BIMobject AB

Hello everyone, good afternoon and welcome to the call. We are just about to start and we're letting the final people into the call. So I want to start by saying if you have questions during the call, you can send them to this email address that you see on your screen, ir at bimobject.com. But I think we will kick it off. So we are gathered today to talk about the Q1 presentation. And I will start off by presenting our host of panelists that you're going to hear from on the call today. So with me today, we have Sofia Hyllén, who is the interim CEO of BIMObjekt. We are also joined by Pia Engholm, who is the chair of the board. Today on the call, we will also be hearing from Daniel Olausson, who's the chief product officer. We are going to have Per Jarlsson with us, who's the CFO. My name is Lisa Norlander, and I'll be hosting the call for you today. So diving into the agenda, we have for you today a short business update where we're going to talk through some of the recent events that we have communicated around. After that, we'll dive into the financials with a quarterly update for you and the numbers that you also have seen in the report released earlier today. And as always on these calls, we end with a series of questions. So again, ir at BIMobject.com is your email address to send those questions to you to us and we will pick up as many of them as we can at the end of the call. You can also reach us at this email at other times so if we don't answer all of your questions today please reach us there. But without further ado I will leave over the word to Sofia and Pia.

Thank you, Lisa. I will start out by welcoming everyone to this quarterly investor call. I'm very glad to be here today. We have a fantastic team that will present information to you. And I just wanted to take a few minutes in the beginning to comment on the fact that during the quarter we made a CEO transition, as I'm sure you've all seen. I'd like to thank Martin for his contribution during a very important phase of the company's development. And we're now entering a new chapter, we are on the path to both validating, implementing and growing a new strategy. We've demonstrated a strong model, we feel like we're on a very solid ground. And we know what we need to do to reach growth. And the recruitment of a new CEO is underway, we are in the middle of that process. And this recruitment will be aligned with this next phase of our growth journey. Meanwhile, the board has full confidence in our great management team. I'm very proud of the enormously positive impact that the whole team is showing. And when they're actively working with our new strategy, I'm sure you've also noticed some of these things already last month. And they are being governed or run by a fantastic interim CEO, Sofia, who set the helm of this team. And we are very confident in this, both Sofia and her group. And we are really, really happy with what we've seen and that they are running this company while we're in the process of recruiting the next CEO. And with that said, I'd like to hand over the word to you, Sofia.

