Hello everyone, and welcome to this conference call from Sandvik. I'm Jan Lissåker, Head of Investor Relations, and I'm sitting here together with our CEO, Olof Faxander, our CFO, Ola Salmén, that will present shortly and answer questions regarding the press releases published earlier today about the new strategies, the new organization, and possibly also some manning questions regarding the new group executive management. I would like to inform you also that if you haven't seen that, we have on our website a few slides that will help you, or guide you, or remind you about this discussion afterwards about the new strategy, the main messages in that, and the ambition level, the purpose, and so on. So they are available on the website under investor relations, obviously.
We have about one hour at our disposal for this. So without any further delay, Olof, would you like to start by presenting what we have published today?
Yes. Thank you, Jan, and welcome everybody to this conference call. I will talk just briefly then about this, the strategy that we presented here today. Firstly, I would say what we feel are the leading words in this is want Sandvik to be number one. And what we mean by that is that we want to really leverage the full strength of our group, and of course, clearly have an ambition to be leading in the areas where we are active. So the objectives are to achieve world-class profitability and, of course, then also shareholder returns. Looking at the strategy, we will be focused on the next few years.
We should have all aspects of the strategy up and running by 2012, and we have the ambition to reach our objectives by 2050. The main elements of what we're focusing on is to generate sustainable profits, and of course, also growth in the company. A lot of the growth in our markets is, or for our products, is in emerging markets, and therefore, we need to have a strong focus on that region of the world. We need to have a more active portfolio management in our company, and a clearer focus on challenging the businesses to deliver adequate returns, and improve the utilization of common resources across the group. Success factors to achieve this number one position that we are striving from, I think can be summarized in four leading words. The first one is ambition.
Really, to have the right ambition in the organization to become number one, and have a strong focus on delivering on our objectives, all throughout the company. And of course, with that, following a clear performance management, following up against those objectives that we're setting down the structure. The second word is speed. And for me, speed means simplifying the organization and flattening the organization from our current structure, which will facilitate faster decision-making, and of course, make us a more flexible and agile company, I believe, to more quickly adapt to changes in the increasingly volatile environments we all live in. The third word is focus. To focus both our efforts and resources on the core areas and the areas where we can get the best growth.
Again, then, clear performance management, again, focused on clear targets in the organization, evaluation, structural evaluation around the performers, and also the new organizational structure, I think, creates a much clearer, a more focused, management structure in the company. And the fourth word is to globalize. And Sandvik is a very international company, but we have still a very strong culture of being just a Swedish export-oriented organization. And we should, of course, build on our history, but at the same time, I think we have a need and a challenge ahead of us to transform ourselves into a truly international group. And with the growth being in, for example, emerging markets, and so that will be increasingly important going forward for Sandvik to secure our future success.
We also need to, where suitable, adapt our business model to our local requirements, mid-market requirements, in many areas where we might need to have different specifications of certain products ourselves. This is also very important to succeed in the future. So ambition, speed, focus, and globalize, I think are four words you should take away from this presentation. Looking at the summary, on the different levels in the company, the group will get a, on a group level, much stronger, a stronger mandate to drive common topics in terms of, for example, shared services, our people platform, talent management, et cetera. The business areas should be focusing their time on producing, selling, and developing their products and serving their customers.... on the business. And we should, where possible, avoid developing own support structures.
I think we can do that more cost effectively by sharing resources across the group. And then on the local country level, we need to, of course, also realize the synergies we have in all the countries where Sandvik operates. And areas like employer branding, recruiting, creating cost efficient structures are things that we can do by working together on a local level. Looking then at the five business areas we're creating, what is the change and why is this a better organization? Well, to start with, I would really like to stress that the ambition has been to create focused business areas based on the various markets they are serving and not have too broad a portfolio in each business area.
Therefore, we have split Sandvik Mining and Sandvik Construction into two different, or separate business areas. And the reasoning here is that clearly the drivers and the customer requirements in the mining sector are quite different from the ones in the construction sector. And by separating these two, we will have a much clearer focus on the requirements in the two respective markets. Then we have Sandvik Machining Solutions, which is really the core of the Sandvik tooling. Here we have some of our finest assets, and most notably, maybe, Sandvik Coromant. And this will again be a business area with a clear focus on the insert business, serving the metal cutting market here.
