Welcome to Sectra's financial report presentation. We're the CEO, Torbjörn Kronander, and Jessica Holmquist, CFO since May. Online, we also have Fredrik Gustavsson, CTO, Imaging IT Solutions, for a special focus session. My name is Helena Pettersson, Investor Relations Officer, and I will be the moderator of the Q&A session later. The chat function, where you can ask question, is open from start, and you are welcome to write questions during the presentation. Management will handle them after all three presentations today, or four presentations, actually. With that, I hand over to you, Torbjörn.
All right. Thank you very much, and welcome to our year-end report. We will start with the intro and the Q4 highlights by me, and then Jessica will take over the financial developments. We'll have a special session on our new ways of reporting in the cloud software, where we complement and change a little bit how we report as we are moving on to SaaS, software as a service. Then I'll talk a little about our way forward, and then we'll go into the Q&A session after that. First, we'll begin with the value we create for customers. Sectra has business in Imaging IT, which is mainly diagnostics based on imaging. That is our by far leading area, and the one where we're most international.
We have Secure Communications or advanced encryption systems, including also cybersecurity for critical infrastructure in Secure Communications. We have Business Innovation, which is our greenhouse for new products that doesn't really fit in any one of the big ones. Q4 highlights. We have the ninth consecutive year we have the happiest customers in the U.S., large hospitals, small hospitals in Canada and Asia, Oceania. This is important. It was even more important we grew in the beginning. Now, we're well-known, but it's still a very important thing for us. We believe very much in that business comes from happy customers in the old-fashioned way. We also think that a satisfied customer is the best way to grow. We have proven that, I think, by increasing net sales for the year by almost 20%.
We have increased our profit per share to 1.63 SEK per share, and we have increased the recurring revenue by 11%, almost 12%, up to SEK 1 billion in recurring revenue. Of course, that gives a very secure situation going forward. The financial targets for the group are three. First, we have the hygiene factor that of equity to assets ratio. Our customers are very dependent on our solutions. If our solutions stop, both in security and in hospitals, huge consequences will follow. They want us to be around for a long time, and therefore, we must be financially quite conservative. Our target for equity assets is about 30%, and we are currently way above that at almost 50%, 49.3%. Then profitability operating margin.
We have been sometimes criticized for having too small target of 15%, but the 15% is, again, more hygiene factor. We are aiming to include increased growth of profits. Growth is more important than profitability. We see profitability and margin as a hygiene factor as well. We need to do good business, but if we get anything above 15%, we should invest that in growth of profits. We have no lack of good ideas in possibilities to grow, and therefore, we should be above 15%. It has decreased, but that is by intention. We both need to travel more when now, the pandemic is over, and we need to invest in future developments. Then we have the main goal. When the other hygiene factors are fulfilled, we aim to grow.
We have growth in EBIT per share as a growth target, and that should grow over five years more than 50%, and we are well above that at 93%+. All the financial targets are fulfilled. Our order bookings in Q4 surpassed SEK 1 billion. The variation between different quarters is large. This, of course, shows that after now the pandemic is over, we have huge demand again and for our products and offerings. Combine that with high volumes and long contracts, the order value becomes very large. It's both for high volume per year, but it's also very long contracts that we are awarded. One example is the recent order from Copenhagen region in Denmark, which is over a long period and with a high volume, totally almost SEK 1 billion.
We have substantial quarterly variations, as individual orders can be so large, that varies a lot between different quarters. Both ups and downs between quarters should not be evaluated too high. Specific uncertainties over the last year has been, of course, the invasion of Ukraine and COVID-19. Because none was material for Sectra in the quarter or the year, we think that the invasion of Ukraine, despite being a horrible situation, will lead to increasing demand for especially our cybersecurity products, but I'll come back to that a little bit later. Secure Communications Q4 highlights. We got orders from the Swedish Armed Forces and Dutch Ministry of Defence. This has been an area we have had problems during the COVID. We have not been able to ship.
It has also been very difficult to sell as these are at a level where selling over Teams and over telecommunication media is not possible. We have to go there in person, and if you cannot travel, you cannot sell. The pandemic is gradually behind us, and that means that the improvement after the pandemic is clearly in sight now. We also have appointed a new president, Magnus Skogberg, who comes from Saab. He will take over the position as president of our Secure Communications business from August first, 2022. The impact of the Ukraine crisis on communications, we see an increase in demand for cybersecurity overall. Increasing effect of crises and wars today is that people attack cybersecurity and critical infrastructure.