Thank you, Pia. And hello, everyone. My name is Sofia, and this is, as you know, my first quarterly report. If you would ask my team about my most annoying trait, they would say that I'm allergic to buzzwords and that I always want to find the actual message in everything. This makes me sometimes a bit too direct and transparent. All right, let's go. This quarter, we have delivered a steady ARR growth of 7% and turnover grew by 10%, with an additional 1% uplift from currency effects. We have an EBITDA of minus 18 million SEK, which is compared to last year's minus 7.7, a significantly lower operating result. However... This is a cause of two things, our investments in strategic product development and some extraordinary costs affecting comparability. We have decided to take the full costs of the CEO transition in Q1 and also reserved for the social security costs for the upcoming LTIP program. And we have also seen that the positive currency effects that we have seen previously from a strong US dollar is not around any longer due to a strengthened Swedish crown and also weakened USD. We remain in a solid cash position with almost 200 million in liquid assets. With that said, we of course have huge respect for the funds invested in us and are working hard to use the funds wisely, which currently is to invest in growth. Looking at the BIM investment from the outside, I'd say that a new market risk is the uncertainty that the tariffs have introduced in the market. Currently, it does not affect us directly, but we can see the effect it generates in the market, both in the US and beyond. Something, however, that does not slow down is artificial intelligence. And we are also thrilled to talk more later in this presentation about the acquisition of Greenmetrica and Lumia AI platform. And I myself continuously impressed and grateful of the AI features already introduced in our products. as well actually as the usage of it in my own daily work. The construction industry is still increasing in demand and still faces serious productivity challenges. The total addressable market, the TAM, of the global construction industry is substantial and continues to grow. As of 2024, it estimates that the industry's value is between 13.6 trillion and 16.1 trillion, depending on the source and market segmentation, of course. And projections indicate continued expansion. And we are here because we believe that that can be improved and through the access of reliable product data, that that can be improved through the access of reliable product data. I feel confident that we can play a key role in the digitalization of the construction industry through our products and through our position in the market. So, as you can see and read in the press release that we launched yesterday, late in the evening, we have signed a letter of intent with Greenmetrica AB and Lumia AI Platform AB. We have been working together with the team for several years and are thrilled to officially merge and welcome them on board to the group. The team consists of skilled AI developers and software architects who have been instrumental in the development of Yandways. We have worked really closely with them and are therefore confident of the collaboration. With the skills that they bring us, we will also increase the knowledge sharing in the organization, which is actually something that was done most recently at our annual product conference with an AI hackathon. The acquisition consists of two companies, as mentioned. Greenmetrica, which is a specialist consultancy firm, and Lumia AI Platform, which is the AI foundation and the platform used in product development. Their main offering has been to automate ESG workflows, leveraging agentic AI. And what is that, you may ask? There's a lot of buzzwords around AI currently. That is systems which autonomously can make decisions, pursue goals and take actions within complex tasks. That can, for example, mean to gather data, to question that data, make decisions, and complete a task or more tasks without constant user input. This is an enabler of delivering a customized and adaptive product user experience. So now we talked a little bit about the Q1 events, and we will go into a strategic update. The construction industry provides us all with places to live, places to work. And it's currently, actually one, approximately one New York being built every month. And as mentioned, the construction industry is facing challenges with only around 1% productivity growth, which is vastly lower than other industries. And it also contributes to around 39% of all energy related CO2 emissions. So we have a huge potential here. In essence, projects need product information and products need to be specified in projects. And our platform can act as the bridge between projects