Dynavox Group Ab

Good morning and welcome to this earnings call. We will cover the third quarter of 2022 and our business then in July, August and September. Click. I'm Fredrik Ruben. I'm the CEO of Tobii Dynavox.

And I'm Linda Theibring, CFO of Tobii Dynavox.

And in this earnings call for the third quarter of 2022, we'll first take you through some brief fundamentals about the company, summarizing the main takeaways from the quarter. We will then dive deeper into the financials, and thereafter, there will be a Q&A session. You can submit questions during this live session in the chat function that you have in front of you on your screen. We, of course, and also for this call, you can submit offline questions via email to Linda's email address, which is linda.tybring at tobydynabox.com. Right, but then we'll dig deeper into a little bit of a summary about what Tobii Dynavox is about. The first and most important is to reiterate our mission and vision, which I know is very dear not only to roughly the 600 or so colleagues around the world in Tobbe Dynavox, but also to our ecosystem of partners, investors and more. Our vision is a world where everyone can communicate and we will contribute to this by focusing on our mission. Our mission reads to empower people with disabilities to do what they once did or never thought possible. And this basically summarizes two of our main user stories of the people that we're trying to serve. The first one is to do what you once did. That may be the person who led a normal life until a diagnosis such as ALS rendered her unable to control her body or communicate like before. The other story is never thought possible. That can refer to the child diagnosed at an early age with a condition such as autism, cerebral palsy, where thanks to our solutions, she can do much more than the world around her ever thought possible. And on the picture on this slide, you see Delaina Parrish from Florida, who was born with cerebral palsy, and she is an absolutely great example of that user story. The market that Tobii Dynavox serves is hugely underserved. There are some 50 million people on the face of this earth that have a condition so grave they simply cannot communicate unless they have solutions like ours. Every year, about 2 million people are being diagnosed, yet only about 2% of those are actually being served. The rest remain silent. The main reason for this spells lack of awareness also among the professionals and the prescribers that are tasked to assist these users, which then, of course, obviously leads to poor health care reimbursement system, even in some of the most well-developed countries in the world. Tobii Dynavox, we operate with a global footprint. Today, some three quarters of our business stems out of the US, largely because a reasonable, well-functioning funding system established some 20, 30 years ago in the US. But our products are also sold in over 60 markets around the world. Our staff is distributed in a similar way as our revenue. That means that some 75% of our own staff are based in North America. our u.s headquarters in pittsburgh pennsylvania our second largest office is here in danderyd outside of stockholm where we but we also have branch offices in several european countries as well as in suju china at this point we employ roughly 600 employees or 550 full-time equivalents With the recent acquisitions, we have now established or increased our presence specifically in countries including Belgium, France, Ireland and Denmark. But we also have a smaller number of remote employees in primarily Central Europe. At Tobii Dynavox, we provide a comprehensive portfolio of solutions. And it ranges from these five kind of buckets that we have on this list, where the first one is the content, such as the world's leading library of communication symbols called PCS. We also have synthetic voices and specifically the voices is a component that we now own in-house through the acquisition of Acapella Group, which is the world's leading provider of naturally sounding and diverse synthetic voices. If we then go down to the list, we also have highly sophisticated communication software. That software is tailored to the type of users, which obviously can vary greatly based on that specific user's needs. We then develop and design devices with cutting edge technology. They're typically medically certified, very, very durable. And this, of course, includes communication aids that you can control via eye tracking. We have services portfolio to help our users through the complexity of obtaining and getting funding for solutions. And last but not least, we're there to help our users, therapists and caregivers through a global team of support resources. We operate this model globally, and it's important to know that each piece of this that you see on this slide is critically important and also a significant differentiator for us, making us absolutely unique in this space. Tobii Dynavox's go-to-market model is predominantly as prescribed aids. Some 90% of our revenue comes from public or private insurance providers. This also means that we have solid paying customers and have always been very resilient towards changes in the overall economic climate, which is obviously something very important at this date and time. In addition to that, our market is, as I showed on the previous slide, extremely underpenetrated. So that, again, was a little bit of a recap about Tobii Dynavox. So now we'll move back and focus more on the main topic of today, namely our earnings report for the third quarter of 2022. And I will start with some highlights and the main events from the quarter. We had yet another very strong quarter when it comes to revenue development, both in absolute terms, but also in adjusted terms. The underlying revenue growth compared to the same quarter last year sums up to 25%, which is the same trend as we saw also in the second quarter of this year. We obviously feel the strength of an up-to-date product portfolio. It's continuously improved with new products such as the SC Tablet Mini, which is in the picture on this slide, which was launched in September, combined with many new software improvements. And specifically, the SC Tablet Mini is a highly portable, medically certified communication aid that we target towards younger ambulatory users. Typical case is children are children with autism. At the same time, we also grown our sales and marketing organization and perfected steering and onboarding to ensure that we have a minimum of delay once we onboard new employees. This includes further strengthening our US funding organization, which is a function which is an important inside sales and support team basically. They navigate each customer through the complexities of obtaining funding for a new communication aid through private or public insurance systems. Our relentless work to improve awareness and the competence around the solutions we provide continue specifically among prescribers and professionals and the value of now being able to meet in person after the pandemic both internally within our team but also as well with as with our customers it cannot be underestimated the majority of our growth in the quarter continues to come from our north american markets which is also the largest and most influential market in our industry so it's not just us In Europe and other select markets outside of North America, the healthcare systems and the processing are still not fully up to speed as a consequence of the pandemic. The underlying need is, of course, no different compared to, for example, the US. If you then go down further out in our P&L, our margin continues to be negatively impacted by higher than normal component costs and freight charges. But we see a clear improvement when it comes to the component prices, which will help us in the longer term. We currently have adequate stock levels for all our main product lines, basically. Our OPEX levels are higher than a year ago, but this must be seen in the light that a year ago, we still had large portions of lockdowns. We also have the split from Tobii to become a standalone company, which has increased our OPEX and we have made significant investments in our staff. We see that this increase will start to plateau going forward. In the quarter, we also concluded the acquisition of our Danish reseller partner Ask, which now enables us to align our commercial organization, which is direct in the same model as in Sweden and in Norway. And these are all three markets with similar characteristics. I'd like to hand it over to you, Linda, to take us slightly more into details when it comes to our financials.