We've seen that in Ukraine before, we see it now, and that means also that other countries need to protect themselves on these cybersecurity threats. We also see an increasing need for secure communication encryption products. One huge failure of the Russian army in Ukraine was that they need to go over to speaking over open line between cell phones between the Russian units, and that of course was eavesdropped upon by the Ukrainian forces. This has led to an increased understanding that encryption in crisis management is critical. We've already seen an improved demand for our products based on this. Business Innovation, Q4 highlight. That's our greenhouse. Focus on these both of these two areas both orthopedics and education is an increasing usage and recurring revenue. We're on a good trend there.
We see a strong increase in recurring revenue in these two business units. We also must understand that both were severely affected by the pandemic, and the results vary significantly between quarters, as these are very small business units. We see promising signs in both of them post-pandemic. The growth initiatives is in orthopedics, implant movement analysis. The primary operation when you actually put in an implant into people is quite industrialized, quite effective today. We have good planning software for that. A revision, when you need to re-remove a prosthesis, insert a new one, that's both very dangerous and very complex operation. You want to minimize those, and we have new tools for minimizing the need for doing this unnecessarily.
That is having a huge interest all over the world, but it's in early phase, so we need more clinical trials for it. Very much related to that is computer tomography micro motion analysis. More or less the same technology. We analyze if a prosthesis is stuck to the body or if it's loose. In the implant movement analysis, it's one individual patient that comes in. You want to see if the patient is stuck or needs to be revised. In the other example, the CTMA, it is analysis between different times. In your patient over six or three months, you see if a prosthesis is moving or not. That is needed for clinical research and approval of the large prosthesis company's products.
We have a very interesting tool for them in doing that without actually extra insertion of markers and stuff in the body as before. In medical education, we have a large transition from the tables we sold in the old days. We sold these huge, like iPhones, but huge, like table-sized. We are moving that into recurring revenue by selling a subscription to content. We have a very large database of different examples of disease and pathologies. This, you can get the table, and but you can also do from a normal laptop or from a pad even. You can subscribe to this database and teach based on that. We see a rapidly increasing demand for this in our user base in education.
We also have a research unit in Business Innovation that focus on AI for medical applications and other future areas within diagnostics. Imaging IT Solutions were our largest unit by far in Q4. We got the French framework agreement for digital pathology. This is important. We have not been large in France. We are very small in radiology, for instance, but we are strong in pathology. This is a French almost national framework for providing digital pathology, and we came out on top on that for France, which is a rapidly growing market for us, especially in pathology. We see that now that the new model Sectra One software service is the most of the new contracts we're signing up on that is on the new subscription model.
Of course, it has no major impact yet, but it will increase rapidly, as Fredrik will tell you a little later. We are in the middle of transitioning to SaaS and cloud deliveries, as I said, before. Coupled to the Sectra One software as a service model is, of course, that we normally deliver that over the cloud instead of having an on-prem solution on computers. This is a huge change for us, and Fredrik will have a special dive in on what happens around it. Growth initiatives, we see new markets, direct and indirect. We're in the expanding indirect sales region to South America with a new dealer or distributor in South America. We are doing more and more enterprise imaging. In the old days, we did mainly radiology imaging.
Now we are growing into all the images in the entire hospital, in Pixel EMR. We have digital pathology that is in a very good growth trajectory, and that is combined with radiology, it becomes integrated diagnostics, and that is important for cancer research and cancer treatment. We have cardiology, and we have ophthalmology, which is a new area developed together with a large U.S. customer. Ophthalmology is images of the eye, which is also now three-dimensional and a complex pathology. We are focused on the U.S. This is the world's largest IT market with top customer satisfaction, and we still have a small but growing market share in the U.S., and that leads a good trajectory for growth opportunities. We are in many countries so large that we have difficulty to grow.
You cannot grow beyond 100%. Even if you're above 50%, the growth become increasingly difficult. In the U.S., we are clearly below 10% market share, but we're growing rapidly. I will leave the word to Jessica will tell you about the financial development of Sectra.
Thank you, Torbjörn, and good morning to everyone. Let's start off by looking at our long-term financial trend. We've been on a growth journey since early 1990s, and we've only seen sales declining three times during this period, the last time being during the pandemic. As you can see, we are now back again on the right path with substantial growth in net sales for this past year. Order intake amounted to SEK 2.3 billion, down 12.5% versus last year, but still according to our expectations. We saw a strong ending to the financial year with order intake exceeding SEK 1 billion in the fourth quarter, coming from a mix of current and new customers.
As mentioned before, order intake is a volatile number from quarter to quarter, which has clearly been the case also for this past year. Sales continued to grow in the fourth quarter, and we had a total growth of 19.4%. We had a tailwind effect of 2.5 percentage points for the full year. We had the effect especially during the second half of the financial year. Looking at the fourth quarter isolated, we had total growth above 23%, with a tailwind effect of 5.7 percentage points.