and products. So the stakeholders in the construction industry and the manufacturers. Let's take it from the beginning. A typical building project can consist of many stakeholders, and here we have mentioned an example. So we have a property developer, mainly active in the construction and commissioning phase, but of course also goes much wider than that usually. A general contractor. around five consultancy companies, so that can be architects, engineers, often heavily involved in the design and planning phase. We also have subcontractors, which all of these previously mentioned stakeholders can leverage. We then have around 500 manufacturers, 6,000 products coming from those manufacturers. And that in the end equals or results in about a million data points. And that is a lot. Today, product data is fragmented, it's siloed and inconsistent. I would say that it is extremely difficult to retrieve product information at scale. That is because it's often scattered across manufacturers' websites, product sheets, multiple databases, and it's also presented in various formats. That could be kilograms versus grams, different units of length, you name it. And it's also so that the collected data is unlikely to be reused across companies. due to each of them using their own software, private libraries and systems, since there is actually no solution of that as today, which is both providing product information and serving that in a user-friendly context. This also means that even though high quality data is found, it also often loses reliability and the necessary details for stakeholders as it is shared along the process. So how do we then want to solve that? We want to connect the products with the projects. At the heart of our strategy is our core. Our core is a centralized, structured, and trusted dynamic data model. And that data model stores, refines, and contextualizes product information, and as well as the interactions around it. This core ensures that product data is reliable, enriched and usable across the entire building lifecycle. Surrounding the core, we have three pillars, compile, consume and connect. We compile structured product data. This means that we are enabling manufacturers to create high quality, standardized and ready to use product data. structured to meet the needs of real projects. Consume on the upper hand of that cycle ensures that this data is not only accessible, but actionable. So we want to make sure that we can deliver the right data to the right stakeholder in the right format at the moment when it's needed. For example, to drive design decisions, compliance, sustainability reporting and procurement. Let's take a step back and look at a few easy examples. In the beginning of the building process in the design phase, you often you need an often generic but can also be specific object with geometrical data. So something to use in in your digital design. while at the end of the project, either during the building process or when the house or project is being built during the reporting phase, you instead need the circularity data and other type of lifecycle data. And then finally, the largest circle around, we connect data with stakeholders across the value chain. This is our platform as a service solution. So we believe that we cannot ourselves deliver all the compile and consume services needed, but we can also provide the platform for other companies to leverage and connect to. So our goal is to be an open source, reliable database, which is at the core of the ecosystem. where we integrate partners, systems, and tools to create this networked ecosystem where data flows freely and we can also actually scale the value. We know that there are several great local offerings and products in the market, and we want to collaborate with them. And this is to get for us a larger market share, higher customer loyalty, and also strengthen our long-term offering. And if you want to get deeper into these pillars of ours, you can also read more about them in the annual report. And we will also deep dive in this in the annual general meeting in a couple of weeks. So speaking of then the compile pillar, we will today get a demo of one product within that pillar. So within Compile, we enable manufacturers to get access to their product information and to provide it in iDynamic form. So we make sure that it can be used for different purposes based on the stakeholder. So today, we will hear from Daniel, our chief product officer, who will give us a fly-in of why the AndoX product is needed and also show us how it can look like. And we have decided to bring this up today also in the light of the recent press release about Greenmetrica and the MIA AI platform. So let's hear it from Daniel. Now we'll play a pre-recorded demo here for you.

