Revenio Group Oyj

Welcome to Revenio 2024 financial statement release. And special thanks for all the people who are here face to face at Sanomatalo, and of course, for all of you who are behind the webcast. My name is Jouni Toijala. I'm the Group CEO for Revenio. And today, together with me, we also have our CFO, Robin Pulkkinen. For today's menu is looking like this. So we have five topics. So I'm going to start with the business highlights. Then I'm going to recap the strategy and then also look back to the year 2024, how we have been able to execute the strategy. Then Robin is going to take over to go through the Q4 and the overall 2024 numbers. And then we are going to give at the end the financial guidance. And Robin is going to conclude with the topic revenue as an investment. And then we move to the Q&A at the end. Q4, net sales 30.5 million. So this is reported sales. So if you look the currency adjusted sales term, so we were down 1.1%. Operating profit in good level. So 29.9% from the sales leading to 9.1%. million euros. Then if you look the whole quarter, so the cash flow was extremely strong. So we ended up to the positive cash flow up to the 9.8 million from 5.2 million compared to the last year Q4. If you look where the money came, so more or less exactly the same than before. Tonometers selling well, especially the IC200 probes were selling well. Also the ADON family DRS Plus were selling well. Regional split. So this is the first time that we are giving the exact numbers related to the regional split. So we have been talking about the USA before, but now we have EMEA, LATAM and Canada in one packet and then the APAC. So USA roughly 50%, Europe, Middle East, Africa, LATAM and Canada 33.7% and the APAC 16.6%. 16.6%. Then if we go back to the product, so we have had quite many product launches during the second half. So ST500, then we launched a bit before the Christmas, we launched the iCare Maya device and then two VET products. And we have had also the sales start, so it's different to launch the device compared to have it in the market in a sale. So ST500, So we have been getting the sales already during the Q4 for ST500, same for Tonovet Pro and same for Tonovet PET. And as we have stated earlier, so the Maya micro perimeter is on time. We have already ordered backlog for that one and estimated to start the sales early Q2. Then first time we are also giving out the recurring revenue ballpark. So roughly one third of the total sales. So if the reported sales was 103.5 million this year, so roughly one third is coming from the recurring revenue. So that's mainly probes and the software. licenses and of course partly also from the service contracts. Even though that the 2024 was not particularly easy, so we have been able to implement strategy extremely well and I come back to that one as a next step. So even though The world is in quite turbulent situation quite now, whether it's the geopolitical challenges or economical in general. So no fundamentals of any have changed. So people are aging, more lifestyle related diseases like diabetes are coming up. So the amount of the patients and the need for eye care is growing globally day by day. And then if we match this one with the insufficient amount of the eye care professionals, so we have a totally unbearable situation at the moment. And in order to cope that one, we really need the smarter ways of working, as we have been stated many times. And in order to keep the wonderful visible for all, those growing amount of the patients, so we laid out the strategy at 23 November for the period of 2024, 2025, and then the 26. And that was to watch the connected and predictive eye care pathways. And we had four key cornerstones in our strategy. So the first one was related to the devices. So improve the quality of clinical diagnostics with targeted product innovations. example, rebound technologies, TrueColor, Confocal with full automation. And I come back to how we have been able to execute 2024 in the coming slide. Then the second topic was how do we optimize the clinical care pathways with connected and predictive solutions. So we had three different pathways inside this bucket. So the one was glaucoma care pathway, one was retina, and then we had the retina screening. Starting with the glaucoma, diabetic retinopathy and then AMD. Then we also talked a bit more than a year ago in our capital markets day. We talked about third topic, which was enhanced customer focus in operations and sales. So that included how do we more efficiently work with our supply chain partners, how we work with our manufacturing partners, how we improve the customer satisfaction brand and also marketing and develop new channels to the new segments like diabetic clinics or primary care. And then as a fourth topic, which is the foundation. So we have to guarantee that we have the right competencies at the right time, at the right place. Then we take care that we are able to retain our key people and then able to attract when we hire more. And then, of course, we have been working around our values. and