Also, worth mentioning, of course, recurring revenue is growing, and we increased recurring revenue by nearly 12% in the past year, now totaling 55% of total revenues. Moving on to sales by geographic market. In absolute terms, nearly half of the sales growth was generated in the U.K. in the past year. We also had good growth in the U.S. as well as in rest of Europe, where Norway accounts for the highest growth in absolute terms. Other markets contributing to growth was in the past year in Europe was Germany, France and Belgium. Declining sales in Sweden is due to the impact from Secure Communications. Imaging IT is still growing in the Swedish market. We have sales by segment.
Most growth is generated in Imaging IT. They increased sales by close to 24% in the past year. Imaging IT delivered large customer projects and signed important new contracts, as well as strengthened the position in key markets. Looking at Secure Communications, they have been struggling in the past year with the effects from the pandemic, as mentioned before, and we saw sales declining by SEK 23 million, corresponding to 11%. We saw, however, in the fourth quarter an uplift versus the comparative period last year, as previously delayed deliveries could actually take place. Looking at Business Innovation, our relatively small businesses in this segment, they have had a strong year coming back from very low volumes during the pandemic.
Other operations include our group functions. The change in sales is primarily explained by increased central management costs being flowed down to our business segments. Moving on to operating profit. Operating profit of SEK 383 million for the full year, corresponding to an increase of 9.5%, 4.8% adjusted for currency impact. The operating profit margin declined slightly from 21.4%- 19.7%, as a result of product mix and also of course higher expenses as we return to more normal expense level with higher costs for travel and sales and so on.
On a segment level, we can see that again, most of the operating profit is generated in the Imaging IT area. Imaging IT grew operating profit by 10% to SEK 416 million for the year with a strong fourth quarter. We can also see that the margin for Imaging IT was pushed back a little versus previous year due to higher share of hardware sales, especially in Q4, and also the higher expense level mentioned before. Secure Communications have continued to struggle with the pandemic effects but improved in the fourth quarter, both in terms of customer deliveries and also customer interactions. They showed black numbers again in the fourth quarter.
We also see positive signals on the order intake side for communications. We have Business Innovation that managed to grow top line by 19% as to deliver a 9% margin. Last slide for me is on cash flow. Here we see that stable underlying profit growth contribute to cash generation during the year. Along with the large advance customer payments received, especially in the fourth quarter, we had a very strong cash flow for the year, and especially in Q4. This is rather a one-time effect with the advanced customer payments. It's not something that we expect to be repeated in the coming quarters. Investments were more or less on the same level as last year.
By that, I hand over to next presenter.
We will give the word to Fredrik Gustavsson.
All right. Thank you, Torbjörn. Thank you, Jessica. Good morning, everybody. As Torbjörn mentioned in the beginning, we'll share a bit of details on what external reporting in this world that we're in, where we're seeing a huge increase in the amount of software as a service and cloud opportunities. Before we do that, I'd like to share a bit of an update about Sectra One. As you know, we started working with Sectra One some two and half years ago. We set out on the mission to simplify for our customers, existing and new customers, to benefit even more from our solutions.
Especially as we're growing with new modules and support for new diagnostic specialties, as Torbjörn mentioned, ophthalmology being the latest one, but also through digital pathology as another example, we wanna make sure it's easy for customers to adopt this innovation and to be able to benefit and deliver great patient care. We created Sectra One, which is our unified business model. It's a subscription that includes maintenance, support, and the underlying software components in one easy to buy and easy to sell subscription. We're happy to say that it's been a great success. Customers have really appreciated this new way of getting access and buying Sectra Solutions. Majority of our new opportunities and new deals that we're making are based on Sectra One and Sectra One Cloud.
We are very excited about this, and it really shows that this is the way of the future. This is the way customers prefer to buy our products and services. That's been a great success. One of the reasons for this is really the way that we've been able to reduce complexity, and that's what we've set out to do. That's been red thread throughout everything we've done in terms of everything from product packaging to pricing to the way that we help customers implement our solutions, to reduce complexity, make it easy, and sort of be able to scale and grow efficiently. We've gone from about 100 and hundreds of products, and our product portfolios were huge. We're down to four different subscription tiers. It's a huge reduction on complexity.
It makes it easier for customers to select products and tiers and make sure that it's right size for them. One of the, I think, major things customers love with Sectra One is that they are not only sort of buying the software today, but they're getting this steady stream of innovation. As the customers tells us that that future-proofness is really desirable, and they love that. They know that they will be able to benefit from new features, new modules that we develop, and we're taking down the friction of getting that innovation into the healthcare systems. Another thing that they also like is that with Sectra One, being able to then operationalize that cost, they can better match their revenues and values generated on their side with the cost of a subscription.
