Schindler Hldg Ag Akt

We miss you. That's how I started a year ago. Today we have a small audience here and I can tell you it's completely different to talk to real people instead of just talking to a camera. So thanks for coming. My name is Marco Knuchel. I'm heading Investor Relations at Jinde. And welcome to the 2022 full year results presentation. I'm here together with Silvio Napoli, our chairman, and with Carla De Geisler, our CFO. Silvio will start with key messages and the highlights, then he will talk about key developments in the markets, the industry, and finish with the strategic framework. After that, Carla will lead us through the results. After the presentation, there will be a Q&A as usual, and then we will finish. We aim to finish at about 11 o'clock. Silvio, please.

Thank you, Marco. Good morning, everyone. First of all, for those that kindly joined us here in person in our auditorium, which we finally can use. And also good morning to the ones that join us online from remote locations. Yes, it is a pleasure to be here to present as traditionally our annual results for the year 2022. Before we get on with the results and the I would say traditional business, I do think I wanted to say a few words about the tragedy in Turkey. Not only because we have there a large company with very courageous and remarkable employees, but also because the entity of the tragedy is difficult to fathom. I'm happy to say that Schindler is bringing its small contribution with our employees becoming volunteers, going there to help people through the rubble, releasing people in the buildings that were still standing in lifts whether schindler or not but also helping the rescue teams i again it's a small word but i thought that that was important due and legitimate so to all the people in turkey in syria affected by this tragedy we wanted to express on behalf of schindler our strongest sentiment and condolences for the lives that were tragically lost Difficult to move on from that but nonetheless that's what we have to do. So let me first start with a few key messages. One year ago it was an eventful beginning of the year because we announced a change in governance and my message was we do have some issues, we are conscious of them, we will fix them but it will take time. today my message to you is that we are progressing on fixing these issues the issues were the right one we have progressed a lot but we still need more time now Building on that, perhaps a few key messages that we will not perhaps touch on so much as we go through the different points. Markets are developing fast with new installation declining driven by China. Our order intake is such that our new installation order intake has declined on par with the market. I like to stress that point. And the decline has been offset by a robust growth in service and modernization. Our measures have started to yield benefits and results already in the second half of the year, under many fronts, sales margins, but also in terms of profitability, which you saw as correct at its trajectory in the second half of the year. we are progressing on resolving legacy issues I'll come to that in particular in terms of supply chain and in order to continue with this momentum we introduced a new strategy deployment framework which I will present later on today so again we are progressing but we still need more time before we can come out of the issues that were generated in previous years Moving on to now, perhaps the other part representation continuing with the with the highlights now here to I just we prepared here for you. I said of highlights that perhaps are less addressed in the traditional financial results, nonetheless, one that we believe. are very relevant to our business today and tomorrow first of all uh cloud connectivity you know we were the first company to start connecting units to the cloud we introduced you in the red today i'm pleased to say that in spite of all the challenges with microchip suppliers lockdowns we already have one quarter of our portfolio disconnected to the cloud That is important. I come to that because you see the next box there in green. This allows us to deploy innovative solutions and services, including the green service that I presented already when we did the Q3 results, which is really certified by TÜV, which is, again, an example of the massive opportunities that will present themselves thanks to this connectivity. Another point I wanted to stress perhaps on this page is on the right hand side top corner. It is to do with our employees. We are very pleased that we're not obsessed by those rankings, but we were in many parts of the world. ranked as top employers as based on employees surveys in switzerland we were very pleased it's very recent it was last week number two uh favored employer and i would say allow me to normally we don't brag but you know if you see companies much larger with even a much larger presence behind us that is a humbling result equally in asia pacific thanks to a joint venture uh jardine schindler in many parts that we were actually we're in the top 20 and in some of these countries we are we are we are number one and somehow the engagement survey response rate of 87 percent that we obtained in 22 is somehow a testimony to the efforts we bring around the world to engage our employees at this very crucial time in our history and of course i'm very proud of their engagement talking of employees perhaps on the bottom left corner there is our simplified leadership structure that was a key move we introduced one year ago and i'm pleased to say that one year after that was the right move