culture. And logic is that if we do these four things extremely well, we are able to continue our profitable growth. And if you go back to 2024, improve the quality of clinical diagnostics with targeted product innovation. So many new products came out last year. So we have been investing constantly more or roughly 10% or more even throughout the years. So if you look last year, a lot of new things, totally new tonometer, Iker ST500, and it's also the basis for the future tonometers which we are going to launch and which we are going to have in a roadmap. And that's a new hardware platform, that's a totally new software platform. Two products for the wet side. Then we have been working with the new microperimeter, and that's looking good. So we have papers already submitted to the FDA. So now we are in the waiting mode to get the feedback from the FDA. Then from the market entry point of view, so China was actually selling well during the Q4. And the reason for that one is that we got the IC, 200 quick measure in during the 2024. We also got the ADON family in, and then we also have DRS Plus in. So now the product portfolio, which we have available also for China, is quite comprehensive. Back to the clinical care pathways, so we acquired the rest of the share from Tirona Retina, so the Netherlands-based AI company, and now that team is part of our iCare team, fully integrated, and really the acquisition logic was of course linked to our retina screening solution, so DRS plus the Illume plus the AI. But the ASPIC logic is as well that how do we enhance our devices with the AI capabilities when going forward. So that's also the... the key in order to understand the acquisition logic. Then what comes to the Illum expansion in the markets. So we have been able to increase the installed base 4x compared to 2023. We have doubled the amount of reports during the 2024. So good traction also what comes to the DRS plus, plus the Illum, plus the AI package. Then on the customer And operations perspective, lots of things done there also during the 2024. So we haven't had any delivery challenges. We haven't had any supply chain challenges during 2024. And we have been able to manage also the cost level that comes to the components extremely well. Then with the manufacturing partners and with our other stakeholders, we have been able to improve the product quality across all the product categories. It has been in extremely good level before, but we have been able to improve that one further. And then we constantly measure the brand and the customer experience. So we have a slight improvement compared to 2023 results to the 2024. So we have slightly able to improve also the brand recognition. And then what is important, so we have been able to build new non-ophthalmic distribution channel also for the screening business. Of course, this is ongoing work, so plenty of work to be done. Then people on culture side, so we have been spending a lot of time and also money to keep developing our leadership skills among the teams and people who are working for us. Then we have also gone through so-called job architecture project where we have been going through all roles and responsibilities inside the company, across all the geographies, and then set up a job leveling for everybody. And then, of course, we have been continuing working on our values and culture. And Robit is going to go more detailed, of course, the numbers and the profitability, but also compare how we have been able to perform in terms of the growth and profitability, what comes to our peer group. So if we think that one, so 2024, we have been returning back to the growth and profitability has been on a good level. So we start to be in the middle of the strategy period. So if the strategy period for us is three years, so that's 24, 25 and 26. So roughly one quarter to go, and then we are the middle of the three-year strategy period. And if looking at the priorities for this year, so we are going to continually invest into the R&D in order to launch the new product. So we have a clear understanding what kind of products we should launch in the future on the tonometry side. Same for fundus imaging and same for the perimetry. And then we have a clear roadmap also, then what comes to our software and solution business. And from the sales channel perspective, so we are doing constant optimization of the sales channel and plan is also, of course, to work with the retina screening solution. And also we have some other products coming on the software side when going forward. to watch this strategy period. Then M&A, I think we are going to talk at least on the Q&A side regarding to the M&A. So constant work is ongoing. Hopefully we are able to move on that front also this year. And then what comes to the ESG. So there the house is in extremely good order. So based on the auditors, so we have run already the kind of a pre-testing for the 2026 readiness, so that we are able to report all CSRD readiness numbers 2026. So now we are collecting the data. But with these words, I think it's time to call Robin here.