Historically, they paid for maybe upfront licenses, and maybe they've been paying to other vendors expensive upgrades. Now with the Sectra One model and in moving to cloud and software-as-a-service deliveries, it is actually better fitted to the customer's business model. We are more aligned with the value generation that they do. Now cloud, this is the big thing. This is the big trends right now. The beauty is really when we then combine Sectra One with cloud capabilities, cloud-native technologies, and build that on top of either our own private cloud or public cloud technologies such as market-leading Microsoft Azure. We're providing customers with the easy-to-understand, very transparent way of accessing this technology and diagnostic solutions. As compared to many of our competitors, we feel that we're very transparent.
It's easy to understand our business model, and there are no hidden costs. Customers do appreciate this. It is predictable. They understand what they're buying, and they understand what they're gaining, and they understand what they're gonna be paying for. This is a huge interest in this area right now and just keeps growing. That's why we're focusing today about what are the consequences then from an external reporting perspective. I'd like to share first an example, fictive example, where we're looking at a case where we're looking at about SEK 500 million deal, for software and maintenance, so pretty traditional setup. We're looking at the consequences in Sectra's external reporting in the first case in an on-prem situation and then the second case, as you can see, in cloud.
From an IFRS 15 perspective, in the first case where we're looking at on-prem, we will recognize the standalone software component that is delivered and as a performance obligation been made available for the customer to benefit the economical benefits from. That means that we get this first initial sort of spike in the revenue curve, as you can see, amounting to about SEK 200 million in the first year. Then through the consecutive years, over the consecutive nine years, there is just this support and maintenance component that's delivered over time. In a cloud environment, due to the fact and from a revenue recognition, again, IFRS 15 principles, the software and the underlying integrated hosting becomes an integrated performance obligation, meaning that the full revenue is recognized on a per year basis.
You can see the difference here is that we're not getting this upfront spike in the revenue recognition. It's spread out over the period instead. I'll repeat that. In an on-prem environment, we have this upfront recognition of the standalone software components that are handed over to the customer, control is handed over, and the customer can benefit. In a cloud environment, we are, by necessity, we have to deliver that as a service continuously over time, and thus we cannot say that performance obligation is fulfilled, and thus revenue is recognized over time, meaning that we're getting more revenue per year in cloud, but we have the reduction of that upfront effect. Cloud is growing, and it's increasing quickly. It's not just with Sectra.
I'm participating in a panel conversation next week in the U.S. where we and other industry leaders are essentially saying this is happening now. Cloud is for sure very, very much on the top of everybody's mind and almost in all opportunities that we face, customers are requesting. "So what about Cloud? What does that look like?" This means that revenues will be recognized over time increasingly as this transformation to cloud happens. Another thing which sort of impacts the way that we're going to present things to you in the market is that also contracts differ. Customers historically buying a traditional one-off license contracted in a certain way with us. Now customers buying software as a service, they are expecting other contract terms. We're delivering a service over time, so the contract reflects the nature of that business relationship.
Hence, contracts look different. This has an impact on order intake. We'll sort of go through that in just a bit. With these changes, the move to cloud, the spreading and increasing of recurring revenue over time, and the fact that contracts are changing, we've decided to do the following things starting from Q1 this year. We will increase details on order intake during a transition period. We will then stop reporting order intake after two years from now. The reasoning is that since we're moving to software as a service and cloud, the meaningfulness of having order intake is diminishing. Throughout this transition, we're providing you with even more details. That's just to make sure that you have a good transparency whilst we're moving the sort of, you know, the business towards SaaS and Cloud.
We will be focusing on recurring revenue. We've heard already from Torbjörn and Jessica. Nice, I think really great improvements in recurring revenue that we're seeing and this foundation for our business. As a new specific alternative performance measurement, we will start also showing you what's called Cloud Recurring Revenue that represents how much of recurring revenue is based on our Cloud business. I'll come back to the definitions on what that looks like. First, we said that we're going to provide you with details on order intake. This is the way we're going to report order intake and give you the insights into the way that our business is growing. First and foremost, we are using a contracted order intake. That is the value of products and services that the customer has procured and intends to purchase for the full contract period.
