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Dear all, a warm welcome to this webcast where we will present the year-end report and the quarter four report for A3. My name is Jonas Gustafsson, CEO at A3. And I will also be joined from Bo Sandström, our CFO, who will make part of the presentation. So again, thank you so much for joining and we will jump right into the presentation, starting with the presentation of the presentation and starting with a summary of the fourth quarter. So if you look and start with the top line, as you have seen, we had good growth in the quarter. So we deliver continued good growth of total 8%, where the adjusted organic was 6% or 5.9. And in general, I will come to a market slide later on, in general, we see a good demand for the A3 services across all regions. Very strong in energy, a bit more mixed in industry and the real estate segment as one continue to be weak, but more or less as we saw in the third quarter. The order stock is solid on just about 19 billion. So we have a good and strong order stock. When we look at the result, it was a solid result, stable result and very positive also, we had a good cash flow in the quarter. So EBITDA just below 600 million and the EBITDA margin was 8.4%. And if we would adjust for the calendar effect, we were well in line with last year's margin. And again, strong cash flow, Bo will touch on that later on. And that enabled us also to further improve our financial position. You saw also in the report that the board of directors proposed a dividend of 550 per share. And I think one of the big highlights in the report in the fourth quarter is that we really see effect from the improvement program we have started up in infrastructure. As we all know, we were not in balance in the third quarter and also the second quarter when we saw the drop in the real estate segment. And we now start to see the effect from the improvement program and infrastructure, which is very positive for us. We have more to do, but we really see effects in the fourth quarter. And of course, moving forward for us, it's really, really focused on utilization and being flexible for any market condition we have. But in general, it was a solid and positive quarter and for A3, a step in the right direction, I would say. Again, then looking on the market, as I said, industrial sector, there is a bit of variation between segments. We have really strong segments like automotive and defense industry as one. Pulp and paper, we have seen, as we saw in the third quarter also, that when it comes to larger CapEx projects, there is some uncertainty in deciding for those. We have also seen in areas like telecom and IT, a bit lower demand and that has affected also industry and digital solution in the quarter. But we also, as I said, really have some strong segment and of course, the energy segment, really strong, I would say across all regions and sectors, sub-sectors, we see a demand. And this is of course where A3 is very well positioned, so that's very positive for us. And I would also say that in the infrastructure, the real estate segment continues to be weak while public investment continues to be on a stable level. So a bit mixed, but all over, I would say that there is a lot of demand for the expertise that we have at A3, of course, driven from this big industrial and energy transition that we see in society. When we look on each division, and Bo will cover it a bit more, you have seen that we have clustered a division basically in three. We have three divisions that we are clustering in the first one. This is the division process industry, energy and management consulting. These, all these three divisions have a global footprint and they are basically driven from the big industrial transformation in process industry and energy. And here it's very good to see that all the three divisions continue to deliver an EBITDA margin of about 10%. Of course, starting with process industry, close to 12%, very strong quarter and also good growth. So I would say that strong performance. We have seen that the order stock in process industry is slightly down year on year, but still remaining on high levels. Energy, another very strong quarter, 11.5%, strong, good growth. And I would say that here we have a really, really good demand. And when you look on the order stock on energy, it's all about timing effects. The demand is very strong across all regions, as I said. And then management consulting, strong growth. The margin in that business was slightly lower. The major reason for that was that we took two of the former A4X divisions in Finland and integrated in A4X. And that restructuring is ongoing, which is explaining part of their, a bit drop on the margin. But the underlying business is very strong. And of course, when you look on A4 now being positioned globally, with all our expertise in bio industry and energy, there is a very good and healthy demand for our expertise also in that area. So I would say this is really the stronghold and we continue to deliver good result in those three divisions. Then infrastructure. And of course, you know that we have been working a lot to improve the profitability. And it was good for us to see that the infrastructure in the quarter took a step in the right direction, improving the margin compared to last year. And of course, with the calendar effect, it was even stronger. And this is really an effect of the improvement program that we have launched in infrastructure. As you all know, we were not in balance when it came to the demand, especially in the real estate segment. So right now, we are executing on the restructuring and the turnaround program as we communicated. So when you look on the, we have reduced the employees with roughly 200 in the quarter in those relevant segments and regions. And this is actually according to the plan. And 110 of those were, we had to lay off and the rest we could manage with other activities. So we are still not where we want to be, but this was really a good step in the right direction for the infrastructure division. And then finally, industry and digital solution. This was a weak margin compared to last year. One large explanation is that we had to take a larger write-down in one project. That explains quite a lot of the Delta compared to last year on the margin. But we also saw low utilization in areas like IT and telecom. So for sure moving forward, there is a lot of focus now to bring utilization up in industry and digital solutions. So that's what we have seen on the division. So all over, as I said, a positive step in the right direction for A3. Want to highlight three projects. One is the sustainable craft paper production in Beckhamma, Sweden. This is a typical project that we see more and more of. So it's not a new CAPEX project. It's not a green field investment, but it is where we help to improve efficiency and also reduce emission. And these are example of projects that we see more and more of. We have also received a project in Czech Republic where we will do the design construction of a new concert hall, but also a lot of planning around transportation. And it's a really cool project where we will be a big part of the center part of Prague. It's a really nice project for A3 and the infrastructure division. Finally, two frame contracts in Norway that we also see more and more of where we will support to develop the power grids in Norway. One project I want to highlight that we don't have on this slide that we also press released last week is that we have also taken a project to BI Systems Hegglunds, 300 million, where we will support them in modernizing their CV90 platform. And we will set up an office of around 100 engineers and this is really a fantastic step for A3 into the defense sector. And this is thanks to our strong vehicle knowledge that we have at A3, including software. So this goes into industry and digital solutions, so a great project and also into a very, very interesting segment, defense industry. Then just look on 2023. We ended up at 27 billion and of course, looking back six years, seven years, we were at 12 billion. So if you look on the growth journey, it has been a really fantastic journey. We delivered total 15% growth in 2023 and 17% in 2022, so really strong. EBITDA 2023 was 2 billion, EBITDA margin 7.5. If you had just for calendar effect between the year, it would be more close to eight, but still we all know that the EBITDA margin is something that we are working very hard to improve moving forward. So that's really, as we have said, focus into 2024. And again, we did a lot of activities this year, the whole restructuring program in infra that starts to yield effect, but also the A4X division restructuring. So a lot of things ongoing. And as I said, we have strengthened our position globally and before I leave over to Bo to talk through the financial, we have yearly these rankings coming out. And it's really, really great to see that A3 in a lot of sub segments are ranked top one to 10 globally among engineering firms. Of course, number one, we have been in pulp and paper, but also in other sub segments like steel mining, chemicals, food and beverage, and in energy co-engineering, operation and maintenance, hydro, transmission and distribution. We are on a global competition level, one of the top one or up to top 10 companies. And this is really, really good for moving forward since there's a lot of activity driven from the industrial transformation. With that, I will invite Bo to talk through the financials for the quarter a bit more. And I will flip the slide for you here, Bo. So the stage is yours.