Hello and welcome to this presentation. My name is Daniel Olausson and I'm the CBO at Gimobi Group. Manufacturing businesses today is up for a challenge. As the world is changing, the demand for data is also. The underwakes that we will speak about in this presentation is how we can help them regarding the carbon account. If we start with some numbers, we can see that we have more than 500,000 billion product manufacturers around the globe. In the next coming years, they will be affected by creating product-specific information like, for example, EPDs. A conservative approach will show that they will create at least four EPDs per company. We would end up then around two million EPDs created in the next coming years. Utilizing the way of working as for today, This would end up around roughly 160 million hours spent. Counting according to Swedish normal taxes or Swedish normal rates, we would end up roughly on 15.2 billion euros to do this. So what is the main challenge and why did I end up here? A lot of the manufacturers in the world today is facing quite strong legal demands coming in. We have in the US, we have the EPA, for example, directive for EPDs in governmental buildings. In the EU, we have ETS4D, we have the upcoming CPR, CPR regulation, and more to come. And due to that, the data complexity and track this carbon across your supply chain and actually make this data is quite hard to do. And there is no source for support to do so. So the result of this is what you saw in the previous screen. Actually, the cost will be quite tremendous if we still rely on consultants to do this and do this in a very low scalable way. The cost will be very high. We also see a clear trend from the BPMs. They want to achieve quite good data quality. Lately, there have been several cases where companies have been accused for greenwashing or you can't really follow up your green claims. And this can hurt the company substantially, especially now when we move into the reality when you almost connect your financial reporting together with the sustainability reporting. If we play with the thoughts that we will actually change, then we're moving into something we call software support for global accounting. And if we look at a little bit the market situation for these tools, we can see that in 2024, Global carbon accounting software was approximately 16.9 billion euros and forecasted to grow to around 70 billion euros in 2030. If we connect together to these LCA and EPD tools, we today see that approximately 2023, I didn't find any figures for 2024, was roughly 1.9 billions. And this is also forecasted to grow approximately around 6 to 7 billion. And I think this is a quite conservative approach, at least to me. So we see a movement in the industry when you're moving from using consultancy services to softwares. Looking back two to three years, the movement has been quite slow, but we really see an accelerating movement now. And we mainly think this is due to the scalability. I think a lot of companies out there right now is realizing that scaling in the way they're using data today is not feasible. We also see that we're moving into industry 4.0, where we can use AI and IoT to connect and gathering data in a much more efficient way. And this would also need to include in the way of thinking about carbon accounting. At least, but maybe most important is that today we have a very project-based approach, meaning that you're contacting a consultancy firm, you're asking for their support, they're starting a project, they meet your EPDs or NCA's or reporting, and then you see, then you're done. And for the next thing you're doing it, you do exactly the same thing again. What we need to adapt is more a way that you work with economics, that you have a data layer, And you're adding data to this. So moving from a project-based approach to a system-based approach. Therefore, B-Mobic today is very thrilled to announce the AndoX, the world's first EPP software. Environmental Product Performance Calculating Software. So what is the AndoX then? The AndoX is a software that can run one data layer, create information for several different reports. in an easy, fast, and scalable way. EandoX is built around four main principles. We collect data. It can be connected to ERP and BIM systems. It can also be used in other sources of import for data collection. We have an advanced calculation engine that is empowered with a lot of different AI methodologies to measure and calculate LCA by the book. So not any shortcuts. And we can then make a report of these measured calculations to, for example, EPDs, CSRD or CBA. What is very important for this is to keep the rigidity in the calculation. And this we have managed to do by combining over 100 years of LCA expertise within the company with the cutting edge AI technology. These make also the data set perfect to do the billion reduction journey for the future. So how do these connect into the BIM object then? The output from EanduX is always the product data. The same product data that goes into BIM objects or into product. But we also know that more than 90% of the carbon comes from the BPM supply chain. So what you can do in EanduX is that you actually can connect your supply chain to your account through digital contracts that make it very easy to keep track and scale your carbon accounting. But using this way of working, like for example with the AndoX, then we are quite committed that you can save up to 90% of your time spent. Now I want to show you a glimpse of the future. The main issue when you're dealing with LCAs or data in general is to get data in and keep it updated. We have for some time now worked on the AI flow with AI agents that will actually support the user within it. And this is the first demo available for this. So what's happening here is that we upload Excel file straight out from Microsoft Dynamics, that is an ERP system. This is a very unstructured file. The AI then asks for which product we want to create from this file. It also wants us to enter some specific instruction if we want. In this case, we tell the AI which column that includes weight for this Excel file. The AI starts analyzing the things. It starts to search through the files, and it has actually created the first product here with the first step of components that should be included in this product to be imported. We see now that it has done all the components that is used for this product and its subcomponents. every product component can then be looked at in the reasoning and see how that it can up with this data and where in this the documentation being uploaded can this information be found it creates packaging as well for this product and then it could be entered into android that we will look into more deeply now so when you have managed to get your data into android we for example use of ai that you have seen previously then this is what you will see this is one product in the data set of many products the product consists of components materials packaging and factories to make it easy to maintain you can look at the different materials impact we can select different impact categories and we can do an analyze to see okay what is the hot spots coming from we can navigate in to different components to see from their materials. You can also add packaging and packages in this level. We can work with transportation, we can work with different factories to be more granular. But the whole system is built up so it could be used by the non-expert to actually go in, analyze their data and make decisions. After you have worked with your product data, then you want to make an EPD. Here you can work fully dynamically with different program operators, different products, and create your EPDs within the tool. We are also gathering all the products that is publicly available and compare your results with the average products. As you can see, this share would have been a little bit worse than the other products on the market. This is also to help you to find errors, eliminate those. When we're satisfied with the information within DPD, we can, in the tool, go and edit the PDF. We can apply pictures. We can change everything. And we can, in the UI, make all the changes that's required into DPD. When we are satisfied, we can publish DPD. to generate LCA report and define the EPD version. So what you have seen now is the AndoX. It's time to start your sustainability journey. What you're offering is a scalable data layer that is ready to take your data into the next step. we can both create the data quality where it needs to be. Nevertheless, if you have very high ambitions, be it your sustainability work or just to be compliant. The way we're building data makes it not only compliant for today in the market and regulatory months, but also for the demands for tomorrow. So Underex is basically the easiest way how to make EPDs get compliant and get ready for the future. Thank you very much. Hello and welcome.

