Carasent AB

customers within Adopus and the largest one, Fetix, is now really, really happy with the product and they're giving out testimonials saying how good the product is. You can see them on the LinkedIn and also other social media. And I think Adopus Web is a great product. We have to learn how to sell it, we have to learn how to increment in a good way to make it easy for customers. But once we do, we will be able to really sell. But what this organization do is set us in a cost structure that give us time to succeed with Adopus Web. And that's the main reason. And what that means is that the coming 12 months will not try to do any new sales of Adopus Web. We just try to move all customers from old Adopus to new Adopus Web. Then when we have happy customers in that solution, we can start selling to new customers. And then we have all these present customers talking about how they can make a difference. And we're working well about a new product. It's very difficult to do both at the same time. So we have to accept that back, lower the pace a bit in that organization, lower costs so we can take time to move customers over to the new product and then sell to new customers. And I think it would be a really beneficial structure to be in the same structure as Adurys. And that means then that the head of Adopus have had to leave the company and also another employee in that part of the organization. Looking at Metodica and that to the guys, what I see as our enterprise solution. So it's for really big caregivers that use the same system across multiple clinics and hospitals. And those type of caregivers, they usually want some adoption. So if you're looking at WebDoc, which is for single clinics or groups of clinics, we don't do any adoptions at all. But in Metodica, a large caregiver like Volvo, which is for all Swedish speakers, it's Tapio Norway. They're implementing in all of their units. We're replacing roughly five different digital systems. Then you want as a customer to be able to have some adoptions for your business. And that's what we're doing at the moment for Volvo. I think we had a bit of mission creeps, so they've been wanting a bit more function than we had planned for originally, such as patient portal, which we plan for stability in the future. But this increased the amount of work now. And it has taken more work than we planned to get everything ready for Volvo. It also has meant that we have not had time to work with present customers that we used to. So we have a big backlog on change requests from present customers. And that's what we usually get quite a lot of revenue from. So in total, we're forming them behind plan the first half of the year. But looking from another perspective, our consultancy revenue in the third case, four million behind what was two years ago, even though we have more employees. Yes, because everyone is putting all the time into into all of us. And on the other hand, most part of all that we go live by the end of this last quarter this year and the beginning of next year. And then we start getting our revenues from the customers and that from all that and that will be 79 million of new revenue. Yes, for the system and for different add ons, but it's no consultancy work in that numbers. And then we should also have the other four million that we're now not getting for consultancy work for other customers. So it's a quite big swing of somewhere around 11 to 13 million SEK that we should see do next year from that product alone. And this is a part of the cost when we move from selling licenses, do consultancy work to actually selling subscriptions instead. It turns us shorter, but we win long term on it. And as most of you know, the majority of our products have always been subscription based. But me, too, gas not define our major reasons, a investments. We have, so to speak, playing around with technology for points of time. We've been looking at what other players do. And we became very convinced of the potential for AI to lessen the administrative burden of our customers, which is the big burden, but they really don't like to spend the time on and they spend a lot of time on administration. A is really good at helping with that. We also really strongly to build it into the systems is is a great way of doing it because then you can access all the information around the patient. When you do it, not only listening to the conversations in the patient and the doctor, we can also use all the other information that are in the medical records and in the calendar and so on. So we can really do a lot to burden our customers. I also think it's a technology that we shouldn't say no to. We should should invest in us in that. I think that's where a lot potentially a lot of the future lies. So we decided in the beginning of the year to invest more into AI and to invest in partly new competence into the organization. I'm not very stressed about it. I think it's great potential going forward and we have no need to be first. We have the HR position. That's a difficult one. You don't leave that is less customer. You can stay there. So as long as we can, we can be competitive. It's easy for customers to move from another competing solution to our solution. That being said, I think that we also selling competitors solutions for this type of support and we continue to sell also our competitors or partners. Then to put it that way solutions and I think for some customers, one solution, right. And for other customers, another solution will be derived. But I think for very many of our customers, our solution will be the most appropriate. It will be completely built in. No need to do work in double systems and the AI will have access to much more information than in an external system. Today we have the ambient listening. So listening on the discussion between the patient and doctor. Next, we will start filling out different types of forms, referrals, signals and so on to really unburden our customers. But we still have quite a lot of work. Just for example, this week we're releasing new functionality, which will cut the time it takes to propose a record by roughly a third, I think. So quite a big improvement for customers that are already live coming this week. But these three, these three are the areas which are the main reasons for revised targets. I think that if you look at Volvo, it's really something positive for us going forward. It's of course negative that we're spending a bit more cost on it than we planned. And also that it stops us from generating other types of revenue this year, but it will pass. Adopus, a big part of it is the restructuring cost for moving into a more leading organization, which will help us come forward. And they, I think, will be really good going forward. And I think it was worth investing a bit more this year than we planned originally. So those are the main reasons for revised targets, which now look like this. So you see the revenue has been slightly lowered. And say, and the DA and the DA minus cutbacks is a bit higher lower by roughly 10 million kronor. Looking into our new medium term targets, we have great products. I'm really proud of the products we have. I think it's even stronger that we invest quite a lot in our products and invest in the products increase the distance between us and competitors. So we set it to invest more than most of our competitors. And that means that it would really help driving growth going forward. And it will really allow us to grow with an average of 15 percent the coming three years. And together with good cost discipline, and this will allow us to continue to rapidly improve profitability, reaching an average of 45 percent with the cutbacks of less than 10 percent. So these are our new medium targets, which we believe strongly in. And I think also it's wise to guide on this horizontal when we are in this type of rapid transition from where we used to be. With those words, I would hand over to Martin.

