can build strength, so to say. Before we join the Q&A, the final, and maybe for me at least, the most important thing, and I think for the MilDef team as well, is that MilDef is ready. MilDef is ready to make a difference in the European defense race of the capabilities. We are ready to be a part of building, this is what someone's saying, building peace through the strength, so to say. We have a field-proven portfolio.
We are a long-term trusted partner within this defense sector. We are really motivated to make a difference in this European ramp-up. That's my final word to say, that MilDef is ready to do what they need to do in this building peace through strength.
One could say that the only thing you need to bring from this day is to remember MilDef is ready.
Absolutely. That's one of the key words at least to take with you, but also maybe the other two ones are really important.
Thank you, Daniel Ljunggren. We will now go into that scary moment of the Q&As where we really don't know where we'll end up. I know that there are many talented analysts, both sell-side and buy-side in the room, so I count on many good questions. Before we shoot the questions, you will raise your hands. I will start with you, sir. If you have questions online, email them to olof.engvall@mildef.com. I already have a few questions for Martina and Karin and also Daniel. We will line up first and see that everything is working here. Everyone is mic'd on, so you need to stand quite close to each other. That's not going to be awkward because you're good friends. We'll fire away with the Q&A. I think we'll go to the gentleman who needs a microphone for the webcast audience of 200 people to track along the questions.
State your name and your question, please.
Thank you very much, Fredrik Lethell from Handelsbanken. Thank you for the presentations. Very insightful and educational. So good to be here. Daniel, in your presentation in the start, you talked about resilience. There are a few extra things I would like to ask about when it comes to resilience and the financial resilience. You have frameworks that run over multiple years. What do your clients feel you need to secure on a financial level? Gearing, for example. Is there any discussions on that? It would be interesting. Supply resilience. Who do you get your components from? Do you work more with getting supplies from sort of near shore, if you like, a popular word? Also expanding capacity. How do you make sure that you don't trip on that very fast run you are in now? Those three would be very interesting. Thank you very much.
Thank you very much for the question. I can start with the first one. I think it's super important to notice and remember that, of course, they are looking to their supply chain and making sure that it's resilient in all kinds of ways, also in the financial part of it, of course. That's absolutely something that we need to keep track on and make sure that we're taking care of to have a strong balance sheet, to have some financial power, making sure that we have a strong cash flow because that is something that will be important for the customer, making sure that we could be this long-term trusted partners over many years. You're absolutely right. It's not just about that we have this decade of trust in the defense or what we're doing, how trustworthy we are.
It's also making sure that we have the financial position to make sure that we can deliver what they are asking. You have to remember me some of the other questions. You were talking about the supply chain and how we can strengthen the supply chain and how we can add more of a local supply chain into that. I think we already today have a strong supply chain. We talked about that, that we have many sources that we can use for the same components and things like that. I think we are in a good position already today. Of course, that is something that we need to work really hard on. We need to understand the supply chain in details.
We have people that are doing that on a daily basis, tracking down the supply chain, making sure that we don't get any shortage of components and things like that that could be impacting future deliveries and things like that. There was an expansion part, the capacity ramp-up. This I think is some kind of headache for the whole defense industry. What kind of pace should we hold in this one? I think in some kind of way, we need to continue. We are adding on a lot of new capacities and capabilities in terms of new people coming into the business in all areas within MilDef. I think it's in some kind of way, I think that we have underestimated the power and the force that will come ahead of us now when a lot of countries are really starting to spend the money.
We have heard a lot on the news that they should spend the money, but still they sit on their bank accounts, so to say, in different countries. They have not really started pushing out the big contracts. I think that is something that we will see starting from the end of 2025 here maybe and going into 2026. We need to be ready for that. I also have stated sometimes that we can't have like 200 people on the bench waiting for the next contract. There needs to be a balance how we can increase the capacity. The increased capacity and scaling up is important for us to win new big contracts because back to the resilience, not just the financial part, the big customers, if they're going to place the big contract at MilDef, they're of course looking into how should you solve this kind of big contract?
What capacity do you have to really make sure that you can deliver in the end? Sometimes we need to invest before we get the contract, invest in people, invest in facilities, and then we will be ready, and they will be ready to make sure that they can place the big contract because we have the capacity to take care of it.
Thank you, Fredrik, for those three questions. I will actually interlace with a question from the web. You say that you grow a lot and you need to put in more muscles. What about recruiting of personnel? What about that resource? I would turn to Martina Karlsson, who is the Chief People Officer. How do we go about our recruitment need going forward? Do we need to recruit a lot, and is it difficult to get those people in?