Thank you. So hopefully that was valuable to all of you.

So to summarize, we have started testing EandoX with select customers, and we have done this to validate the product market fit and also to make sure that we are meeting the customer needs. During the year, we will prepare the product for scale up and also set a blueprint for the go-to market. So with that said, now let's go into financials and hear from our CFO, Per Göransson.

Thank you, Sofia. And first, a few very brief comments to the quarter. We are recognizing steady growth in revenue, but within the quarter a bit of mixed development in our ARR portfolio. We see clearly increased investments in new products, but cost increase also includes a couple of items affecting comparability. That is currency revaluation, CEO transition and provision of social security contributions related to the incentive programs as the share price increased in Q1. If we go a little deeper into revenue development within our platform subscription business, we recognize revenue by day and hence there's always a little bit of a minor date effect in Q1. Year over year, recurring revenue grew 8%, and that is close to our ARR growth. Within the ARR portfolio during the quarter, we do see good growth in all our key platforms. BIMobject.com showed generally good inflow of new customers and also relatively high churn, but BIMobject is overall growing at a steady but low pace. Product.com had an improved and good quarter with accelerated growth and EM2X showed early growth from a small base. What is holding back growth in the period is related to larger downgrade in a contract linked to an early version of our distributor solution. A significant upgrade has been made to that product and we're confident about the solution going forward. Services revenue grew by 10% versus previous year. Cost development stands out a little bit more. It is first to 5.8 million related to cost items affecting comparability. Cleared from this, we see an underlying cost increase of 18% versus previous year. this is in line with our strategic plan primarily more external consultants and employees and we have been operating in full force during the quarter so in total higher costs leads to increased losses short term overall expected development cleared from the items affecting comparability EBITDA at minus 18.1 million and EBIT at minus 20.2 million.

Thank you so much, Per. So to summarize,

We have heard today about some business updates. We have seen the EandoX demo and then quarterly financials. And we will soon move into the Q&A section. So to wrap up before then, as an interim CEO here, I have two objectives. So one, and most importantly, is to making sure that this company perform at its best, keeping the engine going. And the second one is to prepare for the new CEO, making sure that they get the best possible start and momentum as possible. In BIMobject, we're building a scalable ecosystem where product information is compiled, consumed and connected. We believe in building something larger than ourselves and being the leading provider of reliable product information for the construction industry. And I believe firmly that BIMobject is uniquely positioned to take on this position. Thank you so much for listening and let's move into questions and answers.

Thank you, Sofia. And we have had a couple of questions come in to the email. And again, iterating here, you can email us at ir.bmobjekt.com if you have more questions. But let's start with the first one. So first question is related to the recent launch of the design app that we did this month. So the question is, will the design app include a subscription-based plan with paid features from the start? Or will the current version be free but function as a way to attract more project customers to use and pay for features inside the predict pattern?

Really good question. So the design app that we also had a demo of in the last quarterly report will be a free app to begin with. And that is because we have the aim to direct users into the product platform, just as the question states. So the purpose of it is to monetize within products.

Thank you. And another question related to features inside the BIMobject platform. So question is on the insight section on BIMobjects, BPMs or building product manufacturers can search for projects. How extensive is this list and do you charge credits for unlocking locked projects?

And there seem to be, from what I understand from the question, somewhat of a confusion here around what is available in the product right now. And I would gladly jump on a call to go a bit deeper in this. But BPMs today can get access to very detailed data around where and who or from whom the download is taking place for their digital objects on bmob.com. So this is a feature that is currently monetized via our plan structure. So based on the tier you have, so the higher tier, you get access to more data. And on project.com, in a similar fashion, manufacturers can get access to aggregated information on where their products are used in projects. So bridging this gap and allowing manufacturers to access to analytics around real project is something that we're working towards. And as we progress with our strategy around compiling, consuming and connecting the data, we will for sure come back to this.