The fourth business area is Sandvik Materials Technology, which we have narrowed down to focus on really the core elements of Sandvik Materials Technology. And I think that is key for giving this business an opportunity to succeed. But they have a narrower focus on the management, on the key core parts of that business. And then we have a fifth business area, Sandvik Venture, where we have a number of different businesses, Process Systems, and parts of the MedTech business coming from the current Sandvik Materials Technology, and then Hard Materials, diamonds, Diamond Innovations, Wolfram, and Dormer, who were previously part of the tooling organization, but don't have as clear a fit with this key insert business that the Machining Solutions business will focus on.
Here we have some very strong and interesting businesses that we will focus on developing. It is also a suitable home for future possible development areas in the company. But we also have then more, more specifically, one area that we are stepping out of and that's the MedTech business in here, to allow the Sandvik Materials Technology management team to focus on the key challenges they have for the future. And since we've decided to divest the MedTech business, it is, you could say, a thing of the past then for Sandvik Group. Looking at just some challenges we have for the respective business areas and their profitability levels. Well, first, in mining, we have a very good profitability in this business.
But, I think we have an opportunity to increase that profitability level, even further by focusing on operational efficiency and developing our supply chain, in this business area. We also need to, of course, focus on maintaining the high growth rates that we've had historically in the mining industry, in Sandvik Mining. Sandvik Machining Solutions has a very high profitability level, and, focusing on growing our business in this area, as fast and as, as strongly as we can, is really probably the most profitable thing we can do in Sandvik, and that will be the key task for, for this, business area. Sandvik Materials Technology has been a very known underperformer in the organization for a considerable period of time, and, we are not happy with the current profitability level of that business.
We are, in the longer term, if we cannot achieve the right profitability, prepared to evaluate divesting parts or all of this business. But our basic focus now will be to lift the profitability of that business, and I think there are lots of things we can do in this area to significantly increase the profit from where we stand today. Sandvik Construction has a similar issue as Sandvik Materials Technology, with a too low profitability level. And here, the near-term focus will also be on turning the business around and lifting the profitability. And I think one of the challenges Sandvik Construction has had has been being part of the mining operations, which have much higher margins and a totally different customer setup than what you find in the construction sector.
By creating a focused business area on this, on this specific business, gives us much better opportunities to lift this profitability to acceptable levels. And then we have Sandvik Venture, which has a portfolio of companies with, each one there is their own challenges for the future. As a consequence of this new structure, we've made a number of new appointments to the group executive team. And, as I'm sure most of you are aware, the reason for the board making the CEO change, earlier this spring was that we had a significant succession issue in the top management team, of the Sandvik Group. And, I think by this change, we have addressed most of those succession issues that I was faced with this coming into, as a new CEO to this company.
Looking at the business areas, Sandvik Mining will be headed up by Gary Hughes, who is a mining engineer by background and has spent all his life in the mining industry, working in both Africa and Latin America, and most recently, in Finland, heading up the underground mining business within Sandvik Mining and Construction. So Gary will, has a long experience in this, area, and he will head up, the Sandvik Mining business. The Sandvik Machining Solutions business will be headed by Andreas Evertz, who currently is the head of the Walter, brand and, product area within Sandvik Tooling, and he will, take the position as head of Sandvik Machining Solutions, as of the first of January. Jonas Gustavsson, head of Sandvik Materials Technology, is, already a previously known, appointment.
We appointed him already this spring in connection with Peter Gossas's retirement. Thomas Schulz will head up the construction business. He is heading up this area within the Sandvik Mining and Construction business. He is also a mining engineer by background and has a long experience from both the mining and construction industries, both from Sandvik and previously, Svedala Industri. Anders Thelin, currently the president of Sandvik Tooling, will head up the Sandvik Venture business. So in addition to these changes to the executive management team, we also have one new appointment in terms of Thomas Nordahl, who will take up the responsibility for IT, sourcing, and strategy within the company, and succeed Peter Larson, who today holds these responsibilities, and Peter is retiring by the end of the year here.
Thomas has a background as a senior partner with the Boston Consulting Group. And, we should recognize that this is, I think, a quite significant change to the management of the company. We now create an international team, people with global experience and a wide variety of backgrounds, and also a much younger team than we had previously here. So I think this really strengthens the top management of the company, creates a diverse group with a very good skill set to face the future challenges here. So, with that, I'll end my presentation, and maybe we can open up for some questions if there are any.
Ladies and gentlemen, if you have a question, please press zero one on your telephone keypad, and you enter a queue. Our first question comes from Mr. Colin Gibson from HSBC. Please go ahead.