Thank you, Jonas. So I will cover the main financials for Q4 and I will touch upon the full year 2023 during my presentation. So starting with sales, quarter four was the first quarter where we surpassed 7 billion in sales. Total net sales in the quarter, 7.1 billion, some 500 million above Q4 last year. And on a rolling 12 month perspective, now at 27 billion, as Jonas said. We report 8% total growth and 6% adjusted organic growth down from 9% last quarter. Growth was driven by high demand across most of our segments supported by price increases this quarter of circa 5%. The order stock is at 19 billion in line with last year, but sequentially lower. Looking at EBITDA development, EBITDA came in at 596 million, 3% higher than last year despite the negative calendar effect. The EBITDA margin was at .4% well in line with the last year calendar adjusted. Utilization lower than last year, approximately 0.8 percentage points, but the difference in the quarter was less than we've seen throughout the entire year. For the full year, we report EBITDA above 2 billion for the first time with calendar driven movements on rolling 12 months throughout the year. Compared to full year 2022, we have improved EBITDA with approximately 150 million. We report one negative project right down in the quarter of close to 30 million, affecting -over-year comparisons for the industrial and digital solutions division. As reported in conjunction with the Q3 report, we report material restructuring costs in the quarter, totaling 55 million Swedish. We see partial effects of these savings already in the quarter. The restructuring costs relate primarily to the improvement program ongoing in division infrastructure. We executed planned redundancies during the quarter and in the 47 million related to infrastructure restructuring, there are also some costs related to lease premises as we continue to -by-step optimize our lease footprint. With Q4, we also complete the A3X restructuring and report some related restructuring costs. Development by division, we still see rather strong adjusted organic growth in four divisions. Only industrial and digital solution have a negative growth, partly driven by the project right down mentions and to some extent also affected by the restructuring efforts by former A3X units. The growth in the management consulting division remain well above 10%. On the margin side, margin development was mixed in the quarter. Process industries, energy and management consulting continue to deliver strong results. And again, both energy and process industries managed to increase their respective EBITDA margin despite a negative calendar effect. Management consulting was affected by a software write-down in the quarter, negligible for A3 group, but explaining more than a percentage point in the division of margin. Infrastructure margin reported .4% in Q4, a clear improvement to last year despite the negative calendar. Following two week quarters, the division has improved utilization levels and has delivered quite consistently throughout the quarter. Finally, on the back of Q3, industrial and digital solution again showed pressured utilization for parts of the business in the quarter. That in combination with calendar effect and the project write-down, more than accounts for the margin dilution compared to last year. The division work intensively to regain performance on utilization. Cash flow from operating activities is clearly stronger than last year. In the quarter, we managed to reduce working capital supporting the already seasonally strong quarter. As a consequence, financial net debt decreased below 5 billion and liquidity increased sequentially to 4.2 billion. And finally, a full year update on the financial targets. Growth for the full year end at 15%, somewhat lower than last year, but still well above the 10% target. EBITDA margin ended at 7.5%. The full year margin adjusted for calendar effects is estimated at 8.0%, which is in line with the full year target. to the full year 2022. Improving the margin remain our key focus areas going into 2024. Leverage decreased sequentially to 2.4 times, driven by the strong quarterly cash flow. Some deleverage was expected, but we are happy to see, happy to close the year below the financial targets. The board proposed an unchanged dividend of 5.5 Swedish krona per share, corresponding to approximately 0.3 times on leverage in Q2. And with that, I leave back to Jonas. Thank you, Bo.