As you might have seen, Torbjörn mentioned Copenhagen as an example here, close to SEK 1 billion. Now, as a consequence of the changing contract nature, as I mentioned in SaaS and cloud business, we also feel that it's necessary to provide you with a bit of additional details. As a consequence of these contractual changes, we've now also split out what's called the guaranteed order intake. This is the customer committed purchase at the contract signature. I'll repeat this. We have the contracted order intake, which is everything the customer has procured and intend to purchase for the contract period. We have guaranteed order intake, which is what the customer has really strictly committed to purchase at contract signature.
Again, the reasoning behind this is that we have a new set of expectations on contract structures impacting the way that we're sharing this information with you all. As a final level, we're also going to present out of that guaranteed order intake that we've just mentioned, what has already been recognized during the reporting period in question and what is estimated to be recognized as revenue within 12 months from the reporting point in time. That's an update on the way that we look at order intake and some of the effects that we're seeing as we're transitioning to cloud and SaaS business models. Now, what about revenue recognition then? Revenue, classical total revenue, nothing to really point out there, as we did mention, and we're focusing even more on recurring revenue.
As this is keeping, we're keeping growing that continuously by having more customers join and sort of subscribe to our business as cloud and SaaS business. Recurring revenue is the Total Recurring Revenue. We'll go into the definitions in a bit more detail on the next slide. This is just to show the sort of overarching structure. We have Cloud Recurring Revenue. That's a subset. Total revenue, recurring revenue, and out of recurring revenue, a certain subset is Cloud Recurring Revenue. Now, recurring revenues are revenues that we expect with a very high certainty to recur for at least 12 months from the reporting day. It is also revenue from customers that are unable to continue benefiting from the services or the full functionality of the service and the products without recurring payments.
These, in this context, it means that it is recognized under again IFRS 15 as revenue over time and that sort of falls within our recurring revenue reporting. As examples of what's included is typically maintenance contracts or service contracts. It's Sectra One Cloud and other Cloud services. As Torbjörn mentioned, we have the Education Portal and other cloud services, for example, within communications as well. What's not a part of recurring revenue is one-time upfront licenses. Professional services typically related to a deployment project where we're selling hundreds of thousands of hours to help customers onboard the solution and help them with training. There are some cases when hours are a part of recurring revenue. We'll mention that a bit again later. But typically, professional services and the bulk of our sort of sales of hours are not recurring. Hardware is typically neither recurring.
That's a one-off sale. All right. Cloud Recurring Revenue then. There is really not something strange about that. As I'd mentioned, it is recurring revenue that's related to Cloud business, but I'd still like to share a bit of details about that to make sure we're clear on what we're bringing into that APM. It is recurring revenue earned from Sectra Cloud services, and that can be private or public cloud. That's the infrastructure basis for those services. Sectra One Cloud, Sectra Amplifier, Sectra Education Portal all falls within that categorization. The revenue that we're taking in here includes software, as I mentioned earlier, infrastructure, operations, and hours needed to provide that service to the customers.
If you look at what's not included, we're excluding professional services hours, again, related to deployment projects, any on-premise installations or single environment customer hosting contracts. We're only bringing in customer contracts that are true Cloud. If there is a managed service contract that's related to just one customer, it's not considered a cloud environment. The reasoning is that in the cloud environment, we have economics of scale. We are able to deliver another level of service, and hence that's where we're seeing growth, and that's what we wanna show as a part of this APM. Yes.
Whatever other effects may we see as we're transitioning to cloud and software as a service, if we look then at the balance sheet, and in most of these cases we're looking at public cloud, that is where we're heading, that's where we're seeing the market is heading, and then the effect is really not significant. The costs are basically expensed as they are incurred with the contracts. We're not buying servers, we're not buying storage, we're buying that on tap from our public cloud vendors, which is a very nice way for us to grow and scale. Similarly on the cash flow side, we do get invoices and pay the cost for the underlying infrastructure on a monthly basis based on our consumption and
We're also getting customer payments, and that's really a mix between quarterly upfront, in advance, and monthly on consumption for different pieces in the service that we're providing, for example, storage. If you look at profits and making sure that we're clear on the context, everything else is equal, profits will improve, and we will see huge economies of scale and efficiency gains. I think a good way to think about this is today we're having about 2,000 systems installed out on customer premises, and there is so many servers. There's so much work going into maintaining that that will be possible to automate. We will be able to share resources. We will be able to automate the management upgrades. Moving to cloud software as a service has a huge potential for profit improvements over time.
To sum that up, we're really seeing a huge interest in the market, and we're excited for the success of Sectra One and Sectra One Cloud. We have decided to make sure that we're changing a bit on our external reporting to make sure that you get the right information during this transition. We're giving you more details on order intake. Again, repeat order intake will go away as a part of the reports from two years from now. We're focusing on recurring revenue, and cloud recurring revenue is a good way to track the growth and success of Sectra's business in the cloud space moving forward. Thank you so much, and I'll hand over to Torbjörn.