Hi, yeah, it's Colin from HSBC. Three quick questions, if I may. Question number one, do you expect the restructuring programs for Sandvik Construction and Sandvik Materials Technology will have been finalized in time for any associated restructuring charges to be posted already in Q4? And then two questions, really, not so much on the structural, structural risks, which you've clearly identified and are trying to act on, and about which I don't have too many quibbles, really, but more questions about the operational risk you see for Sandvik at the moment. Do you think, number one, we're likely to see a slowdown in your core markets between now and year-end? And then secondly, if we do see a slowdown in your core markets, how acute would your need for destocking be?
I think your group-wide Sandvik's inventories as at the thirtieth of June were only about 10% smaller than they were in June 2008. Would you need to see similar destocking to the destocking we saw in 2008, 2009, if we saw a slowdown in your core markets? Thank you.
Well, firstly, is there a risk for a slowdown this, the remainder of this year? Well, I mean, we have not made any new statements about the market situation or outlook since the Q2 report. I think everybody recognizes that uncertainty in the world around us has increased due to a number of factors, but I'm not going to speculate how and if that would affect the Sandvik business... regarding the restructuring charges in this stock and I'll hand over to Ola just to comment on that. Yes, it's Ola Salmén here.
We will go through these during the autumn now, and there will obviously be some need for restructuring of these two business areas, but we'll have to come back to that during this year, when we have done the detailed analysis regarding restructuring of these two areas. As to your third question on destocking, we said at the second quarter that we had our objective of net working capital not exceeding 25%. That's still there. We were above the 25%, and we are going to get down to below 25%.
And in that sense, we have a need for some destocking, not to the extent that we were in 2008, where we had a very big need for destocking and reducing the total net working capital. But we are still on our journey to get sustainable below the 25% hurdle rate. All right, thank you very much.
Our next question comes from Nicole De from J.P. Morgan. Please go ahead.
Hello, Nico.
Three questions, please. First of all, if you look, if you look at sort of the different statements that you've made around reaching world-class margins in, in mining or an improvement sort of versus peers, what does that mean? Does that mean sort of you'd like to reach profitability in line with Atlas, for example, in this division? Or, or should we look at that a little bit differently? Secondly, you've highlighted a, you know, that potentially we should set some targets, on the return on capital employed, on the EBIT margins, et cetera. Can we expect those during the capital markets day, or is that too early? And thirdly, just a very quick question, the new head of mining will be based out of Amsterdam. What is the reason for that?
Okay. I mean, Atlas is, of course, one of our key competitors and a key one of the leading performers in this sector. And of course, that is one of our targets to meet or beat them, of course. And we, I think in the longer run, don't see any reason why we that should not be a realistic target for us as an organization. I think your second target was your second question was about the group financial targets, and we have not changed them in conjunction with this release. But of course, it's a topic for discussion in the company. We have three new business area heads and one in a new role, and we are detailing now our plans during the autumn.
We'll have a process discussing the validity and, and how relevant our current, targets are. But that process will take a number of months, so it will not be something that we will be presenting or changing in the very, near term. And then you had a question about Amsterdam. Well, this move was already on its way for the underground mining parts, of Sandvik Mining and Construction. The reason they selected Amsterdam, and, Gary has been living in Africa, and then after that, he's been living 9 years in Latin America, in Chile, and now working a few years in Finland, but having his family in Chile. And the mining business is maybe the most extreme, business we have in terms of geographic locations. It's spread out on, all continents.
We have as much business in the southern hemisphere as we do in the northern or even more in the southern hemisphere. So the key for the mining business has really been to have a small head office for the business area, really at a place which is attractive for expatriates and where you have a fantastic network of airlines flying all over the world. And Amsterdam was found to be the most suitable location for that, so major international airport and a good place to build a management team based on many nationalities, which makes it in that business area.
Sure, that's very clear. Now, on the other business areas, you highlight a significant improvement in profitability. How should we think about that? Is that sort of an improvement which is more than 400 basis points or 500 basis points up, or is that sort of perhaps a little bit more limited? I know the business area presidents still have to go through it. I just want to get a bit of flavor of what significant means in this sense.
I don't have an exact number to give you, but of course, if you look at the pro forma Q2 numbers we've given, for example, construction and Sandvik Materials Technology, we are not—I mean, there we need a very significant change for them to be suitable parts of the Sandvik portfolio. So, the gap varies, I would say, by business area, and especially we need a clear step change in both construction and materials technology.
Okay. Thank you.
Thank you, Nico.
