Nemetschek Se Unsp/Adr

Ladies and gentlemen, and welcome to the Nemetech SE earnings call for the financial year 2024. At this time, all participants have been placed on the listen-only mode. The floor will be open for your questions following the presentation. Let me now turn the floor over to Stephanie Zimmermann.

Thank you, operator, and hello and welcome to the big welcome.

Thanks for joining our earnings call today to discuss the reprise for the financial year 2024 and the outlook for 2025 with us. With me today are our CFO, Yves Patrine, and our CFO, Louise Wilberstrom. Today's conference call is being recorded. A replay of the call will be available at our website after the call. Additionally, you will find the annual report, the presentation, and the press release on our investor relations website as well. But now, let's get started. So I would like to turn over to our CEO, Yves.

Thank you, Stephanie. Welcome, everyone, to our Financial Year 2024 earnings call. As usual, we have prepared a short but informative presentation on the highlights of the Financial Year 2024 that our CFO, Louise Everström, and I will briefly walk you through so that we have enough time to address any questions you may have during the Q&A sessions. As you can see on slide number two, we have a few topics today that we would like to talk about. We start with a short review of the financials, as well as a strategic highlight of the past year 2024. Before we give you an update on the considerable progress we have already made in our transition to a subscription and SaaS-centric business model. For that, I will hand over to Yves, who will dig a bit deeper into important aspects of our financial results. Finally, we will also talk about our financial outlook for the current financial year 2025. After celebrating the 60th anniversary of the Nemetech Group in 2023, we reached another significant milestone last year, the 25th anniversary of the IPO of Nemetech SE. The company's IPO in 1999 marked the start of an impressive success story. Over the past 25 years, Nemetschek Group has grown from a small German software provider to a leading global provider of digital solutions, the AECO and media industry. His success story is first and foremost rooted in the strength of operational business. And his operational strength that has made 2024 another very successful year for the Nemetschek Group. despite the growing global challenges in economic uncertainties, particularly in the construction industry. Thanks to a clear strategic direction and innovative strengths, we have mastered the challenges of the market and also further strengthened our position in our ADCO and media industries. When we translate what I just said about our past financial year into measurable KPIs, you will see on page number four that we achieved or even clearly exceeded every single one of our financial goals in 2024. Starting at the top, the revenue growth. We had a very strong finish of the year, especially in our design and build segment. We finished the year with a total revenue of 996 million euros. or organic, so without the contribution of GoCanvas, and currency adjusted growth ended at plus 14%, significantly above our guidance range of 10 to 11%. If we look at the contribution from GoCanvas, which we consolidated as of July 1st, 2024, we see that the acquisition has also delivered a very strong result. adding around 300 basis points revenue growth, and therefore exactly in line with our plan. Bank growth driver was once again our recurring revenue, and in particular, the demand for subscription and SaaS solution that is captured here in our annual recurring revenue KPI, which grew by plus 34.6% organic. So clearly above our target of more than 25%. Same is true if we look at the ARR growth including GoCampus. With a growth of plus 41.9%, the increasing ARR is significantly exceeding our revised outlook of more than 30% as well. Group ABDA including all transition and acquisition related effects grew by plus 16.8% to 301 million euros. The corresponding reported EBDA margin, including GoCanvas, 30.2%, as well as the organic EBDA margin, so excluding the derivative effects, the still lower profitability of GoCanvas, and the impact the PPA charges, 31.1%, where in both cases, slightly above the upper end of our forecast range of 29% to 30%, and the revised one, 30% to 31%. And last but certainly not least, the success of our subscription and SaaS strategy becomes evident by looking at the development for recurring revenues. Now, with our guidance, the share of recurring revenue as a percentage of total revenue strongly increased by plus 10% and so on, year over year, to a new record high of 86.5%. In addition to our financial highlights, you see an overview of the various strategic highlights in 2024 in each of our defined area on page number five. Starting on the left side, artificial intelligence plays a key role in optimizing our internal processes as well as in our product development to further enhance solutions of our customers. In this context, it's important to us that all our activities are based on ethical and trustworthy AI practices. Sporter Accelerate, or AI activities, we have established for AI and Data Innovation Hub in 2024. The idea behind this hub is to drive efficiency and innovation across the entire Lemaitre group and to create synergies. While we have again introduced multiple new AI capabilities in 2024, we will continue to add additional AI features to our solution in the future. So stay tuned. As you all know, it is virtually impossible to achieve any of the global climate targets without making the construction and operational phases of buildings more sustainable. Therefore, aim to set new standards is our leading solution for an environmentally friendly and resource-efficient construction industry and have consequently integrated sustainability more deeply into our corporate strategy. Of course, one of our absolute key priorities is to further strengthen our resilience by continuing to increase the share of our recurring revenue, in particular by transitioning to a subscription and SaaS-centric business model. I already mentioned the new record high that we achieved in Cibaria in 2024. As we want to keep you updated on the progress of one of our key strategic priorities, we'll provide a detailed update on our subscription transition in a few minutes. Over the last year, we also continued to improve our go-to-market strategy, for example, by further strengthening or expanding our international footprint. Our aim is to further increase our resilience, for instance, by continuing to reduce the dependency on the European market. In order to achieve this goal, we focus on higher growth regions such as North America and Asia-Pacific. Q2 2024, for example, opened our first Nemetech India go-to-market office in Mumbai with a dedicated local team to sell multiple solutions under the Nemetech brand. By expanding presence in the Indian market, we want to participate in the enormous growth potential of the Indian construction market in the coming years and decades. India is the third largest construction market in the world. Going forwardward, we'll not only continue to address additional high-growth markets such as the Kingdom of Saudi Arabia, but also continue to strengthen our cross-selling activities. Our growth platform and infrastructure are another cornerstone of our corporate strategy. They're targeting a comprehensive ecosystem by eliminating information silos and by enabling end-to-end workflows. This also enables us to introduce new and innovative products as our open data-centric digital twin solution DTWIN. As you all know, M&A has always been an integral part of Memetech's DNA, as well as the company's tremendous success story. We are therefore very excited that we were able to acquire GoCanvas in July 2024. GoCanvas is a leading provider of field worker collaboration software that digitizes additionally paper-based processes, simplifies inspection, and improves safety. It is by far the largest acquisition in our company's history and also a perfect fit on Emetec in terms of technology, customer base, and geographic presence. And as we were already able to report with our Q3 results, integration of GoCanvas is going according to plan and we continue to be very pleased with the operational developments. Going forward, M&A will remain a cornerstone of our strategy and we'll continue to screen the market for next value acquisitive acquisition that are perfect fits for Volvio. Another way to be at the pulse of the latest technological developments and trends in our industries is via our venture investment strategy. For the last year, we again made several minority investments in a series of young and highly innovative companies. An example is Document Crunch, which uses machine learning to analyze the risk within the thousands of pages of construction contracts in projects. In the light of recent events, one of their most popular features at the moment is their carry-risk assessment tool, which analyzes the impact of tariffs on construction contracts and such projects. In total, over the last three years, the Nemetschek Group has acquired minority stakes in more than a dozen companies that will help us to further increase our innovative strengths and to cover important future topics like cloud solutions or artificial intelligence. Finally, in the area of business enablement, we work on a further harmonization across the Nemetschek Group. This includes continued efforts to further enhance our operational excellence in order to ensure that we will be able to continue to make the most of our tremendous growth opportunities. There's no focus on a main priority or journey to a recurring business model. In slide number seven, you will find a comprehensive overview of the current status, the conditions. As you all know, the MetaGroove is quite unique in that we do not transition our entire portfolio to a subscription-pass-centric business model all at once. One of the advantages of a brand setup is that we can migrate our portfolio in a phased and segmented approach. It does not only give us substantially more control over the entire transition process, thus significantly reducing the associated risk, but also makes the migration more easily digestible for our customers and users, as well as for shareholders. Therefore, It allows us to have individual subscription strategy for each of our segments that is tailored to their specific characteristics. As a result, transition is differently far advanced in our four segments. For example, migration of our media segment is already completed for quite some time with a subscription revenue share around 59%. Managed segment is also well advanced, with a share of around 50% of subscription sales revenue. City segment has a structurally higher share of services and hardware revenues. We are also in the final phase of the transition here. The build segment, we completed the highly successful subscription transition at our Bluebeam brand at the end of 2024 and reached the promised subscription share of 19% at our largest brand within the Nemechek Group. The transition in the build segment was further supported by the acquisition of GoCanvas, which is already operating on a fully SaaS-based business model. Overall, at the end of last year, the segment was almost entirely based on recurring revenue, with a share of 59% as well, with the most of revenue coming from subscriptions and SaaS models. To give us the design segment, where we have now also a high portion of recurring revenues at around 80%.