at the right time we now today can move faster take faster decisions with a much less complex set of processes while at the same time staying focused on the key actions and most importantly we can adapt to changes which will come to that continue to come very fast Finally, a word on building minds. And I would say as we go forward in the year, perhaps we'll dedicate more time to that. But this startup that only has a few years of existence has already 15,000 buildings connected to the platform, 15,000. So the business concept has already been proven. Now, of course, it is still a startup. So we are now into the ramp up and scaling phase. And I look forward to sharing more of their results and performance with you all. Now, these were the highlights of 22 years. I also thought it was important to continue with what we started last year. Last year we introduced the set of key challenges that we were confronted with that led to our declining performance and every quarter we provided you with an update on how we were tackling these challenges. to continue with the process and perhaps, let me say for the last time, we thought it was important to share with you the progress on the challenges. Now, as you can tell, and I'm not going through each one of them, but we can take it in the Q&A, and please report that the progress has been substantial. Actually, in some of the challenges, we are coming to the full resolution. At the same time, there is probably one where we are the most behind, and you can see it in the chart. This is the one about regaining competitive new installation margins. And you can say, hang on a second, how come we are not more advanced? This is possibly the most crucial in terms of regaining profitability. And so allow me here for a moment to explain why this is the case once more. To do that, there are two ways, probably key drivers to improve installation margins. One is the top line by increasing prices. The other one is by taking care of efficiency and or supply chain issues. But let's start with the first lever, which is pricing. When we met one year ago, I remember I said, you may remember I said that, in fact, we were late in acknowledging the impact of inflation. And I'm pleased to say that in the year 22, our efforts throughout the world led to progress that I think we can say very openly, probably was even beyond expectations and plans in terms of regaining the upper hand in terms of pricing. and this happened throughout the world with one exception unfortunately it is the biggest market in the world it is china now clearly some of some of it has to do with their own performance i understand that some other companies express similar situations But China, a market that I know well, is indeed the most competitive, where there is still like a chronical overcapacity and, of course, a very fierce competition with all players of the world competing for a piece of the market, including some very strong local players. So there I must say we have to acknowledge in China we managed to keep flat prices. now in turn you can see on the right hand side of the chart this had an immediate impact on our sales margins and of course it's pricing plus our resolve to focus on value as opposed to volume remember we said we would stop to just focus on growth per growth per se And so you can see quarter after quarter, starting in Q2, you can see our sales margins improving. This is, of course, a very positive development. Now, of course, you may tell me, well, why doesn't this improvement come right away into your P&L? Unfortunately, this is the nature of a business. And for that, there is now the second element which we have to acknowledge, which is what I call the BOA constrictor effect. What does that mean? I mean, we are a business where you sell something and by the time you go and install it and you then generate the revenue and the profits, there is a lack of time. So this is similar to a boa constrictor. In other words, what does that mean? A boa constrictor has to digest the food it had. at the beginning before new possibly healthier food can be eaten and digested and this is a situation today and there is no way out of this so now as part of us getting to grip with the situation but also as part of us being able to present it to you uh in a clear way we now prepare the chart which was another work we really looked through order by order delivery day by delivery date platform by platform and observe what is coming for delivery when what kind of capacity in the factory deliver remember I spoke about our capacity also suffering for an element of increasing backlog and this contrast between legacy products and new orders and you see here and what does the chart tell us That before we can really get rid of the bad food, before we can get rid of the orders with a low margin, it will unfortunately take until end of 2024 to consume about 90% of this backlog. It's a lot. And so this year already we accelerated as much as we could. And you see this year in twenty two. Sorry, last year we managed to consume more than 40 percent. But now the rest is not entirely in our hands. It has to do with delivery dates. It has to do with site readiness by our customers. Some of it has been delayed. And of course, as we show this. doesn't mean it is it's not frozen first of all we are actively working against that we're going to our customers presenting variation orders trying to reprice inflation clauses a lot so that moves on a hand our goal is what to be able to get rid of that much faster the other hand there are also things which are outside of our control typically site delays by the customers or