Thank you, Sofia. The next questions that we got here center around the product roadmap and specifically around BIM.com and what our plans are for that platform. So there's a couple of different questions in this question. So I will read it out and then I will let you, Sofia, answer all at once here. So the question goes, under the umbrella brand BIM.com, do you have any plans on developing products for other areas of the building industry, such as design tools for non-professionals, project tools for craftsmen, etc.? ? And following up on that is there, how about having a project section on BIM.com open for craftsmen as well and let them bid on projects via BIM.com? And lastly, the question would be, is there a demand for a procurement solution with an integrated order and payment system so that BPMs can get deals done directly on BIM.com? So a lot of questions on what we are planning and what the future potential is around BIM.com.

And I mean, we indeed see a lot of interesting potential across the broad building life cycle. Our strategy right now is not to build a solution for every use case ourselves, but under the connect pillar of the strategy, as we mentioned, our plan is to open up the BIM.com platform so that third party developers and industry partners of ours can integrate their solutions into the ecosystem. So this way, we believe that we faster can enable a broader range of services on BIM.com without diluting our focus or duplicate efforts. So create something that already exists and works really well. So we see ourselves rather as a platform as a service provider, not a product company for every segment, even though we want to have our core products as well, of course. But thankful for all the suggestions and ideas.

Great. So another question here. We have in these calls in the past been talking a lot about user services. When are they expected to be launched?

So as outlined in the strategic framework we discussed, the consume pillar is focused on delivering value to users. So historically, that has mainly been architects, engineers and other professionals within that segment. But now, especially with the now a long time ago, acquisition of Carbon Zero, also other professionals and an increasingly broader group. So while many of these services may not carry a direct fee for the user, they play a critical role in driving platform adoption and engagement. And the more users rely on these features in their workflow, the more value we create across the ecosystem, which then in turn supports our revenue model through platform based monetization.

Another more general question, when do we expect the company to be profitable?

I mean, this is, of course, something that is included in our plan, but nothing that we currently provide guidance on. So as you have seen, in this quarter, we invest quite heavily in new products, as we believe that this is critical for both long-term growth and profitability. But nothing that we provide guidance on as of now.

Thank you for that, Sofia. And I'm trying to pick up the last questions here that's coming into the email. So bear with me while I translate to English here. So we have a question around the acquisition of these new companies that were announced yesterday. And the question here is, what is the rationality behind acquiring these companies when we already have a collaboration with them today?

That is a very good question. And there is, of course, always great with with cooperation. But having the right skills in house and the full control of the our own product development is better. So we believe that the possibility now to acquire and integrate both the team and the technology is better for us going forward. So both a risk minimizing effort, and also actually a value creation in the sense that we also get a broader knowledge sharing by having these resources internally.

Thank you for that. And I'm doing a little bit of final check, but I do believe those are the questions that we had coming into us. So with that, we are going to wrap up the call. I want to thank everyone for spending the time with us today. Like we said, we are open for questions as usual with the ir.bimobject.com email. And I believe the next time you will see or hear from us will be around... Oh, sorry, sorry. I have missed one of the final questions here. Okay, so sorry, there was a part two to that final question we had around the acquisitions that I slightly missed here. So the question goes, as we mentioned on the call, we have collaborated with these companies for a while, but the companies themselves are registered. From the 1st of January 2024. So how is this? Yes, how does this work?

And that is true. And we have collaborated with the team through different entities. So it has been same people, same platform, different entities.

Okay. Okay, thank you. And now I do hope I've covered all the questions. But again, please reach us via the email if you have any more questions. Okay, so we will wrap up the call for today. Thank you for joining us. And the next time you will hear from us will be on our annual meeting, I believe.

Yes, the 22nd of May. 22nd of May. In Malmö. In Malmö.

So thank you to our panelists and thank you for listening to us. Have a great rest of your day.