In addition,

who will significantly accelerate the segment's transition to subscription and sales models in 2025, the ongoing and already well-advanced transition of Vectorworks. Docs also, beginning of this year, selling perpetual licenses for new customers at Rakisoft, and existing customers have until the end of this year to buy a perpetual license. Our plan is also accelerating this migration to subscription business models. While we will feel the temporary accounting-related impact at the individual brand level in the design segment, the impact segment, and especially at group level, will, however, be very digestible. So, I believe it's fair to say that Nemetech continues to be one of the very few companies that is able to show an attractive top-line growth combining with a high profitability while transitioning to a subscription SaaS-centric business model. And with that, I hand it over to you, Louise.

Thank you, and a warm welcome to our earnings call for the financial year 2024 from my side as well. Well, you have already touched on some of our key financial figures, so I would therefore now like to look a bit more in detail at the most important financial aspects of the fourth quarter and, of course, also of the full year 2024, as well as also on the underlying growth. As usual, begin with a short overview of the last quarter on page number nine. And all in all, I really think it's fair to say that that we had an exceptionally good end of the year with a very strong growth and continued high profitability. And as we will see in our segment overview in a few minutes, the strong Q4 was mainly driven by a strong development in our design and sales segments. In line with our strategic priority on transition to a subscription and SaaS-centric business model, our reported annual recurring revenue, which includes the contribution from our book canvas acquisitions, recorded an increase of 41.9%. However, even if we strip out this M&A contribution of GoCanvas, the ARR growth remained at a high level with a plus of almost 35%. And as you all know, this continued strong increase in ARR is an important indicator for the group's revenue and cash flow growth potential in the coming 12 months. The main growth driver was once again the revenue from our subscription and SaaS models, which grew organically by 87.6%. Including the additional revenue contribution of GoCanva to this KPI, which is already running on a fully SaaS-based business model, as you heard from me, the growth even reached an impressive 102%. And thanks to this strong growth in our recurring revenue base, we were able to substantially increase our organic revenues in Q4 by 26.2%, despite the unchanged, challenging economic environment in our end markets, as well as our ongoing subscription and SaaS transition and the associated short-term accounting-related impacts on our financial results thereof. including the contribution of Bocamba, the reported revenues for the month from October to December increased by 32.5% to 290.9 million euros. Our EBTA for the quarter increased, despite our ongoing investment into the future growth of our business, by 37.4% to 95.1 million euros. The corresponding EBTA margin reached 32.7% in the fourth quarter. If we adjust for the currency's still lower profitability of GoCanvas, along with the average related revenue haircut, our organic EVPA for the quarter reached 34.1%. The acquisition of GoCanvas and its related effects, such as the increase in amortization charges and interest expenses for the financing of the deal, resulted in an underproportional EPS increase of 96% compared to our very much higher top-line and EVPA levels. We continue with an overview of our full year 2024 results on page number 10. And here, I would like to underline each assessment that we had a very successful financial year 2024 with a continued strong and profitable growth. And this is especially encouraging given our ongoing transition to a subscription and staff-centric business model and the associated short-term accounting burden on our financial results during this time. and also given the continuous challenging environment in our European design markets. We have already touched on the key revenue and profitability figures for the financial 2024, so I would therefore like to focus on the right-hand side of the slide, where you can see important balance sheet metrics, such as the equity ratio, which is at 44.2%, as well as the net debt position of 295 million euros, that show the natural and intended increase in debt as a result of the GoCanvas acquisition and the financing thereof. And all in a very healthy balance sheet. If we look at the development of these KPIs on a quarter-on-quarter basis, though, you will see that thanks to our continued very strong cash generation, which is at almost 102%, Net debt position has already improved by 75 million versus the end of Q3. And similarly, the equity ratio has improved by more than 500 basis points. On page 11, you will find the developments of our four segments during the financial year 2024. Let's start from the left with our largest segment, design. We see a strong revenue growth of 13.1% to almost 489 million euros. In particular, the fourth quarter showed a significant acceleration in growth, with a plus of 27.1%, and by a very strong business performance at the year-end. The last time sale of licenses to new customers, as well as successful campaigns to migrate existing maintenance customers to subscription contracts at Gratisoft, contributed strongly to this growth. And the EBITDA margin for our design segment for the financial year 2024 expanded despite higher bonus payments and the simultaneous transition of the business to subscription and SaaS models to 29.6% versus 27.7% in the previous year. And as promised, also our build segment showed a stellar performance in the fourth quarter, which reflects our largest brand within the group, Bluebeam, was here coming out of the successfully completed transition of its business model to a subscription-centric business model. On an organic basis, revenues in Q4 for bills grew by 38.3%. If we add the contribution of GoCanva, which has consolidated in this segment since July 1st, the growth rate is almost 60% in the fourth quarter. So for the whole year, the revenue growth of the real segment, including Rocamla, amounted to an impressive 28.4%. However, the segment also recorded a strong organic growth of 18%. The routine margin reached 31.8%, mainly here due to the delusive effect of Rocamla, and also the continued investments into the future growth of this strongly growing segment, and Bluebeam's subscription transition. Our smaller segment managed, which accounts for 5% of the group's revenue, was slightly inclined of 1.5% in the financial year 2024. However, the segment's growth was partially negatively impacted by the discontinuation