Our next question comes from Mr. Avi Hoddes from UBS. Please go ahead.
... Yes, hello, everyone. Just one question for me, and good afternoon. It's just on construction and pricing. I did see a comment, I think, presumably from a press conference earlier, about price deterioration in construction. Could you just elaborate on that, where you're seeing it, and really kind of how that started to come through over the quarter?
We haven't made any specific comments about any price developments in construction, to my knowledge anyway.
No, no.
Okay. Thanks.
Thank you.
Our next question comes from Mr. James Moore from Redburn Partners. Please go ahead.
Good afternoon, everybody. It's James at Redburn. I wondered if I could ask a couple of questions. You've talked about selling part or all of construction and SMT. Could you give us a sense of what your hurdles are here on timing, and how much of these assets you will keep? Is it just about getting the margin up to a satisfactory level to get an attractive price? And how do you think about the difference between keeping all of it, selling some of it, selling all of it, and the timeline on that? And secondly, could you just remind us, after all of the work you've obviously done since joining the business, why you think margins in construction and materials technology are so low? What's the key problem?
Specifically on the cost base side, what is it that's got to change?
Okay. I mean, divesting, if we will consider that, it's not something we have put on... We want to be clear that we will not have eternal patience with these businesses here. And my expectation is that they, or I know they will put in place very clear plans how they're going to make a step change in terms of their profitability in these businesses. So, a potential selling in the future is right now a secondary issue. I want to see the plans, and I think there is a lot we can do to really lift the margins from the current levels. And then that maybe brings us to your second question, what are the key problems?
Well, in SMT, I think it's been a lack of focus. We have been venturing off into new areas like MedTech and other areas. And I think the MedTech example is the best one, which has also been financially not a very successful path we entered into there. So bringing back the focus to the core and key elements of SMT, instead of spending management time on these new ventures, I think is a big change and a clear change from the past. And there are a number of things in terms of making the business more cost efficient, developing productivity and the product range.
Yeah, and a long list, actually, of issues that can be addressed at SMT, which I think have the basis to be able to lift the profitability significantly from where we stand today. Also at SMT, we have some investments which are already costing us money in terms of personnel, and here I'm thinking mainly of the steam generator tubes investments, which... But so the investments are nearly completed. We have most of the personnel in place, but they're not yet producing the product. So the ramp-up of these already ongoing investments will help in themselves also to lift the profitability in SMT going forward. Construction, I think, has had somewhat different challenges, and maybe belonging, I would say, to mining, has been the key challenge there.
The mining industry, there's a lot of tailoring of the vehicles. There's very high margins. It's a few demanding customers who are more interested in the productivity than maybe the price of the equipment they are buying. And in the construction segment, you have a very different set of customers you're meeting. Most of the business is done through distributors. It's very standardized products, and the margins or prices are much lower, so the need to have a lean, cost-effective standardized supply chain is much higher in the construction area than. And it's really a prerequisite for succeeding in the construction area compared to the mining area.
And again, one leading word for me is focus here, and I think, when it comes to construction, which I think also should, will benefit mining, having these organizations separated and clear about the markets they are serving, and building supply chains which are suitable to supply these markets, gives them a much better opportunity to succeed going forward. And also the focus in SMT, I think, is one clear change from the past here or from recent years. Okay, I hope that answers your questions.
That's, that's very helpful. Thank you.
Our next question comes from Mr. Roddy Bridge from Evolution Securities. Please go ahead.
Yes, good afternoon, gentlemen. I was just wondering if you could fill us in a little bit more about what is a satisfactory and what isn't a satisfactory return on capital. I think we can see that mining and machining are making-
... in your view, a satisfactory return, would it be the same sort of return on capital for all the other three businesses? And secondly, the creation of Venture, Sandvik Venture, seems to be sort of undoing a lot of acquisitions that were made in previous years. Are you taking the view that there are no synergies between some of these other sort of cutting areas and machining solutions today? And that these are therefore businesses that will need to be reviewed over the longer term, unless you can build them.
But profit level, we, I don't have any specific, numbers to give you in terms of, exactly where we feel the businesses, should be. I would still say, my requirement is not that, all businesses get up to machining sol- or ma- machining solutions, level of, profitability to be acceptable in, in the Sandvik Group. I mean, they have a very, very, high profitability, so the bar is, is set, lower than of the machining solutions level anyway. When it comes to Venture, I mean, we still have a lot of synergies. So Wolfram Bergbau is extremely strategic asset for, for the Sandvik Group. It is serving, several of our, our business areas with, tungsten, carbide, and it is a key resource in the group.