Thank you, Jouni. So my name is Robin Pulkkinen and I'm the Group CFO. So going a bit through the numbers. So Jouni covered the top line there slightly earlier, but for the full year, just over 7% growth, reaching 103.5 million. And then for the last quarter, just under 5% growth. The FX has been quite of a roller coaster for especially the second half of the year for us. It was a bit more not so visible in the first half, but then the Euro-US dollar exchange rate kind of peaked in end of Q3 and now it came back down again in the last quarter. So the headwind we had in Q3 came back as a tailwind now in Q4. And now maybe there's one point there that what we have been working on, kind of rearranging a bit of the balance sheet. So a lot of those items that, for example, now have hit the growth or the sales lines have been kind of eliminated in a way that we rearranged the balance sheet so a lot of that FX is actually going to hit the financial costs and returns going forward. So starting from December 1st we did the balance sheet kind of rearrangement there. EBITDA, there's been some kind of one-off costs that have been adjusted out in Q4, not much, under 200k. So the adjusted EBIT actually 30.3%. For the whole year also, we had last year and this year roughly one million of adjustments, which we have brought into the table here. So the full year adjusted EBIT just over 25%, slightly down from last year. So the growth, and kind of like Joni said, we're now back on the growth track. I think just as a recap, last year, our reported numbers were, our 23 reported numbers were flat. The driver there in 22, if some still remember, we sold the remaining stock of our microparameter, the Maya, which Joni was saying that is now hopefully being launched again, and we're applying for the FDA approval. now in the next couple of months, hopefully. So we ran out of that stock at the end of 2022. We had roughly seven million of sales in 2022. In 2023 we didn't have anything to sell, but the sales were still flat. So basically saying that the tonometer and imaging products still grew quite well during the year to kind of catch up for the hole that we had for the moya we sold in 2022. And now in 24, no Maya sales, but reported growth over 7%. Now going into the 25, of course, like we guided, we'll go back to that later, but we're quite positive of the growth drivers we have, and especially the new microparameter that is hopefully coming out soon. We finished the year with a strong profitability. The kind of graphs look very familiar from every year. So the last quarter is always where we make like one third of our profits. We did have cost increases. So in 23, we had very little bonus payments, for example, for all the employees have a bonus program for the performance wasn't really what we were hoping to have back then. But also there has been additional investments into IT and marketing for many of those new product launches that Joanne was going through. The clinical trials actually didn't have, at the end, a very big impact on the profitability for last year. The balance sheet remains very strong. The equity ratio has been growing. Basically, the dividend payout ratio has remained around 50% for the last couple of years, so it's the biggest driver for the improving equity rates. Net gearing has been below zero for the last five years at the end of the year. It's pretty good considering that we at the same time have paid over 45 million of dividends and then acquired companies with the cash reserves and still we have more cash in the bank than interest-bearing debts in the balance sheets. So the cash generation was really good for last year. The biggest improvements, so actually the operating cash flow is up 120%. The biggest improvements actually come from the working capital management. So we've been working on that and paying quite a bit of deep time on that to make sure that we get the improvements in that area. And it kind of pays out well now here, looking at how the cash flow developed over the timeframe here that you have on the graph. So from 2016 to 24, our compound annual growth rate for the operating cash flow has been nearly 19%. And that's the way we kind of plan to run the company in the future also. So we are a cash generating company and we are planning to stay so also in the coming years. So like Jooni mentioned on the R&D investments, we spent roughly 10% of our sales in R&D. There basically two-thirds of our R&D investments go into hardware and embedded software. So in Italy we have our imaging and perimetry teams. Italy in general is our biggest single site. So there we do have a quite big R&D team. The tonometers are are managed and developed in Finland. And also in Finland, we use quite a bit of outsourced service providers for non-core R&D work that we buy from the outside. And then the one third actually goes to the software development, which is mostly in Melbourne, Australia. Also a couple of people in Italy office helping on that work. And then the competition. what we have drafted here is kind of a combination of publicly available competition data on the net sales growth, EBIT growth and EBIT margin. So kind of the movements have been similar going into the same directions. I think the right hand side here on the graph, the EBIT margin, you can see that our profitability level has been on a totally different level than any of the publicly available data that we have. And also non-listed companies that we have been looking at. It's quite exceptional level where revenue is moving. So our profitability has come down. Now we finished last year, 25%. So come down from 30 to 25. Looking at the competition, the relative drop from 15 to 5 is actually quite big, even bigger, a lot bigger than revenue. And then the dividends. So the board is proposing to the AGM, 25 AGM in April, that a dividend of 40 cents would be paid. So the dividend payout ratio is 57.6%. We do maintain or plan to keep a strong balance sheet to finance acquisitions. So like we've been talking, we've been working on that a lot. We've had challenges on the valuation level still on many of the targets and could have closed deals, but haven't moved because we have thought that they're not good for the shareholders. And also we aim to pay a sustainable dividend that doesn't endanger the parent company or the group liquidity. Shareholders, there are not really any major changes during the year. William Demant has bought roughly 1.5% more or 1.7% more, if I remember right. Other than that, the other companies are very much the same that we had a year ago and more or less in the same order almost also. The foreign ownership is just over 51% or 51.7% now. The Finnish ownership actually went up a little bit from end of Q3. there has been activity there. Demand has been buying more shares in Q3 and Q4 at least, but quite small blocks, nothing significantly changing the ownership structure. And like we said back in the CMD in end of 23, this still holds. So despite what the guidance is, we are still targeting to grow three times faster than the ophthalmic diagnostic device market starting from this year. So revenue operates in the ophthalmic diagnostic device market, which is roughly 3.5 billion USD in size. With our product portfolio, we roughly cover one third of that market. The tonnometers growing roughly 2-3%, that's roughly tonnometers with the probes excluding the home, 200 million market annually. Retinal imaging devices growing faster than 4%. That's also roughly a half a billion market annually. And then the perimeters growing around 2% on average and the market being around 300 million. And the guidance for this year, our exchange rate adjusted net sales are estimated to grow six to 15% from the previous year and profitability excluding non-recurring items is estimated to remain at a good level. Then to the Q&A.