of a low-margin advisory service unit that we disposed of, despite the continued Investment into the segment's product portfolio, as well as investment into future growth opportunities, the margin expanded markedly to 10.2% from just 3.6% last year. And finally, in our media segments. Revenues grew by 7.8% to €120.1 million in 2024. The maximum run, therefore, again grew faster than the underlying market, although its business was still impacted by the ongoing restrained demand environment in the important U.S. market. The EBITDA margin in the media segment remained at a high level and reached 35.7%. As we outlined at the beginning of this presentation, the continued internationalization of our business remains one of our key strategic priorities. On slide number 12, we can clearly see that we have successfully strengthened and expanded our international presence during the course of 2024 as well. And looking at our regional revenue development, our business outside of Europe, which includes the Americas region at 24% growth, and the Asia-Pacific region at 28% year-on-year growth. These were the strongest growth drivers over the last 12 months. In the Americas region, the important U.S. market continued to benefit from ongoing good market conditions and continued to be our main growth driver in this region. Additionally, of course, our growth in the region was further supported by the GoCanada acquisition. With currently 10% of our group revenue, Asia-Pacific remains the key focus region for future expansion. In 2024, the region continued to enjoy a continued good-to-demand environment and offers a huge potential in markets such as India. And then to Europe, which still accounts for 49% of our group revenue, we continue to navigate the partially talenting markets in the design segment. And while we only recorded a growth of 2.8% in our domestic markets here in Germany, the growth in Europe outside of Germany was very promising and significantly stronger at 14.7%. This growth was supported by a strong performance in our build segment in Europe, particularly from Libyan, and a good development in our media segment as well. Our internationalization strategy and the ongoing diversification of our global presence are paying off. and we will remain committed to strengthening our position in key markets while seizing new growth opportunities. Now I turn to what is one of the most important strategic priorities for us here at the Energy Group on page 13, our highly successful transition to a subscription and SaaS-centric business model. And as you can see on the right-hand side, we once again delivered exceptional growth in recurring revenues in Q4. Our annual recurring revenue, ARR, grew on a reported basis by 41.9% and on an organic basis by 34.6% year-over-year, demonstrating the strong momentum of our subscription and SaaS transition. Excluding maintenance contracts, which is also included in this category, the underlying subscription and SaaS growth is even higher with more than 100% growth on a reported basis. At the same time, and as expected, license revenues declined by 10.8% year-over-year, in line with our strategy and the continued shift from perpetual licenses to a subscription model. On the left-hand side of this slide, we highlight the longer-term impact of this transformation. Curving revenues now represent 87% of our total revenue base, a new record high for the Nemesis Group. And looking at the chart, it becomes very clear what is driving this strong performance, and that is our systematic execution of the subscription first strategy. Ever since 2020, we have an almost six-fold increase of our subscription and sales revenue base, achieving an outstanding compound annual growth rate of over 50%. This strong trajectory underscores the resilience, the predictability, and the long-term value creation of our business model. And we are fully focused on continuing this successful transformation, further strengthening our recurring revenue streams, and driving sustainable, profitable growth. To conclude our review of the results for the financial year 2024, we provide a more comprehensive overview of our TP&M and cash flow items on page number 14. As we have already addressed, reported, as well as our organic revenue, ARR, and EBTA development in detail, I'd like us to look further down the P&L. You'll see that the impact from the largest acquisition in the company's history, being the canvas, is also reflected in the reported development of the various categories. For example, if we take a closer look of what is by far the largest driver of our cost base, our personnel cost, you will see a year-on-year increase of 12.5%. However, if you analyze the main components of this growth, you will see that after the very modest increase of just 3.8% in the first half of the year, personnel costs grew sharply by around 20% in the second half of the year. And, as one would expect, the higher growth rate is the effect of the more than 300 additional GoCanvas employees who joined the Nemetic Group on July 1, 2024. If we were to strip out this additional cost, the underlying organic growth in personnel costs is significantly lower, and more in line with previous years underlying the continuous focus we keep on our cost base. In addition, we have also already mentioned the M&A-related reasons for the underproportionate increase in EPS, in particular the additional amortization charges, as well as interest expenses as a result of the GoCampus acquisition. As we have communicated before, we initially financed School Canvas with just over 600 million euros, a large portion of the purchase price with new debt through a revolving credit facility, as well as the bridge loan. In the fourth quarter, we re-financed this original bridge loan by issuing the first provisional note, the German short time in the METX history. We are proud to report that the Shul Shan was met with very high demand from domestic and foreign investors and was highly oversubscribed. The resulting successful placement of the transaction at the attractive conditions at the very lower end of the marketing range once again confirms the great confidence investors have in our strong business model and our solid financial position and in our future prospects. Looking at important balance sheet metrics, as the equity ratio of 44% or the net debt to the day ratio of only around one time, I think it's safe to say that Nemetschek still maintains a very solid balance sheet, also after the Gotenbach acquisition. And in addition, Thanks to our aforementioned strong operational performance, as well as very strong customer generation capability, we are able to continue to very quickly deliver and recreate a substantial leverage headroom for further potential M&A activities, as well as investments in highly innovative startups. And with that, I'll hand it back to you, Luis.