Thank you, Olof. Yes, we of course need to ramp up that as well and to add more people to the company. I would say, yes, it's difficult, but we are sitting in a much better seat today than we did one year ago. As a lot of people want to work for MilDef, we have good candidates coming through in our own channels today compared to what we had one year ago. It is some positions that are more difficult than others. We have system engineers that we are hiring lots of. Many of them out there on the market, they have a core on software. We need a niche on hardware and the understanding of software. We find them. Absolutely, we do. For the first half of the year, we had 80 new employees that started. That was only end of Q2.
I haven't counted on the Q3 analytics yet. I know just a couple of weeks ago, we had 12 new employees standing in the entrance one Monday. We are busy onboarding them as well. The competence is out there, but we need a lot. We are active.
You could say that we're building a new company almost every year. It seems like it's a new company.
Yes, a lot of new people and new energy.
You have a cool job. Thank you, Martina Karlsson, for talking about that. I have a question online as well, actually oriented. Maybe that's a mix between Frank and Daniel. Could you please discuss how Roda Computer GmbH has been selling the 19″/2 since 2012? Historically, how much have 19″/2, the MilDef Group traditional bespoke products, how have they contributed to Roda Computer GmbH sales? What has changed since the integration? If you want to try to start, since 2012, you started with the 19″/2. How much of it has it been and how has that evolved?
I can express this in numbers. That is what I remember. We had to put it on the table, around EUR 300,000 up to EUR 500,000 a year with 19″/2. We already, yes, multiplied this by 8, something like this.
Going forward, don't say too much now.
This is just more or less the beginning because we see that there's a high interest in 19″/2 in our territory. We were not expecting this. Now we have the full support, the sales support to doing this, yes, business much more logical that it's easier to understand why or what are the advantages of these product concepts. Yes, we are at the beginning. Absolutely.
Another question from Joey Friedman online is, could you clarify Roda's reseller business? Is it fair to understand that 35% of Roda sales come from MilDef Group and Panasonic Toughbook resales?
No. We have our own products in Germany. What Fredrik already touched on is the display technologies. All displays that are coming out from Roda Computer GmbH are a Roda product. The most important thing is that we combine things. Even for the things coming from Crete, there is a customization part we can even do by ourselves. Some things will be done in Roda Computer GmbH itself as a, yes, German IP.
we're on Roda Computer GmbH, we have questions from owners, Norwegian owners up in Oslo. Can you, Frank, please spend some time on the competitive landscape in your key markets? What does the typical competitor look like in Germany?
Yes, it's not a one-by-one comparison. My answer to this question is, at the moment, the cake is big. It is what it is. We improve our business and we are strong in that. There is no direct competitor. In some cases, we are partnering and sometimes we are in a competitive situation, as Magnus already explained. We are not alone, absolutely, but we are strong in our situation in Germany, I would say, number one. Yes, we can improve that.
I'm sure you can. That's what you're working for. I think that Hugo Liescher, who is one of the, together with Tom and Erik, of course, and Daniel, the best defense analysts in Sweden, with Carnegie, or rather DNB Carnegie, sorry for that mistake. Hugo Liescher, we talk almost every day. I mean, come on. You must have millions of questions. Go away.
Thank you for the kind words, Olof. You've been quite confident about the future. To hit your 2025 growth financial target, you have to add about SEK 2 billion in order intake for deliveries in 2026. How confident do you feel about this number?
I think I just take the question. I'm just jumping into it directly. Thank you very much, Hugo, for the question. I think that the SEK 2 billion is more of coming from your side, maybe. It's not coming from our side. It's nothing that we have said. We have stated, and I can repeat that again, that I feel quite comfortable with a long-term growth target of 25% year out in time, three to five years, something like that. I think it will absolutely be doable organic-wise. We don't need to mix it up with some acquisition part of it.
Of course, we need to build a strong order backlog for 2026 and beyond 2026 as well. Now we have the second half of 2025 to really make sure that we are getting down all of the opportunities we see out there into the order backlog so we can plan and have some visibility for the 2026 deliveries. I'm quite comfortable that we can meet our long-term financial target upcoming three to five years. After that, of course, it becomes more blurry and also the 25% will be tougher and tougher in absolute numbers, of course. I see a bright future in the three to five years coming up from today.
Thank you. You also mentioned a strong order backlog that's in for 2025. How confident do you feel in making all these deliveries of SEK 1.5 billion in the second half of 2025?