Did you... Jump in as well. Yeah, you're welcome. Nikko. So, hey, let's do so that we have to juggle a bit. So we have three ways to actually put the questions forward. So we have the audience here and then we have a webcast team behind the camera. And then we also have the chat availability. So we start from Nikko here.

All right. Thank you for the presentation, Niko Rangas from SEB. I have a couple of questions and maybe continuing first on the guidance you discussed about. So you are now giving a bit more broad guidance compared to last years. So what is the reason for this wider guidance range? And then especially thinking about the lower end. So what kind of scenario do you think that should happen that you will treat the lower end given the new product launches?

So, yeah, it's wider than last year. Before that, we had the verbal guidances. It's quite a bit of changes going on. Like we can see, every week is quite exciting from the news point of view. It is a bit hard to see how the year is going to play out, especially with the tariffs, which so half of our sales are to the US. And there has been tariffs discussions. We're still kind of optimistic that it won't hit us too much. And maybe the good thing is that many of our competitors are not also US companies, rather they also import many of them. So that is one play. Jooni, would you?

Yeah, I would agree that if you think that what's the scenario for the lower end of the guidance? So it's a big geopolitical hassle and then it's a full on trade war. And we are looking quite optimistically what comes to the these tariffs against the medical technology. So my assumption is that for sure the US is not going to start from there as they haven't started yet. But if you want to name a one low end guidance scenario, so that's a big geopolitical hassle and full on trade war, which currently I'm at least quite optimistic that we are not starting from the medical devices.

Okay, so that we can interpret you haven't seen market turning to a bit slower or more negative development now recently.

So if you look at Q4 and we even go month by month, so we start from October, November, December, so we saw better performance every month towards the end of the Q4 and towards the end of the year. And as I said in the release, so we had a best ever month on the December around the company's history. Of course, that's a one month performance, but the January is going according to the plan, what we said.

All right, thanks. Then on the cost side, you also already mentioned a bit about costs related to IT and marketing and so on. But then you also had some extra costs related to FDA applications, which will probably continue somewhat also this year. But if you summarize this, so what kind of cost pressure do you see in 2015?

25, I think, well, the salary or the personal costs are roughly 60% of our fixed costs. There, the salary inflation is probably one player that will have a cost increase in impact. We do have some resource needs to be hired, but also at the same time, I think the FDA path and the clinical work is one we're still kind of investigating how how that is going to play out. We don't have a full visibility yet to that. And then we do have significant cost rated, for example, the Maya launch for this year. But kind of, there's quite many areas like the IT in general, there's quite a bit of new regulation coming that kind of requires investments into that side as well.

So if you kind of compare development plus marketing expenses related to the new product launches in 24 and then maybe marketing expenses related to those products in 25, so you think that those will come up year on year?

Probably there will be a little bit up, it's not fully certain yet how that's going to play out, so the VET products are also new, we're still spending quite a bit on the marketing. The take up for the Pro, which is based on the old, or our human side IC200, has actually taken off really well, so I think there are also good plans for the kind of making sure the market is aware of these new products on the wet side, for example, still this year, so it's not all kind of burned last year. So we're still working on getting that message out.