I will discuss a little about our way forward as a roundup for this presentation. Our focus forward will again be high customer satisfaction. In order to get high customer satisfaction, you have to have happy employees and a good culture. It's impossible to create high customer satisfaction by not treating employees well and as the very important contributors they are, because it's the people close to the customers who provide the most of the value. We want to continue to grow, but we want to grow profitably. We will have the 15% margin as a lower bound for what we think is profitable, and we will invest in growth.
We intend to continue to be to skate to where the puck is going to be, and I'll come back to the definition of that in a short while. First, this is a quote. We like quotes at Sectra. This is a quote I come back to very often. W. Edwards Deming was a consultant who was consulted by the Japanese government after the war who kind of moved Japan from cheap stuff that was poor quality to very good quality and a little more expensive. Profit in business comes from repeat customers that boast about your product or service and bring friends with them, and especially that a new deal is very expensive.
Sectra One will help with that because when you get a customer one order you, one type of images, it's very easy to extend that to the other types without have to actually doing a new procurement. It will also simplify the transition on increasing the business with a happy customer because they can do more types of images in it. Pursue some of your markets. In order to be profitable, you need to know where you are and what markets you're in. Growth is much easier in a growing market. Let's discuss medical a little bit, where we are. Costs for healthcare are increasing all over the world. This is percent of GDP. Of course, look at the U.S. today, it's close to 18% of GDP in spending for healthcare. This cannot continue forever.
You cannot have 100% of GDP going to healthcare. While U.S. is higher than the rest of the world, the derivative of all countries is more or less very concerning. Healthcare must change, otherwise it will be very difficult to sustain the level of healthcare we have learned to expect when we grow older, especially. Breaking this down, what drives the cost explosion in healthcare? You take down the cost per capita per age bracket. You can see that the big explosion is after the age of 60. More so in the U.S., but it's very large in all countries. If we're gonna handle and take care of the cost explosion in healthcare, we need to address the disease of the elderly.
The disease of the elderly is neurodegenerative disease, Alzheimer's, Parkinson's, MS, et cetera, other dementias, very expensive, means a long time in hospice or elderly care. We have cardiovascular disease, chronic heart failure is very expensive, very long, lasting disease. Cancer disease, oncological diseases are increasing. Musculoskeletal disease, underestimated, cost actually. It's a very expensive, thing and growing rapidly where we become spare part of humans more or less at higher age. Get your new hip is kind of an ordinary procedure today. We can replace most of the joints in the body. You need tools for that. Vision and hearing is something we've added, well, we added ophthalmology because we now handle ophthalmology as well.
We do business in all these three, and we do medical imaging for all of these five areas. We are specializing this. We should do medical imaging for all healthcare of course, but we should be very good in these areas. When you see a blue rectangle, that means that we do the basic imaging, but we partner for the special clinical applications in that area. When it's green, we do everything in-house. Now I'm very proud that we are the only company in the world that does pathology radiologically in the same system, which is cancer research, especially cancer. We also have orthopedics and general imaging in the same company. Again, we are alone in doing all of that in-house at the company doing the imaging.
In vision, with the addition of ophthalmology to our offerings, we've added into this new area as well. What drives cybersecurity? Well, of course, this is a very difficult time. This is a picture from the horrible situation in Ukraine. There were people living in that building. We have a concern about war all of a sudden in Europe that we have not seen in very many years. We also see plain financial attacks on cybersecurity. We see that this is the Colonial Pipeline network that was attacked by ransomware. It provides about, I think, 100 million gal of fuel every day. It more or less was very close to bringing the entire east part of the United States to grinding halt a year ago. This was a cyberattack as well.
Cyberattacks are increasing, and the war is increasing the need of encrypted communications. We also see an increasing synergies as ransomware attacks. Before, they were equally distributed over all industries, but most industries will not pay a ransomware if they can avoid it. They will take a higher cost avoiding paying the ransomware because you teach the criminals they can make money in that way. However, if you get ransomware attacks into hospitals, there is not the financial consequences. If you get ransomware in the ICU, patients die. That, of course, unfortunately, the crooks have learned. Which means that increasing synergies because healthcare is becoming a prime target for advanced cybercrime. This is so concerning graph of the ransomware attacks per organization by industry in May 2021.
You see that the attacks on healthcare is way more than any other industry today. We have increasing synergies. We have a lot of course, reputational synergy between our organizations. We also have usage of knowledge from the cybersecurity area in the medical industry. We should also remember, we have built a very fragile society together without a plan. It's very similar to building a skyscraper one floor at a time. You start with one floor. Well, that worked fine. Let's build another one. All of a sudden, you're floor 26, and you build 27 because the 26th first floor worked. There's no plan, there's no structural dimensioning on this. We just keep on building. This is actually what we're doing with IT society. This is dangerous.