change in suppliers supply chain constraints so this is something which is in movement but to give an idea as to why there is time needed to flow through this is important to visualize this concept of the again once more abusive probably term this boa constrictor effect now this is to do with the challenges but let's now go back to the bigger picture the picture of the market and how does the market look some of you already asked me over coffee and i must say perhaps compared to one year ago the market has of course evolved and now while a year ago it was possibly pure headwinds today the headwinds persist But you also start having some signals of tailwinds. Let me start with the tailwinds first. First of all, we have the energy crisis that is stabilizing, I would say. But if you want, we can come to specific numbers, which in turn is also bringing a stabilization in raw material cost, including depending on which supplier which material decline but in some other cases will come to that even increases we see sustained pricing momentum depending on the market typically not in China and talking of China we see positive signs I'll come to that in a second but that being the biggest market in the world that has a huge influence on the overall picture Now, in terms of headwinds, besides the question on China, we see inflation continuing. That is very much there. And that, of course, affects all our value chain. We see rising capital costs as a result of the rising inflation because of interest rates, which, of course, has a huge impact on our customers, on real estate. Labor constraints, first of all, by scarcity of labor, but also by in terms of labor cost, and of course the persisting supply chain risk. So this is of a mixed picture, but clearly this is not a rosy picture. This is one that shows a market in movement. And what is, let me come back to that, the key question in terms of movement, the key question is China. And on this one here, I'd like to present again a chart that we often present. about the evolution of the real estate market in different cities. But before going into the separate charts, perhaps, what is the key message here? China, after three years of decline, still accounts for 60% of the global new installation market. So what happens in China impacts the whole world. And one of the things that we can do without China, at least in our business, I think, is not accepting reality. At the same time, China continues in a downturn, but the downturn is easing out. And that, I think, is a key message. However. even if this easing downturn continues we don't see any recovery before the second half of 2023 and now perhaps to add some data to this assessment you see here on the bottom left chart we see here the floor space sold according to city tiers the red are the tier one cities so beijing shanghai guangzhou typically and what do you see there you see there that the the floor space sold has had a recovery more pronounced in tier one in in the last quarter which is positive it is also somehow coming back in tier two and three what is equally important is the chart on the right hand side where you can see the inventory because you can see that, unfortunately, this crisis led to inventory, unused housing space, unsold, still at record levels in tier two and three. So the gray, dark and gray light. But in tier one, this inventory is declining. So this is a very positive sign, especially for us, because we tend to be, of course, with our premium brand more present in tier one cities. Why is that like this? And you can see on the right hand side, we see that the key development here is that the government has started now deploying measures to support real estate again. 22 21 22 was the period where many of the large developers actually went bankrupt they were confronted with financial difficulties which are still there and now initially the government had decided to let them somehow deal with the issue but today there is a 16-point rescue plan the famous red lines three red lines policy is being eased a bit depending on the situation and most importantly the infrastructure build-up is picking up but now whether this is the case or not and this will help i think we are in the face now that the china elevator and escalator market is transitioning towards a more modernization and service driven market and this to show that I wanted to bring these other two charts on the left hand side you see the installed base of units maintained and you can see the growth rate there if one projects to 2030 is about eight percent which is more than double the global average we show that really the China service business is literally in its almost going to say exponential growth phase Is it new? No, this is exactly the same thing that happened in Europe and the US. Except China being China today, it is much bigger in impact and much faster. And the same applies to modernization, because in China you start having now a huge population of aging units, units that are more than 15, 20 years old, which need renovation and therefore the modernization market pick up that you see there. strategically this then leads to the question how do we adapt to this transition which in itself presents huge opportunities especially for a company like us now with those headwinds and tailwinds it is key that now we develop a strategy on how to deal with that and if 2022 was the year of fixing issues the year 23 is the year to deliver and of course there is huge time pressure and therefore it's not only delivering it is delivering and accelerating And to be successful, we need discipline execution. And there is an old say