But again, keeping this clear focus on the management, on the businesses they are serving, we have felt, and I felt, that it's better to keep this in a separate business area here. Continue to be focusing, of course, on the synergies, but not that for example, the Machining Solutions people spend their focus on mining activities and recycling activities and production of tungsten carbide, but instead it's, they should be focusing on developing the insert business. So it's again, I think, more an issue of focus than questioning the businesses here. But of course, if some of these areas have more limited synergies, and if they are not delivering financial returns, we will question them.
And I, I think we've made that very clear with the, with the MedTech business here. But this is definitely not the sell list. And I, I also see this business area as a great, opportunity or, or a great location for us if we are exploring, future development areas that don't fit clearly into the, the business, of, of our four core business areas, so.
Thank you.
Thank you.
Our next question comes from Mr. Peder Frölén from Handelsbanken. Please go ahead.
Yes, good afternoon. This is Peder Frölén. First of all, a question on machining solutions. Obviously, there's a lot of questions on the restructuring need in the others, but could you please shed some light of the growth opportunities that you feel with your experience in the group now has not been fully exploited? That's the first question. The other question is really to Ola, just a clarification on the writedown, how it's hitting EBIT and cash flow, and also the booked value of the MedTech business that relates to the writedown.
Okay, first, the growth in Machining Solutions, I think there are two aspects. One, we have an enormous potential in emerging markets, for example, to grow our business there going forward and in many geographic locations. And I would like to also be clear that we chose the name Machining Solutions because another type of growth that we think that is possible in that area is looking at adjacent businesses. We probably have one of the best machining knowledges in the world in our company, and we're present more or less in every at least Western world workshop that exists. And we will also see if we can explore further opportunities based on that knowledge and that presence to develop business around that business area.
Mm-hmm.
Ola?
Yeah, and as to the writedown on MedTech, that's basically an estimation of the need of a writedown, and we are writing down all of the goodwill that we have related to that business. So that's the SEK 1.2 billion that we have communicated today.
Yeah, and what's the-
It's no cash flow if including that, it's a writedown of the-
Yeah, so it's only a bit charged in SMT, basically?
Exactly.
What's the rest of the assets? What's the value of the assets, excluded goodwill, if we assume that that has already been written off?
We don't specify the remaining asset values of the businesses that we do have. This is a write-down of the goodwill related to that business.
Okay. On that note, I mean, obviously, you mentioned that there might be some further restructuring or writedowns in the SMT and also in the construction business. But how come you're only beginning with just the domestic business? Is that basically a function of the time need and the lowest hanging fruit, or how should we look upon that?
No, that's related to that we have taken a decision to divest MedTech, and, and-
Yeah
Therefore, we saw the need to do that writedown for the other businesses. We are now doing the plans or the businesses are doing the plans during the autumn.
Yeah.
And that might reveal the other needs for some restructuring, but that we have to come back to.
That's very clear. Thank you.
Thank you.
Our next question comes from Mr. Christian Petersen from Danske Markets. Please go ahead.
Hi there. Just one question. From the credit side, my main concern is that you could potentially end up divesting significant business areas. Can you provide any comments on how you in that case will use the cash from these divestments? Would you increase dividends, or could you bring down debt? I know this is a bit of a speculative point of view, but this is a key main what you would call tail risk from the credit perspective. Thanks.
Well, I mean, as said, this is a medium-term consideration we have regarding these divestments. So I cannot speculate in how our balance sheet will look at that time or credit situation or how those proceeds, if we potentially would do such divestiture would be used. It's, I think, a premature question.
Okay, fair enough. Thanks.
Yeah.
I remind you that if you want to ask a question to the speakers, please press zero one on your telephone keypad. We have a question from Mr. Mats Liss from Swedbank. Please go ahead.
Yeah, hi, Mats Liss, Swedbank. Just a couple of short ones. First, well, you moved from 3 to 5 businesses, and that's more like how you present the case externally, I guess. And maybe it's an easy one to... This, the difference how you present it internally, is the—where are the largest changes coming in this change of the number of business areas?
Yeah. We're not presenting the changes. I mean, it's the same five business areas and the same challenges, and the external communication and internal regarding that are the same, so.
Yeah. Maybe I could come back with that a bit later. But then MedTech, the timeframe there, when, when could we expect the, the, the investment to be finalized?