All right, I understand. Then the FDA process, which you already mentioned briefly, so given you didn't have much of those costs in Q4, could you give us an update on how it's progressing?

I can pick up that one. We are actually in quite interesting situation with the FDA. Now we also have been discussing about the two-sided strategy, so that we get the FDA approval with the other camera manufacturers. and then we apply for our own. And now we have been in a more detailed discussions with the other AI players that they take our DRS Plus and going also through the logic that why they have been delayed and the reason is following. And now we are trying to figure out this one with the FDA that how do we go forward is that if you think the reference device, which is normal fundus camera, And then you have a human grading for that one. And you compare the image quality of our cameras. So our camera plus the AI is detecting way more than the reference. implementation, so that means in practice that if you reference devices normal fundus camera, then you use the human to detect. So with our camera, we are detecting more. And then the FDA thinks that there's a so-called false positives, even though that they are real. And now we are having a discussion with the FDA that how do we go forward, because the overall quality of the camera and the AI is way better than the reference. And this is a discussion now. So now the latest logic is that we have an answer for this one. And then Q1 hopefully goes so that we finalize the protocol and then we are able to start the clinical studies. But that means in practice for the timeline. So we won't be ready end of this year, which was the original plan. But now we know the reason that why it has been so difficult for the other players with our camera and then why we have been going through and negotiating the protocol with the FDA.

All right. Thank you for the explanation. Do you still think that 26 could be a realistic scenario?

Yeah, I think that one. But OK, I said that I would be disappointed in the CMD if we wouldn't have last year the third party AI approved with our cameras. But now we for sure we know what's the reason.

I understand. Then the last one from me, at least at this point. You have now lived a couple of months with Tiro and Retina together. So how has that been? Have you been able to already generate some synergies or other benefits from this collaboration?

Yeah, that has been actually going well because we have also been able to start working on the overall clinical AI roadmap with them and what to implement and what not. So that work has started and if we wouldn't have the asset of our own, we wouldn't be able to dictate together with them that what's the direction of the clinical AI, where do we want to take it. So team has been so far been happy, but of course we have to take good care of them.

All right, thanks. That's all from me at this point.

Thank you. Hey, should we jump to the online and through the telco line? So any questions coming from there and then perhaps we have one from the web pad and then we go, then we see who is next.

If you wish to ask a question, please dial pound key 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key 6 on your telephone keypad. The next question comes from Jack Reynolds Clark from RBC Capital Markets.

Please go ahead. Hi there, guys.

Thanks for taking the questions. I had a couple, please. First, on revenue growth in Q4 and actually through 2024, could you quantify the contribution from tonometers versus fundus? And within the fundus element, could you talk about how the underlying growth there fared without that big lump sum order that you had in 2023? The next question was just on guidance for 2025. So we touched on the downside scenario within that guidance that you gave. Would it be fair to assume that if actually the economic situation or the macro geopolitical situation doesn't deteriorate too badly that we can expect growth in the upper end of that range in line with where expectations are right now? And then just on phasing, could you kind of run through a bit of detail on how you're expecting growth and profitability to progress kind of through Q1 to Q4 this year? Thank you.

I'll try to remember. I'll stop at the end. I remember those. I write them down. So I think we... In general, like we reiterated the CMD kind of message that we are still targeting to reach three times market growth. Basically, that clearly means we're targeting double-digit growth going forward. Of course, it's a bit difficult to know what the market growth is. We don't know what it was last year yet. But the idea is that we're targeting double-digit growth there, definitely. We haven't disclosed exactly how the tonometer and imaging growth has gone last year, but basically all our main product groups were doing really well. So I think in general there's nothing. The home is probably the fastest growing single device in our portfolio, but the IC200 has remained to grow really well. Probes growing well. Yeah, the probes growing really well. IC200 even taking space from the IC100, so that's totally fine for us because it's a higher ASP product. On the imaging side, the ADEN family has been doing well. And then in the last quarter now, we did have last year some big orders on the DRS Plus, which didn't happen. Or in 23, we had the big orders there, which didn't happen in Q4 last year. So the catch up was mostly down from smaller deals. And that, of course, looking at Q4, the DRS Plus was slightly down because we didn't have those big orders. But for the whole year, I was still doing pretty good. And then going into this year, I think The trend has been very similar. We normally start Q1 as normally our worst quarter and then Q4 as the best quarter. At least there's nothing in my mind that I know that would kind of dramatically change that, how we see this year performing.