that goes, whenever you feel you have no time to make a plan, then you really need a plan. And so this is exactly what we develop by in by assessing, first of all, the market, but also then by with a strategic framework. And of course, the strategy is always a result of the environment. And here, for reference, we put together what I think is important to acknowledge, which are the eight key themes that shape our industry. And now you can see, frankly, you can say, well, there is nothing new. However, it's important to understand how this goes. Yes, of course, there is fierce competition. Yes, of course, there is a DNA market declining, as we discussed, but you can see that as new things, you can see that in the existing installation and mod, there is this new China market, but also worldwide, this digital and sustainability technology that become massive differentiators. while at the same time these deficiencies are key because one cannot compete on price only and this is not something new on number four there you see that around the world the biggest pressure on maintenance for OEMs is the local service providers that compete on your price and so the pressure is there so this opportunity of what i put here as number five industry 5.0 which is the combination of digitalization and sustainability provides huge opportunities now the supply chain is 0.6 which i must admit was probably forgotten people took it for granted and now the last few years were provided a rude awakening of their importance and then of course We need people, people not only in terms of talent, managerial, functional, engineering level, but also in our case, in our industry, front line. We were saying we'll come to that which is front line is the bottom line. We need people at the front line. And today with the cultural, societal evolution, probably less people are interested to join an industry like ours. And we have to invest double up on things which are part of our tradition, apprenticeship, technical career path etc now based on this situation we came up with a response and our response is what you see here on this chart it is our strategic framework for discipline execution it is again nothing transcendental it is quite basic it starts with our purpose and what is our purpose what is a market a market is quality of life in urban environment Taking the stairs, whether you have gone shopping or not, is never a pleasant experience unless you decide to do it because you want to be fit. But whether you're in a station, an airport, I don't need to evolve, it is quality of life. Once we acknowledge that, then we define our ambition. From our ambition, we define our strategic choices. From there, we have our targets. And then those are deployed in our 4P model, people, product, performance, and planet, by having consistent priorities and execution drivers. Now, I don't think we have time today, but we can go in Q&A to discuss all the points. But perhaps I like to focus here on the central one, which is our choices. And our choices start with a key business, which is service. Our absolute priority is to create density in a maintenance portfolio. And once you define this, you also start deciding which are the new installation businesses that you want to go for. So there is the topic of margin, but also a topic of what value accrual does the bill to our portfolio is quite simple, really. But I must admit, probably over the last few years, there was a bit of a of a different focus on volume and growth per se. Equally, that applies to modernization. We will focus on modernization, on renewing our portfolio, on securing opportunity, which are also accretive to our service density portfolio so our choices here is what we do of course the most important is what we don't do so we will stop taking jobs are low margins unless they are additive in terms of service density and portfolio we will stop doing modernization businesses simply because it's an exciting engineering challenge which of course as engineers we love again nothing Dramatic, if you would say, but in fact, we have now to drive this discipline execution across every corner organization, geography and function. And that's what we've been doing starting last year, beginning of this year. There was no day lost. As we speak, this is being deployed throughout every corner of the organization. Now, again, I said we don't have time to go through every single point. Let me perhaps focus on two elements of the 4P. The first is the planet. presented already in q3 are net zero commitment certified by a science-based target initiative and now what does that mean in fact it's a big picture but you can see here on the right hand side of the chart that is of course split into element one probably on the On the left side here of these bubbles, these are what we need to do to deliver on a scope one and two, which is an infrastructure, our car fleet, how we drive our factories. On the right hand side, then you can see the opportunities. What does that mean in terms of products, services? So you have the green service here again, you have a class A product sale, which in fact are huge opportunities. And I can tell you more and more our customers demand that this is becoming is no longer an option. It is key in the real estate. And by the way, we see also the same from our building minds effort where real estate customers with large portfolios are very keen to have a sustainable portfolio meeting the Paris COP agreement targets by 2030-2040 otherwise there is a risk of stranding risk of this portfolio becoming obsolete with a huge risk of value loss. So another example now going on our