As I said before, of course, it's a massive amount of deliveries that need to be done in the second half of 2025. As I said, we did SEK 1.2 billion in full year 2024, and now we're going to do SEK 1.5 billion. We have, of course, looked really deep into what that second half looks like, and we feel quite comfortable around all of the deliveries. We have the capacities. We have the planning already done, so we feel quite comfortable around that. Of course, in this business, there's a lot of complex products, complex solutions in the end. We can run into something that we can't see today. I'm not going to stand here and make a 100% guarantee that we will deliver everything on that.
We also have the opportunity, as we heard Frank talking about, with a shorter lead time, for example, maybe also adding something in the second half where we can have some orders and also making the deliveries before we close 2025. There is a mix of things there, but quite comfortable around the SEK 1.5 billion. I don't know if anyone would like to add more to that question. No, but yes, connecting to what I said before, we have committed to those data to our customers. There's no, yes, the happy calculation behind that. We need to do it, both from a customer view and to deliver numbers as well. We feel confident, even if some part is stretched, it's at maximum for the rest of the year. We have increased the capacity after that. It will be some tough months, but fully doable.
OK, so my final question. You mentioned that you have employed a lot of new staff. How should we think about the cost increase going forward versus sales increase?
Of course, we will need to add OpEx, and that will grow. I don't think I have stated before that we have quite a scalable business. I think adding on this capacity and taking on the extra cost will be less than we see on the top line and the growth and what we see could be the gross profit, so to say. We will scale this company, but there will, of course, be money spending on the OpEx over the P&L, adding on new resources and things like that. We need to be not just relevant here and now. We need to be relevant in five, ten years as well.
We need to increase, and we need to make sure that we can take care of this high demand landscape in a good way, making sure that all of the capacities that were coming down our way, so to say. Adding on more people, taking care of the new people. As you can see with Martina here, we have a 20-year plan for the next potential candidate. We have a short plan and a long-term plan.
Thank you, Hugo Liescher. DNB Carnegie is really well versed on the MilDef Group story. If you get your hand on his reports, you will sometimes know more than Daniel and I know because Hugo is really diving into the programs in Europe. Yes, sir, Tom. Tom with Pareto. Also very well versed defense analyst.
Thank you. Question on your local for local sales. You mentioned a lot of your sales efforts are locally based. You're strong in Sweden and now, of course, in Germany. Can you address the Baltics from your Nordic offices, or do you need to expand geographically to meet demand there?
Thank you for the question, Tom. Would you mind putting the sound on? I don't need to use my... Yeah, good. The Baltic markets need to be seen as individual countries. In the wordings, we often lump them together, but they have three. They're three different countries with specific needs, requirements. The volume of their economies has in the past forced them, also with the Russian bear on their doorstep, forced them to have joint programs, joint views on different things. My opinion about the Baltics and how to address that is mainly through our existing footholds. As businesses grow in these countries, we need to be open to localized resources as well. From the get-go, I don't see a requirement to have a specific localized resource in any of the three countries.
They will be, I would argue, actually better addressed if we have resources tied into the company and up to date with the latest requirements in the other more strong markets in the Baltic region.
Perfect. Thank you. A question on Germany and the investment increases that you mentioned. You touched upon it in your previous answers, but we saw a bit of investment delays or procurement delays from Germany in the beginning of the year, given the large ramp-up in spending. What sort of lag are we expecting moving forward, and can we see a continued delay in terms of procurement moving forward, given the aggressive ramp-up in defense spending?
Great question. Please keep in mind that the budget was not released for a long time, and this was a big, big challenge. I have a good example I want to highlight. For the SEK 25 million approvals made by the German government, we had last year 100. Today, we just reached 17. We expect for the last quarter a sprint. I hope that answers the response to your question.
Yeah, definitely. Thank you.
OK, thank you. Before we go back to the room, I have a question that I find very important. We have 45,000 shareholders. Swedbank Robur is the number one owner on the cap table. Many, many fine names on the top 10 list and below. For many of those, again, especially Swedbank Robur, it is very important with the ESG and sustainability aspect of the responsible business of MilDef. I'm going to go to Karin now because last year we made a big sort of number here on stage talking about the ethical sales and, if I may, the responsible sales carried out by MilDef. The question to you is really the ethical compass, all those procedures regarding what countries and customers we're selling to. Where are we today? Has it changed going 12 months back? Are we as diligent in responsible sales as we were last year?