And then, right Jack, so you had one concerning the guidance and the lower end of the guidance as well. Do you want to, Robin, comment that one? Or was I right, Jack, on that?

Yeah, I think the first comment saying that we're targeting three times market growth, yeah, was meant to answer that.

Yeah, yeah, no, no, no, that's super clear. Thank you. I guess just a quick follow up on the phasing piece. From a profitability perspective, is that also your expectation that Q1 the best, Q4 the worst, Q4 the best?

So I think, Chuck, I reiterate the question. So if thinking year 2025 and the quarterly fluctuations, which quarter is good and which is bad one. So was that the question, right?

Exactly, yeah.

Okay, good, good. So I wouldn't see too much of surprises compared to the past history. The only new swing factor here is, of course, the micro-perimeter, MAIA. So usually the Q1 has been, of course, clearly poorer than the Q4. Q4 always the best quarter of the year. And now I think what most probably is going to change the equation is having a micro-perimetry sales starting to come through during the Q2. But otherwise, I would say that perhaps the history repeats itself.

Great. That's super clear. Thanks, guys.

Thank you. Hey, let's go to the iPad next.

So what kind of... The next question comes from Pia Roskvist-Heinzalmi from Carnegie Investment Bank.

Please go ahead. Hi, Jouni. Hi, Robin.

Thank you for the presentation. It's Pia from Carnegie. A few questions. Still regarding the guidance for 2025, so do you have any verbal comments regarding your expectation by product segment? So how do you expect the tonometers to grow versus the imaging devices?

I think the last couple of years, it's been pretty stable for both product groups, even though 23 was flat, like we talked earlier, there was the 22 Maya big order that kind of mixed up the numbers. So in a way, we've had a pretty solid growth from all the main products in the imaging and tonometry. And I think our kind of internal targets and budgets seem to be in the same kind of trend for this year, so them all performing similarly well that we've seen last year, or do you only have any different view?

I agree. And perhaps the one thing compared to the last year, and what we see for this year is perhaps the APAC performing better than the last year. So we have seen the positive signs, as an example, India, Japan, then China, So as I said earlier, so we have now IC200 with quick measure in, we have aid on family in, we have a DRS plus. So based on the current understanding from the APEC side, we are going to have a good pick up during the coming quarters. So especially India, then we have China and then also Japan.

Okay, thank you. And then a follow-up regarding partly what you discussed earlier, your efforts in improving, you know, the product design, et cetera. So do you have or have you reached, you know, or have you, how should I phrase this? So the gross margin, is there room to improve or is it, Are you planning to hike prices, or do you see improvement in the gross margin driven by your strategy work?

So, I would say, if we think in the long run, of course, devices are going to have more software baked in, more intelligent baked in. But we are committed to keep this magical 70 what we have on the internal slogan, what comes to the cross-marching. So the goal is to really keep the overall cross-marching over 70. And of course, that's then kind of a blended cross-marching. So tonometers over 70. And then if you go for the imaging, So imaging side, then, of course, they are slightly below the 70, as we have discussed earlier.

Robin, anything you would like to add on this one? Yeah, I think the bigger impact on the gross margin is when we launch totally new products. So kind of the cost structure, the bill of material doesn't really... It doesn't change that much when the product is out in the market. At least that's been the case in the past. So it's more like the DRS Plus was a lot cheaper than the old DRS. And then it was selling for a lot higher ASP.

That's clear. Thank you. Then two more questions. Regarding your Emmet A headroom, how much would you be comfortable in spending on a deal?

I think the kind of the kind of net bearing debt or interest bearing debt to EB that we kind of definitely plan to keep it reasonable. So kind of that sets certain limits. We do have equity issue rights and are going to apply for such again in the AGM in a couple of months like we've had for 10 years in a row. So those kind of set. But I think in the longer run, the debt burden on the balance sheet, I think we're definitely wanting to keep it below three times EBITDA, for example. So not stretching it too much. And also, if there were companies that were able to acquire that, expand the product portfolio, that comes with the kind of the The result of that is that that would open the opportunity to go direct in other certain countries. And then we need to have money to fund those transactions as well.