internal aspect is one that I know very well because I was involved in this from the beginning. When we built our campus in Jading, there are there two factories. Now, in the meantime, they've become three. And from the beginning, we decided to invest before any formal commitment before any regulation we started investing in sustainability so you can see here on this picture this is the escalator and elevator factory this is the escalator one here 80 of the whole energy requirement is generated by solar panels and because it's a huge factory we have space but this is the idea how you use the space intelligently what you don't see here is the geothermal installation that we did from the very beginning when we laid the ground for this factory, which then helps generating a huge part of the whole electricity in the whole campus. Moving on to the other part of the 4P. So there is people, product, performance, planet. With the planet, let me just focus for a moment here on the product. And it is much more than a product. This is a key lever for our not only recovery, but for our performance optimization. It has to do with RNI margins as well. This is the reintroduction or I could say relaunch of the real simplified modular elevator platform, which we said already very openly, was not deployed the way it was supposed to it was even designed the way it was supposed to and so good news we don't have to invest many years because the key elements are there we just have the fixing to place in 22 and now in different waves which are highlighted on this chart by colors we are now deploying quarter by quarter the factory the new product in each factory it starts with standardization the real radical reduction in components and variation with consistent configurator deployment and of course there is a topic of cyber security which we now can deploy into each one of our product much more than we do today even though today we are think we're in the leading position the second wave will be about introducing net zero functionality but also having much unique and advanced user interface the third phase would be the one you see here in in the contemporary design and this combination of physical and digital functionalities and finally we're going to come with a product at the end of this evolution that will look very different it's going to be i believe the leader in its category which schindler was always the leader of we were the leader in the commodity business and now this is finally going to come back towards the end of the year now there is much more to be said about that and maybe i'd like to introduce one element here as promised now we plan to have more interaction with our investors and we plan here in the second half of the year to have a technology day which will hold the year in a beacon where you'll be invited then we will present to you this product with its functionality and plus a few other things on our technology which we look forward to sharing with you and more details will follow in your course With that, I think now it is time to move to our financial results. And I'd like to hand over to Carla de Geisler, our CFO. Carla, please.

Thank you, Silvio. I would say I would echo my two colleagues. It's a real pleasure to see some of you here in person. So thank you for coming. Before I start my presentation, just a couple of reflections on the current performance. So having now worked here six months together with Silvio and the colleagues, I'm really convinced that we are focusing on the right priorities. And I think that is clearly evidenced now by the progressive uptake of our profits, but also the recovery of the top line, especially in the second half of the year. Now, clearly, as Silvio mentioned, the nature of the challenges, they are of that, I would say, nature that it requires a reasonable time to solve them. So yes, we are making progress, but obviously we have not reached the end point yet. But together with the colleagues, we are focusing on the measures that we have already implemented. And at the same time, we are framing additional measures to really look beyond 2023. And in this context, I particularly focus on steering the performance first through the pricing discipline. Secondly, through efficiency improvement. Thirdly, recovery of the supply chain and obviously the monetization of the procurement savings, which will also play quite an important role going forward. And last but not least, the networking capital management. So at the same time, we are developing that strategic framework and that is really dedicated to secure the mid and the long term success of our company. Let me turn now here to the page result in a nutshell. Obviously, I will not comment on all the elements here as I touch on some of these topics further on in the presentation. However, just some high-level comments here. Overall, you've seen that the results came in at the upper end of our outlook and that is driven by that progressive trajectory of the revenue and the profit in the second half of the year. Order intake was broadly flat in local currencies for the 12-month period, and that is reflecting the deteriorating markets worldwide, but as importantly our shifted focus to value and margin. Revenue, as I said, it recovered in the second half of the year with a growth of 6.3% in local currencies and an increase of 2.5% for the full year, supported by a couple of Bolton acquisitions, mainly in the Americas and in Asia Pacific. Our service business continued to grow solidly and that was supported by an increase in units by approximately 4% and disciplined pricing measures. But I also like to draw your