We want to close that as quickly as possible, so we're gonna put in our full efforts to start the process immediately here, so.
Mm.
I cannot give you an exact point in time, but in the near term.
But your negotiations are going on, so to speak?
We're not at that point yet, but we are focusing on trying to, of course, finalize this. And now we've made a public statement about it. Of course, that's a priority in the company.
Yeah. And finally, you have the holding on Seco Tools there. Where do you sort of have that? Is it within Venture, or is it on a group level?
Seco Tools is a publicly traded company. It has a board with a couple of representatives from the Sandvik Group, but it is not operated as an integral part of the Sandvik Group.
While the holding is on the group level above the five business areas?
Uh, yeah-
It is
... you could say that. Yes, it is.
We have certain cooperation with Seco Tools, and I mean, from a competition authorities point of view, we are as one unit in the market, but we still have a very large minority in that company of publicly traded shares, and therefore, we need to treat them with an arm's length approach.
And Mats, as before, Seco is not included in any of the business areas, but reported in the group.
Yeah. So it's about the-
Yeah
... the same story as before.
The same story.
Yeah.
No change there, Mats.
Okay. Okay, great. Thank you.
Our next question comes from Mr. Sebastian Ubert from Société Générale.
Good afternoon to all. Two questions, if I may. The first one, a very good question on Sandvik Construction. Could you tell us the revenue level and EBIT margin the division made in 2008, pre the crisis? And the second question would be, could you give us a breakdown of Sandvik Venture, the different businesses you mentioned? We know that MedTech is already 650 SEK, but could you give us some color on the size of the other businesses? Thanks.
First, Construction, we will have the performances for three years back, which we will produce no later than Q1 report.
Yeah, the Q1 report.
Or year-round. So, that will be provided in detail here, but we only have these initial pro forma figures at this point in time. Venture, well, we're presenting and reporting these five segments in the company, and we don't report the sub-detail on the exact profitability levels of the parts within that.
Yeah, just as a follow-up, I mean, on Wolfram. Wolfram was quite a profitable business and was a good contributor to the tooling division. If we try to assume that Wolfram is around 50% of Sandvik Venture EBIT today?
I don't have any further comments on the details of that.
Okay, thank you.
Our next question comes from Monsieur Johan Eliason from Cheuvreux. Please go ahead.
Yeah, hi, this is Johan at Cheuvreux. I just have a question regarding SMT. Obviously, the previous management has been trying to improve the profitability and the returns for this business for the last decade with on-and-off successes, if you put it like that. But now you say you give it another 2-3 years, and the key issue seems to be a more management focus. But do you actually have some sort of hard reference on a business like this, that it's being run at a better profitability or an internal parts of the business that are running at much better profitability than what we've seen over the last decade?
I mean, is the main conclusion for us is to expect it to be divested in 2-3 years?
Your main conclusion is that we believe that there is a potential to significantly improve Sandvik Materials Technology from the level we are at today. And I would like to stress it's not no small change in terms of our requirements and expected development of SMT for the future that I'm expecting. And as I said earlier, I mean, all successful companies I, I've seen anyway, are clearly focused. It's often when you venture into all kinds of side businesses that you lose your track and often risk losing your the focus on the core business and your profitability.
So by narrowing this down to the core businesses that all tied into the hot end there, and setting the agenda against improving this core part of SMT, I think we have a very good chance of success. For example, Tube is more than half of the SMT business, and we should have our management focusing on developing these core issues. And as you as investors know, we had significant production problems earlier this year in the Tubular operations, and also had some health and safety issues on the Sandviken site. And I think in part these challenges have been caused by a lack of management focus on these core areas.
So I think by bringing that back, we have a great opportunity to improve there. And at our Capital Markets Day, Jonas Gustavsson will make a more detailed presentation about his plans for developing SMT forward. And I hope he can then, or he will then, shed some more light on his plans, so get a chance to ask him questions directly.
Okay. Thank you, and good luck.
Thank you.
You're welcome.
A reminder to press zero-one on your telephone keypad if you want to ask a question. There are no further questions on the telephone. Speakers, please go ahead.
Okay. Thank you very much for calling in, everybody, and we appreciate all your questions. I think they were very good ones, and probably we will see a lot of you at our Capital Markets Day at the fourteenth of September, where we get the chance to answer more questions regarding our future direction of Sandvik. And so, Jan, do you want to make the final comment?
I think that's a good ending. Thanks all for calling in, and we thereby close this conference call.
Thank you very much, all of you.