Landis+Gyr Group AG

Ladies and gentlemen, welcome to the Analysts and Investors Calls full year 2024 conference call and live webcast. I am the course call operator. I would like to remind you that all participants will be listening on remote and the conference has been recorded. The presentation will be followed by Q&A session. You can register for questions at any time by pressing star N1 on your telephone. For operator assistance, please press star N0. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Christian Valti, Head of Investor Relations. Please go ahead.

Thank you, Yousef. And good afternoon, good morning, everyone. As you know, Earlier today, Lens & Gear issued its results ad-hoc release and related presentation for financial year 2024, which are available on our website. Before we get started, please note that some of the information discussed today contains forward-looking statements and we want to explicitly emphasize that there are numerous risks, uncertainties and other factors, many of which are beyond Lens&Gear's control, that could cause Lens&Gear's actual actions or performance to differ materially from the forward-looking information and statements made in this conference call or in this presentation. Consequently, Lens&Gear can give no assurance that those expectations will be achieved. You can find further details on slide 2 of the presentation and in the press release. This session will follow the structure of the earnings presentation, so we encourage you to follow along. We will conclude with Q&A, where Yousef will provide further instructions and where you will be able to ask questions. Of this short introduction, I'd like to hand over to our Chief Executive Officer, Peter Mainz. Thank you, Christian.