Just before we do the Q&A, a short summary. Moving into 2024, I will say the focus remains unchanged, as Bo said, we will keep our focus on improving profitability and the margin. Of course, infrastructure is key in that, we know that, and again, it's really good to see that the infrastructure program starts to give effect already in the fourth quarter. Secondly, of course, as we have said, continue to build on those strong positions we have. We have a lot of activities in segments like energy, if you look on the nuclear segment, there's a lot of demand for our expertise. So to build on our strength, but then of course, in general, to improve efficiency at A3 and be prepared for the mixed market. We have seen some subsegment in industry being weaker, affecting industry and digital solutions. It's all about focusing on utilization. So these are the three areas in general that we will focus on in 2024. So with that, I will invite Bo again on stage and we will open up for the Q&A's.

Johan Sundén at Carnegie.

Welcome, Johan. Let's see, hope you can hear me. Thanks for taking my question. A couple of ones, I think maybe for you, Bo, to start with. You mentioned software writing in the management consulting business. Is it possible to quantify how big that was, firstly?

Yeah, it's approximately five million. So it's, as I said, it's negligible for A3 group in total, but given that it affects the margin of management consulting, I commented on it.

Excellent. And then on in-data data solutions, we're talking about the softer demand in few pockets. And focus on utilization going forward. How is discussion going currently with regard to redundancies in that division going into first half of 2024?