Thank you very much, Louise. We have provided a very good overview of the underlying drivers that have enabled us to achieve or significantly exceed all of our targets in 2024. And it is also clear that our targets for 2025 will be even more ambitious in light of our very strong performance last year and the before substantially higher comparison base. But before we come to the end of our presentation with our outlook for the financial year 2025, let me briefly highlight on slide number 16 why we are still so confident with our ambitious goals in 2025 and beyond as well. In short, the strength of our underlying operational business, which became even more diversified and such resilience in the recent years. Recently, there has been a lot of discussion about the impacts from geopolitical issues, global conflicts, tariffs, inflation, or a potential downturn of the global economy. And Nemesek will not be immune in the case of a global recession. I would still like to use his opportunity to highlight on page number 15 how well diversified and resilient our business has become over the last years. starting with the chart at the top. For the last year, we have already shown that our ACO segments are affected by deteriorating market conditions at different points in time. This helps us to better manage a potential downturn across our portfolio. In addition, you see that we have become less dependent on a single customer group or segment, in this case design, which today accounts only 49 persons versus 59% in 2019. The increased share of the built segment, along with our successful internationalization strategy, also resulted in a better diversified geographic exposure, or put differently, we are less dependent on a single region or country. Lastly, at this core, we have already discussed the perhaps most important development in recent years. a strong increase in the share of our recurring revenue. Along with our high customer retention rates, his revenue provides a more stable and better plannable revenue stream, even during more challenging economic conditions.

Coming to the end of our presentation on page number 17.

After our successful year 2024, we aim to continue our very attractive double-digit organic growth also in the coming years.

Further advancing also our strategy priorities.

In particular, the financial year 2025, that means that in today's perspective, the Executive Board's currency-adjusted revenue growth of the Nemechek Group including GoCanvas, in a range between 17 and 19%. This includes an M&A-related revenue contribution from the acquisition of GoCanvas of around 350 basis points. The APTA margin for the Nemetech Group, including the derivative effects of GoCanvas, is expected to be around 31%. Please note Keep in mind that these figures do not yet reflect the full potential of their GoCanvas acquisition, as both the revenue and EBITDA contribution in the first half of 2025 are still reduced due to the IFRS-related purchase price allocation. Based on our strong fundamentals, and despite these years' higher comparison base, the ongoing subscription class conditions of our business model as well as the continued challenging market conditions to continue our growth path with a very attractive strong growth at a high profitability in 2025 as well. And with that, I would like to thank you for your attention, and we are now happy to take your questions. Operator, please back to you.

Thank you. Ladies and gentlemen, if you would like to ask a question, please press 9 and the star key on your telephone keypad. In case you wish to withdraw your question, please press 3 and star.

Please press 9 and star to register for a question. And first up,

It is George Rex from Modern Stanley. Over to you.

Good afternoon, Yves and Louise. A few questions from my side, please. Firstly, from the demand environment, and this is really touching on two areas. I guess on the one hand, you called out the U.S. overall market demand conditions as being pretty good. In fact, if I look at the U.S., Our central billings index, the February read yesterday was quite soft. Recent readings overall have been in contractionary territory. So I guess if you can contextualize how you're seeing the market versus, I guess, some of those other indicators out there. Secondly, regarding the German infrastructure spending fund, if you've got any early thoughts from your side around how that may benefit your business over time, those would be interesting. And then lastly... Can you share how you're thinking about organic growth seasonality this year? And I'm thinking about it in a couple of areas. Firstly, whether you've seen any evidence in Q1 of demand having pulled forward into Q4. And then secondly, bearing in mind that kind of tough comparable base you've got in the fourth quarter of 2025. Thank you.

Thank you, George. So, first of all, if you look at the market conditions, clearly, of course, there are a lot of potential changes coming up, but So far, we do not see many changes in Q1 2025 versus 2024. And our expectation, our planning, how we are currently foreseeing and forecasting our business and planning our business, that we do not expect 2025 to be much better or much worse than 2024 regarding the market conditions both our industry's ACO software and the medium entertainment and 3D animation software. Obviously, if you look now at the different dynamics, there are still agitation in Europe. I mean, especially there are still prolonged sales cycle in design markets here in Germany, in continental Europe, clearly. Then if you look at all different sub-verticals, You know, if you look at residential markets, still the same. So new build is still difficult, not only in Europe, but clearly also in the U.S. Innovation is doing still okay. If you look at commercial, new build is also difficult here, especially, again, in Europe and U.S., but it depends on the sector because clearly data center, manufacturing, are doing fine, and office and retail are more difficult. And also here on commercial, good business around renovation. And the public sector in general is still quite resilient, as we may have seen over the last two years. But as you know also, somehow the ACO industry is benefiting clearly from all the challenges that our end customers have. because they still have a lot of delays and over budget in terms of their projects. You know, a lot of material are still wasted, and with the potential tariff impact on material, especially in the US, this is clearly a push to do something to make sure that they are not going to continue to waste so much material during a construction project. And last but not least, if you look at the lack of manpower, so we were talking about 7 million a lack of 10 million workers globally in the U.S. And then if you look at the average age of construction workers, 42% of the current workers average globally, their average age is around 55 today. And then if you look at the U.S. issue regarding manpower in construction, 26% of the current workers in North America, or in the U.S. in particular, are immigrants. So clearly, there is a huge even push and demand that there is a wake-up call for everybody in the construction industry, including small and medium business, that business as usual is not an option anymore, and therefore, we should be still helping with a strong demand of digitalization for the overall workflow and design planning, build and construct. But of course, if you look at energy efficiency, also in the operator management. And George, now going to the second question, which is regarding Germany and what potential, in fact, his new debt package could happen. Well, first of all, I think it's too early to tell when and how exactly it will affect demand in Germany. There will be potential positive effects, of course, with additional investments, with long-term financing, security, etc. Of course, in general, there could be also potential negative effects with the currently higher interest rates, which is, of course, bad for construction, and there are still a lot of regulations, bureaucracies, that need to be fixed. But the lack of labor is also still here in Germany, which is also helping the fact that there is a strong demand for decentralization. So, also, it may take a long time until, you know, the money arrives from all of these projects. But overall, of course, what's currently going to happen in Germany will have a positive effect, for sure. Now, the question is, when exactly? Then, talking through your third question about, you know, the ongoing organic growth and demand for 2025, and especially issue one. Yes. We have, you heard, a very, very strong Q4, especially the last few weeks of December were extremely strong in design, but also in build in particular. And, yeah, you may say a good point. Is this a put forward and for Q1? And are you going to have a weaker Q1? Good news is no. I think clearly the demand is still highly strong, especially if you look at build demand. The number of new seats is going still at the same strength. New seats not only in North America, but also more and more internationally. I can say that clearly Europe is doing very well for Bluebeam, especially here in France and Germany. And then, if you look at Q4 2025, yes, of course, you will have a higher comparison base. So that's why there will be some volatility if you look at our seasonality of performance, especially in terms of pure accounting revenue growth between Q1, Q2, Q3, and Q4, a bit different between H1 and H2. Why? I mean, the main reason is, first of all, the fact that due to the blue beam low comparison basis that we have in H1 2024, H1 2025 is going to be still very strong in the build segment in terms of revenue growth. Especially Q1, it will not be as strong as in Q4, but still stronger than what it should be normalized. Q2 will be still very strong, but less strong than in Q1, and then H2 will be much more normalized for the build segment. And if you look at design, yes, there will be also a kind of a roller coaster. Because we are in the middle of subscription moves. Brands, as you know, have performed already quite well the move to subscription in terms of uses, especially Vectorworks. in the beginning of last year, all the UCs for existing and new customers at Vectorworks are only on subscription. The only country where we still are selling perpetual license for Vectorworks is in Japan. And then if you look at the Graphisoft, as you know, we stopped completely selling perpetual license for new customers at the beginning of this year. That's why we had a bump also in December of perpetual sale at Graphisoft. RafiSoft is still continuing to sell perpetual license in 2025 for existing customers, but we will stop that beginning of next year. And then we are planning to have a price increase of perpetual license at RafiSoft on April 1st, excluding Germany, and then on July 1st in the German-speaking countries. So, there should be also kind of a good level of demand for the license in March in particular for Archicad and Microsoft this quarter. Then, what is going to be bumpy is clearly the fact that we are doing some special campaigns on the move from maintenance SSA to subscription in our design brand, especially at Outline and Graphisoft. Vectorworks, we start up a bit more aggressively also by Q3 or end of Q2 year. What we are doing there is that we are pushing existing customers to go toward a subscription by offering them a good price first of all, so usually same price as maintenance to go to subscription and then we offer some goodies which are usually features which are only available via subscription, such as cloud features, like vMix, for example, if you look at Archicad, or potentially also some new AI features, to really push them to go to subscription so that they can see the added value of going to subscription, that it's not just a price change, but clearly that there are new features which are going to be highly beneficial then to become an augmented architecture. Overall, due to that, when you have renewals of SSA contracts, it's usually in December, so there will be kind of a bump of the move from SSA to subscription clearly in Q4. But then also in June, usually there is kind of this bump. But the performance of the design division over quarter will be kind of a roller coaster due mainly to the accounting effects.