Thank you. Then finally, regarding the possible tariffs to the US. So how are you prepared to tackle those if they are placed?

I've had a couple meetings already on different tax specialists and U.S. customs specialists, and there's quite a few different things we can do, but kind of the message in general is that we can't fully avoid it. So that would have some level of impact on revenue numbers, but we're kind of working on having a plan how to mitigate it if that does happen. And that's one reason for the wide guidance kind of spread.

Yeah. All right. Thank you. That's all for me.

Thank you. Let's take the question from the pad. What kind of investments we have done to the R&D investments we have done during 2024? How they have been having an impact to our competitive situation and are we expecting to have any other product launches during 2025? Maybe I pick this one. So this is of course the longer term investment which needs to go in. So we have been constantly investing 10% or more to the R&D. And if we take as an example the product which we launched last year, ST500, so it takes years to develop that one. So that's a prime example of what we got from money also, Tonovet PET. and also Tonovet Pro and then of course we have been investing now for next generation Maija and those all are improving our competitive situation in selective segments. Then last part of the question was that are there going to be any other product launches during the 2025 so unfortunately I cannot comment on that one but it's a very good question. Maybe I take another one also from the pad. Hi, some questions from my side. What kind of one-off costs were recorded in 2024? Are clinical trial costs included in these one-off costs or not? And what are the segments, geographies which saw negative growth during the Q4-24? And then there's one question for Maija, but I pause here so that you remember, Robin.

So one of the clinical trials are not one-off costs for us. So those go through the regular operating expense. In Q2, we wrote down the Ventica, which was kind of reported back then. And then we do have had some couple of hundred thousand on certain one-off project costs that are not really related to our daily business. So it's more related to projects that are not related to the daily business, basically. That's pretty much all I can comment on that.

Yeah, and then we had one question regarding to the segments or slash geographies, which showed the negative growth in Q4 2024. I think that was linking to this bigger one of deals, right?

Yeah, yeah, yeah, yeah, yeah. So I think the Q4, even though it was, FX suggested, roughly flat, I think we did have a multi-million deal in the comparison period related to DRS+, which I mentioned, which which we didn't have this last year in 24. So we were able to kind of sell that or fill that gap with a lot more smaller deals. So we didn't have any single one large off deals like we did the year before.

And then there's a last question concerning the Maya order backlog. So as before, so unfortunately, we don't comment on individual order backlogs and the amounts of the order backlog. So sorry for that. Any questions from the audience? Yes, we have.

Yes, thanks. Daniel Lepistö from Danske Bank. Maybe still going back to the guidance and the profitability guidance you issued, that the profitability is set to remain on a good level. I guess you have at the same exact wording. when your EBIT was 30% and now when it is 25% so I guess the range is quite broad what is good profitability for you but I guess the question is that if your growth accelerates I guess there is plenty of operating leverage to kick in so or are there some sort of cost items that would you know, restrict the margin expansion if you accelerate the growth this year?

I think if we could, with the same fixed cost base, probably sell, like if we did have like, say, big deals for 10 million, that would increase the EBIT by 7 million, more or less, because we would be able to deliver that. So it's really scalable in a way if the top line starts to grow faster. no further elaboration on the on the margins you know margin ranges behind the oh that one yeah yeah so so the yeah the the good has been uh we've had that i think for i don't know how many years probably seven eight years at least uh so so it's it's uh yes it's not one or two digit spread so it's a bit wider uh and It doesn't really mean, I've heard comments, somebody saying that some people have read that the guidance means that the 25 is where we expect to be this year, which was the last year one. That's not what it means. It's the spread that we have internally.

Thank you. Then a second question on the ST500 and the market feedback that you have got this far. Were you already selling on full speed on Q4, or is the momentum only gathering pace? I guess also the same question for these new Tonovet models. And maybe a reminder on how is the market looking for this Tonovet product nowadays, how big it is, and is there a growth runway in that market? Thanks.