Clearly, as you say, we have a couple of pockets, as you said, that has been weaker. So the discussion is that we will optimize, optimize, optimize. We don't see today a need for a bigger restructuring program in that division, but more using all the tools we have to adjust capacity and focus on utilization. So that's where we are at current when you look on moving forward, because at the same time as we see that, we see, as I said, the automotive segments continue to be strong. And again, the defense industry, as we have highlighted, starts to be, and of course, a very interesting segment for us. But by tweaking, tweaking, tweaking, and focusing, we believe that we will be able to get in balance. So no need today for a bigger restructuring program in the CIRN data solutions.

Great, thank you for that. Another question is on employee turnover, and especially in APRI Sweden, which has increased over the last few years. When you close the books for 2023, is it possible to comment how that trend has developed during the 23,

or 22? I can comment on the role of APRI, it is a trend going downwards. So we see, of course, driven from the overall financial economy, we are trending downwards, and we are now on levels that we used to be at APRI in total. And APRI Sweden, I think, follows that trend pretty well.

Excellent, and a final question from my side. It's on capital allocation ahead. Good de-leavaging in Q4, now below the 2.5 times leverage target that you have put up. How is your thinking going forward? Will you continue focusing on de-leavaging, or will you be more open to ramp up M&A activity again, or how should we view this?

Yeah, I mean, as I said, we're quite happy that we closed the year in a strong fashion, and actually somewhat below the financial target. We will continue to be rather cautious on capital allocation, but of course, always looking for opportunities on the M&A side, but rather be on the low side than on the high side on the leverage is what to be expected.

Perfect. I think I'll pause there and get back in line and come back with a few follow-ups if we have time.

All right, thank you. Thank you.

Now we have Fredrik Littell from Handelsbanken. Fredrik Littell from Handelsbanken. Can you hear us? Okay. Moving on, Stefan Knudsen from ABG.

Yes, perfect. Good morning. Just on the ideas right down, can you quantify that a bit more?

Yeah, I mentioned in my presentation, it was close to 30 million in the quarter.

Oh, sorry, then I missed that. And secondly, on the price-wage balance, you seem to have a positive delta there, are you seeing any concerns that it will be harder to maintain that going into 2024?

Yeah, I mean, as you have noted throughout the year, we've been able to drive a good price development and we've been typically on the north side of 5% in price increases for each of the quarters throughout 2023. Then of course, we now go into new year and we meet in that sense, higher comparisons, but we are quite focused on maintaining a net positive balance also in 2024. Although it's always a battle in that sense, but we're quite focused on it.

Perfect. And then just on the order book, we saw a decrease here in the quarter, but is it revalued based on average exchange rates or end of quarter exchange rates?

It's at the end of quarter exchange rates.

Okay, thank you very much.

Thank you.

Moving on to Johan Dahl, Et Danske Bank.

Yes, good morning, everyone. Just a few questions. On infra, the improvement that you're seeing here in the fourth quarter, and you've talked about portfolio review, you've talked about cost out actions, you've talked about the efficiency. If you try to sort of split up what we're actually seeing in the fourth quarter into those various buckets, and also of those improvements, what are those, are they sustainable going into 2024, do you believe, and your visibility on that? A long question, but just to understand exactly what's happening in infra and Q4.

So good question, Johan. I think of course, a lot of activities in infra during fourth quarter and also fall have been to, first of all, get in balance. We saw the real estate segment shrinking for us more than we saw. That was one big thing that we did, just needing to lay off employees and also using other tools to get in balance. And then of course, Robert and the team have started to look in many areas in the whole operational structure for infra. But I will say that a large portion of what we have seen right now has been operational improvement, including capacity balancing adjustment. So the review discussion we have on portfolio, for sure we will continue to work on that and we expect effects coming in of course next year. Because we know that clearly, I mean, it was a step in the right direction and I'm really pleased to see the progress, but we know when we have communicated that what margin corridor is for infrastructure and we still have ways to go. So we are not done with the improvement program, but of course since utilization is a very strong driver for us, Robert and the team is really, really focusing on bringing utilization in different business units. So more to come, but the first part had been very much on operational improvement while we of course look a lot on the structural changes also moving forward.