Good morning and good afternoon, everyone. I'm here with Davinda, our new Chief Financial Officer, who started in his new role on April 1st. We are pleased to present our full year 2024 financial results. That said, let's now start with a review of the highlights from our performance in financial year 24. FY24 was marked by strong commercial momentum. We are pleased to report a very strong order intake of $2.6 billion, resulting in a book-to-bill of 1.5. This success was driven by our teams delivering key wins in the Americas and Asia-Pacific, alongside notably solid performance in EMEA. Many of the wins were centered around our leading grid-edge technology solutions, including supporting software applications. Our backlog reached a new record high of $4.6 billion and provides a strong financial foundation and visibility for our long-term growth. Revenue declined year over year, primarily due to the exceptional pent-up demand release in FY23 and temporary tariff-related shipment delays in March, right at the end of our financial year. Our EBITDA margin came in at 9.9%, in line with our updated guidance and included previously disclosed one-off items. Including all one-off items, our EBITDA margin was 10.4%, which is a solid result given the lower top line. We prudently passed the Progressive Dividend Policy to preserve balance sheet strength and maximize flexibility. The Board therefore proposes a distribution from capital reserves of Swiss franc 1.15 to our shareholders. We intend to continue our Progressive Dividend Policy in FY25. Since the announcement of our strategic transformation in October of 24, the team has been working full steam, pushing the different initiatives forward and we'll talk about it in a minute. We also made significant progress on our sustainability commitments and are proud to report on our global achievements. But prior to that, let's turn to slide 4 and look at the update on our strategic initiatives. Back in October 24, we announced the sharpening of our strategic focus to drive value creation for stakeholders by ensuring we position each part of the business for the greatest possible success. Let me provide you with an update on the three initiatives. In the Americas, Performance continues to be strong and the region offers the greatest opportunity with higher value software and services solutions as part of our differentiated edge to enterprise offering. The Americas is our largest and most profitable segment and offers the highest return on capital of around 40%. In December, Prasanna took over the leadership of the region. Prasanna is as close to an industry icon one can be and we are delighted to have him back at the helm. In January, we announced that Audrey Sibelmann, currently Vice Chair of our Board of Directors, will take over the chair position at our upcoming AGM in June. Audrey has extensive leadership and industry experience in the international power sector, having served in both utility executive roles as well as on the regulatory side of the industry. With Davinda joining us this month, Our management team is now fully assembled and exceptionally well equipped with talent and experience to lead us forward. CEO, CFO and Chair are all now US-based, showcasing our continuous focus on the Americas region. We have mandated an investment bank for the best value creation from the EMEA business, including a potential sale. This review process is ongoing and we will provide an update as soon as a decision has been taken. In March, and as a result of the strategic review, we have taken the decision to exit from our EV charging business, which we had entered in 2021 through the acquisition of Etrell. With KD Group, we found an ideal buyer that secures the path forward for employees, customers and partners. Now that EV charging is no longer being part of EMEA, the business is very much focused on its strongest capabilities. A leading provider of smart metering devices and solutions across EMEA with long-standing and intimate customer relationships. We are the number one independent provider of residential AMI solutions and the number one player in electricity ICG in EMEA. The robust order intake in EMEA reflects our leading position in the region and underscores the team's dedicated focus. At FY24, the Americas business accounted for 56% and the majority of our profitability. The US listing will allow us to be closer to the capital market in our largest region and give us access to large pools of capital. The entire process is complex and requires time. Everything goes according to plan. We are targeting a listing in 26 and intend to be dual listed for a transitional period to offer an exit option for investors which cannot hold US stocks. Let's move on to slide 5 and an update on sustainability. At Landes in Gier, sustainability is deeply integrated into our long-term strategy and operations and remains central to our mission. In FY24, we made significant strides toward our ambitious science-based targets, validated just last year. I'm proud to announce we've reached 96% renewable electricity use across the group and reduced our scope one and two emissions by over 60% since 21. Furthermore, through effective collaboration with our supply chain partners, we improved efficiency, cutting scope three emissions by 12% per 100 US dollars of revenue. The impact of our deployed technology is also substantial. Our installed smart meter base enabled the avoidance of 9 million tons of CO2 last year alone. To put that in perspective, that's eight times the emissions from our own operations and comparable to annual emissions of a city like Vienna or Tucson. Our ESG leadership continues to earn external recognition, including an ISS ESG prime rating, an MSCI AA rating, and the prestigious Ecovadis platinum medal. Our core purpose remains clear, partnering with our stakeholders to manage energy better and accelerate our collective journey towards decarbonization. Let's have a look now at our winning technology on slide six. Grid instability, as demonstrated by recent blackouts in Southern Europe, demands enhanced grid edge intelligence. Our connected grid edge solutions are specifically designed to provide this critical insight for utilities. Across all regions, we have expanded our grid edge solutions, demonstrating the strength and scalability of our technology. Let me share how we're leading the way with scalable connected grid edge solutions. Through our strategic collaboration with OATI, we launched Landis and Gear DERMS, powered by OATI, an integrated single pane of glass platform that enables utilities to seamlessly manage distributed energy resources like EVs, solar, and battery storage across all customer segments. We are also expanding intelligence behind the meter through our expanded partnership with SPAN and the introduction of SPAN Edge, a first-of-its-kind intelligence service point that unlocks electrification and transforms homes into dynamic grid assets. FanEdge delivers real-time visibility, precise control and flexible load shaping benefits beyond traditional non-wire alternatives. Empowering utilities to better manage load growth, avoid costly service upgrades and unlock unprecedented orchestration at the grid edge. With grid edge intelligence as a foundation, We're unlocking new value for utilities through edge and cloud-based application, expanding our software and services portfolio and accelerating recurring revenue growth. In 24, we saw a major surge in adoption of our Revelo grid sensing platform, a key enabler of real-time visibility and decision-making at the edge. With over 10 million units contracted and 2 million delivered, this next generation grid sensor is a major driver of our very strong order intake, which we will talk about on the next slide. On the other hand, the fast adoption of the Revelo platform by customers has triggered an inventory obsolescence of $20 million and FY24. Before going more in depth into our consolidated financials, let's now look at our order intake and backlog, which provide an additional perspective on business momentum. Our strong order intake of 2.6 billion resulted in a book-to-bill ratio of 1.5 for the company with a book-to-bill ratio above one across all regions in line with our strategic aim and sustaining a book-to-bill ratio of one over the long term. Order entry was particularly strong in the Americas region with key wins in North America as well as Japan. In APAC, our team has secured its largest deal to date, marking a significant milestone in our regional growth strategy. Landes & Gier recorded a record backlog of $4.6 billion, representing a 22.9% year-over-year increase. Notably, growth in the Americas was particularly strong, with the regional backlog expanding by 26.2%. Although regional dynamics vary, the trend towards higher software content is evident, accounting for approximately 35% of the recorded backlog. Approximately $1.2 billion is expected to be executed in the next 12 months, while a significant share is aligned to long-term programs with execution extending into 26 and beyond, particularly software-rich projects. And now I will give the floor to Davinder, our CFO, and he will run us through the financials in much more detail.