I would perhaps at this time for part of those ones, so for regarding to the ST500, so we didn't have a full quarter, so we were starting to see towards the end of the quarter, so kind of a mid of mid of November and early December, so not full. Feedback for the ST500 extremely good from the market, so hopefully contributes also of course to the Q1 sales.

The tunnel vet, I think, or the vet business in general has, it was a bit slower for a couple of years, but now the last couple of years has been actually quite positive, which is really good because it is extremely profitable because there is roughly any regulation. So we can just go and sell almost anywhere without needing any FDA or China government approvals for anything. So it's a lot smaller team that can run the business. The devices have similar margin levels still.

All right, that's all from my side. Thank you.

Yeah, thanks. Joni from Nordea. Maybe still a question on the recurring revenues. Could you give any indication of the split between there? how much the software sales is of this and any indication of the growth rate here?

Yeah, I think the I guess it's not a surprise that the probe part is the vast majority of that. So we, I don't know how many probes were sold last year, but 40, 50 million, I would guess. So that's a big part of that pool. Then we have service and then we do have the software part, but we don't really specify yet what that kind of fully consists of. So I can't really open exactly what is there.

And maybe follow up on that, I know that you have been speaking quite a lot of that you are not putting too much, you know, R&D spending on the IT side or software side before it starts, you know, to go in the right direction. So is it now, you know, you are speaking quite a lot of the software. So do you see that you could start to increase the spending on that front also?

I think that the logic has been that we keep quite tight guardrails for it, because we have to be sure if we look at the strategy. So really the key for us is that we have the best products in the selected segments where we are. And that includes the investment on the hardware. it includes investments into the embedded software side. And if we have the best products in selected segments, then we are able to also in the long run to add the software and the cloud components behind them. And that's a logic that why in the capital allocation side we have been keeping really tight guardrails that the majority of the capital allocation goes to bringing and keeping the competitive product portfolio in place. So two thirds of all R&D investments goes to the device hardware and the embedded software. And then we have a a fixed amount, the one-third which then goes to the cloud side of the software. And if we look last year, 2024, and we look this year, so in terms of where do we allocate more money? So we allocate more money to the device and embedded software bucket compared to the cloud bucket. And it's perhaps on the cloud side slightly more money, but quite tight guardrails. Because now we have a good retina screening solution, now we have to make sure that we get the adoption for it. And of course the FDA approval cost, that's another story, but that goes more to the go-to-market side. But we have now a solid retina screening end-to-end platform, which is the DRS plus the Illume plus the AI. So it's good enough, but now we really have to scale up the sales.

Okay, thanks.

That's all. Should we jump to the pad as well? I think we actually answered to this question already. So we had one question related to new products and the availability regarding to the demand and the backlog. I think we covered that one in an earlier question. Then we have, could you please comment on competitive environment and dry heart product tonometer market and how do you see them gaining market share? So perhaps I take this one. So nothing has changed on this one. So I think situation is exactly the same what we discussed when we released our Q3 results. So probes have been selling really well. We have been able to sell really well the tonometers during the Q4. So we haven't seen the Raiherd eating our market share, at least not during the Q4. And same still applies. So we are, of course, carefully monitoring the situation. Then one question regarding to Maya. Are there some delays in launching Maya? Please, could you comment on the launch and the sales contribution for 2025 versus 7 million micro perimeters in 2022? MAIA progressing according to the plan, and as I said, so now the FDA process is ongoing, so we have provided all the documentation required to get the FDA clear, so now we are on the waiting mode. Product maturity, that looks good. All clinical studies we have done. And then what comes to the 7 million ballpark, so the traditional sales of MAIA microperimeter used to be a ballpark of two to three million, and then we got this one-off deal in 2022 between Q3 and Q4, which was the seven million. So I would say that I would be extremely disappointed if we are not selling more than this traditional steady two to three million. And of course, seven million is quite high one-off, but we are expecting steady demand on the Maya when we get that one ready for the sales start and approvals done. Any other questions from the audience? Anything online? Nothing.

There are no more questions at this time. So I hand the conference back to the speakers.

Excellent. Thank you. So thank you very much for coming. Thank you very much for all you behind the webcast. And next time for the shareholders, whether you are existing or the new ones, most probably then we are going to, of course, have AGM early April. And then we come back regarding the Q1 earnings release then end of April. So thank you very much for your participation.