Yes, for sure. I would state that it's perhaps easier than ever, being a Swedish and Nordic defense company, to focus on our core markets, Europe, Nordics. If anything, it would be easier today to follow our ethics.
Because we can focus on these markets that we know, were grown up here, we have control because we don't need to go out on the limb somewhere else. Is that correct?
Yes, we haven't before either gone out on the limbs, but now it's even for this crowd easier to understand that we don't lose business by having an ethical stance.
Can you give us a glimpse and remind the audience about the ethical stance? How do we work with this matter in MilDef?
Yes, for sure. We have sort of a green list guiding us, and we put that list together from independent and global indexes that guide us with regard to democracy, level of democracy, and respect for human rights, and also corruption. The baseline is that all European or NATO or EU countries would be on the list, but all aren't there because some of them are too low on the indexes.
The MEC, the MilDef Ethics Committee, who is represented in this group, in this jury, so to speak?
Yes, for countries then outside the green list, we have the Ethics Council to decide on whether business should be done or not. Of course, we have sort of a red list, which is based on embargoes and sanctions and such. In between the red list and the green list, it's up to the MEC, the MilDef Ethics Council, to decide whether to do business or not. I chair the MEC, and there are also the Chair of the Board of MilDef Group, also the CEO, and the CTO representing the further going business, and also our Quality and Sustainability Director.
Thank you. If we have no further questions on this topic, or we go back to it, we go to the gentleman in the front row. Please state your name and your question.
Thank you. Johansson, Mike, SCB. Regarding your software offering and for a specified framework like this, when you sell your hardware, what would you say that the penetration is that you also sell software? What's sort of the potential that you see there going forward?
Good question. This combined offering, of course, makes us a more attractive partner for both primes and also the different nations. I don't think I have any figures for that. Of course, we are a more attractive offering because we can provide a more complete solution to our customers and the primes that we work with, the partners.
I just wanted to add something there. I think it's worth mentioning also that our software, the OneSys, is a strong enabler for selling more of the hardware, where we can sell a combined solution, so to say. It's also an enabler for getting into new markets, new countries, new customers that we maybe don't have a business with today. That software can be the one that takes us into that market, and then we can come also with the hardware and also maybe the solutions offering in the end.
The combination is strong, and the software is a strong enabler for more hardware.
Thank you for that. Second question on the new facility in Rosersberg. I think you said it's supposed to be up and running at the end of January 2026. When do you sort of expect to have a...
Two weeks from now.
Two weeks from now. OK. When do you sort of expect to have a sufficient capacity utilization at that facility? Do you expect to have a backlog that could fulfill that for 2026? What do you see there?
I think we need to see it like that we are really ramping up. Also, we'll take a little bit of time to come into the new facility and make sure that we are running at full speed in that one. There will be a move from the current facility into the new one that will take some time. I know that they are also not interrupting with the current project they are working with right now. They will try to do that in the old facility, making sure that they can deliver from that, and then they can make the move. This new facility, it's not about being up and running at day one. It's a long-term investment MilDef Group is making to be one of these, as we talked about, the primes in system house, tactical IT, also doing the integration part of things.
It's a really super important investment over time, I would say.
Perhaps maybe short term, do you expect that sort of ramp-up to have any impact on the margin side? What do you see there?
I think so as well. I think that is a very profitable business that we are doing there. The integration part will have a good boost of the gross margin and also the EBITDA margin going forward. I think also by increasing capacity, we can also be more efficient in what we are doing. What I hear from the project management at the site there, when you can do four different platforms at the same time, instead of just doing one, you can save some time and you can save some money. We can be more efficient. That could, of course, then give us the margins in the right direction.
Thank you so much for your presentation.
Thank you so much. I have a quick one from the web. I have a few from the web now. To Fabian, can you explain briefly the business model behind the OneSys offering? Is it a recurring license-based model? What is it really? Or is that a half an hour discussion?
I'll try and explain it together. Of course, there's a license. It can either be a perpetual license or it can be a subscription-based license. We have a maintenance agreement, which covers the updates and development and new functionality and capabilities of our products. Finally, we have integration projects because all customers need either a smaller or larger adaptation where we integrate their products and their security requirements, et cetera. There will be one or more integration projects for our customers.
Thank you. A question coinciding with this almost is from another person in the audience. What is the, and this is for Magnus, I think, what is the aftermarket strategy to increase the revenue stream and retain customers long term? Aftermarket strategy.