Thank you. And starting off by looking at the financial highlights as discussed, we are we are a bit behind the plan in Q2. But in general, I would say that the underlying financials continue to develop in in the right direction. Our ARR grew by 27 percent to three hundred and seventeen million, including the backlog of assigned not implemented contracts. The reported recurring revenues grew 13 percent organically in the quarter and a net retention of hundred and nine. And as we have talked a lot about during the last year, this the pace in going into Q2 was not that strong given this turn. We had we have seen in WebDoc for the customers going bankrupt. So most of that, as we spoke about last quarter, took took effect at the end of Q1. So this affected the pace going into Q2. The positive is that the pace going out of Q2 is stronger, which I will get get back to. On the profitability side, our EBITDA margin was 15 percent and EBITDA minus CapEx three percent. So improvements compared to last year, but but a bit behind our targets. This slide shows a key metric for us. That is how we are able to convert our revenues into profits. And here we exclude the acquisition we did last year. They tell and they say that the revenue growth was around eight million and then COGS naturally increased around a million. You see that the operating expense decreased by four million compared to last year. But part of this is that last year was high driven by one of costs of two point five. And then we see that the big increase here on the cost side is the personnel expense. It should be looked in connection with the CapEx decrease. So because that's like the total cash cost for our employee base, those two combined and that increased like around six million. The reason for this is mainly the biggest part of that increase is this restructuring cost that we had in Norway and also the option program that we executed in Q2. And in total these cost around close to four million. So adjusted for this, the increase is not that big on the personal expense side. But looking at like the total effects, we converted fifty six percent of the revenues into IBTAC. And if we had adjusted for like the one of last year and the special costs we had in the quarter, then we would have been close to our target, but still a bit behind. We are internal targets on this is converting around 80 percent. We have taken more steps on the cost side in this quarter, removed a few more roles in addition to the other PUS employees. That we didn't see the need for and this will help us in H2. And we need to be around our target there of 80 percent conversion to reach the 25 goals, the new goals. Looking at the ARR, we grew from 250 million to 317 million. On the organic side, we grew by 36 million in upsell or 16 percent. Churn was nine million and new customer growth was 12 million. The reason the two main factors driving the growth was that we onboarded several new large customers and clinics in Norway. For the other curious in addition to to a strong upsell for that product as well in the quarter. So we added around seven million in ARR in towards the end of this quarter for good is alone, which is really strong for that product. Partly this very some contract that we have talked about. The second effect is that we adjusted the prices for several smaller WebDoc customers that were paying enough compared to their production. So that added a couple of million in ARR as well. On the churn side, it's a bit higher than than normal. For reasons we have discussed with this churning WebDoc related to the bankruptcies and also a high churn in adopus as we have talked about before. But in total, the net effect is that we end the quarter at the near our growth organically at 17 percent, which is decent compared to what we report in the quarter. Looking at the PNL, I talked about most of this already, but we we landed at 83 million in revenues, ups 26 percent gross profit margin remains stable at 85 percent. Then the big increase on the cost side is the personnel expense. Despite that, the day increased from eight to twelve million within the quarter and even then, this capex from minus one to two on an adjusted basis. And so far this year, we have improved from minus six in a bit to plus seven. So a good improvement, but still a bit behind what we had expected on the cash flow side. We are, of course, helped by these improvements in profitability, lower capex as well. If you look at the cash flow in the quarter, it was in total positive by a couple of million. For the first half of the year, we have talked about this in the past few quarters, but we had this really sting expenses that were the costs were taken in Q4. But if the invoices were paid in Q1, so that affects like the working capital for this year. Also, we had a bit of currency effects when we exchanged the cash from Nuk to SEC in Q1. So normally our working capital helps us support the cash flow. But this year it will be a bit affected by these really sting expenses. So that was what we were going through and then we can open up for a Q&A.

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