I hope I answered your questions all.

That's really helpful. Thanks for sharing those thought sheets and good luck to you.

Thank you. Next up is Alice Tremings from Barclays. Over to you.

Hi, good afternoon. Thank you for the presentation and thank you for taking my questions. I'm not expecting you to provide any specific guidance and I know you said in the presentation about double-digit growth in the coming years. But I was just wondering, on a high level, how would you frame the outlook for revenue growth beyond this year, so looking into 2026? And how do you think about prioritising margin improvements versus growth going forward? And then just the second question is on your hiring and cost plans for this year. Any specific plans that you can talk to? And do you intend on using the revenue acceleration to step up investments and what sort of margin expansion can we expect kind of beyond this year? Thank you.

So clearly, regarding revenue forecast for the coming year, of course, I'm not going to guide now on 2016 and beyond, but clearly, we strongly foresee that we have a very attractive double-digit growth potential in the coming years. clearly with a very attractive average mid-teens growth in the coming year. The average mid-teens is there. Of course, it's an average, but we can foresee, and still in a high profitable way. How the margin will evolve, obviously, we still want to invest. You should not expect, shouldn't we, that next year, you know, there will be a huge margin expansion. Of course, over time, we are going to be more efficient and it will come. But we still need to invest, especially within the next few years, first of all, in innovation, AI, cloud features, etc., We need to innovate in our business enablement, which is to harmonize all our processes, especially if you look at harmonizing IT, accounting, finance. We have been already a long way, but still some way to go, et cetera. And then, of course, investment in go-to-market, especially if you look at internationalization. We want to invest much more in regions where we have very small presence, especially in Asia, especially in the Middle East, And also, you know, the market. So we want to invest. We want to focus mainly on growth. So, of course, to answer your last question on our hiring cost plan, I mean, as always, Nemesha Group, we are very powerful on our cost base. We are doing that very diligently. As you know, we have also lower-cost type of R&D centers like Nemetschek India, but also in Hungary, in Czech Republic, in Slovakia. We have also in Bulgaria, etc. That doesn't mean that we are only hiring... L&D resources and engineers in these areas, of course, also in Western markets and in the U.S., etc. But we are balancing more and more, and we are much more careful over the last couple of years in our hiring cost plan.

Yeah, and I think maybe to add a little bit just to that, Alice, as well, is that, I mean, as it was said, we truly believe that the strongest value generation possibility for the MSE group is really the very, very strong revenue growth that we see in all the opportunities out there. And we will do so while keeping a very, very attractive margin. As you can see, we have guided around 31% EDK margins, despite the dilutive effects that we've seen in 2025 by the glucanide acquisition. And we will always keep this very attractive margin, but of course, we will create more and more head grooves. to invest into that group, but we would be able to self-fund that by the leverage of the hedge group that we create by improved operational excellence, as is alluded to. And that's something that we invest a lot into new products, future AI, et cetera, innovation. But, of course, we harmonize and we have the potential when we harmonize on the operational excellence on combined systems and also resources. You will, of course, in 2025 also see the full year effect of the GoCanvas acquisition. I just alluded to that before, the half-year effect. Of course, it drives also the impact on our total workforce, but also our total personnel cost. But these are also great colleagues that we have added to the business. And we have a very, I would say, balanced base how we can also reallocate resources in the group, how we are joining forces on quite a few things. And that's why we can continue to create that headroom that we reinvest in purposes growth.

Okay, thank you.

And the next question comes from Knut Waller from the Barber Bank. Over to you.

Yeah, hi. Thanks for taking my questions.