How much should we read the lower order book in infra in the fourth quarter? How much of that is sort of due to your own discretionary decisions to potentially sort of become less, become smaller in less profitable areas?

I think, I mean, you're absolutely right, you are of course now, which is a part of the process we are putting in place to make sure that we have a very stringent bid process, making sure that we have good control of the margin on the product we are taking in, including then the fact that the real estate is in low levels. Still what we're saying is that the public infrastructure project is still stable demand. So I think the market compared to quarter three is not that different, we are adjusting. And I will say in big part of the infrastructure, there is still a healthy demand. So I wouldn't read that much into the order stock of infra. We want to make sure that it's a very healthy order stock.

All right, just a final question on your sort of global leading positions in processing industries, energy, et cetera. To what extent do you have to sort of, to what extent does it take focus away, focusing on infrastructure and margin improvement in ideas, et cetera, compared to growing those sort of global niches?

No, I would say not, Johan. As we have done since we acquired Peugeot, we have set up the A3 in this division. So if you look on Nicholas Oxon, who leads process industry, he runs that with the full PNL, full accountability, optimizing that. And it's been a really success story for us. And of course, Robert now running infrastructure, he has full PNL and responsibility for that. So we want to make sure that we can go full speed where we have good position, and then of course, deal with the issues we might have in other divisions. So I think the reason why we have not been successful in infra to bring the morning up has really nothing to do with the good growth we have and the global position we have in process industry. But so I think the model we have is pretty clear. And I'm really happy now that Robert coming in new, he was new in infra as you know, then after vacation. And of course, Robert have this extensive knowledge from the whole ESPN, 25 years in industry, operational model, governance steering, back to core and utilization, looking at portfolio, all of that is what gives us effect. But so we are very proud, Johan, on our global positions in process industry. And I think looking ahead, we will continue to look on potential, you know, growing that footprint while super focusing on infrastructure. Excellent, thanks. Thank you.

Thank you, Johan. Moving on to Dan Johansson at SEB.

Yes, thank you so much for taking my questions. I think I had two additional here. Maybe I'll start with a bit of a follow up to Johan's question on improvements in infra. I suppose you didn't see the full effect here from the 200 reductions that was conducted here in Q4. My experience is that these changes takes rather quick, but it takes a quarter or so to make it work. So before you see the full effect, so am I wrong there in my thinking or will we see more sort of effect in Q1, Q2 from the changes you already made now?

I can elaborate a bit on that. I mean, for sure you see partial effect, but you're not wrong in your analysis in that sense. Reductions done during the quarter, of course you don't see immediately full effect in the quarter as such. What we can see however, is that we have been able to pick up the utilization levels throughout the quarter, thus planning for those reduction effects in a good way. So in that sense, you will get cost out effects going into the new year, but utilization level, we've been able to manage at a high level throughout the entire quarter, even though we've been doing reductions during.

Perfect, thank you for that clarification. And maybe a bit on your taking down office space as well, it seems, and of course office analysis, office list is a larger cost item for you, of course. So how much potential is it there? I guess rents are also coming up, I guess. So is it sort of to mitigate the higher rates or is it more forward learning that you actually see some cost benefits as well on top of just compensating for higher rates?

Yeah, I would say that we have a long-term ambition on optimizing our lease portfolio in that sense. And what we have said and what is still true is that on a short-term perspective, while inflation and indexation increases are still high, our ambition is to neutralize that to the best extent that we can in order for that not to be an increased cost burden for us. But I think over time, if that pressure is coming down a bit in the upcoming years, then I think we see some potential on actually at least reducing our share or our cost from a share of employee perspective, our relative cost from leases.