It needs to be addressed because one day that colossal skyscraper will come down, unless you keep trying to patch it or at least begin to plan it. Both against criminals, but also against national actors and terrorists, we need cybersecurity, and the market is increasing rapidly to cope with the situation we have created. Sectra is well positioned in two markets, where profitable growth is easy in growth markets, as said before, but it's also ideally a market that is forced to grow by external factors. This is not a matter of fashion or availability. Healthcare has to address its cost factors. It cannot continue, and it's gotta be done by investing in things that make healthcare more effective, which is IT to a very large extent.
Cybersecurity is in a trajectory where there will be increasing investment in that area because of that, the problems will increase. Healthcare and cybersecurity are such markets where they are forced to grow by the external factors, and that's where we operate as Sectra. Where others see, we see it like this: where others see a problem, we see opportunity. Our special niche in healthcare is also when healthcare must scale up and become streamlined production. We are not primarily focused to research in healthcare and or very advanced or rare diseases. We are concerned about helping healthcare to become streamlined and industrialized. It might sound cynical to call healthcare industrialized, but you could just imagine what the quality of our cars would have been without an industrialized process.
It means high quality to low cost, and that is exactly what healthcare has to go through. What we do, we do IT systems and products that serve when the healthcare becomes industrialized in that positive sense, I mentioned before. I have this saying, and we've used that for a long time. When Wayne Gretzky, the best hockey player in the world, was interviewed why he could be so good at hockey, he was not particularly good in any part of it, he said, "I do not skate to where the puck is, I skate to where the puck is going to be." We've been good at that. We saw the need for pathology way before anyone else.
We saw that was required to join that with radiology because you wanted a cancer tumor board, for instance, to be joined between both radiology and pathology. They work as a team nowadays, they need a team software that can provide both with the goods they need when they discuss things, just as one example. Examples where we are going in the future is Imaging IT systems. We see consolidation in healthcare. Hospitals are buying each other in the U.S., becoming much fewer, much larger operations. We see that in the public healthcare, so countries by merging, especially in the U.K. and Nordic countries, but also increasingly in other countries.
We see that the government who owns hospitals are merging them into larger unit to become more effective, especially for IT, and they need special IT systems. It's quite different to provide as a IT system or medical imaging system for one hospital or for 25 hospitals that work in a chain, and they need the access to the same systems. We also see enterprise medical imaging. Our previous business was mainly radiology. That is growing. The customers want more of handling of all the image data, all the unstructured data, to be more, even more wide scope. That is not structured.
The structured data resides typically in the EMR, where the non-structured data, which is measurement data, et cetera, needs to be handled in different way, and we are going towards a pixel EMR, where EMR stands for electronic medical record, which means we take care of all the pixels, all the images outside, also of radiology for the entire enterprise. We've added new ologies to be able to do that. We've done pathology, and we started that eight years ago. That is now on a nice trajectory of growth. We have added ophthalmology during the pandemic. We developed that directly with a large U.S. customer, and it was a great product because our developers was working with the physicians and the doctors directly over Teams every week.
They had a weekly meeting until the product was completed, which also shows that you can develop in very exciting and new ways, in the new world where or in this case, physicians can directly interact with our engineers without a large chain of product management and marketing in between. Other examples in cybersecurity, we see an increase with secure mobile workplaces. People during the pandemic have been working from home, and they discover they like to work from home, and they would like to continue doing that, but that's not very secure. We want very secure mobile workplaces.
Cybersecurity can be the same if you sit at home as if you sit in the office, and this is increasing the need of also approved mobile workplaces, where an approved one means that they're classified in networks and can still work on mobile. High speed, high security network infrastructures is also increasing in demand, and then, I mean, approval level of VPNs and bridges and routers, et cetera, where you can handle also military and governmental classified information in these networks. We see and expecting increasing demand due to the crisis in Europe, apart from the general increase in demand from the previous two points. In Business Innovation, our orthopedics and education and research businesses, the entire image-based orthopedic planning and follow-up process is increasing. It has to become industrialized.
It has to be done to avoid the revisions, especially the revision, the reoperations that are not needed should be avoided at all costs because they are dangerous and very, very complex. Lifelong education of medical staff is the kind of half-life of medical knowledge is becoming very short. All medical staff have to learn continuously for the rest of the years. They're becoming like us engineers now. We are also in that area of having to learn new for our entire life, and that means a portal with good content of medical education is a very strong thing to have. We also see other new medical areas that we're exploring on the threshold of becoming industrialized.
