Kempower

Powering planet cool. We charge our planet for the better by powering the electric movement. We enable quick and scalable EV charging solutions for everyone and everywhere. We make it positive. We believe in the power of positive energy. We see opportunities where others see obstacles. As a team, we create success for us all and add value to people's lives. We make it quick. We like our charging experience fast and easy. We are quick to respond and quick to deliver. Our service is easy to sell and buy. We make it click. We make the most user-friendly EV chargers that become future standards. Our products just click. They are flexible to integrate and to scale. We make it happen. We empower the EV evolution and create a cleaner and more quiet environment for us all. We inspire our audiences to join the electric movement. Plug in and be the change.

Hi everybody and welcome to the webcast where we present Kempower's financial results for 2023. My name is Paula Savonen. I am the VP of communications at Kempower and also your host today. Today we have two presenters. We start with our CEO, Tomi Ristimäki, who presents the key highlights for 2023. And then after Tomi, we continue with Jukka Kainulainen, our CFO, who presents the key financials for the year. And we know that there is already plenty of people on the line. Thank you for joining and being with us today. And you have already sent us some questions, but keep the questions coming. There is this Q&A box on the screen and you can ask questions anytime during the webcast. And we take all the questions in the end of the presentations. But now I give the word to Tomi.

So yes, welcome everybody. So I would like to have the quarter four in brief. I think it's looking at the financial performance, it's a record high revenue in Kenpower history and looking at the order intake is a good level and strong cross-profit margin. This is really about also increasing the product capacity and improved sales mix when we look at our gross margins. Operative EBIT is negatively affected by increased fixed costs, which are related quite highly on our investments, which in Kempo world, it's a lot of investments are OPEX based, so we are increasing our our headcount in key positions, and we are actually investing in our future product development to actually have our growth initiatives going forward. Market trends, we see a few bottlenecks in demand. in Europe, as we saw some customers in Europe destocking and lower investment activity due to the delays in grid connection availability. This is something that is affecting how we see it. We also gave guidance to the Q1 numbers based on that. But there is still, if we look at those few bottlenecks, there's still strong growth in battery electric vehicle registrations, both in Europe and North America. and the growth trajectory is continuing in 2024 and forward. North America entry, one of our key initiatives. Production has been started and first orders have been shipped to customers. Order intake from North America is already 10% of the total order intake. And on technology-wise, I think there's a great progress. I have a summary on that in a few slides. The introduction of megawatt charging program, which is related to the long-haul truck charging that affects a lot in the future market. And after the review period, we launch our next generation charging solutions with the new technology, power semiconductor technologies referred as silicon carbides, or shortly as SIG components. Then on customer highlights, we are now delivering fast starting solutions to SD1, which is one of the largest energy companies in Northern Europe. Great launch now publicly with Sainsbury's new Smart Charge EV, Jane, Sainsbury's is top five retailer when you look at the whole Europe and one of the biggest in UK. And we do now the charging business together with them all around UK. And we have from the commercial vehicle segment, some significant projects, the Malta's first electric bus depot and with over three megawatts of charging power was delivered. And then also climbs to the future, how we see also the water transportation moving. So the partnership with Aqua Superpower and the first deliveries for both charging in the Mediterranean area is also showing the future growth markets. Then looking at North America as such, as I mentioned, it's a key initiative in Kenpower strategy. The picture itself is actually representatives of the US Congress visiting our new facility in North Carolina. And Imani actually telling how the products work in the picture. And Kemppau received the ETL certification for the production. This means the safety approvals in the US, where you need to also qualify all the production facilities. We had previously this to the Finnish factories so we could make the US deliveries, but now also North Carolina facility is certified. And first products have been shipped, as mentioned. Growing demand and trust towards Kemppau brand, and very positive sales pipeline development in the North America combined. And we are continuing our expand of production. So I mentioned growth initiatives. One of the things is actually be prepared for the growing demand from the market. We produced around 5,000 charging points in Q4, which is a really growing figure. And electricity charge through Kenpower chargers in Q4 2023 was 70,000 megawatt hours. We have now successfully ramped up production facilities in two continents, and third production facility in Lahti, so our third factory in Europe, which are now all based in Lahti, to be opened during the second half of 2024, and this project is progressing very well. Important milestones in R&D and technology. This is definitely something that relates heavily on the North American market. This NACS charging standards is something that was originally only Tesla car or Tesla developed charging standard. As we have now seen, almost all the car manufacturers have made announcements that they move into NACS charging standard for the North American market. by 2025-2024. This is different with different car manufacturers. And we will have all our charging solutions available with NACS charging standard during the Q1. Megawatt charging program from Kenpower for electric trucks. and also electric vehicles using high power. I mean, also we look at the ship industry, we look at all the large vehicles with high battery capacities and these powers go really above megawatt. And this has been launched during Q4. And then as a news from this year, the next generation fast charging platform utilizing the newest let's say commercially viable power semiconductor technology called silicon carbides has been released. And that actually the big benefits, we will not see that so much in the end users. It's more our direct customers when we look at lower power losses, thanks to the high operating frequencies of what are actually made possible by the next generation power semiconductors. And through that actually increased system efficiency in total. And looking back to our growth strategy, so what are the key points we also mentioned last year in our CMD Capital Markets Day? So looking at the growth strategy, where we are today and what we want to be. So dedicated and reliable EV charging solution partner. Ambition level is to be the top five player in Europe and North America by 2030. And when we look at the three markets, from the aspect what we are seeing here, the Europe, that we have top position in the Nordics and we are increasing market share in the rest of Europe very fast. North America, we see that the North America at this stage is very rapidly growing market and we did the entry in 2023. The rest of the world, we do have, you can see some news, things happening in the rest of the world, especially we look at the Southeast Asia, Australia. So in our strategy and in our company, this business development stage, and we are screening the key markets on where to focus. And the business is mainly done through distribution partners. But we do have people working in this market because we need to know what happens and we need to be prepared when the markets get interesting enough for us to enter like with a real presence and rather than a couple of people in different countries looking at the business development activities. And looking at our global presence, so blue areas in there are the countries where you can see that there is a Kenpower chargers in use. Charging some kind of vehicles there might be some mining vehicles, there could be personal cars, commercial vehicles, depending on the area. But I like to see this slide actually getting more blue from the point of view that we are able to actually access different markets. And the key point here is also that, like we have promised, from our strategy point of view and in the execution have been succeeding that 63% of the revenue already comes outside of the nudics and nudics we consider our home market from the beginning. So this is work well done from the team and according to the company strategy. And then looking at the market outlook in the long run, the outlook is unchanged. So we are looking at still the 2030 very highly growing market because we are looking today about 2 billion market size. We are looking at the growth to 14 billion by 2030 and quite equal share to Europe and North America. As we see the figures is the growth will be more rapid in North America because it's today's figures, it's a smaller chunk today. Then looking at our robust solution pipeline, and it's been released as planned. So these were the topics we raised as main technology initiative when we published our Capital Markets Day material. Two first ones were already Q2 2023. So plug and charge has been released in Q2 last year. We look at the Eichrecht, which opens the doors to the German charging market, especially public charging in Germany. was done also Q2 2023 megawatt charging system and what we call now actually megawatt charging program because it's not a single system, it's not a single product, it's a group of products and completely approach for the megawatt charging. was released in Q4 2023. And then as a last but not the least is the silicon carbide semiconductor-based charging power units. They were released now in Q1 2024. And now I give the floor to Jukka to continue.