Okay, sounds good. And maybe a final one, if I may, a bit on defense, you touched a bit on it, you took a good order from Hegglund. Sweden seems likely to join NATO now. What sort of business opportunity will it be for you in 2024, 2025, and can it sort of bridge part of the weakness that you see in other parts of that segment perhaps, or in industry overall?

No, for sure we see a very interesting market for many reasons in the defense industry. And I think this particular order is a fantastic work from Martin Öhman and the team in the industry. And did it because the reason is that we have this really extensive software and vehicle knowledge and that we now can be a strong partner to be a system Hegglund to do that. So this is, and also for sure in general, we will of course do everything we can to focus and do segment that still is strong. So I know Martin and the team are pushing a lot and let's see then, but for sure the defense industry as such, which is really a high tech business of course, and that's where we have our knowledge that will be a very interesting and good segment for A3 that we will do our utmost to position ourselves strongly into.

Yeah, interesting to follow. Thank you so much for taking my questions here. Thank you.

Thanks,

Don. Thank you, Don. Moving on to Raymond Key at Nordea.

Good morning, Bo and Jonas. Hello. First question from me too, if I may, regarding the lower utilization year over year, how much was sick leave impacting this or weighing it down? And if so, if the utilization was adjusted for the difference in sick leave, where would we stand year over year?

Yeah, utilization is typically not affected by sick leave. So utilization is measured on the net of sick leave in a sense, so that's, it's not related. And then I would say that looking at the specific quarter and practically throughout 2023, sick leave has not been a big year over year impact for us in that sense. It's been quite similar throughout the different quarters that we've had now that we have left the kind of post pandemic part a few years behind us.

We were a bit worried, but I will say that as Bo said, it kept the seasonal pattern throughout quarter four and December that normally is a challenging month.

Got it, so it's mostly demand driven then? Yeah. And you have more people on the bench.

Yeah, if you look year on year, as we said, that's been, as you know, something that we have been, we were not in balance, especially in the infrastructure that we are now adjusting. And then across A3, we have other pockets where we are not like now in industry and digital. So for sure moving forward, that is now a KPI that all the visual head and business area managers are focusing on. And of course, I have to say this too, I would say exceptional strong growth here, 17% in 2022 and 15, 23. And we see now sequentially coming down. And I think we will now use that also to really tweak and focus on utilization. Because we are not, if you look on the total level, as you point out, we have higher ambitions than what we are at right now, even though we see sequentially improvement compared to quarter three.

Got it, and second and last, if I may, you had an impressive working capital release of more than 500 million SEC in the quarter. And I saw a peer of yours also reported today, they did not see a similar working capital release. Was this just a seasonal effect for you? Or is there something specific or a few things that you can point to to attribute the strong working capital release to?

No, I mean, I think the strong cashflow and the strong cashflow in general was mostly seasonal. But of course, the working capital reduction, I think in all fairness, it was a bit bigger than one would have expected from a seasonally strong quarter. I think you should see it in relation to the buildup of working capital that we've seen throughout last year, also moving into Q1 this year. Then we've had a quite consistent development throughout Q2 and Q3, and we finished the year off by actually being able to reduce the working capital in the last quarter, which is quite comforting. But I think you should see it in relation to that, which also makes sense if you compare it to a competitor or other than that. It's more of an internal factor.

Excellent, thank you very much. Thank you.

Thank you, Raymond. Now we welcome back Johan Sundén from Carnegie.

I have one small follow-up question. It's regarding the strike that is currently happening in Finland. Is it possible to comment on any kind of impact that you expect in Q1 when you relate it to the strike?

No, I can only say the strike that is ongoing right now is not impacting us. And then we'll see. But right now what we see is not affecting A3. And then we'll see because I guess nobody really knows how it will and if it will continue. But as it is, no real effect at A3. As we know. Excellent. Okay. Yeah,

perfect. Thank you, I'll get back in line.

No more

questions?

Okay. So it looks like we have answered all your questions. So with that, me and Bo would like to thank all of you for participating and looking forward to see you soon again. And we want to wish you a good Friday and a nice weekend. Thank you so much for joining. Thank you.