attention to the fact that the number of connected units now increased by almost 13% in 2022 and the number of digital service contracts increased even more, resulting in a monetization rate of more than 50%. So EBIT adjusted, positive trajectory resulting in a progressively improved margins in the second half of the year. And if you look now at the cash flow at the right hand side, Then cash flow from operating activities recovered in the fourth quarter. However, for the full year, cash flow from operating activities remained significantly behind previous year for the full year. So now the following two slides, they show the key figures for the fourth quarter and for the full year respectively. And you notice here that for the fourth quarter 22, the results confirm really that positive trend with a continued progressive improvement in the revenue and EBIT adjusted. Printing a margin in the fourth quarter that was higher than any other quarterly result in the year. Now, the week second quarter, which was particularly impacted by the lockdowns in our China operations over several weeks, but also impacted by the internal and external challenges as presented by Silvio, they took clearly their toll on the full year 22 results. And that resulted in a significant performance drop affecting profit and cash flow. Nevertheless, revenue growth in local currency amounted to 2.5%, and that is a result of this discipline backlog execution. Moving on now to the next slide, we take a closer look here at the order intake. For the fourth quarter of 2022, Order intake reached 3 billion Swiss francs, corresponding to a decrease of 4.3%, minus 2.7% in local currency. And this is a result of the slowing down growth, mainly in China and towards the end of the year also in some European markets, but also because of our focus to value and margin. Now, on the right hand side, you see the full year 22. Therefore, the full year 22 order intake reached 12 billion Swiss francs, corresponding to a decrease of 1.7% and 0.2%, so let's say, flattish in local currency. So the organic growth slightly decreased by 0.6%, acquisitions contributed 0.4 percentage points, while the FX had a negative impact of 1.5 percentage points. So thanks to our continued efforts to increase the prices and focus on these higher margin products, our order intake margins improved significantly. And in combination with the globally slowing down markets, the focus on higher margin projects resulted in mid-teens drop of new installation units. The order intake margin for elevators escalators in contrast improved by more than 25%. You have seen it also on the earlier slide that Silvio commented on. So Let's take a closer look now at the overview of the order intake by region and by product line, comparing 2022 with 2021. On the left hand side you see the comparison for the fourth quarter, on the right hand side you see the comparison for the full year. the order intake here it represents all product lines so the new installations the the modernization and the service and i will only comment on the full year development here so you see here the americas and the emir region they grew in local currency while the significant contraction of the chinese new installation market weighted rather heavily on the asia pacific performance So overall, new installations declined in units and in value, but on a positive note, the new installation margins improved in almost all the regions. And the modernization and the service business continued to grow, and this actually is nearly compensating the decline in the new installations. Order backlog, 9.6 billion Swiss franc, broadly unchanged compared to last year. And the backlog margin sequentially improved in the fourth quarter for the first time in years. And the year-on-year backlog margin drop stands now at less than 50 basis points, still reflecting cost inflation, product legacy and the portfolio rotation. I continue here with the revenue development. Starting with the left side, the fourth quarter of 2022 generated a solid revenue growth due to that continued strong backlog execution throughout the quarter. The revenue increased by 2.8%, up to 3 billion Swiss francs, and that is corresponding to an increase of 4.7% in local currencies. So EMEA and the American regions, they continue to have their growth path while the growth in Asia-Pacific pause towards the end of the year, obviously impacted by the newly introduced lockdowns in China. Nevertheless, taking everything into consideration, growth in Asia-Pacific was slightly up too. Moving to the right-hand side here, there you see the development for the full year. Revenue reached 11.3 billion Swiss francs, equivalent to an increase of 1%, 2.5% in local currencies respectively, and that was mainly driven, of course, by the strong development in the second part of the year. Organic growth reached 1.8%, acquisitions contributed 0.7% points, while FX had a negative impact of 1.5% points to the growth. solid increase in EMEA and the Americas region which was diluted by the decline in the Asia-Pacific region which was a consequence of the China situation during the second quarter but also during the last two months of the year. So overall growth in new installation was negative, particularly due to the weak growth across all regions in the first six months of the year and due to the situation in China. But modernization was muted in Asia-Pacific while service remained solid across our region and throughout the whole year. So moving now to the development of the EBIT adjusted and the EBIT. And of course, inflationary pressures, the product legacy, semiconductor