Just a couple. First, on getting a better feeling for Digital Twin and India. You invested last year. So what should we expect and when from these investments also in terms of revenues? Is it fair to assume that particularly that you're hoping to get some tailwind from these new initiatives in the fourth quarter when you're running against the tough comms? Then secondly, on GoCanvas, Can you give us an update here on the integration and how far you are advanced now? It's also coming up with joint offerings to the market. Where are we here? And then just a small housekeeping question for Luis. On the advisory service unit, can you just give some idea about the size of the business?

Thanks very much. Hi, Luke.

So, thank you. First of all, it's on India and between. So, First of all, Gtwin, so as you know, we launched really commercially this product kind of over a year ago. We have been successful of proving with some customers what is the ROI, so especially large logistics centers, seaports, airports, so large complex buildings. Today, it is true that in terms of revenue, it is still very marginal. just at the beginning. And it's a little bit the same with any new technology. As you know, digital trim in the construction industry is fairly new compared to manufacturing or aerospace, aeronautics, etc. Of course, digital trim is depending on how you define it. It can mean different things depending on how you use it. But all open data digital installation is really focusing on combining historical data with live data with sensor, really focusing on the operator managed A, and focusing on two main use cases, predictive maintenance, and managing efficiency use cases. For the moment, still low, it will be still very low in terms of the contribution of the revenue in 2025, and let's see what the future will bring. India, clearly here we see big potential for the future. As I said, it is the third largest construction market in the world. We opened our office really in summer 2024. It's not even a bit more than a couple of quarters now that we have this office open, so it's also going to be marginal in terms of revenue. Clearly here it's investments. The good news is that, as you may know, we tested also with Namecheck India to sell bundles with suite of products and packages. So, for example, you have a Namecheck design suite combining Libre with Bluebeam and Archicad, etc. And this is a way also for us to test this type of bundling and packages potentially for all the markets because this is something that we have never done before as Nemetschek. As Nemetschek, so it's not one of our brands going directly to India, which is normally the case and the go-to-market model of our business. They open their own offices and we also have a way to test it and so far we are We see that it's successful because we are going there with our Nemetech brand. And third, you know, you can have the best product on the world, the best marketing on the world. If all the students and people going out from school, the only thing they know is about your competition, you're not going to be successful. So that's why we are investing quite a lot on Nemetech. academia, on education, on doing partnerships, memorandum of understanding with large universities and schools in India, to first of all educate the students on how, you know, they can use digitalization, have the overall life cycle of construction to be more efficient, productive, and sustainable, and of course, de facto, to also offer free of charge of our products so that they can learn how to use, in particular, Rafisoft, Archicad, Alplan, SDS2, Bluebeam, Solibri, Vectorworks, etc. Therefore, for the moment, you should not expect a huge number in 2025 coming from there, but we need to prepare and still be very resilient. Especially in India, as you know, it's a market where you have to be very resilient. You should not look necessarily at the short-term return. Of course, I will not say that I'm a very patient person, but clearly you have to be resilient and that's my experience in my previous professional life for India and then if you're resilient, if you invest, if you really make the right dedication with the right people and at all the levels, including the public sector, it's going to be highly successful over time. Go Canvas. GoCanvas here, the integration is going as planned, so we are very pleased. Of course, we have always ECAP integration, but clearly, I must say that now after eight months, it's going as planned. We have very, very strong also leaders there, and some of these leaders also got promoted, like, for example, The head of marketing of GoCanvas is now the chief marketing officer for the full build division, including Bluebeam and GoCanvas, for example. But in the go-to-market side, we have made also very good progress. Louise and I, we were beginning of this year also at the Bluebeam customer event and the Bluebeam channel partner event. And here I can tell you that GoCanvas was very, very, very well received by also the very large Autodesk resellers. And by the way, some of them already committed now to sell GoCanvas in North America and potentially also in other regions. So that just alone is already a strong commitment from these very, very large moving who are also Autodesk's largest resellers. And then, you know, we have GoCanvas selling Bluebeam, so clearly that's very interesting because they have a good, strong inside sales team and direct sales team, GoCanvas. And interestingly, when they target, mainly their customer target base is SME, or small-medium businesses, like for Bluebeam, which is Longtail. And usually when they approach a customer, what we have seen already during the due diligence is that These customers are, so usually you talk to the owner, and they are just at the start of really accelerating digitalization. And usually at the same time that they are looking at both canvas, they are also looking at moving. So the cross-selling piece is really starting to fly, and we are very pleased for that. Of course, it's still early stage, but very, very positive sign. We are very happy.

Yeah, and maybe I take them the last question with you.

And yeah, maybe I just add also to Gokhan, that also on the GNA side, also, for example, in the finance team, et cetera, they're also very successful in the integration, working well together, which worked out quite fine also through the financial audit. We are in closing despite the short term, so we're very happy there as well. And as to manage your questions, the housekeeping question as to the business that we disposed of, I would say it's in the low single-digit million area, and without this, the growth of the managed segment would have been slightly positive.

Great. Thank you, Yves and Louise.

Thank you, and we're coming to the next question from Victor Tran from the Bank of America.

Hi, thanks for taking my questions and congrats on the solid successful quarter.

I guess first of all, if we look at design, it seems like it's following a similar model on transitioning to subscription similar to Bluebeam, and if I remember Bluebeam I think you move people to subscription on maintenance pricing as well and then kind of roughly do a 10% increase every year. Is that a similar path that you're taking in terms of that magnitude of increase every year in design? And then secondly, can you quantify maybe the impact you see in Q4 with the license pull forward? And just thinking about that as well, I suppose that's mostly for new customers in Graphisoft. So the question is, what's the mix of license sales that are to new customers versus existing customers? So presumably would be a similar bump as well Q4 this year?

So first of all, thank you Victor.