Perhaps things that you've done a little of before, but now is becoming so large and so much used that it needs to become a productified industrialized area. Industrialize in the positive sense of being high quality and good cost. In cybersecurity, we see quantum computers threatening the security of the entire internet, encryption algorithms, all the public key infrastructures, and the public key encryptions, and there will be a need for post-quantum encryption systems. Joe Biden, the President of the United States, has just announced that, in the U.S., authorities, they now require symmetric encryption, which means that is a post-quantum encryption.
They're very concerned about someone being able to build a quantum computer to break the current encryption of the internet, and we are well-positioned, and we have several products post-quantum enabled already now. Philosophy for shareholders of Sectra. If you start with a good position in growth markets, as we are, as I have described before, then if you have happy customers, happy employees needed to create the happy customers, and you have reasonable cost control and good perseverance in what you do, then shareholders will be happy. It cannot be avoided, and that's our strategy of providing shareholder value long-term, et cetera.
We also have a very strong cash position, and the board proposes to distribute 1 SEK per share through a share redemption program in the way we've done over the last years, which has some benefits compared to a normal dividend payout, but essentially it's the same thing. This is an increase of 0.1 SEK per share compared to previously. Then I'll invite you to the future interim financial reports and the annual general meeting. September 2nd, we have a three-month quarter one report of this year, and September 8, we'll have an annual general meeting. If we avoid any pandemics coming back, we'd be very happy to host this as a physical meeting again because we prefer that to only having these Teams meetings.
Annual general meeting preliminary will be physical meeting here in Linköping. With that, I thank you very much for your listening. Please remember that your feedback is very important for us. We want to have these presentations worthwhile. If you have any feedback on things that should be modified or we should discuss more or discuss less, please send an email to info.investor@sectra.com and tell us what you think. Then I open up for questions. If you follow online, please use the chat function for questions.
Yes, while you're online start writing questions, I will start with some questions from analyst Kristofer Liljeberg at Carnegie that we have received by email. The first question is, can you please explain the reason for large customer advances in Q4?
I'll take that. It's mainly due to U.K., where the NHS has invested a lot in future technologies, and these are prepayments in the U.K. mainly. It's not something that will come back every year or every quarter. It's a one-time thing.
The next question is, explain the unusually weak gross margin in Q4. That's due to the product mix, a larger share of hardware sales in Q4, impacting margins.
Again, that is a one-timer. We have some large long-term contracts where we had to renew hardware, as part of the long-term contract, and this quarter we had to do such a large such review.
Yes. How much of the decline was caused by larger sales of third-party components?
We don't publicize that, but it's a quite large part of the decline.
The third question, even if margin come down last fiscal year, it is quite a bit above the target of 15%. Will costs continue to increase more than sales in the new fiscal year?
Only if we have good things to invest in. There is no reason to waste money. But we do have some very interesting trajectories, and we have huge growth opportunities. There are many countries where we are still nonexistent or small, and with digital pathology, for instance, we've gone into new countries, both France and Korea as our examples. Going into a new country costs a lot of money. We also have new areas that we might invest in, but we will only go down towards 15% if we have some really good investment to do with the money.
Yes, I will switch to online, and there we have a question. Given transition, is it possible revenue growth turning negative in the short term? Also, shall we expect lower profit margins in the short term given less revenue recognized upfront?
We transition over a long period of time, and we do not expect negative revenue growth in the short term. There was a question on margins. Well, I think Torbjörn already answered that partly. Margins may be pushed back a little depending on our opportunities going forward.
It's important to understand that Fredrik showed we kind of flipped the high billing towards recurring revenue. The initial payment of the software license will be done over four or five years. After that, we keep the higher level of payment per year, and then of course it's a benefit towards the one-time license model. Long term, the profits will increase, but while we flip that big billing down, the revenue growth will decrease initially, but long term this will be much better than the initial license sales model. The important thing, it's better for both customers and vendor. It's a thing that has happened in most software markets around the world.
Yes, I have a final question from Kristofer Liljeberg at Carnegie connected to Fredrik Gustavsson's presentation. How much of the order intake in Q4 was guaranteed?
We do not start separating between contracted and guaranteed order intake until Q1. For Q4, we report according to old definition and I would say all of the order intake in Q4 was guaranteed.
It's the first time we actually split it up was with Copenhagen, and that came after Q1.
Yeah.
We have no further questions online.
All right, I thank you all for listening, and we hope to see you again, or not see you, but present again for you September 2nd in the fall. Goodbye, and thank you very much.