shortage, supply chain issues, restructuring costs, they still persisted, impacting the fourth quarter. However, you see here clearly on the left side, the positive performance trajectory. how that continued nicely, especially in the second quarter, in the second half of the year, and really printing an improved margin in Q3 and in Q4. Now EBIT adjusted in the fourth quarter of 2022, reached 309 million Swiss francs. That is the highest quarterly result since the second quarter of 2021. And it represents an increase of 1% year on year and 3.6% in local currencies. Now for the full year, so moving to the right hand side of the slide, EBIT adjusted reached 1 billion 47 million Swiss francs. That's a decrease of 16.4% and 14.5% in local currency. Now, the adjustments between EBIT and EBIT adjusted, they relate to the top speed program, top speed 23. They relate to the restructuring cost and they relate to expenses for building mines. And the EBIT drop in the fourth quarter, that can be explained by a net increase in these adjustments, particularly the higher restructuring cost related to the resizing of our operations, mainly in China and mainly in the US. Now, coming back to the top speed program. So over the last two years, we have spent 130 million Swiss francs for the program. Now, a realignment with the operational priorities and lower investments for mass connectivity, they are expected to lead to a significantly reduced overall program cost of 170 million Swiss francs, opposed to the initially planned 270 million Swiss francs. So as a consequence for the remaining 23, the spend is expected to amount to 40 million Swiss francs. We are making continuous progress on these various initiatives and one that stands out that is clearly the fact that already a quarter of our portfolio today is cloud connected. Moving now to the operating cash flow. So cash flow from operating activities weakened and that has to a large extent is driven by the substantially increased network capital requirements. That's mainly an increase in inventory and work in progress. And of course, that is related to the challenges that we have been facing and are facing in the supply chain. Cash flow from operating activities declined by 12.4% to 312 million for the fourth quarter in 2022 and to 688 million Swiss francs for the full year, equivalent to a decline of 47.6%. Now, moving to the dividend, and the dividend obviously is subject to approval of the annual general meeting, is maintained at 4 Swiss francs, which is equivalent to a payout ratio of 70%. which is above our stated dividend policy range of 35 to 65%. So taking into consideration the closing price of the registered shares listed on the 6 Swiss Exchange on the date of the Board decision, which was yesterday, the dividend yield stood at 2.5%. And it should probably not be a surprise that we stick to our four Swiss franc dividend because we have a very strong balance sheet, number one, but we also really believe in our recovery plans going forward. And obviously, we had no intention to break our dividend track record here. Now, you might have noticed that we are accelerating our initiatives in the area of sustainability over the last few years. It is clearly also part of our strategy going forward and a pretty important part. And on this slide, you see here now the overview of our achievements compared to our roadmap 2018-2022. So that sustainability roadmap ended this year. And Schindler met five of the six targets that were set in 2017. So we missed one and we missed it with 0.3 percentage points. And this is our objective, to reduce the CO2 emission by 25% in the global fleet. It is clear that our miss is partly also due to the slowdown of the plant conversion to e-mobility, which is related to the challenges that the automotive industry has been facing. Now, with regards to the other targets, I believe that we have made good progress since 2018. So we comfortably met our ambition and now clearly our focus shifts to our 2030 sustainability roadmap, which is being developed on the basis of our updated materiality assessment and our net zero target. So now moving on to the outlook. So starting with the market. So the global new installation market was mid-teens negative in units in 22. That was mainly driven by the situation in the Chinese market. Modernization service held up well. For 2023, we expect a similar pattern for the global new installation market, driven by a continued weak Chinese market as well as a slowdown in some European markets. The overall development is very much dependent on the timing of the supportive measures in China and the effectiveness of the measures. Modernization and service markets, they are expected to grow between 5 and 10%. And this is then the basis for our outlook 23. As already mentioned, we very much focus on pricing and efficiency, and bearing any unexpected events, we expect low single-digit revenue growth in local currency for the full year 2023. Positive EBIT adjusted margin trajectory is expected to continue, since of course pricing and efficiency are expected to more than offset the inflationary impact that we are facing. Finally, I would like to assure all our colleagues around the world, wherever you are, that we very much appreciate your hard work in 2022, but you can clearly see that it resulted in an improved performance in the second half of the year. We all know that tough times are not over and it will take a while before we can close all the identified gaps. However, we are very, very convinced that we will reach our ambition in a unified effort. And with this, I hand over to Marco. Marco, the floor is yours.