And in the design Each brand has a completely different strategy and sometimes even from different markets, we have also a different strategy. So it's not at all the same exact model as for Bluebeam. In some cases, they are already doing an SSA price increase. For example, to start with, if you look at Vectorworks, And then only after they are doing price increase of maintenance, then they are starting to move then to subscription without automatically a big increase automatic every year. That's, for example, one of the Vectorworks models. Then you have another model where you have just SSA customers moving to subscription, for example, with Alplan, and then they have some price increase, but which may come in the future, but to start with no price increase, and it's not committed that there will be automatically a price increase in the future. Of course, that's the goal. It's not like, you know, for sure, you know, I think there will be a price increase, etc. Then, in some other cases, but that's very small cases, in particular campaigns, there are also some three-year offering where we offer customers to go from, say, maintenance to subscription. So a couple of brands are offering that, and especially, I mean, it's mainly Graphisoft offering that. And they did that with a three-year package where now, if you sign up for that, you will have a very, very small price increase over the three years. which will be very indexed sometimes to inflation or something like that. Or in some other cases, depending also on the size of the customer, there could be a negotiation that for three years there is no price increase at all just to motivate them to move to subscription. So, therefore, you know, very different for all of different brands. It's not one strategy at all and very different than Rubin. Then, if We talk about end of last year, what happened in design. Clearly here, very strong quarter yet for the design division, but yes, a good part was coming from paper to license, but frankly, it was a lot of strong growth coming from new teams. And the pre-buying effect, the license for existing customers will end in Q4 2025, and it should be much smaller than what happened in Q4 2024. In fact, I mean, then if you look, for example, at Alplan. Alplan is selling perpetual license for some of their products. but they are still selling perpetual license. And if you look at last year, 80% of the uses existing on new customers, they are all subscription. And frankly, today, and even in issue one now, if you look at design, without exposing too much, because the quarter is not done anyway, our performance on subscription has been better than expected, the performance on perpetual license, as of today, has been slightly below what we expected, but look, we still have a few days to come, and usually, this big peak of perpetual license are really coming quite late in the quarter, as we are going to have this pricing freeze on April 1st. So, there could be some positive surprise there, but clearly, in general, when you talk to customers, when you talk to resellers, they have really a tendency that, okay, now it's really normal. The normal business way, even for existing customers, now when they want to go with new seats, they go subscription. Also because they have the food packets that they want to have with BMIX, for example, with the AI features, which are not necessarily there when, which are not there when they send a perpetual license. So, clearly, you have a lack of functionality when you buy a perpetual license versus subscription. That's why, you know, the demand is

much smaller than it used to be. Super clear. Thank you. Thanks, Victor.

The next up is Joe George from JP Morgan.

Yeah. Hi, guys.

Thanks very much for taking my questions. A couple for me, please. The first one is just a clarification question, please. On the design division, you mentioned the acceleration in the subscription transition, particularly within Graphisoft and the old plan through 2025. Just to clarify, is this an incremental acceleration in the pace of the transition, or is this in line with the previous plan? And then one question just on the recently launched AI functionalities you touched on in the prepared remarks. Can you just give us an update here around pricing of these functionalities and any impact that they're having on monetization and upsell rates as well. Thank you.

So, in design, the acceleration that we are doing on subscriptions, first of all, some brands are stopping completely to sell perpetual license, as I said. They are stopping for new customers beginning of this year, and beginning of next year, or for existing customers, or Vectorworks stopped completely selling perpetual license beginning of last year. Only in Japan, they still have some perpetual license, and they will stop. They didn't announce it in the coming quarters, also in Japan. Clearly, it is incremental, this acceleration. And also now, we are also pushing existing customers to go from maintenance to subscription. The push, of course, we are doing that in a careful way, so it's not like mandatory. If you don't move to subscription, then you lose everything. It's case by case. In some cases, yes, a bit more mandatory than others, but in general, we are trying to do that in a very smooth way. But the campaigns are there. We really started big campaigns in Q4 at Gratisoft and Alplan, continuing now. As I said, Vectorworks will also do a stronger campaign on migration from maintenance to subscription of existing customers in the beginning of Q3 and end of Q2 of this year. Yes, it is incremental to that duration. Then, regarding AI. AI features, there are a few of them. Of course, there is the AI Visualizer, which we launched last year with multiple design brands. These are different ordering tools. So here, this is a way for architects to first of all do quick sketching. Then also with the AI visualizer, they are able to automate a quicker few tasks. For example, if you have your 3D model, you may say, okay, please add five floors or add two balconies for any two-bedroom apartment. And I want the north face to be in red bricks and the rest in wood in terms of walls. And then all of that happens immediately as an example. So of course, all of that It's interesting. I mean, for customers, most of our customers are defining themselves as creative people, especially architects, but also if you look at artists with Maxon. And therefore, we want to be very careful how we position AI, and therefore we are doing it in an ethical and trustworthy way. It means that we are helping our customers to become an augmented architect or augmented engineer, etc., And AI is not there to replace them, but more to help them to automate more repetitive tasks and all of that. Yes, there is an interest for them to use more AI. Yes, the plan, especially as we are going to add more AI functionality, so we are planning to launch in Q3, and we will have kind of an MVP already in Q2. He's an AI assistant. We already demonstrated his AI new assistant at BAO 2025, here in January, in minutes, his large construction show. And his AI assistant would be first launched with Archicad at Raffisos and then with Alplan. And what is his AI assistant? It's really a way to really enhance significantly the user experience so that they are able to to use also in a much easier way different features, that it will also help them to enhance some automation that they were not able to do before, etc., etc., and much easier to use also a product. Now, of course, all of that, what we are doing is that when you have AI on the monetization, we are trying to put AI features, like Bluebeam will also launch new AI features in the coming quarter, where it will be more present in packages. So it's not like it's necessary in all the basic packages. We may do it to influence some perpetual license maintenance customers to move to subscription, but in general, as soon as you have good ROI type of AI features, they are definitely in the premium package. And we are also planning with some of them to potentially sell them standalone if the ROI is very strong. So when you look at recent studies, AI features usage with architects in general is still low. That's not only for dynamic tech products. I'm calling about the industry market study. I mean, we are clearly below the 10% of the usage. Why? First of all, because some of these architecture firms are small architecture firms. We are talking sometimes about 2%, 3%, 4%. Some of them, you know, they were still using 2D, and they are just starting to use 3D autoring tools just to show a 3D model because their customer is asking, oh, I don't want to do just a 2D AutoCAD and a PDF map or whatever, a plan, I want to see now a 3D model. They are not even using the full beam functionalities. AI is even, for some of them, more complex. But I think over time, clearly, The usage of AI will definitely increase, especially as they will see that it is clearly helping them to be much more productive. And it is helping them to be more productive already today. We have already some highly positive feedback from the people using this AI feature because they can see that in terms of automation of efficiency stats, etc., it is there. And more to come.

Great. Thank you.

Super helpful. And if I could just have one follow-up, just on the growth rates within the build division, you touched on it slightly before, and I'm not expecting any explicit guidance here, but could you just give us your thoughts on how we should think about the trajectory of a normalized organic growth rate within the division as it emerges from the transition, and particularly after GoCampus is fully integrated versus the currently elevated levels just now? Thanks.