We are all retaining our customers. I would assume that this question drives at how do we actually increase revenue and recurring revenue over time besides these contracts that already come? We have today already an aftermarket offering allowing the customers to add different services, et cetera. I'm not going to dwell into that strategy. I'm actually going to come back to that question because it's under definition. It is an area which has my attention.
Thank you so much. This question is probably for Daniel. Defense talks seem to trade negatively with peace talks progressing. That goes every other week. Looking at spending trends in the future with the current macro backdrop, would a permanent peace in Ukraine tomorrow and not a prolonged war be positive or negative for MilDef Group's revenue going forward?
That's a common question that we get from time to time. First of all, I just want to say that I think we all in this room really want to have the peace and have the peace deal and have or at least some kind of ceasefire in the Ukraine-Russia conflict. With that said, I don't think even if we see a peace deal, I don't see that the European defense ramp-up will stop. I think we will continue. We have realized that we need to stand on our own legs. Maybe a peace deal or a ceasefire maybe could increase the threat against the rest of the Nordic and European countries instead. I don't really see that that will have an impact on the defense budgets going forward. We are now in this landscape where we really need to invest.
We need to pay for the underinvestments that we have done for decades going back. It's not going to stop. How long in time? Some people are talking about the full generation out in time. Someone is talking about 10 years. Someone is talking about 5 years. I don't have more crystal ball, but at least five to 10 years, I would say, is my statement that we will continue even if we have a peace or not there. We can all keep our thumbs for a peace deal.
Thank you. I will now close for the online participants. I will close the Q&A, send in of questions, and we will finalize the questions in this very room. Tom, go ahead again. He needs a microphone back in the corner. We are about to land the bird. Only a few more minutes before we have lunch and more time to talk to my lovely colleagues. If you have questions, prepare them now. Tom, please go ahead.
Thank you. A question on replacement cycles. Have you seen any shortening of the replacement cycles given the increase in time actually using your products? Or is that still the same if you compare it to, say, five years ago?
Yeah, parts you and parts me, I would say. We see, of course, there's a parallel ramp-up there as well. There are a lot of things that need to have effect today. You need to update the existing platforms. Some is donated to Ukraine, for example. Under the time you're waiting for new platforms, you need to update it and keep them at the same level on the digitalization. We see that in parallel. It's always volatile and comparative. We definitely see an upgrade of existing platforms as well.
The existing replacement cycle is some five to seven years, is that correct?
Yeah, it depends on the products. Yeah, five to 20 years. Very, very hard to say.
If I'm to add to this, as we see, I mean, Daniel Ljunggren showed that we're late cyclical. It means also that the armed forces have started to use their existing systems. I wouldn't be surprised, and I see some tendencies that the programs for replacements are larger than they used to be. That's the reference I have from the past as well, I mean, the volumes. That's partially because a larger volume of the fleet, if we talk a fleet or what you have in your total capacity, needs to actually be up to war standards than it has in the past. You've been able to accept that certain units have the latest and greatest capability, and others are just waiting.
They may even jump a cycle, and we take them in the next leap if required. Now the discussion is how do we lift the complete fleet. It's a lot of volume that actually increased cycle. I wouldn't be surprised, and that was the sentence I started, that as the armed forces now start to ramp up their capability and use the systems, of course, the wear and tear will burn through.
Perfect. Thank you.
Thank you, Tom. Ladies and gentlemen, that concludes the Q&A session for the 2025 Capital Markets Day. I will ask Daniel to stay on the stage and the rest of my lovely colleagues. Give them a warm hand, and thank you for participating.
Thank you, Olof. I'm not going to take too much of the time. I know that some of the people, at least in this room, are waiting for some well-deserved lunch outside in this room. I just want to take the opportunity to say thank you for the MilDef team. Really good presentations, really good effort you have put into this day today. I want to say a big thank you to Olof, who is really taking the lead on this show and really driving this in a safe and good way, so to say. A really big thank you for contributing to this day today. Finally, I want to say thank you to all of you coming here today, listening into our story, following the MilDef journey. I hope we have some shareholders in the room as well and contributing on that side.
A great thank you to all of you. Now you will have some lunch at least here. Online, they need to take care of their own lives, so to say.
Absolutely. Thank you so much for participating on MilDef Group's second, not the first, but the second, but the first web-broadcasted online show today. My name is Olof Engvall. Please reach out if you need me to facilitate and navigate you in the continued MilDef journey that you are on as shareholders. Take care. Stay safe. Thanks for now.