I think clearly for 2025, we are expecting the build division to be at 20% plus revenue growth. Then, of course, it will normalize, and we are expecting this growth to be from the mid to high teens type of revenue growth for build for time.

Perfect. Thanks very much, guys.

And the next question is coming from 909. Hello, hi, thank you for taking my question.

I've got two please. The first one is on the 2025 guide. I think you mentioned, you touched on how the macro outlook for 2025, we're not expecting that to change materially from what we had in 24. But then again, if we look at the midpoint of your 25 guide, you're expecting organic, constant, healthy, healthy.

We cannot hear you any longer? We may, we lost you. We cannot hear you. Oh, hello.

Can you still hear me?

Yes, we can hear you.

Okay. I'm just asking, you know, in what areas of the business you're expecting to do better in 25 to see that acceleration in top-line growth in the year? And then the second question, maybe one for you, Louise, is the cash conversion highlighted, you know, very, very strong in 24, particularly in Q4 as well. I just want to understand if there are any timing effects or one-off items in there that we should be aware of and what sort of cash conversion rates we should expect going forward?

Okay, so clearly for the 2025 guidance, as I said before, and as you all realize, we have a slightly, yes, definitely higher comparable. But despite that, we are still highly confident that we are going to reach our guidance also with the current start of the year, which has been good in January and February, and so far also good in March. or to be in the 17 to 19% revenue growth, including GoCanvas for 2025. Clearly, are there better areas than last year? Is there any acceleration in some area? I mean, frankly, we cannot say. Yes, build is getting strong and even in some areas stronger. I think clearly GoCanvas and the combination of GoCanvas and Bluebeam is healthy, clearly healthy. We have very, very strong demand on both Bluebeam and GoCanvas, which is going in the right direction. On design, I would not say it's better. I mean, clearly not. I mean, it's okay. It is as we were planned, but the market conditions clearly in 2025 are not going to be worse no better than in 2024. Now, of course, if there is a huge crisis and a big recession, we won't be completely immune either, but on the other side, even if the construction industry is now exploding, well, I'm not sure that we are going to follow the explosion because, again, as I said, the fact that the construction industry is also facing challenges is helping the AEC software industry to grow because markets realizing that business as usual is not an option for them any longer. So that's why digitalization growth and penetration of digitalization is somehow increasing thanks also to the current crisis in the construction industry in the last few years.

And let me take the second one as to the cash conversion, and you're absolutely right. You had a very strong, continuous strong cash conversion, as you could see, also in 2024 and also in the Q4. There were no special one-off effects there. Of course, the better business performance, very, very strong, especially in December, of course, that adds to that in Q4, but no sustained one-offs in that respect that you should pay special attention to. And that's also going forward. I mean, the very, very strong cash conversion is really inherent in our business model, especially in the business model of the subscription and sales-based business model. So you should also expect that to be above one in the future as long as we are growing. Because, of course, also the subscription models are prepayment models to stay in that respect. That's why you have a little bit of higher... deferred revenues and you have the higher cash conversion there. So you should continue to expect that to stay on an equal basis with what you had and no special one-offs. But of course, stronger business growth will also help us even stronger on the cash conversion.

Very helpful. Thank you very much, folks. And next up is Nicola David from AutoPHS. Yes.

Thank you for taking my question. I have two, actually. First is regarding and the move to the install base to subscription. Do you plan to push those three year plans to block price and do you expect the same kind of positive impact on your supply? with upfront revenue attached to that, or do you think that's really something we shouldn't expect in 2025? And my second question is, regarding the margin, if my maths are right, if we flip out from one side, the negative M&A impact you had last year, and on the other side, the negative impact from the 12-month consolidation of Ocanvas, it seems that you expect an underlying organic margin improvement of almost one point, or even above one point. It looks a bit more than when you were calling for limited operating leverage, or is it one point for you in your wording, limited operating leverage? And do you think that's a bit higher than what we should expect going forward in 2027, one point of operating leverage, or is it something you could deliver all the time?

Thank you. Nicolas, thank you.

Regarding Graphisoft, so clearly, yes, we are planning to do some, to continue to specific campaign and push existing maintenance customers to move to subscription. As I said, we are doing only specific small So it's not like, you know, it's going to be forever. We are doing just that specifically for specific months or for specific quarters. In some cases, it will be also just for specific region or country and not, you know, globally, et cetera. And we will see that over time. you will see them from time to time in the next few quarters, but it's not something that we are doing massively, clearly enough, and it will be still a marginal part of the total revenue, of course, of subscription for Grafica.

And I'm not sure if I understood the question acoustically because the line was maybe not that good, but otherwise, please ask after. So on the margin side, we have a very healthy operating leverage. I think that is what you said. And in general, of course, there's a dilution in 2025 as well due to the ongoing growth of the canvas, which is to say they are lower than the limited group in general. They're still a very, very strongly growing, smaller company. But it's also the effects of the revenue haircut that you see in 2025 as well. So that is to say, slightly south of 100 basis points, 80 basis points around it. But it doesn't really make sense the longer we go into 2025 to look at it like that, because as we said before, we are integrating and we are steering the combined business, and especially on the cost side, of course, we will also make sure that you have leverage on both sides. a little bit depending on where it then lands, so to say. So we will not be as specific on that. But you should, yes, in that range, this is the approximate effect of Gokhan resolution on the margin. And we continue to have a very strong operating leverage. And, of course, as I said before, you have a much higher headroom that you have created than what you are to say. You could increase the margin more. But we are not doing that because we are reinvesting that into future growth. As I said, we think that the clear value generation is really – the clear value creation is really all those revenue growth opportunities that we have out there. So we keep it focused on the very – very attractive level of around 31%, and the rest we reinvest in everything that Yves also alluded to before, AI, new product bundles, new markets, et cetera, not only in the build area, which is feeling strongly growing, but in all our businesses, because as you can see, we have very attractive businesses. So that's the way you should think about it. I hope that answers your question.

Yes, it does. Thank you very much. Perfect. Thank you.

There are no further questions.

Wonderful. Well, thank you, everyone, for dining in and for attending. We are looking forward to catching up with you soon. If you have any follow-up questions, please contact Patrick or myself. We are happy to continue the dialogue with you. Thank you very much.

Thank you, everyone.

Thank you. Bye. Thank you.